Item 1.01 Entry into a Material Definitive Agreement.
On
or the like hereunder) entered into a Warrant Agreement (the “Warrant
Agreement”) with
with the Company’s previously announced offers to each holder of the Company’s
9.375% Series B Cumulative Redeemable Preferred Stock, par value
(the “Series B Preferred Stock”), and each holder of the Company’s 9.125%
Series C Cumulative Redeemable Preferred Stock, par value
“Series C Preferred Stock” and together with the Series B Preferred Stock, the
“Preferred Stock”), to exchange all outstanding shares of Preferred Stock for
certain stock and warrant consideration (each, an “Exchange Offer” and together,
the “Exchange Offers”).
In connection with the Exchange Offer for the Series C Preferred Stock, for each
share of Series C Preferred Stock validly tendered and not validly withdrawn,
the Company will issue, in addition to certain common and preferred stock
consideration, 1.5 warrants (the “Warrants”) to acquire an equal number of
shares of the Company’s Common Stock, par value
Stock”), at an exercise price of
issued to the holders of Series C Preferred Stock. If a holder of Series C
Preferred Stock is otherwise entitled to receive a fractional Warrant, the
Company will round down to the nearest whole number of Warrants to be issued to
a holder of Series C Preferred Stock. The Warrants will become exercisable
commencing on
of the Exchange Offer for our Series C Preferred Stock. The Warrants will expire
on
Pursuant to the Warrant Agreement, AST has agreed to act as the Company’s
warrant agent with respect to the Warrants and the Warrant Shares.
The foregoing descriptions of the Warrant Agreement and the Warrants do not
purport to be complete and are subject to, and qualified by, the full text of
such agreements, copies of which are filed as Exhibit 4.1 and Exhibit 4.2,
respectively, and incorporated by reference herein.
Item 3.03 Material Modification to Rights of Security Holders.
The Company’s Series B Preferred Stock was previously issued pursuant to the
terms of Articles Supplementary (the “Series B Articles Supplementary”)
establishing the Series B Preferred Stock with the
Assessments and Taxation of Maryland
Company’s charter (as amended and as currently in effect, the “Charter”).
The Company’s Series C Preferred Stock was previously issued pursuant to the
terms of Articles Supplementary (the “Series C Articles Supplementary”)
establishing the Company’s Series C Preferred Stock with the SDAT which formed a
part of the Charter and which were previously amended by Articles of Amendment
(the “Amended Articles”) amending and restating the terms of the Series C
Preferred Stock.
On
with the SDAT Articles of Amendment amending certain provisions of the Company’s
Series B Articles Supplementary (the “Series B Charter Amendment”) for the
Series B Preferred Stock and Articles of Amendment amending certain provisions
of the Company’s Series C Articles Supplementary for the Company’s Series C
Preferred Stock (the “Series C Charter Amendment,” and together with the
Series B Charter Amendment, the “Charter Amendments”). The material terms of the
Charter Amendments are described below:
Effect on Outstanding Preferred Stock
The Charter Amendments provide that, upon the repurchase of any shares of
Preferred Stock tendered pursuant to the Exchange Offers, we will have no
obligation to pay or make allowance for, and will not make any other payment or
allowance for, the liquidation preference of, or any accrued and unpaid
dividends on, any shares of Preferred Stock which are not repurchased in the
Exchange Offers (whether or not such dividends have accumulated and whether or
not such dividends accrued before or after the Amendment Effective Date (as
defined below)).
Special Redemption Right
The Charter Amendments further provide that, (1) the Series B Preferred Stock
will become redeemable for (a) thirty (30) shares of the Company’s 8.25%
Series D Cumulative Redeemable Preferred Stock, par value
“New Preferred Stock”), and (b) 13.33 shares of Common Stock, subject to
adjustment to prevent the issuance of any fractional shares (collectively, the
“Series B Remainder Consideration”), and (2) the Series C Preferred Stock will
become redeemable for (x) one (1) share of New Preferred Stock, (y) 1.25 shares
of Common Stock, and (z) 1.5 warrants to purchase an equal number of shares of
Common Stock, subject to adjustment to prevent the issuance of any fractional
shares or warrants (collectively, the “Series C Remainder Consideration,” and
together with the Series B Remainder Consideration, the “Preferred Stock
Remainder Consideration”). Any such redemption is referred to herein as the
“Special Redemption.” The Special Redemption right may be exercised by the
Company until
date(s) on which the Series B Charter Amendment and the Series C Charter
Amendment, as applicable, were accepted for filing by the SDAT (such acceptance
date(s), the “Amendment Effective Dates”). If the Company has not exercised its
Special Redemption right to redeem the Series B Preferred Stock or Series C
Preferred Stock by the date that is sixty-five (65) days after the applicable
Amendment Effective Date, each Charter Amendment provides that, upon request of
any holder of Series B Preferred Stock or Series C Preferred Stock, as
applicable, within two (2) years after the applicable Amendment Effective Date,
the Company shall redeem all outstanding shares of Series B Preferred Stock or
Series C Preferred Stock, as applicable, for the applicable Preferred Stock
Remainder Consideration, on the date fixed by the Company within ninety (90)
days of such request, subject to any delay required by the Company to comply
with applicable
Stock Remainder Consideration. If any shares of Series B Preferred Stock or
Series C Preferred Stock (not otherwise participating in the Exchange Offers)
have still not been redeemed by the second (2nd) anniversary of the applicable
Amendment Effective Date, such shares will remain outstanding with all of their
current rights, preferences and privileges.
