CALDERWOOD & HARKNESS LLP One Liberty Plaza, 52nd Floor New York, New York 10006
INTERNAL MEMORANDUM / WORKING DOCUMENT
ATTORNEY WORK PRODUCT — PRIVILEGED AND CONFIDENTIAL
This memorandum constitutes attorney work product and is protected by the attorney-client privilege. It is prepared solely for the use of the Calderwood & Harkness LLP engagement team and authorized representatives of Belmont Ridge Bank, National Association. Distribution or disclosure to any other party without prior written authorization of the responsible partner is strictly prohibited.
TO: Calderwood & Harkness LLP Capital Markets Engagement Team; Diane K. Wexler, General Counsel & Corporate Secretary, Belmont Ridge Bank, National Association
FROM: Claire Dempsey, Working Associate, Capital Markets, Calderwood & Harkness LLP
REVIEWED BY: Eric Johannsen, Lead Associate, Capital Markets; Vivienne St. Claire, Responsible Partner, Capital Markets
DATE: February 24, 2026
MATTER NO.: 1045-00001
CLIENT: Belmont Ridge Bank, National Association
RE: Summary of BRB's Obligations under the Registration Rights Agreement dated February 24, 2026, entered into in connection with the $350,000,000 aggregate principal amount of 6.750% Fixed-to-Floating Rate Subordinated Notes due 2036 (CUSIP 082651 AB7)
REGISTRATION RIGHTS OBLIGATIONS SUMMARY
BRB 6.750% Fixed-to-Floating Rate Subordinated Notes due 2036
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1. Introduction and Purpose
The purpose of this memorandum is to provide the Calderwood & Harkness LLP engagement team and Belmont Ridge Bank, National Association's ("BRB" or the "Issuer") in-house legal team (attention: Diane K. Wexler, General Counsel & Corporate Secretary) with a concise yet comprehensive summary of BRB's material obligations, deadlines, and potential liability exposure under that certain Registration Rights Agreement, dated as of February 24, 2026 (the "Registration Rights Agreement" or "RRA").
The RRA was entered into on February 24, 2026 (the "Closing Date"), among Belmont Ridge Bank, National Association, as issuer, and the following entities in their capacity as initial purchasers (collectively, the "Initial Purchasers"):
(a) Wainwright Zanthor & Co., LLC, acting as Representative of the Initial Purchasers (the "Representative");
(b) Redstone Capital Markets LLC; and
(c) Kensington Hale Securities Inc.
The RRA was executed and delivered in connection with the issuance by BRB of $350,000,000 aggregate principal amount of its 6.750% Fixed-to-Floating Rate Subordinated Notes due 2036 (CUSIP 082651 AB7) (the "Notes" or the "Initial Notes"). The Notes were offered and sold in a private placement to qualified institutional buyers ("QIBs") in reliance upon the exemption from registration provided by Rule 144A under the Securities Act of 1933, as amended (the "Securities Act"), and in accordance with Section 4(a)(2) of the Securities Act. Because the Notes were not registered under the Securities Act, they bear customary transfer restriction legends and are subject to restrictions on resale. The RRA sets forth the registration rights granted to the holders of the Notes and the corresponding obligations of BRB designed to facilitate the eventual public resale or exchange of the Notes.
The RRA is governed by the laws of the State of New York, without regard to conflict of laws principles that would cause the application of the laws of any other jurisdiction. All disputes arising under the RRA are subject to the exclusive jurisdiction of the federal and state courts located in the Borough of Manhattan, City of New York.
This summary is intended as a working reference only and does not substitute for review of the full text of the Registration Rights Agreement. All section references herein are to the RRA unless otherwise specifically indicated. In the event of any conflict between the descriptions contained in this memorandum and the terms of the RRA itself, the terms of the RRA shall govern. The engagement team and BRB's in-house legal department should rely on the executed RRA in all instances where precision is required.
2. Overview of Registration Rights Pathways
The RRA establishes two distinct pathways by which BRB may satisfy its registration obligations with respect to the Notes: (i) an exchange offer pathway, which constitutes BRB's primary obligation, and (ii) a shelf registration pathway, which serves as an alternative or supplemental obligation triggered under certain specified circumstances. Each pathway is summarized below in general terms, with detailed deadlines and requirements set forth in Sections 3 and 4, respectively.
2.1 Exchange Offer Path (Primary Obligation)
BRB's primary obligation under the RRA is to conduct a registered exchange offer (the "Exchange Offer"). In the Exchange Offer, BRB would offer to exchange the original unregistered Notes (variously referred to herein as the "Initial Notes" or "Restricted Notes") for a new series of notes (the "Exchange Notes") with terms substantially identical to those of the Initial Notes, except that the Exchange Notes will have been registered under the Securities Act pursuant to an effective registration statement and will not bear the transfer restriction legends currently affixed to the Initial Notes.
The Exchange Notes will be issued under the same Indenture, dated as of February 24, 2026 (the "Indenture"), between BRB, as issuer, and Brindoval Trust Company, National Association, as trustee (the "Trustee"), paying agent, registrar, and transfer agent. Pursuant to the terms of the Indenture and the RRA, the Exchange Notes will be considered the same series of debt securities as the Initial Notes for all purposes under the Indenture. The Exchange Notes will bear the same CUSIP number as the Initial Notes (or a new CUSIP number if required by The Depository Trust Company ("DTC") or applicable market convention) and will carry identical economic terms, including:
• A fixed coupon rate of 6.750% per annum, payable semi-annually on March 1 and September 1 of each year, during the fixed rate period (through and including March 1, 2031);
• A floating rate of Compounded SOFR plus 275 basis points per annum, payable quarterly, during the floating rate period (commencing after March 1, 2031, the rate reset date);
• A maturity date of March 1, 2036; and
• The same optional and regulatory redemption provisions, subordination provisions, and other covenants as set forth in the Indenture.
