Sturgis Bancorp, Inc. (OTCPK:STBI) announced a private placement of 5.0% fixed-to-floating rate subordinated notes due December 30, 2030 for gross proceeds of $15 million from various accredited investors on December 30, 2020. The price for the notes was 100% of the principal amount of the notes. The interest on the notes will accrue at a rate equal to 5% per annum from the original issue date to, but excluding, December 30, 2025, payable semi-annually in arrears, and a floating rate per annum equal to a benchmark rate, which is expected to be the Three-Month Term SOFR, plus a spread of 473 basis points from and including December 30, 2025 until maturity, payable quarterly in arrears. Beginning on December 30, 2025 through maturity, the Notes may be redeemed, at the Company's option, on any scheduled interest payment date. The company received funding pursuant to Regulation D.