FORWARD -LOOKING STATEMENTS

 

This prospectus-proxy statement and all attachments hereto, including the annual report and audited financial statements of New Century Bank, as well as other written or oral communications made from time to time by New Century Bank or Customers 1st Bancorp, Inc., may contain certain forward-looking information within the meaning of the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended.  These statements relate to future events or future predictions, including events or predictions relating to our future financial performance, and are generally identifiable by the use of forward-looking terminology such as “believes,” “expects,” “may,” “will,” “should,” “plan,” “intend,” or “anticipates” or the negative thereof or comparable terminology, or by discussion of strategy that involve risks and uncertainties.  These forward-looking statements are only predictions and estimates regarding future events and circumstances and involve known and unknown risks, uncertainties and other factors, including the risks described under “Risk Factors” that may cause actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by such forward-looking statements.  This information is based on various assumptions that may not prove to be correct.

 

In addition to the risks described in the “Risk Factors” section of this prospectus-proxy statement, important factors to consider and evaluate in such forward-looking statements include:

 

These forward-looking statements are subject to significant uncertainties and contingencies, many of which are beyond the control of New Century Bank and Customers 1st Bancorp, Inc.  Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements.  Accordingly, there can be no assurance that actual results will meet expectations or will not be materially lower than the results contemplated in this prospectus-proxy statement and the attachments hereto.  You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this document or, in the case of documents referred to, the dates of those documents.  We do not undertake any obligation to release publicly any revisions to these forward-looking statements to reflect events or circumstances after the date of this document or to reflect the occurrence of unanticipated events, except as may be required under applicable law.

 

 

 

COMMONLY USED TERMS

 

For purposes of this prospectus-proxy statement, any references to the "Bank" refer to New Century Bank, any references to the "Holding Company" refer to Customers 1st Bancorp, Inc., any references to "we," "us," or "our" refer to the Bank and the Holding Company collectively, any references to the "merger subsidiary" refer to New Century Interim Bank, and any references to "Common Stock" refer to the voting common stock of the applicable entity.

 

QUESTIONS AND ANSWERS ABOUT THE ANNUAL MEETING AND VOTING

 

Why am I receiving these proxy materials?

 

The Bank is sending you this prospectus-proxy statement and the accompanying proxy card because the board of directors of the Bank is soliciting your proxy to vote at the Annual Meeting.  You are invited to attend the meeting to vote on the proposals described in this prospectus-proxy statement.  However, you do not need to attend the meeting to vote your shares.  Instead, you may simply complete, sign, and return the accompanying proxy card.

 

The Bank has mailed this prospectus-proxy statement and the accompanying proxy card to all shareholders of record entitled to vote at the meeting.

 

Who is entitled to vote at the meeting?

 

To be able to vote, you must have been a beneficial owner or record holder of the Bank's Common Stock on _______, 2010, the record date on which we determined shareholders entitled to notice of, and to vote at, the meeting (the “Record Date”).

 

Shareholder of Record:  Shares Registered in Your Name .  If, at the close of business on the Record Date, your shares of Common Stock were registered directly in your name, then you are a shareholder of record.  As a shareholder of record you may vote in person at the meeting or by proxy.  Whether or not you plan to attend the meeting, we urge you to complete and return the accompanying proxy card to ensure your vote is counted.

 

Beneficial Owner:  Shares Registered in the Name of a Broker, Bank, or Other Agent .  If, at the close of business on the Record Date, your shares were not issued directly in your name, but rather were held in an account at a brokerage firm, bank, or by another agent, you are the beneficial owner of shares held in “street name” and these proxy materials are being forwarded to you by your broker, bank, or other agent.  The broker, bank, or other agent holding your shares in that account is considered to be the shareholder of record for purposes of voting at the meeting.

