Table of Contents

Filed Pursuant to 424(b)(3)
Registration No. 333-258967

 

 

LOGO LOGO

MERGER PROPOSED—YOUR VOTE IS VERY IMPORTANT

Dear Shareholder:

On June 2, 2021, United Bankshares, Inc. and Community Bankers Trust Corporation announced a strategic business combination in which Community Bankers Trust will merge with and into United Bankshares. The combined company, which will retain the United Bankshares name, will have approximately $29 billion in assets and operate over 225 branches across North Carolina, South Carolina, the District of Columbia, Virginia, Maryland, Pennsylvania, Ohio and West Virginia. Community Bankers Trust is sending you this prospectus and proxy statement to invite you to attend a special meeting of shareholders being held by Community Bankers Trust to allow you to vote on the merger.

If the merger is completed, holders of Community Bankers Trust common stock will receive 0.3173 shares of United Bankshares common stock in exchange for each share of Community Bankers Trust common stock held immediately prior to the merger, subject to the payment of cash in lieu of fractional shares. Upon completion of the merger, United Bankshares shareholders are expected to own approximately 94% of the combined company and former Community Bankers Trust shareholders are expected to own approximately 6% of the combined company. The number of shares of United Bankshares common stock that Community Bankers Trust shareholders will receive in the merger for each share of Community Bankers Trust common stock is fixed. The implied value of the consideration Community Bankers Trust shareholders will receive in the merger will change depending on changes in the market price of United Bankshares common stock and will not be known at the time you vote on the merger.

Based on the closing price of United Bankshares common stock on the NASDAQ Global Select Market, or Nasdaq (trading symbol “UBSI”), on June 2, 2021, the last trading day before public announcement of the merger, the 0.3173 exchange ratio represented approximately $13.06 in value for each share of Community Bankers Trust common stock. Based on United Bankshares’ closing price on October 4, 2021 of $36.89, the 0.3173 exchange ratio represented approximately $11.71 in value for each share of Community Bankers Trust common stock. Based on the 0.3173 exchange ratio and the number of shares of Community Bankers Trust common stock outstanding and reserved for issuance under various plans and agreements and in connection with various convertible securities as of October 4, 2021, the maximum number of shares of United Bankshares common stock issuable in the merger is expected to be 7,696,236.

If the average closing price of United Bankshares common stock declines by more than 20% from $41.71 and underperforms an index of banking companies by more than 20% over a designated measurement period, then Community Bankers Trust may terminate the merger agreement unless United Bankshares agrees to increase the number of shares to be issued or pay additional cash consideration to the holders of Community Bankers Trust common stock as part of the merger consideration.

The common stock of United Bankshares and Community Bankers Trust are listed on Nasdaq. United Bankshares and Community Bankers Trust urge you to obtain current market quotations for United Bankshares (trading symbol “UBSI”) and Community Bankers Trust (trading symbol “ESXB”).

The merger is structured to qualify as a reorganization within the meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended, which we refer to as the Code, and holders of Community Bankers Trust common stock will not recognize any gain or loss for United States federal income tax purposes on the exchange of shares of Community Bankers Trust common stock for shares of United Bankshares common stock in the merger, except with respect to any cash received in lieu of fractional shares of United Bankshares common stock.

At the special meeting of Community Bankers Trust shareholders to be held on November 16, 2021, holders of Community Bankers Trust common stock will be asked to vote to (1) approve the merger agreement, (2) approve, in a non-binding advisory vote, certain compensation that may become payable to Community Bankers Trust’s named executive officers in connection with the merger, and (3) approve the adjournment, postponement or continuance of the special meeting, if necessary, in order to further solicit additional proxies if there are not sufficient votes at the time of the special meeting to approve the merger agreement. Approval of the merger agreement requires the affirmative vote of a majority of the shares represented in person or by proxy at the special meeting if a quorum is established. The presence, in person or by proxy, of the holders of a majority of the outstanding shares of Community Bankers Trust common stock entitled to vote is necessary to constitute a quorum at the special meeting.

The Community Bankers Trust board of directors unanimously recommends that Community Bankers Trust shareholders vote “FOR” the approval of the merger agreement, “FOR” the approval, in a non-binding advisory vote, of certain compensation that may become payable to Community Bankers Trust’s named executive officers in connection with the merger, and “FOR” the approval of the adjournment, postponement or continuance of the special meeting, if necessary, in order to further solicit additional proxies if there are not sufficient votes to approve the merger agreement.

This document describes the special meeting, the merger, the documents related to the merger and other related matters. Please carefully read this entire document, including “Risk Factors” beginning on page 16 for a discussion of the risks relating to the proposed merger and owning United Bankshares common stock after the merger. You also can obtain information about United Bankshares and Community Bankers Trust from documents that each has filed with the Securities and Exchange Commission.

 

LOGO

Rex L. Smith, III

President and Chief Executive Officer

Community Bankers Trust Corporation

Neither the Securities and Exchange Commission nor any state securities commission or bank regulatory agency has approved or disapproved the United Bankshares common stock to be issued under this document or passed upon the adequacy or accuracy of this document. Any representation to the contrary is a criminal offense.

The securities to be issued in the merger are not savings accounts, deposits or other obligations of any bank or savings association and are not insured by the Federal Deposit Insurance Corporation, or any other governmental agency.

The date of this document is October 5, 2021, and it is first being mailed or otherwise delivered to Community Bankers Trust shareholders on or about October 8, 2021.


Table of Contents

LOGO

NOTICE OF SPECIAL MEETING OF SHAREHOLDERS TO BE HELD ON NOVEMBER 16, 2021

On November 16, 2021, Community Bankers Trust Corporation, or Community Bankers Trust, will hold a special meeting of shareholders at 10:00 a.m., local time, at:

Deep Run 3 Building, 9954 Mayland Drive, Richmond, Virginia 23233

to consider and vote upon the following matters:

 

  (1)

a proposal to approve the Agreement and Plan of Reorganization, dated as of June 2, 2021, by and between United Bankshares, Inc. and Community Bankers Trust, and related plan of merger, as each may be amended from time to time, or the merger agreement, a copy of which is attached as Appendix A to the accompanying prospectus and proxy statement;

 

  (2)

a proposal to approve, in a non-binding advisory vote, certain compensation that may become payable to Community Bankers Trust’s named executive officers in connection with the merger; and

 

  (3)

a proposal to approve the adjournment, postponement or continuance of the special meeting on one or more occasions, if necessary or appropriate, in order to further solicit additional proxies, in the event that there are not sufficient votes at the time of the special meeting to approve the merger agreement.

The Community Bankers Trust board of directors has fixed the close of business on September 27, 2021, as the record date for the special meeting. Only Community Bankers Trust shareholders of record at that time are entitled to notice of, and to vote at, the special meeting, or any adjournment, postponement or continuance of the special meeting. Adoption of each proposal requires the affirmative vote of a majority of the shares represented in person or by proxy at the special meeting if a quorum is established. The presence, in person or by proxy, of the holders of a majority of the outstanding shares of Community Bankers Trust common stock entitled to vote is necessary to constitute a quorum at the special meeting.

Whether or not you plan to attend the special meeting, please vote your shares as soon as possible. If you are a shareholder of record, you may vote your shares by submitting your proxy card by mail, by accessing the Internet site listed on the Community Bankers Trust proxy card, or by voting telephonically using the phone number listed on the Community Bankers Trust proxy card. To submit your proxy by mail, please complete, sign, date and return the accompanying proxy card in the enclosed self-addressed, stamped envelope. This will not prevent you from voting in person, but it will help to secure a quorum and avoid added solicitation costs. Any holder of record of Community Bankers Trust common stock who is present at the special meeting may vote in person instead of by proxy, thereby canceling any previous proxy. In any event, a proxy may be revoked at any time before the special meeting in the manner described in the accompanying document.

If you beneficially hold your shares through a bank, broker, nominee or other holder of record, please vote your shares as soon as possible by following the voting instructions you receive from such holder of record.

The Community Bankers Trust board of directors has unanimously adopted and approved the merger and the merger agreement and recommends that Community Bankers Trust shareholders vote “FOR” the proposals set forth herein.

 

By Order of the Board of Directors,

LOGO

 

John M. Oakey, III

Secretary

YOUR VOTE IS IMPORTANT. PLEASE VOTE YOUR SHARES PROMPTLY, REGARDLESS OF WHETHER YOU PLAN TO ATTEND THE SPECIAL MEETING.


Table of Contents

REFERENCES TO ADDITIONAL INFORMATION

This prospectus and proxy statement is part of a registration statement filed by United Bankshares with the Securities and Exchange Commission, or the SEC, under the Securities Act of 1933, as amended, or the Securities Act, that registers the shares of United Bankshares common stock to be issued to shareholders of Community Bankers Trust in the merger. The registration statement, including the exhibits and schedules attached to the registration statement, contains additional relevant information about United Bankshares and its common stock, Community Bankers Trust and the combined company. The rules and regulations of the SEC allow United Bankshares to omit some information included in the registration statement from this prospectus and proxy statement. The registration statement incorporates by reference important business and financial information about United Bankshares and Community Bankers Trust from documents that are not included in or delivered with this document.

You can obtain documents incorporated by reference in this document free of charge through the SEC website (http://www.sec.gov) or by requesting them in writing or by telephone from United Bankshares or Community Bankers Trust at the following addresses and telephone numbers:

 

United Bankshares, Inc.

514 Market Street

Parkersburg, West Virginia 26102

Attention: Shelli Adams

Telephone: (304) 424-8800

  

Community Bankers Trust Corporation

9954 Mayland Drive

Richmond, Virginia 23233

Attention: John M. Oakey, III

Telephone: (804) 934-9999

  

Morrow Sodali LLC

509 Madison Avenue, Suite 1206

New York, New York 10022

Telephone: (800) 662-5200

You will not be charged for any of these documents that you request. Community Bankers Trust shareholders requesting documents should do so by November 9, 2021, in order to receive them before their special meeting.

You should rely only on the information contained in or incorporated by referenced into this document. No one has been authorized to provide you with information or make any representation about the merger or United Bankshares or Community Bankers Trust that differs from, or adds to, the information in or incorporated by reference into this document. United Bankshares or Community Bankers Trust take no responsibility for, and provide no assurance as to the reliability of, any other information that others may give you. This document is dated October 5, 2021, and you should assume that the information in this document is accurate only as of such date. Neither the mailing of this document to Community Bankers Trust shareholders nor the issuance by United Bankshares of shares of United Bankshares common stock in connection with the merger will create any implication to the contrary.

Information on the websites of United Bankshares or Community Bankers Trust, or any subsidiary of United Bankshares or Community Bankers Trust, is not part of this document. You should not rely on that information in deciding how to vote.

This document does not constitute an offer to sell, or a solicitation of an offer to buy, any securities, or the solicitation of a proxy, in any jurisdiction to or from any person to whom it is unlawful to make any such offer or solicitation in such jurisdiction. Except where the context otherwise indicates, information contained in this document regarding Community Bankers Trust has been provided by Community Bankers Trust and information contained in this document regarding United Bankshares has been provided by United Bankshares.

See “Where You Can Find More Information” on page 99.


Table of Contents
     Page  

QUESTIONS AND ANSWERS

     1  

SUMMARY

     6  

RISK FACTORS

     16  

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

     23  

EQUIVALENT PRO FORMA MARKET VALUE OF COMMON STOCK

     25  

COMPARATIVE HISTORICAL AND PRO FORMA UNAUDITED SHARE DATA

     25  

THE SPECIAL MEETING

     28  

Matters to Be Considered

     28  

Proxies

     28  

Solicitation of Proxies

     29  

Record Date

     29  

Quorum and Voting Rights

     29  

Attending the Special Meeting

     30  

PROPOSALS TO BE CONSIDERED AT THE SPECIAL MEETING

     31  

PROPOSAL NO. 1 APPROVAL OF THE MERGER AGREEMENT

     31  

Required Vote

     31  

Recommendation of the Community Bankers Trust Board of Directors

     31  

PROPOSAL NO. 2 ADVISORY (NON-BINDING) VOTE ON CERTAIN MERGER-RELATED COMPENSATION FOR COMMUNITY BANKERS TRUST NAMED EXECUTIVE OFFICERS

     31  

Required Vote

     32  

Recommendation of the Community Bankers Trust Board of Directors

     32  

PROPOSAL NO. 3 APPROVAL OF THE ADJOURNMENT, POSTPONEMENT OR CONTINUANCE OF THE SPECIAL MEETING, IF NECESSARY, TO PERMIT FURTHER SOLICITATION OF PROXIES

     32  

Required Vote

     33  

Recommendation of the Community Bankers Trust Board of Directors

     33  

THE MERGER

     33  

Background of the Merger

     33  

Community Bankers Trust’s Reasons for the Merger; Recommendation of the Community Bankers Trust Board of Directors

     38  

United Bankshares’ Reasons for the Merger;

     41  

Opinion of Community Bankers Trust’s Financial Advisor

     42  

Certain Unaudited Prospective Financial Information

     54  

Public Trading Markets

     57  

No Dissenters’ or Appraisal Rights

     57  

Interests of Certain Community Bankers Trust Directors and Executive Officers in the Merger

     58  

Accounting Treatment of the Merger

     63  

THE MERGER AGREEMENT

     63  

Terms of the Merger

     63  

Treatment of Community Bankers Trust Stock Options

     64  

Treatment of Community Bankers Trust Restricted Stock Units

     64  

Conditions of the Merger

     64  

Representations and Warranties

     66  

Waiver and Amendment

     68  

Indemnification; Directors’ and Officers’ Insurance

     68  

Special Meeting; Board Recommendation

     68  

Acquisition Proposals

     69  

Effective Time

     70  

Regulatory Approvals

     70  

Conduct of Business Pending the Merger

     72  

Termination of the Merger Agreement

     74  


Table of Contents
     Page  

Effect of Termination; Termination Fee

     75  

Surrender of Stock Certificates

     76  

No Fractional Shares

     77  

Assumption of Community Bankers Trust Trust Preferred Securities

     77  

No Dissenters’ or Appraisal Rights

     78  

Accounting Treatment

     78  

Management and Operations after the Merger; Advisory Board

     78  

Resales of United Bankshares Common Stock

     78  

MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCES OF THE MERGER

     79  

General

     79  

The Merger

     79  

Consequences to Community Bankers Trust and United Bankshares

     80  

Consequences to Shareholders

     80  

Backup Withholding and Reporting Requirements

     80  

INFORMATION ABOUT UNITED BANKSHARES AND COMMUNITY BANKERS TRUST

     81  

United Bankshares

     81  

Community Bankers Trust

     82  

DESCRIPTION OF UNITED BANKSHARES CAPITAL STOCK

     82  

General

     82  

Common Stock

     83  

Preferred Stock

     84  

Preemptive Rights

     84  

Certain Provisions of the Bylaws

     85  

Shares Eligible for Future Sale

     85  

COMPARATIVE RIGHTS OF SHAREHOLDERS

     86  

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT OF UNITED BANKSHARES

     94  

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT OF COMMUNITY BANKERS TRUST

     96  

LEGAL MATTERS

     97  

EXPERTS

     97  

COMMUNITY BANKERS TRUST ANNUAL MEETING SHAREHOLDER PROPOSALS

     97  

WHERE YOU CAN FIND MORE INFORMATION

     99  

APPENDICES

  

APPENDIX  A — Agreement and Plan of Reorganization, dated as of June 2, 2021, by and between United Bankshares, Inc. and Community Bankers Trust Corporation

     A-1  

APPENDIX B — Opinion of Piper Sandler & Co.

     B-1  


Table of Contents

QUESTIONS AND ANSWERS

The following are answers to certain questions that you may have regarding the special meeting and the merger. United Bankshares and Community Bankers Trust urge you to read carefully the remainder of this document, including the risk factors beginning on page 16, because the information in this section may not provide all the information that might be important to you in determining how to vote. Additional important information is also contained in the appendices to, and the documents incorporated by reference in, this document.

 

Q:

What are holders of Community Bankers Trust common stock being asked to vote on?

 

A:

Holders of Community Bankers Trust common stock are being asked to vote to (i) approve the Agreement and Plan of Reorganization, dated as of June 2, 2021, by and between United Bankshares and Community Bankers Trust, and related plan of merger, or merger agreement, as each may be amended from time to time, or the Merger Proposal, (ii) approve, in a non-binding advisory vote, certain compensation that may become payable to Community Bankers Trust’s named executive officers in connection with the merger, or the Merger-Related Compensation Proposal, and (iii) approve the adjournment, postponement or continuance of the special meeting, on one or more occasions, if necessary or appropriate, in order to further solicit additional proxies, in the event that there are not sufficient votes at the time of the special meeting to approve the Merger Proposal, or the Adjournment Proposal. The merger agreement is attached to this prospectus and proxy statement as Appendix A and is incorporated by reference into this prospectus and proxy statement.

 

Q:

When and where is the special meeting of shareholders?

 

A:

The special meeting of Community Bankers Trust shareholders will be held at the Deep Run 3 Building, 9954 Mayland Drive, Richmond, Virginia 23233 on November 16, 2021 at 10:00 a.m., local time.

 

Q:

What constitutes a quorum for the special meeting?

 

A:

The presence at the special meeting, in person or by proxy, of the holders of a majority of the Community Bankers Trust common stock issued and outstanding and entitled to vote at the meeting will constitute a quorum for the transaction of business. If a quorum is not present, the special meeting will be postponed until the holders of the number of shares of Community Bankers Trust common stock required to constitute a quorum attend. If you submit a properly executed proxy card, even if you abstain from voting, your shares of Community Bankers Trust common stock will be counted for purposes of determining whether a quorum is present at the special meeting. If additional votes must be solicited to approve the merger agreement and the Adjournment Proposal is approved, it is expected that the special meeting will be adjourned to solicit additional proxies.

 

Q:

What do holders of Community Bankers Trust common stock need to do now?

 

A:

After you have carefully read this document and have decided how you wish to vote your shares, please vote your shares as soon as possible. If you are a shareholder of record, to vote by proxy card, indicate on your proxy card how you want your shares to be voted with respect to each of the matters indicated. When complete, sign, date and mail your proxy card in the enclosed postage-paid return envelope as soon as possible. Alternatively, you may vote by telephone or through the Internet by following the voting instructions found on your proxy card. If you beneficially hold your shares through a bank, broker, nominee or other holder of record, you should follow the voting instructions you receive from that holder of record to vote your shares.

Submitting your proxy by Internet, telephone or mail or directing your bank or broker to vote your shares will ensure that your shares are represented and voted at the special meeting. If you would like to attend the special meeting, see “The Special Meeting – Attending the Special Meeting” beginning on page 30.

 

1


Table of Contents
Q:

Who may solicit proxies on Community Bankers Trust’s behalf?

 

A:

In addition to solicitation of proxies by Community Bankers Trust by mail, proxies may also be solicited by Community Bankers Trust’s directors and employees personally, and by telephone, email, facsimile or other means. Community Bankers Trust has also made arrangements with Morrow Sodali LLC to assist it in soliciting proxies. For more information on solicitation of proxies in connection with the special meeting of Community Bankers Trust shareholders, see “The Special Meeting - Solicitation of Proxies” beginning on page 29.

 

Q:

Why is my vote as a holder of Community Bankers Trust common stock important?

 

A:

If you do not vote by proxy card, telephone or Internet or vote in person at the special meeting, it will be more difficult for Community Bankers Trust to obtain the necessary quorum to hold its special meeting. The presence, in person or by proxy, of the holders of a majority of the outstanding shares of Community Bankers Trust common stock entitled to vote is necessary to constitute a quorum at the special meeting. In addition, approval of the Merger Proposal requires the affirmative vote of a majority of the shares represented in person or by proxy at the special meeting if a quorum is established. The Community Bankers Trust board of directors recommends that you vote to approve the Merger Proposal. Further, due to the importance of the vote to approve the Merger Proposal, Community Bankers Trust is also seeking, through the Adjournment Proposal, authority from shareholders to adjourn the special meeting to temporarily delay the meeting to provide time for Community Bankers Trust to solicit additional proxies in the event there are insufficient votes to approve the Merger Proposal.

 

Q:

If my shares are held in street name by my broker, will my broker automatically vote my shares for me?

 

A:

No. Your broker cannot vote your shares without instructions from you. You should instruct your broker as to how to vote your shares, following the directions your broker provides to you. Please check the voting form used by your broker. Without instructions, your shares will not be voted, which will have the effect described below.

 

Q:

What if I abstain from voting or fail to instruct my broker or other holder of record how to vote?

 

A:

If you are a holder of Community Bankers Trust common stock and you submit a proxy card in which you abstain from voting, the abstention will be counted toward a quorum at the special meeting and it will have the same effect as a vote against the Merger Proposal, the Merger-Related Compensation Proposal and the Adjournment Proposal. If a quorum is present and a shareholder is not otherwise present or represented by proxy at the special meeting, a failure to vote such shareholder’s shares will have no effect on the outcome of the Merger Proposal, the Merger-Related Compensation Proposal and the Adjournment Proposal.

If your bank, broker, nominee or other holder of record holds your shares of Community Bankers Trust common stock in “street name,” for each proposal your bank, broker, nominee or other holder of record generally will return a proxy card and vote such shares only if you provide instructions on how to vote by filling out the voter instruction form sent to you by your broker, bank, nominee or other holder of record with this prospectus and proxy statement. Your shares held in “street name” generally will not be voted on any proposal with respect to which you do not provide voting instructions (referred to as broker non-votes) and will not be considered present at the special meeting for purposes of establishing a quorum. Broker non-votes will have no effect for determining whether the Merger Proposal, the Merger-Related Compensation Proposal and the Adjournment Proposal have been approved.

 

Q:

Can I attend the special meeting and vote my shares in person?

 

A:

Yes. All holders of Community Bankers Trust common stock, including shareholders of record and shareholders who beneficially own their shares through banks, brokers, nominees or any other holder of

 

2


Table of Contents
  record, are invited to attend the special meeting. Holders of record of Community Bankers Trust common stock as of the record date can vote in person at the special meeting. If you wish to vote in person at the special meeting and if you are a shareholder of record, you should bring the enclosed proxy card and proof of identity. If your shares are held in “street name” in a stock brokerage account or by a bank or other custodian, you should provide the record holder of your shares with instructions on how to vote your shares. Please follow the voting instructions provided by your broker, bank or other custodian. Please note that you may not vote shares held in street name by returning a proxy card directly to Community Bankers Trust or by voting online during the special meeting unless you provide a legal proxy, which you must obtain from your broker, bank or other custodian and, in the case of voting online, you register in advance for the appropriate online meeting of shareholders. At the appropriate time during the special meeting, the shareholders present will be asked whether anyone wishes to vote in person. You should raise your hand at this time to receive a ballot to record your vote. Everyone who attends the special meeting must abide by the rules for the conduct of the meeting distributed at the meeting.

Even if you plan to attend the special meeting, you are encouraged to vote your shares as soon as possible.

 

Q:

Will Community Bankers Trust be required to submit the Merger Proposal to its shareholders even if the Community Bankers Trust board of directors has withdrawn or modified its recommendation?

 

A:

Yes. Unless the merger agreement is terminated before the special meeting, Community Bankers Trust is required to submit the Merger Proposal to its shareholders even if the Community Bankers Trust board of directors has withdrawn or modified its recommendation, consistent with the terms of the merger agreement.

 

Q:

Is the merger expected to be taxable to Community Bankers Trust shareholders?

 

A:

Generally, no. The merger is structured to be treated as a “reorganization” within the meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended, or the Code, and holders of Community Bankers Trust common stock will not recognize any gain or loss for United States federal income tax purposes on the exchange of shares of Community Bankers Trust common stock for shares of United Bankshares common stock in the merger, except with respect to any cash received instead of fractional shares of United Bankshares common stock. You should read “Material U.S. Federal Income Tax Consequences of the Merger” beginning on page 79 for a more complete discussion of the United States federal income tax consequences of the merger. Tax matters can be complicated and the tax consequences of the merger to you will depend on your particular tax situation. You should consult your tax advisor to determine the specific tax consequences of the merger to you.

 

Q:

If I am a holder of Community Bankers Trust common stock, can I change or revoke my vote?

 

A:

Yes. If you are a shareholder of record of common stock, you may change your vote and revoke your proxy by:

 

   

before the meeting, voting by telephone or the Internet at a later time;

 

   

before the meeting, submitting a properly signed proxy card with a later date;

 

   

voting in person at the special meeting subject to proof of identity; or

 

   

delivering written notice that you wish to revoke your proxy to the Secretary of Community Bankers Trust Corporation at 9954 Mayland Drive, Suite 2100, Richmond, Virginia 23233, at or before the special meeting. You must include your control number.

If you hold shares in street name, you must follow your broker’s instructions to change your vote. Any record holder of Community Bankers Trust common stock, or street name holder with a written proxy from the record holder, entitled to vote in person at the special meeting may vote in person regardless of whether a proxy has been previously given, but the mere presence of a shareholder at the special meeting will not constitute revocation of a previously given proxy.

 

3


Table of Contents
Q:

If I am a Community Bankers Trust shareholder, do I have appraisal or dissenters’ rights?

 

A:

No. Under Virginia law, holders of Community Bankers Trust common stock will not be entitled to exercise any appraisal or dissenters’ rights in connection with any of the proposals being presented to them.

 

Q:

If I am a holder of Community Bankers Trust common stock with shares represented by stock certificates, should I send in my Community Bankers Trust stock certificates now?

 

A:

No. You should not send in your Community Bankers Trust stock certificates at this time. After completion of the merger, United Bankshares will send you instructions for exchanging Community Bankers Trust stock certificates for the merger consideration. The shares of United Bankshares common stock that Community Bankers Trust shareholders will receive in the merger will be issued in book-entry form. Please do not send in your stock certificates with your proxy card.

 

Q:

What should I do if I hold my shares of Community Bankers Trust common stock in book-entry form?

 

A:

After the completion of the merger, United Bankshares will send you instructions for exchanging shares of Community Bankers Trust common stock held in book-entry form for shares of United Bankshares common stock in book-entry form and cash to be paid instead of fractional shares of United Bankshares common stock.

 

Q:

Can I place my Community Bankers Trust stock certificate(s) into book-entry form prior to the merger?

 

A:

Yes. Community Bankers Trust stock certificates can be placed into book-entry form prior to the merger. For more information, please contact Community Bankers Trust’s transfer agent, Continental Stock Transfer & Trust Company, at (212) 509-4000.

 

Q:

Who can I contact if I cannot locate my Community Bankers Trust stock certificate(s)?

 

A:

If you are unable to locate your original Community Bankers Trust stock certificate(s), you should contact Community Bankers Trust’s transfer agent, Continental Stock Transfer & Trust Company, at (212) 509-4000.

 

Q:

When do you expect to complete the merger?

 

A:

United Bankshares and Community Bankers Trust expect to complete the merger promptly following receipt of all necessary approvals. However, they cannot assure you when or if the merger will occur. United Bankshares and Community Bankers Trust must, among other things, obtain the required approval of Community Bankers Trust shareholders at the special meeting and the required regulatory approvals described below in “The Merger Agreement—Conditions of the Merger” beginning on page 64.

 

Q:

What happens if the merger is not completed?

 

A:

If the merger is not completed, holders of Community Bankers Trust common stock will not receive any consideration for their shares in connection with the merger. Instead, Community Bankers Trust will remain an independent public company and its common stock will continue to be listed and traded on Nasdaq. In addition, in certain circumstances, a termination fee may be required to be paid by Community Bankers Trust. See “The Merger Agreement—Effect of Termination; Termination Fee” beginning on page 75 for a complete discussion of the circumstances under which termination fees will be required to be paid.

 

4


Table of Contents
Q:

Who will be soliciting proxies?

 

A:

In addition to soliciting proxies by mail, Community Bankers Trust may be soliciting proxies for the special meeting through its directors and certain employees personally, and by telephone, email, facsimile or other means. In addition, Community Bankers Trust has engaged Morrow Sodali LLC to assist with soliciting proxies on behalf of Community Bankers Trust. See “The Special Meeting—Solicitation of Proxies” beginning on page 29 for more information.

 

Q:

Whom should I call with questions?

 

A:

Community Bankers Trust shareholders should contact John M. Oakey, III at Community Bankers Trust by telephone at (804) 934-9999, or by e-mail at shareholder@essexbank.com, or Morrow Sodali LLC, Community Bankers Trust’s proxy solicitor, toll-free at (800) 662-5200.

 

5


Table of Contents

SUMMARY

This summary highlights selected information from this prospectus and proxy statement. It does not contain all of the information that may be important to you. We urge you to carefully read this entire prospectus and proxy statement and the other documents to which this prospectus and proxy statement refers to fully understand the merger and the other matters to be considered at the special meeting. See “Where You Can Find More Information” on page 99 to obtain the information incorporated by reference into this prospectus and proxy statement without charge. Each item in this summary includes a page reference directing you to a more complete description of that item.

The Merger (page 33)

We have attached the merger agreement to this prospectus and proxy statement as Appendix A. We encourage you to read the merger agreement. It is the legal document that governs the merger.

In the merger, United Bankshares will acquire Community Bankers Trust by means of the merger of Community Bankers Trust into United Bankshares. United Bankshares will be the surviving entity in the merger.

After the effective time of the merger and as part of the same overall transaction, Essex Bank, a Virginia corporation and a wholly-owned subsidiary of Community Bankers Trust, for no additional consideration and pursuant to the Agreement and Plan of Merger dated June 2, 2021, attached as Exhibit 99.4 to the registration statement on Form S-4 of which this prospectus and proxy statement is a part, will merge with and into United Bank, a Virginia banking corporation, and a wholly-owned subsidiary of United Bankshares, such transaction referred to hereinafter as the bank merger. As a result of the bank merger, the separate existence of Essex Bank will cease and the corporate existence of United Bank, as the merged bank, shall continue unaffected and unimpaired by the bank merger and the merged bank shall be deemed to be the same business and corporate entity as each of Essex Bank and United Bank.

Each share of Community Bankers Trust common stock outstanding will be converted in the merger into 0.3173 shares of United Bankshares common stock as further described below.

Exchange Ratio in the Merger (page 63)

Upon completion of the merger, each Community Bankers Trust shareholder will receive 0.3173 shares of United Bankshares common stock for each share of Community Bankers Trust common stock held immediately prior to the merger. We refer to this ratio as the exchange ratio. The aggregate number of shares of United Bankshares common stock to which a Community Bankers Trust shareholder will be entitled upon completion of the merger will equal 0.3173 multiplied by the number of shares of Community Bankers Trust common stock held by that Community Bankers Trust shareholder. However, United Bankshares will not issue any fractional shares. A Community Bankers Trust shareholder entitled to a fractional share of United Bankshares common stock will instead receive an amount in cash equal to the fraction of a whole share of United Bankshares common stock to which such shareholder would otherwise be entitled in an amount, without any interest thereon, equal to the product of (i) the volume-weighted average closing price on Nasdaq of United Bankshares common stock for the 20 full trading days ending on the second trading day immediately preceding the date on which the merger is completed multiplied by (ii) the fraction of a share of United Bankshares common stock that such holder would otherwise be entitled to receive. As an example, a holder of 10 shares of Community Bankers Trust common stock would receive 3 shares of United Bankshares common stock and an amount of cash equal to the product of 0.173 and the volume-weighted average closing price on Nasdaq of United Bankshares common stock for the 20 full trading days ending on the second trading day immediately preceding the date on which the merger is completed. A Community Bankers Trust shareholder whose direct shareholdings are represented by multiple Community Bankers Trust stock certificates will have all shares associated with those stock certificates


 

6


Table of Contents

aggregated for purposes of calculating whole shares and cash in lieu of fractional shares to be received upon completion of the merger.

The exchange ratio is a fixed ratio. Therefore, the number of shares of United Bankshares common stock to be received by holders of Community Bankers Trust common stock in the merger will not change if the trading price of United Bankshares common stock or the market value of Community Bankers Trust common stock changes between now and the time the merger is completed, except in limited circumstances where the trading price of United Bankshares common stock falls below certain thresholds when measured during a period shortly before the date that the merger is scheduled to be completed, in which case, Community Bankers Trust will have an opportunity to terminate the merger agreement if United Bankshares elects not to adjust the exchange ratio accordingly. If the average closing price of United Bankshares common stock declines by more than 20% from $41.71 and underperforms an index of banking companies by more than 20% over a designated measurement period, then Community Bankers Trust may terminate the merger agreement unless United Bankshares agrees to increase the number of shares to be issued or pay additional cash consideration to the holders of Community Bankers Trust common stock as part of the merger consideration.

Upon completion of the merger, we expect that United Bankshares shareholders will own approximately 94% of the combined company and former Community Bankers Trust shareholders will own approximately 6% of the combined company.

The market prices of both United Bankshares common stock and Community Bankers Trust common stock will fluctuate prior to the merger. You should obtain current stock price quotations for United Bankshares common stock.

Stock Options (page 64)

Under the merger agreement, at the effective time of the merger, each outstanding stock option to purchase Community Bankers Trust common stock granted under a Community Bankers Trust equity compensation plan that is outstanding and not yet exercised immediately prior to the merger, whether vested or unvested, will vest only as provided pursuant to the terms thereof and will be converted into an option to acquire, on the same terms and conditions as were applicable under such stock option, the number of shares of United Bankshares common stock equal to (a) the number of shares of Community Bankers Trust common stock subject to such stock option multiplied by (b) 0.3173. Such product shall be rounded down to the nearest whole number. The exercise price per share (rounded up to the next whole cent) of each United Bankshares stock option issued for the Community Bankers Trust stock option shall equal (y) the exercise price per share of shares of Community Bankers Trust common stock that were purchasable pursuant to such Community Bankers Trust stock option divided by (z) 0.3173.

Restricted Stock Units (page 64)

Under the merger agreement, at the effective time of the merger, each restricted stock unit grant and any other awards with respect to a shares of Community Bankers Trust common stock subject to vesting, repurchase or other lapse restriction under a Community Bankers Trust equity compensation plan that is outstanding immediately prior to the effective time of the merger other than a Community Bankers Trust stock option shall vest only in accordance with the formula and other terms of the award, be cancelled and converted automatically into the right to receive the merger consideration in respect of each share of Community Bankers Trust underlying such award. The shares of Community Bankers Trust common stock subject to such stock award will be treated in the same manner as all other shares of Community Bankers Trust common stock for such purposes. Any unvested restricted stock units that do not vest in accordance with a Community Bankers Trust equity compensation plan will be converted into restricted stock units of United Bankshares, as adjusted to take into account the exchange ratio.


 

7


Table of Contents

Community Bankers Trust’s Reasons for the Merger (page 38)

In reaching its decision to approve the merger agreement, the merger and the other transactions contemplated by the merger agreement, and to recommend that its shareholders approve the Merger Proposal, the Community Bankers Trust board of directors consulted with Community Bankers Trust management, as well as its financial and legal advisors, and considered a number of factors, including, but not limited to, each of the following: the value of the United Bankshares common stock consideration being offered to Community Bankers Trust shareholders, the anticipated future trading value of the United Bankshares common stock consideration, and the expected future receipt by Community Bankers Trust shareholders of dividends as United Bankshares shareholders; each of Community Bankers Trust’s, United Bankshares’, and the combined entity’s business, operations, financial condition and asset quality; the feasibility of, and the results that could be expected to be obtained, if Community Bankers Trust continued to operate independently; the process conducted by its financial advisors to assist the Community Bankers Trust board of directors in structuring the merger with United Bankshares; and the scale, scope, strength and diversity of operations that could be achieved by combining Community Bankers Trust with United Bankshares. For more detail concerning the factors considered by the Community Bankers Trust board of directors in reaching its decision to approve the merger agreement, see the section entitled “The Merger – Community Bankers Trust’s Reasons for the Merger; Recommendation of the Community Bankers Trust Board of Directors.”

Community Bankers Trust’s Recommendation (page 38)

The Community Bankers Trust board of directors believes that the merger is in the best interests of the Community Bankers Trust shareholders. Community Bankers Trust’s board of directors unanimously recommends that Community Bankers Trust shareholders vote “FOR” the Merger Proposal, the Merger-Related Compensation Proposal and the Adjournment Proposal. For the factors considered by the Community Bankers Trust board of directors in reaching its decision to approve the merger agreement, see the section entitled “The Merger – Community Bankers Trust’s Reasons for the Merger; Recommendation of the Community Bankers Trust Board of Directors.”

Opinion of Community Bankers Trust’s Financial Advisor (page 42 and Appendix B)

In considering whether to approve the merger, the Community Bankers Trust board of directors considered the opinion of its financial advisor, Piper Sandler & Co., or Piper Sandler, who delivered a written opinion to the Community Bankers Trust board of directors to the effect that, as of June 2, 2021, the exchange ratio was fair to the holders of Community Bankers Trust common stock from a financial point of view. We have attached the full text of this opinion, dated as of June 2, 2021, to this prospectus and proxy statement as Appendix B. You should read this opinion completely to understand the assumptions made, matters considered, qualifications and limitations of the review undertaken by Piper Sandler in providing its opinion.

Piper Sandler’s opinion is directed to Community Bankers Trust’s board of directors, addresses only the fairness of the exchange ratio pursuant to the merger agreement from a financial point of view to the holders of Community Bankers Trust common stock, and does not address any other aspect of the merger or constitute a recommendation as to how any Community Bankers Trust shareholder should vote at the special meeting held in connection with the merger.

United Bankshares’ Reasons for the Merger (page 41)

In reaching its decision to adopt and approve the merger agreement, the merger and the other transactions contemplated by the merger agreement, the United Bankshares board of directors evaluated the merger agreement, the merger and the other transactions contemplated by the merger agreement in consultation with United Bankshares management, as well as United Bankshares’ financial and legal advisors, and considered a number of factors, including, but not limited to, the following: each of United Bankshares’, Community Bankers


 

8


Table of Contents

Trust’s and the combined entity’s business, operations, financial condition, asset quality, earnings and prospects; Community Bankers Trust’s familiarity with the Virginia and Maryland markets; and management’s expectation regarding cost synergies, accretion and internal rate of return. For more detail concerning the factors considered by the United Bankshares board of directors in reaching its decision to approve the merger agreement, see the section entitled “The Merger – United Bankshares’ Reasons for the Merger.”

No Dissenters’ or Appraisal Rights (page 57)

The shareholders of Community Bankers Trust will not have any dissenters’ or appraisal rights in connection with the merger and the other matters described in this prospectus and proxy statement.

Accounting Treatment (page 63)

United Bankshares will account for the merger using acquisition accounting in accordance with U.S. generally accepted accounting principles.

Material U.S. Federal Income Tax Consequences (page 79)

The merger is structured to qualify as a tax-free reorganization for U.S. federal income tax purposes. Community Bankers Trust shareholders will not recognize any gain or loss for U.S. federal income tax purposes as a result of their exchange of shares of Community Bankers Trust common stock solely for shares of United Bankshares common stock. Community Bankers Trust shareholders may, however, have to recognize gain in connection with the receipt of any cash received in lieu of fractional shares in the merger. Because this tax treatment may not apply to all Community Bankers Trust shareholders, you should consult your own tax advisor for a full understanding of the merger’s tax consequences that are particular to you. It is a condition to United Bankshares’ and Community Bankers Trust’s obligation to complete the merger that we receive a legal opinion that the merger will be treated for U.S. federal income tax purposes as a reorganization under Section 368 of the Code. This opinion, however, will not bind the Internal Revenue Service, which could take a different view.

Shareholders will also be required to file certain information with their federal income tax returns and to retain certain records with regard to the merger.

The discussion of U.S. federal income tax consequences set forth above is for general information only and does not purport to be a complete analysis or listing of all potential tax effects that may apply to a holder of Community Bankers Trust common stock. Shareholders of Community Bankers Trust are strongly urged to consult their tax advisors to determine the particular tax consequences to them of the merger, including the application and effect of federal, state, local, foreign and other tax laws.

The Companies (page 81)

United Bankshares, Inc.

500 Virginia Street, East

Charleston, West Virginia 25301

(304) 348-8400

United Bankshares is a West Virginia corporation registered as a bank holding company pursuant to the Bank Holding Company Act of 1956, as amended, or the BHCA. United Bankshares elected to be a financial holding company that became effective April 2, 2017. United Bankshares was incorporated and organized in 1982 and began conducting business in 1984 with the acquisition of three wholly-owned subsidiaries. Since its formation in 1982, United Bankshares has acquired 32 banking institutions. United Bankshares has one banking subsidiary, United Bank, operating under the laws of Virginia. United Bankshares’ banking subsidiary offers a full range of commercial and retail banking services and products. United Bank operates 203 full service and


 

9


Table of Contents

limited service offices – located throughout North Carolina, South Carolina, West Virginia, the Shenandoah Valley Region of Virginia and the Northern Virginia, Maryland and Washington, D.C. areas, southwestern Pennsylvania and southeastern Ohio. United Bankshares also owns nonbank subsidiaries that engage in other community banking services such as asset management, real property title insurance, investment banking, financial planning and brokerage services.

The headquarters of United Bankshares is located in United Center at 500 Virginia Street, East, Charleston, West Virginia. United Bankshares’ executive offices are located in Parkersburg, West Virginia at Fifth and Avery Streets.

United Bankshares’ website can be accessed at https://www.ubsi-inc.com. Information contained on the websites of United Bankshares or any subsidiary of United Bankshares does not constitute a part of this prospectus and proxy statement and is not incorporated into other filings that United Bankshares makes with the SEC. United Bankshares’ common stock is traded on Nasdaq under the symbol “UBSI”.

As of June 30, 2021, United Bankshares had total assets of $27.2 billion, total deposits of $21.6 billion, and shareholders’ equity of $4.4 billion.

Community Bankers Trust Corporation

9954 Mayland Drive

Suite 2100

Richmond, Virginia 23233

(804) 934-9999

Community Bankers Trust is Virginia corporation registered as a bank holding company pursuant to the BHCA. Community Bankers Trust provides financial services through its community bank subsidiary, Essex Bank, a Virginia banking corporation that was established in 1926. Essex Bank currently operates 24 banking offices in Northern Virginia and Maryland.

The principal executive offices of Community Bankers Trust are located at 9954 Mayland Drive, Suite 2100, Richmond, Virginia 23233, and its telephone number is (804) 934-9999. Community Bankers Trust’s website can be accessed at http://www.cbtrustcorp.com. Information contained on the websites of Community Bankers Trust or any subsidiary of Community Bankers Trust does not constitute a part of this prospectus and proxy statement and is not incorporated into other filings that Community Bankers Trust makes with the SEC. Community Bankers Trust’s common stock is traded on Nasdaq under the symbol “ESXB”.

As of June 30, 2021, Community Bankers Trust had total assets of $1.75 billion, total deposits of $1.49 billion, and total shareholders’ equity of $179.7 million.

