Franklin Bank skips dividend on series A perpetual preferreds

By Lisa Kerner

Charlotte, N.C., Sept. 15 - Franklin Bank Corp. said it will not declare or pay the dividend on its series A non-cumulative perpetual preferred stock that was scheduled for Monday.

According to a Franklin Bank news release, the company has no obligation to declare dividends on the preferreds or to pay any interest or any sum in lieu of interest with respect to undeclared dividends.

Franklin said if it fails to pay dividends on the preferreds for six quarterly dividend periods - consecutive or not - the size of the company's board of directors will be increased by two. In addition, holders of the preferreds will have the right to vote to fill the two vacancies until Franklin pays dividends for four consecutive dividend periods.

Based in Houston, Franklin Bank is the holding company for savings bank Franklin Bank, S.B.B.

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