The exchange offer mechanism is a customary approach in Rule 144A offerings of this nature and is designed to provide holders of the Initial Notes with freely tradeable securities without requiring BRB to undertake a public offering or assume the ongoing obligations associated with a shelf registration statement.
2.2 Shelf Registration Path (Alternative / Supplemental Obligation)
Under certain specified circumstances detailed in Section 4 of this memorandum, BRB is required to file a shelf registration statement in lieu of, or in addition to, the Exchange Offer. The shelf registration statement would register the resale of the Initial Notes by the holders thereof on a continuous or delayed basis pursuant to Rule 415 under the Securities Act.
The shelf registration statement would be filed on Form S-1 under the Securities Act or, if available at the time of filing, on Form S-3. As a threshold matter, the engagement team should note that BRB is a national banking association, and the publicly listed entity in the corporate family is Belmont Ridge Financial Group, Inc. ("BRFG"), BRB's parent holding company (NYSE: BRBK). Shelf eligibility analysis under the Securities Act must account for the fact that the Notes are bank-issued securities and that BRB's registration and reporting obligations under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), are derivative of BRFG's status as an SEC registrant. The availability of Form S-3 will depend on, among other factors, whether BRB (or BRFG as a co-registrant, if applicable) satisfies the registrant requirements and transaction requirements of General Instruction I.A of Form S-3 at the time of filing. This analysis should be conducted closer to the time any Shelf Trigger Event (defined below) occurs.
3. Exchange Offer Obligations — Detailed Deadlines and Requirements
This Section 3 sets forth in detail BRB's obligations with respect to the filing, effectiveness, commencement, and consummation of the Exchange Offer, including all applicable deadlines and procedural requirements specified in the RRA.
3.1 Filing of Exchange Offer Registration Statement
Deadline: Pursuant to Section 2(a) of the RRA, BRB must file with the U.S. Securities and Exchange Commission (the "SEC") a registration statement on an appropriate form under the Securities Act (the "Exchange Offer Registration Statement") covering the offer and issuance of the Exchange Notes in exchange for the Initial Notes. This filing must occur within 180 days after the Closing Date.
Calculated Deadline: On or before August 23, 2026.
The Exchange Offer Registration Statement must comply in all material respects with the requirements of the Securities Act and the applicable rules and regulations of the SEC, including Regulation C and the applicable form requirements. The registration statement must contain a prospectus that complies with the requirements of Section 10 of the Securities Act and that includes all information required to be disclosed in connection with an exchange offer for debt securities of this type, including a description of the terms of the Exchange Notes, the procedures for tendering Initial Notes, and the federal income tax consequences of the exchange.
BRB must use commercially reasonable efforts to cause the Exchange Offer Registration Statement to be declared effective by the SEC as promptly as practicable after filing. In this regard, BRB's obligation includes the duty to respond to any comments from the SEC staff in a timely manner, to file amendments and supplements as necessary to address such comments, and to take all other actions reasonably necessary to obtain effectiveness.
3.2 Effectiveness of Exchange Offer Registration Statement
Deadline: Pursuant to Section 2(b) of the RRA, BRB must use commercially reasonable efforts to have the Exchange Offer Registration Statement declared effective by the SEC within 270 days after the Closing Date.
Calculated Deadline: On or before November 21, 2026.
The obligation is framed as a "commercially reasonable efforts" standard, which requires BRB to undertake diligent and good faith actions to achieve effectiveness within the specified timeframe, but does not impose an absolute guarantee of SEC action within such period. Nevertheless, if effectiveness is not achieved by the 270-day deadline, regardless of the reason (including delays attributable to SEC review), a Registration Default will occur, and Liquidated Damages will begin to accrue as described in Section 5 below.
Upon the Exchange Offer Registration Statement being declared effective by the SEC, BRB must promptly notify the Initial Purchasers and all registered holders of the Initial Notes of such effectiveness. Such notification must be provided no later than two (2) business days after the date of effectiveness.
3.3 Commencement and Completion of the Exchange Offer
Commencement Deadline: Pursuant to Section 2(c) of the RRA, BRB must commence the Exchange Offer promptly after the Exchange Offer Registration Statement is declared effective by the SEC, and in any event within 30 business days of the date of effectiveness. Commencement of the Exchange Offer means the date on which BRB first distributes or causes to be distributed to registered holders of the Initial Notes the exchange offer prospectus and related letter of transmittal (or notice of guaranteed delivery instructions).
Minimum Offer Period: The Exchange Offer must remain open for a minimum period of 20 business days from the date of commencement, as required by Rule 14e-1 under the Securities Exchange Act of 1934, as amended (the "Exchange Act"). While the RRA does not separately impose a minimum offer period beyond that required by applicable law, BRB should be mindful that any failure to comply with Rule 14e-1 would constitute a violation of applicable securities laws in addition to any potential breach of the RRA.
Completion Deadline: Pursuant to Section 2(d) of the RRA, BRB must consummate the Exchange Offer within 330 days after the Closing Date.
Calculated Deadline: On or before January 20, 2027.