 

As a beneficial owner, you have the right to direct your broker, bank, or other agent on how to vote the shares of Common Stock in your account.  You are also invited to attend the meeting.  However, since you are not the shareholder of record, you may not vote your shares in person at the meeting unless you request and obtain a valid proxy issued in your name from your broker, bank or other agent.

 

What am I being asked to vote on?

 

There are six matters scheduled for a vote at the meeting:

 

1.

To elect three Class C directors of the Bank to serve a three-year term;

 

2.

To approve and ratify the New Century Bank Management Stock Purchase Plan;

 

3.

To approve and ratify the New Century Bank 2010 Stock Option Plan;

 

4.

To ratify the appointment of ParenteBeard LLC as the independent registered public accounting firm of the Bank for the fiscal year ending December 31, 2010;

 

5.

To approve and adopt a Plan of Merger and Reorganization pursuant to which the Bank will reorganize to form a bank holding company structure; and

 

6.

To adjourn the meeting to a date to be proposed at the meeting, if necessary to solicit or receive additional proxies.

 

The Bank's board of directors recommends a vote " FOR " Proposals 1 through 6 above.

 

 

For additional information about the proposed reorganization of the Bank, see “QUESTIONS AND ANSWERS ABOUT THE REORGANIZATION” beginning on page  8 of this prospectus-proxy statement, and the sections of this prospectus-proxy statement referred to therein.

 

How many votes do I have?

 

Each holder of the Bank's Common Stock is entitled to one vote per share held.

 

What is a quorum?

 

For a proposal to be considered at the meeting, a quorum must be present.  The presence, in person or by proxy, of shareholders entitled to cast at least a majority of the votes which all shareholders are entitled to cast on the particular matter will constitute a quorum for purposes of considering such matter.  The shareholders present, in person or by proxy, at a duly organized meeting can continue to do business until adjournment, notwithstanding the withdrawal of enough shareholders to leave less than a quorum.

 

Abstentions and “broker non-votes” (that is, shares held by a broker or nominee that are represented at the meeting, but with respect to which such broker or nominee is not instructed to vote on a particular proposal and does not have discretionary voting power) will be counted for the purpose of determining whether a quorum is present.

 

Your shares will be counted toward the quorum only if you submit a valid proxy (or one is submitted on your behalf by your broker, bank, or other agent) or if you vote in person at the meeting.  If there is no quorum, the chairperson of the meeting, or a majority of the votes present at the meeting, may adjourn the meeting to another date.

 

At any adjourned meeting at which a quorum is present in person or by proxy, any business may be transacted which might have been transacted at the original meeting if a quorum had been present.

 

What vote is required?

 

For Proposal 1, if a quorum is present, the candidates receiving the highest number of votes shall be elected. See "What is cumulative voting and when does it occur?" at page 6 of this prospectus-proxy statement for more information about cumulative voting. “Withheld” votes and broker non-votes will not count in determining the number of votes required to elect a director, and they will not count in favor of or against a director’s election.  Beneficial owners should note that this year the rules regarding how brokers may vote your shares have changed. Brokers may no longer vote your shares on the election of directors in the absence of your specific instructions as to how to vote. So we encourage you to provide instructions to your broker regarding the voting of your shares.

 

For Proposals 2 through 4 and 6, if a quorum is present, the affirmative vote of a majority of the stock having voting powers, present, in person or by proxy, is required to approve such proposals.  Abstentions and broker non-votes are not deemed to constitute “votes cast” and, therefore, do not count either for or against approval of a given proposal.

 

For Proposal 5, to approve and adopt a Plan of Merger and Reorganization, if a quorum is present, the affirmative vote of holders of two-thirds of all shares of the Bank’s outstanding voting common stock is required to approve the proposal.  Abstentions and broker non-votes are not deemed to constitute “votes cast” and, therefore, do not count either for or against approval of a given proposal.

 

How do I vote?

