The First Bancshares, Inc. Announces Completion of $65 Million Subordinated Notes Offering
The First Bancshares, Inc. (NASDAQ: FBMS) (“First Bancshares” or the “Company”), the holding company for The First, A National Banking Association, announced today the completion of a private placement of $65 million of its 4.25% fixed to floating rate subordinated notes due 2030 (the “Notes”) to certain qualified institutional buyers.
The Notes are unsecured and have a ten-year term, maturing October 1, 2030, and will bear interest at a fixed annual rate of 4.25%, payable semi-annually in arrears, for the first five years of the term. Thereafter, the interest rate will reset quarterly to an interest rate per annum equal to a benchmark rate (which is expected to be Three-Month Term SOFR) plus 412.6 basis points, payable quarterly in arrears. First Bancshares is entitled to redeem the Notes, in whole or in part, on any interest payment date on or after October 1, 2025, and to redeem the Notes at any time in whole upon certain other specified events. Kroll Bond Rating Agency assigned an investment grade rating of BBB- to the Notes.
The Notes have been structured to qualify as Tier 2 capital for First Bancshares for regulatory capital purposes. First Bancshares intends to use the net proceeds from the offering for general corporate purposes.
In connection with the issuance and sale of the Notes, the Company entered into a registration rights agreement with the purchasers of the Notes pursuant to which the Company has agreed to take certain actions to provide for the exchange of the Notes for subordinated notes that are registered under the Securities Act of 1933, as amended (the “Securities Act”), with substantially the same terms as the Notes.
Keefe, Bruyette and Woods, Inc., A Stifel Company served as lead placement agent for this offering and Janney Montgomery Scott LLC and Hovde Group, LLC served as co-placement agents. Alston & Bird LLP served as legal counsel to First Bancshares and Hunton Andrews Kurth LLP served as legal counsel to the placement agents.
This press release is for informational purposes only and does not constitute an offer to sell or a solicitation to buy any securities. The offering of the Notes in the private placement was not registered under the Securities Act, or any state securities law, and the Notes may not be offered or sold in the United States absent registration, or applicable exemption from registration, under the Securities Act and applicable state securities laws.