Attached files
| file | filename |
|---|---|
| 8-K - CAPITAL TRUST HOLDINGS INC. | v162638_8k.htm |
| EX-2.1 - CAPITAL TRUST HOLDINGS INC. | v162638_ex2-1.htm |
Exhibit
99.1
First
Mariner Bancorp reaches agreement to sell Mariner Finance
Proceeds
to increase capital ratios of First Mariner Bank subsidiary
Baltimore, MD (10/13/2009) – First
Mariner Bancorp (NASDAQ: FMAR) announced today that it has reached an
agreement to sell its consumer finance company subsidiary, Mariner Finance, LLC,
for a purchase price of approximately $10.5 million. The transaction is expected
to close by December 15, 2009.
First Mariner Bancorp entered into a
Contribution and Joint Venture Agreement with MF Holdco, LLC, a newly formed
Delaware limited liability company sponsored by Milestone Partners, a middle
market private equity firm. First Mariner will contribute all of its equity
interest in Mariner Finance to MF Raven Holdings, Inc., a newly formed Delaware
corporation in exchange for 5% of that corporation’s common stock, valued at
$675,000, and approximately $9.825 million in cash. Under terms of
the agreement, approximately $8.775 million will be paid to First Mariner at
closing, and an additional $1.05 million will be placed in an escrow account,
with one-half of the funds distributed to First Mariner after the final
determination of Mariner Finance’s closing net assets, and the remainder
distributed 18 months after the closing. The amounts distributed from
escrow may be reduced to satisfy indemnification claims against First Mariner
under the agreement.
The
proceeds of the sale will be used to increase the capital reserves of First
Mariner Bancorp’s wholly owned First Mariner Bank. The bank consented to an FDIC
order issued September 18, 2009 to achieve and maintain a Tier 1 Leverage
Capital ratio of at least 7.5% and a Total Risk-Based Capital ratio of at least
11% within the next nine months.
“The sale of Mariner Finance is a first
and major step in increasing First Mariner Bank’s capital as required to meet
the FDIC’s specified ratios. This transaction will bring our risk based capital
ratio close to 10% and we are currently executing other portions of our plans to
fulfill the remainder of our capital requirement,” said Edwin F.
Hale Sr., Chairman and CEO of First Mariner Bancorp. Hale said the Bank
continues to pursue plans to increase its capitalization through a combination
of capital raising efforts in public and private markets and balance sheet
management.
“The sale of Mariner Finance is one
part of our comprehensive strategy to narrow our focus on First Mariner Bank’s
enormous opportunities as Baltimore’s largest remaining independent bank,” Hale
continued. “We are evaluating how to maximize opportunities
within our delivery network, both brick-and-mortar, online and mobile and we are
focusing on the alignment of our product mix with the needs of the Baltimore
market, including increasing the volume of non-real-estate-secured commercial
lending.”
Mariner Finance, LLC will continue to
operate with no significant changes to its management, staff, products or
locations. Mariner Finance, LLC will continue to operate under its current name,
its headquarters will remain in Baltimore, and its customers and vendors should
not be affected as a result of the sale. Janney Montgomery Scott served as the
financial advisor for First Mariner Bancorp and Mariner Finance,
LLC.
The closing of the transaction is
subject to numerous conditions, including, without limitation, that the parties
obtain consents and approvals from Mariner Finance’s lenders and from certain
governmental agencies that license and supervise Mariner
Finance. Accordingly, there can be no assurance that the closing will
occur when expected, if at all.
First Mainer Bancorp believes that its
consolidated results for the fiscal quarter in which the transaction closes will
reflect a pretax loss of approximately $10 million relating to the sale of
Mariner Finance, LLC, as the Company has a higher recorded basis in Mariner
Finance than the purchase price. The sale of Mariner Finance will not, however,
result in any current gain or loss for federal income tax
purposes. The Company anticipates that any deferred income tax
benefit that results from the sale will be assigned a full valuation
allowance.
# #
#
This press release contains
forward-looking statements as defined by the Private Securities Litigation
Reform Act of 1995. Forward-looking statements do not represent
historical facts, but are statements about management’s beliefs, plans and
objectives about the future, as well as its assumptions and judgments concerning
such beliefs, plans and objectives. These statements are evidenced by
terms such as “anticipate”, “estimate”, “should”, “expect”, “believe”, “intend”
and similar expressions. Although these statements reflect
management’s good faith beliefs and projections, they are not guarantees of
future performance and they may not prove true. These projections
involve risk and uncertainties that could cause actual results to differ
materially from those addressed in the forward-looking
statements. For a discussion of these risks and uncertainties, see
the section of the periodic reports that First Mariner Bancorp files with the
Securities and Exchange Commission entitled “Risk Factors”.