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Exhibit
2
FSB
COMMUNITY BANKSHARES, INC.
STOCK
ISSUANCE PLAN
TABLE
OF CONTENTS
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1.
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Introduction
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1
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2.
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Definitions
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1
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3.
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Number
of Shares to be Offered
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6
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4.
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Independent
Valuation and Purchase Price of Shares
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6
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5.
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Method
of Offering Shares and Rights to Purchase Stock
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7
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6.
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Additional
Limitations on Purchases of Common Stock
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11
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7.
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Payment
for Stock
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14
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8.
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Manner
of Exercising Subscription Rights Through Order Forms
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15
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9.
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Undelivered,
Defective or Late Order Form; Insufficient Payment
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16
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10.
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Completion
of the Stock Offering
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17
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11.
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Market
for Common Stock
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17
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12.
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Stock
Purchases by Management Persons After the Stock Offering
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17
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13.
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Resales
of Stock by Directors and Officers
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17
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14.
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Stock
Certificates
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18
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15.
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Restriction
on Financing Stock Purchases
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18
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16.
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Stock
Benefit Plans
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18
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17.
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Post-Stock
Issuance Filing and Market Making
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18
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18.
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Payment
of Dividends and Repurchase of Stock
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18
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19.
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Stock
Offering Expenses
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19
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20.
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Employment
and Other Severance Agreements
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19
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21.
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Residents
of Foreign Countries and Certain States
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19
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22.
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Interpretation
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20
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23.
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Amendment
or
Termination of the Plan
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20
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This
Stock Issuance Plan (the “Plan”) provides for the offer and sale of up to 49.9%
of the Common Stock of FSB Community Bankshares, Inc., a federal corporation
(the “Holding Company”), in the Stock Offering. The Common Stock will be offered
on a priority basis to qualifying depositors, borrowers and the Tax-Qualified
Employee Plans of Fairport Savings Bank (the “Bank”), with any remaining shares
offered to the public in a Community Offering or a Syndicated Community
Offering, or a combination thereof. The Stock Offering will be conducted in
accordance with 12 C.F.R. Part 563g, Part 575 and to the extent applicable,
Form OC of the Regulations. Upon completion of the Stock Offering, FSB Community
Bankshares, MHC (the “MHC”) will continue to own at least a majority of the
Common Stock of the Holding Company.
As
used
in this Plan, the terms set forth below have the following
meanings:
Acting
in Concert:
The term
Acting in Concert means (i) knowing participation in a joint activity or
interdependent conscious parallel action towards a common goal whether or not
pursuant to an express agreement; or (ii) a combination or pooling of
voting or other interests in the securities of an issuer for a common purpose
pursuant to any contract, understanding, relationship, agreement or other
arrangement, whether written or otherwise. A Person or company which acts in
concert with another Person or company (“other party”) shall also be deemed to
be acting in concert with any Person or company who is also acting in concert
with that other party, except that any Tax-Qualified Employee Plan will not
be
deemed to be acting in concert with its trustee or a Person who serves in a
similar capacity solely for the purpose of determining whether stock held by
the
trustee and stock held by the plan will be aggregated.
Actual
Purchase Price:
The
price per share, determined as provided in this Plan, at which the Common Stock
will be sold in the Stock Offering.
Affiliate:
Any
Person that directly or indirectly, through one or more intermediaries,
controls, is controlled by, or is under common control with another
Person.
Application:
The
Application for Approval of a Minority Stock Issuance by a Subsidiary of a
Mutual Holding Company to be submitted by the Holding Company to the OTS in
connection with the Stock Offering.
Associate:
The term
“Associate,” when used to indicate a relationship with any Person, means:
(i) any corporation or organization (other than the Bank, the Holding
Company, the MHC or a majority-owned subsidiary of any thereof) of which such
Person is a senior officer or partner, or beneficially owns, directly or
indirectly, 10% or more of any class of equity securities of the corporation
or
organization; (ii) any trust or other estate, if the Person has a
substantial beneficial interest in the trust or estate or is a trustee or
fiduciary of the trust or estate. (For purposes of §§ 563b.370, 563b.380,
563b.385, 563b.390, 563b.395 and 563b.505 of the Regulations, a Person who
has a
substantial beneficial interest in a Tax-Qualified or Non-Tax Qualified Employee
Plan, or who is a trustee or a fiduciary of the plan, is not an Associate of
the
plan. For purposes of § 563b.370 of the Regulations, a Tax-Qualified
Employee Plan is not an Associate of a Person); (iii) any Person who is
related by blood or marriage to such Person and (a) who lives in the same
house as the Person, or (b) who is a director or senior officer of the Bank,
the
Holding Company, the MHC or a subsidiary thereof.
Bank:
Fairport
Savings Bank.
Capital
Stock:
Any and
all authorized stock of the Bank or the Holding Company.
Common
Stock:
Common
stock, par value $0.10 per share, issuable by the Holding Company in connection
with the Stock Offering, including securities convertible into Common Stock,
pursuant to its charter.
Community:
The
Counties of Livingston, Monroe, Ontario, Orleans and Wayne, State of New
York.
Community
Offering:
The
offering to certain members of the general public of any unsubscribed shares
in
the Subscription Offering. The Community Offering may include a Syndicated
Community Offering or public offering.
Control:
(including
the terms “controlling,” “controlled by” and “under common control with”) means
the direct or indirect power to direct or exercise a controlling influence
over
the management and policies of a person, whether through the ownership of voting
securities, by contract, or otherwise as described in Part 574 of the
Regulations.
Conversion
Transaction:
A
conversion of the MHC from the mutual to the stock form of
organization.
Deposit
Account(s):
Any
withdrawable account as defined in Section 561.42 of the Regulations, and
shall include all demand deposit accounts as defined in Section 561.16 of
the Regulations and certificates of deposit.
Effective
Date:
The date
upon which all necessary approvals have been obtained to complete the Stock
Offering, and the Stock Offering has been completed.
Eligible
Account Holder:
Any
person holding a Qualifying Deposit on the Eligibility Record Date for purposes
of determining subscription rights.
Eligibility
Record Date:
December
31, 2005, the date for determining who qualifies as an Eligible Account Holder
of the Bank.
Employee
Plans: The
Tax-Qualified and Non-Tax Qualified Employee Plans of the Bank and/or the
Holding Company.
ESOP:
The
Bank’s employee stock ownership plan and related trust.
Estimated
Valuation Range:
The
range of the estimated pro forma market value of the total number of shares
of
Common Stock to be issued by the Holding Company to the MHC and to Minority
Stockholders, as determined by the Independent Appraiser prior to the
Subscription Offering and as it may be amended from time to time
thereafter.
Exchange
Act:
The
Securities Exchange Act of 1934, as amended.
