Item 5. Market for Registrant’s Common Equity
Item 5.
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
The common stock of Farmers & Merchants Bancorp is not widely held or listed on any exchange. However, trades are reported on the OTCQX under the symbol “FMCB.”
The following tables summarize the actual high, low, and close sale prices for the Company's common stock since the first quarter of 2023. These figures are based on activity posted on the OTCQX:
Year Ended December 31, 2024
High
Low
Close
Dividend Declared
First quarter
$
1,075.00
$
950.00
$
980.00
$
-
Second quarter
1,100.00
951.00
961.20
8.80
Third quarter
971.06
930.12
971.06
-
Fourth quarter
1,099.00
960.00
1,060.00
9.30
Year Ended December 31, 2023
High
Low
Close
Dividend Declared
First quarter
$
1,087.99
$
975.02
$
1,015.00
$
-
Second quarter
1,020.00
950.00
965.00
8.30
Third quarter
1,000.00
934.00
955.00
-
Fourth quarter
1,057.50
932.00
1,057.50
8.80
As of February 28, 2025, there were approximately 1,274 shareholders of record of the Company’s common stock. The Company and, before the Company was formed, the Bank, has paid cash dividends for the past 89
consecutive years. There are limitations under Delaware corporate law as to the amounts of cash dividends that may be paid by the Company. Additionally, if we decided to defer interest on our 2003 subordinated debentures, we would be prohibited
by the terms of the debentures from paying cash dividends on the Company’s common stock. The Company is dependent on cash dividends paid by the Bank to fund its cash dividend payments to its shareholders. There are regulatory limitations on cash
dividends that may be paid by the Bank. See “Item 1. Business – Supervision and Regulation.”
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On November 14, 2023, the Board of Directors authorized an extension to the Company’s share repurchase program through December 31, 2024 for an additional $25.0 million of the Company’s common stock, which
represented approximately 4% of outstanding shareholders’ equity at the time of approval. On September 10, 2024, the share repurchase program authorized in November 2023 was cancelled. On September 10, 2024, the Company authorized a new share
repurchase program for $55.0 million of the Company’s common stock, which represented approximately 9% of outstanding shareholders’ equity at the time of approval. Repurchases by the Company under the repurchase plan may be made from time to time
through open market purchases, trading plans established in accordance with SEC rules, privately negotiated transactions, or by other means.
During 2024, the Company spent $45.3 million, inclusive of the excise tax, on the repurchase of 48,173 shares, or approximately 6.44% of the total shares outstanding as of December 31, 2023. The Company repurchased
9,936 shares, or $10.1 million, under the $25.0 million share repurchase program authorized in November 2023, which was cancelled on September 10, 2024. The Company repurchased 38,237 shares, or $35.1 million, under the new share purchase program
authorized on September 10, 2024. All of these shares were purchased at prices ranging from $917.00 to $1,090.00 per share, for an average of $937.43 per share, based upon the then current price on the OTCQX or reflecting a negotiated block
discount. The Company did not issue any shares of common stock during 2024.
The actual means and timing of any repurchases, the quantity of purchased shares and prices will be subject to certain limitations, including, without limitation, market prices of the Company’s common shares,
general market and economic conditions, the Company’s financial performance, capital position, and applicable legal and regulatory requirements, and the discretion of the Chief Executive Officer and Chief Financial Officer.
Repurchases under the repurchase plan may be initiated, discontinued, suspended, or restarted at any time in the Company’s discretion. The Company is not obligated to repurchase any shares under the repurchase
plan. No shares may be repurchased pursuant to the authority granted in the repurchase plan after December 31, 2026. Repurchased shares may be used to fund the Company’s non-qualified retirement plans, may be returned to the status of authorized
but unissued common shares of the Company or may be retired.
The following table reports information regarding repurchases of our common stock during the fourth quarter of 2024:
Period
Total number
of shares
purchased
Average price
paid per share (1)
Total number of shares
purchased as part of
publicly announced
plans or programs
Maximum number (or
approximate dollar
value) of shares that
may yet be purchased
under the plans or
programs ( In
thousands )
October 1, 2024 to October 31, 2024
38,069
$
917.33
38,069
$
20,040
November 1, 2024 to November 30, 2024
11
1,000.00
11
20,029
December 1, 2024 to December 31, 2024
117
1,027.83
117
19,909
Total 4th Quarter 2024
38,197
$
917.69
38,197
$
19,909
Total 2024
48,173
$
937.43
48,173
$
19,909
(1) The aggregate purchase price and weighted average price per share does not include the effect of excise tax expense incurred on
net stock repurchases. For the year ended December 31, 2024, the excise tax expense totaled $452,000.