For purposes of the RRA, "consummation" of the Exchange Offer means the date on which BRB accepts for exchange all Initial Notes properly tendered (and not validly withdrawn) in the Exchange Offer and issues the corresponding Exchange Notes to the tendering holders (or their designees). BRB must accept for exchange all Initial Notes validly tendered and not withdrawn prior to the expiration of the Exchange Offer. BRB may not impose conditions on the Exchange Offer other than the following customary conditions:
(i) no stop order suspending the effectiveness of the Exchange Offer Registration Statement shall have been issued by the SEC and shall remain in effect;
(ii) no proceeding seeking such a stop order shall have been threatened or initiated by the SEC and shall remain pending;
(iii) no action, suit, or proceeding shall be pending or threatened that challenges the Exchange Offer or that seeks to enjoin or prohibit the Exchange Offer;
(iv) no change in law or regulation shall have occurred that would make the Exchange Offer illegal or otherwise impermissible; and
(v) BRB shall have received all governmental approvals necessary in connection with the Exchange Offer that are required to be obtained prior to the consummation thereof.
The engagement team should note that the 330-day completion deadline is an absolute deadline that is not subject to a "commercially reasonable efforts" qualifier. If the Exchange Offer is not consummated on or before January 20, 2027, a Registration Default will occur, and Liquidated Damages will begin to accrue.
3.4 Procedural Requirements for the Exchange Offer
In connection with the Exchange Offer, BRB is required to comply with the following procedural requirements, as set forth in Section 2 of the RRA:
(a) Prospectus Distribution. BRB must prepare and distribute (or cause to be distributed through the Trustee) to all registered holders of the Initial Notes an exchange offer prospectus meeting the requirements of Section 10 of the Securities Act. The prospectus must include, among other things, a description of the terms of the Exchange Offer, the material terms of the Exchange Notes, the procedures for tendering Initial Notes, the withdrawal rights of tendering holders, and a discussion of certain federal income tax consequences of the exchange.
(b) Prior Notice. BRB must provide at least 20 business days' prior written notice to holders of the Initial Notes before the commencement of the Exchange Offer. This notice must be delivered through the Trustee and must include, at a minimum, the anticipated commencement date, the anticipated expiration date, and a summary of the terms and conditions of the Exchange Offer.
(c) Acceptance of Tenders. BRB must accept for exchange all Initial Notes properly tendered and not validly withdrawn prior to the expiration date of the Exchange Offer.
(d) Issuance of Exchange Notes. BRB must cause the Exchange Notes to be issued and delivered to tendering holders (or their designated DTC participant accounts) within 5 business days after the expiration date of the Exchange Offer.
(e) DTC Eligibility. BRB must use commercially reasonable efforts to cause the Exchange Notes to be eligible for book-entry transfer and settlement through DTC, including obtaining all necessary approvals from DTC and complying with DTC's eligibility requirements for new debt securities.
3.5 Cooperation Obligations
The RRA imposes the following cooperation obligations on BRB in connection with the Exchange Offer:
(a) Cooperation with the Trustee. BRB must cooperate with Brindoval Trust Company, N.A., in its capacities as Trustee, Paying Agent, Registrar, and Transfer Agent under the Indenture, to facilitate the exchange and issuance of the Exchange Notes, including by providing all necessary documentation, instructions, and authorizations.
(b) Sharing of SEC Correspondence. BRB must furnish to each Initial Purchaser (through the Representative, Wainwright Zanthor & Co., LLC) copies of all correspondence between BRB and the SEC relating to the Exchange Offer Registration Statement, including all comment letters received from the SEC staff and all response letters submitted by BRB, subject to the confidentiality provisions set forth in Section 7(a) of the RRA. The engagement team should establish a protocol for timely sharing of SEC correspondence upon receipt.
(c) Legal Opinions and Certificates. BRB must provide customary legal opinions and officer's certificates at the time of consummation of the Exchange Offer, including (i) an opinion of counsel to BRB (which may be delivered by Calderwood & Harkness LLP as issuer's counsel) to the effect that the Exchange Notes have been duly authorized, executed, authenticated, and delivered and constitute valid and binding obligations of BRB, and (ii) an officer's certificate confirming the accuracy of BRB's representations and warranties in the RRA and the absence of any Registration Default.
4. Shelf Registration Obligations — Trigger Events and Deadlines
This Section 4 sets forth BRB's obligations with respect to the filing and maintenance of a shelf registration statement covering the resale of the Initial Notes, including the circumstances under which such obligations are triggered and the applicable deadlines.
4.1 Events Triggering the Shelf Registration Obligation
Pursuant to Section 3(a) of the RRA, BRB must file a shelf registration statement covering the resale of the Initial Notes if any of the following events occur (each, a "Shelf Trigger Event"):
(a) Legal Impediment to Exchange Offer. BRB is not permitted to conduct the Exchange Offer under applicable law or applicable interpretations of the SEC staff. This trigger is intended to address the possibility that the SEC may take the position that the exchange offer mechanism is not available for bank-issued subordinated notes or that regulatory developments otherwise preclude the Exchange Offer. The engagement team should monitor any relevant SEC staff guidance or no-action positions concerning exchange offers for bank capital instruments.
(b) Failure to Achieve Timely Effectiveness. The Exchange Offer Registration Statement is not declared effective by the SEC on or before the 270th day after the Closing Date (i.e., November 21, 2026).
(c) Failure to Consummate Exchange Offer. The Exchange Offer is not consummated on or before the 330th day after the Closing Date (i.e., January 20, 2027).
(d) Holder Notification Post-Exchange Offer. Any holder of the Initial Notes notifies BRB in writing within 20 business days after the consummation of the Exchange Offer that:
(i) such holder is prohibited by applicable law or applicable SEC policy from participating in the Exchange Offer;
(ii) such holder may not resell the Exchange Notes acquired in the Exchange Offer to the public without restriction under the Securities Act (for example, because such holder is an "affiliate" of BRB within the meaning of Rule 405 under the Securities Act); or
(iii) such holder is a broker-dealer that acquired Initial Notes directly from BRB or an affiliate of BRB (as distinguished from broker-dealers that acquired Initial Notes in open market transactions, who may generally resell Exchange Notes received in the Exchange Offer pursuant to the prospectus delivery requirements described in the Exchange Offer prospectus).
