PURCHASE AGREEMENT
$350,000,000
Belmont Ridge Bank, National Association
6.750% Fixed-to-Floating Rate Subordinated Notes due 2036
Dated: February 19, 2026
CONFIDENTIAL — This document contains confidential information regarding the private placement of the securities described herein. Distribution of this document is restricted to persons who have agreed to maintain the confidentiality of its contents.
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PURCHASE AGREEMENT
This PURCHASE AGREEMENT (this "Agreement") is dated as of February 19, 2026 (the "Pricing Date"), among:
BELMONT RIDGE BANK, NATIONAL ASSOCIATION, a national banking association duly chartered and existing under the National Bank Act, OCC Charter No. , with its principal office located at 600 Lexington Avenue, 38th Floor, New York, New York 10022 (the "Issuer" or the "Bank");
WAINWRIGHT ZANTHOR & CO., LLC, a Delaware limited liability company and a broker-dealer duly registered with the Securities and Exchange Commission under Section 15(b) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and a member of the Financial Industry Regulatory Authority, Inc. ("FINRA"), with its principal office located at 383 Madison Avenue, New York, New York 10179, acting as representative of the several initial purchasers named in Schedule I hereto (in such capacity, the "Representative");
REDSTONE CAPITAL MARKETS LLC, a Delaware limited liability company and a broker-dealer duly registered with the Securities and Exchange Commission under Section 15(b) of the Exchange Act, with its principal office located at 200 Park Avenue, Suite 4500, New York, New York 10166; and
KENSINGTON HALE SECURITIES INC., a New York corporation and a broker-dealer duly registered with the Securities and Exchange Commission under Section 15(b) of the Exchange Act, with its principal office located at One World Financial Center, Suite 2700, New York, New York 10281.
Wainwright Zanthor & Co., LLC, Redstone Capital Markets LLC, and Kensington Hale Securities Inc. are referred to collectively herein as the "Initial Purchasers."
RECITALS
WHEREAS, the Issuer proposes to issue and sell, and the Initial Purchasers propose to purchase, $350,000,000 aggregate principal amount of the Issuer's 6.750% Fixed-to-Floating Rate Subordinated Notes due 2036 (the "Notes"), on the terms and conditions set forth in this Agreement;
WHEREAS, the Notes are to be issued under an Indenture dated as of February 24, 2026 (the "Indenture"), between the Issuer and Brindoval Trust Company, National Association, a national banking association organized under the laws of the United States, as Trustee (the "Trustee"), with its Corporate Trust Office located at 100 Federal Street, Suite 800, Boston, Massachusetts 02110;
WHEREAS, the Notes are being offered and sold in a private placement exclusively to qualified institutional buyers ("QIBs") as defined in Rule 144A under the Securities Act of 1933, as amended (the "Securities Act"), in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act and Rule 144A promulgated thereunder;
WHEREAS, in connection with the offering and sale of the Notes, the Issuer has prepared (i) a Preliminary Confidential Offering Memorandum dated , 2026 (the "Preliminary Offering Memorandum"), (ii) a Pricing Term Sheet dated February 19, 2026 (the "Pricing Term Sheet"), and (iii) a final Confidential Offering Memorandum dated February 19, 2026 (the "Offering Memorandum," and together with the Preliminary Offering Memorandum and the Pricing Term Sheet, collectively, the "Offering Documents"), each describing the terms of the Notes, the offering, and the business and financial condition of the Issuer;
WHEREAS, in order to provide certain registration rights with respect to the Notes, the Issuer and the Initial Purchasers will enter into a Registration Rights Agreement dated as of the Closing Date (as defined herein) (the "Registration Rights Agreement"), pursuant to which the Issuer will agree to use commercially reasonable efforts to file an exchange offer registration statement or, in certain circumstances, a shelf registration statement with respect to the Notes; and
WHEREAS, Belmont Ridge Financial Group, Inc., a corporation duly organized and existing under the laws of the State of Delaware ("BRFG"), with its principal office at 600 Lexington Avenue, 38th Floor, New York, New York 10022, is the sole shareholder of the Issuer. For the avoidance of doubt, BRFG is NOT a party to this Agreement (except as specifically referenced herein for representational purposes), is NOT an obligor on the Notes, and does not guarantee or otherwise provide credit support for the Notes.
NOW, THEREFORE, in consideration of the mutual agreements, representations, warranties, and covenants contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
SECTION 1 — DEFINITIONS
As used in this Agreement, the following terms shall have the meanings set forth below. Capitalized terms used but not otherwise defined herein shall have the meanings ascribed to them in the Indenture.
"Applicable Time" means p.m. (New York City time) on February 19, 2026 (the Pricing Date).
"Closing Date" means February 24, 2026, or such other date as the Representative and the Issuer may mutually agree in writing, it being understood that the expected settlement cycle is T+3 from the Pricing Date.
"Closing Time" means a.m. (New York City time) on the Closing Date, or such other time on the Closing Date as the Representative and the Issuer may mutually agree.
"Commission" or "SEC" means the United States Securities and Exchange Commission.
"Disclosure Package" means the Preliminary Offering Memorandum, together with the Pricing Term Sheet and any other free writing materials or supplemental information that have been approved in writing by the Representative for use in connection with the offering of the Notes, in each case as of the Applicable Time.
"DTC" means The Depository Trust Company, a New York-chartered limited-purpose trust company and a clearing agency registered under Section 17A of the Exchange Act.
"Exchange Act" means the Securities Exchange Act of 1934, as amended, and the rules and regulations of the Commission promulgated thereunder.
