Citizens Community Bancorp places SOFR-linked fixed-to-floater
Citizens Community Bancorp has completed a $15m placement of 10-year SOFR-linked fixed-to-floating rate subordinated notes. The notes will pay interest at a fixed rate of 6% p.a. for the first five years, after which the rate will switch to the then current three-month SOFR plus 591 bp.

Item 1.01. Entry into a Material Definitive Agreement.

On August 27, 2020 , Citizens Community Bancorp, Inc. a Maryland corporation (the "Company") entered into a Subordinated Note Purchase Agreement ("Note Purchase Agreement") with certain accredited purchasers (the "Purchasers"), pursuant to which the Purchasers agreed to purchase 6.00% fixed-to-floating subordinated notes in the aggregate principal amount of $15 million (the "Notes"). The Notes provide for a maturity date to occur ten years from the date of issuance. From the date of issuance of the Notes until, but excluding, September 1, 2025 (the "Fixed Interest Period"), the annual interest rate of the Notes is 6.00%. After the Fixed Interest Period and through maturity (the "Floating Interest Period"), the interest rate will be reset quarterly to equal the three-month term Secured Overnight Financing Rate, plus 591 basis points. Interest on the Notes will be payable semi-annually in arrears on March 1 and September 1 of each year during the Fixed Interest Period, and quarterly in arrears on March 1 , June 1 , September 1 and December 1 of each year during the Floating Interest Period.

The Notes are expected to qualify as Tier 2 capital for regulatory capital purposes, subject to applicable limitations. The Note Purchase Agreement provides that the Notes may not be redeemed by the Company prior to the fifth anniversary of the effective date of the Notes, with certain limited exceptions.

The Note Purchase Agreement contains customary representations, warranties and covenants by each of the parties.

Janney Montgomery Scott LLC acted as sole placement agent for the offering. Taft Stettinius & Hollister LLP acted as legal counsel to the Company, and Godfrey & Kahn, S.C. acted as legal counsel to Janney Montgomery Scott .

The foregoing summary of the Note Purchase Agreement and the Notes does not purport to be complete and is subject to and qualified in its entirety by the full text of the Form of Note Purchase Agreement and the Form of Note, which are filed as Exhibits 4.1 and 4.2, respectively, to this Current Report on Form 8-K and are incorporated herein by reference.

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

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

Item 3.03. Material Modifications to Rights of Security Holders.

During the continuance of an event of default under the Note Purchase Agreement, the Company is restricted from declaring or paying any dividends on, or redeeming, purchasing, acquiring or making a liquidation payment with respect to, any of its capital stock, other than (i) any dividends or distributions in shares of, or options, warrants or rights to subscribe for or purchase shares of, any class of the Company's common stock; (ii) any declaration of a non-cash dividend in connection with the implementation of a shareholders' rights plan, or the issuance of stock under any such plan in the future, or the redemption or repurchase of any such rights pursuant thereto; (iii) as a result of a reclassification of the Company's capital stock or the exchange or conversion of one class or series of the Company's capital stock for another class or series of the Company's capital stock; (iv) the purchase of fractional interests in shares of the Company's capital stock pursuant to the conversion or exchange provisions of such capital stock or the security being converted or exchanged; or (v) purchases of any class of the Company's common stock

--------------------------------------------------------------------------------

related to the issuance of common stock or rights under any benefit plans for the Company's directors, officers or employees or any of the Company's dividend reinvestment plans.

Item 9.01. Financial Statements and Exhibits. (d) Exhibits.

4.1 Form of Subordinated Note Purchase Agreement

4.2 Form of Subordinated Note

104 The cover page from this Current Report on Form 8-K in Inline XBRL (Extensible Business Reporting Language)

--------------------------------------------------------------------------------