TBBK Bancorp Inc

SELLING STOCKHOLDERS

The shares of common stock being offered by the selling stockholders consist of shares previously issued to the selling stockholders, and shares issued upon the conversion of our Series C mandatorily convertible cumulative non-voting perpetual preferred stock, par value $0.01 per share, or the Series C Preferred Shares, held by the selling stockholders as a result of the special meeting of stockholders of the Company held on September 29, 2016.  For additional information regarding the issuances of those shares and the Series C Preferred Shares, see "Private Placement of Common Shares and Series C Preferred Shares" below.

The table below lists the selling stockholders and other information regarding the beneficial ownership of the shares of common stock held by each of the selling stockholders. The second column lists the number of shares beneficially owned (unless indicated otherwise in footnotes) by each selling stockholder as of September 29, 2016. The third column lists the shares being offered by the selling stockholders pursuant to this prospectus. The fourth column assumes the sale of all of the shares offered by the selling stockholders pursuant to this prospectus. The selling stockholders may sell all, some or none of their shares in this offering. See "Plan of Distribution."

The information set forth below is based on information provided by or on behalf of the selling stockholders prior to the date hereof. Information concerning the selling stockholders may change from time to time. The selling stockholders may from time to time offer and sell any or all of the shares under this prospectus. Because the selling stockholders are not obligated to sell shares, we cannot state with certainty the amount of shares that the selling stockholders will hold upon consummation of any such sales. In addition, since the date on which the selling stockholders provided this information to us, such selling stockholders may have sold, transferred or otherwise disposed of all or a portion of their shares. We are registering the shares to permit each selling stockholder to resell the shares when such stockholder deems appropriate, subject to the restrictions on transfer set forth under "Plan of Distribution."

To our knowledge, except for the ownership of the shares of common stock and as described below, the selling stockholders have not had any material relationship with us within the past three years. Also to our knowledge and except as indicated otherwise in footnotes below and pursuant to applicable community property laws, the persons named in the table have sole voting and investment power with respect to all shares shown as beneficially owned by them. The address for each of the officers or directors listed in the table below is c/o The Bancorp, Inc., 409 Silverside Road, Wilmington, DE 19809.

 

* Less than 1%

 

 

 

 

 

 

(1)

"Beneficial ownership" is a term broadly defined by the SEC in Rule 13d-3 under the Exchange Act, and includes more than the typical form of stock ownership, that is, stock held in the person's name. The term also includes what is referred to as "indirect ownership," meaning ownership of shares as to which a person has or shares investment power. For purposes of this table, a person or group of persons is deemed to have "beneficial ownership" of any securities that are currently exercisable or exercisable within 60 days of September 29, 2016.

(2)

The selling stockholder is an affiliate of a broker-dealer, Wellington Management Advisers, Inc. The selling stockholder purchased the securities in the ordinary course of business and at the time of the purchase of the securities, the selling stockholder had no agreements or understandings, directly or indirectly, with any person to distribute the securities.

(3)

Nantahala Capital Management, LLC is a Registered Investment Advisor and has been delegated the legal power to vote and/or direct the disposition of securities on behalf of these entities as a General Partner or Investment Manager and would be considered the beneficial owner of such securities.  The above shall not be deemed to be an admission by the record owners or these Selling Stockholders that they are themselves beneficial owners of these shares of common stock for purposes of Section 13(d) of the Exchange Act or any other purpose.

(4)

John M. Eggemeyer, Mark G. Merlo, John T. Pietrzak and J. Mikesell Thomas are each individually managing principles of Castle Creek Capital VI LLC, the sole general partner of the selling stockholder and each individual equally shares voting and/or investment power of the common shares held by the selling stockholder.  Our board of directors resolved to appoint Mr. Eggemeyer as a director.  Mr. Eggemeyer's appointment will be effective upon completion of regulatory review, non-objection or approval as required by applicable law.  During the pendency of the regulatory review period, Mr. Eggemeyer will be a non-voting observer to our board of directors.

(5)

Abdulmohsin Al Omran, Adel Al Mangour, Arup Asadullah and Jon P. Hedley are Directors of TFO Financial Institutions Restructuring Fund III SPC, which is the managing member of the selling stockholder. Dragomir Kolev is the Portfolio Manager of TFO Financial Institutions Restructuring Fund III SPC. Each individual has voting and/or investment power over the common shares held by the selling stockholder.