FDIC:
The
Federal Deposit Insurance Corporation.
HOLA:
The Home
Owners’ Loan Act, as amended.
Holding
Company:
FSB
Community Bankshares, Inc., the federal corporation which will be majority-owned
by the MHC after the completion of the Stock Offering and which will own 100%
of
the common stock of the Bank, and any successor to such corporation that may
be
established in connection with the Stock Offering or a Conversion
Transaction.
Independent
Appraiser:
The
appraiser retained by the Holding Company and the Bank to prepare an appraisal
of the pro forma market value of the Bank and the Holding Company.
Independent
Valuation: The
aggregate consolidated pro forma market value of the Holding Company and the
Bank, giving effect to the Stock Offering.
Management
Person:
Any
Officer or director of the Bank or any Affiliate of the Bank, and any person
Acting in Concert with any such Officer or director.
Market
Maker:
A dealer
(i.e.,
any
person who engages directly or indirectly as agent, broker, or principal in
the
business of offering, buying, selling or otherwise dealing or trading in
securities issued by another person) who, with respect to a particular security,
(1) regularly publishes bona
fide
competitive bid and offer quotations on request, and (2) is ready, willing
and able to effect transactions in reasonable quantities at the dealer’s quoted
prices with other brokers or dealers.
MHC:
FSB
Community Bankshares, MHC, the mutual holding company of the Holding
Company.
Minority
Ownership Interest:
The
shares of the Common Stock owned by persons other than the MHC, expressed as
a
percentage of the total shares of Common Stock outstanding.
Minority
Stockholder:
Any
owner of the Common Stock, other than the MHC.
Non-Voting
Stock:
Any
Capital Stock other than Voting Stock.
Offering
Range:
The
aggregate purchase price of the Common Stock to be sold in the Stock Offering
based on the Independent Valuation expressed as a range, which may vary within
15% above or 15% below the midpoint of such range, with a possible adjustment
by
up to 15% above the maximum of such range. The Offering Range will be based
on
the Estimated Valuation Range, but will represent a Minority Ownership Interest
equal to up to 49.9% of the Common Stock.
Officer:
An
executive officer of the Holding Company or the Bank, including the Chief
Executive Officer, President, Executive or Senior Vice Presidents in charge
of
principal business functions, Secretary, Treasurer and any other person
performing similar functions.
Order
Form:
Any form
(together with any attached cover letter and/or certifications or
acknowledgements), sent by the Holding Company to any Person containing among
other things a description of the alternatives available to such Person under
the Plan and by which any such Person may make elections regarding purchases
of
Common Stock in the Subscription and Community Offerings.
Other
Member: Any
Person, other than an Eligible Account Holder or a Supplemental Eligible Account
Holder, holding a Qualifying Deposit on the Other Member Record Date and any
borrower from the Bank as of January 14, 2005 who continues to maintain such
borrowings as of the Other Member Record Date.
Other
Member Record Date:
The last
day of the month immediately preceding the month in which OTS approval of the
Stock Offering is obtained.
OTS:
The
Office of Thrift Supervision, and any successor thereto.
Person:
An
individual, corporation, partnership, association, joint-stock company, limited
liability company, trust, unincorporated organization, or a government or
political subdivision of a government.
Plan:
This FSB
Community Bankshares, Inc. Stock Issuance Plan.
Qualifying
Deposit:
The
aggregate balance of each Deposit Account of an Eligible Account Holder as
of
the close of business on the Eligibility Record Date, or of a Supplemental
Eligible Account Holder as of the close of business on the Supplemental
Eligibility Record Date, or of an Other Member as of the close of business
on
the Other Member Record Date, as the case may be, provided such aggregate
balance is not less than $50.
Regulations:
The
rules and regulations of the OTS, including the OTS rules and regulations
regarding mutual holding companies.
Reorganization:
The 2005
reorganization of the Bank into the mutual holding company
structure.
Resident:
The
terms “resident,” “residence,” “reside,” “resided” or “residing” as used herein
with respect to any person shall mean any person who occupied a dwelling within
the Bank’s Community, has an intent to remain with the Community for a period of
time, and manifests the genuineness of that intent by establishing an ongoing
physical presence within the Community together with an indication that such
presence within the Community is something other than merely transitory in
nature. To the extent the Person is a corporation or other business entity,
the
principal place of business or headquarters shall be in the Community. To the
extent a person is a personal benefit plan, the circumstances of the beneficiary
shall apply with respect to this definition. In the case of all other benefit
plans, the circumstances of the trustee shall be examined for purposes of this
definition. The Bank may utilize deposit or loan records or such other evidence
provided to it to make a determination as to whether a person is a resident.
In
all cases, however, such a determination shall be in the sole discretion of
the
Holding Company and the Bank.
SEC:
The
Securities and Exchange Commission.
Stock
Offering:
The
offering of Common Stock to persons other than the MHC, in a Subscription
Offering and, to the extent shares remain available, in a Community Offering
or
a Syndicated Community Offering.
Subscription
Offering:
The
offering of Common Stock for subscription and purchase pursuant to
Section 5.A
of this
Plan.
Supplemental
Eligible Account Holder:
Any
Person holding a Qualifying Deposit on the Supplemental Eligibility Record
Date,
who is not an Eligible Account Holder, a Tax-Qualified Employee Plan or an
Officer or director of the Bank.
Supplemental
Eligibility Record Date:
The last
day of the calendar quarter preceding approval of the Plan by the
OTS.
Syndicated
Community Offering:
The
offering of Common Stock following or contemporaneously with the Community
Offering through a syndicate of broker-dealers.
Tax-Qualified
Employee Plan:
Any
defined benefit plan or defined contribution plan (including any employee stock
ownership plan, stock bonus plan, profit-sharing plan, or other plan) of the
Bank, the Holding Company, the MHC or any of their affiliates, which, with
its
related trusts, meets the requirements to be qualified under Section 401 of
the Internal Revenue Code. The term “Non-Tax-Qualified Employee Plan” means any
stock benefit plan of the Bank, the Holding Company, the MHC or any of their
affiliates which is not so qualified under Section 401 of the Internal
Revenue Code.
Voting
Stock:
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(1)
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Voting
Stock means common stock or preferred stock, or similar interests
if the
shares by statute, charter or in any manner, entitle the
holder:
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(i)
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To
vote for or to select directors of the Bank or the Holding Company;
and
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(ii)
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To
vote on or to direct the conduct of the operations or other significant
policies of the Bank or the Holding
Company.