The Community Bankers Trust Shareholder Meeting (page 28)

The special meeting will be held on November 16, 2021 at 10:00 a.m. at the Deep Run 3 Building, 9954 Mayland Drive, Richmond, Virginia 23233. At the special meeting, Community Bankers Trust shareholders will be asked:

 

   

To approve the Merger Proposal;

 

   

To approve the Merger-Related Compensation Proposal; and

 

   

To approve the Adjournment Proposal.

Community Bankers Trust Record Date; Vote Required (page 29)

Community Bankers Trust shareholders can vote at the special meeting if they owned shares of Community Bankers Trust common stock at the close of business on September 27, 2021, which is the record date for the


 

10


Table of Contents

special meeting. On the record date, Community Bankers Trust had 22,464,593 shares of common stock outstanding and approximately 1,681 shareholders entitled to vote. Each Community Bankers Trust shareholder can cast one vote for each share of Community Bankers Trust common stock owned on that date.

The presence, in person or by proxy, of the holders of a majority of the outstanding shares of Community Bankers Trust common stock entitled to vote at the special meeting is necessary to constitute a quorum. Abstentions and shares of Community Bankers Trust common stock held of record by a broker or nominee that voted on any matter are counted as present and entitled to vote for purposes of determining a quorum. Under the rules that govern brokers who are voting with respect to shares held in street name, brokers or other nominees have the discretion to vote such shares on routine matters, but not on non-routine matters. In the case of non-routine items, the broker or other nominee holding street name shares cannot vote the shares if it has not received voting instructions. These are considered to be “broker non-votes.” Since there are no routine items to be voted on at the special meeting, brokers or nominees holding shares of Community Bankers Trust common stock that do not receive voting instructions from the beneficial owners of such shares will not be able to return a proxy card with respect to such shares. As a result, these shares will not be considered present at the special meeting and will not count towards the satisfaction of a quorum.

If a quorum exists, the approval of each of the Merger Proposal, the Merger-Related Compensation Proposal and the Adjournment Proposal, requires the affirmative vote of a majority of the shares represented in person or by proxy at the special meeting. Abstentions will have the same effect as a vote against these proposals. Broker non-votes will have no effect for determining whether these proposals have been approved.

As of the record date, directors and executive officers of Community Bankers Trust had the sole right to vote 609,677 shares of Community Bankers Trust common stock, or approximately 2.71% of the outstanding Community Bankers Trust common stock entitled to be voted at the special meeting. Community Bankers Trust directors have entered into support agreements that obligate each director to vote shares of Community Bankers Trust common stock over which each such director has sole voting and dispositive power for approval of the Merger Proposal. As of the close of business on September 27, 2021, the record date for the special meeting, shares constituting 2.32% of Community Bankers Trust common stock were subject to the support agreements.

Conditions to Completion of the Merger (page 64)

The obligations of United Bankshares and Community Bankers Trust to complete the merger depend on a number of conditions being satisfied or waived. These conditions include:

 

   

Community Bankers Trust shareholders’ approval of the merger agreement;

 

   

Approval of the merger by the necessary federal and state regulatory authorities;

 

   

The effectiveness of the registration statement filed on Form S-4 of which this prospectus and proxy statement is a part and the absence of any stop order suspending the effectiveness thereof or any proceedings for that purpose initiated or threatened by the SEC;

 

   

Authorization for the listing on Nasdaq of the shares of United Bankshares common stock to be issued in the merger;

 

   

Absence of any law or court order prohibiting the merger;

 

   

Receipt of opinions from counsel to Community Bankers Trust and United Bankshares that the merger will be treated as a “reorganization” under Section 368(a) of the Code;

 

   

Neither United Bank nor Rex L. Smith, III, President and Chief Executive Officer of Community Bankers Trust and Essex Bank, shall have taken any action on or before the effective time of the merger to materially breach or to cancel or terminate the employment agreement dated June 2, 2021 by and between Mr. Smith and United Bank;


 

11


Table of Contents
   

The accuracy of the other party’s representations and warranties subject to the material adverse effect standard in the merger agreement; and

 

   

The performance in all material respects of all obligations contained in the merger agreement.

We cannot be certain when, or if, the conditions to the merger will be satisfied or waived, or that the merger will be completed.

Regulatory Approvals (page 70)

We cannot complete the merger unless it is approved by the Board of Governors of the Federal Reserve System, or the Federal Reserve, and the Virginia Bureau of Financial Institutions. Once the Federal Reserve approves the merger, we have to wait from 15 to 30 days before we can complete it. During that time, the Department of Justice may challenge the merger. As of the date of this prospectus and proxy statement, United Bankshares and Community Bankers Trust have made all required applications for regulatory approval including a request for waiver from the application required by Section 3 of the Bank Holding Company Act of 1956, as amended. The Virginia Bureau of Financial Institutions approved the applications for the merger and bank merger on September 7, 2021. The application, and request for waiver, submitted to the Federal Reserve are still under review by the Federal Reserve. We cannot be certain when or if we will receive the approval of the Federal Reserve or, if obtained, whether it will contain terms, conditions or restrictions not currently contemplated that will be detrimental to the combined company after completion of the merger.

Under the merger agreement, United Bankshares is not required to agree to any condition or restriction or take any action or commit to take any action as part of any necessary regulatory approval if such agreements or the taking of such action would, in the reasonable good faith judgment of the United Bankshares Board, be materially financially burdensome to the business, operations, financial condition or results of operations of United Bankshares or Community Bankers Trust such that, had such condition or requirement been known, United would not, in its reasonable good faith judgment, have entered into the merger agreement, which we refer to as a materially burdensome regulatory condition.

Termination of the Merger Agreement (page 74)

Community Bankers Trust and United Bankshares may mutually agree to terminate the merger agreement at any time upon a vote by a majority of the board of directors of each of Community Bankers Trust and United Bankshares.

Either Community Bankers Trust or United Bankshares may terminate the merger agreement if the merger is not complete by May 31, 2022, unless the failure of the merger to be consummated arises out of or results from the knowing action or inaction of the party seeking to terminate.

Either Community Bankers Trust or United Bankshares may terminate the merger agreement if (i) final action has been taken by any governmental authority whose approval is required for consummation of the merger and the other transactions contemplated by the merger agreement, which final action has become nonappealable and does not approve the merger agreement or the transactions contemplated by the merger agreement, or such governmental authority has approved of the merger agreement or the transactions contemplated by the merger agreement with a materially burdensome regulatory condition, or (ii) an application submitted to any governmental authority whose approval is required for the consummation of the merger has been permanently withdrawn at the request or suggestion of such governmental authority (except to the extent that such action, denial or withdrawal or the imposition of such condition is due to the failure of the party seeking to terminate to perform or observe the covenants of such party).


 

12


Table of Contents

United Bankshares may terminate the merger agreement if any of the following occurs:

 

   

Community Bankers Trust materially breaches any of its representations, warranties, covenants or agreements under the merger agreement and does not or cannot cure the breach within 30 days of written notice of the breach;

 

   

The Community Bankers Trust shareholders do not approve the merger agreement;

 

   

As of May 31, 2022, (i) the continued accuracy of Community Bankers Trust’s representations and warranties in the merger agreement cannot be confirmed by Community Bankers Trust, (ii) the performance in all material respects of all of its obligations in the merger agreement cannot be confirmed by Community Bankers Trust, or (iii) Rex L. Smith, III, the President and Chief Executive Officer of Community Bankers Trust and Essex Bank, has taken action on or before the effective time of the merger to materially breach or to cancel or terminate the employment agreement between United Bank and Mr. Smith dated June 2, 2021 (provided that such failure is not a result of United Bankshares’ failure to perform, in any material respect, any of its covenants or agreements contained in the merger agreement or the material breach by United Bankshares of any of its representations or warranties contained in the merger agreement);

 

   

The Community Bankers Trust board of directors fails (i) to recommend approval of the merger agreement, or changes, withdraws, qualifies or modifies, or publicly proposes to change, withdraw, qualify or modify, in a manner that is adverse to United, (ii) to reaffirm its recommendation for approval of the merger agreement within ten (10) business days after United requests such reaffirmation in writing at any time following the public announcement of an acquisition proposal, or (iii) to comply in all material respects with its obligations under the merger agreement with respect to an acquisition proposal; or

 

   

Community Bankers Trust enters into any letter of intent, memorandum of understanding, agreement in principle, acquisition agreement, merger agreement, or other similar agreement constituting or related to, or which is intended to or would be reasonably likely to lead to any tender or exchange offer, proposal for a merger, consolidation or other business combination involving Community Bankers Trust or any of its significant subsidiaries or any proposal or offer to acquire equity interests representing 24.99% or more of the voting power of, or at least 24.99% of the assets or deposits of, Community Bankers Trust or any of its significant subsidiaries.

Community Bankers Trust may terminate the merger agreement if any of the following occurs:

 

   

United Bankshares materially breaches any of its representations, warranties, covenants or agreements under the merger agreement and does not or cannot cure the breach within 30 days of written notice of the breach;

 

   

The Community Bankers Trust shareholders do not approve the merger agreement;

 

   

As of May 31, 2022, United Bankshares is not able to confirm, (i) the continued accuracy of its representations and warranties in the merger agreement or (ii) the performance in all material respects of all of its obligations in the merger agreement (provided that such failure is not a result of Community Bankers Trust’s failure to perform, in any material respect, any of its covenants or agreements contained in the merger agreement or the material breach by Community Bankers Trust of any of its representations or warranties contained in the merger agreement); or

 

   

If both (i) the average of the closing sale prices of United Bankshares common stock, or the average United Bankshares stock price, as reported on Nasdaq during the 20 consecutive full trading days ending at the closing of trading on the trading day immediately prior to the latest of (A) the date on which the last regulatory approval necessary is received (and any statutory waiting period in respect thereof has expired) or (B) the latest date on which the Community Bankers


 

13


Table of Contents
 

Trust shareholders approve the merger, which date we refer to as the determination date, is less than $33.37, and (ii) (1) the quotient of the average United Bankshares stock price divided by $41.71, shall be less than 80% of (2) the quotient of the average of the daily current market price of the KBW Regional Banking Index, or the Index, for the 20 consecutive full trading days ending at the closing of trading on the trading day immediately prior to the determination date divided by the closing price for the Index on June 1, 2021. If Community Bankers Trust elects to terminate under the provision described above, United Bankshares shall have the option to increase the exchange ratio or pay an additional cash payment to each Community Bankers Trust shareholder as part of the merger consideration.

Additionally, Community Bankers Trust may terminate the merger agreement in order to enter into an agreement with respect to an unsolicited acquisition proposal that if consummated would result in a transaction that is (i) more favorable to Community Bankers Trust shareholders from a financial point of view than the merger, (ii) fully financed or reasonably capable of being fully financed, (iii) reasonably likely to receive all required approvals of governmental authorities on a timely basis and (iv) otherwise reasonably capable of being completed on the terms proposed, provided that United Bankshares does not make a counteroffer that the Community Bankers Trust board of directors determines is at least as favorable to the other proposal and Community Bankers Trust pays the termination fee described below.

Termination Fees (page 75)

In the event that the merger agreement is terminated (i) by Community Bankers Trust in order to concurrently enter into an agreement with respect to an unsolicited acquisition proposal that is (a) more favorable to its shareholders from a financial point of view than the merger with United Bankshares, (b) fully financed or reasonably capable of being fully financed, (c) reasonably likely to receive all required governmental approvals on a timely basis and (d) otherwise reasonably capable of being completed on the terms proposed, and United Bankshares does not make a counteroffer that the Community Bankers Trust board of directors determines is at least as favorable to the unsolicited acquisition proposal or (ii) by United Bankshares because the Community Bankers Trust board of directors fails to recommend, withdraws, modifies or changes its recommendation of the merger in a manner adverse in any respect to the interests of United Bankshares and within 12 months after the date of termination of the merger agreement, Community Bankers Trust enters into an agreement with respect to another acquisition proposal or consummates another acquisition proposal, then Community Bankers Trust must pay United Bankshares a termination fee of $12,132,000.

Waiver and Amendment (page 68)

United Bankshares and Community Bankers Trust may jointly amend the merger agreement and each may waive its right to require the other party to adhere to the terms and conditions of the merger agreement. However, United Bankshares and Community Bankers Trust may not do so after Community Bankers Trust shareholders approve the merger agreement if the amendment or waiver would violate the Virginia Stock Corporation Act.

Interests of Directors and Executive Officers in the Merger that Differ from Your Interests (page 58)

Some of the directors and executive officers of Community Bankers Trust have interests in the merger that differ from, or are in addition to, their interests as shareholders of Community Bankers Trust. These interests exist because of, among other things, employment or severance agreements that the executive officers entered into with Community Bankers Trust, rights that these executive officers and directors have under Community Bankers Trust’s benefit plans including equity plans and deferred compensation plans, agreements or arrangements with United Bankshares or its subsidiaries, including United Bank, to continue or serve as employees, contractors and/or directors following the merger, and rights to indemnification and directors and


 

14


Table of Contents

officers insurance following the merger. The employment and severance agreements provide certain executive officers with severance benefits if their employment is terminated in connection with the merger. The aggregate compensation that certain Community Bankers Trust directors and named executive officers may receive as a result of the merger is described in greater detail under “Interests of Certain Community Bankers Trust Directors and Executive Officers in the Merger” beginning on page 58.

In addition, as of the record date of the special meeting, Community Bankers Trust directors and executive officers owned, in the aggregate, options to purchase 1,072,500 shares of Community Bankers Trust common stock and restricted stock units granted under a Community Bankers Trust equity compensation plan. The treatment of the options and restricted stock units is set forth in the merger agreement and described in greater detail under “Interests of Certain Community Bankers Trust Directors and Executive Officers in the Merger” beginning on page 58.

United Bankshares will invite all members of the Community Bankers Trust board of directors to serve on United Bank’s Richmond Advisory Board or another appropriate advisory board maintained by United Bankshares or United Bank for the region in which the individual resides.

The members of the Community Bankers Trust board of directors knew about these additional interests and considered them when they approved the merger agreement and the merger.

Material Differences in the Rights of United Bankshares Shareholders and Community Bankers Trust Shareholders (page 86)

The rights of United Bankshares shareholders are governed by West Virginia law and by United Bankshares’ articles of incorporation and bylaws. The rights of Community Bankers Trust shareholders are governed by Virginia law and by Community Bankers Trust’s articles of incorporation and bylaws. Upon completion of the merger, the rights of the United Bankshares shareholders, including former shareholders of Community Bankers Trust, will be governed by West Virginia law and the articles of incorporation and bylaws of United Bankshares.

This prospectus and proxy statement contains descriptions of the material differences in shareholder rights under each of the United Bankshares and Community Bankers Trust governing documents.


 

15


Table of Contents

RISK FACTORS

In addition to general investment risks and the other information contained in or incorporated by reference into this prospectus and proxy statement, including the matters addressed under the heading “Cautionary Statement Regarding Forward-Looking Statements” on page 23 and the matters described under the caption “Risk Factors” in the Annual Reports on Forms 10-K filed by United Bankshares and Community Bankers Trust for the year ended December 31, 2020, Community Bankers Trust shareholders should consider the matters described below in determining whether to approve the merger agreement.

Because the exchange ratio is fixed, fluctuations in the trading price of United Bankshares common stock will change the value of the shares of United Bankshares common stock Community Bankers Trust shareholders receive in the merger.

The exchange ratio is set at 0.3173 shares of United Bankshares common stock for each share of Community Bankers Trust common stock. As a result, the market value of the United Bankshares common stock that Community Bankers Trust shareholders receive in the merger will depend on the market price of United Bankshares common stock at the time the shares are issued. After the merger, the market value of United Bankshares common stock may decrease and be lower than the market value of United Bankshares common stock that was used in calculating the exchange ratio in the merger. Except as described in this prospectus and proxy statement, there will be no adjustment to the fixed number of shares of United Bankshares common stock that will be issued to Community Bankers Trust shareholders based upon changes in the market price of United Bankshares common stock or Community Bankers Trust common stock prior to the closing.

There may be an adjustment to the fixed number of shares of United Bankshares common stock that will be issued to Community Bankers Trust shareholders in limited circumstances if the market price of United Bankshares common stock falls more than 20% on an actual basis and 20% on a relative basis to the KBW Regional Banking Index (KRX) prior to the closing. However, any changes to the fixed number of shares of United Bankshares common stock will not increase the per share value that Community Bankers Trust shareholders will receive in the merger from the value calculated using the pre-announcement market price of United Bankshares common stock. The Community Bankers Trust board of directors may terminate the merger agreement if United Bankshares elects not to adjust the exchange ratio in the foregoing circumstances, in which case the merger will not occur.

The market price of United Bankshares common stock at the time the merger is completed may vary from the price of United Bankshares common stock on the date the merger agreement was executed, on the date of this prospectus and proxy statement and on the date of the special meeting as a result of various factors that are beyond the control of United Bankshares and Community Bankers Trust, including, but not limited to, general market and economic conditions, changes in our respective businesses, operations and prospects, and regulatory considerations. In addition to the approval of the merger agreement by Community Bankers Trust shareholders, completion of the merger is subject to receipt of required regulatory approvals and satisfaction of other conditions that may not occur until after the special meeting. Therefore, at the time of the special meeting, Community Bankers Trust shareholders will not know the precise value of the consideration they will receive at the effective time of the merger. Community Bankers Trust shareholders should obtain current market quotations for shares of United Bankshares common stock.

The market price of United Bankshares common stock after the merger may be affected by factors different from those affecting the shares of Community Bankers Trust or United Bankshares currently.

Upon completion of the merger, holders of Community Bankers Trust common stock will become holders of United Bankshares common stock. United Bankshares’ business differs from that of Community Bankers Trust, and, accordingly, the results of operations of the combined company and the market price of the combined company’s shares of common stock may be affected by factors different from those currently affecting the

 

16


Table of Contents

independent results of operations of each of United Bankshares and Community Bankers Trust. For a discussion of the businesses of United Bankshares and Community Bankers Trust and of certain factors to consider in connection with those businesses, see the documents incorporated by reference or described elsewhere in this prospectus and proxy statement.

The integration of the operations of United Bankshares and Community Bankers Trust may be more difficult, costly or time-consuming than anticipated.

The success of the merger will depend, in part, on United Bankshares’ ability to realize the anticipated benefits and cost savings from successfully combining the businesses of United Bankshares and Community Bankers Trust and to combine the businesses of United Bankshares and Community Bankers Trust in a manner that permits growth opportunities and cost savings to be realized without materially disrupting the existing customer relationships of Community Bankers Trust or decreasing revenues due to loss of customers. If United Bankshares is not able to achieve these objectives, the anticipated benefits and cost savings of the merger may not be realized fully or at all or may take longer to realize than expected.

It is possible that the integration process could result in the loss of key employees, the disruption of each company’s ongoing businesses or inconsistencies in standards, controls, procedures and policies that adversely affect the combined company’s ability to maintain relationships with clients, customers, depositors and employees or to achieve the anticipated benefits of the merger. The loss of key employees could adversely affect United Bankshares’ ability to successfully conduct its business in the markets in which Community Bankers Trust now operates, which could have an adverse effect on United Bankshares’ financial results and the value of its common stock. If United Bankshares experiences difficulties with the integration process, the anticipated benefits of the merger may not be realized fully or at all, or may take longer to realize than expected. As with any merger of financial institutions, there also may be business disruptions that cause Community Bankers Trust to lose customers or cause customers to remove their accounts from Community Bankers Trust and move their business to competing financial institutions. Integration efforts between the two companies will also divert management attention and resources. These integration matters could have an adverse effect on each of Community Bankers Trust and United Bankshares during this transition period and for an undetermined period after consummation of the merger.

The success of the merger will also depend on United Bankshares’ ability to:

 

   

Retain and attract qualified personnel to, United Bankshares and Community Bankers Trust;

 

   

Maintain existing relationships with depositors of Community Bankers Trust to minimize withdrawals of deposits prior to and subsequent to the merger;

 

   

Maintain and enhance existing relationships with borrowers to limit unanticipated losses from loans of Community Bankers Trust;

 

   

Control the incremental non-interest expense from United Bankshares to maintain overall operating efficiencies; and

 

   

Compete effectively in the communities served by United Bankshares and Community Bankers Trust and in nearby communities.

United Bankshares may not be able to manage effectively its growth resulting from the merger.

Regulatory approvals may not be received, may take longer than expected or impose conditions that are not presently anticipated.    

Before the merger may be completed, we must obtain various approvals or consents from the Federal Reserve and various bank regulatory and other authorities. These regulators may impose conditions on the completion of the merger or require changes to the terms of the merger.

 

17


Table of Contents

There can be no assurance that there will not be any conditions imposed or required changes to the terms of the merger required by the regulators, and such conditions or changes could have the effect of delaying completion of the merger or imposing additional costs on or limiting the revenues of United Bankshares following the merger. There can be no assurance as to whether the approval from the Federal Reserve will be received, the timing of the Federal Reserve’s approval, or whether any conditions will be imposed. The merger agreement contains a condition to the obligation of each of United Bankshares and Community Bankers Trust to close the merger that the required regulatory approvals not contain any materially burdensome regulatory condition. See “The Merger Agreement – Regulatory Approvals” on page 70.

United Bankshares may fail to realize the cost savings estimated for the merger.

Although United Bankshares estimates that it will realize cost savings of approximately $12.7 million annually (excluding one-time costs and expenses associated with the merger with Community Bankers Trust) from the merger when fully phased in, it is possible that the estimates of the potential cost savings could turn out to be incorrect. For example, the combined purchasing power may not be as strong as expected, and therefore the cost savings could be reduced. In addition, future business developments may require United Bankshares to continue to operate or maintain some facilities or support functions that are currently expected to be combined or reduced. The cost savings estimates also depend on United Bankshares’ ability to combine the businesses of United Bankshares and Community Bankers Trust in a manner that permits those costs savings to be realized. If the estimates turn out to be incorrect or United Bankshares is not able to combine the two companies successfully, the anticipated cost savings may not be fully realized or realized at all, or may take longer to realize than expected.

The merger may distract management of United Bankshares and Community Bankers Trust from their other responsibilities.

The merger could cause the respective management groups of United Bankshares and Community Bankers Trust to focus their time and energies on matters related to the transaction that otherwise would be directed to their business and operations. Any such distraction on the part of either company’s management, if significant, could affect its ability to service existing business and develop new business and adversely affect the business and earnings of United Bankshares or the business and earnings of the combined company.

If the merger is not completed, United Bankshares and Community Bankers Trust will have incurred substantial expenses without realizing the expected benefits of the merger.

Each of United Bankshares and Community Bankers Trust has incurred substantial expenses in connection with the negotiation and completion of the transactions contemplated by the merger agreement, as well as the costs and expenses of filing, printing and mailing this prospectus and proxy statement and all filing and other fees paid to the SEC in connection with the merger. If the merger is not completed, United Bankshares and Community Bankers Trust would have to recognize these expenses without realizing the expected benefits of the merger.

Community Bankers Trust shareholders will have less influence as shareholders of United Bankshares than as shareholders of Community Bankers Trust.

Community Bankers Trust shareholders currently have the right to vote in the election of the board of directors of Community Bankers Trust and on other matters affecting Community Bankers Trust. Following the merger, the shareholders of Community Bankers Trust as a group will own approximately 6% of the combined organization. When the merger occurs, each Community Bankers Trust shareholder that receives shares of United Bankshares common stock will become a shareholder of United Bankshares with a percentage ownership of the combined organization much smaller than such shareholder’s percentage ownership of Community Bankers Trust. Because of this, Community Bankers Trust shareholders will have less influence on the

 

18


Table of Contents

management and policies of United Bankshares than they now have on the management and policies of Community Bankers Trust.

Some of the directors and executive officers of Community Bankers Trust may have interests in the merger that differ from the interests of non-director or non-management shareholders.

The interests of some of the directors and executive officers of Community Bankers Trust may be different from those of other holders of Community Bankers Trust common stock, and directors and executive officers of Community Bankers Trust may be participants in arrangements that are different from, or in addition to, those of other holders of Community Bankers Trust common stock. These interests are described in more detail in the section entitled “The Merger – Interests of Certain Community Bankers Trust Directors and Executive Officers in the Merger” beginning on page 58.

The fairness opinion obtained by Community Bankers Trust from its financial advisor will not reflect changes in circumstances between the date of such opinion and the completion of the merger.

Community Bankers Trust has not obtained an updated fairness opinion as of the date of this prospectus and proxy statement from Piper Sandler & Co., Community Bankers Trust’s financial advisor. Changes in the operations and prospects of Community Bankers Trust or United Bankshares, general market and economic conditions and other factors that may be beyond the control of Community Bankers Trust and United Bankshares may alter the value of Community Bankers Trust or United Bankshares or the prices of shares of Community Bankers Trust common stock or United Bankshares common stock by the time the merger is completed. The opinion does not speak as of the time the merger will be completed or as of any date other than the date of such opinion. Because Community Bankers Trust does not anticipate asking its financial advisor to update its opinion, the June 2, 2021 opinion does not address the fairness of the exchange ratio, from a financial point of view, at the time the merger is completed. The opinion is included as Appendix B to this prospectus and proxy statement. For a description of the opinion that Community Bankers Trust received from its financial advisor, please refer to “The Merger – Opinion of Community Bankers Trust’s Financial Advisor” on page 42. For a description of the other factors considered by Community Bankers Trust’s board of directors in determining to approve the merger, please refer to “The Merger – Community Bankers Trust’s Reasons for the Merger; Recommendation of the Community Bankers Trust Board of Directors” on page 38.

The merger agreement limits Community Bankers Trust’s ability to pursue an alternative acquisition proposal and requires Community Bankers Trust to pay a termination fee of $12,132,000 under limited circumstances relating to alternative acquisition proposals.

The merger agreement prohibits Community Bankers Trust from soliciting, initiating, or encouraging certain alternative acquisition proposals with any third party, subject to exceptions set forth in the merger agreement. See “The Merger Agreement—Acquisition Proposals” on page 69. The merger agreement also provides for the payment by Community Bankers Trust of a termination fee in the amount of $12,132,000 in the event that the other party terminates the merger agreement for certain reasons. These provisions might discourage a potential competing acquiror that might have an interest in acquiring all or a significant part of Community Bankers Trust from considering or proposing such an acquisition. See “The Merger Agreement—Effect of Termination; Termination Fees” on page 75.

The merger will not be completed unless important conditions are satisfied.

Specified conditions set forth in the merger agreement must be satisfied or waived to complete the merger. If the conditions are not satisfied or waived, to the extent permitted by law or stock exchange rules, the merger will not occur or will be delayed and each of United Bankshares and Community Bankers Trust may lose some or all of the intended benefits of the merger. The following conditions, in addition to other closing conditions,

 

19


Table of Contents

must be satisfied or waived, if permissible, before United Bankshares and Community Bankers Trust are obligated to complete the merger:

 

   

The merger agreement and merger must be duly approved by the requisite vote of the shareholders of Community Bankers Trust;

 

   

All required regulatory approvals must be obtained;

 

   

The absence of any law or order by a court or governmental authority that prohibits consummation of the merger;

 

   

Neither Rex L. Smith, III, President and Chief Executive Officer of Community Bankers Trust and Essex Bank, nor United Bank shall have taken any action on or before the effective time of the merger to materially breach or to cancel or terminate the employment agreement between Mr. Smith and United Bank dated June 2, 2021;

 

   

The registration statement on Form S-4 shall become effective under the Securities Act and no stop order shall have been issued or threatened by the SEC; and

 

   

To the extent required, the shares of United Bankshares common stock to be issued in the merger must be approved for listing on Nasdaq.

Some of the conditions to the merger may be waived by United Bankshares or Community Bankers Trust without resoliciting shareholder approval of the merger agreement.

Some of the conditions set forth in the merger agreement may be waived by United Bankshares or Community Bankers Trust, subject to the agreement of the other party in specific cases. See “The Merger Agreement – Conditions to of the Merger.” If any conditions are waived, Community Bankers Trust or United Bankshares, as applicable, will evaluate whether an amendment of this prospectus and proxy statement and resolicitation of proxies is warranted. In the event that the board of directors of Community Bankers Trust or United Bankshares determines that resolicitation of its shareholders is not warranted, United Bankshares and Community Bankers Trust will have the discretion to complete the transaction without seeking further Community Bankers Trust shareholder approval.

Termination of the merger agreement could negatively impact Community Bankers Trust or United Bankshares.

If the merger agreement is terminated, there may be various consequences. For example, Community Bankers Trust’s businesses may have been impacted adversely by the failure to pursue other beneficial opportunities due to the focus of management on the merger, without realizing any of the anticipated benefits of completing the merger. If the merger agreement is terminated and Community Bankers Trust’s board of directors seeks another merger or business combination, Community Bankers Trust shareholders cannot be certain that Community Bankers Trust will be able to find a party willing to pay the equivalent or greater consideration than that which United Bankshares has agreed to pay in the merger. If the merger is not completed, the ongoing business, financial condition and results of operations of each party may be materially adversely affected and the market price of each party’s common stock may decline significantly, particularly to the extent that the current market price reflects a market assumption that the merger will be completed. In addition, Community Bankers Trust’s or United Bankshares’ business may have been adversely impacted by the failure to pursue other beneficial opportunities due to the focus of management on the merger, without realizing any of the anticipated benefits of completing the merger. In addition, if the merger agreement is terminated under certain circumstances, including circumstances involving a change in recommendation by Community Bankers Trust’s board of directors, Community Bankers Trust may be required to pay United Bankshares a termination fee of $12,132,000. See “The Merger Agreement – Effect of Termination; Termination Fee” on page 75.

 

20


Table of Contents

Community Bankers Trust shareholders do not have dissenters’ appraisal rights in the merger.

Dissenters’ appraisal rights are statutory rights that, if applicable under law, enable shareholders to dissent from an extraordinary transaction, such as a merger, and to demand that the corporation pay the fair value for their shares as determined by a court in a judicial proceeding instead of receiving the consideration offered to shareholders in connection with the extraordinary transaction.

Under the Virginia Stock Corporation Act, shareholders are not entitled to relief as dissenting shareholders if the shares of the corporation for which the dissenting shareholder would otherwise be entitled to relief are covered securities under Section 18(b)(1)(A) or (B) of the Securities Act on the record date fixed to determine the shareholders entitled to receive notice of the meeting of shareholders to act upon the corporate action requiring appraisal rights.

Because Community Bankers Trust common stock is listed on Nasdaq, holders of Community Bankers Trust common stock will not be entitled to dissenters’ appraisal rights in the merger with respect to their shares of Community Bankers Trust common stock.

Failure to complete the merger could negatively affect the market price of Community Bankers Trust common stock.

If the merger is not completed for any reason, Community Bankers Trust will be subject to a number of material risks, including the following:

 

   

The market price of its common stock may decline to the extent that the current market prices of its shares reflect a market assumption that the merger will be completed;

 

   

Costs relating to the merger, such as legal, accounting and financial advisory fees, and, in specified circumstances, termination fees, must be paid even if the merger is not completed;

 

   

The diversion of management’s attention from the day-to-day business operations and the potential disruption to Community Bankers Trust’s employees and business relationships during the period before the completion of the merger may make it difficult to regain financial and market positions if the merger does not occur; and

 

   

If Community Bankers Trust’s board of directors seeks another merger or business combination, Community Bankers Trust shareholders cannot be certain that Community Bankers Trust will be able to find a party willing to pay an equivalent or greater consideration than that which United Bankshares has agreed to pay in the merger.

The shares of United Bankshares common stock to be received by Community Bankers Trust shareholders as a result of the merger will have different rights from the shares of Community Bankers Trust common stock.

Upon completion of the merger, Community Bankers Trust shareholders will become United Bankshares shareholders and their rights as shareholders will be governed by the United Bankshares articles of incorporation and the United Bankshares bylaws. The rights associated with Community Bankers Trust common stock are different from the rights associated with United Bankshares common stock. Please see “Comparative Rights of Shareholders” beginning on page 86 for a discussion of the different rights associated with United Bankshares common stock.

Community Bankers Trust will be subject to business uncertainties and contractual restrictions while the merger is pending.

Uncertainty about the effect of the merger on employees and customers may have an adverse effect on Community Bankers Trust. These uncertainties may impair Community Bankers Trust’s ability to attract, retain and motivate strategic personnel until the merger is consummated, and could cause customers and others that

 

21


Table of Contents

deal with Community Bankers Trust to seek to change existing business relationships with Community Bankers Trust. Experienced employees in the financial services industry are in high demand, and competition for their talents can be intense. Employees of Community Bankers Trust may experience uncertainty about their future role with the surviving entity until, or even after, strategies with regard to the combined company are announced or executed. If strategic Community Bankers Trust employees depart because of issues relating to the uncertainty and difficulty of integration or a desire not to remain with the surviving entity, Community Bankers Trust’s business following the merger could be harmed. In addition, the merger agreement restricts Community Bankers Trust from making certain acquisitions and taking other specified actions until the merger occurs without the consent of United Bankshares. These restrictions may prevent Community Bankers Trust from pursuing attractive business opportunities that may arise prior to the completion of the merger. See “The Merger Agreement – Conduct of Business Pending the Merger” on page 72.

If the merger does not constitute a reorganization under Section 368(a) of the Code, then each Community Bankers Trust shareholder may be responsible for payment of U.S. income taxes related to the exchange of Community Bankers Trust common stock for United Bankshares common stock.

The United States Internal Revenue Service, or the IRS, may determine that the merger does not qualify as a nontaxable reorganization under Section 368(a) of the Code. In that case, each Community Bankers Trust shareholder would recognize a gain or loss equal to the difference between the (i) the sum of the fair market value of United Bankshares common stock received by the Community Bankers Trust shareholder in the merger and (ii) the Community Bankers Trust shareholder’s adjusted tax basis in the shares of Community Bankers Trust common stock exchanged therefor.

Litigation against Community Bankers Trust or United Bankshares, or the members of the Community Bankers Trust board of directors or United Bankshares board of directors, could prevent or delay the completion of the merger.

Purported shareholder plaintiffs may assert legal claims related to the merger. The results of any such potential legal proceeding would be difficult to predict and such legal proceedings could delay or prevent the merger from being completed in a timely manner. The existence of litigation related to the merger could affect the likelihood of obtaining the required approval from Community Bankers Trust shareholders. Moreover, any litigation could be time consuming and expensive, and could divert the attention of the respective management teams of Community Bankers Trust and United Bankshares away from their companies’ regular business. Any lawsuit adversely resolved against Community Bankers Trust, United Bankshares or the members of the Community Bankers Trust board of directors or the United Bankshares board of directors could have a material adverse effect on each party’s business, financial condition and results of operations.

One of the conditions to the consummation of the merger is the absence of any statute, rule, regulation, judgment, decree, injunction or other order taken by the governmental authority of competent jurisdiction that prohibits the consummation of the transactions contemplated by the merger agreement, including the merger. Consequently, if a settlement or other resolution is not reached in any lawsuit that is filed or any regulatory proceeding and a claimant secures injunctive or other relief or a governmental authority issues an order or other directive restricting, prohibiting or making illegal the completion of the transactions contemplated by the merger agreement, including the merger, then such injunctive or other relief may prevent the merger from being completed in a timely manner or at all.

 

22


Table of Contents

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This document contains or incorporates by reference a number of “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including statements about the financial conditions, results of operations, earnings outlook and prospects of United Bankshares, Community Bankers Trust and the potential combined company and may include statements for the period following the completion of the merger. You can find many of these statements by looking for words such as “plan,” “believe,” “expect,” “intend,” “anticipate,” “estimate,” “project,” “potential,” “possible” or other similar expressions which identify these forward-looking statements and appear in a number of places in this prospectus and proxy statement (and the documents to which you are referred in this prospectus and proxy statement) and include, but are not limited to, all statements relating directly or indirectly to the timing or likelihood of completing the merger to which this prospectus and proxy statement relates, the timing and amount of growth and cost savings realized following the merger, plans for future growth and other business development activities as well as capital expenditures, financing sources and the effects of regulation and competition, potential effects of not approving proposals discussed in this prospectus and proxy statement or not completing the merger, and all other statements regarding the intent, plans, beliefs or expectations of United Bankshares, Community Bankers Trust, or those of their respective directors or officers.

The forward-looking statements involve certain risks and uncertainties. The ability of either United Bankshares or Community Bankers Trust to predict results or the actual effects of its plans and strategies, or those of the combined company, is subject to inherent uncertainty. Factors that may cause actual results or earnings to differ materially from such forward-looking statements include those set forth beginning on page 17 under “Risk Factors,” as well as, among others, the following:

 

   

Those discussed and identified in public filings with the SEC made by United Bankshares or Community Bankers Trust;

 

   

Fluctuations in the market price of United Bankshares common stock and the related effect on the market value of the merger consideration that Community Bankers Trust common shareholders will receive upon completion of the merger;

 

   

Business uncertainties and contractual restrictions while the merger is pending;

 

   

The possibility that the proposed merger does not close when expected or at all because required regulatory, shareholder or other approvals and conditions to closing are not received or satisfied on a timely basis or at all;

 

   

The terms of the proposed merger may need to be modified to satisfy such approvals or conditions;

 

   

The anticipated benefits from the proposed merger such as it being accretive to earnings and expanding United Bankshares’ geographic presence and synergies are not realized in the time frame anticipated or at all as a result of changes in general economic and market conditions, interest and exchange rates, monetary policy, laws and regulations (including changes to capital requirements) and their enforcement, and the degree of competition in the geographic and business areas in which the companies operate;

 

   

The ability to promptly and effectively integrate the businesses of United Bankshares and Community Bankers Trust;

 

   

Reputational risks and the reaction of the companies’ customers to the merger;

 

   

Diversion of management time on merger related issues;

 

   

Changes in asset quality and credit risk;

 

   

The inability to sustain revenue and earnings;

 

   

Changes in interest rates and capital markets;

 

23


Table of Contents
   

Inflation;

 

   

Customer acceptance of United Bankshares products and services;

 

   

Customer borrowing, repayment, investment and deposit practices;

 

   

Customer disintermediation;

 

   

The introduction, withdrawal, success and timing of business initiatives;

 

   

Competitive conditions;

 

   

The impact, extent and timing of technological changes;

 

   

Changes in fiscal and monetary policies, including changes in tax laws, and their effects on markets and customers; and

 

   

Changes in regulations and other actions of the Federal Reserve and federal and state banking regulators, and legislative and regulatory actions and reforms, including those associated with the Dodd-Frank Wall Street Reform and Consumer Protection Act and the federal regulations that make up the Volcker Rule, and the regulatory capital rules under Basel III.

Because these forward-looking statements are subject to assumptions and uncertainties, actual results may differ materially from those expressed or implied by these forward-looking statements. You are cautioned not to place undue reliance on these statements, which speak only as of the date of this document or the date of any document incorporated by reference in this document.

All subsequent written and oral forward-looking statements concerning the merger or other matters addressed in this document and attributable to United Bankshares or Community Bankers Trust or any person acting on their behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this document. Except to the extent required by applicable law or regulation, United Bankshares and Community Bankers Trust undertake no obligation to update these forward-looking statements to reflect events or circumstances after the date of this document or to reflect the occurrence of unanticipated events.

 

24


Table of Contents

EQUIVALENT PRO FORMA MARKET VALUE OF COMMON STOCK

United Bankshares common stock is traded on Nasdaq under the symbol “UBSI”. Community Bankers Trust common stock is traded on Nasdaq under the symbol “ESXB”. The closing sale price reported for United Bankshares common stock on June 2, 2021, the last trading date preceding the public announcement of the merger agreement, was $41.15 and the closing sale price reported for Community Bankers Trust common stock on such date was $9.20.

As of October 4, 2021, the last date prior to printing this prospectus and proxy statement for which it was practicable to obtain this information, there were approximately 8,708 registered holders of United Bankshares common stock and approximately 1,681 registered holders of Community Bankers Trust common stock.

The following table sets forth historical per share market values for United Bankshares common stock (i) on June 2, 2021, the last trading day prior to public announcement of the merger agreement, and (ii) on October 4, 2021, the most recent practicable date before the printing and mailing of this prospectus and proxy statement. The table also shows the equivalent pro forma market value of Community Bankers Trust common stock on those dates.

The equivalent pro forma market value of Community Bankers Trust common stock is obtained by multiplying the historical market price of United Bankshares common stock by the exchange ratio. Accordingly, the pro forma market value (i) on June 2, 2021 is determined by multiplying $41.15 by the exchange ratio of 0.3173 and (ii) on October 4, 2021 is determined by multiplying $36.89 by the exchange ratio of 0.3173.

The historical market prices represent the last sale prices on or before the dates indicated. The market price of United Bankshares common stock at the time of the merger may be higher or lower than the closing prices of United Bankshares common stock on the dates shown in the table and, therefore, the market value of the United Bankshares common stock that you receive may be higher or lower than the equivalent pro forma market value shown in the table.

Historical Market Price

 

     United
Bankshares
     Community Bankers
Trust
     Community Bankers
Trust
Equivalent Pro Forma
Market Value
 

June 2, 2021

   $ 41.15      $ 9.20      $ 13.06  

October 4, 2021

   $ 36.89      $ 11.48      $ 11.71  

Once the merger is completed, there will be no further private or public market for Community Bankers Trust common stock.

The market prices of both United Bankshares common stock and Community Bankers Trust common stock will fluctuate prior to the merger. Community Bankers Trust shareholders should obtain current stock price quotations for United Bankshares common stock.

COMPARATIVE HISTORICAL AND PRO FORMA UNAUDITED SHARE DATA

We have summarized below historical, unaudited per share information for United Bankshares and Community Bankers Trust and additional information as if the companies had been combined for the periods shown, which we refer to as “pro forma” information.

 

25


Table of Contents

The Community Bankers Trust pro forma equivalent per share amounts are calculated by multiplying the United Bankshares pro forma combined book value per share and net income per share by the exchange ratio of 0.3173 so that the per share amounts equate to the respective values for one share of Community Bankers Trust common stock.

We expect that both United Bankshares and Community Bankers Trust will incur merger and integration charges as a result of the merger. We also anticipate that the merger will provide the combined company with financial benefits that may include reduced operating expenses. The information set forth below, while helpful in illustrating the financial characteristics of the combined company under one set of assumptions, may not reflect all of these anticipated financial expenses and does not reflect all of these anticipated financial benefits or consider any potential impacts of current market conditions or the merger or revenues, expense efficiencies, asset dispositions, and share repurchases, among other factors, and, accordingly, does not attempt to predict or suggest future results. It also does not necessarily reflect what the historical results of the combined company would have been had our companies been combined during the periods presented.

In addition, the information set forth below has been prepared based on preliminary estimates of merger consideration and fair values attributable to the merger, the actual amounts recorded for the merger may differ from the information presented. The estimation and allocations of merger consideration are subject to change pending further review of the fair value of the assets acquired and liabilities assumed and actual transaction costs. A final determination of fair value will be based on the actual net tangible and intangible assets and liabilities of Community Bankers Trust that will exist on the date of completion of the merger.

