UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported) October 21, 2004
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Horizon Bancorp
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(Exact Name of Registrant as Specified in Its Charter)
Indiana 000-10792 35-1562417
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(State or Other Jurisdiction of Incorporation) (Commission File Number) (IRS Employer Identification No.)
515 Franklin Square, Michigan City, Indiana 46360
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(Address of Principal Executive Offices) (Zip Code)
(219) 879-0211
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(Registrant's Telephone Number, Including Area Code)
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(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities Act
(17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17
CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
ITEM 1.01. ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT AND
ITEM 2.03. CREATION OF A DIRECT FINANCIAL OBLIGATION OR AN OBLIGATION UNDER AN
OFF-BALANCE SHEET ARRANGEMENT OF A REGISTRANT
INTRODUCTION
On October 21, 2004, Horizon Bancorp ("Horizon") entered into several
agreements providing for the private placement of $10,000,000 in Floating Rate
Preferred Securities (the "Preferred Securities"). The Preferred Securities were
issued by Horizon's newly formed Delaware trust subsidiary, Horizon Bancorp
Capital Trust II (the "Trust"), to NBC Capital Markets Group, Inc. (the
"Purchaser"). The proceeds of the Preferred Securities sale were used by the
Trust to purchase Floating Rate Subordinated Debt Securities (the "Debentures")
from Horizon pursuant to an Indenture (the "Indenture") between Horizon and
Wilmington Trust Company as trustee (the "Trustee").
The Preferred Securities will mature in 30 years and initially bear
interest at the rate of 4.05% per annum. The rate will adjust quarterly to
three-month LIBOR plus 1.95%. Interest on the Preferred Securities is payable
quarterly in arrears each February 23, May 23, August 23 and November 23.
Horizon may redeem the trust preferred securities, in whole or in part, on or
after November 23, 2009, or earlier upon the occurrence of certain events.
The proceeds of the offering qualify as Tier 1 capital for bank regulatory
purposes, up to 25% of total Tier 1 capital. Any amounts that do not qualify as
Tier 1 capital will qualify as Tier 2 capital. Horizon expects to use the net
proceeds from the offering for general corporate purposes, including providing
funding for new market expansion and leveraging the additional Tier 1 capital
through expansion of its investment portfolio.
The principal agreements Horizon entered into in connection with this
transaction are briefly described below.
PLACEMENT AGREEMENT
Horizon and the Trust entered into a Placement Agreement (the "Placement
Agreement") with Sandler O'Neill & Partners, L.P. ("Sandler O'Neill"), which
provided Sandler O'Neill with the exclusive right to sell the Preferred
Securities to the Purchaser for $10,000,000. No commission or placement fee was
paid by Horizon or the Trust to Sandler O'Neill for its services under the
Placement Agreement.
The Placement Agreement contains certain customary representations and
warranties of Horizon and the Trust which survive the initial sale of the
Preferred Securities. The Placement Agreement also provides for indemnification
of Sandler O'Neill, the Purchaser and each of their affiliates against specified
losses, claims, damages and liabilities related to the transaction.
AMENDED AND RESTATED DECLARATION OF TRUST
The Amended and Restated Declaration of Trust (the "Declaration of Trust")
describes the rights and obligations of Horizon, as the holder of all of the
common securities of the Trust (the "Common Securities"), and the rights and
obligations of the holders of the Preferred Securities. The Declaration of Trust
provides for distributions to be paid on the Preferred Securities and the Common
Securities, based on the liquidation amount of the outstanding Preferred and
Common Securities, at the same rates and times as interest is payable on the
Debentures. As a result, distributions will only be paid with respect to the
Preferred Securities if
Horizon makes the corresponding interest payment with respect to the Debentures.
Maturity, redemption, and acceleration features for the Preferred Securities are
the same as those of the Debentures.
Under the Indenture (described below), Horizon has the option, as long as
it is not in default under the Indenture, at any time, to defer the payment of
interest on the Debentures for up to twenty consecutive quarterly interest
payment periods. If payments are deferred on the Debentures, the distributions
required to be made with respect to the Preferred Securities will also be
deferred. During any such deferral period, or while an event of default exists
under the Indenture, Horizon will be subject to various restrictions which are
described below with respect to the Indenture.
