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Tampa Business & Commercial Law Blog

Bank merger will increase Seacoast Banking Corp.'s holdings

Federal Deposit Insurance Corp. records indicate that Seacoast Banking Corporation (Seacoast) currently serves Florida residents at 48 Seacoast National Bank locations. Seacoast recently announced that it is increasing that number through a merger with three Grand Bank & Trust of Florida branches currently owned by Grand Bankshares, Inc. (Grand). Current Grand customers will ultimately have access to all of the services offered by Seacoast.

When Seacoast takes control of the branches, its assets will increase by approximately $207.8 million. The bank will also receive net loans and leases valued at nearly $123.3 million, deposits of approximately $184.6 million and repossessed properties of around $8.2 million. Seacoast is expected to purchase Grand's three branches with a combination of cash and stock. The estimated value of the transaction is $16.2 million, which represents around 77 percent of the last reported value of Grand's Tier 1 capital.

Dispute resolution ends in almost $150M settlement by Duke Energy

Duke Energy holds the distinction of being the largest electric company in the United States with over seven million customers across six states, including Florida. However, that did not stop several of the company's shareholders from filing a lawsuit against it after its buyout of Progress Energy Inc. in July 2012. Recently, dispute resolution efforts resulted in a settlement whereby Duke Energy will pay out somewhere around $150M to its shareholders.

The lawsuit was filed in the wake of the termination of the company's CEO within hours of when the buyout was finalized. Shareholders claim that Duke Energy made certain misrepresentations regarding the terms of the buyout. Even though the electric company has settled the lawsuit, it denies that it did anything wrong.

Florida sandwich company files Chapter 11 bankruptcy

When a Florida company's business declines, it could quickly encounter financial difficulties. If the situation becomes dire, filing for Chapter 11 bankruptcy could give a business the time it needs to reorganize, which could allow the company to remain viable. Owners of a Spanish mini-sandwich company called 100 Montaditos filed Chapter 11 on March 4 and may be hoping to regroup.

Four related companies, including 100 M Holdings, which is the parent company of 100 Montaditos in the United States, filed individual petitions in federal Bankruptcy Court here in Florida. The other three companies are 100 M Lincoln, 100 M Franchise and 100 M Operator. Nine separate restaurants, eight of which are located in south Florida, also filed.

An alternative to bankruptcy liquidation

Many Florida companies encounter financial problems. Sometimes, the circumstances are such that filing for bankruptcy appears to be the best option available. However, there may be another option that could provide a better resolution to a company's difficulties.

An Assignment for the Benefit of Creditors (ABC) may generate more revenue to repay creditors than a bankruptcy liquidation. In an ABC, the assets of the company are assigned to an independent third party. The assignee, as the third party is called, becomes responsible for the sale of the assets. The proceeds are then distributed to your creditors.

Campbell Soup discussses corporate restructuring in Florida

In order for a business to thrive, it must be willing to change in order to adapt to an ever-changing market. Even large corporations like Campbell Soup need to make adjustments to remain competitive. In Feb. 2015, the company provided details of its plan for corporate restructuring, which was announced at the end of January at a conference in Florida.

At the core of the company's plan are cost reduction initiatives that are aimed at reducing costs over the next three years by approximately $200 million. The savings could then be applied to those portions of the company in which significant growth is anticipated. However, cost savings are not enough.

Sales of businesses do not always proceed as planned

A Florida developer made a $95.4 million deal to purchase a struggling casino in the gambling capital of the northeast. However, the Revel Casino Hotel is asking its bankruptcy judge to cancel the sale. If the developer is not allowed to go through with the purchase, this will make two failed sales of the casino.

The casino says that it wants to cancel the sale because, for the second time, a dispute has cropped up over the casino's power plant. In addition to the power plant, the nightclubs and restaurants associated with the casino are also disputing the sale for fear of losing their leases. At this point, it is unclear whether those properties were included in the sale to the Florida developer.

Will Radio Shack be able to restructure under Chapter 11?

Radio Shack used to be the country's premier electronics dealer. However, Florida residents may not know that in recent years, the company has sustained steady losses when it was not able to transform itself into a successful cell phone retailer. The company has now filed for Chapter 11 bankruptcy protection and might just avoid going out of business entirely.

As part of the company's proposal to restructure the business, it brokered a deal with its biggest shareholder and lender, Standard General. Radio Shack currently has over 4,000 locations. As part of the deal, the company agreed to sell between 1,500 and 2,400 of them to General Wireless, which is an affiliate of Standard General. Sprint Corp. is ready to set up shop in these locations and will occupy about one-third of the store, which Sprint says will allow the cell phone retailer to provide faster and better service to both current and potential customers. Moreover, in a side deal with Standard General, Sprint would also take over operations of up to 1,750 of Radio Shack's other locations.

Seminoles cancel another bank acquisition

The Seminole Tribe of Florida has backed out of its plans to acquire a bank for the second time within the past 10 months. In May 2014, the tribe had filed an application with the intent to acquire Valley Bank, located in Fort Lauderdale. Tribe leaders planned to rename the location Seminole Bank, as well as inject capital and provide it with a holding company that was owned by the tribe.

The existing bank was described as being undercapitalized, consisting of four branches that were underutilized and assets worth more than $84 million. The application was filed on May 7, but the tribe stopped the acquisition approximately one month later. The tribe claimed that after performing a thorough review, it decided to wait for an opportunity to acquire another bank investment in the near future. During the third quarter of 2014, the tribe publicized its intent to acquire Mackinac Savings Bank in Boynton Beach.

Family Dollar and Dollar Tree set to merge

On Jan. 22, Family Dollar Stores shareholders voted to merge with Dollar Tree in an $8.5 billion deal. The merger will allow Family Dollar to retain its brand identity, and the CEO of Family Dollar will have a seat on the board of directors of the merged company. Almost 90 percent of Family Dollar shareholders approved the merger of the two discount chain retailers.

In early 2014, the CEO of Family Dollar put his company up for sale after making several ill-timed business decisions, including an over-expansion and a pricing change. Although many people speculated that Dollar General would purchase Family Dollar, Dollar Tree ultimately won the bid.

Chapter 11 bankruptcy for Florida businesses

Florida businesses that are in trouble with their debts may choose to reorganize them through filing of a Chapter 11 petition. Through this mechanism, the business's debts can be reorganized while the debtor is able to remain in possession of the business. In some cases, a business's creditors may force a business to file Chapter 11 bankruptcy as well.

A Chapter 11 bankruptcy proceeding begins with filing the petition and paying the filing fee of $1,167 along with a $500 administrative fee. In addition to the bankruptcy petition, the debtor must also file a schedule of liabilities owed and assets owned, an income and expenditures schedule, a statement of financial affairs and a statement of all unexpired leases and executory contracts.

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