UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934
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any of the following provisions (see General Instruction A.2. below):
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Soliciting
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Securities registered pursuant to Section 12(b) of the Act:
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933
(§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for
complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Item 1.01. Entry into a Material Definitive Agreement.
On March 29, 2023, CrossFirst Bankshares, Inc. (the “Company”) entered into a Securities Purchase Agreement (the "Purchase
Agreement") with certain investors qualified as "accredited investors," as such term is defined in Rule 501(a) of Regulation D ("Regulation
D") promulgated under the Securities Act of 1933, as amended (the "Securities Act"), pursuant to which the Company offered and sold
shares of its Series A Non-Cumulative Perpetual Preferred Stock, par value $0.01 per share (the "Series A Preferred Stock"), for an
aggregate purchase price of $7,750,000. This amount includes $6,150,000 paid by directors and members of the senior leadership team of
the Company or CrossFirst Bank (including our executive officers) and their affiliates to acquire Series A Preferred Stock. The offer and
sale of the Series A Preferred Stock by the Company was made in reliance upon the exemptions from registration available under Section
4(a)(2) of the Securities Act and Rule 506(b) of Regulation D. The Purchase Agreement includes customary representations, warranties
and covenants of the Company.
On March 29, 2023, the Company filed a Certificate of Designations for the Series A Preferred Stock (the "Certificate of Designations")
with the Secretary of State of the State of Kansas. The Certificate of Designations establishes the authorized number of shares of Series A
Preferred Stock as 15,000 and provides for the powers, designations, preferences and relative, participating, optional or other special rights
of the Series A Preferred Stock and the qualifications, limitations or restrictions thereof. A copy of the Certificate of Designations is
attached hereto as Exhibit 3.1 and is incorporated herein by reference.
Pursuant to the Certificate of Designations, holders of the Series A Preferred Stock will be entitled to receive, only when, as and if declared
by the Company’s Board of Directors or a duly authorized committee thereof, non-cumulative cash dividends on the liquidation preference
of $1,000 per share of Series A Preferred Stock at a rate of 8.00% per annum, payable quarterly in arrears. Such dividends are not
mandatory or cumulative and are payable only to the extent declared by the Company’s Board of Directors or a duly authorized committee
thereof. The Series A Preferred Stock is not convertible into any other class of securities. The Series A Preferred Stock is structured to
qualify as Tier 1 capital. So long as any Series A Preferred Stock remains outstanding, unless full dividends for the most recently
completed dividend period have been declared and paid (or declared and a sum sufficient for the payment thereof has been set aside) on all
outstanding shares of Series A Preferred Stock, the Company may not, subject to certain exceptions, declare, pay or set aside for payment
any dividend on the Company’s common stock or any other shares of capital stock ranking junior to the Series A Preferred Stock, or
repurchase, redeem or otherwise acquire for consideration, directly or indirectly, the Company’s common stock or any other shares of
capital stock ranking junior to or on a parity with the Series A Preferred Stock. Subject to the foregoing, dividends (payable in cash, stock,
or otherwise) may be declared and paid on the common stock and any other class or series of capital stock that ranks junior to the Series A
Preferred Stock, and the holders of the Series A Preferred Stock will not be entitled to participate in any such dividend.
The Series A Preferred Stock is perpetual and has no maturity date and is not subject to any mandatory redemption, sinking fund, or other
similar provisions. The holders of the Series A Preferred Stock will not have any right to require the redemption or repurchase of their
shares of Series A Preferred Stock. The Company may, at its option and subject to required regulatory approval, redeem the Series A
Preferred Stock (i) in whole or in part, from time to time, on March 29, 2028, or on any dividend payment date on or after March 29, 2028,
or (ii) in whole but not in part at any time within 90 days following a “regulatory capital treatment event” (as defined in the Certificate of
Designations) in each case at a redemption price equal to $1,000 per share, plus the per share amount of any declared and unpaid
dividends, without accumulation of any undeclared dividends. Upon the voluntary or involuntary liquidation, dissolution, or winding-up of
the Company, holders of outstanding shares of Series A Preferred Stock are entitled to be paid out of the Company's assets legally
available for distribution to stockholders, subject to the rights of holders of any securities then outstanding ranking senior to or on parity
with Series A Preferred Stock with respect to distributions of assets and before any distribution of assets is made to holders of common
stock or any other junior stock, a liquidating distribution in the amount of the liquidation preference of $1,000 per share, plus any declared
and unpaid dividends prior to the payment of the liquidating distribution, without accumulation of any dividends that have not been
declared prior to the payment of the liquidating distribution. Holders of the Series A Preferred Stock will have no voting rights except with
respect to certain changes in the terms of the Series A Preferred Stock, the issuance of capital stock ranking senior to the Series A Preferred
Stock, certain fundamental business transactions and as otherwise required by applicable law, subject to certain limitations.
The Company intends to use the net proceeds from the sale of the Series A Preferred Stock for general corporate purposes, including
providing capital to support strategic growth and for making contributions to the capital of CrossFirst Bank, to support its lending,
investing and other banking activities.
The foregoing descriptions of the Purchase Agreement and the Series A Preferred Stock do not purport to be complete and are qualified in
their entirety by reference to the form of the Purchase Agreement attached hereto as Exhibit 10.1 and the Certificate of Designations
attached hereto as Exhibit 3.1, respectively, and are incorporated herein by reference.
Item 3.02. Unregistered Sales of Equity Securities.
The information contained in Item 1.01 of this Current Report on Form 8-K is incorporated by reference into this Item 3.02.
Item 3.03. Material Modification to Rights of Security Holders.
The information contained in Item 1.01 of this Current Report on Form 8-K is incorporated by reference into this Item 3.03.
Upon issuance of the Series A Preferred Stock (as described in Item 1.01 of this Current Report on Form 8-K) on March 29, 2023, the
ability of the Company to declare or pay dividends on, or purchase, redeem or otherwise acquire, shares of its common stock, par value
$0.01 per share, will be subject to certain restrictions in the event that the Company fails to pay dividends on the Series A Preferred Stock.
Holders of the Series A Preferred Stock have certain approval rights and the Series A Preferred Stock ranks senior to the common stock of
the Company upon liquidation. These provisions are set forth in the Certificate of Designations, which establishes the authorized number
of shares of Series A Preferred Stock as 15,000 and provides for the powers, designations, preferences and relative, participating, optional
or other special rights of the Series A Preferred Stock and the qualifications, limitations or restrictions thereof. A copy of the Certificate of
Designations is attached hereto as Exhibit 3.1 and is incorporated herein by reference.
Item 5.03. Amendment to Articles of Incorporation or Bylaws; Change in Fiscal Year.
The information contained in Item 1.01 of this Current Report on Form 8-K is incorporated by reference into this Item 5.03.
On March 29, 2023, the Company filed the Certificate of Designations with the Secretary of State of the State of Kansas, which was
effective upon filing. The Certificate of Designations establishes the authorized number of shares of Series A Preferred Stock as 15,000
and provides for the powers, designations, preferences and relative, participating, optional or other special rights of the Series A Preferred
Stock and the qualifications, limitations or restrictions thereof. A description of certain material terms of the Series A Preferred Stock is set
forth in Item 1.01 of this Current Report on Form 8-K. A copy of the Certificate of Designations is attached hereto as Exhibit 3.1 and is
incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits.
(d)
Exhibits
3.1
10.1
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SIGNATURE
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.
Date:
March 31, 2023
CROSSFIRST BANKSHARES, INC.
By:
/s/ Benjamin R. Clouse
Benjamin R. Clouse
Chief Financial Officer
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Exhibit 3.1
CERTIFICATE OF DESIGNATIONS
OF
SERIES A NON-CUMULATIVE PERPETUAL PREFERRED STOCK
OF
CROSSFIRST BANKSHARES, INC.
CrossFirst Bankshares, Inc., a Kansas corporation, referred to herein as the "corporation",
in accordance with the provisions of K.S.A. § 17-6401, does hereby certify:
The board of directors of the corporation, referred to herein as the "board of directors", in
accordance with Article III of the Articles of Incorporation of the corporation , as amended, and
applicable law, adopted the following resolution on March 22, 2023 creating a series of 15,000
shares of preferred stock of the corporation designated as "Series A Non-Cumulative Perpetual
Preferred Stock":
RESOLVED
, that pursuant to the authority conferred on the board of directors by
the corporation's Articles of Incorporation, as amended, the Series A Non-Cumulative
Perpetual Preferred Stock, as a series of preferred stock, par value $0.01 per share, of the
corporation, be and it hereby is created; and that the designations, powers, preferences and
rights of the Series A Non-Cumulative Perpetual Preferred Stock, and the qualifications,
limitations or restrictions thereof are as follows:
1. Designation and Number of Shares. There is hereby created out of the authorized
and unissued shares of preferred stock of the corporation authorized by Article III(a) a series of
preferred stock designated as the "Series A Non-Cumulative Perpetual Preferred Stock" (the
"Series A Preferred Stock"). The par value of the Series A Preferred Stock shall be $0.01 per share.
The authorized number of shares of Series A Preferred Stock shall be 15,000. The number of shares
constituting the Series A Preferred Stock may be increased from time to time by resolution of the
board of directors or a duly authorized committee of the board of directors in accordance with the
Articles of Incorporation, the Bylaws, and applicable law up to the maximum number of shares of
preferred stock authorized to be issued under the Articles of Incorporation less all shares at the
time authorized of any other series of preferred stock or decreased from time to time by a resolution
of the board of directors or a duly authorized committee of the board of directors in accordance
with the Articles of Incorporation, the Bylaws, and applicable law but not below the number of
shares of Series A Preferred Stock then outstanding. Shares of Series A Preferred Stock shall be
dated the date of issue, which date shall be referred to herein as the “original issue date.” Shares
of outstanding Series A Preferred Stock that are redeemed, purchased, or otherwise acquired by
the corporation shall be cancelled and shall revert to authorized but unissued shares of the preferred
stock, undesignated as to series. The corporation shall have the authority to issue fractional shares
of Series A Preferred Stock.
2. Definitions. As used herein with respect to the Series A Preferred Stock:
“Appropriate Federal Banking Agency” means the “appropriate Federal banking
agency” with respect to the corporation as defined in Section 3(q) of the Federal Deposit
Insurance Act (12 U.S.C. Section 1813(q)), or any successor provision.
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“Articles of Incorporation” means the Articles of Incorporation of the corporation,
as amended, and as it may be amended or restated from time to time.
“Business Day” means any day, other than a Saturday or Sunday, that is neither a
legal holiday nor a day on which banking institutions are authorized or required by law or
regulation to close in Kansas.
3. Ranking. The shares of Series A Preferred Stock shall rank:
(a) senior, as to dividends and upon liquidation, dissolution, and winding-up of
the corporation, to the common stock of the corporation and to any other class or series of
capital stock of the corporation now or hereafter authorized, issued, or outstanding that, by
its terms, does not expressly provide that such class or series ranks pari passu with the
Series A Preferred Stock or senior to the Series A Preferred Stock as to dividends and upon
liquidation, dissolution, and winding-up of the corporation, as the case may be
(collectively, “Series A Junior Securities”);
(b) on a parity, as to dividends and upon liquidation, dissolution, and winding-
up of the corporation, with any class or series of capital stock of the corporation now or
hereafter authorized, issued, or outstanding that, by its terms, expressly provides that such
class or series ranks pari passu with the Series A Preferred Stock as to dividends and upon
liquidation, dissolution, and winding-up of the corporation, as the case may be
(collectively, “Series A Parity Securities”); and
(c) junior, as to dividends and upon liquidation, dissolution, and winding-up of
the corporation, to any other class or series of capital stock of the corporation now or
hereafter authorized, issued, or outstanding that, by its terms, expressly provides that such
class or series ranks senior to the Series A Preferred Stock as to dividends and upon
liquidation, dissolution, and winding-up of the corporation, as the case may be.
The corporation may authorize and issue additional shares of Series A Preferred Stock, Series A
Junior Securities and Series A Parity Securities from time to time without the consent of the holders
of the Series A Preferred Stock.
4. Dividends.
(a) Holders of Series A Preferred Stock will be entitled to receive, only when,
as, and if declared by the board of directors or a duly authorized committee of the board of
directors, on each Dividend Payment Date (as defined below), out of assets legally
available for the payment of dividends thereof, non-cumulative cash dividends based on
the liquidation preference of the Series A Preferred Stock of $1,000 per share. Dividends
on each share of Series A Preferred Stock shall accrue at a rate equal to 8.00% per annum
on the liquidation preference of $1,000 per share for each Dividend Period. In the event
the corporation issues additional shares of the Series A Preferred Stock after the original
issue date, dividends on such shares may accrue from the original issue or any other date
specified by the board of directors or a duly authorized committee of the board of directors
at the time such additional shares are issued.
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(b) If declared by the board of directors or a duly authorized committee of the
board of directors, dividends will be payable on the Series A Preferred Stock quarterly in
arrears on March 15, June 15, September 15, and December 15 of each year, beginning on
June 15, 2023 (each such day a “Dividend Payment Date”) based on a liquidation
preference of $1,000 per share. In the event that any Dividend Payment Date falls on a day
that is not a Business Day, the dividend payment due on that date shall be postponed to the
next day that is a Business Day and no additional dividends shall accrue as a result of that
postponement.
(c) Dividends will be payable to holders of record of Series A Preferred Stock
as they appear on the corporation’s stock register on the applicable record date, which shall
be the 15
th
date, not less than 15 calendar days nor more than 30 calendar days before the applicable
Dividend Payment Date, as such record date shall be fixed by the board of directors or a
duly authorized committee of the board of directors.
