Hawthorn Bancshares (NASDAQ: HWBK) buying FSC in $28.3M Missouri bank deal
Filing Impact
Filing Sentiment
Form Type
8-K
Rhea-AI Filing Summary
Hawthorn Bancshares, Inc. is acquiring FSC Bancshares, Inc., parent of Farmers State Bank, in a cash and stock transaction valued at approximately $28.3 million based on Hawthorn’s share price of $34.57 on April 28, 2026.
FSC shareholders will receive 413,101 shares of Hawthorn common stock and $14.0 million in cash, plus cash in lieu of fractional shares. Based on March 31, 2026 data, the combined company is expected to have about $2.2 billion in assets, $1.7 billion in loans and $1.9 billion in deposits, adding roughly $384 million of assets and nine branches in northern Missouri.
Hawthorn expects the deal to increase earnings per share by about 20% on a fully phased-in basis, with tangible book value dilution of roughly 9.8% and an earnback period of about three years. The merger, unanimously approved by both boards, is expected to close in the third quarter of 2026, subject to shareholder and regulatory approvals and other customary conditions.
Positive
- None.
Negative
- None.
Insights
Hawthorn pursues EPS-accretive Missouri bank acquisition with moderate tangible book dilution.
The transaction values FSC Bancshares at about $28.3 million, paid via 413,101 Hawthorn shares and $14.0 million in cash. It adds roughly $384 million in assets and nine branches, taking the combined balance sheet to about $2.2 billion in assets.
Hawthorn projects around 20% earnings-per-share accretion on a fully phased-in basis, a meaningful uplift if achieved. This comes with estimated tangible book value dilution of about 9.8%, with earnback in roughly three years using the crossover method, a trade-off common in community bank M&A.
Deal closure depends on regulatory approvals, SEC effectiveness of the Form S-4, Nasdaq listing of new shares and FSC shareholder approval. There is also a $1,120,000 termination fee payable by FSC in certain scenarios, plus voting and director support agreements that help align key stakeholders with consummation of the merger.
8-K Event Classification
3 items: 1.01, 7.01, 9.01
3 items
Item 1.01
Entry into a Material Definitive Agreement
Business
The company signed a significant contract such as a merger agreement, credit facility, or major partnership.
Item 7.01
Regulation FD Disclosure
Disclosure
Material non-public information disclosed under Regulation Fair Disclosure, often investor presentations or guidance.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
Key Figures
Deal value: $28.3 million
Stock consideration: 413,101 shares
Cash consideration: $14.0 million
+5 more
8 metrics
Deal value
$28.3 million
Aggregate merger consideration based on $34.57 HBI share price on April 28, 2026
Stock consideration
413,101 shares
Total Hawthorn common shares to be issued to FSC shareholders
Cash consideration
$14.0 million
Cash portion payable to FSC shareholders under merger terms
Combined assets
$2.2 billion
Expected total assets of combined company as of March 31, 2026
Farmers State Bank assets added
$384 million
Approximate assets contributed by Farmers State Bank and nine branches
Expected EPS accretion
20%
Projected earnings-per-share accretion on fully phased-in basis
Tangible book value dilution
9.8%
Estimated TBV per share dilution at closing with ~3-year earnback
Termination fee
$1,120,000
Fee payable by FSC upon specified terminations of the merger agreement
Key Terms
Agreement and Plan of Reorganization, tax-free reorganization, Registration Statement on Form S-4, tangible book value dilution, +2 more
6 terms
Agreement and Plan of Reorganization regulatory
"entered into an Agreement and Plan of Reorganization (the “Reorganization Agreement”)"
An agreement and plan of reorganization is a formal roadmap negotiated between a financially distressed company and its creditors that explains how debts, assets and ownership will be restructured so the business can continue operating. For investors it’s the document that determines who gets paid, what claims are reduced or converted into new shares, and how much existing equity may be wiped out or diluted — like a household rearranging bills and mortgages to stay solvent while deciding who gets repaid and how.
tax-free reorganization financial
"the Merger will qualify as a reorganization within the meaning of Section 368(a)"
A tax-free reorganization is a corporate restructuring—such as a merger, acquisition, or stock-for-stock exchange—structured so that shareholders do not have to pay immediate income tax on gains from the transaction. Think of it like swapping houses under a rule that lets you avoid a tax bill until you later sell; it matters to investors because it affects the timing of taxes, the adjusted cost basis of their holdings, and the net economic benefit they actually receive from the deal.
