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First United Issues Statement Regarding Recent Settlement Negotiations with Driver Management Company
Driver Refuses to Accept Reasonable Settlement Proposal OAKLAND, Md., March 26, 2020 /PRNewswire/ -- First United Corporation (NASDAQ: FUNC), a bank holding
About this update from First
[{"type":"text","content":"Driver Refuses to Accept Reasonable Settlement Proposal\n\n\nOAKLAND, Md., March 26, 2020 /PRNewswire/ -- First United Corporation (NASDAQ: FUNC), a bank holding company and the parent company of First United Bank & Trust (the \"Company\" or \"First United\"), today announced the conclusion of recent settlement talks with Driver Management Company LLC (\"Driver\"). \nFirst United has always respected the trusted nature of its conversations with shareholders. However, given Driver's deliberate efforts on multiple occasions to grossly mischaracterize its engagement with the board of directors (the \"Board\"), the Company wants to make clear to all stakeholders the terms of the most recent settlement offer turned down by Driver, which we believe are both reasonable and fair. We also want to make clear that we made the last true effort to avoid a costly and distracting proxy fight. Our recent settlement terms included:\nappointing two independent directors before the 2020 annual meeting of shareholders: the first selected by Driver from among independent director candidates identified by the Company who have no prior or current affiliation with First United; and one selected by the Company from among the nominees nominated by Driver.appointing a third independent director before the 2021 annual meeting of shareholders; the retirement of three incumbent directors from the Board — two before the 2020 annual meeting of shareholders and one before the 2021 annual meeting of shareholders; committee designations for each of the new directors designated by Driver; adopting more formal policies around the roles and responsibilities of the Lead Independent Director; and expense reimbursement to Driver of $350,000.This settlement construct would have given Driver direct input with respect to designating over 25% of the Board even though it owns less than 6% of the Company. In return, we requested customary non-disparagement, standstill (Driver voluntarily offered two years), and voting commitments, lasting this and next proxy season, even though the directors designated by Driver would be guaranteed to serve at least three years on the Board. Driver did not just reject the Board's settlement proposal — it again demanded a sale of First United, reiterating that Driver will run a proxy fight every year for the next three proxy seasons until it ...