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Section 1: 8-K (8-K)

gnty-8k_20200501.htm

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 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):

 

May 01, 2020

 

 

GUARANTY BANCSHARES, INC.

(Exact name of registrant as specified in its charter)

 

 

 

Texas

001-38087

75-1656431

(State or Other Jurisdiction of Incorporation)

(Commission File Number)

(IRS Employer Identification No.)

16475 Dallas Parkway, Suite 600

Addison, Texas

 

75001

(Address of Principal Executive Offices)

 

(Zip Code)

 

Registrant’s Telephone Number, Including Area Code: (888) 572-9881

 

Not Applicable

(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))

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

 

Trading symbol

 

Name of each exchange on which registered

Common Stock, par value $1.00 per share

 

GNTY

 

NASDAQ Global Select Market

 

 

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

 

Emerging growth company

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

 


 


 

Item 1.01. Entry into a Material Definitive Agreement.

On April 30, 2020, Guaranty Bancshares, Inc., a Texas corporation (the “Company”), entered into Subordinated Note Purchase Agreements (the “Purchase Agreements”) with certain private investors (the “Purchasers”) pursuant to which the Company sold and issued $10,000,000 in aggregate principal Junior Subordinated Debentures (the “Debentures”). The Debentures were issued by the Company to the Purchasers at a price equal to 100% of their face amount. The Debentures were offered and sold by the Company to the Purchasers in a private offering in reliance on the exemptions from registration available under Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”), and the provisions of Regulation D thereunder (the “Private Placement”). The Company intends to use the net proceeds of the offering for general corporate purposes, including to replenish cash that was used to repurchase shares of capital stock in the first quarter of 2020.

The Debentures have stated maturity dates between November 1, 2020 and November 1, 2024, and bear interest at fixed annual rates between 1.00% and 4.00%. The Company will pay interest semi-annually on May 1st and November 1st in arrears during the term of the Debentures.

The Debentures are redeemable by the Company at its option, in whole in or part, at any time and from time to time, at an amount equal to 100% of the outstanding principal amount being redeemed plus accrued but unpaid interest, to but excluding the redemption date, but in all cases in a principal amount with integral multiples of $1,000.

The Purchase Agreements contains certain customary representations, warranties, and covenants made by the Company, on the one hand, and the Purchasers, on the other hand. The Debentures are not subject to any sinking fund and are not convertible into or exchangeable for any other securities or assets of the Company or any of its subsidiaries. The Debentures are not subject to redemption at the option of the holders. The Debentures are unsecured, subordinated obligations of the Company and generally rank junior in right to payment to all senior indebtedness of the Company, whether now outstanding or subsequently created, assumed, or incurred, and rank senior to the Company’s existing junior subordinated debentures underlying outstanding trust preferred securities and any other indebtedness that is expressly made junior in right of payment to the Debentures. The Debentures are the obligations of the Company only and are not obligations of, and are not guaranteed by, any of the Company’s subsidiaries including Guaranty Bank & Trust, N.A.

The description of the Purchase Agreements contained herein is a summary and is qualified in its entirety by reference to the Purchase Agreement filed as Exhibit 10.1 to this Current Report on Form 8-K.

The description of the Debentures contained herein is a summary and is qualified in its entirety by reference to the form of Note filed as Exhibit 4.1 to this Current Report on Form 8-K.

Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

The information set forth under Item 1.01 above is incorporated by reference into this Item 2.03.

Item 9.01. Financial Statements and Exhibits.

Exhibits.

The following is furnished as an exhibit to this Current Report on Form 8-K:

 

 

Exhibit No.

Description of Exhibit

4.1

Form of Subordinated Note

10.1

Subordinated Note Purchase Agreement, by and between Guaranty Bancshares, Inc. and the Purchasers


 


 

Forward-Looking Statements

This Current Report on Form 8-K may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Exchange Act and the Private Securities Litigation Reform Act of 1995. Forward-looking statements are subject to risks and uncertainties and are based on potentially inaccurate assumptions that could cause actual results to differ materially from those expected or implied by the forward-looking statements. Actual results may differ materially from the results predicted and reported results should not be considered as an indication of future performance. The potential risks and uncertainties that could cause actual results to differ from the results predicted include, among others, those risks and uncertainties included under the caption “Risk Factors” and elsewhere in our filings with the U.S. Securities and Exchange Commission, including, without limitation, the Annual Report on Form 10-K filed with the SEC on March 13, 2020 and the Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2020 filed on April 20, 2020 with the SEC.  All information provided in this Current Report on Form 8-K is as of the date hereof, and we undertake no duty to update this information unless required by law.


 


 

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 hereunto duly authorized.

 

Dated: May 01, 2020

 

 

 

GUARANTY BANCSHARES, INC.

 

 

 

 

 

 

By:

 

/s/ Tyson T. Abston

Name:

 

Tyson T. Abston

Title:

 

Chairman of the Board and Chief Executive Officer

 

 

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Section 2: EX-4.1 (EX-4.1 - FORM OF DEBENTURE)

gnty-ex41_7.htm

EXHIBIT 4.1

GUARANTY BANCSHARES, INC.

[]% JUNIOR SUBORDINATED DEBENTURE DUE [] [], 20[]

THE INDEBTEDNESS EVIDENCED BY THIS DEBENTURE IS NOT A DEPOSIT AND IS NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENT AGENCY OR FUND.

THE INDEBTEDNESS EVIDENCED BY THIS DEBENTURE IS SUBORDINATED AND JUNIOR IN RIGHT OF PAYMENT TO SENIOR INDEBTEDNESS (AS DEFINED IN SECTION 2(b) OF THIS DEBENTURE) OF GUARANTY BANCSHARES, INC. (THE “COMPANY”), INCLUDING OBLIGATIONS OF THE COMPANY TO ITS GENERAL AND SECURED CREDITORS, AND IS UNSECURED. IT IS INELIGIBLE AS COLLATERAL FOR ANY EXTENSION OF CREDIT BY THE COMPANY OR ANY OF ITS SUBSIDIARIES. THE DEBENTURES SHALL BE EFFECTIVELY SUBORDINATE TO SECURED INDEBTEDNESS OF THE COMPANY TO THE EXTENT OF THE VALUE OF THE ASSETS SECURING SUCH INDEBTEDNESS AND ARE STRUCTURALLY SUBORDINATE TO DEPOSITS AND LIABILITIES OF GUARANTY BANK & TRUST (THE “BANK”). IT IS INELIGIBLE AS COLLATERAL FOR ANY EXTENSION OF CREDIT BY THE COMPANY OR ANY OF ITS SUBSIDIARIES.

