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As filed with the Securities and Exchange Commission on November 26, 2014.

Registration No. 333-200149July 8, 2019.

 

Registration No. 333-          

 

UNITED STATES


SECURITIES AND EXCHANGE COMMISSION

WASHINGTON,Washington, D.C. 20549

Amendment No. 1

to

FORM S-4

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

 


 

FORM S-4

REGISTRATION STATEMENT

Under
The Securities Act of 1933


WINTRUST FINANCIAL CORPORATION

(Exact Namename of Registrant as Specifiedspecified in its Charter)charter)

 


 

Illinois

 

6022

Illinois6022

36-3873352

(State or Other Jurisdiction of

Incorporation or Organization)

(Primary Standard Industrial

(I.R.S. Employer

Incorporation or Organization)

Classification Code Number)

(I.R.S. Employer

Identification Number)

9700 W. Higgins Road, Suite 800

Rosemont, Illinois 60018

(847) 939-9000

(Address, including zip code, and telephone number, including area code, of Registrant’s principal executive offices)

Lisa J. Pattis

Kathleen M. Boege

Executive Vice President, General Counsel and Corporate Secretary

9700 W. Higgins Road, Suite 800

Rosemont, Illinois 60018

(847) 939-9000

(Name, address, including zip code, and telephone number, including area code, of agent for service)

 


 

Copies to:

 

Pran Jha

Dennis R. Wendte

Pran JhaJohn Knight

Sidley Austin LLP

Boardman & Clark LLP

One South Dearborn Street
Chicago, Illinois 60603
(312) 853-7000

One South Pinckney

Barack Ferrazzano Kirschbaum & Nagelberg LLP
200 W. Madison Street, Suite 410

3900
Chicago, Illinois 60603
Madison, Wisconsin 53703
60606
(312) 853-7000
(608) 257-9521984-3100

 


 

APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE OF THE SECURITIES TO THE PUBLIC: As soon as reasonably practicable after the Registration Statement becomes effective and after the conditions to the completion of the proposed transaction described in the proxy statement/prospectus have been satisfied or waived.

 


 

If the securities being registered on this Form are being offered in connection with the formation of a holding company and there is compliance with General Instruction G, check the following box. ¨o

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ¨o

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ¨o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company, or on emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company”, and “smaller reporting“emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):

 

Large accelerated filer

x

x

Accelerated filer

¨

Non-accelerated filer

o

¨  (Do not check if a smaller reporting company)

Smaller reporting company

¨

Emerging growth company

¨

o

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of the Securities Act. o


CALCULATION OF REGISTRATION FEE

 

 

 

 

 

 

 

 

 

 

Title of Each Class of
Securities to be Registered

 

Amount to be
Registered(1)

 

Proposed
Maximum
Offering Price
Per Unit(1)(2)

 

Proposed
Maximum
Aggregate
Offering Price(2)

 

Amount of
Registration
Fee(2)

 

Common Stock, no par value per share

 

405,023

 

N/A

 

$

8,360,151.69

 

$

1,013.25

 

 

 

 

 

 

 

 

 

 

 

(1)The number of shares to be registered represents the maximum number of shares of Wintrust Financial Corporation common stock estimated to be issuable in connection with the merger described in the proxy statement/prospectus, based upon (i) 449,229 outstanding shares of common stock, par value $0.01 per share, of STC Bancshares Corp. (“STC”) and (ii) up to 69,200 shares of STC common stock issuable upon exercise of outstanding options granted under the STC Bancshares Corp. 2005 Stock Incentive Plan and the STC Bancshares Corp. 2016 Equity Incentive Plan.

(2)Pursuant to Rules 457(f) and 457(h) under the Securities Act of 1933, as amended, and solely for the purpose of calculating the registration fee, the proposed maximum aggregate offering price is the difference between (a) the aggregate book value of the shares of STC common stock computed as of June 30, 2019 and (b) the aggregate amount of cash to be paid by Wintrust Financial Corporation for the outstanding shares of STC common stock, pursuant to the merger described in the proxy statement/prospectus.


The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until this registration statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.


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The information in this proxy statement/prospectus is not complete and may be changed. We may not offer or sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary proxy statement/prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.

PRELIMINARY COPY — SUBJECT TO COMPLETION, DATED NOVEMBER 26, 2014JULY 8, 2019

 

STC Bancshares Corp.

Wintrust Financial

Delavan Bancshares, Inc.

Wintrust Financial

Corporation

 


 

PROXY STATEMENT OF DELAVANSTC BANCSHARES INC.CORP.

 


 

PROSPECTUS OF WINTRUST FINANCIAL CORPORATION

 


 

Merger Proposal Your Vote Is Important

DEAR DELAVAN SHAREHOLDERS:STC SHAREHOLDERS:

You are cordially invited to attend a special meeting of shareholders of DelavanSTC Bancshares Inc.Corp. (“STC”), which will be held on      , 2015,2019, at      , local time, at      .

At the meeting, you will be asked to adopt the merger agreement as amended on November 19, 2014, and as it may be amended from time to time, between DelavanSTC and Wintrust Financial Corporation that provides for Wintrust’s acquisition of DelavanSTC through the merger of DelavanSTC with and into WintrustWTFC STCBC Merger Co.,Sub LLC, a wholly-owned subsidiary of Wintrust. DelavanSTC is the parent company of Community Bank CBD.STC Capital Bank. The aggregate merger consideration paid by Wintrust to DelavanSTC shareholders is expected to be $100 per share of outstanding STC common stock, or an aggregate of approximately $38,000,000,$44,922,900, based on 449,229 shares of STC common stock outstanding as of       , 2019, subject to an escrow holdback, possible upward or downward adjustment as described below.below, and fluctuations in the trading price of Wintrust common stock. Assuming that the reference price as described below is between $39.50at least $64.00 and $49.50,no greater than $76.00 and no deduction from the escrowed funds and no adjustment to the merger consideration, 50% of the aggregate merger consideration will be paid in shares of Wintrust common stock, no par value per share, and 50% will be paid in cash.

The exchange ratio used to determine the number of shares of Wintrust common stock that you will be entitled to receive for each share of DelavanSTC common stock, par value $1.00$0.01 per share, will be determined based on the average high and low saleof the volume-weighted average price of Wintrust common stock as reported under the heading “Bloomberg VWAP” on NASDAQ, which we refer to as the reference price,Bloomberg page for Wintrust, for each trading day during the 10five trading day period ending on the second trading day prior to completion of the merger, which we refer to as the reference price, subject to a minimum and maximum reference price equal to $39.50$64.00 and $49.50,$76.00, respectively.The merger consideration is subject to an escrow holdback and upward or downward adjustment as described in this proxy statement/prospectus, and the exchange ratio will not be determined until after the date of the special meeting. Therefore, at the time of the special meeting, you will not know the precise value of the merger consideration you may receive on the date the merger is completed.

Assuming no deduction from the escrowed funds and no adjustment to the merger consideration, and that the currently outstanding 373,989 shares of Delavan common stock remain unchanged at the closing, based on a reference price of $     , which is equal to the reference price if it were calculated as of      , 2014,2019, the latest practicable date prior to the date of this proxy statement/prospectus, the merger consideration that a DelavanSTC shareholder would be entitled to receive for each share of DelavanSTC common stock would be $      in cash and       shares of Wintrust common stock. In each case assuming no adjustment to the merger consideration and that the currently outstanding 373,989 shares of Delavan common stock remain unchanged at the closing, ifIf the reference price were less than or equal to the minimum of $39.50,$64.00, each share of DelavanSTC common stock would instead be entitled to 1.2860.781 shares of Wintrust common stock, and if the reference price were greater than or equal to the maximum of $49.50,$76.00, each share of DelavanSTC common stock would be entitled to 1.0270.658 shares of Wintrust common stock. Assuming no adjustment tothat the merger considerationnumber of outstanding shares of STC common stock outstanding of 449,229 remains unchanged at the closing and assuming that the reference price is between $39.50 and $49.50,no greater than $64.00, we estimate that Wintrust may issue up to 500,000350,961 shares of Wintrust common stock to DelavanSTC shareholders as contemplated by the merger agreement.


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Wintrust common stock is traded on the NASDAQNasdaq Global Select Market, which we refer to as Nasdaq, under the symbol “WTFC.” The closing price of Wintrust common stock on November 25, 2014July 8, 2019 was $45.58$71.18 per share.

The merger cannot be completed unless the holders of at least a majority of the outstanding shares of DelavanSTC common stock entitled to vote adopt the merger agreement.Your board of directors has unanimously adopted the merger agreement as amended on November 19, 2014 and as it may be amended from time to time and recommends that you vote “FOR”FOR the adoption of the merger agreement at the special meeting. Your board of directors also unanimously recommends that you vote “FOR”FOR the appointment of Michael J. MurphyAnthony V. Sisto and any successors thereto to serve as the Shareholders’ Agentshareholders’ representative upon adoption of the merger agreement, including the appointment of James SaerKeith Kotche to serve as the Alternate Shareholders’ Agent,alternate shareholders’ representative, and “FOR”FOR the approval to adjourn the special meeting to permit further solicitation in the event that an insufficient number of shares are present in person or by proxy to adopt the merger agreement and the transactions contemplated thereby and appoint the Shareholders’ Agentshareholders’ representative and the Alternate Shareholders’ Agent.alternate shareholders’ representative.

Additional information regarding the merger, the merger agreement, DelavanSTC and Wintrust is set forth in the attached proxy statement/prospectus. This document also serves as the prospectus for up to 525,000405,023 shares of Wintrust common stock that may be issued by Wintrust in connection with the merger. We urge you to read this entire document carefully, including the section entitled “Risk Factors” beginning on page 18.19.

 

Sincerely,

Sincerely,

Anthony V. Sisto

Michael J. Murphy

Chairman

President and Chief Executive Officer

Delavan

STC Bancshares Inc.Corp.

Neither the Securities and Exchange Commission nor any state securities regulatory body has approved or disapproved of the securities to be issued under this proxy statement/prospectus or determined if this proxy statement/prospectus is accurate or adequate. Any representation to the contrary is a criminal offense.

The securities to be issued in connection with the merger are not savings or deposit accounts or other obligations of any bank or nonbank subsidiary of any of the parties, and they are not insured by the Federal Deposit Insurance Corporation or any other governmental agency.

This proxy statement/prospectus is dated      , 2014,2019, and is first being mailed to DelavanSTC shareholders on or about      , 2014.

2019.


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REFERENCES TO ADDITIONAL INFORMATION

As permitted by the rules of the Securities and Exchange Commission this proxy statement/prospectus incorporates important business and financial information about Wintrust from other documents that are not included in or delivered with this proxy statement/prospectus. These documents are available to you without charge upon your written or oral request. You can obtain documents incorporated by reference in this proxy statement/prospectus through the SEC’s website at www.sec.gov or by requesting them in writing or by telephone at the following address and telephone number:

Wintrust Financial Corporation


9700 W. Higgins Road, Suite 800


Rosemont, Illinois 60018


Attention: Lisa J. Pattis

Kathleen M. Boege
Executive Vice President, General Counsel and Corporate Secretary


(847) 939-9000

In order to ensure timely delivery of these documents, you should make your request by      , 2015 2019 to receive them before the special meeting.

See “Where You Can Find More Information” beginning on page 78.87.

VOTING BY MAIL

Delavan

STC shareholders of record may submit their proxies by mail, by signing and dating each proxy card you receive, indicating your voting preference on each proposal and returning each proxy card in the prepaid envelope which accompanied that proxy card.



DELAVAN BANCSHARES, INC.

820 Geneva Street

Delavan, Wisconsin 53115Table of Contents

 

STC BANCSHARES CORP.

 

460 S. 1st Street
St. Charles, Illinois 60174


Notice of Special Meeting of Shareholders

Date:Date:      , 20152019

Time:Time:      , local time

Place:

Place:

TO DELAVANSTC BANCSHARES INC.CORP. SHAREHOLDERS:

NOTICE IS HEREBY GIVEN that DelavanSTC Bancshares Inc.Corp. will hold a special meeting of shareholders on      , 20152019 at      , local time, at      . The purpose of the meeting is to consider and vote on the following matters:

 

·a proposal to adopt the Agreement and Plan of Merger, dated as of October 13, 2014,June 5, 2019, by and among Wintrust Financial Corporation, WintrustWTFC STCBC Merger Co.Sub LLC and DelavanSTC Bancshares Inc.,Corp, as amended on November 19, 2014by the Amendment to the Agreement and Plan of Merger, dated as it may be amended from time to time.of July 1, 2019, by and among Wintrust Financial Corporation, WTFC STCBC Merger Sub LLC and STC Bancshares Corp. A copy of such merger agreement is included as Annex AA-1 to the proxy statement/prospectus accompanying this notice and a copy of such amendment to the merger agreement is included as Annex A-2 to the proxy statement/prospectus accompanying this notice;

 

·a proposal to appoint Michael J. MurphyAnthony V. Sisto and any successors thereto as the shareholders’ agentrepresentative and attorney-in-fact pursuant to the merger agreement, including the appointment of James SaerKeith Kotche as the alternate agentshareholders’ representative and attorney-in-fact, with respect to taking any and all actions upon the adoption of the merger agreement that are specified or contemplated by the merger agreement, the escrow agreement or the reserve agreement (including as manager of a limited liability company to be formed for the benefit of STC shareholders to manage certain customer litigation) on behalf of all DelavanSTC shareholders;

 

·the approval to adjourn the special meeting to permit further solicitation in the event that an insufficient number of shares are present in person or by proxy to adopt the merger agreement and the transactions contemplated thereby and appoint the Shareholders’ Agentshareholders’ representative and the Alternate Shareholders’ Agent;alternate shareholders’ representative under the merger agreement; and

 

·to transact any other business that properly comes before the special meeting, or any adjournments or postponements thereof.

Holders of record of DelavanSTC common stock at the close of business on      , 20142019 are entitled to receive this notice and to vote at the special meeting and any adjournments or postponements thereof. Adoption of the merger agreement and approval of the proposal to appoint Michael J. MurphyAnthony V. Sisto and any successors thereto to serve as the Shareholders’ Agentshareholders’ representative upon the adoption of the merger agreement, including James Saerthe appointment of Keith Kotche to serve as the Alternate Shareholders’ Agent,alternate shareholders’ representative, each requirerequires the affirmative vote at the special meeting of holders of at least a majority of the outstanding shares of DelavanSTC common stock entitled to vote. Approval of the proposal to adjourn the special meeting, if necessary, requires the affirmative vote of holders of at least 51%a majority of the shares of DelavanSTC common stock entitled to vote, present in person or by proxy, if a quorum is present. In the absence of a quorum, the holders of at least 51%a majority of the shares of DelavanSTC common stock present, in person or by proxy, may adjourn the special meeting.


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The board of directors of DelavanSTC unanimously recommends that you vote “FOR”FOR adoption of the merger agreement. Your board of directors also unanimously recommends that you vote “FOR”FOR the appointment of Michael J. MurphyAnthony V. Sisto and any successors thereto as the Shareholders’ Agentshareholders’ representative upon the adoption of the merger agreement, including the appointment of James SaerKeith Kotche as the Alternate Shareholders’ Agent,alternate shareholders’ representative, and “FOR”FOR approval to adjourn the special meeting to permit further solicitation in the event that an insufficient number of shares are present in person or by proxy to adopt the merger agreement and the transactions contemplated thereby and appointment of the Shareholders’ Agentshareholders’ representative and the Alternate Shareholders’ Agent.

alternate shareholders’ representative.


Your vote is important. To ensure that your shares are voted at the special meeting, please promptly complete, sign and return the proxy form in the enclosed prepaid envelope whether or not you plan to attend the meeting in person. Shareholders who attend the special meeting may revoke their proxies and vote in person, if they so desire.

Delavan, Wisconsin

St. Charles, Illinois
     , 20142019

 

By Order of the Board of Directors

Michael J. Murphy

Anthony V. Sisto

President and Chief Executive Officer

Chairman


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TABLE OF CONTENTS

 

PAGE

SUMMARY

5

SUMMARY

6

RISK FACTORS

18

19

Risks relating to the merger

18

19

Risks relating to the businesses of Wintrust and the combinedsurviving company

21

23

SPECIAL NOTES CONCERNING FORWARD-LOOKING STATEMENTS

22

24

INFORMATION ABOUT THE SPECIAL MEETING OF DELAVANSTC SHAREHOLDERS

25

27

Date, time and place of the special meeting

25

27

Purpose of the special meeting

25

27

Record date and voting rights for the special meeting

25

27

Quorum

25

27

Vote required

25

27

Shares held by DelavanSTC directors; voting agreement

26

28

How to vote

26

28

Revocability of proxies

26

28

Proxy solicitation

26

29

Other business; adjournments

27

29

THE MERGER

27

29

General

27

General

29

The companies

27

29

Delavan’sSTC’s proposals

28

30

Background of the merger

28

31

Fairness Opinion of Delavan’sSTC’s Financial Advisor

30

34

Delavan’sCertain unaudited prospective financial information of STC

47

STC’s reasons for the merger and recommendation of the board of directors

39

47

Wintrust’s reasons for the merger

41

49

Material U.S. federal income tax consequences of the merger

41

49

Regulatory approvals

44

52

Interests of certain persons in the merger

45

52

Voting agreement

45

53

Restrictions on resale of Wintrust common stock

46

54

DelavanSTC shareholder dissenters’ rights

46

54

DESCRIPTION OF THE MERGER AGREEMENT

48

56

General

48

General

56

Closing and effective time

48

56

Consideration to be received in the merger

48

57

Fractional shares

51

59

Treatment of DelavanSTC options

51

60

Appointment of Shareholders’ AgentRepresentative

51

60

Exchange of certificates

51

60

Conduct of business pending the merger and certain covenants

52

61

No solicitation of or discussions relating to an acquisitiona company takeover proposal

54

63

Representations and warranties

54

63

Conditions to completion of the merger

55

65

i


Termination

57

67

Termination fee

58

67

Management of Wintrust and the surviving corporationcompany after the merger

58

68

Employee benefit matters

58

68

Expenses

59

69

NASDAQNasdaq stock listing

69


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ii


QUESTIONS AND ANSWERS ABOUT THE MERGER

 

Q:What am I being asked to vote on? What is the proposed transaction?

Q:What am I being asked to vote on? What is the proposed transaction?

 

A:You are being asked to vote on the adoption of the merger agreement that provides for Wintrust’s acquisition of Delavan through the merger of Delavan with and into Wintrust Merger Co., a wholly-owned subsidiary of Wintrust. Upon completion of the merger, all shares of Delavan common stock will be cancelled and you will become a shareholder of Wintrust. You are also being asked to vote on the approval of Michael J. Murphy and any successors thereto to serve as the Shareholders’ Agent upon adoption of the merger agreement, including the appointment of James Saer to serve as the Alternate Shareholders’ Agent, with respect to taking any and all actions specified or contemplated by the merger agreement on behalf of all Delavan shareholders.

A:                                   You are being asked to vote on the adoption of the merger agreement that provides for Wintrust’s acquisition of STC through the merger of STC with and into WTFC STCBC Merger Sub LLC, a wholly-owned subsidiary of Wintrust. Upon completion of the merger, all shares of STC common stock will be cancelled and you will become a shareholder of Wintrust. You are also being asked to vote on the approval of Anthony V. Sisto and any successors thereto to serve as the shareholders’ representative upon adoption of the merger agreement, including the appointment of Keith Kotche to serve as the alternate shareholders’ representative, with respect to taking any and all actions specified or contemplated by the merger agreement, the escrow agreement or the reserve agreement (including as manager of a limited liability company to be formed for the benefit of STC shareholders to manage certain customer litigation, which we refer to herein as the litigation entity)  on behalf of all STC shareholders.

 

Q:What will Delavan shareholders be entitled to receive in the merger?

Q:What will STC shareholders be entitled to receive in the merger?

 

A:If the merger is completed, the shares of Delavan common stock that you own immediately before the completion of the merger will be converted into the right to receive cash and shares of Wintrust common stock (in each case subject to possible adjustment). The aggregate merger consideration paid by Wintrust to Delavan shareholders is expected to be approximately $38,000,000, subject to possible downward adjustment as described below. Assuming that the reference price as described below is between $39.50 and $49.50, 50% of the aggregate merger consideration will be paid in shares of Wintrust common stock and 50% will be paid in cash.

A:                                   If the merger is completed, the shares of STC common stock that you own immediately before the completion of the merger will be converted into the right to receive cash and shares of Wintrust common stock (in each case subject to possible adjustment). The merger consideration paid by Wintrust to STC shareholders is expected to be $100 per share of outstanding STC common stock, or an aggregate of approximately $44,922,900, based on 449,229 shares of STC common stock outstanding as of       , 2019, subject to an escrow holdback, possible upward or downward adjustment as described below, and fluctuations in the trading price of Wintrust common stock. Assuming that the reference price as described below is at least $64.00 and no greater than $76.00 and no deduction from the escrowed funds and no adjustment to the merger consideration, 50% of the aggregate merger consideration will be paid in shares of Wintrust common stock and 50% will be paid in cash.

For each of your shares of DelavanSTC common stock, you will receive the per share merger consideration to be calculated as set forth in the merger agreement. The exchange ratio used to determine the number of shares of Wintrust common stock that you will be entitled to receive for each share of DelavanSTC common stock will be determined based on the average high and low saleof the volume-weighted average price of Wintrust common stock as reported under the heading “Bloomberg VWAP” on NASDAQ, which we refer to as the reference price,Bloomberg page for Wintrust for each trading day during the 10five trading day period ending on the second trading day prior to completion of the merger, which we refer to as the reference price, subject to a minimum and maximum reference price equal to $39.50$64.00 and $49.50,$76.00, respectively. Assuming no deduction from the escrowed funds and no adjustment to the merger consideration and that the currently outstanding 373,989 shares of Delavan common stock outstanding remain unchanged at the closing, based on a reference price of $      , which is equal to the reference price if it were calculated as of      , 2014,2019, the latest practicable date prior to the date of this proxy statement/prospectus, the merger consideration that a DelavanSTC shareholder would be entitled to receive for each share of DelavanSTC common stock would be $      in cash and       shares of Wintrust common stock. In each case assuming no adjustment to the merger consideration and that the currently outstanding 373,989 shares of Delavan common stock remain unchanged at the closing, ifIf the reference price were less than or equal to the minimum of $39.50,$64.00, each share of DelavanSTC common stock would instead be entitled to 1.2860.781 shares of Wintrust common stock, and if the reference price were greater than or equal to the maximum of $49.50,$76.00, each share of DelavanSTC common stock would be entitled to 1.0270.658 shares of Wintrust common stock. For a description of how the per share merger consideration will be calculated, see “Description of the Merger Agreement—Consideration to be received in the merger” on page 48.57.

$2,900,000 of the cash portion of the merger consideration, which we refer to as the escrowed funds, will be deposited in special purpose non-interest bearing escrow accounts, which we refer to as the escrow holdback. Pursuant to an escrow agreement entered into among Wintrust, the shareholders’ representative and The Chicago Trust Company, N.A., as escrow agent, which we refer to as the escrow agreement, $2,500,000, which we refer to as the escrow amount, will be held for a period of up to 15 months for the purposes of funding STC’s indemnification obligations under the merger agreement and supplementing the reserve amount referred to below by up to $500,000. Pursuant to a separate escrow agreement entered into among the shareholders’ representative, the litigation entity and The Chicago Trust Company, N.A., as escrow agent, which we refer to as the reserve agreement, $400,000, which we refer to as the reserve amount, will be deposited in a special purpose non-interest bearing account to fund the shareholders’


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obligation to indemnify the shareholders’ representative (including reimbursement of expenses) and the expenses of the litigation entity in taking any actions relating to certain customer litigation. The reserve amount will be held until such customer litigation has been resolved, concluded, settled or decided not to pursue further, but not more than five years from the commencement of the customer litigation. A claim against the escrowed funds may reduce the aggregate cash consideration to be distributed to the STC shareholders in connection with the merger.  Any amounts received by the litigation entity may increase the reserve amount to be distributed to the STC shareholders.

Assuming there are 449,229 issued and outstanding shares of STC stock immediately prior to the effective time and the escrowed funds equal $2,900,000 in the aggregate, then the per share escrow holdback would be $6.46 per share of STC stock. For further information on the escrow holdback and the disbursement of the escrowed funds, see “Description of the Merger Agreement—Consideration to be received in the merger —Escrow Holdback” on page 59.

In addition, the merger consideration may be adjusted upward or downward, as the case may be, if the balance sheet delivered to Wintrust by DelavanSTC as of the closing date of the merger reflects that Delavan’sSTC’s shareholders’ equity, as determined pursuant to the merger agreement and subject to certain exclusions described therein, is greater than or less than $26,000,000, or$30,700,000, plus the amount of proceeds credited from the exercise of outstanding options. Any adjustment will be made to account for certain environmental conditions that may be discovered in the real propertycash portion of Delavan or its subsidiaries.the merger consideration. For a description of the possible adjustment of the merger consideration, see “Description of the Merger Agreement—Consideration to be received in the merger—Adjustmentmerger —Adjustment to Merger Consideration” on page 50.58.