 

For any matter to be voted on except the election of directors, you may vote “For” or “Against” or abstain from voting.  For the election of directors, you may vote " FOR " or "Against" all director nominees or you may withhold authority to vote for one or more directors nominees. To withhold authority, or if you desire to cumulate your vote, follow the instructions on your proxy card. The procedures for voting are as follows.

 

Shareholder of Record:  Shares Registered in Your Name .  If you are a shareholder of record, you may vote in person at the meeting.  Alternatively, you may vote by proxy by using the accompanying proxy card.  Whether or not you plan to attend the meeting, we urge you to vote by proxy to ensure your vote is counted.  You may still attend the meeting and vote in person if you have already voted by proxy.  In such case, notify the Corporate Secretary before the meeting begins of your presence at the meeting and your intention to revoke your previously voted proxy.

 

 

 

To vote in person, come to the meeting and we will give you a ballot when you arrive.

 

To vote by proxy, simply complete, sign, and date the accompanying proxy card and return it promptly in the envelope provided.  If you return your signed proxy card to us before the meeting, we will vote your shares as you direct unless you revoke your proxy.

 

Beneficial Owner:  Shares Registered in the Name of Broker, Bank, or Other Agent .  If your shares of Bank Common Stock are held in “street name,” that is, your shares are held in the name of a brokerage firm, bank, or other nominee, in lieu of a proxy card you should receive a voting instruction form from that institution by mail.  Complete and mail the voting instruction card as instructed to ensure that your vote is counted.

 

If your shares are held in street name and you wish to vote in person at the meeting, you must obtain a proxy issued in your name from the record holder (that is, your brokerage firm, bank or other nominee) and bring it with you to the meeting.  We recommend that you vote your shares in advance as described above so that your vote will be counted if you later decide not to attend the meeting.

 

What is cumulative voting and when does it occur?

 

Cumulative voting allows a shareholder to cast all of the shareholder’s votes for a single director or multiple directors. Pursuant to the Pennsylvania Banking Code, in each election of directors, every shareholder entitled to vote shall have the right, in person or by proxy, to multiply the number of votes to which the shareholder may be entitled by the total number of directors to be elected in the same election.  The shareholder may cast the whole number of such votes for one candidate, or the shareholder may distribute the votes among any two or more candidates. Cumulative votes may be cast for one director nominee or distributed among two or more director nominees. For example, if you owned 100 shares of the Bank's Common Stock as of the Record Date and three directors were being elected, you would have 300 votes (100 shares multiplied by three directors) to cast, in the entirety, among the three director positions.  You could cast all 300 votes for one director position, or you could allocate those 300 votes among the three director positions in any way you like, but you cannot cast more than a total of 300 votes across all director positions.

 

If you are present in person at the shareholder meeting, to engage in cumulative voting, you must notify a judge of election of your intention to cumulate votes before voting begins.  If you do this, a judge of elections will provide you with a special ballot to mark your cumulative votes.

 

If you sign and return a proxy for the meeting, you must mark on the proxy the number of votes you wish the proxies to cast for each candidate.  If you fail to show cumulative votes on your proxy, your proxies will cast an equal number of your votes for each director position.  If your proxy cumulative voting instructions are ambiguous, your proxies will have authority to cumulate and cast your votes in any manner consistent with your unambiguous instructions.

 

What if I return a proxy card but do not make specific choices?

 

If you return a signed proxy card without marking any voting selections, your shares will be voted “ FOR ” each proposal listed on the proxy card and " FOR " each director nominated by the board of directors.  If any other matter is properly presented at the meeting, then one of the proxies named on the proxy card will vote your shares using his or her best judgment.

 

What if I receive more than one proxy card or voting instruction form?

 

If you receive more than one proxy card or voting instruction form because your shares are held in multiple accounts or registered in different names or addresses, please be sure to complete, sign, date, and return each proxy card or voting instruction form to ensure that all of your shares will be voted.  Only shares relating to proxy cards and voting instruction forms that have been signed, dated, and timely returned will be counted in the quorum and voted.

