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In the news release, Notice of Filing Securities Class Action Against Orrstown Financial Services, Inc., Orrstown Bank, and Certain of Their Officers and Directors, issued
25-May-2012 by Chimicles & Tikellis LLP over PR Newswire, we are advised by the law firm that the fourth paragraph, last sentence, the date should read "
July 24, 2012" rather than "
July 25, 2012" as originally issued inadvertently. The complete, corrected release follows:
Notice of Filing Securities Class Action Against Orrstown Financial Services, Inc., Orrstown Bank, and Certain of Their Officers and Directors
May 25, 2012 /PRNewswire/ -- Chimicles & Tikellis LLP today announced that a securities class action lawsuit has been commenced in the United States District Court for the Middle District of
Pennsylvania on behalf of two classes of purchasers of Orrstown Financial Services, Inc. ("
Orrstown" or the "Company") (NASDAQ: ORRF): those who (1) purchased
Orrstown securities pursuant and/or traceable to the Company's Registration Statement and Prospectus (collectively "Offering Documents") issued in connection with its offering of common stock on
March 24, 2010 (the "March 2010 Offering"); and/or (2) purchased
Orrstown securities on the open market anytime between
March 24, 2010 and
October 27, 2011 (the "Class Period"). Defendants in this class action are
Orrstown, Orrstown Bank (the "Bank") for which
Orrstown is the holding company, and certain officers and directors of
Orrstown and the Bank, namely,
Anthony F. Ceddia,
Jeffrey W. Coy,
Mark K. Keller,
Thomas R. Quinn, Jr.,
Gregory A. Rosenberry,
Kenneth R. Shoemaker,
Glenn W. Snoke,
John S. Ward, and
Joel R. Zullinger (collectively "Defendants").
The action was brought against Defendants for violations of the Securities Act of 1933 and the Securities and Exchange Act of 1934. The complaint alleges that the Offering Documents for the
March 2010 Offering were negligently prepared and failed to disclose material information about
Orrstown's loan portfolio, underwriting practices, and internal controls. The complaint further alleges that
Orrstown knowingly and/or recklessly continued to make false and misleading statements after the
March 2010 Offering concerning the quality of
Orrstown's loan portfolio, internal controls and lending practices while simultaneously assuring the investing public about the quality of
Orrstown's management, underwriting procedures, and internal controls.
October 27, 2011,
Orrstown announced that the Federal Reserve Bank of
Philadelphia, one of the Bank's primary regulators, refused to authorize
Orrstown's requested declaration of quarterly dividends. The Federal Reserve took this step to prevent the Company from engaging in an unsafe and unsound banking practice which would further deplete the Company's capital base. In addition, the Company reported it had
$9.4 million of charge-offs in that quarter alone and that there were "decreases in asset quality ratios, including elevated levels of nonaccrual loans, restructured loans and delinquencies." The
October 27, 2011 disclosures, along with those made in
July 2011, revealed that the Bank's prior representations were false and misleading as the loan portfolio was severely impaired and its underwriting and management lead loan approval process was inadequate resulting in the outsourcing of its loan review process to an independent party. After these disclosures, the market corrected its valuation of
Orrstown such that the stock price plummeted indicating that Defendants' false assurances had caused
Orrstown to trade at artificially high prices throughout the Class Period.
Plaintiff seeks to recover damages on behalf of all Class members who purchased or otherwise acquired
Orrstown securities during the Class Period. If you purchased or otherwise acquired
Orrstown securities during the Class Period, and either lost money on the transaction or still hold the shares, you may wish to join in this action to serve as lead plaintiff. In order to do so, you must meet certain requirements set forth in the applicable law and file appropriate papers no later than
July 24, 2012.
A "lead plaintiff" is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the court must determine that the class member's claim is typical of the claims of other class members, and that the class member will adequately represent the class. Under certain circumstances, one or more class members may together serve as lead plaintiff. Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. You may retain Chimicles & Tikellis LLP, or other counsel of your choice, to serve as your counsel in this action.