(e) Initial Purchaser Request. Any Initial Purchaser requests in writing that BRB file a shelf registration statement with respect to Initial Notes held by such Initial Purchaser that are not eligible to be exchanged for Exchange Notes in the Exchange Offer.
The engagement team should note that Shelf Trigger Events (a), (b), (c), and (e) operate independently of the Exchange Offer, whereas Shelf Trigger Event (d) is contingent upon the Exchange Offer having been consummated and a holder thereafter providing timely written notice. In the event that a Shelf Trigger Event occurs under clause (d) or (e), BRB's shelf registration obligation is limited to covering the resale of only those Initial Notes held by the notifying holder(s) or Initial Purchaser(s), as applicable.
4.2 Filing Deadline for Shelf Registration Statement
Deadline: Pursuant to Section 3(b) of the RRA, BRB must file a shelf registration statement with the SEC within 30 days after the date on which a Shelf Trigger Event occurs.
The shelf registration statement must be on Form S-1 under the Securities Act (or on Form S-3, if BRB is eligible to use Form S-3 at the time of filing, subject to the shelf eligibility considerations noted in Section 2.2 above). The shelf registration statement must cover resales of the Initial Notes by the holders thereof on a continuous or delayed basis pursuant to Rule 415 under the Securities Act.
BRB must identify as selling securityholders in the shelf registration statement all holders of the Initial Notes who have provided BRB with the required selling securityholder information in the form of a completed selling securityholder questionnaire. The form of selling securityholder questionnaire is attached to the RRA as Exhibit A. BRB is required to deliver the questionnaire to all holders of the Initial Notes promptly after the occurrence of a Shelf Trigger Event, and holders must return the completed questionnaire to BRB within the timeframe specified in BRB's request (typically 10 business days).
4.3 Effectiveness Deadline for Shelf Registration Statement
Deadline: Pursuant to Section 3(c) of the RRA, BRB must use commercially reasonable efforts to cause the shelf registration statement to be declared effective by the SEC within 90 days after the date on which the shelf registration statement is filed.
Once declared effective, BRB must keep the shelf registration statement continuously effective and usable (subject to permitted Blackout Periods as described below) for a period ending on the earlier of:
(i) the second anniversary of the Closing Date (i.e., February 24, 2028); or
(ii) such earlier date as of which all Notes covered by the shelf registration statement have been sold pursuant to the shelf registration statement or have otherwise become freely tradeable without restriction under Rule 144 under the Securities Act (including without regard to the volume limitations and manner-of-sale requirements of Rule 144(d), (e), and (f)).
This period is referred to herein as the "Effectiveness Period."
4.4 Ongoing Shelf Obligations
During the Effectiveness Period, BRB is subject to the following ongoing obligations with respect to the shelf registration statement:
(a) Amendments and Supplements. BRB must supplement and amend the shelf registration statement and the related prospectus as necessary to keep the shelf registration statement effective and the prospectus current and usable during the Effectiveness Period, including by filing post-effective amendments to reflect any material changes in the information set forth therein and prospectus supplements to update the list of selling securityholders or to reflect material developments.
(b) Distribution of Materials. BRB must furnish to all holders covered by the shelf registration statement copies of any prospectus supplement or amendment filed with the SEC within two (2) business days after the filing thereof.
(c) Blackout Periods. BRB may suspend use of the shelf registration prospectus (a "Blackout Period") for a period not to exceed 60 consecutive days and not more than 90 days in the aggregate in any 12-month period, if the Board of Directors of BRB (or a duly authorized committee thereof) determines in good faith that the continued use of the prospectus would require the disclosure of material non-public information that BRB has a bona fide business purpose for preserving as confidential and the disclosure of which at such time would, in the good faith judgment of the Board of Directors, be materially adverse to BRB or its business. The Board of Directors' determination must be set forth in a resolution adopted in accordance with BRB's governing documents.
(d) Notice of Blackout Periods. BRB must notify all holders covered by the shelf registration statement of the commencement and termination of any Blackout Period. Such notice must be provided promptly (and in any event within two business days after the commencement or termination, as applicable, of the Blackout Period). The notice of commencement need not, and should not, disclose the nature of the underlying material non-public information that gave rise to the Blackout Period. Holders must cease all sales under the shelf registration prospectus upon receipt of notice of the commencement of a Blackout Period and may resume sales upon receipt of notice of termination and delivery of an updated prospectus or prospectus supplement, as applicable.
5. Liquidated Damages Provisions
The RRA contains a detailed liquidated damages framework that serves as the primary financial consequence for BRB's failure to satisfy its registration obligations within the prescribed timeframes. The parties to the RRA have agreed that the liquidated damages set forth below represent a reasonable pre-estimate of the damages that holders of the Notes would suffer in the event of a registration delay, and that actual damages in such circumstances would be difficult or impossible to determine with precision.