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Shareholder Rights Plan
On August 5, 2008, the Board of Directors approved a Share Purchase Rights Plan (the “Rights Plan”), pursuant to which the Company entered into a Rights Agreement dated August 5, 2008 (the “2008 Rights Agreement”),
with Computershare as Rights Agent, and the Company declared a dividend of a right to acquire one preferred share purchase right (a “Right”) for each outstanding share of the Company’s common stock, $0.01 par value per share, to shareholders of
record at the close of business on August 15, 2008. Generally, the Rights are only triggered and become exercisable if a person or group (the “Acquiring Person”), without the consent of the Company’s Board of Directors, acquires beneficial
ownership of 10 percent or more of the Company’s common stock or announces a tender offer for 10 percent or more of the Company’s common stock.
The Rights Plan is similar to plans adopted by many other publicly traded companies. The effect of the Rights Plan is to discourage any potential acquirer from triggering the Rights without first convincing the
Company’s Board of Directors that the proposed acquisition is fair to, and in the best interest of, all of the shareholders of the Company. The provisions of the Plan, if triggered by the Acquiring Person, will substantially dilute the equity and
voting interest of any potential acquirer unless the Board of Directors approves of the proposed acquisition (under Article XV of the Company’s Certificate of Incorporation, the Board of Directors has the authority to consider any and all factors
in determining whether an acquisition is in the best interests of the Company and its shareholders). Each Right, if and when exercisable, will entitle the registered holder to purchase from the Company one one-hundredth of a share of Series A
Junior Participating Preferred Stock, no par value (“Preferred Share”), at the purchase price set forth in the Rights Plan for each one one-hundredth of a share, subject to adjustment.
Each holder of a Right (except for the Acquiring Person, whose Rights will be null and void upon such event) shall thereafter have the right to receive, upon exercise, that number of Common shares of the Company
having a market value of two times the exercise price of the Right. At any time before a person becomes an Acquiring Person, the Rights can be redeemed, in whole, but not in part, by the Company’s Board of Directors at a price of $0.001 per
Right.
The Rights Plan was set to expire on August 5, 2018. On November 19, 2015, the Board of Directors approved a seven-year extension of the term of the Rights Plan. Pursuant to an Amendment to the 2008 Rights
Agreement dated February 18, 2016, the term of the Rights Plan was extended from August 5, 2018 to August 5, 2025. The extension of the term of the Rights Plan was intended as a means to continue to guard against abusive takeover tactics and was
not in response to any particular proposal. The Board also increased the purchase price under the Rights Plan from $1,200 to $1,600 per one one-hundredth of a Preferred Share, to reflect the increase in the market price of the Company’s common
stock over the past several years.
On April 5, 2024, the Company entered into an Amended and Restated Rights Agreement (the “Amended Rights Agreement”), which amended and restated the 2008 Rights Agreement. The Amended Rights Agreement extends the
expiration date of the Company’s Rights Plan from the close of business on August 5, 2025, to the close of business on August 5, 2034. At the time of the termination of the Amended Rights Agreement, all of the Rights distributed to holders of
the Company’s Preferred Shares pursuant to the Amended Rights Agreement will expire. The Amended Rights Agreement also increases the purchase price per unit under the Rights Agreement from $1,600 per one one-hundredth of a Preferred Share, to
$3,900 per one one-hundredth of a Preferred Share. The other changes reflected in the Amended Rights Agreement generally clarify the legal relationship between the Rights Agent and the Company and were made to conform the agreement to provisions
that have become customary in such agreements since the Rights Plan was originally adopted in 2008.
For information regarding securities authorized for issuance under equity compensation plans, see Part III, Item 12 “Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters”
of this Annual Report on Form 10-K.
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Performance Graph
The following graph compares the Company’s cumulative total stockholder return on common stock from December 31, 2019 to December 31, 2024 to that of: (i) the S&P 600 Regional Banks (Sub Ind) (TR) Index; and
(ii) the cumulative total return of the New York Stock Exchange AMEX Composite market index. The graph assumes an initial investment of $100 on December 31, 2019 and reinvestment of dividends. The stock price performance set forth in the
following graph is not necessarily indicative of future price performance. The Company’s stock price data is based on activity posted on the OTCQX and on private transactions between individual shareholders that are reported to the Company. This data was furnished by Zacks SEC Compliance Services Group.
This graph shall not be deemed filed or incorporated by reference into any filing under the Securities Act or the Exchange Act.
Item 6.
Reserved