(6)

Stieven Capital GP, LLC is the general partner of Stieven Financial Investors, L.P., and in such capacity has voting and investment control over the shares held by this selling stockholder.  Stieven Capital Advisors, L.P. is the investment manager of Stieven Financial Investors, L.P and Stieven Financial Offshore Investors, Ltd., and in such capacity has voting and investment control over the shares held by both of these selling stockholders.  Joseph A. Stieven, Stephen L. Covington, Daniel M. Ellefson and Mark J. Ross are members of the general partner and managing directors of the investment manager, and as a result, they may each be deemed to have voting and investment control over shares held by both of these selling stockholders.

(7)

Josiah Hornblower and Shivan Govindan, the Managing Members of the selling stockholder's sole shareholder, share voting and/or investment power of the common shares held by the selling stockholder.  Our board of directors resolved to appoint Mr. Govindan as a director.  Mr. Govindan's appointment will be effective upon completion of regulatory review, non-objection or approval as required by applicable law.  During the pendency of the regulatory review period, Mr. Govindan will be a non-voting observer to our board of directors.

(8)

Emigrant Bank is the sole member of the selling stockholder and is a wholly owned subsidiary of Emigrant Bancorp, Inc. ("Emigrant Bancorp").  Emigrant Bancorp is a wholly owned subsidiary of New York Private Bank & Trust Corporation ("NYPB&TC"), and the Paul Milstein 1998 CONTINUATION TRUSTS A, B and C (the "Trusts") own 100% of the voting stock of NYPB&TC.  Howard P. Milstein is the Chairman, President and Chief Executive Officer of NYPB&TC, Emigrant Bancorp and Emigrant Bank and is the President and Chief Executive Officer of the PIM Trust Company, the trustee of the Trusts.  As a result of the foregoing, each of the selling stockholder, Emigrant Bank, Emigrant Bancorp, NYPB&TC, the Trusts and Howard P. Milstein may be deemed to beneficially own the common shares held directly by the selling stockholder.  Emigrant Bank, Emigrant Bancorp, NYPB&TC, the Trusts and Howard P. Milstein disclaim beneficial ownership of such common shares.  The selling stockholder is an affiliate of a broker-dealer. GSP Securities, LLC, a registered broker- dealer, is a majority-owned subsidiary of Emigrant Bancorp. The selling stockholder purchased the securities in the ordinary course of business and at the time of the purchase of the securities, the selling stockholder had no agreements or understandings, directly or indirectly, with any person to distribute the securities.

(9)

David Brown is the Managing Member of Hawk Ridge Capital Management, L.P, the Investment Manager of the selling stockholder and has voting and/or investment power over the common shares held by the selling stockholder.

(10)

FSI Group, LLC is controlled by John M. Stein and Steven N. Stein and is the general partner of Financial Stocks Limited Partnership, which is the record owner of the common shares and over which FSI Group, LLC has trading discretion. Therefore, FSI Group, LLC, John M. Stein and Steven N. Stein share with Financial Stocks Limited Partnership the power to vote and dispose of such shares, and, accordingly, may be deemed the beneficial owners of such shares. FSI Group, LLC, Steven N. Stein and John M. Stein disclaim beneficial ownership of the shares owned by Financial Stocks Limited Partnership, except to the extent of their pecuniary interest therein.

 

 

 

 

 

(11)

Thomas K. Brown is the Portfolio Manager of the selling stockholder and has voting and/or investment power over the common shares held by the selling stockholder.

(12)

Joel S. Lawson IV is the Managing Member of the selling stockholder and has voting and/or investment power over the common shares held by the selling stockholder.

(13)

[Reserved]

(14)

Mr. Chrystal is our former Interim Chief Executive Officer and is currently a director.  Holdings consist of: (a) 238,500 common shares owned directly, (b) 5,000 common shares issuable upon exercise of options and (c) 1,307 common shares held in a 401(k) plan account for the benefit of Mr. Chrystal.

