8-KOther EventsExhibits & Filings

TRUIST FINANCIAL CORP 8-K Report, Corporate Update (Jul 28, 2009)

Filed July 28, 2009For Securities:TFCTFC-POTFC-PRTFC-PI

Summary

BB&T Corporation (now Truist Financial Corp.) announced the closing of a public offering for $500 million of its Enhanced Trust Preferred Securities through its statutory trust, BB&T Capital Trust VI. An additional $75 million in securities were purchased by underwriters to cover over-allotments. The net proceeds from this offering, after fees and expenses, amounted to approximately $557.5 million. These funds were raised by the trust and subsequently invested by the trust into BB&T's Junior Subordinated Debentures. The company has provided a guarantee for payments related to these securities, but this guarantee is contingent upon the trust having sufficient funds available. This move reflects BB&T's strategy to bolster its capital structure. The transaction involved various agreements, including an underwriting agreement, a fifth supplemental indenture for the subordinated debentures, an amended and restated trust agreement, and a guarantee agreement.

Key Highlights

  • 1BB&T Corporation successfully closed a public offering of $500 million in Enhanced Trust Preferred Securities via BB&T Capital Trust VI.
  • 2Underwriters exercised an option to purchase an additional $75 million in securities, bringing the total offering size to $575 million.
  • 3Net proceeds from the offering, after expenses, are approximately $557.5 million.
  • 4The proceeds were used by the trust to purchase BB&T's Junior Subordinated Debentures.
  • 5BB&T provided a guarantee for payments on the securities, subject to the trust having sufficient funds.
  • 6The issuance is part of BB&T's capital raising efforts to strengthen its financial position.
  • 7The offering and related agreements were registered under a Form S-3 shelf registration statement.

Frequently Asked Questions

This 8-K filing was made to report the closing of a public offering of $500 million of Enhanced Trust Preferred Securities by BB&T Capital Trust VI, a subsidiary of BB&T Corporation, and to file related agreements as exhibits. It signifies a significant capital raise for the company.

BB&T Corporation, through its trust, raised approximately $557.5 million in net proceeds after accounting for underwriting commissions, discounts, and estimated expenses.

Enhanced Trust Preferred Securities are a type of preferred stock-like instrument issued by a trust that is typically backed by a guarantee from a parent company, in this case, BB&T Corporation. The proceeds from the sale of these securities by the trust were used to purchase junior subordinated debentures issued by BB&T, effectively providing capital to the corporation.

The Guarantee Agreement ensures that BB&T Corporation will guarantee payments on the Capital Securities, but this guarantee is limited. It is contingent upon the trust having sufficient funds available to make such payments. If the trust lacks funds, BB&T is not obligated to cover the shortfall.