AmeriServ Financial (ASRV) Announces Cooperation and Settlement Agreement with Driver Management
Key Summary: In January 2023, Driver Management nominated directors and faced legal disputes with AmeriServ. By May 2023, shareholders elected the company's candidates. In September 2023, Driver Management requested a special litigation committee and sought information on company bylaws. In December 2023, they raised concerns about insufficient legal proceedings disclosure. By January 2024, they highlighted their dispute with AmeriServ and called for a shareholder inquiry. On April 12, 2024, Driver Management filed a complaint against AmeriServ in the U.S. District Court for the Western District of Pennsylvania. On April 18, 2024, AmeriServ entered a Cooperation Agreement with SB Value Partners. On June 14, 2024, AmeriServ reached a settlement with Driver Management, leading to Driver withdrawing director nominations and shareholder proposals for the 2024 Annual Meeting.Market Cap: $42 million | AmeriServ Financial, Inc. operates as the bank holding company for AmeriServ Financial Bank that provides various consumer, mortgage, and commercial financial products.
On January 17, 2023, Driver Management (8.6%) delivered a letter to the company nominating a slate of director candidates: J. Abbott R. Cooper, Julius D. Rudolph, and Mr. Simmons, for election to the Board at the 2023 AGM. Source
On January 20, 2023, Driver Management delivered a letter to the CEO of the company stating that it is exercising its right to inspect certain books and records and demands to inspect certain documents.
On March 15, 2023, the company disclosed that Driver management's notice of director candidate nominations is invalid. Source
On March 16, 2023, Driver Management sent a letter to the counsel of the company regarding the unlawful attempt by the company to prevent Driver's nominees from serving as candidates for election to the board.
On March 17, 2023, the Company filed a complaint against Driver Management and the Driver Nominees in the Court seeking declaratory judgment that (i) the Company properly rejected Driver Opportunity’s notice of intent to nominate director candidates at the annual meeting, which was submitted on January 17, 2023, and (ii) because of such rejection, Driver has no right to nominate candidates for election to the Board and the defendants have no right to seek election to the board at the annual meeting. Driver reiterates its belief that there is no justification for the conclusions reached by the Company and is committed to defending itself against what it views as, an attempt to prevent it from exercising its rights as a shareholder. Source
On March 29, 2023, Driver Management filed a complaint in the Court against the Company and the Company’s board of directors. Source
On May 31, 2023, the company announced that shareholders voted to elect the company’s three director candidates. Source
On September 7, 2023, Driver Management delivered a letter to the Chairman of the board stating that it intends to nominate J. Abbott R. Cooper for election to the board at the company's 2024 AGM.
On September 12, 2023, Driver Management delivered a letter to the Company’s counsel regarding a demand made on August 1, 2023, for the company to appoint a special litigation committee (SLC) to investigate alleged breaches of fiduciary duties by current and former members of the board. The demand relates to ongoing litigation preventing shareholders from voting for certain director candidates. Driver Management seeks confirmation of the SLC's appointment, the estimated investigation completion date, and expresses concern about ongoing corporate waste.
On September 19, 2023, Driver Management sent a letter to the Chairman of the Board, seeking confirmation that its request to inspect specific company records has been denied, as indicated in a previous Rejection Letter from the company.
On September 25, 2023, Driver Management sent a letter to the Chairman of the Board, expressing frustration with the lack of response to its requests for information regarding company bylaws and director nominations. It highlights the importance of this information for its upcoming director nominations and question the Board's transparency and accountability in light of ongoing legal costs and underperformance.
On December 12, 2023, Driver Management sent a letter to the Chairman of the Board highlighting concerns about insufficient disclosure of material legal proceedings in the company's recent Form 10-Q filings.
On January 23, 2024, Jack Babich, former SVP & Chief HR Officer of AmeriServ Financial, contacted Abbott Cooper via LinkedIn. Babich disclosed concerns about his forced retirement due to his objection to how the company handled illegal misconduct by another senior officer. Driver Management Company LLC, represented by Cooper, demanded access to AmeriServ's records to verify Babich's claims but faced refusal and litigation from AmeriServ. In response, AmeriServ filed a complaint against Babich, alleging a violation of confidentiality provisions in his retirement agreement. On January 26, 2024, AmeriServ filed a claim against Cooper for "tortious interference." Driver views AmeriServ's actions as an attempt to distract shareholders and questions the company's financial decisions and motives behind its legal actions. They urge shareholders to seek answers from AmeriServ's board regarding these matters. Source
On February 1, 2024, Driver Management sent a letter to the shareholders criticizing the board's priorities and performance. They've nominated three directors for the 2024 annual meeting and proposed changes to improve corporate governance. AmeriServ's financial losses, litigation expenses, and focus on legal matters raise concerns about its board's effectiveness, according to Driver Opportunity Partners.
On April 12, 2024, Driver Management filed a complaint in the United States District Court for the Western District of Pennsylvania against the Company and the Company’s board of directors. The complaint details breaches of both Pennsylvania state law and federal securities laws, emphasizing the company's alleged efforts to stifle shareholder participation and maintain control.
On April 18, 2024, the company entered into a Cooperation Agreement with SB Value Partners (7.7%) and pursuant to it, SB Value Partners agreed to vote in line with the Board's recommendations on all matters except those involving an Extraordinary Transaction.
On June 14, 2024, the company has reached a cooperation and settlement agreement with Driver Management and pursuant to it, Driver has agreed to withdraw its notice of nomination of director candidates for election to the Company’s Board of Directors (the “Board”), along with other shareholder proposals, at the 2024 Annual Meeting of Shareholders and to voluntarily dismiss all outstanding litigation against AmeriServ.