IN THE EVENT OF LIQUIDATION, ALL HOLDERS OF SENIOR INDEBTEDNESS OF THE COMPANY SHALL BE ENTITLED TO BE PAID IN FULL WITH SUCH INTEREST AS MAY BE PROVIDED BY LAW BEFORE ANY PAYMENT SHALL BE MADE ON ACCOUNT OF PRINCIPAL OF OR INTEREST ON THIS DEBENTURE. AFTER PAYMENT IN FULL OF ALL SUMS OWING TO SUCH HOLDERS OF SENIOR INDEBTEDNESS, THE HOLDER OF THIS DEBENTURE, TOGETHER WITH THE HOLDERS OF ANY OBLIGATIONS OF THE COMPANY RANKING ON A PARITY WITH THIS DEBENTURE, SHALL BE ENTITLED TO BE PAID FROM THE REMAINING ASSETS OF THE COMPANY THE UNPAID PRINCIPAL AMOUNT OF THIS DEBENTURE PLUS ACCRUED AND UNPAID INTEREST THEREON BEFORE ANY PAYMENT OR OTHER DISTRIBUTION, WHETHER IN CASH, PROPERTY OR OTHERWISE, SHALL BE MADE (I) WITH RESPECT TO ANY OBLIGATION THAT BY ITS TERMS EXPRESSLY IS JUNIOR TO IN THE RIGHT OF PAYMENT TO THIS DEBENTURE, (II) WITH RESPECT TO THE EXISTING JUNIOR SUBORDINATED DEBENTURES OF THE COMPANY (UNDERLYING THE OUTSTANDING TRUST PREFERRED SECURITIES) AS OF THE DATE OF THE ISSUANCE OF THIS DEBENTURE TO WHICH THIS DEBENTURE SHALL BE SENIOR, OR (III) WITH RESPECT TO ANY INDEBTEDNESS BETWEEN THE COMPANY AND ANY OF ITS SUBSIDIARIES OR AFFILIATES OR (IV) ON ACCOUNT OF ANY SHARES OF CAPITAL STOCK OF THE COMPANY.

THIS DEBENTURE WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN MINIMUM DENOMINATIONS OF $100,000 AND MULTIPLES OF $1,000 IN EXCESS THEREOF. ANY ATTEMPTED TRANSFER OF THIS DEBENTURE IN A DENOMINATION OF LESS THAN $1,000 SHALL BE DEEMED TO BE VOID AND OF NO LEGAL EFFECT WHATSOEVER. ANY SUCH PURPORTED TRANSFEREE SHALL BE DEEMED NOT TO BE THE HOLDER OF THIS DEBENTURE FOR ANY PURPOSE, INCLUDING, BUT NOT

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EXHIBIT 4.1

LIMITED TO, THE RECEIPT OF PAYMENTS ON THIS DEBENTURE, AND SUCH PURPORTED TRANSFEREE SHALL BE DEEMED TO HAVE NO INTEREST WHATSOEVER IN THIS DEBENTURE.

THIS DEBENTURE MAY BE SOLD ONLY IN COMPLIANCE WITH APPLICABLE FEDERAL AND STATE SECURITIES LAWS. THIS DEBENTURE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS, OR ANY OTHER APPLICABLE SECURITIES LAWS. NEITHER THIS DEBENTURE NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.

CERTAIN ERISA CONSIDERATIONS:

THE HOLDER OF THIS DEBENTURE, OR ANY INTEREST HEREIN, BY ITS ACCEPTANCE HEREOF OR THEREOF AGREES, REPRESENTS AND WARRANTS THAT IT IS NOT AN EMPLOYEE BENEFIT PLAN, INDIVIDUAL RETIREMENT ACCOUNT OR OTHER PLAN OR ARRANGEMENT SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”), OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”) (EACH, A “PLAN”), OR AN ENTITY WHOSE UNDERLYING ASSETS INCLUDE “PLAN ASSETS” BY REASON OF ANY PLAN’S INVESTMENT IN THE ENTITY, AND NO PERSON INVESTING “PLAN ASSETS” OF ANY PLAN MAY ACQUIRE OR HOLD THIS DEBENTURE OR ANY INTEREST HEREIN, UNLESS SUCH PURCHASER OR HOLDER IS ELIGIBLE FOR THE EXEMPTIVE RELIEF AVAILABLE UNDER U.S. DEPARTMENT OF LABOR PROHIBITED TRANSACTION CLASS EXEMPTION 96-23, 95-60, 91-38, 90-1 OR 84-14 OR ANOTHER APPLICABLE EXEMPTION OR ITS PURCHASE AND HOLDING OF THIS DEBENTURE, OR ANY INTEREST HEREIN, ARE NOT PROHIBITED BY SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE WITH RESPECT TO SUCH PURCHASE AND HOLDING. ANY PURCHASER OR HOLDER OF THIS DEBENTURE OR ANY INTEREST HEREIN WILL BE DEEMED TO HAVE REPRESENTED BY ITS PURCHASE AND HOLDING THEREOF THAT EITHER: (I) IT IS NOT AN EMPLOYEE BENEFIT PLAN OR OTHER PLAN TO WHICH TITLE I OF ERISA OR SECTION 4975 OF THE CODE IS APPLICABLE, A TRUSTEE OR OTHER PERSON ACTING ON BEHALF OF ANY SUCH EMPLOYEE BENEFIT PLAN OR OTHER PLAN, OR ANY OTHER PERSON OR ENTITY USING THE “PLAN ASSETS” OF ANY SUCH PLAN OR OTHER PLAN TO FINANCE SUCH PURCHASE OR (II) SUCH PURCHASE OR HOLDING WILL NOT RESULT IN A PROHIBITED TRANSACTION UNDER SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE FOR WHICH FULL EXEMPTIVE RELIEF IS NOT AVAILABLE UNDER APPLICABLE STATUTORY OR ADMINISTRATIVE EXEMPTION.

ANY FIDUCIARY OF ANY PLAN WHO IS CONSIDERING THE ACQUISITION OF THIS DEBENTURE OR ANY INTEREST HEREIN SHOULD CONSULT WITH LEGAL COUNSEL PRIOR TO ACQUIRING THIS DEBENTURE OR ANY INTEREST HEREIN.

 

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EXHIBIT 4.1

No. 2020-[●]

Principal Amount:  $[●]

Issue Date: [●] [●], 2020

 

GUARANTY BANCSHARES, INC.

[]% JUNIOR SUBORDINATED DEBENTURE DUE [] [], 20[]

FOR VALUE RECEIVED, the undersigned, Guaranty Bancshares, Inc., a Texas corporation (the “Company”), hereby promises to pay to the order of [], a resident of the State of [●]/a [●] corporation/limited liability company], with an address of [●], or any holder of this [●]% Junior Subordinated Debenture Due [●] [●], 20[●] (this “Debenture”) from time to time as permitted herein (the “Holder”), the principal sum of [] DOLLARS ($[]) on the terms and as provided herein.

 

1.

Payment. The Company, for value received, promises to pay to the Holder all unpaid and outstanding principal of this Debenture, plus accrued but unpaid interest, on [●] [●], 20[●] (the “Maturity Date”) and to pay interest thereon at the rate of [●]% per annum from and including the original issue date of this Debenture, or from the most recent Interest Payment Date to which interest has been paid or duly provided for, semiannually in arrears (each an “Interest Period”) on May 1 and November 1 of each year (each, an “Interest Payment Date”), commencing November 1, 2020, until the principal hereof is paid or made available for payment, with such interest calculated on the basis of a 360-day year consisting of twelve 30-day months and the number of days elapsed in any partial month. If any payment of interest or principal is not paid in full when the same becomes due and payable, then interest will be compounded quarterly. Any payment of principal of or interest on this Debenture that would otherwise become due and payable on a day which is not a Business Day shall become due and payable on the next succeeding Business Day, with the same force and effect as if made on the date for payment of such principal or interest, and no interest will accrue in respect of such payment for the period after such day. The term “Business Day” means any day other than a Saturday or Sunday or any other day on which banking institutions in the State of Texas are generally authorized or required by law or executive order to be closed.

