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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
(Rule 13d-101)
INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT
TO § 240.13d-1(a) AND AMENDMENTS THERETO FILED
PURSUANT TO § 240.13d-2(a)
Under the Securities Exchange Act of 1934
(Amendment No. 3)
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DNB Financial Corporation |
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(Name of Issuer) |
Common Stock, par value $1.00 per share
(Title of Class of Securities)
233237106
(CUSIP Number)
J. Abbott R. Cooper
CT Opportunity Partners I LP
203 Colony Road
Jupiter, FL 33469 917-744-7758
(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications)
April 4, 2019
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report the acquisition which is the subject of this Schedule 13D, and is filing this schedule because of §§240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. ¨
Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See §240.13d-7 for other parties to whom copies are to be sent.
| * | The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page. |
The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes ).
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CUSIP No. 233237106 |
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1 |
NAME OF REPORTING PERSON
CT Opportunity Partners I LP |
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2 |
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
(a) x (b) ¨ |
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3 |
SEC USE ONLY
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4 |
SOURCE OF FUNDS (SEE INSTRUCTIONS)
WC, OO |
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5 |
CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)
☐ |
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6 |
CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware |
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NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
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7 |
SOLE VOTING POWER
256,945 |
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8 |
SHARED VOTING POWER
0 |
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9 |
SOLE DISPOSITIVE POWER
256,945 |
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10 |
SHARED DISPOSITIVE POWER
0 |
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11 |
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
256,945 |
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12 |
CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)
☐ |
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13 |
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
5.95%* |
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14 |
TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
PN |
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| * | The percentage calculations herein are based upon an aggregate of 4,315,518 shares of common stock, par value $1.00 per share, of DNB Financial Corporation outstanding as of November 5, 2018, as reported in the Issuer’s Quarterly Report on Form 10-Q filed with the SEC on November 5, 2018. |
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CUSIP No. 233237106 |
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1 |
NAME OF REPORTING PERSON
CT Opportunity Management LLC |
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2 |
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
(a) x (b) ☐ |
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3 |
SEC USE ONLY
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4 |
SOURCE OF FUNDS (SEE INSTRUCTIONS)
Not Applicable |
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5 |
CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)
☐ |
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6 |
CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware |
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NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
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7 |
SOLE VOTING POWER
256,945* |
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8 |
SHARED VOTING POWER
0 |
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9 |
SOLE DISPOSITIVE POWER
256,945* |
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10 |
SHARED DISPOSITIVE POWER
0 |
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11 |
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
256,945 |
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12 |
CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)
☐ |
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13 |
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
5.95%** |
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14 |
TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
OOO (Limited Liability Company) |
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| * | Solely in its capacity as general partner of CT Opportunity Partners I LP. CT Opportunity Management LLC disclaims beneficial ownership except to the extent of its pecuniary interest therein. |
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| ** | The percentage calculations herein are based upon an aggregate of 4,315,518 shares of common stock, par value $1.00 per share, of DNB Financial Corporation outstanding as of November 5, 2018, as reported in the Issuer’s Quarterly Report on Form 10-Q filed with the SEC on November 5, 2018. |
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CUSIP No. 233237106 |
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1 |
NAME OF REPORTING PERSON
Driver Management Company LLC |
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2 |
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
(a) x (b) ¨ |
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3 |
SEC USE ONLY
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4 |
SOURCE OF FUNDS (SEE INSTRUCTIONS)
WC, OO |
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5 |
CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)
☐ |
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6 |
CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware |
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NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
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7 |
SOLE VOTING POWER
23,000 |
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8 |
SHARED VOTING POWER
0 |
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SOLE DISPOSITIVE POWER
23,000 |
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10 |
SHARED DISPOSITIVE POWER
0 |
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11 |
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
23,000 |
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12 |
CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)
☐ |
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13 |
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
0.53%* |
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14 |
TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
