DEFC14A: Dream Chasers Group Seeks Board Representation at Carver Bancorp, Inc.

Dream Chasers Capital Group is soliciting proxies to elect two nominees to Carver Bancorp's board at the upcoming 2024 annual meeting.

Summary

• Dream Chasers Capital Group is seeking shareholder support to elect Jeffrey Bailey and Jeff Anderson to the board of Carver Bancorp, Inc. at the 2024 annual meeting on December 12, 2024.
• The Dream Chasers Group, which includes Gregory Lewis, Shawn Herrera, Kevin Winters, Jeffrey Bailey, and Jeff Anderson, collectively owns approximately 9.7% of Carver's outstanding shares as of October 15, 2024.
• They are urging shareholders to vote for their nominees and withhold votes for two of the company's nominees, Kenneth J. Knuckles and Jillian E. Joseph.
• Dream Chasers is also recommending a vote against the advisory resolution to approve executive compensation (Proposal 4).
• The group makes no recommendation on Proposals 2 and 3, related to the equity incentive plan and auditor ratification, respectively, and will abstain from voting on these if no instructions are provided.
• The proxy statement outlines the background to the solicitation, including previous attempts by Dream Chasers to engage with Carver on a potential business combination and an offer to purchase 35% of the company's stock.
• The document emphasizes the qualifications and experience of the Dream Chasers nominees, arguing they will bring valuable expertise and an ownership mentality to the boardroom.
• The solicitation is being conducted by Dream Chasers, not on behalf of Carver's board of directors.
• The Dream Chasers Group has retained Okapi Partners LLC to assist in communicating with shareholders in connection with the proxy solicitation and to assist in efforts to obtain proxies.

Sentiment

Score: 4

Explanation: The sentiment is somewhat negative due to the proxy fight, criticism of executive compensation, and the company's stock performance. However, the document expresses confidence in the potential of the Dream Chasers nominees to improve the company.

Positives

• Dream Chasers believes its nominees will bring valuable expertise and an ownership mentality to the boardroom.
• Jeffrey Anderson has a successful track record of increasing corporate profitability and shareholder value.
• Jeffrey Bailey has experience in managing banking relationships and growing a business significantly.
• The addition of motivated independent directors, including Mr. Bailey having a significant ownership stake, would help to bring an ownership mentality to the boardroom and increase transparency and accountability.

Negatives

• Dream Chasers believes the company's performance does not justify the executive officer compensation.
• The company's stock price reached an all-time low in October 2023.
• The company rejected Dream Chasers' offer to purchase 35% of its common stock.
• Total shareholder returns over the last ten years do not justify the executive compensation that the Board has approved over that time.

Risks

• If elected, the Dream Chasers nominees will only represent two out of seven members of the Board, and if only one is elected he will represent one out of seven members of the Board, and therefore there can be no assurance that either Jeffrey Bailey or Jeff Anderson individually can implement the actions that they believe are necessary to enhance shareholder value.
• There is no assurance that any of the Company’s other directors will continue to serve as directors if either of the Dream Chasers Groups nominees are elected to the Board.

Future Outlook

The Dream Chasers Group aims to improve Carver's performance by enhancing corporate governance practices, fixing operations and strategy, and improving capital allocation.

Management Comments

• WE BELIEVE JEFFREY BAILEY AND JEFF ANDERSONS SIGNIFICANT EXPERTISE AND LONG TRACK RECORD OF BUSINESS EXPERIENCE WILL BE INVALUABLE TO THE COMPANY AS IT WORKS TO OVERCOME ITS CHALLENGES.
• ACCORDINGLY, THE DREAM CHASERS GROUP URGES YOU TO VOTE YOUR BLUE UNIVERSAL PROXY CARD FOR THE DREAM CHASERS NOMINEES, TO WITHHOLD ON THE OPPOSED COMPANY NOMINEES, AND TO VOTE AGAINST PROPOSAL 4.

Industry Context

This proxy fight reflects a growing trend of activist investors seeking to influence corporate strategy and governance, particularly in companies they believe are underperforming.

Comparison to Industry Standards

• It is difficult to compare Carver Bancorp to industry standards without more detailed financial information.
• However, community banks are generally evaluated on metrics such as return on assets (ROA), return on equity (ROE), and efficiency ratio.
• Comparing these metrics to peers like OneUnited Bank or Industrial Bank would provide a better understanding of Carver's relative performance.

Stakeholder Impact

• The outcome of the proxy vote could impact shareholders through changes in the company's direction and governance.
• Employees could be affected by potential changes in strategy and operations.
• The community served by Carver Bancorp could see changes in the company's role and impact.

Next Steps

• Shareholders need to vote on the BLUE universal proxy card by December 11, 2024.
• The results of the vote will be announced at the 2024 Annual Meeting on December 12, 2024.

Key Dates

Keywords

proxy solicitation, board election, Dream Chasers Capital Group, Carver Bancorp, shareholders, nominees, corporate governance, executive compensation