"FINRA" means the Financial Industry Regulatory Authority, Inc.
"Global Note" means the Rule 144A Global Note in fully registered form, without interest coupons, representing the Notes in an aggregate principal amount of $350,000,000, to be held through the facilities of DTC, with Cede & Co. as nominee of DTC.
"Indenture" has the meaning set forth in the preamble hereto.
"Initial Purchaser Information" means any information furnished in writing by any Initial Purchaser to the Issuer expressly for use in the preparation of the Offering Documents or any amendment or supplement thereto.
"Initial Purchasers' Counsel" means Pennfield & Associates LLP, 1585 Broadway, 30th Floor, New York, New York 10036.
"Investment Company Act" means the Investment Company Act of 1940, as amended, and the rules and regulations of the Commission promulgated thereunder.
"Material Adverse Change" or "Material Adverse Effect" means any change, development, event, circumstance, occurrence, condition, or effect that, individually or in the aggregate, is or would reasonably be expected to be material and adverse to (a) the business, assets, properties, liabilities, financial condition, results of operations, or prospects of the Issuer and its subsidiaries, taken as a whole, (b) the ability of the Issuer to perform its obligations under the Transaction Documents, (c) the validity or enforceability of any Transaction Document, or (d) the rights or remedies of the Initial Purchasers or the holders of the Notes under the Transaction Documents; provided, however, that changes in general economic or market conditions, changes in prevailing interest rates, or changes in banking laws or regulations of general applicability (in each case, to the extent not disproportionately affecting the Issuer relative to other comparable national banking associations) shall not, in and of themselves, constitute a Material Adverse Change.
"Notes" has the meaning set forth in the preamble hereto and refers to the $350,000,000 aggregate principal amount of the Issuer's 6.750% Fixed-to-Floating Rate Subordinated Notes due 2036 to be issued under the Indenture.
"OCC" means the Office of the Comptroller of the Currency, an independent bureau within the United States Department of the Treasury.
"Offering Documents" has the meaning set forth in the preamble hereto.
"Offering Memorandum" has the meaning set forth in the preamble hereto.
"Preliminary Offering Memorandum" has the meaning set forth in the preamble hereto.
"Pricing Term Sheet" has the meaning set forth in the preamble hereto.
"QIB" means a qualified institutional buyer as defined in Rule 144A under the Securities Act.
"Registration Rights Agreement" has the meaning set forth in the preamble hereto.
"Rule 144A" means Rule 144A under the Securities Act.
"Securities Act" means the Securities Act of 1933, as amended, and the rules and regulations of the Commission promulgated thereunder.
"Transaction Documents" means, collectively, this Agreement, the Indenture, the Notes, the Registration Rights Agreement, and any and all other agreements, instruments, certificates, or documents executed or delivered in connection with the transactions contemplated hereby or thereby.
"Transfer Restrictions" means the restrictions on transfer applicable to the Notes as described in the Offering Memorandum under the heading "Transfer Restrictions," including, without limitation, the requirement that the Notes may only be transferred to QIBs in accordance with Rule 144A or pursuant to another exemption from, or in a transaction not subject to, the registration requirements of the Securities Act.
"Trustee" has the meaning set forth in the preamble hereto.
SECTION 2 — PURCHASE AND SALE OF THE NOTES
Section 2.1 — Agreement to Purchase and Sell
Subject to the terms and conditions set forth herein, and on the basis of the representations, warranties, and covenants herein contained, the Issuer agrees to issue and sell to each of the Initial Purchasers, and each Initial Purchaser agrees, severally and not jointly, to purchase from the Issuer, on the Closing Date, the aggregate principal amount of Notes set forth opposite such Initial Purchaser's name in Schedule I hereto, at a purchase price equal to of the aggregate principal amount of Notes purchased by such Initial Purchaser.
The aggregate principal amount of Notes to be issued and sold hereunder is $350,000,000. The purchase price per Note is of the principal amount thereof. The aggregate purchase price for all Notes to be purchased by the Initial Purchasers is calculated as follows:
$350,000,000 × (aggregate purchase price payable to the Issuer)
The initial purchasers' discount of 0.650% of par represents the difference between the issue price to investors and the purchase price payable to the Issuer. The initial purchasers' discount is allocated among the Initial Purchasers in the amounts and percentages set forth in Schedule I hereto and in Section 9.2 of this Agreement. Each Initial Purchaser's obligation to purchase Notes is several and not joint, and no Initial Purchaser shall be obligated to purchase any Notes that another Initial Purchaser has failed or refused to purchase.
Section 2.2 — Payment and Delivery
On the Closing Date, payment of the aggregate purchase price of shall be made by the Initial Purchasers to the Issuer by wire transfer of immediately available funds in United States dollars, to the account designated by the Issuer in writing to the Representative not later than 5:00 p.m. (New York City time) on the business day immediately preceding the Closing Date. Wire transfer instructions shall be set forth in the Closing Funds Flow Memorandum to be delivered by the Issuer pursuant to Section 8.22 hereof.
Against receipt of such payment, the Issuer shall cause the Trustee to deliver, for the account of the Initial Purchasers, the Global Note representing $350,000,000 aggregate principal amount of Notes in book-entry form through the facilities of DTC, registered in the name of Cede & Co. as nominee of DTC. The Global Note shall be delivered to DTC or its custodian in accordance with DTC's customary procedures for same-day funds settlement, and crediting of the applicable principal amounts to the respective accounts of the Initial Purchasers (or their respective DTC participant accounts) shall constitute delivery of the Notes hereunder.