(d) A “Dividend Period” is the period from and including a Dividend Payment
Date to, but excluding, the next succeeding Dividend Payment Date or any earlier
redemption date, except that the initial Dividend Period will commence on and include the
original issue date of Series A Preferred Stock (or other date specified by the board of
directors or a duly authorized committee of the board of directors as provided in sub-
section (a)) and continue to, but excluding, the next Dividend Payment Date. Dividends
payable on Series A Preferred Stock will be computed on the basis of a 360-day year
consisting of twelve 30-day months. Dollar amounts resulting from the calculation will be
rounded to the nearest cent, with one-half cent being rounded upward. Dividends on the
Series A Preferred Stock will cease to accrue on the redemption date, if any, with respect
to the Series A Preferred Stock redeemed, unless the corporation defaults in the payment
of the redemption price of the Series A Preferred Stock called for redemption.
(e) Dividends on the Series A Preferred Stock will not be cumulative. If the
board of directors or a duly authorized committee of the board of directors does not declare
a dividend, in full or otherwise, on the Series A Preferred Stock in respect of a Dividend
Period, then such unpaid dividends shall cease to accrue and shall not be payable on the
applicable Dividend Payment Date or be cumulative, and the corporation will have no
obligation to pay (and the holders of the Series A Preferred Stock will have no right to
receive) dividends accrued for such Dividend Period after the Dividend Payment Date for
such Dividend Period, whether or not the board of directors or a duly authorized committee
of the board of directors declares a dividend for any future Dividend Period with respect to
the Series A Preferred Stock, the common stock, or any other class or series of the
corporation’s preferred stock. No interest, or sum of money in lieu of interest, shall be
payable in respect of any dividend not declared.
(f) Notwithstanding any other provision hereof, dividends on the Series A
Preferred Stock shall not be declared, paid, or set aside for payment to the extent such act
would cause the corporation to fail to comply with the laws and regulations applicable to
it, including applicable capital adequacy rules of the Board of Governors of the Federal
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Reserve System (the “Federal Reserve”) or, as and if applicable, the capital adequacy rules
or regulations of any Appropriate Federal Banking Agency.
(g) So long as any share of Series A Preferred Stock remains outstanding:
(i) no dividend or distribution shall be declared, paid or set aside for
payment, and no distribution shall be declared or made or set aside for payment, on
any Series A Junior Securities, other than (A) a dividend payable solely in Series
A Junior Securities or (B) any dividend in connection with the implementation of a
stockholders’ rights plan, or the issuance of rights, stock, or other property under
any such plan, or the redemption or repurchase of any rights under any such plan;
(ii) no shares of Series A Junior Securities shall be repurchased,
redeemed, or otherwise acquired for consideration by the corporation, directly or
indirectly, other than (A) as a result of a reclassification of Series A Junior
Securities for or into other Series A Junior Securities, (B) the exchange or
conversion of one share of Series A Junior Securities for or into another share of
Series A Junior Securities, (C) through the use of the proceeds of a substantially
contemporaneous sale of other shares of Series A Junior Securities, (D) purchases,
redemptions, or other acquisitions of shares of Series A Junior Securities in
connection with any employment contract, benefit plan, or other similar
arrangement with or for the benefit of employees, officers, directors, or consultants,
(E) purchases of shares of Series A Junior Securities pursuant to a contractually
binding requirement to buy Series A Junior Securities existing prior to the
preceding Dividend Period, including under a contractually binding stock
repurchase plan, or (F) the purchase of fractional interests in shares of Series A
Junior Securities pursuant to the conversion or exchange provisions of such stock
or the security being converted or exchanged; nor shall any monies be paid to or
made available for a sinking fund for the redemption of any such securities by the
corporation; and
(iii) no shares of Series A Parity Securities shall be repurchased,
redeemed, or otherwise acquired for consideration by the corporation, directly or
indirectly, other than (A) pursuant to pro rata offers to purchase all, or a pro rata
portion, of the Series A Preferred Stock and such Series A Parity Securities, if any,
(B) as a result of a reclassification of Series A Parity Securities for or into other
Series A Parity Securities, (C) the exchange or conversion of one share of Series A
Parity Securities for or into another share of Series A Parity Securities or Series A
Junior Securities, (D) through the use of the proceeds of a substantially
contemporaneous sale of other shares of Series A Parity Securities, (E) purchases
of shares of Series A Parity Securities pursuant to a contractually binding
requirement to buy Series A Parity Securities existing prior to the preceding
Dividend Period, including under a contractually binding stock repurchase plan, or
(F) the purchase of fractional interests in shares of Series A Parity Securities
pursuant to the conversion or exchange provisions of such stock or the security
being converted or exchanged; nor shall any monies be paid to or made available
for a sinking fund for the redemption of any such securities by the corporation;
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unless, in each case, the full dividends for the most recently completed Dividend
Period on all outstanding shares of Series A Preferred Stock have been declared
and paid or declared and a sum sufficient for the payment thereof has been set aside.
(h) Notwithstanding the foregoing, if dividends are not paid in full, or set aside
for payment in full, on any dividend payment date, upon the shares of Series A Preferred
Stock and any Series A Parity Securities, all dividends declared upon shares of Series A
Preferred Stock and any Series A Parity Securities for such dividend payment date shall be
declared on a pro rata basis in proportion to the respective amounts of undeclared and
unpaid dividends for the Series A Preferred Stock and all Series A Parity Securities on such
dividend payment date. To the extent a dividend period with respect to any Series A Parity
Securities coincides with more than one Dividend Period, for purposes of the immediately
preceding sentence the board of directors shall treat such dividend period as two or more
consecutive dividend periods, none of which coincides with more than one Dividend
Period, or shall treat such dividend period(s) with respect to any Series A Parity Securities
and Dividend Period(s) for purposes of the immediately preceding sentence in any other
manner that it deems to be fair and equitable in order to achieve ratable payments of
dividends on such Series A Parity Securities and the Series A Preferred Stock. To the extent
a Dividend Period coincides with more than one dividend period with respect to any Series
A Parity Securities, for purposes of the first sentence of this paragraph the board of
directors shall treat such Dividend Period as two or more consecutive Dividend Periods,
none of which coincides with more than one dividend period with respect to such Series A
Parity Securities, or shall treat such Dividend Period(s) and dividend period(s) with respect
to any Series A Parity Securities for purposes of the first sentence of this paragraph in any
other manner that it deems to be fair and equitable in order to achieve ratable payments of
dividends on the Series A Preferred Stock and such Series A Parity Securities. For the
purposes of this paragraph, the term “dividend period” as used with respect to any Series
A Parity Securities means such dividend periods as are provided for in the terms of such
Series A Parity Securities.
(i) Subject to the foregoing, dividends (payable in cash, stock, or otherwise), as may
be determined by the board of directors or a duly authorized committee of the board of directors,
may be declared and paid on the common stock and any other class or series of capital stock
ranking equally with or junior to Series A Preferred Stock from time to time out of any assets
legally available for such payment, and the holders of Series A Preferred Stock shall not be entitled
to participate in any such dividend.
5. Liquidation
(a) Upon any voluntary or involuntary liquidation, dissolution, or winding-up of the
corporation, holders of Series A Preferred Stock are entitled to receive out of the assets of the
corporation available for distribution to stockholders, after satisfaction of liabilities and obligations
to creditors, if any, and subject to the rights of holders of any securities then outstanding ranking
senior to or on parity with Series A Preferred Stock with respect to distributions of assets, before
any distribution or payment out of the assets of the corporation is made to holders of common
stock or any Series A Junior Securities, a liquidating distribution in the amount of the liquidation
preference of $1,000 per share plus any declared and unpaid dividends prior to the payment of the
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liquidating distribution, without accumulation of any dividends that have not been declared prior
to the payment of the liquidating distribution. After payment of the full amount of such liquidating
distribution, the holders of Series A Preferred Stock shall not be entitled to any further participation
in any distribution of assets of the corporation.
(b) In any such liquidating distribution, if the assets of the corporation are not sufficient
to pay the liquidation preferences (as defined below) in full to all holders of Series A Preferred
Stock and all holders of any Series A Parity Securities, the amounts paid to the holders of Series
A Preferred Stock and to the holders of all Series A Parity Securities will be paid pro rata in
accordance with the respective aggregate liquidation preferences of those holders. In any such
distribution, the “liquidation preference” of any holder of Series A Preferred Stock or any Series
A Parity Securities means the amount otherwise payable to such holder in such distribution
(assuming no limitation on the corporation’s assets available for such distribution), including any
declared but unpaid dividends (and, in the case of any holder of stock other than the Series A
Preferred Stock on which dividends accrue on a cumulative basis, an amount equal to any unpaid,
accrued, cumulative dividends, whether or not declared, as applicable). If the liquidation
preference has been paid in full to all holders of Series A Preferred Stock and any Series A Parity
Securities, the holders of the corporation’s Series A Junior Securities shall be entitled to receive
all remaining assets of the corporation according to their respective rights and preferences.
(c) For purposes of this Section 5, neither the sale, conveyance, exchange, or transfer
of all or substantially all of the assets or business of the corporation for cash, securities, or other
property, nor the merger or consolidation of the corporation with any other entity, including a
merger or consolidation in which the holders of Series A Preferred Stock receive cash, securities,
or property for their shares, shall constitute a liquidation, dissolution, or winding-up of the
corporation.
6. Redemption.
(a) Series A Preferred Stock is not subject to any mandatory redemption, sinking fund,
or other similar provision. Series A Preferred Stock is not redeemable prior to March 29, 2028.
Shares of Series A Preferred Stock then outstanding will be redeemable at the option of the
corporation, in whole or in part, from time to time, on March 29, 2028, or on any Dividend
Payment Date on or after March 29, 2028, at a redemption price equal to $1,000 per share, plus
any declared and unpaid dividends, without accumulation of any undeclared dividends, to, but
excluding, the date of redemption. Holders of Series A Preferred Stock will have no right to require
the redemption or repurchase of Series A Preferred Stock. Notwithstanding the foregoing, within
90 days following the occurrence of a Regulatory Capital Treatment Event (as defined below), the
corporation, at its option, may redeem, at any time, all (but not less than all) of the shares of the
Series A Preferred Stock at the time outstanding, at a redemption price equal to $1,000 per share,
plus any declared and unpaid dividends, without accumulation of any undeclared dividends, upon
notice given as provided in sub-section (b) below. Any declared but unpaid dividends payable on
a redemption date that occurs subsequent to the record date for a Dividend Period shall not be paid
to the holder entitled to receive the redemption price on the redemption date, but rather shall be
paid to the holder of record of the redeemed shares on such record date relating to the Dividend
Payment Date as provided in Section 4(c) above. In all cases, the corporation may not redeem
shares of the Series A Preferred Stock without having received the prior approval of the Federal
7
Reserve or any successor Appropriate Federal Banking Agency if then required under capital rules
applicable to the corporation.
A “Regulatory Capital Treatment Event” means the good faith determination by the board
of directors or a duly authorized committee of the board of directors that, as a result of (i) any
amendment to, or change in, the laws, rules, or regulations of the United States or any political
subdivision of or in the United States (including, for the avoidance of doubt, any agency or
instrumentality of the United States, including the Federal Reserve and other federal banking
agencies) that is enacted or becomes effective after the initial issuance of any share of the Series
A Preferred Stock; (ii) any proposed change in those laws, rules, or regulations that is announced
after the initial issuance of any share of the Series A Preferred Stock; or (iii) any official
administrative decision or judicial decision or administrative action or other official
pronouncement interpreting or applying those laws, rules, or regulations or policies with respect
thereto that is announced after the initial issuance of any share of the Series A Preferred Stock,
there is more than an insubstantial risk that the corporation will not be entitled to treat the full
liquidation value of $1,000 per share of the Series A Preferred Stock then outstanding as “Tier 1
Capital” (or its equivalent) for purposes of the capital adequacy rules of the Federal Reserve (or,
as and if applicable, the capital adequacy rules or regulations of any successor Appropriate Federal
Banking Agency), as then in effect and applicable, for as long as any share of the Series A Preferred
Stock is outstanding.
(b) If shares of Series A Preferred Stock are to be redeemed, the notice of redemption
shall be given to the holders of record of Series A Preferred Stock to be redeemed by first class
mail, postage prepaid, addressed to the holders of record of such shares to be redeemed at their
respective last addresses appearing on the corporation’s stock register not less than 30 days nor
more than 60 days prior to the date fixed for redemption thereof. Each notice of redemption will
include a statement setting forth (i) the redemption date; (ii) the number of shares of Series A
Preferred Stock to be redeemed and, if less than all the shares held by such holder are to be
redeemed, the number of such shares to be redeemed from such holder; (iii) the redemption price;
and (iv) that dividends on the shares to be redeemed will cease to accrue on the redemption date.
If notice of redemption of any shares of Series A Preferred Stock has been duly given and if the
funds necessary for such redemption have been set aside by the corporation for the benefit of the
holders of any shares of Series A Preferred Stock so called for redemption, then, on and after the
redemption date, dividends will cease to accrue on such shares of Series A Preferred Stock; such
shares of Series A Preferred Stock shall no longer be deemed outstanding; and all rights of the
holders of such shares will terminate, except the right to receive the redemption price described in
sub-section (a) above, without interest.
(c) In case of any redemption of only part of the shares of Series A Preferred Stock at
the time outstanding, the shares to be redeemed shall be selected pro rata.
7. Voting Rights.
(a) Except as provided below and as determined by the board of directors or a duly
authorized committee of the board of directors or as expressly required by law, the holders of
shares of Series A Preferred Stock shall have no voting power, and no right to vote on any matter
at any time, either as a separate series or class or together with any other series or class of shares
8
of capital stock, and shall not be entitled to call a meeting of such holders for any purpose, nor
shall they be entitled to participate in any meeting of the holders of the common stock.
