JONESBORO, Ga.--(BUSINESS WIRE)--CCF Holding Company (OTC Pink:CCFH) (the “Company”), the holding company for Heritage Bank, today announced that the Company has entered into a securities purchase agreement (the “Agreement”) with Kenneth R. Lehman, a private investor.
Pursuant to the Agreement, Mr. Lehman has agreed to purchase from the Company up to approximately 11.4 million shares of common stock at a price of $1.40 per share, for an aggregate purchase price of up to $16.0 million, with a minimum purchase of 7.5 million shares of the Company’s common stock for a minimum aggregate purchase price of $10.5 million (the “Investment Transaction”).
The Agreement contemplates that all holders of warrants to purchase shares of the Company’s common stock will have the opportunity to tender all or any portion of their warrants to the Company and receive a cash payment of $0.90 per warrant, subject to proration in certain circumstances. In addition, holders of the Company’s Series A Preferred Stock, who are accredited investors, will have the opportunity to tender all or any portion of their shares of Series A Preferred Stock in exchange for 714 newly issued shares of the Company’s common stock for each share of Series A Preferred Stock tendered, subject to proration in certain circumstances. The shares of common stock received in exchange for Series A Preferred Stock will be subject to certain voting and transfer restrictions. This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities. The Company will deliver materials to each warrantholder and preferredholder containing the Company’s offer to purchase outstanding warrants and offer to exchange Series A Preferred Stock, as well as instructions on how such holders can participate in each offer.
Any shares of Series A Preferred Stock that are not exchanged for shares of the Company’s common stock will be redeemed by the Company for a cash payment of $1,000 per share in accordance with the terms of the Series A Preferred Stock.
At December 31, 2016, the Company had 5,190,223 shares of common stock outstanding, and 39,590,223 shares of common stock outstanding on a fully diluted basis (assuming the conversion of outstanding preferred shares and the exercise of outstanding warrants). The Company’s fully diluted book value at December 31, 2016 was $1.05 per share. Through these transactions, the Company anticipates the resulting fully diluted book value to be approximately $1.40 per share and accretive to existing shareholders.
“We are humbled by Ken’s confidence in our company and his investment is a testimony to the hard work and perseverance of the entire Heritage Bank team. Ken’s investment provides us with the opportunity to create a strong common equity capital base, as well as position us for future growth,” said Leonard A. Moreland, Chief Executive Officer and President of CCF Holding Company.
Subject to the receipt of regulatory approvals and satisfaction of other closing conditions, the Investment Transaction is anticipated to close in the third quarter of 2017. The offer to purchase outstanding warrants and offer to exchange Series A Preferred Stock, as well as the proposed redemption of any shares of Series A Preferred Stock not tendered for exchange, are conditioned on the closing of the Investment Transaction.
About CCF Holding Company
With $431 million in total assets as of March 31, 2017, CCF Holding Company, through its wholly-owned subsidiary, Heritage Bank, offers a broad range of financial services through its six branches in Clayton, Henry, and Fayette counties in Georgia.
The Company’s common stock trades on the OTC Bulletin Board under the symbol “CCFH.”
Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking statements, which can be identified by words such as “will,” “plan,” “expect,” “likely” “project,” “may,” and similar references to future periods. Examples of forward-looking statements include, among others, statements regarding the Company’s planned Investment Transaction, including the expected timing of the closing of the transaction, the expected impact of the Investment Transaction on fully diluted book value per share, and that the Investment Transaction will position the Company for future growth. Forward-looking statements are only predictions and involve known and unknown risks, uncertainties and other factors, and, therefore, actual results and outcomes may materially differ from what may be expressed or forecasted in such forward-looking statements. The Company does not assumes any duty to update, amend or clarify forward-looking statements, whether as a result of new information, future events or otherwise. Risk factors relating to the Investment Transaction, the Company’s ability to make the offers related to the warrants and Series A Preferred Stock and the impact of the Investment Transaction include, without limitation, that the completion of the Investment Transaction is dependent on, among other things, receipt of regulatory approvals, the timing of which cannot be predicted with precision at this point and which may not be received at all, and other closing conditions, the number of warrantholders who tender their warrants for purchase, the number of preferredholders who tender their shares of preferred stock for exchange, a downturn in the economy, particularly in the Company’s markets, volatile credit and financial markets both domestic and foreign, potential deterioration in real estate values, regulatory changes and excessive loan losses.