Item 1.01.
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Entry into a Material Definitive Agreement.
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Underwriting Agreement
On September 27, 2016, Lakeland Bancorp, Inc. (the Company) entered into an underwriting agreement (the Underwriting
Agreement) with Keefe, Bruyette & Woods, Inc., as Representative of the Underwriters named therein, with respect to the sale of $75,000,000 of the Companys 5.125% Fixed-to-Floating Rate Subordinated Notes due September 30,
2026 (the Notes).
The Underwriting Agreement includes customary representations, warranties and covenants by the Company.
These representations, warranties and covenants are not representations of factual information to investors about the Company or its subsidiaries, and the sale of the Notes is not a representation that there has not been any change in the condition
of the Company. The Company also agreed to indemnify the Underwriters against certain liabilities under the Securities Act of 1933, as amended (the Securities Act).
Indenture and First Supplemental Indenture
The terms of the Notes are governed by the Indenture, dated as of September 30, 2016 (the Indenture), between the Company and
U.S. Bank National Association, as trustee (the Trustee), as amended and supplemented by the First Supplemental Indenture, dated as of September 30, 2016 (the First Supplemental Indenture), entered into between the
Company and the Trustee.
Subordinated Notes
The Notes were offered pursuant to a prospectus supplement, dated September 27, 2016 (the prospectus supplement), to the
prospectus, dated April 22, 2015, filed as part of the Registration Statement on Form S-3 (File No. 333-203408) originally filed with the Securities and Exchange Commission under the Securities Act on April 14, 2015, and declared
effective on April 22, 2015.
The offering of the Notes closed on September 30, 2016. The net proceeds from the sale of the
Notes to the Company were approximately $73.6 million, after giving effect to the underwriting discount of 1.25% and estimated expenses of the offering of the Notes. The Company intends to use these net proceeds for general corporate purposes and
investments in Lakeland Bank, the Companys wholly-owned subsidiary (the Bank), as regulatory capital.
The terms of the
Notes are set forth in the First Supplemental Indenture. The Notes will bear interest at 5.125% annually from, and including, the date of initial issuance to, but excluding, September 30, 2021, payable semi-annually in arrears. From and
including September 30, 2021 through maturity or earlier redemption, the interest rate shall reset quarterly to an interest rate per annum equal to the then current three-month LIBOR rate plus 397 basis points (3.97%), payable quarterly in
arrears.
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Interest on the Notes will be paid on March 31 and September 30 commencing
March 31, 2017 to but not including September 30, 2021, and from and including September 30, 2021, on March 31, June 30, September 30 and December 31 of each year through the stated maturity date,
unless in any case previously redeemed.
The Notes are unsecured, subordinated and (i) rank junior in right of payment and upon the
Companys liquidation to any existing and all future senior indebtedness (as defined in the First Supplemental Indenture and described under Description of the Notes in the prospectus supplement), (ii) rank equally
in right of payment and upon the Companys liquidation with any future unsecured indebtedness the terms of which provide that such indebtedness ranks equally with the Notes, and (iii) rank senior in right of payment and upon the
Companys liquidation to any indebtedness the terms of which provide that such indebtedness ranks junior to the Notes. In addition, the Notes will be effectively subordinated to all of the Companys secured indebtedness to the extent of
the value of the assets securing such indebtedness and will be effectively subordinated to all of the existing and future indebtedness, deposits and other liabilities and preferred equity of the Bank, and the Companys other current and future
subsidiaries, including, without limitation, the Banks liabilities to its depositors, liabilities to general creditors and liabilities arising in the ordinary course or otherwise.
The foregoing summaries of the Underwriting Agreement, the Indenture, the First Supplemental Indenture and the Notes are not complete and are
each qualified in their entirety by reference to the complete text of the respective documents, which are filed as Exhibits 1.1, 4.1, 4.2 and 4.3, respectively, to this Current Report on Form 8-K and are incorporated herein by reference in their
entirety.