(b) So long as any shares of Series A Preferred Stock remain outstanding, the
affirmative vote or consent of the holders of at least two-thirds of all of the shares of Series A
Preferred Stock at the time outstanding, voting separately as a class, shall be required to: (i)
authorize, create, or issue, or increase the authorized amount of, shares of any class or series of
capital stock ranking senior to the Series A Preferred Stock with respect to payment of dividends
or the distribution of assets upon liquidation, dissolution, or winding up of the corporation, or issue
any obligation or security convertible into or exchangeable for, or evidencing the right to purchase,
any such class or series of the corporation’s capital stock; (ii) amend, alter, or repeal the provisions
of the Articles of Incorporation (including this Certificate of Designations), (including, unless no
vote on such merger or consolidation is required by Section 7(b)(iii)(B) below, any amendment,
alteration or repeal by means of a merger, consolidation, or otherwise), so as to adversely affect
the powers, preferences, privileges, or rights of Series A Preferred Stock, taken as a whole;
provided, however, that any amendment to authorize, create, or issue, or increase the authorized
amount of, Series A Preferred Stock, any Series A Junior Securities or any Series A Parity
Securities, or any securities convertible into or exchangeable for Series A Junior Securities or
Series A Parity Securities will not be deemed to adversely affect the powers, preferences,
privileges, or rights of Series A Preferred Stock; or (iii) complete a binding share exchange or
reclassification involving the Series A Preferred Stock, or complete the sale, conveyance,
exchange, or transfer of all or substantially all of the assets or business of the corporation or
consolidate with or merge into any other corporation, unless, in any case, the shares of Series A
Preferred Stock outstanding at the time of such consolidation or merger or sale either (A) remain
outstanding or (B) are converted into or exchanged for preference securities of the surviving entity
or any entity controlling the surviving entity having such rights, preferences, privileges, and
powers (including voting powers), taken as a whole, as are not materially less favorable to the
holders thereof than the rights, preferences, privileges, and powers (including voting powers) of
the Series A Preferred Stock, taken as a whole.
(c) The foregoing voting provisions will not apply if (i) at or prior to the time when the
act with respect to which such vote would otherwise be required shall be effected, all outstanding
shares of Series A Preferred Stock shall have been redeemed or called for redemption upon proper
notice and sufficient funds shall have been set aside by the corporation for the benefit of the holders
of Series A Preferred Stock to effect such redemption or (ii) such voting provisions are not
permitted under the corporate governance requirements of the Nasdaq Stock Market, LLC (or any
other exchange or automated quotation system on which the common stock of the corporation may
be listed or quoted).
(d) The rules and procedures for calling and conducting any meeting of the holders of
Series A Preferred Stock (including, without limitation, the fixing of a record date in connection
therewith), the solicitation and use of proxies at such a meeting, the obtaining of written consents,
and any other aspect or matter with regard to such meeting or such consents shall be governed by
any rules that the board of directors or any duly authorized committee of the board of directors, in
its discretion, may adopt from time to time, which rules and procedures shall conform to the
requirements of the Articles of Incorporation, the Bylaws, and applicable law.
9
8. No Conversion Rights. The holders of shares of Series A Preferred Stock shall not
have any rights to convert such shares into shares of any other class or series of securities of the
corporation.
9. No Preemptive Rights. The holders of shares of Series A Preferred Stock will have
no preemptive rights with respect to any shares of the corporation’s capital stock or any of its other
securities convertible into or carrying rights or options to purchase or otherwise acquire any such
capital stock or any interest therein, regardless of how any such securities may be designated,
issued, or granted.
10. No Certificates. The corporation may at its option issue shares of Series A Preferred
Stock without certificates.
11. Transfer Agent; Registrar. The corporation may appoint a transfer agent and
registrar for the Series A Preferred Stock.
12. Transfer; Restricted Legend. The shares of Series A Preferred Stock are “restricted
securities” under the Securities Act of 1933, as amended (the “Securities Act”) and accordingly,
may be resold, pledged or otherwise transferred only in compliance with the registration
requirements of federal and state securities laws or if exemptions from the Securities Act and
applicable state securities laws are available. The corporation may include a notation of the
restrictions on transfer in the records of the corporation or any transfer agent or registrar with
respect to any transfer of Series A Preferred Stock. Any certificates or other instruments
representing or notices of issuance relating to the shares of Series A Preferred Stock will bear a
restrictive legend in substantially the following form:
THE SECURITIES REFERENCED HEREIN HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), OR THE SECURITIES LAWS OF ANY STATE, AND MAY NOT BE
OFFERED, TRANSFERRED, PLEDGED, HYPOTHECATED, SOLD OR
OTHERWISE DISPOSED OF UNLESS A REGISTRATION STATEMENT
UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES
LAWS SHALL HAVE BECOME EFFECTIVE WITH REGARD THERETO, OR
AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT
AND APPLICABLE STATE SECURITIES LAWS IS AVAILABLE IN
CONNECTION WITH SUCH OFFER OR SALE.
13. No Other Rights. The shares of Series A Preferred Stock shall not have any rights,
preferences, privileges, or voting powers or relative, participating, optional, or other special rights,
or qualifications, limitations, or restrictions thereof, other than as set forth herein or in the Articles
of Incorporation, or as provided by applicable law.
[Signature page follows]
10
IN WITNESS WHEREOF, CrossFirst Bankshares, Inc. has caused this Certificate of
Designations to be signed by a duly authorized officer, this 29th day of March, 2023.
CROSSFIRST BANKSHARES, INC.
By: /s/ Amy Abrams
1
Exhibit 10.1
SECURITIES PURCHASE AGREEMENT
This SECURITIES PURCHASE AGREEMENT (this “Agreement”) is dated as of March
___, 2023, and is made by and between CrossFirst Bankshares, Inc., a Kansas corporation (the
“Company”), and each purchaser of the Series A Preferred Stock (as defined herein) identified on
the signature page hereto (each a “Purchaser” and collectively, the “Purchasers”).
RECITALS
WHEREAS
, the Company has requested that the Purchasers purchase Series A Preferred
Stock from the Company for a purchase price equal to the aggregate liquidation amount of such
Series A Preferred Stock, which aggregate amount is intended to qualify as Tier 1 Capital (as
defined herein);
WHEREAS
, each of the Purchasers is an “accredited investor” as such term is defined in
Rule 501(a) of Regulation D (“Regulation D”) promulgated under the Securities Act of 1933, as
amended (the “Securities Act”);
WHEREAS
,
the offer and sale of the Series A Preferred Stock by the Company is being
made in reliance upon the exemptions from registration available under Section 4(a)(2) of the
Securities Act and Rule 506(b) of Regulation D; and
WHEREAS
,
each Purchaser is willing to purchase from the Company shares of Series A
Preferred Stock in the aggregate liquidation amount set forth on such Purchaser’s signature page
hereto (the “Preferred Stock Amount”) in accordance with the terms, subject to the conditions and
in reliance on, the recitals, representations, warranties, covenants and agreements set forth herein
and in the Certificate of Designations.
NOW
,
, in consideration of the mutual covenants, conditions and
agreements herein contained and other good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the parties hereto hereby agree as follows:
AGREEMENT
1.
DEFINITIONS
.
1.1
Defined Terms.
the Certificate of Designations have the meanings defined or referenced below. Certain other
capitalized terms used only in specific sections of this Agreement may be defined in such sections.
“Affiliate(s)” means, with respect to any Person, such Person’s immediate family
members, partners, members or parent and Subsidiary corporations, and any other Person directly
or indirectly controlling, controlled by, or under common control with said Person and their
respective Affiliates.
“Agreement” has the meaning set forth in the preamble hereto.
2
“Bank” means CrossFirst Bank, a Kansas state chartered bank and wholly-owned
Subsidiary of the Company.
“Business
Day” means any day other than a Saturday, Sunday or any other day on which
banking institutions in the State of Kansas are permitted or required by any applicable law or
executive order to close.
“Bylaws” means the Bylaws of the Company, as in effect on the Closing Date.
“Certificate of Designations” means the Certificate of Designations designating the terms
and conditions of the Series A Preferred Stock substantially in the form attached hereto as
Exhibit A, as amended, restated, supplemented or modified from time to time.
“Charter” means the Articles of Incorporation of the Company, as amended and as in effect
on the Closing Date.
“Closing” has the meaning set forth in Section 2.2.
“Closing
Date” means March 29, 2023.
“Company” has the meaning set forth in the preamble hereto and shall include any
successors to the Company.
“Company Covered Person” has the meaning set forth in Section 4.2.4.
“Company’s
Reports” means (i) the Company’s Annual Report on Form 10-K for the year
ended December 31, 2022, as filed with the Securities and Exchange Commission on March 3,
2023, including the audited financial statements of the Company contained therein; (ii) the
Company’s Current Reports on Form 8-K, as filed with the Securities and Exchange Commission
on January 23, 2023 and February 22, 2023; (iii) the information specifically incorporated by
reference into the Company's Annual Report on Form 10-K for the year ended December 31, 2021
from its Definitive Proxy Statement on Schedule 14A, filed with the Securities and Exchange
Commission on March 25, 2022; (iv) the information specifically incorporated by reference into
the Company's Annual Report on Form 10-K for the year ended December 31, 2022 from its
Definitive Proxy Statement on Schedule 14A, as filed with the Securities and Exchange
Commission on March 24, 2023 and (v) the Company’s public reports for the year ended
December 31, 2022 and the periods ended March 31, 2022, June 30, 2022, September 30, 2022
and December 31, 2022 as filed with the FRB by the Company and with the FDIC by the Bank, as
required by regulations of the FRB and FDIC, respectively.
“control” (including the terms “controlling,” “controlled by” and “under common control
with”) means the possession, direct or indirect, of the power to direct or cause the direction of the
management and policies of a Person, whether through the ownership of voting securities, by
contract or otherwise.
“Disqualification Event” has the meaning set forth in Section 4.2.4.
3
“Equity
Interest” means any and all shares, interests, participations or other equivalents
(however designated) of capital stock of a corporation, any and all equivalent ownership interests
in a Person which is not a corporation, and any and all warrants, options or other rights to purchase
any of the foregoing.
“Exchange Act” means the Securities Exchange Act of 1934, as amended.
“FDIC” means the Federal Deposit Insurance Corporation.
“FRB” means the Board of Governors of the Federal Reserve System.
“GAAP” means generally accepted accounting principles in effect from time to time in the
United States of America.
“Governmental
Agency(ies)” means, individually or collectively, any federal, state, county
or local governmental department, commission, board, regulatory authority or agency (including,
without limitation, each applicable Regulatory Agency) with jurisdiction over the Company or any
of its Subsidiaries.
“Governmental
Licenses” has the meaning set forth in Section 4.3.
“Indebtedness” means: (i) all items arising from the borrowing of money that, according
to GAAP as in effect from time to time, would be included in determining total liabilities as shown
on the consolidated balance sheet of the Company; and (ii) all obligations secured by any lien on
property owned by the Company or any Subsidiary whether or not such obligations shall have been
assumed;
provided
,
however
, Indebtedness shall not include deposits or other indebtedness
created, incurred or maintained in the ordinary course of the Company’s or the Bank’s business
(including, without limitation, federal funds purchased, advances from any Federal Home Loan
Bank, secured deposits of municipalities, letters of credit issued by the Company or the Bank or
any other Subsidiary and repurchase arrangements) and consistent with customary banking
practices and applicable laws and regulations.
“Leases” means all leases, licenses or other documents providing for the use or occupancy
of any portion of any Property, including all amendments, extensions, renewals, supplements,
modifications, sublets and assignments thereof and all separate letters or separate agreements
relating thereto.
“Liquidation Preference” means $1,000 per share of Series A Preferred Stock.
“Material Adverse Effect” means any change or effect that (i) is or would be reasonably
likely to be material and adverse to the financial condition, results of operations or business of the
Company and its Subsidiaries, taken as a whole, or (ii) would materially impair the ability of the
Company and its Subsidiaries, taken as a whole, to perform their respective obligations under any
of the Transaction Documents, or otherwise materially impede the consummation of the
transactions contemplated hereby;
provided
,
however
, that “Material Adverse Effect” shall not be
deemed to include the impact of (1) changes in banking and similar laws, rules or regulations of
general applicability or interpretations thereof by Governmental Agencies, (2) changes in GAAP
or regulatory accounting requirements applicable to financial institutions and their holding
4
companies generally, (3) changes after the date of this Agreement in general economic or capital
market conditions affecting financial institutions or their market prices generally and not
specifically related to the Company or the Bank, (4) direct effects of compliance with this
Agreement on the operating performance of the Company or the Bank including expenses incurred
by the Company and the Bank in consummating the transactions contemplated by this Agreement,
(5) the effects of any action or omission taken by the Company with the prior written consent of
the Purchasers, and vice versa, or as otherwise contemplated by the Securities Purchase
Agreements by and between the Company and each Purchaser and the Certificate of Designations,
(6) the effects of any declaration of a state of emergency by the government of the United States
or any State of the United States; and (7) the effects of any epidemic, pandemic or disease outbreak,
or continuation or extension of any epidemic, pandemic or disease outbreak, affecting the United
States, provided in each case of the foregoing (1), (2), (3), (6) or (7) that the impact of any such
event, circumstance or state of facts shall be taken into account in determining whether a "Material
Adverse Effect" has occurred to the extent that such impact is disproportionately adverse to the
operations or business of the Company in comparison to other financial institutions with similar
operations.
