Item
3.03 Material
Modification to Rights of Security Holders.
On February, 3, 2022, Arbor Realty Trust, Inc.
(the Company) filed Articles Supplementary (the New Articles Supplementary) with the Maryland State Department
of Assessments and Taxation to designate an additional 3,565,000 shares of the Companys authorized but unissued preferred stock,
$0.01 par value per share, as shares of 6.25% Series F Fixed-to-Floating Rate Cumulative Redeemable Preferred Stock (the Series F
Preferred Stock), with the powers, designations, preferences and other rights as set forth in the Articles Supplementary filed with
the Maryland State Department of Assessments and Taxation on October 7, 2021 (the Articles Supplementary). The New Articles
Supplementary became effective upon filing on February 3, 2022.
Pursuant to the previously announced Underwriting
Agreement, dated January 31, 2022, among the Company, Arbor Realty Limited Partnership and Raymond James & Associates, Inc.,
as underwriter (the Underwriter), the Company issued and sold 3,100,000 shares of Series F Preferred Stock, at a public
offering price of $24.20 per share. In addition, the Company granted the Underwriter an option for 30 days to purchase up to an additional
465,000 shares of the Series F Preferred Stock, solely to cover over-allotments, if any. Such shares constitute an additional issuance
of shares of Series F Preferred Stock (the New Series F Preferred Stock), to the 8,050,500 shares of Series F
Preferred Stock previously issued on October 12, 2021 (the Outstanding Series F Preferred Stock). The New Series F
Preferred Stock is part of a single series with and has the same terms as the Outstanding Series F Preferred Stock.
The Articles Supplementary provide that the Company
will pay, when and if authorized by the Board of Directors of the Company, cumulative cash dividends (i) to, but excluding, October 30,
2026 at a fixed rate equal to 6.25% per annum of the $25.00 per share liquidation preference (equivalent to $1.5625 per annum per share)
and (ii) from and including October 30, 2026 at a floating rate equal to a benchmark rate (which is expected to be Three-Month
Term SOFR (as defined in the Articles Supplementary)) plus a spread of 5.442% per annum of the $25.00 per share liquidation preference
(the Floating Rate); provided, however, that in no event shall the Floating Rate be lower than 6.125% per annum. Dividends
on the shares of New Series F Preferred Stock are cumulative from and including January 30, 2022 (the most recent dividend payment
date to which dividends on the Outstanding Series F Preferred Stock have been paid in full) and will be payable quarterly in arrears,
on the 30th day of January, April, July and October of each year (provided that if any dividend payment date is not
a business day, then the dividend which would otherwise have been payable on that dividend payment date may be paid on the next succeeding
business day). The first dividend on the shares of New Series F Preferred Stock is scheduled to be payable on April 30, 2022
in the amount of $0.390625 per share.
The Series F Preferred Stock is not redeemable
by the Company prior to October 12, 2026 except under circumstances intended to preserve the Companys qualification as a real
estate investment trust (REIT) and except upon the occurrence of a Change of Control (as defined in the Articles Supplementary).
On and after August 12, 2026, the Company may, at its option, redeem the Series F Preferred Stock, in whole or in part, at any
time or from time to time, for cash at a redemption price equal to $25.00 per share, plus any accumulated and unpaid dividends to, but
not including, the date fixed for redemption.
In addition, upon the occurrence of a Change of
Control, the Company may, at its option, redeem the Series F Preferred Stock, in whole or in part on, or within 120 days after, the
first date on which such Change of Control occurred, for cash at a redemption price of $25.00 per share, plus any accumulated and unpaid
dividends to, but not including, the date fixed for redemption.
The Series F Preferred Stock has no stated
maturity, is not subject to any sinking fund or mandatory redemption and will remain outstanding indefinitely unless repurchased or redeemed
by the Company or converted into the Companys common stock in connection with a Change of Control by the holders of Series F
Preferred Stock. Upon the occurrence of a Change of Control, each holder of Series F Preferred Stock will have the right (unless
the Company has exercised its right to redeem the Series F Preferred Stock in whole or in part, as described above, prior to the
Change of Control Conversion Date (as defined in the Articles Supplementary)) to convert some or all of the Series F Preferred Stock
held by such holder on the Change of Control Conversion Date into a number of shares of the Companys common stock per share of Series F
Preferred Stock determined by a formula, in each case, on the terms and subject to the conditions described in the Articles Supplementary,
including provisions for the receipt, under specified circumstances, of alternative consideration.
There are restrictions on ownership of the Series F
Preferred Stock intended to preserve the Companys qualification as a REIT. Except under limited circumstances, holders of the Series F
Preferred Stock have no voting rights.
A copy of the Articles Supplementary, the New Articles
Supplementary and form of Series F Preferred Stock Certificate are filed as Exhibits 3.1, 3.2 and 4.1, respectively, to this report,
and the information in the Articles Supplementary and the New Articles Supplementary is incorporated into this Item 3.03 by reference.
The description of the terms of the Articles Supplementary and the New Articles Supplementary in this Item 3.03 is qualified in its entirety
by reference to Exhibit 3.1.