The closing (the "Closing") shall take place at the offices of , or remotely by electronic exchange of documents and signatures, at the Closing Time on the Closing Date, unless another time or place is agreed upon in writing by the Representative and the Issuer. At the Closing, each of the deliveries contemplated by Section 8 hereof shall be made, and the execution and delivery of a cross-receipt evidencing the exchange of the Notes for payment shall be completed.
Section 2.3 — Denominations
The Notes shall be issued in minimum denominations of and integral multiples of $1,000 in excess thereof. No Note shall be issued or transferred in a principal amount of less than .
SECTION 3 — DESCRIPTION OF THE NOTES (SUMMARY OF TERMS)
The following is a summary of the principal terms of the Notes. This summary is qualified in its entirety by reference to the detailed provisions of the Indenture and the form of the Notes, and in the event of any inconsistency between this summary and the Indenture, the Indenture shall control.
Instrument: 6.750% Fixed-to-Floating Rate Subordinated Notes due 2036.
Issuer: Belmont Ridge Bank, National Association.
Aggregate Principal Amount: $350,000,000.
Maturity Date: March 1, 2036, unless earlier redeemed in accordance with the terms of the Notes and the Indenture.
Fixed Rate Period: From and including February 24, 2026, to but excluding March 1, 2031 (the "Fixed Rate Period"), the Notes shall bear interest at a fixed rate of 6.750% per annum. Interest during the Fixed Rate Period shall be payable semi-annually in arrears on March 1 and September 1 of each year, commencing September 1, 2026. Interest during the Fixed Rate Period shall be computed on the basis of a 360-day year consisting of twelve 30-day months.
Floating Rate Period: From and including March 1, 2031, to but excluding March 1, 2036 (the "Floating Rate Period"), the Notes shall bear interest at a floating rate equal to plus 275 basis points (2.75%) per annum, subject to the SOFR fallback provisions set forth in the Indenture. Interest during the Floating Rate Period shall be payable quarterly in arrears on March 1, June 1, September 1, and December 1 of each year, commencing June 1, 2031. Interest during the Floating Rate Period shall be computed on the basis of a 360-day year and the actual number of days elapsed.
Fixed-to-Floating Rate Reset Date: March 1, 2031 (the "Reset Date").
Optional Redemption: The Issuer may, at its option, redeem the Notes, in whole or in part, at a redemption price equal to 100% of the principal amount of the Notes being redeemed, plus accrued and unpaid interest thereon to, but excluding, the redemption date, on any date on or after March 1, 2031 (the Reset Date), subject in each case to the prior receipt of OCC approval (or such other regulatory approval as may then be required). In addition, the Issuer may, at its option, redeem the Notes in whole (but not in part) at any time upon the occurrence of a Tax Event or a Regulatory Capital Treatment Event (each as defined in the Indenture), at a redemption price equal to 100% of the principal amount of the Notes being redeemed, plus accrued and unpaid interest thereon to, but excluding, the redemption date, subject in each case to the prior receipt of OCC approval. Any partial redemption of the Notes shall be effected on a pro rata basis or by lot or by such other method as DTC may require.
Ranking: The Notes constitute direct, unsecured, subordinated obligations of the Issuer. The Notes shall at all times:
(a) rank junior in right of payment to all existing and future Senior Indebtedness (as defined in the Indenture) of the Issuer, including all deposit liabilities of the Issuer and all obligations to general creditors of the Issuer;
(b) rank pari passu in right of payment with the Issuer's existing 5.250% Subordinated Notes due 2027 (of which $200,000,000 aggregate principal amount is currently outstanding, issued on November 15, 2017, under a separate indenture dated as of November 15, 2017, between the Issuer and Brindoval Trust Company, National Association, as trustee) and with any other existing and future subordinated indebtedness of the Issuer that is not expressly stated to rank junior to the Notes; and
(c) rank senior in right of payment to any existing and future junior subordinated indebtedness of the Issuer and to all classes of the Issuer's equity securities.
Form: The Notes shall be issued in book-entry only form, represented by one or more Global Notes deposited with, or on behalf of, DTC and registered in the name of Cede & Co. as nominee of DTC. Beneficial interests in the Global Notes shall be shown on, and transfers thereof shall be effected only through, records maintained by DTC and its participants.
CUSIP: 082651 AB7.
Trustee, Paying Agent, Registrar, and Transfer Agent: Brindoval Trust Company, National Association.
Governing Law: The Indenture and the Notes shall be governed by and construed in accordance with the laws of the State of New York.
SECTION 4 — REPRESENTATIONS AND WARRANTIES OF THE ISSUER
The Issuer hereby represents and warrants to each Initial Purchaser, as of the date of this Agreement and as of the Closing Date (except as otherwise expressly stated herein), as follows:
Section 4.1 — Organization and Good Standing
The Issuer is a national banking association duly organized, validly existing, and in good standing under the National Bank Act, as evidenced by OCC Charter No. . The Issuer has full corporate power and authority under the National Bank Act, its Articles of Association, and its Bylaws to own, lease, and operate its properties and to conduct its business as presently conducted and as described in the Offering Memorandum, and to enter into, execute, deliver, and perform its obligations under each of the Transaction Documents to which it is a party. The Issuer is duly authorized, licensed, and qualified to do business in each jurisdiction in which the nature of its business or the ownership, leasing, or operation of its properties requires such authorization, licensing, or qualification, except where the failure to be so authorized, licensed, or qualified would not, individually or in the aggregate, have a Material Adverse Effect.