“Person” means an individual, a corporation (whether or not for profit), a partnership, a
limited liability company, a joint venture, an association, a bank, a trust, an unincorporated
organization, a government or any department or agency thereof (including a Governmental
Agency) or any other entity or organization.
“Preferred Stock Amount” has the meaning set forth in the Recitals.
“Property” means any real property owned or leased by the Company or any controlled
Affiliate or Subsidiary of the Company.
“Purchaser” or “Purchasers” has the meaning set forth in the preamble hereto.
“Regulation D” has the meaning set forth in the Recitals.
“Regulatory Agency” means any federal or state agency charged with the supervision or
regulation of depository institutions or holding companies of depository institutions, or engaged
in the insurance of depository institution deposits, or any court, administrative agency or
commission or other authority, body or agency having supervisory or regulatory authority with
respect to the Company, the Bank or any of their Subsidiaries.
“Series A Preferred Stock” means the Company's Series A Non-Cumulative Perpetual
Preferred Stock, par value $0.01 per share.
“Securities Act” has the meaning set forth in the Recitals.
“Subsidiary” or “Subsidiaries” means with respect to any Person, any other Person in
which a majority of the outstanding Equity Interest is directly or indirectly owned by such Person.
“Tier 1 Capital” has the meaning given to the term “Tier 1 Capital” in 12 C.F.R. Part 217,
as amended, modified and supplemented and in effect from time to time or any replacement
thereof.
5
“Transaction Documents” means this Agreement and the Certificate of Designations.
1.2
Interpretations
. The foregoing definitions are equally applicable to both the
singular and plural forms of the terms defined. The words “hereof”, “herein” and “hereunder” and
words of like import when used in this Agreement shall refer to this Agreement as a whole and not
to any particular provision of this Agreement. The word “including” when used in this Agreement
without the phrase “without limitation,” shall mean “including, without limitation.” All references
to time of day herein are references to Central Time unless otherwise specifically provided. All
references to this Agreement and the Certificate of Designations shall be deemed to be to such
documents as amended, modified or restated from time to time. With respect to any reference in
this Agreement to any defined term, (i) if such defined term refers to a Person, then it shall also
mean all heirs, legal representatives and permitted successors and assigns of such Person, and (ii)
if such defined term refers to a document, instrument or agreement, then it shall also include any
amendment, replacement, extension or other modification thereof.
1.3
Exhibits Incorporated
. All Exhibits attached hereto are hereby incorporated into
this Agreement.
2.
PREFERRED STOCK
.
2.1
Certain Terms
. Subject to the terms and conditions herein contained, the
Company proposes to issue and sell to the Purchasers, severally and not jointly, Series A Preferred
Stock in an aggregate liquidation amount equal to the aggregate of the Preferred Stock Amounts.
The Purchasers, severally and not jointly, each agree to purchase the Series A Preferred Stock in
an amount equal to such Purchaser’s Preferred Stock Amount from the Company on the Closing
Date in accordance with the terms of, and subject to the conditions and provisions set forth in, this
Agreement and the Certificate of Designations. The Preferred Stock Amounts shall be disbursed
in accordance with Section 3.1.
2.2
Subscription Documents and Payment
. Unless otherwise waived by the
Company, no later than the close of business on March 27, 2023, the Purchaser shall deliver to the
Company:
(a) a copy of this Agreement duly signed the Purchaser with the Purchaser information on
the Purchaser signature pages duly completed, including the address of Purchaser and payment
instructions for any dividends that may become payable to Purchaser;
(b) payment to the Company of the Preferred Stock Amount for such Purchaser set forth
on such Purchaser’s respective signature pages to the Securities Purchase Agreements by (i) wire
transfer of immediately available funds, (ii) account debit authorization to the Bank or (iii) check
payable to the Company; and
(c) an IRS Form W-9 or one of the Forms W-8, as applicable, with respect to the Purchaser,
in form reasonably satisfactory to the Company to the effect that no federal income tax withholding
is required by the Company for any distribution or payment to the Purchaser, duly executed by the
Purchaser or the Purchaser’s beneficial owner(s), as applicable.
6
2.3
Treatment of Subscription Documents and Payment Pending Closing
. The
Company will hold the documents and payment submitted by each Purchaser to the Company
pursuant to Section 2.2 in escrow until such documents and payments are automatically released
at the Closing, provided that the Company reserves the right to reject in whole or in part any
proposed purchase of Preferred Stock by any Purchaser at any time prior to Closing.
2.4
The Closing
. The execution and delivery of the Transaction Documents by the
Company and the closing of the sale and purchase of the Series A Preferred Stock (the “Closing”)
shall occur remotely via electronic or other exchange of documents and signature pages, at 10:00
a.m. (Central Time) on the Closing Date, or at such other place or time or on such other date as
the parties hereto may agree.
2.5
No Right of Offset
. The Purchaser hereby expressly waives any right of offset it
may have against the Company or any of its Subsidiaries.
2.6
Use of Proceeds
. The Company shall use the net proceeds from the sale of Series
A Preferred Stock for general corporate purposes, which may include, without limitation, capital
injections into the Bank and other strategic growth opportunities.
3.
CLOSING
.
3.1
Closing
. At the Closing, , the documents and payments submitted to the Company
pursuant to Section 2.2, to the extent that any proposed purchase has not been rejected in whole or
in part by the Company prior to Closing, will automatically be released to the Company, and the
Company will execute and/or deliver to each applicable Purchaser of the Series A Preferred Stock,
evidence of issuance of the Series A Preferred Stock credited to book-entry accounts and the other
documents specified in Section 3.2.1.2.
3.2
Conditions Precedent to Closing
.
3.2.1
Conditions to the Purchasers’ Obligation.
Purchaser to consummate the purchase of the Series A Preferred Stock to be purchased by such
Purchaser at Closing is subject to delivery by or at the direction of the Company to such Purchaser
of each of the following (unless such Purchaser shall have waived such satisfaction or delivery):
3.2.1.1
Transaction Documents
. Each of the Transaction Documents
has been duly authorized and executed by the Company.
3.2.1.2
Authority Documents.
(a)
A
good standing certificate issued by the Kansas
Secretary of State with respect to the Company;
(b)
A copy, certified by the Secretary or Assistant
Secretary of the Company, of the resolutions of the Board of Directors of the Company, and any
committee thereof, authorizing the execution, delivery and performance of the Transaction
Documents; and
7
(c)
An incumbency certificate of the Secretary or Assistant
Secretary of the Company certifying the names of the officer or officers of the Company authorized
to sign the Transaction Documents and the other documents provided for in the Securities Purchase
Agreements by and between the Company and such Purchaser.
3.2.1.3
Other Documents
. Such other certificates, affidavits,
schedules, resolutions, notes and/or other documents which are provided for hereunder.
3.2.2
Conditions to the Company’s Obligation.
3.2.2.1
With respect to a given Purchaser, the obligation of the
Company to consummate the sale of the Series A Preferred Stock and to effect the Closing is
subject to delivery by or at the direction of such Purchaser, on or prior to the Closing Date, of each
of the following (unless the Company shall have waived such satisfaction or delivery):
(a)
The delivery to the Company of this Agreement duly
authorized and executed by such Purchaser; and
(b)
The delivery to the Company of the payment and
documents specified in Section 2.2.
4.
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
.
The Company hereby represents and warrants to each Purchaser as follows:
4.1
Organization and Authority
.
4.1.1
Organization Matters of the Company and Its Subsidiaries
.
4.1.1.1
The Company is a duly organized corporation, is validly existing
and in good standing under the laws of the State of Kansas and has all requisite corporate power
and authority to conduct its business and activities as presently conducted, to own its properties,
and to perform its obligations under the Transaction Documents. The Company is duly qualified
as a foreign corporation to transact business and is in good standing in each other jurisdiction in
which such qualification is required, whether by reason of the ownership or leasing of property or
the conduct of business, except where the failure to so qualify or to be in good standing would not
reasonably be expected to result in a Material Adverse Effect. The Company is duly registered as
a bank holding company under the Bank Holding Company Act of 1956, as amended.
4.1.1.2
Each Subsidiary of the Company (other than the Bank) either
has been duly organized and is validly existing as a corporation or limited liability company, or,
in the case of the Bank, has been duly chartered and is validly existing as a state chartered bank,
in each case in good standing under the laws of the jurisdiction of its incorporation, has the
corporate or similar power and authority to own, lease and operate its properties and to conduct its
business and is duly qualified as a foreign corporation to transact business and is in good standing
in each jurisdiction in which such qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except where the failure to so qualify or to be in
good standing would not result in a Material Adverse Effect. All of the issued and outstanding
8
shares of capital stock or other equity interests in each Subsidiary of the Company have been duly
authorized and validly issued, are fully paid and non-assessable (to the extent that such concepts
are applicable to interests in such entities in any such jurisdiction) and are owned by the Company,
directly or through Subsidiaries of the Company.
4.1.1.3
The Bank is a Kansas state chartered bank. The deposit accounts
of the Bank are insured by the FDIC up to applicable limits. The Bank has not received any notice
or other information indicating that the Bank is not an “insured depository institution” as defined
in 12 U.S.C. Section 1813, nor has any event occurred which could reasonably be expected to
adversely affect the status of the Bank as an FDIC-insured institution.
4.1.2
Capital Stock and Related Matters
. The Charter of the Company
authorizes the Company to issue 200,000,000 shares of common stock with a par value of $0.01
per share, and 5,000,000 shares of preferred stock, $0.01 par value per share. As of March 17,
2023, 48,596,007 shares of common stock were outstanding. Immediately prior to the Closing
Date, no shares of preferred stock are outstanding. All of the outstanding capital stock of the
Company has been duly authorized and validly issued and is fully paid and non-assessable. Except
pursuant to the Company’s equity incentive plans duly adopted by the Company’s Board of
Directors and warrants to purchase common stock of the Company disclosed in the Company's
Reports, there are, as of the date hereof, no outstanding options, rights, warrants or other
agreements or instruments obligating the Company to issue, deliver or sell, or cause to be issued,
delivered or sold, additional shares of the capital stock of the Company or obligating the Company
to grant, extend or enter into any such agreement or commitment to any Person other than the
Company.
4.2
No Impediment to Transactions
.
4.2.1
Transaction is Legal and Authorized
. The issuance of the Series A
Preferred Stock, the execution of the Transaction Documents and compliance by the Company
with all of the provisions of the Transaction Documents are within the corporate powers of the
Company.
4.2.2
Agreement
. This Agreement has been duly authorized, executed and
delivered by the Company, and, assuming due authorization, execution and delivery by the
Purchasers, constitutes the legal, valid and binding obligation of the Company, enforceable against
the Company in accordance with its terms, except as enforcement thereof may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to or affecting
creditors’ rights generally or by general equitable principles.
4.2.3
Series A Preferred Stock.
The Series A Preferred Stock has been duly
authorized by the Company and when issued by the Company and delivered to and paid for by the
Purchasers in accordance with the terms of the Securities Purchase Agreements by and between
the Company and each Purchaser, will have been validly issued, shall be fully paid and non-
assessable, and shall be free and clear of all liens and restrictions on transfer, except for restrictions
on transfer set forth in the Transaction Documents or imposed by applicable securities laws.
9
4.2.4
Exemption from Registration.
Subsidiaries or Affiliates, nor any Person acting on its or their behalf, has engaged in any form of
general solicitation or general advertising (within the meaning of Regulation D) in connection with
the offer or sale of the Series A Preferred Stock. Assuming the accuracy of the representations
and warranties of each of the Purchasers set forth in the Securities Purchase Agreements by and
between the Company and the Purchaser, the Series A Preferred Stock will be issued in a
transaction exempt from the registration requirements of the Securities Act. No “bad actor”
disqualifying event described in Rule 506(d)(1)(i)-(viii) of the Securities Act (a “Disqualification
Event”) is applicable to the Company or, to the Company’s knowledge, any Person described in
Rule 506(d)(1) of Regulation D (each, a “Company Covered Person”). The Company has
exercised reasonable care to determine whether any Company Covered Person is subject to a
Disqualification Event. The Company has to its knowledge disclosed any information required to
be disclosed by the Company under Rule 506(e) of Regulation D.
4.2.5
No Defaults or Restrictions
. Neither the execution and delivery of the
Transaction Documents by the Company nor the compliance by the Company with their respective
terms and conditions will (whether with or without the giving of notice or lapse of time or both)
(i) violate, conflict with or result in a breach of, or constitute a default under: (1) the Charter or
Bylaws of the Company; (2) any of the terms, obligations, covenants, conditions or provisions of
any corporate restriction or of any material contract, agreement, indenture, mortgage, deed of trust,
pledge, bank loan or credit agreement, or any other agreement or instrument to which the Company
or Bank, as applicable, is now a party or by which it or any of its properties may be bound or
affected; (3) any judgment, order, writ, injunction, decree or demand of any court, arbitrator, grand
jury, or Governmental Agency applicable to the Company or the Bank; or (4) any statute, rule or
regulation applicable to the Company, except, in the case of items (2), (3) or (4), for such violations
and conflicts, breaches and default that would not, singularly or in the aggregate, result in a
Material Adverse Effect, or (ii) result in the creation or imposition of any lien, charge or
encumbrance of any nature whatsoever upon any property or asset of the Company that would
result in a Material Adverse Effect.
4.2.6
Governmental Consent
. No governmental orders, permissions,
consents, approvals or authorizations are required to be obtained by the Company that have not
been obtained, and no registrations or declarations are required to be filed by the Company that
have not been filed in connection with, or, in contemplation of, the execution and delivery of, and
performance under, the Transaction Documents, except for applicable requirements, if any, of the
Securities Act, the Exchange Act or state securities laws or “blue sky” laws of the various states
and any applicable federal or state banking laws and regulations.