(15)

Mr. Cohen is our Chairman.  Holdings consist of: (a) 572,281 common shares owned directly; (b) 200,000 common shares issuable upon exercise of options; (c) 235 common shares held in a 401(k) plan account for the benefit of Mr. Cohen; (d) 315,000 common shares owned by a charitable foundation of which Mr. Cohen is a co-trustee; and (e) 220,000 shares held by a grandchildren's trust of which Mr. Cohen is a co-trustee. Mr. Cohen is an affiliate of a broker-dealer. Mr. Cohen purchased the securities in the ordinary course of business and at the time of the purchase of the securities, he had no agreements or understandings, directly or indirectly, with any person to distribute the securities.

(16)

Mr. Daniel Cohen, our Chairman, is a co-trustee of the trust. Mr. Cohen is an affiliate of a broker-dealer. Mr. Cohen purchased the securities in the ordinary course of business and at the time of the purchase of the securities, he had no agreements or understandings, directly or indirectly, with any person to distribute the securities.

(17)

Mr. Beach is our director.  Holdings consist of: (a) 330,829 common shares owned directly; (b) options to purchase 28,000 common shares; and (c) 938,989, common shares owned by various accounts managed by Beach Investment Counsel, Inc., Beach Asset Management, LLC or Beach Investment Management, LLC, investment management firms for which Mr. Beach is a principal and which possess investment and/or voting power over the shares.

(18)

Mr. McEntee is a member of our board of directors.  Holdings consist of: (a) 198,084 common shares owned directly and (b) 26,000 common shares issuable upon exercise of options.  Mr. McEntee is an affiliate of a broker-dealer. Mr. McEntee purchased the securities in the ordinary course of business and at the time of the purchase of the securities, he had no agreements or understandings, directly or indirectly, with any person to distribute the securities.

(19)

Mr. Kozlowski is our Chief Executive Officer and a director.  Holdings consist of: (a) 50,000 common shares held directly and (b) 9,790 common shares held in a 401(k) plan account for the benefit of Mr. Kozlowski.

(20)

Mr. Frenkiel is our Chief Financial Officer.  Holdings consist of: (a) 17,500 common shares owned directly, (b) 156,000 common shares issuable upon exercise of options and (c) 5,222 common shares held in a 401(k) plan account for the benefit of Mr. Frenkiel.

(21)

Mr. Kuiper is our Managing Director.  Holdings consist of: (a) 17,500 common shares owned directly, (b) 148,000 common shares issuable upon exercise of options and (c) 1,641 common shares held in a 401(k) plan account for the benefit of Mr. Kuiper.

(22)

Mr. McGraw is our Executive Vice President and Chief Credit Officer.  Holdings consist of: (a) 33,415 common shares owned directly, (b) 140,500 common shares issuable upon exercise of options and (c) 7,306 common shares held in a 401 (k) plan account for the benefit of Mr. McGraw.

 

Private Placement of Purchased Common Shares and Series C Preferred Shares

On August 5, 2016, we entered into a Securities Purchase Agreement, or the securities purchase agreement, with the selling stockholders pursuant to which we sold an aggregate of 7,560,000 shares of our common stock at a purchase price of $4.50 per share, and 40,000 Series C Preferred Shares at a purchase price of $1,000 per share, in a private placement, for total consideration of approximately $74 million. We also entered into a subscription agreement dated as of August 5, 2016, or the subscription agreement, with certain of our directors and executive officers.  Pursuant to the subscription agreement, on September 29, 2016, upon receiving the affirmative vote of a majority of the shares of common stock eligible to vote at the special meeting, we sold 1,025,000 shares of common stock to certain of our directors and executive officers at $4.50 per share, for total consideration of approximately $4.6 million.  Also on September 29, 2016, pursuant to the terms of the Series C Preferred Shares, upon receiving the affirmative vote of a majority of the shares of common stock eligible to vote at our special meeting held on September 29, 2016, the Series C Preferred Shares were converted into approximately 8,888,888 shares of common stock.

The foregoing summary descriptions of the securities purchase agreement and subscription agreement do not purport to be complete and are qualified in their entirety by reference to the full text of such agreements, which are incorporated by reference into the registration statement of which this prospectus is a part.

 

 

 

 

 

Directors and Officers; Side Letters

John Chrystal, our former Interim Chief Executive Officer and a member of our board of directors, Daniel Cohen, our Chairman, Damian Kozlowski, our Chief Executive Officer and a member of the board of directors, Paul Frenkiel, our Chief Financial Officer, Jeremy Kuiper, our Managing Director of Payment Solutions, Donald McGraw, our Executive Vice President and Chief Credit Officer, and Walter Beach and James McEntee III, who are members of our board of directors, are parties to the subscription agreement and are selling stockholders.

