Item 1.01. Entry into a Material Definitive Agreement
On November 6, 2025, First Financial Corporation, an Indiana corporation ("First Financial"), and CedarStone Financial, Inc., a Tennessee corporation (“CedarStone”), entered into an Agreement and Plan of Reorganization (the "Merger Agreement") pursuant to which CedarStone will be merged with and into First Financial (the “Merger”). Immediately following completion of the Merger, CedarStone Bank, a wholly owned subsidiary of CedarStone (“CedarStone Bank”), will merge into First Financial Bank, N.A. (“First Financial Bank”), a wholly owned subsidiary of First Financial.
Merger Consideration
Upon the terms and subject to the conditions set forth in the Merger Agreement, at the effective time of the Merger, First Financial will pay $19.12 per share in cash for each share of CedarStone’s common stock outstanding. The aggregate value of the transaction is approximately $25.0 million.
Other Terms and Conditions
The Merger Agreement contains customary representations, warranties and covenants of CedarStone and First Financial, including, among others, covenants relating to the conduct of CedarStone’s business during the period between the execution of the Merger Agreement and the consummation of the Merger. The Merger Agreement provides each of CedarStone and First Financial with certain termination rights. If the Merger is not consummated under specified circumstances, including if CedarStone or First Financial terminates the Merger Agreement under certain circumstances and CedarStone enters into an alternative transaction within 12 months of the termination, CedarStone has agreed to pay First Financial a termination fee in the amount of $1.0 million.
The Merger Agreement was unanimously approved by the Boards of Directors of First Financial and CedarStone. The parties anticipate that the transaction will close in the first quarter of 2026, subject to approval of CedarStone's shareholders, regulatory approvals, and other customary closing conditions.
The foregoing summary of the Merger Agreement is not complete and is qualified in its entirety by reference to the complete text of the Merger Agreement, which is filed as Exhibit 2.1 to this Current Report on Form 8-K and which is incorporated by reference in its entirety.
The Merger Agreement has been filed herewith to provide investors and security holders with information regarding its terms. It is not intended to provide any other factual information about First Financial, First Financial Bank, CedarStone, or CedarStone Bank. The Merger Agreement contains representations, warranties and covenants that First Financial and CedarStone made to each other as of specific dates. The assertions embodied in those representations, warranties and covenants were made solely for purposes of the Merger Agreement and may be subject to important qualifications and limitations agreed to by First Financial and CedarStone in connection with negotiating its terms, including being qualified by confidential disclosures exchanged among the parties in connection with the execution of the Merger Agreement. Moreover, the representations and warranties may be subject to a contractual standard of materiality that may be different from what may be viewed as material to investors or securityholders, or may have been used for the purpose of allocating risk among First Financial and CedarStone rather than establishing matters as facts. Moreover, information concerning the subject matter of the representations and warranties may change after the date of the Merger Agreement, which subsequent information may or may not be fully reflected in First Financial’s public disclosures. For the foregoing reasons, no person should rely on the representations and warranties as statements of factual information at the time they were made or otherwise.
Cautionary Statements Regarding Forward-Looking Information
Certain statements contained in this report that are not statements of historical fact constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, certain plans, expectations, goals, projections and benefits relating to the Merger, which are subject to numerous assumptions, risks and uncertainties. Words such as “believes,” “anticipates,” “likely,” “may,” “will,” “should,” “future,” “plan,” “goal,” “seek,” “projects,” “expected,” “estimated,” “intends,” and other similar expressions or the negative of these terms are intended to identify forward-looking statements but are not the exclusive means of identifying such statements. Please refer to the First Financial’s Report on Form 10-K for the year ended December 31, 2024, as well as its other filings with the SEC, for a more detailed discussion of risks, uncertainties and factors that could cause actual