4.3
Possession of Licenses and Permits
. The Company and each of its Subsidiaries
possess such permits, licenses, approvals, consents and other authorizations (collectively,
“Governmental Licenses”) issued by the appropriate Governmental Agencies necessary to conduct
the business now operated by them except where the failure to possess such Governmental
Licenses would not, singularly or in the aggregate, have a Material Adverse Effect. The Company
and each Subsidiary of the Company is in compliance with the terms and conditions of all such
Governmental Licenses, except where the failure to so comply would not, individually or in the
aggregate, have a Material Adverse Effect.
10
4.4
Financial Condition
.
4.4.1
Company Financial Statements
. The financial statements of the
Company included in the Company’s Reports (including the related notes, where applicable),
which have been provided or are available publicly to the Purchasers (i) have been prepared from,
and are in accordance with, the books and records of the Company; (ii) fairly present in all material
respects the results of operations, cash flows, changes in stockholders’ equity and financial
position of the Company and its consolidated Subsidiaries, for the respective fiscal periods or as
of the respective dates therein set forth (subject in the case of unaudited statements to recurring
year-end audit adjustments normal in nature and amount), as applicable; (iii) complied as to form,
as of their respective dates of filing in all material respects with applicable accounting and banking
requirements as applicable, with respect thereto; and (iv) have been prepared in accordance with
GAAP consistently applied during the periods involved, except, in each case, as indicated in such
statements or in the notes thereto. The books and records of the Company have been, and are
being, maintained in all material respects in accordance with GAAP and any other applicable legal
and accounting requirements. The Company does not have any material liability required to be
reflected or reserved against on the consolidated balance sheet of the Company, except for those
liabilities that are reflected or reserved against on the consolidated balance sheet of the Company
contained in the Company’s Reports for the Company’s most recently completed quarterly or
annual fiscal period, as applicable, and for liabilities incurred in the ordinary course of business
consistent with past practice or in connection with this Agreement and the transactions
contemplated hereby.
4.4.2
Solvency
. After giving effect to the consummation of the transactions
contemplated by this Agreement, the Company is solvent and able to pay its debts as they mature.
No transfer of property is being made and no Indebtedness is being incurred in connection with
the transactions contemplated by this Agreement with the intent to hinder, delay or defraud either
present or future creditors of the Company or any Subsidiary of the Company.
4.4.3
Ownership of Property
. The Company and each of its Subsidiaries has
good and marketable title as to all real property owned by it and good title to all assets and
properties owned by the Company and such Subsidiary in the conduct of its businesses, whether
such assets and properties are real or personal, tangible or intangible, including assets and property
reflected in the most recent balance sheet contained in the Company’s Reports or acquired
subsequent thereto (except to the extent that such assets and properties have been disposed of in
the ordinary course of business, since the date of such balance sheet), subject to no encumbrances,
liens, mortgages, security interests or pledges, except (i) those items which secure liabilities for
public or statutory obligations or any discount with, borrowing from or other obligations to the
Federal Home Loan Bank, inter-bank credit facilities, reverse repurchase agreements or any
transaction by the Bank acting in a fiduciary capacity, (ii) statutory liens for amounts not yet due
or delinquent or which are being contested in good faith and (iii) such as do not result, individually
or in the aggregate, in a Material Adverse Effect. The Company and each of its Subsidiaries, as
lessee, has the right under valid and existing Leases of real and personal properties that are material
to the Company or such Subsidiary, as applicable, in the conduct of its business to occupy or use
all such properties as presently occupied and used by it.
11
4.5
No Material Adverse Change
. Since the end of the Company’s last fiscal year
ended December 31, 2022, there has been no development or event that has had or would
reasonably be expected to have, singularly or in the aggregate, a Material Adverse Effect.
4.6
Legal Matters
.
4.6.1
Compliance with Law
. The Company and each of its Subsidiaries (i) is
in compliance with, and at all times within three (3) years prior to the date hereof has been in
compliance with and (ii) to the Company’s knowledge, is not under investigation with respect to,
and, to the Company’s knowledge, has not been threatened to be charged with or given any notice
of any material violation of, any applicable statutes, rules, regulations, orders and restrictions of
any domestic or foreign government, or any instrumentality or agency thereof, having jurisdiction
over the conduct of its business or the ownership of its properties, except where any such failure
to comply or violation would not reasonably be expected to have, singularly or in the aggregate, a
Material Adverse Effect.
4.6.2
Pending Litigation
. There are no actions, suits, proceedings or written
agreements pending, or, to the Company’s knowledge, threatened or proposed, against the
Company or any of its Subsidiaries at law or in equity before or by any Governmental Agency,
that would reasonably be expected to have, singularly or in the aggregate, a Material Adverse
Effect, or materially and adversely affect the issuance of the Series A Preferred Stock.
4.6.3
Brokerage Commissions
. Neither the Company nor any Subsidiary of
the Company is obligated to pay any brokerage commission, placement fee or finder’s fee to any
Person in connection with the transactions contemplated by this Agreement.
4.6.4
Investment Company Act
. Neither the Company nor any of its
Subsidiaries is an “investment company” or a company “controlled” by an “investment company,”
within the meaning of the Investment Company Act of 1940, as amended.
4.7
Representations and Warranties Generally
. The representations and warranties
of the Company set forth in this Agreement that do not contain a “Material Adverse Effect”
qualification or other express materiality or similar qualification are true and correct in all material
respects (i) as of the Closing Date and (ii) as otherwise specifically provided herein. The
representations and warranties of the Company set forth in this Agreement that contain a “Material
Adverse Effect” qualification or any other express materiality or similar qualification are true and
correct (a) as of the Closing Date and (b) as otherwise specifically provided herein.
5.
GENERAL COVENANTS, CONDITIONS AND AGREEMENTS
.
The Company hereby further covenants and agrees with the Purchaser as follows:
5.1
Compliance with Transaction Documents
. The Company shall comply with,
observe and timely perform each and every one of its covenants, agreements and obligations under
the Transaction Documents.
5.2
Compliance with Laws
. The Company shall comply and cause the Bank and each
of its other Subsidiaries to comply with all applicable statutes, rules, regulations, orders and
12
restrictions in respect of the conduct of its business and the ownership of its properties, except, in
each case, where such noncompliance would not reasonably be expected to have, singularly or in
the aggregate, a Material Adverse Effect.
5.3
Corporate Existence
. Except as provided in the Certificate of Designations, the
Company shall do or cause to be done all things reasonably necessary to maintain, preserve and
renew its corporate existence;
provided
,
, that the Company may consummate a merger in
which (a) the Company is the surviving entity or (b) if the Company is not the surviving entity,
the surviving entity assumes, by operation of law or otherwise, all of the obligations of the
Company under the Certificate of Designations.
5.4
Tier 1 Capital
. If all or any portion of the full liquidation value of the Series A
Preferred Stock ceases to be eligible, or there is a material risk that all or any portion of the full
liquidation value of the Series A Preferred Stock will cease to be eligible to qualify as Tier 1
Capital, the Company will immediately notify the holders of record of the Series A Preferred
Stock, and thereafter, if requested by the Company, the Company and holders of record of the
Series A Preferred Stock will work together in good faith to execute and deliver all agreements as
reasonably necessary in order to restructure the applicable portions of the obligations evidenced
by the Series A Preferred Stock to be eligible to qualify as Tier 1 Capital;
provided
,
however
, that
nothing contained in this Agreement shall limit the Company’s right to redeem the holders of
record of the Series A Preferred Stock upon the occurrence of a Regulatory Capital Treatment
Event as described in the Certificate of Designations.
5.5
Absence of Control
. It is the intent of the parties to this Agreement that in no event
shall any Purchaser, by reason of any of the Transaction Documents, be deemed to control, directly
or indirectly, the Company, and no Purchasers shall exercise, or be deemed to exercise, directly or
indirectly, a controlling influence over the management or policies of the Company.
5.6
Rule 144A Information
. While any shares of the Series A Preferred Stock remain
“restricted securities” within the meaning of the Securities Act, the Company will make available,
upon request, to any seller of such Series A Preferred Stock the information specified in Rule
144A(d)(4) under the Securities Act, unless the Company is then subject to Section 13 or 15(d) of
the Exchange Act.
5.7
Public Announcement
. The Company and each Purchaser agree that no public
release, statement, announcement, or other disclosure detailing the purchase of shares of the Series
A Preferred Stock pursuant to this Agreement that refers to the other party or parties by name shall
be issued by any party without the prior written consent of the other party so named (which consent
shall not be unreasonably withheld, conditioned or delayed), except as otherwise required by law
or the applicable rules or regulations of any securities exchange or securities market, in which case
the Company shall allow the Purchasers reasonable time to comment on such release or
announcement in advance of such issuance. Notwithstanding the foregoing, if the Purchaser is a
director or officer as defined in the rules promulgated by Section 16 of the Exchange Act, or an
executive officer as defined under the Exchange Act, such Purchaser acknowledges that disclosure
of his, her or its participation will be publicly disclosed.
13
5.8
Redemption
. Any redemption made pursuant to the terms of the Certificate of
Designations shall be made on a pro rata basis.
6.
REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE
PURCHASER
.
The Purchaser hereby represents and warrants to the Company, and covenants with the
Company as follows:
6.1
Legal Power and Authority
. If the Purchaser is an entity, the Purchaser has all
necessary power and authority to execute, deliver and perform the Purchaser’s obligations under
this Agreement and to consummate the transactions contemplated hereby. If the Purchaser is an
entity, the Purchaser is an entity duly organized, validly existing and in good standing under the
laws of its jurisdiction of organization. If the Purchaser is a natural person, the Purchaser has the
legal capacity to execute, deliver and perform the Purchaser’s obligations under this Agreement
and to consummate the transactions contemplated hereby.
6.2
Authorization and Execution
. The execution, delivery and performance of this
Agreement has been duly authorized by all necessary action on the part of the Purchaser, and this
Agreement has been duly executed and delivered by the Purchaser, assuming due authorization,
execution and delivery by the Company, this Agreement is a legal, valid and binding obligation of
the Purchaser, enforceable against the Purchaser in accordance with its terms, except as
enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or
other similar laws relating to or affecting creditors’ rights generally or by general equitable
principles.
6.3
No Conflicts
. Neither the execution, delivery or performance of the Transaction
Documents nor the consummation of any of the transactions contemplated thereby will conflict
with, violate, constitute a breach of or a default (whether with or without the giving of notice or
lapse of time or both) under (i) if Purchaser is an entity, the Purchaser’s organizational documents,
(ii) any agreement to which the Purchaser is party, (iii) any law applicable to the Purchaser or (iv)
any order, writ, judgment, injunction, decree, determination or award binding upon or affecting
the Purchaser.
6.4
Purchase for Investment
. The Purchaser is purchasing the Series A Preferred
Stock for its, his or her own account and not with a view to distribution and with no present
intention of reselling, distributing or otherwise disposing of the same. The Purchaser has no
present or contemplated agreement, undertaking, arrangement, obligation, Indebtedness or
commitment providing for, or which is likely to compel, a disposition of the Series A Preferred
Stock in any manner.
6.5
Accredited Investor
. The Purchaser has reviewed the definition of “accredited
investor” as such term is defined in Rule 501 of Regulation D and such Purchaser is and will be
on the Closing Date an “accredited investor”. If an entity, the Purchaser was not formed for the
specific purpose of acquiring the Series A Preferred Stock.
6.6
Financial and Business Sophistication
. The Purchaser has such knowledge and
experience in financial and business matters that the Purchaser is capable of evaluating the merits
14
and risks of the prospective investment in the Series A Preferred Stock. The Purchaser has relied
solely upon its, his or her own knowledge of, and/or the advice of its, his or her own legal, financial,
tax or other advisors with regard to, the legal, financial, tax and other considerations involved in
deciding to invest in the Series A Preferred Stock.
6.7
Ability to Bear Economic Risk of Investment
. The Purchaser recognizes that an
investment in the Series A Preferred Stock is a speculative investment that involves substantial
risk, including risks related to the Company’s business, operating results, financial condition and
cash flows, which risks the Purchaser has carefully considered in connection with making an
investment in the Series A Preferred Stock. The Purchaser has the ability to bear the economic
risk of the prospective investment in the Series A Preferred Stock, including the ability to hold the
Series A Preferred Stock indefinitely, and further including the ability to bear a complete loss of
all of its, his or her investment in the Company.
6.8
Information
. The Purchaser acknowledges that (i) the Purchaser is not being
provided with the disclosures that would be required if the offer and sale of the Series A Preferred
Stock were registered under the Securities Act; (ii) the Purchaser has conducted its, his or her own
examination of the Company and the terms of the Series A Preferred Stock to the extent the
Purchaser deems necessary to make its, his or her decision to invest in the Series A Preferred
Stock; (iii) the Purchaser has reviewed publicly available financial and other information
concerning the Company to the extent the Purchaser deems necessary to make its, his or her
decision to purchase the Series A Preferred Stock (including meeting with representatives of the
Company); and (iv) the Purchaser has not received nor relied on any form of general solicitation
or general advertising (within the meaning of Regulation D) from the Company in connection with
the offer and sale of the Series A Preferred Stock. The Purchaser has reviewed the information set
forth in the Company’s Reports, the exhibits hereto and any additional information provided by
the Company in connection with the transactions contemplated by this Agreement.
6.9
Access to Information
. The Purchaser acknowledges that the Purchaser and its,
his or her advisors have been furnished with all materials relating to the business, finances and
operations of the Company that have been requested by them and have been given the opportunity
to ask questions of, and to receive answers from, persons acting on behalf of the Company
concerning terms and conditions of the transactions contemplated by this Agreement and to obtain
any additional information from the Company that is necessary to verify the accuracy of
information made available to the Purchaser,
in order to make an informed and voluntary decision
to enter into this Agreement.