 

Q:What will holders of Delavan options be entitled to receive in the merger?

Q:What will holders of STC options be entitled to receive in the merger?

 

A:

If the merger is completed, each outstanding and unexercised option to acquire a share of Delavan common stock, which we refer to as a Delavan

A:                                   If the merger is completed, each outstanding and unexercised option to acquire a share of STC common stock, which we refer to as a STC option, will be converted into an option to acquire shares of Wintrust common stock, which we refer to as a converted option. The number of shares of Wintrust common stock subject to each converted option will be equal to the product obtained by multiplying (1) the number of shares of STC common stock subject to such STC option by (2) the quotient obtained by dividing an amount in cash equal to the aggregate value of the per share merger consideration (assuming no deductions from the escrowed funds) by the reference price. We refer to such quotient as the option exchange ratio. The per share exercise price for each converted option will be equal to the quotient obtained by dividing (1) the per share exercise price of the STC option by (2) the option exchange ratio. Upon exercise of each converted option, the aggregate number of shares of Wintrust common stock deliverable upon such exercise will be rounded down, if necessary, to the nearest whole share and the aggregate exercise price will be rounded up, if necessary, to the nearest cent. Except as described above, each converted option will be governed by the same terms and conditions as in effect immediately prior to the effective time of the merger.

number of shares of Delavan common stock subject to such Delavan option by (2) the quotient obtained by dividing the per share merger consideration by the reference price, which we refer to as the option exchange ratio. The per share exercise price for each converted option will be equal to the quotient obtained by dividing (1) the per share exercise price of the Delavan option by (2) the option exchange ratio. Upon exercise of each converted option, the aggregate number of shares of Wintrust common stock deliverable upon such exercise will be rounded down, if necessary, to the nearest whole share and the aggregate exercise price will be round up, if necessary, to the nearest cent. Except as described above, each converted option will be governed by the same terms and conditions as in effect immediately prior to the effective time of the merger.

 

Q:Why do Delavan and Wintrust want to engage in the merger?

Q:Why do STC and Wintrust want to engage in the merger?

 

A:Delavan believes that the merger will provide Delavan shareholders with substantial benefits and that it presents the best option to maximize shareholder value, and Wintrust believes that the merger will further its strategic growth plans by allowing it to expand its presence in southeastern Wisconsin. As a larger company, Wintrust can provide greater capital and resources and efficiencies from integrating the operations of Community Bank CBD, a wholly-owned subsidiary of Delavan, into Wintrust’s existing operations and allow Community Bank to compete more effectively and to offer a broader array of products and services to better serve its banking customers. To review the reasons for the merger in more detail, see “The Merger—Wintrust’s reasons for the merger” on page 41 and “The Merger—Delavan’s reasons for the merger and recommendation of the board of directors” on page 39.

A:                                   STC believes that the merger will provide STC shareholders with substantial benefits and that it presents the best option to maximize shareholder value, and Wintrust believes that the merger will further its strategic growth plans by allowing it to expand its presence in the western suburbs of the Chicago metropolitan area. As a larger company, Wintrust can provide greater capital and resources and efficiencies from integrating the operations of STC Capital Bank, a wholly-owned subsidiary of STC, into Wintrust’s existing operations and allow STC Capital Bank to compete more effectively and to offer a broader array of products and services to better serve its banking customers. To review the reasons for the merger in more detail, see “The Merger—Wintrust’s reasons for the merger” on page 49 and “The Merger—STC’s reasons for the merger and recommendation of the board of directors” on page 47.

 

Q:What does the Delavan board of directors recommend?

Q:What does the STC board of directors recommend?

 

A:Delavan’s board of directors unanimously recommends that you vote “FOR” adoption of the merger agreement, as amended on November 19, 2014 and as it may be amended from time to time, “FOR” the appointment of Michael J. Murphy and any successors thereto to serve as the Shareholders’ Agent upon adoption of the merger agreement, including the appointment of James Saer to serve as the Alternate Shareholders’ Agent, and “FOR” the approval to adjourn the special meeting to permit further solicitation in the event that an insufficient number of shares are present in person or by proxy to adopt the merger agreement and the transactions contemplated thereby and appointment of the Shareholders’ Agent and the Alternate Shareholders’ Agent. Delavan’s board of directors has determined that the merger agreement and the merger are in the best interests of Delavan and its shareholders. To review the background and reasons for the merger in greater detail, see “The Merger” beginning on page 27.

A:                                   STC’s board of directors unanimously recommends that you vote “FOR” adoption of the merger agreement, “FOR” the appointment of Anthony V. Sisto and any successors thereto to serve as the

shareholders’ representative upon adoption of the merger agreement, including the appointment of Keith Kotche to serve as the alternate shareholders’ representative, and “FOR” the approval to adjourn the special meeting to permit further solicitation in the event that an insufficient number of shares are present in person or by proxy to adopt the merger agreement and the transactions contemplated thereby and appointment of the shareholders’ representative and the alternate shareholders’ representative. STC’s board of directors has determined that the merger agreement and the merger are in the best interests of STC and its shareholders. To review the background and reasons for the merger in greater detail, see “The Merger” beginning on page 29.

 

Q:What vote is required to adopt the merger agreement?

Q:What vote is required to adopt the merger agreement?

 

A:Holders of at least a majority of the outstanding shares of Delavan common stock entitled to vote must vote in favor of the merger. Abstentions and broker non-votes have the effect of votes against the adoption of the merger agreement. On October 13, 2014, all of Delavan’s directors who own shares of Delavan common stock agreed to vote their shares at the special meeting in favor of the merger and any other matter necessary for consummation of the transactions contemplated by the merger agreement. These shareholders and their affiliates owned approximately 28% of Delavan common stock outstanding as of September 30, 2014. Wintrust’s shareholders will not be voting on the merger agreement. See “The Merger—Interests of certain persons in the merger” on page 45 and “The Merger—Voting agreement” on page 45.

A:                                   Holders of at least a majority of the outstanding shares of STC common stock entitled to vote must vote in favor of the merger. Abstentions and broker non-votes have the effect of votes against the adoption of the merger agreement. On June 5, 2019, certain of STC’s directors who own shares of STC common stock agreed to vote their shares at the special meeting in favor of the merger and any other matter necessary for consummation of the transactions contemplated by the merger agreement. These shareholders and their affiliates owned approximately 46% of STC common stock outstanding as of June 5, 2019. Wintrust’s shareholders will not be voting on the merger agreement. See “The Merger—Interests of certain persons in the merger” on page 52 and “The Merger—Voting agreement” on page 53.

 

Q:What vote is required to appoint the Shareholders’ Agent and the Alternate Shareholders’ Agent upon adoption of the merger agreement?

Q:What vote is required to appoint the shareholders’ representative and the alternate shareholders’ representative upon adoption of the merger agreement?

 

A:

Holders of at least a majority of the outstanding shares of Delavan common stock entitled to vote must vote in favor of the appointment of Michael J. Murphy and any successors thereto as Shareholders’ Agent upon adoption of the merger agreement, including the appointment of James Saer as Alternate Shareholders’ Agent. Abstentions and broker non-votes have the effect of votes against appointment of Mr. Murphy and any successors thereto as Shareholders’ Agent upon adoption of the merger agreement, including Mr. Saer as Alternate Shareholders’ Agent. If a shareholder does not vote in favor of appointing Mr. Murphy

A:                                   Holders of at least a majority of the outstanding shares of STC common stock entitled to vote must vote in favor of the appointment of Anthony V. Sisto and any successors thereto as shareholders’ representative upon adoption of the merger agreement, including the appointment of Keith Kotche as alternate shareholders’ representative. Abstentions and broker non-votes have the effect of votes against the appointment of Mr. Sisto and any successors thereto as shareholders’ representative upon adoption of the merger agreement, including Mr. Kotche as alternate shareholders’ representative. If a shareholder does not vote in favor of appointing Mr. Sisto and any successors thereto as shareholders’ representative upon adoption of the merger agreement, including Mr. Kotche as alternate shareholders’ representative, but Mr. Sisto and Mr. Kotche nonetheless receive the approval of at least a majority of the outstanding shares of STC common stock entitled to vote, Mr. Sisto and any successors thereto will serve as the shareholders’ representative for all shareholders upon adoption of the merger agreement, including Mr. Kotche as the alternate shareholders’ representative, regardless of whether a particular shareholder may have voted for such individuals to serve in that capacity.

any successors thereto as Shareholders’ Agent upon adoption of the merger agreement, including Mr. Saer as Alternate Shareholders’ Agent, but Mr. Murphy and Mr. Saer nonetheless receive the approval of at least a majority of the outstanding shares of Delavan common stock entitled to vote, Mr. Murphy and any successors thereto will serve as the Shareholders’ Agent for all shareholders upon adoption of the merger agreement, including Mr. Saer as the Alternate Shareholders’ Agent, regardless of whether a particular shareholder may have voted for such individuals to serve in that capacity.

 

Q:What vote is required to approve the proposal to adjourn the special meeting to permit further solicitation in the event that an insufficient number of shares are present in person or by proxy to adopt the merger agreement and the transactions contemplated thereby?

Q:What vote is required to approve the proposal to adjourn the special meeting to permit further solicitation in the event that an insufficient number of shares are present in person or by proxy to adopt the merger agreement and the transactions contemplated thereby?

 

A:The proposal to adjourn the special meeting, if necessary or appropriate to solicit additional proxies, requires the affirmative vote of at least 51% of the shares of Delavan common stock entitled to vote, present in person or by proxy, if a quorum is present at the special meeting. In the absence of a quorum, holders of at least 51% of the shares of Delavan common stock present in person or by proxy at the special meeting may adjourn the special meeting. Abstentions and broker non-votes have the effect of votes against the proposal.

A:                                   The proposal to adjourn the special meeting, if necessary or appropriate to solicit additional proxies, requires the affirmative vote of at least a majority of the shares of STC common stock entitled to vote, present in person or by proxy, if a quorum is present at the special meeting. In the absence of a quorum, holders of at least a majority of the shares of STC common stock present in person or by proxy at the special meeting may adjourn the special meeting. Abstentions have the effect of votes against the proposal, and broker non-votes will not be considered entitled to vote and will have no effect on the proposal.

 

Q:Why is my vote important?

Q:Why is my vote important?

 

A:Delavan’s shareholders are being asked to adopt the merger agreement and thereby approve the merger. If you do not submit your proxy by mail or vote in person at the special meeting, it will be more difficult for Delavan to obtain the necessary quorum to hold the special meeting. In addition, your failure to submit your proxy or attend the special meeting will have the same effect as a vote against the merger agreement and make it more difficult to obtain adoption of the merger agreement.

A:                                   STC’s shareholders are being asked to adopt the merger agreement and thereby approve the merger. If you do not submit your proxy by mail or vote in person at the special meeting, it will be more difficult for STC to obtain the necessary quorum to hold the special meeting. In addition, your failure to submit your proxy or attend the special meeting will have the same effect as a vote against the merger agreement and make it more difficult to obtain adoption of the merger agreement.

Q:What do I need to do now? How do I vote?

 

Q:What do I need to do now? How do I vote?

A:                                   You may vote at the special meeting if you own shares of STC common stock of record at the close of business on the record date for the special meeting,      , 2019. After you have carefully read and considered the information contained in this proxy statement/prospectus, please complete, sign, date and mail your proxy form in the enclosed prepaid return envelope as soon as possible. This will enable your shares to be represented at the special meeting. You may also vote in person at the special meeting. If you do not return a properly executed proxy form and do not vote at the special meeting, this will have the same effect as a vote against the adoption of the merger agreement.

 

A:You may vote at the special meeting if you own shares of Delavan common stock of record at the close of business on the record date for the special meeting,             , 2014. After you have carefully read and considered the information contained in this proxy statement/prospectus, please complete, sign, date and mail your proxy form in the enclosed prepaid return envelope as soon as possible. This will enable your shares to be represented at the special meeting. You may also vote in person at the special meeting. If you do not return a properly executed proxy form and do not vote at the special meeting, this will have the same effect as a vote against the adoption of the merger agreement.

Q:How will my proxy be voted?

 

Q:How will my proxy be voted?

A:                                   If you complete, sign, date and mail your proxy form, your proxy will be voted in accordance with your instructions. If you sign, date and send in your proxy form, but you do not indicate how you want to vote, your proxy will be voted FOR adoption of the merger agreement and the other proposals in the notice.

 

A:If you complete, sign, date and mail your proxy form, your proxy will be voted in accordance with your instructions. If you sign, date and send in your proxy form, but you do not indicate how you want to vote, your proxy will be voted FOR adoption of the merger agreement and the other proposals in the notice.

Q:Can I revoke my proxy and change my vote?

 

Q:Can I revoke my proxy and change my vote?

A:                                   You may change your vote or revoke your proxy at any time before it is voted by filing with the secretary of STC a duly executed revocation of proxy or submitting a new proxy form with a later date. You may also revoke a prior proxy by voting in person at the special meeting.

 

A:You may change your vote or revoke your proxy at any time before it is voted by filing with the secretary of Delavan a duly executed revocation of proxy or submitting a new proxy form with a later date. You may also revoke a prior proxy by voting in person at the special meeting.

Q:What if I oppose the merger? Do I have dissenters’ rights?

 

Q:What if I oppose the merger? Do I have dissenters’ rights?

A:                                   STC shareholders who do not vote in favor of adoption of the merger agreement and who otherwise comply with all of the procedures of Sections 11.65 and 11.70 of the Illinois Business Corporation Act, which we refer to as the IBCA, will be entitled to receive payment in cash of the fair value of their shares of STC common stock as ultimately determined under the statutory process. A copy of these sections of the IBCA is attached as Annex B to this document.

 

A:Delavan shareholders who do not vote in favor of adoption of the merger agreement and who otherwise comply with all of the procedures of Sections 18.1301 through 180.1331 of the Wisconsin Business Corporation Law, which we refer to as the WBCL, will be entitled to receive payment in cash of the fair value of their shares of Delavan common stock as ultimately determined under the statutory process. A copy of these sections of the WBCL is attached asAnnex B to this document.

Q:What are the tax consequences of the merger to me?

Q:What are the tax consequences of the merger to me?

 

A:In general, the conversion of your shares of Delavan common stock into Wintrust common stock in the merger will be tax-free for United States federal income tax purposes. However, you generally will recognize gain (but not loss) in an amount limited to the amount of cash you receive in the merger. Additionally, you will recognize gain or loss on any cash that you receive in lieu of fractional shares of Wintrust’s common stock. You should consult with your tax adviser for the specific tax consequences of the merger to you. See “The Merger—Material U.S. federal income tax consequences of the merger” on page 41.

A:                                   STC and Wintrust intend for the merger to qualify as a “reorganization” pursuant to Section 368(a) of the Internal Revenue Code of 1986, as amended, which we refer to as the Code. Provided the merger qualifies as a reorganization for United States federal income tax purposes, you may recognize gain, but will not recognize loss, upon the exchange of your shares of STC common for shares of Wintrust common stock and cash.  If the sum of the fair market value of the Wintrust common stock and the amount of cash you receive in exchange for your shares of STC common stock exceeds the adjusted basis of your shares of STC common stock, you will recognize taxable gain equal to the lesser of the amount of such excess or the amount of cash you receive in the exchange. Additionally, you will recognize gain or loss on any cash that you receive in lieu of fractional shares of Wintrust’s common stock. Generally, any gain recognized upon the exchange will be capital gain, and any such capital gain will be long-term capital gain if you have established a holding period of more than one year for your shares of STC common stock.  Depending on certain facts specific to you, any gain could instead be characterized as ordinary dividend income.  You should consult with your tax adviser for the specific tax consequences of the merger to you. See “The Merger—Material U.S. federal income tax consequences of the merger” on page 49.

 

Q:When and where is the special meeting?

Q:When and where is the special meeting?

 

A:The Delavan special meeting will take place on             , 2015, at          local time, at                     .

A:                                   The STC special meeting will take place on      , 2019, at       local time, at       .

 

Q:Who may attend the meeting?

Q:Who may attend the meeting?

 

A:Delavan shareholders on the record date may attend the special meeting. If you are a shareholder of record, you may need to present proof of identification in order to be admitted into the meeting.

A:                                   STC shareholders on the record date may attend the special meeting. If you are a shareholder of record, you may need to present proof of identification in order to be admitted into the meeting.

Q:Should I send in my stock certificates now?

 

Q:Should I send in my stock certificates now?

A:                                   No. After the merger is completed, the exchange agent for the merger will send you a letter of transmittal with instructions informing you how to send in your stock certificates to the exchange agent. You should use the letter of transmittal to exchange your STC stock certificates for the merger consideration. Do not send in your stock certificates with your proxy form.

 

A:No. After the merger is completed, the exchange agent for the merger will send you a letter of transmittal with instructions informing you how to send in your stock certificates to the exchange agent. You should use the letter of transmittal to exchange your Delavan stock certificates for the merger consideration.Do not send in your stock certificates with your proxy form.

Q:When is the merger expected to be completed?

 

Q:When is the merger expected to be completed?

A:                                   We will try to complete the merger as soon as reasonably possible. Before that happens, the merger agreement must be adopted by STC’s shareholders and we must obtain the necessary regulatory approvals. Assuming shareholders vote to approve the merger and adopt the merger agreement and we obtain the other necessary approvals and satisfaction or waiver of the other conditions to the closing described in the merger agreement, we expect to complete the merger in the third quarter of 2019. See “Description of the Merger Agreement—Conditions to completion of the merger” on page 65.

 

A:We will try to complete the merger as soon as reasonably possible. Before that happens, the merger agreement must be adopted by Delavan’s shareholders and we must obtain the necessary regulatory approvals. Assuming shareholders vote to approve the merger and adopt the merger agreement and we obtain the other necessary approvals and satisfaction or waiver of the other conditions to the closing described in the merger agreement, we expect to complete the merger in the first quarter of 2015. See “Description of the Merger Agreement—Conditions to completion of the merger” on page 55.

Q:Is completion of the merger subject to any conditions besides shareholder approval?

 

Q:Is completion of the merger subject to any conditions besides shareholder approval?

A:                                   Yes. The transaction must receive the required regulatory approvals, and there are other closing conditions that must be satisfied. See “Description of the Merger Agreement—Conditions to completion of the merger” on page 65.

 

A:Yes. The transaction must receive the required regulatory approvals, and there are other closing conditions that must be satisfied. See “Description of the Merger Agreement—Conditions to completion of the merger” on page 55.

Q:Are there risks I should consider in deciding to vote on the adoption of the merger agreement?

 

Q:Are there risks I should consider in deciding to vote on the adoption of the merger agreement?

A:                                   Yes, in evaluating the merger agreement, you should read this proxy statement/prospectus carefully, including the factors discussed in the section titled “Risk Factors” beginning on page 19.

 

A:Yes, in evaluating the merger agreement, you should read this proxy statement/prospectus carefully, including the factors discussed in the section titled “Risk Factors” beginning on page 18.

Q:Who can answer my other questions?

 

Q:Who can answer my other questions?

A:                                   If you have more questions about the merger or how to submit your proxy, or if you need additional copies of this proxy statement/prospectus or the enclosed proxy form, you should contact Anthony V. Sisto, STC’s Chairman, at (630) 377-1555, or Christopher Woelffer, STC’s President, at (630) 463-4333.

SUMMARY

 

A:If you have more questions about the merger or how to submit your proxy, or if you need additional copies of this proxy statement/prospectus or the enclosed proxy form, or you need more information about Delavan, you should contact Michael J. Murphy, Delavan’s President and Chief Executive Officer, or Jon Martin, Delavan’s Chief Financial Officer, at (866) 848-2265.

SUMMARY

This summary highlights selected information in this proxy statement/prospectus and may not contain all of the information that is important to you. To understand the merger more fully, you should read this entire proxy statement/prospectus carefully, including the annexes and the documents referred to or incorporated in this proxy statement/prospectus. A copy of the merger agreement is attached as Annex AA-1 and a copy of the amendment to the merger agreement is attached as Annex A-2 to this proxy statement/prospectus and each is incorporated by reference herein. See “Where You Can Find More Information” beginning on page 78.87.

Information about Wintrust and DelavanSTC(See (See page 27)29)

Wintrust Financial Corporation

9700 W. Higgins Road, Suite 800


Rosemont, Illinois 60018


(847) 939-9000

Wintrust Financial Corporation, an Illinois corporation, which we refer to as Wintrust, was incorporated in 1992 and is a financial holding company based in Rosemont, Illinois. Wintrust provides community-oriented, personal and commercial banking services to customers located primarily in the Chicago metropolitan area, southern Wisconsin and in southeastern Wisconsinnorthwest Indiana through its fifteen wholly-owned banking subsidiaries, as well as the origination and purchase of residential mortgages for sale into the secondary market through Wintrust Mortgage, a division of Barrington Bank and Trust Company, N.A. Wintrust provides specialty finance services, including financing for the payment of commercial insurance premiums and life insurance premiums on a national basis through FIRST Insurance Funding, a division of its wholly-owned subsidiary First Insurance Funding CorporationLake Forest Bank & Trust Company, N.A., which we refer to as Lake Forest Bank, and Wintrust Life Finance, a division of Lake Forest Bank, and in Canada through its Canadian premium finance company, First Insurance Funding of Canada, lease financing and other direct leasing opportunities through its wholly-owned subsidiary, Wintrust Asset Finance, and short-term accounts receivable financing and outsourced administrative services through its wholly-owned subsidiary, Tricom, Inc. of Milwaukee. Wintrust also provides a full range of wealth management services primarily to customers in the Chicago metropolitan area, southern Wisconsin and in southeastern Wisconsinnorthwest Indiana through threefour separate subsidiaries, The Chicago Trust Company, N.A., Wayne HummerWintrust Investments, LLC, and Great Lakes Advisors, LLC and Chicago Deferred Exchange Company, LLC.

As of September 30, 2014,March 31, 2019, Wintrust had total assets of approximately $19.2$32.4 billion, total loans, excluding loans held-for-sale, and covered loans, of approximately $14.1$24.2 billion, total deposits of approximately $16.1$26.8 billion, and total shareholders’ equity of approximately $2.0$3.4 billion.

Wintrust common stock, no par value per share, which we refer to as Wintrust common stock, is traded on NASDAQNasdaq under the ticker symbol “WTFC.” Wintrust’s principal executive office is located at 9700 W. Higgins Road, Suite 800, Rosemont, Illinois 60018, telephone number: (847) 939-9000.

WintrustWTFC STCBC Merger Co.Sub LLC

c/o Wintrust Financial Corporation


9700 W. Higgins Road, Suite 800


Rosemont, Illinois 60018


(847) 939-9000

Wintrust

WTFC STCBC Merger Co., a Wisconsin corporation,Sub LLC, an Illinois limited liability company, which we refer to as Merger Co., is a wholly-owned subsidiary of Wintrust and was formed solely for the purpose of consummating the merger. Merger Co. has not carried on any activities to date, except for activities incidental to its formation and activities undertaken in connection with the merger.

DelavanSTC Bancshares Inc.Corp.
 460 S. 1st Street
St. Charles, Illinois 60174
(630) 377-1555

820 Geneva Street

Delavan, Wisconsin 53115

(866) 848-2265

DelavanSTC Bancshares Inc.Corp., a Wisconsinan Illinois corporation, which we refer to as Delavan,STC, is a bank holding company headquartered in Delavan, Wisconsin.St. Charles, Illinois. Its primary business is operating its bank subsidiary, Community

STC Capital Bank, a Wisconsinan Illinois state bank, which we refer to as CommunitySTC Bank, with fourfive banking locations in southeastern Wisconsin. Delavannortheastern Illinois. STC began operations in 1996.January 2006. As of September 30, 2014, DelavanMarch 31, 2019, STC had consolidated total assets of approximately $208$276.7 million, deposits of approximately $167$243.9 million and shareholders’ equity of approximately $27$31.6 million. DelavanSTC is not a public company, and, accordingly, there is no established trading market for DelavanSTC common stock, par value $1.00$0.01 per share, which we refer to as DelavanSTC common stock.

The merger and the merger agreement (See page 48)56)

Wintrust’s acquisition of DelavanSTC is governed by the Agreementagreement and Planplan of Merger,merger dated as of October 13, 2014,June 5, 2019, by and among Wintrust, Merger Co. and Delavan,STC, as amended on November 19, 2014,by the amendment to the agreement and plan of merger dated as of July 1, 2019, which we refer to as the merger agreement. The merger agreement provides that, if all of the conditions set forth in the merger agreement are satisfied or waived, DelavanSTC will be merged with and into Merger Co. and will cease to exist, which we refer to as the merger. After the consummation of the merger, Merger Co. will continue as the surviving corporationcompany and remain a wholly-owned subsidiary of Wintrust. The merger agreement is included asAnnex AA-1 and the amendment to the merger agreement is included as Annex A-2 to this proxy statement/prospectus and each is incorporated by reference herein. We urge you to read the merger agreement carefully and fully, as it is the legal document that governs the merger.