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(2)
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Notwithstanding
anything in paragraph (1) above, preferred stock is not “Voting
Stock” if:
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(i)
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Voting
rights associated with the preferred stock are limited solely to
the type
customarily provided by statute with regard to matters that would
significantly and adversely affect the rights or preferences of the
preferred stock, such as the issuance of additional amounts or classes
of
senior securities, the modification of the terms of the preferred
stock,
the dissolution of the Bank, or the payment of dividends by the Bank
when
preferred dividends are in arrears;
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(ii)
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The
preferred stock represents an essentially passive investment or financing
device and does not otherwise provide the holder with control over
the
issuer; and
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(iii)
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The
preferred stock does not at the time entitle the holder, by statute,
charter, or otherwise, to select or to vote for the selection of
directors
of the Bank or the Holding Company.
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(3)
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Notwithstanding
anything in paragraphs (1) and (2) above, “Voting Stock” shall be
deemed to include preferred stock and other securities that, upon
transfer
or otherwise, are convertible into Voting Stock or exercisable to
acquire
Voting Stock where the holder of the stock, convertible security
or right
to acquire Voting Stock has the preponderant economic risk in the
underlying Voting Stock. Securities immediately convertible into
Voting
Stock at the option of the holder without payment of additional
consideration shall be deemed to constitute the Voting Stock into
which
they are convertible; other convertible securities and rights to
acquire
Voting Stock shall not be deemed to vest the holder with the preponderant
economic risk in the underlying Voting Stock if the holder has paid
less
than 50% of the consideration required to directly acquire the Voting
Stock and has no other economic interest in the underlying Voting
Stock.
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3.
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Number
of Shares to be Offered
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The
total
number of shares (or range thereof) of Common Stock to be issued and offered
for
sale pursuant to the Plan shall be determined initially by the Board of
Directors of the Holding Company in conjunction with the determination of the
Independent Appraiser. The number of shares to be offered may be adjusted prior
to completion of the Stock Offering. The total number of shares of Common Stock
that may be issued to persons other than the MHC at the close of the Stock
Offering must be less than 50% of the issued and outstanding shares of Common
Stock.
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4.
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Independent
Valuation and Purchase Price of
Shares
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All
shares of Common Stock sold in the Stock Offering shall be sold at a uniform
price per share. The Actual Purchase Price and number of shares to be
outstanding shall be determined by the Board of Directors of the Holding Company
on the basis of the estimated pro forma market value of the Holding Company
and
the Bank. The aggregate purchase price for the Common Stock will not be
inconsistent with such market value of the Holding Company and the Bank. The
pro
forma market value of the Holding Company and the Bank will be determined for
such purposes by the Independent Appraiser.
Prior
to
the commencement of the Stock Offering, an Estimated Valuation Range will be
established, which range may vary within 15% above to 15% below the midpoint
of
such range, and up to 15% greater than the maximum of such range, as determined
by the Board of Directors at the time of the Stock Offering and consistent
with
OTS regulations. The Holding Company intends to issue up to 49.9% of its Common
Stock in the Stock Offering. The number of shares of Common Stock to be issued
and the ownership interest of the MHC may be increased or decreased by the
Holding Company, taking into consideration any change in the independent
valuation and other factors, at the discretion of the Board of Directors of
the
Holding Company.
Based
upon the Independent Valuation as updated prior to the commencement of the
Stock
Offering, the Board of Directors may establish the minimum and maximum
percentage of shares of Common Stock that will be offered for sale in the Stock
Offering, or it may fix the percentage of shares that will be offered for sale
in the Stock Offering. In the event the percentage of the shares offered for
sale in the Stock Offering is not fixed in the Stock Offering, the Minority
Ownership Interest resulting from the Stock Offering will be determined as
follows: (a) the product of (x) the total number of shares of Common Stock
sold by the Holding Company and (y) the purchase price per share, divided by
(b) the aggregate pro forma market value of the Bank and the Holding
Company upon the closing of the Stock Offering and sale of all the Common
Stock.
Notwithstanding
the foregoing, no sale of Common Stock may be consummated unless, prior to
such
consummation, the Independent Appraiser confirms to the Holding Company, the
Bank and to the OTS that, to the best knowledge of the Independent Appraiser,
nothing of a material nature has occurred which, taking into account all
relevant factors, would cause the Independent Appraiser to conclude that the
aggregate value of the Common Stock sold in the Stock Offering at the Actual
Purchase Price is incompatible with the Independent Valuation. If such
confirmation is not received, the Holding Company may cancel the Stock Offering,
extend the Stock Offering and establish a new price range and/or estimated
price
range, extend, reopen or hold a new Stock Offering or take such other action
as
the OTS may permit.
The
estimated market value of the Holding Company and the Bank shall be determined
for such purpose by an Independent Appraiser on the basis of such appropriate
factors as are not inconsistent with OTS regulations. The Common Stock to be
issued in the Stock Offering shall be fully paid and
non-assessable.
If
there
is a Community Offering or Syndicated Community Offering of shares of Common
Stock not subscribed for in the Subscription Offering, the price per share
at
which the Common Stock is sold in such Community Offering or Syndicated
Community Offering shall be the Actual Purchase Price, which will be equal
to
the purchase price per share at which the Common Stock is sold to persons in
the
Subscription Offering. Shares sold in the Community Offering or Syndicated
Community Offering will be subject to the same limitations as shares sold in
the
Subscription Offering.
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5.
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Method
of Offering Shares and Rights to Purchase
Stock
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In
descending order of priority, the opportunity to purchase Common Stock shall
be
given in the Subscription Offering to: (1) Eligible Account Holders;
(2) Tax-Qualified Employee Plans; (3) Supplemental Eligible Account
Holders; and (4) Other Members. Any shares of Common Stock that are not
subscribed for in the Subscription Offering may at the discretion of the Holding
Company be offered for sale in a Community Offering or a Syndicated Community
Offering. The minimum purchase by any Person shall be 25 shares. The Holding
Company shall determine in its sole discretion whether each prospective
purchaser is a “Resident,” “Associate,” or “Acting in Concert” as defined in the
Plan, and shall interpret all other provisions of the Plan in its sole
discretion. All such determinations are in the sole discretion of the Holding
Company, and may be based on whatever evidence the Holding Company chooses
to
use in making any such determination.
In
addition to the priorities set forth below, the Board of Directors may establish
other priorities for the purchase of Common Stock, subject to the approval
of
the OTS. The priorities for the purchase of shares in the Stock Offering are
as
follows:
Priority
1: Eligible Account Holders.
