First Guaranty Bancshares Inc.
07/01/2024 | Press release | Distributed by Public on 07/01/2024 07:17
Material Agreement Form 8 K
Item 1.01 Entry into a Material Definitive Agreement.
On June 28, 2024 First Guaranty Bank (the "Bank"), a wholly-owned subsidiary of First Guaranty Bancshares, Inc. ("First Guaranty"), sold three properties previously owned by the Bank, two stand-alone branches and a portion of the headquarters building which also contains a branch (collectively, the "Properties"), to FGB Partners, L.L.C. (the "Purchaser"), for an aggregate cash purchase price of approximately $15.0 million. All of the Properties are located in Louisiana.
Purchaser is wholly owned by three of our directors and significant shareholders: our Chairman Marshall T. Reynolds, Edgar Ray Smith III and William K. Hood.
The Bank concurrently entered into absolute net lease agreements (the "Lease Agreements") with Purchaser under which the Bank will lease each of the Properties. Each of the Lease Agreements will have an initial term of 15 years with specified renewal options. We will not close any branches or exit any markets as part of the sale-leaseback transaction.
The sale-leaseback transaction resulted in a pre-tax gain of approximately $13.2 million, or $10.4 million after tax. Aggregate first full year of rent expense under the Lease Agreements will be approximately $1.3 million pre-tax, or $1.0 million after tax.