Letter to Orange County Business Bank from Shareholders Representing 13.48% of OCBB Common Stock

By: Commerce Street Investment Management
 
IRVINE, Calif. - Feb. 25, 2015 - PRLog -- Led by Commerce Street Investment Management (http://www.commercestreetcapital.com/root/commercestreet/investment-management.asp) (“CSIM”), shareholders representing 13.48% of OCBB common stock sent the following letter to the Corporate Secretary and the Board of Directors of Orange County Business Bank (OTCQB- OCBB (http://www.otcmarkets.com/stock/OCBB/)) on the evening of Feb. 24, 2015.

February 24, 2015

Ms. Elaine Crouch

Corporate Secretary

Orange County Business Bank

Dear Ms. Crouch:

The undersigned write to invoke their collective and individual rights as shareholders of Orange County Business Bank (hereinafter referred to as the “Bank” or “Corporation”) pursuant to the Bylaws adopted by the Corporation on March 24, 2006, and implemented on August 1, 2006. [Note: You were kind enough to forward a copy of both the Articles of Incorporation of Orange County Business Bank (the “Articles”) and the Bylaws of Orange County Business Bank (the “Bylaws”) to Service Equity Partners, LP (“SEP”) on June 21, 2010 (the “SEP Correspondence”).]

The purpose of this correspondence is to formally request certain information from the Bank pursuant to the Bank’s Articles and Bylaws. The undersigned are entitled to make these requests as they are holders in aggregate of 636,782 shares, representing 13.48% of the Bank’s common equity entitled to cast votes at the annual meeting of shareholders.

The first request concerns Article VII of the Bylaws entitled “AMENDMENTS.” Sections 7.1 and 7.2 describe the process by which amendments to the Articles and Incorporation and Bylaws may be proposed and approved.

First Request: Please provide to Service Equity Partners, LP (“SEP”) copies of any amendments to the Articles and Bylaws since August 1, 2006 which were proposed, and indicate whether these amendments were adopted or rejected by the Bank’s Board. If there were no amendments proposed and therefore, none adopted, please provide us with this information as the last versions of the Articles and Bylaws were provided as an attachment to the SEP Correspondence. If you determine not to provide the requested information, then the undersigned formally invokes the rights provided under Article VI, Section 6.2 entitled “INSPECTION OF BYLAWS.” For the purpose of this request and pursuant to Article VI, Section 6.1(d), the undersigned designate Mark R. Ruh as their agent for the purpose of inspection and copying of the Bylaws as amended to date.

Second Request: This request is made pursuant to the “absolute right” granted to the Bank’s shareholders in Article VI of the Bylaws entitled “OTHER PROVISIONS.” Specifically, Section 6.1(a) entitles the undersigned in their collective capacity to “inspect and copy the record of shareholders’ names and addresses and shareholdings during normal business hours upon five business days’ prior written demand upon the corporation” (hereinafter referred to as “Shareholders List”). This letter constitutes prior written notice. The designated agent(s) for the purpose of inspecting and copying the Shareholders List on behalf of the undersigned will be Mark R. Ruh and/or Thomas J. Lykos, Jr. pursuant to Article VI, Section 6.1(d). Experience has informed SEP that providing a copy of the Shareholders List at an agreed time (during business hours) and date as soon as practical after the fifth business day with a designated official of the Bank facilitates the delivery of the requested information.

If the timely provision of a copy of the Shareholders List should prove an inconvenience to the Corporation, then the undersigned invoke their right to receive a copy of the list from the Bank’s transfer agent pursuant to the provisions of Article VI, Section 6.1(a) (ii). We will take every reasonable step to work with the transfer agent to obtain the list even though “[t]he corporation shall have a responsibility to cause the transfer agent to comply with this Section 6.1.”  To avoid any delay or misunderstanding, please provide the name and contact information for the transfer agent and a copy of the Corporation’s instruction to the transfer agent directing the release of the Shareholders List pursuant to this request of the undersigned. The most recent record date for which the list should be completed for the purpose of this request is March 5, 2015, as this is a date five business days after the receipt of this demand.

Third Request: In addition, pursuant to Section 6.1(b) and Section 6.1(c), this correspondence shall constitute a written demand and notice to inspect the Shareholders List as provided in Section 6.1(b) and the “accounting books and records and minutes of the proceedings of the shareholders and the board and committees of the board shall be open to inspection upon written demand on the corporation by any shareholder… at any reasonable time during usual business hours for a purpose reasonably related to such holder’s interest as a shareholder….” as provided in Section 6.1(c). The purpose for the inspection of these records is to review the Board’s strategy for pursuing its stated objectives of pursuing material organic growth, acquisitive growth, and top quartile peer profitability, and whether its actions have been consistent with the maximization of shareholder value consistent with the exercise of the fiduciary duties owed to all shareholders. The undersigned shareholders have serious concerns about the Board’s execution of its duties due to the recent “stonewalling” of SEP’s December 9, 2014 request for a meeting to discuss the issues identified in this correspondence to the Board and its Chairman.

Should you have any questions regarding these requests for information, or wish to dispute the rights to provide the undersigned shareholders with the requested information, please contact Mr. Thomas J. Lykos, Jr. (at TLykos@CStreetInv.com). Otherwise, please inform Mr. Mark R. Ruh (at MRuh@CStreetInv.com) of the date the Shareholders List will be provided and a mutually convenient date, time and representative of the Bank with whom he can inspect the other requested documents as provided by the Bylaws.

Sincerely,

Mark R. Ruh, Managing Director & Thomas J. Lykos, Managing Director & General Counsel

Commerce Street Investment Management/ Service Equity Partners, LP

Raju Shah

Craton Capital Management, LLC/ Craton Capital LP

Brad L. Champlin

Former Director, Orange County Business Bank

Allan T. Gibson

Former EVP & Chief Operating Officer, Orange County Business Bank

Greg Savino

Former EVP & Chief Credit Officer, Orange County Business Bank

Floyd Briney

[Note: Five additional OCBB shareholders signed the letter sent on February 24, 2015.]

Contact
Krystal Morris, C. Pharr & Co. for Commerce Street
***@pharrpr.com
End
Source:Commerce Street Investment Management
Email:***@pharrpr.com Email Verified
Tags:CSIM, OCBB, Orange County, Banking, Stock
Industry:Banking, Financial
Location:Irvine - California - United States
Subject:Reports
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