2.

Subordination.

(a)The indebtedness of the Company evidenced by this Debenture, including the principal and interest, will be subordinate and junior in right of payment to its obligations to the holders of all Senior Indebtedness (as defined below), and such subordination is for the benefit of and enforceable by the holders of such Senior Indebtedness. In the event of any insolvency, receivership, conservatorship, reorganization, readjustment of debt, marshaling of assets and liabilities or similar proceedings or any liquidation or winding up of or relating to the Company, whether voluntary or involuntary, all Senior Indebtedness will be entitled to be paid in full before any payment will be made on account of the principal of or interest on this Debenture. In the event of any such proceedings, after payment in full of all sums owing on such prior obligations, the Holder, together with holders of any obligations of the Company ranking on a parity with this Debenture, which shall include all other subordinated debentures issued by the Company, will be

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EXHIBIT 4.1

entitled to be paid from the remaining assets of the Company the unpaid principal thereof and any interest thereon before any payment or other distribution, whether in cash, property or otherwise, will be made on account of any capital stock or any obligations of the Company ranking junior to this Debenture. Nothing herein will impair the obligation of the Company, which is absolute and unconditional, to pay the principal of and interest on this Debenture according to its terms.

(b)“Senior Indebtedness” expressly includes the indebtedness owed to Frost Bank on the Company’s $25 million line of credit (“Frost Line of Credit”) extended by Frost and reflected in that certain promissory note dated March 31, 2018,   payable to Frost in the original principal amount of $25 million and in the related loan documents executed by the Company in connection with the Frost Line of Credit, which Frost Line of Credit may be renewed, extended, increased and modified from time to time and shall at all times remain superior in priority to this Debenture. “ Senior Indebtedness” also  means and includes the principal of, and premium, if any, and interest, if any, on each of the following, whether now outstanding, or created, assumed or incurred in the future: (i) Company’s obligations for money borrowed; (ii) indebtedness of the Company evidenced by bonds, debentures, notes or similar instruments; (iii) similar obligations of the Company arising from off-balance sheet guarantees and direct credit substitutes; (iv) reimbursement obligations of the Company with respect to letters of credit, bankers’ acceptances or similar facilities; (v) obligations of the Company issued or assumed as the deferred purchase price of property or services (but excluding trade accounts payable or accrued liabilities arising in the ordinary course of business); (vi) capital lease obligations of the Company; (vii) obligations of the Company associated with derivative products including but not limited to securities contracts, foreign currency exchange contracts, swap agreements (including interest rate and foreign exchange rate swap agreements), cap agreements, floor agreements, collar agreements, interest rate agreements, foreign exchange rate agreements, options, commodity futures contracts, commodity option contracts and similar financial instruments; (viii) a deferred obligation of, or any such obligation, directly or indirectly guaranteed by, the Company which obligation is incurred in connection with the acquisition of any business, properties or assets not evidenced by a note or similar instrument given in connection therewith; (ix) debt of others described in the preceding clauses that Company has guaranteed or for which the Company is otherwise liable; and (x) the Company’s obligations to general creditors; provided, that Senior Indebtedness excludes (1) any of the foregoing if, in the instrument creating or evidencing that indebtedness, obligation or liability, or pursuant to which the same is outstanding, it is expressly provided that the indebtedness, obligation or liability is not senior in right of payment to, is junior in right of payment to or ranks equally in right of payment with, other specific types of indebtedness, obligations or liabilities of the Company that include this Debenture or other indebtedness, obligations or liabilities that rank equally with or junior to this Debenture, including, without limitation, the Company’s junior subordinated debentures owing to Guaranty (TX) Capital Trust II, Guaranty (TX) Capital Trust III and DCB Financial Trust I; (2) any indebtedness, obligation or liability that is subordinated to indebtedness, obligation or liabilities of the Company to substantially the same extent as or to a greater extent than the Debentures are subordinated; and (3) the Debentures and, unless expressly provided in the terms thereof, any indebtedness of the Company to its Subsidiaries.

 

 

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EXHIBIT 4.1

 

3.

Redemption.

(a)Right of Redemption. Subject to Section 4(e) below, this Debenture shall be redeemable at the option of and by the Company, in whole or in part at any time and from time to time, at an amount equal to 100% of the outstanding principal amount being redeemed plus accrued but unpaid interest, to but excluding the redemption date, but in all cases in a principal amount with integral multiples of $1,000. The Company will give the holder hereof notice of redemption, which notice shall indicate the aggregate principal amount of Debentures to be redeemed, if less than all, not less than 30 nor more than 45 calendar days prior to the redemption date.

(b)Partial Redemption. If less than the then outstanding principal amount of this Debenture is redeemed, (i) a new Debenture shall be issued representing the unredeemed portion without charge to the holder thereof and (ii) such redemption shall be effected on a pro rata basis as to the Holders. For purposes of clarity, upon a partial redemption, a like percentage of the principal amount of every Debenture held by every Holder shall be redeemed.

(c)No Redemption at Option of Holder. This Debenture is not subject to redemption at the option of the holder of this Debenture.

(d)Effectiveness of Redemption. If notice of redemption has been duly given and notwithstanding that this Debenture has been called for redemption but has not yet been surrendered for cancellation, on and after the date fixed for redemption interest shall cease to accrue on the portion of this Debenture called for redemption, this Debenture shall no longer be deemed outstanding with respect to the portion called for redemption and all rights with respect to the portion of this Debenture called for redemption shall forthwith on such date fixed for redemption cease and terminate unless the Company shall default in the payment of the redemption price, except only the right of the holder hereof to receive the amount payable on such redemption, without interest.

(e)Regulatory Approvals. Any such redemption shall be subject to receipt of any and all required federal and state regulatory approvals or non-objections, including, but not limited to, the consent of the Board of Governors of the Federal Reserve System (the “Federal Reserve”).

(f)Purchase and Resale of the Debentures. Subject to any required federal and state regulatory approvals and the provisions of this Debenture, the Company shall have the right to purchase any of the Debentures at any time in the open market, private transactions or otherwise. If the Company purchases any Debentures, it may, in its discretion, hold, resell or cancel any of the purchased Debentures.

4.

Events of Default; Acceleration.

