Capital expected to allow the bank to
reposition business lines, support organic growth and further
enhance capital levels of the core community bank
CHARLOTTESVILLE, Va. ,
Dec. 22,
2023 /PRNewswire/ -- Blue Ridge Bankshares, Inc. (the
"Company" or "Blue Ridge") (NYSE
American: BRBS), the holding company of Blue Ridge Bank, National
Association ("Blue Ridge Bank") and BRB Financial Group, Inc. ("BRB
Financial Group"), has entered into definitive securities purchase
agreements to issue gross proceeds of $
150,000,000 of Blue Ridge's
common stock (the "Private Placement"). The Private Placement is
subject to customary closing conditions including required
regulatory and shareholder approvals.
Blue Ridge intends to use the
capital to help propel its near-term strategic initiatives, which
include repositioning business lines, supporting organic growth and
further enhancing the core community bank's capital levels,
including complying with the bank's previously disclosed individual
minimum capital ratios. President and CEO, G. William "Billy" Beale
added, "We are delighted to welcome our new shareholders and
additional investment from current shareholders. This transaction
represents a significant step for our Virginia-based community bank to build a
stronger platform for growth and shareholder value."
The Private Placement
Pursuant to the agreements, the Company will issue 60 million
new common shares at a price of $2.50
per share, and approximately 29.4 million warrants to purchase
common stock of Blue Ridge with a
strike price equal to $2.50 per
share.
The Private Placement is being led by Kenneth R. Lehman, a private investor with many
years of experience investing in banks, with participation from
Castle Creek Capital Partners VIII L.P. ("Castle Creek"), other new
and existing institutional investors, and Blue Ridge directors and officers.
Upon consummation of the Private Placement, Mr. Lehman will own
approximately 25% of Blue Ridge's
pro forma outstanding common stock and Castle Creek will own
approximately 12.5%. No new investors other than Mr. Lehman and
Castle Creek will own in excess of 9.9% of the common equity of the
pro forma Company.
Following the closing of the Private Placement, the Company, Mr.
Lehman and Castle Creek plan to identify certain criticized assets
and develop an Asset Resolution Plan. The Asset Resolution Plan
will provide a work-out strategy for identified assets for
subsequent disposition, work-out, upgrade, or other resolution.
Following the closing of the Private Placement, up to three new
investor appointed representatives are expected to join the Board
of Directors of Blue Ridge and
Blue Ridge Bank.
Advisors on the Offering
Piper Sandler & Co. is acting
as sole placement agent for the Private Placement. Williams Mullen is serving as legal counsel to
the Company, and Troutman Pepper Hamilton
Sanders, LLP is serving as legal counsel to the placement
agent. Fenimore Kay Harrison LLP is serving as legal counsel to Mr.
Lehman, and Sidley Austin LLP is serving as legal counsel to Castle
Creek.
Forward-Looking Statements
This release of Blue Ridge Bankshares, Inc. contains
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. These forward-looking
statements represent plans, estimates, objectives, goals,
guidelines, expectations, intentions, projections, and statements
of the Company's beliefs concerning future events, business plans,
objectives, expected operating results and the assumptions upon
which those statements are based. Forward-looking statements
include, without limitation, any statement that may predict,
forecast, indicate, or imply future results, performance or
achievements, and are typically identified with words such as
"may," "could," "should," "will," "would," "believe," "anticipate,"
"estimate," "expect," "aim," "intend," "plan," or words or phases
of similar meaning. The Company cautions that the
forward-looking statements are based largely on its expectations
and are subject to a number of known and unknown risks and
uncertainties that are subject to change based on factors which
are, in many instances, beyond the Company's control. Actual
results, performance or achievements could differ materially from
those contemplated, expressed or implied by the forward-looking
statements.
The following factors, among others, could cause the Company's
financial performance to differ materially from that expressed in
such forward-looking statements: (i) the strength of the United States economy in general and the
strength of the local economies in which the Company conducts
operations; (ii) geopolitical conditions, including acts or threats
of terrorism and/or military conflicts, or actions taken by
the United States or other
governments in response to acts or threats of terrorism and/or
military conflicts, which could impact business and economic
conditions in the United States
and abroad; (iii) the residual effects of the COVID-19 pandemic on
the Company and its customers, including impacts related to the
macroeconomic environment, financial market conditions, consumer
behavior and business practices; (iv) the occurrence of significant
natural disasters, including severe weather conditions, floods,
health related issues, and other catastrophic events; (v) the
Company's management of risks inherent in its loan portfolio, the
credit quality of its borrowers, and the risk of a prolonged
downturn in the real estate market, which could impair the value of
the Company's collateral and its ability to sell collateral upon
any foreclosure; (vi) changes in consumer spending and savings
habits; (vii) deposit out flows; (viii) technological and social
media changes; (ix) the effects of, and changes in, trade, monetary
and fiscal policies and laws, including interest rate policies of
the Board of Governors of the Federal Reserve System, inflation,
interest rate, market and monetary fluctuations; (x) changing bank
regulatory conditions, policies or programs, whether arising as new
legislation or regulatory initiatives, that could lead to
restrictions on activities of banks generally, or Blue Ridge Bank,
N.A. in particular, more restrictive regulatory capital
requirements, increased costs, including deposit insurance
premiums, regulation or prohibition of certain income producing
activities or changes in the secondary market for loans and other
products; (xi) the impact of changes in financial services
policies, laws, and regulations, including laws, regulations and
policies concerning taxes, banking, securities and insurance, and
