By Susanna Moon
Chicago, Sept. 5 - Taylor Capital Group, Inc. said it entered into definitive agreements with investors for a private placement of $60 million of non-cumulative convertible preferred stock by Taylor Capital Group and $60 million of subordinated debt by Cole Taylor Bank.
Taylor will issue 2.4 million preferred shares at $25.00 each. The preferreds pay dividends quarterly at an annual rate of 8% and are convertible into 6 million common shares at $10.00 per share.
The conversion price is 118% of the company's stock price (Nasdaq: TAYC) of $8.50 at close July 25, the trading day before the public announcement of the letter of intent.
The company may convert the preferreds into common stock after five years. The right to dividends at the stated rate could cease after two years if the company's stock reaches specified levels, according to a press release.
Investors in the preferred sale include Harrison I. Steans, Jennifer W. Steans, the Taylor family, several members of Cole Taylor Bank's management and a number of Chicago-based investment firms and individuals.
Proceeds will be used to fund the company's strategic growth initiative and to strengthen the balance sheet and regulatory capital. The deal is expected to close by the end of September.
The subordinated notes will bear interest at 10% per year and will mature in eight years.
The notes are pre-payable at the Bank's option after three years.
With the notes, investors also will receive warrants to purchase 900,000 shares exercisable at $10.00 each for five years. Warrants will not be exercisable until the later of 180 days after issue or the date of the stockholder meeting.
Taylor Capital is the Rosemont, Ill.-based holding company for Cole Taylor Bank, primary engaged in commercial banking.
| Issuer: | Taylor Capital Group, Inc.
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| Issue: | Subordinated notes; non-cumulative convertible preferred stock
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| Amount: | $120 million
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| Investors: | Harrison I. Steans, Jennifer W. Steans and Taylor family
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| Pricing date: | July 25
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| Stock symbol: | Nasdaq: TAYC
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| Stock price: | $8.50 at close July 25
|
|
|
| Notes
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| Amount: | $60 million
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| Coupon: | 10%
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| Maturity: | Eight years
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| Price: | Par
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| Warrants: | For 900,000 shares
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| Warrant expiration: | Five years
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| Warrant strike price: | $10.00
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|
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| Convertible preferred stock
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| Amount: | $60 million
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| Shares: | 2.4 million
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| Price: | $25.00
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| Dividend: | 8%
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| Price: | Par
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| Conversion price: | $10.00
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