Mechanics Bank (OTCBB: MCHB) (“Mechanics”) today announced that Mechanics and Rabobank International Holding B.V. (“Rabo Parent”) have received regulatory approval from the Board of Governors of the Federal Reserve, The Office of the Comptroller of Currency, The Federal Deposit Insurance Corporation and the California Department of Business Oversight for the pending acquisition of Rabobank, N.A. (“RNA”), Rabobank’s California-based and primarily retail bank, by Mechanics. No further regulatory approvals are required for Mechanics and Rabo Parent to consummate the acquisition and the other transactions contemplated by the March 15, 2019 stock purchase agreement by and between Mechanics and Rabo Parent (the “stock purchase agreement”). The acquisition is expected to close on or about September 1, 2019, subject to the satisfaction of the remaining conditions set forth in the stock purchase agreement.
Mechanics also announced today that it commenced a rights offering to its current shareholders. Pursuant to the rights offering, current shareholders will receive 1.10 subscription rights for each share of common stock owned as of 5:00 p.m., Pacific Time, on July 26, 2019, the record date of the rights offering. Each subscription right will entitle current shareholders to purchase one share of Mechanics common stock at the subscription price of $38,000 per share. Shareholders are not entitled to any over-subscription privilege. Funds received from subscribers in the rights offering will be held by the subscription agent until the rights offering is completed or canceled. The subscription rights will expire if they are not exercised by 5:00 p.m., Pacific Time, on August 23, 2019. Mechanics reserves the right to extend the expiration date of the rights offering one or more times. The closing of any purchase of common stock pursuant to the subscription rights will occur on August 26, 2019 unless the expiration date is extended, in which case the closing date will be the first business day after the expiration date. All subscriptions received by Mechanics in the rights offering are irrevocable.
In connection with the rights offering and the stock purchase agreement, affiliates of Ford Financial Fund II and Ford Financial Fund III (the “Ford shareholders”) have entered into commitments to acquire approximately 29,395 shares of Mechanics common stock (subject to adjustment for any reduction in the aggregate gross proceeds required to be received by Mechanics from the Ford shareholders for Mechanics to satisfy its obligation to pay the cash consideration in the acquisition of RNA pursuant to the stock purchase agreement, including to the extent shareholders other than an affiliate of Ford Financial Fund II exercise subscription rights in the rights offering).
Mechanics may cancel the rights offering at any time, and the rights offering is conditioned on the continued satisfaction or waiver of the closing conditions set forth in the stock purchase agreement (other than the condition related to the completion of the rights offering).
Source: Company Press Release