 

 

 

Who will count the votes and how will my votes be counted?

 

Votes will be counted by the judge of elections appointed for the Annual Meeting.  The judge of elections will count “ FOR ” and “ AGAINST ” votes for each proposal.  

 

Can I change my vote after I have sent you my proxy?

 

Yes.  You can revoke your proxy at any time before the applicable vote at the meeting.  If you are the record holder of your shares, you may revoke your proxy in any one of three ways:

 

•

You may submit another properly completed proxy with a later date;

 

•

You may send a written notice that you are revoking your proxy to our Corporate Secretary at 99 Bridge Street, Phoenixville, Pennsylvania 19460; or

 

•

You may attend the meeting and vote in person (however, simply attending the meeting will not, by itself, revoke your proxy;  you must notify the Corporate Secretary before the meeting begins of your presence at the meeting and your intention to revoke your previously voted proxy).

 

If your shares are held by a broker, bank, or other agent, you should follow the instructions provided by them.

 

How may I communicate with the board of directors?

 

Please address any communications to the Bank's board of directors, in writing to the Bank's Corporate Secretary at 99 Bridge Street, Phoenixville, Pennsylvania 19460.  The Corporate Secretary will relay shareholder communications to the board of directors or any individual director to whom communications are directed.

 

Who will bear the cost of soliciting proxies?

 

The Bank will bear the entire cost of the solicitation of proxies for the meeting, including the preparation, assembly, printing, and distribution of this prospectus-proxy statement, the proxy card and any additional solicitation materials furnished to shareholders.  Copies of solicitation materials will be furnished to brokerage houses, fiduciaries, and custodians holding shares in their names that are beneficially owned by others so that they may forward the solicitation materials to the beneficial owners.  The Bank may reimburse such persons for their reasonable expenses in forwarding solicitation materials to beneficial owners.  The original solicitation of proxies may be supplemented by solicitation by personal contact, telephone, facsimile, email, or any other means by the Bank's directors, officers, or employees.  No additional compensation will be paid to those individuals for any such services.

 

How can I find out the results of the voting at the meeting?

 

The voting results will be announced at the meeting.

 

 

What is the recommendation of the board of directors?

 

The Bank’s board of directors recommends a vote:

 

FOR Proposal 1, to elect three Class C directors of the Bank to serve a three year term;

 

FOR Proposal 2, to approve and ratify the New Century Bank Management Stock Purchase Plan;

 

FOR Proposal 3, to approve and ratify the New Century Bank 2010 Stock Option Plan;

 

FOR Proposal 4, to ratify the appointment of ParenteBeard LLC as the independent registered public accounting firm for the fiscal year ended December 31, 2010;

 

FOR Proposal 5, to approve and adopt a Plan of Merger and Reorganization pursuant to which the Bank will reorganize to form a bank holding company structure; and

 

FOR Proposal 6, to adjourn the meeting to a date to be proposed at the meeting, if necessary to solicit or receive additional proxies.

 

With respect to any other matter that properly comes before the meeting, the proxies will vote in accordance with their best judgment.  The Judge of Election for the meeting will be Ruth Hammers or, in her absence, one or more other individuals to be appointed in accordance with the Bank’s bylaws.

 

 

QUESTIONS AND ANSWERS ABOUT THE REORGANIZATION

 

What is the proposed transaction for which I am being asked to vote?

 

You are being asked to vote on a resolution to approve and adopt the Plan of Merger and Reorganization ("Plan of Reorganization") described in this prospectus-proxy statement in order to effect a reorganization (the “reorganization” or the “transaction”) of the Bank into a bank holding company structure whereby all of the current shareholders of the Bank will become shareholders of the Holding Company, and the Bank will become a wholly owned subsidiary of the Holding Company.  The transaction, if approved by shareholders of the Bank at the Annual Meeting, will involve several steps including, among others, an application to applicable bank regulators for permission to form interim bank as a merger subsidiary into which the Bank can merge in order to become a wholly owned subsidiary of the Holding Company, applications to applicable bank regulators for permission for the Bank to merge into the merger subsidiary in accordance with the Plan of Reorganization, the exchange at a ratio of three-to-one of outstanding shares of the Bank's Common Stock and Class B Non-Voting Common Stock for shares of the Holding Company's Common Stock and Class B Non-Voting Common Stock, and the exchange of outstanding warrants and options to purchase shares of the Bank's Common Stock for warrants or options, respectively, to purchase shares of the Holding Company's Common Stock.