Each of the following events shall constitute an “Event of Default”:

(a)the entry of a decree or order for relief in respect of the Company by a court having jurisdiction in the premises in an involuntary case or proceeding under any applicable bankruptcy, insolvency, or reorganization law, now or hereafter in effect of the United States or

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EXHIBIT 4.1

any political subdivision thereof, and such decree or order will have continued unstayed and in effect for a period of sixty (60) consecutive days;

(b)the commencement by the Company of a voluntary case under any applicable bankruptcy, insolvency or reorganization law, now or hereafter in effect of the United States or any political subdivision thereof, or the consent by the Company to the entry of a decree or order for relief in an involuntary case or proceeding under any such law;

(c)the Company (i) becomes insolvent or is unable to pay its debts as they mature, (ii) makes an assignment for the benefit of creditors, (iii) admits in writing its inability to pay its debts as they mature or (iv) ceases to be a bank holding company under the Bank Holding Company Act of 1956, as amended;

(d)the failure of the Company to pay any installment of interest on any of the Debentures as and when the same will become due and payable, and the continuation of such failure for a period of thirty (30) days after the date on which notice specifying such failure, stating that such notice is a “Notice of Default” hereunder and demanding that the Company remedy the same, will have been given, in the manner set forth in Section 22, to the Company by a Holder;

(e)the failure of the Company to pay all or any part of the principal of any of the Debentures as and when the same will become due and payable; or

(f)the liquidation of the Company (for avoidance of doubt, “liquidation” does not include any merger, consolidation, sale of equity or assets or reorganization (exclusive of a reorganization in bankruptcy) of the Company or any of its Subsidiaries).

Unless the principal of this Debenture already shall have become due and payable, if an Event of Default shall have occurred and be continuing, the Holder, by notice in writing to the Company, may declare the principal amount of this Debenture to be due and payable immediately and, upon any such declaration the same shall become and shall be immediately due and payable. The Company waives demand, presentment for payment, notice of nonpayment, notice of protest, and all other notices. The Company, within forty-five (45) calendar days after the receipt of written notice from any Holder of the occurrence of an Event of Default with respect to this Debenture, shall mail to all Holders, at their addresses shown on the Security Register (as defined in Section 12 below), such written notice of Event of Default, unless such Event of Default shall have been cured or waived before the giving of such notice as certified by the Company in writing.

The rights and remedies provided in this Debenture are cumulative and not exclusive of any right or remedy provided by law or equity. No notice or demand on the Company in any case shall, in itself, entitle the Company to any other or further notice or demand in similar or other circumstances or constitute a waiver of the rights of the Holders to any other or further action in any circumstances without notice or demand. No consent or waiver, expressed or implied, by the Holders to or of any breach or default by the Company in the performance of its obligations hereunder shall be deemed or construed to be a consent or waiver to or of any other breach or default in the performance of the same or any other obligations of the Company hereunder. Failure on the part of the Holders to complain of any acts or failure to act or to declare an Event of Default, irrespective of how long such failure continues, shall not constitute a waiver by the Holders of

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EXHIBIT 4.1

their rights hereunder or impair any rights, powers or remedies on account of any breach or default by the Company.

10.

Payment Procedures. Payment of the principal and interest payable on the Maturity Date will be made by check, by wire transfer or by Automated Clearing House (ACH) transfer in immediately available funds to a bank account in the United States designated by the registered Holder, upon presentation and surrender of this Debenture at the Payment Office (as defined in Section 22 below) or at such other place or places as the Company shall designate by notice to the registered Holders as the Payment Office, provided that this Debenture is presented to the Company in time for the Company to make such payments in such funds in accordance with its normal procedures. Payments of interest (other than interest payable on the Maturity Date) shall be made on each Interest Payment Date by wire transfer in immediately available funds or check mailed to the registered Holder, as such person’s address appears on the Security Register. Interest payable on any Interest Payment Date shall be payable to the Holder in whose name this Debenture is registered at the close of business on the fifteenth (15th) calendar day prior to the applicable Interest Payment Date, without regard to whether such date is a Business Day (such date being referred to herein as the “Record Date”). To the extent permitted by applicable law, interest shall accrue, at the rate at which interest accrues on the principal of this Debenture, on any amount of principal or interest on this Debenture not paid when due. All payments on this Debenture shall be applied first against costs and expenses of the Holder, if any, for which the Company is liable under this Debenture; then against interest due hereunder; and then against principal due hereunder. The Holder acknowledges and agrees that the payment of all or any portion of the outstanding principal amount of this Debenture and all interest hereon shall be pari passu in right of payment and in all other respects to the other Debentures. In the event that the Holder receives payments in excess of its pro rata share of the Company’s payments to the holders of all of the Debentures, then the Holder shall hold in trust all such excess payments for the benefit of the other Holders and shall pay such amounts held in trust to such other holders upon demand by such holders.

11.

Form of Payment. Payments of principal of and interest on this Debenture shall be made in such coin or currency of the United States of America as at the time of payment shall be legal tender for the payment of public and private debts.

12.

Registration of Transfer, Security Register. Except as otherwise provided herein and in the Subordinated Debenture Purchase Agreement relating to the purchase of this Debenture (“Purchase Agreement”), this Debenture is transferable in whole or in part, and may be exchanged for a like aggregate principal amount of Debentures of other authorized denominations, by the Holder in person, or by its attorney duly authorized in writing, at the Payment Office or the offices of the Registrar. The Debentures will initially be issued in certificated form.  The Company or its agent (the “Registrar”) shall maintain a register providing for the registration of the Debentures and any exchange or transfer thereof (the “Security Register”). Upon surrender or presentation of this Debenture for exchange or registration of transfer, the Company or the Registrar shall execute and deliver in exchange therefor a Debenture or Debentures of like aggregate principal amount, each in a minimum denomination of $1,000 or any amount in excess thereof which is an integral multiple of $1,000 (and, in the absence of an opinion of counsel satisfactory to the Company to the contrary, bearing the restrictive legend(s) set forth hereinabove) and that is or are registered in such name or names requested by the Holder. Any Debenture presented or surrendered for

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EXHIBIT 4.1

registration of transfer or for exchange shall be duly endorsed and accompanied by a written instrument of transfer in such form as is attached hereto and incorporated herein, duly executed by the Holder or its attorney duly authorized in writing, with such tax identification number or other information for each person in whose name a Debenture is to be issued, and accompanied by evidence of compliance with any restrictive legend(s) appearing on such Debenture or Debentures as the Company may reasonably request to comply with applicable law. No exchange or registration of transfer of this Debenture shall be made on or after the fifteenth (15th) day immediately preceding the Maturity Date.

13.

Successors and Assigns. This Debenture shall be binding upon the Company and inure to the benefit of the Holder and its respective successors and permitted assigns. The Holder may assign all, or any part of, or any interest in, the Holder’s rights and benefits hereunder only to the extent and in the manner permitted in the Purchase Agreement. To the extent of any such assignment, such assignee shall have the same rights and benefits against the Company and shall agree to be bound by and to comply with the terms and conditions of the Purchase Agreement as it would have had if it were the Holder hereunder.

14.

Priority. This Debenture, together with all other subordinated debentures issued by the Company, rank pari passu among themselves and pari passu, in the event of any insolvency proceeding, dissolution, assignment for the benefit of creditors, reorganization, restructuring of debt, marshaling of assets and liabilities or similar proceeding or any liquidation or winding up of the Company, with all other present or future obligations of the Company ranking on a parity with the Debentures.

15.

Ownership. Prior to due presentment of this Debenture for registration of transfer, the Company may treat the holder in whose name this Debenture is registered in the Security Register as the absolute owner of this Debenture for receiving payments of principal and interest on this Debenture and for all other purposes whatsoever, whether or not this Debenture be overdue, and the Company shall not be affected by any notice to the contrary.

