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Arlington Asset Investment Corp. (NYSE:AAIC) ("Arlington") announced today that its shareholders have voted to approve the proposed merger transaction with Ellington Financial Inc. (NYSE:EFC) ("Ellington Financial") at a special meeting of shareholders of Arlington held today.
Approximately 98.2% of the votes cast at the special meeting – which is approximately 62.8% of the issued and outstanding shares of Arlington Class A common stock (the "Arlington Common Stock") entitled to vote at the special meeting -- voted to approve the terms of the previously announced Agreement and Plan of Merger, dated as of May 29, 2023 (the "Merger Agreement"), by and among Ellington Financial, EF Merger Sub Inc., a wholly owned subsidiary of Ellington Financial ("Merger Sub"), Arlington and, solely for the limited purposes set forth therein, Ellington Financial Management LLC ("EFC Manager"), which, among other things, provides for the merger of Arlington with and into Merger Sub, with Merger Sub continuing as the surviving corporation and a subsidiary of Ellington Financial (the "Merger").
If the Merger is completed, and upon the satisfaction of the conditions set forth in the Merger Agreement, each issued and outstanding share of Arlington Common Stock will be converted into the right to receive: (i) from Ellington Financial, 0.3619 shares of Ellington Financial common stock and (ii) from EFC Manager, cash consideration of $0.09 per share. Ellington Financial will pay cash in lieu of any fractional shares of Ellington Financial common stock that would otherwise have been received as a result of the Merger.
In addition, as a result of the Merger, (i) each outstanding share of Arlington 7.00% Series B Cumulative Perpetual Redeemable Preferred Stock will be converted into the right to receive one share of newly-designated Ellington Financial 7.00% Series D Cumulative Perpetual Redeemable Preferred Stock and (ii) each outstanding share of Arlington 8.250% Series C Fixed-to-Floating Rate Cumulative Redeemable Preferred Stock will be converted into the right to receive one share of newly-designated Ellington Financial 8.250% Series E Fixed-to-Floating Rate Cumulative Redeemable Preferred Stock.
The Merger is expected to close on December 14, 2023, subject to the satisfaction of the remaining closing conditions set forth in the Merger Agreement and discussed in detail in the proxy statement/prospectus filed with the U.S. Securities and Exchange Commission on November 3, 2023.
