Document:

Exhibit 4.2
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Description of Registrant’s Securities
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Unless otherwise indicated or the context otherwise requires, references in this Exhibit 4.2 to “we, “us” and “our” refer collectively to TEB MHC, TEB Bancorp, Inc. and The Equitable Bank, S.S.B. or to any of those entities, depending on the context. In addition, we may refer to The Equitable Bank, S.S.B. as “The Equitable Bank.”
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General
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TEB Bancorp, Inc. is authorized to issue 20,000,000 shares of common stock having a par value of $0.01 per share and 5,000,000 shares of serial preferred stock, par value of $0.01 per share. Each share of TEB Bancorp, Inc.’s common stock will have the same relative rights as, and will be identical in all respects with, each other share of common stock. All outstanding shares of our common stock are duly authorized, fully paid and nonassessable.
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Our board of directors can, without stockholder approval, issue additional shares of common stock, although TEB MHC, so long as it is in existence, must own a majority of TEB Bancorp, Inc.’s outstanding shares of common stock. TEB Bancorp, Inc.’s issuance of additional shares of common stock could dilute the voting strength of the holders of the common stock and may assist management in impeding an unfriendly takeover or attempted change in control. TEB Bancorp, Inc. has no present plans to issue additional shares of common stock.
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Common Stock
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Distributions. TEB Bancorp, Inc. may pay dividends on its common stock if, after giving effect to such dividends, it would be able to pay its debts in the usual course of business and its total assets would exceed the sum of its total liabilities plus the amount needed to satisfy the preferential rights upon dissolution of stockholders whose preferential rights on dissolution are superior to those receiving the dividends. However, even if TEB Bancorp, Inc.’s assets are less than the amount necessary to satisfy the requirement set forth above, TEB Bancorp, Inc. may pay dividends from: its net earnings for the fiscal year in which the distribution is made; its net earnings for the preceding fiscal year; or the sum of its net earnings for the preceding eight fiscal quarters. The payment of dividends by TEB Bancorp, Inc. is also subject to limitations that are imposed by applicable regulation. The holders of common stock of TEB Bancorp, Inc. will be entitled to receive and share equally in dividends as may be declared by our board of directors out of funds legally available therefor. If TEB Bancorp, Inc. issues shares of preferred stock, the holders thereof may have a priority over the holders of the common stock with respect to dividends.
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If TEB Bancorp, Inc. pays dividends to its stockholders, it would likely pay dividends to TEB MHC, unless TEB MHC is permitted by the Federal Reserve Board to waive the receipt of dividends. The Federal Reserve Board’s current policy restricts the ability of mutual holding companies organized as bank holding companies to waive dividends declared by their subsidiaries. Accordingly, because dividends would be required to be paid to TEB MHC along with all other stockholders, the amount of dividends available for all other stockholders would be less than if TEB MHC were permitted to waive the receipt of dividends.
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Voting Rights. The holders of common stock of TEB Bancorp, Inc. have exclusive voting rights in TEB Bancorp, Inc. They elect TEB Bancorp, Inc.’s board of directors and act on other matters as are required to be presented to them under Maryland law or as are otherwise presented to them by the board of directors. Generally, each holder of common stock is entitled to one vote per share and does not have any right to cumulate votes in the election of directors. Any person who beneficially owns more than 10% of the then-outstanding shares of TEB Bancorp, Inc.’s common stock, however, is not entitled or permitted to vote any shares of common stock held in excess of the 10% limit. If TEB Bancorp, Inc. issues shares of preferred stock, holders of the preferred stock may also possess voting rights. Certain matters require the approval of 80% of our outstanding common stock.
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Liquidation. In the event of any liquidation, dissolution or winding up of The Equitable Bank, TEB Bancorp, Inc., as the holder of 100% of The Equitable Bank’s capital stock, would be entitled to receive all assets of The Equitable Bank available for distribution, after payment or provision for payment of all debts and liabilities of The Equitable Bank, including all deposit accounts and accrued interest thereon. In the event of liquidation, dissolution or winding up of TEB Bancorp, Inc., the holders of its common stock would be entitled to receive, after payment or provision for payment of all its debts and liabilities, all of the assets of TEB Bancorp, Inc. available for distribution. If preferred stock is issued, the holders thereof may have a priority over the holders of the common stock in the event of liquidation or dissolution.
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Preemptive Rights. Holders of the common stock of TEB Bancorp, Inc. are not entitled to preemptive rights with respect to any shares that may be issued. The common stock is not subject to redemption.
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Preferred Stock
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Preferred stock may be issued with such preferences and designations as our board of directors may from time to time determine. Our board of directors can, without stockholder approval, issue preferred stock with voting, dividend, liquidation and conversion rights which could dilute the voting strength of the holders of the common stock and may assist management in impeding an unfriendly takeover or attempted change in control. TEB Bancorp, Inc. has no present plans to issue preferred stock.
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Mutual Holding Company Structure
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TEB MHC owns a majority of the outstanding common stock of TEB Bancorp, Inc. and, through its board of directors, is able to exercise voting control over virtually all matters put to a vote of stockholders. For example, TEB MHC may exercise its voting control to prevent a sale or merger transaction or to defeat a stockholder nominee for election to the board of directors of TEB Bancorp, Inc. It is not be possible for another entity to acquire TEB Bancorp, Inc. without the consent of TEB MHC. TEB MHC, as long as it remains in the mutual form of organization, will control a majority of the voting stock of TEB Bancorp, Inc.
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Federal Law and Regulations
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Under the Change in Bank Control Act, no person, or group of persons acting in concert, may acquire control of a bank holding company unless the Federal Reserve Board has been given 60 days’ prior written notice and not disapproved the proposed acquisition. The Federal Reserve Board considers several factors in evaluating a notice, including the financial and managerial resources of the acquirer and competitive effects. Control, as defined under the applicable regulations, means the power, directly or indirectly, to direct the management or policies of the company or to vote 25% or more of any class of voting securities of the company. Acquisition of more than 10% of any class of a bank holding company’s voting securities constitutes a rebuttable presumption of control under certain circumstances, including where, as is the case with TEB Bancorp, Inc., the issuer has registered securities under Section 12 of the Securities Exchange Act of 1934.