16.

Amendment and Waiver.

(a)This Debenture may be amended in writing executed by the Company and the Holder; this Debenture may only be waived in writing executed by the party waiving the performance of the non-waiving party. Any such consent or waiver given by the Holder shall be conclusive and binding upon such Holder and upon all subsequent holders of this Debenture and of any Debenture issued upon the registration of transfer hereof or in exchange therefor or in lieu hereof, whether or not notation of such consent or waiver is made upon this Debenture. No delay or omission of the Holder to exercise any right or remedy accruing upon any Event of Default shall impair such right or remedy or constitute a waiver of any such Event of Default or an acquiescence therein.

(b)Notwithstanding the foregoing, the Company may amend or supplement the Debentures without the consent of the Holders to cure any ambiguity, defect or inconsistency or to provide for uncertificated Debentures in addition to or in place of certificated Debentures, or to make any change that does not adversely affect the rights of any Holder of any of the Debentures.

8


EXHIBIT 4.1

17.

Absolute and Unconditional Obligation of the Company.

(a)No provisions of this Debenture shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal and interest on this Debenture at the times, places and rate, and in the coin or currency, herein prescribed.

(b)Any insured depository institution which shall be a Holder or which otherwise shall have any beneficial ownership interest in this Debenture shall, by its acceptance of such Debenture (or beneficial interest therein), be deemed to have waived any right of offset with respect to the indebtedness evidenced thereby.

20.

No Sinking Fund; Convertibility. This Debenture is not entitled to the benefit of any sinking fund. This Debenture is not convertible into or exchangeable for any of the equity securities, other securities or assets of the Company or any subsidiary of the Company.

21.

No Recourse Against Others. No recourse under or upon any obligation, covenant or agreement contained in this Debenture, or for any claim based thereon or otherwise in respect thereof, will be had against any past, present or future shareholder, employee, officer, or director, as such, of the Company or of any predecessor or successor, either directly or through the Company or any predecessor or successor, under any rule of law, statute or constitutional provision or by the enforcement of any assessment or by any legal or equitable proceeding or otherwise, all such liability being expressly waived and released by the acceptance of this Debenture by the Holder and as part of the consideration for the issuance of this Debenture.

22.

Notices. All notices to the Company under this Debenture shall be in writing and addressed to the Company at 16475 Dallas Parkway, Suite 600, Addison, Texas 75001, Attn: Chief Financial Officer, or to such other address as the Company may notify to the Holder (the “Payment Office”). All notices to the Holders shall be in writing and sent by first-class mail to each Holder at its address as set forth in the Security Register.

23.

Further Issues. The Company may, without the consent of the Holders, create and issue additional debentures having the same terms and conditions of the Debentures (except for the date of issuance and issue price) so that such further debentures shall be consolidated and form a single series with the Debentures.

24.

Governing Law; Interpretation. THIS DEBENTURE WILL BE DEEMED TO BE A CONTRACT MADE UNDER THE LAWS OF THE STATE OF TEXAS AND WILL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF TEXAS WITHOUT REGARD TO CONFLICT OF LAW PRINCIPLES THEREOF.

[Signature Page Follows]

 

 

9


EXHIBIT 4.1

IN WITNESS WHEREOF, the undersigned has caused this Debenture to be duly executed and attested.

GUARANTY BANCSHARES, INC.

By:______________________________________

Tyson T. Abston
Chairman and Chief Executive Officer

ATTEST:

__________________________________
Sondra Cunningham
Secretary

 

10

(Back To Top)

Section 3: EX-10.1 (EX-10.1 - PURCHASE AGREEMENT)

gnty-ex101_8.htm

EXHIBIT 10.1

 

50128.0001 117433v2

 

SUBORDINATED DEBENTURE PURCHASE AGREEMENT

This SUBORDINATED DEBENTURE PURCHASE AGREEMENT, dated as of April 30, 2020 (this “Agreement”), is by and among Guaranty Bancshares, Inc., a Texas corporation (the “Company”), and the purchaser of the Debenture (as defined herein) named on the signature page hereto (the “Purchaser”).

BACKGROUND

The Company intends to sell to the Purchaser, and the Purchaser intends to purchase from the Company, a junior subordinated debenture(s) evidencing unsecured subordinated debt of the Company in the original principal amount, with such maturity date and bearing interest and in an amount specified on the Purchaser’s signature page hereto  (singularly or collectively, hereafter the “Debenture”).  

NOW, THEREFORE, in consideration of the premises, and of the representations, warranties, covenants and agreements set forth herein, the parties agree as follows:

Article 1
PURCHASE; CLOSING

1.1Purchase.  On the terms and subject to the conditions set forth herein, and in consideration of Purchaser’s payment of the original principal amount set forth on Purchaser’s signature page hereto (the “Purchase Price”), Purchasers will purchase from the Company, and the Company will sell to Purchaser, the Debenture.  Purchaser agrees to purchase the Debenture from the Company on the date hereof in accordance with the terms of, and subject to the conditions and provisions set forth in, this Agreement and the Debenture.  

1.2Closing.

(a)The closing of the purchase of the Debenture by the Purchaser pursuant hereto (the “Closing”) shall occur at 10:00 a.m., Central time, on May 1, 2020, or at such later date within three days thereof as may be agreed to by the parties, at the offices of Guaranty Bank & Trust, N.A., 100 West Arkansas, Mt. Pleasant, TX 75455 or remotely via the electronic or other exchange of documents and signature pages, or such other date or location as agreed by the parties.  

(b)At the Closing:

(1)The Company will deliver to Purchaser, in a denomination equal to the Purchase Price, a Debenture duly executed by the Company; and

(2)Purchaser will deliver the Purchase Price to the Company either by (i) wire transfer; (ii) cashier’s check; or (iii) transfer from an existing Guaranty account of immediately available funds to the account provided to Purchaser by the Company.

1


EXHIBIT 10.1

 

ARTICLE 2
REPRESENTATIONS AND WARRANTIES

2.1Representations and Warranties of the Company.  The Company hereby represents and warrants to Purchaser, as of the date hereof, that:

(a)Organization and Authority.  The Company is a corporation duly organized and validly existing under the laws of the state of Texas, is duly qualified to do business and is in good standing in all jurisdictions where its ownership or leasing of property or the conduct of its business requires it to be so qualified except where any failure to be so qualified would not reasonably be expected to have, individually or in the aggregate, a material adverse effect on the Company, and has the corporate or other organizational power and authority to own its properties and assets and to carry on its business as it is now being conducted.  

(b)Authorization; No Conflicts; No Default.  The Company has the corporate power and authority to execute and deliver this Agreement and the Debenture and to perform its obligations hereunder and thereunder.  The Debenture has been duly authorized, executed and delivered by the Company and, constitutes the legal, valid and binding obligation of the Company in accordance with its terms, except as enforcement may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer and similar Laws of general applicability relating to or affecting creditors’ rights or by general equity principles (whether applied in equity or at law).

2.2Representations and Warranties of Each Purchaser.  Purchaser hereby represents and warrants to the Company, as of the date hereof, that:

(a)Authority.  

