Broadway Financial Corporation (the “Company”) (NASDAQ Capital Market:
BYFC), parent company of Broadway Federal Bank, f.s.b. (the “Bank”),
today reported that the Company’s stockholders approved all of the
proposals presented at the Annual Meeting on November 27, including the
proposals to amend the Company’s Certificate of Incorporation to
increase the number of authorized shares of Common Stock to 50,000,000
shares and authorize the Company to issue up to 5,000,000 shares of a
new class of non-voting Common Stock.
As a result, on December 2, 2013 the Company’s 13,299 outstanding shares
of Series F Common Stock Equivalents (the “Common Stock Equivalents”)
will automatically convert into 13,299,000 shares of Common Stock,
representing 66.02% of the Company’s total equity, and its 6,982 shares
of Series G Non-Voting Preferred Stock (the “Series G Preferred”) will
automatically convert into 698,200 shares of non-voting Common Stock,
representing 3.47% of the Company’s total equity. The Common Stock
Equivalents automatically convert at the rate of 1,000 shares of Common
Stock for each share of Common Stock Equivalents, and the Series G
Preferred automatically convert at the rate of 100 shares of Common
Stock for each share of Series G Preferred.
The Common Stock Equivalents and Series G Preferred had been issued on
August 22, 2013 in exchange for: (i) all five series of the Company’s
formerly outstanding preferred stock (Series A through E), with an
aggregate liquidation value or preference of $17.6 million, including
the TARP Preferred Stock that had been issued to the U.S. Department of
the Treasury pursuant to the Capital Purchase Program component of the
Treasury Department’s Troubled Asset Relief Program, (ii) all of the
accumulated dividends on the TARP Preferred Stock, and (iii) $2.6
million principal amount of the Company’s bank debt, as part of a
Recapitalization of the Company’s balance sheet. The Company issued the
Common Stock Equivalents, in lieu of Common Stock, because the Company
did not have a sufficient number of authorized shares to complete the
Recapitalization.
Chief Executive Officer, Wayne Bradshaw stated, “We are pleased to
report that stockholders overwhelmingly supported our proposals
presented at the Annual Meeting this week, in particular the proposals
to amend our Certificate of Incorporation to increase the number of
authorized shares of Common Stock and authorize the Company to issue
shares of a new series of non-voting Common Stock. As a result, our plan
to simplify the equity portion of our balance sheet, which commenced
with the recently completed Recapitalization, has now been fully
realized. For the foreseeable future, all of our equity securities will
consist of either shares of Common Stock or non-voting Common Stock, as
all of our series of outstanding preferred stock have been eliminated.
We believe that these changes to our capital structure will enhance our
ability to access additional equity capital in the future.
“Looking ahead, we are planning to continue rebuilding our loan
portfolio to grow net interest income, as well as begin the process of
negotiating an extension of the maturity of our subordinated debentures
that mature in March 2014. In conjunction with that extension, we plan
to raise additional equity capital to strengthen the balance sheets of
both the Company and the Bank, and provide capital for growth.
“We wish to thank our stockholders again for their continued support,
and we remain focused on continuing our efforts to resume growth for the
Company and increase value for our stockholders.”
About Broadway Financial Corporation
Broadway Financial Corporation conducts its operations through its
wholly-owned subsidiary, Broadway Federal Bank, f.s.b., which is the
leading community-oriented savings bank in Southern California serving
low to moderate income communities. We offer a variety of residential
and commercial real estate loan products for consumers, businesses, and
non-profit organizations, other loan products, and a variety of deposit
products, including checking, savings and money market accounts,
certificates of deposits and retirement accounts. The Bank operates
three full service branches, two in the city of Los Angeles, and one
located in the nearby city of Inglewood, California.
Shareholders, analysts and others seeking information about the Company
are invited to write to: Broadway Financial Corporation, Investor
Relations, 5055 Wilshire Blvd., Suite 500, Los Angeles, CA 90036, or
visit our website at www.broadwayfederalbank.com.
This press release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995. These
forward-looking statements are based upon our management’s current
expectations, and involve risks and uncertainties. Actual results or
performance may differ materially from those suggested, expressed, or
implied by the forward-looking statements due to a wide range of factors
including, but not limited to, the general business environment, the
real estate market, competitive conditions in the business and
geographic areas in which the Company conducts its business, regulatory
actions or changes and other risks detailed in the Company’s reports
filed with the Securities and Exchange Commission, including the
Company’s Annual Reports on Form 10-K and Quarterly Reports on Form
10-Q. The Company undertakes no obligation to revise any forward-looking
statement to reflect any future events or circumstances, except to the
extent required by law.
Copyright Business Wire 2013