Each
Eligible Account Holder shall receive non-transferable subscription rights
to
subscribe for shares of Common Stock offered in the Stock Offering in an
amount
equal to the greater of $150,000, one-tenth of one percent (0.1%) of the
total
shares offered in the Stock Offering, or 15 times the product (rounded down
to
the nearest whole number) obtained by multiplying the total number of shares
of
Common Stock to be issued in the Stock Offering by a fraction, of which the
numerator is the Qualifying Deposit of the Eligible Account Holder and the
denominator is the total amount of Qualifying Deposits of all Eligible Account
Holders, in each case on the Eligibility Record Date and subject to the
provisions of Section 6;
provided
that the
Holding Company may, in its sole discretion and without further notice to
or
solicitation of subscribers or other prospective purchasers, increase such
maximum purchase limitation to 5% of the maximum number of shares offered
in the
Stock Offering or decrease such maximum purchase limitation to 0.1% of the
maximum number of shares offered in the Stock Offering, subject to the overall
purchase limitations set forth in Section 6.
If
there are insufficient shares available to satisfy all subscriptions of Eligible
Account Holders, shares will be allocated to Eligible Account Holders so
as to
permit each such subscribing Eligible Account Holder to purchase a number
of
shares sufficient to make his or her total allocation equal to the lesser
of 100
shares or the number of shares for which such person has subscribed. Thereafter,
unallocated shares will be allocated pro rata to remaining subscribing Eligible
Account Holders whose subscriptions remain unfilled in the same proportion
that
each such subscriber’s Qualifying Deposit bears to the total amount of
Qualifying Deposits of all subscribing Eligible Account Holders whose
subscriptions remain unfilled. To ensure proper allocation of stock, each
Eligible Account Holder must list on his or her subscription order form all
accounts in which he or she had an ownership interest as of the Eligibility
Record Date. Officers, directors and their Associates may be Eligible Account
Holders. However, if an officer, director, or his or her Associate receives
subscription rights based on increased deposits in the year before the
Eligibility Record Date, subscription rights based upon these deposits are
subordinate to the subscription rights of other Eligible Account Holders.
Priority
2: Tax-Qualified Employee Plans.
The
Tax-Qualified Employee Plans shall be given the opportunity to purchase in
the
aggregate up to 4.9% of the shares of Common Stock to be outstanding immediately
following the completion of the Stock Offering. In the event of an
oversubscription in the Stock Offering, subscriptions for shares by the
Tax-Qualified Employee Plans may be satisfied, in whole or in part, out of
authorized but unissued shares of the Holding Company subject to the maximum
purchase limitations applicable to such plans as set forth in
Section 6,
or may
be satisfied, in whole or in part, through open market purchases by the
Tax-Qualified Employee Plans subsequent to the closing of the Stock Offering.
If
the final valuation exceeds the maximum of the Offering Range, up to 4.9% of
the
shares of Common Stock to be outstanding immediately following the completion
of
the Stock Offering may be sold to the Tax-Qualified Employee Plans
notwithstanding any oversubscription by Eligible Account Holders.
Priority
3: Supplemental Eligible Account Holders.
To the
extent there are sufficient shares remaining after satisfaction of subscriptions
by Eligible Account Holders, and the Tax-Qualified Employee Plans, each
Supplemental Eligible Account Holder shall receive non-transferable subscription
rights to subscribe for shares of Common Stock offered in the Stock Offering
in
an amount equal to the greater of $150,000, one-tenth of one percent (0.1%)
of
the total shares offered in the Stock Offering, or 15 times the product (rounded
down to the nearest whole number) obtained by multiplying the total number
of
shares of Common Stock to be issued in the Stock Offering by a fraction,
of
which the numerator is the Qualifying Deposit of the Supplemental Eligible
Account Holder and the denominator is the total amount of Qualifying Deposits
of
all Supplemental Eligible Account Holders, in each case on the Supplemental
Eligibility Record Date and subject to the provisions of
Section 6;
provided
that the
Holding Company may, in its sole discretion and without further notice to
or
solicitation of subscribers or other prospective purchasers, increase such
maximum purchase limitation to 5% of the maximum number of shares offered
in the
Stock Offering or decrease such maximum purchase limitation to 0.1% of the
maximum number of shares offered in the Stock Offering, subject to the overall
purchase limitations set forth in Section 6.
In the
event Supplemental Eligible Account Holders subscribe for a number of shares
which, when added to the shares subscribed for by Eligible Account Holders
and
the Tax-Qualified Employee Plans, is in excess of the total shares offered
in
the Stock Offering, the subscriptions of Supplemental Eligible Account Holders
will be allocated among subscribing Supplemental Eligible Account Holders
so as
to permit each subscribing Supplemental Eligible Account Holder to purchase
a
number of shares sufficient to make his or her total allocation equal to
the
lesser of 100 shares or the number of shares for which such person has
subscribed. Thereafter, unallocated shares will be allocated to each subscribing
Supplemental Eligible Account Holder whose subscription remains unfilled
in the
same proportion that such subscriber’s Qualifying Deposits on the Supplemental
Eligibility Record Date bear to the total amount of Qualifying Deposits of
all
subscribing Supplemental Eligible Account Holders whose subscriptions remain
unfilled.
Priority
4: Other Members.
To the
extent there are sufficient shares remaining after satisfaction of subscriptions
by Eligible Account Holders, the Tax-Qualified Employee Plans, and Supplemental
Eligible Account Holders, each Other Member shall receive non-transferable
subscription rights to subscribe for shares of Common Stock offered in the
Stock
Offering in an amount equal to the greater of $150,000, one-tenth of one
percent
(0.1%) of the total shares offered in the Stock Offering, or 15 times the
product (rounded down to the nearest whole number) obtained by multiplying
the
total number of shares of Common Stock to be issued in the Stock Offering
by a
fraction, of which the numerator is the Qualifying Deposit of the Other Member
who is a depositor of the Bank and the denominator is the total amount of
Qualifying Deposits of all Other Members who are depositors of the Bank,
in each
case on the Other Member Record Date and subject to the provisions of
Section 6;
provided
that the
Holding Company may, in its sole discretion and without further notice to
or
solicitation of subscribers or other prospective purchasers, increase such
maximum purchase limitation to 5% of the maximum number of shares offered
in the
Stock Offering or decrease such maximum purchase limitation to 0.1% of the
maximum number of shares offered in the Stock Offering, subject to the overall
purchase limitations set forth in Section 6.
In the
event Other Members subscribe for a number of shares which, when added to
the
shares subscribed for by Eligible Account Holders,
the
Tax-Qualified Employee Plans, and Supplemental Eligible Account Holders, is
in
excess of the total shares offered in the Stock Offering, the subscriptions
of
Other Members will be allocated among subscribing Other Members so as to permit
each subscribing Other Member to purchase a number of shares sufficient to
make
his or her total allocation equal to the lesser of 100 shares or the number
of
shares for which such person has subscribed. Thereafter, unallocated shares
will
be allocated to each subscribing Other Member whose subscription remains
unfilled in the proportion that the amounts of their subscription bears to
the
total amount of subscriptions of all subscribing Other Members whose
subscriptions remain unfilled.