(1)Purchaser has all requisite authority (and in the case of an individual, the capacity) to purchase the Debenture, enter into this Agreement and to perform all the obligations required to be performed by Purchaser hereunder, and such purchase will not contravene any law, rule or regulation binding on Purchaser or any investment guideline or restriction applicable to Purchaser.

(2)Purchaser is a resident of the state set forth on the signature page hereto and is not acquiring the Debenture as a nominee or agent or otherwise for any other person.

(3)Purchaser will comply with all applicable laws and regulations in effect in any jurisdiction in which Purchaser purchases or sells the Debenture and obtain any consent, approval or permission required for such purchases or sales under the laws and regulations of any jurisdiction to which Purchaser is subject or in which Purchaser makes such purchases or sales, and the Company shall have no responsibility therefor.

(b)Information Concerning the Company

(1)Purchaser has not been furnished any offering materials.

2


EXHIBIT 10.1

 

(2)Purchaser understands that no public market now exists or is expected to exist for the Debenture, and that the Company has made no assurances that a public market will ever exist for the Debenture.

(3)Purchaser confirms that it is not relying on any communication (written or oral) of the Company or any of its affiliates as investment or tax advice or as a recommendation to purchase the Debenture.  It is understood that information and explanations related to the terms and conditions of the Debenture provided by the Company or any of its affiliates or representatives shall not be considered investment or tax advice or a recommendation to purchase the Debenture, and that neither the Company nor any of its affiliates or representatives is acting or has acted as an advisor to Purchaser in deciding to invest in the Debenture.  Purchaser acknowledges that neither the Company nor any of its affiliates or representatives has made any representation regarding the proper characterization of the Debenture for purposes of determining Purchaser’s authority to invest in the Debenture.

(4)Purchaser is familiar with the business and financial condition and operations of the Company.  Purchaser has had access to such information concerning the Company and the Debenture as it deems necessary to enable it to make an informed investment decision concerning the purchase of the Debenture.  Purchaser has read and understands the risk factors and other disclosures of uncertainties related to the Company set forth in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 and in its other filings with the Securities and Exchange Commission (the “Commission”).

(5)Purchaser understands that no federal or state agency has passed upon the merits or risks of an investment in the Debenture or made any finding or determination concerning the fairness or advisability of this investment.  

(c)Non-Reliance

(1)Purchaser represents that it is not relying on (and will not at any time rely on) any communication (written or oral) of the Company, as investment advice or as a recommendation to purchase the Debenture, it being understood that information and explanations related to the terms and conditions of the Debenture shall not be considered investment advice or a recommendation to purchase the Debenture.

(2)Purchaser confirms that the Company has not (i) given any guarantee or representation as to the potential success, return, effect or benefit (either legal, regulatory, tax, financial, accounting or otherwise) of an investment in the Debenture or (ii) made any representation to Purchaser regarding the legality of an investment in the Debenture under applicable legal investment or similar laws or regulations.  In deciding to purchase the Debenture, Purchaser is not relying on the advice or recommendations of the Company and Purchaser has made its own independent decision that the investment in the Debenture is suitable and appropriate for Purchaser.

3


EXHIBIT 10.1

 

(d)Status of Undersigned

(1)Purchaser has such knowledge, skill and experience in business, financial and investment matters that Purchaser is capable of evaluating the merits and risks of an investment in the Debenture.  With the assistance of Purchaser’s own professional advisors, to the extent that Purchaser has deemed appropriate, Purchaser has made its own legal, tax, accounting and financial evaluation of the merits and risks of an investment in the Debenture and the consequences of this Agreement.  Purchaser has considered the suitability of the Debenture as an investment in light of its own circumstances and financial condition and Purchaser is able to bear the risks associated with an investment in the Debenture and its authority to invest in the Debenture.  Purchaser understands that the payment on the Debenture at maturity or earlier redemption may be less, and perhaps significantly less, than the principal amount of the Debenture.

(2)Purchaser is an “accredited investor” as defined in Rule 501(a) under the Securities Act of 1933, as amended (the “Securities Act”).  Purchaser agrees to furnish any additional information requested by the Company or any of its affiliates to assure compliance with applicable U.S. federal and state securities laws in connection with the purchase and sale of the Debenture.  Purchaser has completed the Accredited Investor Questionnaire contained in Exhibit A and the information contained therein is complete and accurate as of the date hereof. Any information that has been furnished or that will be furnished by Purchaser to evidence its status as an accredited investor is accurate and complete, and does not contain any misrepresentation or material omission.

(e)Restrictions on Transfer or Sale of Debenture

(1)Purchaser is acquiring the Debenture solely for Purchaser’s own beneficial account, for investment purposes, and not with a view to, or for resale in connection with, any distribution of the Debenture.  Purchaser understands that the Debenture have not been registered under the Securities Act or any state securities laws by reason of specific exemptions under the provisions thereof which depend in part upon the investment intent of Purchaser and of the other representations made by Purchaser in this Agreement.  Purchaser understands that the Company is relying upon the representations and agreements contained in this Agreement (and any supplemental information) for the purpose of determining whether this transaction meets the requirements for such exemptions.

(2)Purchaser understands that the Debenture is a “restricted security” under applicable federal securities laws and that the Securities Act and the rules of the Commission provide in substance that Purchaser may dispose of the Debenture only pursuant to an effective registration statement under the Securities Act or an exemption therefrom; and Purchaser understands that the Company has no obligation or intention to register the Debenture, or to take action so as to permit sales pursuant to the Securities Act (including Rule 144 thereunder).  Accordingly, Purchaser understands that under the Commission’s rules, Purchaser may dispose of the Debenture principally only in a “private placement” that is exempt from registration under the Securities Act, in which event the transferee will acquire a “restricted security” subject to the same limitations as in the hands

4


EXHIBIT 10.1

 

of Purchaser.  Consequently, Purchaser understands that Purchaser must bear the economic risks of the investment in the Debenture for an indefinite period of time.

(3)Purchaser agrees:  (i) that Purchaser will not sell, assign, pledge, give, transfer or otherwise dispose of the Debenture or any interest therein, or make any offer or attempt to do any of the foregoing, except pursuant to a registration of the Debenture under the Securities Act and all applicable state securities laws, or in a transaction that is exempt from the registration provisions of the Securities Act and all applicable state securities laws; (ii) that the Debenture will bear a legend making reference to the foregoing restrictions; and (iii) that the Company and its affiliates shall not be required to give effect to any purported transfer of such Debenture except upon compliance with the foregoing restrictions.

(4)Purchaser acknowledges that neither the Company nor any other person offered to sell the Debenture to it by means of any form of general solicitation or advertising, including but not limited to: (i) any advertisement, article, notice or other communication published in any newspaper, magazine or similar media or broadcast over television or radio or (ii) any seminar or meeting whose attendees were invited by any general solicitation or general advertising.

(f)Brokers and Finders.  Purchaser has not employed any broker or finder or incurred any liability for any financial advisory fees, brokerage fees, commissions or finder’s fees, and no broker or finder has acted directly or indirectly for the Purchaser, in connection with this Agreement whose fees the Company would be required to pay.