What DelavanSTC shareholders will receive (See(See page 48)57)

If the merger is completed, the shares of DelavanSTC common stock that you own immediately before the completion of the merger will be converted into the right to receive a combination of cash and shares of Wintrust common stock (in each case subject to possible adjustment). The aggregate merger consideration paid by Wintrust to DelavanSTC shareholders is expected to be $100 per share of outstanding STC common stock, or an aggregate of approximately $38,000,000,$44,922,900, based on 449,229 shares of STC common stock outstanding as of       , 2019, subject to an escrow holdback, possible upward or downward adjustment as described below.below, and fluctuations in the trading price of Wintrust common stock. Assuming that the reference price as described below is between $39.50at least $64.00 and $49.50,no greater than $76.00 and no deduction from the escrowed funds and no adjustment to the merger consideration, 50% of the aggregate merger consideration will be paid in shares of Wintrust common stock and 50% will be paid in cash.

For each of your shares of DelavanSTC common stock, you will receive the per share merger consideration to be calculated as set forth in the merger agreement. The exchange ratio used to determine the number of shares of Wintrust common stock that you will be entitled to receive for each share of DelavanSTC common stock will be determined based on the average high and low saleof the volume-weighted average price of Wintrust common stock as reported under the heading “Bloomberg VWAP” on NASDAQ,the Bloomberg page for Wintrust, which we refer to as the reference price, for each trading day during the 10five trading day period ending on the second trading day prior to completion of the merger, which we refer to as the reference period, subject to a minimum and maximum reference price equal to $39.50$64.00 and $49.50,$76.00, respectively. Assuming no deduction from the escrowed funds and no adjustment to the merger consideration, and that the currently outstanding 373,989 shares of Delavan common stock remain unchanged at the closing, based on a reference price of $     , which is equal to the reference price if it were calculated as of      , 2014,2019, the latest practicable date prior to the date of this proxy statement/prospectus, the merger consideration that a DelavanSTC shareholder would be entitled to receive for each share of DelavanSTC common stock, which we refer to as the per share merger consideration, would be $      in cash and       shares of Wintrust common stock. In each case assuming no adjustment to the merger consideration and that the currently outstanding 373,989 shares of Delavan common stock remain unchanged at the closing, ifIf the reference price were less than or equal to the minimum of $39.50,$64.00, each share of DelavanSTC common stock would instead be entitled to 1.2860.781 shares of Wintrust common stock, and if the reference price were greater than or equal to the maximum of $49.50,$76.00, each share of DelavanSTC common stock would be entitled to 1.0270.658 shares of Wintrust common stock. For a description of how the per share merger consideration will be calculated, see “Description of the Merger Agreement—Consideration to be received in the merger.”

Delavan may terminate$2,900,000 of the cash portion of the merger consideration, which we refer to as the escrowed funds, will be deposited in special purpose non-interest bearing escrow accounts, which we refer to as the escrow holdback. Pursuant to the escrow agreement, which we refer to as the escrow agreement, $2,500,000, which we refer to as the escrow amount, will be held for a period of up to 15 months for the purposes of funding STC’s indemnification obligations under the merger agreement ifand supplementing the reference pricereserve amount referred to below by up to $500,000. Pursuant to a separate escrow agreement, which we refer to as the reserve agreement, $400,000, which we refer to as the reserve amount, will be deposited in a special purposes non-interest bearing escrow account to fund the shareholders’ obligation to indemnify the shareholders’ representative (including reimbursement of expenses) and the expenses of the litigation entity in taking any actions relating to certain customer litigation. The reserve amount will be held until such customer litigation has been resolved or concluded, through settlement, judgment or a decision by the litigation entity not to pursue further, but not more than five years from the commencement of the customer litigation. A claim against the escrowed funds may reduce the aggregate shareholder cash consideration to be distributed to the STC shareholders in connection with the merger. Any amounts received by the litigation entity may increase the reserve amount to be distributed to the STC shareholders.  The escrow agent for both accounts is less than $36.50The Chicago Trust Company, N.A., a subsidiary of Wintrust.

Assuming there are 449,229 issued and Wintrust may terminateoutstanding shares of STC stock immediately prior to the effective time and the escrowed funds equal $2,900,000 in the aggregate, then the per share escrow holdback would be $6.46 per share of STC stock. For further information on the escrow holdback and the disbursement of the escrowed funds, see “Description of the Merger Agreement—Consideration to be received in the merger agreement if the reference price is more than $52.50, in each case if Delavan and Wintrust are in good faith unable, after five business days’ notice of such termination, to reach agreement as to an amendment to the merger agreement containing terms acceptable to Wintrust and Delavan so that the merger and the transactions contemplated by the merger agreement may be consummated.—Escrow Holdback” on page 59.

In addition, the merger consideration may be adjusted upward or downward, as the case may be, if the balance sheet delivered to Wintrust by DelavanSTC as of the closing date of the merger, which we refer to as the closing date, reflects that Delavan’sSTC’s shareholders’ equity, as determined pursuant to the merger agreement and subject to certain exclusions described therein, is greater than or less than $26,000,000, or$30,700,000 plus the amount of proceeds credited from the exercise of outstanding options. Any adjustment will be made to account for certain environmental conditions that may be discovered in the real propertycash portion of Delavan or its subsidiaries.the merger consideration. For a description of the possible adjustment of the merger consideration, see “Description of the Merger Agreement—Consideration to be received in the merger—Adjustment to Merger Consideration.”

 

DelavanSTC shareholders will not receive fractional shares of Wintrust common stock. Instead, they will receive a cash payment for any fractional shares based on the value of Wintrust common stock.reference price.

Treatment of DelavanSTC options (See(See page 51)60)

If the merger is completed, each outstanding and unexercised option to acquire a share of DelavanSTC common stock, which we refer to as a DelavanSTC option, will be converted into an option to acquire shares of Wintrust common stock, which we refer to as a converted option. The number of shares of Wintrust common stock subject to each converted option will be equal to the product obtained by multiplying (1) the number of shares of DelavanSTC common stock subject to such DelavanSTC option by (2) the quotient obtained by dividing an amount in cash equal to the aggregate value of the per share merger consideration (assuming no deductions from the escrowed funds) by the reference price, which weprice. We refer to such quotient as the option exchange ratio. The per share exercise price for each converted option will be equal to the quotient obtained by dividing (1) the per share exercise price of the DelavanSTC option by (2) the option exchange ratio. Upon exercise of each converted option, the aggregate number of shares of Wintrust common stock deliverable upon such exercise will be rounded down, if necessary, to the nearest whole share and the aggregate exercise price will be roundrounded up, if necessary, to the nearest cent. Except as described above, each converted option will be governed by the same terms and conditions as in effect immediately prior to the effective time of the merger.

Exchange of certificates (See(See page 51)60)

Once the merger is complete, American Stock Transfer & Trust Company, LLC, which we refer to as the exchange agent, will mail you materials and instructions for exchanging your DelavanSTC stock certificates for shares of Wintrust common stock to be issued by book-entry transfer. You should not send in your DelavanSTC stock certificates with your completed proxy card. Instead, you should wait until you receive the transmittal materials and instructions from the exchange agent.

Material U.S. federal income tax consequences of the merger (See(See page 41)49)

Your receipt of shares of

STC and Wintrust common stockintend for the merger to qualify as parta “reorganization” pursuant to Section 368(a) of the Code. Provided the merger consideration generally will be tax-freequalifies as a reorganization for United States federal income tax purposes. However,purposes, you generallymay recognize gain, but will not recognize loss, upon the exchange of your shares of STC common for shares of Wintrust common stock and cash.  If the sum of the fair market value of the Wintrust common stock and the amount of cash you receive in exchange for your shares of STC common stock exceeds the adjusted basis of your shares of STC common stock, you will recognize taxable gain (but not loss) in anequal to the lesser of the amount limited toof such excess or the amount of cash you receive in the merger.exchange. Additionally, you will recognize gain or loss on any cash that you receive in lieu of fractional shares of Wintrust common stock. Generally, any gain recognized upon the exchange will be capital gain, and any such capital gain will be long-term capital gain if you have established a holding period of more than one year for your shares of STC common stock.  See “The Merger—Material U.S. federal income tax consequences of the merger” on page 49.

Depending on certain facts specific to you, any gain could instead be characterized as ordinary dividend income. Determining the actual tax consequences of the merger to you can be complicated. The tax treatment will depend on your specific situation and many variables not within our control. For these reasons, Youyou are urged to consult your tax adviser for a full understanding of the federal, state, local and foreign tax consequences of the merger to you.

Reasons for the merger (See(See page 39)47)

Delavan’s

STC’s board of directors believes that the merger is in the best interests of DelavanSTC and its shareholders, has unanimously adopted the merger agreement and unanimously recommends that its shareholders vote “FOR” the adoption of the merger agreement.

In its deliberations and in making its determination, Delavan’sSTC’s board of directors considered numerous factors, including the following:

 

·information with respect to the businesses, earnings, operations, financial condition, prospects, capital levels and asset quality of DelavanSTC, Wintrust and Wintrust, both individually and as a combinedthe surviving company;

 

·the perceived risks and uncertainties attendant to Delavan’sSTC’s operation as an independent banking organization, including the risks and uncertainties related to the continuing low-interest rate environment, competition in Delavan’sSTC’s market area, increased regulatory costs and increased capital requirements;

 

·based on the closing price of Wintrust common stock on October 10, 2014June 3, 2019 and Delavan’s June 30, 2014STC’s March 31, 2019 unaudited balance sheet, the aggregate merger considerationtransaction was priced at a multiple of 1.41.508 times the tangible common book value and at a multiple of 1.41.508 times the common book value;

 

·the opinion of Robert W. BairdD.A. Davidson & Co. Incorporated,, which we refer to as Baird,D.A. Davidson, subject to the various assumptions, qualifications and limitations set forth in such fairness opinion, that the per share merger consideration is fair, from a financial point of view, to the holders of DelavanSTC common stock;

 

·the value to be received by Delavan’sSTC’s shareholders in the merger as compared to shareholder value projected for DelavanSTC as an independent entity;

 

·the market value of Wintrust common stock prior to the execution of the merger agreement and the prospects for future appreciation as a result of Wintrust’s strategic initiatives;

 

·Wintrust’s strategy to seek profitable future expansion in Delavan’sSTC’s trade area, leading to continued growth in overall shareholder value;

·the fact that Wintrust is publicly held and the merger would provide access to a public trading market for Delavan’sSTC’s shareholders whose investments currently are in a privately held company, as well as enhanced access to capital markets to finance the combinedsurviving company’s capital requirements; and

 

·the likelihood that the merger will be approved by the relevant bank regulatory authorities without undue burden and in a timely manner.

Wintrust’s board of directors concluded that the merger is in the best interests of Wintrust and its shareholders. In deciding to approve the merger, Wintrust’s board of directors considered a number of factors, including:

 

·management’s view that the acquisition provides an attractive opportunity for Wintrust to expand in the southeastern partwestern suburbs of Wisconsin;

the Chicago metropolitan area;

 

Delavan’s

·                  STC’s community banking orientation and its compatibility with Wintrust and its subsidiaries;

 

·a review of the demographic, economic and financial characteristics of the markets in which DelavanSTC operates, including existing and potential competition and history of the market areas with respect to financial institutions;

 

·management’s review of Delavan’sSTC’s business, operations, earnings and financial condition, including capital levels and asset quality of CommunitySTC Capital Bank;

 

·efficiencies to come from integrating certain of Delavan’sSTC’s operations into Wintrust’s existing operations; and

 

·the likelihood that the merger will be approved by the relevant bank regulatory authorities without undue burden and in a timely manner.

Board recommendation to Delavan’sSTC’s shareholders(See page 39)47)

Delavan’s

STC’s board of directors believes that the merger of DelavanSTC with Wintrust is in the best interests of DelavanSTC and its shareholders.Delavan’sSTC’s board of directors unanimously recommends that you vote “FOR”FOR the merger.merger.

 

Fairness opinion of Delavan’sSTC’s financial advisor (See(See page 30)34)

In deciding to approve the merger, Delavan’sSTC’s board of directors considered, among other things, the opinion of BairdD.A. Davidson as of October 13, 2014June 5, 2019 that the merger consideration is fair, from a financial point of view, to the holders of DelavanSTC common stock. You should read the full text of the fairness opinion, which is attached to this proxy statement asAnnex D, to understand the assumptions made, limits of the reviews undertaken and other matters considered by BairdD.A. Davidson in rendering its opinion.

Interests of officers and directors of Delavan, CommunitySTC, STC Bank, and its subsidiariessubsidiary in the merger may be different from, or in addition to, yours (See(See page 45)52)

When you consider the DelavanSTC board of directors’ recommendation to vote in favor of the adoption of the merger agreement, you should be aware that some of Delavan’s, CommunitySTC’s, STC Bank’s, or its subsidiaries’subsidiary’s directors and officers may have interests in the merger that are different from, or in addition to, your interests as shareholders. Delavan’sSTC’s board of directors was aware of these interests and took them into account in approving the merger. For example, CommunitySt. Charles Bank & Trust Company entered into an employment agreement with Michael J. MurphyChristopher Woelffer, STC’s President and STC Bank’s President and Chief Executive Officer, in connection with Delavan’sSTC’s entry into the merger agreement, pursuant to which heMr. Woelffer will be employed as PresidentVice Chair of CommunitySt. Charles Bank & Trust Company, successor to STC Bank, upon the consummation of the merger. STC Bank

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Table of Contents

and St. Charles Bank & Trust Company also entered into a retention agreement with Jodi Ariss, Senior Vice President of STC Bank, in connection with STC’s entry into the merger agreement, pursuant to which Ms. Ariss is eligible to receive a retention bonus. In addition, Eduardo E. Greco, a director of STC, and certain of his affiliates are parties to loan transactions with certain bank subsidiaries of Wintrust.

Wintrust has also agreed to pay for directors’ and officers’ liability insurance covering the directors and officers of DelavanSTC and CommunitySTC Bank immediately prior to the consummation of the merger, subject to limits on availability and cost, for up to six years.

As of SeptemberJune 30, 2014, Delavan’s2019, STC’s directors and executive officers owned, in the aggregate, 113,593207,016 shares of Delavan’sSTC’s common stock, representing approximately 30%46% of Delavan’sSTC’s outstanding shares of common stock. Mr. MurphySTC’s directors also holdsheld options to purchase 7,250an aggregate of 43,920 shares of DelavanSTC common stock. Jon E. Martin, Delavan’s Chief Financial Officer, and Michael R. Ploch, Delavan’s Senior Vice President – Commercial Lending, are also entitled to stock appreciation rights in amounts equal to approximately $171,000 and $195,000, respectively, (assuming that the reference price is between $39.50 and $49.50) pursuant to the Delavan Bancshares, Inc. 2008 Stock Appreciation Right Plan. All such stock appreciation rights outstanding immediately prior to the effective time will vest and become payable at the effective time.as of June 30, 2019.

DelavanSTC shareholders will have dissenters’ rights in connection with the merger (See(See page 46)54)

Delavan

STC shareholders may dissent from the merger and, upon complying with the requirements of the WBCL,IBCA, receive cash in the amount of the fair value of their shares instead of the merger consideration.

A copy of the sectionsections of the WBCLIBCA pertaining to dissenters’ rights is attached asAnnex Bto this proxy statement/prospectus. You should read the statute carefully and consult with your legal counsel if you intend to exercise these rights.

The merger and the performance of the combinedsurviving company are subject to a number of risks(See page 18)19)

There are a number of risks relating to the merger and to the businesses of Wintrust, DelavanSTC and the combinedsurviving company following the merger. See the “Risk Factors” beginning on page 1819 of this proxy statement/prospectus for a discussion of these and other risks and see also the documents that Wintrust has filed with the Securities and Exchange Commission, which we refer to as the SEC, and which we have incorporated by reference into this proxy statement/prospectus.

DelavanSTC shareholder approval will be required to complete the merger and approve the other proposals set forth in the notice(See page 25)27)

To adopt the merger agreement and approve the appointment of Michael J. MurphyAnthony V. Sisto and any successors thereto to serve as the Shareholders’ Agentshareholders’ representative upon adoption of the merger agreement, including the appointment of James SaerKeith Kotche to serve as Alternate Shareholders’ Agent,alternate shareholders’ representative, at least a majority of the outstanding shares of DelavanSTC common stock

entitled to vote must be voted in favor of each such proposal at the special meeting. The proposal to adjourn the special meeting, if necessary, requires the affirmative vote of holders of at least 51%a majority of the shares of Delavan common stockSTC entitled to vote, present in person or by proxy, if a quorum is present. In the absence of a quorum, the holders of at least 51%a majority of the shares of Delavan common stockSTC present in person or by proxy may adjourn the special meeting. To satisfy the quorum requirements set forth in Delavan’sSTC’s by-laws, shareholders holding at least 51%a majority of the outstanding shares of Delavan common stockSTC entitled to vote on the matter at the special meeting must be present in person or by proxy for consideration of such matter at the special meeting. Shareholders may vote their shares in person at the special meeting or by signing and returning the enclosed proxy form.

On October 13, 2014, allJune 5, 2019, certain of Delavan’sSTC’s directors who own shares of DelavanSTC common stock committed to vote their shares of DelavanSTC common stock in favor of the merger and any other matter necessary for consummation of the transactions contemplated by the merger agreement. As of September 30, 2014,June 5, 2019, these shareholders and their affiliates owned 106,562205,787 shares, constituting approximately 28%46% of the shares then outstanding. See “The Merger—Voting agreement” on page 45.53.

DelavanSTC special meeting (See(See page 25)27)

The special meeting of shareholders will be held at       on      , 20152019 at      , local time. Delavan’sSTC’s board of directors is soliciting proxies for use at the special meeting. At the special meeting, DelavanSTC shareholders will

be asked to vote on proposals to adopt the merger agreement, to appoint Michael J. MurphyAnthony V. Sisto and any successors thereto to serve as the Shareholders’ Agentshareholders’ representative upon adoption of the merger agreement, including the appointment of James SaerKeith Kotche to serve as the Alternate Shareholders’ Agent,alternate shareholders’ representative, and to adjourn the special meeting, if necessary.

Record date for the special meeting; revocability of proxies (See(See pages 2527 and 26)28)

You may vote at the special meeting if you own shares of DelavanSTC common stock of record at the close of business on      , 2014.2019. You will have one vote for each share of DelavanSTC common stock you owned on that date. You may change your vote or revoke your proxy at any time before it is voted by filing with the secretary of DelavanSTC a duly executed revocation of proxy or submitting a new proxy form with a later date. You may also vote in person at the special meeting.

Completion of the merger is subject to regulatory approvals (See(See page 44)52)

The merger cannot be completed until Wintrust receives the necessary regulatory approval of each of the Board of Governors of the Federal Reserve System, or the Federal Reserve and the Wisconsin Department of Financial Institutions.Reserve. Wintrust submitted an application with each of the Federal Reserve Bank of Chicago and the Wisconsin Department of Financial Institutions on October 20, 2014.June 25, 2019.

Conditions to the merger (See(See page 55)65)

Closing Conditions for the Benefit of Wintrust. Wintrust’s obligations are subject to fulfillment of certain conditions, including:

 

·accuracy of representations and warranties of DelavanSTC in the merger agreement as of the closing date, except as otherwise set forth in the merger agreement;

 

·performance by DelavanSTC in all material respects of its agreements under the merger agreement;

 

·                  receipt of a certificate from a senior executive officer of STC certifying the accuracy of representations and warranties of STC as of the closing date, and a certificate from the secretary of STC certifying to the accuracy of the Company’s organizational documents and resolutions authorizing the merger agreement and incumbency matters;

·receipt of all necessary regulatory approvals;

 

·adoption of the merger agreement at the special meeting by the holders of at least a majority of the outstanding shares of DelavanSTC common stock entitled to vote;

 

·execution and delivery of articles of merger suitable for filing with the Wisconsin DepartmentSecretary of Financial Institutions DivisionState of Corporate & Consumer Services,the State of Illinois, which we refer to as the WDFI;
IL SOS;

 

·                  not greater than 5% of the outstanding shares of STC common stock constituting or being eligible to dissent;

·no threatened or pending litigation seeking to enjoin the transactions contemplated by the merger agreement or seeking other relief that Wintrust reasonably believes, subject to certain conditions, would make it inadvisable to consummate the merger or would have a material adverse effect on DelavanSTC or CommunitySTC Bank;

 

·                  no temporary restraining order, preliminary or permanent injunction or other order issued by a court of competent jurisdiction or other legal restraint or prohibition preventing the absenceconsummation of any environmental condition not previously disclosed to Wintrust related to certain real property owned by Delavan or its subsidiaries or in which Delavan or any of its subsidiaries has legal interest, as indicated or confirmed by the results of certain environmental surveys or reports, as set forth in the merger agreement (unless the aggregate merger consideration is reduced pursuant to the merger agreement);

merger;

·receipt of an opinion from Delavan’sSTC’s special counsel regarding the valid existence and the valid issuance of the capital stock of Delavan,STC, its authority to enter into the merger agreement and the due execution and delivery of the merger agreement by Delavan,STC, among other things;

 

·the capability of Michael J. Murphy to perform his duties under a previously executedentry into employment agreement with Community Bank as specified in the merger agreement;

or retention agreements by certain individuals;

 

·no material adverse change in DelavanSTC since October 13, 2014;

June 5, 2019, the date the merger agreement was signed;

 

·receipt of a consolidated balance sheetssheet of Delavan, Community Bank and its subsidiaries,STC, adjusted to reflect certain adjustments, specifications and charges, as set forth in the merger agreement;

 

·adjustment of the merger consideration, as applicable, as set forth in “—“Description of the Merger Agreement—Consideration to be received in the merger—Adjustment to Merger Consideration”;

 

receipt of title commitments and surveys with respect to parcels of real property owned and used by Community Bank;

·receipt of all other necessary consents, permissions and approvals, which the failure to obtain would have a “material adverse effect” with respect to DelavanSTC’s or Wintrust’s rights under the merger agreement; and

 

·the registration statement having been declared effective by the SEC and continuing to be effective as of the closing date.

date;

·                  approval of the listing of the shares of Wintrust common stock issuable pursuant to the merger agreement on Nasdaq; and

·                  the receipt of all other documents, certificates or instruments as may be requested evidencing STC’s compliance with the merger agreement.

Closing Conditions for the Benefit of DelavanSTC. Delavan’sSTC’s obligations are subject to fulfillment of certain conditions, including:

 

·accuracy of representations and warranties of Wintrust and Merger Co. in the merger agreement as of the closing date, except as otherwise set forth in the merger agreement;

 

·performance by Wintrust in all material respects of its agreements under the merger agreement;

 

·                  receipt of a certificate from a senior executive officer of Wintrust certifying the accuracy of representations and warranties of Wintrust, and a certificate from a senior executive officer of Merger Co. certifying to the accuracy of the Merger Co.’s organizational documents and resolutions authorizing the merger agreement and incumbency matters;

·receipt of all necessary regulatory approvals;

 

·execution and delivery of the articles of merger suitable for filing with the WDFI;

IL SOS;

 

·no threatenedtemporary restraining order, preliminary or pending litigation seeking to enjoinpermanent injunction or other order issued by a court of competent jurisdiction or other legal restraint or prohibition preventing the transactions contemplated byconsummation of the merger agreement or seeking other relief that Delavan reasonably believes, subject to certain conditions, would make it inadvisable to consummate the merger or would have a material adverse effect on Wintrust;

merger;

 

·receipt of an opinion from Wintrust’s special counsel regarding the valid existence of Wintrust and Merger Co., their authority to enter into the merger agreement and due execution and delivery of the merger agreement by Wintrust and Merger Co. and the issuances of shares of Wintrust common stock in the merger,, among other things;

 

·receipt of a tax opinion from Delavan’s accountantsSTC’s special counsel that the merger constitutes a “reorganization” within the meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended, which we refer to as the Code;

·no material adverse change in Wintrust since October 13, 2014;
June 5, 2019, the date the merger agreement was signed;

 

·the registration statement having been declared effective by the SEC and continuing to be effective as of the closing date; and

 

·approval of the listing of the shares of Wintrust common stock issuable pursuant to the merger agreement on NASDAQ.

Nasdaq;

·                  the execution and delivery of an assignment agreement by STC Bank, the litigation entity, Merger Co. and Wintrust relating to the assignment to the shareholders’ representative of all rights and obligations related to certain customer litigation; and

·                  the receipt of all other documents, certificates or instruments as may be requested evidencing Wintrust’s compliance with the merger agreement.