Any
shares of Common Stock not subscribed for in the Subscription Offering may
be
offered for sale in a Community Offering. This will involve an offering of
all
unsubscribed shares directly to the general public with a preference to those
natural persons residing in the Community. The Community Offering, if any,
shall
be for a period of not more than 45 days unless extended by the Holding Company
and the Bank, and shall commence concurrently with, during or promptly after
the
Subscription Offering. The Holding Company and the Bank may use one or more
investment banking firms on a best efforts basis to sell the unsubscribed
shares
in the Subscription and Community Offering. The Holding Company and the Bank
may
pay a commission or other fee to such investment banking firm(s) as to the
shares sold by such firm(s) in the Subscription and Community Offering and
may
also reimburse such firm(s) for expenses incurred in connection with the
sale.
The Community Offering may include a Syndicated Community Offering managed
by
such investment banking firm(s). The Common Stock will be offered and sold
in
the Community Offering, in accordance with OTS regulations, so as to achieve
a
widespread distribution of the Common Stock. No Person may purchase more
than
$150,000 of Common Stock in the Community Offering, subject to the overall
purchase limitations set forth in Section 6.
In the
event orders for Common Stock in the Community Offering exceed the number
of
shares available for sale, shares will be allocated (to the extent shares
remain
available) first to cover orders of natural persons residing in the Community,
and thereafter to cover orders of other members of the general public, so
that
each Person in such category of the Community Offering may receive 1,000
shares
and thereafter, remaining shares will be allocated on an equal number of
shares
basis per order in the category until all orders within the category are
filled.
The
Holding Company, in its sole discretion, may reject subscriptions, in whole
or
in part, received from any Person under this Section 5.B.
| |
C.
|
Syndicated
Community Offering
|
Any
shares of Common Stock not sold in the Subscription Offering or in the Community
Offering, if any, may be offered for sale to the general public by a selling
group of broker-dealers in a Syndicated Community Offering, subject to terms,
conditions and procedures, including the timing of the offering, as may be
determined by the Holding Company in a manner that is intended to achieve
a
widespread distribution of the Common Stock subject to the rights of the
Holding
Company to accept or reject in whole or in part all orders in the Syndicated
Community Offering. It is expected that the Syndicated Community Offering
would
commence as soon as practicable after termination of the Subscription Offering
and the Community Offering, if any. The Syndicated Community Offering shall
be
completed within 45 days after the termination of the Subscription Offering,
unless such period is extended as provided herein. No Person may purchase
more
than $150,000 of Common Stock in the Syndicated Community Offering, subject
to
the overall purchase limitations set forth in Section 6.
If
for
any reason a Syndicated Community Offering of unsubscribed shares of Common
Stock cannot be effected and any shares remain unsold after the Subscription
Offering and the Community Offering, if any, the Board of Directors of the
Holding Company will seek to make other arrangements for the sale of the
remaining shares. Such other arrangements will be subject to the approval of
the
OTS and to compliance with applicable securities laws.
|
6.
|
Additional
Limitations on Purchases of Common
Stock
|
Purchases
of Common Stock in the Stock Offering will be subject to the following purchase
limitations:
| |
A.
|
The
aggregate amount of outstanding Common Stock owned or controlled
by
persons other than the MHC at the close of the Stock Offering shall
be
less than 50% of the Holding Company’s total outstanding Common
Stock.
|
| |
B.
|
The
maximum purchase of Common Stock in the Subscription Offering by
a Person,
or group of Persons through one or more individual and/or joint
Deposit
Accounts, is $150,000. The maximum purchase of Common Stock in the
Subscription Offering by a group of Persons through a single Deposit
Account is $150,000. No Person by himself, or with an Associate
or group
of Persons Acting in Concert, may purchase more than $200,000 of
the
Common Stock offered in the Stock Offering, except that: (i) the
Holding Company may, in its sole discretion and without further
notice to,
or solicitation of, subscribers or other prospective purchasers,
increase
such maximum purchase limitation to 5% of the number of shares
offered in
the Stock Offering; (ii) the Tax-Qualified Employee Plans may purchase
up
to 4.9% of the shares of Common Stock to be outstanding immediately
following the completion of the Stock Offering; and (iii) for
purposes of this subsection 6.B
shares to be held by any Tax-Qualified Employee Plan and attributable
to a
person shall not be aggregated with other shares purchased directly
by or
otherwise attributable to such
person.
|
| |
C.
|
The
aggregate amount of Common Stock acquired in the Stock Offering,
plus all
prior issuances by the Holding Company, by any Non-Tax-Qualified
Employee
Plan or any Management Person and his or her Associates, exclusive
of any
shares of Common Stock acquired by such plan or Management Person
and his
or her Associates in the secondary market, shall not exceed 4.9%
of the
outstanding shares of Common Stock at the conclusion of the Stock
Offering. In calculating the number of shares held by any Management
Person and his or her Associates under this paragraph, shares held
by any
Tax-Qualified Employee Plan or Non-Tax-Qualified Employee Plan of
the
Holding Company or the Bank that are attributable to such Person
shall not
be counted.
|
| |
D.
|
The
aggregate amount of Common Stock acquired in the Stock Offering,
plus all
prior issuances by the Holding Company, by any Non-Tax-Qualified
Employee
Plan or any Management Person and his or her Associates, exclusive
of any
Common Stock acquired by such plan or Management Person and his or
her
Associates in the secondary market, shall not exceed 4.9% of the
stockholders’ equity of the Holding Company at the conclusion of the Stock
Offering. In calculating the number of shares held by any Management
Person and his or her Associates under this paragraph, shares held
by any
Tax-Qualified Employee Plan or Non-Tax-Qualified Employee Plan of
the
Holding Company or the Bank that are attributable to such Person
shall not
be counted.
|
| |
E.
|
The
aggregate amount of Common Stock acquired in the Stock Offering,
plus all
prior issuances by the Holding Company, by any one or more Tax-Qualified
Employee Plans, exclusive of any shares of Common Stock acquired
by such
plans in the secondary market, shall not exceed 4.9% of the outstanding
shares of Common Stock at the conclusion of the Stock
Offering.
|
| |
F.
|
The
aggregate amount of Common Stock acquired in the Stock Offering,
plus all
prior issuances by the Holding Company, by any one or more Tax-Qualified
Employee Plans, exclusive of any shares of Common Stock acquired
by such
plans in the secondary market, shall not exceed 4.9% of the stockholders’
equity of the Holding Company at the conclusion of the Stock
Offering.
|
| |
G.
|
The
aggregate amount of Common Stock acquired in the Stock Offering,
plus all
prior issuances by the Holding Company, by all stock benefit plans
of the
Holding Company or the Bank, other than employee stock ownership
plans,
shall not exceed 25% of the outstanding Common Stock held by persons
other
than the MHC.