Payment of distributions with respect to the Common Securities is
subordinated to the payment of such amounts on the Preferred Securities.
INDENTURE
The Indenture describes the rights and obligations of the Trust and the
Trustee, as the holder of all of the Debentures, and certain rights and
obligations of the holders of the Preferred Securities. The Debentures bear
interest at the same rate as the Preferred Securities, and interest is payable
on the same dates as interest is payable with respect to the Preferred
Securities.
Under the Indenture, Horizon has the option, as long as it is not in
default under the Indenture, at any time and from time to time, to defer the
payment of interest on the Debentures for up to twenty consecutive quarterly
interest payment periods. During any such deferral period, or while an event of
default exists under the Indenture, Horizon may not declare or pay dividends or
distributions on, redeem, or make a liquidation payment with respect to, any of
its capital stock, or make payments of principal, interest or premium on, or
repay or repurchase, any other debt securities that rank equal or junior to the
Debentures.
The Debentures mature 30 years after their date of issuance, and can be
redeemed in whole or in part by Horizon, at any time after November 23, 2009.
Horizon may also redeem the Debentures upon the occurrence of a "capital
disqualification event," an "investment company event" or a "tax event" as
defined in the Indenture. The payment of principal and interest on the
Debentures is subordinate and subject to the right of payment of all "Senior
Indebtedness" of Horizon as described in the Indenture.
GUARANTEE AGREEMENT
Horizon, as Guarantor, entered into a Guarantee Agreement with Wilmington
Trust Company, as Guarantor Trustee, for the benefit of the holders of the
Preferred Securities. Pursuant to the Guarantee Agreement, Horizon
unconditionally agreed to pay to the holders of the Preferred Securities all
amounts becoming due and payable with respect to the Preferred Securities, to
the extent that the Trust has funds available for such payment at the time.
Horizon's guarantee obligation under the Guarantee Agreement is a general
unsecured obligation of Horizon and is subordinate and junior in right of
payment to all of Horizon's Senior Indebtedness.
The Guarantee Agreement also requires Horizon to indemnify and hold
harmless the Guarantee Trustee from losses, damages, and other liabilities in
connection with its service as Guarantee Trustee. In the event Horizon elects to
defer payments with respect to the Debentures,
or while an event of default exists under the Guarantee Agreement, Horizon will
be subject to the same restrictions which arise in similar situations under the
Declaration of Trust.
PRESS RELEASE
On October 22, 2004, Horizon issued a press release regarding the issuance
of the Preferred Securities. A copy of the press release is filed as Exhibit
99.1 to this report.
ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.
(C) EXHIBITS
EXHIBIT NO. DESCRIPTION
1.1 Placement Agreement, dated October 21, 2004, among Horizon Bancorp,
Horizon Bancorp Capital Trust II and Sandler O'Neill & Partners,
L.P.
4.1 Indenture, dated as of October 21, 2004, between Horizon Bancorp
and Wilmington Trust Company.
4.2 Amended and Restated Declaration of Trust of Horizon Bancorp
Capital Trust II, dated as of October 21, 2004.
10.1 Guarantee Agreement of Horizon Bancorp, dated as of October 21,
2004.
99.1 Press Release issued October 22, 2004, regarding issuance of
floating rate preferred securities.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereto duly authorized.
Date: October 26, 2004 Horizon Bancorp
By: /s/ James H. Foglesong,
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James H. Foglesong,
Chief Financial Officer
EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION LOCATION
1.1 Placement Agreement, dated October 21, 2004, among Horizon Bancorp, Attached
Horizon Bancorp Capital Trust II and Sandler O'Neill & Partners, L.P.
4.1 Indenture, dated as of October 21, 2004, between Horizon Bancorp and Attached
Wilmington Trust Company.
4.2 Amended and Restated Declaration of Trust of Horizon Bancorp Capital Attached
Trust II, dated as of October 21, 2004.
10.1 Guarantee Agreement of Horizon Bancorp, dated as of October 21, 2004. Attached
99.1 Press Release issued October 22, 2004, regarding issuance of floating Attached
rate preferred securities.