BSJ Shareholders' Agreement (2024)

(k)

“Exercising Party” has the meaning set forth in Section 6(d).

(l) “Fair Value” of a share of Common Stock means the appraised value of the Common Stock as determined by the most recent (not older than 12 months) appraisal by an independent, qualified investment banking firm or financial consultant satisfactory to the Board in its sole discretion, using valuation methodologies that the appraiser deems reasonable. If no Fair Value exists, and the parties do not otherwise agree on a Fair Value through arm’s-length negotiations, either party may elect to have the Fair Value determined, in which case the Board will select an independent, qualified investment banking firm or financial consultant to determine the Fair Value. In that case, the costs of the appraisal would be borne equally by the Company and the Transferring Shareholder unless otherwise agreed upon in writing prior to the determination. (m) A “Family Group” means, in each case, the members of a particular family group that (i) are eligible to be treated as a single shareholder under section 1361(c)(1) of the Code, and (ii) are expressly designated in writing as part of a Family Group by the Board. The determination of what constitutes a Family Group will be made by the Board. (n) “Minimum Ownership Amount” means 600 shares of Common Stock; provided, however, that in the event of any pro rata increase or decrease in the outstanding shares of Common Stock by reason of any stock dividend, stock split, reverse stock split or other similar corporate action, the Minimum Ownership Amount will automatically be increased or decreased, as appropriate, in an amount proportionate to the change in the number of outstanding shares of Common Stock. (o) “Offered Shares” has the meaning set forth in Section 3(a). (p) “Permitted Person” means (i) an existing shareholder of the Company, (ii) a person who is a member of the Transferring Shareholder’s Family Group, (iii) a trust formed exclusively for the benefit of the Transferring Shareholder or one or more person(s) described in clause (i) or (ii) above, (iv) the Company or its assignee, or (v) in the sole discretion of the Board, any other Eligible Shareholder. The determination of who constitutes a Permitted Person will be made by the Board. (q) “Permitted Transfer” means any Transfer other than a Prohibited Transfer. (r) “Prohibited Transfer” means any Transfer that (i) would be to a person other than a Permitted Person, (ii) would not comply with the provisions of this Agreement, (iii) would be to a person which is not an Eligible Shareholder, (iv) would result in a Transfer to more than one person to be held jointly of record as shareholders, other than shares owned jointly by a husband and wife, (v) would result in the ownership of fractional shares of Common Stock by the Transferring Shareholder or the Proposed Transferee, or (vi) would cause, or would create a material risk of causing, the Company to be ineligible to be an S Corporation. In addition to the foregoing, a Transfer will be a “Prohibited Transfer” if, after giving effect to the Proposed Transfer, (1) the Proposed Transferee would not own of record, individually or together with his or her spouse, at least the Minimum Ownership Amount, unless the Proposed Transferee is an employee of the Bank, and a record shareholder of the Company, as of the date of the Proposed Transfer, or (2) the Transferring Shareholder would own less than the Minimum Ownership Amount, unless the Proposed Transfer terminated the interest of the Transferring Shareholder in the Company. A Proposed Transfer to a usufruct will be deemed a “Prohibited Transfer” unless the usufructuary and each naked owner are Eligible Shareholders. The determination of what constitutes a Prohibited Transfer will be made by the Board. For purposes of clarity and without limiting the Board’s discretion hereunder, the Board may determine that a Proposed Transfer that would increase the number of shareholders of the Company at any time, calculated for an S Corporation as provided in section 1361

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