The information in the following table is based on, and you should read it together with, the historical financial information and the notes thereto for United Bankshares and Community Bankers Trust incorporated by reference into, or contained in, this prospectus and proxy statement.

 

     Historical
United
Bankshares
     Historical
Community
Bankers Trust
     United
Bankshares
& Community
Bankers Trust
Proforma
Combined
    Proforma
Equivalent
Community
Bankers Trust
Share
 

Basic Earnings Per Common Share

          

For the year ended December 31, 2020

   $ 2.40      $ 0.70      $ 2.33 (1)    $ 0.74 (2) 

For the six months ended June 30, 2021

   $ 1.56      $ 0.54      $ 1.58 (1)    $ 0.50 (2) 

Diluted Earnings Per Common Share

          

For the year ended December 31, 2020

   $ 2.40      $ 0.69      $ 2.33 (1)    $ 0.74 (2) 

For the six months ended June 30, 2021

   $ 1.56      $ 0.53      $ 1.57 (1)    $ 0.50 (2) 

Cash Dividends Per Common Share

          

For the year ended December 31, 2020

   $ 1.40      $ 0.20      $ 1.40 (3)    $ 0.44 (2) 

For the six months ended June 30, 2021

   $ 0.70      $ 0.12      $ 0.70 (3)    $ 0.22 (2) 

Book Value Per Common Share

          

For the year ended December 31, 2020

   $ 33.37      $ 7.64      $ 33.41 (4)    $ 10.60 (2) 

For the six months ended June 30, 2021

   $ 34.01      $ 8.01      $ 34.10 (4)    $ 10.82 (2) 

 

26


Table of Contents
(1) 

Pro forma earnings per common share are based on pro forma combined net income and pro forma combined shares outstanding at the end of the period.

(2) 

Calculated based on pro forma combined multiplied by the exchange ratio.

(3) 

Pro forma dividends per share represent United Bankshares’ historical dividends per share.

(4) 

Calculated based on pro forma combined equity and pro forma combined common shares outstanding at the end of period.

 

27


Table of Contents

THE SPECIAL MEETING

This section contains information about the special meeting of Community Bankers Trust shareholders that has been called to consider and approve the merger agreement.

Together with this document, Community Bankers Trust is also sending you a notice of the special meeting and a form of proxy that is solicited by the Community Bankers Trust board of directors. The special meeting will be held on November 16, 2021, at 10:00 a.m., local time, at the Deep Run 3 Building, 9954 Mayland Drive, Richmond, Virginia 23233.

Matters to Be Considered

The purpose of the special meeting is to vote on:

 

  (1)

the Merger Proposal;

 

  (2)

the Merger-Related Compensation Proposal; and

 

  (3)

the Adjournment Proposal.

Proxies

Each copy of this document mailed to record holders of Community Bankers Trust common stock is accompanied by a proxy card with instructions for voting. The Community Bankers Trust board of directors requests that you submit your proxy promptly, whether or not you plan to attend the meeting. If you hold your shares of Community Bankers Trust common stock under your own name (also known as “record ownership”), you can vote your shares in one of the following manners:

 

   

By proxy via mail by signing and returning the enclosed proxy card in the postage-paid envelope;

 

   

By proxy via the Internet at www.cstproxyvote.com and following the instructions;

 

   

By proxy via telephone at (866) 894-0536 on a touch-tone phone and following the recorded instructions; or

 

   

By attending the meeting and voting your shares in person.

Any vote by proxy card, Internet or telephone may be revoked by you at any time before the meeting by giving written notice of such revocation to the corporate secretary, executing another proxy or using the Internet or telephone voting procedures as of a date subsequent to the prior proxy card or Internet or telephone vote. If you are a shareholder of record or have a legal proxy from a shareholder of record, you may also revoke your proxy by voting in person at the special meeting. Shareholders who vote via the Internet or by telephone need not mail their proxy cards and doing so will revoke any prior vote or proxy. Instructions on how to vote by telephone or by the Internet are included with your proxy card.

If you hold your shares in “street name” through a bank, broker, nominee or other holder of record, you will receive a voting instruction form directly from them. Follow the instructions on the form they provide to have your shares voted by proxy. If you wish to attend the meeting and vote in person, you must obtain a written proxy, executed in your favor, from the bank, broker, nominee or other holder of record to do so.

All shares represented by valid proxies that Community Bankers Trust receives through this solicitation and that are not revoked will be voted in accordance with your instructions on the proxy card or as instructed via the Internet or telephone, or with respect to shares beneficially held in “street name,” in accordance with the voting instructions received from the appropriate bank, broker, nominee or other holder of record. If you make no specification on your proxy card as to how you want your shares voted before signing and returning it, your proxy will be voted “FOR” each of the proposals described above.

 

28


Table of Contents

Community Bankers Trust shareholders with shares represented by stock certificates should not send Community Bankers Trust stock certificates with their proxy cards. After the merger is completed, holders of Community Bankers Trust common stock with shares represented by stock certificates or held in book-entry form will be mailed a transmittal form with instructions on how to exchange their Community Bankers Trust stock certificates or book-entry shares for the merger consideration.

Solicitation of Proxies

Community Bankers Trust will bear the entire cost of soliciting proxies from its shareholders. In addition to solicitation of proxies by mail, proxies may also be solicited by Community Bankers Trust’s directors and employees personally, and by telephone, electronic transmission, facsimile transmission, or other means. No additional compensation will be paid to these individuals for proxy solicitation nor is it expected to result in more than a minimal cost. Community Bankers Trust may make arrangements directly with banks, brokerage houses, custodians, nominees and fiduciaries to forward solicitation material to the beneficial owners of Community Bankers Trust common stock held of record by them and to obtain authorization for the execution of proxies. Community Bankers Trust expects to reimburse these institutional holders for their reasonable expenses in connection with these activities. Community Bankers Trust has also made arrangements with Morrow Sodali LLC to assist it in soliciting proxies and has agreed to pay it approximately $17,500 for these services and reimburse certain out of pocket expenses.

Record Date

The close of business on September 27, 2021 has been fixed as the record date for determining the Community Bankers Trust shareholders entitled to receive notice of and to vote at the special meeting. At that time, 22,464,593 shares of Community Bankers Trust common stock were outstanding and entitled to vote at the special meeting, held by approximately 1,681 holders of record.

Quorum and Voting Rights

The presence, in person or by proxy, of the holders of a majority of the outstanding shares of Community Bankers Trust common stock entitled to vote is necessary to constitute a quorum at the special meeting. Abstentions and shares of Community Bankers Trust common stock held of record by a broker or nominee that voted on any matter will be counted for the purpose of determining whether a quorum is present.

Under the rules that govern brokers who are voting with respect to shares held in street name, brokers or other nominees have the discretion to vote such shares on routine matters, but not on non-routine matters. In the case of non-routine items, the broker or other nominee holding street name shares cannot vote the shares if it has not received voting instructions. These are considered to be “broker non-votes.” Since there are no routine items to be voted on at the special meeting, brokers or nominees holding shares of Community Bankers Trust common stock that do not receive voting instructions from the beneficial owners of such shares will not be able to return a proxy card with respect to such shares. As a result, these shares will not be considered present at the special meeting and will not count towards the satisfaction of a quorum.

As of the record date, directors and executive officers of Community Bankers Trust had the sole right to vote 609,677 shares of Community Bankers Trust common stock, or approximately 2.71% of the outstanding Community Bankers Trust common stock entitled to be voted at the special meeting. Community Bankers Trust currently expects that each of these individuals will vote their shares of Community Bankers Trust common stock in favor of the proposals to be presented at the special meeting. Community Bankers Trust directors have entered into support agreements that obligated each director to vote shares of Community Bankers Trust common stock over which each such director has sole voting and dispositive power for approval of the Merger Proposal. As of the close of business on September 27, 2021, the record date for the special meeting, shares constituting 2.32% of Community Bankers Trust common stock were subject to the support agreements.

 

29


Table of Contents

If you are a holder of Community Bankers Trust common stock and you submit a proxy in which you abstain from voting, the abstention will be counted toward a quorum at the special meeting, and it will have the same effect as a vote against the Merger Proposal, the Merger-Related Compensation Proposal and the Adjournment Proposal.

Broker non-votes will have no effect for determining whether the Merger Proposal, the Merger-Related Compensation Proposal or the Adjournment Proposal have been approved.

Attending the Special Meeting

All holders of Community Bankers Trust common stock, including holders of record and shareholders who beneficially hold their stock through banks, brokers, nominees or any other holder of record, are invited to attend the special meeting. Shareholders of record on the record date can vote in person at the special meeting. If you beneficially hold your shares in “street name,” of record, you must obtain a written proxy executed in your favor from the record holder of your shares, such as a broker, bank or other nominee, to be able to vote in person at the special meeting. If you plan to attend the special meeting, you must either hold your shares in your own name or have a letter from the record holder of your shares confirming your ownership, and you must bring a form of personal photo identification with you in order to be admitted. Community Bankers Trust reserves the right to refuse admittance to anyone without proper proof of share ownership and without proper photo identification.

 

30


Table of Contents

PROPOSALS TO BE CONSIDERED AT THE SPECIAL MEETING

PROPOSAL NO. 1

APPROVAL OF THE MERGER AGREEMENT

Community Bankers Trust is asking its shareholders to approve the Merger Proposal. For a detailed discussion of the merger, including the terms and conditions of the merger agreement, see “The Merger Agreement,” beginning on page 63. As discussed in detail in the sections entitled “The Merger - Community Bankers Trust’s Reasons for the Merger; Recommendation of the Board of Directors,” beginning on page 38, after careful consideration, the Community Bankers Trust board of directors determined that the terms of the merger agreement and the transactions contemplated thereby are in the best interests of Community Bankers Trust and the Community Bankers Trust board of directors unanimously approved the merger agreement. Accordingly, Community Bankers Trust’s board of directors unanimously recommends that Community Bankers Trust shareholders vote “FOR” the Merger Proposal.

Required Vote

Approval of the Merger Proposal requires the affirmative vote of a majority of the shares represented in person or by proxy at the special meeting if a quorum is established. You are entitled to one vote for each share of Community Bankers Trust common stock you held as of the record date.

Because the affirmative vote of a majority of the shares represented in person or by proxy at the special meeting is needed in order to proceed with the merger, an abstention will have the effect of a vote against the merger agreement. The Community Bankers Trust board of directors urges Community Bankers Trust shareholders to promptly vote by completing, dating and signing the accompanying proxy card and returning it promptly in the enclosed postage-paid envelope, calling the toll-free number listed on the Community Bankers Trust proxy card, accessing the Internet site listed on the Community Bankers Trust proxy card, or, if you hold your stock in “street name” through a bank, broker, nominee or other holder of record, following the voting instructions of your bank, broker, nominee or other holder of record.

If you return a properly executed proxy card but do not indicate instructions on your proxy card, your shares of Community Bankers Trust Common Stock represented by such proxy card will be voted “FOR” approval of the Merger Proposal.

Recommendation of the Community Bankers Trust Board of Directors

The Community Bankers Trust board of directors unanimously recommends that Community Bankers Trust shareholders vote “FOR” approval of the Merger Proposal. See “The Merger - Community Bankers Trust’s Reasons for the Merger; Recommendation of the Community Bankers Trust Board of Directors” on page 38 for a more detailed discussion of the Community Bankers Trust board of directors’ recommendation.

PROPOSAL NO. 2

ADVISORY (NON-BINDING) VOTE ON CERTAIN MERGER-RELATED

COMPENSATION FOR COMMUNITY BANKERS TRUST NAMED EXECUTIVE OFFICERS

As required by Section 14A of the Securities Exchange Act of 1934, as amended, or the Exchange Act, Community Bankers Trust is providing its shareholders with the opportunity to approve, in a non-binding advisory vote, certain compensation that may become payable to its named executive officers in connection with

 

31


Table of Contents

the merger, which is based on or related to the merger and the agreements and understandings concerning such compensation, by voting on the following resolution:

“RESOLVED, that the compensation that may be paid to the named executive officers of Community Bankers Trust in connection with or as a result of the merger, as disclosed in the section entitled “The Merger – Interests of Certain Community Bankers Trust Directors and Executive Officers in the Merger – Certain Compensation for Community Bankers Trust Named Executive Officers,” and the related table and narrative, is hereby APPROVED.”

Approval of the Merger-Related Compensation Proposal is not a condition to completion of the merger. The vote on this proposal is a vote separate and apart from the vote on the Merger Proposal. Because this proposal is advisory in nature only, a vote for or against approval will not be binding on either Community Bankers Trust or United Bankshares.

The compensation that is subject to this proposal is a contractual obligation of Community Bankers Trust and/or Essex Bank and of United Bankshares and United Bank as the successors thereto. Such compensation may be paid in connection with the merger, subject only to the conditions applicable thereto, even if shareholders fail to approve this proposal. If the merger is not completed, the Community Bankers Trust board of directors will consider the results of the vote in making future executive compensation decisions.

Required Vote

Approval of the Merger-Related Compensation Proposal requires the affirmative vote of a majority of the shares represented in person or by proxy at the special meeting if a quorum is established. Abstentions will be counted toward a quorum at the special meeting, but will have the effect as a vote against this proposal.

If you return a properly executed proxy card but do not indicate instructions on your proxy card, your shares of Community Bankers Trust common stock represented by such proxy card will be voted “FOR” approval of the Merger-Related Compensation Proposal.

Recommendation of the Community Bankers Trust Board of Directors

The Community Bankers Trust board of directors unanimously recommends that Community Bankers Trust shareholders vote “FOR” approval of the Merger-Related Compensation Proposal.

PROPOSAL NO. 3

APPROVAL OF THE ADJOURNMENT, POSTPONEMENT OR CONTINUANCE OF THE SPECIAL MEETING, IF NECESSARY, TO PERMIT FURTHER SOLICITATION OF PROXIES

If at the special meeting the number of shares of Community Bankers Trust common stock present in person or represented by proxy and voting in favor of the Merger Proposal is insufficient to approve such proposal, management may move to adjourn, postpone or continue the special meeting on one or more occasions in order to enable Community Bankers Trust to continue to solicit additional proxies in favor of such proposal; however, the special meeting may not be adjourned, postponed or continued to a date later than March 16, 2022. In that event, you will be asked to vote only upon the Adjournment Proposal, may be asked to vote on the Merger-Related Compensation Proposal and will not be asked to vote on the Merger Proposal at the special meeting.

In this proposal, Community Bankers Trust is asking the Community Bankers Trust shareholders to authorize the holder of any proxy solicited by its board of directors to grant to the Community Bankers Trust board of directors the authority to adjourn, postpone or continue the special meeting and any later adjournments.

 

32


Table of Contents

If the Community Bankers Trust shareholders approve this proposal, Community Bankers Trust could adjourn, postpone or continue the special meeting, and any adjourned session of the special meeting on one or more occasions, to use the additional time to solicit proxies in favor of the Merger Proposal, including the solicitation of proxies from the shareholders that have previously voted against such proposal. Among other effects, approval of the Adjournment Proposal could mean that, even if proxies representing a sufficient number of votes against the approval of the Merger Proposal have been received, Community Bankers Trust could adjourn, postpone or continue the special meeting without a further shareholder vote on such proposal and seek to convince the holders of those shares to change their votes to vote in favor of such proposal.

Generally, if the special meeting is adjourned, no notice of the adjourned meeting is required to be given to shareholders, other than an announcement at the special meeting of the place, date and time to which the meeting is adjourned.

Required Vote

Approval of the Adjournment Proposal requires the affirmative vote of a majority of the shares represented in person or by proxy at the special meeting if a quorum is established. Abstentions will be counted toward a quorum at the special meeting, but will have the effect as a vote against this proposal.

If you return a properly executed proxy card but do not indicate instructions on your proxy card, your shares of Community Bankers Trust Common Stock represented by such proxy card will be voted “FOR” approval of the Adjournment Proposal.

Recommendation of the Community Bankers Trust Board of Directors

The Community Bankers Trust board of directors believes that if the number of shares of its common stock present in person or represented by proxy at the special meeting and voting in favor of the approval of the Merger Proposal is insufficient to approve such proposal, it is in the best interests of the Community Bankers Trust shareholders to enable the board of directors, for a limited period of time, to continue to seek to obtain a sufficient number of additional votes to approve such proposal. The Community Bankers Trust board of directors unanimously recommends that shareholders vote “FOR” the approval of the Adjournment Proposal.

THE MERGER

The following summary describes certain aspects of the merger. This summary does not purport to be complete and may not contain all of the information about the merger that is important to you. Holders of Community Bankers Trust common stock should read carefully this prospectus and proxy statement in its entirety, including appendices, for more detailed information concerning the merger and the merger agreement. In particular, you are directed to the merger agreement, including the exhibits thereto, copies of which are attached as Appendix A and are incorporated in this prospectus and proxy statement by reference.

Background of the Merger

The board of directors and management of Community Bankers Trust has considered and discussed many strategic opportunities over the years. These opportunities have included business combinations, operational enhancements, and improvements related to Community Bankers Trust’s use of capital through, for example, dividends and repurchases of common stock, all with a view to increase long-term value for its shareholders.

The types of business combinations considered have included acquiring smaller financial institutions or other companies that offer ancillary banking products and services, entering into mergers of equals with other financial institutions, or being acquired by a larger financial institution. The Community Bankers Trust board’s

 

33


Table of Contents

discussions have occurred generally through annual strategic retreats and more frequently when opportunities arise at its monthly meetings and through special meetings of its Strategic Planning Committee. The Community Bankers Trust board created the Strategic Planning Committee in 2014 to assist it with the fulfillment of its oversight responsibilities with respect to the analysis, discussion and review of key strategic decisions at times outside of the board’s annual strategic retreat. The members of the Strategic Planning Committee during consideration of the proposed merger with United were four independent directors, Gerald F. Barber, Hugh M. Fain, III, Eugene S. Putnam, Jr. and John C. Watkins, and Rex L. Smith, III, Community Bankers Trust’s president and chief executive officer. Ira C. Harris joined the Strategic Planning Committee effective upon the retirement of Mr. Watkins from the board on May 21, 2021.

At all of these strategic and other meetings, Mr. Smith communicates all contacts that he has made with or received from other companies, financial advisors and other interested parties. The strategic retreats have included representatives of various advisors in the financial institution industry with which Community Bankers Trust has had relationships, and the presentations and discussions have included both projected deal prices that Community Bankers Trust could pay and various target financial institutions might accept, and projected deal prices that larger financial institutions could pay for Community Bankers Trust. Community Bankers Trust has pursued acquisitions of other financial institutions, but has not been successful in offering attractive enough price and deal terms, through either mutually negotiated or auction-run processes, to acquire another financial institution, and no other financial institution had previously offered an attractive enough price and deal terms to Community Bankers Trust that was at a level that matched or exceeded what the Community Bankers Trust board believed would be in the best interests of shareholders.

In late 2019, the chief executive officer of an out-of-state and larger financial institution, which we refer to as Company A, contacted Mr. Smith to see it there was interest in discussing a possible merger between Community Bankers Trust and Company A. Discussions between these individuals continued and remained preliminary into 2020. As these discussions progressed, the Community Bankers Trust board determined that it was in the best interests of Community Bankers Trust to formally engage a financial advisor in order to pursue more aggressively various business combination opportunities. In February 2020, the Community Bankers Trust board met with representatives from each of Piper Sandler & Co. and one other financial advisor, both nationally known and experienced investment banking firms focused on financial institutions, and approved the engagement with Piper Sandler.

Due to the impact of the COVID-19 pandemic increasing significantly in March 2020, Mr. Smith and the chief executive officer of Company A suspended their discussions. In addition, Community Bankers Trust and Piper Sandler similarly delayed their formal engagement, but Mr. Smith and representatives of Piper Sandler maintained regular discussions throughout the ensuing months with respect to business combination opportunities that were and could be available to Community Bankers Trust, whether an acquisition, a merger of equals or a sale of Community Bankers Trust.

In early March 2021, the chief executive officer of Company A reached back out to Mr. Smith to resume discussions about a potential business combination, and they met in person. At the same time, Company A’s financial advisor provided Piper Sandler with a range of pricing of $11.00 to $12.00 for each share of Community Bankers Trust’s common stock with 100% stock consideration for such a combination. The Community Bankers Trust board’s Strategic Planning Committee met on March 19, 2021 to review Company A’s renewed interest and determine next steps. The Committee received a presentation from the representatives of Piper Sandler that included a comparison of projected purchase prices and other analysis with respect to a number of potential acquirers, including Company A, the financial metrics for an illustrative offer price range and key assumptions for a merger with Company A and the variable factors that could affect the actual value that other potential acquirers could offer. The Committee asked Piper Sandler to engage in an informal market check to determine the value of Community Bankers Trust in order for the Committee to adequately consider the range of pricing generally. On March 31, 2021, Community Bankers Trust and Piper Sander signed a formal engagement letter.

 

34


Table of Contents

During the weeks of April 5 and April 12, 2021, Piper Sandler engaged in its market check exercise and contacted four larger financial institutions (which included Company A and United Bankshares) that were most likely to be interested in a transaction involving Community Bankers Trust in the current market environment, that would be in a position to pay a price at or higher than what Community Bankers Trust’s board believed it could reasonably achieve as a stand-alone company and that had been identified in past strategic meetings as desirable acquirers for Community Bankers Trust. The two financial institutions other than United Bankshares and Company A ultimately declined to submit indications of interest in the market check due to timing considerations. Mr. Smith provided a status report of the market check to the Community Bankers Trust board at its monthly meeting on April 16, 2021.

On April 19, 2021, Mr. Smith met in person with the chief executive officer of Company A to discuss further the two companies’ interest in a business combination and next steps. On April 20, 2021, Mr. Smith met in person with Richard M. Adams, Jr., United Bankshares’ president, and James J. Consagra, Jr., United Bankshares’ executive vice president and chief operating officer, to discuss the two companies and the potential for a future partnership as a follow-up to the market check inquiry that United Bankshares had received.

On April 22, 2021, the chief executive officer of Company A sent Mr. Smith a short informal indication of interest proposing a price of $12.00 per share for Community Bankers Trust’s common stock and a request for a 60-day exclusivity agreement. The Strategic Planning Committee met on April 23, 2021 to discuss the current status of the market check and to review preliminarily Company A’s indication of interest. The Committee did not set any immediate next steps at that meeting.

On April 30, 2021, United Bankshares sent Community Bankers Trust, through Piper Sandler, a formal indication of interest, including implied pricing of $12.50 per share for Community Bankers Trust’s common stock in an all-stock transaction and specific key terms for a transaction. The indication of interest proposed that the definitive merger agreement would include a fixed exchange ratio to be determined based upon a trailing 10-trading day volume-weighted average price for shares of United Bankshares’ common stock on the last trading day prior to the date of a merger announcement. The terms also proposed that Mr. Smith would serve as a regional president for the combined company. United Bankshares’ indication of interest did not impose any exclusivity requirement on Community Bankers Trust.

On May 3, 2021, the Strategic Planning Committee met to review and discuss both indications of interest and their strengths and weaknesses and to prepare for a meeting with representatives of Piper Sandler. On each of May 4, 2021 and May 5, 2021, the Committee met with representatives of Piper Sandler to review and discuss further the two indications of interest and next steps. The representatives of Piper Sandler summarized the market check process, and the Committee discussed the various options for Community Bankers Trust, including instructing Piper Sandler to solicit interest from additional financial institutions, responding to both potential acquirers and declining interest in moving forward with a transaction, responding to both potential acquirers and asking for due diligence, and responding to both potential acquirers and requesting better offers. The representatives of Piper Sandler presented and reviewed an analysis of the preliminary indications of interest, including a preliminary comparison of the financial metrics of the potential business combinations. They explained certain terms that the United Bankshares offer included, and they noted that both indications of interests compared generally favorably to merger and acquisition transactions involving financial institutions that had been announced since the beginning of 2021. The Committee discussed various matters, including the strength of the exchange ratios when comparing cost savings versus earnings streams and the timing of a transaction in light of the current outlook for markets and the financial industry. The representatives of Piper Sandler also reviewed a stock sensitivity analysis for the past four months and projections for a transaction with each potential acquirer. They also reviewed an overview of a combined company for each interested potential acquirer, including market maps, and a net present value analysis of Community Bankers Trust. The Committee discussed Community Bankers Trust’s value, how much a buyer could pay, and the strengths and weaknesses of each potential acquirer. The Committee asked Piper Sandler to go back and ask each potential acquirer for its best offer on both price and other terms. Piper Sandler subsequently reached out to each of United Bankshares and Company A.

 

35


Table of Contents

On May 10, 2021, United Bankshares sent Community Bankers Trust, through Piper Sandler, an updated formal indication of interest that reflected updated implied pricing of $13.00 per share for Community Bankers Trust’s common stock and the other unchanged key terms for a transaction. After being contacted by Piper Sandler, Company A did not update its indication of interest with implied pricing of $12.00 per share and requested that Mr. Smith reach back out if Community Bankers Trust remained interested in a transaction. No further discussions between Company A and Community Bankers Trust occurred.

On May 13, 2021, the Strategic Planning Committee met with management and the representatives of Piper Sandler to review the strengths and weaknesses of each potential acquirer and potential timing of next steps. The representatives of Piper Sander reviewed an updated analysis of the preliminary indications of interest and a preliminary comparison of the financial metrics of the potential business combinations, including updates to the United Bankshares offer based on the increased pricing. They also reviewed a new comparison of key financial metrics with respect to each potential acquirer and a new summary of historical earnings and balance sheet growth for each potential acquirer. The Committee discussed various matters, including projected growth rates for Community Bankers Trust based on organic growth as compared to inorganic growth, the status of other acquisition opportunities for Community Bankers Trust, the type of community bank that each potential acquirer is, the deal term with respect to Mr. Smith serving as a regional president of the combined company, timing of due diligence and total shareholder return. The Committee determined to recommend to the Community Bankers Trust board moving forward with United Bankshares in light of the proposed terms of its indication of interest and other corporate strengths.

On May 14, 2021, the Community Bankers Trust board held a special meeting to discuss in depth the two indications of interest. Management and the representatives from Piper Sandler reviewed with the Community Bankers Trust board the developments that had taken place to date. The representatives from Piper Sandler presented an analysis and review of the indications of interest. They reviewed a net present value analysis of Community Bankers Trust, and the Community Bankers Trust board noted the meaningful change needed internally in order to reach the value that has been offered for Community Bankers Trust. The Community Bankers Trust board also discussed the multiples and the peer groups used in the analysis and the financial metrics of merger and acquisition transactions that have been announced since the onset of the pandemic. The representatives of Piper Sandler reviewed each metric from these transactions, as compared to the offer from United Bankshares, and they noted that every transaction has different dynamics. The Community Bankers Trust board discussed the advantages and disadvantages of Community Bankers Trust staying independent. The Community Bankers Trust board discussed a comparison of a value stock compared to a growth stock for the potential acquirers, expected future loan and operational strategies, the nature of the challenge for Community Bankers Trust to grow organically, certain intangibles of a community bank and the impact of a merger generally and on stock price, a comparison of the potential acquirers, future merger and acquisition opportunities for Community Bankers Trust and the timing of a transaction in light of Community Bankers Trust’s future potential. Management discussed its view of the operational and other strategies and their related challenges and key strategies for moving forward, including holding net interest margin and continuing growth. The Community Bankers Trust board discussed a number of matters, including Community Bankers Trust’s efforts to acquire in strategic markets and related difficulties in doing so, Community Bankers Trust’s creation of good value to date combined with the current presence of interested buyers, the fit of Community Bankers Trust and each potential acquirer culturally and geographically, the difficulty in obtaining the needed level of growth organically, the potential acquirers’ investment in the community and the ability of Community Bankers Trust to keep up with an ever-changing delivery platform in the banking industry. The Community Bankers Trust board approved moving forward with a potential all-stock merger transaction with United Bankshares with an implied value of $13.00 per share, subject to continued due diligence by both parties, negotiation of a definitive merger agreement, and agreement between Mr. Smith and United Bankshares regarding his employment with the combined company.

On May 17, 2021, United Bankshares delivered an initial due diligence review list to Community Bankers Trust. During the period through June 2, 2021, representatives of United Bankshares and Community Bankers Trust, with the assistance of their respective financial and legal advisors, communicated by phone to review

 

36


Table of Contents

business, financial and other information regarding each company. During these meetings, members of management of each of the companies, with the assistance of their advisors, engaged in a series of discussions and asked and answered questions regarding each company’s respective businesses.

On May 18, 2021, United Bankshares delivered a draft of a proposed definitive agreement containing the proposed complete terms of the transaction. During the period through June 2, 2021, the parties and their legal counsel exchanged drafts and negotiated changes to the draft merger agreement to resolve all open issues and to reach a final definitive agreement. During this time, management of the parties and their respective financial advisors also provided drafts of their respective disclosure schedules to the merger agreement and discussed other aspects of the proposed transaction and merger integration issues. United Bankshares also negotiated the terms of the employment agreement to be entered into between United Bankshares and Mr. Smith, to be effective upon the consummation of the proposed merger.

On May 27, 2021, the Community Bankers Trust board held a special meeting to discuss the current status of the transaction and received preliminary reports from management, Piper Sandler and Williams Mullen, Community Bankers Trust’s outside legal counsel. Management discussed the current status of United Bankshares’ due diligence of the Community Bankers Trust and Community Bankers Trust’s reverse due diligence of United Bankshares. The Community Bankers Trust board asked for additional information about United Bankshares as part of that process. Management discussed the current negotiations and the status of the proposed merger agreement, the current structure of the exchange ratio for the all-stock deal, the terms of Mr. Smith’s employment arrangement with the combined company and the preparation of disclosure schedules that provided additional agreements and information with respect to compensation and other employee-related matters. The Community Bankers Trust board discussed the merger agreement and asked for additional negotiation of certain key terms. Management and the Community Bankers Trust board discussed timing and next steps, which would include the completion and resolution of due diligence and the merger agreement and formal approval from the Community Bankers Trust board.

The United Bankshares board of directors approved the merger early in the afternoon of June 2, 2021.

On the afternoon of June 2, 2021, the Community Bankers Trust board held a special meeting to consider the terms of the proposed merger with United Bankshares. At the meeting, representatives of Piper Sandler reviewed and discussed with the Community Bankers Trust board its financial analyses of Community Bankers Trust, United Bankshares and the proposed merger. This analysis included the fixed exchange ratio of 0.3173. Piper Sandler rendered its oral opinion to the Community Bankers Trust board, which was subsequently confirmed in writing by delivery of Piper Sandler’s written opinion dated June 2, 2021, to the effect that, as of June 2, 2021 and subject to the procedures followed, assumptions made, matters considered and qualifications and limitations on the review undertaken by Piper Sandler, the exchange ratio in the proposed merger was fair, from a financial point of view, to the holders of Community Bankers Trust’s common stock.

Representatives of Williams Mullen also were present at the meeting and discussed with the Community Bankers Trust board the legal standards applicable to its decisions and actions with respect to its consideration of the proposed merger. They reviewed in detail the proposed merger agreement and related transaction documents, copies of which were delivered to each director in advance of the meeting. Following extensive review, discussion and consideration of the presentations from Piper Sandler and Williams Mullen, and after considering the proposed terms of the merger agreement and other transaction documents, the Community Bankers Trust board unanimously voted to approve the merger, approve and adopt the merger agreement and directed Mr. Smith to finalize and execute a definitive merger agreement on the terms presented at the meeting.

United Bankshares and Community Bankers Trust executed the merger agreement the evening of June 2, 2021 and publicly announced the transaction on June 3, 2021 in a press release that United Bankshares and Community Bankers Trust jointly issued.

 

37


Table of Contents

Community Bankers Trust’s Reasons for the Merger; Recommendation of the Community Bankers Trust Board of Directors

After careful consideration, Community Bankers Trust’s board of directors, at a meeting held on June 2, 2021, unanimously determined that the merger agreement and the transactions contemplated thereby to be fair and in the best interest of Community Bankers Trust and its shareholders. Accordingly, Community Bankers Trust’s board of directors adopted and approved the merger agreement and unanimously recommends that Community Bankers Trust’s shareholders vote “FOR” the approval of the merger agreement.

In evaluating the merger agreement and reaching its decision to adopt and approve the merger agreement and recommend that Community Bankers Trust’s shareholders approve the merger agreement, Community Bankers Trust’s board consulted with Community Bankers Trust’s management, as well as its outside legal and financial advisors, and considered a number of factors, including the following material factors (not in any relative order of importance):

 

   

the board’s knowledge and understanding of Community Bankers Trust’s business, operations, financial condition, asset quality, earnings and prospects, and of United Bankshares’ business, operations, financial condition, asset quality, earnings and prospects, taking into account the information shared by United Bankshares’ officers and information and analysis provided by Community Bankers Trust’s financial advisors;

 

   

the board’s understanding of United Bankshares’ commitment to enhancing its strategic position in Community Bankers Trust’s market area, its prospects for the future and its projected financial results, and the Community Bankers Trust board’s belief that the combined enterprise would benefit from United Bankshares’ ability to take advantage of economies of scale and grow in the current economic environment;

 

   

Community Bankers Trust’s earnings track record and the market performance of its common stock;

 

   

the ability of Community Bankers Trust’s shareholders to benefit from United Bankshares’ potential long-term stock value since it is more likely that the combined entity will have superior future earnings and prospects compared to Community Bankers Trust’s earnings and prospects on an independent basis due to greater operating efficiencies and better penetration of commercial and consumer markets;

 

   

the perceived ability of United Bankshares to complete a merger transaction from a financial and regulatory perspective, including its prior history of successful merger transactions;

 

   

the financial and other terms of the merger agreement, including the amount and nature of the consideration proposed to be paid, which Community Bankers Trust’s board reviewed with its outside financial and legal advisors, including:

 

     

Community Bankers Trust’s ability, under certain circumstances specified in and prior to the time Community Bankers Trust’s shareholders approve the merger agreement (i) to provide non-public information in response to a written acquisition proposal from a third party and (ii) participate in discussions or negotiations with a third party making such proposal, if (A) the board concludes in good faith, after consultation with and based upon the advice of outside legal counsel, that the failure to take such actions would be reasonably likely to constitute a breach of its fiduciary duties to its shareholders under applicable law, (B) before taking such actions, Community Bankers Trust receives an executed confidentiality agreement providing for reasonable protection of confidential information, and (C) the board concludes in good faith, after consultation with its outside legal counsel and financial advisors, that the acquisition proposal constitutes or is reasonably likely to result in a superior proposal;

 

     

the fact that the outside date for completing the merger under the merger agreement allows for sufficient time to complete the merger;

 

38


Table of Contents
     

the board’s understanding that the proposed merger with United Bankshares will generally be a tax-free transaction to Community Bankers Trust’s shareholders with respect to United Bankshares common stock received by virtue of the merger;

 

     

the level of effort that United Bankshares must use under the merger agreement to obtain required regulatory approvals, and the prospects for such approvals being obtained in a timely fashion and without the imposition of any adverse conditions;

 

   

the board’s review of the potential costs associated with executing the merger agreement, including change in control, severance and related costs, as well as estimated advisor fees, which the board concluded were reasonable and would not affect the advice from, or the work performed by senior management of Community Bankers Trust or Community Bankers Trust’s financial advisor in connection with the evaluation of the merger and the merger agreement by Community Bankers Trust’s board;

 

   

the complementary aspects of the Community Bankers Trust and United Bankshares businesses, including customer focus, geographic coverage, business orientation and compatibility of the companies’ management operating styles;

 

   

the potential expense-saving and revenue-enhancing opportunities in connection with the merger, the related potential impact on the combined company’s earnings and the fact that the stock form of merger consideration would allow former Community Bankers Trust shareholders to participate in the potential future stock price value and higher dividends as United Bankshares shareholders;

 

   

the anticipated effect of the acquisition on Community Bankers Trust’s retained employees and the terms of severance for employees who would not be retained;

 

   

the long-term and short-term interests of Community Bankers Trust and its shareholders, and the interests of Community Bankers Trust’s employees, customers, creditors and suppliers, and the community and societal considerations of the communities in which Community Bankers Trust maintains offices;

 

   

the financial analyses provided by Piper Sandler, Community Bankers Trust’s financial advisor, regarding the merger, and its opinion, delivered to Community Bankers Trust’s board on June 2, 2021, to the effect that, as of that date, the exchange ratio under the terms of the merger agreement was fair, from a financial point of view, to holders of Community Bankers Trust common stock;

 

   

the board’s knowledge of the current environment in the financial services industry, including national, regional and local economic conditions, continued industry consolidation, increased regulatory burdens, evolving trends in technology and increasing nationwide and global competition, the current financial market conditions, the current environment for community banks, particularly in Virginia and Maryland, and the likely effects of these factors on Community Bankers Trust’s and the combined company’s potential growth, development, productivity, profitability and strategic options, and the historical prices of Community Bankers Trust and United Bankshares common shares;

 

   

the board’s knowledge of Community Bankers Trust’s prospects as an independent entity, including challenges relating to increasing regulatory burdens and both the costs associated with them and their impact on Community Bankers Trust’s financial results, increasing overhead expenses, such as technology costs to mitigate cyber security threats, vulnerabilities and evolving threats to physical and information security in the financial services industry, the increasing need to create additional efficiencies in the current and prolonged interest rate environment, and business continuity issues surrounding the current and possible other pandemic events;

 

   

the board’s knowledge of the strategic alternatives available to Community Bankers Trust, including the challenges for organic growth by a financial institution of Community Bankers Trust’s size; and

 

   

the board’s belief that the merger is more favorable to Community Bankers Trust’s shareholders than the alternatives to the merger, which belief was formed based on the careful review undertaken by

 

39


Table of Contents
 

Community Bankers Trust’s board of directors, with the assistance of its management and outside legal and financial advisors.

Community Bankers Trust’s board also considered potential risks and a variety of potential negative factors in connection with its deliberations concerning the merger agreement and the merger, including the following material factors (not in any relative order of importance):

 

   

the fact that, while Community Bankers Trust expects that the merger will be consummated, there can be no assurance that all conditions to the parties’ obligations to complete the merger agreement will be satisfied, including the risk that certain regulatory approvals, the receipt of which are conditions to the consummation of the merger, might not be obtained, and, as a result, the merger may not be consummated;

 

   

the restrictions on the conduct of Community Bankers Trust’s business prior to the completion of the merger, which are customary for public company merger agreements involving financial institutions, but which, subject to specific exceptions, could delay or prevent Community Bankers Trust from undertaking business opportunities that may arise or any other action it would otherwise take with respect to the operations of Community Bankers Trust absent the pending completion of the merger;

 

   

the significant risks and costs involved in connection with entering into or completing the merger, or failing to complete the merger in a timely manner, or at all, including as a result of any failure to obtain required regulatory approvals or approval of Community Bankers Trust shareholders, such as the risks and costs relating to diversion of management and employee attention from other strategic opportunities and operational matters, potential employee attrition, and the potential effect on business and customer relationships;

 

   

fluctuations in the trading price of United Bankshares common stock that, because the exchange ratio is fixed, will change the value of the shares of United Bankshares common stock that Community Bankers Trust shareholders receive in the merger;

 

   

the fact that Community Bankers Trust would be prohibited from soliciting acquisition proposals after execution of the merger agreement, and the possibility that the $12,132,000 termination fee payable by Community Bankers Trust upon the termination of the merger agreement under certain circumstances could discourage other potential acquirers from making a competing bid to acquire Community Bankers Trust;

 

   

the fact that some of Community Bankers Trust’s directors and executive officers have other interests in the merger that are different from, or in addition to, their interests as Community Bankers Trust shareholders; and

 

   

the possibility of litigation in connection with the merger.

Based on the factors described above, the board of Community Bankers Trust determined that the merger with United Bankshares and the merger of Essex Bank with United Bank would be advisable and in the best interests of Community Bankers Trust and adopted the merger agreement and resolved to recommend its approval to the shareholders of Community Bankers Trust.

The foregoing discussion of the information and factors considered by the Community Bankers Trust board of directors is not intended to be exhaustive but includes the material factors considered by the Community Bankers Trust board of directors. In view of the wide variety of factors considered in connection with its evaluation of the merger and the complexity of these matters, the Community Bankers Trust board of directors did not find it useful, and did not attempt, to quantify, rank or otherwise assign relative weights to these factors. In considering the factors described above, the individual members of the Community Bankers Trust board of directors may have given different weight to different factors. The Community Bankers Trust board of directors conducted an overall analysis of the factors described above including through discussions with, and questioning

 

40


Table of Contents

of, Community Bankers Trust’s management and Community Bankers Trust’s legal and financial advisors, and considered the factors overall to be favorable to, and to support, its determination to adopt the merger agreement and recommend its approval to Community Bankers Trust’s shareholders.

United Bankshares’ Reasons for the Merger

The United Bankshares board of directors considers the strategic direction of United Bankshares, including an evaluation of strategic growth opportunities, on a regular basis. This consideration includes periodic discussions with United Bankshares management with respect to business combination opportunities. In its evaluation of potential acquisition targets, the United Bankshares board of directors considers numerous factors, including among other things the strength of the fit between the target and United Bankshares’ existing business, the accretive or dilutive impact of the acquisition on United Bankshares’ earnings per share and other measures of profitability, the projected strength of the combined enterprise, the expected pro forma effects of the transaction on the balance sheet of the combined enterprise, and the impacts of the transaction on United Bankshares shareholders, employees, customers and other stakeholders.

In reaching its decision to adopt and approve the merger agreement, the merger, the issuance of United Bankshares common stock in connection with the merger and the other transactions contemplated by the merger agreement, the United Bankshares board of directors evaluated the merger agreement, the merger, the issuance of United Bankshares common stock and the other transactions in consultation with United Bankshares management, as well as United Bankshares’ financial and legal advisors, and considered a number of factors, including the following material factors:

 

   

United Bankshares’, Community Bankers Trust’s and the combined entity’s business, operations, financial condition, risk profile, asset quality, earnings and prospects. In reviewing these factors, the United Bankshares board of directors considered its view that Community Bankers Trust’s business and operations complement those of United Bankshares and that the merger would result in a combined company with a more diversified revenue stream and an attractive funding base;

 

   

The combined entity will be the leading independent community bank operating throughout the most attractive markets in Virginia and Washington, D.C.;

 

   

Community Bankers Trust’s familiarity with the Virginia and Maryland markets;

 

   

The board’s understanding of the current and prospective environment in which United Bankshares and Community Bankers Trust operate, including national and local economic conditions, the competitive environment for financial institutions generally and the likely effect of these factors on United Bankshares both with and without the proposed transaction;

 

   

Management’s expectation regarding cost synergies, accretion, tangible book value dilution and internal rate of return;

 

   

Its review and discussions with United Bankshares management concerning the due diligence examination of Community Bankers Trust;

 

   

Sensitivity of the proposed transaction’s economic returns to a variety of factors, including changes to the amount of cost synergies, Community Bankers Trust’s pro forma earnings, Community Bankers Trust’s rates of growth and estimated mark-to-market of the associated loan portfolio;

 

   

The market for alternative merger or acquisition transactions in the banking industry and the likelihood and timing of other material strategic transactions;

 

   

The complementary nature of the cultures and product mix of the two companies that management believes should facilitate integration and implementation of the transaction;

 

   

Management’s expectation that the strong capital position maintained by each separate company prior to the completion of the merger will contribute to a strong capital position for the combined entity upon completion of the merger;

 

41


Table of Contents
   

The opinion, dated June 2, 2021, of Performance Trust to the United Bankshares board of directors as to the fairness, from a financial point of view and as of the date of the opinion, to United Bankshares of the exchange ratio in the proposed merger;

 

   

The terms of the merger agreement, including the fixed exchange ratio, tax treatment and mutual deal protection and termination fee provisions, which it reviewed with its outside legal and financial advisors;

 

   

The potential risks associated with and management’s recent experience in achieving anticipated cost synergies and savings and successfully integrating Community Bankers Trust’s business, operations and workforce with those of Community Bankers Trust;

 

   

The nature and amount of payments to be received by Community Bankers Trust management in connection with the merger and the merger-related costs and restructuring charges that will be incurred in connection with the merger;

 

   

The potential risk of diverting management attention and resources from the operation of United Bankshares’ business and towards the completion of the merger; and

 

   

The regulatory and other approvals required in connection with the merger.