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In addition, federal regulations provide that no company may acquire control (as defined in the Bank Holding Company Act) of a bank holding company without the prior approval of the Federal Reserve Board. Any company that acquires such control becomes a “bank holding company” subject to registration, examination and regulation by the Federal Reserve Board.
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Federal Reserve Board regulations generally prohibit any person from acquiring or making an offer to acquire beneficial ownership of more than 10% of the stock of TEB Bancorp, Inc. or The Equitable Bank without the Federal Reserve Board’s prior approval within a period of three years following TEB Bancorp’s completion of its offering.
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Maryland Law and Articles of Incorporation and Bylaws of TEB Bancorp, Inc.
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Maryland law, as well as TEB Bancorp, Inc.’s articles of incorporation and bylaws, contain a number of provisions relating to corporate governance and rights of stockholders that may discourage future takeover attempts. As a result, stockholders who might desire to participate in such transactions may not have an opportunity to do so. In addition, these provisions will also render the removal of the board of directors or management of TEB Bancorp, Inc. more difficult.
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Directors. The board of directors are divided into three classes. The members of each class are elected for a term of three years and only one class of directors will be elected annually. Thus, it would take at least two annual elections to replace a majority of the board of directors. The bylaws establish qualifications for board members, including restrictions on affiliations with competitors of The Equitable Bank and restrictions based upon prior legal or regulatory violations. Further, the bylaws impose notice and information requirements in connection with the nomination by stockholders of candidates for election to the board of directors or the proposal by stockholders of business to be acted upon at an annual meeting of stockholders. Such notice and information requirements are applicable to all stockholder business proposals and nominations, and are in addition to any requirements under the federal securities laws.
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Restrictions on Calling Special Meetings. The bylaws provide that special meetings of stockholders can be called by the president, the chief executive officer, the chairman, by a majority of the whole board of directors or upon the written request of stockholders entitled to cast at least a majority of all votes entitled to vote at the meeting. The board of directors has the sole power to fix (i) the record date for determining stockholders entitled to request a special meeting of stockholders and the record date for determining stockholders entitled to notice of and to vote at the special meeting and (ii) the date, time and place of the special meeting and the means of remote communication, if any, by which stockholders and proxy holders may be considered present in person and may vote at the special meeting.
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Prohibition of Cumulative Voting. The articles of incorporation prohibit cumulative voting for the election of directors.
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Limitation of Voting Rights. The articles of incorporation provide that in no event will any person who beneficially owns more than 10% of the then-outstanding shares of common stock, be entitled or permitted to vote any of the shares of common stock held in excess of the 10% limit. This provision has been included in the articles of incorporation in reliance on Section 2-507(a) of the Maryland General Corporation Law, which entitles stockholders to one vote for each share of stock unless the articles of incorporation provide for a greater or lesser number of votes per share or limit or deny voting rights.
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Restrictions on Removing Directors from Office. The articles of incorporation provide that directors may be removed only for cause, and only by the affirmative vote of the holders of at least two-thirds of the voting power of all of TEB Bancorp, Inc.’s then-outstanding common stock entitled to vote (after giving effect to the limitation on voting rights discussed above in “—Limitation of Voting Rights”).
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Forum Selection for Certain Stockholder Lawsuits. TEB Bancorp, Inc.’s articles of incorporation provide that, unless TEB Bancorp, Inc. consents in writing to the selection of an alternative forum, the sole and exclusive forum for (i) any derivative action or proceeding brought on behalf of TEB Bancorp, Inc., (ii) any action asserting a claim of breach of a fiduciary duty owed by any director, officer or other employee of TEB Bancorp, Inc. to TEB Bancorp, Inc. or TEB Bancorp, Inc.’s stockholders, (iii) any action asserting a claim arising pursuant to any provision of the Maryland General Corporation Law, or (iv) any action asserting a claim governed by the internal affairs doctrine shall be a state or federal court located within the state of Maryland, in all cases subject to the court’s having personal jurisdiction over the indispensable parties named as defendants.  
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Under the articles of incorporation, any person or entity purchasing or otherwise acquiring any interest in shares of capital stock of TEB Bancorp, Inc. shall be deemed to have notice of and consented to the exclusive forum provisions of the articles of incorporation.  The choice of forum provision may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors and officers or other employees, which may discourage such lawsuits against us and our directors, officers and other employees.  
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Because this provision permits claims to be brought in federal courts located in the state of Maryland, this provision would apply to a claim made under the U.S. federal securities laws where there is exclusive federal jurisdiction for such a claim.  However, a court may find the choice of forum provision contained in our articles of incorporation to be inapplicable or unenforceable in an action.  As a result, we may incur additional costs associated with resolving such action in other jurisdictions, which could adversely affect our business and financial condition.
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Authorized but Unissued Shares. After the reorganization, TEB Bancorp, Inc. will have authorized but unissued shares of common and preferred stock. See “Description of Capital Stock of TEB Bancorp, Inc.” The articles of incorporation authorize 5,000,000 shares of serial preferred stock. TEB Bancorp, Inc. is authorized to issue preferred stock from time to time in one or more series subject to applicable provisions of law, and the board of directors is authorized to fix the preferences, conversion and other rights, voting powers, restrictions, limitations as to dividends, qualifications and terms and conditions of redemption of the shares of each such series. In the event of a proposed merger, tender offer or other attempt to gain control of TEB Bancorp, Inc. that the board of directors does not approve, it may be possible for the board of directors to authorize the issuance of a series of preferred stock with rights and preferences that would impede the completion of the transaction. An effect of the possible issuance of preferred stock therefore may be to deter a future attempt to gain control of TEB Bancorp, Inc. The board of directors has no present plan or understanding to issue any preferred stock.