OOO (Limited Liability Company) |
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| * | The percentage calculations herein are based upon an aggregate of 4,315,518 shares of common stock, par value $1.00 per share, of DNB Financial Corporation outstanding as of November 5, 2018, as reported in the Issuer’s Quarterly Report on Form 10-Q filed with the SEC on November 5, 2018. |
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CUSIP No. 233237106 |
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1 |
NAME OF REPORTING PERSON
J. Abbott R. Cooper |
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2 |
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
(a) x (b) ¨ |
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3 |
SEC USE ONLY
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4 |
SOURCE OF FUNDS (SEE INSTRUCTIONS)
Not Applicable |
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5 |
CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)
☐ |
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6 |
CITIZENSHIP OR PLACE OF ORGANIZATION
United States |
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NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
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SOLE VOTING POWER
23,000* |
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8 |
SHARED VOTING POWER
256,945* |
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9 |
SOLE DISPOSITIVE POWER
23,000* |
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10 |
SHARED DISPOSITIVE POWER
256,945* |
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11 |
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
279,945 |
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12 |
CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)
¨ |
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PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
6.49%** |
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14 |
TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
IN |
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| * | Mr. Cooper may be deemed to beneficially own and have shared voting and dispositive power over 256,644 shares as one of the two controlling persons of CT Opportunity Management LLC. Mr. Cooper may be deemed to beneficially own and have sole voting and dispositive power over 23,000 shares as the controlling person of Driver. Mr. Cooper disclaims beneficial ownership of any shares held by any of the Reporting Person except to the extent of his pecuniary interest therein. |
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| ** | The percentage calculations herein are based upon an aggregate of 4,315,518 shares of common stock, par value $1.00 per share, of DNB Financial Corporation outstanding as of November 5, 2018, as reported in the Issuer’s Quarterly Report on Form 10-Q filed with the SEC on November 5, 2018. |
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CUSIP No. 233237106 |
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1 |
NAME OF REPORTING PERSON
John B. Thompson II |
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2 |
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS)
(a) x (b) ¨ |
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3 |
SEC USE ONLY
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4 |
SOURCE OF FUNDS (SEE INSTRUCTIONS)
Not Applicable |
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5 |
CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)
☐ |
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6 |
CITIZENSHIP OR PLACE OF ORGANIZATION
United States |
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NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH
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7 |
SOLE VOTING POWER
0 |
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8 |
SHARED VOTING POWER
256,945* |
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9 |
SOLE DISPOSITIVE POWER
0 |
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10 |
SHARED DISPOSITIVE POWER
256,945* |
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11 |
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
256,945 |
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12 |
CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS)
¨ |
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13 |
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
5.95%** |
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14 |
TYPE OF REPORTING PERSON (SEE INSTRUCTIONS)
IN |
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| * | Mr. Thompson may be deemed to beneficially own these shares as one of the two controlling persons of CT Opportunity Management LLC. Mr. Thompson disclaims beneficial ownership of any shares held by any of the Reporting Person except to the extent of his pecuniary interest therein. |
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| ** | The percentage calculations herein are based upon an aggregate of 4,315,518 shares of common stock, par value $1.00 per share, of DNB Financial Corporation outstanding as of November 5, 2018, as reported in the Issuer’s Quarterly Report on Form 10-Q filed with the SEC on November 5, 2018. |
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This Amendment No. 3 to Schedule 13D (this “Amendment No. 3”) relates to the Schedule 13D filed on January 17, 2019 (as amended and supplemented through the date of this Amendment No. 3, the “ Schedule 13D ”) by (a) CT Opportunity Partners I LP, a Delaware limited partnership, (b) CT Opportunity Management LLC, a Delaware limited liability company, (c) Driver Management Company LLC, a Delaware limited liability company, (d) J. Abbott R. Cooper, citizen of the United States of America, and (e) John B. Thompson II, a citizen of the United States of America, relating to the common stock, par value $1.00 per share (the “ Common Stock ”), of DNB Financial Corporation, a Delaware corporation (“ DNB ” or the “ Issuer ”).
Capitalized terms used but not defined in this Amendment No. 3 shall have the meanings set forth in the Schedule 13D. Except as specifically amended by this Amendment No. 3, the Schedule 13D is unchanged.
Item 4. Purpose of Transaction
Item 4 of the Schedule 13D is hereby amended and supplemented by adding the following information:
Since mid-February 2019, the Reporting Persons have had numerous conversations with members of the Issuer’s board regarding a potential arrangement pursuant to which, among other things, the Issuer would share certain information with the Reporting Persons. On March 23, 2019, at the request of the Issuer, the Reporting Persons submitted proposed terms (the “March 23 Term Sheet”) for such an arrangement to the Issuer’s attorney. The March 23 Term Sheet is attached hereto as Exhibit 99.6 and incorporated herein by reference.
On March 28, 2019, the Issuer’s attorney informed the Reporting Persons’ attorney that the Issuer had declined to accept the proposal contemplated by the March 23 Term Sheet.
Item 7. Exhibits.