The foregoing discussion of the information and factors considered by the United Bankshares board of directors is not intended to be exhaustive, but includes the material factors considered by the United Bankshares board of directors. In reaching its decision to approve the merger agreement, the merger, the issuance of United Bankshares common stock to Community Bankers Trust shareholders in connection with the merger, and the other transactions contemplated by the merger agreement, the United Bankshares board of directors did not quantify or assign any relative weights to the factors considered, and individual directors may have given different weights to different factors. The United Bankshares board of directors considered all these factors as a whole, including discussions with, and questioning of, United Bankshares management and United Bankshares’ financial and legal advisors, and overall considered the factors to be favorable to, and to support, its determination.

Opinion of Community Bankers Trust’s Financial Advisor

Community Bankers Trust retained Piper Sandler to act as financial advisor to Community Bankers Trust’s board of directors in connection with Community Bankers Trust’s consideration of a possible business combination. Community Bankers Trust selected Piper Sandler to act as its financial advisor because Piper Sandler is a nationally recognized investment banking firm whose principal business specialty is financial institutions. In the ordinary course of its investment banking business, Piper Sandler is regularly engaged in the valuation of financial institutions and their securities in connection with mergers and acquisitions and other corporate transactions.

Piper Sandler acted as financial advisor to Community Bankers Trust’s board of directors in connection with the proposed merger and participated in certain of the negotiations leading to the execution of the merger agreement. At the June 2, 2021 meeting at which Community Bankers Trust’s board of directors considered the merger and the merger agreement, Piper Sandler delivered to the board of directors its oral opinion, which was subsequently confirmed in writing on June 2, 2021, to the effect that, as of such date, the exchange ratio was fair to the holders of Community Bankers Trust’s common stock from a financial point of view. The full text of Piper Sandler’s opinion is attached as Appendix B to this prospectus and proxy statement. The opinion outlines the procedures followed, assumptions made, matters considered and qualifications and limitations on the review undertaken by Piper Sandler in rendering its opinion. The description of the opinion set forth below is qualified in its entirety by reference to the full text of the opinion. Holders of Community Bankers Trust common stock are urged to read the entire opinion carefully in connection with their consideration of the proposed merger.

 

42


Table of Contents

Piper Sandler’s opinion was directed to the board of directors of Community Bankers Trust in connection with its consideration of the merger and the merger agreement and does not constitute a recommendation to any shareholder of Community Bankers Trust as to how to vote at the special meeting. Piper Sandler’s opinion was directed only to the fairness, from a financial point of view, of the exchange ratio to the holders of Community Bankers Trust common stock and did not address the underlying business decision of Community Bankers Trust to engage in the merger, the form or structure of the merger or any other transactions contemplated in the merger agreement, the relative merits of the merger as compared to any other alternative transactions or business strategies that might exist for Community Bankers Trust or the effect of any other transaction in which Community Bankers Trust might engage. Piper Sandler also did not express any opinion as to the fairness of the amount or nature of the compensation to be received in the merger by any officer, director or employee of Community Bankers Trust or United Bankshares, or any class of such persons, if any, relative to the compensation to be received in the merger by any other shareholder. Piper Sandler’s opinion was approved by Piper Sandler’s fairness opinion committee.

In connection with its opinion, Piper Sandler reviewed and considered, among other things:

 

   

an execution copy of the merger agreement;

 

   

certain publicly available financial statements and other historical financial information of Community Bankers Trust and its banking subsidiary, Essex Bank, that Piper Sandler deemed relevant;

 

   

certain publicly available financial statements and other historical financial information of United Bankshares that Piper Sandler deemed relevant;

 

   

certain internal financial projections for Community Bankers Trust for the years ending December 31, 2021 and December 31, 2022 with an estimated long-term annual balance sheet and net income growth rate for the years ending December 31, 2023 through December 31, 2025, as well as estimated dividends per share for Community Bankers Trust for the years ending December 31, 2021 through December 31, 2025, as provided by the senior management of Community Bankers Trust;

 

   

publicly available median analyst GAAP net income estimates for United Bankshares for the years ending December 31, 2021 and December 31, 2022 and an estimated annual net income growth rate for the years ending December 31, 2023 through December 31, 2025, as confirmed by the senior management of United Bankshares, as well as estimated dividends per share for United Bankshares for the years ending December 31, 2021 through December 31, 2025, as provided by the senior management of United Bankshares;

 

   

the pro forma financial impact of the merger on United Bankshares based on certain assumptions relating to transaction expenses, purchase accounting adjustments and cost savings, as well as estimated net income for Community Bankers Trust for the years ending December 31, 2021 and December 31, 2022 with an estimated long-term annual net income growth rate for the years ending December 31, 2023 and December 31, 2024, as provided by the senior management of United Bankshares;

 

   

the publicly reported historical price and trading activity for Community Bankers Trust common stock and United Bankshares common stock, including a comparison of certain stock trading information for Community Bankers Trust common stock and United Bankshares common stock and certain stock indices, as well as similar publicly available information for certain other companies, the securities of which are publicly traded;

 

   

a comparison of certain financial and market information for Community Bankers Trust and United Bankshares with similar financial institutions for which information is publicly available;

 

   

the financial terms of certain recent business combinations in the bank and thrift industry (on a nationwide basis), to the extent publicly available;

 

   

the current market environment generally and the banking environment in particular; and

 

43


Table of Contents
   

such other information, financial studies, analyses and investigations and financial, economic and market criteria as Piper Sandler considered relevant.

Piper Sandler also discussed with certain members of the senior management of Community Bankers Trust and its representatives the business, financial condition, results of operations and prospects of Community Bankers Trust and held similar discussions with certain members of the senior management of United Bankshares and its representatives regarding the business, financial condition, results of operations and prospects of United Bankshares.

In performing its review, Piper Sandler relied upon the accuracy and completeness of all of the financial and other information that was available to and reviewed by Piper Sandler from public sources, that was provided to Piper Sandler by Community Bankers Trust or United Bankshares or their respective representatives, or that was otherwise reviewed by Piper Sandler, and Piper Sandler assumed such accuracy and completeness for purposes of rendering its opinion without any independent verification or investigation. Piper Sandler relied on the assurances of the respective managements of Community Bankers Trust and United Bankshares that they were not aware of any facts or circumstances that would have made any of such information inaccurate or misleading. Piper Sandler was not asked to and did not undertake an independent verification of any of such information and Piper Sandler did not assume any responsibility or liability for the accuracy or completeness thereof. Piper Sandler did not make an independent evaluation or perform an appraisal of the specific assets, the collateral securing assets or the liabilities (contingent or otherwise) of Community Bankers Trust or United Bankshares, nor was Piper Sandler furnished with any such evaluations or appraisals. Piper Sandler rendered no opinion or evaluation on the collectability of any assets or the future performance of any loans of Community Bankers Trust or United Bankshares. Piper Sandler did not make an independent evaluation of the adequacy of the allowance for loan losses of Community Bankers Trust or United Bankshares, or of the combined entity after the merger, and Piper Sandler did not review any individual credit files relating to Community Bankers Trust or United Bankshares. Piper Sandler assumed, with Community Bankers Trust’s consent, that the respective allowances for loan losses for both Community Bankers Trust and United Bankshares were adequate to cover such losses and would be adequate on a pro forma basis for the combined entity.

In preparing its analyses, Piper Sandler used certain internal financial projections for Community Bankers Trust for the years ending December 31, 2021 and December 31, 2022 with an estimated long-term annual balance sheet and net income growth rate for the years ending December 31, 2023 through December 31, 2025, as well as estimated dividends per share for Community Bankers Trust for the years ending December 31, 2021 through December 31, 2025, as provided by the senior management of Community Bankers Trust. In addition, Piper Sandler used publicly available median analyst GAAP net income estimates for United Bankshares for the years ending December 31, 2021 and December 31, 2022 and an estimated annual net income growth rate for the years ending December 31, 2023 through December 31, 2025, as confirmed by the senior management of United Bankshares, as well as estimated dividends per share for United Bankshares for the years ending December 31, 2021 through December 31, 2025, as provided by the senior management of United Bankshares. Piper Sandler also received and used in its pro forma analyses certain assumptions relating to purchase accounting adjustments and cost savings, as well as estimated net income for Community Bankers Trust for the years ending December 31, 2021 and December 31, 2022 with an estimated long-term annual net income growth rate for the years ending December 31, 2023 and December 31, 2024, as provided by the senior management of United Bankshares. With respect to the foregoing information, the senior managements of Community Bankers Trust and United Bankshares confirmed to Piper Sandler that such information reflected (or, in the case of the publicly available analyst estimates referred to above, were consistent with) the best currently available projections, estimates and judgments of those respective managements as to the future financial performance of Community Bankers Trust and United Bankshares, respectively, and the other matters covered thereby, and Piper Sandler assumed that the future financial performance reflected in such information would be achieved. Piper Sandler expressed no opinion as to such information, or the assumptions on which such information was based. Piper Sandler also assumed that there had been no material change in the respective assets, financial condition, results of operations, business or prospects of Community Bankers Trust or United Bankshares since the date of the

 

44


Table of Contents

most recent financial statements made available to Piper Sandler. Piper Sandler assumed in all respects material to its analysis that Community Bankers Trust and United Bankshares would remain as going concerns for all periods relevant to its analysis.

Piper Sandler also assumed, with Community Bankers Trust’s consent, that (i) each of the parties to the merger agreement would comply in all material respects with all material terms and conditions of the merger agreement and all related agreements, that all of the representations and warranties contained in such agreements were true and correct in all material respects, that each of the parties to such agreements would perform in all material respects all of the covenants and other obligations required to be performed by such party under such agreements and that the conditions precedent in such agreements were not and would not be waived, (ii) in the course of obtaining the necessary regulatory or third party approvals, consents and releases with respect to the merger, no delay, limitation, restriction or condition would be imposed that would have an adverse effect on Community Bankers Trust, United Bankshares, the merger or any related transactions, and (iii) the merger and any related transactions would be consummated in accordance with the terms of the merger agreement without any waiver, modification or amendment of any material term, condition or agreement thereof and in compliance with all applicable laws and other requirements. Finally, with Community Bankers Trust’s consent, Piper Sandler relied upon the advice that Community Bankers Trust received from its legal, accounting and tax advisors as to all legal, accounting and tax matters relating to the merger and the other transactions contemplated by the merger agreement. Piper Sandler expressed no opinion as to any such matters.

Piper Sandler’s opinion was necessarily based on financial, economic, regulatory, market and other conditions as in effect on, and the information made available to Piper Sandler as of, the date thereof. Events occurring after the date thereof could materially affect Piper Sandler’s opinion. Piper Sandler has not undertaken to update, revise, reaffirm or withdraw its opinion or otherwise comment upon events occurring after the date thereof. Piper Sandler expressed no opinion as to the trading value of Community Bankers Trust common stock or United Bankshares common stock at any time or what the value of United Bankshares common stock will be once it is actually received by the holders of Community Bankers Trust common stock.

In rendering its opinion, Piper Sandler performed a variety of financial analyses. The summary below is not a complete description of all the analyses underlying Piper Sandler’s opinion or the presentation made by Piper Sandler to Community Bankers Trust’s board of directors, but is a summary of the material analyses performed and presented by Piper Sandler. The summary includes information presented in tabular format. In order to fully understand the financial analyses, these tables must be read together with the accompanying text. The tables alone do not constitute a complete description of the financial analyses. The preparation of a fairness opinion is a complex process involving subjective judgments as to the most appropriate and relevant methods of financial analysis and the application of those methods to the particular circumstances. The process, therefore, is not necessarily susceptible to a partial analysis or summary description. Piper Sandler believes that its analyses must be considered as a whole and that selecting portions of the factors and analyses to be considered without considering all factors and analyses, or attempting to ascribe relative weights to some or all such factors and analyses, could create an incomplete view of the evaluation process underlying its opinion. Also, no company included in Piper Sandler’s comparative analyses described below is identical to Community Bankers Trust or United Bankshares and no transaction is identical to the merger. Accordingly, an analysis of comparable companies or transactions involves complex considerations and judgments concerning differences in financial and operating characteristics of the companies and other factors that could affect the public trading values or transaction values, as the case may be, of Community Bankers Trust and United Bankshares and the companies to which they were compared. In arriving at its opinion, Piper Sandler did not attribute any particular weight to any analysis or factor that it considered. Rather, Piper Sandler made qualitative judgments as to the significance and relevance of each analysis and factor. Piper Sandler did not form an opinion as to whether any individual analysis or factor (positive or negative) considered in isolation supported or failed to support its opinion, rather, Piper Sandler made its determination as to the fairness of the exchange ratio to the holders of Community Bankers Trust common stock on the basis of its experience and professional judgment after considering the results of all its analyses taken as a whole.

 

45


Table of Contents

In performing its analyses, Piper Sandler also made numerous assumptions with respect to industry performance, business and economic conditions and various other matters, many of which cannot be predicted and are beyond the control of Community Bankers Trust, United Bankshares, and Piper Sandler. The analyses performed by Piper Sandler are not necessarily indicative of actual values or future results, both of which may be significantly more or less favorable than suggested by such analyses. Piper Sandler prepared its analyses solely for purposes of rendering its opinion and provided such analyses to Community Bankers Trust’s board of directors at its June 2, 2021 meeting. Estimates on the values of companies do not purport to be appraisals or necessarily reflect the prices at which companies or their securities may actually be sold. Such estimates are inherently subject to uncertainty and actual values may be materially different. Accordingly, Piper Sandler’s analyses do not necessarily reflect the value of Community Bankers Trust common stock or United Bankshares common stock or the prices at which Community Bankers Trust or United Bankshares common stock may be sold at any time. The analyses of Piper Sandler and its opinion were among a number of factors taken into consideration by Community Bankers Trust’s board of directors in making its determination to approve the merger agreement and the analyses described below should not be viewed as determinative of the decision of Community Bankers Trust’s board of directors with respect to the fairness of the exchange ratio.

Summary of Proposed Merger Consideration and Implied Transaction Metrics.

Piper Sandler reviewed the financial terms of the proposed merger. As set forth in the merger agreement, at the effective time, each share of Community Bankers Trust common stock issued and outstanding immediately prior to the effective time, except for certain shares of Community Bankers Trust common stock as specified in the merger agreement, shall become and be converted into the right to receive, subject to the limitations set forth in the merger agreement, 0.3173 of a share, which we refer to as the exchange ratio, of United Bankshares common stock. Piper Sandler calculated an aggregate implied transaction value of approximately $309.0 million and an implied purchase price per share of $13.24 consisting of the implied value of 22,454,926 shares of Community Bankers Trust common stock and 1,901,500 Community Bankers Trust options outstanding at a weighted average strike price of $7.01, and based on the closing price of United Bankshares’ common stock on June 1, 2021. Based upon financial information for Community Bankers Trust as of or for the last twelve months, or LTM, ended March 31, 2021 and the closing price of Community Bankers Trust’s common stock on June 1, 2021, Piper Sandler calculated the following implied transaction metrics:

 

Transaction Price / Tangible Book Value Per Share

     171%  

Transaction Price / LTM Earnings Per Share

     14.4x  

Transaction Price / 2021 Est. Median Consensus Earnings Per Share

     13.8x  

Transaction Price / 2022 Est. Median Consensus Earnings Per Share

     17.4x  

Transaction Price / 2021 Est. Community Bankers Trust Projected Earnings Per Share¹

     15.8x  

Transaction Price / 2022 Est. Community Bankers Trust Projected Earnings Per Share¹

     16.8x  

Tangible Book Premium / Core Deposits (CDs > $100K)2

     12.1%  

Tangible Book Premium / Core Deposits (CDs > $250K)3

     10.3%  

Market Premium as of June 1, 2021

     49.7%  

 

1 

as provided by Community Bankers Trust senior management

2 

Core deposits defined as total deposits less time deposits with balances greater than $100,000

3 

Core deposits defined as total deposits less time deposits with balances greater than $250,000

 

46


Table of Contents

Stock Trading History.

Piper Sandler reviewed the publicly available historical reported trading prices of Community Bankers Trust common stock and United Bankshares common stock for the one-year and three-year periods ended June 1, 2021. Piper Sandler then compared the relationship between the movements in the price of Community Bankers Trust common stock and United Bankshares common stock, respectively, to movements in their respective peer groups (as described below) as well as certain stock indices.

Community Bankers Trust’s One-Year Stock Performance

 

     Beginning Value
June 1, 2020
    Ending Value
June 1, 2021
 

Community Bankers Trust

     100     161.3

Community Bankers Trust Peer Group

     100     160.2

S&P 500 Index

     100     137.5

Nasdaq Bank Index

     100     179.3

Community Bankers Trust’s Three-Year Stock Performance

 

     Beginning Value
June 1, 2018
    Ending Value
June 1, 2021
 

Community Bankers Trust

     100     89.7

Community Bankers Trust Peer Group

     100     108.3

S&P 500 Index

     100     153.7

NASDAQ Bank Index

     100     112.9

United Bankshares’ One-Year Stock Performance

 

     Beginning Value
June 1, 2020
    Ending Value
June 1, 2021
 

United Bankshares

     100     144.8

United Bankshares Peer Group

     100     170.6

S&P 500 Index

     100     137.5

Nasdaq Bank Index

     100     179.3

United Bankshares’ Three-Year Stock Performance

 

     Beginning Value
June 1, 2018
    Ending Value
June 1, 2021
 

United Bankshares

     100     112.7

United Bankshares Peer Group

     100     104.3

S&P 500 Index

     100     153.7

Nasdaq Bank Index

     100     112.9

 

47


Table of Contents

Comparable Company Analyses.

Piper Sandler used publicly available information to compare selected financial information for Community Bankers Trust with a group of financial institutions selected by Piper Sandler. The group, which we refer to as the Community Bankers Trust Peer Group included major-exchange traded (NYSE, NYSEAM, Nasdaq) banks and thrifts headquartered in the Southeast region or Maryland with total assets between $1.0B and $3.0B, but excluded targets of announced mergers, and also excluded Shore Bancshares, Inc. due to its pending merger with Severn Bancorp, Inc.. The Community Bankers Trust Peer Group consisted of the following companies:

 

C&F Financial Corporation    MetroCity Bankshares, Inc.
Capital Bancorp, Inc.    MVB Financial Corp.
Citizens Holding Company    National Bankshares, Inc.
Colony Bankcorp, Inc.    Old Point Financial Corporation
First Community Corporation    Partners Bancorp
First National Corporation    Peoples Bancorp of North Carolina, Inc.
First United Corporation    Professional Holding Corp.
FVCBankcorp, Inc.    Southern First Bancshares, Inc.
Howard Bancorp, Inc.    The Community Financial Corporation
MainStreet Bancshares, Inc.   

The analysis compared publicly available financial information for Community Bankers Trust with corresponding data for the Community Bankers Trust Peer Group as of or for the year ended March 31, 2021 (unless otherwise noted) with pricing data as of June 1, 2021. The table below sets forth the data for Community Bankers Trust and the median, mean, low and high data for the Community Bankers Trust Peer Group.

 

48


Table of Contents

Community Bankers Trust Comparable Company Analysis

 

     Community
Bankers
Trust
     Community
Bankers
Trust

Peer Group
Median
     Community
Bankers
Trust

Peer Group
Mean
     Community
Bankers
Trust

Peer Group
Low
     Community
Bankers
Trust

Peer Group
High
 

Total assets ($mm)

     1,699        1,799        1,888        1,028        2,646  

Loans / Deposits (%)

     85.1        78.6        79.5        52.0        106.9  

Non-performing assets / Total assets (%)1

     0.71        0.61        0.57        0.08        1.33  

Tangible common equity/Tangible assets (%)

     10.15        8.77        8.63        6.05        11.42  

Tier 1 Leverage Ratio (%)2

     10.43        9.70        9.79        6.93        12.23  

Total RBC Ratio (%)3

     13.83        14.83        15.30        12.51        19.88  

CRE / Total RBC Ratio (%)4

     301.1        233.3        237.8        51.6        375.5  

LTM Return on average assets (%)

     1.28        0.96        0.98        -0.56        2.23  

LTM Return on average equity (%)

     12.45        10.09        10.20        -4.71        21.25  

LTM Net interest margin (%)

     3.51        3.33        3.48        2.62        5.12  

LTM Efficiency ratio (%)

     56.78        62.08        62.86        41.71        83.23  

Price/Tangible book value (%)

     114        122        133        104        213  

Price/LTM Earnings per share (x)

     9.6        11.6        13.4        7.2        33.3  

Price/2021 Est. Earnings per share (x)5

     9.2        11.4        11.7        6.8        19.9  

Price/2022 Est. Earnings per share (x)5

     11.6        12.1        12.2        7.4        19.8  

Current Dividend Yield (%)

     2.7        2.1        1.8        0.0        5.0  

Market value ($mm)

     196        186        228        90        495  

 

1 

Bank level regulatory data shown for Citizens Holding Company.

2 

Bank level regulatory data shown for MVB Financial Corp., FVCBankcorp, Inc., MainStreet Bancshares, Inc., Partners Bancorp, Inc., First Community Corporation, Old Point Financial Corporation, First National Corporation, and Community Bankers Trust.

3 

Not Reported for MVB Financial Corp. and FVCBankcorp, Inc. given that the companies have elected into the Community Bank Leverage Ratio Framework; Bank level regulatory data shown for MainStreet Bancshares, Inc., Partners Bancorp, First Community Corporation, Old Point Financial Corporation, First National Corporation, and Community Bankers Trust.

4 

Bank level regulatory data shown for all but Southern First Bancshares, Inc., First United Corporation, and Peoples Bancorp of North Carolina, Inc.

5 

Based on median consensus analyst estimates

Piper Sandler used publicly available information to perform a similar analysis for United Bankshares by comparing selected financial information for United Bankshares with a group of financial institutions selected by Piper Sandler. The group, which we refer to as the United Bankshares Peer Group, included nationwide major-exchange traded (NYSE, NYSEAM, Nasdaq) banks and thrifts with total assets between $20.0 billion and $35.0 billion, but excluded targets of announced mergers, Bank OZK due to its unique business model, and Webster Financial Corporation, BancorpSouth Bank and Old National Bancorp due to their pending mergers with Sterling Bancorp, Cadence Bancorporation and First Midwest Bancorp, Inc., respectively. The United Bankshares Peer Group consisted of the following companies:

 

Ameris Bancorp    Investors Bancorp, Inc.
Associated Banc-Corp    Pacific Premier Bancorp, Inc.
Bank of Hawaii Corporation    PacWest Bancorp
Commerce Bancshares, Inc.    Simmons First National Corporation
First Hawaiian, Inc.    UMB Financial Corporation
Fulton Financial Corporation    Umpqua Holdings Corporation

 

49


Table of Contents

The analysis compared publicly available financial information for United Bankshares with corresponding data for the United Bankshares Peer Group as of or for the year ended March 31, 2021 (unless otherwise noted) with pricing data as of June 1, 2021. The table below sets forth the data for United Bankshares and the median, mean, low and high data for the United Bankshares Peer Group.

United Bankshares Comparable Company Analysis

 

     United
Bankshares
     United
Bankshares

Peer Group
Median
     United
Bankshares

Peer Group
Mean
     United
Bankshares

Peer Group
Low
     United
Bankshares

Peer Group
High
 

Total assets ($mm)

     27,031        25,858        27,293        20,173        34,669  

Loans / Deposits (%)

     81.2        72.8        75.9        58.3        109.8  

Non-performing assets / Total assets (%)1

     0.44        0.40        0.43        0.13        0.83  

Tangible common equity/Tangible assets (%)

     9.93        7.95        8.24        6.06        10.39  

Tier 1 Leverage Ratio (%)

     10.38        9.07        8.76        6.61        10.43  

Total RBC Ratio (%)

     15.68        14.50        14.87        13.60        17.50  

CRE / Total RBC Ratio (%)

     228.0        226.2        230.4        89.3        435.8  

LTM Return on average assets (%)

     1.38        1.07        1.13        0.55        1.85  

LTM Return on average equity (%)

     8.44        9.65        10.64        3.98        16.85  

LTM Net interest margin (%)

     3.22        2.83        3.02        2.42        3.89  

LTM Efficiency ratio (%)

     48.74        55.98        55.38        44.66        66.37  

Price/Tangible book value (%)

     215        206        202        133        288  

Price/LTM Earnings per share (x)

     15.0        13.7        14.5        9.7        21.7  

Price/2021 Est. Earnings per share (x)2

     15.1        13.6        14.1        11.0        20.3  

Price/2022 Est. Earnings per share (x)2

     17.0        15.0        15.0        11.1        22.2  

Current Dividend Yield (%)

     3.4        2.9        2.7        1.1        4.4  

Market value ($mm)

     5,388        3,825        4,362        2,828        9,143  

 

1 

Bank level regulatory data shown for Ameris Bancorp.

2 

Based on median consensus analyst estimates.

Analysis of Precedent Transactions.

Piper Sandler reviewed a group of recent nationwide merger and acquisition transactions. The group, which we refer to as the Nationwide Precedent Transactions, consisted of nationwide bank and thrift transactions announced between January 1, 2020 and June 1, 2021 with disclosed deal values with the target’s total assets between $1.0 billion and $3.0 billion, but excluded mergers-of-equals and take-private transactions.

The Nationwide Precedent Transactions group was composed of the following transactions:

 

Acquiror

  

Target

First Bancorp.    Select Bancorp, Inc.
Enterprise Financial Services Corp    First Choice Bancorp
Nicolet Bankshares, Inc.    Mackinac Financial Corporation
VyStar Credit Union    Heritage Southeast Bancorporation, Inc.
Peoples Bancorp Inc.    Premier Financial Bancorp, Inc.
Banc of California, Inc.    Pacific Mercantile Bancorp
Stock Yards Bancorp, Inc.    Kentucky Bancshares, Inc.
First Busey Corporation    Cummins-American Corp.
First Mid Bancshares, Inc.    LINCO Bancshares, Inc.
Dollar Mutual Bancorp    Standard AVB Financial Corp.
Enterprise Financial Services Corp    Seacoast Commerce Banc Holdings

 

50


Table of Contents

Acquiror

  

Target

Provident Financial Services, Inc.    SB One Bancorp
United Community Banks, Inc.    Three Shores Bancorporation, Inc.
LendingClub Corporation    Radius Bancorp, Inc.
Heartland Financial USA, Inc.    AIM Bancshares, Inc.
Business First Bancshares, Inc.    Pedestal Bancshares, Inc.

Using the latest publicly available information prior to the announcement of the relevant transaction, Piper Sandler reviewed the following transaction metrics: deal value, transaction price to LTM earnings per share, transaction price to median consensus analyst estimated earnings per share, transaction price to tangible book value per share, core deposit premium, and one-day market premium. Piper Sandler compared the indicated transaction metrics for the transaction to the median, mean, low and high metrics of the Nationwide Precedent Transactions group.

 

           Nationwide Precedent Transactions  
     United
Bankshares /
Community
Bankers
Trust
    Median      Mean      Low      High  

Deal Value ($M)

     309       211        228        145        398  

Transaction Price / LTM Earnings Per Share (x)

     14.4       14.9        16.9        9.2        29.2  

Transaction Price / Median Consensus Est. Earnings Per Share (x)

     13.8/15.8 1      14.4        15.8        8.8        24.7  

Transaction Price / Tangible Book Value Per Share (%)

     171       154        154        102        210  

Tangible Book Value Premium to Core Deposits (%)

     12.12/10.3 3      7.1        7.1        1.4        12.7  

1-Day Market Premium (%)

     49.7       29.8        37.2        9.5        75.9  

 

1 

Earnings per share estimate per Community Bankers Trust management.

2 

Core deposits defined as total deposits less time deposits with balances greater than $100,000.

3 

Core deposits defined as total deposits less time deposits with balances greater than $250,000.

Net Present Value Analyses.

Piper Sandler performed an analysis that estimated the net present value of Community Bankers Trust common stock assuming Community Bankers Trust performed in accordance with certain internal financial projections for Community Bankers Trust for the years ending December 31, 2021 and December 31, 2022 with an estimated long-term annual balance sheet and net income growth rate for the years ending December 31, 2023 through December 31, 2025, as well as estimated dividends per share for Community Bankers Trust for the years ending December 31, 2021 through December 31, 2025, as provided by the senior management of Community Bankers Trust. To approximate the terminal value of a share of Community Bankers Trust common stock at December 31, 2025, Piper Sandler applied price to 2025 earnings multiples ranging from 10.0x to 15.0x and multiples of 2025 tangible book value ranging from 100% to 150%. The terminal values were then discounted to present values using different discount rates ranging from 11.0% to 15.0%, which were chosen to reflect different assumptions regarding required rates of return of holders or prospective buyers of Community Bankers Trust common stock. As illustrated in the following tables, the analysis indicated an imputed range of values per share of Community Bankers Trust common stock of $5.90 to $9.75 when applying multiples of earnings and $6.22 to $10.33 when applying multiples of tangible book value.

 

51


Table of Contents

Earnings Per Share Multiples

 

Discount

Rate

   10.0x      11.0x      12.0x      13.0x      14.0x      15.0x  

11.0%

   $ 6.90      $ 7.47      $ 8.04      $ 8.61      $ 9.18      $ 9.75  

12.0%

     6.63        7.18        7.72        8.27        8.82        9.37  

13.0%

     6.37        6.90        7.42        7.95        8.47        9.00  

14.0%

     6.13        6.63        7.14        7.64        8.14        8.65  

15.0%

     5.90        6.38        6.86        7.35        7.83        8.31  

Tangible Book Value Per Share Multiples

 

Discount

Rate

   100%      110%      120%      130%      140%      150%  

11.0%

   $ 7.27      $ 7.88      $ 8.49      $ 9.11      $ 9.72      $ 10.33  

12.0%

     6.99        7.57        8.16        8.74        9.33        9.92  

13.0%

     6.72        7.28        7.84        8.40        8.96        9.52  

14.0%

     6.46        7.00        7.54        8.08        8.61        9.15  

15.0%

     6.22        6.73        7.25        7.76        8.28        8.80  

Piper Sandler also considered and discussed with Community Bankers Trust’s board of directors how this analysis would be affected by changes in the underlying assumptions, including variations with respect to earnings. To illustrate this impact, Piper Sandler performed a similar analysis, assuming Community Bankers Trust’s earnings varied from 20.0% above projections to 20.0% below projections. This analysis resulted in the following range of per share values for Community Bankers Trust’s common stock, applying the price to 2025 earnings multiples range of 10.0x to 15.0x referred to above and a discount rate of 13.20%.

Earnings Per Share Multiples

 

Annual Budget

Variance

   10.0x      11.0x      12.0x      13.0x      14.0x      15.0x  

(20.0%)

   $ 5.28      $ 5.70      $ 6.12      $ 6.53      $ 6.95      $ 7.36  

(10.0%)

     5.80        6.27        6.74        7.21        7.68        8.15  

0.0%

     6.32        6.84        7.36        7.89        8.41        8.93  

10.0%

     6.84        7.42        7.99        8.56        9.13        9.71  

20.0%

     7.36        7.99        8.61        9.24        9.86        10.49  

Piper Sandler also performed an analysis that estimated the net present value per share of United Bankshares common stock, assuming United Bankshares performed in accordance with publicly available median analyst GAAP net income estimates for United Bankshares for the years ending December 31, 2021 and December 31, 2022 and an estimated annual net income growth rate for the years ending December 31, 2023 through December 31, 2025, as confirmed by the senior management of United Bankshares, as well as estimated dividends per share for United Bankshares for the years ending December 31, 2021 through December 31, 2025, as provided by the senior management of United Bankshares. To approximate the terminal value of a share of United Bankshares common stock at December 31, 2025, Piper Sandler applied price to 2025 earnings multiples ranging from 12.0x to 19.5x and multiples of 2025 tangible book value ranging from 150% to 250%. The terminal values were then discounted to present values using different discount rates ranging from 8.0% to 12.0%, which were chosen to reflect different assumptions regarding required rates of return of holders or prospective buyers of United Bankshares common stock. As illustrated in the following tables, the analysis indicated an imputed range of values per share of United Bankshares common stock of $24.38 to $42.87 when applying multiples of earnings and $26.81 to $48.67 when applying multiples of tangible book value.

 

52


Table of Contents

Earnings Per Share Multiples

 

Discount

Rate

   12.0x      13.5x      15.0x      16.5x      18.0x      19.5x  

8.0%

   $ 28.55      $ 31.41      $ 34.28      $ 37.14      $ 40.01      $ 42.87  

9.0%

     27.43        30.17        32.91        35.65        38.40        41.14  

10.0%

     26.36        28.99        31.61        34.24        36.86        39.49  

11.0%

     25.35        27.86        30.38        32.89        35.41        37.92  

12.0%

     24.38        26.80        29.21        31.62        34.03        36.44  

Tangible Book Value Per Share Multiples

 

Discount

Rate

   150%      170%      190%      210%      230%      250%  

8.0%

   $ 31.43      $ 34.88      $ 38.32      $ 41.77      $ 45.22      $ 48.67  

9.0%

     30.18        33.48        36.78        40.08        43.38        46.68  

10.0%

     29.00        32.16        35.32        38.48        41.64        44.80  

11.0%

     27.88        30.90        33.93        36.96        39.98        43.01  

12.0%

     26.81        29.71        32.61        35.51        38.41        41.31  

Piper Sandler also considered and discussed with Community Bankers Trust’s board of directors how this analysis would be affected by changes in the underlying assumptions, including variations with respect to earnings. To illustrate this impact, Piper Sandler performed a similar analysis assuming United Bankshares’ earnings varied from 20.0% above estimates to 20.0% below estimates. This analysis resulted in the following range of per share values for United Bankshares common stock, applying the price to 2025 earnings multiples range of 12.0x to 19.5x referred to above and a discount rate of 10.34%.

Earnings Per Share Multiples

 

Annual Estimate

Variance

   12.0x      13.5x      15.0x      16.5x      18.0x      19.5x  

(20.0%)

   $ 21.87      $ 23.94      $ 26.01      $ 28.08      $ 30.15      $ 32.23  

(10.0%)

     23.94        26.27        28.60        30.93        33.26        35.59  

0.0%

     26.01        28.60        31.19        33.78        36.37        38.95  

10.0%

     28.08        30.93        33.78        36.63        39.47        42.32  

20.0%

     30.15        33.26        36.37        39.47        42.58        45.68  

Piper Sandler noted that the net present value analysis is a widely used valuation methodology, but the results of such methodology are highly dependent upon the numerous assumptions that must be made, and the results thereof are not necessarily indicative of actual values or future results.

Pro Forma Transaction Analysis.

Piper Sandler analyzed certain potential pro forma effects of the merger on United Bankshares assuming the transaction closes on December 31, 2021. Piper Sandler utilized the following information and assumptions: (a) estimated net income for Community Bankers Trust for the years ending December 31, 2021 and December 31, 2022 with an estimated long-term annual net income growth rate for the years ending December 31, 2023 and December 31, 2024, as provided by the senior management of United Bankshares, (b) publicly available median analyst GAAP net income estimates for United Bankshares for the years ending December 31, 2021 and December 31, 2022 and an estimated annual net income growth rate for the years ending December 31, 2023 through December 31, 2025, as confirmed by the senior management of United Bankshares,

 

53


Table of Contents

as well as estimated dividends per share for United Bankshares for the years ending December 31, 2021 through December 31, 2025, as provided by the senior management of United Bankshares, and (c) certain assumptions relating to transaction expenses, purchase accounting adjustments and cost savings as provided by the senior management of United Bankshares. The analysis indicated that the transaction could be accretive to United Bankshares’ estimated earnings per share (excluding one-time transaction costs and expenses) in the years ending December 31, 2022 through December 31, 2024 and accretive to United Bankshares’ estimated tangible book value per share at close.

In connection with this analysis, Piper Sandler considered and discussed with the Community Bankers Trust’s board of directors how the analysis would be affected by changes in the underlying assumptions, including the impact of final purchase accounting adjustments determined at the closing of the transaction, and noted that the actual results achieved by the combined company may vary from projected results and the variations may be material.

Piper Sandler’s Relationship.

Piper Sandler is acting as Community Bankers Trust’s financial advisor in connection with the transaction and will receive a fee for such services in an amount equal to 1.25% of the aggregate transaction value, which fee is contingent upon the closing of the merger. Based on the estimated aggregate transaction value at the time of announcement of the transaction, Piper Sandler’s fee would be approximately $3.8 million. Piper Sandler also received a $300,000 fee from Community Bankers Trust upon rendering its opinion, which opinion fee will be credited in full towards the transaction fee that will become payable to Piper Sandler upon closing of the transaction. Community Bankers Trust has also agreed to indemnify Piper Sandler against certain claims and liabilities arising out of Piper Sandler’s engagement and to reimburse Piper Sandler for certain of its out-of-pocket expenses incurred in connection with Piper Sandler’s engagement.

Piper Sandler has not provided any other investment banking services to Community Bankers Trust in the two years preceding the date of its opinion. Piper Sandler provided certain investment banking services to United Bankshares in the two years preceding the date of its opinion. In summary, Piper Sandler acted as financial advisor to United Bankshares in connection with its acquisition of Carolina Financial Corporation, which transaction closed in May 2020 and for which Piper Sandler received approximately $2.1 million in compensation. In addition, in the ordinary course of Piper Sandler’s business as a broker-dealer, Piper Sandler may purchase securities from and sell securities to Community Bankers Trust and United Bankshares. Piper Sandler may also actively trade the equity and debt securities of Community Bankers Trust and United Bankshares for its own account and for the accounts of Piper Sandler’s customers.

Certain Unaudited Prospective Financial Information

United Bankshares and Community Bankers Trust do not as a matter of course make public projections as to future performance, revenues, earnings or other financial results due to, among other reasons, the inherent uncertainty of the underlying assumptions and estimates. However, United Bankshares and Community Bankers Trust are including in this prospectus and proxy statement certain unaudited prospective financial information that each of United Bankshares and Community Bankers Trust made available to the other party in connection with the other party’s evaluation of the merger and to Piper Sandler, in its capacity as Community Bankers Trust’s financial advisor. The inclusion of this information should not be regarded as an indication that any of United Bankshares, Community Bankers Trust, Piper Sandler, their respective representatives or any other recipient of this information considered, or now considers, it to be necessarily predictive of actual future results or that it should be construed as financial guidance, and it should not be relied on as such.

The following unaudited financial information was prepared solely for internal use and is subjective in many respects. The unaudited prospective financial information reflects numerous estimates and assumptions made with respect to business, economic, market, competition, regulatory and financial conditions and matters

 

54


Table of Contents

specific to United Bankshares’ and Community Bankers Trust’s respective businesses, all of which are difficult to predict and many of which are beyond United Bankshares’ and Community Bankers Trust’s control. The unaudited prospective financial information reflects both assumptions as to certain business decisions that are subject to change and, in many respects, subjective judgment, and thus is susceptible to multiple interpretations and periodic revisions based on actual experience and business developments. Neither United Bankshares nor Community Bankers Trust can give any assurance that the unaudited prospective financial information and the underlying estimates and assumptions will be realized. In addition, since the unaudited prospective financial information covers multiple years, such information by its nature becomes less predictive with each successive year. Actual results may differ materially from those set forth below, and important factors that may affect actual results and cause the unaudited prospective financial information to be inaccurate include, but are not limited to, risks and uncertainties relating to United Bankshares’ and Community Bankers Trust’s respective businesses, industry performance, general business and economic conditions, customer requirements, competition and adverse changes in applicable laws, regulations or rules. For other factors that could cause actual results to differ, please see the sections entitled “Cautionary Statement Regarding Forward-Looking Statements” and “Risk Factors” beginning on page 23 and page 16, respectively, of this prospectus and proxy statement and in United Bankshares’ and Community Bankers Trust’s respective Annual Reports on Form 10-K for the fiscal year ended December 31, 2020, and the other reports filed by each of United Bankshares and Community Bankers Trust with the SEC.

The unaudited prospective financial information was not prepared with a view toward public disclosure, nor was it prepared with a view toward compliance with U. S. generally accepted accounting principles, or GAAP, published guidelines of the SEC or the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of prospective financial information. In addition, the unaudited prospective financial information requires significant estimates and assumptions that make it inherently less comparable to the similarly titled GAAP measures in United Bankshares’ or Community Bankers Trust’s historical GAAP financial statements. Neither United Bankshares’ nor Community Bankers Trust’s independent registered public accounting firm, nor any other independent accountants, have compiled, examined or performed any procedures with respect to the unaudited prospective financial information contained herein, nor have they expressed any opinion or any other form of assurance on such information or its achievability. The independent registered public accountant reports included in this prospectus and proxy statement relate to historical financial information of each of United Bankshares and Community Bankers Trust. They do not extend to the unaudited prospective financial information and should not be read to do so.

