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Old Second terminates exchange offer for $31.6 million 7.8% securities
By Susanna Moon
Chicago, Aug. 20 - Old Second Bancorp, Inc. said it terminated the offer to exchange a portion of the $31.6 million outstanding liquidation amount of 7.8% capital securities issued by Old Second Capital Trust I for newly issued common shares.
The company's board of directors decided that completing the exchange offer would not be in the best interest of the company and its stockholders due to the high level of dilution stockholders would experience, according to a company press release.
Old Second noted that its stock has continued to trade at prices lower than those at the beginning of the offer. The company extended the offer on July 30 due, in part, to the decline in the stock price.
For each $10.00 liquidation amount of securities, Old Second had planned to issue a number of common shares equal to $7.50 divided by the average volume-weighted average price of common shares for the five consecutive trading days ending the second trading day immediately preceding the expiration date of the exchange offer. This was a 26.1% premium over the last reported sales price of the securities on Nasdaq before the offer began.
The company previously said the offer was one component of a multi-faceted capital strategy to strengthen its capital position. The board continues to evaluate the company's overall capital strategy and explore all available alternatives, the release noted.
The offer began on June 22 and was scheduled to expire on Aug. 23.
D.F. King & Co., Inc. (800 628-8536 or 212 269-5550 for bankers and brokers) was the exchange agent.
Old Second is an Aurora, Ill., bank holding company.
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