How the merger agreement may be terminated by Wintrust and DelavanSTC (See page 57)67)

By written agreement, Wintrust and DelavanSTC may mutually agree to terminate the merger agreement and abandon the merger at any time. Subject to conditions and circumstances described in the merger agreement, Wintrust or Delavan,STC, as the case may be, may also terminate the merger agreement as follows:

 

·by either party if the merger is not completed by JanuaryFebruary 29, 2020 (or May 31, 2015 (or March 31, 2015,2020, if the sole impediment to closing is a delay in the receipt of certain regulatory approvals)approval from the Federal Reserve);

 

·in certain circumstances, by either party in the event that a material breach or failure to perform any representation, warranty or covenant results in a failure of a closing condition and is not cured within a specified period of time, or if a condition to the merger has become impossible to satisfy;

 

·                  by either party if the merger agreement and the transactions contemplated therein are not approved by STC’s shareholders;

·in certain circumstances, by either party if DelavanSTC has accepted or consummatedentered into a definitive superior company proposal, from a third party;

in certain circumstances by Delavan if at the time the conditions to the merger are satisfied, the reference price is less than $36.50;

in certain circumstances by Wintrust if at the time the conditions to the merger are satisfied, the reference price is more than $52.50; or

in certain circumstances, by Wintrust upon the identification or confirmation of the presence of certain environmental conditions related to certain real property, as describeddefined below in “Description of the Merger Agreement—ConsiderationNo solicitation of or discussions relating to be receiveda company takeover proposal”, from a third party;

·                  in certain circumstances, by Wintrust, if STC’s board of directors adversely modifies its approval of the merger—Adjustmentmerger agreement, fails to recommend that STC’s shareholders vote for the merger agreement or fails to reaffirm such recommendation within 10 days of Wintrust’s request, or recommends an alternative company takeover proposal, as defined below in “Description of the Merger Consideration”.

Agreement—No solicitation of or discussions relating to a company takeover proposal”;

·                  in certain circumstances, by Wintrust, if a legal restraint, injunction or order prevents the enforcement of certain provisions relating to termination fees and exclusivity.

Termination fees and expenses may be payable under some circumstances (See page 58)67)

Generally, if the merger agreement is terminated by either DelavanSTC or Wintrust because the other party has committed a material breach, subject to certain limitations, the breaching party will be required to pay the non-breaching party a termination fee of $750,000$1,000,000, which includes out-of-pocket costs and reimburseexpenses.

If the non-breachingmerger agreement is terminated under certain circumstances as described in the merger agreement, including:

·                  the breach by STC of its agreement not to solicit alternative company takeover proposals and such breach cannot be cured within a certain time period;

·                  the entry by STC into a definitive agreement related to a superior company proposal;

·                  the adverse modification by STC’s board of its recommendation of shareholder approval of the merger agreement, failure to reaffirm such recommendation within 10 days of Wintrust’s request, or its recommendation of a competing company takeover proposal; or

·                  the termination of the merger agreement, after any person or entity makes a company takeover proposal that is publicly disclosed before the shareholders’ meeting, (a) by STC because the closing has not occurred by February 29, 2020 or such later date agreed to by the parties (or May 31, 2020, if the sole impediment to closing is due to delay in receiving regulatory approval from the Federal Reserve); (b) by Wintrust because STC has breached any of its representations, warranties, covenants, obligations or other agreements in the merger agreement such that a condition to closing is not satisfied and such breach cannot be cured within a certain time period, or because a condition to Wintrust’s obligations becomes impossible for STC to satisfy and, in each case, Wintrust has not waived such condition; (c) by either party because shareholder approval of the merger agreement was not obtained;

and in each case, STC consummates a company takeover proposal within 18 months of the termination, Wintrust may be owed a $2,000,000 termination fee from STC plus reimbursement for up to $250,000 in out-of-pocket costs and expenses.

 

Under certain circumstances described inIf the merger agreement including (i)is terminated in other circumstances due to failure to obtain shareholder approval of the breach by Delavan of itsmerger agreement, not to solicit alternative acquisition proposals or (ii) the entry into, consummation of or the Delavan board’s determination to accept, an unsolicited superior proposal from a third party, Wintrust may be owed a $1,250,000 termination fee from Delavan plus reimbursement for up to $250,000 in out-of-pocket costs and expenses. See “Description of the Merger Agreement—Termination fee.”

Voting agreement(See page 45)53)

On October 13, 2014, allJune 5, 2019, certain of the directors of DelavanSTC who own shares of DelavanSTC common stock agreed to vote all of their shares of DelavanSTC common stock in favor of the merger agreement and any other matter necessary for consummation of the transactions contemplated by the merger agreement. The voting agreement covers approximately 28%46% of Delavan’sSTC’s outstanding shares of common stock as of September 30, 2014.June 5, 2019. The voting agreement terminates if the merger agreement is terminated in accordance with its terms. A copy of the voting agreement is attached to this proxy statement/prospectus asAnnex C.

Accounting treatment of the merger

The merger will be accounted for as a purchase transaction in accordance with accounting principles generally accepted in the United States.

Certain differences in Wintrust shareholder rights and DelavanSTC shareholder rights(See page 62)71)

Wintrust is an Illinois corporation and Delavan is a Wisconsin corporation. Delavan shareholder rights under Wisconsin law and Wintrust shareholder rights under Illinois law are different. In addition,

Wintrust’s articles of incorporation and its by-laws contain provisions that are different from Delavan’sSTC’s articles of incorporation and by-laws as currently in effect. Certain of these differences are described in detail in the section entitled “Comparison of rights of Wintrust shareholders and DelavanSTC shareholders” beginning on page 62.71. After completion of the merger, DelavanSTC shareholders who receive shares of Wintrust common stock in exchange for their shares of DelavanSTC common stock will become Wintrust shareholders and their rights will be governed by Wintrust’s articles of incorporation and by-laws, in addition to laws and requirements that apply to public companies.

Wintrust shares will be listed on NASDAQNasdaq (See page 59)69)

The shares of Wintrust common stock to be issued pursuant to the merger will be listed on NASDAQNasdaq under the symbol “WTFC.”

Per Share Market Price and Dividend Information

Wintrust common stock is listed on NASDAQNasdaq under the symbol “WTFC.” The table below shows, for the quarters indicated, based on published financial sources, the reported high and low sales prices of Wintrust’s common stock during the periods indicated and the cash dividends paid per share of Wintrust common stock.

 

 

High

 

Low

 

Dividend

 

  High   Low   Dividend 

Year Ended December 31, 2012

      

Year Ended December 31, 2017

 

 

 

 

 

 

 

First Quarter

  $36.57    $28.61    $0.09  

 

$

76.71

 

$

65.29

 

$

0.14

 

Second Quarter

   36.85     31.67     —    

 

79.27

 

64.14

 

 

0.14

 

Third Quarter

   39.04     34.51     0.09  

 

80.52

 

67.74

 

 

0.14

 

Fourth Quarter

   39.81     34.40     —    

 

86.80

 

76.00

 

 

0.14

 

Year Ended December 31, 2013

      

Year Ended December 31, 2018

 

 

 

 

 

 

 

First Quarter

  $38.66    $35.90    $0.09  

 

$

91.67

 

$

76.70

 

$

0.19

 

Second Quarter

   38.70     34.63     —    

 

99.96

 

83.47

 

 

0.19

 

Third Quarter

   42.28     38.38     0.09  

 

92.56

 

84.61

 

 

0.19

 

Fourth Quarter

   47.80     40.61     —    

 

88.81

 

61.53

 

 

0.19

 

Year Ending December 31, 2014

      

Year Ending December 31, 2019

 

 

 

 

 

 

 

First Quarter

  $49.99    $42.14    $0.10  

 

$

75.98

 

$

63.97

 

$

0.25

 

Second Quarter

   49.46     42.53     0.10  

 

78.25

 

67.45

 

0.25

 

Third Quarter

   48.53     44.34     0.10  

Fourth Quarter (through November 25, 2014)

   47.13     41.99     0.10  

 

Comparative Per Share Data

The following table presents selected comparative per share data for Wintrust common stock and DelavanSTC common stock. You should read this information in conjunction with the selected historical financial information included elsewhere in this proxy statement/prospectus, and the historical financial statements of Wintrust and related notes that are incorporated by reference in this proxy statement/prospectus by reference. The historical per share data is derived from Wintrust’s and STC’s audited financial statements as of and for the year ended December 31, 20132018 and Wintrust’s and Delavan’sSTC’s unaudited interim financial statements as of and for the ninethree months ended September 30, 2014.March 31, 2019.

 

  Nine Months Ended
September 30, 2014
   Year Ended
December 31, 2013
 

 

Three Months
Ended
March 31, 2019

 

Year Ended
December 31,
2018

 

Wintrust:

    

 

 

 

 

 

Diluted earnings per share

  $2.23    $2.75  

 

$

1.52

 

$

5.86

 

Cash dividends declared per share

   0.30     0.18  

 

$

0.25

 

$

0.76

 

Book value per share (at period end)

   40.74     38.47  

 

$

57.33

 

$

55.71

 

Delavan:

    

STC:

 

 

 

 

 

Diluted earnings per share

  $3.10    $2.65  

 

$

0.97

 

$

4.90

 

Cash dividends declared per share

   0.00     0.00  

 

 

$

2.24

 

Book value per share (at period end)

   72.03     68.85  

 

$

70.56

 

$

68.88

 

 

Selected Historical Financial Data of Wintrust

The selected consolidated financial data of Wintrust presented below is being provided to assist you in your analysis of the financial aspects of the merger. The annual Wintrust historical information as of and for each of the years in the five-year period ended December 31, 2013,2018, are derived from Wintrust’s audited historical financial statements. The selected consolidated financial data presented below, as of and for the nine-monththree-month periods ended September 30, 2014March 31, 2019 and 2013,2018, are derived from Wintrust’s unaudited interim consolidated financial statements. This information is only a summary and should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the consolidated financial statements and the notes thereto incorporated by reference into this proxy statement/prospectus from Wintrust’s Annual Report on Form 10-K for the fiscal year ended December 31, 2013,2018, and Wintrust’s Quarterly Report on Form 10-Q for the period ended September 30, 2014. March 31, 2019.

The historical results below or contained elsewhere in this proxy statement/prospectus are not necessarily indicative of the future performance of Wintrust or the combinedsurviving company.

 

  Nine Months Ended
September 30,
 Years Ended December 31, 
  2014 2013 2013 2012 2011 2010 2009 

 

Three Months Ended
March 31,

 

Years Ended December 31,

 

  (Dollars in thousands, except per share data) 

 

2019

 

2018

 

2018

 

2017

 

2016

 

2015

 

2014

 

 

 

 

 

 

(Dollars in thousands, except per share data)

 

Selected Financial Condition Data (at end of period):

        

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total assets

  $19,169,345   $17,682,548   $18,097,783   $17,519,613   $15,893,808   $13,980,156   $12,215,620  

 

32,358,621

 

28,456,772

 

31,244,849

 

27,915,970

 

25,668,553

 

22,909,348

 

19,998,840

 

Total loans, excluding loans held-for-sale, covered loans

   14,052,059   12,581,039   12,896,602   11,828,943   10,521,377   9,599,886   8,411,771  

Total loans, excluding loans held-for-sale and covered loans

 

24,214,629

 

22,062,134

 

23,820,691

 

21,640,797

 

19,703,172

 

17,118,117

 

14,409,398

 

Total deposits

   16,065,246   14,647,446   14,668,789   14,428,544   12,307,267   10,803,673   9,917,074  

 

26,804,742

 

23,279,327

 

26,094,678

 

23,183,347

 

21,658,632

 

18,639,634

 

16,281,844

 

Junior subordinated debentures

   249,493   249,493   249,493   249,493   249,493   249,493   249,493  

 

253,566

 

253,566

 

253,566

 

253,566

 

253,566

 

268,566

 

249,493

 

Total shareholders’ equity

  $2,028,508   $1,873,566   $1,900,589   $1,804,705   $1,543,533   $1,436,549   $1,138,639  

 

3,371,972

 

3,031,250

 

3,267,570

 

2,976,939

 

2,695,617

 

2,352,274

 

2,069,822

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

 

Selected Statements of Income Data:

      

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income

   444,856   408,319   550,627   519,516   461,377   415,836   311,876  

 

261,986

 

225,082

 

964,903

 

832,076

 

722,193

 

641,529

 

598,575

 

Net revenue(1)

   602,439   584,355   773,024   745,608   651,075   607,996   629,523  

Net revenue(1)

 

343,643

 

310,761

 

1,321,053

 

1,151,582

 

1,047,623

 

913,126

 

813,815

 

Net income

 

89,146

 

81,981

 

343,166

 

257,682

 

206,875

 

156,749

 

151,398

 

Net income per common share — Basic

  $2.34   $2.51   $3.33   $2.81   $2.08   $1.08   $2.23  

 

1.54

 

1.42

 

5.95

 

4.53

 

3.83

 

3.05

 

3.12

 

Net income per common share — Diluted

  $2.23   $2.05   $2.75   $2.31   $1.67   $1.02   $2.18  

 

1.52

 

1.40

 

5.86

 

4.40

 

3.66

 

2.93

 

2.98

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

 

Selected Financial Ratios and Other Data:

        

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Performance Ratios:

      

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest margin(2)

   3.56 3.49 3.50 3.49 3.42 3.37 3.01

Net interest margin

 

3.70

%

3.54

%

3.59

%

3.41

%

3.24

%

3.34

%

3.51

%

Net interest margin - fully taxable equivalent (non-GAAP)(2)

 

3.72

 

3.56

 

3.61

 

3.44

 

3.26

 

3.36

 

3.53

 

Non-interest income to average assets

   1.14 1.36 1.27 1.37 1.27 1.42 2.78

 

1.06

 

1.25

 

1.23

 

1.21

 

1.34

 

1.29

 

1.15

 

Non-interest expense to average assets

   2.92 2.89 2.88 2.96 2.82 2.82 3.01

 

2.79

 

2.83

 

2.85

 

2.78

 

2.81

 

2.99

 

2.93

 

Net overhead ratio(2) (3)

   1.78 1.54 1.60 1.59 1.55 1.40 0.23

Efficiency ratio(2)(4)

   66.65 64.12 64.57 65.85 64.58 63.77 54.44

Net overhead ratio(3)

 

1.72

 

1.58

 

1.62

 

1.56

 

1.47

 

1.70

 

1.77

 

Return on average assets

   0.82 0.79 0.79 0.67 0.52 0.47 0.64

 

1.16

 

1.20

 

1.18

 

0.98

 

0.85

 

0.75

 

0.81

 

Return on average common equity

   7.86 7.57 7.56 6.60 5.12 3.01 6.70

 

11.09

 

11.29

 

11.26

 

9.26

 

8.37

 

7.15

 

7.77

 

Return on average tangible common equity(2)

   10.25 9.93 9.93 8.70 6.70 4.36 10.86

Return on average tangible common equity (non-GAAP)(2)

 

14.14

 

14.02

 

13.95

 

11.63

 

10.90

 

9.44

 

10.14

 

Average total assets

  $18,474,609   $17,344,319   $17,468,249   $16,529,617   $14,920,160   $13,556,612   $11,415,322  

 

$

31,216,171

 

$

27,809,597

 

$

29,028,420

 

$

26,369,702

 

$

24,292,231

 

$

20,999,837

 

$

18,685,341

 

Average total shareholders’ equity

  $1,947,425   $1,843,633   $1,856,706   $1,696,276   $1,484,720   $1,352,135   $1,081,792  

 

3,309,078

 

2,995,592

 

3,098,740

 

2,842,081

 

2,549,929

 

2,232,989

 

1,993,959

 

Average loans to average deposits ratio (excluding covered loans)

   90.0 88.9 88.9 87.8 88.3 91.1 90.5

 

92.7

 

95.2

 

93.7

%

92.7

%

90.9

%

89.9

%

88.0

%

Average loans to average deposits ratio (including covered loans)

   91.9 92.3 92.1 92.6 92.8 93.4 90.5

 

92.7

 

95.2

 

93.7

 

92.9

 

91.4

 

91.0

 

89.8

%

  

 

  

 

  

 

  

 

  

 

  

 

  

 

 

Common Share Data (at end of period):

        

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Market price per common share

  $44.67   $41.07   $46.12   $36.70   $28.05   $33.03   $30.79  

 

67.33

 

86.05

 

$

66.49

 

$

82.37

 

$

72.57

 

$

48.52

 

$

46.76

 

Book value per common share(2)

  $40.74   $38.09   $38.47   $37.78   $34.23   $32.73   $35.27  

Tangible common book value per share(2)

  $31.60   $29.89   $29.93   $29.28   $26.72   $25.80   $23.22  

Book value per common share

 

57.33

 

51.66

 

$

55.71

 

$

50.96

 

$

47.12

 

$

43.42

 

$

41.52

 

Tangible book value per common share (non-GAAP)(2)

 

46.38

 

42.17

 

$

44.73

 

$

41.68

 

$

37.08

 

$

33.17

 

$

32.45

 

Common shares outstanding

   46,691,047   39,731,043   46,116,583   36,858,355   35,978,349   34,864,068   24,206,819  

 

56,638,968

 

56,256,498

 

56,407,558

 

55,965,207

 

51,880,540

 

48,383,279

 

46,805,055

 

 

 

At March 31,

 

At December 31,

 

  At September 30, At December 31, 

 

2019

 

2018

 

2018

 

2017

 

2016

 

2015

 

2014

 

  2014 2013 2013 2012 2011 2010 2009 

 

 

 

 

 

(Dollars in thousands, except per share data)

 

  (Dollars in thousands, except per share data) 

Other Data at end of period:(7)

        

Other Data at end of period: (5)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Leverage Ratio

   10.0 10.5 10.5 10.0 9.4 10.1 9.3

 

9.1

%

9.3

%

9.1

%

9.3

%

8.9

%

9.1

%

10.2

%

Tier 1 capital to risk-weighted assets

   11.7 12.3 12.2 12.1 11.8 12.5 11.0

 

9.8

 

10.0

 

9.7

 

9.9

 

9.7

 

10.0

 

11.6

 

Common Equity Tier 1 capital to risk-weighted assets

 

9.3

 

9.5

 

9.3

 

9.4

 

8.6

 

8.4

 

N/A

 

Total capital to risk-weighted assets

   13.1 13.1 12.9 13.1 13.0 13.8 12.4

 

11.7

 

12.0

 

11.6

 

12.0

 

11.9

 

12.2

 

13.0

 

Tangible common equity ratio (TCE)(2)(6)

   7.9 7.9 7.8 7.4 7.5 8.0 4.7

Tangible common equity ratio, assuming full conversion of preferred stock(2)(6)

   8.6 8.7 8.5 8.4 7.8 8.3 7.1

Allowance for credit losses(5)

  $91,841   $108,455   $97,641   $121,988   $123,612   $118,037   $101,831  

Allowance for credit losses(4)

 

$

159,622

 

$

140,746

 

$

154,164

 

$

139,174

 

$

123,964

 

$

106,349

 

$

92,480

 

Non-performing loans

  $81,070   $123,261   $103,334   $118,083   $120,084   $141,958   $131,804  

 

117,586

 

89,690

 

113,234

 

90,162

 

87,454

 

84,057

 

78,677

 

Allowance for credit losses to total loans(5)

   0.65 0.86 0.76 1.03 1.17 1.23 1.21

Non-performing loans to total loans

   0.58 0.98 0.80 1.00 1.14 1.48 1.57

Allowance for credit losses(4) to total loans, excluding covered loans

 

0.66

%

0.64

%

0.65

%

0.64

%

0.63

%

0.62

%

0.64

%

Non-performing loans to total loans, excluding covered loans

 

0.49

 

0.41

 

0.48

 

0.42

 

0.44

 

0.49

 

0.55

 

Number of:

        

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Bank subsidiaries

   15   15   15   15   15   15   15  

 

15

 

15

 

15

 

15

 

15

 

15

 

15

 

Banking offices

   139   119   124   111   99   86   78  

 

170

 

157

 

167

 

157

 

155

 

152

 

140

 

  

 

  

 

  

 

  

 

  

 

  

 

  

 

 
        
  

 

  

 

  

 

  

 

  

 

  

 

  

 

 

 

(1)Net revenue is net interest income plus non-interest income.
(2)See Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Non-GAAP Financial Measures/Ratios” of Wintrust’s 2013 Form 10-K for a reconciliation of this performance measure/ratio to GAAP.
(3)The net overhead ratio is calculated by netting total non-interest expense and total non-interest income, annualizing this amount, and dividing by that period’s total average assets. A lower ratio indicates a higher degree of efficiency.
(4)The efficiency ratio is calculated by dividing total non-interest expense by tax-equivalent net revenue (less securities gains or losses). A lower ratio indicates more efficient revenue generation.
(5)The allowance for credit losses includes both the allowance for loan losses and the allowance for unfunded lending-related commitments, but excludes the allowance for covered loan losses.
(6)Total shareholders’ equity minus preferred stock and total intangible assets divided by total assets minus total intangible assets.
(7)Asset quality ratios exclude covered loans.

(1) Net revenue includes net interest income and non-interest income.

(2) See Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Non-GAAP Financial Measures/Ratios,” for a reconciliation of this performance measure/ratio to GAAP.

(3) The net overhead ratio is calculated by netting total non-interest expense and total non-interest income, annualizing this amount, and dividing by that period’s total average assets. A lower ratio indicates a higher degree of efficiency.

(4) The allowance for credit losses includes both the allowance for loan losses and the allowance for unfunded lending-related commitments, but excludes the allowance for covered loan losses.

(5) Asset quality ratios exclude covered loans.

Selected Historical Financial Data of DelavanSTC

The selected consolidated financial data of DelavanSTC presented below is being provided to assist you in your analysis of the financial aspects of the merger. The annual STC historical information as of and for each of the years in the five-year period ended December 31, 2018, are derived from STC’s audited historical financial statements.  The selected consolidated financial data presented below, as of and for the nine-monththree-month periods ended September 30, 2014March 31, 2019 and 2013,2018, are derived from Delavan’sSTC’s unaudited consolidated financial statements prepared in the ordinary course of Delavan’sSTC’s business and do not include notes or year-end adjustments. The historical results below or contained elsewhere in this proxy statement/prospectus are not necessarily indicative of the future performance of DelavanSTC or the combinedsurviving company.

 

  Nine Months Ended
September 30,
 Years Ended December 31, 

 

Three Months Ended
March 31,

 

Years Ended December 31,

 

  2014 2013 2013 2012 2011 2010 2009 

 

2019

 

2018

 

2018

 

2017

 

2016

 

2015

 

2014

 

        (Dollar in thousands, except per share data) 

 

 

 

 

 

(Dollar in thousands, except per share data)

 

Selected Financial Condition Data (at end of period)

        

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Delavan Bancshares, Inc

        

STC Bancshares Corp.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total loans, excluding loans held for sale

  $138,798   $137,783   $138,138   $155,539   $163,710   $179,740   $190,571  

 

$

203,959

 

$

214,830

 

$

213,346

 

$

219,171

 

$

196,265

 

$

155,515

 

$

140,194

 

Total deposits

  $166,823   $167,329   $165,954   $175,337   $195,044   $198,493   $218,706  

 

243,923

 

233,395

 

245,239

 

247,578

 

216,671

 

194,004

 

163,662

 

Total shareholders’ equity

  $26,940   $25,468   $25,748   $26,264   $25,058   $24,497   $19,551  

 

31,611

 

29,563

 

30,718

 

29,551

 

27,576

 

25,970

 

24,888

 

Selected Statements of Income Data

        

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Delavan Bancshares, Inc

        

Net Interest Income

  $5,782   $5,418   $8,004   $8,383   $8,697   $8,324   $7,980  

STC Bancshares Corp.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income

 

2,515

 

2,505

 

10,275

 

10,181

 

8,827

 

7,420

 

6,760

 

Net revenue

  $6,754   $6,463   $9,354   $9,852   $9,952   $9,141   $9,314  

 

2,745

 

2,855

 

11,870

 

11,399

 

10,592

 

8,759

 

8,069

 

Net income per share

  $3.16   $1.92   $2.69   $0.93   $0.36   $2.46   $4.81  

 

1.13

 

0.98

 

5.71

 

5.99

 

5.45

 

3.64

 

2.82

 

Delavan Bancshares, Inc

        

STC Bancshares Corp.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common Share Data

        

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Book value per common share

  $72.03   $68.06   $68.85   $67.23   $66.65   $65.34   $70.53  

 

70.56

 

66.29

 

68.88

 

66.26

 

61.83

 

59.56

 

57.08

 

Common Shares outstanding

   373,989   374,239   373,989   375,739   375,978   374,878   277,175  

Selected Financial Ratios of Community Bank CBD

        

Net Interest Margin

   4.33 4.43 4.42 4.24 4.05 3.70 3.43

Common shares outstanding

 

448,000

 

446,000

 

446,000

 

446,000

 

446,000

 

436,000

 

436,000

 

Selected Financial Ratios of STC Bank

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest margin

 

4.02

%

3.98

%

4.04

%

4.12

%

4.16

%

4.15

%

4.24

%

Non-interest income to average assets

   0.59 0.59 0.59 0.54 (0.29)%  0.50 0.51

 

0.29

 

0.46

 

0.56

 

0.45

 

0.76

 

0.48

 

0.68

 

Non-interest expense to average assets

   3.00 2.96 2.89 2.50 2.50 2.44 2.31

 

3.28

 

3.53

 

3.45

 

3.17

 

3.22

 

3.38

 

3.60

 

Return on average assets

   0.77 0.46 0.51 0.14 0.09 0.40 0.22

 

0.80

 

0.70

 

0.97

 

1.04

 

1.08

 

0.80

 

0.70

 

Return on average common equity

   5.94 3.75 4.08 1.18 0.81 4.54 2.50

 

7.29

 

6.69

 

9.34

 

10.13

 

9.79

 

6.60

 

5.49

 

Average total assets

  $207,081   $212,602   $211,565   $229,304   $245,501   $256,748   $260,165  

 

$

267,542

 

$

268,847

 

$

269,225

 

$

261,957

 

$

227,472

 

$

197,665

 

$

180,237

 

Average Common Equity

  $26,857   $26,201   $26,208   $26,527   $26,710   $22,612   $22,182  

Selected Other Data of Community Bank CBD

        

Leverage Ratio

   12.75 11.86 12.08 10.94 10.02 10.08 8.12

Tier 1 Capital to risk-weighted assets

   17.95 16.77 17.23 15.55 13.92 13.37 10.51

Average common equity

 

29,536

 

27,993

 

27,975

 

26,808

 

25,188

 

24,032

 

22,907

 

Selected Other Data of STC Bank

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Leverage ratio

 

11.29

%

10.61

%

10.67

%

10.51

%

10.89

%

11.72

%

12.44

%

Tier 1 capital to risk-weighted assets

 

14.03

 

12.02

 

12.92

 

11.55

 

11.96

 

14.23

 

15.85

 

Total capital to risk-weighted assets

   19.21 17.96 18.48 16.82 15.17 14.64 11.77

 

15.23

 

13.16

 

14.04

 

12.66

 

13.04

 

15.28

 

17.10

 

Allowance for credit losses

  $2,267   $1,750   $2,024   $4,811   $2,493   $4,181   $3,488  

 

$

2,585

 

$

2,708

 

$

2,577

 

$

2,701

 

$

2,367

 

$

1,827

 

$

1,876

 

Non performing loans

  $1,590   $857   $1,208   $3,705   $1,999   $2,166   $4,582  

Non-performing loans

 

3,337

 

100

 

3,576

 

100

 

565

 

 

387

 

Allowance for credit losses to total loans

   1.59 1.27 1.42 3.07 1.52 2.29 1.82

 

1.26

%

1.26

%

1.20

%

1.23

%

1.20

%

1.15

%

1.34

%

Non-performing loan to total loans

   1.12 0.62 0.85 2.36 1.22 1.19 2.39

 

1.63

 

0.05

 

1.66

 

0.05

 

0.29

 

 

0.28

 

RISK FACTORS

 

RISK FACTORS

In addition to the other information contained in or incorporated by reference into this proxy statement/prospectus, including the matters addressed under the caption “Special Notes Concerning Forward-Looking Statements” on page 22,24, you should consider the following risk factors carefully in deciding whether to vote for the adoption of the merger agreement. Additional risks and uncertainties not presently known to Wintrust and DelavanSTC or that are not currently believed by Wintrust or STC to be important to you, if they materialize, also may adversely affect the merger and Wintrust, STC and Delavan as a combinedthe surviving company.