Registration Statement on Form S-4 regulatory
"HBI will file with the SEC a Registration Statement on Form S-4"
A registration statement on Form S-4 is a formal filing with the U.S. Securities and Exchange Commission used when a company issues shares or other securities as part of a merger, acquisition, exchange offer or similar corporate deal. It bundles the transaction terms, financial statements, risk factors and shareholder vote materials so investors can assess the deal; think of it as a detailed prospectus or buyer’s packet that explains what you would own and how the deal could change your stake.
tangible book value dilution financial
"Tangible book value dilution at closing is expected to be approximately 9.8%"
termination fee financial
"a termination fee of $1,120,000 will be payable by FBI in connection with the termination"
A termination fee is a payment required if one party ends a contract before its agreed-upon end date. It acts like a penalty or compensation to the other party for canceling early, similar to a fee you might pay for breaking a lease or canceling a service contract. For investors, it matters because it can influence a company's decisions and financial obligations related to ending agreements prematurely.
fairness opinion financial
"Olsen Palmer LLC rendered a fairness opinion to FSC."
A fairness opinion is a professional assessment that evaluates whether the terms of a financial deal, such as a merger or acquisition, are fair from a financial point of view. It helps investors and stakeholders understand if the deal is reasonable and balanced, much like an independent expert giving an unbiased judgment on whether a price or agreement is fair. This assurance can increase confidence that the transaction is fair for all parties involved.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): April 29, 2026
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Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
Securities registered pursuant to Section 12(b) of the Act:
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
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
Item 1.01 Entry into a Material Definitive Agreement.
On April 29, 2026, Hawthorn Bancshares, Inc., a Missouri corporation (“HBI”), entered into an Agreement and Plan of Reorganization (the “Reorganization Agreement”), by and among HBI, Hawthorn Holdco, Inc., a Missouri corporation and wholly-owned subsidiary of HBI (“Merger Sub”), and FSC Bancshares, Inc., a Missouri corporation (“FBI”), pursuant to which HBI will acquire FBI.
Subject to the terms and conditions set forth in the Reorganization Agreement, Merger Sub will merge with and into FBI, with FBI surviving as a wholly owned subsidiary of HBI (the “First Step Merger”). Immediately following the First Step Merger and as part of the same overall transaction, FBI will merge with and into HBI, with HBI surviving the merger (the “Second Step Merger,” and together with the First Step Merger, the “Merger”). Immediately following the Merger and as part of the same overall transaction, Farmers State Bank, a Missouri state bank and wholly owned subsidiary of FBI (“Farmers State Bank”), will merge with and into Hawthorn Bank, a Missouri state bank and wholly owned subsidiary of HBI (“Hawthorn Bank”), with Hawthorn Bank surviving the merger.
Pursuant to the terms and subject to the conditions of the Reorganization Agreement, which has been unanimously approved by the boards of directors of each of HBI and FBI, each share of FBI common stock issued and outstanding immediately prior to the effective time of the Merger (the “Effective Time”) will be converted into the right to receive (i) the amount of cash equal to the quotient of $14,000,000, subject to adjustment in accordance with the Reorganization Agreement, divided by the aggregate number of shares of FBI common stock issued and outstanding as of the Effective Time, rounded to the nearest cent; (ii) a number (such number, the “Exchange Ratio”), subject to adjustment in accordance with the Reorganization Agreement, of shares of HBI common stock equal to the quotient of (A) 413,101 shares of HBI common stock divided by (B) the aggregate number of shares of FBI common stock issued and outstanding immediately prior to the Effective Time, rounded to the nearest ten thousandth (the “Per Share Stock Consideration”); and (iii) cash in lieu of any fractional shares.
The cash consideration is subject to reduction in the event that FBI does not deliver at least $19,000,000 of total shareholders’ common equity as determined in accordance with GAAP, less any intangible assets and certain merger costs, and reflecting other specified items described in the Reorganization Agreement.
Based on the closing price of $34.57 per share for HBI common stock on April 28, 2026, the aggregate value of the merger consideration to be paid is approximately $28.3 million.
The Reorganization Agreement contains customary representations, warranties and covenants made by each of HBI and FBI. Completion of the Merger is subject to certain conditions, including, among others, the (i) approval by FBI’s shareholders of the Reorganization Agreement, (ii) listing on Nasdaq of the shares of HBI common stock to be issued in the Merger, (iii) receipt of all governmental and regulatory consents and approvals required to consummate the Merger, (iv) U.S. Securities and Exchange Commission (the “SEC”) having declared effective under the Securities Act of 1933, as amended (the “Securities Act”), HBI’s registration statement covering the issuance of shares of HBI common stock in the Merger, and (v) absence of any injunction, order or legal restraint prohibiting the consummation of the Merger. Each party’s obligation to complete the Merger is also subject to additional customary conditions, including, among others, (a) the accuracy of the representations and warranties of the other party, subject to certain exceptions, (b) the performance in all material respects by each party of its obligations under the Reorganization Agreement, and (c) receipt by such party of an opinion from its counsel to the effect that the Merger will qualify as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended.