Section 4.2 — Parent Holding Company
Section 4.3 — Authorization
The issuance, sale, and delivery of the Notes, the execution, delivery, and performance of this Agreement, the Indenture, the Registration Rights Agreement, and each other Transaction Document to which the Issuer is a party, and the consummation of the transactions contemplated hereby and thereby, have been duly authorized by all necessary corporate action on the part of the Issuer, including, without limitation, approval by the Board of Directors of the Issuer at a duly convened meeting or by unanimous written consent. No further corporate action or approval on the part of the Issuer or its shareholder is necessary in connection with the foregoing.
Section 4.4 — Execution and Delivery; Enforceability
This Agreement has been duly executed and delivered by the Issuer and constitutes a valid and binding obligation of the Issuer, enforceable against the Issuer in accordance with its terms, except as such enforceability may be limited by (a) applicable bankruptcy, insolvency, reorganization, receivership, conservatorship, moratorium, fraudulent conveyance, fraudulent transfer, or similar laws now or hereafter in effect affecting the enforcement of creditors' rights generally, (b) general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law), (c) requirements of reasonableness, good faith, and fair dealing, and (d) the power of the OCC and the FDIC to appoint a receiver or conservator for the Issuer and the rights and powers of such receiver or conservator under 12 U.S.C. § 1821(e) and related statutory provisions (collectively, the "Enforceability Exceptions"). On the Closing Date, each of the Indenture, the Notes, and the Registration Rights Agreement will have been duly executed and delivered by the Issuer (and, in the case of the Notes, duly authenticated by the Trustee) and will constitute a valid and binding obligation of the Issuer, enforceable against the Issuer in accordance with its terms, subject to the Enforceability Exceptions.
Section 4.5 — No Conflicts
The execution, delivery, and performance by the Issuer of the Transaction Documents and the issuance, sale, and delivery of the Notes will not, and the consummation of the transactions contemplated hereby and thereby will not:
(a) violate or conflict with the Articles of Association or Bylaws of the Issuer;
(b) violate or conflict with any applicable law, statute, rule, regulation, judgment, order, injunction, or decree of any federal, state, or local court or governmental authority having jurisdiction over the Issuer, including, without limitation, the OCC, the FDIC, and the Federal Reserve;
(c) result in a breach of, constitute a default or an event of default (or an event that, with notice or lapse of time or both, would become a default or event of default) under, give rise to any right of termination, amendment, cancellation, or acceleration under, or result in the loss of any benefit under, any agreement, contract, indenture, mortgage, loan agreement, note, lease, license, or other instrument to which the Issuer is a party or by which the Issuer or any of its properties or assets is bound; or
(d) result in the creation or imposition of any lien, charge, pledge, encumbrance, or security interest upon any of the Issuer's properties or assets under any such agreement, contract, or instrument.
Section 4.6 — Governmental Approvals
Section 4.7 — Offering Documents
(a) The Offering Memorandum, as of its date (February 19, 2026) and as of the Closing Date, does not and will not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.
(b) The Disclosure Package, as of the Applicable Time, did not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.
(c) The Preliminary Offering Memorandum, as of its date (February 14, 2026), did not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided, however, that this representation shall not apply to information relating to the final pricing terms of the Notes that were left blank or incomplete in the Preliminary Offering Memorandum and subsequently set forth in the Pricing Term Sheet.
(d) Each of the Offering Documents conforms, and at the Closing Date will conform, in all material respects to the requirements of Rule 144A and applicable law, and neither the Issuer nor any person acting on its behalf has provided to any prospective purchaser of the Notes any written communication in connection with the offering of the Notes other than the Offering Documents or materials approved in writing by the Representative.
(e) The representations and warranties set forth in this Section 4.7 shall not apply to statements or omissions made in the Offering Documents in reliance upon and in conformity with Initial Purchaser Information.
Section 4.8 — Financial Statements
(a) The audited financial statements of the Issuer and the audited consolidated financial statements of BRFG and its subsidiaries included or incorporated by reference in the Offering Memorandum present fairly, in all material respects, the financial position of the Issuer and the consolidated financial position of BRFG and its subsidiaries, respectively, as of , and the results of their operations, changes in shareholders' equity, and cash flows for the periods indicated therein, in conformity with generally accepted accounting principles in the United States ("GAAP") applied on a consistent basis throughout the periods presented, except as otherwise noted therein, and in conformity with applicable regulatory accounting principles as prescribed by the OCC.
(b) The unaudited interim financial statements of the Issuer and the unaudited interim consolidated financial statements of BRFG and its subsidiaries included or incorporated by reference in the Offering Memorandum have been prepared on a basis consistent with the audited financial statements referred to in clause (a) above (subject to normal year-end audit adjustments and the absence of footnotes required by GAAP) and present fairly, in all material respects, the financial position and results of operations of the Issuer and the consolidated group for the interim periods indicated.
Since December 31, 2025 (the date of the most recent balance sheet included in the Offering Memorandum), there has not occurred any Material Adverse Change, and no event, development, or circumstance has occurred that would reasonably be expected to result in a Material Adverse Change.
Section 4.9 — Capital Adequacy
(a) As of December 31, 2025, the Issuer's regulatory capital ratios were as follows:
(c) The Notes are intended to qualify, and the Issuer has no reason to believe the Notes will not qualify, as Tier 2 capital of the Issuer under 12 C.F.R. Part 3, subject to the applicable 20% annual amortization during the final five years prior to the stated maturity date and any other applicable limitations or phase-out provisions.
