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New York Community, Astoria reach MOU to settle merger-related lawsuits

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New York Community, Astoria reach MOU to settle merger-related lawsuits

Westbury, N.Y.-based NewYork Community Bancorp Inc. and Lake Success, N.Y.-based reached amemorandum of understanding on April 6 contemplating the settlement of six lawsuitschallenging their proposedmerger.

According to a Form 8-K filed April 8, the lawsuits, which wereconsolidated in January, allege that Astoria's directors breached their fiduciaryduty in agreeing to the deal's price, overlooking alleged conflicts of interest,agreeing to certain deal-protection devices and failing to disclose certain factsabout the process that led to the deal agreement.

The MOU contemplates the settlement of the suits with Astoriamaking supplemental disclosures related to the merger. The defendants, which includeboth companies and Astoria's directors, deny the allegations and believe no supplementaldisclosure is required, but they entered into the agreement "in order to avoidthe burden and expense of further litigation," the filing stated.