In addition, Wintrust’s and Delavan’sSTC’s respective businesses are subject to numerous risks and uncertainties, including the risks and uncertainties described, in the case of Wintrust, in its Annual Report on Form 10-K for the year ended December 31, 2013,2018, which is incorporated by reference into this proxy statement/prospectus.

Risks relating to the merger

Because the market price of Wintrust common stock may fluctuate, you cannot be certain of the precise value of the stock portion of the merger consideration you may receive in the merger.

At the time the merger is completed, each issued and outstanding share of DelavanSTC common stock (other than shares held as treasury stock or otherwise owned by DelavanSTC or CommunitySTC Bank and shares of DelavanSTC common stock in respect of which dissenters’ rights have been properly exercised and perfected) will be converted into the right to receive consideration in the form of Wintrust common stock and cash, subject to adjustment. The exchange ratio for the Wintrust common stock, as calculated in accordance with the formula set forth in the merger agreement, may fluctuate depending on the market price of Wintrust common stock during the reference period.

There will be a time lapse between each of the date on which DelavanSTC shareholders vote to approve the merger and adopt the merger agreement at the special meeting, the date on which the exchange ratio is determined and the date on which DelavanSTC shareholders entitled to receive shares of Wintrust common stock actually receive such shares. The market value of Wintrust common stock may fluctuate during these periods. Consequently, at the time DelavanSTC shareholders must decide whether to approve the merger and the merger agreement, they will not know the actual market value of the shares of Wintrust common stock they will receive when the merger is completed. The actual value of the shares of Wintrust common stock received by the DelavanSTC shareholders will depend on the market value of shares of Wintrust common stock on that date. This market value may be less than the value used to determine the exchange ratio, as that determination will be made with respect to a period occurring prior to the consummation of the merger.

Because the merger consideration is subject to downward adjustment, the value of the merger consideration you may receive in the merger may be less than you expect.

The merger consideration to be received by DelavanSTC shareholders at the closing of the merger is subject to downward adjustment by Wintrust and DelavanSTC if the balance sheet delivered to Wintrust by DelavanSTC as of the closing date reflects that Delavan’sSTC’s shareholders’ equity, as determined pursuant to the merger agreement and subject to certain exclusions described therein, is less than $26,000,000, or$30,700,000 plus the amount of proceeds credited from the exercise of outstanding options. Any adjustment will be made to account for certain environmental conditions that may be discovered in the real propertycash portion of Delavan or its subsidiaries.the merger consideration. For a description of the possible adjustment of the merger consideration, see “Description of the Merger Agreement—Consideration to be received in the merger—Adjustment to Merger Consideration” on page 50.58.

Up to $2.9 million of the aggregate shareholder cash consideration may be held in escrow and may not be distributed to the STC shareholders following the merger.

At the effective time of the merger, Wintrust will pay $2,500,000 to the escrow agent, to be held for up to 15 months following the closing, for purposes of funding STC’s indemnification obligations and supplementing the reserve amount by up to $500,000. Wintrust will also deposit $400,000 with the escrow agent, to be held until certain customer litigation has been resolved, concluded, settled or decided not to pursue further, but not more than five years from the commencement of the customer litigation, for the purposes of funding the shareholders’

indemnification of the shareholders’ representative and the expenses associated with the resolution of certain customer litigation. The escrowed funds may not be paid, or be only partially paid, to STC shareholders if Wintrust or the shareholders’ representative suffers or incurs any losses or expenses in connection with such indemnification obligations or customer litigation, as the case may be. A claim against the escrowed funds may reduce the aggregate shareholder cash consideration to be distributed to the STC shareholders in connection with the merger. Any amounts received by the litigation entity may increase the reserve amount to be distributed to the STC shareholders.  For further information on the escrow holdback, see “Description of the Merger Agreement—Consideration to be received in the merger—Escrow Holdback” on page 59.

Upon adoption of the merger agreement, the Shareholders’ Agentshareholders’ representative will have the ability to take actions in connection with the merger, and the merger agreement, the escrow agreement, the reserve agreement and certain customer litigation on behalf of the DelavanSTC shareholders without further notice to or approval by the DelavanSTC shareholders.

In connection with the adoption of the merger agreement and approval of the merger by the DelavanSTC shareholders, if approved at the special meeting by the requisite vote of the DelavanSTC shareholders, Michael J. MurphyAnthony V. Sisto and any successors thereto will be appointed as the DelavanSTC shareholders’ agentrepresentative and attorney-in-fact,

including the appointment of James SaerKeith Kotche as the Alternate Shareholders’ Agent,alternate shareholders’ representative, with respect to any actions specified or contemplated by the merger agreement.agreement, the escrow agreement or the reserve agreement (including as manager of the litigation entity). The appointment of the Shareholders’ Agentshareholders’ representative and the Alternate Shareholders’ Agentalternate shareholders’ representative will constitute the authorization by each holder of DelavanSTC common stock, even if a DelavanSTC shareholder did not vote to approve the merger and therebyor vote to appoint the Shareholders’ Agentshareholders’ representative and the Alternate Shareholders’ Agent.alternate shareholders’ representative. The Shareholders’ Agent,shareholders’ representative, and if applicable the Alternate Shareholders’ Agent,alternate shareholders’ representative, may take action or decline to do so as such individual may determine in his or her sole discretion without any notice to or approval by the DelavanSTC shareholders, and will be indemnified by the DelavanSTC shareholders in taking or declining such action.

Because there is no public market for the DelavanSTC common stock, it is difficult to determine how the fair value of DelavanSTC common stock compares with the merger consideration.

The outstanding shares of DelavanSTC common stock are privately held and are not traded in any public market. This lack of a public market makes it difficult to determine the fair value of Delavan.STC. Because the merger consideration was determined based on negotiations between the parties, it may not be indicative of the fair value of the shares of DelavanSTC common stock.

The financial forecasts reflected in Baird’sD.A. Davidson’s fairness opinion, which is summarized beginning on page 30,34, involve risks, uncertainties and assumptions made by Baird,D.A. Davidson, many of which are beyond the control of Wintrust and Delavan.STC. As a result, they may not prove to be accurate and are not necessarily indicative of current values or future performance of either Wintrust or Delavan.STC.

The financial forecasts of BairdD.A. Davidson reflected in its fairness opinion, a copy of which is attached to this proxy statement asAnnex D, and which is summarized beginning on page 30,34, involve risks, uncertainties and assumptions made by BairdD.A. Davidson and are not a guarantee of future performance. The future financial results of Wintrust and DelavanSTC and, if the merger is completed, the combinedsurviving company, may materially differ from those expressed in the financial forecasts of BairdD.A. Davidson due to factors that are beyond Wintrust’s and Delavan’sSTC’s ability to control or predict. Neither Wintrust nor DelavanSTC can provide any assurance that these financial forecasts will be realized or that Wintrust’s or Delavan’sSTC’s future financial results will not materially vary from such financial forecasts. Wintrust did not provide its own financial forecasts, and the management of Wintrust did not confirm or otherwise comment with respect to any estimates used by or the financial forecasts of Baird,D.A. Davidson, nor do Wintrust or DelavanSTC undertake to update the forecasts reflected in Baird’sD.A. Davidson’s fairness opinion. Such financial forecasts cover multiple years, and the information by its nature becomes subject to greater uncertainty with each successive year. These financial forecasts do not take into account any circumstances or events occurring after the date they were prepared.

More specifically, the financial forecasts of Baird:D.A. Davidson:

·necessarily makecontain numerous assumptions by Baird,D.A. Davidson, many of which are beyond the control of Wintrust or DelavanSTC and may not prove to be accurate;

 

·do not necessarily reflect revised prospects for Wintrust’s or Delavan’sSTC’s businesses, changes in general business or economic conditions, or any other transaction or event that has occurred or that may occur and that was not anticipated at the time the forecasts were prepared;

 

·are not necessarily indicative of current values or future performance, which may be significantly more favorable or less favorable than is reflected in the forecasts; and

 

·should not be regarded as a representation that the financial forecasts will be achieved.

The financial forecasts reflected in Baird’sD.A. Davidson’s fairness opinion were not prepared with a view toward public disclosure or compliance with published guidelines of the SEC or the American Institute of Certified Public Accountants for preparation and presentation of prospective financial information or generally accepted accounting principles, which we refer to as GAAP, and do not reflect the effect of any proposed or other changes in GAAP that may be made in the future.

Wintrust may be unable to successfully integrate Delavan’sSTC’s and CommunitySTC Bank’s operations and may not realize the anticipated benefits of acquiring Delavan.STC.

Wintrust and DelavanSTC entered into the merger agreement with the expectation that Wintrust would be able to successfully integrate Delavan’sSTC’s and CommunitySTC Bank’s operations and that the merger would result in various benefits, including, among other things, enhanced revenues and revenue synergies, an expanded market reach and operating efficiencies. Achieving the anticipated benefits of the merger is subject to a number of uncertainties, including whether Wintrust integrates and operates DelavanSTC and CommunitySTC Bank in an efficient and effective manner, and general competitive factors in the market place.marketplace. The process of integrating operations could cause an interruption of, or loss of momentum in, the activities of one or more of the combinedsurviving company’s businesses or the loss of key personnel. The diversion of management’s attention and any delays or difficulties encountered in connection with the merger and the integration of the two companies’ operations could have an adverse effect on the business, financial condition, operating results and prospects of the combinedsurviving company after the merger. Failure to achieve these anticipated benefits could result in increased costs, decreases in the amount of expected revenues and diversion of management’s time and energy and could have an adverse effect on the combinedsurviving company’s business, financial condition, operating results and prospects.

Among the factors considered by the boards of directors of Wintrust and DelavanSTC in connection with their respective approvals of the merger agreement were the benefits that could result from the merger. We cannot give any assurance that these benefits will be realized within the time periods contemplated or even that they will be realized at all.

DelavanSTC will be subject to business uncertainties while the merger is pending, which could adversely affect its business.

Uncertainty about the effect of the merger on employees and customers may have an adverse effect on Delavan,STC, and, consequently, the combinedsurviving company. Although DelavanSTC intends to take steps to reduce any adverse effects, these uncertainties may impair Delavan’sSTC’s ability to attract, retain and motivate key personnel until the merger is consummated and for a period of time thereafter, and could cause customers and others that deal with DelavanSTC to seek to change their existing business relationships with Delavan.STC. Employee retention at DelavanSTC may be particularly challenging during the pendency of the merger, as employees may experience uncertainty about their roles with the combinedsurviving company following the merger.

Termination of the merger agreement could negatively impact STC.

If the merger is not completed for any reason, including as a result of STC’s shareholders declining to approve the merger, the ongoing business of STC may be adversely impacted and, without realizing any of the anticipated benefits of completing the merger, STC would be subject to a number of risks, including the following:

·                  STC may experience negative reactions from its customers, vendors and employees;

·                  STC will have incurred substantial expenses and will be required to pay certain costs relating to the merger, whether or not the merger is completed;

·                  The merger agreement places certain restrictions on the conduct of STC’s business prior to the completion of the merger.  Such restrictions, the waiver of which is subject to the consent of Wintrust (not to be unreasonably withheld, delayed or conditioned), may prevent STC from making certain acquisitions or taking certain other specified actions during the pendency of the merger (see “Description of the Merger Agreement—Conduct of business pending the merger and certain covenants” beginning on page 61 of this proxy statement/prospectus for a description of the restrictive covenants applicable to STC); and

·                  Matters relating to the merger (including integration planning) will require substantial commitments of time and resources by STC management, which would otherwise have been devoted to other opportunities that may have been beneficial to STC as an independent company.

Regulatory approvals may not be received, may take longer than expected or may impose conditions that are not presently anticipated or cannot be met.

Before the transactions contemplated in the merger agreement can be completed, various approvals must be obtained from the bank regulatory.  In deciding whether to grant these approvals, the relevant governmental entities will consider a variety of factors, including the regulatory standing of each of the parties and the effect of the merger on competition.  An adverse development in either party’s regulatory standing or other factors could result in an inability to obtain one or more of the required regulatory approvals or delay receipt of required approvals.

The terms of the approvals that are granted may impose conditions, limitations, obligations or costs, or place restrictions on the conduct of the surviving company’s business or require changes to the terms of the transactions contemplated by the merger agreement. There can be no assurance that regulators will not impose any such conditions, limitations, obligations or restrictions and that such conditions, limitations, obligations or restrictions will not have the effect of delaying the completion of any of the transactions contemplated by the merger agreement, imposing additional material costs on or materially limiting the revenues of the surviving company following the merger or otherwise reduce the anticipated benefits of the merger if the merger were consummated successfully within the expected timeframe. Nor can there be any assurance that any such conditions, terms, obligations or restrictions will not result in the delay or abandonment of the merger. Additionally, the completion of the merger is conditioned on the absence ofcertain orders or injunctions issued by any court of competent jurisdiction or other legal restraints that would prohibit or make illegal the consummation of any of the transactions contemplated by the merger agreement.

Wintrust and STC believe that the proposed transactions should not raise significant regulatory concerns and that the parties will be able to obtain all requisite regulatory approvals in a timely manner. Wintrust will take all other appropriate actions necessary to obtain the regulatory approvals, and STC and STC Capital Bank will use all reasonable and diligent efforts to assist in obtaining all such approvals.  The obligation of Wintrust to take all appropriate actions will not be construed as including an obligation to accept any terms of or conditions to a consent, authorization, order, or approval of, or any exemption by, any governmental authority or other party that are not acceptable to Wintrust, in its sole reasonable discretion, or to change the business practices of Wintrust or any of its subsidiaries in a manner not acceptable to Wintrust, in its sole reasonable discretion.

Some of the directors and executive officers of Delavan, CommunitySTC, STC Bank and its subsidiariessubsidiary have interests and arrangements that could have affected their respective decision to support or approve the merger.

The interests of some of the directors and executive officers of Delavan, CommunitySTC, STC Bank and its subsidiariessubsidiary in the merger are different from, and may be in addition to, those of DelavanSTC shareholders generally and could have affected their decision to support or approve the merger. These interests include:

 

·the entry into an employment agreement with Michael J. MurphyChristopher Woelffer  in connection with the merger, which provides formerger;

·                                          the payment of severance under certain circumstances;

entry into a retention agreement with Jodi Ariss;

 

·Wintrust’s agreement to provide officers and directors of DelavanSTC with continuing indemnification rights; and

 

·Wintrust’s agreement to provide directors’ and officers’ insurance to the officers and directors of Delavan,STC, subject to limits on availability and cost, for up to six years following the merger.

In addition, all

Certain of the directors of DelavanSTC who own shares of DelavanSTC common stock have entered into a voting agreement that requires them to vote all of their shares of DelavanSTC common stock at the special meeting in favor of the merger agreement and any other matter necessary for consummation of the transactions contemplated by the merger agreement. The voting agreement covers approximately 28%46% of Delavan’sSTC’s outstanding shares of common stock as of September 30, 2014.

June 5, 2019. In addition, Eduardo E. Greco, a director of STC, and certain of his affiliates are parties to loan transactions with certain bank subsidiaries of Wintrust.

As a result, the directors of DelavanSTC may be more likely to recommend to Delavan’sSTC’s shareholders the adoption of the merger agreement than if they did not have these interests.

Risks relating to the businesses of Wintrust and the combinedsurviving company

Delavan’sSTC’s shareholders will not control Wintrust’s future operations.

Currently, Delavan’sSTC’s shareholders own 100% of DelavanSTC and have the power to approve or reject any matters requiring shareholder approval under WisconsinIllinois law and Delavan’sSTC’s articles of incorporation and by-laws. After the merger, DelavanSTC shareholders are expected to become owners of approximatelyless than 1% of the outstanding shares of Wintrust common stock. Even if all former DelavanSTC shareholders voted together on all matters presented to Wintrust’s shareholders, from time to time, the former DelavanSTC shareholders most likely would not have a significant impact on the approval or rejection of future Wintrust proposals submitted to a shareholder vote.

The market price of Wintrust common stock after the merger may be affected by factors different from those currently affecting the price of STC common stock.

Upon completion of the merger, holders of STC common stock will become holders of Wintrust common stock. The results of operations of Wintrust will be affected by some factors that are different from those currently affecting the results of operations of STC. For example, Wintrust operates in Canada and certain states of the United States, including Wisconsin and Indiana, where STC does not have significant operations. Accordingly, the results of operations of Wintrust will be affected by business and other developments in those areas to a larger extent than those of STC.

SPECIAL NOTES CONCERNING FORWARD-LOOKING STATEMENTS

This document contains, and the documents into which it may be incorporated by reference may contain, forward-looking statements within the meaning of federal securities laws. Forward-looking information can be identified through the use of words such as “intend,” “plan,” “project,” “expect,” “anticipate,” “believe,” “estimate,” “contemplate,” “possible,” “point,” “will,” “may,” “should,” “would” and “could.” Forward-looking statements and information are not historical facts, are premised on many factors and assumptions, and represent only management’s expectations, estimates and projections regarding future events. Similarly, these statements are not guarantees of future performance and involve certain risks and uncertainties that are difficult to predict, which may include, but are not limited to, those listed below and the Risk Factors discussed under Item 1A of Wintrust’s 20132018 Annual Report on Form 10-K and, as well as other risks and uncertainties set forth from time to time in any of Wintrust’s subsequent SEC filings.other filings with the SEC. Wintrust intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and is including this statement for purposes of invoking these safe harbor provisions. Such forward-looking statements may be deemed to include, among other things, statements relating to Wintrust’s future financial performance, the performance of its loan portfolio, the expected amount of future credit reserves and charge-offs, delinquency trends, growth plans, regulatory developments, securities that Wintrust may offer from time to time, and management’s long-term performance goals, as well as statements relating to the anticipated effects on financial condition and results of operations from expected developments or events, Wintrust’s business and growth strategies, including future acquisitions of banks, specialty finance or wealth management businesses, internal growth and plans to form additional de novo banks or branch offices. Actual results could differ materially from those addressed in the forward-looking statements as a result of numerous factors, including the following:

 

negative

·                                          economic conditions that adversely affect the economy, housing prices, the job market and other factors that may adversely affect Wintrust’s liquidity and the performance of its loan portfolios, particularly in the markets in which it operates;

 

·                                          negative effects suffered by Wintrust or its customers resulting from changes in U.S. trade policies;

·the extent of defaults and losses on Wintrust’s loan portfolio, which may require further increases in its allowance for credit losses;

 

·estimates of fair value of certain of Wintrust’s assets and liabilities, which could change in value significantly from period to period;

 

·the financial success and economic viability of the borrowers of Wintrust’s commercial loans;

 

·                                          commercial real estate market conditions in the commercial real-estate market in the Chicago metropolitan andarea, southern Wisconsin areas;

and northwest Indiana;

 

·the extent of commercial and consumer delinquencies and declines in real estate values, which may require further increases in Wintrust’s allowance for loan and lease losses;

 

·inaccurate assumptions in Wintrust’s analytical and forecasting models used to manage its loan portfolio;

 

·changes in the level and volatility of interest rates, the capital markets and other market indices that may affect, among other things, Wintrust’s liquidity and the value of its assets and liabilities;

 

·competitive pressures in the financial services business which may affect the pricing of Wintrust’s loan and deposit products as well as its services (including wealth management services);

, which may result in loss of market share and reduced income from deposits, loans, advisory fees and income from other products;

·failure to identify and complete favorable acquisitions in the future or unexpected difficulties or developments related to the integration of Wintrust’s recent or future acquisitions, including the acquisition of DelavanSTC pursuant to the merger agreement;

 

·unexpected difficulties and losses related to FDIC-assisted acquisitions, including those resulting fromacquisitions;

·                                          harm to Wintrust’s loss-sharing arrangements with the FDIC;

reputation;

·any negative perception of Wintrust’s reputation or financial strength;

 

·ability of Wintrust to raise additional capital on acceptable terms when needed;

 

·disruption in capital markets, which may lower fair values for Wintrust’s investment portfolio;

 

·ability of Wintrust to use technology to provide products and services that will satisfy customer demands and create efficiencies in operations;

operations and to manage risks associated therewith;

 

·                                          failure or breaches of Wintrust’s security systems or infrastructure, or those of third parties;

·                                          security breaches, including denial of service attacks, hacking, social engineering attacks, malware intrusion or data corruption attempts and identity theft;

·adverse effects on Wintrust’s information technology systems resulting from failures, human error or tampering;

cyberattacks;

 

·adverse effects of failures by Wintrust’s vendors to provide agreed upon services in the manner and at the cost agreed, particularly Wintrust’sits information technology vendors;

 

·increased costs as a result of protecting Wintrust’s customers from the impact of stolen debit card information;

 

·accuracy and completeness of information Wintrust receives about customers and counterparties to make credit decisions;

 

·the ability of Wintrust to attract and retain senior management experienced in the banking and financial services industries;

 

·environmental liability risk associated with lending activities;

 

·the impact of any claims or legal actions to which Wintrust is subject, including any effect on Wintrust’sits reputation;

 

·losses incurred in connection with repurchases and indemnification payments related to mortgages;

mortgages and increases in reserves associated therewith;

 

·the loss of customers as a result of technological changes allowing consumers to complete their financial transactions without the use of a bank;

 

·the soundness of other financial institutions;

 

·the expenses and delayed returns inherent in opening new branches and de novo banks;

 

·examinations and challenges by tax authorities;

authorities, and any unanticipated impact of the Tax Cuts and Jobs Act of 2017;

·changes in accounting standards, rules and interpretations, and the impact on Wintrust’s financial statements;

 

·the ability of Wintrust to receive dividends from its subsidiaries;

 

·                                          uncertainty about the future of LIBOR;

·a decrease in Wintrust’s regulatory capital ratios, including as a result of further declines in the value of its loan portfolios, or otherwise;

 

·legislative or regulatory changes, particularly changes in regulation of financial services companies and/or the products and services offered by financial services companies, including those resulting from the Dodd-Frank Act;

companies;

 

·a lowering of Wintrust’s credit rating;

 

·                                          changes in U.S. monetary policy and changes to the Federal Reserve’s balance sheet as a result of the end of its program of quantitative easing or otherwise;

·restrictions upon Wintrust’s ability to market its products to consumers and limitations on Wintrust’s ability to profitably operate its mortgage business resulting from the Dodd-Frank Act;

·increased costs of compliance, heightened regulatory capital requirements and other risks associated with changes in regulation and the current regulatory environment, including the Dodd-Frank Act;

environment;

 

·the impact of heightened capital requirements;

 

·increases in Wintrust’s FDIC insurance premiums, or the collection of special assessments by the FDIC;

 

·delinquencies or fraud with respect to Wintrust’s premium finance business;

 

·credit downgrades among commercial and life insurance providers that could negatively affect the value of collateral securing Wintrust’s premium finance loans;

 

·Wintrust’s ability to comply with covenants under its credit facility; and

 

·fluctuations in the stock market, which may have an adverse impact on Wintrust’s wealth management business and brokerage operation.

