8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): December 17, 2018

SHORE BANCSHARES, INC.

(Exact name of registrant as specified in its charter)

Maryland	0-22345	52-1974638
(State or other jurisdiction of	(Commission file number)	(IRS Employer
incorporation or organization)		Identification No.)

28969 Information Lane, Easton, Maryland 21601

(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code: (410) 763-7800

N/A

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligations of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company       ¨

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

¨

Item 8.01. Other Events.

On December 17, 2018, Shore Bancshares, Inc. (the “Company”) and The Avon-Dixon Agency, LLC, the Company’s wholly-owned insurance producer firm (“Avon”), entered into an Asset Purchase Agreement (the “Purchase Agreement”) with Avon-Dixon, an Alera Group Agency, LLC (“Alera”), a Delaware limited liability company and subsidiary of Alera Group, Inc, a Delaware corporation, pursuant to which Alera will purchase substantially all of the assets used in the operation of Avon’s insurance business (the “Acquisition”). Subject to certain adjustments set forth in the Purchase Agreement, the Company will receive net proceeds of approximately $26.9 million on the closing date of the Acquisition. Subject to customary closing conditions, the Acquisition is expected to be completed before the end of fiscal 2018.

On December 17, 2018, the Company issued a press release announcing the execution of the Purchase Agreement. A copy of the press release is attached as Exhibit 99.1 to this Current Report on Form 8-K.

On December 17, 2018, Shore United Bank, the Company’s wholly-owned bank subsidiary (the “Bank”), appointed Lloyd L. Beatty, Jr., President and Chief Executive Officer of the Company, to be the Bank’s Chief Executive Officer, with such appointment effective as of December 17, 2018.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits

The exhibits that are filed or furnished with this report are listed in the Exhibit Index that immediately follows the signatures hereto, which list is incorporated herein by reference.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	SHORE BANCSHARES, INC.
Dated: December 17, 2018	By:	/s/ Lloyd L. Beatty, Jr.
		Lloyd L. Beatty, Jr. President and Chief Executive Officer

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EXHIBIT INDEX

Exhibit No.	Description
99.1	Press Release, dated December 17, 2018.

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EX-99.1

Sale of Insurance Subsidiary (The Avon-Dixon Agency, LLC)

EASTON, Md., Dec. 17, 2018 /PRNewswire/ -- On December 17, 2018, Shore Bancshares, Inc. (the "Company" or "Shore Bancshares") and The Avon-Dixon Agency, LLC, the Company's wholly-owned insurance producer firm ("Avon-Dixon"), entered into an Asset Purchase Agreement (the "Purchase Agreement") with Avon-Dixon, an Alera Group Agency, LLC ("Alera"), a Delaware limited liability company and subsidiary of Alera Group, Inc. ("Alera Group"), pursuant to which Alera will purchase substantially all of the assets used in the operation of Avon-Dixon's insurance business (the "Acquisition"). Subject to certain adjustments set forth in the Purchase Agreement, the Company will receive net proceeds of approximately $26.9 million on the closing date of the Acquisition. Subject to customary closing conditions, the Acquisition is expected to be completed before the end of fiscal 2018.

"We feel strongly that this is a great result for both Shore Bancshares and Avon-Dixon," said Lloyd L. (Scott) Beatty, President and CEO of Shore Bancshares. "The transaction will substantially increase the Company's regulatory capital which will enable us to expand our banking activities. The association with the Alera Group will afford the agency many new opportunities for growth. The entire team will remain in place and Rich Trippe will remain as the managing partner of the agency."

Mr. Trippe added, "Avon-Dixon has enjoyed a long and beneficial relationship with Shore Bancshares, during which the agency increased local presence while growing significantly. Now, we are tremendously excited about our future as a partner in Alera Group's nationwide network of insurance agencies. Joining Alera Group gives us the resources, technical expertise and best practices of a larger national firm, while maintaining the personal local service our clients have come to expect. We will remain Avon-Dixon, a local insurance presence since 1850."

Separately, Shore United Bank, the Company's wholly-owned bank subsidiary (the "Bank") appointed Mr. Beatty to be the Bank's Chief Executive Officer, with such appointment effective as of December 17, 2018.

About Shore Bancshares, Inc.

Shore Bancshares is a financial holding company headquartered in Easton, Maryland and is the largest independent bank holding company located on Maryland's Eastern Shore. It is the parent company of Shore United Bank; one retail insurance producer firm, Avon-Dixon, with two specialty lines, Elliott Wilson Insurance (Trucking) and Jack Martin Associates (Marine); and an insurance premium finance company, Mubell Finance, LLC. Shore Bancshares engages in trust and wealth management services through Wye Financial & Trust, a division of Shore United Bank.

Additional information is available at www.shorebancshares.com.

Forward-Looking Statements

The statements contained herein that are not historical facts are forward-looking statements (as defined by the Private Securities Litigation Reform Act of 1995) based on management's current expectations and beliefs concerning future developments and their potential effects on the Company. Such statements involve inherent risks and uncertainties, many of which are difficult to predict and are generally beyond the control of the Company. There can be no assurance that future developments affecting the Company will be the same as those anticipated by management. These statements are evidenced by terms such as "anticipate," "estimate," "should," "expect," "believe," "intend," and similar expressions. Although these statements reflect management's good faith beliefs and projections, they are not guarantees of future performance and they may not prove true. These projections involve risk and uncertainties that could cause actual results to differ materially from those addressed in the forward-looking statements. For a discussion of these risks and uncertainties, see the section of the periodic reports filed by Shore Bancshares, Inc. with the Securities and Exchange Commission entitled "Risk Factors".

The Company specifically disclaims any obligation to update any factors or to publicly announce the result of revisions to any of the forward-looking statements included herein to reflect future events or developments.

CONTACT: Lloyd ("Scott") Beatty, 410-763-7800.