Yadkin Valley Bank founder resigns from board ahead of proposed merger

By Lisa Kerner

Charlotte, N.C., April 9 - Daniel J. Park resigned as a director of Yadkin Valley Financial Corp. and Yadkin Valley Bank and Trust Co., according to a form 8-K filed with the Securities and Exchange Commission.

He founded Yadkin Valley Bank and has been a director for more than 40 years.

At the time of his resignation, Park was the chairperson of Yadkin Valley Financial's nominating and compensation committee and a member of the executive committee.

Park said he resigned in part because he disagrees with how Yadkin Valley is pursuing shareholder approval of the proposed merger with American Community Bancshares, Inc.

In an April 6 letter to the company, Park also disagreed with Yadkin Valley's decision to pursue growth opportunities.

According to Park, Yadkin Valley is only giving its shareholders two weeks "to review and digest" supplemental proxy materials.

The Yadkin Valley board of directors rejected Park's motion to adjourn the April 16 special meeting of shareholders to April 30, Park said.

Park said Yadkin Valley's management plans to use proxies already delivered by shareholders who voted before they knew that only nine of 14 directors of the company currently support the proposed merger with American Bancshares and that both companies' operating losses for the quarter ended Dec. 31 exceed earlier estimates.

As previously reported, shareholders of Yadkin Valley and American Community will reconvene their respective special meetings of shareholders on April 16.

Shareholders will be asked to approve a merger in which Yadkin Valley will acquire American Community in a cash-and-stock deal valued at approximately $92 million.

Subsidiaries Yadkin Valley Bank and Trust and American Community Bank will also combine.

Under the merger agreement, American Community shareholders will have the right to receive either $12.35 in cash or 0.8517 Yadkin Valley shares for each American Community share, subject to the limitation that 19.5% of the total consideration is to be paid in cash and 80.5% in Yadkin Valley shares.

American Community is the parent of American Community Bank, a Charlotte, N.C.-based state-chartered bank.

Yadkin Valley is a one-bank holding company for Yadkin Valley Bank and Trust located in Elkin, N.C.

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