Endeavor Bancorp, a wholly-owned subsidiary of Endeavor Bank (“Bank”) (OTC Pink: EDVR), announced today that it had successfully issued $15,000,000 in subordinated debt in an institutional private placement. Performance Trust Capital Partners, LLC acted as placement agent. Breakwater Law Group, LLP served as counsel to Endeavor Bancorp, and Hunton Andrews Kurth LLP served as counsel to Performance Trust Capital Partners, LLC.
The net proceeds of the debt will be retained by Endeavor Bancorp for the time being after payment of operational expenses. Endeavor Bancorp is expected to become the bank holding company for the Bank, subject to receipt of shareholder and regulatory approvals. Assuming this occurs, Endeavor Bancorp is expected to use the funds for general corporate purposes. The debt is guaranteed by the Bank, but the Bank will be released from its guaranty when Endeavor Bancorp becomes the bank holding company for the Bank.
Principal is due on March 15, 2032, and the debt is not redeemable until March 15, 2027, except on the occurrence of certain specified events. Interest only is payable in arrears prior to the due date, every six months during the fixed interest rate period and quarterly thereafter. The interest rate is fixed until March 15, 2027 at 5.00%, and thereafter floats based on the Three-Month Term SOFR (provided, however, that in the event Three-Month Term SOFR is less than zero, Three-Month Term SOFR shall be deemed zero) plus 344 basis points.
CEO Dan Yates commented, “We are pleased to have the opportunity to increase our capital, at favorable terms for all of our stakeholders. This new sub-debt will increase our legal lending limit to enable us to better serve borrowers. The Bank is currently well capitalized, and when Endeavor Bancorp becomes our bank holding company, the sub-debt will help us to remain well capitalized as we continue to implement our growth strategy.”