The Reorganization Agreement contains certain termination rights for both HBI and FBI, including, among others, if the Merger is not consummated on or before January 31, 2027 (subject to
extension as described in the Reorganization Agreement) or if the requisite approval of FBI’s shareholders is not obtained. The Reorganization Agreement further provides that a termination fee of $1,120,000 will be payable by FBI in connection with the termination of the Reorganization Agreement under certain circumstances.
The Merger is expected to close in the third quarter of 2026, subject to the satisfaction of customary closing conditions, certain of which are listed above.
Aside from the transactions contemplated by the Reorganization Agreement, there is no material relationship between HBI and FBI.
The foregoing summary of the Reorganization Agreement and the transactions contemplated thereby does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the Reorganization Agreement, which is filed as Exhibit 2.1 to this Current Report on Form 8-K (this “Form 8-K”) and is incorporated herein by reference.
In connection with entering into the Reorganization Agreement, HBI entered into a voting agreement (the “Voting Agreement”) with the directors and executive officers of FBI, pursuant to which such persons have agreed, subject to the terms set forth therein, to vote their shares of FBI common stock in favor of the Reorganization Agreement and the transactions contemplated thereby, including the Merger, and to not sell or otherwise dispose of any of their shares of FBI common stock until after the meeting of FBI’s shareholders to vote on the Reorganization Agreement. The parties to the Voting Agreement beneficially own in the aggregate approximately 37.9% of the outstanding shares of FBI common stock.
The foregoing description of the Voting Agreement does not purport to be complete and is subject to, and qualified in its entirety by, the form of Voting Agreement, which is filed as Exhibit 10.1 to this Form 8-K and is incorporated herein by reference.
In addition, in connection with entering into the Reorganization Agreement, each non-employee director of FBI or Farmers State Bank entered into a director support agreement (the “Director Support Agreements”), pursuant to which each director agrees to refrain from harming the goodwill of HBI, FBI or any of their respective subsidiaries and their respective customer, client and vendor relationships for a period of two (2) years following the completion of the Merger, as well as certain additional restrictive covenants.
The foregoing description of the Director Support Agreements does not purport to be complete and is subject to, and qualified in its entirety by, the form of Director Support Agreement, which is filed as Exhibit 10.2 to this Form 8-K and is incorporated herein by reference.
The Reorganization Agreement and the above description of the Reorganization Agreement and related transactions have been included to provide investors and security holders with information regarding the terms of the Reorganization Agreement. They are not intended to provide any other factual information about HBI, FBI or their respective subsidiaries, affiliates or businesses. The representations, warranties and covenants contained in the Reorganization Agreement were made only for purposes of that agreement and as of specific dates, were solely for the benefit of the parties to the Reorganization Agreement and may be subject to limitations agreed upon by the parties, including being qualified by confidential disclosures made by each party to the other for the purposes of allocating contractual risk between them that differs from those applicable to investors. Investors should not rely on the representations, warranties or covenants or any description thereof as characterizations of the actual state of facts or condition of HBI, FBI or any of their respective subsidiaries, affiliates or businesses. Moreover, information concerning the subject matter of the representations, warranties and covenants may change after the date of the Reorganization Agreement, which subsequent information may or may not be fully reflected in public disclosures by HBI or FBI. Accordingly, investors should read the representations and warranties in the Reorganization Agreement not in isolation but only in conjunction
with the other information about HBI or FBI and their respective subsidiaries and affiliates that the respective companies include in reports, statements and other filings they make with the SEC.
Item 7.01 Regulation FD Disclosure.
On April 29, 2026, HBI issued a press release announcing the execution of the Reorganization Agreement. A copy of the press release is attached to this Form 8-K as Exhibit 99.1.
In accordance with General Instruction B.2 of Form 8-K, the information in this Item 7.01, including Exhibit 99.1, is being furnished pursuant to Item 7.01 of Form 8-K and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to liabilities of that section, nor shall it be deemed incorporated by reference into any filing under the Securities Act or the Exchange Act, unless specifically identified therein as being incorporated therein by reference.
Item 9.01 Financial Statements and Exhibits.