6.10
Investment Decision
. The Purchaser has made its, his or her own investment
decision based upon the Purchaser's own judgment, due diligence and advice from such advisors
as the Purchaser has deemed necessary and not upon any view expressed by any other Person,
including the Company. Neither such inquiries nor any other due diligence investigations
conducted by the Purchaser or its, his or her advisors or representatives, if any, shall modify, amend
or affect the Purchaser's right to rely on the Company’s representations and warranties contained
herein. The Purchaser is not relying upon, and has not relied upon, any advice, statement,
representation or warranty made by any Person by or on behalf of the Company, except for the
express statements, representations and warranties of the Company made or contained in this
Agreement. Furthermore, the Purchaser acknowledges that nothing in this Agreement or any other
15
materials presented by or on behalf of the Company to the Purchaser in connection with the
purchase of the Series A Preferred Stock constitutes legal, tax or investment advice.
6.11
Private Placement; No Registration; Restricted Legends
. The Purchaser
understands and acknowledges that the shares of Series A Preferred Stock are “restricted
securities” under the Securities Act and are being sold by the Company without registration under
the Securities Act in reliance on the exemption from federal and state registration set forth in,
respectively, Rule 506(b) of Regulation D promulgated under Section 4(a)(2) of the Securities Act
and Section 18 of the Securities Act, or any applicable state securities laws, and accordingly, may
be resold, pledged or otherwise transferred only in compliance with the registration requirements
of federal and state securities laws or if exemptions from the Securities Act and applicable state
securities laws are available to the Purchaser. The Purchaser is not subscribing for the Series A
Preferred Stock as a result of or subsequent to any advertisement, article, notice or other
communication published in any newspaper, magazine or similar media or broadcast over
television or radio, or presented at any seminar or meeting. The Purchaser has not been solicited
with respect to investment in the Series A Preferred Stock except in the jurisdiction of its, his or
her address appearing on the Purchaser’s signature page to this Agreement. The Purchaser further
acknowledges its, his or her primary responsibilities under the Securities Act and applicable state
securities laws and, accordingly, will not sell or otherwise transfer the Series A Preferred Stock or
any interest therein without complying with the requirements of the Securities Act and the rules
and regulations promulgated thereunder, applicable state securities laws and the requirements set
forth in this Agreement. The Company has not and is not making any representation, warranty or
covenant, express or implied, as to the availability of any exemption from registration under the
Securities Act or any applicable state securities laws for the resale, pledge or other transfer of the
Series A Preferred Stock, or that the Series A Preferred Stock purchased by the Purchaser will ever
be able to be lawfully resold, pledged or otherwise transferred. The Purchaser further
acknowledges and agrees that a notation of the restrictions on transfer will be included in the
records of the Company and any transfer agent or registration with respect to any transfer of the
Series A Preferred Stock and any certificate or instruments representing or notice of issuance
relating to such Series A Preferred Stock may bear at issuance a restrictive legend in substantially
the following form:
“The securities referenced herein have not been registered under the Securities Act
of 1933, as amended (the “Securities Act”), or the securities laws of any state, and
may not be offered, transferred, pledged, hypothecated, sold or otherwise disposed
of unless a registration statement under the Securities Act and applicable state
securities laws shall have become effective with regard thereto, or an exemption
from registration under the Securities Act and applicable state securities laws is
available in connection with such offer or sale.”
6.12
Tier 1 Capital
. If the Company provides notice as contemplated in Section 5.4
(Tier 1 Capital) of the occurrence of the event contemplated in such section, thereafter the
Company and the Purchaser will work together in good faith to execute and deliver all agreements
as reasonably necessary in order to restructure the Series A Preferred Stock to be eligible to qualify
as Tier 1 Capital;
provided
,
however
, that nothing contained in this Agreement shall limit the
Company’s right to redeem the Series A Preferred Stock upon the occurrence of a Regulatory
Capital Treatment Event as described in the Certificate of Designations.
16
6.13
Not Debt of the Bank; Not Savings Accounts, Etc
. The Purchaser acknowledges
that the Company is a bank holding company and the Company’s rights and the rights of the
Company’s creditors, including, the holders of record of shares of Series A Preferred Stock, to
participate in the assets of any Subsidiary during its liquidation or reorganization are structurally
subordinate to the prior claims of the Subsidiary’s creditors. The Purchaser acknowledges and
agrees that shares of Series A Preferred Stock are not savings accounts or deposits of the Bank and
are not insured or guaranteed by the FDIC or any Governmental Agency, and that no Governmental
Agency has passed upon or will pass upon the offer or sale of the Series A Preferred Stock or has
made or will make any finding or determination as to the fairness of this investment.
6.14
Accuracy of Representations
. The Purchaser understands that the Company is
relying and will rely upon the truth and accuracy of the foregoing representations,
acknowledgements and agreements in connection with the transactions contemplated by this
Agreement, and agrees that if any of the representations or acknowledgements made by the
Purchaser are no longer accurate as of the Closing Date, or if any of the agreements made by the
Purchaser are breached on or prior to the Closing Date, the Purchaser shall promptly notify the
Company.
6.15
Representations and Warranties Generally
. The representations and warranties
of the Purchaser set forth in this Agreement are true and correct as of the date hereof and will be
true and correct as of the Closing Date and as otherwise specifically provided herein. Any
certificate signed by a duly authorized representative of such Purchaser and delivered to the
Company or to counsel for the Company shall be deemed to be a representation and warranty by
the Purchaser to the Company as to the matters set forth therein.
7.
MISCELLANEOUS
.
7.1
Time of the Essence
. Time is of the essence for this Agreement.
7.2
Waiver or Amendment
. No waiver or amendment of any term, provision,
condition, covenant or agreement herein shall be effective unless in writing and signed by the
parties hereto. Failure on the part of the Purchasers to complain of any acts or failure to act,
irrespective of how long such failure continues, shall not constitute a waiver by the Purchasers of
their rights hereunder or impair any rights, powers or remedies on account of any breach or default
by the Company.
7.3
Severability
. Any provision of this Agreement which is unenforceable or invalid
or contrary to law, or the inclusion of which would adversely affect the validity, legality or
enforcement of this Agreement, shall be of no effect and, in such case, all the remaining terms and
provisions of this Agreement shall subsist and be fully effective according to the tenor of this
Agreement the same as though any such invalid portion had never been included herein.
Notwithstanding any of the foregoing to the contrary, if any provisions of this Agreement or the
application thereof are held invalid or unenforceable only as to particular Persons or situations, the
remainder of this Agreement, and the application of such provision to Persons or situations other
than those to which it shall have been held invalid or unenforceable, shall not be affected thereby,
but shall continue valid and enforceable to the fullest extent permitted by law.
17
7.4
Notices
. Any notice which any party hereto may be required or may desire to give
hereunder shall be deemed to have been given if in writing and if delivered personally, or if mailed,
postage prepaid, by United States registered or certified mail, return receipt requested, or if
delivered by a responsible overnight commercial courier promising next business day delivery, or
if by email with confirmation of transmission, addressed:
if to the Company:
CrossFirst Bankshares, Inc.
11440 Tomahawk Creek Pkwy
Leawood, Kansas 66211
Attention: Amy Abrams, General Counsel
E-mail: legal@crossfirst.com
with a copy to:
Stinson LLP
1201 Walnut Street, Suite 2900
Kansas City, Missouri 64106
Attention: Scott Gootee
E-mail: scott.gootee@stinson.com
if to the Purchaser:
To the address indicated on the Purchaser’s
signature page to this Agreement.
or to such other address or addresses as the party to be given notice may have furnished in writing
to the party seeking or desiring to give notice, as a place for the giving of notice;
provided
change in address shall be effective until five (5) Business Days after being given to the other party
in the manner provided for above. Any notice given in accordance with the foregoing shall be
deemed given when delivered personally or, if mailed, three (3) Business Days after it shall have
been deposited in the United States mails as aforesaid or, if sent by overnight courier, the Business
Day following the date of delivery to such courier (provided next Business Day delivery was
requested).
7.5
Successors and Assigns
. This Agreement shall inure to the benefit of the parties
and their respective heirs, legal representatives, successors and assigns. Except as expressly
provided in this Agreement, this Agreement shall not be construed so as to confer any right or
benefit upon any Person other than the parties to this Agreement and their respective successors
and permitted assigns.
7.6
No Joint Venture
. Nothing contained herein or in any document executed
pursuant hereto and no action or inaction whatsoever on the part of the Purchaser, shall be deemed
to make a Purchaser a partner or joint venturer with the Company.
7.7
Entire Agreement
. The Transaction Documents, along with any exhibits hereto
and thereto, constitute the entire agreement between the parties hereto with respect to the subject
matter hereof and may not be modified or amended in any manner other than by supplemental
written agreement executed by the parties hereto. No party, in entering into this Agreement, has
relied upon any representation, warranty, covenant, condition or other term that is not set forth in
the Transaction Documents.
7.8
Choice of Law; Jurisdiction for Disputes
. This Agreement shall be governed by
and construed in accordance with the laws of the State of Kansas without giving effect to its laws
18
or principles of conflict of laws. Nothing herein shall be deemed to limit any rights, powers or
privileges which the Purchaser may have pursuant to any law of the United States of America or
any rule, regulation or order of any department or agency thereof and nothing herein shall be
deemed to make unlawful any transaction or conduct by the Purchaser which is lawful pursuant
to, or which is permitted by, any of the foregoing.
VENUE FOR ANY CAUSE OF ACTION
ARISING FROM THIS AGREEMENT WILL LIE IN STATE OR FEDERAL COURTS WITH
JURISDICTION OVER JOHNSON COUNTY, KANSAS.
7.9
No Third Party Beneficiary
. This Agreement is made for the sole benefit of the
Company and the Purchasers, and no other Person shall be deemed to have any privity of contract
hereunder nor any right to rely hereon to any extent or for any purpose whatsoever, nor shall any
other Person have any right of action of any kind hereon or be deemed to be a third party
beneficiary hereunder.
7.10
Legal Tender of United States
. All payments hereunder shall be made in coin or
currency which at the time of payment is legal tender in the United States of America for public
and private debts.
7.11
Captions; Counterparts
. Captions contained in this Agreement in no way define,
limit or extend the scope or intent of their respective provisions. This Agreement may be executed
in any number of counterparts and by different parties hereto in separate counterparts, each of
which when so executed and delivered shall be deemed to be an original and all of which taken
together shall constitute but one and the same instrument. In the event that any signature is
delivered by facsimile transmission, or by e-mail delivery of a “.pdf” format data file, such
signature shall create a valid and binding obligation of the party executing (or on whose behalf
such signature is executed) with the same force and effect as if such facsimile signature page were
an original thereof. Any use by a party of an electronic signature must be in accordance with the
federal Electronic Signature In Global and National Commerce Act.
7.12
Knowledge; Discretion
. All references herein to the Purchaser’s (if the Purchaser
is an entity) or the Company’s knowledge shall be deemed to mean the knowledge of such party
based on the actual knowledge of such party’s Chief Executive Officer and Chief Financial Officer
or such other persons holding equivalent offices. Unless specified to the contrary herein, all
references herein to an exercise of discretion or judgment by the Purchaser, to the making of a
determination or designation by the Purchaser, to the application of the Purchaser’s discretion or
opinion, to the granting or withholding of the Purchaser’s consent or approval, to the consideration
of whether a matter or thing is satisfactory or acceptable to the Purchaser, or otherwise involving
the decision making of the Purchaser, shall be deemed to mean that the Purchaser shall decide
using the reasonable discretion or judgment of a prudent lender.
7.13
Waiver of Right to Jury Trial
. TO THE EXTENT PERMITTED UNDER
APPLICABLE LAW, THE PARTIES HERETO HEREBY KNOWINGLY, VOLUNTARILY
AND INTENTIONALLY WAIVE ANY RIGHT THAT THEY MAY HAVE TO A TRIAL BY
JURY IN ANY LITIGATION ARISING IN ANY WAY IN CONNECTION WITH ANY OF
THE TRANSACTION DOCUMENTS, OR ANY OTHER STATEMENTS OR ACTIONS OF
THE COMPANY OR THE PURCHASERS. THE PARTIES HERETO ACKNOWLEDGE
THAT THEY HAVE BEEN REPRESENTED IN THE SIGNING OF THIS AGREEMENT AND
19
IN THE MAKING OF THIS WAIVER BY INDEPENDENT LEGAL COUNSEL SELECTED
OF THEIR OWN FREE WILL. THE PARTIES HERETO FURTHER ACKNOWLEDGE THAT
(I) THEY HAVE READ AND UNDERSTAND THE MEANING AND RAMIFICATIONS OF
THIS WAIVER, (II) THIS WAIVER HAS BEEN REVIEWED BY THE PARTIES HERETO
AND THEIR COUNSEL AND IS A MATERIAL INDUCEMENT FOR ENTRY INTO THIS
AGREEMENT AND (III) THIS WAIVER SHALL BE EFFECTIVE AS TO EACH OF SUCH
TRANSACTION DOCUMENTS AS IF FULLY INCORPORATED THEREIN.
7.14
Expenses
. Except as otherwise provided in this Agreement, each of the parties will
bear and pay all other costs and expenses incurred by it or on its behalf in connection with the
transactions contemplated pursuant to this Agreement.
7.15
Survival
. Each of the representations and warranties set forth in this Agreement
shall survive the consummation of the transactions contemplated hereby for a period of one year
after the date hereof. Except as otherwise provided herein, all covenants and agreements contained
herein shall survive until, by their respective terms, they are no longer operative.
