Driver Management Makes Public Key Documents Related to Codorus Valley Bancorp’s Questionable $8.04 Million Loan

Rhea-AI Summary

Driver Management Company has published key court documents concerning Codorus Valley Bancorp (NASDAQ: CVLY) regarding a controversial $8.04 million loan for a replica Ferrari. Driver, owning 6.72% of outstanding shares, criticizes current leadership for neglecting fiduciary duties and urges for board changes to better oversee management actions. The firm has nominated three independent candidates for the Board at the upcoming annual meeting, reinforcing its stance on the need for shareholder-driven governance reforms.

Positive

• Driver Management's public disclosure of court documents enhances transparency for shareholders.
• The nomination of three independent candidates for the Board could lead to improved governance and oversight.

Negative

• The company made an $8.04 million loan secured by a replica Ferrari, indicating poor management judgment.
• Current directors appear to prioritize their positions over shareholder interests, raising concerns about leadership accountability.

Publishes Legal Documents Filed by the Company in Federal Court so Shareholders Can View the Facts

Believes Leadership's Apparent Neglect of Its Fiduciary Duties and Refusal to Take Responsibility Reaffirms the Case for Shareholder-Driven Change in the Boardroom

NEW YORK--(BUSINESS WIRE)-- Driver Management Company LLC (together with its affiliates, “Driver” or “we”), the beneficial owner of 6.72% of the outstanding shares of Codorus Valley Bancorp, Inc. (NASDAQ: CVLY) (“Codorus Valley” or the “Company”), today made public key documents filed by the Company in federal court regarding the questionable $8.04 million loan (the "Faux-rrari loan") it issued for a replica Ferrari vehicle. The documents can be viewed here.

Abbott Cooper, Driver’s founder and managing member, commented:

“Following the Company's claims that we are making misleading statements, we have made public key documents – filed by the Company in a lawsuit in federal court – regarding the Faux-rrari loan so shareholders (and other interested parties) can make their own determination about who is misleading who.

According to these documents, the Company has admitted that it was duped into making a loan that was secured by a replica Ferrari. It is appalling that rather than holding themselves and management accountable for this clear dereliction of duty, the incumbent directors seem more interested in wasting shareholders’ capital to preserve their board seats.

This series of events raises serious concerns regarding management's competence and judgement, the Company's underwriting process and the Board's commitment to faithfully performing its fiduciary duties. In our view, the situation reaffirms our belief that shareholder-driven boardroom change is urgently needed to help the Board properly oversee management, overhaul the Company's governance and deliver value to long-suffering shareholders.”

As a reminder, Driver has nominated three highly qualified and independent candidates – Aashish R. Kamat, John E. Kiernan and A. Dwight Utz – for election to the Board at the 2022 Annual Meeting of Shareholders.

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About Driver Management Company

Driver employs a valued-oriented, event-driven investment strategy that focuses exclusively on equities in the U.S. banking sector. The firm’s leadership has decades of experience advising and engaging with bank management teams and boards of directors on strategies for enhancing shareholder value. For information, visit www.drivermanagementcompany.com.

CERTAIN INFORMATION CONCERNING THE PARTICIPANTS

Driver Management Company LLC, together with the other participants named herein (collectively, “Driver”), intends to file a preliminary proxy statement and accompanying WHITE proxy card with the Securities and Exchange Commission to be used to solicit votes for the election of its slate of highly-qualified director nominees at the 2022 annual meeting of shareholders of Codorus Valley Bancorp, Inc., a Pennsylvania Company (the “Company”).

DRIVER STRONGLY ADVISES ALL SHAREHOLDERS OF THE COMPANY TO READ THE PROXY STATEMENT AND OTHER PROXY MATERIALS AS THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. SUCH PROXY MATERIALS WILL BE AVAILABLE AT NO CHARGE ON THE SEC’S WEB SITE AT HTTP://WWW.SEC.GOV. IN ADDITION, THE PARTICIPANTS IN THIS PROXY SOLICITATION WILL PROVIDE COPIES OF THE PROXY STATEMENT WITHOUT CHARGE, WHEN AVAILABLE, UPON REQUEST. REQUESTS FOR COPIES SHOULD BE DIRECTED TO THE PARTICIPANTS’ PROXY SOLICITOR.

The participants in the proxy solicitation are anticipated to be Driver Management Company LLC (“Driver Management”), Driver Opportunity Partners I LP (“Driver Opportunity”), J. Abbott R. Cooper, Aashish Kamat, John E. Kiernan and A. Dwight Utz.

As of the date hereof, the participants in the proxy solicitation beneficially own in the aggregate 640,880 shares of Common Stock, par value $2.50 per share, of the Company (the “Common Stock”). As of the date hereof, Driver Opportunity beneficially owns directly 640,880 shares of Common Stock, including 1,000 shares held in record name. As the general partner of Driver Opportunity, Driver Management may be deemed to beneficially own the shares of Common Stock directly beneficially owned by Driver Opportunity. Mr. Cooper, as the Managing Member of Driver Management, may be deemed to beneficially own the shares of Common Stock directly beneficially owned by Driver Opportunity. As of the date hereof, none of Messrs. Kamat, Kiernan or Utz own beneficially or of record any securities of the Company.

View source version on businesswire.com: https://www.businesswire.com/news/home/20220311005105/en/

Longacre Square Partners

Charlotte Kiaie / Bela Kirpalani, 646-386-0091

driver@longacresquare.com

Source: Driver Management Company LLC

FAQ

What are the key issues raised by Driver Management regarding Codorus Valley Bancorp (CVLY)?

Driver Management highlights management's failure in fiduciary duties and the questionable decision to issue an $8.04 million loan for a replica Ferrari.

What is the significance of the documents published by Driver Management about CVLY?

The published documents provide insights into management's decisions, highlighting accountability issues related to the controversial loan.

Who are the independent candidates nominated by Driver Management for CVLY's Board?

Driver Management has nominated Aashish R. Kamat, John E. Kiernan, and A. Dwight Utz for election to Codorus Valley's Board.

What percentage of Codorus Valley Bancorp does Driver Management own?

Driver Management is the beneficial owner of 6.72% of the outstanding shares of Codorus Valley Bancorp.

Why does Driver Management believe change is needed in CVLY's Boardroom?

Driver Management asserts that shareholder-driven changes are necessary to enhance oversight of management and improve governance practices.