Item 5.03 Amendments to Articles of Incorporation or By-Laws; Change in Fiscal Year.
On April 25, 2022, the Corporation filed the Statement with the Secretary of State of the Commonwealth of Pennsylvania, which became effective upon filing, amending its Amended and Restated Articles of Incorporation to establish the newly authorized Series U Preferred Stock of the Corporation consisting of 10,000 authorized shares.
Holders of Series U Preferred Stock will be entitled to receive, when, as and if declared by the Board of Directors of the Corporation (the “Board”) or a duly authorized committee of the Board, non-cumulative cash dividends based on the liquidation preference (1)
from the original issue date of the Series U Preferred Stock to, but excluding, May 15, 2027 (the “first reset date”), at a fixed rate per annum of 6.000%, and (2) from and including the first reset date, during each reset period (as defined below), at a rate per annum equal to the five-year U.S. Treasury rate (as defined in the Statement) as of the most recent reset dividend determination date (as defined below) plus a spread of 3.000%. If declared by the Board or a duly authorized committee of the Board, dividends will be payable on the Series U Preferred Stock quarterly in arrears on February 15, May 15, August 15 and November 15 of each year, beginning on August 15, 2022. A “reset date” means the first reset date and each date falling on the fifth anniversary of the preceding reset date. Reset dates, including the first reset date, will not be adjusted for business days. A “reset period” means the period from and including the first reset date to, but excluding, the next following reset date and thereafter each successive period from and including each reset date to, but excluding, the next following reset date. A “reset dividend determination date” means, in respect of any reset period, the day falling three business days prior to the first day of such reset period.
The Series U Preferred Stock has a liquidation preference of $100,000 per share, plus any declared and unpaid dividends, without accumulation of any undeclared dividends. Liquidating distributions will be made on the Series U Preferred Stock only to the extent of the Corporation’s assets that are available after satisfaction of all liabilities to depositors and creditors and subject to the rights of holders of any security ranking senior to the Series U Preferred Stock, and pro rata as to the Series U Preferred Stock and any other shares of the Corporation’s stock ranking equally as to such distributions.
The Series U Preferred Stock does not have any maturity date. The Series U Preferred Stock is redeemable at the Corporation’s option (1) in whole or in part, from time to time, on any dividend payment date on or after the first reset date, at a redemption price equal to $100,000 per share (equivalent to $1,000 per depositary share), plus any declared and unpaid dividends, without accumulation of any undeclared dividends, or (2) in whole but not in part, at any time within 90 days following a regulatory capital treatment event (as defined in the Statement), at a redemption price equal to $100,000 per share (equivalent to $1,000 per depositary share), plus any declared and unpaid dividends and an amount equal to the partial dividend that would have accrued from the prior scheduled dividend payment date to the redemption date. If the Corporation redeems the Series U Preferred Stock, the depositary will redeem a proportionate number of Depositary Shares. Accordingly, the Series U Preferred Stock will remain outstanding indefinitely, unless and until the Corporation decides to redeem it. The Series U Preferred Stock has no preemptive or conversion rights.
The Series U Preferred Stock has no voting rights except with respect to (1) authorizing, increasing the authorized amount of or issuing senior stock; (2) authorizing adverse changes in the terms of the Series U Preferred Stock; (3) certain merger events; (4) in the case of certain non-payments of dividends only, electing directors; and (5) as otherwise required under Pennsylvania law.
The terms of the Series U Preferred Stock are more fully described in the Statement, which is included as Exhibit 3.1 to this Current Report on Form 8-K and is incorporated by reference herein.