Facing opposition from some shareholders over the proposed deal, Atlantic Coast Financial Corp. on Tuesday announced an amendment to its merger agreement with Bond Street Holdings Inc. that could give shareholders more cash.
Under the original agreement announced in February, stockholders would receive up to $5 per share in cash in the deal, but they would only receive $3 when the merger is completed.
The other $2 would be put into an escrow account to cover possible stockholder claims against the company.
The amended agreement removes that contingency. Jacksonville-based Atlantic Coast Financial said Tuesday that stockholders will now receive the full $5 per share upon completion of the deal.
"This amended merger agreement provides our stockholders with cash payment in full at the time the transaction closes, eliminating any and all uncertainty about the value stockholders will receive and the timing of that payment," Atlantic Coast Financial CEO G. Thomas Frankland said in a news release.
"It simplifies the transaction's structure for stockholders and at the same time addresses the concerns about the transaction raised by certain dissenting stockholders," he said.
Two members of the board of directors controlling 6.6 percent of the stock and The Albury Investment Partnership, an Australian firm that controls 10 percent, have said they would vote against the previous merger agreement.
If the merger is approved by stockholders, Atlantic Coast Bank will be merged into Bond Street's Fort Lauderdale-based subsidiary, Florida Community Bank.
"The transaction, in our view, is win-win for all parties — the stockholders of Atlantic Coast Financial Corporation, the banking organizations of both Atlantic Coast Bank and Florida Community Bank, and the customers and communities we serve. We look forward to the transaction's successful completion," Florida Community Bank CEO Kent Ellert said in Tuesday's news release.
Atlantic Coast Financial said it expects to close the deal by the end of the second quarter, but it has not yet scheduled the shareholders' meeting to vote on the agreement.
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