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| MCBC > SEC Filings for MCBC > Form 8-K on 2-Jul-2009 | All Recent SEC Filings |
2-Jul-2009
Entry into a Material Definitive Agreement, Creation of a Direct Financial Obl
Private Offering
On June 30, 2009, Macatawa Bank Corporation (the "Company") entered into Subscription and Purchase Agreements, each dated as of June 30, 2009, with several accredited investors, under which the Company agreed to issue 183,333 shares of its common stock at $3.00 per share, for the aggregate purchase price of $550,000 (the "Common Subscription Agreements").
On June 30, 2009, the Company also entered into Subscription and Purchase Agreements, each dated as of June 30, 2009, with several accredited investors (together with the common stock investors, the "Stock Investors") under which the Company agreed to issue 2,350 shares of its Series B Noncumulative Convertible Perpetual Preferred Stock at $1,000 per share, for the aggregate purchase price of $2,350,000 (the "Preferred Subscription Agreements").
On June 30, 2009, the Company entered into Subscription and Purchase Agreements dated June 30, 2009 (the "Notes Subscription Agreements"), with a certain number of the Stock Investors and other accredited investors (collectively, the "Note Investors"), under which the Company agreed to issue 11% Subordinated Notes Due 2017 of the Company (the "Notes") in the aggregate principal amount of $950,000. The Notes are not convertible into common stock or preferred stock.
The sale to the Stock Investors and the Note Investors, along with the Company's previously disclosed June 5, 2009, sale of $1,000,000 in common stock to a single accredited investor (collectively, the "Private Offering"), is being made as a private placement exempt from the registration requirements of the Securities Act of 1933, as amended, pursuant to an exemption under Section 4(2) thereof, and Rule 506 of Regulation D promulgated thereunder.
Terms of the Series B Preferred Stock
In connection with the Private Offering, the Company established a newly authorized series of preferred stock, designated as Series B Noncumulative Convertible Perpetual Preferred Stock (the "Series B Preferred Stock"). The Company filed the Certificate of Designations for the Series B Preferred Stock (the "Certificate of Designations") with the State of Michigan on June 29, 2009, which sets forth the preferences, limitations, voting powers and relative rights of the Series B Preferred Stock, and is attached hereto as Exhibit 4.1.
Dividends on the Series B Preferred Stock are payable quarterly in arrears if, when and as declared by the Company's Board of Directors, at a rate of 9.00% per year on the liquidation preference of $1,000 per share. Dividends on the Series B Preferred Stock will be non-cumulative. If the Company's Board of Directors or any duly authorized committee thereof does not declare a dividend on the Series B Preferred Stock for any dividend period prior to the related dividend payment date, that dividend will not accrue, and the Company will have no obligation to pay, and holders shall have no right to receive, a dividend for that dividend period on the related dividend payment date or at any future time, whether or not dividends on the Series B Preferred Stock or any other series of preferred stock or common stock are declared for any subsequent dividend period with respect to Series B Preferred Stock, junior stock or any other class or series of authorized preferred stock of the Company. With certain limited exceptions, if the Company does not pay full cash dividends on the Series B Preferred Stock for the most recently completed dividend period, the Company may not pay dividends on, make any distributions relating to, or redeem, purchase, acquire or make a liquidation payment relating to its common stock or other stock ranking equally with or junior to the Series B Preferred Stock. The Series B Preferred Stock is not redeemable by the holders or the Company.
As discussed under Item 1.01 above, on June 30, 2009, in connection with the execution of the Notes Subscription Agreements, the Company issued 11% Subordinated Notes Due 2017 in the aggregate principal amount of $950,000. The applicable terms of the Notes are more fully described in Item 1.01 above, and are contained in the Form of 11% Subordinated Note Due 2017 attached hereto as Exhibit 4.2.
As discussed under Item 1.01 above, on June 30, 2009, in connection with the execution of the Preferred Subscription Agreements, the Company sold 2,350 shares of Series B Preferred Stock to the Stock Investors at a purchase price of $1,000 per share. Additionally, on June 30, 2009, in connection with the execution of the Common Subscription Agreements, the Company sold 183,333 shares of its common stock to the Stock Investors at a purchase price of $3.00 per share. The combined aggregate offering price of the common stock and the Series B preferred Stock was $2,900,000. The common stock and the Series B Preferred Stock was offered and sold to the Stock Investors in reliance upon an exemption for sales of securities not involving a public offering, as set forth in Section 4(2) of the Securities Act of 1933, as amended, and Rule 506 of Regulation D promulgated thereunder. The Company received an appropriate representation as to the accredited investor status (as defined in Rule 501 of Regulation D) of each Stock Investor purchasing the common stock or the Series B Preferred Stock, and no offers or sales were effected through any general solicitation or general advertising within the meaning of Rule 502(c) of Regulation D, and the Company received appropriate representations that the shares were acquired for investment purposes and not with a view to distribution. The shares that were sold have not been registered under the Securities Act of 1933, as amended, and may not be sold in the United States absent registration or an applicable exemption from the registration requirements.
As part of the Private Offering, the Company issued 2,350 shares of its Series B Preferred Stock. The holders of the Series B Preferred Stock have preferential dividend and liquidation rights over the holders of the Company's common stock. Further, the Company's ability to declare or pay dividends with respect to, or to redeem, purchase or make a liquidation payment with respect to the Company's common stock is limited by the terms of the Series B Preferred Stock. The applicable terms and preferences attached to the Series B Preferred Stock are more fully described in Item 1.01 above, and are contained in the Certificate of Designations attached hereto as Exhibit 4.1.
The above summary is qualified in its entirety by reference to the Certificate of Designations attached hereto as Exhibit 4.1.
On June 29, 2009, the Company filed the Certificate of Designations with the State of Michigan for the purpose of establishing the preferences, limitations, voting powers and relative rights of the Series B Preferred Stock. The Certificate of Designations became effective with the State of Michigan upon filing.
The applicable terms and preferences attached to the Series B Preferred Stock are more fully described in Item 1.01 above, and are contained in the Certificate of Designations. This description is qualified in its entirety by reference to the copy of the Certificate of Designations, which is attached hereto as Exhibit 4.1.
(d) Exhibits
4.1 Certificate of Designations of Macatawa Bank Corporation filed on June 29, 2009 with the State of Michigan designating the preferences, limitations, voting powers and relative rights of the Series B Preferred Stock.
4.2 Form of 11% Subordinated Notes Due 2017
10.1 Form of Subscription and Purchase Agreement for the Series B Preferred Stock between Macatawa Bank Corporation and the Stock Investor parties thereto.
10.2 Form of Subscription and Purchase Agreement for the Notes between Macatawa Bank Corporation and the Notes Investor parties thereto.
10.3 Form of Subscription and Purchase Agreement for the Common Stock between Macatawa Bank Corporation and the Stock Investor parties thereto.
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