Exhibit No | Description | ||||
(d) | Exhibits. | ||||
2.1 | Agreement and Plan of Reorganization, by and among Hawthorn Bancshares, Inc., Hawthorn HoldCo, Inc. and FSC Bancshares, Inc., dated as of April 29, 2026 (Schedules and exhibits have been omitted pursuant to Item 601(b)(2) of Regulation S-K. A copy of any omitted schedule will be furnished supplementally to the SEC upon request; provided, however, that the parties may request confidential treatment pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended, for any document so furnished.). | ||||
10.1 | Form of Voting Agreement. | ||||
10.2 | Form of Director Support Agreement. | ||||
99.1* | Press release, dated April 29, 2026, issued by Hawthorn Bancshares, Inc. | ||||
104 | Cover Page Interactive Data File (formatted as Inline XBRL). | ||||
* Furnished, not filed.
Cautionary Statement Regarding Forward-Looking Statements
This communication contains, and future oral and written statements of Hawthorn Bancshares, Inc. (“HBI,” or the “Company”) and Hawthorn Bank (“Hawthorn Bank” or the “Bank”) may contain, forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are subject to risks and uncertainties and are made pursuant to the safe harbor provisions of Section 27A of the Securities Act. These forward-looking statements reflect HBI’s current views with respect to future events and HBI’s financial performance. Any statements about HBI’s expectations, beliefs, plans, predictions, forecasts, objectives, assumptions or future events or performance are not historical facts and may be forward-looking. These statements are often, but not always, made through the use of words or phrases such as “anticipate,” “believes,” “can,” “could,” “may,” “predicts,” “potential,” “should,” “will,” “estimate,” “plans,” “projects,” “continuing,” “ongoing,” “expects,” “intends” and similar words or phrases. HBI cautions that the forward-looking statements in this presentation are based largely on HBI’s current expectations, estimates, forecasts and projections and management assumptions about the future performance of each of HBI, FSC Bancshares, Inc. (“FBI”) and the combined company, as well as the businesses and markets in which they do and are expected to operate. Forward-looking statements include, but are not limited to: (i) projections and estimates of revenues, expenses, income or loss, earnings or loss per share, and other financial items, (ii) statements of plans, objectives and expectations of HBI or its management, (iii) statements of future economic performance, and (iv) statements of assumptions underlying such statements. Forward-looking statements should not be relied on because they involve known and unknown risks, uncertainties, assumptions and other factors, that are difficult to assess and are subject to change based on factors which are, in many instances, beyond the control of HBI and Hawthorn Bank. These risks, uncertainties and other factors may cause the actual results, performance, and achievements of HBI and Hawthorn Bank to be materially different from the anticipated future results, performance or achievements expressed in, or implied by, the forward-looking statements. Factors that could cause such differences include, but are not limited to, the expected impact of the proposed transaction between HBI and FBI and on the combined entities’ operations, financial condition, and financial results; the businesses of
HBI and FBI may not be combined successfully, or such combination may take longer to accomplish than expected; the cost savings from the proposed transaction may not be fully realized or may take longer to realize than expected; operating costs, customer loss and business disruption following the proposed transaction, including adverse effects on relationships with employees, may be greater than expected; regulatory approvals of the proposed transaction may not be obtained, or adverse conditions may be imposed in connection with regulatory approvals of the proposed transaction; the FBI shareholders may not approve the proposed transaction; the impact on HBI and FBI, and their respective customers, of a decline in general economic conditions that would adversely affect credit quality and loan originations, and any regulatory responses thereto; slower economic growth rates or potential recession in the United States and HBI’s and FBI’s market areas; the impacts related to or resulting from uncertainty in the banking industry as a whole; increased competition for deposits in our market areas among traditional and nontraditional financial services companies, and related changes in deposit customer behavior; the impact of changes in market interest rates, whether due to a continuation of the elevated interest rate environment or further reductions in interest rates and a resulting decline in net interest income; the lingering inflationary pressures, and the risk of the resurgence of elevated levels of inflation, in the United States and HBI’s and FBI’s market areas; the uncertain impacts of current and future monetary policies of the Board of Governors of the Federal Reserve System; changes in unemployment rates in the United States and HBI’s and FBI’s market areas; adverse changes in customer spending, borrowing and savings habits; declines in commercial real estate values and prices; a deterioration of the credit rating for U.S. long-term sovereign debt or the impact of uncertain or changing political conditions, including federal government shutdowns and uncertainty regarding United States fiscal debt, deficit and budget matters; cyber incidents or other failures, disruptions or breaches of our operational or security systems or infrastructure, or those of our third-party vendors or other service providers, including as a result of cyber-attacks; severe weather, natural disasters, military conflicts (including the conflicts in the Middle East, the possible expansion of such conflicts and potential geopolitical and economic consequences), acts of terrorism, geopolitical instability or other external events, including as a result of the policies of the current U.S. presidential