|
| |
H.
|
The
aggregate amount of Common Stock acquired in the Stock Offering,
plus all
prior issuances by the Holding Company, by all Non-Tax-Qualified
Employee
Plans, Management Persons and their Associates, exclusive of any
Common
Stock acquired by such plans, Management Persons and their Associates
in
the secondary market, shall not exceed 32% of the outstanding shares
of
Common Stock held by persons other than the MHC at the conclusion
of the
Stock Offering. In calculating the number of shares held by Management
Persons and their Associates under this paragraph or paragraph I.
below, shares held by any Tax-Qualified Employee Plan or Non-Tax-Qualified
Employee Plan that are attributable to such persons shall not be
counted.
|
| |
I.
|
The
aggregate amount of Common Stock acquired in the Stock Offering,
plus all
prior issuances by the Holding Company, by all Non-Tax-Qualified
Employee
Plans, Management Persons and their Associates, exclusive of any
Common
Stock acquired by such plans, Management Persons and their Associates
in
the secondary market, shall not exceed 32% of the stockholders’ equity of
the Holding Company held by persons other than the MHC at the conclusion
of the Stock Offering.
|
| |
J.
|
Notwithstanding
any other provision of this Plan, no Person shall be entitled to
purchase
any Common Stock to the extent such purchase would be illegal under
any
federal law or state law or regulation or would violate regulations
or
policies of the National Association of Securities Dealers, Inc.,
particularly those regarding free riding and withholding. The Holding
Company and/or its agents may ask for an acceptable legal opinion
from any
purchaser as to the legality of such purchase and may refuse to honor
any
purchase order if such opinion is not timely
furnished.
|
| |
K.
|
The
Board of Directors of the Holding Company has the right in its sole
discretion to reject any order submitted by a person whose representations
the Board of Directors believes to be false or who it otherwise believes,
either alone or acting in concert with others, is violating,
circumventing, or intends to violate, evade or circumvent the terms
and
conditions of this Plan.
|
| |
L.
|
A
minimum of 25 shares of Common Stock must be purchased by each Person
purchasing shares in the Stock Offering to the extent those shares
are
available; provided, however, that in the event the minimum number
of
shares of Common Stock purchased times the price per share exceeds
$500,
then such minimum purchase requirement shall be reduced to such number
of
shares which when multiplied by the price per share shall not exceed
$500,
as determined by the Board.
|
Non-exclusive
examples of the applicability of the purchase limitations set forth in this
Section 6 include, but are not limited to, the following
| |
(i)
|
Depositor
A has multiple Deposit Accounts, each of which is registered in
his own
name. No Associate of or individual otherwise Acting in Concert
with
Depositor A is purchasing Common Stock in the Subscription Offering.
Depositor A can purchase a maximum of $150,000 of Common Stock
in the
Subscription Officering.
|
| |
(ii)
|
Depositor
B has one Deposit Account registered in her own name. Depositor
B has
another Deposit Account that is held jointly with Depositor C (either
as
an “and” account, an “or” account, or in any other form of joint account).
No other Associate of or individual otherwise Acting in Concert
with
either of Depositor B or Depositor C is purchasing Common Stock
in the
Subscription Offering. Generally, no more than a total of $1500,000
of
Common Stock may be ordered in the Subscription Offering through
the
ownership of these two Deposit Accounts. However, if Depositor
C purchased
$150,000 of Common Stock through an IRA or other type of account
as
permitted by Section 8, then Depositor B could also purchase a
maximum of
$150,000 of Common Stock in the Subscription Offering.
|
| |
(iii)
|
Depositor
D and Depositor E have multiple joint accounts with each other
that are
all titled in the same manner. No other Associate or individual
otherwise
Acting in Concert with either of Depositor D or Depositor E is
purchasing
Common Stock in the Subscription Offering. No more than a total
of
$1500,000 of Common Stock may be ordered in the Subscription Offering
through the ownership of these Deposit Accounts, regardless of
whether
Depositor D or Depositor E purchases Common Stock through an IRA
or other
type of account as permitted by
Section 8.
|
| |
(iv)
|
Depositor
F has one deposit account registered in his own name. Depositor
G, who is
Depositor F’s spouse, has one deposit account registered in her own name.
No other Associate of or individual otherwise Acting in Concert
with
either of Depositor F or Depositor G is purchasing Common Stock
in the
Subscription Offering. The maximum combined amount of Common Stock
that
may be purchased by Depositor F and Depositor G through the ownership
of
these two deposit accounts is a total of
$200,000.
|
Subscription
rights afforded under this Plan and by OTS regulations are non-transferable.
No
person may transfer, offer to transfer, or enter into any agreement or
understanding to transfer, the legal or beneficial ownership of any subscription
rights under this Plan. No person may transfer, offer to transfer or enter
into
an agreement or understanding to transfer legal or beneficial ownership of
any
shares of Common Stock except pursuant to this Plan.
EACH
PERSON PURCHASING COMMON STOCK IN THE STOCK OFFERING WILL BE DEEMED TO CONFIRM
THAT SUCH PURCHASE DOES NOT CONFLICT WITH THE PURCHASE LIMITATIONS IN THIS
PLAN.
ALL QUESTIONS CONCERNING WHETHER ANY PERSONS ARE ASSOCIATES OR A GROUP ACTING
IN
CONCERT OR WHETHER ANY PURCHASE CONFLICTS WITH THE PURCHASE LIMITATIONS IN
THIS
PLAN OR OTHERWISE VIOLATES ANY PROVISION OF THIS PLAN SHALL BE DETERMINED BY
THE
HOLDING COMPANY IN ITS SOLE DISCRETION. SUCH DETERMINATION SHALL BE CONCLUSIVE,
FINAL AND BINDING ON ALL PERSONS, AND THE HOLDING COMPANY AND THE BANK MAY
TAKE
ANY REMEDIAL ACTION INCLUDING, WITHOUT LIMITATION, REJECTING THE PURCHASE OR
REFERRING THE MATTER TO THE OTS FOR ACTION, AS THE HOLDING COMPANY MAY IN ITS
SOLE DISCRETION DEEM APPROPRIATE.
All
payments for Common Stock subscribed for or ordered in the Stock Offering must
be delivered in full to the Holding Company, together with a properly completed
and executed order form, or purchase order in the case of the Syndicated
Community Offering, on or prior to the expiration date specified on the order
form or purchase order, as the case may be, unless such date is extended by
the
Holding Company; provided,
that
if
the Employee Plans subscribe for shares of Common Stock during the Subscription
Offering, such plans may pay for such shares at the Actual Purchase Price upon
consummation of the Stock Offering. The Holding Company or the Bank may make
scheduled discretionary contributions to the ESOP provided such contributions
from the Bank, if any, do not cause the Bank to fail to meet its regulatory
capital requirement.
