CENTRAL FEDERAL CORPORATION (NASDAQ:CFBK) Files An 8-K Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year
Item 5.03. Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year
On May 28, 2020, Central Federal Corporation (the “Company”) filed with the Delaware Secretary of State a Certificate of Amendment to the Company’s Certificate of Incorporation, as amended (the “Certificate of Amendment”), to create a class of non-voting common stock, par value $0.01 per share, of the Company (the “Non-Voting Common Stock”) and to authorize 1,260,700 shares of Non-Voting Common Stock. As previously disclosed in the Company’s Current Report on Form 8-K filed on May 28, 2020, the Certificate of Amendment was approved by the stockholders of the Company at the annual meeting of stockholders held on May 27, 2020.
Effective as of the close of business on May 28, 2020, all 1,260,700 authorized shares of Non-Voting Common Stock were issued upon conversion of the 12,607 outstanding shares of the Company’s non-voting convertible perpetual preferred stock, series C, par value $0.01 per share (the “Series C Preferred Stock”). to the terms of the Series C Preferred Stock, each outstanding share of Series C Preferred Stock converted automatically into 100 shares of Non-Voting Common Stock at such time.
The preferences, limitations, powers and relative rights of the Non-Voting Common Stock are set forth in the Certificate of Amendment, a summary of which follows:
Dividends: The Non-Voting Common Stock will rank pari passu with the voting common stock, par value $0.01 per share, of the Company (the “Common Stock”) with respect to the payment of Dividends (as defined in the Certificate of Amendment). Accordingly, the holders of record of Non-Voting Common Stock will be entitled to receive as, when, and if declared by the Company’s Board of Directors, Dividends in the same per share amount as paid on the Common Stock, and no Dividends will be payable on the Common Stock or any other class or series of capital stock ranking with respect to Dividends pari passu with the Common Stock unless a Dividend identical to that paid on the Common Stock is payable at the same time on the Non-Voting Common Stock in an amount per share of Non-Voting Common Stock equal to the product of (i) the per share Dividend declared and paid in respect of each share of Common Stock and (ii) the number of shares of Common Stock into which such share of Non-Voting Common Stock is then convertible (without regard to any limitations on conversion of the Non-Voting Common Stock); provided, however, that if a stock Dividend is declared on Common Stock payable solely in Common Stock, the holders of Non-Voting Common Stock will be entitled to a stock Dividend payable solely in shares of Non-Voting Common Stock. In the event that the Company’s Board of Directors does not declare or pay any Dividends with respect to shares of Common Stock, then the holders of Non-Voting Common Stock will have no right to receive any Dividends.
Voting Rights: The holders of Non-Voting Common Stock will not have any voting rights, except (i) as may otherwise from time to time be required by law and (ii) that the approval of the holders of a majority of the issued and outstanding shares of Non-Voting Common Stock will be required for the Company to take any of the following actions (including by means of merger, consolidation or otherwise): (a) altering or changing the rights, preferences, privileges or restrictions provided for the benefit of the holders of the Non-Voting Common Stock so as to affect them adversely; (b) increasing or decreasing the authorized number of shares of Non-Voting Common Stock; or (c) entering into any agreement, merger or business consolidation, or engaging in any other transaction, or taking any action that would have the effect of adversely changing any preference or any relative or other right provided for the benefit of the holders of the Non-Voting Common Stock.
Conversion: Each share of Non-Voting Common Stock will be convertible into one share of Common Stock, subject to adjustment as provided in the Certificate of Amendment, as follows:
(i)Each share of Non-Voting Common Stock may be converted by the holder thereof into one share of Common Stock at any time or from time to time, provided that upon such conversion the holder, together with all Affiliates (as defined in the Certificate of Amendment) of the holder, will not own or control in the aggregate more than 9.9% of the Common Stock (or of any class of the Company’s Voting Securities (as defined in the Certificate of Amendment)), excluding for the purpose of this calculation any reduction in ownership resulting from transfers by such holder of the Company’s Voting Securities (which, for the avoidance of doubt, does not include Non-Voting Common Stock); or
(ii)Each share of Non-Voting Common Stock will automatically convert into one share of Common Stock, without any further action on the part of any holder, on the date a holder of Non-Voting Common Stock transfers any shares of Non-Voting Common Stock to a non-affiliate of the holder in a Permissible Transfer (as defined in the Certificate of Amendment).
Redemption: The Non-Voting Common Stock will not be redeemable by the Company or the holder.
The foregoing description of the Certificate of Amendment does not purport to be complete and is qualified in its entirety by reference to the full text of the Certificate of Amendment, a copy of which is included as Exhibit 3.1 to this Current Report on Form 8-K and incorporated by reference herein..
Item 9.01. Financial Statements and Exhibits
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CENTRAL FEDERAL CORP Exhibit
EX-3.1 2 cfbk-20200602xex3_1.htm EX-3.1 Exhibit 3.1 Exhibit 3.1 CERTIFICATE OF AMENDMENT TO THE Certificate of Incorporation OF Central federal corporation Pursuant to the provisions of the Certificate of Incorporation and the Bylaws of the Corporation and applicable law,…
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About CENTRAL FEDERAL CORPORATION (NASDAQ:CFBK)
Central Federal Corporation is a holding company of CFBank. CFBank is a savings institution. The Company attracts retail and business deposits from the general public and use the deposits, together with borrowings and other funds, primarily to originate commercial and commercial real estate loans, single-family and multi-family residential mortgage loans and home equity lines of credit. The Company’s customers are small businesses, small business owners and consumers. The loan portfolio consists primarily of commercial, commercial real estate and multi-family mortgage loans, mortgage loans secured by single-family residences and consumer loans. Its primary sources of funds are retail and business deposit accounts and certificates of deposit, brokered certificates of deposit and, to a lesser extent, principal and interest payments on loans and securities, Federal Home Loan Bank (FHLB) advances, other borrowings and proceeds from the sale of loans.