administration or Congress; the impacts of tariffs, sanctions, and other trade policies of the United States and its global trading counterparts and the resulting impact on HBI and its customers; competition and market expansion opportunities; changes in non-interest expenditures or in the anticipated benefits of such expenditures; the risks related to the development, implementation, use and management of emerging technologies, including artificial intelligence and machine learning; potential costs related to the impacts of climate change; current or future litigation, regulatory examinations or other legal and/or regulatory actions; changes in accounting principles and standards, including those related to loan loss recognition under the current expected credit loss, or CECL, methodology; and changes in applicable laws, regulations or policies in the United States, including those affecting our business, operations, pricing, products or services. Actual results, performance or achievements could differ materially from those contemplated, expressed, or implied by the forward-looking statements due to additional risks and uncertainties of which HBI is not currently aware or which it does not currently view as, but in the future may become, material to its business or operating results. Due to these and other possible uncertainties and risks, HBI can give no assurance that the results contemplated in the forward-looking statements will be realized and readers are cautioned not to place undue reliance on the forward- looking statements contained in this presentation. Additional information regarding these factors and uncertainties to which HBI’s business and future financial performance are subject is contained in HBI’s most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q on file with the U.S. Securities and Exchange Commission (the “SEC”), including the sections entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of such documents, and other documents HBI files or furnishes with the SEC from time to time. Further, any forward-looking statement speaks only as of the date on which it is made and HBI undertakes no obligation to update or revise any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events, except as required by applicable law. All forward-looking statements, express or implied, herein are qualified in their entirety by this cautionary statement.
Additional Information and Where to Find It
This communication is being made with respect to the proposed transaction involving HBI and FBI. This material is not a solicitation of any vote or approval of the FBI shareholders and is not a substitute for the proxy statement/prospectus or any other documents that HBI and FBI may send to their respective shareholders in connection with the proposed transaction. This communication does not constitute an offer to sell or the solicitation of an offer to buy any 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 any such jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act.
In connection with the proposed transaction involving HBI and FBI, HBI will file with the SEC a Registration Statement on Form S-4 (the “Registration Statement”) that will include a proxy statement for a special meeting of FBI’s shareholders to approve the proposed transaction and that will also constitute a prospectus for the shares of HBI common stock that will be issued in the proposed transaction, as well as other relevant documents concerning the proposed transaction. BEFORE MAKING ANY VOTING OR INVESTMENT DECISIONS, INVESTORS AND SHAREHOLDERS ARE URGED TO READ CAREFULLY THE REGISTRATION STATEMENT AND THE PROXY STATEMENT/PROSPECTUS REGARDING THE PROPOSED TRANSACTION, AS WELL AS ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC AND ANY AMENDMENTS OR SUPPLEMENTS TO THOSE DOCUMENTS, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. When final, FBI will mail the proxy statement/prospectus to its shareholders. Shareholders are also urged to carefully review and consider HBI’s public filings with the SEC, including, but not limited to, its proxy statements, its Annual Reports on Form 10-K, its Quarterly Reports on Form 10-Q, and its Current Reports on Form 8-K. Copies of the Registration Statement and proxy statement/prospectus and other filings incorporated by reference therein, as well as other filings containing information about HBI, may be obtained, free of charge, as they become available at the SEC’s website at www.sec.gov. You will also be able to obtain these documents, when they are filed, free of charge, from HBI at www.hawthornbancshares.com. Copies of the proxy statement/prospectus can also be obtained, when it becomes available, free of charge, by directing a request to Hawthorn Bancshares, Inc., 132 East High Street, Jefferson City, Missouri 65101: Corporate Secretary, Telephone: (573) 761-6100.
Participants in the Solicitation
HBI, FBI and certain of their respective directors, executive officers and employees may, under the SEC’s rules, be deemed to be participants in the solicitation of proxies of FBI’s shareholders in connection with the proposed transaction. Information about HBI’s directors and executive officers is available in its definitive proxy statement relating to its 2026 annual meeting of shareholders, which was filed with the SEC on April 17, 2026, and its Annual Report on Form 10-K for the year ended December 31, 2025, which was filed with the SEC on March 5, 2026, and other documents filed by HBI with the SEC. Other information regarding the persons who may, under the SEC’s rules, be deemed to be participants in the solicitation of proxies of FBI’s shareholders in connection with the proposed transaction, and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the proxy statement/prospectus regarding the proposed transaction and other relevant materials to be filed with the SEC when they become available. Free copies of these documents may be obtained as described in the preceding paragraph. Investors should read the proxy statement/prospectus carefully when it becomes available before making any voting or investment decisions.