Furthermore, the unaudited prospective financial information does not take into account any circumstances or events occurring after the date it was prepared. Neither United Bankshares nor Community Bankers Trust can give any assurance that, had the unaudited prospective financial information been prepared as of the date of this prospectus and proxy statement, similar estimates and assumptions would be used. United Bankshares and Community Bankers Trust each do not intend to, and disclaim any obligation to, make publicly available any update or other revision to the unaudited prospective financial information to reflect circumstances existing since their preparation or to reflect the occurrence of unanticipated events, even in the event that any or all of the underlying assumptions are shown to be in error, or to reflect changes in general economic or industry conditions. The unaudited prospective financial information does not take into account the possible financial and other effects on either United Bankshares or Community Bankers Trust, as applicable, of the merger and does not attempt to predict or suggest future results of the combined company. The unaudited prospective financial information of Community Bankers Trust and United Bankshares does not give effect to the impact of negotiating or executing the merger agreement, the expenses that may be incurred in connection with consummating the merger, the potential synergies that may be achieved by the combined company as a result of the merger, the effect of any business or strategic decision or action that has been or will be taken as a result of the merger agreement having been executed, or the effect on either United Bankshares or Community Bankers Trust, as applicable, of any business or strategic decisions or actions that would likely have been taken if the merger agreement had not been executed, but which were instead altered, accelerated, postponed or not taken in anticipation of the merger. Further, the unaudited prospective financial information does not take into account the

 

55


Table of Contents

effect on either United Bankshares or Community Bankers Trust, as applicable, of any possible failure of the merger to occur. None of United Bankshares, Community Bankers Trust, Piper Sandler or their respective affiliates, officers, directors, advisors or other representatives has made, makes or is authorized in the future to make any representation to any shareholder of United Bankshares or Community Bankers Trust or other person regarding United Bankshares’ or Community Bankers Trust’s ultimate performance compared to the information contained in the unaudited prospective financial information or that the projected results will be achieved.

The inclusion of the unaudited prospective financial information herein should not be deemed an admission or representation by United Bankshares or Community Bankers Trust that such information is viewed as material information of United Bankshares or Community Bankers Trust, respectively, particularly in light of the inherent risks and uncertainties associated with such information.

In light of the foregoing, and considering that the special meeting will be held several months after the unaudited prospective financial information was prepared, as well as the uncertainties inherent in any forecasted information, Community Bankers Trust shareholders are cautioned not to place unwarranted reliance on such information, and all Community Bankers Trust shareholders are urged to review United Bankshares’ most recent SEC filings for a description of United Bankshares’ reported financial results and Community Bankers Trust’s most recent SEC filings for a description of Community Bankers Trust’s reported financial results. See “Where You Can Find More Information” on page 99 of this prospectus and proxy statement.

Certain Unaudited Prospective Financial Information of Community Bankers Trust

For purposes of Piper Sandler’s net present value analysis on Community Bankers Trust performed in connection with its opinion, Piper Sandler used certain internal financial projections for Community Bankers Trust for the years ending December 31, 2021 and December 31, 2022, as well as an estimated long-term annual growth rate of 6% for the years ending December 31, 2023 through December 31, 2025, and estimated dividends per share for the years ending December 31, 2021 through December 31, 2025, as provided by the senior management of Community Bankers Trust. The following table summarizes this unaudited prospective financial information used by Piper Sandler for its Community Bankers Trust net present value analysis:

 

     For the Years Ended December 31,  
     2021     2022      2023      2024      2025  

Net Income ($000s)

   $ 18,500     $ 17,403      $ 18,448      $ 19,555      $ 20,728  

Earnings per Share ($)

   $ 0.84     $ 0.79      $ 0.83      $ 0.89      $ 0.94  

Dividends per Share ($)

   $ 0.25 (1)    $ 0.29      $ 0.33      $ 0.37      $ 0.41  

Tangible Book Value per Share ($)

   $ 8.03     $ 8.52      $ 9.01      $ 9.51      $ 10.03  

 

(1)

Includes estimated dividends totaling $0.19 per share for the quarters ending June 30, 2021, September 30, 2021 and December 31, 2021.

For purposes of Piper Sandler’s pro forma transaction analysis performed in connection with its opinion, Piper Sandler used net income of $21.6 million and $16.9 million for Community Bankers Trust for the years ending December 31, 2021 and December 31, 2022, respectively, as well as a long-term net income growth rate of 4% for the years ending December 31, 2023 and December 31, 2024, as provided by the senior management of United Bankshares. The following tables summarize this unaudited prospective financial information used by Piper Sandler for its pro forma transaction analysis:

 

     For the Years Ended
December 31,
 
     2021      2022      2023      2024  

Net Income ($000s)

   $ 21,600      $ 16,900      $ 17,600      $ 18,300  

 

56


Table of Contents

Certain Unaudited Prospective Financial Information of United Bankshares

For purposes of Piper Sandler’s net present value analysis on United Bankshares and its pro forma transaction analysis performed in connection with its opinion, Piper Sandler used publicly available median analyst GAAP net income estimates for United Bankshares for the years ending December 31, 2021 and December 31, 2022, as well as an estimated annual net income growth rate of 4% for the years ending December 31, 2023 through December 31, 2025, and estimated dividends per share for the years ending December 31, 2021 through December 31, 2025, as provided by the senior management of United Bankshares. The following table summarizes this unaudited prospective financial information used by Piper Sandler for its United Bankshares net present value analysis and its pro forma transaction analysis:

 

     For the Years Ended December 31,  
     2021     2022      2023      2024      2025  

Net Income ($000s)

   $ 355,900     $ 313,300      $ 325,832      $ 338,860      $ 352,387  

Earnings per Share ($)

   $ 2.76     $ 2.45      $ 2.55      $ 2.65      $ 2.75  

Dividends per Share ($)

   $ 1.41 (1)    $ 1.44      $ 1.45      $ 1.48      $ 1.49  

Tangible Book Value per Share ($)

   $ 20.28     $ 21.31      $ 22.41      $ 23.58      $ 24.84  

 

(1)

Includes estimated dividends totaling $1.06 per share for the quarters ending June 30, 2021, September 30, 2021 and December 31, 2021.

Certain Unaudited Prospective Pro Forma Financial Information

The following unaudited pro forma financial information reflecting the effect of the merger was provided by senior management of United Bankshares to Piper Sandler for its pro forma transaction analysis and was reviewed by Community Bankers Trust:

 

   

Cost savings equal to 30% of Community Bankers Trust’s projected non-interest expense;

 

   

Approximately $20 million in one-time pre-tax merger costs;

 

   

Purchase accounting adjustments of a gross loan credit mark of approximately $24 million, or 2.0% of gross loans; and

 

   

Core deposit intangibles of 0.25% of Community Bankers Trust’s non-time deposits, amortized sum-of-years digits method over 10 years.

Public Trading Markets

United Bankshares common stock trades on Nasdaq under the symbol “UBSI.” Community Bankers Trust common stock trades on Nasdaq under the symbol “ESXB.” Upon completion of the merger, Community Bankers Trust common stock will be delisted from Nasdaq and deregistered under the Exchange Act. The newly issued United Bankshares common stock issuable pursuant to the merger agreement will be listed on Nasdaq.

No Dissenters’ or Appraisal Rights

In general, dissenters’ appraisal rights are statutory rights that, if applicable under law, enable shareholders to dissent from an extraordinary transaction, such as a merger, and to demand that the corporation pay the fair value for their shares as determined by a court in a judicial proceeding instead of receiving the consideration offered to shareholders in connection with the extraordinary transaction.

Section 13.1-730 of the Virginia Stock Corporation Act provides that shareholders of a Virginia corporation such as Community Bankers Trust have the right, in some circumstances, to dissent from certain corporate action and to instead demand payment of the fair value of their shares. However, shareholders do not have dissenters’ rights with respect to shares of any class of stock that are listed on the New York Stock Exchange or listed on Nasdaq on the record date fixed to determine the shareholders entitled to receive notice of the meeting of shareholders to act upon the corporate action requiring appraisal rights.

 

57


Table of Contents

Community Bankers Trust common stock is listed on Nasdaq; therefore, holders of Community Bankers Trust common stock will not be entitled to dissenters’ appraisal rights in the merger with respect to their shares of Community Bankers Trust common stock.

Interests of Certain Community Bankers Trust Directors and Executive Officers in the Merger

In considering the recommendations of the Community Bankers Trust board of directors that Community Bankers Trust shareholders vote in favor of the Merger Proposal, Community Bankers Trust shareholders should be aware that Community Bankers Trust directors and executive officers may have interests in the merger that differ from, or are in addition to, their interests as shareholders of Community Bankers Trust. The Community Bankers Trust board of directors was aware of these interests and took them into account in its decision to approve and adopt the merger agreement and the transactions contemplated by the merger agreement, including the merger.

Options to Acquire Community Bankers Trust Common Stock

As of the record date for the Community Bankers Trust special meeting, the Community Bankers Trust directors and executive officers owned, in the aggregate, options to purchase 1,072,500 shares of Community Bankers Trust common stock granted under a Community Bankers Trust equity compensation plan. Under the merger agreement, at the effective time of the merger each such stock option that is outstanding and not yet exercised immediately prior to the merger, whether vested or unvested, will vest pursuant to the terms thereof and will be converted into an option to acquire, on the same terms and conditions as were applicable under such stock option, the number of shares of United Bankshares common stock equal to (a) the number of shares of Community Bankers Trust common stock subject to such stock option multiplied by (b) 0.3173. Such product will be rounded down to the nearest whole number. The exercise price per share (rounded up to the next whole cent) of each United Bankshares stock option issued for the Community Bankers Trust stock option will equal (y) the exercise price per share of shares of Community Bankers Trust common stock that were purchasable pursuant to such Community Bankers Trust stock option divided by (z) 0.3173.

As of the record date for the special meeting, shares underlying options that will vest at the effective time of the merger held by the Community Bankers Trust named executive officers were as follows: Rex L. Smith, III, 105,000; Bruce E. Thomas, 52,500; Jeff R. Cantrell, 52,500; and John M. Oakey, III, 52,500. The foregoing share amounts do not include any reduction in vesting required either as a result of Section 280G of the Code or certain provisions of the Community Bankers Trust 2019 Stock Incentive Plan that limit the number of awards thereunder that may have a vesting schedule of less than one year. Patricia M. Davis resigned as executive vice president and chief credit officer of Community Bankers Trust effective February 28, 2021.

Restricted Stock Units of Community Bankers Trust Common Stock

As of the record date for the Community Bankers Trust special meeting, the Community Bankers Trust directors and executive officers owned, in the aggregate, 35,000 restricted stock units of Community Bankers Trust common stock granted under a Community Bankers Trust equity compensation plan. At the effective time of the merger, each restricted stock unit granted under a Community Bankers Trust stock plan that is outstanding immediately prior to the effective time of the merger will vest only in accordance with the formula and other terms of the such stock plan (which generally will result in pro-rata vesting), be cancelled and converted automatically into the right to receive shares of United Bankshares common stock based on the 0.3173 exchange ratio. Any unvested restricted stock units that do not vest in accordance with a Community Bankers Trust equity compensation plan will be converted into restricted stock units of United Bankshares, as adjusted to take into account the exchange ratio.

Based on restricted stock unit awards outstanding as of the record date for the special meeting, shares underlying restricted stock units that Community Bankers Trust expects to vest at the effective time of the

 

58


Table of Contents

merger held by the Community Bankers Trust named executive officers are as follows: Mr. Smith, 3,071; Mr. Thomas, 1,535; Mr. Cantrell, 1,535; and Mr. Oakey, 1,535. The foregoing share amounts do not include any reduction in vesting required as a result of Section 280G of the Code.

Change in Control Employment Agreements with Community Bankers Trust

The Community Bankers Trust named executive officers (other than Ms. Davis) each have a change in control employment agreement with Community Bankers Trust. The change in control employment agreements are substantially identical. Each agreement is for a term that expires on December 31, 2025, with automatic renewals on that date and every 10th anniversary of that date, unless non-renewal notice is sent by the September 30 prior to the applicable December 31 ten-year renewal date. Each agreement provides for the employment of the officer following a “change in control” (as defined in each agreement) of Community Bankers Trust for a period of two years. During such period, the officer will receive a base salary that is equal to at least the base salary that the officer received for the 12 months before the change in control. In addition, the officer will be entitled to participation opportunities in incentive, savings, retirement and benefit plans at the same level as other similarly situated officers, with such participation opportunities to be at least as favorable as the officer’s participation opportunities in such plans during the six months prior to the change in control. Also during such period, the officer will be entitled to participation in welfare benefit plans, fringe benefits and vacation pay, at the same level as other similarly situated officers, with such benefits to be at least as favorable, in the aggregate, as the most favorable of such plans during the six months prior to the change in control, with six months continuation of family hospitalization, health and dental plan participation after retirement or expiration of the two year period.

If the officer is terminated “without cause” or terminates for “good reason” (as defined in each agreement), in each case within two years following a change in control of Community Bankers Trust, the officer will receive (i) as “accrued obligations,” salary, bonuses (including, but not limited to, bonus for the most recently completed year, and a pro-rated portion thereof for the current year), incentives and benefits that would be owed through the date of termination, (ii) a salary continuation benefit that equals 3.0 times the sum of the officer’s highest salary during the 12 months prior to termination plus the officer’s highest annual bonus during the two years prior to termination, minus $1.00, (iii) continuation of welfare benefits, in which the officer or his dependents were participating immediately prior to the termination, for 12 months, and (iv) outplacement services in the amount of up to $25,000. If the officer’s termination is due to “death” or “disability” (as defined in each agreement), in each case within two years following a change in control of Community Bankers Trust, the officer will receive salary, bonuses, incentives and benefits that would be owed through the date of termination, three months of base salary and continuation of benefits (for dependents only in the case of death) for 12 months.

In connection with the merger, Community Bankers Trust has agreed to terminate each officer’s change in control employment agreement immediately prior to the effective time of the merger in exchange for a lump sum payment equal to the amount that such officer would be due under the agreement if a change in control of Community Bankers Trust occurred and the officer experienced a qualifying termination of employment. Assuming the effective date of the merger and a qualifying termination of employment of each named executive officer occurred on July 15, 2021, the approximate lump sum payments for the named executive officers would be as follows: Mr. Smith, $1,573,706; Mr. Thomas, $786,568; Mr. Cantrell, $789,158; and Mr. Oakey, $785,601; provided, however, that each agreement provides that the change in control payments and benefits to the officer will be reduced as necessary, and as may be directed by the officer, so that no such payment or benefit will be nondeductible as an “excess parachute payment” under Section 280G of the Code. Accordingly, the aggregate change in control severance payments and benefits payable to the named executive officers pursuant to the merger are expected to be limited to approximately the following amounts: Mr. Smith, $1,629,040; Mr. Thomas, $844,696; Mr. Cantrell, $850,057; and Mr. Oakey, $707,388.

 

59


Table of Contents

Community Bankers Trust 2021 Bonus Payments

Immediately prior to the effective time of the merger, in satisfaction of the “accrued obligations” payment provisions described above with respect to the change in control employment agreements, Community Bankers Trust expects to make full-year (rather than pro-rata) bonus payments for the current year based on the achievement of the greater of actual (not to exceed “maximum”) or “target” level performance objectives for 2021 pursuant to the Community Bankers Trust annual objectives-based incentive plan in amounts not to exceed the following: Mr. Smith, $165,375; Mr. Thomas, $56,563; Mr. Cantrell, $56,750; and Mr. Oakey, $56,563. If not for the merger, such bonus amounts would be determined based on full-year 2021 performance against preestablished objectives and would be paid in early 2022.

Employment Agreement between Rex L. Smith, III and United Bank Following the Merger

Mr. Smith has signed a new employment agreement with United Bank, which will be effective on the effective date of the merger, to be employed as a regional president of United Bank for legacy Essex Bank locations in Virginia. Mr. Smith’s new employment agreement with United Bank has a three-year term and provides for an initial annual base salary of $350,000. During the term of the agreement, Mr. Smith will be entitled to receive an annual retention bonus of $100,000 and an annual incentive bonus of $74,250. Mr. Smith will be entitled to participate in all benefit plans (including equity plans) in the same manner as similarly situated employees and to the use of a company-owned automobile under United Bank’s policy for use of company cars as then in effect. Mr. Smith will also be entitled to reimbursement of up to $4,916 per one-year period for long-term care insurance premiums. In addition, if Mr. Smith’s employment terminates within the first five years after the effective time of the merger, United Bank will pay Mr. Smith an amount equal to the monthly cost of his medical and dental coverage, for himself and his spouse, under the current or any successor health plan provided by United Bank to its employees until the earlier of (i) the end of such five-year period, or (ii) the date on which Mr. Smith obtains medical or dental coverage with any subsequent employer.

In the event Mr. Smith’s employment is terminated by United Bank without “cause” (as defined in the agreement) or voluntarily by Mr. Smith for certain limited reasons specified in the agreement, Mr. Smith will be entitled to receive a lump sum payment equal to the remaining base salary payments he would otherwise receive for the remaining term of the agreement and the payments described above respecting post-termination medical and dental coverage. All payments are subject to reduction if needed to avoid application of the excise tax under Code Section 4999.

Mr. Smith will be subject to customary post-employment non-competition, non-piracy and non-solicitation covenants under the agreement for a period of one year beginning after termination of his employment with United Bank for any reason. The geographic area of the non-competition restriction will be limited to 30 miles from United Bank’s main office.

Community Bankers Trust Non-Qualified Defined Contribution Retirement Plan

The Community Bankers Trust named executive officers are participants in the Community Bankers Trust non-qualified defined contribution retirement plan. The purpose of the plan is to enhance the retirement benefits that Community Bankers Trust provides to each officer and to recognize each officer for overall performance through additional incentive-based compensation. The terms of the plan are set forth in a performance driven retirement agreement between Community Bankers Trust and each officer. Under each retirement agreement, Community Bankers Trust determines annual contributions to an individual deferred account for the officer on a discretionary basis. For all contributions made to the plan to date, Community Bankers Trust has based the amount of the contributions on the payouts made under its annual incentive plan. All contributions are fully vested when credited.

 

60


Table of Contents

Early termination benefits are payable commencing at age 65, and normal retirement benefits are payable at the later of age 65 and “separation from service” (as defined in each agreement). In the event of a separation from service of a named executive officer within 24 months following “change in control” (as defined in each agreement) of Community Bankers Trust, such officer will be entitled to receive the discounted present value of the projected account balance under the plan in a lump sum, subject to any applicable six month delay under the agreements and Code Section 409A. Pursuant to each agreement, such benefits will be reduced as necessary in order to comply with the limitations of Section 280G of the Code. See “– Certain Compensation for Community Bankers Trust Named Executive Officers – Golden Parachute Compensation.”

In addition, Community Bankers Trust expects to make contributions immediately prior to the effective time of the merger for the benefit of the named executive officers based on the achievement of the greater of actual (not to exceed “maximum”) or “target” level performance objectives for 2021 pursuant to the Community Bankers Trust performance-driven retirement agreements in amounts not to exceed the following: Mr. Smith, $264,600; Mr. Thomas, $33,938; Mr. Cantrell, $45,400; and Mr. Oakey, $45,250. If not for the merger, the amount of such contributions would be determined based on full-year 2021 performance against preestablished objectives and would be made in early 2022 with the contribution effective as of December 31, 2021.

Insurance and Indemnification

For a period of six years after the effective time of the merger, United Bankshares has agreed to provide, to the fullest extent permitted by applicable law and Community Bankers Trust’s articles of incorporation and bylaws, indemnification and advancement of reasonable expenses to each of Community Bankers Trust’s directors, officers and employees against all losses that are incurred in connection with their service with Community Bankers Trust and pertaining to any matter existing at or before the effective time of the merger. In addition, for a period of six years from the effective time of the merger, United Bankshares has agreed to provide director’s and officer’s liability insurance with respect to claims against such directors and officers arising from facts or events that occurred before the effective time of the merger, which insurance will contain at least the same coverage and amounts, and contain terms and conditions no less advantageous, as that coverage currently provided by Community Bankers Trust. In no event will United Bankshares be required to expend, on an annual basis, more than 200% of the current annual amount expended by Community Bankers Trust to maintain such directors’ and officers’ insurance coverage. In lieu of the foregoing, United Bankshares may obtain at or prior to the effective time a six-year “tail” policy under Community Bankers Trust’s existing directors’ and officers’ insurance policy providing equivalent coverage to that described in the preceding sentence if and to the extent that the same may be obtained for an amount that, in the aggregate, does not exceed 200% of the current annual amount expended by Community Bankers Trust to maintain such directors and officers insurance coverage. See the section entitled “The Merger Agreement – Indemnification; Directors’ and Officers’ Insurance” beginning on page 68.

Advisory Board

United Bankshares will invite all members of the Community Bankers Trust board of directors to serve on United Bank’s Richmond Advisory Board or another appropriate advisory board maintained by United Bankshares or United Bank for the region in which the individual resides.

Certain Compensation for Community Bankers Trust Named Executive Officers

The following table sets forth the information required by Item 402(t) of Regulation S-K promulgated by the SEC regarding certain merger-related compensation that the Community Bankers Trust named executive officers may be entitled to receive pursuant to their existing agreements with Community Bankers Trust. The amounts below were calculated assuming (i) that the effective date of the merger and a qualifying termination of employment of each named executive officer occurred on July 15, 2021, and (ii) a per share value of Community Bankers Trust common stock of $11.90, which is the average closing price per share of Community Bankers

 

61


Table of Contents

Trust common stock as quoted on The Nasdaq Capital Market over the first five business days following the first public announcement of the merger on June 3, 2021. The amounts below do not include (i) the value of benefits in which the named executive officers are vested without regard to the occurrence of a change in control, or (ii) certain compensation actions that may occur following the effective time of the merger, including but not limited to any payments made or benefits received under Mr. Smith’s new employment agreement with United Bankshares. The amounts below also do not reflect the anticipated reductions in payments and benefits so that no such payment or benefit will be nondeductible as an “excess parachute payment” under Section 280G of the Code. As described above, the aggregate change in control severance payments and benefits payable to the named executive officers pursuant to the merger are expected to be limited to approximately the following amounts: Mr. Smith, $1,629,040; Mr. Thomas, $844,696; Mr. Cantrell, $850,057; and Mr. Oakey, $707,388.

The merger-related compensation payable to the Community Bankers Trust named executive officers is subject to a non-binding advisory vote of the Community Bankers Trust shareholders, as described under “Proposal No. 2 – Advisory (Non-Binding) Vote on Certain Merger-Related Compensation for Community Bankers Trust Named Executive Officers” beginning on page 31.

Golden Parachute Compensation

 

Name

   Cash(1)      Equity (2)      Pension/
NQDC (3)
     Perquisites/
Benefits
     Tax
Reimbursement
     Other      Total  

Rex L. Smith

   $ 1,739,081      $ 403,418      $ 21,404      $ —        $ —        $ —        $ 2,163,903  

Bruce E. Thomas

   $ 843,130      $ 201,715      $ 180,781      $ —        $ —        $ —        $ 1,225,626  

Jeff R. Cantrell

   $ 845,908      $ 201,715      $ 226,548      $ —        $ —        $ —        $ 1,274,171  

John M. Oakey, III

   $ 842,164      $ 201,715      $ 445,589      $ —        $ —        $ —        $ 1,489,468  

 

1)

The amounts represent payments that Community Bankers Trust intends to make upon its unilateral termination of the officers’ change in control employment agreements immediately prior to the effective time of the merger. The amounts reflect the double trigger payments and benefits (i.e., amounts triggered by a change in control for which payment is conditioned upon the officer’s termination without cause or resignation for good reason within the term of the agreement following the change in control) that would otherwise be due to the officers pursuant to their respective change in control employment agreements with Community Bankers Trust. The change in control employment agreements provide for, in addition to the above-described accrued obligations, (i) a lump sum change in control payment equal to 3.0 times the sum of the officer’s highest salary during the 12 months prior to termination plus the officer’s highest annual bonus during the two years prior to termination, minus $1.00, (ii) continuation of welfare benefits for 12 months after termination, and (iii) outplacement services in the amount of up to $25,000. The amounts also include, as part of the payment of accrued obligations, full-year (rather than pro-rata) bonus payments for the current year expected to be made by Community Bankers Trust immediately prior to the effective time of the merger to the named executive officers based on the achievement of the greater of actual (not to exceed “maximum”) or “target” level performance objectives for 2021 pursuant to the Community Bankers Trust annual objectives-based incentive plan in amounts not to exceed the following: Mr. Smith, $165,375; Mr. Thomas, $56,563; Mr. Cantrell, $56,750; and Mr. Oakey, $56,563. If not for the merger, such bonus amounts would be determined based on full-year 2021 performance against preestablished objectives and would be paid in early 2022.

 

2)

The amounts represent the aggregate value of shares underlying (i) in-the-money options, and (ii) restricted stock units of Community Bankers Trust that, in each case, will accelerate and vest as a result of the merger. These values are calculated pursuant to the rules of the SEC and, with respect to the options, are different from, and significantly higher than, the values determined for purposes of Section 280G of the Code, which values are determined as of the date of the change in control and are based on several factors, including the stock’s fair market value and the length of time until the unvested options would otherwise have vested, assuming no change in control.

 

62


Table of Contents
3)

The amounts represent the discounted present value of the projected account balance under the Community Bankers Trust non-qualified defined contribution retirement plan as of July 15, 2021 to Messrs. Smith, Thomas, Cantrell and Oakey, respectively, as follows: $21,404, $180,781, $226,548, $445,589, in excess of the account balance as of July 15, 2021, to which the officer would be entitled if not for the merger. The amounts include retirement contributions expected to be made by Community Bankers Trust immediately prior to the effective time of the merger for the benefit of the named executive officers based on the achievement of the greater of actual (not to exceed “maximum”) or “target” level performance objectives for 2021 pursuant to the Community Bankers Trust performance-driven retirement agreements, as described above, in approximately the following amounts: Mr. Smith, $264,600; Mr. Thomas, $33,938; Mr. Cantrell, $45,400; and Mr. Oakey, $45,250.

Accounting Treatment of the Merger

The merger will be accounted for using acquisition accounting, in accordance with GAAP, for accounting and financial reporting purposes. Under acquisition accounting, the assets (including identifiable intangible assets) and liabilities (including executory contracts and other commitments) of Community Bankers Trust as of the effective time of the merger will be recorded at their respective fair values and added to those of United Bankshares. Any excess of purchase price over the fair values is recorded as goodwill. Consolidated financial statements of United Bankshares issued after the merger would reflect these fair values and would not be restated retroactively to reflect the historical consolidated financial position or results of operations of Community Bankers Trust.

THE MERGER AGREEMENT

The following is a summary of the material provisions of the merger agreement. The following description of the merger agreement is subject to, and qualified in its entirety by reference to, the merger agreement, which is attached to this prospectus and proxy statement as Appendix A and is incorporated by reference into this document. This summary may not contain all of the information about the merger agreement that may be important to you. You are urged to read the merger agreement carefully and in its entirety, as it is the legal document governing the merger.

Terms of the Merger

Each of the United Bankshares board of directors and the Community Bankers Trust board of directors has approved and adopted the merger agreement, which provides for the merger of Community Bankers Trust with and into United Bankshares. United Bankshares will be the surviving entity in the merger.

Each share of Community Bankers Trust common stock issued and outstanding immediately prior to the completion of the merger (other than shares held by United Bankshares and its subsidiaries, in each case except for shares held by them in a fiduciary capacity or as a result of debts previously contracted) will be converted into the right to receive 0.3173 shares of United Bankshares common stock, which is referred to herein as the exchange ratio. If the number of shares of common stock of United Bankshares changes before the merger is completed because of a reclassification, recapitalization, stock dividend, stock split, reverse stock split or similar event, then a proportionate adjustment will be made to the exchange ratio.

The United Bankshares articles of incorporation and the United Bankshares bylaws as in effect immediately prior to the completion of the merger will be the articles of incorporation and bylaws of the surviving entity.

After the effective time of the merger and as part of the same overall transaction, Essex Bank, a Virginia banking corporation and wholly-owned subsidiary of Community Bankers Trust, for no additional consideration and pursuant to the agreement and plan of merger dated June 2, 2021, attached as Exhibit 99.4 to the registration

 

63


Table of Contents

statement on Form S-4 of which this prospectus and proxy statement is a part, will merge with and into United Bank, a Virginia banking corporation, and a wholly-owned subsidiary of United Bankshares, or the bank merger. As a result of the bank merger, the separate existence of Essex Bank will cease and the corporate existence of United Bank, as the merged bank, shall continue unaffected and unimpaired by the bank merger and the merged bank shall be deemed to be the same business and corporate entity as each of Essex Bank and United Bank.

Treatment of Community Bankers Trust Stock Options

Under the merger agreement, at the effective time of the merger, each stock option to buy Community Bankers Trust common stock granted under a Community Bankers Trust equity compensation plan that is outstanding and not yet exercised immediately prior to the merger, whether vested or unvested, will vest pursuant to the terms thereof and will be converted into an option to acquire, on the same terms and conditions as were applicable under such stock option, the number of shares of United Bankshares common stock equal to (a) the number of shares of Community Bankers Trust common stock subject to such stock option multiplied by (b) 0.3173. Such product will be rounded down to the nearest whole number. The exercise price per share (rounded up to the next whole cent) of each United Bankshares stock option issued for a Community Bankers Trust stock option will equal (y) the exercise price per share of shares of Community Bankers Trust common stock that were purchasable pursuant to such Community Bankers Trust stock option divided by (z) 0.3173.

Each Community Bankers Trust stock option that is intended to be an “incentive stock option” (as defined in Section 422 of the Code) will be adjusted in accordance with the requirements of Section 424 of the Code and all Community Bankers Trust stock options will be adjusted in a manner that maintains the options’ exemption from Section 409A of the Code. At or prior to the effective time of the merger, Community Bankers Trust must use its reasonable best efforts to obtain any necessary consents from optionees with respect to the Community Bankers Trust equity compensation plans to permit replacement of the outstanding Community Bankers Trust stock options by United Bankshares and to permit United Bankshares to assume the Community Bankers Trust equity compensation plans. Community Bankers Trust must take all action necessary to amend the Community Bankers Trust equity compensation plans to eliminate automatic grants or awards thereunder following the effective time. At the effective time of the merger, United Bankshares will assume the Community Bankers Trust equity compensation plans, but such assumption will only be with respect to the United Bankshares replacement options granted pursuant to the merger agreement and United Bankshares will have no obligation to make any additional grants or awards under the Community Bankers Trust equity compensation plans.

Treatment of Community Bankers Trust Restricted Stock Units

Under the merger agreement, at the effective time of the merger, each restricted stock unit granted under a Community Bankers Trust stock plan that is outstanding immediately prior to the effective time of the merger shall vest only in accordance with the formula and other terms of the such stock plan, be cancelled and converted automatically into the right to receive shares of United common stock based on the 0.3173 exchange ratio. United shall issue the consideration for such restricted stock unit less applicable tax withholdings within five business days following the effective time of the merger. Any unvested restricted stock units that do not vest in accordance with a Community Bankers Trust equity compensation plan will be converted into restricted stock units of United Bankshares, as adjusted to take into account the exchange ratio.

Conditions of the Merger

The respective obligations of United Bankshares and Community Bankers Trust to consummate the merger are subject to the satisfaction of certain mutual conditions, including the following:

 

   

The shareholders of Community Bankers Trust approve the merger agreement and the transactions contemplated thereby, described in this prospectus and proxy statement, at the meeting of shareholders for Community Bankers Trust;

 

64


Table of Contents
   

All regulatory approvals required by law to consummate the transactions contemplated by the merger agreement are obtained from the Federal Reserve, the Virginia Bureau of Financial Institutions and the other appropriate federal and/or state regulatory agencies, all waiting periods after such approvals required by law or regulation expire and no such approvals contain any conditions or restrictions that the United Bankshares Board determines, using reasonable good faith judgment, would be a materially financially burdensome regulatory condition;

 

   

The registration statement (of which this prospectus and proxy statement is a part) registering shares of United Bankshares common stock to be issued in the merger is declared effective and not subject to a stop order and no proceedings suspending the effectiveness of the registration statement shall have been initiated or threatened by the SEC;

 

   

The absence of any statute, rule, regulation, judgment, decree, injunction or other order being enacted, issued, promulgated, enforced or entered by a governmental authority effectively prohibiting consummation of the merger; and

 

   

Authorization for the listing on Nasdaq of the shares of United Bankshares common stock to be issued in the merger, subject to official notice of issuance.

In addition to the mutual conditions described above, United Bankshares’ obligation to consummate the merger is subject to the satisfaction, unless waived, of the following other conditions:

 

   

The representations and warranties of Community Bankers Trust made in the merger agreement are true and correct as of the date of the merger agreement and as of the effective time of the merger and United Bankshares receives a certificate of the chief executive officer and the chief financial officer of Community Bankers Trust to that effect;

 

   

Community Bankers Trust performs in all material respects all obligations required to be performed by it under the merger agreement at or prior to the effective time of the merger and delivers to United Bankshares a certificate of its chief executive officer and chief financial to that effect;

 

   

United Bankshares shall have received an opinion of Bowles Rice LLP, counsel to United Bankshares, dated as of the effective time of the merger, that the merger will be treated as a “reorganization” under Section 368 of the Code; and

 

   

Neither Rex L. Smith, III, President and Chief Executive Officer of Community Bankers Trust and Essex Bank nor United Bank shall have taken any action on or before the effective time of the merger to materially breach or to cancel or terminate the employment agreement dated June 2, 2021 regarding Mr. Smith’s employment with United Bank.

In addition to the mutual conditions described above, Community Bankers Trust’s obligation to complete the merger is subject to the satisfaction, unless waived, of the following other conditions:

 

   

The representations and warranties of United Bankshares made in the merger agreement are true and correct as of the date of the merger agreement and as of the effective time of the merger and Community Bankers Trust receives a certificate of the chief executive officer and chief financial officer of United Bankshares to that effect;

 

   

United Bankshares performs in all material respects all obligations required to be performed by it under the merger agreement at or prior to the effective time of the merger and delivers to Community Bankers Trust a certificate of its chief executive officer and chief financial officer to that effect; and

 

   

Community Bankers Trust shall have received an opinion of Williams Mullen, counsel to Community Bankers Trust, dated as of the effective time of the merger, that the merger will be treated as a “reorganization” under Section 368 of the Code.

 

65


Table of Contents

Representations and Warranties

The merger agreement contains representations and warranties by United Bankshares and Community Bankers Trust. These representations and warranties are qualified by items previously disclosed and a materiality standard, which means that neither United Bankshares nor Community Bankers Trust is in breach of a representation or warranty unless the existence of any fact, event or circumstance, individually, or taken together with other facts, events or circumstances has had or is reasonably likely to have a material adverse effect on United Bankshares or Community Bankers Trust. These include, among other things, representations and warranties by United Bankshares and Community Bankers Trust to each other as to:

 

   

Organization and good standing of each entity and its subsidiaries;

 

   

Each entity’s capital structure;

 

   

Each entity’s power and authority relative to the execution and delivery of, and performance of its obligations under, the merger agreement;

 

   

Litigation and related matters;

 

   

Consents and approvals required;

 

   

Absence of conflicts between each entity’s obligations under the merger agreement and its charter documents and contracts to which it is a party or by which it is bound;

 

   

Accuracy of documents, including financial statements and other reports, filed by each entity with the SEC;

 

   

Absence of material adverse changes since December 31, 2020;

 

   

Regulatory matters;

 

   

Compliance with applicable laws, the Sarbanes-Oxley Act and accounting controls;

 

   

Absence of defaults under material contracts and agreements;

 

   

Employee benefit plans;

 

   

Absence of environmental problems;

 

   

Tax matters;

 

   

Absence of brokerage commissioners, except as disclosed for financial advisors;

 

   

Insurance matters;

 

   

Opinions of the parties’ respective financial advisors;

 

   

Allowance for loan and lease losses; and

 

   

Computer systems and technologies.

In addition to the representations and warranties listed above, Community Bankers Trust also made representations and warranties to United Bankshares with respect to the following:

 

   

Labor matters;

 

   

Risk management instruments;

 

   

The taking of all actions necessary to exempt the merger agreement from any takeover laws;

 

   

Books and records being fully and accurately maintained and fairly presenting events and transactions;

 

   

Loan matters;

 

   

Investment securities;

 

66


Table of Contents
   

Assets; and

 

   

Investment advisory services.

No representation or warranty contained in the merger agreement shall be deemed untrue or incorrect, and no party hereto shall be deemed to have breached a representation or warranty, as a consequence of the existence of any fact, event or circumstance unless such fact, event or circumstance, individually or taken together with all other facts, events or circumstances inconsistent with any representation or warranty contained in the merger agreement has had or is reasonably likely to have a “material adverse effect” on the party making the representation.

For the purposes of the merger agreement, a “material adverse effect” means any event, change, effect, development, state of facts, condition, circumstances or occurrence that, individually or in the aggregate, (i) is material and adverse to the financial position, results of operations or business of United Bankshares and its subsidiaries taken as a whole or Community Bankers Trust and its subsidiaries taken as a whole, respectively, or (ii) would materially impair the ability of either United Bankshares or Community Bankers Trust to perform its obligations under the merger agreement or otherwise materially threaten or materially impede the consummation of the merger and the other transactions contemplated by the merger agreement; provided, that the impact of the following items shall not be deemed to be a material adverse effect:

 

   

Changes in tax, banking and similar laws of general applicability or interpretations thereof by courts or governmental authorities (including COVID-19 pandemic measures), except to the extent that such changes have a disproportionate impact on United Bankshares or Community Bankers Trust, as the case may be, relative to the overall effects on the banking industry;

 

   

Changes in GAAP or regulatory accounting requirements applicable to banks and their holding companies generally, except to the extent that such changes have a disproportionate impact on United Bankshares or Community Bankers Trust, as the case may be, relative to the overall effects on the banking industry;

 

   

Changes in economic conditions affecting financial institutions generally, including changes in market interest rates, credit availability and liquidity, and price levels or trading volumes in securities markets, except to the extent that such changes have a disproportionate impact on United Bankshares or Community Bankers Trust, as the case may be, relative to the overall effects on the banking industry;

 

   

Any modifications or changes to valuation policies and practices in connection with the merger in accordance with GAAP;

 

   

Actions and omissions of United Bankshares or Community Bankers Trust taken with the prior written consent of the other in contemplation of the transactions contemplated by the merger agreement;

 

   

Any outbreak or escalation of hostilities or war (whether or not declared) or any act of terrorism, or any earthquakes, hurricanes, tornados or other natural disasters, or any national or global epidemic, pandemic or disease outbreak (including any outbreaks, epidemics or pandemics relating to COVID-19, or any variants or mutations thereof, or any other viruses, and the governmental and other responses thereto), or the material worsening of such conditions threatened or existing as of the date of the merger agreement (including any such changes arising out of the COVID-19 pandemic or any COVID-19 pandemic measures);

 

   

Failure of United Bankshares or Community Bankers Trust to meet any internal financial forecasts or any earnings projections (whether made by United Bankshares or Community Bankers Trust or any other person);

 

   

The public disclosure of the merger agreement and the impact thereof on relationships with customers or employees; or

 

67


Table of Contents
   

The effects of compliance with the merger agreement on the operating performance of the parties, including, expenses incurred by the parties in consummating the transactions contemplated by the merger agreement.

Waiver and Amendment

Prior to the effective time of the merger, any provision of the merger agreement may be waived by the party benefited by the provision or amended or modified by an agreement in writing between the parties, except that, after the special meeting, the merger agreement may not be amended if it would violate the Virginia Stock Corporation Act.

Indemnification; Directors’ and Officers’ Insurance

United Bankshares has agreed to indemnify the directors, officers and employees of Community Bankers Trust and its subsidiaries for a period of six years from the effective time of the merger to the fullest extent that Community Bankers Trust or any of its subsidiaries is permitted or required to indemnify (and advance expenses to) its directors and officers under the laws of the Commonwealth of Virginia, the articles of incorporation and bylaws of Community Bankers Trust and/or any of its subsidiaries and any indemnification agreements in effect between Community Bankers Trust and/or any of its subsidiaries and any director, officer or employee thereof. Additionally, United Bankshares has agreed to maintain in effect (i) the current indemnification provisions of the articles of incorporation and bylaws of Community Bankers Trust and/or its subsidiaries and (ii) any indemnification agreements in place with any directors, officers or employees of Community Bankers Trust and/or its subsidiaries, for a period of six years following the effective time of the merger.

United Bankshares has also agreed for a period of six years from the effective time of the merger to provided that portion of director’s and officer’s liability insurance that serves to reimburse the present and former officers and directors of Community Bankers Trust or any of its subsidiaries (determined as of the effective time) (as opposed to Community Bankers Trust) with respect to claims against such directors and officers arising from facts or events which occurred before the effective time, which insurance shall contain at least the same coverage and amounts, and contain terms and conditions no less advantageous, as that coverage currently provided by Community Bankers Trust. United Bankshares is not required to expend, on an annual basis, more than 200% of the current amount expended by Community Bankers Trust to maintain or procure such directors and officers liability insurance coverage. In lieu of the foregoing, United may obtain at or prior to the effective time of the merger a six-year “tail” policy under Community Bankers Trust’s existing directors’ and officers’ insurance policy providing equivalent coverage to that described in the preceding sentence if and to the extent that the same may be obtained for an amount that, in the aggregate, does not exceed more than 200% of the current amount expended by Community Bankers Trust to maintain or procure such directors’ and officers’ liability insurance coverage.

Special Meeting; Board Recommendation

Community Bankers Trust agrees to take, in accordance with applicable law and its articles of incorporation and bylaws, all action necessary to convene an appropriate meeting of its shareholders to consider and vote upon the approval of the merger agreement and any other matters required to be approved by Community Bankers Trust’s shareholders for consummation of the merger, as promptly as practicable after this registration statement, of which this prospectus and proxy statement is a part, is declared effective.

The Community Bankers Trust board of directors shall recommend that the Community Bankers Trust shareholders approve and adopt the merger agreement and the transactions contemplated thereby. However, the Community Bankers Trust board of directors may fail to make such recommendation, or change, withdraw, qualify or modify, or publicly propose to change, withdraw, qualify or modify, in a manner that is adverse to United, any such recommendation, which we refer to as an adverse recommendation change, if the Community

 

68


Table of Contents

Bankers Trust board of directors has, after having consulted with its financial advisor with respect to financial matters and having consulted with and considered the advice of its outside legal counsel, determined that the failure to make an adverse recommendation change would be reasonably likely to constitute a breach of the fiduciary duties of the members of the Community Bankers Trust board of directors under applicable law and complied with the terms set forth below.

Prior to making an adverse recommendation change, the Community Bankers Trust board of directors shall provide written notice to United Bankshares of its intent to announce an adverse recommendation change on the fifth business day following delivery of such notice, which notice shall specify any material terms and conditions of any applicable superior proposal (and include a copy thereof with all accompanying documentation, if in writing), and identify the person making such superior proposal, if applicable (it being understood that any amendment to any material term of such superior proposal shall require a new notice of recommendation change, except that, in such case, the five business day period referred to above shall be reduced to three business days following the delivery of such new notice of recommendation change).

After providing such notice of recommendation change, Community Bankers Trust shall negotiate in good faith with United Bankshares (if requested by United Bankshares) and provide United Bankshares reasonable opportunity during the subsequent five business day period to make such adjustments in the terms and conditions of the merger agreement as would enable the Community Bankers Trust board of directors to proceed without an adverse recommendation change (it being understood that United Bankshares shall not be required to propose any such adjustments). The Community Bankers Trust board of directors may make an adverse recommendation change, if, following such five business day period, determines in good faith, after consultation with its financial advisors and outside counsel, it determines that the failure to take such action would be reasonably likely to constitute a breach of the fiduciary duties of the members of the Community Bankers Trust board of directors under applicable law.

