NOTE 2 - ASSETS AND LIABILITIES HELD FOR SALE

9 Months Ended

Sep. 30, 2019

ASSETS AND LIABILITIES HELD FOR SALE

NOTE 2 – ASSETS AND LIABILITIES HELD FOR SALE

On August 13, 2019, the Company and RB&T entered into a Purchase and Assumption Agreement (the Agreement) to sell certain assets and liabilities of RB&T, a wholly-owned subsidiary headquartered in Rockford, Illinois, to IB&T, a wholly-owned subsidiary of Heartland Financial USA, Inc. Under the terms of the Agreement, IB&T will acquire certain assets and assume certain liabilities of RB&T for a cash payment. The actual cash payment amount will be determined substantially by the following formula: (i) the “Purchase Price Premium”, plus (ii) the aggregate net book value of the acquired assets, minus (iii) the aggregate book value of the assumed liabilities. The Purchase Price Premium is equal to: (a) 8% of RB&T’s tangible assets, multiplied by (b) 0.345. Based on RB&T’s balance sheet as of September 30, 2019, the Purchase Price Premium would be $14.2 million and the total payment by IB&T to the Company would be $59.7 million. The transaction is subject to approval by federal and state bank regulators and to customary closing conditions. The transaction is expected to close in the fourth quarter of 2019.

Assets and liabilities of RB&T classified as held for sale are summarized as follows as of September 30, 2019:


	As of
	September 30, 2019
	(dollars in thousands)

ASSETS
Cash and cash equivalents	$	13,446
Securities		66,009
Loans, net		362,011
Other assets		24,081
Assets held for sale	$	465,547

LIABILIITES
Deposits	$	451,546
Borrowings		16,157
Other liabilities		2,827
Liabilities held for sale	$	470,530