Community First Bancshares, Inc. (the “Company”) (Nasdaq:CFBI), the holding company for Newton Federal Bank (the “Bank”), announced today that its Board of Directors, together with the Board of Directors of Community First Bancshares, MHC (the “MHC”), has adopted a Plan of Conversion and Reorganization (the “Plan of Conversion”).
Pursuant to the Plan of Conversion, the Company will reorganize into a new fully public stock holding company structure and as part of the conversion will conduct a second-step stock offering of new shares of common stock.
As part of the conversion, the Bank, which will change its name to Affinity Bank, will become a wholly owned subsidiary of a new holding company, which will be named Affinity Bancshares, Inc. Shares of common stock of the Company held by persons other than the MHC will be converted into shares of common stock of the new holding company pursuant to an exchange ratio generally intended to preserve the percentage ownership interests of such persons. Shares of Company common stock owned by the MHC will be canceled and the amount of the MHC’s ownership interest in the Company will be sold through the second-step stock offering. In the stock offering, depositors of the Bank (including depositors of the former Affinity Bank) with qualifying deposits as of June 30, 2019, will have first priority to purchase the new shares of common stock.
The conversion and offering will have no impact on depositors, borrowers or other customers of the Bank. The transactions contemplated by the Plan of Conversion are subject to approval by the Company’s stockholders (including approval by a majority of the shares held by persons other than the MHC), the members of the MHC (depositors of the Bank) and the Board of Governors of the Federal Reserve System.
A prospectus or proxy statement/prospectus, as applicable, and other materials containing detailed information relating to the Plan of Conversion, details of the offering, and business and financial information about the Company will be sent to stockholders of the Company and depositors of the Bank following receipt of regulatory approval.
This release is neither an offer to sell nor a solicitation of an offer to buy common stock. The offer is made only by the prospectus when accompanied by a stock order form. The shares of common stock of the new holding company are not savings accounts or savings deposits, may lose value and are not insured by the Federal Deposit Insurance Corporation or any other government agency.
Performance Trust Company Partners, LLC will act as selling agent for the Company in the conversion. Luse Gorman, PC is serving as the Company’s legal counsel and Silver, Freedman, Taff & Tiernan LLP is acting as Performance Trust Company Partners, LLC’s legal counsel.