The Charter Amendments provide that the Company’s right and obligation to effect
the Special Redemption is without regard to or compliance with any other
provisions set forth in the Series B Articles Supplementary, with regard to the
Series B Preferred Stock, or the Amended Articles, with regard to the Series C
Preferred Stock, including provisions relating to dividends and redemption.
If notice of Special Redemption has been given by the Company and if the
applicable Preferred Stock Remainder Consideration has been set aside by the
Company for the benefit of the holders of Series B Preferred Stock and/or
Series C Preferred Stock, as the case may be, then from and after the date of
such redemption, the shares of Series B Preferred Stock or Series C Preferred
Stock will no longer be deemed to be outstanding, dividends will cease to accrue
on such shares, and all rights of the holders thereof will terminate except for
the right to receive the applicable Preferred Stock Remainder Consideration. We
will have no obligation to pay or make allowance for, and will not make any
other payment or allowance for, the liquidation preference of, or any accrued
and unpaid dividends on, any shares of Preferred Stock which are redeemed
pursuant to the Special Redemption right (whether or not such dividends have
accumulated and whether or not such dividends accrued before or after the
Amendment Effective Date).
If the Company elects to effect the Special Redemption or is required to effect
the Special Redemption, with regard to either Series B Preferred Stock or
Series C Preferred Stock, the Company will deposit the required Series B
Remainder Consideration or Series C Remainder Consideration, as applicable, with
a bank or trust company for the purpose of redeeming Series B Preferred Stock or
Series C Preferred Stock, as applicable, which deposit will be irrevocable
except that (a) the Company will be entitled to receive from such bank or trust
company the interest or other earnings, if any, earned on any amounts so
deposited in trust, and the holders of any shares redeemed shall have no claim
to such interest or other earnings, and (b) any balance of funds and any other
Series B Remainder Consideration or Series C Remainder Consideration, as
. . .
Item 5.03. Amendments to Articles of Incorporation or Bylaws.
Series B Preferred Stock & Series C Preferred Stock
On
Series C Charter Amendment amending certain terms of the Series B Articles
Supplementary and Series C Articles Supplementary, as amended by the Amended
Articles. The information about the Charter Amendments contained under Item 3.03
of this report, including the summary description of changes to the rights and
preferences of the Series B Preferred Stock and the Series C Preferred Stock, is
incorporated into this Item 5.03 by reference.
The description of the Charter Amendments contained in this Item 5.03 is
qualified in its entirety by reference to the full text of the Series B Charter
Amendment and the Series C Charter Amendment, which are filed as Exhibit 3.1 and
Exhibit 3.2 hereto, respectively, and are incorporated herein by reference.
New Preferred Stock
On
Articles Supplementary”) with the SDAT for the purpose of establishing the terms
of the New Preferred Stock and classifying and designating 35,000,000 shares of
authorized, but unissued, Common Stock as New Preferred Stock.
The following is a summary of the principal terms of the New Preferred Stock:
Ranking
The New Preferred Stock will rank, with respect to dividend rights and rights
upon liquidation, dissolution or our winding up:
· senior to all classes or series of our common stock, our Series A-1 Preferred
Stock, our Series B Preferred Stock, our Series C Preferred Stock and any other class or series of our capital stock expressly designated as ranking junior to the New Preferred Stock;
· on parity with any future class or series of our capital stock expressly
designated as ranking on parity with the New Preferred Stock; and
· junior to any other class or series of our capital stock expressly designated
as ranking senior to the New Preferred Stock, none of which exists on the date hereof.
The New Preferred Stock will also rank junior in right of payment to our
existing and future debt obligations.
Dividends
Holders of shares of New Preferred Stock will be entitled to receive, when, as
and if authorized by our Board and declared by us, preferential cumulative cash
dividends at the rate of 8.25% per annum of the
share of the New Preferred Stock (equivalent to a fixed annual amount of
per share of the New Preferred Stock).
Dividends on the New Preferred Stock will accrue and be cumulative from and
including the date of original issue, or if later, the most recent dividend
payment date on which dividends have been paid in full, and will be payable to
holders annually in arrears on or about the 31 day of December of each year,
beginning on
Dividends will be payable to holders of record as they appear in our stock
records at the close of business on the applicable record date, which shall be
the date designated by our Board as the record date for the payment of dividends
that is not more than ninety (90) and not fewer than ten (10) days prior to the
scheduled dividend payment date.
Dividends on the New Preferred Stock will accrue whether or not:
· we have earnings;
· there are funds legally available for the payment of those dividends; or
· those dividends are authorized or declared.