Acquisition Proposals

Community Bankers Trust agrees not to, solicit or encourage inquiries or proposals with respect to, or engage in any negotiations concerning, or provide any confidential information to, or have any discussions with any person relating to, any acquisition proposal. Community Bankers Trust has also agreed to cause its subsidiaries, officers, directors, agents, advisors and affiliates not to do so. Community Bankers Trust agreed to immediately cease and cause to be terminated any activities, discussions or negotiations conducted prior to the date of the merger agreement with any parties other than United Bankshares with respect to any of the foregoing and shall use its reasonable best efforts to enforce any confidentiality or similar agreement relating to an acquisition proposal. Community Bankers Trust agreed to inform United Bankshares promptly of all relevant details of any inquiries or contacts by third parties relating to the possible disposition of the business or the capital stock of Community Bankers Trust or any merger, change or control or other business combination involving Community Bankers Trust.

Notwithstanding these commitments, nothing in the merger agreement prohibits Community Bankers Trust, prior to the special meeting of Community Bankers Trust shareholders, and subject to compliance with the other terms of merger agreement, from furnishing nonpublic information to, or entering into discussions or negotiations with, any person that makes an unsolicited, bona fide written acquisition proposal with respect to Community Bankers Trust or any of its significant subsidiaries (that did not result from a breach of the applicable terms of the merger agreement), if, and only to the extent that (i) the Community Bankers Trust board of directors concludes in good faith, after consultation with and based upon the advice of outside legal counsel, that the failure to take such actions would be reasonably likely to constitute a breach of its fiduciary duties to its shareholders under applicable law, (ii) before taking such actions, Community Bankers Trust receives from such person an executed confidentiality agreement providing for reasonable protection of confidential information, which confidentiality agreement shall not provide such person or entity with any exclusive right to negotiate with Community Bankers Trust and shall contain terms and conditions no less favorable to Community Bankers Trust

 

69


Table of Contents

with respect to confidentiality than its confidentiality agreement with United Bankshares, and (iii) the Community Bankers Trust board of directors concludes in good faith, after consultation with its outside legal counsel and financial advisors, that the acquisition proposal constitutes or is reasonably likely to result in a superior proposal.

Community Bankers Trust shall promptly notify United Bankshares in writing of Community Bankers Trust’s receipt of any such acquisition proposal or inquiry, the material terms and conditions thereof, the identity of the person making such acquisition proposal or inquiry, and shall keep United Bankshares reasonably informed on a prompt basis, of the status and material terms of any such acquisition proposal and the status of discussions or negotiations with respect thereto, including any material amendments or proposed amendments as to price and other material terms thereof. Any violation of these restrictions by a representative of Community Bankers Trust shall be deemed a breach by Community Bankers Trust.

An “acquisition proposal” means any tender or exchange offer, proposal for a merger, consolidation or other business combination involving Community Bankers Trust or any of its significant subsidiaries or any proposal or offer to acquire equity interests representing 24.99% or more of the voting power of, or at least 24.99% of the assets or deposits of, Community Bankers Trust or any of its significant subsidiaries, other than the transactions contemplated by the merger agreement.

A “superior proposal” means an acquisition proposal that was received and considered by Community Bankers Trust in accordance with the applicable terms of the merger agreement that (i) would, if consummated, result in a transaction that is more favorable to Community Bankers Trust’s shareholders from a financial point of view than the merger, (ii) is fully financed or reasonably capable of being fully financed and (iii) is reasonably likely to receive all required approvals of governmental authorities on a timely basis and otherwise reasonably capable of being completed on the terms proposed.

If Community Bankers Trust, by a majority vote of members of the board of directors of Community Bankers Trust, terminates the merger agreement in order to concurrently enter into an agreement with respect to a superior proposal, provided that United Bankshares does not make a counteroffer that is at least as favorable to such proposal, it is obligated to pay to United Bankshares the termination fee equal to $12,132,000. See “– Effect of Termination; Termination Fee” on page 75.

Effective Time

The merger will be consummated and become effective upon the issuance of a certificate of merger by the Virginia State Corporation Commission and the West Virginia Secretary of State (or on such other date as may be specified in the articles of merger to be filed with the Virginia State Corporation Commission and the West Virginia Secretary of State). Provided that the conditions set forth in the merger agreement have been satisfied or waived, other than those conditions that by their nature are to be satisfied at the effective time of the merger, United Bankshares and Community Bankers Trust shall cause the effective date of the merger to occur on the date immediately prior to the conversion of the data processing systems of Essex Bank with the data processing systems of United Bank. However, if such date has not occurred by December 6, 2021, then the parties shall cause the effective date of the merger to occur on the sooner of (i) five business days thereafter if all of the conditions of the merger have been satisfied or waived as of such date or (ii) five business days following the satisfaction or waiver of the conditions set forth in the merger agreement, unless another date is agreed to by Community Bankers Trust and United Bankshares.

Regulatory Approvals

The merger and the bank merger require the approval of the Federal Reserve and the Virginia Bureau of Financial Institutions.

The transactions contemplated by the merger agreement require approval by the Federal Reserve pursuant to Section 3 of the Bank Holding Company Act of 1956, as amended, which we refer to as the BHCA, unless the

 

70


Table of Contents

Federal Reserve waives that requirement, and pursuant to Section 18(c)(2)(B) of the Federal Deposit Insurance Act, which we refer to as the Bank Merger Act.

The Federal Reserve takes into consideration a number of factors when acting on applications filed under Section 3 of the BHCA and the Bank Merger Act. These factors include the effect of the merger on competitiveness in affected banking markets, the financial and managerial resources (including consideration of the capital adequacy, liquidity, and earnings performance, as well as the competence, experience and integrity of the officers, directors and principal shareholders, and the records of compliance with applicable laws and regulations) and future prospects of the combined organization. The Federal Reserve also considers the effectiveness of the applicant in combatting money laundering, the convenience and needs of the communities to be served, as well as the extent to which the proposal would result in greater or more concentrated risks to the stability of the U.S. banking or financial system. The Federal Reserve has the authority to deny an application if it concludes that the combined organization would have inadequate capital. In addition, the Federal Reserve can withhold approval of the merger if, among other things, it determines that the effect of the merger would be to substantially lessen competition in the relevant market. Further, the Federal Reserve must consider whether the combined organization meets the requirements of the Community Reinvestment Act of 1977, which we refer to as the CRA, by assessing the involved entities’ records of meeting the credit needs of the local communities in which they operate, consistent with the safe and sound operation of such institutions.

In addition, a period of 15 to 30 days must expire following approval by the Federal Reserve before completion of the merger is allowed, within which period the United States Department of Justice may file objections to the merger under the federal antitrust laws.

The merger cannot be consummated prior to receipt of all required approvals. There can be no assurance that required regulatory approvals for the merger will be obtained or that the Federal Reserve will not request that United Bankshares withdraw its application (which it may do if issues arise during processing), and, if the merger is approved, as to the date of such approvals or whether the approvals will contain any unacceptable conditions. There can likewise be no assurance that the United States Department of Justice will not challenge the merger during the waiting period set aside for such challenges after receipt of approval from the Federal Reserve.

Under the merger agreement, United Bankshares is not required to agree to any condition or take any action if such agreement or the taking of such action is reasonably likely to result in any conditions or requirements that the United Bankshares board of directors reasonably determines in good faith would be materially financially burdensome to the business, operations, financial condition or results of operations of United Bankshares or Community Bankers Trust such that, had such condition or requirement been known, United Bankshares would not, in its reasonable good faith judgment, have entered into the merger agreement.

Should any other approval or action be required, it is presently contemplated that such approval or action would be sought. There can be no assurance that any necessary regulatory approvals or actions will be timely received or taken, that no action will be brought challenging such approval or action or, if such a challenge is brought, as to the result thereof, or that any such approval or action will not be conditioned in a manner that would cause the parties to abandon the merger. These approvals could be delayed or not obtained at all for various reasons, including an adverse development in either party’s regulatory standing, governmental or political inquiries, investigations or opposition, or changes in legislation or the political environment generally.

The approval of any application merely implies the satisfaction of regulatory criteria for approval, which does not include review of the merger from the standpoint of the adequacy of the exchange ratio for converting Community Bankers Trust common stock to United Bankshares common stock. Furthermore, regulatory approvals do not constitute an endorsement or recommendation of the merger.

As of the date of this prospectus and proxy statement, United Bankshares and Community Bankers Trust have filed all required applications or waivers thereof for regulatory approval. United Bankshares filed an

 

71


Table of Contents

application with the Federal Reserve for approval under the Bank Merger Act and filed a request for a waiver of the prior approval requirement under Section 3 of the BHCA using procedures outlined in applicable regulations. Applications were filed by United Bankshares with the Virginia Bureau of Financial Institutions. The Virginia Bureau of Financial Institutions approved the applications on September 7, 2021. The application and request for waiver submitted to the Federal Reserve are still under review by the Federal Reserve. We cannot be certain when or if we will receive approval from the Federal Reserve, or if obtained, whether such approval will contain terms, conditions or restrictions not currently contemplated that will be detrimental to the combined company after completion of the merger.

Conduct of Business Pending the Merger

The merger agreement contains reciprocal forbearances made by Community Bankers Trust and United Bankshares to each other. Community Bankers Trust and United Bankshares have agreed that, until the effective time of the merger, neither of them nor any of their subsidiaries, without the prior written consent of, or as previously disclosed to, the other, will:

 

   

Conduct business other than in the ordinary and usual course or fail to use reasonable efforts to preserve intact its business organizations and assets and maintain its rights, franchises and existing relations with customers, suppliers, employees and business associates, or take any action reasonably likely to have an adverse effect upon its ability to perform any of its material obligations under the merger agreement; or

 

   

Take any action that would, or is reasonably likely to, prevent or impede the merger from qualifying as a reorganization within the meaning of Section 368 of the Code, or knowingly take any action that is intended or is reasonably likely to result in any of the conditions to the merger not being satisfied, or a material violation of any provision of the merger agreement except, in each case, as may be required by applicable law or regulation.

Community Bankers Trust has also agreed that, prior to the effective time, without the prior written consent of, or as previously disclosed to, United Bankshares, it will not and will cause each of its subsidiaries not to:

 

   

Make any capital expenditure in excess of $500,000 in the aggregate;

 

   

Other than pursuant to rights previously disclosed and outstanding on the date of the merger agreement, issue, sell or otherwise permit to become outstanding, or authorize the creation of, any additional shares of Community Bankers Trust common stock or any rights to purchase Community Bankers Trust common stock, enter into any agreement with respect to the foregoing, or permit any additional shares of Community Bankers Trust common stock to become subject to new grants of employee or director stock options, other rights or similar stock based employee rights (other than equity compensation awards and issuances of Community Bankers Trust common stock, rights, employee or director stock options or similar equity compensation awards under a Community Bankers Trust equity compensation plan in the ordinary course of business consistent with past practice);

 

   

Except as previously disclosed, make, declare, pay or set aside for payment any dividend (other than quarterly cash dividends at a rate not to exceed $0.07 per share on Community Bankers Trust common stock and dividends from wholly-owned subsidiaries to Community Bankers Trust, or another wholly-owned subsidiary of Community Bankers Trust) on or in respect of, or declare or make any distribution on, any shares of Community Bankers Trust stock or directly or indirectly adjust, split, combine, redeem, reclassify, purchase or otherwise acquire, any shares of its capital stock;

 

   

Enter into or amend or renew any employment, change in control employment or similar agreement, consulting, compensation, bonus, severance or similar agreements or arrangements with any director,

 

72


Table of Contents
 

officer, employee, consultant or other independent contractor service provider of Community Bankers Trust or its subsidiaries, except as previously disclosed, or grant any salary or wage increase other than normal individual increases in compensation to employees in the ordinary course of business consistent with past practice;

 

   

Enter into, establish, adopt or amend (except (i) as may be required by applicable law, (ii) as previously disclosed or (iii) to satisfy previously disclosed contractual obligations existing as of the date of the merger agreement) any pension, retirement, stock option, stock purchase, or other equity incentive agreement, award or plan, savings, profit sharing, deferred compensation, supplemental employment retirement plan, performance driven retirement or similar agreement, consulting, bonus, group insurance, split dollar agreement or arrangement or other employee benefit, incentive or welfare contract, plan or arrangement, or any trust agreement (or similar arrangement) related thereto, in respect of any director, officer, employee, consultant or other independent contractor or other service provider of Community Bankers Trust or its subsidiaries, or take any action to accelerate the vesting or exercisability of stock options, restricted stock unit or other compensation or benefits payable thereunder;

 

   

Sell, transfer, mortgage, encumber or otherwise dispose of or discontinue any of its assets, deposits, business or properties except in the ordinary course of business and in a transaction that is not material to it and its subsidiaries taken as a whole;

 

   

Except in the ordinary course of business, acquire (other than by way of foreclosures or acquisitions of control in a bona fide fiduciary capacity or in satisfaction of debts previously contracted in good faith, in each case in the ordinary and usual course of business consistent with past practice) all or any portion of the assets, business, deposits or properties of any other entity;

 

   

Amend Community Bankers Trust’s articles of incorporation or bylaws or the articles of incorporation or bylaws (or similar governing documents) of any of Community Bankers Trust’s subsidiaries;

 

   

Implement or adopt any change in its accounting principles, practices or methods, other than as may be required by GAAP or its regulatory authorities;

 

   

Except in the ordinary course of business consistent with past practice, enter into or terminate any material contract or amend or modify any of its existing material contracts in a manner that is material to Community Bankers Trust and its subsidiaries, taken as a whole;

 

   

Except in the ordinary course of business consistent with past practice, settle any claim, action or proceeding, except for any claim, action or proceeding that does not involve precedent for other material claims, actions or proceedings and that involve solely money damages in an amount, individually or in the aggregate for all such settlements, that is not material to Community Bankers Trust and its subsidiaries taken as whole;

 

   

Except as required by applicable law or regulation, implement or adopt any material change in its interest rate or other risk management policies, practices or procedures, fail to materially follow existing policies or practices with respect to managing exposure to interest rate and other risk, or fail to use commercially reasonable means to avoid any material increase in its aggregate exposure to interest rate risk;

 

   

Incur any indebtedness for borrowed money other than in the ordinary course of business;

 

   

Organize or approve the organization of any subsidiaries; or

 

   

Agree or commit to do any of the foregoing.

 

73


Table of Contents

United Bankshares has agreed that, prior to the effective time, without the prior written consent of, or as previously disclosed to, Community Bankers Trust, it will not and will cause each of its subsidiaries not to:

 

   

Make, declare, pay or set aside for payment any extraordinary dividend, other than in connection with the United Bankshares stock repurchase program, provided that the foregoing restriction does not restrict United Bankshares from making, declaring or paying its regular quarterly cash dividends and dividends from wholly-owned subsidiaries to United Bankshares or another wholly-owned subsidiary of United Bankshares (which, for the avoidance of doubt, will continue to be paid);

 

   

Amend the United Bankshares articles of incorporation or bylaws in a manner that would materially and adversely affect the benefits of the merger to the shareholders of Community Bankers Trust; or

 

   

Agree or commit to do any of the foregoing.

Termination of the Merger Agreement

Community Bankers Trust and United Bankshares may mutually agree to terminate the merger agreement at any time upon a vote by a majority of the board of directors of each of Community Bankers Trust and United Bankshares.

Either Community Bankers Trust or United Bankshares may terminate the merger agreement if the merger is not complete by May 31, 2022, unless the failure of the merger to be consummated arises out of or results from the knowing action or inaction of the party seeking to terminate.

Either Community Bankers Trust or United Bankshares may terminate the merger agreement if (i) final action has been taken by any governmental authority whose approval is required for consummation of the merger and the other transactions contemplated by the merger agreement, which final action has become nonappealable and does not approve the merger agreement or the transactions contemplated by the merger agreement, or such governmental authority has approved of the merger agreement or the transactions contemplated by the merger agreement with a materially burdensome regulatory condition, or (ii) an application submitted to any governmental authority whose approval is required for the consummation of the merger has been permanently withdrawn at the request or suggestion of such governmental authority (except to the extent that such action, denial or withdrawal or the imposition of such condition is due to the failure of the party seeking to terminate to perform or observe the covenants of such party).

United Bankshares may terminate the merger agreement if any of the following occurs:

 

   

Community Bankers Trust materially breaches any of its representations, warranties, covenants or agreements under the merger agreement and does not or cannot cure the breach within 30 days of written notice of the breach;

 

   

The Community Bankers Trust shareholders do not approve the merger agreement;

 

   

As of May 31, 2022, (i) the continued accuracy of Community Bankers Trust’s representations and warranties in the merger agreement cannot be confirmed by Community Bankers Trust, (ii) the performance in all material respects of all of its obligations in the merger agreement cannot be confirmed by Community Bankers Trust, or (iii) Rex L. Smith, III, President and Chief Executive Officer of Community Bankers Trust and Essex Bank, has taken action on or before the effective time of the merger to materially breach or to cancel or terminate the employment agreement between United Bank and Mr. Smith dated June 2, 2021 (provided that such failure is not a result of United Bankshares’ failure to perform, in any material respect, any of its covenants or agreements contained in the merger agreement or the material breach by United Bankshares of any of its representations or warranties contained in the merger agreement);

 

   

The Community Bankers Trust board of directors fails (i) to recommend approval of the merger agreement, or changes, withdraws, qualifies or modifies in a manner that is adverse to United, (ii) to

 

74


Table of Contents
 

reaffirm its recommendation for approval of the merger agreement within 10 business days after United requests such reaffirmation in writing at any time following the public announcement of an acquisition proposal, or (iii) to comply in all material respects with its obligations under the merger agreement with respect to an acquisition proposal; or

 

   

Community Bankers Trust enters into any letter of intent, memorandum of understanding, agreement in principle, acquisition agreement, merger agreement, or other similar agreement constituting or related to, or which is intended to or would be reasonably likely to lead to any tender or exchange offer, proposal for a merger, consolidation or other business combination involving Community Bankers Trust or any of its significant subsidiaries or any proposal or offer to acquire equity interests representing 24.99% or more of the voting power of, or at least 24.99% of the assets or deposits of, Community Bankers Trust or any of its significant subsidiaries.

Community Bankers Trust may terminate the merger agreement if any of the following occurs:

 

   

United Bankshares materially breaches any of its representations, warranties, covenants or agreements under the merger agreement and does not or cannot cure the breach within 30 days of written notice of the breach;

 

   

As of May 31, 2022, United Bankshares is not able to confirm, (i) the continued accuracy of its representations and warranties in the merger agreement or (ii) the performance in all material respects of all of its obligations in the merger agreement (provided that such failure is not a result of Community Bankers Trust’s failure to perform, in any material respect, any of its covenants or agreements contained in the merger agreement or the material breach by Community Bankers Trust of any of its representations or warranties contained in the merger agreement); or

 

   

If both (i) the average of the closing sale prices of United Bankshares common stock, which we refer to as the average United Bankshares stock price, as reported on Nasdaq during the 20 consecutive full trading days ending at the closing of trading on the trading day immediately prior to the latest of (A) the date on which the last regulatory approval necessary is received (and any statutory waiting period in respect thereof has expired) or (B) the date on which the Community Bankers Trust shareholders approve the merger, which we refer to as the determination date, is less than $33.37, and (ii) (1) the quotient of the average United Bankshares stock price divided by $41.71, shall be less than 80% of (2) the quotient of the average of the daily current market price of the KBW Regional Banking Index, which we refer to as the Index, for the 20 consecutive full trading days ending at the closing of trading on the trading day immediately prior to the determination date divided by the closing price for the Index on June 1, 2021 of $129.29. If Community Bankers Trust elects to terminate under the provision described above, United Bankshares shall have the option to increase the per share exchange ratio or pay an additional cash payment to each Community Bankers Trust shareholder as part of the merger consideration.

Additionally, Community Bankers Trust may terminate the merger agreement in order to enter into an agreement with respect to a superior proposal, provided that United Bankshares does not make a counteroffer that the Community Bankers Trust board of directors determines is at least as favorable to such proposal and Community Bankers Trust pays the termination fee described below.

Effect of Termination; Termination Fee

If the merger agreement is validly terminated, the merger agreement will become void without any liability on the part of any party except that provisions relating to expenses and the termination fee will continue in effect and termination will not relieve a breaching party from liability for any willful breach of the merger agreement.

 

75


Table of Contents

Community Bankers Trust has agreed to pay a termination fee to United Bankshares equal to $12,132,000 if:

 

   

Community Bankers Trust terminates the merger agreement in order to concurrently enter into an agreement with respect to a superior proposal, provided United Bankshares does not make a counteroffer that the Community Bankers Trust board of directors determines is at least as favorable to such proposal;

 

   

United terminates the merger agreement because Community Bankers Trust enters into a letter of interest, memorandum of understanding, acquisition agreement, merger agreement or other similar agreement constituting or related to, or which is intended to or would be reasonably likely to lead to any proposal for a merger, consolidation or other business combination involving the offer or sale of 50.01% or more of the voting power, assets or deposits of Community Bankers Trust; or

 

   

United Bankshares terminates the merger agreement because (i) the Community Bankers Trust board of directors fails to recommend, withdraws, modifies or changes its recommendation of the merger in a manner adverse in any respect to the interests of United Bankshares or (ii) Community Bankers Trust fails to comply in all material respects with (A) its obligations to call a meeting of shareholders to approve the merger agreement and recommend approval of the same or (B) its obligations not to solicit acquisition proposals, and within 12 months after the date of termination of the merger agreement, Community Bankers Trust enters into an agreement with respect to another acquisition proposal or consummates another acquisition proposal.

Surrender of Stock Certificates

Computershare Limited will act as exchange agent in the merger and in that role will process the exchange of Community Bankers Trust stock certificates and non-certificated shares of Community Bankers Trust common stock, or book-entry shares, for United Bankshares common stock. The exchange agent, or United Bankshares and Community Bankers Trust if the exchange agent declines to do so, will also be making any computations required by the merger agreement, and all such computations will be conclusive and binding on the holders of Community Bankers Trust common stock in the absence of manifest error. In any event, do not forward your Community Bankers Trust stock certificates with your proxy card.

As soon as practicable after the effective time of the merger, but in no event later than five business days thereafter, United Bankshares shall cause the exchange agent to mail to each holder of record of one or more Community Bankers Trust stock certificates or book-entry shares representing shares of Community Bankers Trust common stock immediately prior to the effective time that have been converted at the effective time into the right to receive the merger consideration, a letter of transmittal (which shall specify that delivery shall be effected, and risk of loss and title to the Community Bankers Trust stock certificates shall pass, only upon proper delivery of the Community Bankers Trust stock certificates or book-entry shares to the exchange agent) and instructions for use in effecting the surrender of the Community Bankers Trust stock certificates or book-entry shares in exchange for book-entry shares representing the number of whole shares of United Bankshares common stock and any cash in lieu of fractional shares that the shares of Community Bankers Trust common stock represented by such Community Bankers Trust stock certificate or book-entry shares have been converted into the right to receive pursuant to the merger agreement, as well as any dividends or distributions to be paid pursuant to the merger agreement.

From and after the effective time, upon proper surrender of a Community Bankers Trust stock certificate or book-entry shares for exchange and cancellation to the exchange agent, together with such properly completed letter of transmittal, duly executed, the holder of such Community Bankers Trust stock certificates or book-entry shares shall be entitled to receive in exchange therefor, as applicable, (i) book-entry shares representing that number of whole shares of United Bankshares common stock to which such holder of Community Bankers Trust common stock shall have become entitled under the merger agreement and (ii) a check representing the amount

 

76


Table of Contents

of (A) any cash in lieu of fractional shares that such holder has the right to receive in respect of the Community Bankers Trust stock certificate or book-entry shares surrendered and (B) any dividends or distributions that the holder thereof has the right to receive pursuant to the merger agreement, and the Community Bankers Trust stock certificate or book-entry shares so surrendered shall forthwith be cancelled. Until surrendered, each Community Bankers Trust stock certificate or book-entry shares shall be deemed at any time after the effective time to represent only the right to receive, upon surrender, the merger consideration, any cash in lieu of fractional shares payable, and any cash in respect of dividends or distributions as contemplated by the merger agreement.

No dividends or other distributions declared with respect to United Bankshares common stock shall be paid to the holder of any un-surrendered Community Bankers Trust stock certificate or book-entry shares until the holder thereof has surrendered such Community Bankers Trust Stock Certificate or book-entry shares. After the surrender of a Community Bankers Trust stock certificate or book-entry shares, the record holder thereof shall be entitled to receive any such dividends or other distributions, without any interest thereon, with respect to the whole shares of United Bankshares common stock that the shares of Community Bankers Trust common stock represented by such Community Bankers Trust stock certificate or book-entry shares have been converted into (i) with a record date and a payment date on or after the effective time and on or prior to the date of such surrender, and (ii) at the appropriate payment date, with a record date on or after the effective time but prior to the date of such surrender and a payment date subsequent to the date of such surrender.

After the completion of the merger, there will be no further transfers of Community Bankers Trust common stock. Community Bankers Trust stock certificates and book-entry shares presented for transfer after the completion of the merger will be cancelled and exchanged for the merger consideration.

If your Community Bankers Trust stock certificates have been either lost, stolen or destroyed, you will have to prove your ownership of these certificates and that they were lost, stolen or destroyed before you receive any consideration for your shares. Upon request, our exchange agent, Computershare Limited, will send you instructions on how to provide evidence of ownership.

No Fractional Shares

Each holder of shares of common stock exchanged pursuant to the merger who would otherwise have been entitled to receive a fraction of a share of United Bankshares common stock shall receive, in lieu thereof, cash (without interest) in an amount, without any interest thereon, equal to the product of (i) the volume-weighted average closing price on Nasdaq of United Bankshares common stock for the 20 full trading days ending on the second trading day immediately preceding the date on which the merger is completed multiplied by (ii) the fraction of a share of United Bankshares common stock that such holder would otherwise be entitled to receive. A Community Bankers Trust shareholder whose direct shareholdings are represented by multiple Community Bankers Trust stock certificates will have all shares associated with those stock certificates aggregated for purposes of calculating whole shares and cash in lieu of fractional shares to be received upon completion of the merger.

Assumption of Community Bankers Trust Trust Preferred Securities

At the effective time of the merger, United Bankshares will expressly assume all of Community Bankers Trust’s obligations under the debentures issued by Community Bankers Trust to BOE Statutory Trust I and any trust preferred securities issued by Community Bankers Trust that are intended to be “qualified trust preferred securities” (as defined in applicable regulatory capital guidelines) or that are eligible for such treatment as grandfathered trust preferred securities. In connection therewith, to the extent applicable, as of the effective time of the merger, United Bankshares will be substituted for Community Bankers Trust on such indentures and trust preferred securities and will have executed any and all documents, instruments and agreements, including any supplemental indentures, guarantees or declarations of trust required by the aforementioned indentures or the trust preferred securities issued by BOE Statutory Trust I, or as may reasonably be requested by the trustees

 

77


Table of Contents

thereunder, and thereafter shall perform all of Community Bankers Trust’s obligations with respect to the trust preferred securities issued by BOE Statutory Trust I.

No Dissenters’ or Appraisal Rights

Shareholders will not have any dissenters’ or appraisal rights in connection with the merger and the other matters described in this prospectus and proxy statement.

Accounting Treatment

The merger will be accounted for using acquisition accounting, in accordance with GAAP. As such, the assets and liabilities of Community Bankers Trust, as of the completion of the merger, will be recorded at their fair values as well as any identifiable intangible assets. Any remaining excess purchase price will be allocated to goodwill, will not be amortized and will be evaluated for impairment annually. Consolidated financial statements of United Bankshares issued after the consummation of the merger will reflect such values. In addition, costs incurred in connection with the business combination will be expensed as incurred unless related to the equity issuance. The operating results of Community Bankers Trust will be included in United Bankshares’ consolidated financial statements from the date the merger is consummated and afterwards.

Management and Operations after the Merger; Advisory Board

The current directors and senior officers of United Bankshares are expected to continue in their current positions. Information about the current United Bankshares directors and executive officers can be found in the documents listed under “Where You Can Find More Information” beginning on page 99.

All of the current members of the Board of Directors of Community Bankers Trust will be invited to serve on the United Bank’s Richmond Advisory Board or another appropriate advisory board maintained by United Bankshares or United Bank for the region in which such individuals reside.

Resales of United Bankshares Common Stock

The shares of United Bankshares common stock to be issued to shareholders of Community Bankers Trust under the merger agreement have been registered under the Securities Act and may be freely traded without restriction by holders, including holders who were affiliates of Community Bankers Trust on the date of the special meeting (except for such holders who become affiliates of United Bankshares as of the effective time of the merger via their appointment to the board of directors of United Bankshares or otherwise). All directors and executive officers of Community Bankers Trust are considered affiliates of Community Bankers Trust for this purpose.

 

78


Table of Contents

MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCES OF THE MERGER

General

The following discussion and legal conclusions contained herein constitute and represent the opinion of Bowles Rice LLP, counsel to United Bankshares, and Williams Mullen, counsel to Community Bankers Trust, as to the material U.S. federal income tax consequences of the merger to “U.S. holders” of Community Bankers Trust common stock who exchange such stock for shares of United Bankshares common stock pursuant to the merger. This discussion is based upon the Code, existing and proposed Treasury Regulations, administrative pronouncements and judicial decisions, all as currently in effect as of the date hereof, and all of which are subject to change, possibly with retroactive effect. Such a change could affect the continuing validity of this summary. No assurance can be given that the IRS, would not assert, or that a court would not sustain, a position contrary to any of the tax consequences set forth below.

For purposes of this summary, a “U.S. holder” is a beneficial owner of Community Bankers Trust common stock that for U.S. federal income tax purposes is: (1) a citizen or resident of the United States; (2) a corporation, or an entity treated as a corporation, created or organized in or under the laws of the United States or any state or political subdivision thereof; (3) a trust (A) if (i) the administration thereof is subject to the primary supervision of a court within the United States, and (ii) one or more United States persons have the authority to control all substantial decisions of such trust or (B) that has a valid election in effect under applicable Treasury Regulations to be treated as a United States person; or (4) an estate that is subject to U.S. federal income tax on its income regardless of the source.

If a partnership (including for this purpose any entity treated as a partnership for U.S. federal income tax purposes) holds Community Bankers Trust common stock, the tax treatment of a partner generally will depend on the status of the partner and the activities of the partnership. If you are a partner of a partnership holding Community Bankers Trust common stock, you should consult your tax advisor.

The following summary addresses only those U.S. holders that hold their Community Bankers Trust common stock as a capital asset within the meaning of Section 1221 of the Code. It does not address all the tax consequences that may be relevant to particular shareholders in light of their individual circumstances or to shareholders that are subject to special rules, including, without limitation: financial institutions; tax-exempt organizations; S corporations, partnerships or other pass-through entities (or an investor in an S corporation, partnership or other pass-through entity); insurance companies; mutual funds; controlled foreign corporations or passive foreign investment companies; regulated investment companies; real estate investment trusts; dealers in stocks or securities, or foreign currencies; non-U.S. holders; a trader in securities who elects the mark-to-market method of accounting for the securities; persons that hold shares as a hedge against currency risk, a straddle or a constructive sale or conversion transaction; holders who acquired their shares pursuant to the exercise of employee stock options or otherwise as compensation or through a tax-qualified retirement plan; and holders of Community Bankers Trust stock options, stock warrants or debt instruments. In addition, the discussion does not address any alternative minimum tax or any state, local or foreign tax consequences of the merger, nor does it address any tax consequences arising under the unearned income Medicare contribution tax pursuant to the Health Care and Education Reconciliation Act of 2010.

The Merger

The merger will qualify as a reorganization within the meaning of Section 368(a) of the Code. Consummation of the merger is conditioned upon United Bankshares receiving an opinion from Bowles Rice LLP and upon Community Bankers Trust receiving an opinion from Williams Mullen, both to the effect that, based upon facts, representations and assumptions set forth in such opinions, the merger constitutes a reorganization within the meaning of Section 368(a) of the Code. The issuance of the opinions is conditioned on, among other things, such tax counsel’s receipt of representation letters from each of Community Bankers Trust

 

79


Table of Contents

or United Bankshares, in each case in form and substance reasonably satisfactory to such counsel, and on customary factual assumptions. Neither of these opinions of counsel is binding on the IRS or the courts and no ruling has been, or will be, sought from the IRS as to the U.S. federal income tax consequences of the merger. Accordingly, each Community Bankers Trust shareholder should consult its own tax advisor with respect to the particular tax consequences of the merger to such holder. If either Community Bankers Trust or United Bankshares waives the opinion condition after the registration statement of which this proxy statement and prospectus forms a part is declared effective by the SEC, and if the tax consequences of the merger to Community Bankers Trust and United Bankshares shareholders have materially changed, Community Bankers Trust and United Bankshares will recirculate appropriate soliciting materials to resolicit the votes of the Community Bankers Trust shareholders.

Consequences to Community Bankers Trust and United Bankshares

Each of Community Bankers Trust and United Bankshares will be a party to the merger within the meaning of Section  368(b) of the Code, and neither Community Bankers Trust nor United Bankshares will recognize any gain or loss as a result of the merger.

Consequences to Shareholders

Exchange of Community Bankers Trust Common Stock for United Bankshares Common Stock. U.S. holders of Community Bankers Trust common stock that exchange all of their Community Bankers Trust common stock solely for United Bankshares common stock will not recognize income, gain or loss for U.S. federal income tax purposes, except, as discussed below, with respect to cash received in lieu of fractional shares of United Bankshares common stock.

Cash in Lieu of Fractional Shares. U.S. holders of Community Bankers Trust common stock that receive cash in lieu of fractional shares of United Bankshares common stock in the merger generally will be treated as if the fractional shares of United Bankshares common stock had been distributed to them as part of the merger, and then redeemed by United Bankshares in exchange for the cash actually distributed in lieu of the fractional shares, with the redemption generally qualifying as an “exchange” under Section 302 of the Code. Consequently, those holders generally will recognize capital gain or loss with respect to the cash payments they receive in lieu of fractional shares measured by the difference between the amount of cash received and the holder’s adjusted tax basis allocable to the fractional shares, and will be long-term capital gain or loss if, as of the effective date of the merger, the holding period of such shares is greater than one year. The deductibility of capital losses is subject to limitations.

Basis in United Bankshares Common Stock. Each U.S. holder’s aggregate tax basis in United Bankshares common stock received in the merger will be equal to the U.S. holder’s aggregate adjusted tax basis in the Community Bankers Trust common stock exchanged in the merger, decreased by the amount of any tax basis allocable to any fractional share interest for which cash is received (described above). The holding period of United Bankshares common stock received by a U.S. holder in the merger will include the holding period of the Community Bankers Trust common stock exchanged in the merger if the Community Bankers Trust common stock exchanged is held as a capital asset at the time of the merger. If a U.S. holder acquired different blocks of Community Bankers Trust common stock at different times or at different prices, the United Bankshares common stock such holder receives will be allocated pro rata to each block of Community Bankers Trust common stock, and the basis and holding period of each block of United Bankshares common stock such holder receives will be determined on a block-for-block basis depending on the basis and holding period of the blocks of Community Bankers Trust common stock exchanged for such block of United Bankshares common stock.

Backup Withholding and Reporting Requirements

U.S. holders of Community Bankers Trust common stock, other than certain exempt recipients, may be subject to backup withholding at a rate of 24% with respect to any cash payment received in the merger in lieu of

 

80


Table of Contents

fractional shares. However, backup withholding will not apply to any U.S. holder that either (a) furnishes to United Bankshares a correct taxpayer identification number and certifies that it is not subject to backup withholding and United Bankshares and its exchange agent have not received notice to the contrary or (b) otherwise proves to United Bankshares and its exchange agent that the U.S. holder is exempt from backup withholding.

In addition, U.S. holders of Community Bankers Trust common stock are required to retain permanent records and make such records available to any authorized IRS officers and employees. The records should include the number of shares of Community Bankers Trust stock exchanged, the number of shares of United Bankshares stock received, the fair market value and tax basis of Community Bankers Trust shares exchanged and the U.S. holder’s tax basis in the United Bankshares common stock received.

If a U.S. holder of Community Bankers Trust common stock that exchanges such stock for United Bankshares common stock is a “significant holder” with respect to Community Bankers Trust, the U.S. holder is required to include a statement with respect to the exchange on or with the federal income tax return of the U.S. holder for the year of the exchange. A U.S. holder of Community Bankers Trust common stock will be treated as a significant holder in Community Bankers Trust if the U.S. holder’s ownership interest in Community Bankers Trust is five percent (5%) or more of Community Bankers Trust’s issued and outstanding common stock or if the U.S. holder’s basis in the shares of Community Bankers Trust stock exchanged is one million dollars ($1,000,000) or more. The statement must be prepared in accordance with Treasury Regulation Section 1.368-3 and must be entitled “STATEMENT PURSUANT TO §1.368-3(b) BY [INSERT NAME AND TAXPAYER IDENTIFICATION NUMBER (IF ANY) OF TAXPAYER], A SIGNIFICANT HOLDER”. The statement must include the names and employer identification numbers of Community Bankers Trust and United Bankshares, the date of the merger, and the fair market value and tax basis of Community Bankers Trust shares exchanged (determined immediately before the merger).

The discussion of material U.S. federal income tax consequences set forth above does not purport to be a complete analysis or listing of all potential tax effects that may apply to a holder of Community Bankers Trust common stock. We strongly encourage shareholders of Community Bankers Trust to consult their tax advisors to determine the particular tax consequences to them of the merger, including the application and effect of federal, state, local, foreign and other tax laws.

INFORMATION ABOUT UNITED BANKSHARES AND COMMUNITY BANKERS TRUST

United Bankshares

United Bankshares is a West Virginia corporation registered as a bank holding company pursuant to the BHCA. United Bankshares elected to be a financial holding company effective April 2, 2017. United Bankshares was incorporated on March 26, 1982, organized on September 9, 1982, and began conducting business on May 1, 1984 with the acquisition of three wholly-owned subsidiaries. Since its formation in 1982, United Bankshares has acquired 32 banking institutions. United Bankshares’ banking subsidiary, United Bank, a Virginia banking corporation, offers a full range of commercial and retail banking services and products. United Bankshares also owns nonbank subsidiaries that engage in other community banking services such as asset management, real property title insurance, investment banking, financial planning and brokerage services.

As a financial holding company, United Bankshares’ present business is community banking and mortgage banking. As of June 30, 2021, United Bankshares’ consolidated assets approximated $27.19 billion and total shareholders’ equity approximated $4.39 billion. At June 30, 2021, United Bankshares’ loan portfolio, net of unearned income, was $16.89 billion and its deposits were $21.57 billion.

The principal executive offices of United Bankshares are located in Charleston, West Virginia at 300 United Centre, 500 Virginia Street, East. The telephone number for United Bankshares’ principal executive offices is

 

81


Table of Contents

(304) 424-8800. United Bankshares’ website can be accessed at https://www.ubsi-inc.com. Information contained on the websites of United Bankshares or any subsidiary of United Bankshares does not constitute a part of this prospectus and proxy statement and is not incorporated into other filings that United Bankshares makes with the SEC. United Bankshares’ common stock is traded on Nasdaq under the symbol “UBSI”.

United Bankshares banking subsidiary, United Bank, operates a total of 203 full-service and limited service branch offices consisting of 67 branch offices in Virginia, including its main office, 48 branch offices in West Virginia, 44 branch offices in North Carolina, 25 branch offices in South Carolina, 7 branch offices in Maryland, 7 branch offices in the District of Columbia, 4 branch offices in Pennsylvania and 1 branch office in Ohio.

For more information regarding United Bankshares, please see United Bankshares’ Annual Report on Form 10-K for the year ended December 31, 2020, its quarterly report on Form 10-Q for the quarter ended June 30, 2021 and its proxy statement for its 2021 Annual Meeting of Shareholders, each of which are incorporated into this prospectus and proxy statement by reference.

Community Bankers Trust

Community Bankers Trust is a Virginia corporation registered as a bank holding company pursuant to the BHCA. Community Bankers Trust is the holding company for Essex Bank, a Virginia state commercial bank that was established in 1926.

Essex Bank engages in a general commercial banking business and provides a wide range of financial services primarily to individuals, small businesses and larger commercial companies, including individual and commercial demand and time deposit accounts, commercial and industrial loans, consumer and small business loans, real estate and mortgage loans, investment services, on-line and mobile banking products, and cash management services. Essex Services, Inc. is a wholly-owned subsidiary of Essex Bank. Essex Services and its financial consultants offer a broad range of investment products and alternatives through an affiliation with Infinex Investments, Inc., an independent broker-dealer. It also offers insurance products through Essex Bank’s ownership interest in Bankers Insurance, LLC, an independent insurance agency.

As of June 30, 2021, Community Bankers Trust’s consolidated assets approximated $1.75 billion and total shareholders’ equity approximated $179.7 million. At June 30, 2021, Community Bankers Trust’s loan portfolio, net of allowances for loan losses was approximately $1.20 billion and its deposits totaled approximately $1.49 billion.

Community Bankers Trust’s and Essex Bank’s executive offices and main branch are located at 9954 Mayland Drive, Richmond, Virginia 23233, and its telephone number is (703) 584-3400. Essex Bank operates a total of 24 branch locations consisting of 18 branch offices in Virginia, including its main office, and 6 branch offices in Maryland.

For more information regarding Community Bankers Trust, please see Community Bankers Trust’s Annual Report on Form 10-K for the year ended December 31, 2020, its quarterly report on Form 10-Q for the quarter ended June 30, 2021, and its proxy statement for its 2021 Annual Meeting of Shareholders, each of which are incorporated into this prospectus and proxy statement by reference.

DESCRIPTION OF UNITED BANKSHARES CAPITAL STOCK

General

The authorized capital stock of United Bankshares consists of 200,000,000 shares of common stock, par value $2.50 per share, and 50,000,000 shares of preferred stock, par value of $1.00 per share. United Bankshares

 

82


Table of Contents

has 134,165,180 shares of common stock issued (including 4,962,302 shares held as treasury shares) and no shares of preferred stock issued, each as of September 27, 2021. The outstanding shares are held by approximately 8,708 shareholders of record, as well as 39,312 shareholders in street name as of September 27, 2021. All outstanding shares of United Bankshares common stock are fully paid and nonassessable. The unissued portion of United Bankshares’ authorized common stock (subject to registration approval by the SEC) and the treasury shares are available for issuance as the board of directors of United Bankshares determines advisable.

