ALTAVISTA, Va., Sept. 21, 2020 (GLOBE NEWSWIRE) -- Pinnacle Bankshares Corporation (OTCQX: PPBN) (“Pinnacle” or the “Company”), the holding company for First National Bank, today announced that it has completed a private placement of $8.0 million in fixed-to-floating rate subordinated notes due 2030 (the “Notes”). The Notes have been structured to qualify as Tier 2 capital under bank regulatory guidelines, and the proceeds from the sale of the Notes will be utilized to pay a portion of the cash consideration to be paid by the Company in connection with its pending merger with Virginia Bank Bankshares, Inc., if consummated, and to provide optionality for various growth opportunities and for general corporate purposes. In connection with the Notes offering, the Company was advised by Performance Trust Capital Partners, LLC as placement agent and Troutman Pepper Hamilton Sanders LLP as legal counsel. Wyrick Robbins Yates & Ponton LLP served as legal counsel to the placement agent.
The Notes will initially bear interest at 5.25% per annum, beginning September 18, 2020 to but excluding September 30, 2025, payable quarterly in arrears. From September 30, 2025 to but excluding September 30, 2030, or up to an early redemption date, the interest rate shall reset quarterly to an interest rate per annum equal to the then current three-month SOFR plus 513 basis points, payable quarterly in arrears. Beginning on September 30, 2025 through maturity, the Notes may be redeemed, at the Company’s option and subject to any required regulatory approval, on any scheduled interest payment date. The Notes will mature on September 30, 2030.
The Notes have not been registered under the Securities Act of 1933, as amended, or any state securities laws and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements. This press release does not constitute an offer to sell, or the solicitation of an offer to buy, any security.
“We are pleased with the positive response to Pinnacle Bankshares Corporation’s subordinated notes offering, which positions us to move forward with our strategic partnership with Virginia Bank Bankshares, Inc.,” stated Aubrey H. Hall, III, President and Chief Executive Officer for both the Company and its wholly-owned subsidiary, First National Bank. Mr. Hall further commented, “We are excited about our Company’s future and the steps being taken to ensure long-term viability while enhancing shareholder value.”
About Pinnacle
Pinnacle Bankshares Corporation is a locally managed community banking organization based in Central Virginia. The one-bank holding company of First National Bank serves an area consisting primarily of all or portions of the Counties of Campbell, Pittsylvania, Bedford, Amherst, and the Cities of Lynchburg and Charlottesville. The Company has a total of ten branches with two located in the Town of Altavista, where the Bank was founded. Other branch locations include Village Highway in Rustburg, Wards Road near the Lynchburg Regional Airport, Timberlake Road in Campbell County, South Main Street in the Town of Amherst, Old Forest Road, Odd Fellows Road and Main Street in the City of Lynchburg and Forest Road in Bedford County. Additionally, the Company operates a loan production office located in Charlottesville and plans to open another branch in the Graves Mill Center located in Forest once the impacts of the COVID-19 pandemic subside. First National Bank is in its 112th year of operation.
Caution Regarding Forward-Looking Statements
This press release may contain “forward-looking statements” within the meaning of federal securities laws. Forward-looking statements in this press release include, but are not limited to, statements regarding the future use of the proceeds from the sale of the Notes, the qualification of the Notes as Tier 2 capital under bank regulatory guidelines and other statements in the press release that are not historical facts. Words such as “anticipates,” “believes,” “projects,” “potential,” “intends,” “should,” “expects,” “will,” “may,” and variations of similar expressions often accompany forward-looking statements. These statements are based on the beliefs of Pinnacle’s management as to the expected outcome of future events as of the date hereof and are not guarantees of future performance. These statements involve certain risks, uncertainties and assumptions that are difficult to predict with regard to timing, extent, and degree of occurrence. Results and outcomes may differ materially from what may be expressed or forecasted in or implied by forward-looking statements. Factors that could cause results and outcomes to differ materially include, among others, disruptions to customer and employee relationships and business operations caused by the ongoing COVID-19 pandemic; changes in local and national economies, or market conditions; changes in interest rates, such as volatility in yields on U.S. Treasury bonds and increases or volatility in mortgage rates; regulations and accounting principles; changes in policies or guidelines; loan demand and asset quality, including real estate values and collateral values; deposit flow; the impact of competition from traditional or new sources, and the other factors.
Forward-looking statements speak only as of the date of this press release. All of the forward-looking statements made in this press release are expressly qualified by the cautionary statements contained herein. Readers are cautioned not to rely on the forward-looking statements contained in this press release, as no assurance can be given that any of the events anticipated by the forward-looking statements will occur or, if any of them do occur, their ultimate impact on the results of operations or financial condition of Pinnacle.
Contact
Pinnacle Bankshares Corporation
Aubrey H. “Todd” Hall, III, President and Chief Executive Officer
434-369-3000 or toddhall@1stnatbk.com