By Angela McDaniels
Tacoma, Wash., Dec. 17 - Heritage Commerce Corp. filed an S-3 registration with the Securities and Exchange Commission that will allow the U.S. Treasury to resell the $40 million series A fixed-rate cumulative perpetual preferred stock it purchased from the bank.
The company issued the preferreds on Nov. 21 under the Capital Purchase Program of the Treasury's Trouble Asset Relief Program.
The non-voting preferreds pay dividends at 5% per year for the first five years and then at 9% per year.
The preferreds are callable at par beginning Feb. 15, 2012. Heritage can call them earlier if it raises at least $10 million of proceeds from one or more equity offerings.
As long as the preferreds remain outstanding, Heritage cannot pay cash dividends on its common stock or junior stock unless all dividends on the preferreds have been paid in full - dividends payable in stock are allowed - and Heritage cannot repurchase preferreds from any other holder unless it offers to purchase the same amount from the Treasury.
Warrant
The shelf filing also covers a 10-year warrant for the purchase of 462,963 shares of common stock. The exercise price is $12.96 per share.
If Heritage raises at least $40 million of equity capital by Dec. 31, 2009 and the Treasury is still the holder of the warrant, then the number of shares of Heritage common stock underlying the warrant will be reduced by half.
The company said the Treasury may offer the preferreds or the warrant from time to time in one or more public or private transactions. Heritage will not receive any proceeds from any sale.
Heritage is a San Jose, Calif.-based bank holding company.
| Issuer: | Heritage Commerce Corp.
|
| Issue: | Series A fixed-rate cumulative perpetual preferred stock
|
| Amount: | $40 million
|
| Maturity: | Perpetual
|
| Dividends: | 5% for five years, then 9%; payable quarterly
|
| Price: | $1,000
|
| Call option: | At par from Feb. 15, 2012 onward
|
| Warrant: | For 462,963 shares of common stock
|
| Warrant exercise price: | $12.96
|
| Warrant expiration: | Nov. 21, 2018
|
© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere.
For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.
