First Reliance Bancshares, Inc. (OTCBB:FSRL) entered into a letter of intent agreement to acquire Independence Bancshares, Inc. (OTCPK:IEBS) on June 27, 2017. Under the terms of the agreement, First Reliance will offer cash price of $10.9 million, structured as redemption in full of the Series A preferred shares with the remaining proceeds payable to the common shares. First Reliance Bancshares, Inc. entered into definitive agreement to acquire Independence Bancshares, Inc. for $2.6 million on September 25, 2017. First Reliance will pay $0.125 cash for each outstanding common share of Independence Bancshares. First Reliance will also redeem $8.425 million of Independence's Series A Convertible Preferred Stock at the redemption price of $1,000 per share. First Reliance will use the proceeds from $25.1 million private placement of common and non-voting preferred stock to fund the transaction. Post-acquisition, Independence Bancshares will merge with and into First Reliance and in addition, concurrently with or as soon as practicable following the merger, Independence National Bank will be merged with and into First Reliance Bank. First Reliance expects to recover Independence's deferred tax assets and other related tax benefits totaling approximately $1.9 million. Independence Bancshares will pay a termination fee of $0.5 million to First Reliance Bancshares, if the transaction gets terminated. On September 25, 2017, Lawrence R. Miller, Chief Executive Officer of Independence Bancshares entered into an amendment to his amended and restated employment agreement which provides termination of his employment effective upon the consummation of the merger. Martha L. Long, Chief Financial Officer of Independence Bancshares and E. Fred Moore, Chief Credit Officer of Independence Bancshares, each entered into a non-solicitation agreement with First Reliance that will prohibit them from recruiting employees and soliciting customers of First Reliance until the later of two years after the merger or one year following the termination of their service as an employee or consultant of First Reliance Bank. All board seats will be retained by First Reliance Bancshares. The transaction is subject to standard regulatory approvals, two-third of shareholder approval from Independence Bancshares, as well as other customary conditions. The transaction is also subject to redemption of Independence Series A Preferred Stock, minimum balance sheet requirements for total shareholder's equity, loans and deposits and execution of employment agreement, non-competition agreement, non-solicitation agreement and shareholder support agreement. The Boards of Directors of First Reliance and Independence Bancshares have unanimously approved the merger transaction. As of January 11, 2018, Federal Deposit Insurance Corporation and the South Carolina Board of Financial Institutions have granted the regulatory approvals necessary and the shareholders of Independence approved the merger. The transaction is expected to close early in the first quarter of 2018. The transaction is now expected to close on January 19, 2018. The transaction is expected to be slightly dilutive to First Reliance's 2018 tangible book value per share, including one-time transaction costs, and double-digit accretive to First Reliance's fully diluted earnings per share for 2018. Michael P. Corso of Hovde Group, LLC acted as lead financial advisor and Joseph D. Clark of Haynsworth Sinkler Boyd, P.A. acted as legal advisor to First Reliance. FIG Partners received a fee of $0.1 million from Independence upon delivery of the fairness opinion and will be entitled to an additional fee of $0.2 million if the merger closes. Benjamin A. Barnhill of Nelson Mullins Riley &Scarborough, LLP acted as legal advisor to Independence Bancshares. Laurel Hill Advisory Group, LLC acted as an information agent and was paid $6,500 as solicitation fee. First Reliance Bancshares, Inc. (OTCBB:FSRL) completed the acquisition of Independence Bancshares, Inc. (OTCPK:IEBS) on January 23, 2018.