(d) After giving effect to the issuance of the Notes and the receipt of the net proceeds thereof, the Issuer expects to remain "well-capitalized" under the OCC's Prompt Corrective Action regulations and in compliance with all applicable capital adequacy requirements.
Section 4.10 — Existing Subordinated Debt
Section 4.11 — Compliance with Laws; Regulatory Matters
(a) The Issuer is in compliance, in all material respects, with all applicable laws, statutes, rules, regulations, orders, directives, and guidance of the OCC, the FDIC, the Federal Reserve, and all other applicable governmental and regulatory authorities, including, without limitation, the National Bank Act, the Federal Deposit Insurance Act, the Bank Secrecy Act, and all regulations promulgated thereunder.
(b) The Issuer has timely filed all required Reports of Condition and Income (Call Reports) with the OCC and the FDIC and all other regulatory filings required to be made by the Issuer with any governmental authority, and all such filings were true, complete, and correct in all material respects when filed (or, if amended, as of the date of such amendment).
(c) As of the date hereof,
Section 4.12 — Litigation
There is no action, suit, proceeding, investigation, claim, or governmental inquiry pending or, to the knowledge of the Issuer, threatened against the Issuer or any of its subsidiaries, or against any of their respective directors, officers, or properties, before any court, arbitral tribunal, governmental authority, or regulatory body that (a) is or would reasonably be expected to be material to the Issuer and its subsidiaries, taken as a whole, (b) seeks to restrain, enjoin, prevent the consummation of, or otherwise challenge the transactions contemplated by the Transaction Documents, or (c) questions the validity, binding effect, or enforceability of any Transaction Document or the Notes. The Issuer is not a party to any settlement agreement, decree, or order that would have a Material Adverse Effect.
Section 4.13 — Tax Matters
(a) The Issuer and each of its subsidiaries have timely filed (taking into account any applicable extensions) all material tax returns required to be filed with the appropriate taxing authorities in all jurisdictions in which such returns are required to be filed, and all such returns are true, correct, and complete in all material respects. The Issuer and each of its subsidiaries have paid all material taxes, assessments, fees, and other governmental charges that are due and payable (whether or not shown on any tax return), and no material deficiencies or adjustments have been asserted or assessed against the Issuer or any of its subsidiaries that remain unpaid. There are no material tax liens (other than statutory liens for taxes not yet due and payable) outstanding against any property or asset of the Issuer or any of its subsidiaries.
(b) The Notes are intended to be characterized as indebtedness of the Issuer for U.S. federal income tax purposes, and the Issuer will treat, and intends to report, the Notes as indebtedness for all U.S. federal, state, and local income tax purposes. The Issuer is not aware of any facts or circumstances that would cause the Notes to be recharacterized as equity for U.S. federal income tax purposes.
Section 4.14 — Investment Company Act
The Issuer is not, and after giving effect to the offering, sale, and delivery of the Notes and the application of the net proceeds thereof as described in the Offering Memorandum, will not be, an "investment company" or a company "controlled" by an "investment company" within the meaning of the Investment Company Act of 1940, as amended, and the rules and regulations promulgated thereunder. The Issuer is exempt from the definition of "investment company" as a bank within the meaning of Section 3(c)(3) of the Investment Company Act.
Section 4.15 — No General Solicitation
Neither the Issuer nor any person acting on its behalf (other than the Initial Purchasers, as to whom the Issuer makes no representation) has offered or sold the Notes by means of any "general solicitation" or "general advertising" within the meaning of Rule 502(c) under Regulation D of the Securities Act, including, without limitation, any advertisement, article, notice, or other communication published in any newspaper, magazine, website, or similar medium, or broadcast over television or radio, or any seminar or meeting whose attendees were invited by any general solicitation or general advertising.
Section 4.16 — Rule 144A Eligibility
The Notes are eligible for resale pursuant to Rule 144A under the Securities Act. The Notes are not of the same class (within the meaning of Rule 144A(d)(3)(i)) as securities that, at the time of the offering, are listed on a national securities exchange registered under Section 6 of the Exchange Act or quoted in a U.S. automated inter-dealer quotation system. The Issuer covenants that, for so long as the Notes remain outstanding as "restricted securities" within the meaning of Rule 144(a)(3) under the Securities Act, the Issuer will, upon the request of a holder or beneficial owner of Notes or a prospective purchaser designated by a holder or beneficial owner, promptly furnish to such holder, beneficial owner, or prospective purchaser the information specified in, and meeting the requirements of, Rule 144A(d)(4) under the Securities Act.
Section 4.17 — No Directed Selling Efforts
Neither the Issuer nor any person acting on its behalf has engaged in any "directed selling efforts" within the meaning of Regulation S under the Securities Act with respect to the Notes.
Section 4.18 — ERISA
Neither the Issuer nor any of its "ERISA Affiliates" (within the meaning of Section 414(b), (c), (m), or (o) of the Internal Revenue Code of 1986, as amended) has incurred or reasonably expects to incur any liability under Title IV of the Employee Retirement Income Security Act of 1974, as amended ("ERISA"), or the penalty or excise tax provisions of the Internal Revenue Code relating to employee benefit plans, and no "reportable event" (within the meaning of Section 4043 of ERISA and the regulations thereunder) or "prohibited transaction" (within the meaning of Section 4975 of the Internal Revenue Code or Section 406 of ERISA) has occurred or is reasonably expected to occur with respect to any "employee benefit plan" (within the meaning of Section 3(3) of ERISA) maintained, contributed to, or required to be contributed to by the Issuer or any ERISA Affiliate, that, in any such case, would have a Material Adverse Effect.
Section 4.19 — Use of Proceeds
The net proceeds of the offering (estimated at approximately $345,700,000 after deducting the initial purchasers' discount of $2,275,000 and estimated offering expenses of approximately $1,150,000) will be used for The Issuer shall apply the net proceeds from the sale of the Notes substantially as described under the heading "Use of Proceeds" in the Offering Memorandum.
Section 4.20 — Independent Auditors
Section 4.21 — Ratings
As of the date hereof, no downgrade, withdrawal, suspension, or negative change in any such rating is pending or, to the Issuer's knowledge, threatened by either Meridian Ratings Group, Inc. or Archer Bond Analytics LLC, and neither such rating agency has placed any rating assigned to the Notes or any other debt securities of the Issuer on review for possible downgrade, withdrawal, or negative change.
Section 4.22 — DTC Eligibility
The Notes are eligible for clearance and settlement through the book-entry system of DTC. The Issuer has received confirmation from DTC that the Notes have been accepted for clearance and settlement through DTC's Same-Day Funds Settlement System, subject to compliance with DTC's customary procedures for new issues.
Section 4.23 — Anti-Money Laundering / BSA Compliance
The Issuer is in compliance, in all material respects, with the Bank Secrecy Act of 1970, as amended (the "BSA," codified at 31 U.S.C. §§ 5311–5332 and 12 U.S.C. §§ 1818(s), 1829b), and all regulations promulgated thereunder by the Financial Crimes Enforcement Network ("FinCEN"), including, without limitation, the customer identification program, suspicious activity reporting, and currency transaction reporting requirements applicable to national banks. The Issuer maintains a BSA/anti-money laundering compliance program that meets the requirements of 31 C.F.R. § 1020.210. The Issuer is in compliance, in all material respects, with all applicable sanctions laws, executive orders, and regulations administered and enforced by the U.S. Department of the Treasury's Office of Foreign Assets Control ("OFAC"), including the requirement that the Issuer not transact with, or provide services to, any person or entity listed on OFAC's Specially Designated Nationals and blocked Persons List or any other sanctions list maintained by OFAC. The Issuer has not been the subject of any BSA/AML enforcement action, consent order, or civil money penalty assessment by the OCC, FinCEN, or any other governmental authority during the five-year period preceding the date hereof.
Section 4.24 — Cybersecurity
(a) The Issuer maintains information technology systems, networks, and data security programs that are reasonably designed to protect the confidentiality, integrity, and availability of the Issuer's information systems and the non-public personal information of its customers, in compliance in all material respects with all applicable federal and state privacy and data security laws, regulations, and guidance, including the Gramm-Leach-Bliley Act and the OCC's guidelines establishing information security standards for national banks (12 C.F.R. Part 30, Appendix B).
(b)
Section 4.25 — Environmental Matters
Neither the Issuer nor any of its subsidiaries has any material liability or material contingent liability arising under or relating to any applicable federal, state, or local environmental law, regulation, or common law, including, without limitation, the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 ("CERCLA"), the Resource Conservation and Recovery Act, or any state analogue thereof, whether as an owner or operator of any real property or otherwise, that would have a Material Adverse Effect. To the Issuer's knowledge, there are no pending or threatened claims, actions, or proceedings under any environmental law against the Issuer or any of its subsidiaries that would have a Material Adverse Effect.
SECTION 5 — REPRESENTATIONS AND WARRANTIES OF THE INITIAL PURCHASERS
Each Initial Purchaser, severally and not jointly, hereby represents and warrants to the Issuer as of the date of this Agreement and as of the Closing Date as follows:
Section 5.1 — Organization and Authority
Such Initial Purchaser is duly organized, validly existing, and in good standing under the laws of its jurisdiction of organization and has full corporate or limited liability company power and authority to enter into this Agreement and to perform its obligations hereunder. The execution, delivery, and performance of this Agreement by such Initial Purchaser have been duly authorized by all necessary corporate or limited liability company action on the part of such Initial Purchaser. This Agreement has been duly executed and delivered by such Initial Purchaser and constitutes a valid and binding obligation of such Initial Purchaser, enforceable against such Initial Purchaser in accordance with its terms, subject to the Enforceability Exceptions. Such Initial Purchaser is duly registered as a broker-dealer with the SEC under Section 15(b) of the Exchange Act and is a member in good standing of FINRA.
Section 5.2 — Rule 144A Compliance
Such Initial Purchaser represents and agrees that it will offer and sell the Notes only to persons whom it reasonably believes to be QIBs, as defined in Rule 144A under the Securities Act, in transactions meeting the requirements of Rule 144A, and in compliance with all applicable federal and state securities laws. Such Initial Purchaser further represents that, in connection with any such offer or sale, it will deliver to each purchaser the Offering Memorandum (or, if the Offering Memorandum is not yet available, the Disclosure Package) prior to or concurrently with the confirmation of sale, and will inform each purchaser that the Notes have not been registered under the Securities Act and that the Notes may be resold only in compliance with Rule 144A or another applicable exemption from the registration requirements of the Securities Act.
Section 5.3 — No Regulation S Sales
Such Initial Purchaser represents and agrees that it has not offered and will not offer or sell the Notes outside the United States or to any person other than a QIB purchasing in the United States. The offering and sale of the Notes is a domestic-only offering. No Regulation S tranche is being offered in connection with this offering, and such Initial Purchaser has not made, and will not make, any offers or sales of the Notes in an "offshore transaction" within the meaning of Regulation S under the Securities Act.
SECTION 6 — COVENANTS OF THE ISSUER
The Issuer covenants and agrees with each Initial Purchaser as follows:
Section 6.1 — Delivery of Offering Memorandum
The Issuer will furnish, or cause to be furnished, to the Initial Purchasers and their counsel, without charge, as many printed or electronic copies of the Offering Memorandum (and any amendments or supplements thereto) as the Representative may reasonably request for use in connection with the offering, marketing, and resale of the Notes. The Issuer will make available to the Initial Purchasers copies of the Offering Memorandum for delivery to purchasers not later than the business day prior to the Closing Date.
Section 6.2 — Amendments and Supplements
(a) No amendment or supplement to the Offering Memorandum (or to any other Offering Document) shall be made by the Issuer without the prior written consent of the Representative, which consent shall not be unreasonably withheld, conditioned, or delayed.
(b) If at any time prior to the completion of the resale of the Notes by the Initial Purchasers (which shall be presumed to have occurred upon the earlier of (i) the date on which each Initial Purchaser has notified the Issuer that it has completed the distribution of its allotment of Notes or (ii) sixty (60) days after the Closing Date), any event occurs, or any condition exists, as a result of which the Offering Memorandum, as then amended or supplemented, would contain an untrue statement of a material fact, or would omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading, or if it is necessary at any time to amend or supplement the Offering Memorandum to comply with applicable law, the Issuer will (i) promptly notify the Representative of such event or condition and (ii) promptly prepare and furnish, at the Issuer's expense, an amendment or supplement to the Offering Memorandum in form and substance satisfactory to the Representative that will correct such untrue statement or omission or effect such compliance.
Section 6.3 — Blue Sky Compliance
The Issuer will cooperate with the Initial Purchasers and Initial Purchasers' Counsel, and will use commercially reasonable efforts, to qualify or register the Notes for offer and sale under the applicable securities or "blue sky" laws of such jurisdictions as the Representative may reasonably request; provided, however, that the Issuer shall not be required to (a) qualify as a foreign corporation or banking institution in any jurisdiction in which it is not so qualified or subject itself to taxation in any such jurisdiction, or (b) file a general consent to service of process in any jurisdiction. The Issuer represents that the Notes are "covered securities" within the meaning of Section 18(b)(4)(D) of the Securities Act, and accordingly state securities law registration or qualification should not be required. The Issuer will advise the Representative promptly of the receipt of any notification with respect to the suspension of any such qualification and, if any such qualification is suspended, will use commercially reasonable efforts to have the qualification reinstated as promptly as practicable.
Section 6.4 — Rule 144A Information
For so long as any of the Notes remain outstanding as "restricted securities" within the meaning of Rule 144(a)(3) under the Securities Act, the Issuer will, unless it has become a reporting company under Section 13 or 15(d) of the Exchange Act and is current in its reporting obligations thereunder, make available, upon the request of a holder or beneficial owner of Notes or a prospective purchaser designated by such holder or beneficial owner, the information specified in, and meeting the requirements of, Rule 144A(d)(4) under the Securities Act. Such information shall include the information concerning the Issuer that would be required to be provided by Rule 144A(d)(4)(i) if the Issuer is not a reporting company at such time.
Section 6.5 — Listing
The Issuer does not intend to apply for the listing of the Notes on any securities exchange or automated quotation system. This Section 6.5 is included for the avoidance of doubt and does not impose any affirmative obligation upon the Issuer.
Section 6.6 — DTC
The Issuer will cooperate with the Trustee and DTC to maintain the eligibility of the Notes for clearance and settlement through the book-entry system of DTC. The Issuer will cause the Trustee to maintain its status as a DTC participant and to comply with DTC's applicable rules and procedures. In the event that DTC is at any time unwilling or unable to continue as depository for the Global Note, the Issuer will use commercially reasonable efforts to appoint a successor depository or, if no successor depository is available, to issue the Notes in definitive certificated form as provided in the Indenture.
Section 6.7 — Use of Proceeds
The Issuer shall apply the net proceeds from the sale of the Notes substantially as described under the heading "Use of Proceeds" in the Offering Memorandum. No portion of the net proceeds will be used, directly or indirectly, to purchase or carry any "margin security" within the meaning of Regulation U of the Federal Reserve or for any purpose that would violate Regulation T, U, or X of the Federal Reserve.
Section 6.8 — No Stabilization
Neither the Issuer nor any affiliate of the Issuer will take, directly or indirectly, any action designed to, or that would constitute or that might reasonably be expected to cause or result in, the stabilization or manipulation of the price of any securities of the Issuer, or any securities the price of which is used to determine the value of the Notes, in violation of Regulation M under the Exchange Act or otherwise in contravention of applicable law.
Section 6.9 — Regulatory Filings
Section 6.10 — Registration Rights
On the Closing Date, the Issuer will enter into the Registration Rights Agreement with the Initial Purchasers, substantially in the form attached hereto as an exhibit or otherwise agreed upon by the parties. From and after the Closing Date, the Issuer will comply with all of its obligations under the Registration Rights Agreement, including, without limitation, the obligation to use commercially reasonable efforts to file and cause to become effective an exchange offer registration statement (or, if required, a shelf registration statement) with the Commission within the time periods specified in the Registration Rights Agreement, and to pay additional interest on the Notes in the event of a registration default as described therein.
