Mason-Dixon changes its proxy statement Injunction sought by shareholders spurs move by executives

March 18, 1997|By Bill Atkinson | Bill Atkinson,SUN STAFF

Executives of Mason-Dixon Bancshares Inc. agreed to remove phrases and words from its new proxy statement that could be misleading, an attorney for the company said yesterday.

The changes were made at a hearing before U.S. District Judge William Nickerson, after a group of shareholders sought a temporary restraining order to block Mason-Dixon from issuing its proxy if alleged "false and misleading" statements about the stockholder group's intentions weren't removed.

The shareholders' group, led by Barbara Floyd, a former NTC Mason-Dixon employee, wants management to consider selling the company. It has alleged in a lawsuit that Mason-Dixon's top two executives intentionally blocked acquisition attempts and caused stockholders to suffer millions in losses.

The Mason-Dixon executives deny the allegations.

Both sides claimed victory in the wake of a hearing in U.S. District Court in Baltimore Friday night.

"The changes in our view did not really change the substance of the statement in opposition to the stockholders' proposal submitted by Barbara Floyd," said Ava Lias-Booker, an attorney representing the Westminster-based banking company, which has $838 million in assets and is the parent of Carroll County Bank and Trust Co., and Bank of Maryland in Towson.

She said the bank met its goal of mailing the proxies yesterday to 4,000 shareholders.

David R. Breschi, an attorney representing the 19 dissident shareholders, said they forced the bank to remove the statements they objected to.

"A bit to our surprise, they were very willing to make a lot of the changes we asked for," he said.

One change the bank agreed to was deleting the fact that Floyd, who worked as a chief financial officer at Carroll County Bank, had sued the company, alleging she wasn't fairly paid.

The shareholder group expects to mail its own proxy this week to Mason-Dixon stockholders calling for Floyd and at least a second dissident to be named to the board.

The group filed a lawsuit last week seeking $97 million in damages from Mason-Dixon's president, Thomas K. Ferguson, and its chairman, William Dulany.

The shareholders allege that Dulany and Ferguson have acted as "roadblocks" to banks interested in talking to Mason-Dixon about merging.

In its own lawsuit, the bank has alleged that the group illegally acquired 5.1 percent of the company in violation of federal securities laws and Maryland bank acquisition laws.

Pub Date: 3/18/97

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