Carolina Financial Corporation (NasdaqCM:CARO) signed a definitive agreement to acquire Congaree Bancshares Inc. (OTCPK:CNRB) for approximately $15 million in cash and stock on January 5, 2016. Under the terms of the acquisition agreement, Congaree Bancshares, Inc. shareholders will have the right to receive $8.10 for each share of Congaree Bancshares, Inc. common stock, payable, at their election and subject to certain limitations, in cash or in shares of Carolina Financial Corporation common stock based upon a fixed exchange ratio of 0.4806. Carolina Financial will also issue preferred stock for each preferred stock of the Congaree. Carolina will also acquire options of Congaree. As per the agreement, 40% of the consideration will be paid in cash and the balance 60% will be in newly issued shares of Carolina Financial Corporation common stock. In case of termination of the agreement, Congaree Bancshares shall pay $7.5 million as termination fee of Carolina Financial.

The transaction is subject to customary closing conditions, including regulatory approvals and Congaree Bancshares, Inc. shareholder approval, registration statement effectiveness and approval of listing of issued shares on the exchange. The agreement has been unanimously approved by the Boards of Directors of both companies and is anticipated to close in the second quarter of 2016. As announced on April 22, 2016, the transaction has received regulatory approval and is expected to close in early June, 2016. On June 8, 2016, the transaction was approved by shareholders of Congaree Bancshares. Carolina Financial Corporation anticipates this transaction will be immediately accretive to earnings per share (before acquisition costs) with tangible book value per share recovered in less than three years.

B.T. Atkinson of Nelson Mullins Riley & Scarborough LLP acted as the legal advisor for Carolina Financial Corporation. BSP Securities, LLC acted as fairness opinion provider and received $0.02 million and William L. Pitman of Smith Moore Leatherwood, LLP acted as the legal advisor for Congaree Bancshares, Inc. Computershare Limited acted as transfer agent and registrar for Carolina Financial. Regan & Associates, Inc. acted as proxy solicitor for Congaree Bancshares and received a fee of $0.01 million.