UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM
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CURRENT REPORT
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On September 14, 2020, QCR Holdings, Inc. (the "Company") entered into a Subordinated Note Purchase Agreement (the "Purchase Agreement") with Modern Woodmen of America, an Illinois fraternal benefit society (the "Purchaser") pursuant to which the Company sold and issued $50.0 million in aggregate principal amount of its 5.125% fixed-to-floating rate subordinated notes due 2030 (the "Notes"). The Notes were issued by the Company to the Purchaser at a price equal to 100% of their face amount. The Company intends to use the net proceeds it received from the sale of the Notes to support organic growth and for general corporate purposes. The Purchase Agreement contains certain customary representations, warranties and covenants made by the Company, on the one hand, and the Purchaser, on the other hand.
The Notes have a stated maturity of September 15, 2030, are redeemable by the Company at its option, in whole or in part, on or after September 15, 2025, and at any time upon the occurrences of certain events. Prior to September 15, 2025, the Company may redeem the Notes, in whole but not in part, only under certain limited circumstances set forth in the Note. On or after September 15, 2025, the Company may redeem the Notes, in whole or in part, at its option, on any interest payment date. Any redemption by the Company would be at a redemption price equal to 100% of the principal amount of the Notes being redeemed, together with any accrued and unpaid interest on the Notes being redeemed to but excluding the date of redemption. The Notes are not subject to redemption at the option of the holder.
The Notes will bear interest at a fixed rate of 5.125% per year, from and including September 14, 2020 to, but excluding, September 15, 2025 or earlier redemption date. From and including September 15, 2025 to, but excluding the maturity date or earlier redemption date, the interest rate will reset quarterly at a variable rate, which is expected to be the then current three-month term SOFR, plus 500 basis points. As provided in the Notes, the interest rate on the Notes during the applicable floating rate period may be determined based on a rate other than three-month term SOFR.
Principal and interest on the Notes are subject to acceleration only in limited circumstances. The Notes are unsecured, subordinated obligations of the Company, are not obligations of, and are not guaranteed by, any subsidiary of the Company, and rank junior in right of payment to the Company's current and future senior indebtedness. The Notes are intended to qualify as Tier 2 capital of the Company for regulatory capital purposes.
The Notes were offered and sold by the Company in a private placement transaction in reliance upon exemptions from registration available under Section 4(a)(2) of the Securities Act of 1933, as amended (the "Securities Act"). The Notes are not subject to any sinking fund and are not convertible into or exchangeable for any other securities or assets of the Company or any of its subsidiaries.
The form of the Note and the form of the Purchase Agreement are attached as Exhibits 4.1 and 10.1, respectively, to this Current Report on Form 8-K and are incorporated herein by reference. The foregoing descriptions of the Purchase Agreement and the Notes are summaries and are qualified in their entirety by reference to the full text of such documents.
The information set forth under Item 1.01 above is incorporated by reference into this Item 2.03.
On September 14, 2020, the Company issued a press release announcing the completion of the offering of the Notes, a copy of which is furnished herewith as Exhibit 99.1.
The information contained in this Item 7.01 and Exhibit 99.1 shall not be deemed to be "filed" for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise subject to the liabilities of such section, nor will such information be deemed incorporated by reference in any filing under the Securities Act or the Exchange Act, except as may be expressly set forth by specific reference in such filing.
(d) Exhibits.
| Exhibit No. | Description | |||
| 4.1 | Form of 5.125% Fixed-to-Floating Rate Subordinated Note due 2030 (included as Exhibit A to the Subordinated Note Purchase Agreement filed as Exhibit 10.1 hereto). | |||
| 10.1 | Form of Subordinated Note Purchase Agreement, dated September 14, 2020, by and between QCR Holdings, Inc. and Modern Woodmen of America. | |||
| 99.1 | Press Release of QCR Holdings, Inc., dated September 14, 2020. | |||
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| QCR Holdings, Inc. | ||
| Date: September 14, 2020 | By: | /s/ Todd A. Gipple |
| Todd A. Gipple | ||
| President, Chief Operating Officer and Chief Financial Officer | ||