Therefore, there can be no assurances that future actual results will correspond to theseany forward-looking statements. The reader is cautioned not to place undue reliance on any forward-looking statement made by Wintrust. Forward-looking statements speak only as of the date they are made or as of such date that may be referenced within the statement, and Wintrust undertakes no obligation to update any forward-looking statement to reflect the impact of circumstances or events that arise after the date the forward-looking statement was made.made, except as required by law. Persons are advised, however, to consult further disclosures management makes on related subjects in its reports filed with the SEC and in its press releases.

INFORMATION ABOUT THE SPECIAL MEETING OF DELAVANSTC SHAREHOLDERS

Delavan

The STC board of directors is using this proxy statement/prospectus to solicit proxies from the holders of DelavanSTC common stock for use at the special meeting of Delavan’sSTC’s shareholders.

Date, time and place of the special meeting

The special meeting will be held at       on      , 20152019 at      , local time.

Purpose of the special meeting

At the special meeting, Delavanthe STC board of directors will ask you to vote upon the following:

 

·a proposal to adopt the merger agreement and thereby approve the merger;

 

·a proposal to appoint Michael J. MurphyAnthony V. Sisto and any successors thereto as the Shareholders’ Agentshareholders’ representative pursuant to the merger agreement, including the appointment of James SaerKeith Kotche as the Alternate Shareholders’ Agent,alternate shareholders’ representative, with respect to taking any and all actions upon the adoption of the merger agreement that are specified or contemplated by the merger agreement, the escrow agreement or the reserve agreement (including as manager of the litigation entity) on behalf of all DelavanSTC shareholders;

 

·a proposal to approve an adjournment of the special meeting to permit further solicitation in the event that an insufficient number of shares are present in person or by proxy to adopt the merger agreement and the transactions contemplated thereby and appoint the Shareholders’ Agentshareholders’ representative and the Alternate Shareholders’ Agent;alternate shareholders’ representative; and

 

·any other business that properly comes before the special meeting and any adjournment or postponement thereof.

Record date and voting rights for the special meeting

Delavan

STC has set the close of business on      , 2014,2019, as the record date for determining the holders of its common stock entitled to notice of and to vote at the special meeting. Only DelavanSTC shareholders at the close of business on the record date are entitled to notice of and to vote at the special meeting. As of the record date, there were       shares of DelavanSTC common stock outstanding and entitled to vote at the special meeting.

QuorumQuorum

The presence in person or by proxy of at least 51%a majority of the outstanding shares of Delavan common stockSTC entitled to vote on the matter at the special meeting is required for a quorum to be present for consideration of such matter at the special meeting. Abstentions and broker non-votes will count toward the establishment of a quorum.quorum, but broker non-votes will not count toward the establishment of a quorum because no routine matters will be brought before the meeting.

Vote required

Approval of the merger agreement proposal and the proposal to appoint Michael J. MurphyAnthony V. Sisto and any successors thereto to serve as the Shareholders’ Agentshareholders’ representative upon adoption of the merger agreement, including the appointment of James SaerKeith Kotche to serve as the Alternate Shareholders’ Agent,alternate shareholders’ representative, each requirerequires the affirmative vote of at least a majority of the outstanding shares of DelavanSTC common stock entitled to vote. Approval of the proposal to adjourn the special meeting to permit further solicitation in the event that an insufficient number of shares are present in person or by proxy to adopt the merger agreement and the transactions contemplated thereby and to appoint the Shareholders’ Agentshareholders’ representative and the Alternate Shareholders’ Agentalternate shareholders’ representative requires the affirmative vote of at least 51%a majority of the shares of Delavan common stockSTC entitled to vote, present in person or by proxy, if a quorum is present. In

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the absence of a quorum, holders of at least 51%a majority of the shares of Delavan common stockSTC present in person or by proxy at the special meeting may adjourn the special meeting.

The failure of a DelavanSTC shareholder to vote or to instruct his or her broker, bank or nominee to vote if his or her shares are held in “street name”, which we refer to as a broker non-vote, will have the same effect as voting against the proposals to adopt the merger agreement and to appoint the Shareholders’ Agentshareholders’ representative and the Alternate Shareholders’ Agentalternate shareholders’ representative and will have no effect on the meeting adjournment proposal. For purposes of the shareholder vote, an abstention, which occurs when a shareholder attends a meeting, either in person or by proxy, but indicates on his or her proxy card that he or she is abstaining from voting, will have the same effect as voting against the proposals to adopt the merger agreement, appoint the Shareholders’ Agentshareholders’ representative and the Alternate Shareholders’ Agentalternate shareholders’ representative and to adjourn the special meeting.

Shares held by DelavanSTC directors; voting agreement

All

Certain of Delavan’sSTC’s directors who own shares of DelavanSTC common stock, whose aggregate ownership representsrepresented approximately 28%46% of the outstanding shares of DelavanSTC common stock as of September 30, 2014,June 5, 2019, have committed to vote their shares in favor of the merger and any other matter necessary for consummation of the transactions contemplated by the merger agreement. Wintrust does not own any shares of DelavanSTC common stock. See “The Merger—Voting agreement” on page 4553 for a description of the provisions of the voting agreement.

How to vote

You may vote in person at the special meeting or by proxy. To ensure your representation at the special meeting, we recommend you vote by proxy even if you plan to attend the special meeting. You can always change your vote at the meeting.

Voting instructions are included on your proxy form, which should be returned in the enclosed prepaid envelope. If you properly complete and timely submit your proxy, your shares will be voted as you have directed. You may vote for, against, or abstain with respect to the approval of the merger and the other proposals. If you are the record holder of your shares and submit your proxy without specifying a voting instruction, your shares will be voted as the DelavanSTC board of directors recommends and will be voted“FOR”FOR adoption of the merger agreement, “FOR” the appointment of Michael J. MurphyAnthony V. Sisto and any successors thereto to serve as the Shareholders’ Agentshareholders’ representative upon adoption of the merger agreement, including James Saerthe appointment of Keith Kotche to serve as the Alternate Shareholders’ Agent,alternate shareholders’ representative, and“FOR”FOR the adjournment of the special meeting to permit further solicitation in the event that an insufficient number of shares are present in person or by proxy to adopt the merger agreement and the transactions contemplated thereby.

Revocability of proxies

You may revoke your proxy at any time before it is voted by:

 

·filing with Delavan’sSTC’s secretary a duly executed revocation of proxy;

 

·submitting a new proxy with a later date; or

 

·voting in person at the special meeting.

Attendance at the special meeting will not, in and of itself, constitute a revocation of a proxy. All written notices of revocation and other communication with respect to the revocation of proxies should be addressed to: DelavanSTC Bancshares Inc.Corp., 820 Geneva460 S. 1st Street, Delavan, Wisconsin 53115,St. Charles, Illinois 60174, Attention: J. Edward Clair,Levato, Secretary.

Proxy solicitation

In addition to this mailing, proxies may be solicited by directors, officers or employees of DelavanSTC in person or by telephone or electronic transmission. None of such directors, officers or employees will be directly compensated for such services. DelavanSTC will pay the costs associated with the solicitation of proxies for the special meeting.

Other business; adjournments

Delavan

STC is not currently aware of any other business to be acted upon at the DelavanSTC special meeting. If, however, other matters are properly brought before the special meeting, or any adjournment or postponement thereof, your proxies include discretionary authority on the part of the individuals appointed to vote your shares to act on those matters according to their best judgment.

Adjournments may be made for the purpose of, among other things, soliciting additional proxies. Any adjournment may be made from time to time by the affirmative vote of the holders of at least 51%a majority of the shares of Delavan common stockSTC present in person or by proxy at the special meeting, whetherif less than a quorum is present, or notby the affirmative vote of the holders of at least a majority of the shares of STC present in person or by proxy at the special meeting and entitled to vote, if a quorum is present, without further notice other than by announcement at the special meeting.

THE MERGER

This section of the proxy statement/prospectus describes material aspects of the merger. While Wintrust and DelavanSTC believe that the description covers the material terms of the merger and the related transactions, this summary may not contain all of the information that is important to you. You should carefully read this entire proxy statement/prospectus, the attached Annexes, and the other documents to which this proxy statement/prospectus refers for a more complete understanding of the merger. The merger agreement and plan of merger attached hereto as Annex A,A-1, as amended by the amendment to the merger agreement attached hereto as Annex A-2, not this summary, is the legal document which governs the merger.

GeneralGeneral

The DelavanSTC board of directors is using this proxy statement/prospectus to solicit proxies from the holders of DelavanSTC common stock for use at the DelavanSTC special meeting, at which DelavanSTC shareholders will be asked to vote on the adoption of the merger agreement and thereby approve the merger. When the merger is consummated, DelavanSTC will merge with and into Merger Co. and will cease to exist. Merger Co. will survive the merger and remain a wholly-owned subsidiary of Wintrust. At the effective time of the merger, holders of DelavanSTC common stock will exchange their shares for cash and shares of Wintrust common stock, subject to adjustment, and holders of DelavanSTC options will exchange such options for Wintrust options. Each share of DelavanSTC common stock will be exchanged for the per share merger consideration, the stock component of which cannot be determined until two trading days before completion of the merger. See “Description of the Merger Agreement—Consideration to be received in the merger” for a detailed description of the method for determining the per share merger consideration.

Only whole shares of Wintrust common stock will be issued in the merger. As a result, cash will be paid instead of any fractional shares based on the reference price of Wintrust’s common stock during the reference period.stock. Shares of DelavanSTC common stock held by DelavanSTC shareholders who elect to exercise their dissenters’ rights will not be converted into merger consideration.

The companies

Wintrust

Wintrust Financial Corporation, an Illinois corporation, which was incorporated in 1992 and is a financial holding company based in Rosemont, Illinois. Wintrust provides community-oriented, personal and commercial banking services to customers located primarily in the Chicago metropolitan area, southern Wisconsin and in southeastern Wisconsin northwest Indiana

through its fifteen wholly-owned banking subsidiaries, as well as the origination and purchase of residential mortgages for sale into the secondary market through Wintrust Mortgage, a division of Barrington Bank and Trust Company, N.A. Wintrust provides specialty finance services, including financing for the payment of commercial insurance premiums and life insurance premiums on a national basis through FIRST Insurance Funding, a division of its wholly-owned subsidiary First Insurance Funding CorporationLake Forest Bank, and Wintrust Life Finance, a division of Lake Forest Bank, and in Canada through its Canadian premium finance company, First Insurance Funding of Canada, lease financing and other direct leasing opportunities through its wholly-owned subsidiary, Wintrust Asset Finance, and short-term accounts receivable financing and outsourced administrative services through its wholly-owned subsidiary,

Tricom, Inc. of Milwaukee. Wintrust also provides a full range of wealth management services primarily to customers in the Chicago metropolitan area, southern Wisconsin and in southeastern Wisconsinnorthwest Indiana through threefour separate subsidiaries, The Chicago Trust Company, N.A., Wayne HummerWintrust Investments, LLC, and Great Lakes Advisors, LLC and Chicago Deferred Exchange Company, LLC.

As of September 30, 2014,March 31, 2019, Wintrust had total assets of approximately $19.2$32.4 billion, total loans, excluding loans held-for-sale, and covered loans, of approximately $14.1$24.2 billion, total deposits of approximately $16.1$26.8 billion, and total shareholders’ equity of approximately $2.0$3.4 billion.

Wintrust common stock is traded on NASDAQNasdaq under the ticker symbol “WTFC.”

Financial and other information relating to Wintrust, including information relating to Wintrust’s current directors and executive officers, is set forth in Wintrust’s 2013 2018 Annual Report on Form 10-K filed with the SEC on February 28, 2019, Wintrust’s Proxy Statement for its 20142019 Annual Meeting of Shareholders filed with the SEC on April 4, 20145, 2019 and Wintrust’s Quarterly Reports on Form 10-Q and Current Reports on Form 8-K filed during 2014,2019, which are incorporated by reference to this proxy statement/prospectus. Copies of these documents may be obtained from Wintrust as indicated under “Where You Can Find More Information” on page 78.87. See “Incorporation of Certain Information by Reference” on page 78.87.

WintrustWTFC STCBC Merger Co.Sub LLC

Wintrust

WTFC STCBC Merger Co., a Wisconsin corporation,Sub LLC, an Illinois limited liability company, is a wholly-owned subsidiary of Wintrust and was formed solely for the purpose of consummating the merger, and has not carried on any activities to date, except for activities incidental to its formation and activities undertaken in connection with the merger.

DelavanSTC Bancshares Inc.Corp.

Delavan

STC Bancshares Inc.Corp., a Wisconsinan Illinois corporation, is a bank holding company headquartered in Delavan, Wisconsin.St. Charles, Illinois. Its primary business is operating its bank subsidiary, CommunitySTC Bank, a Wisconsinan Illinois state bank, with fourfive banking locations in southeastern Wisconsin. Delavannortheastern Illinois. STC began operations in 1996.January 2006. As of September 30, 2014, DelavanMarch 31, 2019, STC had consolidated total assets of approximately $208$276.7 million, deposits of approximately $167$243.9 million and shareholders’ equity of approximately $27$31.6 million. DelavanSTC is not a public company, and, accordingly, there is no established trading market for DelavanSTC common stock.

STC’s proposalsDelavan’s proposals

At the DelavanSTC special meeting, holders of shares of DelavanSTC common stock will be asked to vote on the adoption of the merger agreement and thereby approve the merger.merger and the appointment of Anthony V. Sisto and any successors thereto to serve as the shareholders’ representative upon adoption of the merger agreement, including the appointment of Keith Kotche to serve as the alternative shareholders’ representative, with respect to taking any and all actions upon the adoption of the merger agreement that are specified or contemplated by the merger agreement, the escrow agreement or the reserve agreement (including as manager of the litigation entity) on behalf of all STC shareholders. The merger will not be completed unless Delavan’sSTC’s shareholders adopt the merger agreement and thereby approve the merger.

Background of the merger

Delavan’s

STC’s board of directors and senior management regularly review and evaluate Delavan’sthe organization’s business, strategic direction, performance, prospects and strategic alternatives.  In March 2014, Delavan’s Presidentthe context of such reviews, the strategic alternatives considered by the STC board have included, among other things, continuing its on-going operations as an independent institution, acquiring other depository institutions, opening new branch offices, buying other financial services firms engaged in complementary lines of business and Chief Executive Officer, Michael J. Murphy, received an unsolicited contact from the chief executive officer of another bank holding company, which we refer to as Company A, regardingentering into a possible strategicmerger or acquisition transaction between the two organizations. The chief executive officer of Company A requestedwith a copy of Delavan’s 2014 budget for the purpose of calculating the pro-forma financial performance of the two companies.similarly sized or larger institution.

On March 27, 2014, at a

The board of directors meeting, Mr. Murphy informed Delavan’s board about his discussions with Company A and about its request for the 2014 budget information. At the meeting, the board authorized Mr. Murphy to provide Company A with high level 2014 budget information with respect to Delavan and to inform Company A that the parties would need to enter into a confidentiality agreement before further information would be provided. The board and senior management also discussedof STC have been aware in depth various strategic options generally available to Delavan, and the pros and consrecent years of each such option: a merger of equals (with concerns raised regarding loss of control, known and hidden credit quality issues of any strategic partner, and the integration of

cultures), a sale of Delavan to a larger institution, and remaining an independent organization (with concerns raised regarding increasing banking regulations, increasing cost of compliance, loan growth, the continuing low interest rate environment and decreasing margins). As part of this overall discussion, Delavan’s board and senior management also considered the competition in Delavan’s primary market, anticipated increases in capital requirements and trends in mergers and acquisitionschanges in the financial services sector.industry and the regulatory environment as well as the competitive challenges facing a financial institution such as STC.  These challenges have included increasing government regulation, increasing expense burdens and commitments for technology and training, an interest rate environment that has resulted in pressure on interest rate spreads and margins, and increasing competition in the delivery of financial products and services combined with increased customer expectations for the availability of sophisticated financial products and services from financial institutions.

After

On May 11, 2018, STC’s board of directors met to discuss the March 27, 2014 board meeting, Mr. Murphy met with managementpotential direction of Company A and was informed that Company A had engaged an investment banker and was interested in further exploring a strategic transaction with Delavan. Management of Company A provided Mr. Murphy with Company A’s preliminary view of its valuation of Delavan but stressed that Company A believed that its valuation might increase after it had an opportunity to perform a due diligence review of Delavan. Management of both companies agreed that it would be appropriate and advisable for Delavan to engage its own investment banker to assist it inthe organization, including first, the process of identifying possible strategic partnersdetermining whether any other institutions would be interested in acquiring STC and, purchasers for Delavan.

Mr. Murphy contactedif so, what the members of the Delavan board to discuss the meeting with Company A. The board directed Mr. Murphy to set up a meeting with representatives of Baird. Certain members of Delavan’s senior management met with Baird on April 16, 2014. At that meeting, Baird’s representatives reviewed with senior management: (i) Bairdpotential purchase prices would be and Baird’s role in transactions of this type; (ii) the current banking M&A landscape and valuations; (iii) Baird’s preliminary observations regarding Delavan and Community Bank; (iv) strategic considerations; and (v) a list of potential buyers.

At the board’s April 17, 2014 meeting, management provided a copy of the Baird discussion materialswhether those would be acceptable to the directors. The board reviewedand STC’s shareholders, and second, to consider the materials carefully,option of accelerating organic growth by hiring a team of experienced and discussed whether to engage Baird. The board determined that the timing was appropriate to engage Baird to represent Delavan as its investment banker and financial advisor and seek out potential partiessuccessful commercial lenders who might havehad expressed an interest in joining STC.  Also present at the meeting were representatives of D.A. Davidson to discuss D.A. Davidson providing investment banking services in connection with a strategic transaction with Delavan. The boardpotential business combination.  Throughout the summer and into early fall 2018, these informal discussions continued on dual tracks.

Senior management of STC also authorized the engagementcontacted representatives of BoardmanBarack Ferrazzano Kirschbaum & ClarkNagelberg LLP, which we refer to as Boardman,Barack Ferrazzano, to provide legal services in connection with this process.

Between the board’s April 17 and May 15, 2014 meetings, Mr. Murphy held numerous discussions with representativesreview of Boardman about the process to be used to identify parties interested inSTC’s strategic alternatives, including entry into a possible strategic transaction.  WithBarack Ferrazzano provided STC with an outline regarding action items and considerations that a company should be aware of when it begins the consideration of a strategic business combination.

On September 21, 2018, at a meeting of STC’s board of directors, a representative of Barack Ferrazzano gave a presentation to the board regarding the board’s fiduciary duties in connection with major business decisions, such as the decision to sell the company.  At this meeting, STC’s board of directors authorized the formation of a corporate developments committee, consisting of five of STC’s directors, to consider and negotiate any proposals for a business combination.  STC’s board of directors also authorized management to continue discussions with investment banking firms to assist in these efforts, including D.A. Davidson.

During September and October 2018, senior management of STC continued meeting with representatives of D.A. Davidson to discuss formalizing the engagement of D.A. Davidson to provide investment banking services in connection with a potential business combination.  Senior management of STC, with the assistance of Boardman, managementBarack Ferrazzano, negotiated the terms of an engagement letter with D.A. Davidson and executedon October 22, 2018, formally engaged D.A. Davidson to serve as its investment banker in connection with its exploration of a possible strategic transaction, identification of possible strategic partners, and potential delivery of an opinion with respect to the fairness, from a financial point of view, of any merger consideration payable to STC’s shareholders.  STC’s board of directors ratified the engagement agreementletter with BairdD.A. Davidson at its meeting held on April 28, 2014. Shortly afterOctober 26, 2018.

On October 26, 2018, representatives of D.A. Davidson met with STC’s board of directors to discuss the April 17, 2014 board meeting, Baird began a more comprehensive due diligence reviewuniverse of Delavan and Community Bank, meeting with members of Delavan’s management, and began developing confidential marketing materials concerning Delavan. Thereafter, Baird began contacting prospective bidders and distributed confidentiality agreements to those bidders expressing an interest in a possible transaction with Delavan. Baird provided copies of the confidential marketing materials to each party that had executed a confidentiality agreement and worked with potential strategic partners with the goal of receiving initial bids by June 24, 2014. At the May 15, 2014 board meeting, Mr. Murphy provided the board withand provide an update on the current statusvaluation.  D.A. Davidson was authorized to contact certain strategic partners for STC, including Wintrust.  As a next step, an in-person meeting with Wintrust was arranged for November 14, 2018, which was attended by certain members of the process.STC’s management and board of directors.  During this meeting, Wintrust’s management provided verbal interest in entering into exclusive discussions with STC about a possible acquisition.

At the JuneOn December 19, 2014 board meeting, Mr. Murphy reported to the board that Baird had contacted 14 potential merger candidates on behalf of Delavan2018, Wintrust and that seven merger candidates had executed theSTC entered into a joint confidentiality agreement and received confidential marketing materialsto allow Wintrust an opportunity to obtain limited due diligence information about STC for its consideration in developing the terms of a strategic transaction with respectSTC.

On February 20, 2019, Wintrust provided to Delavan.

AtSTC a meeting of the Delavan board on June 27, 2014, a representative of Baird reviewed the results of the proposal solicitation process with Delavan’s board and senior management. Of the seven parties which had executed confidentiality agreements and received copies of the marketing materials, three institutions, including Wintrust and Company A, presented Delavan with non-binding written expressionsindication of interest for a proposed acquisition,merger transaction with STC.  This indication of interest proposed an aggregate merger consideration of $46.0 million for all of the outstanding capital stock of STC and all outstanding options to purchase common shares of STC, or approximately $96.80 per share of STC common stock, payable in cash, although indicating the potential for a portion of the consideration to be paid in Wintrust’s common stock.  This indication of interest included several financial conditions by STC, including a requirement that STC have a specified minimum adjusted common equity at the time of closing, and contained provisions regarding the potential requirement for post-closing indemnification of Wintrust for certain matters.  The proposed offer was subject to completion of due diligence by Wintrust and the negotiationother customary conditions.  Mr. Sisto, chairman of a definitive agreement, and two parties provided a verbal expression of interest. Baird and the board discussedof directors of STC, informed the price rangeboard of eachhis receipt from Wintrust of the proposals received, the form of consideration offered, the reputation of each party, the strategic opportunity offered by each possible transaction and the perceived ability of each party to consummate a transaction. Baird also reviewed with the board recent Midwest transactions in the last 12 months, nationwide transactions during the last six months, and information about the current banking market and valuations. The board members asked Baird questions regarding the expressionsindication of interest and forwarded the same to directors for their terms.review.

On February 21, 2019, the STC board of directors held a meeting to review and discuss Wintrust’s indication of interest.  A representative of D.A. Davidson was present at this meeting.  The board of directors discussed at length the terms of the indication of interest, including the amount and type of merger consideration.  The board of directors authorized management, through D.A. Davidson, to propose a counteroffer to Wintrust, the revised terms of which were discussed by the board.

On February 22, 2019, D.A. Davidson communicated to Wintrust the counteroffer proposed by STC’s board of directors, which included, among other items, an increase of the merger consideration to $100 per share and a change in the type of merger consideration to 50% Wintrust common stock and 50% cash, with a fixed exchange ratio based on the current trading price of Wintrust common stock.

On March 8, 2019, Wintrust sent STC a revised non-binding indication of interest.  This indication of interest, which was subject to satisfactory completion of due diligence by Wintrust, included merger consideration of $100.00 per share.  The proposed merger consideration would be payable 50% in cash and 50% in Wintrust common stock and included a variable exchange ratio with a collar of $5.00 above and below the trading price of Wintrust common stock determined at the time of signing a binding merger agreement.  In addition, currently outstanding options to purchase STC common stock would be converted into options to purchase Wintrust common stock.  The revised non-binding indication of interest also included adjustments to the required minimum adjusted common equity amount as well as other changes.

On March 12, 2019, senior management of STC and representatives of D.A. Davidson and Barack Ferrazzano met to review and consider the response to Wintrust’s indication of interest.  Senior management of STC directed D.A. Davidson to request several modifications to the indication of interest and clarify certain items, including increasing the collar and removing the requirement for post-closing indemnification.  D.A. Davidson relayed these requests to Wintrust on March 14, 2019.

