Item 3.03
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Material Modification to Rights of Security Holders.
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On August 10, 2021, Arbor Realty Trust, Inc. (the
“Company”) filed Articles Supplementary (the “Articles Supplementary”) with the Maryland State Department of Assessments
and Taxation to designate 5,750,000 shares of the Company’s authorized but unissued preferred stock, $0.01 par value per share,
as shares of 6.25% Series E Cumulative Redeemable Preferred Stock, with the powers, designations, preferences and other rights as set
forth therein (the “Series E Preferred Stock”). The Articles Supplementary became effective upon filing on August 10, 2021.
The Articles Supplementary provide that the Company
will pay, when and if authorized by the Board of Directors of the Company, cumulative cash dividends at the rate of 6.25% of the $25.00
liquidation preference (equivalent to $1.5625 per annum per share) on the Series E Preferred Stock, in arrears, on the 30th
day of January, April, July and October of each year (provided that if any dividend payment date is not a business day, then the dividend
which would otherwise have been payable on that dividend payment date may be paid on the next succeeding business day), commencing on
October 30, 2021.
The Series E Preferred Stock is not redeemable
by the Company prior to August 11, 2026 except under circumstances intended to preserve the Company’s qualification as a real estate
investment trust (“REIT”) and except upon the occurrence of a Change of Control (as defined in the Articles Supplementary).
On and after August 11, 2026, the Company may, at its option, redeem the Series E Preferred Stock, in whole or in part, at any time or
from time to time, for cash at a redemption price equal to $25.00 per share, plus any accumulated and unpaid dividends to, but not including,
the date fixed for redemption.
In addition, upon the occurrence of a Change
of Control, the Company may, at its option, redeem the Series E Preferred Stock, in whole or in part on, or within 120 days after,
the first date on which such Change of Control occurred, for cash at a redemption price of $25.00 per share, plus any accumulated
and unpaid dividends to, but not including, the date fixed for redemption.
The Series E Preferred Stock has no stated maturity,
is not subject to any sinking fund or mandatory redemption and will remain outstanding indefinitely unless repurchased or redeemed by
the Company or converted into the Company’s common stock in connection with a Change of Control by the holders of Series E Preferred
Stock. Upon the occurrence of a Change of Control, each holder of Series E Preferred Stock will have the right (unless the Company has
exercised its right to redeem the Series E Preferred Stock in whole or in part, as described above, prior to the Change of Control Conversion
Date (as defined in the Articles Supplementary)) to convert some or all of the Series E Preferred Stock held by such holder on the Change
of Control Conversion Date into a number of shares of the Company’s common stock per share of Series E Preferred Stock determined
by a formula, in each case, on the terms and subject to the conditions described in the Articles Supplementary, including provisions for
the receipt, under specified circumstances, of alternative consideration.
There are restrictions on ownership of the Series
E Preferred Stock intended to preserve the Company’s qualification as a REIT. Except under limited circumstances, holders of the
Series E Preferred Stock have no voting rights.
A copy of the Articles Supplementary and form
of Series E Preferred Stock Certificate are filed as Exhibits 3.1 and 4.1, respectively, to this report, and the information in the
Articles Supplementary is incorporated into this Item 3.03 by reference. The description of the terms of the Articles Supplementary
in this Item 3.03 is qualified in its entirety by reference to Exhibit 3.1.