Payment
for Common Stock shall be made either by check or money order, or if a purchaser
has a Deposit Account in the Bank, such purchaser may pay for the shares
subscribed for by authorizing the Bank to make a withdrawal from the purchaser’s
Deposit Account at the Bank in an amount equal to the purchase price of such
shares. Such authorized withdrawal, whether from a savings passbook or
certificate account, shall be without penalty as to premature withdrawal. If
the
authorized withdrawal is from a certificate account, and the remaining balance
does not meet the applicable minimum balance requirements, the certificate
shall
be canceled at the time of withdrawal, without penalty, and the remaining
balance will earn interest at the Bank’s passbook rate. Funds for which a
withdrawal is authorized will remain in the purchaser’s Deposit Account but may
not be used by the purchaser until the Common Stock has been sold or a 90-day
period (or such longer period as may be approved by the OTS) following the
effective date of the Prospectus has expired, whichever occurs first.
Thereafter, the withdrawal will be given effect only to the extent necessary
to
satisfy the subscription (to the extent it can be filled) at the Actual Purchase
Price per share. Interest will continue to be earned on any amounts authorized
for withdrawal until such withdrawal is given effect. The Bank or the Holding
Company will pay interest, at a rate no less than the Bank’s passbook rate, for
all amounts paid by check or money order to purchase Common Stock. Such interest
will be earned from the date payment is received by the Bank or the Holding
Company until consummation or termination of the Stock Offering. If for any
reason the Stock Offering is not consummated, all payments made by subscribers
in the Stock Offering will be refunded to them with interest. In case of amounts
authorized for withdrawal from Deposit Accounts, refunds will be made by
canceling the authorization for withdrawal.
|
8.
|
Manner
of Exercising Subscription Rights Through Order
Forms
|
As
soon
as practicable after the prospectus prepared by the Holding Company has been
declared effective by the SEC and authorized for use by the OTS, copies of
the
prospectus and order forms will be distributed to all Eligible Account Holders,
the Tax-Qualified Employee Plans, Supplemental Eligible Account Holders and
Other Members at their last known addresses appearing on the records of the
Bank
for the purpose of subscribing for shares of Common Stock in the Subscription
Offering.
Each
order form will be preceded or accompanied by the prospectus describing the
Holding Company, the Bank, the Common Stock and the Subscription and Community
Offerings. Each order form will contain, among other things, the
following:
| |
A.
|
A
specified date by which all order forms must be received by the Holding
Company or the Bank, which date shall be not less than 20 days, nor
more
than 45 days, following the date on which the order forms are mailed
by
the Holding Company or the Bank, and which date will constitute the
termination of the Subscription
Offering;
|
| |
B.
|
The
Actual Purchase Price;
|
| |
C.
|
A
description of the minimum and maximum number of shares of Common
Stock
that may be subscribed for pursuant to the exercise of Subscription
Rights
or otherwise purchased in the Community
Offering;
|
| |
D.
|
Instructions
as to how the recipient of the order form must indicate thereon the
number
of shares of Common Stock for which such Person elects to subscribe
and
the available alternative methods of payment
therefor;
|
| |
E.
|
An
acknowledgment that the recipient of the order form has received
a final
copy of the prospectus prior to execution of the order
form;
|
| |
F.
|
A
statement indicating the consequences of failing to properly complete
and
return the order form, including a statement to the effect that all
subscription rights are nontransferable, will be void at the end
of the
Subscription Offering, and can only be exercised by delivering to
the
Holding Company or the Bank within the subscription period such properly
completed and executed order form, together with a check or money
order in
the full amount of the purchase price as specified in the order form
for
the shares of Common Stock for which the recipient elects to subscribe
in
the Subscription Offering (or by authorizing on the order form that
the
Bank withdraw said amount from the subscriber’s Deposit Account at the
Bank); and
|
| |
G.
|
A
statement to the effect that the executed order form, once received
by the
Holding Company or the Bank, may not be modified or amended by the
subscriber without the consent of the Holding Company or the
Bank.
|
With
the
exception of purchases through individual retirement accounts, Keogh accounts
and 401(k) plan accounts, shares of Common Stock purchased in the Subscription
Offering must be registered in the names of all depositors on the qualifying
Deposit Account(s). The ability to register Common Stock in a different name
than the names of all of the depositors on the qualifying Deposit Account does
not affect whether the depositors on the qualifying Deposit Account are
Associates or are otherwise Acting in Concert with each other or with other
individuals with other qualifying Deposit Accounts.
Notwithstanding
the above, the Bank and the Holding Company reserve the right in their sole
discretion to accept or reject orders received on order forms via facsimile
or
that have been photocopied.
|
9.
|
Undelivered,
Defective or Late Order Form; Insufficient
Payment
|
In
the
event order forms (a) are not delivered and are returned to the Holding
Company or the Bank by the United States Postal Service or the Holding Company
is unable to locate the addressee, (b) are not received back by the Holding
Company or the Bank or are received by the
Holding
Company or the Bank after the expiration date specified thereon, (c) are
defectively filled out or executed, (d) are not accompanied by the full
required payment for the shares of Common Stock subscribed for (including cases
in which Deposit Accounts from which withdrawals are authorized are insufficient
to cover the amount of the required payment), or (e) are not mailed
pursuant to a “no mail” order placed in effect by the account holder, the
subscription rights of the Person to whom such rights have been granted will
lapse as though such Person failed to return the completed order form within
the
time period specified thereon; provided,
that
the
Holding Company may, but will not be required to, waive any immaterial
irregularity on any order form or require the submission of corrected order
forms or the remittance of full payment for subscribed shares by such date
as
the Holding Company may specify. The interpretation by the Holding Company
of
terms and conditions of this Plan and of the order forms will be final, subject
to the authority of the OTS.
|
10.
|
Completion
of the Stock Offering
|
The
Stock
Offering will be terminated if not completed within 90 days from the date on
which the prospectus is declared effective by the OTS unless an extension is
approved by the OTS.
|
11.
|
Market
for Common Stock
|
If
at the
close of the Stock Offering the Holding Company has more than 100 shareholders
of any class of stock, the Holding Company shall use its best efforts
to:
| |
(i)
|
encourage
and assist a market maker to establish and maintain a market for
that
class of stock; and
|
| |
(ii)
|
list
that class of stock on a national or regional securities exchange,
or on
the Nasdaq quotation system.
|
|
12.
|
Stock
Purchases by Management Persons After the Stock
Offering
|
For
a
period of three years after the Stock Offering, no Management Person or his
or
her Associates may purchase, without the prior written approval of the OTS,
any
Common Stock, except from a broker-dealer registered with the SEC, except that
the foregoing shall not apply to:
| |
A.
|
Negotiated
transactions involving more than 1% of the outstanding stock in the
class
of stock; or
|
| |
B.
|
Purchases
of stock made by and held by any Tax-Qualified or Non-Tax Qualified
Employee Plan even if such stock is attributable to Management Persons
or
their Associates.
|
|
13.
|
Resales
of Stock by Directors and
Officers
|
Common
Stock purchased by Officers, directors and their Associates in the Stock
Offering may not be resold for a period of at least one year following the
date
of purchase, except in the case of death of an Officer, director or their
Associate.