On March 19, 2019, Wintrust provided a further revised non-binding indication of interest in response to the requests of STC, as well as an exclusivity letter.  Wintrust agreed to increase the collar from $5.00 to $6.00 and clarified other items in the further revised indication of interest, but Wintrust retained the ability to require post-closing indemnification.

On March 19, 2019, senior management of STC and representatives of D.A. Davidson and Barack Ferrazzano met to discuss the further revised non-binding indication of interest.  On March 19, 2019, the directors of STC reviewed, considered and discussed the revised offer from Wintrust.  The board reviewed the long-term prospects of STC and again concluded that it was in the best interest of STC and its shareholders to pursue a strategic transaction with another financial institution.  The board then discussed and evaluated the advisability of proceeding with a strategic transaction andproposed offer from Wintrust.  A discussion ensued regarding the relative advantages and disadvantagesproposed terms of the various expressionsindication of interest.  TheAt the conclusion of the meeting, the board also discussed the steps

requiredauthorized STC to complete a merger and employee matters. Delavan senior management recommendedagree to the board that Delavan proceedterms of the indication of interest and to enter into negotiations with Wintrust and allow Wintrust to perform due diligence.regarding a definitive agreement.  The board concluded that, given the relative merits of the proposals presented by Baird, the initial proposal from Wintrust was the most attractive proposal received, as the other expressionsindication of interest included a lower purchase price and/or other less desirable terms. The board unanimously decided that Delavan should move forwardand exclusivity letter were signed by invitingSTC on March 19, 2019.

STC provided access to an electronic data room for Wintrust to conduct additional due diligence, in order to obtain a final bid. Delavan’s board determined not to seek additional offers at that time becauseand during the months of the favorable termsApril, May and June 2019, representatives of Wintrust’s proposal, Delavan’s confidence in Wintrust’s management teamWintrust and Baird’s prior discussions with other possible transaction partners over the past several months.

In early July 2014,senior management of Company A again contacted Mr. Murphy about a possible strategic transaction. Mr. Murphy informed Company ASTC communicated frequently to ensure that Delavan was working with another potential acquirer becauseall requested information and materials were included in the potential acquirer’s valuationelectronic data room and to clarify questions as they arose.  Wintrust also conducted an on-site review of Delavan was higher than the valuation of Company A. Company A then offered to increase its bid, but Mr. Murphy informed Company A that the existing bid received by Delavan was still higher. STC’s credit files and operational and regulatory compliance procedures.

On July 11, 2014, Baird received a letter of intent from Company A for consideration by the board.

At the July 17, 2014 board meeting, Mr. Murphy provided an update on the due diligence performed by Wintrust on July 16, 2014 and July 17, 2014 and noted that Wintrust was expected to provide the results of its due diligence within a week. In addition, the board discussed at length the letter of intent received from Company A. The board determined to reject Company A’s offer because the letter of intent included less favorable terms thanApril 22, 2019, Wintrust’s offer, and the proposed purchase price was less than Wintrust’s bid.

Between July 25, 2014 through the beginning of October 2014, Delavan, Wintrust, and their respective legal advisors at Boardman andcounsel, Schiff Hardin LLP, which we refer to as Schiff Hardin, delivered a first draft of a definitive merger agreement.  From April 22, 2019, through the beginning of June 2019, STC, Wintrust, and their respective legal advisors at Barack Ferrazzano and Schiff Hardin engaged in extensive due diligence, negotiated the terms of the proposed merger agreement, escrow agreement, reserve agreement, assignment agreement and the voting agreement, reviewed disclosure schedules to be entered into by certain shareholders of Delavan,the proposed merger agreement and exchanged comments and revised drafts of the agreements. Representativesagreements and documents.  During this period, counsel for STC and counsel for Wintrust exchanged multiple drafts of Baird facilitatedthe proposed merger agreement, ancillary agreements, and disclosure schedules.  During this period, Mr. Sisto provided periodic updates to the board regarding the negotiation process and outstanding issues.

In May 2019, at Wintrust’s request, STC ordered title commitments, surveys and environmental reports regarding its bank branch properties.  Wintrust and Schiff Hardin reviewed these documents, and Barack Ferrazzano and Schiff Hardin worked together to clear from the title commitments certain encumbrances related to the owned bank office properties.  During this time, Wintrust also continued its ongoing due diligence review of STC’s business and operations.

Throughout late May 2019, members of STC’s management and representatives of D.A. Davidson also conducted a business and financial due diligence review of Wintrust in light of the agreements.

At a meetingportion of the Delavanper share merger consideration payable in Wintrust common stock.

On May 31, 2019, STC’s board of directors met during its regular board meeting to discuss the current status of the proposed merger transaction with Wintrust.  At this meeting, the proposed voting agreement was provided to the directors for their review.  In addition, the board approved certain matters related to the currently outstanding stock options for shares of STC common stock to facilitate their conversion into stock options for shares of Wintrust common stock at the closing of the merger.

During the week of June 5, 2019, STC confirmed with its accountants that amounts related to certain customer litigation were required to be charged-off on the financial statements of STC, which would result in a decrease in STC’s closing equity and, as a result, decrease the final merger consideration payable at closing to STC shareholders.  To retain for STC’s shareholders the benefit from any future amounts received in connection with such customer litigation, STC negotiated with Wintrust to allow STC to provide for the assignment to the shareholders’ representative all rights and liabilities in connection with such customer litigation and to hold back $400,000 of the merger consideration for the funding of legal fees related to such customer litigation and any related expenses of the shareholders’ representative.  In addition, all other remaining matters were resolved and the final terms of the proposed merger agreement and the related documents were negotiated by STC and Wintrust and their respective legal counsel.

On June 5, 2019, the board of directors of STC held on October 13, 2014,a special meeting to review and discuss the proposed merger transaction as set forth in the proposed merger agreement and the related agreements that had been negotiated by STC and Wintrust and their respective advisors.  Also attending were representatives of Barack Ferrazzano and D.A. Davidson.  In advance of the meeting, the board of directors received for their review copies of the proposed merger agreement and other ancillary agreements.  As an initial matter at the board meeting, a representative of BairdBarack Ferrazzano reviewed with the boarddirectors their previous discussions regarding directors’ fiduciary duties in connection with their review and consideration of the process leading to the proposed transaction and the course of negotiations with Wintrust.

A representative of BoardmanBarack Ferrazzano also reviewed in detail with the board the terms of the current draft of the proposed merger agreement and related voting agreement, escrow agreement, reserve agreement and assignment agreement, including the scope of theSTC’s representations and warranties, the nature of Delavan’sSTC’s operating covenants prior to closing, the provision relating to non-solicitation of competing transactions, the proposed closing

conditions, the termination provisions, the indemnification provisions and termination provisions. Bairdthe provisions related to the assignment of certain customer litigation claims.

After discussion by the board of the terms and conditions of the merger agreement and ancillary agreements, D.A. Davidson provided a financial analysis to the board of the proposed merger transaction with Wintrust and reviewed in detail with the board the terms of the merger consideration. BairdD.A. Davidson also discussed in detail with the board in detail its fairness opinion, including theits underlying analysis it undertook and its conclusions.  The Delavan board engaged in a discussion with Delavan’s advisors and accountants regarding the proposed draftD.A. Davidson also provided an analysis of the merger agreement, including the final businessfinancial terms of the transaction. Baird thenproposed transaction relative to other transactions in Illinois and nationwide.  At the conclusion of its presentation, D.A. Davidson delivered its opinion that, as of the date of such opinion and subject to the qualifications, limitations and assumptions set forth therein, the per share merger consideration to be received by the shareholdersholders of DelavanSTC common stock in the proposed transactionmerger is fair to such shareholders from a financial point of view.  The STC board engaged in a discussion with STC’s advisors regarding the proposed merger agreement and ancillary agreements, including the final business terms of the proposed merger and basis for the fairness analysis.

After the conclusion of theall presentations and discussions at the October 13, 2014June 5, 2019 meeting, and after discussion and analysis among the Delavanmembers of the board of directors of STC, including consideration of the factors described under “The Merger—STC’s reasons for the merger and recommendation of the board of directors,” the board of directors of STC determined that the merger and the transactions contemplated by the proposed merger agreement were advisable to and in the best interests of STC and unanimously approved the proposed merger agreement and all related agreements and the appointment of Mr. Sisto as the shareholders’ representative.  STC’s board of directors resolved to recommend that DelavanSTC’s shareholders approve the merger and authorized Mr. Murphy to execute the merger agreement and additional documentationauthorized Mr. Sisto to execute the proposed merger agreement and ancillary agreements on behalf of DelavanSTC.

After this meeting, STC and approve such minor modifications toWintrust entered into the merger agreement included as he may deem necessary, beneficial, advantageous, proper and efficient. The board unanimously determined that the merger would be in the best interests of Delavan, its shareholders and Community Bank’s employees and customers. On October 13, 2014, the merger agreement was finalized and executed by Delavan and Wintrust.

DelavanAnnex A-1 to this proxy statement/prospectus.  STC and Wintrust issued a joint press release later in the afternoon on October 14, 2014June 5, 2019, announcing the execution of the merger agreement.

On November 19, 2014, DelavanJuly 1, 2019, STC and Wintrust entered into thean amendment to the merger agreement included inas Annex AA-2 to this proxy statement/prospectus.

Fairness Opinion of Delavan’sSTC’s Financial Advisor

This section (ending on page 39) provides

On October 22, 2018, STC entered into an engagement agreement with D.A. Davidson to render financial advisory and investment banking services to STC. As part of its engagement, D.A. Davidson agreed to assist STC in analyzing, structuring, negotiating and, if appropriate, effecting a summary of the analysis conducted by Baird,transaction between STC and reflects certain assumptions made by Baird based upon the financial information reviewedanother corporation or obtained in connection with preparing such analysis, as further described herein.

Thebusiness entity. D.A. Davidson also agreed to provide STC’s board of directors of Delavan retained Baird in connection with the merger and to render a writtenan opinion as to the fairness, from a financial point of view, to Delavan of the Per Share Merger Consideration (as defined in the opinion)per share merger consideration to be received by the holders of DelavanSTC common stock pursuantin the proposed merger. STC engaged D.A. Davidson because D.A. Davidson is a nationally recognized investment banking firm with substantial experience in transactions similar to the terms of, and subject to the conditions set forth in, the Agreement and Plan of Merger by and between Delavan and Wintrust, and the respective wholly-owned subsidiary banks thereof.

On October 13, 2014, Baird rendered its oral opinion to the board of directors of Delavan to the effect that, subject to the contents of such opinion, including the various assumptions and limitations set forth therein, Baird was of the opinion that, as of such date, the Per Share Merger Consideration to be received by the holders of Delavan common stock was fair from a financial point of view.

As a matter of firm policy, Baird’s opinion was approved by a “fairness committee,” a majority of the members of which were not involved in providing financial advisory services on Baird’s behalf to Delavan in connection with the merger.

The full text of Baird’s written opinion, dated October 13, 2014 which sets forth the assumptions made, general procedures followed, matters considered and limitations on the scope of review undertaken by Baird in rendering its opinion, is attached asAnnex Dmerger and is incorporated herein by reference. Baird’s opinion is directed only to the fairness, as of the date of the opinionfamiliar with STC and from a financial point of view, to Delavan of the Per Share Merger Consideration and does not constitute a recommendation to any shareholder as to how such shareholder should vote with respect to the merger. Baird expresses no opinion about the fairness of the amount or nature of the compensation to any of Delavan’s officers, directors or employees, or class of such persons, relative to the Per Share Merger Consideration to be received by Delavan’s shareholders, or otherwise. The summary of Baird’s opinion set forth below is qualified in its entirety by reference to the full text of such opinion attached asAnnex D.Delavan shareholders are urged to read the opinion carefully in its entirety.

Baird, asbusiness. As part of its investment banking business, D.A. Davidson is regularlycontinually engaged in the valuation of financial institutions and their securities in connection with mergers and acquisitions and other corporate transactions. In conducting its

On June 5, 2019, the STC board of directors held a meeting to evaluate the proposed merger. At this meeting, D.A. Davidson reviewed the financial analysesaspects of the proposed merger and in arriving at itsrendered an opinion Baird reviewedto the STC board that, as such informationdate and took into account such financial and economic factors, investment banking procedures and considerations as it deemed relevant under the circumstances. In that connection,based upon and subject to the various assumptions qualificationsmade, procedures followed, matters considered and limitations on the review undertaken, the per share merger consideration was fair, from a financial point of view, to the holders of STC common stock in the proposed merger.

The full text of D.A. Davidson’s written opinion, dated June 5, 2019, is attached as Annex D to this proxy statement/prospectus and is incorporated herein by reference. The description of the opinion set forth herein Baird,is qualified in its entirety by reference to the full text of such opinion. STC’s shareholders are urged to read the opinion in its entirety.

D.A. Davidson’s opinion speaks only as of the date of the opinion, and D.A. Davidson undertakes no obligation to revise or update its opinion. The opinion is directed to the STC board of directors and addresses only the fairness, from a financial point of view, of the per share merger consideration to the holders of STC common stock in the proposed merger. The opinion does not address, and D.A. Davidson expresses no view or opinion with respect to,

(i) the underlying business decision of STC to engage in the merger, (ii) the relative merits or effect of the merger as compared to any alternative business transactions or strategies that may be or may have been available to or contemplated by STC or STC’s board of directors, or (iii) any legal, regulatory, accounting, tax or similar matters relating to STC, its shareholders or relating to or arising out of the merger. The opinion expresses no view or opinion as to any terms or other aspects of the merger, except for the per share merger consideration. STC and Wintrust determined the per share merger consideration through the negotiation process. The opinion does not express any view as to the amount or nature of the compensation to any of STC’s or Wintrust’s officers, directors or employees, or any class of such persons, relative to the per share merger consideration, or with respect to the fairness of any such compensation. The opinion has been reviewed and approved by D.A. Davidson’s Fairness Opinion Committee in conformity with its policies and procedures established under the requirements of Rule 5150 of the Financial Industry Regulatory Authority.

D.A. Davidson has reviewed the registration statement on Form S-4 of which this proxy statement/prospectus is a part and consented to the inclusion of its opinion to the STC board of directors as Annex D to this proxy statement/prospectus and to the references to D.A. Davidson and its opinion contained herein. A copy of the consent of D.A. Davidson is attached as Exhibit 23.2 to the registration statement on Form S-4.

In connection with rendering its opinion, D.A. Davidson reviewed, among other things: (i) reviewedthings, the following:

·                  a draft of the Agreement, dated June 4, 2019;

·                  certain internal information, primarily financial in nature, including (A) financial forecasts concerning the business and operations of Delavan (the “Forecasts”) as furnished and prepared by Delavan’s management for purposes of its analysis, (B) financial statements and other historical financial and business information about Wintrust and STC made available to D.A. Davidson from published sources and/or from the internal records of Delavan for the fiscal years ended December 31, 2011 through 2013, and interim financial statements of Delavan for the six months ended June 30, 2014, which Delavan’s management prepared and identified as being the most current financial statements available, and (C) financial statements of Wintrust for the fiscal years ended December 31, 2011 through 2013, and interim financial statements of Wintrust for the six months ended June 30, 2014, obtained from Wintrust’s publicly available annual and quarterly reports as filed with the Securities and Exchange Commission (the “SEC”); (ii) reviewedSTC that D.A. Davidson deemed relevant;

·                  certain publicly available information, including, but not limited to, Wintrust’s recent filings with the SEC and equity analyst research reports covering Wintrust prepared by various investment banking and research firms, including consensus earnings estimates for Wintrust for the years ending December 31, 20142019, December 31, 2020 and 2015; (iii) reviewedDecember 31, 2021 and for the principalyears ending December 31, 2022, December 31, 2023, and December 31, 2024 based on growth rate assumptions estimated by D.A. Davidson;

·                  financial termsprojections for STC for the years ending December 31, 2019, December 31, 2020 and December 31, 2021 provided by senior management and for the years ending December 31, 2022, December 31, 2023 and December 31, 2024 based on growth rate assumptions estimated by D.A. Davidson and in each case discussed with and confirmed by senior management of the draft dated October 10, 2014 of the Agreement in the form presented to the Board as they related to Baird’s analysis; (iv) considered the relative contributions of assets, liabilities, equity and earnings of Delavan and Wintrust to the resulting company; (v) compared the financial position and operating results of Delavan and Wintrust with those of certain publicly traded companies deemed relevant; (vi) compared the historical market prices, trading activity and market trading multiples of Wintrust’s common stock with those of certain other publicly traded companies deemed relevant; (vii) compared the Per Share Merger Consideration with the reported financial terms of certain other recent business combinations in the commercial banking industry deemed relevant, to the extent publicly available; (ix) reviewed certificates from Delavan addressed to Baird regarding the historical financial statements and Forecasts; (x) reviewed certain potential pro forma financial effects of the merger; (xi) reviewedSTC;

·                  the current market environment generally and the banking environment in particular;

·                  the financial terms of certain other transactions in the financial institutions industry, to the extent publicly available;

·                  the market and (xiii) reviewedtrading characteristics of selected public companies and selected public bank holding companies in particular;

·                  the relative contributions of Wintrust and STC to the combined company;

·                  the pro forma financial impact of the merger, taking into consideration the amounts and timing of the transaction costs and cost savings; and

·                  such other information, financial studies, analyses and investigations and financial, economic and market criteria and other information as D.A. Davidson considered relevant. Baird heldrelevant including discussions with membersmanagement and other representatives and advisors of Delavan’sWintrust and Wintrust’s respective senior managementsSTC concerning the historical and current business, financial condition, operating results of operations and prospects of DelavanWintrust and Wintrust, respectively. Baird also considered such other information, financial studies, analyses and investigations and financial, economic and market criteria deemed relevant for the preparation of the opinion.

STC.

In arriving at theits opinion, BairdD.A. Davidson assumed and relied upon without independent verification, the accuracy and completeness of all of the financial and other information that was publicly available, supplied or providedotherwise made available to, discussed with or reviewed by or on behalf of Delavan and Wintrust. Baird furtherfor D.A. Davidson. D.A. Davidson has relied on the assurances of the management of DelavanSTC that they are not aware of any facts or circumstances that would make any of such information, forecasts or analyses inaccurate or misleading. Baird was not asked to andD.A. Davidson did not independently verify, any publicly available information or information supplied by Delavan or Wintrust. Baird was not engaged to independently verify,and did not assume any responsibility to verify, assumed no liability for and expressed no opinion on, anyindependently verifying, such information and has assumed and relied upon, without independent verification, that neither Delavan nor Wintrust was aware of any information that might be material to the opinion that was not provided to Baird. Baird assumed and relied upon, without independent verification, that: (i) all material assets and liabilities (contingent or otherwise, known or unknown) of Delavan and Wintrust were set forth in their respective most recent financial statements provided to Baird or publicly available, and there was no information or facts that would make any of the information reviewed by Baird incomplete or misleading; (ii) the financial statements of Delavan and Wintrust provided to Baird or publicly available presented fairly the results of operations, cash flows and financial condition of Delavan and Wintrust, respectively, for the periods, and as of the dates, indicated and were prepared in conformity with U.S. generally accepted accounting principles consistently applied; (iii) the Forecasts for Delavan were reasonably prepared on bases reflecting the best available estimates and good faith judgments of Delavan’s senior management as to the future performance of Delavan, and Baird relied, without independent verification, upon such Forecasts in the preparation of the opinion, although Baird expressed no opinion with respect to the Forecasts or any judgments, estimates, assumptions or basis on which they were based, and assumed, without independent verification, that the Forecasts used in Baird’s analysis will be realized in the amounts and on the time schedule contemplated; (iv) the merger will be consummated in accordance with the terms and conditions of the Agreement without any amendment or modification thereto and without waiver by any party of any of the conditions to their respective obligations thereunder; (v) the representations and warranties contained in the Agreement are true and correct and that each party will perform all of the covenants and agreements required to be performed by it under the Agreement; (vi) all corporate, governmental, regulatory or other consents and approvals (contractual or otherwise) required to consummate the merger have been, or will be, obtained without the need for any changes to the Per Share Merger Consideration or other financial terms or conditions of the merger or that would otherwise materially affect Delavan or Wintrust or Baird’s analysis; (vii) the merger will be treated as a tax-free reorganization for U.S. federal income tax purposes; and (viii) with respect to the equity analyst research reports and consensus earnings estimates referred to above, Baird reviewed and discussed such forecasts and projections with the management of Wintrust and assumed, without independent verification, that such forecasts and projections represent reasonable estimates and judgments of the future financial results and condition of Wintrust, and Baird expressed no opinion with respect to such forecasts and projections or the assumptions on which they were based. Baird relied upon and assumed, without independent verification, that the final form of any draft documents referred to above will not differ in any material respect from such draft documents. Baird relied, without independent verification, as to all legal, regulatory, accounting, insurance and tax matters regarding the merger on the advice of Delavan and its professional advisors, and Baird assumed that all such advice was correct. In conducting their review, Baird did not undertake or obtainundertaken an independent evaluation or appraisal of any of the assets or liabilities (contingent or otherwise, knownotherwise) of STC or unknown) or solvency of Delavan or WintrustWintrust. In addition, D.A. Davidson did not assume any obligation to conduct, nor did Baird make aD.A.

Davidson conduct any physical inspection of the properties or facilities of DelavanSTC or Wintrust. Baird renderedWintrust and has not been provided with any reports of such physical inspections. D.A. Davidson assumed that there has been no material change in STC’s or Wintrust’s business, assets, financial condition, results of operations, cash flows, or prospects since the date of the most recent financial statements provided to D.A. Davidson.

With respect to the financial projections and other estimates (including information relating to certain pro forma financial effects of, and strategic implications and operational benefits anticipated to result from, the merger) provided to or otherwise reviewed by or for or discussed with D.A. Davidson, D.A. Davidson has been advised by management of STC that such forecasts and other analyses were reasonably prepared on bases reflecting the best currently available estimates and good faith judgments of management of STC as to the future financial performance of STC and the other matters covered thereby, and that the financial results (including the potential strategic implications and operational benefits anticipated to result from the merger) reflected in such forecasts and analyses will be realized in the amounts and at the times projected. D.A. Davidson assumes no responsibility for and express no opinion or evaluation on the collectability of any assetsas to these forecasts and analyses or the future performance of any loans of Delavan or Wintrust. Bairdassumptions on which they were based.

D.A. Davidson did not make an independent evaluation or appraisal of the loan and lease portfolios, classified loans, other real estate owned or any other specific assets, nor has D.A. Davidson assessed the adequacy of the allowance for loan losses of DelavanSTC or Wintrust, or the combined entity after the merger and didWintrust. D.A. Davidson has not reviewreviewed any individual credit files relating to DelavanSTC or Wintrust. BairdD.A. Davidson assumed that the respective allowances for loan losses for both DelavanSTC and Wintrust together with the assumed purchase accounting adjustments made by Wintrust with respect to Delavan, are adequate to cover such losses and will be adequate on a pro forma basis for the combined entity. BairdD.A. Davidson did not consider any expensesmake an independent evaluation of the quality of STC’s or Wintrust’s deposit base, nor has D.A. Davidson independently evaluated potential adjustments todeposit concentrations or the Per Share Merger Consideration relating todeposit composition of STC or Wintrust. D.A. Davidson did not make an independent evaluation of the quality of STC’s or Wintrust’s investment securities portfolio, nor has D.A. Davidson independently evaluated potential concentrations in the investment securities portfolio of STC or Wintrust.

D.A. Davidson assumed that all representations and warranties contained in the merger agreement and all related agreements are true and correct in all respects material to D.A. Davidson’s analysis, and that the merger will be consummated in accordance with the terms of the merger agreement, without waiver, modification, or amendment of any term, condition or covenant thereof the effect of which would be in any respect material to D.A. Davidson’s analysis. D.A. Davidson has assumed that all material governmental, regulatory or other consents, approvals, and waivers necessary for the consummation of the merger will be obtained without any material adverse effect on STC or the contemplated benefits of the merger.

D.A. Davidson assumed in all respects material to its analysis that STC and Wintrust will remain as part ofgoing concerns for all periods relevant to its analysis. Baird also assumed the value of the per share stock Consideration to be $50.80 and thus the value of the Per Share Merger Consideration to be $101.61.

Baird’sD.A. Davidson’s opinion was necessarily was based upon financial,information available to D.A. Davidson and economic, monetary, market, financial and other conditions as in effectthey exist and can be evaluated on and the information made available asdate the fairness opinion letter was delivered to STC’s board of October 13, 2014, and Baird’sdirectors.

D.A. Davidson’s opinion diddoes not predict or take into account any changesindividual circumstances of specific holders with respect to control, voting or eventsother rights which may occur, or information which may become available, after October 13,

distinguish such holders.

