Liberty Bell Bank Enters Into Purchase Agreement with Kenneth Lehman
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According to a release, pursuant to this stock purchase agreement, Lehman has agreed to purchase, simultaneously with the closing of the Bank's pending stock offering, and subject to certain limitations, at the subscription price of
President and CEO
Under the stock purchase agreement, the number of shares Lehman can purchase is limited so as to prevent an "ownership change" under Section 382 of the Internal Revenue Code of 1986. The number of shares that Lehman will purchase increases depending on the number of shares sold in the offering. If 2,100,000 shares are sold in the offering, Lehman would purchase 2,900,000 shares pursuant to his agreement. The agreement contains other provisions limiting the ability of Lehman and other large shareholders' (holding 2 percent or more of the Bank's common stock) to acquire additional shares over the next three years, in order to prevent such an "ownership change." Such a change would adversely affect the Bank's future ability to use its federal net-operating loss carry-forwards of
The agreement contains standard representations, warranties and covenants by both parties. Lehman has also agreed to certain voting limitations with respect to shares of common stock he acquires after the closing of this transaction. In addition, the Bank is granting to Lehman preemptive rights with respect to any shares of common stock that may be issued by the Bank in the three-year period following the closing date, which will enable him to maintain his proportionate common stock-equivalent interest in the Bank. The agreement also provides that after the closing Lehman may identify problem assets with a carrying value of up to
The issuance of the Bank's common stock to Lehman and in the pending stock offering is subject to approval by the
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