Coastal Bank & Trust

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Ademi LLP is investigating Coastal (OTC Pink: CABT) for possible breaches of fiduciary duty and other violations of law in its transaction with PB Financial.

In the transaction, Coastal stockholders are expected to receive only $10.00 in cash or 0.2222 shares of PB Financial common stock for each share of Coastal common stock that is exchanged in the merger, subject to a proration if either election is oversubscribed. The aggregate combined stock and cash merger consideration Coastal shareholders will receive in the merger is valued at approximately $25.8 million. The transaction agreement unreasonably limits competing transactions for Coastal by imposing a significant penalty if Coastal accepts a competing bid. Coastal insiders will receive substantial benefits as part of change of control arrangements.

We are investigating the conduct of Coastal’s board of directors, and whether they are fulfilling their fiduciary duties to all shareholders.