(g)Investment Decision.  The Purchaser (1) has reached its decision to invest in the Company independently from any other Person, (2) has not entered into any agreement or understanding with any other Person to act in concert for the purpose of exercising a controlling influence over the Company of any of its subsidiaries, including any agreements or understandings regarding the voting or transfer of shares of the Company, (3) has not been induced by any other Person to enter into this Agreement, and (4) has not entered into any agreement with any other Person with respect to the its investment in the Debenture.  

(h)Ability to Bear Economic Risk of Investment.  The Purchaser recognizes that an investment in the Debenture involves substantial risk and the Purchaser has the ability to bear the economic risk of the prospective investment in the Debenture, including the ability to hold the Debenture indefinitely, and further including the ability to bear a complete loss of all of its investment in the Company.

ARTICLE 3
MISCELLANEOUS

3.1Termination.  This Agreement may be terminated, with respect to the Company or any Purchaser, prior to the Closing, (a) by mutual written agreement of the Company and the Purchaser; or (b) by the Company or the Purchaser, upon written notice to the other parties, in the event that the Closing does not occur within five (5) business days of the date of this Agreement.  In the event of any termination of this Agreement as provided in this Section 3.1, this Agreement

5


EXHIBIT 10.1

 

(other than this Article 3, which shall remain in full force and effect) shall forthwith become wholly void and of no further force and effect

3.2Survival. Each of the representations and warranties set forth in this Agreement shall survive the Closing through the maturity of the Debenture.  Except as otherwise provided herein, all covenants and agreements contained herein shall survive until, by their respective terms, they are no longer operative, other than those which by their terms are to be performed in whole or in part prior to or on the Closing Date, which shall terminate as of the Closing Date.

3.3No Control.  Purchaser agrees that it shall not, without the prior consent of the Company, contribute capital to the Company or acquire an amount of voting securities of the Company that in either case would cause such Purchaser, to be deemed to control the Company for purposes of the Bank Holding Company Act of 1956, as amended, or the Change in Bank Control Act of 1978, as amended, or applicable state Law.  

3.4Expenses.  Each of the parties will bear and pay all costs and expenses incurred by it or on its behalf in connection with the Contemplated Transactions.

3.5Amendment; Waiver.  No amendment or waiver of any provision of this Agreement will be effective with respect to any party unless made in writing and signed by an officer of a duly authorized representative of such party.  No failure or delay by any party in exercising any right, power or privilege hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege.  The conditions to each party’s obligation to consummate the Closing are for the sole benefit of such party and may be waived by such party in whole or in part to the extent permitted by applicable Law.  No waiver of any party to this Agreement will be effective unless it is in a writing signed by a duly authorized officer of the waiving party that makes express reference to the provision or provisions subject to such waiver.  The rights and remedies herein provided shall be cumulative and not exclusive of any rights or remedies provided by Law.

3.6Successors and Assigns.  In the event that either party (or successor to such party) assigns such party’s right and obligations (if any) under a Debenture to a permitted assign in accordance with the terms of such Debenture, this Agreement and such party’s rights and obligations hereunder shall be automatically assigned to and assumed by such permitted assign, without any further action of the parties hereto.  This Agreement shall be binding upon and accrue to the benefit of the parties hereto and their respective heirs, legal representatives and successors.

3.7Counterparts and Facsimile.  For the convenience of the parties hereto, this Agreement may be executed in any number of separate counterparts, each such counterpart being deemed to be an original instrument, and all such counterparts will together constitute the same agreement.  Executed signature pages to this Agreement may be delivered by facsimile transmission or by e-mail delivery of a “pdf” format data file and such signature pages will be deemed as sufficient as if actual signature pages had been delivered.

3.8Governing Law.  This Agreement will be governed by and construed in accordance with the Laws of Texas.  

6


EXHIBIT 10.1

 

3.9WAIVER OF JURY TRIAL.  EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE EXTENT ALLOWABLE UNDER RELEVANT LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE CONTEMPLATED TRANSACTIONS.

3.10Notices.  Any notice, request, instruction or other document to be given hereunder by any party to the other will be in writing and will be deemed to have been duly given (a) on the date of delivery if delivered personally or by telecopy or facsimile, upon confirmation of receipt, (b) on the first business day following the date of dispatch if delivered by a recognized next-day courier service, or (c) on the third business day following the date of mailing if delivered by registered or certified mail, return receipt requested, postage prepaid.  All notices hereunder shall be delivered as set forth below, or pursuant to such other instructions as may be designated in writing by the party to receive such notice.

(a)If to a Purchaser, as indicated on such Purchaser’s signature page hereto;

(b)If to the Company:

Guaranty Bancshares, Inc.

16475 Dallas Parkway, Suite 600

Addison, Texas 75001

Attention:Randy Kucera

Telephone:(903) 434-4366

Email:[email protected]

 

with a copy to (which copy alone shall not constitute notice):

 

Fenimore, Kay, Harrison & Ford, LLP

812 San Antonio Street, Suite 600

Austin, Texas 78701

Attention:Derek McGee

Telephone:(512) 632-3954

Email:[email protected]

 

3.11Entire Agreement.  This Agreement (including the Exhibits hereto) and the Debenture constitute the entire agreement, and supersedes all other prior agreements, understandings, representations and warranties, both written and oral, among the parties, with respect to the subject matter hereof.

3.12Interpretation; Other Definitions.  Wherever required by the context of this Agreement, the singular shall include the plural and vice versa, and the masculine gender shall include the feminine and neuter genders and vice versa, and references to any agreement, document or instrument shall be deemed to refer to such agreement, document or instrument as amended, supplemented or modified from time to time.  All article, section, paragraph or clause references not attributed to a particular document shall be references to such parts of this Agreement, and all exhibit, annex, letter and schedule references not attributed to a particular document shall be references to such exhibits, annexes, letters and schedules to this Agreement.  The term “Person”

7


EXHIBIT 10.1

 

has the meaning given to it in Section 3(a)(9) of the Exchange Act and as used in Sections 13(d)(3) and 14(d)(2) of the Exchange Act.

3.13Captions.  The article, section, paragraph and clause captions herein are for convenience of reference only, do not constitute part of this Agreement and will not be deemed to limit or otherwise affect any of the provisions hereof.

3.14Severability.  If any provision of this Agreement or the application thereof to any Person (including the officers and directors of the parties hereto) or circumstance is determined by a court of competent jurisdiction to be invalid, void or unenforceable, the remaining provisions hereof, or the application of such provision to Persons or circumstances other than those as to which it has been held invalid or unenforceable, will remain in full force and effect and shall in no way be affected, impaired or invalidated thereby, so long as the economic or legal substance of the Contemplated Transactions is not affected in any manner materially adverse to any party.  Upon such determination, the parties shall negotiate in good faith in an effort to agree upon a suitable and equitable substitute provision to effect the original intent of the parties.

3.15No Third Party Beneficiaries.  Nothing contained in this Agreement, expressed or implied, is intended to confer upon any Person other than the parties hereto, any benefit right or remedies.

3.16Time of Essence.  Time is of the essence in the performance of each and every term of this Agreement.

3.17Specific Performance.  The parties agree that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms.  It is accordingly agreed that the parties shall be entitled to seek specific performance of the terms hereof, this being in addition to any other remedies to which they are entitled at law or equity.

