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Shareholders OK Heritage reorganization

ALBANY, Ga. -- Shareholders of Heritage Financial Group and members of Heritage MHC have approved the conversion of the Albany-based financial institution to a full publicly-owned company.

At the same time, officers with the new Heritage Financial Group have sold 6.59 million shares of common stock to raise about $65.9 million, some of which will finance future growth of the banking company.

Of that stock, 1,113,699 shares of stock have been accepted in the community stock offering in the markets served by Heritage.

Orders for 5,458,057 shares have been accepted from institutional money managers.

Bank executives O. Leonard Dorminey, Heath Fountain and Mitchell Smith visited New York City, Boston and Chicago in recent days pitching the stock to institutional money managers. This came after the stock sale was offered and sold in the local market areas.

Heritage Financial Group will become the parent holding company of HeritageBank of the South and will be wholly owned by stockholders.

As part of the conversion, each current outstanding share of company common stock, other than shares held by Heritage MHC, will be converted to 0.8377 shares of New Heritage Financial Group common stock.

Dorminey, company CEO, said the exchange ratio allows existing shareholders to maintain about the same ownership interest in New Heritage Financial Group as they did before the reorganization.

Total shares outstanding after the stock offering and the exchange will be about 8,780,640 shares.

The company's common stock will continue to trade on the Nasdaq global market as HBOS through Nov. 29. On Nov. 30, the shares of a new Heritage Financial Group common stock will trade on Nasdaq under the trading symbol HBOSD for 20 days.

Then, the trading symbol will revert to HBOS.

Stock certificates for shares purchased in the subscription offering and community offering are expected to be mailed to subscribers around Dec. 1. Current shareholders of the company holding shares in street name or in book-entry form will receive shares of Heritage Financial Group within their accounts.

Current shareholders holding shares in certificated form will be mailed a letter of transmittal on or about Dec. 3 and will receive their shares of the new company and cash in lieu of fractional shares after returning their stock certificates and a letter of transmittal of the company's transfer agent.

In addition to approving the reorganization, a majority of shareholders also approved provisions which make it difficult for a shareholder group to complete a hostile takeover of the company. Several provisions call for a supermajority vote of 80 percent rather than a simple majority.

HeritageBank of the South serves primarily south Georgia and North Central Florida through 16 offices.