Attached files
file | filename |
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8-K - UNION NATIONAL FINANCIAL CORP / PA | v195827_8-k.htm |
EX-2.1 - UNION NATIONAL FINANCIAL CORP / PA | v195827_ex2-1.htm |
EXHIBIT
99.1
DONEGAL
FINANCIAL SERVICES CORPORATION
AND
UNION
NATIONAL FINANCIAL CORPORATION
AMEND
PRICING TERMS OF MERGER AGREEMENT
Jeffrey
D. Miller, Senior Vice President &
Chief
Financial Officer
|
Mark
D. Gainer, Chairman, President
& Chief Executive Officer
|
Donegal
Financial Services Corporation
|
Union
National Financial Corporation
|
Phone: (717)
426-1931
|
Phone: (717)
519-8630
|
Fax: (717)
426-7009
|
Fax: (717)
735-7121
|
E-mail: jeffmiller@donegalgroup.com
|
E-mail: mgainer@uncb.com
|
For Immediate
Release
MARIETTA
and LANCASTER, Pennsylvania, September 1, 2010 (GLOBENEWSWIRE) – Donald H.
Nikolaus, President of Donegal Financial Services Corporation ("DFSC"), and Mark
D. Gainer, Chairman, President and Chief Executive Officer of Union National
Financial Corporation ("UNNF") (OTC Bulletin Board: "UNNF.OB"), today jointly
announced the execution of an amendment to the Agreement and Plan of Merger
dated April 19, 2010, as amended and restated May 20, 2010, pursuant to which
UNNF and DFSC would merge. The amendment increases the cash portion
of the merger consideration payable to UNNF’s shareholders upon the completion
of the merger. UNNF and DFSC did not amend the merger agreement in any other
respect.
As a
result of the amendment, upon the completion of the merger, each share of UNNF
common stock will become the right to receive 0.2134 share of Class A common
stock of Donegal Group Inc. ("DGI") (NASDAQ Global Select: "DGICA") and that
amount of cash as equals $8.25 less the value of 0.2134 share of DGI Class A
common stock, based on the average closing price of DGI Class A common stock for
the five trading days immediately preceding the effective date of the merger,
but in no event less than $5.05 per share in cash nor more than $5.90 per share
in cash. In practical terms, UNNF shareholders will receive merger
consideration with a value of approximately $8.25 per share of UNNF common stock
provided DGI Class A common stock has an average closing price between $11.00
and $15.00 per share for the five trading days preceding the effective date of
the merger. The merger consideration set forth in the amended merger
agreement represents the maximum amount of merger consideration DFSC is willing
to provide to UNNF's shareholders.
The
amendment to the merger agreement addresses the fact that the closing price of
DGI Class A common stock has declined from $14.68 per share on April 19, 2010 to
$10.82 per share on August 30, 2010. By providing for an increase in
the cash portion of the merger consideration that UNNF's shareholders will
receive upon the completion of the merger, the parties believe UNNF shareholders
will receive value for their UNNF shares that better reflects the value the
parties anticipated when they originally signed the merger
agreement.
On
September 2, 2010, UNNF will mail a supplement to the proxy statement/prospectus
dated July 29, 2010 to its shareholders of record as of July 29, 2010, who are
the shareholders entitled to vote at UNNF’s special meeting of shareholders on
September 16, 2010. UNNF will also deliver another proxy card to each
shareholder of record. If a UNNF shareholder already returned a proxy
card and does not want to change the way he or she previously voted, such
shareholder need not return a new proxy or take any other action.
DGI is an
insurance holding company whose insurance subsidiaries, along with Donegal
Mutual Insurance Company, are members of the Donegal Insurance Group, which
conducts a property and casualty insurance business in 20 Mid-Atlantic, Southern
and Midwestern States. The Donegal Insurance Group has an A.M. Best
rating of A (Excellent).
Province
Bank, which DFSC owns, has three offices in Lancaster County and had
approximately $103.3 million in assets at June 30, 2010. Donegal
Mutual and DGI founded DFSC and Province Bank in 2000 to provide more
diversified financial services.
UNNF is a
bank holding company whose principal subsidiary is Union National Community
Bank. UNNF had approximately $501.9 million in assets and
stockholders' equity of approximately $30.5 million as of June 30,
2010. Union National Community Bank is a full service national bank
that provides a wide range of services to individuals and small to medium-sized
businesses in South Central Pennsylvania.
DGI and
UNNF have filed a proxy statement/prospectus, a supplement to the proxy
statement/prospectus and other relevant documents with the SEC in connection
with the merger. SHAREHOLDERS OF UNNF ARE ADVISED TO READ THE PROXY
STATEMENT/PROSPECTUS, THE SUPPLEMENT TO THE PROXY STATEMENT/PROSPECTUS AND ANY
OTHER RELEVANT DOCUMENTS DGI OR UNNF FILE WITH THE SEC, AS WELL AS ANY
AMENDMENTS OR SUPPLEMENTS TO THOSE DOCUMENTS, BECAUSE THEY WILL CONTAIN
IMPORTANT INFORMATION.
The proxy
statement/prospectus, the supplement to the proxy statement/prospectus, other
relevant materials and any other documents DGI and UNNF filed with the SEC, may
be obtained free of charge at the SEC's web site at www.sec.gov. In
addition, investors and security holders may obtain free copies of the documents
filed with the SEC by DGI by contacting Jeffrey D. Miller, Senior Vice President
& Chief Financial Officer, Donegal Group Inc., 1195 River Road, Marietta,
Pennsylvania, 17547, telephone: (717) 426-1931, and by UNNF by contacting Mark
D. Gainer, President and Chief Executive Officer, Union National Financial
Corporation, 570 Lausch Lane, Suite 300, Lancaster, Pennsylvania 17601,
telephone: (717) 519-8630.
-2-
UNNF and
its directors and executive officers may be deemed to be participants in the
solicitation of proxies from its shareholders in connection with the proposed
merger. Information concerning such participants' ownership of UNNF
stock is set forth in the proxy statement/prospectus. This
communication does not constitute an offer of any securities for
sale.
We
base all statements contained in this release that are not historic facts on our
current expectations. These statements are forward-looking in nature
(as defined in the Private Securities Litigation Reform Act of 1995) and involve
a number of risks and uncertainties. Actual results could vary
materially. Among the factors that could cause actual results to vary
materially include: our ability to maintain profitable operations,
the adequacy of our subsidiaries reserves for losses and loss adjustment
expenses, business and economic conditions in the areas in which we operate,
competition from various insurance and non-insurance businesses, terrorism, the
availability and cost of reinsurance, legal and judicial developments, changes
in regulatory requirements and other risks we describe from time to time in the
periodic reports we file with the Securities and Exchange
Commission. You should not place undue reliance on any such
forward-looking statements. We disclaim any obligation to update such
statements or to announce publicly the results of any revisions that we may make
to any forward-looking statements to reflect the occurrence of anticipated or
unanticipated events or circumstances after the date of such
statements.
-3-