5.1 Registration Default Events
Pursuant to Section 5(a) of the RRA, a "Registration Default" occurs upon the happening of any of the following events:
(a) The Exchange Offer Registration Statement is not filed with the SEC on or before the 180th day after the Closing Date (August 23, 2026);
(b) The Exchange Offer Registration Statement is not declared effective by the SEC on or before the 270th day after the Closing Date (November 21, 2026);
(c) The Exchange Offer is not consummated on or before the 330th day after the Closing Date (January 20, 2027);
(d) If a Shelf Trigger Event has occurred, the shelf registration statement is not filed with the SEC within 30 days after the date of such Shelf Trigger Event;
(e) If a Shelf Trigger Event has occurred, the shelf registration statement is not declared effective by the SEC within 90 days after the date of filing of such shelf registration statement; and
(f) The shelf registration statement, once declared effective, ceases to be effective or otherwise ceases to be usable by holders for resales of the Initial Notes for a period in excess of the permitted Blackout Period limitations (i.e., more than 60 consecutive days or more than 90 days in the aggregate in any 12-month period).
Each of the foregoing events constitutes a separate and independent Registration Default. Multiple Registration Defaults may exist simultaneously (e.g., a failure to consummate the Exchange Offer under clause (c) and a subsequent failure to timely file a shelf registration statement under clause (d)), but the Liquidated Damages described below do not compound or accumulate separately for concurrent Registration Defaults; rather, only a single stream of Liquidated Damages accrues at any given time, calculated at the applicable rate.
5.2 Liquidated Damages Rate and Mechanics
Upon the occurrence and during the continuance of any Registration Default, BRB is obligated to pay additional interest on the affected Notes in the form of liquidated damages ("Liquidated Damages") as follows:
Rate Schedule:
• First 90 days of a Registration Default: Liquidated Damages accrue at a rate of 0.25% per annum of the aggregate principal amount of the affected Notes.
• Days 91 through 180: The rate increases to 0.50% per annum.
• Days 181 through 270: The rate increases to 0.75% per annum.
• Day 271 and thereafter: The rate increases to and is capped at 1.00% per annum.
Maximum Rate Cap: The maximum aggregate rate of Liquidated Damages payable under the RRA shall not exceed 1.00% per annum of the principal amount of the affected Notes, regardless of the number of Registration Defaults that may be occurring concurrently or the duration of any individual Registration Default beyond the 270th day.
Dollar Impact — Calculation Based on $350,000,000 Outstanding Principal:
Payment Mechanics: Liquidated Damages are payable to holders of affected Notes on the same dates and in the same manner as regular interest payments on the Notes. During the fixed rate period (through and including March 1, 2031), regular interest on the Notes is payable semi-annually on March 1 and September 1 of each year; Liquidated Damages, if any, will likewise be payable on such dates. Following the transition to the floating rate period (after March 1, 2031), interest is payable quarterly; Liquidated Damages, if any, will correspondingly be payable on a quarterly basis. Liquidated Damages will be computed on the basis of a 360-day year consisting of twelve 30-day months, consistent with the interest computation methodology under the Indenture.
Cessation of Liquidated Damages: Liquidated Damages cease to accrue on the date on which the applicable Registration Default is cured. A Registration Default under clause (a) above is cured upon the filing of the Exchange Offer Registration Statement; a Registration Default under clause (b) is cured upon the Exchange Offer Registration Statement being declared effective; a Registration Default under clause (c) is cured upon the consummation of the Exchange Offer; and so forth for each respective category.
Exclusive Remedy: The RRA expressly provides that Liquidated Damages constitute the sole and exclusive remedy of holders of the Notes and the Initial Purchasers for any Registration Default, and no holder or Initial Purchaser shall be entitled to recover any other damages, whether consequential, incidental, or otherwise, on account of any Registration Default. Notwithstanding the foregoing, this limitation on remedies does not affect or limit the right of any holder or Initial Purchaser to bring an action for specific performance of BRB's registration obligations under the RRA, including by seeking injunctive relief to compel BRB to file, cause to become effective, or maintain the effectiveness of a registration statement or to consummate the Exchange Offer.
5.3 Maximum Aggregate Exposure Estimate
For purposes of BRB's internal financial planning and the engagement team's risk assessment, the maximum annual Liquidated Damages exposure, assuming all applicable deadlines are missed and a Registration Default continues for a full calendar year at the capped rate of 1.00% per annum, is approximately $3,500,000 per annum (based on the $350,000,000 aggregate principal amount of the Notes).
To put this figure in context, this represents an incremental cost above the stated coupon of 6.750% per annum, effectively increasing BRB's all-in cost of the Notes to 7.750% per annum during any period in which the maximum Liquidated Damages rate is in effect. While this additional cost is meaningful, the engagement team should advise BRB that the reputational consequences of a Registration Default — particularly a prolonged one — may be of equal or greater concern, as institutional investors and market participants closely monitor issuer compliance with registration rights commitments, and a default could adversely affect BRB's ability to access the capital markets on favorable terms in the future.
6. Notice Requirements
The RRA imposes extensive notice obligations on BRB, the holders of the Notes, and the Initial Purchasers. Timely compliance with these notice requirements is critical both to the orderly administration of the registration rights framework and to the avoidance of potential Registration Defaults. The key notice obligations are summarized below.
6.1 Notices to Holders
BRB must provide written notice to all registered holders of the Initial Notes (which notice shall be delivered through the Trustee, Brindoval Trust Company, N.A., in accordance with the notice provisions of the Indenture) of the following events:
(a) Filing of Registration Statement. Notice of the filing with the SEC of the Exchange Offer Registration Statement or any shelf registration statement, to be provided promptly after filing;
(b) Effectiveness of Registration Statement. Notice of the effectiveness of the Exchange Offer Registration Statement or any shelf registration statement, to be provided promptly and in no event later than two (2) business days after the date of effectiveness;
(c) Commencement of Exchange Offer. Notice of the commencement of the Exchange Offer, to be provided at least 20 business days before the commencement date;
(d) Expiration and Results of Exchange Offer. Notice of the expiration and results of the Exchange Offer, including the aggregate principal amount of Initial Notes tendered and accepted for exchange, to be provided within five (5) business days after the completion of the Exchange Offer;
(e) Blackout Periods. Notice of the commencement and termination of any Blackout Period (in the case of a shelf registration statement), to be provided promptly and in no event later than two (2) business days after the commencement or termination, as applicable; and
(f) Post-Effective Amendments and Supplements. Notice of any event that requires the filing of a post-effective amendment to, or a prospectus supplement with respect to, the Exchange Offer Registration Statement or any shelf registration statement, to the extent that such event would require holders to take any action (such as ceasing sales under a shelf prospectus).
