Pelican Financial, Inc. Reaches an Agreement in Principle to Merge With Stark Bank Group, Ltd. Pending Regulatory and Shareholde
04 November 2005 - 3:03PM
PR Newswire (US)
ANN ARBOR, Mich., NAPLES, Fla., and FORT DODGE, Iowa, Nov. 4
/PRNewswire-FirstCall/ -- Pelican Financial, Inc. (AMEX:PFI), the
holding company for Pelican National Bank, has reached an agreement
in principle to merge with a newly formed subsidiary of Stark Bank
Group, Ltd., of Fort Dodge, Iowa, Charles C. Huffman, Pelican's
Chairman and CEO, and Thomas G. Schnurr, CEO, Stark Bank Group,
Ltd., jointly announced today. Pelican National Bank, headquartered
in Naples, Fla., is a full-service community bank serving the
consumer and commercial sectors from locations in Naples, Bonita
Springs, Cape Coral, Fort Myers, San Carlos and Sarasota, Florida.
At midyear 2005, the Bank reported assets of $204 million. Stark
Bank Group Ltd., headquartered in Fort Dodge, Iowa, is the holding
company for First American Bank, which operates 16 branch offices
and reported assets in excess of $1 billion. First American Bank is
also a full-service community bank, specializing in commercial and
small business lending and treasury management. According to the
terms of the proposed agreement, shareholders of Pelican Financial,
Inc. will receive $6.00 for each common share held, subject to
adjustment as to the extent that certain costs incurred by PFI
exceed $3.0 million and subject to an escrow account (expected to
be approximately $0.20 per share) to be established to cover these
costs, to the extent they may exceed $3.0 million, and to cover
possible liabilities from the expected sale of certain marine
loans. This escrow will reduce the immediate cash payment to less
than $6.00 per share. PFI has approximately 4.5 million common
shares outstanding. The proposed all-cash deal is subject to
approval by PFI shareholders and regulators, to a final due
diligence by the Stark Bank Group by November 14, 2005, at which
time the company expects to enter into a definitive agreement, and
to other customary closing conditions. The merger is expected to be
completed in the first quarter of 2006. The proposed agreement also
requires Stark Bank Group to purchase $4 million of a newly created
series of convertible preferred stock of PFI. Mr. Huffman said,
"This is a positive step for Pelican National Bank, its employees
and customers. The Stark Bank Group brings substantial financial
resources and respected banking experience to Pelican National
Bank. In effect, the merger will provide PNB with additional
resources to grow and compete." Mr. Schnurr added, "We are
delighted to increase our presence in the Southwest Florida
markets. Our goal is to re-energize Pelican National Bank as a
market leader and the best-in-class provider of financial products
and services. PNB has an excellent staff, great products and good
market position. We want to build upon these strengths. We expect
to continue with most of the programs and services that PNB
currently offers and augment these with the additional products and
services from First American Bank." Additional Information about
the Merger and Where to Find It It is anticipated that the merger
will be submitted to PFI shareholders for approval. PFI will
prepare proxy materials describing the merger that will be mailed
to PFI's shareholders. These proxy materials and other relevant
materials, including the definitive merger agreement, may be
obtained free of charge at the Securities and Exchange Commission's
website at http://www.sec.gov/ . In addition, shareholders may
obtain free copies of the documents that PFI files with the SEC on
PFI's website at http://www.pelicanfinancialinc.com/ or by written
request directed to: Howard Nathan Pelican Financial Inc. 3767
Ranchero Drive Ann Arbor, Michigan 48108. SHAREHOLDERS OF PFI ARE
URGED TO READ THESE MATERIALS AND TO READ THE DEFINITIVE PROXY
MATERIALS WHEN THEY BECOME AVAILABLE BECAUSE THEY CONTAIN AND WILL
CONTAIN IMPORTANT INFORMATION ABOUT THE PROPOSED MERGER AND RELATED
ITEMS. Shareholders are urged to read the proxy statement and other
relevant materials before making any voting or investment decisions
with respect to the proposed merger. The executive officers and
directors of PFI have interests in the proposed merger, some of
which differ from, and are in addition to, those of PFI's
shareholders generally. In addition, PFI and its executive officers
and directors may be participating or may be deemed to be
participating in the solicitation of proxies from the security
holders of PFI in connection with the proposed merger. Information
about the executive officers and directors of PFI, their
relationship with PFI and their beneficial ownership of PFI
securities will be set forth in the proxy materials filed with the
Securities and Exchange Commission. Shareholders may obtain
additional information regarding the direct and indirect interests
of PFI and its executive officers and directors in the proposed
merger by reading the proxy materials relating to the merger when
they become available. Forward-Looking Statements Safe Harbor This
news release contains comments or information that constitute
forward-looking statements within the context of the safe-harbor
provisions of the Private Securities Litigation Reform Act of 1995.
These forward-looking statements involve significant risks and
uncertainties. Actual results may differ materially from the
results discussed in the forward-looking statements. Factors that
may cause such a difference include: risks that the proposed merger
agreement will not be signed or that the merger will not be
consummated on the terms disclosed or at all; risks resulting from
the potential adverse effect on PFI's business and operations of
the covenants PFI made in the merger agreement; risks resulting
from the decrease in the amount of time and attention that
management can devote to PFI's business while also devoting its
attention to completing the proposed merger; risks associated with
the increases in operating costs resulting from the additional
expenses PFI has incurred and will continue to incur relating to
the proposed merger; changes in interest rates and interest-rate
relationships; demand for products and services; the degree of
competition by traditional and non-traditional competitors; changes
in banking regulations; changes in tax laws; changes in prices,
levies, and assessments; the impact of technological advances;
governmental and regulatory policy changes; the outcomes of
contingencies; trends in customer behavior and their ability to
repay loans; changes in the national and local economy; and other
factors included in PFI's filings with the Securities and Exchange
Commission, available free online via EDGAR at sec.gov. PFI assumes
no responsibility to update forward-looking statements. DATASOURCE:
Pelican Financial, Inc. CONTACT: Howard Nathan of Pelican
Financial, Inc., +1-800-765-5562; Ken Aschom of Stark Bank Group,
Ltd., +1-239-596-4111; or Mike Marcotte of Marcotte Financial
Relations, +1-248-656-3873, for Pelican Financial, Inc. Web site:
http://www.pelicanfinancialinc.com/
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