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):
October
31, 2008
United Community Banks,
Inc.
(Exact
name of registrant as specified in its charter)
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Georgia
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No.
0-21656
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No.
58-180-7304
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(State
or other jurisdiction of
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(Commission
File Number)
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(IRS
Employer
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incorporation)
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Identification
No.)
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63
Highway 515, P.O. Box 398
Blairsville,
Georgia 30512
(Address
of principal executive offices)
Registrant's
telephone number, including area code:
(706)
781-2265
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:
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o
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Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
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o
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Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
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o
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Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
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Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240-13e-4(c))
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Item
8.01
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Other
Events
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Fixed Rate Trust
Preferred Secured Offering.
On
October 31, 2008, United Community Banks, Inc. (“UCBI”)
completed a private placement of $12,131,000 of trust preferred securities
through a newly formed Delaware trust subsidiary, United Community
Statutory Trust II (“Statutory
Trust II”), pursuant to an Amended and Restated Trust Agreement,
dated October 31, 2008. The trust preferred securities mature
October 31, 2038, are redeemable at UCBI’s option at par of $1,000 per
capital security on or after October 31, 2013 and bear interest at a fixed
rate equal to 9.0% of the liquidation amount of the
securities. Capital securities of Statutory Trust II were
issued to accredited investors. All of the common securities of
Statutory Trust II are held by UCBI.
The
proceeds from the sale of the trust preferred securities were used by
Statutory Trust II to purchase $12,131,000 in aggregate principal amount
of UCBI’s fixed rate junior subordinate debentures. The net
proceeds to UCBI from the sale of the debentures to the trust will be used
for general corporate purposes, which may include providing additional
capital to UCBI’s subsidiary bank, United Community Bank.
The
debentures were issued pursuant to an Indenture, dated October 31, 2008,
between UCBI, as issuer, and US National Bank Association, as
trustee. Like the trust preferred securities, the debentures
bear interest at a fixed rate per annum of 9%. The interest
payments on the debentures will be used to pay the quarterly distributions
payable by Statutory Trust II to the holders of the trust preferred
securities. However, so long as no event of default has
occurred under the debentures, UCBI may defer interest payments on the
debentures (in which case Statutory Trust II will also defer distributions
otherwise on the trust preferred securities) for up to 20 consecutive
quarters. The debentures are subordinated to the prior payment
of any other indebtedness that, by its terms, is not similarly
subordinated. The debentures will be recorded as a long-term
liability on UCBI’s balance sheet and will be treated as Tier 1 capital
for regulatory purposes. The debentures mature on October 31,
2038 but may be redeemed at UCBI’s option on or after October 31, 2013 or
at any time upon certain events, such as change in the regulatory capital
treatment of the trust preferred securities, Statutory Trust II being
deemed an investment company or the occurrence of certain adverse tax
events.
Variable Rate Trust
Preferred Secured Offering.
On
October 31, 2008, UCBI completed a private placement of $1,238,000 of
trust preferred securities through a newly formed Delaware trust
subsidiary, United Community Statutory Trust III (“Statutory
Trust III”), pursuant to an Amended and Restated Trust Agreement,
dated October 31, 2008. The trust preferred securities mature
October 31, 2038, are redeemable at UCBI’s option at par of $1,000 per
capital security on or after October 31, 2013 and bear interest at a
variable rate equal to prime plus 3% of the liquidation amount of the
securities. The “prime rate” means the prime rate published in
the Wall Street Journal Southeastern Edition. Capital
securities of Statutory Trust III were issued to accredited
investors. All of the common securities of Statutory Trust III
are held by UCBI.
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The
proceeds from the sale of the trust preferred securities were used by
Statutory Trust III to purchase $1,238,000 in aggregate principal amount
of UCBI’s variable rate junior subordinate debentures. The net
proceeds to UCBI from the sale of the debentures to the trust will be used
for general corporate purposes, which may include raising additional
capital to United Community Bank.
The
debentures were issued pursuant to an Indenture, dated October 31, 2008
between UCBI, as issuer, and US National Bank Association, as
trustee. Like the trust preferred securities, the debentures
bear interest at a variable rate equal to prime plus 3% of the liquidation
amount of the securities. The interest payments on the
debentures will be used to pay the quarterly distributions payable by
Statutory Trust III to the holders of the trust preferred
securities. However, so long as no event of default has
occurred under the debentures, UCBI may defer interest payments on the
debentures (in which case Statutory Trust III will also defer
distributions otherwise on the trust preferred securities) for up to 20
consecutive quarters. The debentures are subordinated to the
prior payment of any other indebtedness that, by its terms, is not
similarly subordinated. The debentures will be recorded as a
long-term liability on UCBI’s balance sheet; however, for regulatory
purposes, the debentures will be treated as Tier 1 capital. The
debentures mature on October 31, 2030 but may be redeemed at UCBI’s option
and with regulatory approval on or after October 31, 2013 or at any time
upon certain events, such as change in the regulatory capital treatment of
the trust preferred securities, Statutory Trust III being deemed an
investment company or the occurrence of certain adverse tax
events.
General
Each
capital security issued as a part of these trust preferred offerings by
Statutory Trust II and Statutory Trust III were issued with a warrant to
purchase shares of UCBI common stock. The warrants are not
tradable or transferable separate from the related capital
securities. Each warrant may be exercised by exchanging the
related capital security and the warrant for the number of shares of
common stock of UCBI resulting from dividing the par value of $1,000 by
the conversion price. The conversion price is set at $20.00 per share of
common stock, but is subject to adjustment as a result of any stock
dividend by UCBI of its capital stock that is greater than 2% of
outstanding shares, any split of UCBI’s common stock, or similar event
affecting UCBI common stock.
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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.
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/s/ Rex S. Schuette
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Rex
S. Schuette
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Executive
Vice President and
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November
6, 2008
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Chief
Financial Officer
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