According to the complaint, this is a shareholder class action brought by Plaintiff on behalf of holders of the common stock of Green Bankshares, Inc. ("GRNB" or "Company"), a Tennessee bank holding company, to enjoin the acquisition of the publicly owned shares of GRNB common stock by North American Financial Holdings, Inc. ("NAFH"). On May 5, 2011, NAFH announced that it had entered into a definitive agreement whereby NAFH, through its wholly-owned subsidiary, would acquire a 90.1 % stake in GRNB for $217 million ("Proposed Transaction"). Under the terms of the agreement ("Acquisition Agreement"), approximately 120 million shares of GRNB common stock will be issued at a price of $1.81 per share to NAFH, significantly diluting current common shareholders of GRNB.
Current GRNB common shareholders will only receive a Contingent Value Right ("CVR"), entitling them to cash proceeds of up to $0.75 per share, based on the credit performance of GRNB's legacy loan portfolio over the five years following the deal's closing. The Acquisition Agreement contemplates that GRNB will be combined with NAFH at a future date.
Despite the recent financial crisis, GRNB is "a well-capitalized financial institution." Press Release, GRNB, Green Bankshares Reports Results For the First Quarter 2011 (May 10, 2011). GRNB stock traded as high as $3.46 as recently as March 1, 2011 and $3.53 on February 15, 2011. Furthermore, GRNB has a trailing twelve month book value per share price of $4.91.
Indeed, on May 10, 2011, GRNB's Chairman of the Board and CEO, Defendant Stephen M. Rownd stated, "Our core earnings and the fundamentals of the Company remain solid." In facilitating the acquisition of over 90% of GRNB by NAFH for grossly inadequate consideration and through a flawed process, each of the defendants breached and/or aided the other defendants' breaches of their fiduciary duties. In addition, by making misleading statements and material omissions in the Company's proxy statement dated June 6, 2011 ("Proxy Statement"), the Individual Defendants, defined below, and GRNB violated Section 14(a).
On February 14, 2012, the Plaintiff filed a Notice voluntarily dismissing this action without prejudice.