On May 12, 2020, United Bankshares’ shareholders approved the 2020 Long-Term Incentive Plan, or the 2020 LTI Plan. The 2020 LTI Plan became effective May 13, 2020. An award granted under the 2020 LTI Plan may consist of any non-qualified stock options or incentive stock options, stock appreciation rights (“SARs”), restricted stock, restricted stock units, performance units or other-stock-based award. These awards all relate to the common stock of United Bankshares. The maximum number of shares of United Bankshares common stock which may be issued under the 2020 LTI Plan is 2,300,000. The 2020 LTI Plan will be administered by a board committee appointed by United Bankshares’ board of directors. Unless otherwise determined by the board, the compensation committee of the board shall administer the 2020 LTI Plan. The maximum number of options and stock appreciation rights, in the aggregate, which may be awarded to any individual key employee during any calendar year is 100,000. The maximum number of options and stock appreciation rights, in the aggregate, which may be awarded to any non-employee director during any calendar year is 10,000 or, if such award is payable in cash, the fair market value equivalent thereof. The maximum number of shares of restricted stock or shares subject to a restricted stock units award that may be granted during any calendar year is 225,000 shares to any individual key employee and 10,000 shares to any individual non-employee director. Subject to certain change in control provisions, the 2020 LTI Plan provides that all awards of will vest as the compensation committee determines in the award agreement, provided that no awards will vest sooner than 1/3 per year over the first three anniversaries of the award. United Bankshares adopted a clawback policy that applies to named executive officers and other executive officers and permits the compensation committee to cancel certain awards and to recoup gains realized from previous awards should United Bankshares be required to prepare an accounting restatement due to materially inaccurate performance metrics. A Form S-8 was filed on May 29, 2020 with the SEC to register all the shares which are available for issuance under the 2020 LTI Plan. As of September 27, 2021, the number of shares of United Bankshares common stock underlying awards issued under the 2020 LTI Plan that remain in effect are 330,484 shares.

The 2020 LTI Plan replaces the 2016 Long-Term Incentive Plan, or the 2016 LTI Plan, which expired on May 18, 2021. United Bankshares currently has options and restricted stock awards outstanding from the 2016 LTI Plan and various plans other than the 2020 LTI Plan, or the Prior Plans; however, no shares of United Bankshares common stock are available for grants under the Prior Plans as these plans have expired. Awards outstanding under the Prior Plans will remain in effect in accordance with their respective terms. The maximum term for options granted under the plans is 10 years. As of September 27, 2021, the number of shares of United Bankshares common stock underlying option awards and restricted stock awards issued under Prior Plans that remain in effect are 1,869,061 shares.

In October 2019, the United Bankshares board of directors approved a stock repurchase plan, whereby United Bankshares could buy up to 4,000,000 shares of its common stock in the open market. As of September 27, 2021, United Bankshares had repurchased 966,204 shares under the repurchase plan.

Common Stock

Voting Rights. United Bankshares has only one class of stock issued and outstanding and all voting rights are vested in the holders of United Bankshares common stock. On all matters subject to a vote of shareholders, the shareholders of United Bankshares will be entitled to one vote for each share of common stock owned. United Bankshares does not have a classified board of directors. Shareholders of United Bankshares have cumulative voting rights with regard to election of directors. At the present time, no senior securities of United Bankshares are outstanding, nor does the board of directors presently contemplate issuing senior securities.

 

83


Table of Contents

Dividend Rights. The shareholders of United Bankshares are entitled to receive dividends when and as declared by its board of directors. Dividends have been paid quarterly. Dividends were $1.05 for the first nine months of 2021, $1.40 per share in 2020, $1.37 per share in 2019 and $1.36 per share in 2018. The payment of dividends is subject to the restrictions set forth in the West Virginia Business Corporation Act and the limitations imposed by the Federal Reserve.

Payment of dividends by United Bankshares is dependent upon receipt of dividends from its banking subsidiaries. Payment of dividends by United Bankshares’ state member banking subsidiary is regulated by the West Virginia Business Corporation Act and the limitations imposed by the Federal Reserve and generally, the prior approval of the Federal Reserve is required if the total dividends declared by a state member bank in any calendar year exceeds its net profits, as defined, for that year combined with its retained net profits for the preceding two years. Additionally, prior approval of the Federal Reserve is required when a state member bank has deficit retained earnings but has sufficient current year’s net income, as defined, plus the retained net profits of the two preceding years. The Federal Reserve may prohibit dividends if it deems the payment to be an unsafe or unsound banking practice. The Federal Reserve has issued guidelines for dividend payments by state member banks emphasizing that proper dividend size depends on the bank’s earnings and capital.

Liquidation Rights. Upon any liquidation, dissolution or winding up of its affairs, the holders of United Bankshares common stock are entitled to receive pro rata all of the assets of United Bankshares for distribution to shareholders. There are no redemption or sinking fund provisions applicable to the common stock.

Assessment and Redemption. Shares of United Bankshares common stock presently outstanding are validly issued, fully paid and nonassessable. There is no provision for any voluntary redemption of United Bankshares common stock.

Transfer Agent and Registrar. The transfer agent and registrar for United Bankshares common stock is Computershare Limited.

Preferred Stock

On December 23, 2008, the shareholders of United Bankshares authorized the issuance of preferred stock up to 50,000,000 shares with a par value of $1.00 per share. The authorized preferred stock may be issued by the United Bankshares board of directors in one or more series, from time to time, with each such series to consist of such number of shares and to have such voting powers, full or limited, or no voting powers, and such designations, preferences and relative, participating, optional or other special rights, and the qualifications, limitations or restrictions thereof, as shall be stated in the resolution or resolutions providing for the issuance of such series adopted by the United Bankshares board of directors. Currently, no shares of preferred stock have been issued.

The authorization of preferred stock will not have an immediate effect on the holders of United Bankshares common stock. The actual effect of the issuance of any shares of preferred stock upon the rights of the holders of common stock cannot be stated until the United Bankshares board of directors determines the specific rights of any shares of preferred stock. However, the effects might include, among other things, restricting dividends on common stock, diluting the voting power of common stock, reducing the market price of common stock or impairing the liquidation rights of the common stock without further action by the shareholders. Holders of the common stock will not have preemptive rights with respect to the preferred stock.

Preemptive Rights

No holder of any share of the capital stock of United Bankshares has any preemptive right to subscribe to an additional issue of its capital stock or to any security convertible into such stock.

 

84


Table of Contents

Certain Provisions of the Bylaws

Indemnification and Limitations on Liability of Officers and Directors

As permitted by the West Virginia Business Corporation Act, the United Bankshares articles of incorporation contain provisions that indemnify its directors and officers to the fullest extent permitted by West Virginia law. These provisions do not limit or eliminate the rights of United Bankshares or any shareholder to seek an injunction or any other non-monetary relief in the event of a breach of a director’s or officer’s fiduciary duty. In addition, these provisions apply only to claims against a director or officer arising out of his or her role as a director or officer and do not relieve a director or officer from liability if he or she engaged in willful misconduct or a knowing violation of the criminal law or any federal or state securities law.

In addition, the United Bankshares articles of incorporation provide for the indemnification of both directors and officers for expenses that they incur in connection with the defense or settlement of claims asserted against them in their capacities as directors and officers. This right of indemnification extends to judgments or penalties assessed against them. United Bankshares has limited its exposure to liability for indemnification of directors and officers by purchasing directors and officers liability insurance coverage.

The rights of indemnification provided in the United Bankshares articles of incorporation are not exclusive of any other rights that may be available under any insurance or other agreement, by vote of shareholders or disinterested directors or otherwise.

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers or persons controlling United Bankshares pursuant to the foregoing provisions, United Bankshares has been informed that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.

Shares Eligible for Future Sale

All of the shares that will be exchanged for shares of United Bankshares common stock upon consummation of the merger will be freely tradable without restriction or registration under the Securities Act.

United Bankshares cannot predict the effect, if any, that future sales of shares of its common stock, or the availability of shares for future sales, will have on the market price prevailing from time to time. Sales of substantial amounts of shares of United Bankshares common stock, or the perception that such sales could occur, could adversely affect the prevailing market price of the shares.

 

85


Table of Contents

COMPARATIVE RIGHTS OF SHAREHOLDERS

The rights of United Bankshares shareholders are governed by the West Virginia Business Corporation Act. The rights of Community Bankers Trust shareholders are governed by the Virginia Stock Corporation Act. The rights of shareholders under both corporations are also governed by their respective articles of incorporation and bylaws. Following the merger, the rights of Community Bankers Trust shareholders that receive United Bankshares common stock will be governed by the articles and bylaws of United Bankshares. This summary does not purport to be a complete discussion of, and is qualified in its entirety by reference to, Community Bankers Trust’s articles of incorporation and bylaws, United Bankshares’ articles of incorporation and bylaws, Virginia law and West Virginia law.

Authorized Capital Stock

 

United Bankshares    Community Bankers Trust
200,000,000 shares of common stock, $2.50 par value per share and 50,000,000 shares of preferred stock, $1.00 par value per share.    200,000,000 shares of common stock, $0.01 par value per share and 5,000,000 shares of preferred stock, $0.01 par value per share.

Preemptive Rights

 

United Bankshares    Community Bankers Trust
The United Bankshares articles of incorporation provide that shareholders do not have preemptive rights to purchase, subscribe for, or take any part of any stock, whether unissued or treasury shares, or any part of the notes, debentures, bonds or other securities issued, optioned or sold by United Bankshares.    The articles of incorporation of Community Bankers Trust do not provide for preemptive rights to subscribe to or purchase any shares of any class of stock of Community Bankers Trust.

Size of Board of Directors

 

United Bankshares    Community Bankers Trust
United Bankshares’ bylaws provide that the board of directors shall consist of at least 5 and no more than 35 directors, provided that the number may be increased or decreased from time to time by an amendment to the bylaws, but no decrease shall have the effect of shortening the term of any incumbent director. The United Bankshares board of directors currently consists of 13 individuals, all of whom are elected annually.    Community Bankers Trust’s bylaws provide that the board of directors shall be as fixed in such manner as may be determined by the vote of a majority of the directors then in office, but shall not be less than one. The Community Bankers Trust board of directors currently consists of 10 individuals.

Cumulative Voting for Directors

Cumulative voting entitles each shareholder to cast an aggregate number of votes equal to the number of voting shares held, multiplied by the number of directors to be elected. Each shareholder may cast all of his or

 

86


Table of Contents

her votes for one nominee or distribute them among two or more nominees, thus permitting holders of less than a majority of the outstanding shares of voting stock to achieve board representation. Where cumulative voting is not permitted, holders of all outstanding shares of voting stock of a corporation elect the entire board of directors of the corporation.

 

United Bankshares    Community Bankers Trust
United Bankshares shareholders are allowed to cumulate their votes in the election of directors. Each share of United Bankshares stock may be voted for as many individuals as there are directors to be elected. Directors are elected by a plurality of the votes cast by the holders entitled to vote at the meeting.    Community Bankers Trust shareholders are not allowed to cumulate their votes in the election of directors. Directors are elected at any meeting of shareholders at which a quorum is present if the votes cast for such director exceed the votes cast against such director, provided, however, that directors shall be elected by a plurality of the votes cast by the holders entitled to vote at the meeting if the number of director nominees is greater than the number of directors to be elected.

Classes of Directors

 

United Bankshares    Community Bankers Trust
United Bankshares only has one class of directors.    Community Bankers Trust has three classes of directors, with directors serving staggered three-year terms.

Qualifications of Directors

 

United Bankshares    Community Bankers Trust
United Bankshares has retirement provisions based on age and minimum requirements for stock ownership for outside directors in its Corporate Governance Policy.   

Community Bankers Trust has retirement provisions based on age in its corporate governance guidelines.

Filling Vacancies on the Board

 

United Bankshares    Community Bankers Trust
United Bankshares’ bylaws provide that each vacancy existing on the board of directors and any directorship to be filled by reason of an increase in the number of directors, unless the articles of incorporation or bylaws provide that a vacancy shall be filled in some other manner, may be filled by the affirmative vote of a majority of the remaining directors at an annual, regular or special meeting of the board of directors. Any directorship to be filled by the board of directors by reason of a vacancy or an increase in the number of directors may be filled for a term of office continuing only until the next election of directors by the shareholders.    Community Bankers Trust’s articles of incorporation and bylaws provide that any vacancy in the board of directors, including vacancies resulting from any increase in the authorized number of directors may be filled by a vote of the remaining directors then in office, although less than a quorum, or by a sole remaining director and the directors so chosen shall hold office until the next annual meeting of shareholders and until their successors are duly elected and qualified, or until their earlier death, resignation or removal.

 

87


Table of Contents

Removal of Directors

 

United Bankshares    Community Bankers Trust
Under West Virginia law any member of the board may be removed, with or without cause, by the affirmative vote of a majority of all the votes entitled to be cast for the election of directors; provided, however, that a director may not be removed if the number of votes sufficient to elect the director under cumulative voting is voted against the director’s removal.    Community Bankers Trust’s bylaws provide that any director or the entire board of directors may be removed, with or without cause, by the holders of a majority of the shares entitled to vote at an election of directors. The notice calling such meeting shall state the intention to act upon such matter, and the vacancy or vacancies, if any, caused by such removal shall be filled at such meeting by a vote of the holders of a majority of the shares entitled to vote at an election of directors.

Notice of Shareholder Proposals and Director Nominations

 

United Bankshares    Community Bankers Trust
Shareholders may make a nomination for director provided that such nomination or nominations must be made in writing, signed by the shareholder and received by the Chairman or President of United Bankshares no later than 10 days from the date the notice on the meeting of shareholders was mailed; however, in the event the notice is mailed less than 13 days prior to the meeting, such nomination or nominations must be received no later than three days prior to any meeting of the shareholders wherein directors are to be elected. United Bankshares’ bylaws do not address shareholder proposals except with regard to the nomination of directors.    Community Bankers Trust’s bylaws provide that any shareholder may propose business to be considered at the annual meeting of shareholders, or nominate an individual for election to the board, only if written notice of such proposed business or nomination has been given to, and received by, the Secretary of Community Bankers Trust not less than 60 nor more than 90 days prior to the date of the scheduled annual meeting; provided, however, in the event that less than 70 days’ notice or prior public disclosure of the date of the meeting is given or made, notice by the shareholder must be so received not later than the close of business on the 10th day following the earlier of the day on which such notice of the date of the meeting was mailed or the day on which such public disclosure was made. If proposing business, the shareholder’s written notice must include, (a) as to each matter the shareholder proposes to bring before the annual meeting (i) a brief description of the business desired to be brought before the annual meeting and the reasons for conducting such business at the annual meeting, and (ii) any material interest of the shareholder in such business, and (b) as to the shareholder giving the notice (i) the name and record address of the shareholder and (ii) the class, series and number of shares of capital stock of Community Bankers Trust which are beneficially owned by the shareholder. If nominating a director, the shareholder’s written notice must include, (a) the name, age, business address and residence address of the person, (b) the principal occupation or employment of the person, (c) the class and number

 

88


Table of Contents
   of shares of capital stock of Community Bankers Trust which are beneficially owned by the person, and (d) any other information relating to the person that is required to be disclosed in solicitations for proxies for election of directors pursuant to the rules and regulations of the SEC under Section 14 of the Exchange Act, as amended. As to the shareholder giving the notice (a) the name and record address of the shareholder and (b) the class and number of shares of capital stock of Community Bankers Trust which are beneficially owned by the shareholder must be included.

Anti-Takeover Provisions – Business Combinations

 

United Bankshares    Community Bankers Trust
United Bankshares’ articles of incorporation and bylaws do not contain any anti-takeover provisions. In addition, West Virginia corporate law does not contain statutory provisions concerning restrictions on business combinations.    Community Bankers Trust’s articles of incorporation and bylaws do not contain any anti-takeover provisions. Under Virginia law, there are statutory provisions concerning “affiliated transactions” and “control share acquisitions,” neither of which is applicable to the transactions contemplated by the merger.

Shareholder Action Without a Meeting

West Virginia law provides that action required or permitted by law to be taken at a shareholders’ meeting may be taken without a meeting and without prior notice, if a written consent which describes the action is signed by all of the shareholders entitled to vote on the matter and is filed with the records of the shareholder meeting.

Unless otherwise set forth in the corporation’s articles of incorporation, Virginia law provides that action required or permitted by law to be adopted or taken at a shareholders’ meeting may be adopted or taken without a meeting and if the action is adopted or taken by all shareholders entitled to vote on the action, and any such written consent shall be signed by all shareholders entitled to vote on the action, bear the date of each signature and delivered for inclusion with the minutes or corporate records of the corporation.

 

United Bankshares    Community Bankers Trust
United Bankshares’ articles of incorporation and bylaws are silent as to shareholder action without a meeting. Accordingly, West Virginia law would govern.    Community Bankers Trust’s bylaws provide that any action required to be taken at any annual or special meeting of shareholders, or any action which may be taken at any annual or special meeting of such shareholders, may be taken without a meeting, without prior notice and without a vote, if a consent in writing, setting forth the action so taken, is signed by the holders of outstanding stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted.

 

89


Table of Contents

Calling Annual Meetings of Shareholders

 

United Bankshares    Community Bankers Trust
The annual meeting of the shareholders of United Bankshares shall be held on the third Monday in May of each calendar year or on such other date as may be designated in the notice and call of such meeting, at the principal office of United Bankshares, or at such other place either within or without the State of West Virginia as the board of directors shall, from time to time, determine, and the place and the hour at which such meeting shall be held shall be stated in the notice and call of such meeting.    The annual meeting of shareholders for the election of directors and for the transaction of whatever other business may properly come before the meeting, shall be held at such date, time and place, either within or without the Commonwealth of Virginia, as may be designated from time to time by the Board of Directors and stated in the notice of the meeting

Notice of Meetings

 

United Bankshares    Community Bankers Trust
United Bankshares’ bylaws require that the notice of annual and special meetings be given by mailing to each shareholder a written notice specifying the time and place of such meeting, and, in the case of special meetings, the business to be transacted. The notice must be mailed to the last addresses of the shareholders as they respectively appear upon the books of United Bankshares, and in the case of annual meetings, not less than 10 days, and in the case of special meetings, not less than 5 days, before the date of such meeting.    Notice of any annual or special meeting of Community Bankers Trust shareholders must be mailed postage prepaid, at least 10 days prior to but not more than 60 days prior to the date thereof, addressed to each shareholder at his or her address appearing on the books of Community Bankers Trust unless notice is waived by unanimous consent of all shareholders. However, Virginia law requires that for a meeting of shareholders to act on an amendment to the articles of incorporation, a plan of merger, a share exchange or certain other extraordinary measures specified by Virginia law, notice must be given at least 25 days prior to, but not more than 60 days prior to, the meeting.

Vote Required for Amendments to Articles of Incorporation and Certain Transactions

West Virginia law and Virginia law provide that on matters other than the election of directors and certain extraordinary corporate actions, if a quorum is present, then action on a matter is approved if the votes cast favoring the action exceed the votes cast opposing the action, unless the vote of a greater number is required by law or the articles of incorporation or bylaws. The articles of incorporation or bylaws of United Bankshares and Community Bankers Trust do not require a greater number. An abstention is not considered a “vote cast” for purposes of the voting requirements, but a shareholder who abstains in person or by proxy is considered present for purposes of the quorum requirement.

 

United Bankshares    Community Bankers Trust
Under West Virginia law, the United Bankshares articles of incorporation may be amended by the affirmative vote of a majority of all votes of shareholders entitled to be cast on the matter, unless a    Under Virginia law, any amendments to a corporation’s articles of incorporation must be approved by a majority of each voting group entitled to vote on the amendment by more than two-thirds of

 

90


Table of Contents

different number is specified in the articles of incorporation or required by the board of directors. The United Bankshares articles of incorporation do not specify a different number.

 

Under West Virginia law, a consolidation, merger, share exchange or transfer must be approved by the shareholders of the corporation at a meeting at which a quorum exists consisting of at least a majority of the votes entitled to be cast on the matter. The United Bankshares articles of incorporation do not provide for a different number.

  

all the votes entitled to be cast by that voting group. The articles of incorporation may provide for a greater or lesser vote or a vote by separate voting groups so long as the vote provided for is not less than a majority of all the votes cast on the amendment by each voting group entitled to vote on the amendment at a meeting at which a quorum of the voting group exists.

 

Community Bankers Trust’s amended and restated articles of incorporation are silent as to voting required for amendments, therefore the two-thirds requirement outlined above is necessary for any amendment to the articles of incorporation.

   Community Bankers Trust’s articles of incorporation provide that the directors in their discretion may submit any contract or act for approval or ratification at any annual meeting of the shareholders or at any meeting of the shareholders called for the purpose of considering any such act or contract, and any contract or act that shall be approved or be ratified by the vote of the holders of a majority of the stock of Community Bankers Trust which is represented in person or by proxy at such meeting and entitled to vote thereat (provided that a lawful quorum of shareholders be there represented in person or by proxy). Any contract or act would include a consolidation, merger, share exchange or transfer.

Amendment of Bylaws

 

United Bankshares    Community Bankers Trust

Under West Virginia law, the United Bankshares bylaws may be amended by the affirmative vote of a majority of all votes of shareholders entitled to be cast on the matter, unless a different number is specified in the articles of incorporation or required by the board of directors. The United Bankshares articles of incorporation do not specify a different number.

 

Under West Virginia law and United Bankshares’ bylaws, both the board of directors and shareholders have the power to amend the bylaws.

   Community Bankers Trust’s bylaws may be amended or repealed at any meeting of the board of directors, by a vote of a majority of the total number of directors present at the meeting at which there is a quorum, or at any special or annual meeting of shareholders, by a vote of a majority of the shares of Community Bankers Trust’s capital stock issued, outstanding and entitled to vote, so represented in person or by proxy at the meeting if there is a quorum.

 

91


Table of Contents

Appraisal Rights

 

United Bankshares    Community Bankers Trust

Under West Virginia law, shareholders are generally entitled to object and receive payment of the fair value of their stock in the event of any of the following corporate actions: merger, transfer of all or substantially all of the corporation’s assets, participation in a share exchange as the corporation the stock of which is to be acquired, or an amendment to the articles of incorporation that reduces the number of shares of a class or series owned by shareholders to a fraction of a share if the corporation has the obligation or right to repurchase the fractional shares. However, appraisal rights are not available to shareholders in the event of one of the foregoing corporate actions if the stock is (i) listed on the New York Stock Exchange or designated as a national market system security on an interdealer quotation system by the National Association of Securities Dealers, Inc. or (ii) held by 2,000 or more shareholders and the outstanding shares of stock, excluding shares held by affiliates or shareholders holding more than 10% of the outstanding shares, have an aggregate market value of $20 million or more.

 

Appraisal rights will not be available to the shareholders of United Bankshares in connection with the proposed merger of Community Bankers Trust into United Bankshares because the stock of United Bankshares is designated as a national market system security on an interdealer quotation system by the National Association of Securities Dealers, Inc.

  

Under Virginia law, shareholders are generally entitled to object and receive payment of the fair value of their stock in the event of any of the following corporate actions: merger, transfer of all or substantially all of the corporation’s assets, participation in a share exchange as the corporation the stock of which is to be acquired, or an amendment to the articles of incorporation that reduces the number of shares of a class or series owned by shareholders to a fraction of a share if the corporation has the obligation or right to repurchase the fractional shares. However, appraisal rights are not available to shareholders in the event of one of the foregoing corporate actions if the stock is traded in an organized market or the company has more than 2,000 shareholders.

 

Appraisal rights will not be available to the shareholders of Community Bankers Trust in connection with the proposed merger because the stock of Community Bankers Trust is listed on Nasdaq.

Dividends

 

United Bankshares    Community Bankers Trust
A West Virginia corporation generally may pay dividends in cash, property or its own shares except when the corporation is unable to pay its debts as they become due in the usual course of business or the corporation’s total assets would be less than the sum of its total liabilities plus the amount that would be needed, if the corporation were to be dissolved at the time of the dividend, to satisfy any shareholders who have rights superior to those receiving the dividend.    A Virginia corporation generally may pay dividends in cash, property or its own shares except when the corporation is unable to pay its debts as they become due in the usual course of business or the corporation’s total assets would be less than the sum of its total liabilities plus the amount that would be needed, if the corporation were to be dissolved at the time of the dividend, to satisfy any shareholders who have rights superior to those receiving the dividend. In addition, as is true for Community Bankers Trust, other restrictions may apply under laws and regulations affecting bank holding companies, including the responsibility to maintain adequate capital in its banking subsidiary.

 

92


Table of Contents

Discharge of Duties; Exculpation and Indemnification

West Virginia law requires that a director of a West Virginia corporation discharge duties as a director in good faith, in a manner reasonably believed to be in the best interest of the corporation and with the care that a person in a like position would reasonably believe appropriate under similar circumstances.

Virginia law requires that a director of a Virginia corporation discharge duties as a director in accordance with his or her good faith business judgment of the best interests of the corporation.

 

United Bankshares    Community Bankers Trust
United Bankshares’ articles of incorporation provide that each director or officer of United Bankshares shall be indemnified for costs and expenses arising out of any criminal or civil suit or proceeding against the director or officer by reason of being a director or officer of United Bankshares. However, a director or officer shall not be indemnified if he or she is adjudged in such suit or proceeding to be liable for gross negligence or willful misconduct in performance of a duty owed to the corporation.    Community Bankers Trust’s articles of incorporation provide that a director or officer of Community Bankers Trust shall not be liable to Community Bankers Trust or its shareholders for monetary damages, except for liability resulting from such person having engaged in willful misconduct or a knowing violation of the criminal law or any federal or state securities law. Community Bankers Trust’s articles of incorporation provide that the corporation shall indemnify (a) any person who was or is a party to any proceeding, including a proceeding brought by a shareholder in the right of the corporation or brought by or on behalf of shareholders of the corporation, by reason of the fact that he or she is or was a director or officer of the corporation, or (b) any director or officer who is or was serving at the request of the corporation as a director, trustee, partner or officer of another corporation, partnership, joint venture, trust, employee benefit plan or other enterprise, against any liability incurred by him or her in connection with such proceeding unless he or she engaged in willful misconduct or a knowing violation of the criminal law. The directors, by majority vote of a quorum consisting of disinterested directors, may cause the corporation to indemnify or contract to indemnify any person who was, is or may become a party to any proceeding, by reason of the fact that he or she is or was an employee or agent of the corporation, or is or was serving at the request of the corporation as director, officer or employee or agent of another corporation, partnership, joint venture, trust, employee benefit plan or other enterprise.

 

93


Table of Contents

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT OF

UNITED BANKSHARES

The following table sets forth certain information as of September 27, 2021, concerning the number and percentage of shares of United Bankshares common stock beneficially owned by each of United Bankshares’ directors and named executive officers and by United Bankshares’ directors and executive officers as a group. In addition, the table includes information with respect to persons known to United Bankshares who own or may be deemed to own more than 5% of United Bankshares common stock as of September 27, 2021. Beneficial ownership includes shares, if any, held in the name of the spouse, minor children or other relatives of the individual living in such person’s home, as well as shares, if any, held in the name of another person under an arrangement whereby the director, or executive officer can vest title in himself or herself at once or at some future time. Except as otherwise indicated, all shares are owned directly, the named person possesses sole voting and sole investment power with respect to all such shares, and none of such shares are pledged as security.

 

     Number of Shares
Beneficially Owned (2)
    Percentage of Class
Beneficially Owned
 

5% Shareholders:

    

BlackRock, Inc.

55 East 52nd Street, New York, NY 10055

     16,623,013 (3)      12.87

The Vanguard Group

100 Vanguard Blvd., Malvern, PA 19355

     12,032,542 (4)      9.31

State Street Corporation

One Lincoln Street, Boston, MA 02111

     9,280,760  (5)      7.18

Directors:

    

Richard M. Adams(1)

     1,131,740       *  

Charles L. Capito, Jr.

     6,009       *  

Peter A. Converse

     434,302       *  

Michael P. Fitzgerald

     207,813       *  

Theodore J. Georgelas

     53,571       *  

Patrice A. Harris, MD, MA, FAPA

     5,054       *  

J. Paul McNamara

     80,485       *  

Mark R. Nesselroad

     70,158       *  

Jerold L. Rexroad

     148,280       *  

Albert H. Small, Jr.

     9,660       *  

Mary K. Weddle

     16,963       *  

Gary G. White

     33,984       *  

P. Clinton Winter

     521,802       *  

Named Executive Officers:

    

Richard M. Adams, Jr.

     196,448       *  

James J. Consagra, Jr.

     171,212       *  

W. Mark Tatterson

     126,362       *  

Darren K. Williams

     60,709       *  

Directors and Executive Officers as a group (18 persons):

     5,993,682       4.64

 

*

Percentage of ownership is less than one percent of the outstanding shares of United Bankshares common stock.

 

94


Table of Contents

Footnotes:

 

  (1)

Richard M. Adams is also a Named Executive Officer.

 

  (2)

Amounts reflect shares of common stock that could be acquired through the exercise of stock options within 60 days after September 27, 2021. Amounts also Include stock held by United Bank’s Trust Department which shares beneficial ownership as described in this footnote. The following directors each exercise voting authority over the number of shares indicated as follows: Ms. Weddle, 7,787 shares and Mr. Winter, 33,563 shares. United Bank’s Board of Directors exercises voting authority over 2,653,086 shares held by United Bank’s Trust Department. All of these shares are included in the 5,993,682 shares held by all directors and executive officers as a group. Also includes shares pledged as collateral as follows: Mr. Converse, 100,000 shares; Mr. Georgelas, 44,428 shares; and Mr. Winter, 112,412 shares.

 

  (3)

BlackRock, Inc., or BlackRock, is a global investment management firm that serves institutional and retail clients, including pension funds, foundations, endowments, official institutions, insurance companies, subadvisory relationships, high net worth individuals, family offices and private banks. BlackRock beneficially owns 16,623,013 or 12.87% of United Bankshares’ common stock. BlackRock holds sole dispositive authority for the 16,623,013 shares and sole voting authority over 16,379,199 shares. BlackRock’s address and holdings are based solely on a Schedule 13G filing with the Securities and Exchange Commission dated January 26, 2021 made by BlackRock setting forth information as of December 31, 2020. The Percentage of Class Beneficially owned is based on United Bankshares’ 129,202,878 issued and outstanding shares as of September 27, 2021.

 

  (4)

The Vanguard Group, or Vanguard, is one of the world’s largest investment management companies, serving individual investors, institutions, employer-sponsored retirement plans, and financial professionals. Vanguard beneficially owns 12,032,542 or 9.31% of United Bankshares’ common stock. Of these beneficially-owned shares, Vanguard holds shared voting authority over 125,219 shares, sole dispositive authority over 11,800,633 shares, and shared dispositive authority over 231,909 shares. Vanguard’s address and holdings are based solely on a Schedule 13G filing with the Securities and Exchange Commission dated February 8, 2021 made by Vanguard setting forth information as of December 31, 2020. The Percentage of Class Beneficially owned is based on United Bankshares’ 129,202,878 issued and outstanding shares as of September 27, 2021.

 

  (5)

State Street Corporation. or State Street, is a global financial services provider that offers a flexible suite of services that spans the investment spectrum, including investment management, research and trading, and investment servicing. State Street beneficially owns 9,280,760 or 7.18% of United Bankshares’ common stock. State Street holds shared dispositive authority for the 9,280,760 shares and shared voting authority over 8,773,805 shares. State Street’s address and holdings are based solely on a Schedule 13G filing with the Securities and Exchange Commission dated February 11, 2021 made by State Street setting forth information as of December 31, 2020. The Percentage of Class Beneficially owned is based on United Bankshares’ 129,202,878 issued and outstanding shares as of September 27, 2021.

 

95


Table of Contents

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT OF COMMUNITY BANKERS TRUST

The following table sets forth certain information as of September 27, 2021, concerning the number and percentage of shares of Community Bankers Trust common stock beneficially owned by each of Community Bankers Trust’s directors and named executive officers and by Community Bankers Trust’s directors and executive officers as a group. No persons known to Community Bankers Trust own or may be deemed to own more than 5% of Community Bankers Trust common stock. Beneficial ownership includes shares, if any, held in the name of the spouse, minor children or other relatives of the individual living in such person’s home, as well as shares, if any, held in the name of another person under an arrangement whereby the director, or executive officer can vest title in himself or herself at once or at some future time. Except as otherwise indicated, the named person possesses sole voting and sole investment power with respect to all such shares, and none of such shares are pledged as security.

 

     Number of
Shares of
Common
Stock
Beneficially
Owned (2)
     Exercisable
Options for
Common Stock
     Percentage of
Class
Beneficially
Owned
 

Directors:

        

Gerald F. Barber

     38,094        —         

Hugh M. Fain, III

     16,242        —         

William E. Hardy

     45,653        —         

Ira C. Harris

     3,945        —         

Gail L. Letts

     7,151        —         

Eugene S. Putnam, Jr.

     115,041        —         

S. Waite Rawls III

     58,062        —         

Rex L. Smith, III (1)

     128,653        255,000       

Oliver L. Way

     32,988        —         

Robin Traywick Williams

     88,690        —         

Named Executive Officers:

        

Bruce E. Thomas

     17,037        81,250       

Jeff R. Cantrell

     30,875        72,500       

John M. Oakey, III

     25,475        141,250       

Current Directors and Executive Officers as a Group (16 persons)

     623,633        702,500        5.72

 

*

Percentage of ownership is less than one percent of the outstanding shares of Community Bankers Trust common stock.

(1)

Rex L. Smith, III is also a Named Executive Officer.

(2)

Amounts reflect whole numbers of shares only. Certain directors and executive officers own a fractional share of common stock as a result of automatic dividend reinvestments. Amounts also include the following shares of common stock that the individual owns directly or indirectly through affiliated corporations, close relatives and dependent children or as custodians or trustees: Barber, 6,347 shares; Letts, 149 shares; Putnam, 3,200 shares; and Williams, 4,260 shares.

(3)

Amounts reflect shares of common stock that could be acquired through the exercise of stock options within 60 days after September 27, 2021.

 

96


Table of Contents

LEGAL MATTERS

Williams Mullen and Bowles Rice LLP will opine as to the qualification of the merger as a reorganization within the meaning of Section 368(a) of the Code. Bowles Rice LLP will opine as to the legality of the common stock of United Bankshares offered by this prospectus and proxy statement.

EXPERTS

The consolidated financial statements of United Bankshares appearing in United Bankshares’ Annual Report (Form 10-K) for the year ended December 31, 2020, and the effectiveness of United Bankshares’ internal control over financial reporting as of December 31, 2020, have been audited by Ernst & Young LLP, independent registered public accounting firm, as set forth in their reports thereon, included therein, and incorporated herein by reference. Such consolidated financial statements are incorporated herein by reference in reliance upon such reports given on the authority of such firm as experts in accounting and auditing.

The consolidated financial statements of Community Bankers Trust appearing in Community Bankers Trust’s Annual Report on Form 10-K for the year ended December 31, 2020, have been audited by Yount, Hyde, & Barbour. P.C., independent registered public accounting firm, as set forth in their reports thereon, included therein, and incorporated herein by reference. Such consolidated financial statements are incorporated herein by reference in reliance upon such reports given on the authority of such firm as experts in accounting and auditing.

COMMUNITY BANKERS TRUST ANNUAL MEETING SHAREHOLDER PROPOSALS

If the merger is completed, Community Bankers Trust will not have public shareholders and there will be no public participation in any future meeting of shareholders. However, if the merger is not completed or if Community Bankers Trust is otherwise required to do so under applicable law, Community Bankers Trust will hold a 2022 annual meeting of shareholders. Any nominations for directors or proposals for other business intended to be presented at Community Bankers Trust’s next annual meeting must be submitted to Community Bankers Trust as set forth below.

All proposals, including nominations for directors, submitted by shareholders for presentation in the proxy statement for the 2022 annual meeting of shareholders must comply with the SEC’s rules regarding shareholder proposals. In addition, the Community Bankers Trust’s Bylaws require that for any business to be properly brought before an annual meeting by a shareholder, the Community Bankers Trust’s Secretary must have received written notice thereof not less than 60 nor more than 90 days prior to the meeting (or not later than 10 days after a notice or public disclosure of such meeting date if such disclosure occurs less than 70 days prior to the date of the meeting). The notice must set forth:

 

   

for nominations for directors, as to each person whom the shareholder proposes to nominate for election as a director

 

   

the name, age, business address and residence address of the person;

 

   

the principal occupation or employment of the person;

 

   

the class and number of shares of capital stock of the Community Bankers Trust that are beneficially owned by the person; and

 

   

any other information relating to the person that is required to be disclosed in solicitations for proxies for election of directors pursuant to the rules and regulations of the SEC; and

 

97


Table of Contents
   

for other business, as to each matter the shareholder proposes to bring before the annual meeting

 

   

a brief description of the business desired to be brought before the annual meeting and the reasons for conducting such business at the annual meeting; and

 

   

any material interest of the shareholder in such business; and

 

   

as to the shareholder giving the notice

 

   

the name and record address of the shareholder; and

 

   

the class, series and number of shares of capital stock of the Community Bankers Trust that are beneficially owned by the shareholder.

The proxies will have discretionary authority to vote on any matter that properly comes before the meeting if the shareholder has not provided timely written notice as required by the Community Bankers Trust Bylaws.

Any proposal of a shareholder intended to be presented at the Community Bankers Trust’s 2022 annual meeting of shareholders and included in the proxy statement and form of proxy for that meeting must be received by the Corporate Secretary of Community Bankers Trust no later than December 20, 2021.

 

98


Table of Contents

WHERE YOU CAN FIND MORE INFORMATION

United Bankshares filed with the SEC under the Securities Act the registration statement on Form S-4 to register the shares of United Bankshares common stock to be issued to Community Bankers Trust shareholders in connection with the merger. The registration statement, including the exhibits and schedules thereto, contains additional relevant information about United Bankshares and its common stock. The rules and regulations of the SEC allow United Bankshares to omit certain information included in the registration statement from this prospectus and proxy statement. This prospectus and proxy statement is part of the registration statement and is a prospectus of United Bankshares in addition to being Community Bankers Trust’s proxy statement for its special meeting.

Both United Bankshares (File No. 002-86947) and Community Bankers Trust (File No. 01-32590) file reports, proxy statements and other information with the SEC under the Exchange Act. The SEC maintains a website at http://www.sec.gov where you can access reports, proxy information and registration statements, and other information regarding registrants that file electronically with the SEC. United Bankshares and Community Bankers Trust also post their SEC filings on their respective websites. The website addresses are www.ubsi-inc.com and www.cbtrustcorp.com, respectively. Information contained on the United Bankshares website or the Community Bankers Trust website is not incorporated by reference into this prospectus and proxy statement, and you should not consider information contained in its website as part of this prospectus and proxy statement.

The SEC allows United Bankshares and Community Bankers Trust to “incorporate by reference” information into this prospectus and proxy statement. This means that we can disclose important information to you by referring you to another document filed separately by United Bankshares and Community Bankers Trust with the SEC. The information incorporated by reference is considered to be a part of this prospectus and proxy statement, except for any information that is superseded by information that is included directly in this prospectus and proxy statement or by information contained in documents filed with or furnished to the SEC after the date of this prospectus and proxy statement.

This prospectus and proxy statement incorporates by reference the documents listed below that United Bankshares has previously filed with the SEC, other than, in each case, documents or information deemed to have been furnished and not filed according to the SEC rules:

 

•  Annual Report on Form 10-K

   Year ended December 31, 2020.

•  Quarterly Reports on Form 10-Q

   Filed on May  10, 2021 and August 9, 2021.

•  Proxy Statement on Schedule 14A for the 2021 annual meeting of United Bankshares Shareholders

   Filed on March 30, 2021.

•  Current Reports on Form 8-K

   Filed on February  26, 2021, May  17, 2021 and June 3, 2021.

•  The description of United Bankshares common stock set forth in United Bankshares’ registration statement on Form 8-A filed pursuant to Section 12 of the Exchange Act and any amendment or report filed for the purpose of updating those descriptions

   Filed on May 1, 1984.

 

99


Table of Contents

This prospectus and proxy statement incorporates by reference the documents listed below that Community Bankers Trust has previously filed with the SEC, other than, in each case, documents or information deemed to have been furnished and not filed according to the SEC rules:

 

•  Annual Report on Form 10-K

  

Year ended December 31, 2020.

•  Quarterly Reports on Form 10-Q

  

Filed on May 14, 2021 and August 13, 2021.

•  Proxy Statement on Schedule 14A for the 2021 annual meeting of Community Bankers Trust

   Filed on April 23, 2021.

•  Current Reports on Form 8-K

   Filed on March 25, 2021 (Amendment No.  1), March  25, 2021,
May  27, 2021
, June  3, 2021 and July 30, 2021 (Item 8.01 only).

United Bankshares and Community Bankers Trust also incorporate by reference additional documents that may be filed under Sections 13(a) and 15(d) of the Exchange Act with the SEC between the date of this prospectus and proxy statement and the date of Community Bankers Trust’s special meeting of shareholders or the termination of the merger agreement. These include periodic reports such as Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K.

You can obtain additional copies of the documents incorporated by reference in this prospectus and proxy statement free of charge by requesting them in writing or by telephone from the following address:

 

United Bankshares, Inc.

514 Market Street

Parkersburg, West Virginia 26102

Attention: Shelli Adams

Telephone: (304) 424-8800

  

Community Bankers Trust Corporation

9954 Mayland Drive, Suite 2100

Richmond, Virginia 23233

Attention: John M. Oakey, III

Telephone: (804) 934-9999

If you would like to request any documents, please do so by November 9, 2021, in order to receive them before the Community Bankers Trust shareholder meeting.

Neither United Bankshares nor Community Bankers Trust has authorized anyone to give any information or make any representation about the merger or the companies that is different from, or in addition to, that contained in this prospectus and proxy statement or in any of the materials that we have incorporated into this prospectus and proxy statement. United Bankshares or Community Bankers Trust take no responsibility for, and provide no assurances as to the reliability of, any other information that others may give you. Information in this prospectus and proxy statement about United Bankshares has been supplied by United Bankshares and information about Community Bankers Trust has been supplied by Community Bankers Trust. The information contained in this prospectus and proxy statement speaks only as of the date of this prospectus and proxy statement unless the information specifically indicates that another date applies.

The representations, warranties and covenants described in this document and included in the merger agreement were made only for purposes of the merger agreement and as of specific dates, are solely for the benefit of United Bankshares and Community Bankers Trust, may be subject to limitations, qualifications or exceptions agreed upon by the parties, including those included in confidential disclosures made for the purposes of, among other things, allocating contractual risk between United Bankshares and Community Bankers Trust rather than establishing matters as facts, and may be subject to standards of materiality that differ from those standards relevant to investors. You should not rely on the representations, warranties or covenants or any description thereof as characterizations of the actual state of facts or condition of United Bankshares, Community

 

100


Table of Contents

Bankers Trust or any of their respective subsidiaries or affiliates. Moreover, information concerning the subject matter of the representations, warranties and covenants may change after the date of the merger agreement, which subsequent information may or may not be fully reflected in public disclosures by United Bankshares or Community Bankers Trust. The representations and warranties and other provisions of the merger agreement should not be read alone, but instead should be read only in conjunction with the information provided elsewhere in this prospectus and proxy statement and in the documents incorporated by reference into this prospectus and proxy statement. See “Where You Can Find More Information” on page 99.