Each
stock certificate shall bear a legend giving appropriate notice of the
restrictions set forth in Section 13
above.
Appropriate instructions shall be issued to the Holding Company’s transfer agent
with respect to applicable restrictions on transfers of such stock. Any shares
of stock issued as a stock dividend, stock split or otherwise with respect
to
such restricted stock, shall be subject to the same restrictions as apply to
the
restricted stock.
|
15.
|
Restriction
on Financing Stock
Purchases
|
The
Holding Company and the Bank will not loan funds to any Person to purchase
Common Stock in the Stock Offering, and will not knowingly offer or sell any
of
the Common Stock to any Person whose purchase would be financed by funds loaned
to the Person by the Holding Company, the Bank or any Affiliate.
The
Board
of Directors of the Bank and/or the Holding Company intend to adopt one or
more
stock benefit plans for employees, officers and directors, including an ESOP,
stock award plans and stock option plans, which will be authorized to purchase
Common Stock and grant options for Common Stock. However, only the Tax-Qualified
Employee Plans will be permitted to purchase Common Stock in the Stock Offering,
subject to the purchase priorities set forth in this Plan. The Board of
Directors of the Bank intends to establish the ESOP and authorize the ESOP
and
any other Tax-Qualified Employee Plans to purchase in the aggregate up to 4.9%
of the shares of Common Stock to be outstanding immediately following the
completion of the Stock Offering. The Bank or the Holding Company may make
scheduled discretionary contributions to one or more Tax-Qualified Employee
Plans to purchase Common Stock issued in the Stock Offering, or to purchase
issued and outstanding shares of Common Stock in the open market or from
authorized but unissued shares of Common Stock or treasury shares from the
Holding Company subsequent to the completion of the Stock Offering; provided
such
contributions do not cause the Bank to fail to meet any of its regulatory
capital requirements. In addition to shares purchased by one or more
Tax-Qualified Employee Plans in this Stock Offering, any subsequent stock
offering, and/or from authorized but unissued shares or treasury shares of
the
Holding Company, this Plan also specifically authorizes the Holding Company
to
grant awards under one or more stock benefit plans, including stock recognition
and award plans and stock option plans, in an amount up to 25% of the shares
of
Common Stock held by persons other than the MHC.
|
17.
|
Post-Stock
Issuance Filing and Market
Making
|
If
the
Holding Company has more than 35 stockholders of any class of stock, the Holding
Company shall register its Common Stock with the SEC pursuant to the Exchange
Act, and shall undertake not to deregister such Common Stock for a period of
three years thereafter.
|
18.
|
Payment
of Dividends and Repurchase of
Stock
|
The
Holding Company may not declare or pay a cash dividend on its Common Stock
if
the effect thereof would cause the regulatory capital of the Bank to be reduced
below the amount
required
under Section 567.2 of the Regulations. Otherwise, the Holding Company may
declare dividends or make other capital distributions in accordance with
Section 563b.520 of the Regulations. Following completion of the Stock
Offering, the Holding Company may repurchase its Common Stock consistent with
Section 563b.510 and Section 563b.515 of the Regulations relating to
stock repurchases, as long as such repurchases do not cause the regulatory
capital of the Bank to be reduced below the amount required under
Section 563b.450 of the Regulations. The MHC may from time to time purchase
Common Stock. Subject to any notice or approval requirements of the OTS under
the Regulations, the MHC may waive its right to receive dividends declared
by
the Holding Company.
|
19.
|
Stock
Offering Expenses
|
The
Regulations require that the expenses of any Stock Offering must be reasonable.
The Holding Company will use its best efforts to assure that the expenses
incurred by the Bank and the Holding Company in effecting the Stock Offering
will be reasonable.
|
20.
|
Employment
and Other Severance
Agreements
|
Following
or contemporaneously with the Stock Offering, the Bank and/or the Holding
Company may enter into employment and/or severance arrangements with one or
more
executive officers of the Bank and/or the Holding Company. It is anticipated
that any employment contracts entered into by the Bank and/or the Holding
Company will be for terms not exceeding three years and that such contracts
will
provide for annual renewals of the term of the contracts, subject to approval
by
the Board of Directors. The Bank and/or the Holding Company also may enter
into
severance arrangements with one or more executive officers that provide for
the
payment of severance compensation in the event of a change in control of the
Bank and/or the Holding Company. The significant terms of such employment and
severance arrangements have not been determined as of this time, but will be
described in any prospectus circulated in connection with the Stock Offering
and
will be subject to and comply with all regulations of the OTS.
|
21.
|
Residents
of Foreign Countries and Certain
States
|
The
Holding Company will make reasonable efforts to comply with the securities
laws
of all states in the United States in which Persons entitled to subscribe for
shares of Common Stock pursuant to this Plan reside. However, no such Person
will be issued subscription rights in the Subscription Offering or be permitted
to purchase shares of Common Stock if such Person resides in a foreign country
or in a state of the United States with respect to which any of the following
apply: (A) a small number of Persons otherwise eligible to subscribe for shares
under this Plan reside in such state; (B) the issuance of subscription rights
or
the offer or sale of shares of Common Stock to such Persons would require the
Holding Company, under the securities laws of such state, to register as a
broker, dealer, salesman in such state; or (C) such registration or
qualification would be impracticable for reasons of cost or
otherwise.
All
interpretations of this Plan and application of its provisions to particular
circumstances by a majority of the Board of Directors of the Bank shall be
final, subject to the authority of the OTS.
|
23.
|
Amendment
or Termination of the Plan
|
If
necessary or desirable, the terms of the Plan may be substantially amended
by a
majority vote of the Holding Company’s Board of Directors as a result of
comments from regulatory authorities or otherwise at any time prior to the
approval of the Plan by the OTS and at any time thereafter with the concurrence
of the OTS. The Plan may be terminated by a majority vote of the Board of
Directors at any time prior to the earlier of approval of the Plan by the OTS
and may be terminated by a majority vote of the Board of Directors at any time
thereafter with the concurrence of the OTS.
Dated:
January 24, 2007, as amended on April 25, 2007 and on May 7,
2007
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