 

For more information on the reorganization and the Plan of Reorganization, see “THE REORGANIZATION” beginning at page  39 of this prospectus-proxy statement and the Plan of Reorganization attached as  Annex A to this prospectus-proxy statement.

 

What will I receive for my Bank shares?

 

You will receive one Holding Company share of Common Stock for every three shares of Bank Common Stock you hold immediately prior to the closing of the reorganization.  Shareholders who hold shares of the Bank’s Class B Non-Voting Common Stock immediately prior to the reorganization will receive one share of the Holding Company’s Class B Non-Voting Common Stock for every three shares of the Bank’s Class B Non-Voting Common Stock they hold immediately prior to the closing of the reorganization.  The Holding Company will not issue any fractional shares in the reorganization. Holders of Bank Common Stock or Class B Non-Voting Common Stock who would otherwise be entitled to a fractional share of Holding Company Common Stock or Class B Non-Voting Common Stock will instead receive an amount in cash, rounded to the nearest cent and without interest, equal to the product of (i) the fraction of such share to which the holder would otherwise have been entitled, and (ii) the book-value of one share of Common Stock of the Bank as of the final day of the quarter ended immediately prior to the closing of the reorganization.

 

 

 

What will holders of options and warrants to purchase the Bank's Common Stock receive?

 

All warrants and options for the purchase of the Bank's Common Stock or Class B Non-Voting Common Stock that have been granted will automatically become warrants or options, respectively, to purchase one-third the number of shares of the Holding Company's Common Stock or Class B Non-Voting Common Stock, as applicable.  The number of Holding Company shares for which each outstanding option or warrant will be exercisable after the reorganization will be rounded up to the nearest whole number of shares, subject to the holder's agreement to any necessary corresponding upward rounding adjustments of the exercise price to the nearest whole cent.

 

Do I have to take any action to exchange my Bank shares?

 

Your shares of the Bank's Common Stock will be exchanged for shares of the Holding Company's Common Stock without any action on your part.  Upon completion of the reorganization, you will be mailed a letter of transmittal and instructions related to the exchange of the certificates and other instruments representing your ownership of the Bank's Common Stock, Class B Non-Voting Common Stock, or options or warrants to purchase the Bank's Common Stock, as applicable, for certificates or other instruments representing the Holding Company's securities into which your securitites have been converted as a result of the reorganization.  You should not send in your certificates or other instruments representing your ownership of the Bank's securities until we notify you to do so.

 

Can I trade Bank shares between the date of this prospectus-proxy statement and the closing of the reorganization?

 

Yes.  To the extent you are currently allowed to trade such shares, the Bank’s shares will continue to be tradable during this period.

 

After the transaction, where can I trade the Holding Company's shares?

 

There is no established trading market for the Bank's Common Stock or Class B Non-Voting Common Stock and we do not expect there to be an established trading market for the Holding Company's Common Stock or Class B Non-Voting Common Stock after the reorganization.  The Holding Company's Common Stock and Class B Non-Voting Common Stock may not be listed or quoted on any exchange.  Trades of the Bank's Common Stock and Class B Non-Voting Common Stock have not regularly been reported, so it is unlikely that trades of the Holding Company's Common Stock and Class B Non-Voting Common Stock will be regularly reported in the foreseeable future.

 

Will the transaction affect the Bank’s current or future operations?