 

[Signatures Follow]

 

 

8


EXHIBIT 10.1

 

IN WITNESS WHEREOF, this Agreement has been duly executed and delivered by the parties hereto, or their duly authorized officers, on the date first written above.

COMPANY:

 

Guaranty Bancshares, Inc.

 

By:

Tyson T. Abston

Chairman and Chief Executive Officer

[Signatures Continued on Following Page]

 

 

[Company Signature Page to Subordinated Debenture Purchase Agreement]


EXHIBIT 10.1

 

PURCHASER:

 

[  ]

 

 

By:

[  ]

 

Attention:

Telephone:

Fax:

Email:

 

 

No. 2020-DB

Committed Amount:

$500,000

Rate:

X.00%

Term:

X months

Maturity

November 1, 20XX

 

[Purchaser Signature Page to Subordinated Note Purchase Agreement]


EXHIBIT 10.1

 

Exhibit A

Accredited Investor Questionnaire

To:

Prospective purchasers of subordinated debentures (the “Securities”) offered by Guaranty Bancshares, Inc. (the “Company”)

Re:Requirement to Submit an Accredited Investor Representation Letter

 

 

The Securities are being sold only to “accredited investors” (“Accredited Investors”) as defined in Rule 501(a) under Regulation D of the Securities Act of 1933, as amended (the “Securities Act”). The purpose of the attached Accredited Investor Representation Letter (the “Letter”) is to collect information from you to determine whether you are an Accredited Investor and otherwise meet the suitability criteria established by the Company for investing in the Securities.  

As part of verifying your status as an Accredited Investor, you may be asked to submit supporting documentation as described in the Letter.  You must fully complete and sign the Letter, and deliver all required supporting documentation, before the Company will consider your proposed investment.  

All of your statements in the Letter and all required supporting documentation delivered by you or on your behalf in connection with the Letter (collectively, the “Investor Information”) will be treated confidentially.

You understand that the Company will rely on your representations and other statements and documents included in the Investor Information in determining your status as an Accredited Investor and whether to accept your subscription for the Securities.

The Company reserves the right, in its sole discretion, to verify your status as an Accredited Investor using any other methods that it may deem acceptable from time to time. However, you should not expect that the Company will accept any other such method. The Company may refuse to accept your request for investment in the Securities for any reason or for no reason.

 

 

 

[remainder of this page intentionally left blank]


[Accredited Investor Questionnaire]


EXHIBIT 10.1

 

ACCREDITED INVESTOR REPRESENTATION LETTER

Guaranty Bancshares, Inc.

Attn: Tyson T. Abston, Chairman and Chief Executive Officer

16475 Dallas Parkway, Suite 600

Addison, Texas 75001

 

Dear Guaranty Bancshares, Inc.:

I am submitting this Accredited Investor Representation Letter (the “Letter”) in connection with the offering of subordinated debentures (the “Securities”) of Guaranty Bancshares, Inc. (the “Company”). I understand that the Securities are being sold only to accredited investors (“Accredited Investors”) as defined in Rule 501(a) of Regulation D of the Securities Act of 1933, as amended (the “Securities Act”).  

I hereby represent and warrant to the Company that I qualify as an Accredited Investor on the basis that:

Representations as to Accredited Investor Status. The undersigned has read the definition of “Accredited Investor” from Rule 501 of Regulation D as set forth in Exhibit A, and certifies that either (You must check either box 1 or 2; if you check box A, you must check at least one of the boxes (a) through (g):

1.The undersigned is an “Accredited Investor” for one or more of the following reasons:

 

(a)The undersigned is an individual (not a partnership, corporation, etc.) whose individual net worth (excess of total assets at fair market value, including homes (but excluding the value of the primary residence of such individual), automobiles and personal property, over total liabilities (but excluding the amount of indebtedness secured by the individual’s primary residence up to its fair market value, and including the amount of any such indebtedness in excess of such fair market value)), or joint net worth with his or her spouse, presently exceeds $1,000,000;

 

(b)The undersigned is an individual (not a partnership, corporation, etc.) who had an income in excess of $200,000 in each of the two most recent years, or joint income with his or her spouse in excess of $300,000 in each of those years (in each case including foreign income, tax exempt income and full amount of capital gains and losses but excluding any income of other family members and any unrealized capital appreciation) and has a reasonable expectation of reaching the same income level in the current year;

 

(c)The undersigned is a director or executive officer (e.g., President or any vice president in charge of a principal business unit, division or function such as sales, administration or finance) of the Company;

[Accredited Investor Questionnaire]


EXHIBIT 10.1

 

 

(d)The undersigned is a corporation, partnership, Massachusetts business trust, or non-profit organization within the meaning of Section 501(c)(3) of the Internal Revenue Code, in each case not formed for the specific purpose of acquiring the Notes and with total assets in excess of $5,000,000;

 

______________________________________________

 

______________________________________________
(describe entity)

 

(e)The undersigned is a trust with total assets in excess of $5,000,000, not formed for the specific purpose of acquiring the Notes, whose purchase would be directed by a “sophisticated person” as described in Rule 506(b)(2)(ii);

 

(f)The undersigned is a revocable trust which may be amended or revoked by the grantors, and all of the grantors satisfy the conditions of clauses (a), (b) or (c) above and have completed copies of this Questionnaire, which copies are delivered to the Company herewith;

 

(g)The undersigned is an entity all the equity owners of which are “accredited investors” within one or more of the above categories.  If relying upon this category alone, each equity owner must complete a separate copy of this Questionnaire;

 

______________________________________________

 

______________________________________________
(describe entity)

2.The undersigned is not an “Accredited Investor.”

 

[signature page follows]


[Accredited Investor Questionnaire]


EXHIBIT 10.1

 

RELIANCE ON REPRESENTATIONS

I understand that the Company and its counsel are relying upon my representations in the Letter and upon the supporting documentation to be delivered by me or on my behalf in connection with the Letter (collectively, the “Investor Information).

SHARING OF INVESTOR INFORMATION

I understand and agree that the Company may present the Investor Information to its legal, accounting and financial advisors and such other parties as it deems appropriate to establish that the issuance and sale of the Securities (a) is exempt from the registration requirements of the Securities Act or (b) meets the requirements of applicable state securities laws.

INVESTOR’S SIGNATURE AND CONTACT INFORMATION

Date: _______________________________

Name:_______________________________

Signature: _______________________________

Email address: _______________________________

Mailing address:_______________________________

_______________________________

_______________________________

_______________________________

Telephone number:_______________________________

 

SPOUSE’S SIGNATURE AND CONTACT INFORMATION

NOTE: The investor’s spouse need only sign this letter if the investor is a natural person proving its accredited investor status based on joint income or joint net worth with the spouse under 1(a) or(b). A spouse who signs this letter makes all representations set out in this letter, including those relating to joint income or joint net worth, as applicable, on a joint and several basis.)

Date: _______________________________

Name:_______________________________

Signature: _______________________________

Email address: _______________________________

Mailing address:_______________________________

_______________________________

_______________________________

_______________________________

Telephone number:_______________________________

 

[Accredited Investor Questionnaire]

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