[Signature Pages Follow]
20
IN WITNESS WHEREOF
, the Company has caused this Securities Purchase Agreement
to be executed by its duly authorized representative as of the date first above written.
COMPANY:
CROSSFIRST BANKSHARES, INC.
By:
Name:
Title:
21
IN WITNESS WHEREOF
, the Purchaser has caused this Securities Purchase Agreement
to be executed by its duly authorized representative as of the date first above written.
PURCHASER
[IF AN ENTITY]
[INSERT PURCHASER’S NAME]
______________________________
By:
Name: _______________________
Title: ________________________
[IF AN INDIVIDUAL]
Name: _____________________________
Address of Purchaser:
______________________________
_________________________________
_________________________________
Aggregate Liquidation Amount of Purchased Series A
Preferred Stock:
$______________________
[CONTINUE TO NEXT PAGE]
22
PAYMENT INSTRUCTIONS FOR DIVIDENDS TO PURCHASER
Check One
[___] 1. Wire or Electronic Funds Transfer
1
Bank Name: _________________________________________
Bank Address: _______________________________________
___________________________________________________
ABA #: ____________________________________________
Account #: __________________________________________
Account Name: ______________________________________
Reference: __________________________________________
[___] 2. Check (to the following address)
__________________________________
__________________________________
_________________________________
Attention: _________________________
1
submit a written notice to the Company at least three Business Days prior to a dividend payment date either (i) via
electronic mail at legal@crossfirst.com, provided that the receiving party affirmatively acknowledges receipt (an
automated email confirmation of delivery or read receipt shall not constitute such acknowledgement of receipt); or
(ii) to CrossFirst Bankshares, Inc., Attn: General Counsel and Corporate Secretary, 11440 Tomahawk Creek
Parkway, Leawood, KS 66211.
23
EXHIBIT A
CERTIFICATE OF DESIGNATIONS
CERTIFICATE OF DESIGNATIONS
OF
SERIES A NON-CUMULATIVE PERPETUAL PREFERRED STOCK
OF
CROSSFIRST BANKSHARES, INC.
CrossFirst Bankshares, Inc., a Kansas corporation, referred to herein as the "corporation",
in accordance with the provisions of K.S.A. § 17-6401, does hereby certify:
The board of directors of the corporation, referred to herein as the "board of directors", in
accordance with Article III of the Articles of Incorporation of the corporation, as amended, and
applicable law, adopted the following resolution on March 22, 2023 creating a series of 15,000
shares of preferred stock of the corporation designated as "Series A Non-Cumulative Perpetual
Preferred Stock":
RESOLVED
, that pursuant to the authority conferred on the board of directors by
the corporation's Articles of Incorporation, as amended, the Series A Non-Cumulative
Perpetual Preferred Stock, as a series of preferred stock, par value $0.01 per share, of the
corporation, be and it hereby is created; and that the designations, powers, preferences and
rights of the Series A Non-Cumulative Perpetual Preferred Stock, and the qualifications,
limitations or restrictions thereof are as follows:
1. Designation and Number of Shares. There is hereby created out of the
authorized and unissued shares of preferred stock of the corporation authorized by Article
III(a) a series of preferred stock designated as the "Series A Non-Cumulative Perpetual
Preferred Stock" (the "Series A Preferred Stock"). The par value of the Series A Preferred
Stock shall be $0.01 per share. The authorized number of shares of Series A Preferred
Stock shall be 15,000. The number of shares constituting the Series A Preferred Stock may
be increased from time to time by resolution of the board of directors or a duly authorized
committee of the board of directors in accordance with the Articles of Incorporation, the
Bylaws, and applicable law up to the maximum number of shares of preferred stock
authorized to be issued under the Articles of Incorporation less all shares at the time
authorized of any other series of preferred stock or decreased from time to time by a
resolution of the board of directors or a duly authorized committee of the board of directors
in accordance with the Articles of Incorporation, the Bylaws, and applicable law but not
below the number of shares of Series A Preferred Stock then outstanding. Shares of Series
A Preferred Stock shall be dated the date of issue, which date shall be referred to herein as
the “original issue date.” Shares of outstanding Series A Preferred Stock that are redeemed,
purchased, or otherwise acquired by the corporation shall be cancelled and shall revert to
authorized but unissued shares of the preferred stock, undesignated as to series. The
corporation shall have the authority to issue fractional shares of Series A Preferred Stock.
2. Definitions. As used herein with respect to the Series A Preferred Stock:
24
“Appropriate Federal Banking Agency” means the “appropriate Federal banking
agency” with respect to the corporation as defined in Section 3(q) of the Federal Deposit
Insurance Act (12 U.S.C. Section 1813(q)), or any successor provision.
“Articles of Incorporation” means the Articles of Incorporation of the corporation,
as amended, and as it may be amended or restated from time to time.
“Business Day” means any day, other than a Saturday or Sunday, that is neither a
legal holiday nor a day on which banking institutions are authorized or required by law or
regulation to close in Kansas.
3. Ranking. The shares of Series A Preferred Stock shall rank:
(a) senior, as to dividends and upon liquidation, dissolution, and winding-up of
the corporation, to the common stock of the corporation and to any other class or series of
capital stock of the corporation now or hereafter authorized, issued, or outstanding that, by
its terms, does not expressly provide that such class or series ranks pari passu with the
Series A Preferred Stock or senior to the Series A Preferred Stock as to dividends and upon
liquidation, dissolution, and winding-up of the corporation, as the case may be
(collectively, “Series A Junior Securities”);
(b) on a parity, as to dividends and upon liquidation, dissolution, and winding-
up of the corporation, with any class or series of capital stock of the corporation now or
hereafter authorized, issued, or outstanding that, by its terms, expressly provides that such
class or series ranks pari passu with the Series A Preferred Stock as to dividends and upon
liquidation, dissolution, and winding-up of the corporation, as the case may be
(collectively, “Series A Parity Securities”); and
(c) junior, as to dividends and upon liquidation, dissolution, and winding-up of
the corporation, to any other class or series of capital stock of the corporation now or
hereafter authorized, issued, or outstanding that, by its terms, expressly provides that such
class or series ranks senior to the Series A Preferred Stock as to dividends and upon
liquidation, dissolution, and winding-up of the corporation, as the case may be.
The corporation may authorize and issue additional shares of Series A Preferred Stock, Series A
Junior Securities and Series A Parity Securities from time to time without the consent of the holders
of the Series A Preferred Stock.
4. Dividends.
(a) Holders of Series A Preferred Stock will be entitled to receive, only when,
as, and if declared by the board of directors or a duly authorized committee of the board of
directors, on each Dividend Payment Date (as defined below), out of assets legally
available for the payment of dividends thereof, non-cumulative cash dividends based on
the liquidation preference of the Series A Preferred Stock of $1,000 per share. Dividends
on each share of Series A Preferred Stock shall accrue at a rate equal to 8.00% per annum
on the liquidation preference of $1,000 per share for each Dividend Period. In the event
the corporation issues additional shares of the Series A Preferred Stock after the original
25
issue date, dividends on such shares may accrue from the original issue or any other date
specified by the board of directors or a duly authorized committee of the board of directors
at the time such additional shares are issued.
(b) If declared by the board of directors or a duly authorized committee of the
board of directors, dividends will be payable on the Series A Preferred Stock quarterly in
arrears on March 15, June 15, September 15, and December 15 of each year, beginning on
June 15, 2023 (each such day a “Dividend Payment Date”) based on a liquidation
preference of $1,000 per share. In the event that any Dividend Payment Date falls on a day
that is not a Business Day, the dividend payment due on that date shall be postponed to the
next day that is a Business Day and no additional dividends shall accrue as a result of that
postponement.
(c) Dividends will be payable to holders of record of Series A Preferred Stock
as they appear on the corporation’s stock register on the applicable record date, which shall
be the 15
th
date, not less than 15 calendar days nor more than 30 calendar days before the applicable
Dividend Payment Date, as such record date shall be fixed by the board of directors or a
duly authorized committee of the board of directors.
(d) A “Dividend Period” is the period from and including a Dividend Payment
Date to, but excluding, the next succeeding Dividend Payment Date or any earlier
redemption date, except that the initial Dividend Period will commence on and include the
original issue date of Series A Preferred Stock (or other date specified by the board of
directors or a duly authorized committee of the board of directors as provided in sub-
section (a)) and continue to, but excluding, the next Dividend Payment Date. Dividends
payable on Series A Preferred Stock will be computed on the basis of a 360-day year
consisting of twelve 30-day months. Dollar amounts resulting from the calculation will be
rounded to the nearest cent, with one-half cent being rounded upward. Dividends on the
Series A Preferred Stock will cease to accrue on the redemption date, if any, with respect
to the Series A Preferred Stock redeemed, unless the corporation defaults in the payment
of the redemption price of the Series A Preferred Stock called for redemption.
(e) Dividends on the Series A Preferred Stock will not be cumulative. If the
board of directors or a duly authorized committee of the board of directors does not declare
a dividend, in full or otherwise, on the Series A Preferred Stock in respect of a Dividend
Period, then such unpaid dividends shall cease to accrue and shall not be payable on the
applicable Dividend Payment Date or be cumulative, and the corporation will have no
obligation to pay (and the holders of the Series A Preferred Stock will have no right to
receive) dividends accrued for such Dividend Period after the Dividend Payment Date for
such Dividend Period, whether or not the board of directors or a duly authorized committee
of the board of directors declares a dividend for any future Dividend Period with respect to
the Series A Preferred Stock, the common stock, or any other class or series of the
corporation’s preferred stock. No interest, or sum of money in lieu of interest, shall be
payable in respect of any dividend not declared.
26
(f) Notwithstanding any other provision hereof, dividends on the Series A
Preferred Stock shall not be declared, paid, or set aside for payment to the extent such act
would cause the corporation to fail to comply with the laws and regulations applicable to
it, including applicable capital adequacy rules of the Board of Governors of the Federal
Reserve System (the “Federal Reserve”) or, as and if applicable, the capital adequacy rules
or regulations of any Appropriate Federal Banking Agency.
(g) So long as any share of Series A Preferred Stock remains outstanding:
(i) no dividend or distribution shall be declared, paid or set aside for
payment, and no distribution shall be declared or made or set aside for payment, on
any Series A Junior Securities, other than (A) a dividend payable solely in Series
A Junior Securities or (B) any dividend in connection with the implementation of a
stockholders’ rights plan, or the issuance of rights, stock, or other property under
any such plan, or the redemption or repurchase of any rights under any such plan;
(ii) no shares of Series A Junior Securities shall be repurchased,
redeemed, or otherwise acquired for consideration by the corporation, directly or
indirectly, other than (A) as a result of a reclassification of Series A Junior
Securities for or into other Series A Junior Securities, (B) the exchange or
conversion of one share of Series A Junior Securities for or into another share of
Series A Junior Securities, (C) through the use of the proceeds of a substantially
contemporaneous sale of other shares of Series A Junior Securities, (D) purchases,
redemptions, or other acquisitions of shares of Series A Junior Securities in
connection with any employment contract, benefit plan, or other similar
arrangement with or for the benefit of employees, officers, directors, or consultants,
(E) purchases of shares of Series A Junior Securities pursuant to a contractually
binding requirement to buy Series A Junior Securities existing prior to the
preceding Dividend Period, including under a contractually binding stock
repurchase plan, or (F) the purchase of fractional interests in shares of Series A
Junior Securities pursuant to the conversion or exchange provisions of such stock
or the security being converted or exchanged; nor shall any monies be paid to or
made available for a sinking fund for the redemption of any such securities by the
corporation; and
(iii) no shares of Series A Parity Securities shall be repurchased,
redeemed, or otherwise acquired for consideration by the corporation, directly or
indirectly, other than (A) pursuant to pro rata offers to purchase all, or a pro rata
portion, of the Series A Preferred Stock and such Series A Parity Securities, if any,
(B) as a result of a reclassification of Series A Parity Securities for or into other
Series A Parity Securities, (C) the exchange or conversion of one share of Series A
Parity Securities for or into another share of Series A Parity Securities or Series A
Junior Securities, (D) through the use of the proceeds of a substantially
contemporaneous sale of other shares of Series A Parity Securities, (E) purchases
of shares of Series A Parity Securities pursuant to a contractually binding
requirement to buy Series A Parity Securities existing prior to the preceding
Dividend Period, including under a contractually binding stock repurchase plan, or
27
(F) the purchase of fractional interests in shares of Series A Parity Securities
pursuant to the conversion or exchange provisions of such stock or the security
being converted or exchanged; nor shall any monies be paid to or made available
for a sinking fund for the redemption of any such securities by the corporation;
unless, in each case, the full dividends for the most recently completed Dividend Period on all
outstanding shares of Series A Preferred Stock have been declared and paid or declared and a sum
sufficient for the payment thereof has been set aside.