the application thereof by regulatory bodies; (xii) the impact of,
and the ability to comply with, the terms of the formal written
agreement between Blue Ridge Bank and the Office of the Comptroller
of the Currency (the "OCC") and other regulatory directives and the
imposition of additional regulatory restrictions or actions for any
noncompliance; (xiii) the impact of changes in laws, regulations,
and policies affecting the real estate industry; (xiv) the effect
of changes in accounting policies and practices, as may be adopted
from time to time by bank regulatory agencies, the Securities and
Exchange Commission (the "SEC"), the Public Company Accounting
Oversight Board, the Financial Accounting Standards Board or other
accounting standards setting bodies; (xv) the timely development of
competitive new products and services and the acceptance of these
products and services by new and existing customers; (xvi) the
willingness of users to substitute competitors' products and
services for the Company's products and services; (xvii) the
outcome of any legal proceedings that may be instituted against the
Company; (xviii) reputational risk and potential adverse reactions
of the Company's customers, suppliers, employees, or other business
partners; (xix) the ability to maintain adequate liquidity by
retaining deposit customers and secondary funding sources,
especially if the Company's or industry's reputation become
damaged; (xx) maintaining capital levels adequate to support the
Company's business and to remain well-capitalized under regulatory
standards; (xxi) the effects of acquisitions the Company may make,
including, without limitation, the failure to achieve the expected
revenue growth and/or expense savings from such transactions;
(xxii) changes in the level of the Company's nonperforming assets
and charge-offs; (xxiii) the Company's involvement, from time to
time, in legal proceedings and examination and remedial actions by
regulators; (xxiv) adverse developments in the financial industry
generally, such as recent bank failures, responsive measures to
mitigate and manage such developments, related supervisory and
regulatory actions and costs, and related impacts on customer and
client behavior; (xxv) potential exposure to fraud,
negligence, computer theft, and cyber-crime; (xxvi) the Company's
ability to pay dividends; (xxvii) the ability to manage the
Company's fintech relationships, including implementing enhanced
controls and maintaining deposit levels and the quality of loans
associated with these relationships; (xxviii) the Company's
involvement as a participating lender in the Paycheck Protection
Program as administered through the U.S. Small Business
Administration; (xxix) the Company's ability to satisfy the
conditions to closing of, and consummate, the Private Placement;
and (xxx) other risks and factors identified in the "Risk Factors"
and "Management's Discussion and Results of Operations" sections
and elsewhere in the Company's Annual Report on Form 10-K for the
year ended December 31, 2022, as
amended, the Company's Quarterly Report on Form 10-Q for the most
recently ended fiscal quarter and in filings the Company makes from
time to time with the SEC.
The foregoing factors should not be considered exhaustive and
should be read together with other cautionary statements that are
included in filings the Company makes from time to time with the
SEC. Any one of these risks or factors could have a material
adverse impact on the Company's results of operations or financial
condition, or cause the Company's actual results, performance or
achievements to differ materially from those expressed in, or
implied by, forward-looking information and statements contained in
this release. Moreover, new risks and uncertainties emerge
from time to time, and it is not possible for the Company to
predict all risks and uncertainties that could have an impact on
its forward-looking statements. Therefore, the Company
cautions not to place undue reliance on its forward-looking
information and statements, which speak only as of the date of this
release. The Company does not undertake to, and will not,
update or revise these forward-looking statements after the date
hereof, whether as a result of new information, future events, or
otherwise.
Important Information about the Transactions and Where to
Find It
Blue Ridge intends to file a
proxy statement with the SEC that will be sent to the shareholders
of Blue Ridge seeking their
approval of the transactions described herein. Security
holders are urged to read the proxy statement when it becomes
available (and any other relevant documents filed with the SEC in
connection with the transactions described herein) because such
documents will contain important information regarding Blue Ridge, the transactions, certain
investors in the transactions, and related matters.
Security holders may obtain free copies of these documents, once
they are filed, and other documents filed with the SEC by
Blue Ridge through the website
maintained by the SEC at http://www.sec.gov. Investors and security
holders will also be able to obtain these documents, once they are
filed, free of charge, by requesting them in writing from G.
William Beale, Blue Ridge
Bankshares, Inc., 1807 Seminole Trail, Charlottesville, Virginia 22901, or by
telephone at (540) 743-6521. Blue
Ridge and its directors and executive officers may be deemed
to be participants in the solicitation of proxies from the
shareholders of Blue Ridge.
Information about the directors and executive officers of
Blue Ridge and their ownership of
Blue Ridge's common stock is set
forth in Blue Ridge's proxy
statement in connection with its 2023 annual meeting of
shareholders, as previously filed with the SEC on April 28, 2023.
Certain investments discussed above involve the sale of
securities in private transactions that will not be registered
under the Securities Act of 1933, as amended, and will be subject
to the resale restrictions under that Act. Such securities
may not be offered or sold absent registration or an applicable
exemption from registration. This news release does not
constitute an offer to sell or a solicitation of an offer to buy
any securities, nor shall there be any sale of securities in any
state or jurisdiction in which such an offer, solicitation or sale
would be unlawful prior to registration or qualification under the
securities laws of any such state or jurisdiction.
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SOURCE Blue Ridge Bankshares, Inc.