 

101


Table of Contents

Appendix A

Execution Version

 

AGREEMENT AND PLAN OF REORGANIZATION

dated as of June 2, 2021

by and between

UNITED BANKSHARES, INC.

and

COMMUNITY BANKERS TRUST CORPORATION

 


Table of Contents

Table of Contents

 

         Page  

ARTICLE I

  Certain Definitions      A-1  

1.01

  Certain Definitions      A-1  

ARTICLE II

  The Merger      A-7  

2.01

  The Merger      A-7  

2.02

  Effective Date and Effective Time      A-8  

2.03

  Tax Consequences      A-8  

ARTICLE III

  The Bank Merger      A-8  

3.01

  The Bank Merger      A-8  

3.02

  Effective Date and Effective Time      A-8  

ARTICLE IV

  Consideration; Exchange Procedures      A-9  

4.01

  Merger Consideration      A-9  

4.02

  Rights as Shareholders; Stock Transfers      A-9  

4.03

  Fractional Shares      A-9  

4.04

  Exchange Procedures      A-9  

4.05

  Anti-Dilution Provisions      A-10  

4.06

  Equity-Based Awards      A-10  

4.07

  Withholding Rights      A-11  

ARTICLE V

  Actions Pending the Effective Time      A-11  

5.01

  Forbearances of CBTC      A-11  

5.02

  Forbearances of United      A-13  

ARTICLE VI

  Representations and Warranties      A-14  

6.01

  Disclosure Schedules      A-14  

6.02

  Standard      A-14  

6.03

  Representations and Warranties of CBTC      A-14  

6.04

  Representations and Warranties of United      A-25  

ARTICLE VII

  Covenants      A-32  

7.01

  Reasonable Best Efforts      A-32  

7.02

  Shareholder Approval      A-32  

7.03

  Registration Statement      A-32  

7.04

  Access; Information      A-33  

7.05

  Acquisition Proposals      A-34  

7.06

  Takeover Laws      A-35  

7.07

  Exemption from Liability Under Section 16(b)      A-35  

7.08

  Regulatory Applications      A-35  

7.09

  Indemnification      A-36  

7.10

  Benefit Plans      A-37  

7.11

  Notification of Certain Matters      A-38  

7.12

  Advisory Board      A-38  

7.13

  Compliance with Laws      A-39  

7.14

  Operating Functions      A-39  

7.15

  Assumption of TRUPs      A-39  

7.16

  Shareholder Litigation      A-39  

7.17

  Dividends      A-39  

ARTICLE VIII

  Conditions to Consummation of the Merger      A-39  

8.01

  Conditions to Each Party’s Obligation to Effect the Merger      A-39  

 

A-i


Table of Contents
         Page  

8.02

  Conditions to Obligation of CBTC      A-40  

8.03

  Conditions to Obligation of United      A-40  

ARTICLE IX

  Termination      A-41  

9.01

  Termination      A-41  

9.02

  Effect of Termination and Abandonment      A-43  

9.03

  Fees and Expenses      A-43  

ARTICLE X

  Miscellaneous      A-44  

10.01

  Survival      A-44  

10.02

  Waiver; Amendment      A-44  

10.03

  Assignment      A-44  

10.04

  Counterparts      A-44  

10.05

  Governing Law      A-44  

10.06

  Expenses      A-45  

10.07

  Notices      A-45  

10.08

  Entire Understanding; No Third-Party Beneficiaries      A-45  

10.09

  Severability      A-45  

10.10

  Disclosures      A-46  

10.11

  Interpretation; Effect      A-46  

10.12

  Publicity      A-46  

 

Exhibit A    Plan of Merger merging CBTC with and into United
Exhibit B    Bank Merger Agreement
Exhibit C    Plan of Merger merging Essex Bank with and into United Bank
Exhibit D    Form of CBTC Support Agreement

 

A-ii


Table of Contents

AGREEMENT AND PLAN OF REORGANIZATION, dated as of June 2, 2021 (this “Agreement”), by and between COMMUNITY BANKERS TRUST CORPORATION (“CBTC”) and UNITED BANKSHARES, INC. (“United”).

RECITALS

A. CBTC. CBTC is a Virginia corporation, having its principal place of business in Richmond, Virginia.

B. United. United is a West Virginia corporation, having its principal place of business in Charleston, West Virginia.

C. Intentions of the Parties. It is the intention of the parties to this Agreement that the business combination contemplated hereby be treated as a “reorganization” under Section 368 of the Internal Revenue Code of 1986, as amended (the “Code”), and this Agreement is intended to be adopted as a “plan of reorganization” for purposes of Sections 354 and 361 of the Code.

D. Board Action. The respective Boards of Directors of each of United and CBTC have determined that it is in the best interests of their respective companies and their shareholders to consummate the strategic business combination transaction provided for herein.

E. Support Agreements. Each of the directors of CBTC and Essex Bank in office and who owns shares of CBTC Common Stock as of the date of this Agreement has, concurrently with the execution of this Agreement, entered into a Support Agreement in substantially the form attached hereto as Exhibit D.

NOW, THEREFORE, in consideration of the premises and of the mutual covenants, representations, warranties and agreements contained herein the parties agree as follows:

ARTICLE I

Certain Definitions

1.01 Certain Definitions. The following terms are used in this Agreement with the meanings set forth below:

Acquisition Agreement” means any letter of intent, memorandum of understanding, agreement in principle, acquisition agreement, merger agreement, or other similar agreement constituting or related to, or which is intended to or would be reasonably likely to lead to, any Acquisition Proposal.

Acquisition Proposal” means any tender or exchange offer, proposal for a merger, consolidation or other business combination involving CBTC or any of its Significant Subsidiaries or any proposal or offer to acquire equity interests representing 24.99% or more of the voting power of, or at least 24.99% of the assets or deposits of, CBTC or any of its Significant Subsidiaries, other than the transactions contemplated by this Agreement.

Additional Cash Payment Per Share” has the meaning set forth in Section 9.01(i)(i)(b).

Adverse Recommendation Change” has the meaning set forth in Section 7.02.

Agreement” has the meaning set forth in the preamble to this Agreement.

ALLL” has the meaning set forth in Section 6.03(w).

 

A-1


Table of Contents

Average Index Price” has the meaning set forth in Section 9.01(i)(ii).

Average United Closing Price” means the volume-weighted average of the closing sales price on Nasdaq of United Common Stock for the 20 full trading days ending on the second trading day immediately preceding the Effective Date.

Average United Stock Price” has the meaning set forth in Section 9.01(i)(ii).

Bank Merger” has the meaning set forth in Section 3.01(a).

Bank Merger Agreement” means the Agreement and Plan of Merger of Essex Bank with and into United Bank, attached as Exhibit B.

Bank Merger Effective Date” has the meaning set forth in Section 3.02.

Book-Entry Shares” has the meaning set forth in Section 4.04.

CBTC” has the meaning set forth in the preamble to this Agreement.

CBTC Articles” means the Articles of Incorporation of CBTC, as amended.

CBTC Board” means the Board of Directors of CBTC.

CBTC Bylaws” means the Bylaws of CBTC, as amended.

CBTC Common Stock” means the common stock, par value $0.01 per share, of CBTC.

CBTC Meeting has the meaning set forth in Section 7.02.

CBTC Series A Preferred Stock has the meaning set forth in Section 6.03(b).

CBTC Stock Award has the meaning set forth in Section 4.06(b).

CBTC Stock Option has the meaning set forth in Section 4.06(a).

CBTC Stock Plans” has the meaning set forth in Section 4.06(a).

CBTC’s SEC Documents has the meaning set forth in Section 6.03(g)(i).

CBTC Systems” has the meaning set forth in Section 6.03(z)(i).

Code has the meaning set forth in the recitals.

Community Reinvestment Act” has the meaning set forth in Section 6.03(j)(vi).

Compensation and Benefit Plans has the meaning set forth in Section 6.03(m)(i).

Confidentiality Agreement” has the meaning set forth in Section 7.04(d).

Consultants” has the meaning set forth in Section 6.03(m)(i).

Costs has the meaning set forth in Section 7.09(a).

 

A-2


Table of Contents

Deferred Compensation Plan has the meaning set forth in Section 6.03(m)(xi).

Derivative Transaction” means any swap transaction, option, warrant, forward purchase or sale transaction, futures transaction, cap transaction, floor transaction or collar transaction relating to one or more currencies, commodities, bonds, equity securities, loans, interest rates, catastrophe events, weather-related events, credit-related events or conditions or any indexes, or any other similar transaction (including any option with respect to any of these transactions) or combination of any of these transactions, including collateralized mortgage obligations or other similar instruments or any debt or equity instruments evidencing or embedding any such types of transactions, and any related credit support, collateral or other similar arrangements related to such transactions.

Determination Date” has the meaning set forth in Section 9.01(i)(ii).

Directors has the meaning set forth in Section 6.03(m)(i).

Disclosure Schedule has the meaning set forth in Section 6.01.

DOL” means the United States Department of Labor.

Effective Date has the meaning set forth in Section 2.02.

Effective Time has the meaning set forth in Section 2.02.

Employees has the meaning set forth in Section 6.03(m)(i).

Environmental Laws means all applicable local, state and federal environmental, health and safety laws and regulations, including, without limitation, the Resource Conservation and Recovery Act, the Comprehensive Environmental Response, Compensation, and Liability Act, the Clean Water Act, the Federal Clean Air Act, and the Occupational Safety and Health Act, each as amended, regulations promulgated thereunder, and state counterparts.

ERISA means the Employee Retirement Income Security Act of 1974, as amended.

ERISA Affiliate has the meaning set forth in Section 6.03(m)(iii).

Essex Bank” means Essex Bank, a commercial bank chartered under the laws of the Commonwealth of Virginia and a wholly owned direct subsidiary of CBTC.

Essex Loans means any written loan, loan agreement, note or borrowing arrangement (including leases, credit enhancements, guarantees and interest-bearing assets) to which Essex Bank is party as a creditor.

Exchange Act means the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder.

Exchange Agent means Computershare Limited.

Exchange Fund” has the meaning set forth in Section 4.04(a).

Exchange Ratio has the meaning set forth in Section 4.01(a).

Federal Reserve Board” means the Board of Governors of the Federal Reserve System.

Fee has the meaning set forth in Section 9.03(a).

 

A-3


Table of Contents

FDIA” has the meaning set forth in Section 6.03(j)(vi).

GAAP” means United States generally accepted accounting principles as in effect from time to time, consistently applied.

Governmental Authority means any court, administrative agency or commission or other federal, state or local governmental authority or instrumentality.

IRS” has the meaning set forth in Section 6.03(j)(v).

Indemnified Party has the meaning set forth in Section 7.09(a).

Index” has the meaning set forth in Section 9.01(i)(ii).

Index Price” has the meaning set forth in Section 9.01(i)(ii).

Index Ratio” has the meaning set forth in Section 9.01(i)(i).

Insurance Amount has the meaning set forth in Section 7.09(c).

Investment Advisers Act” has the meaning set forth in Section 6.03(aa).

knowledge” has the meaning set forth in Section 6.02.

law” means any code, law (including common law), ordinance, regulation, reporting or licensing requirement, rule, or statute applicable to a Person, its assets, liabilities or business, including those promulgated, interpreted or enforced by any Governmental Authority.

Lien means any charge, mortgage, pledge, security interest, restriction, claim, lien, or encumbrance.

Material Adverse Effect means, with respect to United or CBTC, any event, change, effect, development, state of facts, condition, circumstances or occurrence that, individually or in the aggregate, (i) is material and adverse to the financial position, results of operations or business of United and its Subsidiaries taken as a whole or CBTC and its Subsidiaries taken as a whole, respectively, or (ii) would materially impair the ability of either United or CBTC to perform its respective obligations under this Agreement or otherwise materially threaten or materially impede the consummation of the Merger and the other transactions contemplated by this Agreement; provided that Material Adverse Effect shall not include the impact of (a) changes in tax, banking and similar laws of general applicability or interpretations thereof by courts or Governmental Authorities (including the Pandemic Measures), except to the extent that such changes have a disproportionate impact on United or CBTC, as the case may be, relative to the overall effects on the banking industry, (b) changes in GAAP or regulatory accounting requirements applicable to banks and their holding companies generally, except to the extent that such changes have a disproportionate impact on United or CBTC, as the case may be, relative to the overall effects on the banking industry, (c) changes in economic conditions affecting financial institutions generally, including changes in market interest rates, credit availability and liquidity, and price levels or trading volumes in securities markets except to the extent that such changes have a disproportionate impact on United or CBTC, as the case may be, relative to the overall effects on the banking industry, (d) any modifications or changes to valuation policies and practices in connection with the Merger in accordance with GAAP, (e) actions and omissions of United or CBTC taken with the prior written consent of the other in contemplation of the transactions contemplated hereby, (f) any outbreak or escalation of hostilities or war (whether or not declared) or any act of terrorism, any earthquakes, hurricanes, tornados or other natural disasters, or any national or global epidemic, pandemic or disease outbreak (including the Pandemic), or the material worsening of such conditions threatened or existing as of the date of this Agreement (including any such

 

A-4


Table of Contents

changes arising out of the Pandemic or any Pandemic Measures), (g) failure of United or CBTC to meet any internal financial forecasts or any earnings projections (whether made by United or CBTC or any other Person), (h) the public disclosure of this Agreement and the impact thereof on relationships with customers or employees, or (i) the effects of compliance with this Agreement on the operating performance of the parties, including, expenses incurred by the parties in consummating the transactions contemplated by this Agreement.

Materially Burdensome Regulatory Condition” has the meaning set forth in Section 7.08(a).

Merger has the meaning set forth in Section 2.01(a).

Merger Consideration has the meaning set forth in Section 4.01(a).

Nasdaq means as The NASDAQ Stock Market, Inc.’s Global Select Market.

Notice of Recommendation Change” has the meaning set forth in Section 7.02.

Old Certificates has the meaning set forth in Section 4.04(a).

Pandemic” means any outbreaks, epidemics or pandemics relating to COVID-19, or any variants or mutations thereof, or any other viruses, and the governmental and other responses thereto.

Pandemic Measures” means any quarantine, “shelter in place,” “stay at home,” workforce reduction, social distancing, shutdown, closure, sequester or other laws, directives, policies, guidelines or recommendations promulgated by any Governmental Authority, in each case, in connection with or in response to the Pandemic.

PBGC means the Pension Benefit Guaranty Corporation.

Pension Plan has the meaning set forth in Section 6.03(m)(ii).

Permitted Liens” has the meaning set forth in Section 6.03(x).

Person means any individual, bank, corporation, limited liability company, partnership, association, joint-stock company, business or other trust or unincorporated organization.

Plan of Merger” means the Plan of Merger in the form hereof attached as Exhibit A.

Previously Disclosed by a party shall mean information set forth in its Disclosure Schedule or in its SEC Documents.

Proxy Statement has the meaning set forth in Section 7.03(a).

Registration Statement has the meaning set forth in Section 7.03(a).

Regulatory Authority” and “Regulatory Authorities each has the meaning set forth in Section 6.03(i)(i).

Regulatory Communication has the meaning set forth in Section 7.08(a).

Replacement Option” has the meaning set forth in Section 4.06(a).

Rights means, with respect to any Person, securities, agreements, plans (including any employee stock purchase plans, dividend reinvestment plans or other equity plans) or obligations convertible into or

 

A-5


Table of Contents

exercisable or exchangeable for, or giving any Person any right to subscribe for or acquire, or any options, calls or commitments relating to, or any stock appreciation right or other instrument the value of which is determined in whole or in part by reference to the market price or value of, shares of capital stock of such Person.

SEC means the Securities and Exchange Commission.

SEC Documents” means any registration statement, prospectus, report, schedule and definitive proxy statement and other documents filed with or furnished to the SEC by United or CBTC or any of their Subsidiaries pursuant to the Securities Act or Exchange Act.

Securities Act means the Securities Act of 1933, as amended, and the rules and regulations thereunder.

SERP” has the meaning set forth in Section 6.03(m)(xi).

Starting Date” has the meaning set forth in Section 9.01(i)(ii).

Starting Price” has the meaning set forth in Section 9.01(i)(ii).

Subsidiary” and “Significant Subsidiary”, including the plural versions of such terms, have the meanings ascribed to them in Rule 1-02(x) and Rule 1-02(w), respectively, of Regulation S-X of the SEC.

Superior Proposal” has the meaning set forth in Section 9.01(h).

Surviving Entity has the meaning set forth in Section 2.01(a).

Takeover Laws has the meaning set forth in Section 6.03(o).

Tax and “Taxes means all federal, state, local or foreign taxes, charges, fees, levies or other assessments, however denominated, including, without limitation, all net income, gross income, gains, gross receipts, sales, use, ad valorem, goods and services, capital, production, transfer, franchise, windfall profits, license, withholding, payroll, employment, disability, employer health, excise, estimated, severance, stamp, occupation, property, environmental, unemployment or other taxes, custom duties, fees, assessments or charges of any kind whatsoever, together with any interest and any penalties, additions to tax or additional amounts imposed by any Governmental Authority.

Tax Returns means any return, amended return or other report (including elections, declarations, disclosures, schedules, estimates and information returns) required to be filed with respect to any Tax.

United has the meaning set forth in the preamble to this Agreement.

United Articles” means the Articles of Incorporation, as amended, of United.

United Bank” means United Bank, a commercial bank chartered under the laws of the Commonwealth of Virginia.

United Board means the Board of Directors of United.

United Book-Entry Shares has the meaning set forth in Section 4.04(a).

United Bylaws” means the Bylaws of United, as amended.

United Common Stock means the common stock, par value $2.50 per share, of United.

 

A-6


Table of Contents

United Compensation and Benefit Plans has the meaning set forth in Section 6.04(l)(i).

United ERISA Affiliate” has the meaning set forth in Section 6.04(l)(ii).

United ERISA Affiliate Plan” has the meaning set forth in Section 6.04(l)(ii).

United Pension Plan” has the meaning set forth in Section 6.04(l)(i).

United Preferred Stock” has the meaning set forth in Section 6.04(b)(i).

United Ratio” has the meaning set forth in Section 9.01(i)(i)(B).

United’s SEC Documents has the meaning set forth in Section 6.04(g)(i).

United Systems” has the meaning set forth in Section 6.04(s)(i).

VBFI” means the Virginia Bureau of Financial Institutions.

VSCA” means the Virginia Stock Corporation Act, as amended.

VSCC means the State Corporation Commission of the Commonwealth of Virginia.

WVBCA” means the West Virginia Business Corporation Act, as amended.

WVSOS” means the Secretary of State of the State of West Virginia.

ARTICLE II

The Merger

2.01 The Merger.

(a) Subject to the terms and conditions hereinafter set forth, including the Plan of Merger substantially in the form attached as Exhibit A, at the Effective Time, CBTC shall merge with and into United (the “Merger”), the separate corporate existence of CBTC shall cease and United shall survive and continue to exist as a West Virginia corporation (United, as the surviving entity in the Merger, sometimes being referred to herein as the “Surviving Entity”). United may at any time prior to the Effective Time change the method of effecting the combination with CBTC (including, without limitation, the provisions of this Article II) if and to the extent it deems such change to be necessary, appropriate or desirable; provided that no such change shall (i) alter or change the amount or kind of Merger Consideration, (ii) adversely affect the tax-free treatment of the Merger to CBTC’s shareholders as a result of receiving the Merger Consideration or (iii) materially impede or delay consummation of the transactions contemplated by this Agreement; and provided, further, that United shall provide CBTC with seven (7) days prior written notice of such change and the reasons therefor.

(b) Subject to the satisfaction or waiver of the conditions set forth in Article VIII, the Merger shall become effective upon (i) the filing with the VSCC and the WVSOS of articles of merger in accordance with Section 13.1-720 of the VSCA and Section 31D-11-1106 of the WVBCA, and the issuance by each of the VSCC and the WVSOS of a certificate of merger relating to the Merger or (ii) effective upon such later date and time as may be set forth in such articles of merger. The Merger shall have the effects prescribed in the VSCA and the WVBCA.

(c) The United Articles and the United Bylaws, each as in effect immediately prior to the Effective Time, shall be the articles of incorporation and the bylaws of the Surviving Entity until thereafter amended in accordance with applicable law.

 

A-7


Table of Contents

2.02 Effective Date and Effective Time. Provided that the conditions set forth in Article VIII shall have been satisfied or waived in accordance with the terms of this Agreement, other than those conditions that by their nature are to be satisfied at the closing of the Merger, the parties shall cause the effective date of the Merger (the “Effective Date”) to occur on the date immediately prior to the conversion of the data processing systems of Essex Bank with the data processing systems of United Bank; provided, that if such date shall not have occurred by December 6, 2021, then the parties shall cause the Effective Date of the Merger to occur on the sooner of (i) five business days thereafter if all of the conditions set forth in Article VIII have been satisfied or waived as of such date or (ii) five business days following the satisfaction or waiver of the conditions set forth in Article VIII, unless another date is agreed to by CBTC and United in writing. The consummation of the Merger may be effected by electronic or other transmission of signature pages, as mutually agreed upon. The time on the Effective Date when the Merger shall become effective is referred to as the “Effective Time.”

2.03 Tax Consequences. It is intended that the Merger shall constitute a “reorganization” within the meaning of Section 368(a) of the Code, and that this Agreement shall constitute a “plan of reorganization” for purposes of Sections 354 and 361 of the Code.

ARTICLE III

The Bank Merger

3.01 The Bank Merger.

(a) After the Effective Time, Essex Bank, the wholly owned subsidiary of CBTC, shall merge with and into United Bank, a wholly owned subsidiary of United (the “Bank Merger”), pursuant to the terms and conditions of the Bank Merger Agreement including the plan of merger substantially in the form attached as Exhibit C, the separate existence of Essex Bank shall cease and United Bank shall survive and continue to exist as a banking corporation chartered under the laws of the Commonwealth of Virginia. United may at any time prior to the Effective Time, change the method of effecting the combination with Essex Bank (including, without limitation, the provisions of this Article III) if and to the extent it deems such changes necessary, appropriate or desirable; provided, however, that no such change shall (i) alter or change the amount or kind of Merger Consideration, (ii) adversely affect the ability of the Merger to qualify as a “reorganization” within the meaning of Section 368(a) of the Code to CBTC’s shareholders as a result of receiving the Merger Consideration or (iii) materially impede or delay consummation of the transactions contemplated by this Agreement; and provided, further, that United shall provide CBTC with seven (7) days prior written notice of such change and the reasons therefor.

(b) Subject to the satisfaction or waiver of the conditions set forth in Article VIII, the Bank Merger shall become effective upon the filing with the VSCC articles of merger in accordance with Section 13.1-720 of the VSCA, and the issuance by the VSCC of a certificate of merger relating to the Bank Merger, or such later date and time as may be set forth in such articles of merger. The Bank Merger shall have the effects prescribed in the VSCA.

3.02 Effective Date and Effective Time. Subject to the satisfaction or waiver of the conditions set forth in Article VIII, it being agreed that any required consents, approvals, and authorizations from any Governmental Authorities to effect the Bank Merger shall not be a condition to the consummation of the Merger, the parties shall use reasonable efforts to cause the effective date of the Bank Merger (the “Bank Merger Effective Date”) to occur as soon as reasonably practicable after the Effective Date or such later date to which the parties may agree in writing.

 

A-8


Table of Contents

ARTICLE IV

Consideration; Exchange Procedures

4.01 Merger Consideration. Subject to the provisions of this Agreement, at the Effective Time, automatically by virtue of the Merger and without any action on the part of any Person:

(a) Merger Consideration. Each issued and outstanding share of CBTC Common Stock (other than shares of CBTC Common Stock held by United and its Subsidiaries, in each case except for shares held by them in a fiduciary capacity or as a result of debts previously contracted) shall be converted into the right to receive, subject to the limitations set forth in this Agreement, 0.3173 shares (“Exchange Ratio”) of United Common Stock (the “Merger Consideration”).

(b) Outstanding United Stock. Each share of United Common Stock issued and outstanding immediately prior to the Effective Time shall remain issued and outstanding and unaffected by the Merger.

4.02 Rights as Shareholders; Stock Transfers. At the Effective Time, holders of CBTC Common Stock shall cease to be, and shall have no rights as, shareholders of CBTC, other than to receive the Merger Consideration (if so provided in Section 4.01(a)) and any dividend or other distribution with respect to such CBTC Common Stock with a record date occurring prior to the Effective Time, and the consideration provided under this Article IV. After the Effective Time, there shall be no transfers on the stock transfer books of CBTC or the Surviving Entity of shares of CBTC Common Stock.

4.03 Fractional Shares. Notwithstanding any other provision of this Agreement, each holder of shares of CBTC Common Stock exchanged pursuant to the Merger, who would otherwise have been entitled to receive a fraction of a share of United Common Stock (after taking into account all Old Certificates and the Book-Entry Shares delivered by such holder), shall receive, in lieu thereof, cash (without interest) in an amount equal to such fractional part of a share of United Common Stock multiplied by the Average United Closing Price. No such holder will be entitled to dividends, voting rights, or any other rights as a shareholder in respect of any fractional shares.

4.04 Exchange Procedures.

(a) At or prior to the Effective Time, United shall deposit, or shall cause to be deposited, with the Exchange Agent, for the benefit of the holders of certificates formerly representing shares of CBTC Common Stock (“Old Certificates”) and holders of non-certificated shares of CBTC Common Stock (“Book-Entry Shares”), for exchange in accordance with this Article IV, (i) non-certificated shares of United Common Stock (collectively, “United Book-Entry Shares”) and (ii) an amount of cash necessary for payments required by Section 4.03 (the “Exchange Fund”). The Exchange Fund will be distributed in accordance with the Exchange Agent’s normal and customary procedures established in connection with merger transactions.

(b) As soon as practicable after the Effective Time, and in no event later than five (5) business days thereafter, the Exchange Agent shall mail to each holder of record of one or more Old Certificates or Book-Entry Shares a letter of transmittal (which shall specify that delivery shall be effected, and risk of loss and title to the Old Certificates or Book-Entry Shares shall pass, only upon delivery of the Old Certificates or Book-Entry Shares to the Exchange Agent) and instructions for use in effecting the surrender of the Old Certificates or Book-Entry Shares in exchange for United Book-Entry Shares, if any, that the holders of the Old Certificates or Book-Entry Shares are entitled to receive pursuant to Article IV, and any cash in lieu of fractional shares into which the shares of CBTC Common Stock represented by the Old Certificates or Book-Entry Shares shall have been converted pursuant to this Agreement. Upon proper surrender of an Old Certificate or Book-Entry Shares for exchange and cancellation to the Exchange Agent, together with such properly completed letter of transmittal, duly executed, the holder of such Old Certificates or Book-Entry Shares shall be entitled to receive in exchange therefor (i) United Book-Entry Shares representing that number of whole shares of United Common Stock that

 

A-9


Table of Contents

such holder has the right to receive pursuant to Article IV, if any, and (ii) a check representing the amount of any cash in lieu of fractional shares which such holder has the right to receive in respect of the Old Certificates or Book-Entry Shares surrendered pursuant to the provisions of this Article IV, and the Old Certificates or Book-Entry Shares so surrendered shall forthwith be cancelled.

(c) If any Old Certificates or Book-Entry Shares representing CBTC Common Stock have been lost, mutilated, stolen, or destroyed, upon the making of an affidavit of that fact by the Person claiming such Old Certificates or Book-Entry Shares to be lost, stolen, mutilated, destroyed or are otherwise missing, and, if requested by the Exchange Agent, the posting by such Person of a bond in such amount as the Exchange Agent reasonably directs as indemnity against any claim that may be made against it or United with respect to such Old Certificate or Book-Entry Shares, the Exchange Agent shall issue in exchange for such lost, mutilated, stolen, or destroyed Old Certificate or Book-Entry Shares the Merger Consideration as provided for in this Section 4.04. Neither the Exchange Agent, if any, nor any party hereto shall be liable to any former holder of CBTC Common Stock for any amount properly delivered to a public official pursuant to applicable abandoned property, escheat or similar laws.

(d) No dividends or other distributions with respect to United Common Stock with a record date occurring after the Effective Time shall be paid to the holder of any unsurrendered Old Certificate or Book-Entry Shares representing shares of CBTC Common Stock converted in the Merger into the right to receive shares of such United Common Stock until the holder thereof shall be entitled to receive United Book-Entry Shares in exchange therefore in accordance with the procedures set forth in this Section 4.04. After becoming so entitled in accordance with this Section 4.04, the record holder thereof also shall be entitled to receive any such dividends or other distributions by the Exchange Agent, without any interest thereon, which theretofore had become payable with respect to shares of United Common Stock such holder had the right to receive upon surrender of the Old Certificates or Book-Entry Shares.

(e) Any portion of the Exchange Fund that remains unclaimed by the shareholders of CBTC on the business day after the one-year anniversary of the Effective Date shall be paid to United. Any shareholders of CBTC who have not theretofore complied with this Article IV shall thereafter look only to United for payment of the Merger Consideration, cash in lieu of any fractional shares and unpaid dividends and distributions on United Common Stock deliverable in respect of each share of CBTC Common Stock such shareholder holds as determined pursuant to this Agreement, in each case, without any interest thereon.

4.05 Anti-Dilution Provisions. In the event United changes (or establishes a record date for changing) the number of shares of United Common Stock issued and outstanding prior to the Effective Date as a result of a stock split, reverse stock split, stock dividend, reorganization, recapitalization or similar transaction with respect to the outstanding United Common Stock and the record date therefor shall be prior to the Effective Date, or shall establish a record date prior to the Effective Date with respect to any dividend or other distribution in respect of the United Common Stock other than a cash dividend consistent with past practice, the Exchange Ratio shall be proportionately adjusted to provide the holders of CBTC Common Stock the same economic effect as contemplated by this Agreement prior to such event. Notwithstanding any other provisions of this Section 4.05, no adjustment shall be made in the event of the issuance of additional shares of United Common Stock pursuant to any dividend reinvestment plan or direct investment plan of United or in connection with the issuance of shares as consideration in a transaction where United is the surviving corporation or in connection with any offering of shares where United receives consideration in exchange for the shares so offered.

4.06 Equity-Based Awards.

(a) At the Effective Time, each outstanding option (each, a “CBTC Stock Option”) to purchase shares of CBTC Common Stock, whether vested or unvested, under any and all plans of CBTC under which stock options have been granted (collectively, the “CBTC Stock Plans”) shall vest only as provided pursuant to the terms thereof and shall be converted into an option (each, a “Replacement Option”) to acquire, on the same terms and conditions as were applicable under such CBTC Stock Option, the number of shares of United Common Stock equal to (a) the number of shares of CBTC Common Stock subject to the CBTC Stock Option multiplied

 

A-10


Table of Contents

by (b) the Exchange Ratio. Such product shall be rounded down to the nearest whole number. The exercise price per share (rounded up to the next whole cent) of each Replacement Option shall equal (y) the exercise price per share of shares of CBTC Common Stock that were purchasable pursuant to such CBTC Stock Option divided by (z) the Exchange Ratio. Notwithstanding the foregoing, each CBTC Stock Option that is intended to be an “incentive stock option” (as defined in Section 422 of the Code) shall be adjusted in accordance with the requirements of Section 424 of the Code and all other options shall be adjusted in a manner that maintains the options exemption from Section 409A of the Code. At or prior to the Effective Time, CBTC shall use its reasonable best efforts to obtain any necessary consents from optionees with respect to the CBTC Stock Plans to permit replacement of the outstanding CBTC Stock Options by United pursuant to this Section and to permit United to assume the CBTC Stock Plans. CBTC shall further take all action necessary to amend the CBTC Stock Plans to eliminate automatic grants or awards thereunder, if any, following the Effective Time. At the Effective Time, United shall assume the CBTC Stock Plans; provided that such assumption shall only be with respect to the Replacement Options and shall have no obligation to make any additional grants or awards under the CBTC Stock Plans other than those grants or awards that have been made or accrued prior to the Effective Time. United shall file a post-effective amendment to the Registration Statement or an effective registration statement on Form S-8 (or other applicable form) with respect to the shares of United Common Stock subject to such Replacement Options, shall distribute a prospectus relating to such Form S-8, if applicable, and shall use commercially reasonable efforts to maintain the effectiveness of the Registration Statement or registration statement on Form S-8 for so long as such Replacement Options remain outstanding.

(b) At the Effective Time, each restricted stock unit grant and any other award with respect to a share of CBTC Common Stock subject to vesting, repurchase or other lapse restriction under a CBTC Stock Plan that is outstanding immediately prior to the Effective Time other than a CBTC Stock Option (each, a “CBTC Stock Award”) shall vest only in accordance with the formula and other terms of the CBTC Stock Award, be cancelled and converted automatically into the right to receive the Merger Consideration in respect of each share of CBTC Common Stock underlying such vested CBTC Stock Award. The Surviving Corporation shall issue the consideration described in this Section 4.06(b) less applicable tax withholdings within five (5) business days following the Effective Date.

(c) United and CBTC agree to adopt any resolutions and take all steps necessary (including obtaining any participant consents or providing any required or advisable notices to any participant) to effect the provisions of this Section 4.06.

4.07 Withholding Rights. United or the Exchange Agent, as the case may be, will be entitled to deduct and withhold from the consideration otherwise payable pursuant to this Agreement to any Person such amounts, if any, as it is required to deduct and withhold with respect to the making of such payment under the Code or any provision of state, local or foreign Tax law. To the extent that amounts are so withheld and remitted to the appropriate Governmental Authority by or on behalf of United or the Exchange Agent, as the case may be, such amounts withheld will be treated for all purposes of this Agreement as having been paid to such Person in respect of which such deduction and withholding was made by United or the Exchange Agent, as the case may be.

ARTICLE V

Actions Pending the Effective Time

5.01 Forbearances of CBTC. From the date hereof until the Effective Time, except as expressly contemplated by this Agreement or Previously Disclosed, without the prior written consent of United (which consent shall not be unreasonably withheld, delayed or conditioned), CBTC will not, and will cause each of its Subsidiaries not to:

(a) Ordinary Course. Conduct the business of CBTC and its Subsidiaries other than in the ordinary course, fail to use reasonable efforts to preserve intact their business organizations and assets and maintain their

 

A-11


Table of Contents

rights, franchises and existing relations with customers, suppliers, employees and business associates, make any capital expenditure in excess of $500,000 in the aggregate or take any action reasonably likely to have an adverse effect upon CBTC’s ability to perform any of its material obligations under this Agreement. For purposes of this Agreement, the term “ordinary course,” with respect to either party, shall take into account the commercially reasonable actions taken by such party and its Subsidiaries in response to the Pandemic and the Pandemic Measures.

(b) Capital Stock. Other than pursuant to Rights Previously Disclosed and outstanding on the date hereof, (i) issue, sell or otherwise permit to become outstanding, or authorize the creation of, any additional shares of CBTC Common Stock or any Rights, (ii) enter into any agreement with respect to the foregoing, or (iii) permit any additional shares of CBTC Common Stock to become subject to new grants of employee or director stock options, other Rights or similar stock-based employee rights; provided that none of the foregoing shall restrict CBTC from making equity compensation awards and issuing shares of CBTC Common Stock, rights, employee or director stock options, or similar equity compensation awards under the CBTC Stock Plans in the ordinary course of business consistent with past practice; and provided, further, that any such awards will not exceed the amounts set forth in Section 5.01(b) of CBTC’s Disclosure Schedule.

(c) Dividends, Etc. Except as Previously Disclosed and subject to the terms of Section 7.17, (i) make, declare, pay or set aside for payment any dividend (other than quarterly cash dividends at a rate not to exceed $0.07 per share on CBTC Common Stock and dividends from wholly-owned Subsidiaries to CBTC or another wholly-owned Subsidiary of CBTC) on or in respect of, or declare or make any distribution on any shares of CBTC Common Stock or (ii) directly or indirectly adjust, split, combine, redeem, reclassify, purchase or otherwise acquire, any shares of its capital stock; provided that none of the foregoing shall restrict CBTC from acquiring shares of its capital stock pursuant to the surrender of any such shares in payment of an exercise price or in satisfaction of a Tax withholding obligation, or pursuant to similar transactions, in connection with (x) the exercise of CBTC Stock Options and other Rights Previously Disclosed, and (y) vesting of CBTC Stock Awards.

(d) Compensation; Employment Agreements; Etc. (i) Enter into or amend or renew any employment, change in control employment or similar agreement, consulting, compensation, bonus, severance or similar agreements or arrangements with any director, officer, employee, consultant or other independent contractor service provider of CBTC or its Subsidiaries, except as Previously Disclosed, or (ii) grant any salary or wage increase other than normal individual increases in compensation to employees in the ordinary course of business consistent with past practice.

(e) Benefit Plans. Enter into, establish, adopt or amend (except (i) as may be required by applicable law, (ii) as Previously Disclosed or (iii) to satisfy Previously Disclosed contractual obligations existing as of the date hereof) any pension, retirement, stock option, stock purchase or other equity incentive agreement, award or plan, savings, profit sharing, deferred compensation, SERP, performance driven retirement or similar agreement, consulting, bonus, group insurance, split dollar agreement or arrangement or other employee benefit, incentive or welfare contract, plan or arrangement, or any trust agreement (or similar arrangement) related thereto, in respect of any director, officer, employee, consultant or other independent contractor or other service provider of CBTC or its Subsidiaries, or take any action to accelerate the vesting or exercisability of stock options, restricted stock unit or other compensation or benefits payable thereunder.

(f) Dispositions. Sell, transfer, mortgage, encumber or otherwise dispose of or discontinue any of its assets, deposits, business or properties except in the ordinary course of business and in a transaction that is not material to it and its Subsidiaries taken as a whole.

(g) Acquisitions. Except in the ordinary course of its business, acquire (other than by way of foreclosures or acquisitions of control in a bona fide fiduciary capacity or in satisfaction of debts previously contracted in good faith, in each case in the ordinary course of business consistent with past practice) all or any portion of, the assets, business, deposits or properties of any other entity.

(h) Governing Documents. Amend the CBTC Articles, CBTC Bylaws or the articles of incorporation or bylaws (or similar governing documents) of any of CBTC’s Subsidiaries.

 

A-12


Table of Contents

(i) Accounting Methods. Implement or adopt any change in its accounting principles, practices or methods, other than as may be required by GAAP or its Regulatory Authorities.

(j) Contracts. Except in the ordinary course of business consistent with past practice, enter into or terminate any material contract (as defined in Section 6.03(k)) or amend or modify any of its existing material contracts in a manner that is material to CBTC and its Subsidiaries taken as a whole.

(k) Claims. Except in the ordinary course of business consistent with past practice, settle any claim, action or proceeding, except for any claim, action or proceeding that does not involve precedent for other material claims, actions or proceedings and that involve solely money damages in an amount, individually or in the aggregate for all such settlements, that is not material to CBTC and its Subsidiaries, taken as a whole.

(l) Adverse Actions. (i) Take any action that would, or is reasonably likely to, prevent or impede the Merger from qualifying as a “reorganization” within the meaning of Section 368 of the Code; or (ii) knowingly take any action that is intended or is reasonably likely to result in (1) any of the conditions to the Merger set forth in Article VIII not being satisfied or (2) a material violation of any provision of this Agreement except, in each case, as may be required by applicable law or regulation.

(m) Risk Management. Except as required by applicable law or regulation, or by formal or informal agreements entered into with Regulatory Authorities, (i) implement or adopt any material change in its interest rate and other risk management policies, procedures or practices, (ii) fail to materially follow its existing policies or practices with respect to managing its exposure to interest rate and other risk, or (iii) fail to use commercially reasonable means to avoid any material increase in its aggregate exposure to interest rate risk.

(n) Indebtedness. Incur any indebtedness for borrowed money other than in the ordinary course of business.

(o) Subsidiaries. Organize or approve the organization of any Subsidiaries.

(p) Commitments. Agree or commit to do any of the foregoing.

5.02 Forbearances of United. From the date hereof until the Effective Time, except as expressly contemplated by this Agreement or Previously Disclosed, without the prior written consent of CBTC (which consent shall not be unreasonably withheld, delayed or conditioned), United will not, and will cause each of its Subsidiaries not to:

(a) Ordinary Course. Conduct the business of United and its Subsidiaries other than in the ordinary course or fail to use reasonable efforts to preserve intact their business organizations and assets and maintain their rights, franchises and existing relations with customers, suppliers, employees and business associates, or take any action reasonably likely to have an adverse effect upon United’s ability to perform any of its material obligations under this Agreement.

(b) Dividends. Make, declare, pay or set aside for payment any extraordinary dividend, other than in connection with the United Stock Repurchase Program; provided that the foregoing restriction shall not restrict United from making, declaring or paying its regular quarterly cash dividends and dividends from wholly-owned Subsidiaries to United or another wholly-owned Subsidiary of United (which, for the avoidance of doubt, will continue to be paid).

(c) Adverse Actions. (i) Take any action that would, or is reasonably likely to, prevent or impede the Merger from qualifying as a “reorganization” within the meaning of Section 368 of the Code; or (ii) knowingly take any action that is intended or is reasonably likely to result in (1) any of the conditions to the Merger set forth in Article VIII not being satisfied or (2) a material violation of any provision of this Agreement, except, in each case, as may be required by applicable law or regulation.

(d) Governing Documents. Amend its articles of incorporation or bylaws in a manner that would materially and adversely affect the benefits of the Merger to the shareholders of CBTC.

(e) Commitments. Agree or commit to do any of the foregoing.

 

A-13


Table of Contents

ARTICLE VI

Representations and Warranties

6.01 Disclosure Schedules. On or prior to the date hereof, United has delivered to CBTC a schedule and CBTC has delivered to United a schedule (respectively, its “Disclosure Schedule”) setting forth, among other things, items the disclosure of which is necessary or appropriate either in response to an express disclosure requirement contained in a provision hereof or as an exception to one or more representations or warranties contained in Section 6.03 or 6.04 or to one or more of its covenants contained in Article V; provided that (a) no such item is required to be set forth in a Disclosure Schedule as an exception to a representation or warranty if its absence would not be reasonably likely to result in the related representation or warranty being deemed untrue or incorrect under the standard set forth in Section 6.02 and (b) the mere inclusion of an item in a Disclosure Schedule as an exception to a representation or warranty shall not be deemed an admission by a party that such item represents a material exception or fact, event or circumstance or that such item is reasonably likely to result in a Material Adverse Effect on the party making the representation. All of CBTC’s and United’s representations, warranties and c