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.
HAWTHORN BANCSHARES, INC.
Dated: April 29, 2026 By: /s/ Brent M. Giles
Brent M. Giles
Chief Executive Officer
Exhibit 99.1
PRESS RELEASE – FOR IMMEDIATE RELEASE
Hawthorn Bancshares, Inc. Expands Missouri Presence with Acquisition of FSC Bancshares, Inc.
Hawthorn Bancshares, Inc. Expands Missouri Presence with Acquisition of FSC Bancshares, Inc.
JEFFERSON CITY, Mo. – April 29, 2026 — Hawthorn Bancshares, Inc. (“Hawthorn”) (NASDAQ: HWBK), the holding company for Hawthorn Bank, and FSC Bancshares, Inc. (“FSC”), the holding company for Farmers State Bank, today jointly announced the signing of an Agreement and Plan of Reorganization (the “Agreement”) pursuant to which Hawthorn will acquire FSC in a cash and stock transaction valued at approximately $28.3 million in the aggregate, based on Hawthorn’s closing stock price of $34.57 as of April 28, 2026.
Based on financial data as of March 31, 2026, the combined company is expected to have total assets of approximately $2.2 billion, total loans of approximately $1.7 billion, and total deposits of approximately $1.9 billion. The proposed transaction will further strengthen Hawthorn’s community banking franchise and meaningfully expand its presence in northern Missouri, adding approximately $384 million in total assets and nine branch locations across the Farmers State Bank footprint. Hawthorn expects the proposed transaction to be accretive to earnings per share by approximately 20% on fully phased in basis. Tangible book value dilution at closing is expected to be approximately 9.8% and earned back in approximately 3.0 years using the crossover method.
“We are pleased to partner with Farmers State Bank as we continue to execute on our strategy of disciplined growth,” said Brent Giles, Chief Executive Officer of Hawthorn. “Farmers has developed strong customer relationships and a respected community presence that align closely with Hawthorn’s values. This proposed transaction expands our footprint in Northwest Missouri and positions us to deliver an expanded range of products and services while maintaining the personalized service that customers expect from a community bank.”
Michael Poland, President of FSC, added, “We are excited to join Hawthorn and believe this partnership represents a compelling opportunity for our customers, employees, and communities. Hawthorn shares our commitment to community banking and relationship-driven service, and this combination will allow us to offer broader capabilities, enhanced technology, and additional financial solutions while preserving the local decision-making and service culture our customers value.”
Under the terms of the proposed transaction, which has been unanimously approved by the boards of directors of both companies, FSC shareholders will receive 413,101 shares of Hawthorn common stock and $14.0 million of cash. The proposed transaction is expected to be completed in the third quarter of 2026, subject to the satisfaction of customary closing conditions, including approval by FSC shareholders and the receipt of all required regulatory approvals. The proposed transaction is expected to qualify as a tax-free reorganization for federal income tax purposes.
Exhibit 99.1
Raymond James & Associates, Inc. served as financial advisor to Hawthorn Bancshares, Inc., and Hunton Andrews Kurth LLP served as its legal counsel. Northland Capital Markets served as financial advisor to FSC Bancshares, Inc., and Stinson LLP served as its legal counsel. Olsen Palmer LLC rendered a fairness opinion to FSC.
About Hawthorn Bancshares, Inc.
Hawthorn Bancshares, Inc. (NASDAQ: HWBK) is a financial holding company headquartered in Jefferson City, Missouri, and the parent company of Hawthorn Bank. Hawthorn Bank provides a broad range of commercial and consumer banking services, including deposit accounts, loans, and treasury management services, to individuals and businesses across Missouri through its network of banking locations. Hawthorn is focused on delivering relationship-based community banking and supporting the financial needs of the communities it serves.
Hawthorn Bancshares, Inc. (NASDAQ: HWBK) is a financial holding company headquartered in Jefferson City, Missouri, and the parent company of Hawthorn Bank. Hawthorn Bank provides a broad range of commercial and consumer banking services, including deposit accounts, loans, and treasury management services, to individuals and businesses across Missouri through its network of banking locations. Hawthorn is focused on delivering relationship-based community banking and supporting the financial needs of the communities it serves.
About FSC Bancshares, Inc.
FSC Bancshares, Inc. is the bank holding company for Farmers State Bank, a community bank headquartered in Cameron, Missouri. Farmers State Bank provides a full range of banking services to individuals, families, and businesses, with a focus on personalized service, local decision-making, and long-standing community relationships across the markets it serves.