 

We currently believe that the transaction should have no material impact on how we conduct our day-to-day operations.  A holding company structure may allow us to conduct some activities the Bank could not conduct on its own, or it may allow us to make some acquisitions the Bank could not otherwise make.  Please see “Risk Factors” beginning at page  13 of this prospectus-proxy statement for a discussion of various ways in which the transaction could have an adverse effect on us.

 

Will the transaction dilute my economic interest?

 

The transaction will not dilute your economic interest.  While the number of outstanding shares of the Holding Company outstanding immediately after the consummation of the transaction will be one-third the number of outstanding shares of the Bank immediately before consummation of the transaction, the economic interest associated with all shares will remain the same.

 

Will the transaction result in any changes to my rights as a shareholder?

 

Yes.  Your rights under the Pennsylvania Business Corporation Law as a holder of shares of Common Stock of the Holding Company will differ in certain respects from your current rights under the Pennsylvania Banking Code.  We summarize the material changes in your rights as a shareholder resulting from the transaction at “Comparison of Shareholders' Rights" beginning at page  52 of this prospectus-proxy statement.

 

 

 

 

What are the expected federal income tax consequences of the reorganization?

 

The reorganization is designed to qualify as a tax-free reorganization for federal income tax purposes and the Bank and the Holding Company will receive a legal opinion to that effect.  Thus, while there can be no guarantee that the U.S. Internal Revenue Service will adopt a similar position, it is expected that Bank shareholders will have no federal income tax consequences as a result of the reorganization, except with respect to receipt of cash in lieu of any fractional interests in the shares of the Holding Company (and other than dissenting shareholders who elect dissenters’ rights).  Bank shareholders should consult with their tax adviser about state and local tax consequences of the reorganization, if any, because the information about tax consequences in this prospectus-proxy statement relates to the federal income tax consequences of the reorganization only.  Please refer to “Material U.S. Federal Income Tax Considerations” beginning on page  46 of prospectus-proxy statement for a description of the material U.S. federal income tax consequences of the reorganization to the Bank's shareholders.

 

When do you expect the transaction to be completed?

 

We intend to close the reorganization as quickly as possible and, assuming the transaction is approved by the Bank’s shareholders and the banking regulators, we expect to close the transaction during the third quarter of 2010.  However, completion of the reorganization could be delayed if we fail to obtain the necessary regulatory approvals, or if we propose to complete an acquisition or similar transaction.  See "THE REORGANIZATION - Acquisition Stragies" for more information about potential acquisitions or similar transactions. Our boards of directors have the right to withdraw or postpone the transaction for any reason even if all necessary regulatory and shareholder approvals have been obtained.

 

What vote of the Bank's shareholders is required to approve the reorganization?

 

The affirmative vote of the holders of two-thirds (2/3) of the shares of Common Stock of the Bank that are outstanding on the Record Date is required to approve the reorganization.

 

What vote does the Bank’s board of directors recommend?

 

The Bank’s board of directors recommends that the Bank’s shareholders vote “ FOR ” the proposal to approve and adopt the Plan of Reorganization pursuant to which the Bank will reorganize to form a bank holding company structure.

 

Are the interests of the Bank’s board of directors and executive officers in this transaction the same as mine?

 

In considering the information contained in this prospectus-proxy statement, you should be aware that the Bank’s directors and executive officers have interests in the reorganization that may be different from, or in addition to, the interests of the Bank’s shareholders. These additional interests of the Bank’s directors and executive officers may create potential conflicts of interest and cause these individuals to view the proposed transaction differently than you may view it as a shareholder.

 

The Bank’s board of directors was aware of these interests and took them into account in its decision to declare advisable the Plan of Reorganization and the reorganization contemplated thereby. For information concerning these interests, please see the discussion under the caption “INTERESTS OF MANAGEMENT AND OTHERS IN THE MERGER AND REORGANIZATION” beginning at page  62 of this prospectus-proxy statement.