No dividends on the New Preferred Stock will be authorized by the Board,
declared, paid or set apart for payment at such time as the terms and provisions
of any agreement of the Company, including any agreement relating to its
indebtedness prohibits such authorization, declaration, payment or setting apart
for payment or provides that such authorization, declaration, payment or setting
apart for payment would constitute a breach thereof, or a default thereunder, or
if such authorization, declaration, payment or setting apart shall be restricted
or prohibited by law.
Except as described in the next two paragraphs, and except as described below
with respect to the repurchase or redemption of shares of our Series B Preferred
Stock and Series C Preferred Stock in the Exchange Offers or upon the Special
Redemption of such shares, unless full cumulative dividends on the New Preferred
Stock shall have been or contemporaneously are declared and paid in cash or
declared and a sum sufficient for the payment thereof in cash is set apart for
payment, we will not:
· declare and pay or declare and set apart for payment of dividends, and we will
not declare and make any other distribution of cash or other property, directly or indirectly, on or with respect to any shares of our common stock or shares of any other class or series of our capital stock ranking, as to dividends, on parity with or junior to the New Preferred Stock, for any period; or
· redeem, purchase or otherwise acquire for any consideration, or make any other
distribution of cash or other property, directly or indirectly, on or with respect to, or pay or make available any monies for a sinking fund for the redemption of, any common stock or shares of any other class or series of our capital stock ranking, as to payment of dividends and the distribution of assets upon our liquidation, dissolution or winding up, on parity with or junior to the New Preferred Stock.
The foregoing sentence, however, will not prohibit:
· dividends payable solely in capital stock ranking, as to payment of dividends
and the distribution of assets upon our liquidation, dissolution or winding up,
junior to the New Preferred Stock;
· the conversion into or exchange for other shares of any class or series of
capital stock ranking, as to payment of dividends and the distribution of assets upon our liquidation, dissolution or winding up, junior to the New Preferred Stock; or
· our purchase of shares of any other class or series of capital stock ranking on
parity with the New Preferred Stock as to payment of dividends and the distribution of assets upon our liquidation, dissolution or winding up pursuant to a purchase or exchange offer made on the same terms to holders of all outstanding shares of New Preferred Stock.
When we do not pay dividends in full (and do not set apart a sum sufficient to
pay them in full) on the New Preferred Stock and the shares of any other class
or series of capital stock ranking, as to dividends, on parity with the New
Preferred Stock, we will declare any dividends upon the New Preferred Stock and
. . .
Item 8.01 Other Events
In conjunction with the closing of the Exchange Offers, the Company will issue
approximately (A) (i) 6,142,213 shares of Common Stock and (ii) 13,823,340
shares of New Preferred Stock in exchange for the shares of Series B Preferred
Stock tendered in the Exchange Offer for the Series B Preferred Stock, and
(B) (i) 1,188,106 shares of Common Stock, (ii) 950,471 shares of New Preferred
Stock, and (iii) 1,425,695 Warrants to purchase the same number of shares of
Common Stock in exchange for the shares of Series C Preferred Stock tendered in
the Exchange Offer for the Series C Preferred Stock.
In addition, in connection with the petitions (the “Plaintiff Series B Award
Motions”) for a court award of attorney’s fees, expenses or other monetary award
to be deducted and paid from the Company’s payment of distributions or other
payments to the holders of the Company’s Series B Preferred Stock in the matter
Action”), the Company will deposit, no later than
approximately (i) 13,311,840 shares of New Preferred Stock and (ii) 4,437,280
shares of the Company’s Common Stock in the custody of a third party custodian
or escrow agent (the “Escrow Shares”). The allocation of the Escrow Shares will
be made by instruction from the
disposition of all outstanding matters in the Maryland Action, including the
Plaintiff Series B Award Motions.
On
of the Exchange Offers. A copy of the press release is attached as Exhibit 99.1
and is incorporated by reference herein.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
Exhibit
No. Description
3.1 Articles of Amendment to the Company's Charter to permit the closing of
the Company's Exchange Offers and make the Series B Preferred Stock
redeemable for certain stock consideration, effective October 24, 2022 .
3.2 Articles of Amendment to the Company's Charter to permit the closing of
the Company's Exchange Offers and make the Series C Preferred Stock
redeemable for certain stock and warrant consideration, effective
October 24, 2022 .
3.3 Articles Supplementary to the Company's Charter designating 8.25%
Series D Cumulative Redeemable Preferred Stock, liquidation preference
$0.10 per share, par value $0.01 per share, effective October 24, 2022 .
4.1 Warrant Agreement with American Stock Transfer & Trust Company , dated
October 25, 2022 .
4.2 Form of Warrant issued in Exchange Offer for Company's Series C
Preferred Stock (included in Exhibit 4.1).
99.1 Press release issued by Impac Mortgage Holdings, Inc. , dated
October 26, 2022 .
104 Cover Page Interactive Data File (embedded within the Inline XBRL
Document).© Edgar Online, source