6.2 Notices to BRB
Holders of the Initial Notes are subject to the following notice obligations running to BRB:
(a) Selling Securityholder Questionnaire. Any holder wishing to be included as a selling securityholder in a shelf registration statement must provide BRB with a completed selling securityholder questionnaire (in the form attached to the RRA as Exhibit A) within the timeframe specified in BRB's request, which shall not be less than 10 business days from the date of BRB's request. Holders who fail to timely return the completed questionnaire will not be named as selling securityholders in the initial shelf registration statement but may be added through a subsequent prospectus supplement or post-effective amendment.
(b) Shelf Trigger Notice. Any holder claiming a Shelf Trigger Event under Section 4.1(d) of this memorandum (corresponding to Section 3(a)(iv) of the RRA) must deliver written notice to BRB within 20 business days after the date of consummation of the Exchange Offer. The notice must specify the basis for the holder's claim (i.e., that the holder is prohibited from participating in the Exchange Offer, cannot freely resell Exchange Notes, or is a broker-dealer that acquired Initial Notes directly from BRB or an affiliate). Failure to deliver timely notice will result in the loss of the holder's right to request a shelf registration.
6.3 Notices Between BRB and the Initial Purchasers
The following notice obligations govern communications between BRB and the Initial Purchasers under the RRA:
(a) SEC Correspondence. BRB must provide copies of all SEC correspondence and staff comment letters related to the Exchange Offer Registration Statement or any shelf registration statement, as well as copies of BRB's response letters, to Wainwright Zanthor & Co., LLC, as Representative of the Initial Purchasers. Such copies shall be provided promptly upon receipt (in the case of SEC comment letters) or upon filing (in the case of BRB response letters). Copies should be sent to the attention of:
Douglas P. Moreno Head of Debt Capital Markets (Bank Capital) Wainwright Zanthor & Co., LLC 383 Madison Avenue New York, NY 10179
(b) Formal Notices. All formal notices required or permitted under the RRA must be in writing and must be delivered by hand delivery, by nationally recognized overnight courier service (with proof of delivery), or by electronic mail (with confirmation of receipt) to the respective parties at the addresses specified in Section 8 of this memorandum. Notices delivered by hand or overnight courier shall be deemed given when received; notices delivered by electronic mail shall be deemed given when the sender receives electronic confirmation of delivery (but only if followed within one business day by delivery via hand or overnight courier).
7. Critical Dates Timeline Chart
The following chart summarizes the critical dates and deadlines under the RRA. The engagement team and BRB's in-house legal department should docket all of the dates set forth below, together with the internal advance target dates recommended in Section 11. Dates that fall on a weekend or federal holiday should be adjusted in accordance with the RRA's business day convention (next succeeding business day).
8. Notice Addresses Under the RRA
All notices, requests, demands, and other communications required or permitted under the RRA must be delivered to the parties at the following addresses (or at such other address as a party may designate by notice in accordance with the RRA):
The engagement team should maintain a current contact list for all parties and should confirm email addresses for each contact person listed above prior to any time-sensitive communications. In addition, the engagement team should confirm the notice provisions of the RRA with respect to the method and timing of deemed delivery for notices sent by electronic mail, which is permitted under the RRA only if followed within one business day by delivery via hand or overnight courier.
9. BRB's Ongoing Covenants and Cooperation Obligations
In addition to the specific registration obligations described in Sections 3 and 4, the RRA imposes certain ongoing covenants and cooperation obligations on BRB. These obligations are summarized below.
9.1 SEC Reporting and Availability of Information
BRB must use commercially reasonable efforts to comply with the reporting requirements of the Exchange Act and to make publicly available (or, where public availability is not practicable, to make available through the Trustee to holders of the Notes upon request) the information required under Rule 144(c) of the Securities Act. This obligation is designed to facilitate the resale of the Initial Notes under Rule 144 by ensuring that the "current public information" requirement of Rule 144(c) is satisfied.
The engagement team should note that BRB is a national banking association and is not itself an SEC reporting company. BRB's parent holding company, Belmont Ridge Financial Group, Inc. ("BRFG"), is the SEC registrant and files periodic reports with the SEC under the Exchange Act (NYSE ticker symbol: BRBK; SEC CIK: 0001847392). BRB must coordinate with BRFG to ensure that BRFG's ongoing Exchange Act reporting compliance is maintained and that the Rule 144(c) information requirements are satisfied on a continuous basis. The engagement team should advise BRB's General Counsel to establish an internal protocol with BRFG's corporate secretary and external counsel for monitoring BRFG's SEC filing compliance, with particular attention to the timely filing of annual reports on Form 10-K, quarterly reports on Form 10-Q, and current reports on Form 8-K.
9.2 Indemnification. The RRA contains customary indemnification provisions, which are summarized as follows:
(a) BRB's Indemnification of Holders and Initial Purchasers. BRB is required to indemnify, defend, and hold harmless each holder of registrable securities covered by a registration statement (whether the Exchange Offer Registration Statement or a shelf registration statement), each Initial Purchaser, and each of their respective directors, officers, partners, members, employees, agents, and controlling persons (within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act), against any and all losses, claims, damages, liabilities, and expenses (including reasonable attorneys' fees and expenses of investigation) arising out of or based upon:
(i) any untrue statement or alleged untrue statement of a material fact contained in the registration statement, the prospectus, any amendment or supplement thereto, or any preliminary prospectus, or any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein (in the case of a prospectus, in light of the circumstances under which they were made) not misleading; or
(ii) any violation by BRB of the Securities Act, the Exchange Act, or any state securities or "blue sky" laws in connection with the registration or offering covered by such registration statement.
BRB's indemnification obligation is subject to the customary exception that BRB shall not be liable to the extent that any such loss, claim, damage, liability, or expense arises out of or is based upon any untrue statement or omission made in reliance upon and in conformity with written information furnished to BRB by or on behalf of the indemnified party specifically for use in such registration statement, prospectus, or amendment or supplement thereto.
(b) Reciprocal Indemnification by Selling Holders. Each selling holder named in a shelf registration statement is required to provide a reciprocal indemnification to BRB, the Initial Purchasers, and their respective controlling persons, but only with respect to written information furnished by such selling holder to BRB specifically for use in the shelf registration statement or related prospectus. The liability of each selling holder under this reciprocal indemnification is limited to the net proceeds received by such selling holder from the sale of Notes pursuant to the shelf registration statement.
9.3 Expenses. The RRA allocates the costs and expenses of registration as follows:
(a) Registration Expenses Borne by BRB. BRB bears all "Registration Expenses," which are defined in the RRA to include all expenses incurred in connection with the Exchange Offer or shelf registration, including without limitation: SEC filing fees; printing and engraving expenses; fees and disbursements of BRB's counsel (Calderwood & Harkness LLP); fees and disbursements of BRB's independent registered public accounting firm (Whitmore & Lathrop, P.C.); fees and expenses of the Trustee; FINRA filing fees (if applicable); DTC fees; and any fees associated with qualification of the Exchange Notes or Initial Notes under state securities laws.
(b) Selling Expenses Borne by Holders. Holders of the Initial Notes bear their own selling expenses incurred in connection with the sale of their Notes, including brokerage commissions, underwriting discounts (if any), transfer taxes, and their own legal fees and expenses.
(c) Initial Purchasers' Counsel Fees. For the avoidance of doubt, the expense allocation under the RRA is consistent with the provisions of the Purchase Agreement dated February 19, 2026, which requires BRB to reimburse the reasonable and documented fees and expenses of Pennfield & Associates LLP, as counsel to the Initial Purchasers, in connection with the offering of the Notes. The estimated fee for Pennfield & Associates LLP in connection with the initial offering was $275,000; any additional fees incurred by Pennfield & Associates in connection with the Exchange Offer or shelf registration will be addressed separately under the RRA's expense provisions.
10. Interaction with Other Transaction Documents
The RRA is one of several interrelated transaction documents entered into in connection with the issuance of the Notes. The engagement team should be aware of the following interactions between the RRA and the other principal transaction documents:
Purchase Agreement (dated February 19, 2026). The Purchase Agreement, entered into among BRB and the Initial Purchasers, governs the terms and conditions of the initial sale of the Notes to the Initial Purchasers. Section 5(k) of the Purchase Agreement requires, as a condition precedent to the Initial Purchasers' obligations to purchase the Notes, that BRB shall have duly executed and delivered the RRA at the Closing. In addition, the representations and warranties made by BRB in the Purchase Agreement regarding the availability of the Rule 144A exemption from registration, the absence of general solicitation, and the QIB status of the initial purchasers dovetail with, and are complementary to, the registration rights framework established by the RRA. Any breach of such representations could affect the availability of the Exchange Offer pathway and could give rise to a Shelf Trigger Event.
Indenture (dated February 24, 2026). The Indenture between BRB and Brindoval Trust Company, N.A., as Trustee, governs the terms and conditions of the Notes and will likewise govern the Exchange Notes when issued. The Indenture includes transfer restriction provisions and legend requirements applicable to the Initial Notes that expressly reference the RRA and the registration rights granted thereunder. Section 2.06 of the Indenture provides that upon consummation of the Exchange Offer, Exchange Notes will be issued without restrictive legends and will be freely transferable under the Securities Act (subject to the conditions set forth in the Exchange Offer prospectus). The Indenture further provides that the Exchange Notes will constitute the same series of debt securities as the Initial Notes and will be governed by the same terms and conditions. The engagement team should review Section 2.06 of the Indenture and the related definitions to confirm consistency with the terms of the RRA.
Offering Memorandum (dated February 19, 2026). The confidential offering memorandum prepared in connection with the initial placement of the Notes describes BRB's registration rights obligations and the Liquidated Damages provisions in the section entitled "Description of the Notes — Registration Rights." The disclosure contained in the Offering Memorandum must be consistent with the final terms of the RRA. The engagement team confirmed the consistency of such disclosure prior to the Closing; however, any post-Closing supplements to the Offering Memorandum should be reviewed against the RRA for continued accuracy.
11. Key Action Items and Docketing Recommendations
Based on the foregoing analysis, the engagement team recommends that the following action items be docketed and tracked. For each external deadline, an internal advance target date is recommended to provide a reasonable cushion against unforeseen delays.
1. Docket August 23, 2026 — Deadline to file Exchange Offer Registration Statement with SEC (180 days after Closing). Internal target date: August 1, 2026 (providing a cushion of approximately 20 calendar days). The engagement team should begin drafting the Exchange Offer Registration Statement no later than May 2026 to allow sufficient time for internal review, EDGAR formatting, and pre-filing coordination with BRB's auditors.
