Item 1.01 Entry Into a Material Definitive Agreement.
Broadway Financial Corporation (the “Company”) entered into stock purchase agreements (the “Stock Purchase Agreements”) with Cedars-Sinai Medical Center (“Cedars-Sinai”),
Banc of America Strategic Investments Corporation, a wholly owned subsidiary of Bank of America Corporation (“BofA”) and Wells Fargo Central Pacific Holdings, Inc., a wholly owned subsidiary of Wells Fargo & Company (“Wells Fargo” and together
with Cedars-Sinai and BofA, the “Investors”) on November 23, 2020, November 23, 2020 and November 24, 2020, respectively, pursuant to which the Company has agreed to sell and such Investors have severally agreed to purchase shares of the Company’s
common stock in individual amounts that aggregate to up to 4,639,888 shares of Class A Common Stock of the Company, par value $0.01 per share (“Class A Common Stock”) and
1,587,162 shares of Class C Common Stock of the Company, par value $0.01 per share (“Class C Common Stock”, and together with the Class A Common Stock, the “Common Stock”), in
each case, structured as non-controlling equity investments and subject to adjustment in certain circumstances, at a price of $1.78 per share payable in cash at the closing of the sales of stock, for an aggregate purchase price of $11,084,149.
The Company’s existing classes of voting common stock and non-voting common stock will be renamed as Class A
Common Stock and Class C Common Stock, respectively, in connection with the consummation of the merger of CFBanc Corporation with and into the Company, in which the Company will be the surviving corporation, pursuant to the previously
reported Agreement and Plan of Merger, dated August 25, 2020, entered into between the Company and CFBanc Corporation (the “Merger”).
The consummation of each of the sales of shares of Common Stock to the Investors under the respective Stock Purchase Agreements is subject to the satisfaction of certain
closing conditions, including (i) the consummation of the Merger, which is subject to the satisfactions of various conditions including stockholder and regulatory approval, among others, (ii) receipt of any stockholder approvals required under
applicable law or the NASDAQ Listing Rules and (iii) certain other customary closing conditions. There can be no assurance that all of such conditions will be satisfied. The respective stock purchase obligations of the individual Investors are not
conditioned on the completion of sales of Common Stock to any other Investor.
The Stock Purchase Agreements contain customary representations and warranties of the Company and the Investors. The Stock Purchase Agreements also contain certain
indemnification obligations of each party with respect to breaches of representations, warranties and covenants and certain other specified matters.
The Company may enter into additional stock purchase agreements with other investors for the sale of up to a maximum of 12,720,000 shares of Common Stock, including the
6,227,050 shares covered by the Stock Purchase Agreements reported herein, for the same price per share and on similar terms as the Stock Purchase Agreements entered into with the Investors.
The above description of the Stock Purchase Agreements has been included to provide investors and security holders with information regarding the terms of the Stock
Purchase Agreements. It is not intended to provide any other factual information about the Company, the Investors or their respective subsidiaries and affiliates.