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Amendments to Articles of Incorporation and Bylaws. Amendments to the articles of incorporation must be approved by the board of directors and by the affirmative vote of at least two-thirds of the outstanding shares of common stock, or by the affirmative vote of a majority of the outstanding shares of common stock if at least two-thirds of the members of the whole board of directors approves such amendment; provided, however, that approval by at least 80% of the outstanding voting stock is generally required to amend the following provisions:
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(i)           the limitation on voting rights of persons who directly or indirectly beneficially own more than 10% of the outstanding shares of common stock;
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(ii)          the division of the board of directors into three staggered classes;
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(iii)         the ability of the board of directors to fill vacancies on the board;
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(iv)         the requirement that directors may only be removed for cause and by the affirmative vote of at least two-thirds of the votes eligible to be cast by stockholders;
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(v)          the ability of the board of directors to amend and repeal the bylaws;
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(vi)         the ability of the board of directors to evaluate a variety of factors in evaluating offers to purchase or otherwise acquire TEB Bancorp, Inc.;
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(vii)        the authority of the board of directors to provide for the issuance of preferred stock;
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(viii)       the validity and effectiveness of any action lawfully authorized by the affirmative vote of the holders of a majority of the total number of outstanding shares of common stock;
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(ix)         the number of stockholders constituting a quorum or required for stockholder consent;
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(x)          the indemnification of current and former directors and officers, as well as employees and other agents, by TEB Bancorp, Inc.;
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(xi)         the limitation of liability of officers and directors to TEB Bancorp, Inc. for money damages;
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(xii)        the inability of stockholders to cumulate their votes in the election of directors;
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(xiii)       the advance notice requirements for stockholder proposals and nominations;
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(xiv)       The requirement that the forum for certain actions or disputes will be a state or federal court located within the State of Maryland; and
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(xv)        the provision of the articles of incorporation requiring approval of at least 80% of the outstanding voting stock to amend the provisions of the articles of incorporation provided in (i) through (xiv) of this list.
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The articles of incorporation also provide that the bylaws may be amended by the affirmative vote of a majority of TEB Bancorp, Inc.’s directors or by the affirmative vote of at least 80% of the total votes eligible to be cast by stockholders at a duly constituted meeting of stockholders. Any amendment of this super-majority requirement for amendment of the bylaws would also require the approval of 80% of the total votes eligible to be cast.
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The provisions requiring the affirmative vote of 80% of the total eligible votes eligible to be cast for certain stockholder actions have been included in the articles of incorporation of TEB Bancorp, Inc. in reliance on Section 2-104(b)(4) of the Maryland General Corporation Law. Section 2-104(b)(4) permits the articles of incorporation to require a greater proportion of votes than the proportion that would otherwise be required for stockholder action under the Maryland General Corporation Law.
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Business Combinations with Interested Stockholders. Under Maryland law, “business combinations” between TEB Bancorp, Inc. and an interested stockholder or an affiliate of an interested stockholder are prohibited for five years after the most recent date on which the interested stockholder becomes an interested stockholder. These business combinations include a merger, consolidation, statutory share exchange or, in circumstances specified in the statute, certain transfers of assets, certain stock issuances and transfers, liquidation plans and reclassifications involving interested stockholders and their affiliates or issuance or reclassification of equity securities. Maryland law defines an interested stockholder as: (i) any person who beneficially owns 10% or more of the voting power of TEB Bancorp, Inc.’s voting stock after the date on which TEB Bancorp, Inc. had 100 or more beneficial owners of its stock; or (ii) an affiliate or associate of TEB Bancorp, Inc. at any time after the date on which TEB Bancorp, Inc. had 100 or more beneficial owners of its stock who, within the two-year period prior to the date in question, was the beneficial owner of 10% or more of the voting power of the then-outstanding voting stock of TEB Bancorp, Inc. A person is not an interested stockholder under the statute if the board of directors approved in advance the transaction by which the person otherwise would have become an interested stockholder. However, in approving a transaction, the board of directors may provide that its approval is subject to compliance, at or after the time of approval, with any terms and conditions determined by the board.
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After the five-year prohibition, any business combination between TEB Bancorp, Inc. and an interested stockholder generally must be recommended by the board of directors of TEB Bancorp, Inc. and approved by the affirmative vote of at least: (i) 80% of the votes entitled to be cast by holders of outstanding shares of voting stock of TEB Bancorp, Inc., and (ii) two-thirds of the votes entitled to be cast by holders of voting stock of TEB Bancorp, Inc. other than shares held by the interested stockholder with whom or with whose affiliate the business combination is to be effected or held by an affiliate or associate of the interested stockholder. These super-majority vote requirements do not apply if TEB Bancorp, Inc.’s common stockholders receive a minimum price, as defined under Maryland law, for their shares in the form of cash or other consideration in the same form as previously paid by the interested stockholder for its shares.
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Mergers, Consolidations and Sales of Assets. As a result of an election made in TEB Bancorp, Inc.’s articles of incorporation, a merger or consolidation of TEB Bancorp, Inc. requires approval of a majority of all votes entitled to be cast by stockholders. However, no approval by stockholders is required for a merger if:
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·             the plan of merger does not make an amendment to the articles of incorporation that would be required to be approved by the stockholders;
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·             each stockholder of the surviving corporation whose shares were outstanding immediately before the effective date of the merger will hold the same number of shares, with identical designations, preferences, limitations, and rights, immediately after; and
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·             the number of shares of any class or series of stock outstanding immediately after the effective time of the merger will not increase by more than 20% the total number of voting shares outstanding immediately before the merger.
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In addition, under certain circumstances the approval of the stockholders shall not be required to authorize a merger with or into a 90% owned subsidiary of TEB Bancorp, Inc.
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Under Maryland law, a sale of all or substantially all of TEB Bancorp, Inc.’s assets other than in the ordinary course of business, or a voluntary dissolution of TEB Bancorp, Inc., requires the approval of its board of directors and the affirmative vote of two-thirds of the votes of stockholders entitled to be cast on the matter.
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Evaluation of Offers. The articles of incorporation provide that TEB Bancorp, Inc.’s board of directors, when evaluating a transaction that would or may involve a change in control of TEB Bancorp, Inc. (whether by purchases of its securities, merger, consolidation, share exchange, dissolution, liquidation, sale of all or substantially all of its assets, proxy solicitation or otherwise), may, in connection with the exercise of its business judgment in determining what is in the best interests of TEB Bancorp, Inc. and its stockholders and in making any recommendation to the stockholders, give due consideration to all relevant factors, including, but not limited to:
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·             the economic effect, both immediate and long-term, upon TEB Bancorp, Inc.’s stockholders, including stockholders, if any, who do not participate in the transaction;
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·             the social and economic effect on the present and future employees, creditors and customers of, and others dealing with, TEB Bancorp, Inc. and its subsidiaries and on the communities in which TEB Bancorp, Inc. and its subsidiaries operate or are located;
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·             whether the proposal is acceptable based on the historical, current or projected future operating results or financial condition of TEB Bancorp, Inc.;
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·             whether a more favorable price could be obtained for TEB Bancorp, Inc.’s stock or other securities in the future;
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·             the reputation and business practices of the other entity to be involved in the transaction and its management and affiliates as they would affect the employees of TEB Bancorp, Inc. and its subsidiaries;
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·             the future value of the stock or any other securities of TEB Bancorp, Inc. or the other entity to be involved in the proposed transaction;
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·             any antitrust or other legal and regulatory issues that are raised by the proposal;
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·             the business and historical, current or expected future financial condition or operating results of the other entity to be involved in the transaction, including, but not limited to, debt service and other existing financial obligations, financial obligations to be incurred in connection with the proposed transaction, and other likely financial obligations of the other entity to be involved in the proposed transaction; and
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·             the ability of TEB Bancorp, Inc. to fulfill its objectives as a financial institution holding company and the ability of its subsidiary financial institution(s) to fulfill the objectives of a federally insured financial institution under applicable statutes and regulations.
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If the board of directors determines that any proposed transaction should be rejected, it may take any lawful action to defeat such transaction.
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Purpose and Anti-Takeover Effects of TEB Bancorp, Inc.’s Articles of Incorporation and Bylaws. Our board of directors believes that the provisions described above are prudent and will reduce our vulnerability to takeover attempts and certain other transactions that have not been negotiated with and approved by our board of directors. These provisions also will assist us in the orderly deployment of the offering proceeds into productive assets during the initial period after the stock offering. We believe these provisions are in the best interests of TEB Bancorp, Inc. and its stockholders. Our board of directors believes that it will be in the best position to determine the true value of TEB Bancorp, Inc. and to negotiate more effectively for what may be in the best interests of all our stockholders. Accordingly, our board of directors believes that it is in the best interests of TEB Bancorp, Inc. and all of our stockholders to encourage potential acquirers to negotiate directly with the board of directors and that these provisions will encourage such negotiations and discourage hostile takeover attempts. It is also the view of our board of directors that these provisions should not discourage persons from proposing a merger or other transaction at a price reflective of the true value of TEB Bancorp, Inc. and that is in the best interests of all our stockholders.
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Takeover attempts that have not been negotiated with and approved by our board of directors present the risk of a takeover on terms that may be less favorable than might otherwise be available. A transaction that is negotiated and approved by our board of directors, on the other hand, can be carefully planned and undertaken at an opportune time in order to obtain maximum value for our stockholders, with due consideration given to matters such as the management and business of the acquiring corporation.
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Although a tender offer or other takeover attempt may be made at a price substantially above the current market price, such offers are sometimes made for less than all of the outstanding shares of a target company. As a result, stockholders may be presented with the alternative of partially liquidating their investment at a time that may be disadvantageous, or retaining their investment in an enterprise that is under different management and whose objectives may not be similar to those of the remaining stockholders.
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Despite our belief as to the benefits to stockholders of these provisions of TEB Bancorp, Inc.’s articles of incorporation and bylaws, these provisions also may have the effect of discouraging a future takeover attempt that would not be approved by our board of directors, but pursuant to which stockholders may receive a substantial premium for their shares over then current market prices. As a result, stockholders who might desire to participate in such a transaction may not have any opportunity to do so. Such provisions will also make it more difficult to remove our board of directors and management. We believe, however, that the potential benefits outweigh the possible disadvantages.
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Benefit Plans
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In addition to the provisions of TEB Bancorp, Inc.’s articles of incorporation and bylaws described above, benefit plans of TEB Bancorp, Inc. and The Equitable Bank that may authorize the issuance of equity to its board of directors, officers and employees adopted in connection with or following the offering contain or may contain provisions which also may discourage hostile takeover attempts which the board of directors of The Equitable Bank might conclude are not in the best interests of TEB Bancorp, Inc. and The Equitable Bank or TEB Bancorp, Inc.’s stockholders.Document

EXHIBIT 10.1

FOURTH AMENDMENT TO LOAN DOCUMENTS

THIS FOURTH AMENDMENT TO LOAN DOCUMENTS (this “Amendment”), dated as of September 22, 2021 is by and among PRESENTATION TECHNOLOGIES, LLC, a Delaware limited liability company, formerly known as Presentation Technologies, Inc., a Texas corporation (singularly and collectively, if more than one party, “Borrower”), J & S AUDIO VISUAL COMMUNICATIONS, LLC, a Texas limited liability company (“J&S”), J&S AUDIO VISUAL DOMINICAN REPUBLIC, LP, a Texas limited partnership (“JSDR”), J&S DR GP, LLC, a Delaware limited liability company (“JSGP”), and PT DR HOLDINGS, LLC, a Delaware limited liability company (“PTDR”, and together with J&S, JSDR, and JSGP, collectively, “Guarantors”, and each, individually, a “Guarantor”), PT HOLDCO, LLC, a Delaware limited liability company (“Pledgor”), and COMERICA BANK (“Bank”).

RECITALS:

A.Bank and Borrower have entered into that certain Credit Agreement dated as of November 1, 2017 (as the same has been or may be amended, restated or otherwise modified from time to time, the “Credit Agreement”).

B.In connection with the Credit Agreement, Borrower, Guarantors executed and delivered that certain Advance Formula Agreement dated as of November 1, 2017 to Bank (as the same has been amended, restate or otherwise modified from time to time, the “Advance Formula Agreement”).

C.To secure the Indebtedness under the Credit Agreement, (a) each Guarantor has executed and delivered to Bank that certain Guaranty dated as of November 1, 2017 (as the same has been or may be amended, restated or otherwise modified from time to time, the “Guaranty”), and (b) Pledgor has executed and delivered to Bank that certain Pledge and Security Agreement dated as of November 1, 2017 (as the same has been or may be amended, restated or otherwise modified from time to time, the “Pledge Agreement”).

E.Borrower and Guarantors have requested Bank to agree to amend the Loan Documents as hereinafter provided.

NOW, THEREFORE, in consideration of the premises herein contained and other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows:

ARTICLE I

Definitions

Section 1.1    Definitions.    Capitalized terms used in this Amendment, to the extent not otherwise defined herein, shall have the same meanings as in the Credit Agreement, as amended hereby.

ARTICLE II

Amendments to Loan Documents

Section 2.1   Amendment to Section 4(n) of the Credit Agreement.   Effective as of the date hereof, Section 4(n) of the Credit Agreement is hereby amended and restated to read in its entirety as follows:

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(n) Capital Expenditures. Without Bank’s prior written consent (which consent shall not be unreasonably withheld, denied, conditioned or delayed), make or incur consolidated non-financed Capital Expenditures in excess of One Million Two Hundred Fifty Thousand and No/100 Dollars ($1,250,000.00), in aggregate during any consecutive four fiscal quarter period of Borrower (the “CapEx Threshold”), tested quarterly; provided, however, that Capital Expenditures may exceed the CapEx Threshold if (i) such payments are funded solely as a result of an investment by Ashford Hospitality Services, LLC, or any affiliate of Ashford Inc. and (ii) the assets purchased as a result of such Capital Expenditures are owned by Borrower and are Collateral under the Loan Documents.

Section 2.2    Amendment to Section 4(s) of the Credit Agreement. Effective as of the date hereof, Section 4(s) of the Credit Agreement is amended and restated to read in its entirety as follows:

(s)Operating Reserve Account.

(i)Beginning on the Third Amendment Effective Date, Borrower shall establish and maintain an operating reserve account (the “Operating Reserve Account”) with Bank with an initial amount of at least $3,000,000 in the aggregate in cash or deposited therein. Except as otherwise provided in this clause (s), Bank shall have exclusive access and control of the Operating Reserve Account. The proceeds of the Operating Reserve Account, as hereby authorized by Borrower, shall be applied to scheduled interest payments when due and payable on the Revolving Credit Note and the Term Note to Bank as well as projected operating losses of the Loan Parties. Within 30 days after the end of each fiscal quarter, in the event such amounts in the Operating Reserve Account are insufficient to pay in full the projected interest expense and operating costs for the forecasted period, as reflected in the projections most recently delivered under Section 4(a)(xi), Borrower shall deposit into such account additional funds in an amount equal to such deficiency. Provided that (i) no Default or Event of Default has occurred and is continuing or would occur as a result of such transfer and (ii) Borrower has timely delivered the projections as required under Section 4(a)(xi), in the event Borrower forecasts an Operating Loss for the calendar month then commencing, Bank shall transfer funds within the first three Business Days of such calendar month, in an amount not to exceed the Operating Loss for such calendar month, from the Operating Reserve Account to the primary deposit account of Borrower held with Bank to be used in the ordinary course of business of Borrower so long as after giving effect to such transfer, the amounts in the Operating Reserve Account exceed the projected amounts needed to pay in full the projected interest expense and operating costs for the forecasted period as reflected in such projections. Any additional requests by Borrower for disbursement of funds held in the Operating Reserve Account may be granted in the sole discretion of Bank, subject to such terms and conditions as Bank may require in its sole discretion. Borrower shall grant to Bank a continuing security interest in the Operating Reserve Account. The funds in the Operating Reserve Account will be released to Borrower upon delivery of evidence from Borrower to Bank, in form and substance reasonably satisfactory to Bank, that (i) Borrower maintained a Fixed Charge Coverage Ratio of no less than 1.20 to 1.0 for two prior consecutive fiscal quarters and (ii) the average Availability of the Borrower was at least $1,000,000 throughout the three month period most recently ended (collectively, the “Operating Reserve Account Release Conditions”).
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(ii)Notwithstanding the forgoing, in the event that (A) Borrower provides to Bank projections as required under Section 4(a)(xi) that do not project an Operating Loss over the forecasted period, and (B) no Default or Event of Default has occurred, then the Bank in its sole discretion may modify the requirements above (with exception of the Operating Reserve Account Release Conditions) such that Borrower shall instead maintain a minimum funded balance equal to $1,000,000 (or such other amount determined by Bank in its sole discretion and agreed to by Borrower in writing, provided such amount shall never exceed the amount required on deposit by the preceding paragraph (i) of this clause (s)) (such minimum balance referred to as the “Base Funded Amount”) in the Operating Reserve Account, and Bank would no longer make any monthly transfers from the Operating Reserve Account. Furthermore, Borrower would no longer be required to make any further deposits into the Operating Reserve Account so long as the balance thereof is at least equal to the Base Funded Amount at all times. Borrower acknowledges and agrees that if at any time Borrower’s projections indicate an Operating Loss, Bank is under no obligation to agree or continue to permit the modified requirements described in this paragraph, and Bank retains at all times the ability to require Borrower to either increase the Base Funded Amount or revert to the mechanism detailed in the first paragraph of this clause (s). For the avoidance of doubt, (i) under no circumstance shall the Bank modify the Operating Reserve Account Release Conditions set forth in the preceding paragraph (i) of this clause (s) without Borrower’s written consent and (ii) once the Operating Reserve Account Release Conditions are met, the funds in such account shall be immediately released to Borrower and the obligations of Borrower under this clause (s) shall terminate.

ARTICLE III

No Waiver

Section 3.1        No Waiver.   Nothing contained herein shall be construed as a consent to or waiver of any Default or Event of Default, which may now exist or hereafter occur or any violation of any term, covenant or provision of the Credit Agreement or any other Loan Document. All rights and remedies of the Bank are hereby expressly reserved with respect to any such Default or Event of Default. Nothing contained herein shall affect or diminish the right of the Bank to require strict performance by each Loan Party of each provision of any Loan Document to which such Person is a party, except as expressly provided herein. All terms and provisions and all rights and remedies of the Bank under the Loan Documents shall continue in full force and effect and are hereby confirmed and ratified in all respects.

ARTICLE IV

Ratifications

Section 4.1 Ratifications. The terms and provisions set forth in this Amendment shall modify and supersede all inconsistent terms and provisions set forth in the Credit Agreement and the other Loan Documents, and except as expressly modified and superseded by this Amendment, the terms and provisions of the Credit Agreement and the other Loan Documents are hereby ratified and confirmed and shall continue in full force and effect. Each of Borrower, Guarantors, Pledgor and Bank agrees and acknowledges that the Credit Agreement and the other Loan Documents to which such Person is a party, as amended hereby, shall continue to be legal, valid, binding and enforceable in accordance with their respective terms. The Liens granted in favor of Bank are hereby ratified and confirmed as continuing to
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secure payment of the Indebtedness. Each Guarantor hereby consents and agrees to this Amendment and agrees the Guaranty shall remain in full force and effect and shall continue to (a) guarantee the Indebtedness (as defined in the Guaranty) and the other amounts and obligations as provided in the Guaranty, and (b) be the legal, valid and binding obligation of such Guarantor and enforceable against such Guarantor in accordance with its terms. Pledgor hereby consents and agrees to this Amendment and agrees the Pledge Agreement shall remain in full force and effect and shall continue to be the legal, valid and binding obligation of Pledgor and enforceable against Pledgor in accordance with its terms. Nothing herein shall in any manner diminish, impair or extinguish any of the obligations of any Loan Party evidenced by the Credit Agreement or any of the other Loan Documents to which such Person is a party or the Liens granted in favor of Bank.

Section 4.2     Representations and Warranties.   Each of Borrower, Pledgor and Guarantors hereby represents and warrants to Bank that the representations and warranties contained in the Credit Agreement and the other Loan Documents to which such Person is a party, all as amended hereby, and any other documents executed in connection therewith or herewith are true and correct in all material respects on and as of the date hereof as though made on and as of the date hereof, except to the extent stated to relate to a specific earlier date, in which case such representation and warranty is true and correct as of such earlier date.

ARTICLE V

Conditions Precedent

Section 5.1    Conditions Precedent. The effectiveness of this Amendment is subject to the satisfaction of the following conditions precedent:

(a)Bank shall have received, all in form and substance satisfactory to Bank this Amendment properly executed by Borrower, Pledgor, each Guarantor and Bank.

(b)The Bank shall have received payment of all out-of-pocket fees and expenses (including reasonable attorneys’ fees and expenses) incurred by the Bank in connection with the preparation, negotiation and execution of this Amendment and any other Loan Document as well as the required payment pursuant to Section 2(a) of the Credit Agreement.

(c)The representations and warranties contained herein and in all other Loan Documents, as amended hereby, shall be true and correct in all material respects as of the date hereof as if made on the date hereof, except to the extent stated to relate to a specific earlier date, in which case such representation and warranty is true and correct as of such earlier date.

(d)No Default or Event of Default shall have occurred and be continuing.

(e)Bank shall have received such other documents, instruments and agreements as Bank may reasonably require.

ARTICLE VI

Miscellaneous

Section 6.1   Survival of Representations and Warranties. All representations and warranties made in this Amendment or any other document executed in connection herewith shall survive the execution and delivery of this Amendment, and no investigation by Bank or any closing shall affect the representations and warranties or the right of Bank to rely upon them.
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Section 6.2       Reference to Agreement.   Each of the Credit Agreement, the Loan Documents and any and all other agreements, documents, or instruments now or hereafter executed and delivered pursuant to the terms hereof or pursuant to the terms of the Credit Agreement or the other Loan Documents, as amended hereby, are hereby amended so that any reference in such documents to the Loan Documents shall mean a reference to the Loan Documents as amended hereby.

Section 6.3     Expenses of Bank. As provided in the Credit Agreement, Borrower agrees to pay on demand all costs and expenses incurred by Bank in connection with the enforcement or preservation of any rights under the Credit Agreement or any other document executed in connection therewith, including without limitation the reasonable fees and legal expenses of Bank’s legal counsel.

Section 6.4 Severability. Any provision of this Amendment held by a court of competent jurisdiction to be invalid or unenforceable shall not impair or invalidate the remainder of this Amendment and the effect thereof shall be confined to the provision so held to be invalid or unenforceable.

Section 6.5 Applicable Law. THIS AMENDMENT AND ALL OTHER DOCUMENTS EXECUTED PURSUANT HERETO SHALL BE DEEMED TO HAVE BEEN MADE AND TO BE PERFORMABLE IN DALLAS, TEXAS AND SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS.

Section 6.6 Successors and Assigns. This Amendment is binding upon and shall inure to the benefit of Bank, Borrower, Pledgor and Guarantors, and their respective successors and assigns, except none of Borrower or any Guarantor may assign or transfer any of its rights or obligations hereunder without the prior written consent of Bank.

Section 6.7     Counterparts. This Amendment may be executed in any number of counterparts and by different parties on separate counterparts, each of which shall be an original and all of which taken together shall constitute one and the same agreement. The signature of a party to any counterpart shall be sufficient to legally bind such party. Bank may remove the signature pages from one or more counterparts and attach them to any other counterpart for the purpose of having a single document containing the signatures of all parties. Delivery of an executed counterpart of a signature page to this Amendment by facsimile, emailed portable document format (“pdf”), or tagged image file format (“tiff”) or any other electronic means that reproduces an image of the actual executed signature page shall be effective as delivery of an original executed counterpart of a signature page to this Amendment. Any party sending an executed counterpart of a signature page to this Amendment by facsimile, pdf, tiff or any other electronic means shall also send the original thereof to Bank within five (5) days thereafter, but failure to do so shall not affect the validity, enforceability, or binding effect of this Amendment.

Section 6.8    Headings.   The headings, captions, and arrangements used in this Amendment are for convenience only and shall not affect the interpretation of this Amendment.

Section 6.9 Release. EACH OF BORROWER, PLEDGOR AND GUARANTORS HEREBY VOLUNTARILY AND KNOWINGLY RELEASES AND FOREVER DISCHARGES BANK, ITS PREDECESSORS, AGENTS, EMPLOYEES, SUCCESSORS AND ASSIGNS FROM ALL CLAIMS, DEMANDS, ACTIONS, CAUSES OF ACTION, DAMAGES, COSTS, EXPENSES, AND LIABILITIES WHATSOEVER, KNOWN TO BORROWER OR GUARANTORS, ANTICIPATED OR UNANTICIPATED, SUSPECTED OR UNSUSPECTED, FIXED, CONTINGENT, OR CONDITIONAL, AT LAW OR IN EQUITY, ORIGINATING IN WHOLE OR IN PART ON OR BEFORE THE DATE THIS AMENDMENT IS EXECUTED, WHICH BORROWER, PLEDGOR OR SUCH GUARANTOR MAY NOW HAVE AGAINST BANK, ITS PREDECESSORS, AGENTS, EMPLOYEES, SUCCESSORS AND ASSIGNS, IF ANY, AND IRRESPECTIVE OF WHETHER ANY SUCH CLAIMS ARISE OUT OF
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CONTRACT, TORT, VIOLATION OF LAW OR REGULATIONS, OR OTHERWISE, AND ARISING FROM ANY “ADVANCES”, INCLUDING, WITHOUT LIMITATION, ANY CONTRACTING FOR, CHARGING, TAKING, RESERVING, COLLECTING OR RECEIVING INTEREST IN EXCESS OF THE HIGHEST LAWFUL RATE APPLICABLE, THE EXERCISE OF ANY RIGHTS AND REMEDIES UNDER THE CREDIT AGREEMENT, OR THE OTHER LOAN DOCUMENTS, AND NEGOTIATION FOR AND EXECUTION OF THIS WAIVER.

Section 6.10 ENTIRE AGREEMENT. THE CREDIT AGREEMENT, THIS AMENDMENT AND ALL OTHER INSTRUMENTS, DOCUMENTS AND AGREEMENTS EXECUTED AND DELIVERED IN CONNECTION WITH THE CREDIT AGREEMENT OR THIS AMENDMENT EMBODY THE FINAL, ENTIRE AGREEMENT AMONG THE PARTIES HERETO AND SUPERSEDE ANY AND ALL PRIOR COMMITMENTS, AGREEMENTS, REPRESENTATIONS AND UNDERSTANDINGS, WHETHER WRITTEN OR ORAL, RELATING TO THIS AMENDMENT, AND MAY NOT BE CONTRADICTED OR VARIED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OR DISCUSSIONS OF THE PARTIES HERETO. THERE ARE NO ORAL AGREEMENTS AMONG THE PARTIES HERETO.

[Remainder Of Page Intentionally Left Blank.  Signature Pages Follow.]
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Executed as of the date first written above.

BORROWER:

PRESENTATION TECHNOLOGIES, LLC

By:    /s/ CHUCK BAUMAN    
Chuck Bauman
Chief Executive Officer
Signature Page

GUARANTORS:

PT DR HOLDINGS, LLC

By:    /s/ CHUCK BAUMAN    
Chuck Bauman
Chief Executive Officer

J & S AUDIO VISUAL COMMUNICATIONS, LLC

By:    /s/ CHUCK BAUMAN    
Chuck Bauman
Chief Executive Officer

J&S DR GP, LLC

By:    Presentation Technologies, LLC,
its Manager

By:    /s/ CHUCK BAUMAN    
Chuck Bauman
Chief Executive Officer

J&S AUDIO VISUAL DOMINICAN REPUBLIC, LP By:    J&S DR GP, LLC,
its General Partner

By:    Presentation Technologies, LLC,
its Manager

By:    /s/ CHUCK BAUMAN    
Chuck Bauman
Chief Executive Officer
Signature Page

PLEDGOR:
PT HOLDCO, LLC

By:    Ashford Inc.,
its Manager

By:    /s/ ALEX ROSE    
Alex Rose
EVP, General Counsel & Secretary
Signature Page

BANK:

COMERICA BANK

By:    /s/ CHRIS D. REED    
Chris D. Reed
Vice President
Signature Page

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