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Item 1.
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Security and Issuer
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This statement constitutes Amendment No. 3 to the Schedule 13D, as amended prior hereto, relating to shares of common stock, par
value $0.01 per share, of Broadway Financial Corporation (the “Registrant”), and hereby amends the Schedule 13D filed with the Securities and Exchange Commission (the “Schedule 13D”) to furnish the additional information set
forth herein. All capitalized terms contained herein but not otherwise defined shall have the meanings described to such terms in the Schedule 13D.
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Item 4.
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Purpose of Transaction
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Item 4 of the Schedule 13D is hereby amended to add the following at the end thereof:
On April 13, 2020, The Capital Corps, LLC (“Capital Corps”) delivered a letter (the “Letter”) to the Board of Directors of the Registrant (the
“Board”) proposing binding and non-binding provisions relating to the proposed acquisition by Capital Corps of the Registrant. The non-binding provisions include (i) the acquisition of all of the Registrant’s outstanding shares of
common stock for (a) $48.8 million (the “Purchase Price”), or approximately $1.75 per share (representing a premium of approximately 33% to the 30-day average closing prices of the Registrant’s common stock prior to the date of the
Letter), less (b) the sum of (1) all transaction-related expenses (as described in the Letter) over 2% of the Purchase Price plus (2) any reduction in the Registrant’s book value subsequent to December 31, 2019 through the execution of the
definitive agreement relating to the proposed acquisition, (ii) Capital Corps and the Registrant will negotiate in good faith to agree upon a definitive agreement setting forth in detail the terms and conditions of definitive documents within 90
days of the full execution of the Letter (subject to extension) at the end of which the Letter will terminate, except for certain binding provisions. The Letter’s non-binding provisions include the Registrant’s conduct of business in the
ordinary course, waiver of the Registrant’s “poison pill”, reasonable access to information, confidentiality, publicity and each party bearing its own costs.
The potential acquisition would be subject to the approval of the Board and the shareholders of the Registrant and the Reporting Persons and the negotiation and execution of
mutually agreeable definitive transaction documents and certain other conditions contained in the Letter. Other conditions to closing would include, without limitation, regulatory approvals. No assurances can be given that any transaction will be
consummated, whether on the terms outlined in the Letter or at all.
The foregoing summary does not purport to be or contain a complete description of the Letter, a copy of
which is filed as Exhibit 99.3 to this Amendment No. 3 and incorporated herein by this reference.
Other than as described above, the Reporting Persons have no plans or
proposals which relate to or would result in any of the events described in (a) through (j) of Item 4, except as described herein and as follows. The Reporting Persons are continually reviewing their interest in the Registrant. Depending upon (i)
the Registrant’s businesses, assets and prospects and the outcome of discussions with the Board regarding a potential acquisition, (ii) other plans and requirements of the Reporting Persons, (iii) general economic conditions and overall market
conditions and the ability of the Reporting Persons to carry out transactions without liability under Section 16 of the Securities and Exchange Act, (iv) the price at which shares of Common Stock are available for sale, and (v) availability of
alternative investment opportunities and the Reporting Persons’ investment strategy at the time, the Reporting Persons may seek to pursue the potential acquisition with the Registrant or to not pursue the potential acquisition and instead
decrease their holdings of Common Stock, and may seek to engage in communications with management or the Board of Directors of the Registrant or with other stockholders of the Registrant concerning the Issuer’s businesses, prospects,
operations, strategy, personnel, directors, ownership and capitalization, and either individually or together with others may make additional proposals with respect to the Registrant that may involve one or more of the types of transactions
specified in clauses (a) through (j) of Item 4 of Schedule 13D.
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Item 7.
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Material to be Filed as Exhibits
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Exhibit
No.
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Description
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99.1
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Letter from The Capital Corps, LLC to the Registrant dated April 13, 2020.
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