- Current report filing (8-K)
April 15 2010 - 5:04PM
Edgar (US Regulatory)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): April 15, 2010
Capital Crossing Preferred Corporation
(Exact name of registrant as specified in its charter)
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Massachusetts
(State or other jurisdiction
of incorporation)
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000-25193
(Commission File Number)
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04-3439366
(IRS Employer
Identification No.)
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1271 Avenue of the Americas
46
th
Floor
New York, New York 10020
(Address of principal executive offices, including zip code)
(212) 377-1503
(Registrants telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following provisions (See General
Instruction A.2 below):
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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Pre- commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Item 7.01.
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Regulation FD Disclosure.
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The Office of Thrift Supervision (the OTS) has notified Aurora Bank FSB (Aurora Bank) that the
prior approval of the OTS is currently required before payment by Capital Crossing Preferred
Corporation (the Company) of dividends on its 8.50% Non-Cumulative Exchangeable Preferred Stock,
Series D (the Series D preferred stock) as a result of the cease and desist order entered against
Aurora Bank on January 26, 2009, and the prompt corrective action directive issued to Aurora Bank
on February 4, 2009.
Aurora Bank has made a formal request to the OTS to approve the payment of future dividends on the
Series D preferred stock and responded to various communications from the OTS for additional
information on the payment of these dividends, however, the OTS has not yet ruled on this request.
Accordingly, the Board of Directors of the Company (the Board of Directors) has voted not to
declare or pay the Series D preferred stock dividend or the 8% Cumulative Non-Convertible Preferred
Stock, Series B (the Series B preferred stock) dividend that would have been payable on April 15,
2010.
There can be no assurance that approval for the payment of future dividends on the Series D
preferred stock will be received from the OTS or when or if such OTS approval requirement will be
removed. Furthermore, any future dividends on the Series D preferred stock or the Series B
preferred stock will be payable only when, as and if declared by the Board of Directors. The terms
of the Series D preferred stock provide that dividends on the Series D preferred stock are not
cumulative and if no dividend is declared for a quarterly dividend period, the holders of the
Series D preferred stock will have no right to receive a dividend for that period, and the Company
will have no obligation to pay a dividend for that period, whether or not dividends are declared
and paid for any future period. The terms of the Series B preferred stock provide that dividends
payable to the Series B holders are junior in priority to the payment of dividends to the Series D
holders.
In order to continue to qualify as a real estate investment trust, or a REIT, under the Internal
Revenue Code of 1986, as amended, the Company generally is required each year to distribute to its
stockholders at least 90% of its net taxable income, excluding net capital gains. As a REIT, the
Company generally is not required to pay federal income tax if it continues to meet this and a
number of other requirements. If the OTS does not grant approval to the Company to pay dividends to
its stockholders in an amount necessary to retain the Companys REIT qualification, the Company
will fail to qualify as a REIT should it not be permitted to declare a dividend on or about
September 15, 2010 and, as a result, will be subject to federal income tax.
Forward-Looking Statements
This Current Report on Form 8-K contains certain forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange
Act of 1934, as amended. Those forward-looking statements include all statements other than those
made solely with respect to historical fact.
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Numerous risks, uncertainties and other factors may cause actual results to differ materially from
those expressed in any forward-looking statements. Forward-looking statements should not be unduly
relied upon because they involve known and unknown risks, uncertainties and other factors, some of
which are beyond the control of the Company. Such risks, uncertainties and other factors include,
but are not limited to: limitations by regulatory authorities on the Companys ability to implement
its business plan and restrictions on its ability to pay dividends; the risk that the failure of
the Company to maintain its status as a REIT would result in the Company being subject to federal
income tax, including any applicable alternative minimum tax and excise tax; the risk that the
Company could be disqualified from treatment as a REIT for the four taxable years following the
year during which qualification was lost; further regulatory limitations on the business of Aurora
Bank that are applicable to the Company; the risk that a decline, or a perceived decline, in Aurora
Banks capital situation may result in the Series D preferred stock being subject to an automatic
exchange into preferred shares of Aurora Bank; the risk that Aurora Banks capital ratios may fall
below certain specified levels and that Aurora Bank may be forced to merge with or be acquired by
another entity or begin voluntary dissolution; the risk that the Series D preferred stock will in
the future be delisted from The NASDAQ Stock Market or will otherwise cease to trade on The NASDAQ
Stock Market; the risk that the Series D preferred stock may not otherwise retain value and/or
liquidity; the risk that the Company may not have adequate cash available, including as a result of
the Company being subject to federal income tax, to pay dividends with respect to the Series D
preferred stock; negative economic conditions that adversely affect the general economy, housing
prices, the job market, consumer confidence and spending habits which may affect, among other
things, the credit quality of the Companys loan portfolios (the degree of the impact of which is
dependent upon the duration and severity of these conditions); the level and volatility of interest
rates; changes in consumer, investor and counterparty confidence in, and the related impact on,
financial markets and institutions; legislative and regulatory actions which may adversely affect
the Companys business and economic conditions as a whole; the impact of litigation and regulatory
investigations; various monetary and fiscal policies and regulations; changes in accounting
standards, rules and interpretations and the impact on the Companys financial statements; changes
in the nature and quality of the types of loans held by the Company; and risks relating to the
Companys business discussed in its filings with the Securities and Exchange Commission. These
risks, uncertainties and other factors may cause the actual results, performance or achievements of
the Company to be materially different from the anticipated future results, performance or
achievements that are expressed or implied by the forward-looking statements. Forward-looking
statements speak only as of the date they are made, and the Company undertakes no obligation to
update any forward-looking statement to reflect the impact of circumstances or events that arise
after the date the forward-looking statement was made.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly
caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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CAPITAL CROSSING PREFERRED CORPORATION
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Date: April 15, 2010
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By:
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/s/ Thomas OSullivan
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Name:
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Thomas OSullivan
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Title:
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President
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