GWG Holdings, Inc. (NASDAQ:GWGH) Files An 8-K Submission of Matters to a Vote of Security Holders
Item 5.07
As part of the combination between GWG Holdings, Inc. (the “Company,” “we” or “us”) and The Beneficient Company Group, L.P. (“Beneficient”), we continue to assess alternatives to create and expand on the synergies between the two companies, diversify and strengthen our consolidated balance sheet, and maximize value for our investors. We believe that having the authority to exchange all of the Company’s equity securities for equity securities of the Company or one or more subsidiaries of the Company is a potential avenue to create additional organizational efficiencies for the Company while at the same time enabling us to grow our consolidated balance sheet in a prudent and sustainable manner, and in turn create additional potential value for our shareholders. To provide that flexibility to the Company, we are seeking authority for the Company to effect an exchange of its equity securities for securities issued by the Company or one or more subsidiaries of the Company by adopting an Amended and Restated Certificate of Incorporation of the Company (the “Amended Charter”).
The proposed Amended Charter, a copy of which is filed as Exhibit 99.1 to this Current Report on Form 8-K, has been adopted by the Board of Directors of the Company, which declared its advisability, based upon a recommendation of its Special Committee of independent and disinterested directors. It has also been approved by the written consent from the holders of a majority of the outstanding shares of the Company’s common stock, par value $.001 per share (the “Common Stock”). To become effective, the Amended Charter must also be approved by the holders of a majority of the outstanding shares of the Company’s two series of preferred stock, each series voting separately as a class (the “Preferred Stock”). We plan to solicit the consent of the holders of our Preferred Stock to the Amended Charter. While the Company believes such an exchange of equity securities may be a potential avenue to create efficiencies, the Company has not approved any plans to exchange either the Company’s Common Stock or Preferred Stock or the specific terms or issuer of any such securities that may be issued in connection therewith.
The Amended Charter would permit the Company to effect an exchange of each share of the then outstanding shares of Common Stock in exchange for a number of securities of one or more classes or series of the Company or one or more subsidiaries of the Company (the “subsidiary securities”). The value that each share of Common Stock will be exchange for may not be less than the greater of (i) $10.00 (subject to certain adjustments), or (ii) the volume weighted average price (VWAP) of the Common Stock for the twenty (20) trading days immediately prior to the date of any notice of exchange. The Amended Charter also requires that at least one class of the subsidiary securities to be listed on a national securities exchange prior to, or at the time of, the exchange.
In addition, the Amended Charter would permit the Company to exchange all of the Preferred Stock for preferred equity securities of the Company or one or more subsidiaries of the Company (the “subsidiary preferred interest”) with substantially similar terms to that of the Preferred Stock; provided that, the Amended Charter requires the subsidiary preferred interest to have the following preferential terms:
| 99.1 | Proposed Amended Charter (filed herewith) |
GWG Holdings, Inc. Exhibit
EX-99.1 2 ea123782ex99-1_gwgholdings.htm PROPOSED AMENDED CHARTER Exhibit 99.1 FORM OF AMENDED AND RESTATED CERTIFICATE OF INCORPORATION OF GWG HOLDINGS,…
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About GWG Holdings, Inc. (NASDAQ:GWGH)
GWG Holdings, Inc. is a specialty finance company. The Company is a financial purchaser of life insurance assets in the secondary market. The Company creates opportunities for consumers owning life insurance to obtain value for their policies as compared to the traditional options offered by insurance companies. The Company also creates opportunities for investors to participate in alternative asset classes, such as life insurance, not correlated to traditional financial markets. The Company conducts its life insurance related business through its subsidiary, GWG Life, LLC. It generally purchases life insurance assets directly from policy owners having purchased their life insurance in the primary market. Its operational platform offers various options to customers based on the market value of their life insurance, including selling the entire policy benefit for cash, or selling a portion of the policy benefit and retaining a portion of the benefit with no future premium obligation.
