By Lisa Kerner
Charlotte, N.C., Nov. 5 – First National Corp. issued $5 million of 6.75% subordinated notes due 2025 to Community Funding CLO, Ltd. on Oct. 30, according to an 8-K filed with the Securities and Exchange Commission.
Proceeds, along with existing cash, will be used by First National to redeem all 13,900 shares of its series A preferred stock at par for $13.9 million and all 695 shares of series B preferred stock at par for $695,000 on Dec. 2. Both the series A and series B preferred stock have a 9% dividend rate and were issued to the Department of the Treasury under the TARP Capital Purchase Program.
First National may repay the notes in full on or after Oct. 1, 2020.
The notes will be an unsecured, subordinated obligation of the company and will rank junior in right of payment to the company’s senior debt.
Based in Strasburg, Va., First National is the holding company of First Bank.
| Issuer: | First National Corp.
|
| Issue: | Subordinated notes
|
| Amount: | $5 million
|
| Coupon: | 6.75%
|
| Maturity: | Oct. 1, 2025
|
| Call option: | Beginning Oct. 1, 2020
|
| Settlement date: | Oct. 30
|
| Purchaser: | Community Funding CLO, Ltd.
|
| Distribution: | Private placement
|
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