Pursuant to the terms of the securities purchase agreement, two investors, Pilgrims & Indians Capital LLC, or P&I, and Castle Creek Capital, or CC, entered into side letter agreements with us. Under the terms of the side letter agreements, each of P&I and CC are each entitled to have one representative appointed to our board of directors for so long as each entity, together with its respective affiliates, owns, in the aggregate, 4% or more of all of our outstanding common stock.  If P&I or CC hold less than 4% of all of the outstanding common shares, but 50% or more of their shares purchased in the private placement, then such investor will be entitled to have one representative attend all meetings of our board of directors as a nonvoting observer for so long as such entity, together with its respective affiliates, owns, in the aggregate, 50% or more of the shares it purchased in the private placement. On August 17, 2016, our board of directors resolved to appoint John Eggemeyer and Shivan Govindan as directors in satisfaction of the side letter agreements.  Mr. Eggemeyer's and Mr. Govindan's respective appointments will be effective upon completion of regulatory review, non-objection or approval as required by applicable law.  During the pendency of the regulatory review period, Mr. Eggemeyer and Mr. Govindan will be non-voting observers to our board of directors.  The foregoing description of the side letters do not purport to be complete and are qualified in their entirety by the forms of the side letters attached as exhibits to the securities purchase agreement, incorporated by reference into the registration statement of which this prospectus is a part.

Registration Rights Agreement

In connection with the private placement discussed above, we entered into a registration rights agreement dated as of August 5, 2016, or the registration rights agreement, with each of the purchasers under the securities purchase agreement and the directors and officers parties to the subscription agreement. Pursuant to the terms of the registration rights agreement, we agreed to file a resale registration statement by no later than October 15, 2016 for the purpose of registering the resale of the common shares issued in the private placement and the shares of common stock issuable upon conversion of the Series C Preferred Shares. We have agreed to use commercially reasonable efforts to have the registration statement declared effective with the SEC as soon as practical, but not later than the 90th day from August 5, 2016 (or, in the event the SEC reviews and has written comments to the registration statement, the 120th calendar day from August 5, 2016).

In addition, the selling stockholders have the right to demand that we register their shares of common stock for sale in registered underwritten offerings, with a requirement that such demand be made by one or more selling stockholders holding not less than $20 million of common shares.  The selling stockholders also have piggyback rights to register their shares of common stock in other registered underwritten offerings of equity securities conducted by us, subject to customary cutbacks.

We must pay all fees and expenses related to our obligations under the registration rights agreement, except underwriting discounts and commissions, if any, which must be paid by the selling stockholders.  In addition, the registration rights agreements provide that we will indemnify the selling stockholders whose shares are covered by this prospectus or a prospectus supplement against losses, claims, damages, liabilities, judgments, costs and expenses arising out of any untrue statement or alleged untrue statement of a material fact or omission or alleged omission of a material fact contained in such prospectus or prospectus supplement or other violation of applicable laws that occurred in connection with registration of shares under the registration rights agreements.  The selling stockholders whose shares are covered by this prospectus or prospectus supplement will severally indemnify us against losses, claims, damages, liabilities, judgments, costs and expenses arising out of any untrue statement or alleged untrue statement of a material fact or omission or alleged omission of a material fact contained in this prospectus or prospectus supplement to the extent that such untrue statement was made in reliance upon information provided by such selling stockholders.  The registration rights for the shares of common stock held by the selling stockholders cease when: (a) a registration statement covering such shares is effective and such shares have been sold or disposed of pursuant to such effective registration statement; (b) such shares have been disposed of pursuant to any section of Rule 144 (or any similar provision then in force) under the Securities Act; (c) such shares are held by us or one of our subsidiaries; (d) such shares become eligible for sale without volume or manner of sale restrictions under Rule 144 by the holder thereof, and we are not required to be in compliance with the current public information requirements under Rule 144(c)(1) (or Rule 144(i)(2), if applicable) (except that, with respect to the demand rights for underwritten offerings and piggy-back rights, then registration rights continue notwithstanding eligibility to freely sell shares under Rule 144); or (e) such shares have been sold in a private transaction in which the transferor's rights under the registration rights agreement are not assigned to the transferee of such securities.