BAS Case Study - March 2023



• Maintain sufficient Tier 1 Capital (to average assets) and Total Capital (to risk-weighted assets) to meet the definition of well-capitalized under prompt corrective action provisions. The current Tier 1 Capital ratio is 8.1 7 % and the Total Capital Ratio is 14.4 2 % as of 12/31/18. This does not reflect the Call Report amend

• Provide liquidity to shareholders and give the Company the ability to effectively manage large blocks of share sales.

• Advance a platform that encourages a shareholder base that can invest in the local community bank. Stock Valuation CAMELS Consulting Group LLC conducted a stock valuation as of 06/30/18 under the direction of the Board of Directors. • The independent stock valuation provided a range of $26.60 to $32.00 per share based on the financial statements and performance of the Company, as well as recent trades.

• The stock price range of $26.60 to $32.00 per share represents a price/book ratio of 118% to 141%.

• The offering price will be finalized immediately prior to the commencement of the stock offering. Based on discussion among the Board of Directors with input from CAMELS Consulting, the stock offering price will be $28.00.

Stock Offering

• The Board of Directors has determined that a stock offering by Sunny State Financial Network, Inc. is the best and most efficient course of action to accomplish the goals of this capital plan.

• The target of the stock offering is to raise $1.5 million in new capital.

• This capital plan provides for achieving a Tier 1 Capital ratio in excess of 9.00% during 2019, satisfying a provision of the MOU dated 06/21/18. See proforma capital calculations below.

• Stock offering details:

- At the advice of CAMELS Consulting, the stock offering prospectus will utilize the financial statement results as of 12/31/18. All stock offering materials will be amended to include

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