University Bancorp, Inc. has Issued $5.0 Million in 6% Convertible Preferred Stock Through a Private Placement Offering
THE TRANSACTION
On December 21, 2018, University Bancorp, Inc. (OTCQB: UNIB) (the "Company") announced that it has issued to a company controlled by Robert Kauffman, a co-founder of Fortress Investment Group, $5 million of a newly created series of 6% convertible preferred stock, to be designated as Series 5 Convertible Preferred Stock (the "Preferred Stock"). The shares of Preferred Stock were issued for $4.75 million, or 95% of face value, and are convertible into common stock at $10 per share.
Effective immediately, Mr. Kauffman has joined the Board of Directors of both University Bank and the Company.
Stephen Lange Ranzini, President and CEO, noted, "This additional capital investment will be invested in growing the Company's current business lines and related activities and will allow us to better take advantage of market opportunities."
The Preferred Stock was issued in a private placement exempt from registration pursuant to Rule 506 of Regulation D under the Securities Act of 1933, as amended (the "Securities Act") and does not trade in the OTC Market. The Preferred Stock have not been and will not be registered under the Securities Act or any state securities laws.
Our Client
UNIVERSITY BANCORP, INC.
Ann Arbor-based University Bancorp owns 100% of University Bank (the "Bank") which, together with its Michigan-based subsidiaries, holds and manages a total of over $21.6 billion in financial assets for over 125,000 customers, and has 394 employees which makes it the 5th largest bank based in Michigan. University Bank is an FDIC-insured, locally owned and managed community bank, and meets the financial needs of its community through its creative and innovative services. Founded in 1890, University Bank is the 15th oldest bank headquartered in Michigan. The Bank has previously been selected as the "Community Bankers of the Year" by American Banker magazine and as the recipient of the American Bankers Association's Community Bank Award. University Bank is a Member FDIC. The members of University Bank's corporate family, ranked by their size of revenues are:
• University Lending Group, a retail residential mortgage originator based in Clinton Township, MI;
• Midwest Loan Services, a residential mortgage subservicer based in Houghton, MI;
• UIF, a faith-based banking firm based in Southfield, MI;
• Community Banking, based in Ann Arbor, MI, which provides traditional community banking services in Ann Arbor;
• Midwest Loan Solutions, a residential mortgage correspondent lender based in Southfield, MI, also doing business as American Mortgage Solutions;
• Ann Arbor Insurance Centre, an independent insurance agency based in Ann Arbor.
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