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Exhibit |
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Description |
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Joint Filing Agreement by and among the Reporting Persons, dated January 18, 2019 |
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| 7 |
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SIGNATURE
After reasonable inquiry and to the best of each of the undersigned’s knowledge and belief, each of the undersigned certifies that the information set forth in this statement is true, complete and correct.
Dated: April 4, 2019
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CT Opportunity Partners I LP By: CT Opportunity Management LLC, its general partner |
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By: |
/s/ J. Abbott R. Cooper |
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Name: J. Abbott R. Cooper Title: President |
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CT Opportunity Management LLC |
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By: |
/s/ J. Abbott R. Cooper |
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Name: J. Abbott R. Cooper Title: President |
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Driver Management Company LLC |
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By: |
/s/ J. Abbott R. Cooper |
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Name: J. Abbott R. Cooper Title: Manager |
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By |
/s/ J. Abbott R. Cooper |
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J. Abbott R. Cooper |
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By |
/s/ John B. Thompson II |
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John B. Thompson II |
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8 |
EXHIBIT 99.6
Proposed Board Observer, Confidentiality & Standstill Terms
(key terms; non-binding; for discussion purposes only)
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Transaction Committee: |
The Board of Directors (the “ Board ”) of DNB Financial Corp (the “ Company ”) shall formally constitute a Strategy Committee of the Board (the “ Strategy Committee ”), comprised of John Thornton and two other independent members of the Board.
The Board shall delegate to the Strategy Committee, to the fullest extent permitted by law, the full authority of the Board over the matters raised in the Reporting Persons’ Schedule 13D filed on January 17, 2019, including any proposed sale, merger, business combination or similar transaction involving the Company (a “ Transaction ”).
The Board shall have provided the Reporting Persons with a copy of the resolutions forming the Strategy Committee prior to the execution of definitive agreements. |
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Board Observer: |
Abbott Cooper shall be appointed as an observer to the Board (the “ Observer ”), with the right to attend, in a non-voting, observer capacity: (1) all meetings of the Strategy Committee; and (2) such portions of each other Board or committee meeting where the matters delegated to the Strategy Committee (“ Strategy Committee Matters ”) are discussed, reviewed or decided upon.
If Abbott Cooper is unable to serve as an Observer for any reason, the Reporting Persons may designate a replacement who is reasonably acceptable to the Board. |
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Information Rights: |
The Observer will be provided with copies of all notices, minutes, agendas, consents, presentations, memos and other material that are provided to Transaction Committee members or that are provided to Board members with respect to the Transaction Committee Matters, with omissions only (in the opinion of the Board’s counsel) to preserve attorney-client privilege or as required by law or regulation.
The Observer shall have the same access rights as a full member of the Board to the Company management and advisors, including any financial advisor engaged by the Board or the Transaction Committee with respect to a potential sale process. |
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Confidentiality: |
The Reporting Persons shall agree to customary confidentiality protections over all materials provided to the Observer in his capacity as an Observer or raised at a Board or committee meeting attended by the Observer (the “ Evaluation Material ”) and shall agree not to use the Evaluation Material except to monitor and seek to enhance the value of the Reporting Persons’ investment in the Company. These restrictions shall survive for 1 year after termination.
The Reporting Persons shall agree not to purchase or sell Company securities except during the Company’s trading window or as permitted by the Company’s Section 16 trading policies, which policies shall have been provided to the Reporting Persons. |
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Standstill: |
The Reporting Persons shall (1) agree to a customary standstill consistent with Section 4 of the following: http://www.sec.gov/Archives/edgar/data/745981/000162828018013150/midsouth-bcmxboardobserver.htm; and (2) withdraw their books & records request. |
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Term: |
This agreement shall terminate on the earlier to occur of: (1) the consummation of a Transaction in which shareholders of the Company own less than 50% of the surviving entity (or its ultimate parent company); (2) the Reporting Persons terminating the agreement after the 6-month anniversary of signing; (3) the Board terminating the agreement after the 18-month anniversary of signing; or (4) the Reporting Persons ceasing to beneficially own at least 5% of the Company’s issued and outstanding shares (excluding new issuances by the Company). |
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Expenses: |
Company to reimburse the Reporting Persons’ reasonable and documented expenses in connection with this matter, as well as reasonable out-of-pocket expenses related to the Observers’ attendance at Strategy Committee and Board meetings. |
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Indemnity / Insurance: |
The Company will indemnity the Observer to the same extent a director would be indemnified and shall be covered by the Company’s insurance applicable to directors and officers. |