 

 

 

Do I have the right to dissent from the merger?

 

Yes.  You have the right under Pennsylvania law to dissent from the merger and to demand and receive cash for the fair value of the Bank's Common Stock that you hold.  In order to assert dissenters’ rights, shareholders must precisely follow the process described in “THE REORGANIZATION – Dissenters’ Rights” and in Annex B .

 

Generally, a shareholder who wishes to dissent must:

 

•

File with the Bank a written notice of intention to demand that the shareholder be paid the fair value for his or her shares of Bank Common Stock and Class B Non-Voting Common Stock rather than receive Holding Company shares as described in the Plan of Reorganization.  The dissenting shareholder must file this notice with the Bank prior to the shareholder vote on the reorganization at the Annual Meeting;

 

•

A dissenting shareholder may not change the beneficial ownership of his or her Bank Common Stock and Class B Non-Voting Common Stock from the date of the filing of the notice of intention to demand payment through the effective date of the reorganization; and

 

•

A dissenting shareholder also may not vote his or her Bank common stock to approve the reorganization at the Annual Meeting.

 

You should consult with your own legal advisor as to your dissenters’ rights under Pennsylvania law.  Failure to strictly comply with these procedures will result in the loss of dissenters’ rights and your ability to receive cash for the fair value of your Bank Common Stock.

 

What are the conditions that must be satisfied for the reorganization to occur?

 

As more fully described in this prospectus-proxy statement, the completion of the reorganization depends on the satisfaction of a number of conditions. These conditions include, among others:

 

•

Approval by the requisite vote of the Bank’s shareholders;

 

•

The receipt of all regulatory consents and approvals required in connection with (i) the establishment of the Holding Company as a bank holding company, and (ii) the creation of the merger subsidiary, and (iii) the merger of the Bank into the merger subsidiary;

 

•

The receipt by the Bank of a legal opinion with respect to certain United States federal income tax consequences of the reorganization; and

 

•

The effectiveness of the registration statement of which this prospectus-proxy statement is a part with respect to the Holding Company Common Stock and Class B Non-Voting Common Stock to be issued in the reorganization under the Securities Act of 1933, as amended, and the absence of any stop order or proceedings initiated or threatened by the Securities and Exchange Commission or any applicable state securities commissioner for that purpose.

 

We cannot be certain when, or if, the conditions to the reorganization will be satisfied, or that the reorganization will be completed.

 

Can the proposed reorganization be deferred or abandoned altogether?

 

While we currently expect the reorganization to take place as soon as practicable after meeting the necessary conditions, the Bank's board of directors could decide to defer or abandon the transaction.  The board of directors could do this for any number of reasons including, without limitation, because of increased estimated costs of the transaction, a determination that the transaction is no longer in the best interests of the Bank or its shareholders, an inability to obtain regulatory approval, or a conclusion that the transaction may not result in the benefits currently expected.

 

 

 

What do I need to do now?

 

After you have carefully read this prospectus-proxy statement and have decided how you wish to vote your shares, please vote your shares promptly. If you hold common stock in your name as a shareholder of record, you must complete, sign, date and mail your proxy card in the enclosed postage paid return envelope as soon as possible. If you beneficially own your stock in “street name” through a brokerage firm, bank, or other nominee, you must direct such entity or person to vote in accordance with the instructions you have received from your brokerage firm, bank, or other nominee. Submitting your proxy card or directing your brokerage firm, bank, or other nominee to vote your shares will ensure that your shares are represented and voted at the Annual Meeting.

 

What happens after the meeting?

 

If the reorganization is approved at the meeting, we plan to file applications with the banking regulators for their approval of the transaction.  Once all approvals are obtained, we plan to complete the transaction.

 

Whom should I call if I have questions about the meeting or the transaction?

 

You should contact Trudy Hackney at (484) 359-7135 (for questions about the meeting), and Thomas Brugger at (484) 359-7113 (for questions about the transaction).