(h) Notwithstanding the foregoing, if dividends are not paid in full, or set aside for
payment in full, on any dividend payment date, upon the shares of Series A Preferred Stock and
any Series A Parity Securities, all dividends declared upon shares of Series A Preferred Stock and
any Series A Parity Securities for such dividend payment date shall be declared on a pro rata basis
in proportion to the respective amounts of undeclared and unpaid dividends for the Series A
Preferred Stock and all Series A Parity Securities on such dividend payment date. To the extent a
dividend period with respect to any Series A Parity Securities coincides with more than one
Dividend Period, for purposes of the immediately preceding sentence the board of directors shall
treat such dividend period as two or more consecutive dividend periods, none of which coincides
with more than one Dividend Period, or shall treat such dividend period(s) with respect to any
Series A Parity Securities and Dividend Period(s) for purposes of the immediately preceding
sentence in any other manner that it deems to be fair and equitable in order to achieve ratable
payments of dividends on such Series A Parity Securities and the Series A Preferred Stock. To the
extent a Dividend Period coincides with more than one dividend period with respect to any Series
A Parity Securities, for purposes of the first sentence of this paragraph the board of directors shall
treat such Dividend Period as two or more consecutive Dividend Periods, none of which coincides
with more than one dividend period with respect to such Series A Parity Securities, or shall treat
such Dividend Period(s) and dividend period(s) with respect to any Series A Parity Securities for
purposes of the first sentence of this paragraph in any other manner that it deems to be fair and
equitable in order to achieve ratable payments of dividends on the Series A Preferred Stock and
such Series A Parity Securities. For the purposes of this paragraph, the term “dividend period” as
used with respect to any Series A Parity Securities means such dividend periods as are provided
for in the terms of such Series A Parity Securities.
(i) Subject to the foregoing, dividends (payable in cash, stock, or otherwise), as may
be determined by the board of directors or a duly authorized committee of the board of directors,
may be declared and paid on the common stock and any other class or series of capital stock
ranking equally with or junior to Series A Preferred Stock from time to time out of any assets
legally available for such payment, and the holders of Series A Preferred Stock shall not be entitled
to participate in any such dividend.
5. Liquidation
(a) Upon any voluntary or involuntary liquidation, dissolution, or winding-up of the
corporation, holders of Series A Preferred Stock are entitled to receive out of the assets of the
corporation available for distribution to stockholders, after satisfaction of liabilities and obligations
to creditors, if any, and subject to the rights of holders of any securities then outstanding ranking
senior to or on parity with Series A Preferred Stock with respect to distributions of assets, before
28
any distribution or payment out of the assets of the corporation is made to holders of common
stock or any Series A Junior Securities, a liquidating distribution in the amount of the liquidation
preference of $1,000 per share plus any declared and unpaid dividends prior to the payment of the
liquidating distribution, without accumulation of any dividends that have not been declared prior
to the payment of the liquidating distribution. After payment of the full amount of such liquidating
distribution, the holders of Series A Preferred Stock shall not be entitled to any further participation
in any distribution of assets of the corporation.
(b) In any such liquidating distribution, if the assets of the corporation are not sufficient
to pay the liquidation preferences (as defined below) in full to all holders of Series A Preferred
Stock and all holders of any Series A Parity Securities, the amounts paid to the holders of Series
A Preferred Stock and to the holders of all Series A Parity Securities will be paid pro rata in
accordance with the respective aggregate liquidation preferences of those holders. In any such
distribution, the “liquidation preference” of any holder of Series A Preferred Stock or any Series
A Parity Securities means the amount otherwise payable to such holder in such distribution
(assuming no limitation on the corporation’s assets available for such distribution), including any
declared but unpaid dividends (and, in the case of any holder of stock other than the Series A
Preferred Stock on which dividends accrue on a cumulative basis, an amount equal to any unpaid,
accrued, cumulative dividends, whether or not declared, as applicable). If the liquidation
preference has been paid in full to all holders of Series A Preferred Stock and any Series A Parity
Securities, the holders of the corporation’s Series A Junior Securities shall be entitled to receive
all remaining assets of the corporation according to their respective rights and preferences.
(c) For purposes of this Section 5, neither the sale, conveyance, exchange, or transfer
of all or substantially all of the assets or business of the corporation for cash, securities, or other
property, nor the merger or consolidation of the corporation with any other entity, including a
merger or consolidation in which the holders of Series A Preferred Stock receive cash, securities,
or property for their shares, shall constitute a liquidation, dissolution, or winding-up of the
corporation.
6. Redemption.
(a) Series A Preferred Stock is not subject to any mandatory redemption, sinking fund,
or other similar provision. Series A Preferred Stock is not redeemable prior to March 29, 2028.
Shares of Series A Preferred Stock then outstanding will be redeemable at the option of the
corporation, in whole or in part, from time to time, on March 29, 2028, or on any Dividend
Payment Date on or after March 29, 2028, at a redemption price equal to $1,000 per share, plus
any declared and unpaid dividends, without accumulation of any undeclared dividends, to, but
excluding, the date of redemption. Holders of Series A Preferred Stock will have no right to require
the redemption or repurchase of Series A Preferred Stock. Notwithstanding the foregoing, within
90 days following the occurrence of a Regulatory Capital Treatment Event (as defined below), the
corporation, at its option, may redeem, at any time, all (but not less than all) of the shares of the
Series A Preferred Stock at the time outstanding, at a redemption price equal to $1,000 per share,
plus any declared and unpaid dividends, without accumulation of any undeclared dividends, upon
notice given as provided in sub-section (b) below. Any declared but unpaid dividends payable on
a redemption date that occurs subsequent to the record date for a Dividend Period shall not be paid
to the holder entitled to receive the redemption price on the redemption date, but rather shall be
29
paid to the holder of record of the redeemed shares on such record date relating to the Dividend
Payment Date as provided in Section 4(c) above. In all cases, the corporation may not redeem
shares of the Series A Preferred Stock without having received the prior approval of the Federal
Reserve or any successor Appropriate Federal Banking Agency if then required under capital rules
applicable to the corporation.
A “Regulatory Capital Treatment Event” means the good faith determination by the board
of directors or a duly authorized committee of the board of directors that, as a result of (i) any
amendment to, or change in, the laws, rules, or regulations of the United States or any political
subdivision of or in the United States (including, for the avoidance of doubt, any agency or
instrumentality of the United States, including the Federal Reserve and other federal banking
agencies) that is enacted or becomes effective after the initial issuance of any share of the Series
A Preferred Stock; (ii) any proposed change in those laws, rules, or regulations that is announced
after the initial issuance of any share of the Series A Preferred Stock; or (iii) any official
administrative decision or judicial decision or administrative action or other official
pronouncement interpreting or applying those laws, rules, or regulations or policies with respect
thereto that is announced after the initial issuance of any share of the Series A Preferred Stock,
there is more than an insubstantial risk that the corporation will not be entitled to treat the full
liquidation value of $1,000 per share of the Series A Preferred Stock then outstanding as “Tier 1
Capital” (or its equivalent) for purposes of the capital adequacy rules of the Federal Reserve (or,
as and if applicable, the capital adequacy rules or regulations of any successor Appropriate Federal
Banking Agency), as then in effect and applicable, for as long as any share of the Series A Preferred
Stock is outstanding.
(b) If shares of Series A Preferred Stock are to be redeemed, the notice of redemption
shall be given to the holders of record of Series A Preferred Stock to be redeemed by first class
mail, postage prepaid, addressed to the holders of record of such shares to be redeemed at their
respective last addresses appearing on the corporation’s stock register not less than 30 days nor
more than 60 days prior to the date fixed for redemption thereof. Each notice of redemption will
include a statement setting forth (i) the redemption date; (ii) the number of shares of Series A
Preferred Stock to be redeemed and, if less than all the shares held by such holder are to be
redeemed, the number of such shares to be redeemed from such holder; (iii) the redemption price;
and (iv) that dividends on the shares to be redeemed will cease to accrue on the redemption date.
If notice of redemption of any shares of Series A Preferred Stock has been duly given and if the
funds necessary for such redemption have been set aside by the corporation for the benefit of the
holders of any shares of Series A Preferred Stock so called for redemption, then, on and after the
redemption date, dividends will cease to accrue on such shares of Series A Preferred Stock; such
shares of Series A Preferred Stock shall no longer be deemed outstanding; and all rights of the
holders of such shares will terminate, except the right to receive the redemption price described in
sub-section (a) above, without interest.
(c) In case of any redemption of only part of the shares of Series A Preferred Stock at
the time outstanding, the shares to be redeemed shall be selected pro rata.
30
7. Voting Rights.
(a) Except as provided below and as determined by the board of directors or a duly
authorized committee of the board of directors or as expressly required by law, the holders of
shares of Series A Preferred Stock shall have no voting power, and no right to vote on any matter
at any time, either as a separate series or class or together with any other series or class of shares
of capital stock, and shall not be entitled to call a meeting of such holders for any purpose, nor
shall they be entitled to participate in any meeting of the holders of the common stock.
(b) So long as any shares of Series A Preferred Stock remain outstanding, the
affirmative vote or consent of the holders of at least two-thirds of all of the shares of Series A
Preferred Stock at the time outstanding, voting separately as a class, shall be required to: (i)
authorize, create, or issue, or increase the authorized amount of, shares of any class or series of
capital stock ranking senior to the Series A Preferred Stock with respect to payment of dividends
or the distribution of assets upon liquidation, dissolution, or winding up of the corporation, or issue
any obligation or security convertible into or exchangeable for, or evidencing the right to purchase,
any such class or series of the corporation’s capital stock; (ii) amend, alter, or repeal the provisions
of the Articles of Incorporation (including this Certificate of Designations), (including, unless no
vote on such merger or consolidation is required by Section 7(b)(iii)(B) below, any amendment,
alteration or repeal by means of a merger, consolidation, or otherwise), so as to adversely affect
the powers, preferences, privileges, or rights of Series A Preferred Stock, taken as a whole;
provided, however, that any amendment to authorize, create, or issue, or increase the authorized
amount of, Series A Preferred Stock, any Series A Junior Securities or any Series A Parity
Securities, or any securities convertible into or exchangeable for Series A Junior Securities or
Series A Parity Securities will not be deemed to adversely affect the powers, preferences,
privileges, or rights of Series A Preferred Stock; or (iii) complete a binding share exchange or
reclassification involving the Series A Preferred Stock, or complete the sale, conveyance,
exchange, or transfer of all or substantially all of the assets or business of the corporation or
consolidate with or merge into any other corporation, unless, in any case, the shares of Series A
Preferred Stock outstanding at the time of such consolidation or merger or sale either (A) remain
outstanding or (B) are converted into or exchanged for preference securities of the surviving entity
or any entity controlling the surviving entity having such rights, preferences, privileges, and
powers (including voting powers), taken as a whole, as are not materially less favorable to the
holders thereof than the rights, preferences, privileges, and powers (including voting powers) of
the Series A Preferred Stock, taken as a whole.
(c) The foregoing voting provisions will not apply if (i) at or prior to the time when the
act with respect to which such vote would otherwise be required shall be effected, all outstanding
shares of Series A Preferred Stock shall have been redeemed or called for redemption upon proper
notice and sufficient funds shall have been set aside by the corporation for the benefit of the holders
of Series A Preferred Stock to effect such redemption or (ii) such voting provisions are not
permitted under the corporate governance requirements of the Nasdaq Stock Market, LLC (or any
other exchange or automated quotation system on which the common stock of the corporation may
be listed or quoted).
(d) The rules and procedures for calling and conducting any meeting of the holders of
Series A Preferred Stock (including, without limitation, the fixing of a record date in connection
31
therewith), the solicitation and use of proxies at such a meeting, the obtaining of written consents,
and any other aspect or matter with regard to such meeting or such consents shall be governed by
any rules that the board of directors or any duly authorized committee of the board of directors, in
its discretion, may adopt from time to time, which rules and procedures shall conform to the
requirements of the Articles of Incorporation, the Bylaws, and applicable law.
8. No Conversion Rights. The holders of shares of Series A Preferred Stock
shall not have any rights to convert such shares into shares of any other class or series of
securities of the corporation.
9. No Preemptive Rights. The holders of shares of Series A Preferred Stock
will have no preemptive rights with respect to any shares of the corporation’s capital stock
or any of its other securities convertible into or carrying rights or options to purchase or
otherwise acquire any such capital stock or any interest therein, regardless of how any such
securities may be designated, issued, or granted.
10. No Certificates. The corporation may at its option issue shares of Series A
Preferred Stock without certificates.
11. Transfer Agent; Registrar. The corporation may appoint a transfer agent and
registrar for the Series A Preferred Stock.
12. Transfer; Restricted Legend. The shares of Series A Preferred Stock are
“restricted securities” under the Securities Act of 1933, as amended (the “Securities Act”)
and accordingly, may be resold, pledged or otherwise transferred only in compliance with
the registration requirements of federal and state securities laws or if exemptions from the
Securities Act and applicable state securities laws are available. The corporation may
include a notation of the restrictions on transfer in the records of the corporation or any
transfer agent or registrar with respect to any transfer of Series A Preferred Stock. Any
certificates or other instruments representing or notices of issuance relating to the shares
of Series A Preferred Stock will bear a restrictive legend in substantially the following
form:
THE SECURITIES REFERENCED HEREIN HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES
ACT”), OR THE SECURITIES LAWS OF ANY STATE, AND MAY NOT BE
OFFERED, TRANSFERRED, PLEDGED, HYPOTHECATED, SOLD OR
OTHERWISE DISPOSED OF UNLESS A REGISTRATION STATEMENT
UNDER THE SECURITIES ACT AND APPLICABLE STATE SECURITIES
LAWS SHALL HAVE BECOME EFFECTIVE WITH REGARD THERETO, OR
AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT
AND APPLICABLE STATE SECURITIES LAWS IS AVAILABLE IN
CONNECTION WITH SUCH OFFER OR SALE.
13. No Other Rights. The shares of Series A Preferred Stock shall not have any
rights, preferences, privileges, or voting powers or relative, participating, optional, or other
32
special rights, or qualifications, limitations, or restrictions thereof, other than as set forth
herein or in the Articles of Incorporation, or as provided by applicable law.
[Signature page follows]
IN WITNESS WHEREOF, CrossFirst Bankshares, Inc. has caused this Certificate of
Designations to be signed by a duly authorized officer, this ___ day of March, 2023.
CROSSFIRST BANKSHARES, INC.
By: