AGREEMENT AND PLAN OF MERGER BY AND BETWEEN CITIZENS & NORTHERN CORPORATION AND SUSQUEHANNA COMMUNITY FINANCIAL, INC.
TABLE OF CONTENTS
Appendix IDefinitions
Appendix IIKnowledge Groups
Exhibit ABank Merger Agreement
Exhibit BForm of Voting Agreement
Schedule 3.4(a) –Capitalization
Schedule 3.9 –Absence of Undisclosed Liabilities
Schedule 3.11 –Dividends, Distributions and Stock Purchases
Schedule 3.12–Taxes
Schedule 3.13 –Title to and Condition of Assets
Schedule 3.14(a) –Contracts
Schedule 3.15 –Litigation and Governmental Directives
Schedule 3.16 –Risk Management Instruments
Schedule 3.17 –Environmental Matters
Schedule 3.18(b) –Security Breach
Schedule 3.21 –Insurance
Schedule 3.22 –Financial Institution Bonds
Schedule 3.23(b) –Labor Relations and Employment Agreements
Schedule 3.24(a) –Employee Benefit Plans
Schedule 3.24(f) –Multiple Employer Plan
Schedule 3.24(g)–Post-Employment or Post-Termination Benefits
Schedule 3.24(k)–Excess Parachute Payments
Schedule 3.24(l)--Benefit Plan Gross Ups
Schedule 3.25(a) –Loan Portfolio
Schedule 3.25(g) _Real Estate Owned
Schedule 3.27–Related Party Transactions
Schedule 3.29 –Brokers
Schedule 4.3(i) –C&N Subsidiaries
Schedule 4.3(ii) –C&N Bank Subsidiaries
Schedule 4.4(a) –Capitalization
Schedule 4.4(c)–C&N Plans
Schedule 4.9–Absence of Undisclosed Liabilities
Schedule 4.11 –Dividends, Distributions and Stock Purchases
Schedule 4.12-Taxes
Schedule 4.13 –Litigation and Governmental Directives
Schedule 4.15-No Brokers
Schedule 4.16-Risk Management Instruments
Schedule 4.17(b) -Personal Information and Data Security
Schedule 5.1 –Conduct of Business
Schedule 5.1(k)–Material Contracts
Schedule 5.1(p)–Employee Compensation
Schedule 5.1(v)–Capital Expenditures
Schedule 5.11(a)–Transaction Expenses of Susquehanna
AGREEMENT AND PLAN OF MERGER
This Agreement and Plan of Merger (the “Agreement”), entered into as of 23 April 2025, by and between Citizens & Northern Corporation, a Pennsylvania corporation having its administrative headquarters at ▇▇-▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ (“C&N”), and Susquehanna Community Financial, Inc., a Pennsylvania corporation having its administrative headquarters at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ (“Susquehanna”).
BACKGROUND:
C&N is a bank holding company registered under the Bank Holding Company Act of 1956, as amended (the “BHC Act”), and is the parent holding company of Citizens & Northern Bank, a Pennsylvania-chartered bank (“C&N Bank”).
Susquehanna is a financial holding company registered under the BHC Act and is the parent holding company of Susquehanna Community Bank, a Pennsylvania-chartered bank (“Susquehanna Bank”).
The Boards of Directors of C&N and Susquehanna have determined that it is in the best interests of C&N and ▇▇▇▇▇▇▇▇▇▇▇, respectively, for Susquehanna to merge with and into C&N with C&N surviving (the “Merger”), and for Susquehanna Bank to merge with and into C&N Bank, with C&N Bank surviving (the “Bank Merger”). In connection with the Bank Merger, C&N Bank and Susquehanna Bank will enter into a Bank Merger Agreement, the form of which is attached hereto as Exhibit A (the “Bank Merger Agreement”).
In connection with the Merger, all of the outstanding shares of the common stock of Susquehanna, $1.00 par value per share (the “Susquehanna Common Stock”), will be converted into shares of the common stock of C&N, par value $1.00 per share (the “C&N Common Stock”), on the terms described in this Agreement.
In connection with the execution of this Agreement, Susquehanna has obtained voting agreements in the form of Exhibit B, attached hereto, from the directors and officers listed on Exhibit B, pursuant to which each such person has agreed to vote all shares of Susquehanna Common Stock beneficially owned by him or her in favor of this Agreement, the Merger and, to the extent required, all transactions incident thereto and to refrain from soliciting interest in an alternative transaction (collectively, the “Voting Agreements”).
WITNESSETH:
NOW, THEREFORE, in consideration of the mutual covenants contained herein and intending to be legally bound, the Parties hereby agree as follows:
Appendix I sets forth definitions of capitalized terms used in this Agreement which are not otherwise defined within the text of this Agreement.
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“Conversion Ratio” means 0.80, which is the number of shares of C&N Common Stock payable in the Merger per Susquehanna Share.
“C&N Stock Consideration” means the aggregate number of shares of C&N Common Stock into which the Susquehanna Shares are to be converted into C&N Common Stock.
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Except as disclosed in the disclosure schedule (with such disclosures referenced as Schedules below) delivered by Susquehanna to C&N concurrently with the execution and delivery of this Agreement (the “Susquehanna Disclosure Schedule”) (it being understood that (i) no such item is required to be set forth as an exception to a representation or warranty if its absence would not result in the related representation or warranty being deemed untrue or incorrect, (ii) the mere inclusion of an item in the Susquehanna Disclosure Schedule as an exception to a representation or warranty shall not be deemed an admission by Susquehanna that such item represents a material exception or fact, event or circumstance or that such item would reasonably be expected to have a Material Adverse Effect, and (iii) any disclosures made with respect to a section of this ARTICLE III shall be deemed to qualify (A) any other section of this ARTICLE III specifically referenced or cross-referenced, and (B) other sections of this ARTICLE III to the extent it is reasonably apparent on its face (notwithstanding the absence of a specific cross-reference) from a reading of the disclosure that such disclosure applies to such other sections), Susquehanna hereby represents and warrants to C&N as follows:
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filing of any required applications, filings or notices, as applicable, with the Financial Industry Regulatory Authority (“FINRA”) and the approval of such applications, filings and notices; (iii) the filing with the SEC of a proxy statement and prospectus in definitive form relating to the meeting of Susquehanna’s shareholders to be held in connection with this Agreement, the offering of C&N Common Stock in the Merger and the other transactions contemplated hereby (including any amendments or supplements thereto, the “Proxy Statement/Prospectus”), and of the Registration Statement on Form S-4 in which the Proxy Statement/Prospectus will be included, to be filed with the SEC by C&N in connection with the transactions contemplated by this Agreement (the “Registration Statement”) and declaration of effectiveness of the Registration Statement, (iv) the filing of Articles of Merger with the Filing Office and (v) such filings and approvals as are required to be made or obtained under the securities or “Blue Sky” laws of various states in connection with the issuance of the shares of C&N Common Stock pursuant to this Agreement, no consents or approvals of or filings or registrations with any court or administrative agency or commission or other governmental authority or instrumentality or SRO (each a “Governmental Entity”) are necessary in connection with (A) the execution and delivery by Susquehanna of this Agreement or (B) the consummation by Susquehanna of the Merger and the other transactions contemplated hereby (including the Bank Merger). As of the date hereof, Susquehanna is not aware of any reason why the necessary regulatory approvals and consents will not be received in order to permit consummation of the Merger and Bank Merger on a timely basis.
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or operations of Susquehanna or any of the Susquehanna Subsidiaries since the Look Back Date, except where such proceedings or investigation would not reasonably be likely to have, either individually or in the aggregate, a Material Adverse Effect on Susquehanna. To the Knowledge of Susquehanna, there is no unresolved violation, criticism, or exception by any Regulatory Agency with respect to any report or statement relating to any examinations or inspections of Susquehanna or any of the Susquehanna Subsidiaries, which would reasonably be likely to have, either individually or in the aggregate, a Material Adverse Effect on Susquehanna.
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Susquehanna Subsidiary has declared, set aside, made or paid any dividend or other distribution in respect of the Susquehanna Common Stock or the Susquehanna Subsidiaries Common Equity, or purchased, issued or sold any shares of Susquehanna Common Stock or the Susquehanna Subsidiaries Common Equity.
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Susquehanna Subsidiaries has participated in a “listed transaction” within the meaning of Treasury Regulations Section 1.6011-4(b)(2). At no time during the past six (6) years has Susquehanna been a United States real property holding corporation within the meaning of Section 897(c)(2) of the Code. Neither Susquehanna nor any of the Susquehanna Subsidiaries will be required to include any material item of income in, or to exclude any material item of deduction from, taxable income in any taxable period (or portion thereof) ending after the Effective Date as a result of any (i) change in method of accounting, (ii) closing agreement, (iii) intercompany transaction or excess loss account described in Treasury Regulations under Section 1502 of the Code (or any similar provision of state, local or foreign law), (iv) installment sale or open transaction disposition made on or prior to the Effective Date, or (v) prepaid amount received on or prior to the Effective Date, in the case of (i), (iii), (iv) and (v), outside of the Ordinary Course of Business.
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Susquehanna Subsidiaries, were entered into in the Ordinary Course of Business and in accordance with applicable rules, regulations and policies of any Regulatory Agency and with counterparties believed to be financially responsible at the time and are legal, valid and binding obligations of Susquehanna or one of the Susquehanna Subsidiaries enforceable in accordance with their terms (except as may be limited by the Bankruptcy and Equity Exceptions). Except as set forth in Schedule 3.16, none of such instruments would reasonably be expected to experience adverse changes in value as a result of changes in interest or exchange rate changes that would exceed offsetting values of the underlying instruments. Susquehanna and each of the Susquehanna Subsidiaries have duly performed in all material respects all of their obligations thereunder to the extent that such obligations to perform have accrued, and, to Susquehanna’s Knowledge, there are no material breaches, violations or defaults or bona fide allegations or assertions of such by any party thereunder.
Except as may be set forth in Schedule 3.17, with respect to Susquehanna and each Susquehanna Subsidiary:
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Common Stock (or any of such person’s immediate family members or Affiliates) (other than Susquehanna Subsidiaries) on the other hand, of the type that would be required to be reported in any SEC Report to which Susquehanna would be subject (if Susquehanna would be subject thereto) pursuant to Item 404 of Regulation S-K promulgated under the Exchange Act (a “Related Party Transaction”).
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Except as disclosed in the disclosure schedule (with such disclosures referenced as Schedules below) delivered by C&N to Susquehanna concurrently with the execution and delivery of this Agreement (the “C&N Disclosure Schedule”) (it being understood that (i) no such item is required to be set forth as an exception to a representation or warranty if its absence would not result in the related representation or warranty being deemed untrue or incorrect, (ii) the mere inclusion of an item in the C&N Disclosure Schedule as an exception to a representation or warranty shall not be deemed an admission by C&N that such item represents a material exception or fact, event or circumstance or that such item would reasonably be expected to have a Material Adverse Effect, and (iii) any disclosures made with respect to a section of this ARTICLE IV shall be deemed to qualify (A) any other section of this ARTICLE IV specifically
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referenced or cross-referenced, and (B) other sections of this ARTICLE IV to the extent it is reasonably apparent on its face (notwithstanding the absence of a specific cross-reference) from a reading of the disclosure that such disclosure applies to such other sections), C&N hereby represents and warrants to Susquehanna as follows:
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this Agreement or (B) the consummation by C&N of the Merger and the other transactions contemplated hereby (including the Bank Merger). As of the date hereof, C&N is not aware of any reason why the necessary regulatory approvals and consents will not be received to permit consummation of the Merger and Bank Merger on a timely basis.
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closing agreement, (iii) intercompany transaction or excess loss account described in Treasury Regulations under Section 1502 of the Code (or any similar provision of state, local or foreign law), (iv) installment sale or open transaction disposition made on or prior to the Effective Date, or (v) prepaid amount received on or prior to the Effective Date, in the case of (i), (iii), (iv) and (v), outside of the Ordinary Course of Business.
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requirements relating to the origination, sale and servicing of mortgage and consumer loans. C&N Bank has a Community Reinvestment Act rating of “satisfactory” or better.
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From the date of this Agreement until the Effective Time, Susquehanna covenants and agrees to comply, and shall cause the Susquehanna Subsidiaries to comply, with the following covenants:
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Susquehanna shall use commercially reasonable efforts to (i) cause the employees and officers of Susquehanna and the Susquehanna Subsidiaries to work cooperatively, in good faith, with C&N to plan for the conversion of the data processing and related electronic informational systems of Susquehanna and each of the Susquehanna Subsidiaries to those used by C&N as soon as practicable following the Effective Date, (ii) cooperate with C&N in making Susquehanna’s and the Susquehanna Subsidiaries’ employees reasonably available for training by C&N at Susquehanna’s and the Susquehanna Subsidiaries’ facilities a reasonable period of time prior to the Effective Time, to the extent that such training is deemed reasonably necessary by C&N to ensure that Susquehanna’s and the Susquehanna Subsidiaries’ facilities will be properly operated in accordance with C&N’s policies after the Merger, (iii) permit representatives of C&N Bank to be onsite at Susquehanna Bank during normal business hours and (iv) allow its employees to provide assistance with the preparation and filing of all documentation that is necessary or desirable to obtain all permits, consents, approvals and authorizations of third parties and Governmental Entities to close and/or consolidate any C&N Bank or Susquehanna Bank branches or facilities. Notwithstanding anything to the contrary herein, neither Susquehanna nor Susquehanna Bank shall be required to (i) terminate any third-party service provider arrangements prior to the Closing or (ii) take any action that may unreasonably and materially interfere with the business of Susquehanna or Susquehanna Bank or impede or delay the consummation of the Closing; and provided further, that in the event that Susquehanna or Susquehanna Bank takes, at the request of C&N, any action relative to third parties to facilitate the data processing conversion that results in the imposition of any fees or charges, C&N shall indemnify Susquehanna for any such fees and charges, and the costs of reversing the conversion process in the event of a termination of this Agreement by Susquehanna under Section 12.1(b).
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For purposes of this Agreement, “Acquisition Proposal” shall mean any inquiry, offer or proposal (other than an inquiry, offer or proposal from C&N), whether or not in writing, contemplating, relating to, constituting or that could reasonably be expected to lead to, an Acquisition Transaction. For purposes of this Agreement, “Acquisition
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Transaction” shall mean (A) any transaction or series of transactions involving any merger, consolidation, recapitalization, share exchange, liquidation, dissolution or similar transaction involving Susquehanna or any Susquehanna Subsidiary; (B) any transaction pursuant to which any third party or group acquires or would acquire (whether through sale, lease or other disposition), directly or indirectly, any assets of Susquehanna or any Susquehanna Subsidiary representing, in the aggregate, twenty-five percent (25%) or more of the assets of Susquehanna and each Susquehanna Subsidiary on a consolidated basis; (C) any issuance, sale or other disposition of (including by way of merger, consolidation, share exchange or any similar transaction) securities (or options, rights or warrants to purchase or securities convertible into, such securities) representing twenty-five percent (25%) or more of the votes attached to the outstanding securities of Susquehanna or any Susquehanna Subsidiary; (D) any tender offer or exchange offer that, if consummated, would result in any third party or group beneficially owning twenty-five percent (25%) or more of any class of equity securities of Susquehanna or any Susquehanna Subsidiary; or (E) any transaction which is similar in form, substance or purpose to any of the foregoing transactions, or any combination of the foregoing.
For purposes of this Agreement, “Superior Proposal” shall mean any bona fide written proposal (on its most recently amended or modified terms, if amended or modified) made by a third party to enter into a Susquehanna Acquisition Transaction on terms that the Susquehanna Board of Directors determines in its good faith judgment, after consultation with and having considered the advice of outside legal counsel and its financial advisor, (i) would, if consummated, result in the acquisition of all, but not less
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than all, of the issued and outstanding shares of Susquehanna Common Stock or all, or substantially all, of the assets of Susquehanna and any Susquehanna Subsidiary on a consolidated basis and (ii) would result in a transaction that (A) provides for the payment, in the aggregate, of consideration to the holders of the shares of Susquehanna Shares that is more favorable from a financial point of view than the Merger Consideration, (B) is, in light of the other terms of such proposal, including the nature of the consideration being offered, any required regulatory approvals, any required financing and any risks associated with the timing of the proposed transaction, more favorable to Susquehanna’s shareholders than the Merger and the transactions contemplated by this Agreement; and (C) is reasonably likely to be completed on the terms proposed, in each case taking into account all legal, financial, regulatory and other aspects of the proposal.
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audit team for the purpose of ongoing assessment of internal controls and shall cause its outside auditors to provide any documentation regarding Susquehanna’s internal control to C&N and cause its auditors to be available for discussions with C&N’s representatives regarding Susquehanna’s systems of internal controls. Notwithstanding the foregoing, Susquehanna shall not be required to provide access to or to disclose information where such access or disclosure would waive any attorney-client privilege.
From the date of this Agreement until the Effective Time, or until such later date as may be expressly stipulated in any Section of this ARTICLE VI, C&N covenants and agrees to comply, and shall cause the C&N Subsidiaries to comply, with the following covenants:
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confidential), contracts, documents and records of C&N and the C&N Subsidiaries as Susquehanna may reasonably request; provided, however, that neither C&N nor any of the C&N Subsidiaries shall be required to take any action that would provide access to or to disclose information where such access or disclosure would not be protected by the Nondisclosure and Confidentiality Agreement or would result in the waiver by it of the privilege protecting communications between it and any of its counsel or that is otherwise prohibited by law or contractual agreement. Susquehanna shall use commercially reasonable efforts to minimize any interference with C&N’s regular business operations during any such access to the property, books and records of C&N or any C&N Subsidiary.
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conditions prior to or as of the Closing, except to the extent that any such condition shall have been waived by C&N in accordance with the provisions of Section 12.4 herein:
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This Agreement may be terminated at any time prior to the Effective Date, whether before or after approval of the Merger by the shareholders of Susquehanna:
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If Susquehanna elects to exercise its termination right pursuant to this Section 12.1(h), it shall give prompt (but in any case on or before the end of business on the last day in the Notice Period) written notice to C&N; provided that such notice of election to terminate may be withdrawn at any time within the aforementioned three-day period. For a period of five (5) Business Days after receipt of such notice, C&N shall have the option of increasing the Conversion Ratio in a manner such, and to the extent required, that the condition set forth in either clause (A) or (B) above shall be deemed not to exist.
If C&N makes this election, within such period, it shall give prompt written notice to Susquehanna of such election and the revised Conversion Ratio, whereupon no termination shall have occurred pursuant to this Section 12.1(h) and this Agreement shall remain in effect in accordance with its terms (except as the Conversion Ratio shall have been so modified), and any references in this Agreement to “Conversion Ratio” shall thereafter be deemed to refer to the Conversion Ratio after giving effect to any adjustment made pursuant to this Section 12.1(h).
For purposes of this Section 12.1(h), the following terms shall have the meanings indicated:
“Closing Price” means the average closing price of C&N Common Stock as reported on the NASDAQ Capital Market, calculated to two (2) decimal places, for the ten (10) trading days immediately preceding the date which is five (5) business days before the Effective Time.
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“Determination Date” shall mean the fifth (5th) trading day immediately prior to the Effective Time, or if such calendar day is not a trading day on the NASDAQ Capital Market, the trading day immediately preceding such calendar day.
“Index Price” on a given date means the closing price of the KBW NASDAQ Regional Banking Index.
“Starting Date” means the trading day on the NASDAQ Stock Market immediately preceding the day on which the Parties publicly announce the signing of this Agreement.
“Starting Price” means $19.48.
If C&N declares or effects a stock dividend, reclassification, recapitalization, split-up, combination, exchange of shares or similar transaction between the Starting Date and the Determination Date, the prices for the common stock of C&N shall be appropriately adjusted for the purposes of applying this Section 12.1(h).
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however, that any amendment to the Merger Consideration to be received by the shareholders of Susquehanna in exchange for their shares of Susquehanna Common Stock shall not take effect until such amendment has been approved, adopted or ratified by the shareholders of Susquehanna in accordance with applicable provisions of the Applicable Corporate Law.
J. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, president & CEO
Citizens & Northern Corporation
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Wellsboro, PA 16901
▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇.▇▇▇
With a copy (which shall not constitute notice) to:
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▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
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Lancaster, PA 17602
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▇▇. ▇▇▇▇▇ ▇▇▇▇
Susquehanna Community Financial, Inc.
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West ▇▇▇▇▇▇ Pennsylvania
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With a copy (which shall not constitute notice) to:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇.
Pillar + Aught
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Harrisburg, PA 17111
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[Signature Page to Follow]
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IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed by their duly authorized officers all as of the day and year first above written.
CITIZENS & NORTHERN CORPORATION
By: /s/ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Attest: /s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
SUSQUEHANNA COMMUNITY FINANCIAL, INC.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
Attest: /s/ ▇▇▇▇▇ ▇ ▇▇▇▇▇▇
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APPENDIX I
Definitions of the following capitalized terms used in this Agreement are set forth below or in the indicated sections:
“Acquisition Proposal” has the meaning given to it in Section 5.8(a)
“Acquisition Transaction” has the meaning given to it in Section 5.8(a)
“Additional Financial Statements” means any internal monthly and quarterly financial reports, all quarterly or annual reports to shareholders and all regulatory reports to regulatory authorities normally prepared by the Party in question or by its banking Subsidiary subject to any restrictions on dissemination thereof imposed by applicable Bank Regulators.
“Affiliate” of any particular Person means any other Person controlling, controlled by or under common control with such particular Person, where “control” means the possession, directly or indirectly, of the power to direct the management and policies of a Person whether through the ownership of voting securities, contract or otherwise.
“Agreement” has the meaning given to it in the Introduction.
“Applicable Corporate Law” shall mean the Pennsylvania Business Corporation Law of 1988, as amended.
“Bank Merger” has the meaning given to it in the Background.
“Bank Merger Agreement” has the meaning given to it in the Background.
“Bank Merger Effective Time” has the meaning given to it in Section 1.1(b).
“Bank Regulators” means Federal Reserve Board, the FDIC, the OCC and the Pennsylvania Department.
“Bankruptcy and Equity Exceptions” has the meaning given to it in Section 3.2(b)
“Benefit Plan” means all employee benefit plans (as defined in Section 3(3) of ERISA), whether or not subject to ERISA, and all equity, bonus or incentive, deferred compensation, retiree medical or life insurance, supplemental retirement, severance, termination, change in control, retention, employment, welfare, insurance, medical, fringe or other benefit plans, programs, agreements, contracts, policies, arrangements or remuneration of any kind with respect to which the referenced Party or any Subsidiary or any trade or business of the referenced Party or any of its Subsidiaries, whether or not incorporated, all of which together with the referenced Party would be deemed a “single employer” within the meaning of Section 4001 of ERISA (an
“ERISA Affiliate”), is a party or has any current or future obligation or that are maintained, contributed to or sponsored by the referenced Party or any of its Subsidiaries or the referenced Party’s ERISA Affiliate for the benefit of any current or former employee, officer, director or independent contractor of the referenced Party or any of its Subsidiaries or any referenced Party ERISA Affiliate, excluding, in each case, any “multiemployer plan” within the meaning of Section 4001(a)(3) of ERISA (a “Multiemployer Plan”).
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“Business Day” means any day other than a Saturday, Sunday or day on which banking institutions in Pennsylvania are authorized or obligated pursuant to legal requirements or executive order to be closed.
“Canceled Shares” has the meaning given to it in Section 2.1(a)(iv).
“Chosen Courts” has the meaning given to it in Section 13.6(b).
“Claim” has the meaning given to it in Section 11.2(b).
“Closing” has the meaning given to it in Section 9.1
“Closing Price” has the meaning given to it in Section 12.1(h).
“Code” means the Internal Revenue Code of 1986, as amended.
“Conversion Ratio” has the meaning given to it in Section 2.1(b), subject to modification by Section 12.1(h).
“Current Year” means the current fiscal year of a Party.
“C&N” has the meaning given to it in the heading of this Agreement.
“C&N Balance Sheet” has the meaning given to it in Section 4.9.
“C&N Closing Documents” has the meaning given to it in Section 8.3(f).
“C&N Common Stock” has the meaning given to it in the Background.
“C&N Disclosure Schedule” has the meaning given to it in Article IV.
“C&N Incentive Equity” means equity-based awards under a C&N Stock Plan.
“C&N Plans” has the meaning given to it in Section 11.1(b)
“C&N Ratio” has the meaning given to it in Section 12.1(h).
“C&N SEC Reports” has the meaning given to it in Section 4.6
“C&N Stock Consideration” has the meaning given to it in Section 2.1(b).
“C&N Stock Plan” has the meaning given to it in Section 4.4(c)
“C&N Subsidiaries” shall have the meaning given to it in Section 4.3.
“C&N Subsidiaries Common Equity” has the meaning given to it in Section 4.4(d)
“Determination Date” has the meaning given to it in Section 12.1(h)
“Effective Date” has the meaning given to it in Section 9.2 .
“Effective Time” has the meaning given to it in Section 9.2.
“Employment Agreements” has the meaning given to it in Section 3.23.
“Employment Obligation” means any employment contract, change of control agreement or policy, severance agreement or policy, deferred compensation agreement, consulting agreement or similar obligation, in each case including any amendments thereto.
“Environmental Laws” means any federal, state or local law, regulation, order, decree, permit, authorization, common law or agency requirement relating to: (a) the protection or restoration of the environment, health and safety as it relates to hazardous substance exposure or natural
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resource damages, (b) the handling, use, presence, disposal, release or threatened release of, or exposure to, any hazardous substance, or (c) noise, odor, wetlands, indoor air, pollution, contamination or any injury to Persons or property from exposure to any hazardous substance.
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.
“Exchange Act” means the Securities Exchange Act of 1934, as amended.
“Exchange Agent” shall mean Equiniti Trust Company.
“FDI Act” has the meaning given to it in Section 3.1(b)
“FDIC” means the Federal Deposit Insurance Corporation.
“Federal Reserve Board” means the Board of Governors of the Federal Reserve System.
“Filing Office” shall mean the Pennsylvania Department of State.
“Final Notice of Superior Proposal” has the meaning given to it in Section 5.8(e)
“FINRA” means the Financial Industry Regulatory Authority.
“C&N Bank” has the meaning given to it in the Background.
“GAAP” means United States Generally Accepted Accounting Principles.
“Governmental Entity” has the meaning given to it in Section 3.5.
“Indemnified Liabilities” has the meaning given to it in Section 11.2(b)
“Indemnified Parties” has the meaning given to it in Section 11.2(b)
“Index Price” has the meaning given to it in Section 12.1(h)
“Index Ratio” has the meaning given to it in Section 12.1(h)
“Injunction” has the meaning given to it in Section 8.1(d)
“Insiders” has the meaning given to it in Section 2.6.
“Intellectual Property” has the meaning given to it in Section 3.19.
“IRS” has the meaning given to it in Section 3.12.
“Knowledge” means, with respect to C&N, the actual knowledge of the individuals set forth on Appendix II. With respect to Susquehanna, “Knowledge” means the actual knowledge of the individuals set forth on Appendix II.
“Letter of Transmittal” has the meaning given to it in Section 2.1(e)
“Liens” has the meaning given to it in Section 3.4(c).
“Loans” has the meaning given to it in Section 3.25(a)
“Look Back Date” means December 31, 2024.
“Market” shall mean the NASDAQ Stock Market.
“Material Adverse Effect” means, with respect to Susquehanna, C&N or the Surviving Corporation, as the case may be, an event or circumstance that (i) has a material adverse impact on the business, properties, assets, liabilities, results of operations, financial condition or prospects of such Party and its Subsidiaries taken as a whole, provided however that “Material
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Adverse Effect” shall not be deemed to include the impact of the following: (A) changes, after the date hereof, in U.S. GAAP or applicable regulatory accounting requirements; (B) changes, after the date hereof, in laws, rules or regulations of general applicability to companies in the industries in which such Party and its Subsidiaries operate, or interpretations thereof by courts or Governmental Entities (including Pandemic Measures); (C) changes, events, or developments, after the date hereof, in global, national or regional political conditions (including the outbreak or escalation of war or hostilities, any occurrence or threat of acts of terrorism or any armed hostilities associated therewith and any national or international calamity, disaster, or emergency or any escalation thereof) or in economic or market conditions affecting the financial services industry generally and not specifically relating to such Party or its Subsidiaries, or other changes, events or developments, after the date hereof, that affect bank or savings associations or their holding companies generally (including any such changes arising out of a Pandemic or any Pandemic Measures), changes, after the date hereof, resulting from hurricanes, earthquakes, tornados, floods or other natural disasters or from any epidemic, pandemic, outbreak of any disease or other public health event (including the Pandemic); (D) the failure, in and of itself, of such Party to meet earnings projections or internal financial forecasts or any decrease in the market price of a Party’s common stock, but not including the underlying causes thereof, (E) disclosure or consummation of the transactions contemplated hereby or actions expressly required by this Agreement in contemplation of the transactions contemplated hereby, (F) any legal action asserted or other actions initiated by any holder of shares of Susquehanna Common Stock or the holder of shares of C&N Common Stock arising out of or related to this Agreement, (G) actions or omissions taken pursuant to the written consent or request of C&N, in the case of Susquehanna, or Susquehanna, in the case of C&N, or (H) the announcement of this Agreement and the transactions contemplated hereby, and compliance with this Agreement on the assets, business, financial condition or results of operations of the Parties and their respective Subsidiaries, including reasonable expenses incurred by the Parties hereto in consummating the transactions contemplated by this Agreement; except, with respect to subclauses (A), (B), (C) or (D), to the extent that the effects of such change are materially disproportionately adverse to the business, properties, assets, liabilities, results of operations, financial condition or prospects of such Party and its Subsidiaries as compared to other companies in the industry in which such Party and its Subsidiaries operate; or (ii) does or would reasonably be expected to materially impair the ability of either Susquehanna, on the one hand, or C&N on the other hand, to perform its obligations under this Agreement or otherwise materially threaten or materially impede the timely consummation of the transactions contemplated by this Agreement.
“Material Contract” means any of the following agreements of Susquehanna or any Susquehanna Subsidiary:
(1) any contract for outstanding debt securities, notes, credit agreements, credit facilities or other agreements, documents or instruments evidencing indebtedness in excess of $75,000 or by which Susquehanna or any Susquehanna Subsidiary is bound;
(2) any contract containing covenants that limit in any respect the ability of Susquehanna or any Susquehanna Subsidiary to compete in any line of business or with any person or which involve any material restriction of the geographical area in which, or method by which or with whom, Susquehanna or any Susquehanna Subsidiary may carry on its business (other than as may be required by law or applicable regulatory authorities), and any contract that could require
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the disposition of any material assets or line of business of Susquehanna or any Susquehanna Subsidiary;
(3) any joint venture, partnership, strategic alliance, or other similar contract (including any franchising agreement, but in any event excluding introducing broker agreements), and any contract relating to the acquisition or disposition of any business or assets (whether by merger, sale of stock or assets, or otherwise), which acquisition or disposition is not yet complete or where such contract contains continuing obligations or contains continuing indemnity obligations of Susquehanna or any Susquehanna Subsidiary;
(4) any real property lease and any other lease with annual rental payments aggregating $75,000 or more;
(5) other than with respect to loans, any contract providing for, or reasonably likely to result in, the receipt or expenditure of more than $200,000 on an annual basis, including the payment or receipt of royalties or other amounts calculated based upon revenues or income;
(6) any contract or arrangement under which Susquehanna or any Susquehanna Subsidiary is licensed or otherwise permitted by a third party to use any Intellectual Property that is material to its business (except for any “shrink wrap” or “click through” license agreements or other agreements for software that is generally available to the public and has not been customized for Susquehanna or any Susquehanna Subsidiary or under which a third party is licensed or otherwise permitted to use any Intellectual Property owned by Susquehanna or any Susquehanna Subsidiary);
(7) any contract that by its terms limits the payment of dividends or other distributions by Susquehanna or any Susquehanna Subsidiary;
(8) any standstill or similar agreement pursuant to which any Party has agreed not to acquire assets or securities of another Person;
(9) any contract that would reasonably be expected to prevent, delay, or impede Susquehanna’s or any Susquehanna Subsidiary’s ability to consummate the transactions contemplated by this Agreement;
(10) any contract providing for indemnification by Susquehanna or any Susquehanna Subsidiary of any person, except for immaterial contracts entered into in the Ordinary Course of Business;
(11) any contract that contains a put, call, or similar right pursuant to which Susquehanna or any Susquehanna Subsidiary could be required to purchase or sell, as applicable, any equity interests or assets that have a fair market value or purchase price of more than $200,000;
(12) any contract relating to (a) interest rate swaps or other derivative products or (b) wholesale funding, including federal funds, foreign deposits and brokered deposits; and
(13) any other contract or agreement which is a “material contract” within the meaning of Item 601(b)(10) of Regulation S-K; and
(14) any contract of Susquehanna or a Susquehanna Subsidiary that was, or was required to be, filed as an exhibit pursuant to Item 601(b)(10) of Regulation S-K (or would have been required if Susquehanna or a Susquehanna Subsidiary was subject to compliance with the Exchange Act of 1934).
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“Materials of Environmental Concern” shall mean pollutants, contaminants, wastes, toxic substances, petroleum and petroleum products, and any other hazardous or toxic materials regulated under Environmental Laws.
“Merger” has the meaning given to it in the Background.
“Merger Consideration” has the meaning given to it in Section 2.1(a)(i).
“Multiple Employer Plan” has the meaning given to it in Section 3.24(f).
“NASDAQ” shall mean the National Market System of the National Association of Securities Dealers Automated Quotation System.
“Nondisclosure and Confidentiality Agreement” means that certain Nondisclosure and Confidentiality Agreement between the Parties, dated December 12, 2024.
“Notice of Superior Proposal” has the meaning given to it in Section 5.8(e)
“Notice Period” has the meaning given to it in Section 12.1(h)
“OCC” means the Office of the Comptroller of Currency.
“Ordinary Course of Business” means the ordinary course of operations of a Person, consistent with its customary business practices.
“Pandemic” means any outbreaks, epidemics or pandemics relating to SARS-CoV-2 or COVID-19, or any evolutions or mutations thereof, or any other viruses (including influenza), and the governmental and other responses thereto.
“Pandemic Measures” means any quarantine, “shelter in place,” “stay at home,” workforce reduction, social distancing, shut down, closure, sequester or other laws, directives, policies, guidelines or recommendations promulgated by any Governmental Entity, including the Centers for Disease Control and Prevention and the World Health Organization, in each case, in connection with or in response to the Pandemic.
“Participation Facility” has the meaning given to it in Section 3.17(d).
“Parties” and “Party” means C&N and/or Susquehanna, as applicable in the context.
“PBGC” has the meaning given to it in Section 3.24(e).
“Pennsylvania Department” means the Pennsylvania Department of Banking and Securities.
“Pension Plan” means each Benefit Plan that is an “employee pension benefit plan” as defined in Section 3(2) of ERISA.
“Person” means an individual, partnership, limited partnership, corporation, limited liability company, association, trust, joint venture, unincorporated organization, labor union, Governmental Entity or other entity.
“Personal Information” means the type of information regulated by Privacy Laws and collected, used, disclosed or retained by a Party in its business including information regarding the customers, suppliers, employees and agents of such business, such as an individual’s name, address, age, gender, identification number, income, family status, citizenship, employment, assets, liabilities, source of funds, payment records, credit information, personal references and health records.
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“Prior Year” means the prior fiscal year of a Party.
“Privacy Laws” means all applicable federal, state, municipal or other legal requirements governing the collection, use, disclosure and retention of Personal Information.
“Susquehanna” has the meaning given to it in the Introduction.
“Susquehanna Balance Sheet” has the meaning given to it in Section 3.9.
“Susquehanna Bank” has the meaning given to it in the Background.
“Susquehanna Benefit Plans” has the meaning given to it in Section 3.24(a).
“Susquehanna Closing Documents” has the meaning given to it in Section 8.2(e).
“Susquehanna Common Stock” has the meaning given to it in the Background.
“Susquehanna Disclosure Schedule” has the meaning given to it in ARTICLE III.
“Susquehanna ERISA Affiliate” means any trade or business, whether or not incorporated, that together with Susquehanna or any Susquehanna Subsidiary would be deemed a “single employer” within the meaning of Section 4001(b) of ERISA.
“Susquehanna PEO Plans” has the meaning given to it in Section 3.24(a).
“Susquehanna Qualified Plans” has the meaning given to it in Section 3.24(d).
“Susquehanna Recommendation” has the meaning given to it in Section 5.2.
“Susquehanna Representatives” has the meaning given to it in Section 5.8(a)
“Susquehanna Share” and “Susquehanna Shares” have the meaning given to them in Section2.1(a)(i).
“Susquehanna Shareholders’ Meeting” means the meeting of Susquehanna for purposes of obtaining the approval of its shareholders as required by this Agreement, and any adjournment or postponement thereof.
“Susquehanna Subsidiaries” shall have the meaning given to it in Section 3.4(c).
“Susquehanna Subsidiaries Common Equity” has the meaning given to it in Section 3.4(c)
“Proxy Statement/Prospectus” has the meaning given to it in Section 3.5.
“Registration Statement” has the meaning given to it in Section 3.15.
“Regulatory Agency” and “Regulatory Agencies” have the meaning given to them in Section 3.15.
“Regulatory Agreement” has the meaning given to it in Section 3.15.
“Related Party Transaction” has the meaning given to it in Section 3.27.
“Requisite Shareholder Vote” has the meaning give to it in Section 3.2(a).
“SEC” means the United States Securities and Exchange Commission.
“Securities Act” has the meaning given to it in Section 2.2(c).
“Security Breach” has the meaning given to it in Section 3.18(b).
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“SRO” means (i) any “self-regulatory organization” as defined in Section 3(a)(26) of the Exchange Act and (ii) any other United States or foreign securities exchange, futures exchange, commodities exchange or contract market.
“Starting Date” has the meaning given to it in Section 12.1(h)
“Starting Price” has the meaning given to it in Section 12.1(h).
“Statement of Merger” has the meaning given to it in Section 9.2.
“Subsequent Determination” has the meaning given to it in Section 5.8(e)
“Subsidiary” means a corporation, partnership, joint venture or other entity in which C&N or Susquehanna, as the case may be, has, directly or indirectly, an equity interest representing 50% or more of any class of the capital stock thereof or other equity interests therein.
“Superior Proposal” has the meaning given to it in Section 5.8(b)
“Surviving Corporation” has the meaning given to it in Section 1.1(a)
“Takeover Statutes” has the meaning given to it in Section 3.34.
“Tax” or “Taxes” means all federal, state, local, and foreign income, excise, gross receipts, ad valorem, profits, gains, property, capital, sales, transfer, use, license, payroll, employment, social security, severance, unemployment, withholding, duties, excise, windfall profits, intangibles, franchise, backup withholding, value added, alternative or add-on minimum, estimated and other taxes, charges, fees, levies or like assessments together with all penalties and additions to tax and interest thereon.
“Tax Return” means any return, declaration, report, claim for refund, estimate, or information return or statement relating to Taxes, including any schedule or attachment thereto, and including any amendment thereof, supplied or required to be supplied to a Governmental Entity.
“Termination Date” means April 23, 2026.
“Termination Fee” has the meaning given to it in Section 12.1(b).
“Transitional Period” has the meaning given to it in Section 11.1(a).
“Unclaimed Shares” has the meaning given to it in Section 2.2
“Unexchanged Shareholder” has the meaning given to it in Section 2.2.
“Voting Agreements” has the meaning given to it in the Background.
“Willful Breach” has a meaning set forth in Section 12.2(b)(ii).
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APPENDIX II
C&N
Knowledge Groups
C&N: J. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇ ▇. ▇▇▇▇▇▇
Susquehanna: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
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EXHIBIT A
AGREEMENT AND PLAN OF BANK MERGER
THIS AGREEMENT AND PLAN OF BANK MERGER (this “Bank Merger Agreement”), dated as of April 23, 2025 is entered into by and between Citizens & Northern Bank (“C&N Bank”), a Pennsylvania bank with its main office located at ▇▇-▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, and Susquehanna Community Bank (“Susquehanna Bank”), a Pennsylvania bank with its main office located at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇.
BACKGROUND
AGREEMENT
In consideration of the premises and of the mutual covenants and agreements herein contained, C&N Bank and Susquehanna Bank, intending to be legally bound hereby, agree to the following terms:
ARTICLE I
MERGER; NAME; BUSINESS; APPROVALS
| a. | Board of Directors’ Approval. The Plan of Merger has been approved by: (I) all of the members of the Board of Directors of C&N Bank at a meeting held on April 23, 2025; and (II) all of the members of the Board of Directors of Susquehanna at a meeting held on April 23, 2025. |
| b. | Shareholder Approvals. The Plan of Merger was approved and adopted by: (I) all of the members of the Board of Directors of C&N, as the sole shareholder of C&N Bank, on April 23, 2025; and (II) all of the members of the Board of Directors of Susquehanna, as the sole shareholder of Susquehanna Bank, on April 23, 2025. |
ARTICLE II
CHARTER AND BYLAWS
At the Effective Time, the Articles of Incorporation and Bylaws of C&N Bank in effect immediately before the Effective Time shall be the Articles of Incorporation and Bylaws of the Resulting Bank. No amendments to the Articles of Incorporation and Bylaws of the Resulting Bank shall be made in connection with the Bank Merger.
ARTICLE III
BOARD OF DIRECTORS AND OFFICERS
ARTICLE IV
CONVERSION OF SHARES
ARTICLE V
EFFECTIVE TIME OF THE BANK MERGER
The Bank Merger shall become effective at the time (the “Effective Time”) at which the merger of Susquehanna with and into C&N pursuant to the Holding Company Merger Agreement shall become effective, which time shall be (1) after both (i) the date on which the Pennsylvania Department of Banking and Securities and the Federal Reserve Bank shall have approved the Bank Merger, or waived any applicable approval requirement in writing, and (ii) the date of receipt of any other approvals required to consummate the Bank Merger; and (2) as set forth in the Articles of Merger filed to effectuate the Bank Merger.
ARTICLE VI
EFFECT OF THE BANK MERGER
At and after the Effective Time, the Bank Merger shall have the effects set forth in the applicable provisions of the Pennsylvania Banking Code of 1965, as amended, and the Bank Merger Act, 12 U.S.C. 1828(c). At the Effective Time, the Resulting Bank shall assume all liabilities of Susquehanna Bank.
ARTICLE VII
CONDITIONS PRECEDENT
The obligations of C&N Bank and Susquehanna Bank to effect the Bank Merger shall be subject to the receipt of all required regulatory approvals and the consummation of the merger of Susquehanna with and into C&N, as set forth in the Holding Company Merger Agreement.
ARTICLE VIII
TERMINATION
This Bank Merger Agreement shall automatically terminate upon any termination of the Holding Company Merger Agreement.
ARTICLE IX
MISCELLANEOUS
[Signature page immediately follows]
IN WITNESS WHEREOF, the parties have caused this Agreement and Plan of Bank Merger to be executed by their duly authorized officers and their corporate seals to be hereunto affixed as of the date first written above.
Susquehanna Community Bank
By:/s/ ▇▇▇▇▇ ▇. ▇▇▇▇
Citizens & Northern Bank
By:/s/ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
SCHEDULE 3.1
DIRECTORS OF RESULTING BANK
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
J. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
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▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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EXHIBIT B
VOTING AGREEMENT
April 23, 2025
Board of Directors
Citizens & Northern Corporation
▇▇-▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Re: Shareholder Voting Agreement
Dear Ladies and Gentlemen:
The undersigned shareholder (“Shareholder”) of Susquehanna Community Financial, Inc., a Pennsylvania corporation (“Susquehanna”), in order to induce Citizens & Northern Corporation, a Pennsylvania corporation (“C&N”), to enter into the Agreement and Plan of Merger, of even date herewith, executed by and between Susquehanna and C&N (the “Agreement”), hereby represents, warrants and agrees as follows:
1. Shareholder hereby represents and warrants that Shareholder owns of record, or beneficially, good and valid title to all of the shares of the capital stock of Susquehanna shown on Schedule 1, attached hereto, free and clear of any and all mortgages, liens, encumbrances, charges, claims, restrictions, pledges, security interests, voting trusts or agreements, or impositions, except as otherwise disclosed on Schedule 1, and such shares represent all of the shares of capital stock of Susquehanna beneficially owned by Shareholder, as determined in accordance with Securities and Exchange Commission (“SEC”) Rule 13d-3. For purposes hereof, the capital stock of Susquehanna set forth on Schedule 1 shall be referred to herein as the “Shares”. It is understood and agreed that the term Shares shall not include any securities beneficially owned by Shareholder as a trustee or fiduciary, and that this Agreement is not in any way intended to affect the exercise by the Shareholder of Shareholder’s fiduciary responsibility with respect to any such securities.
2. Shareholder will vote, or cause to be voted, all of the Shares over which the Shareholder has sole voting power, in person or by proxy, (a) for approval of the Agreement and the transactions contemplated thereby at any meeting of the Susquehanna shareholders duly held for such purpose and (b) against any action that is intended, or could reasonably be expected, to impede, interfere with, delay, postpone, or adversely affect the transactions contemplated by the Agreement, unless and until the Agreement is terminated as set forth therein (the “Expiration Date”). Shareholder will use his or her reasonable efforts to cause any Shares over which Shareholder shares voting power to be voted in the same manner. Shareholder will use his or her best efforts to vote or cause to be voted all other Shares, in person or by proxy, in accordance with Section 2(a) and 2(b), above.
3. Shareholder will not, nor will Shareholder permit any entity under Shareholder’s control to, deposit any of the Shares over which the Shareholder holds or shares voting power in a voting trust
or subject any of the Shares to any arrangement with respect to the voting of the Shares in any manner inconsistent with this Agreement.
4. Shareholder will not sell, transfer, pledge, give, hypothecate, assign or otherwise alienate or transfer, by proxy or otherwise, any Shares over which the Shareholder shares or holds the power of disposition or any of Shareholder’s voting rights with respect to the Shares, except to a person who is or becomes a party to a voting agreement with C&N in the form of this Agreement.
5. Irreparable damage would occur in the event any of the provisions of this Agreement are not performed in accordance with the terms hereof and, therefore, C&N shall be entitled to specific performance of the terms hereof, in addition to any other remedy at law or equity to which it may be entitled.
6. The execution and delivery of this Agreement by Shareholder does not, and the performance by Shareholder of its obligations hereunder will not, constitute a violation of, conflict with, result in a default (or an event which, with notice or lapse of time or both, would result in a default) under, or result in the creation of any lien on any of such Shares under: (i) any contract, commitment or agreement, to which Shareholder is a party or by which Shareholder is bound; or (ii) any judgment, order or ruling applicable to Shareholder.
7. Shareholder has full power and authority to execute, deliver and perform this Agreement, to vote the Shares over which the Shareholder holds sole voting power as required herein and to consummate the transactions contemplated hereby. The execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby have been duly and validly authorized, and no other actions on the part of Shareholder are required in order to consummate the transactions contemplated hereby. This Agreement has been duly and validly executed and delivered by Shareholder and constitutes a valid and binding agreement of Shareholder, enforceable against Shareholder in accordance with its terms.
8. Shareholder understands that the shares of C&N Common Stock into which his or her Shares may be converted will be issued in a transaction subject to the Securities Act of 1933, as amended (the “1933 Act”), and registered on a Registration Statement on Form S-4. Shareholder further understands that, should he or she become an affiliate of C&N, within the meaning of SEC Rule 144, Shareholder may become subject to certain restrictions with respect to the sale, transfer or other disposition of any C&N Common Stock received in connection with the transactions contemplated by the Agreement (the “Merger”).
Accordingly, the Shareholder acknowledges, agrees and undertakes that, if he or she becomes an affiliate of C&N, he or she will not, directly or indirectly, make any sale, transfer or other disposition of any of the C&N Common Stock owned beneficially by him or her as a result of the Merger unless: (i) such sale, transfer or other disposition is made pursuant to an effective registration or a valid exemption from registration under the 1933 Act; (ii) such sale, transfer or other disposition is made pursuant to the resale provisions contained in Rule 144; or (iii) in the opinion of counsel in form and substance reasonably satisfactory to C&N or under a “no-action” letter obtained by Shareholder from the staff of the SEC, such sale, transfer or other disposition will not violate the registration requirements of, or is otherwise exempt from registration under,
the 1933 Act. Shareholder agrees that a restrictive legend reflecting the foregoing may be imprinted on the face of the stock certificate(s) representing the C&N Common Stock to be issued to him or her in connection with the Merger. Shareholder further understands and agrees that the transfer agent for C&N will be instructed not to effect, or to record on the books of C&N, any transfer of shares of C&N Common Stock owned beneficially by Shareholder unless such person has satisfied the requirements of this Agreement.
9. This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all other prior agreements and understandings, both written and oral, between the parties with respect to the subject matter hereof, and shall be binding upon the heirs, successors and assigns (as applicable) of the parties hereto.
10. Except as otherwise set forth herein, this Agreement will be governed by and construed in accordance with the laws of the Commonwealth of Pennsylvania regardless of the laws that might otherwise govern under applicable principles of conflicts of laws thereof.
11. Capitalized terms not otherwise defined herein shall have the meanings given to them in the Agreement.
12. It is understood and hereby agreed that this Agreement relates solely to the capacity of Shareholder as a shareholder or beneficial owner of the Shares and is not in any way intended to affect the exercise of Shareholder’s responsibilities and fiduciary duties as a director or officer of Susquehanna or any of its subsidiaries.
13. This Agreement shall terminate and shall have no further force or effect as of the earlier of (A) the Expiration Date or (B) the Susquehanna Shareholder’s Meeting (including any adjournment or postponement thereof).
[Signature Page Follows]
Very truly yours,
By: ________________________________
Printed Name: [•]
Schedule 1
NameClass of SharesNumber of Shares
Encumbrances: