Company: OSBC
Filing Date: 2025-05-06
Form Type: S-4/A
Source: 0001104659-25-045103
Chunk: 122

Company: OLD SECOND BANCORP INC
Filing Date: 2025-05-06
Form: S-4/A
Chunk 122
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as discussed below), in which case such gain will be treated as dividend income to the extent of the U.S. holder’s ratable share of Bancorp Financial’s current and accumulated earnings and profits as calculated for U.S. federal income tax purposes.

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In general, the determination of whether any gain recognized will be treated as capital gain or a dividend distribution will depend on whether, and to what extent, the merger reduces the U.S. holder’s deemed percentage stock ownership in Old Second, taking into account certain constructive ownership rules. The IRS has indicated in rulings that any reduction in the interest of a stockholder that owns a small number of shares in a publicly and widely held corporation and that exercises no control over corporate affairs would result in capital gain as opposed to dividend treatment.

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Because the possibility of dividend treatment depends primarily upon a U.S. holder’s particular circumstances, including the application of constructive ownership rules, U.S. holders should consult their tax advisors regarding this possibility.

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A U.S. holder generally will have an aggregate tax basis in the shares of Old Second common stock received by the U.S. holder in the merger (including any fractional share of Old Second common stock deemed received and redeemed for cash, as discussed below) equal to the U.S. holder’s aggregate adjusted tax basis in the shares of Bancorp Financial common stock surrendered, reduced by the amount of cash received (other than cash received in lieu of a fractional share of Old Second common stock), and increased by the amount of any gain recognized or amount treated as a dividend by the U.S. holder (excluding any gain recognized with respect to cash received in lieu of a fractional share of Old Second common stock).

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The holding period of the shares of Old Second common stock received by a U.S. holder in the merger (including any fractional share of Old Second common stock deemed received and redeemed for cash, as discussed below) will include the holding period of the shares of Bancorp Financial common stock surrendered.

If a U.S. holder exchanges more than one “block” of shares of Bancorp Financial common stock (that is, groups of shares that the U.S. holder acquired at different times or at different prices), the U.S. holder must calculate gain, adjusted tax basis and holding period separately as to each block of shares. Any such U.S. holder should consult with his, her or its own tax advisors regarding the manner in which shares of Old Second common stock and cash received in the merger should be allocated