LYONS — Lyons Bancorp Inc., the parent financial holding company for Lyons National Bank, has completed the sale of approximately $16 million of subordinated promissory notes to accredited investors.
The notes are dated Oct. 23, 2020. They mature Dec. 31, 2027. The interest rate is fixed at 4.25% for the first five years, increases to 4.75% in the sixth year, and rises again to 5.25% in the seventh year. The company retains the right to redeem the notes any time on or after Dec. 31, 2025.
Lyons Bancorp intends to use the proceeds from the sale of the notes for general corporate purposes, to provide capital to support organic growth of the bank, and to fund possible acquisitions. The net proceeds of the sale, after deducting estimated offering expenses, are expected to be $15.7 million.
The sale of the notes was made in a private placement to accredited investors under the exemption from registration provided under Securities and Exchange Commission Rule 506. The notes are not registered under the Securities Act of 1933 and may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.