Heartland BancCorp Announces Completion of $25 Million Subordinated Notes Offering

WHITEHALL, Ohio, May 15, 2020 (GLOBE NEWSWIRE) -- Heartland BancCorp (“the Company” or “Heartland”) (OTCQX: HLAN) today announced the completion of its private placement of $25 million of 5.0% fixed-to-floating rate subordinated notes due 2030 (the “Notes”) to certain qualified institutional buyers and accredited investors, including the exchange of approximately $5.4 million of the Company’s subordinated promissory notes due 2025. The Notes will initially bear interest at a fixed annual rate of 5.0%, payable semiannually in arrears, to, but excluding, June 15, 2025, and will reset quarterly thereafter to the then current three-month SOFR plus a spread of 490.0 basis points, payable quarterly in arrears, commencing September 15, 2025. Heartland may redeem the Notes on or after June 15, 2025, or at any time upon certain other specified events. The Notes have been structured to qualify as Tier 2 capital for Heartland for regulatory capital purposes. Heartland intends to use the net proceeds of the offering for general corporate purposes, including repaying indebtedness, to support organic growth and to fund potential acquisitions.

“This successful capital raise gives us an opportunity to build out our business plan and is an affirmation of Heartland’s tremendous opportunities in our market,” stated G. Scott McComb, Chairman and Chief Executive Officer. “Through the issuance of these Notes, we have cost effectively increased our capital levels without diluting our current shareholders.”

D.A. Davidson & Co. acted as placement agent for the offering. Hunton Andrews Kurth LLP served as legal counsel to Heartland, and Squire Patton Boggs (US) LLP served as legal counsel to D.A. Davidson & Co. 

This press release is for informational purposes only and shall not constitute an offer to sell, or the solicitation of an offer to buy, any security, nor shall there by any sale in any jurisdiction in which such an offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of such jurisdiction. The Notes have not been registered under the Securities Act of 1933, as amended, and may not be offered or sold absent registration or an applicable exemption from the registration requirements. The indebtedness evidenced by the Notes is not a deposit and is not insured by the Federal Deposit Insurance Corporation or any other government agency or fund.

About Heartland BancCorp

Heartland BancCorp is a registered Ohio bank holding company and the parent of Heartland Bank, which operates 19 full-service banking offices, and TransCounty Title Agency, LLC. Heartland Bank, founded in 1911, provides full-service commercial, small business, and consumer banking services; professional financial planning services; and other financial products and services. Heartland Bank is a member of the Federal Reserve, a member of the FDIC, and an Equal Housing Lender. Heartland BancCorp is currently quoted on the OTC Markets (OTCQX) under the symbol HLAN. Learn more about Heartland Bank at Heartland.Bank.

In May 2020, Heartland was ranked #58 on the American Banker Magazine’s list of Top 200 Publicly Traded Community Banks and Thrifts based on three-year average return on equity (“ROE”) as of December 31, 2019. In September 2019, Heartland common stock uplisted to the OTCQX® Best Market after previously trading on the OTCQB® Venture Market.

Safe Harbor Statement

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, statements about (i) the use of proceeds from the offering; (ii) Heartland Bank’s plans, objectives, expectations and intentions and other statements contained in this press release that are not historical facts; and (iii) other statements identified by words such as “expects,” “anticipates,” “intends,” “plans,” “believes,” “seeks,” “estimates,” “targets,” “projects,” or words of similar meaning generally intended to identify forward-looking statements. These forward-looking statements are based upon the current beliefs and expectations of Heartland’s management and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond the control of Heartland. In addition, these forward-looking statements are subject to assumptions with respect to future business strategies and decisions that are subject to change. Actual results may differ materially from the anticipated results discussed in these forward-looking statements because of the following factors, among others,: (1) legislative or regulatory changes, including changes in accounting standards, may adversely affect the businesses in which Heartland is engaged; (2) changes in the interest rate environment may adversely affect net interest income; (3) results may be adversely affected by continued diversification of assets and adverse changes to credit quality; (4) competition from other financial services companies in Heartland Bank’s markets could adversely affect operations; (5) the coronavirus (COVID-19) pandemic may impact the employees and customers of Heartland Bank and thus affect the business, financial condition and results of operations of Heartland Bank; and (6) the economy could experience a slowdown that could adversely affect credit quality and loan originations.

Heartland cautions that the foregoing list of factors is not exclusive. All subsequent written and oral forward-looking statements are expressly qualified in their entirety by the cautionary statements above. Heartland does not undertake any obligation to update any forward-looking statement to reflect circumstances or events that occur after the date the forward-looking statements are made, except as required by law.

Contacts:     G. Scott McComb, Chairman & CEO

                    Heartland BancCorp   614-337-4600