FSC Bancshares, Inc. is the bank holding company for Farmers State Bank, a community bank headquartered in Cameron, Missouri. Farmers State Bank provides a full range of banking services to individuals, families, and businesses, with a focus on personalized service, local decision-making, and long-standing community relationships across the markets it serves.
Cautionary Statement Regarding Forward-Looking Statements
This communication contains, and future oral and written statements of Hawthorn Bancshares, Inc. (“HBI”) and Hawthorn Bank (“Hawthorn Bank” or the “Bank”) may contain, forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are subject to risks and uncertainties and are made pursuant to the safe harbor provisions of Section 27A of the Securities Act. These forward-looking statements reflect HBI’s current views with respect to future events and HBI’s financial performance. Any statements about HBI’s expectations, beliefs, plans, predictions, forecasts, objectives, assumptions or future events or performance are not historical facts and may be forward-looking. These statements are often, but not always, made through the use of words or phrases such as “anticipate,” “believes,” “can,” “could,” “may,” “predicts,” “potential,” “should,” “will,” “estimate,” “plans,” “projects,” “continuing,” “ongoing,” “expects,” “intends” and similar words or phrases. HBI cautions that the forward-looking statements in this presentation are based largely on HBI’s current expectations, estimates, forecasts and projections and management assumptions about the future performance of each of HBI, FSC Bancshares, Inc. (“FBI”) and the combined company, as well as the businesses and markets in which they do and are expected to operate. Forward-looking statements include, but are not limited to: (i) projections and estimates of revenues, expenses, income or loss, earnings or loss per share, and other financial items, (ii) statements of plans, objectives and expectations of HBI or its management, (iii) statements of future economic performance, and (iv) statements of assumptions underlying such statements. Forward-looking statements should not be relied on because they involve known and unknown risks, uncertainties, assumptions and other factors, that are difficult to assess and are subject to change based on factors which are, in many instances, beyond the control of HBI and Hawthorn Bank. These risks, uncertainties and other factors may cause the actual results, performance, and achievements of HBI and Hawthorn Bank to be materially different from the anticipated future results, performance or achievements expressed in, or implied by, the forward-looking statements. Factors that could cause such differences include, but are not limited to, the expected impact of the proposed transaction between HBI and FBI and on the combined entities’ operations, financial condition, and financial results; the businesses of HBI and FBI may not be combined successfully, or such combination may take longer to accomplish than expected; the cost savings from the proposed transaction may not be fully realized or may take longer to realize than expected; operating costs, customer loss and business disruption following the proposed transaction, including adverse effects on relationships with employees, may be greater than expected; regulatory approvals of the proposed transaction may not be obtained, or adverse conditions may be imposed in connection with regulatory approvals of the proposed
Exhibit 99.1
transaction; the FBI shareholders may not approve the proposed transaction; the impact on HBI and FBI, and their respective customers, of a decline in general economic conditions that would adversely affect credit quality and loan originations, and any regulatory responses thereto; slower economic growth rates or potential recession in the United States and HBI’s and FBI’s market areas; the impacts related to or resulting from uncertainty in the banking industry as a whole; increased competition for deposits in our market areas among traditional and nontraditional financial services companies, and related changes in deposit customer behavior; the impact of changes in market interest rates, whether due to a continuation of the elevated interest rate environment or further reductions in interest rates and a resulting decline in net interest income; the lingering inflationary pressures, and the risk of the resurgence of elevated levels of inflation, in the United States and HBI’s and FBI’s market areas; the uncertain impacts of current and future monetary policies of the Board of Governors of the Federal Reserve System; changes in unemployment rates in the United States and HBI’s and FBI’s market areas; adverse changes in customer spending, borrowing and savings habits; declines in commercial real estate values and prices; a deterioration of the credit rating for U.S. long-term sovereign debt or the impact of uncertain or changing political conditions, including federal government shutdowns and uncertainty regarding United States fiscal debt, deficit and budget matters; cyber incidents or other failures, disruptions or breaches of our operational or security systems or infrastructure, or those of our third-party vendors or other service providers, including as a result of cyber-attacks; severe weather, natural disasters, military conflicts (including the conflicts in the Middle East, the possible expansion of such conflicts and potential geopolitical and economic consequences), acts of terrorism, geopolitical instability or other external events, including as a result of the policies of the current U.S. presidential administration or Congress; the impacts of tariffs, sanctions, and other trade policies of the United States and its global trading counterparts and the resulting impact on HBI and its customers; competition and market expansion opportunities; changes in non-interest expenditures