Attached files
| file | filename |
|---|---|
| EX-99.1 - EXHIBIT 99.1 - PARK NATIONAL CORP /OH/ | prkndbanncjointnewsrelease.htm |
| 8-K - 8-K - PARK NATIONAL CORP /OH/ | a1-23x188xk.htm |
January 23, 2018 NYSE AMERICAN: PRK | OTC PINK: NDMN
and
Strategic Partnership and Expansion into North Carolina
Forward-looking Statement Disclosure
Certain statements contained in this communication which are not statements of historical fact constitute forward-looking statements
within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements can often, but not always, be
identified by the use of words like “believe”, “continue”, “pattern”, “estimate”, “project”, “intend”, “anticipate”, “expect” and similar
expressions or future or conditional verbs such as “will”, “would”, “should”, “could”, “might”, “can”, “may”, or similar expressions.
These forward-looking statements include, but are not limited to, statements relating to the expected timing and benefits of the proposed
merger (the “Merger”) between Park National Corporation (“Park”), The Park National Bank and NewDominion Bank (“NewDominion”),
including future financial and operating results, cost savings, enhanced revenues, and accretion/dilution to reported earnings that may be
realized from the Merger, as well as other statements of expectations regarding the Merger, and other statements of Park’s goals,
intentions and expectations; statements regarding the Park’s business plan and growth strategies; statements regarding the asset quality
of Park’s loan and investment portfolios; and estimates of Park’s risks and future costs and benefits, whether with respect to the Merger or
otherwise. These forward-looking statements are subject to significant risks, assumptions and uncertainties that may cause results to
differ materially from those set forth in forward-looking statements, including, among other things: the risk that the businesses of Park and
NewDominion will not be integrated successfully or such integration may be more difficult, time-consuming or costly than expected;
expected revenue synergies and cost savings from the Merger may not be fully realized or realized within the expected time frame;
revenues following the Merger may be lower than expected; customer and employee relationships and business operations may be
disrupted by the Merger; the ability to obtain required governmental and shareholder approvals, and the ability to complete the Merger on
the expected timeframe; possible changes in economic and business conditions; the existence or exacerbation of general geopolitical
instability and uncertainty; the ability of Park to integrate recent acquisitions and attract new customers; possible changes in monetary
and fiscal policies, and laws and regulations; the effects of easing restrictions on participants in the financial services industry; the cost
and other effects of legal and administrative cases; possible changes in the credit worthiness of customers and the possible impairment of
collectability of loans; fluctuations in market rates of interest; competitive factors in the banking industry; changes in the banking
legislation or regulatory requirements of federal and state agencies applicable to bank holding companies and banks like Park’s affiliate
bank; continued availability of earnings and excess capital sufficient for the lawful and prudent declaration of dividends; and changes in
market, economic, operational, liquidity, credit and interest rate risks associated with the Park’s business. Please refer to Park’s Annual
Report on Form 10-K for the year ended December 31, 2016, as well as its other filings with the Securities and Exchange Commission
(the "SEC"), for a more detailed discussion of risks, uncertainties and factors that could cause actual results to differ from those discussed
in the forward-looking statements.
All forward-looking statements included in this communication are made as of the date hereof and are based on information available as
of the date hereof. Except as required by law, none of Park, Park National Bank or NewDominion assumes any obligation to update any
forward-looking statement.
1
Important Information about the Merger
In connection with the proposed merger, Park will file with the SEC a Registration Statement on Form S-4 that will include a Proxy
Statement of NewDominion and a Prospectus of Park, as well as other relevant documents concerning the proposed transaction.
SHAREHOLDERS OF NEWDOMINION ARE URGED TO READ THE REGISTRATION STATEMENT AND THE PROXY
STATEMENT/PROSPECTUS REGARDING THE MERGER WHEN IT BECOMES AVAILABLE AND ANY OTHER RELEVANT
DOCUMENTS FILED WITH THE SEC, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THOSE DOCUMENTS, BECAUSE
THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT PARK, PARK NATIONAL BANK, NEWDOMINION AND THE PROPOSED
TRANSACTION.
