SOURCE: First Bank

June 06, 2008 10:06 ET

First Bank to Recapitalize With Infusion From Prominent Central NJ Banking Group

WILLIAMSTOWN, NJ--(Marketwire - June 6, 2008) - First Bank (OTCBB: FRBA) announced today that it has entered into an agreement to recapitalize the bank with an investment of $15 - $30 million in additional capital from a group of central New Jersey bank investors led by Leslie E. Goodman and Patrick L. Ryan.

The investment will be structured as a secondary offering of securities by First Bank. The terms of the offering will provide for the sale of units of the Bank, with each unit to consist of a share of common stock and 1/4 of a warrant to purchase an additional share of common stock. The price of the offering will be $7.90 per unit. The warrants will have a term of five years, and an exercise price of $9.00 per share. The offering is expected to close in August or September of 2008, and is subject to regulatory approval.

As part of the transaction, First Bank will reconstitute its Board of Directors. The Bank will increase the size of the Board from 9 to 11. Should the investor group raise $18 million or more in new capital, 7 of the 11 Board members will be from the investment group. In addition to the modification to the Board, First Bank will name Leslie E. Goodman as its Chairman and retain Patrick L. Ryan as Executive Vice President and Chief Operating Officer. James Loney, First Bank President and CEO, will remain in that position.

The bank will use the new capital to build a central and south New Jersey community banking franchise to go along with the growth First Bank has seen in its first year of operation. The Bank plans to open a new office location in Ewing, New Jersey shortly after the close of the transaction.

"We are excited about this partnership with First Bank," stated lead investor Les Goodman. "Our group perceives a real void in the marketplace in central New Jersey for a good, commercially focused, sizable community-banking franchise. We believe this investment in First Bank will create the platform we need to take advantage of this exciting market opportunity." Mr. Goodman has over 40 years of commercial and community banking experience, having held leadership positions at First Union Bank (now known as Wachovia) and its predecessors First National State Bank and First Fidelity. He was also a key Director at Admiralty Bank in Palm Beach County, Florida and now serves as Vice Chairman of Anchor Commercial Bank in Florida.

Other key business leaders, including several individuals directly involved with the management and oversight of Yardville National Bank, are part of the investment group. In addition to Messrs. Goodman and Ryan, members of the investment group include Elbert Basolis, Stephen Carman, Gerry Finn, Peter Halstead, Sidney Hofing, Glenn Josephs, Michael Koretsky, Dr. Eli Mordechai, Tony Privatera, John Strydesky, Chris Vernon, and Leo Zamparelli.

"This transaction provides the necessary capital and additional banking experience to create a highly profitable community banking organization," noted First Bank CEO James Loney.

"We believe this is a great investment opportunity," commented Lead investor Patrick L. Ryan. "This organization will have great opportunities for growth. As a clean, well-capitalized institution operating at a time when many banks are dealing with internal issues, we believe we'll have a real advantage in the marketplace." Mr. Ryan's experience includes investment banking (Goldman Sachs), management consulting (Bain and Company), and community banking (Yardville National Bank).

The company expects to have an offering memorandum available for potential investors in June 2008. Subscriptions will be solicited during July and August 2008, and the recapitalization is expected to close in late August or September of 2008.

Hovde Financial acted as financial advisor to the lead investors. The law firm of Windels Marx Lane and Mittendorf LLP provided legal counsel to the lead investors. Sheshunoff and Company and CBIA Advisors, Inc. acted as financial advisors to First Bank and Archer and Greiner, P.C. provided legal counsel.

Contact Information