First United Corporation a bank holding company and the parent company of First United Bank & Trust (the “Bank”), today issued the below statement in response to Driver Management Company LLC’s (“Driver”) press release filed on May 26, 2020:
Driver has issued another misleading message to shareholders of First United. Yesterday, Driver inaccurately characterized its negotiated Settlement Agreement and Consent Order with the Maryland Commissioner of Financial Regulation (the “Maryland Commissioner”) as an exoneration, or proof that it did not violate Maryland law. The settlement Driver references is one in which the regulator simply agreed not to take enforcement action against Driver, as long as Driver, among other things, agreed to not violate Maryland law going forward.
Importantly, shareholders should be aware of the actual facts: on May 14, 2020, the Maryland Commissioner notified Driver that the Maryland Commissioner had concluded his investigation and that his staff found sufficient evidence to find that Driver violated Maryland’s stock acquisition statute, the remedy for which is a five-year prohibition on Driver voting its shares. This letter noted that a copy was being sent to First United so that First United could consider the impact of the Maryland Commissioner’s conclusion on the upcoming annual meeting of shareholders. This voting prohibition is required by statute if a violation of Maryland’s stock acquisition statute is found to exist.
Driver’s settlement agreement with the Maryland Commissioner does not resolve the issue of whether Driver’s violation of the stock acquisition statute prohibits it from voting its shares for a period of five years, including at the upcoming annual meeting. Nor does it resolve the issue of whether Driver’s nominations are valid under First United’s bylaws or Maryland law. We asked a Maryland State Court last week for declaratory relief to provide clarification on these two issues, after Driver threatened to sue us. We will continue to seek this determination in order to provide the clarity that is needed for our shareholders.
The Maryland Commissioner’s letter to Driver and their settlement are attached to this release.
YOUR VOTE IS IMPORTANT
VOTE FOR FIRST UNITED’S NOMINEES ON THE BLUE PROXY CARD TODAY
If you have already voted a WHITE proxy card, you may revoke that vote by voting the enclosed BLUE proxy card today.
If you have any questions or require any assistance with respect to voting your shares, please contact the Company’s proxy solicitor, Morrow Sodali LLC:
509 Madison Avenue, Suite 1206
New York, NY 10022
Toll Free: (800) 662-5200
E-mail: FirstUnitedCorp@MorrowSodali.com
Shareholder Contact
Morrow Sodali LLC
Mike Verrechia/Bill Dooley
(800) 662-5200
FirstUnitedCorp@MorrowSodali.com
Media Contact
Prosek Partners
Brian Schaffer / Josh Clarkson / Kristen Duarte
(646) 818-9229 / (646) 818-9259 / (646) 818-9074
bschaffer@prosek.com / jclarkson@prosek.com / kduarte@prosek.com
ABOUT FIRST UNITED CORPORATION
First United Corporation is the parent company of First United Bank & Trust, a Maryland trust company with commercial banking powers, and two statutory trusts that were used as financing vehicles. The Bank has four wholly-owned subsidiaries: OakFirst Loan Center, Inc., a West Virginia finance company; OakFirst Loan Center, LLC, a Maryland finance company; First OREO Trust, a Maryland statutory trust that holds and services real estate acquired by the Bank through foreclosure or by deed in lieu of foreclosure; and FUBT OREO I, LLC, a Maryland company that likewise holds and services real estate acquired by the Bank through foreclosure or by deed in lieu of foreclosure. The Bank also owns 99.9% of the limited partnership interests in Liberty Mews Limited Partnership; a Maryland limited partnership formed for the purpose of acquiring, developing and operating low-income housing units in Garrett County, Maryland. The Corporation’s website is www.mybank.com.