A free copy of the Proxy Statement/Prospectus, as well as other filings containing information about Park and NewDominion, may be
obtained at the SEC’s website (http://www.sec.gov). You will also be able to obtain these documents, free of charge, from Park at the
“Investor Information” section of Park's website at www.parknationalcorp.com or from NewDominion at the “Investor Relations” section of
NewDominion’s website at www.newdominionbank.com. Copies of the Proxy Statement/Prospectus can also be obtained, free of charge,
by directing a request to Park National Corporation, 50 North Third Street, P.O. Box 3500, Newark, OH 43058-3500, Attention: Investor
Relations, Telephone: (740) 322-6844 or to NewDominion Bank, PO Box 37389, Charlotte, NC 28237, Attention: Investor Relations,
Telephone: (704) 943-5725.
This communication shall not constitute an offer to sell or the solicitation of an offer to buy securities nor shall there be any sale of
securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the
securities laws of such jurisdiction. This communication is also not a solicitation of any vote in any jurisdiction pursuant to the proposed
transactions or otherwise. No offer of securities or solicitation will be made except by means of a prospectus meeting the requirements of
Section 10 of the Securities Act of 1933, as amended. The communication is not a substitute for the Registration Statement that will be
filed with the SEC or the Proxy Statement/Prospectus that will be sent to NewDominion shareholders.
2
Park National / NewDominion – Transaction Overview
3
1. Based on the 20-day average PRK closing price as of January 19, 2018
2. Takes into account Park’s 8.55% existing ownership at a cost of $3.5 million or $0.54 per NewDominion share, initially made in November
2016
Deal value:
Blended deal value:
$76.4 million1
$79.9 million1,2
Consideration: Option to elect $1.08 in cash or 0.01023 shares of Park common stock for each share of NewDominion common stock, subject to a 60% stock / 40% cash structure
Per share price:
Blended per share price:
$1.081
$1.031,2
Required approvals: • Regulatory• NewDominion shareholder
Key assumptions:
• Cost savings estimated to be 35%
• Estimated one-time charges of $6.5 million
• Gross credit mark of approximately 2.5% (including unfunded commitments)
Earnings and capital
impact2:
• Accretive to EPS by 1.6% in 2019 and 3.7% in 2020
• Tangible book value earn-back of approximately 4.2 years
• Capital position will remain strong, creating potential for additional acquisitions, stock
buybacks, strong dividend payout
Anticipated closing: Mid-2018
Strategic opportunity: Similar market in some respects to Park’s home market of Greater Columbus, but with even better growth prospects
Park National / NewDominion – Selected Highlights
Pro Forma Branch Map
Transaction Metrics1
Blended price per share / TBVPS: 200.9%
Blended price per share / adj. TBVPS2: 188.1%
Blended price per share / 2019 EPS w/ synergies: 13.4x
NewDominion pro forma ownership: 2.8%
4
Park Branches (108)
NewDominion Branches (2)
NewDominion Financials
(as of and for the year ended 12/31/17)
Total assets: $338.3 million
Total gross loans: $284.4 million
Total deposits: $282.3 million
Total equity (all tangible): $39.0 million
2017 efficiency ratio: 86.5%
NPAs / assets: 1.02%
2017 NCOs (recoveries) / average loans: (0.08)%
1. Based on the 20-day average PRK closing price as of January 19, 2018 and takes into account Park’s 8.55% existing ownership
2. Reflects adjusted tangible book value per share assuming the inclusion of NewDominion’s $2.7 million off balance sheet deferred
tax asset
Park National / NewDominion – Strategic Rationale
5
Demographically accretive, given attractive Charlotte market demographics
− Charlotte’s five-year population growth rate projected to be 11x Ohio average and 2x national average (Nielsen)
− Charlotte is the largest metropolitan area in the Carolinas with over 2.5 million residents (Nielsen)
− Charlotte was rated among top 20 places to live in the U.S. (U.S. News & World Report)
− Charlotte’s tech talent pool grew faster than any other top 50 U.S. tech market (CBRE)
− Charlotte is home to six Fortune 500 companies (Fortune)
Culturally similar; Park has become very familiar with NewDominion since initially investing $3.5 million in
NewDominion in a friendly transaction in November 2016
Terrific NewDominion management team that has completed a turnaround effort and is eager to grow its
franchise as part of the Park team
Strategically important but a small and lower-risk acquisition for Park