UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
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Securities Exchange Act of 1934
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| Item 1.01. | Entry into a Material Definitive Agreement. |
On April 20, 2021, Western New England Bancorp, Inc. (“WNEB” or the “Company”) entered into a Subordinated Note Purchase Agreement (the “Purchase Agreement”) with certain qualified institutional buyers (the “Purchasers”) pursuant to which the Company issued and sold, at 100% of their principal amount, $20 million aggregate principal amount of the Company’s 4.875% fixed-to-floating rate subordinated notes due 2031 (the “Notes”).
The Notes have a stated maturity of May 1, 2031, and bear interest (i) at a fixed rate of 4.875% per year, from and including the original issue date to but excluding May 1, 2026 or the earlier redemption date, computed on the basis of a 360-day year consisting of twelve 30-day months, payable quarterly in arrears on May 1, August 1, November 1 and February 1 of each year, beginning August 1, 2021 and (ii) from and including May 1, 2026 to but excluding the maturity date or earlier redemption date, at a floating interest rate per year, reset quarterly, equal to the benchmark rate, which is the 90-day average secured overnight financing rate, plus 412 basis points determined on the determination date of the applicable interest period, computed on the basis of a 360-day year and the actual number of day elapsed, payable quarterly in arrears on May 1, August 1, November 1 and February 1 of each year. The Notes are redeemable, in whole or in part, on or after May 1, 2026, and at any time upon the occurrence of certain events.
The Purchase Agreement contains customary representations, warranties and covenants made by the Company, on the one hand, and the Purchasers, severally and not jointly, on the other hand. The Notes were offered and sold by the Company to eligible purchasers in a private offering in reliance on the exemption from the registration requirements of Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”) and the provisions of Rule 506 of Regulation D thereunder.
The Purchase Agreement is attached as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated herein by reference. The description herein of the Purchase Agreement is a summary and is qualified in its entirety by reference to the form of the Purchase Agreement.
The payment of the principal on the Notes may only be accelerated upon the occurrence of certain bankruptcy or receivership related events relating to the Company or a major subsidiary depository institution of the Company, in which case, the principal of all of the Notes shall become due and payable.
The Company expects to use the net proceeds of the offering for general corporate purposes, including funding organic growth and the repurchase of the Company’s common stock.
This description of the Notes does not purport to be complete and is qualified in its entirety by reference to the form of Subordinated Note which is attached as Exhibit 4.1 hereto and is incorporated herein by reference. A copy of the press release announcing the foregoing is attached as Exhibit 99.1 hereto and is incorporated herein by reference.
| Item 2.03. | Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. |
The information set forth in Item 1.01 above is incorporated by reference into this Item 2.03.
| Item 8.01. | Other Events. |
In connection with the closing of the Offering, the Company issued a press release pursuant to Rule 135c under the Securities Act. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
| Item 9.01. | Financial Statements and Exhibits. |
(d) Exhibits.
The exhibits required by this item are set forth on the Exhibit Index attached hereto.
|
Exhibit Number |
Description | |
| 4.1 | Form of 4.875% Fixed-to-Floating Subordinated Note due 2031 (included as Exhibit A to the Purchase Agreement filed as Exhibit 10.1 hereto). | |
| 10.1 | Form of Subordinated Note Purchase Agreement, dated April 20, 2021, by and among Western New England Bancorp, Inc. and the Purchasers identified therein. | |
| 99.1 | Press Release of Western New England Bancorp, Inc. dated April 20, 2021. | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| WEST | WESTERN NEW ENGLAND BANCORP, INC. | |
| Date: April 20, 2021 | By: | /s/ Guida R. Sajdak |
| Guida R. Sajdak | ||
| Chief Financial Officer | ||