Section 6.11 — Integration
The Issuer will not, and will cause its affiliates not to, sell, offer for sale, or solicit offers to buy, or otherwise negotiate in respect of, any security (as defined in the Securities Act) the offering of which would be integrated with the offering of the Notes in a manner that would require registration of the Notes under the Securities Act or qualification of the Indenture under the TIA.
SECTION 7 — COVENANTS OF THE INITIAL PURCHASERS
Each Initial Purchaser, severally and not jointly, covenants and agrees with the Issuer as follows:
Section 7.1 — Offering Restrictions
Such Initial Purchaser covenants that it will offer and sell the Notes only to persons whom it reasonably believes to be QIBs in reliance on Rule 144A under the Securities Act and in accordance with all applicable federal and state securities laws. Such Initial Purchaser will deliver to each purchaser of Notes the Offering Memorandum (or, if the Offering Memorandum is not yet available, the Disclosure Package) prior to or concurrently with the delivery of the confirmation of sale to such purchaser. Such Initial Purchaser will use its commercially reasonable efforts to ensure that all resales of the Notes by such Initial Purchaser are effected in compliance with Rule 144A and applicable law.
Section 7.2 — Transfer Restrictions
Such Initial Purchaser will inform each purchaser of the Notes of the Transfer Restrictions applicable to the Notes as described in the Offering Memorandum, including, without limitation, that (a) the Notes have not been registered under the Securities Act and may not be resold except in compliance with Rule 144A or another available exemption from, or in a transaction not subject to, the registration requirements of the Securities Act, (b) the Notes may only be issued and transferred in minimum denominations of $150,000 and integral multiples of $1,000 in excess thereof, and (c) the Global Note representing the Notes will bear a restrictive legend to the effect described in the Offering Memorandum.
Section 7.3 — No General Solicitation
No Initial Purchaser will offer or sell the Notes by means of any form of "general solicitation" or "general advertising" within the meaning of Rule 502(c) under Regulation D of the Securities Act, including, without limitation, by means of any advertisement, article, notice, or other communication published in any newspaper, magazine, website, or similar medium, or broadcast over television, radio, or the internet, or by means of any seminar or meeting whose attendees have been invited by any general solicitation or general advertising.
SECTION 8 — CONDITIONS TO THE OBLIGATIONS OF THE INITIAL PURCHASERS
The respective obligations of each Initial Purchaser to purchase and pay for the Notes on the Closing Date shall be subject to the accuracy and completeness of the representations and warranties of the Issuer herein, to the performance by the Issuer of its covenants and obligations hereunder, and to the satisfaction (or written waiver by the Representative on behalf of the Initial Purchasers) of each of the following conditions on or before the Closing Date:
Section 8.1 — Representations and Warranties True
The representations and warranties of the Issuer set forth in Section 4 of this Agreement shall be true and correct in all material respects (or, where already qualified by materiality, Material Adverse Change, or Material Adverse Effect, true and correct in all respects) as of the Closing Date with the same force and effect as though expressly made on and as of the Closing Date (except to the extent any such representation or warranty expressly relates to an earlier date, in which case such representation or warranty shall be true and correct in all material respects as of such earlier date).
Section 8.2 — Performance of Covenants
The Issuer shall have performed and complied in all material respects with all of its obligations, covenants, and agreements required to be performed or complied with under this Agreement at or prior to the Closing Date.
Section 8.3 — No Material Adverse Change
Since the date of the most recent financial statements of the Issuer included in the Offering Memorandum (i.e., December 31, 2025), there shall not have occurred any Material Adverse Change in the business, assets, properties, liabilities, financial condition, results of operations, or prospects of the Issuer or BRFG and its subsidiaries, taken as a whole, and no event, development, or condition shall have occurred that would reasonably be expected to result in a Material Adverse Change.
Section 8.4 — Officer's Certificate
The Issuer shall have delivered to the Representative a certificate dated the Closing Date, substantially in the form attached hereto as Exhibit A, signed by , certifying on behalf of the Issuer that: (a) the representations and warranties of the Issuer set forth in this Agreement are true and correct in all material respects as of the Closing Date (except as otherwise expressly stated herein); (b) the Issuer has performed and complied in all material respects with all of its obligations, covenants, and agreements required to be performed or complied with under this Agreement at or prior to the Closing Date; and (c) since December 31, 2025, there has not occurred any Material Adverse Change.
Section 8.5 — Secretary's Certificate
The Issuer shall have delivered to the Representative a certificate dated the Closing Date, substantially in the form attached hereto as Exhibit B, signed by , attaching true and correct copies of, and certifying as to: (i) the Articles of Association / Charter of the Issuer (OCC Charter No. 18742) as currently in effect; (ii) the Amended and Restated Bylaws of the Issuer as currently in effect; (iii) the resolutions duly adopted by the Board of Directors of the Issuer authorizing the offering, issuance, and sale of the Notes and the execution, delivery, and performance of the Transaction Documents; and (iv) the incumbency and specimen signatures of each officer of the Issuer authorized to execute and deliver the Transaction Documents on behalf of the Issuer.
Section 8.6 — Legal Opinion of Issuer's Counsel (Corporate/Securities)
Calderwood & Harkness LLP shall have delivered to the Representative its written opinion, dated the Closing Date and addressed to each of the Initial Purchasers, substantially in the form attached hereto as Exhibit C, opining as to the following matters, :
Such opinion shall be subject to customary assumptions, qualifications, and exceptions, and shall be in form and substance satisfactory to the Representative and Initial Purchasers' Counsel.