2. Docket November 21, 2026 — Effectiveness deadline for Exchange Offer Registration Statement (270 days after Closing). Recommendation: commence weekly status checks with the assigned SEC examiner beginning approximately 60 days after filing (estimated early October 2026). If SEC comments are received, response letters should be prepared and filed within 10 business days of receipt to maximize the likelihood of timely effectiveness.
3. Docket January 20, 2027 — Consummation deadline for Exchange Offer (330 days after Closing). Recommendation: launch the Exchange Offer (i.e., commence the offer period) no later than 30 business days before this date to allow sufficient time for the 20-business-day minimum offer period, settlement mechanics, and issuance of Exchange Notes. Working backward from January 20, 2027, the Exchange Offer should commence no later than approximately December 8, 2026 (subject to adjustment for holidays and weekends).
4. Docket February 24, 2028 — End of shelf registration effectiveness period (if applicable). This date is relevant only if a Shelf Trigger Event occurs and a shelf registration statement is filed and declared effective. If no Shelf Trigger Event occurs, this date may be removed from the docket after consummation of the Exchange Offer.
5. Coordinate with BRB Internal Stakeholders:
• Jonathan R. Talbott, Treasurer, BRB — regarding internal cash flow planning for potential Liquidated Damages exposure, DTC coordination for Exchange Note issuance, and interest payment logistics;
• Diane K. Wexler, General Counsel, BRB — regarding internal timetable for board or committee action necessary to authorize the Exchange Offer or shelf filing, including any required approval from BRFG's Board of Directors;
• BRFG Investor Relations — regarding potential market communications and disclosure obligations in connection with the Exchange Offer.
6. Coordinate with Whitmore & Lathrop, P.C. (Gregory D. Fontaine, Lead Audit Partner) regarding any comfort letter or consent requirements in connection with the Exchange Offer Registration Statement, including the scope of any required accountant's consent for incorporation of audited financial statements and the timing for delivery of such consent.
7. Coordinate with Brindoval Trust Company, N.A. (Helen M. Briggs, Corporate Trust Officer) regarding the mechanics of exchanging book-entry interests in the Initial Notes for book-entry interests in the Exchange Notes through DTC (DTC Participant No. 0447), including the preparation of all necessary ATOP (Automated Tender Offer Program) documentation and coordination with DTC's underwriting department.
8. Track All SEC Staff Comments received on the Exchange Offer Registration Statement (or any shelf registration statement) and share promptly with Pennfield & Associates LLP (Thomas R. Kessler / Nadia Volkov) and Wainwright Zanthor & Co., LLC (Douglas P. Moreno), in accordance with the notice and cooperation obligations described in Sections 3.5 and 6.3 above.
12. Conclusion
In summary, BRB's primary obligation under the Registration Rights Agreement is to complete a registered Exchange Offer for the Initial Notes within 330 days of the Closing Date (i.e., by January 20, 2027). This obligation encompasses interim milestones, including the filing of the Exchange Offer Registration Statement within 180 days (by August 23, 2026) and the achievement of effectiveness within 270 days (by November 21, 2026). Failure to meet any of these milestones constitutes a Registration Default, triggering Liquidated Damages that commence at 0.25% per annum on the $350,000,000 aggregate principal amount of the Notes and escalate in 0.25% increments every 90 days to a maximum cap of 1.00% per annum.
If the Exchange Offer cannot be completed — whether due to legal impediments, failure to achieve effectiveness, or other circumstances — BRB must file a shelf registration statement within 30 days of the applicable Shelf Trigger Event and use commercially reasonable efforts to cause such shelf registration statement to be declared effective within 90 days thereafter. The shelf registration statement must be maintained in effective and usable condition through February 24, 2028 (subject to permitted Blackout Periods).
The maximum annual Liquidated Damages exposure at the capped rate is $3,500,000, representing a meaningful incremental cost that would increase BRB's all-in coupon from 6.750% to 7.750% per annum during the default period.
The engagement team should calendar all deadlines identified in this memorandum, establish internal advance target dates with appropriate cushions, and maintain ongoing communication with BRB's General Counsel, Diane K. Wexler, and BRB's Treasurer, Jonathan R. Talbott, to ensure timely compliance with all registration obligations.
Any questions regarding this memorandum or the underlying Registration Rights Agreement should be directed to:
Claire Dempsey, Working Associate, Capital Markets — Extension 4417
Eric Johannsen, Lead Associate, Capital Markets — Extension 3892
This memorandum is a working document prepared for internal use only. It does not constitute legal advice and should not be relied upon as a substitute for review of the Registration Rights Agreement and other underlying transaction documents. All analysis is based on the terms of the RRA as executed on February 24, 2026, and applicable law as of that date.
APPENDIX A
Defined Terms Cross-Reference
The following table maps the key defined terms used in this summary memorandum to their definitions in the Registration Rights Agreement dated February 24, 2026 (the "RRA"). This cross-reference is provided for convenience only. In the event of any inconsistency between the descriptions below and the definitions as set forth in the RRA, the RRA shall control.
APPENDIX B
Copy of Executed Registration Rights Agreement
The fully executed Registration Rights Agreement dated February 24, 2026, among Belmont Ridge Bank, National Association, as issuer, and Wainwright Zanthor & Co., LLC, Redstone Capital Markets LLC, and Kensington Hale Securities Inc., as initial purchasers, is maintained in the closing binder for this transaction.
Closing Binder Reference: Calderwood & Harkness LLP Matter No. 1045-00001, Closing Binder, Tab 7.