Republic Bank, Norcross Braca Group announce Letter of Intent with significant investment

A prolonged struggle for control of Republic Bank appears to be at an end.

Republic First Bancorp, the parent company of Republic First Bank d/b/a Republic Bank, together with George Norcross III, Gregory Braca, Philip Norcross and affiliates on Thursday said the Norcross Braca Group will invest at least $35 million as part of a $75 million capital raise and will gain membership on a reconstituted board.

According to the Letter of Intent, as a condition to the investment, in addition to the $35 million invested by the group, the company will raise at least $40 million of additional capital from third-party investors. The company anticipates that the proceeds of the capital raise will be used to strengthen Republic’s financial position and improve its operations, all with the goal of enhancing shareholder value.

Once the capital raise is completed, the company’s board would consist of nine members, including two directors designated by the Norcross Braca Group, two candidates put forth by the additional investors, two new independent directors, the company’s CEO and two legacy independent directors.

In the interim, with the execution of a definitive agreement for the capital raise, the Norcross Braca Group will have the right to appoint two non-voting observers to the board.

Pursuant to the LOI, upon the execution of a definitive agreement for the capital raise, the Norcross Braca Group will dismiss all litigation against Republic and cease its proxy solicitation efforts. Upon the consummation of the capital raise, Republic will pay certain fees and expenses of the Norcross Braca Group and assume certain investment banking and legal expenses.

“As significant Republic shareholders, we believe in the company’s potential and are excited about being part of its next chapter. We appreciate the board’s engagement throughout this process and look forward to working together. Ultimately, we share a common goal: helping the company deliver outstanding service to its customers and depositors, investing in its communities and employees and improving value for shareholders,” George Norcross said.

Squire Patton Boggs (US) LLP and Vinson & Elkins LLP are serving as legal advisers to the company. Sullivan & Cromwell LLP and Ballard Spahr are serving as legal advisers to the Norcross Braca Group.