or in the anticipated benefits of such expenditures; the risks related to the development, implementation, use and management of emerging technologies, including artificial intelligence and machine learning; potential costs related to the impacts of climate change; current or future litigation, regulatory examinations or other legal and/or regulatory actions; changes in accounting principles and standards, including those related to loan loss recognition under the current expected credit loss, or CECL, methodology; and changes in applicable laws, regulations or policies in the United States, including those affecting our business, operations, pricing, products or services. Actual results, performance or achievements could differ materially from those contemplated, expressed, or implied by the forward-looking statements due to additional risks and uncertainties of which HBI is not currently aware or which it does not currently view as, but in the future may become, material to its business or operating results. Due to these and other possible uncertainties and risks, HBI can give no assurance that the results contemplated in the forward-looking statements will be realized and readers are cautioned not to place undue reliance on the forward- looking statements contained in this presentation. Additional information regarding these factors and uncertainties to which HBI’s business and future financial performance are subject is contained in HBI’s most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q on file with the U.S. Securities and Exchange Commission (the “SEC”), including the sections entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of such documents, and other documents HBI files or furnishes with the SEC from time to time. Further, any forward-looking statement speaks only as of the date on which it is made and HBI undertakes no obligation to update or revise any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events, except as required by applicable law. All forward-looking statements, express or implied, herein are qualified in their entirety by this cautionary statement.
Additional Information and Where to Find It
This communication is being made with respect to the proposed transaction involving HBI and FBI. This material is not a solicitation of any vote or approval of the FBI shareholders and is not a substitute for the proxy statement/prospectus or any other documents that HBI and FBI may send to their respective shareholders in connection with the proposed transaction. This communication does not constitute an offer to sell or the solicitation of an offer to buy any 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 any such jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act.
Exhibit 99.1
In connection with the proposed transaction involving HBI and FBI, HBI will file with the SEC a Registration Statement on Form S-4 (the “Registration Statement”) that will include a proxy statement for a special meeting of FBI’s shareholders to approve the proposed transaction and that will also constitute a prospectus for the shares of HBI common stock that will be issued in the proposed transaction, as well as other relevant documents concerning the proposed transaction. BEFORE MAKING ANY VOTING OR INVESTMENT DECISIONS, INVESTORS AND SHAREHOLDERS ARE URGED TO READ CAREFULLY THE REGISTRATION STATEMENT AND THE PROXY STATEMENT/PROSPECTUS REGARDING THE PROPOSED TRANSACTION, AS WELL AS ANY OTHER RELEVANT DOCUMENTS FILED WITH THE SEC AND ANY AMENDMENTS OR SUPPLEMENTS TO THOSE DOCUMENTS, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. When final, FBI will mail the proxy statement/prospectus to its shareholders. Shareholders are also urged to carefully review and consider HBI’s public filings with the SEC, including, but not limited to, its proxy statements, its Annual Reports on Form 10-K, its Quarterly Reports on Form 10-Q, and its Current Reports on Form 8-K. Copies of the Registration Statement and proxy statement/prospectus and other filings incorporated by reference therein, as well as other filings containing information about HBI, may be obtained, free of charge, as they become available at the SEC’s website at www.sec.gov. You will also be able to obtain these documents, when they are filed, free of charge, from HBI at www.hawthornbancshares.com. Copies of the proxy statement/prospectus can also be obtained, when it becomes available, free of charge, by directing a request to Hawthorn Bancshares, Inc., 132 East High Street, Jefferson City, Missouri 65101: Corporate Secretary, Telephone: (573) 761-6100.
Participants in the Solicitation
HBI, FBI and certain of their respective directors, executive officers and employees may, under the SEC’s rules, be deemed to be participants in the solicitation of proxies of FBI’s shareholders in connection with the proposed transaction. Information about HBI’s directors and executive officers is available in its definitive proxy statement relating to its 2026 annual meeting of shareholders, which was filed with the SEC on April 17, 2026, and its Annual Report on Form 10-K for the year ended December 31, 2025, which was filed with the SEC on March 5, 2026, and other documents filed by HBI with the SEC. Other information regarding the persons who may, under the SEC’s rules, be deemed to be participants in the solicitation of proxies of FBI’s shareholders in connection with the proposed transaction, and a description of their direct and indirect interests, by security holdings or otherwise, will be contained in the proxy statement/prospectus regarding the proposed transaction and other relevant materials to be filed with the SEC when they become available. Free copies of these documents may be obtained as described in the preceding paragraph. Investors should read the proxy statement/prospectus carefully when it becomes available before making any voting or investment decisions.