UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): August 26, 2009
GREATER ATLANTIC FINANCIAL CORP.
(Exact Name of Registrant as Specified in its Charter)
Delaware 0-26467 54-1873112
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(State or Other Jurisdiction) (Commission File No.) (I.R.S. Employer
of Incorporation) Identification No.)
10700 Parkridge Boulevard, Suite P50, Reston, VA 20191
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (703) 391-1300
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Not Applicable
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(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities Act (17
CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17
CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the
Exchange Act (17 CFR 240.14d-2(b))
[X] Pre-commencement communications pursuant to Rule 13e-4(c) under the
Exchange Act (17 CFR 240.13e-4(c))
Item 8.01 Other Events
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On August 14, 2009, members of the Board of Directors and certain officers
of Greater Atlantic Financial Corp. (the "Company"), the parent company of
Greater Atlantic Bank (the "Bank"), received a demand letter from Richard C.
Litman, who claims to be a shareholder of the Company ("Litman"), stating the
alleged basis for a stockholder derivative action and demanding such persons
take immediate action to protect the interests of common stockholders of the
Company.
On August 26, 2009, Litman filed a stockholder derivative lawsuit (Case
Number CA4837-VCP) in the Delaware Court of Chancery against the Company, the
Bank, Greater Atlantic Capital Trust I (the "Trust"), the current members of the
Boards of Directors of the Company and the Bank and the estate of a deceased
member of the Boards of Directors, BDO Seidman, LLP (the auditor of the
Company), and an individual stockholder of the Company (the "Stockholder"). The
lawsuit also names as defendant Comstock Partners, LC, MidAtlantic Bancorp, Inc.
and GAF Merger Corp. As previously announced by the Company, on June 15, 2009
the Company entered into a definitive Agreement and Plan of Merger with
MidAtlantic Bancorp, Inc. and GAF Merger Corp., pursuant to which MidAtlantic
Bancorp, Inc. will acquire the Company (the "Merger").
The demand letter and the lawsuit allege, among other things, certain
breaches of the duty of loyalty and other breaches of fiduciary duty by the
director and officer defendants; aiding and abetting such breaches of fiduciary
duty by the Stockholder, the Company, the Bank, the Trust and BDO Seidman; and
aiding and abetting such breaches of fiduciary duty by Comstock Partners, LC,
MidAtlantic Bancorp, Inc. and GAF Merger Corp. The action further seeks to
prevent the alleged unjust enrichment of the defendants who received value from
the Company prior to the filing of the lawsuit and those who will be paid money
or receive value subsequent to the filing from the proposed Merger, from the
anticipated tender offer for the trust preferred securities issued by the Trust,
or by remaining as a trust preferred holder of the Trust after the Merger.
The Company and its legal counsel are evaluating the demand letter and the
Company has referred the lawsuit to Delaware counsel for review and evaluation
of the merits of the claims noted therein.
Additional Information about the Tender Offer
As described above, in connection with the merger transaction, the Company
will initiate a tender offer for the outstanding trust preferred securities
issued by the Trust.
This Form 8-K is neither an offer to purchase nor a solicitation of an
offer to sell trust preferred securities of the Trust. The tender offer has not
yet commenced. At the time the offer is commenced, the Company will file
definitive tender offer materials with the SEC, including final versions of the
Offer to Purchase, a related Letter of Transmittal and certain other offer
documents. We urge holders of the Company's trust preferred securities to read
the final tender offer materials when they become available because they will
contain important information that should be read carefully before any decision
is made with respect to the tender offer. The Offer to Purchase, the related
Letter of Transmittal and certain other offer documents will be made available
to all holders of the trust preferred securities at no expense to them. The
tender offer materials will be available for free at the SEC's website at
http://www.sec.gov. In addition, holders of the trust preferred securities will
be able to obtain a free copy of these documents from the information agent for
the tender offer, who will be identified in the tender offer documents.
Item 9.01. Financial Statements and Exhibits
(a) Financial Statements of Businesses Acquired. Not applicable.
(b) Pro Forma Financial Information. Not applicable.
(c) Shell Company Transactions. Not applicable.
(d) Exhibits. Not applicable.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, hereunto duly authorized.
Greater Atlantic Financial Corp.
Date: September 1, 2009 By: /s/ Carroll E. Amos
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Carroll E. Amos
President and Chief Executive Officer