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Consolidated-Tomoka concludes strategic review with no sale

Consolidated-TomokaLand Co.'s board of directors concluded its review of strategic alternatives and has decided to proceedwith the company's existing business plan.

The review, conducted by a special committee of independent directors,in conjunction with Deutsche Bank Securities Inc. as financial adviser andPillsbury Winthrop Shaw Pittman LLP as legal counsel, reviewed other potentialalternatives, including a sale of the company as well as certain of its assets.

While numerous indications of interest were received from potentialacquirers, and more than 20 nondisclosure agreements were entered into, none ofthe expressions of interest the company received provided a "meaningful premium"for shareholders, according to a release. The company said it will continue discussionswith parties that have expressed interest in certain assets.

Under the current plan, the company intends to continue repurchasingstock under its 2015 share buyback plan; boost its annualized dividend by 100%,to 16 cents per share paid out on a quarterly basis from its previous distributionof 8 cents per share paid out on a semiannual basis; and monetize all or a portionof its remaining commercial loan portfolio, which totaled approximately $24 millionat June 30.

The company also intends to continue its program of monetizingits land and reinvesting the proceeds in single-tenant income properties throughtax-deferred exchanges. Based on the land deals expected to close over the nextyear, the company will resume its exploration of converting to a REIT, with theearliest possible conversion date of Jan. 1, 2018.

The company also said in announcing its second-quarter earningsthat it would make several changes to its corporate-governance and executive-compensationpolicies. The board will appoint two additional directors in 2016, which will temporarilyincrease the size of the board until after the company's 2017 annual shareholdersmeeting, at which it will only nominate seven directors, returning the board toits current size.

The company will also impose certain stock-ownership requirementson its CEO and board members and solicit shareholder feedback on an individual basison the negative say-on-pay vote that took place at the company's 2016 shareholdermeeting.

Earlier this year, activist investor Wintergreen Advisers LLCtook issue with the company's"flurry of transactions," accusing it of undermining Deutsche Bank's abilityto assist in the strategic review by interfering with its ability to identify companyassets. Wintergreen also successfully objectedto the company's plan to issue additional common stock upon the conversion its seniornotes. The firm's attempt to oust the existing board was unsuccessful, however.