Eau Claire, Wis.-based Citizens Community Bancorp Inc. on May 30 entered into a subordinated note purchase agreement with EJF Debt Opportunities Master Fund LP.
Under the agreement, EJF will buy the company's 6.75% fixed-to-floating subordinated notes in the aggregate principal amount of $15 million. The agreement provides funding between July 1 and July 31.
The notes will mature 10 years from the date of issuance and will bear an annual interest rate of 6.75% for the first five years, after which the interest rate will be reset quarterly, equal to three-month LIBOR plus 490 basis points.
Also on the same day, Memphis-based First Tennessee Bank NA agreed to terminate an undrawn $3 million revolving line of credit with Citizens Community. First Tennessee then extended a $5 million term loan facility to Citizens Community to help finance its pending deal with Wells, Minn.-based Wells Financial Corp. The company pledged all of unit Citizens Community Federal NA's outstanding common shares as collateral.
The agreement provides for funding no later than Sept. 30 and a floating interest rate that is London Interbank Offered Rate plus 270 basis points to be reset quarterly, with the maturity date set five years from closing.