2014. Baird was under no obligation to update, revise, reaffirm or withdraw the opinion, or otherwise comment on or consider events occurring after October 13, 2014. Furthermore, Baird expressedD.A. Davidson also expresses no opinion as to the priceactual value of Wintrust common stock when issued in the merger or trading rangethe prices at which any of Wintrust’s securities (including Wintrust’sSTC common stock)stock or Wintrust common stock will trade following October 13, 2014announcement of the merger or at any future time.

D.A. Davidson has not evaluated the solvency or fair value of STC or Wintrust under any state, federal or other laws relating to bankruptcy, insolvency or similar matters. This opinion is not a solvency opinion and does not in any way address the solvency or financial condition of STC or Wintrust. D.A. Davidson is not expressing any opinion as to the effectimpact of the merger on such pricethe solvency or trading range,viability of STC or any earnings or ownership dilutive impact that may result from Wintrust’s issuance of its common stock in the merger. Such price and trading range may be affected by a number of factors, including but not limited to (i) dispositions of the common stock of Wintrust by shareholders within a short period of time after, or other market effects resulting from, the announcement and/or effective date of the merger; (ii) changes in prevailing interest rates and other factors which generally influence the price of securities; (iii) adverse changes in the current capital markets; (iv) the occurrence of adverse changes in the financial condition, business, assets, results of operations or prospects of Delavan or Wintrust or in the financial services industry; (v) any actions or inactions by, or restrictions of, federal, state or other governmental agencies or regulatory authorities; and (vi) timely completion of the merger on terms and conditions that are acceptable to all parties at interest. Baird did not express any opinion on the liquidity or marketability of the Wintrust common stock or the ability of the holders of such stock, including the holders of Delavan common stock who will receive shares ofSTC or Wintrust common stock in the merger, to sell shares of Wintrust common stock at any time.pay their respective obligations when they come due.

Baird’s opinion has been prepared at the request and for the information of and is directed to the board of directors of Delavan in connection with its consideration of the merger, and was directed only to the fairness, from a financial point of view, as of October 13, 2014, of the Per Share Merger Consideration to the holders of Delavan common stock. The opinion did not address the relative merits or risks of: (i) the merger, the Agreement or any other agreements or other matters provided for, or contemplated by, the Agreement; (ii) any other transactions that may be, or might have been, available as an alternative to the merger; or (iii) the merger compared to any other potential alternative transactions or business strategies considered by the Board and, accordingly, Baird relied upon discussions with the senior management of Delavan with respect to the availability and consequences of any alternatives to the merger. The opinion did not constitute a recommendation to the Board, any security holder or any other person as to how any such person should vote or act with respect to the merger.

The followingSet forth below is a summary of the material financial analyses performed by BairdD.A. Davidson in connection with rendering its opinion, whichopinion. The summary of the analyses performed by D.A. Davidson set forth below is qualified in its entirety by reference to the full text of such opinion attached asAnnex D and to the other disclosures contained in this section. The following summary, however, does not purport to be a complete description of the financialanalysis underlying its opinion, and the order in which these analyses performed by Baird. The orderare described below is not indicative of analyses described does not representany relative importanceweight or weightimportance given to thethose analyses performed by Baird. Some D.A. Davidson. The following summaries

of the summaries of the financial analyses include information presented in a tabular format. TheseYou should read these tables must be read together with the full text of eachthe summary andfinancial analyses, as the tables alone are not a complete description of Baird’s financialthe analyses. Except as

Unless otherwise noted,indicated, the following quantitative information, to the extent it is based on market and financialdata, is based on market data as it existed on or before October 13, 2014of June 4, 2019, and is not necessarily indicative of current market conditions.conditions after such date.

Implied Valuation and Transaction Multiples. BasedMultiples for STC based on the Merger Consideration

D.A. Davidson reviewed the financial terms of the proposed transaction. As described in the merger agreement, aggregate consideration to be paid in the merger shall be equal to the product of $100 and the number of shares of STC common stock outstanding subject to adjustment pursuant to the terms of the merger agreement.  Merger consideration is intended to be paid 50% in cash consideration of $50.80 net per share of Delavan Common Stock (the “Per Share Equity Purchase Price”), exchange ratio of 1.16and 50% in shares of Wintrust Common Stockcommon stock, with $2,500,000 of the cash portion of the merger consideration deposited into a special purpose escrow account and $400,000 of the cash portion of the merger consideration deposited into a separate escrow account, which we refer to as the reserve amount.  Each issued and outstanding share of STC common stock of STC shall be converted into the right to receive (i) an amount of cash equal to the merger consideration multiplied by 0.5 minus the escrow amount minus the reserve amount with the resultant divided by the number of shares of STC common stock outstanding; plus (ii) (A) an amount of cash equal to the portion of the escrow amount to be disbursed pursuant to the merger agreement divided by the number of shares of STC common stock outstanding and (B) an amount of cash contained in the reserve account to be disbursed pursuant to the merger agreement divided by the number of shares of STC common stock outstanding; plus (iii) a number of shares of Wintrust common stock equal to the aggregate share amount as defined in the merger agreement divided by the number of shares of STC common stock outstanding multiplied by 0.5.  The terms and conditions of the merger are more fully set forth in the merger agreement.

“Wintrust common stock price” shall mean the mathematical average, calculated for the five trading-day period ending on the second trading day preceding the closing date, of the volume-weighted average price, which we refer to as VWAP, of a share of Wintrust common stock for each trading day during such period as displayed under the heading “Bloomberg VWAP” on the Bloomberg Page for Wintrust (or its equivalent successor page if such page is not available).  If the Bloomberg Page or the Bloomberg VWAP is not available for a trading day, “VWAP” shall mean the volume-weighted average price of a share of Delavan Common Stock (the “Exchange Ratio”)Wintrust common stock for such trading day, as determined by a nationally recognized investment banking firm retained by Wintrust based on available trading information for shares of Wintrust common stock.

For purposes of the financial analyses described below, based on the VWAP on June 3, 2019 of $69.37, the per share merger consideration represented a value of $100.00 per fully diluted share of STC common stock and Wintrust’s stock priceaggregate deal consideration of $43.79$47.7 million. Based upon financial information as of October 10, 2014,or for the implied “Per Share Equity Purchase Price” is $50.80 net per share, Bairdtwelve-month period ended March 31, 2019 and other financial and market information described below, D.A. Davidson calculated the implied “equity purchase price” (definedfollowing transaction ratios:

Transaction Ratios

Aggregate

Transaction Price/ LTM Net Income (1)

26.2x

Transaction Price/ YTD (3/31/2019) Net Income (Annualized) (1)

33.9x

Transaction Price/ 2019 Budgeted Net Income (1) (2)

24.2x

Transaction Price/ 2020 Budgeted Net Income (1) (2)

18.4x

Transaction Price/ Book Value (3/31/2019)

150.8

%

Transaction Price/ Book Value (Per Definitive Agreement) (3)

155.3

%

Transaction Price/ Tangible Book Value (3/31/2019)

150.8

%

Transaction Price / Tangible Book Value (Per Definitive Agreement) (3)

155.3

%

Tangible Book Premium / Core Deposits (3/31/2019) (4)

7.5

%

Tangible Book Premium / Core Deposits (Per Definitive Agreement) (3) (4)

7.9

%


(1)    STC Net Income is tax-adjusted on a C-Corp basis

(2)    Financial projections for STC based on bank-level budget in 2019-2021 and discussed with and confirmed by management in 2022-2024

(3)    Based on Book Value and Tangible Book Value of $30.7 million as an agreed upon minimum TCE requirement as described in the Per Share Equity Purchase Price multipliedDefinitive Agreement

(4)    Tangible Book Premium / Core Deposits calculated by dividing the total number of common shares outstanding of Delavan, including gross shares issuable upon the exercise of stock options, less assumed option proceeds) to be $38 million. Baird then calculated the multiplesexcess or deficit of the Per Share Purchase Priceaggregate transaction value compared to Wintrust’s last twelve month (“LTM”) June 30, 2013 earnings per share (“EPS”) and book value per share and tangible book value per share at June 30, 2013,by core deposits

Stock Price Performance of Wintrust and STC

D.A. Davidson reviewed the history of the reported trading prices and volume of Wintrust common stock and certain stock indices, including the S&P 500, the KBW Nasdaq Regional Bank Index and the NASDAQ Bank Index. D.A. Davidson compared the stock price performance of Wintrust with the performance of the S&P 500, the KBW Nasdaq Regional Banking Index and the NASDAQ Bank Index as provided byfollows:

One Year Stock Performance

 

 

Beginning Index Value
on 6/4/2018

 

Ending Index Value on
6/4/2019

 

S&P 500

 

100.0

%

102.1

%

KBW Nasdaq Regional Banking Index

 

100.0

%

82.2

%

Wintrust

 

100.0

%

77.2

%

Three Year Stock Performance

 

 

Beginning Index Value
on 6/3/2016

 

Ending Index Value on
6/4/2019

 

S&P 500

 

100.0

%

133.5

%

KBW Nasdaq Regional Banking Index

 

100.0

%

118.3

%

NASDAQ Bank

 

100.0

%

125.9

%

Wintrust

 

100.0

%

137.4

%

Five Year Stock Performance

 

 

Beginning Index Value
on 6/4/2014

 

Ending Index Value on
6/4/2019

 

S&P 500

 

100.0

%

145.4

%

KBW Nasdaq Regional Banking Index

 

100.0

%

132.9

%

NASDAQ Bank

 

100.0

%

142.7

%

Wintrust

 

100.0

%

164.5

%

Ten Year Stock Performance

 

 

Beginning Index Value
on 6/4/2009

 

Ending Index Value on
6/4/2019

 

S&P 500

 

100.0

%

297.4

%

KBW Nasdaq Regional Banking Index

 

100.0

%

234.5

%

NASDAQ Bank

 

100.0

%

217.5

%

Wintrust

 

100.0

%

400.6

%

Fifteen Year Stock Performance

 

 

Beginning Index Value
on 6/4/2004

 

Ending Index Value on
6/4/2019

 

S&P 500

 

100.0

%

249.7

%

NASDAQ Bank

 

100.0

%

125.6

%

Wintrust

 

100.0

%

149.5

%

Contribution Analysis

D.A. Davidson analyzed the senior managementrelative contribution of DelavanSTC and Wintrust. These transaction multiplesWintrust to certain financial and operating metrics for the pro forma combined company. Such financial and operating metrics included: (i) STC’s C-Corp adjusted net income for the twelve months ended March 31, 2019 and STC’s C-Corp adjusted budgeted net income

for the twelve months ended December 31, 2019, December 31, 2020 and December 31, 2021 based on STC’s management’s budget; (ii) Wintrust’s net income for the twelve months ended March 31, 2019 and Wintrust’s estimated GAAP net income for the twelve months ended December 31, 2019, December 31, 2020 and December 31, 2021 based on publicly available analyst earnings estimates; (iii) total assets; (iv) total investment securities; (v) gross loans (including loans held for sale); (vi) loan loss reserve; (vii) total deposits; (viii) non-interest bearing demand deposits; (ix) non-maturity deposits; (x) tangible common equity; and (xi) adjusted tangible common equity (per the merger agreement). The relative contribution analysis did not give effect to the impact of any synergies as a result of the proposed merger. The results of this analysis are summarized in the table below.below, which also compares the results of this analysis with the implied pro forma ownership percentages of STC or Wintrust shareholders in the combined company based on the per share merger consideration and an implied per share merger consideration:

Contribution Analysis

 

 

Wintrust
Stand-alone(1)

 

Wintrust
% of Total

 

STC
Stand-alone(2) (3)

 

STC
% of Total

 

 

 

 

 

 

 

 

 

 

 

Income Statement - Historical

 

 

 

 

 

 

 

 

 

LTM Net Income (in thousands)

 

$

350,331

 

99.5

%

$

1,818

 

0.5

%

 

 

 

 

 

 

 

 

 

 

Income Statement - Projections

 

 

 

 

 

 

 

 

 

2019 Wintrust Analyst Estimate / STC Budgeted Net Income (in thousands)

 

$

379,856

 

99.5

%

$

1,966

 

0.5

%

2020 Wintrust Analyst Estimate / STC Budgeted Net Income (in thousands)

 

$

408,224

 

99.4

%

$

2,594

 

0.6

%

2021 Wintrust Analyst Estimate / STC Budgeted Net Income (in thousands)

 

$

437,000

 

99.3

%

$

3,075

 

0.7

%

 

 

 

 

 

 

 

 

 

 

Balance Sheet

 

 

 

 

 

 

 

 

 

Total Assets (in thousands)

 

$

32,358,621

 

99.2

%

$

275,767

 

0.8

%

Total Investment Securities (in thousands)

 

$

3,374,549

 

99.3

%

$

22,882

 

0.7

%

Gross Loans, Incl. Loans HFS (in thousands)

 

$

24,463,186

 

99.2

%

$

204,938

 

0.8

%

Loan Loss Reserve (in thousands)

 

$

158,212

 

98.4

%

$

2,585

 

1.6

%

Total Deposits (in thousands)

 

$

26,804,742

 

99.1

%

$

243,924

 

0.9

%

Non-Interest Bearing Demand Deposits (in thousands)

 

$

6,353,456

 

98.7

%

$

83,821

 

1.3

%

Non-CDs (in thousands)

 

$

21,454,035

 

99.3

%

$

161,895

 

0.7

%

Actual Tangible Common Equity (3/31/2019) (in thousands)

 

$

2,626,748

 

98.8

%

$

31,611

 

1.2

%

Adj. Tangible Common Equity (Per Definitive Agreement) (in thousands) (4)

 

$

2,626,748

 

98.8

%

$

30,700

 

1.2

%

 

 

 

 

 

 

 

 

 

 

Pro Forma Ownership

 

 

 

 

 

 

 

 

 

Pro Forma Ownership Split (at 0.7208x Exchange Ratio)

 

 

 

99.4

%

 

 

0.6

%

Pro Forma Ownership Split in 100% Stock Deal (at 1.4416x Exchange Ratio)

 

 

 

98.9

%

 

 

1.1

%


Note: Pro forma contribution does not include any purchase accounting or merger adjustments

(1) Financial projections for Wintrust based on analyst estimates in 2019-2021

(2) Financial projections for STC based on bank-level budget in 2019-2021

(3) STC Net Income is tax-adjusted on a C-Corp basis

(4) Book Value and Tangible Book Value of $30.7 million is an agreed upon minimum TCE requirement as described in the Definitive Agreement

STC Comparable Companies Analysis

D.A. Davidson used publicly available information to compare selected financial and market trading information for STC and a group of 41 financial institutions selected by D.A. Davidson which: (i) were headquartered in the Midwest; (ii) had their common stock listed on the NYSE, Nasdaq or an over-the-counter exchange; (iii) had assets between $100 million and $500 million; (iv) had a return on average assets greater than 0.00%; and (v) were not pending merger targets. The 41 financial institutions were as follows:

 

AMB Financial Corp.

Andover Bancorp, Inc.

Baraboo Bancorporation, Inc.

Benton Financial Corporation

CCSB Financial Corp.

Central Bank Corporation

Century Financial Corporation

Choice Bancorp, Inc.

CITBA Financial Corporation

Citizens Commerce Bancshares, Inc.

First Bancshares, Inc. (FIBH)

First Bank of Ohio

First Citizens National Bank of Upper Sandusky

First Ottawa Bancshares, Inc.

FNBH Bancorp, Inc.

Grand River Commerce, Inc.

HCB Financial Corp.

HFB Financial Corporation

Huron Valley Bancorp, Inc.

Iowa First Bancshares Corp.

Clarkston Financial Corporation

Comunibanc Corp.

Eastern Michigan Financial Corporation

Edgewater Bancorp, Inc.

Empire Bancshares, Inc.

Equitable Financial Corp.

FCN Banc Corp.

FFD Financial Corporation

FFW Corporation

First Bancorp of Indiana, Inc.

First Bancshares, Inc. (FBSI)

Liberty Bancshares, Inc.

Logansport Financial Corp.

Madison County Financial, Inc.

Northeast Indiana Bancorp, Inc.

Oxford Bank Corporation

SVB&T Corporation

Town Center Bank

University Bancorp, Inc.

Wayne Savings Bancshares, Inc.

West Shore Bank Corporation

The analysis compared the financial condition and market performance of STC and the 41 financial institutions identified above based on publicly available financial and market trading information for STC and the 41 financial institutions as of and for the twelve-month or three-month period ended March 31, 2019. The analysis did not reflect the impact from pending acquisitions or acquisitions closed after March 31, 2019. The table below shows the results of this analysis (excluding the impact of earnings per share multiples considered not meaningful by D.A. Davidson).

Financial Condition and Performance

 

 

 

 

Comparable Companies

 

 

 

STC(2)

 

Median

 

Average

 

Low

 

High

 

Total Assets (in millions)

 

$

276.7

 

$

323.5

 

$

318.3

 

$

101.6

 

$

487.8

 

Non-Performing Assets / Total Assets (1)

 

1.80

%

0.66

%

0.85

%

0.00

%

2.48

%

Tangible Common Equity Ratio

 

11.43

%

10.28

%

11.35

%

7.17

%

37.65

%

Net Interest Margin (LTM)

 

4.01

%

3.68

%

3.71

%

2.94

%

4.44

%

Cost of Deposits (LTM)

 

0.71

%

0.65

%

0.68

%

0.03

%

1.57

%

Non-Interest Income / Assets

 

0.51

%

0.61

%

0.65

%

0.22

%

1.65

%

Efficiency Ratio (LTM)

 

77.49

%

68.70

%

70.33

%

51.25

%

93.63

%

Return on Average Equity (LTM)

 

5.99

%

9.54

%

9.34

%

2.76

%

16.76

%

Return on Average Assets (LTM)

 

0.66

%

1.03

%

1.00

%

0.43

%

1.62

%

Market Performance Multiples

 

 

Comparable Companies

 

 

 

Median

 

Average

 

Low

 

High

 

Market Capitalization (in millions)

 

$

37.0

 

$

35.9

 

$

7.7

 

$

69.8

 

Price Change (LTM)

 

1.9

%

3.8

%

-24.5

%

33.3

%

Price Change (YTD)

 

5.8

%

5.9

%

-13.0

%

31.6

%

Price / LTM Earnings Per Share

 

11.8

x

13.0

x

7.3

x

33.5

x

Price / Tangible Book Value Per Share

 

106.8

%

104.7

%

47.5

%

171.3

%

Tangible Book Premium / Core Deposits (3)

 

0.85

%

-1.30

%

-77.44

%

9.06

%

Dividend Yield (Most Recent Quarter)

 

1.89

%

1.61

%

0.00

%

4.13

%


(1) Non-Performing Assets / Total Assets includes performing troubled debt restructurings (TDRs)

(2) STC Net Income is tax-adjusted on a C-Corp basis

(3) Tangible Book Premium / Core Deposits calculated by dividing the excess or deficit of the aggregate transaction value compared to tangible book value by core deposits

Wintrust Comparable Companies Analysis

D.A. Davidson used publicly available information to compare selected financial and market trading information for Wintrust and a group of 21 financial institutions selected by D.A. Davidson which: (i) were headquartered nationwide; (ii) had their common stock listed on the Nasdaq or NYSE; (iii) had assets between $25.0 billion and $50.0 billion; (iv) had a return on average assets greater than 0.00%; and (iv) were not pending merger targets. These 21 financial institutions were as follows:

Transaction Metric

Associated Banc-Corp

BOK Financial Corporation

Commerce Bancshares, Inc.

Cullen/Frost Bankers, Inc.

East West Bancorp, Inc.

F.N.B. Corporation

First Citizens BancShares, Inc.

First Horizon National Corporation

Hancock Whitney Corporation

IBERIABANK Corporation

PacWest Bancorp

Multiple

People’s United Financial, Inc.

Pinnacle Financial Partners, Inc.

Popular, Inc.

Signature Bank

Sterling Bancorp

Synovus Financial Corp.

Texas Capital Bancshares, Inc.

Umpqua Holdings Corporation

Valley National Bancorp

Webster Financial Corporation

The analysis compared the financial condition and market performance of Wintrust and the 21 financial institutions identified above based on publicly available financial and market trading information for Wintrust and the 21 financial institutions as of and for the twelve-month or three-month period ended March 31, 2019. The analysis also compared the 2019 and 2020 earnings per share multiples for Wintrust and the 21 financial institutions identified above based on publicly available analyst earnings estimates for Wintrust and the 21 financial institutions. The analysis did not reflect the impact from pending acquisitions or acquisitions closed after March 31, 2019. The table below shows the results of this analysis (excluding the impact of earnings per share multiples considered not meaningful by D.A. Davidson).

Financial Condition and Performance

 

 

 

 

Comparable Companies

 

 

 

Wintrust

 

Median

 

Average

 

Low

 

High

 

Total Assets (in millions)

 

$

32,358.6

 

$

32,477.0

 

$

34,910.5

 

$

25,033.5

 

$

48,680.6

 

Non-Performing Assets / Total Assets (1)

 

0.56

%

0.52

%

0.76

%

0.26

%

4.05

%

Tangible Common Equity Ratio

 

8.28

%

8.87

%

8.64

%

6.70

%

11.06

%

Net Interest Margin (LTM)

 

3.65

%

3.57

%

3.61

%

2.87

%

4.94

%

Cost of Deposits (LTM)

 

0.81

%

0.72

%

0.68

%

0.10

%

1.08

%

Non-Interest Income / Assets (LTM)

 

1.18

%

0.87

%

0.88

%

0.05

%

2.00

%

Efficiency Ratio (LTM)

 

61.1

%

55.5

%

53.8

%

35.8

%

64.6

%

Return on Average Equity (LTM)

 

11.03

%

11.32

%

11.44

%

7.63

%

15.89

%

Return on Average Assets (LTM)

 

1.17

%

1.33

%

1.35

%

1.03

%

1.86

%

Market Performance Multiples

 

 

 

 

Comparable Companies

 

 

 

Wintrust

 

Median

 

Average

 

Low

 

High

 

Market Capitalization (in millions)

 

$

4,109

 

$

4,500

 

$

4,744

 

$

3,069

 

$

6,590

 

Price Change (LTM)

 

-22.8

%

-21.3

%

-19.6

%

-39.3

%

16.6

%

Price Change (YTD)

 

9.1

%

13.9

%

11.6

%

-3.4

%

24.2

%

Price / LTM Earnings Per Share

 

12.1

x

10.5

x

11.0

x

7.9

x

15.7

x

Price / 2019 Est. Earnings Per Share (2)

 

10.9

x

10.3

x

10.6

x

8.4

x

16.1

x

Price / 2020 Est. Earnings Per Share (2)

 

10.3

x

9.8

x

10.1

x

8.1

x

15.6

x

Price / Tangible Book Value Per Share

 

156.3

%

160.2

%

166.2

%

110.7

%

237.7

%

Tangible Book Premium / Core Deposits (3)

 

5.85

%

6.82

%

7.82

%

1.33

%

20.14

%

Dividend Yield (Most Recent Quarter)

 

1.38

%

2.71

%

2.86

%

0.00

%

6.32

%


(1) Non-Performing Assets / Total Assets includes performing troubled debt restructurings (TDRs)

(2) Earnings per share estimates based on publicly available consensus street estimates

(3) Tangible Book Premium / Core Deposits calculated by  dividing the excess or deficit of the aggregate transaction value compared to tangible book value by core deposits

Precedent Transactions Analysis

D.A. Davidson reviewed two sets of precedent merger and acquisition transactions. The sets of mergers and acquisitions included: (1) “Illinois Transactions” and (2) “Nationwide Transactions”.

“Illinois Transactions” included 15 transactions where:

·                  the selling company was a bank or thrift headquartered in Illinois;

·                  the selling company’s total assets were between $100 million and $500 million;

·                  the transaction was announced between January 1, 2015 and June 4, 2019;

·                  the selling company’s return on average assets over the last twelve months was greater than 0.00%;

·                  the transaction’s pricing information was publicly available;

·                  the buying company was not an investor group; and

·                  the transaction was not a merger of equals.

“Nationwide Transactions” included 21 transactions where:

·                  the selling company was a bank headquartered in the United States;

·                  the selling company’s total assets were between $100 million and $500 million;

·                  the selling company’s return on average assets over the last twelve months was greater than 0.00%;

·                  the selling company’s tangible common equity ratio was above 10.0%;

·                  the selling company’s NPAs / assets was less than 2.0%;

·                  the transaction was announced between June 4, 2018 and June 4, 2019;

·                  the transaction’s pricing information was publicly available;

·                  the buying company was not an investor group; and

·                  the transaction was not a merger of equals.

The following tables set forth the transactions included in “Illinois Transactions” and “Nationwide Transactions” and are sorted by announcement date:

Illinois Transactions

Announcement Date

Acquirer

Target

Price/LTM EPS2/20/2019

Wintrust Financial Corp.

25.8

Rush-Oak Corporation

Price/Book Value Per Share10/18/2018

Blackhawk Bancorp, Inc.

140.5

First McHenry Corp.

Price/Tangible Book Value Per Share10/17/2018

140.5

Delavan Selected Comparable Delavan Analysis. In choosing comparable companies to analyze, Baird selected a peer group of publicly-traded banks and thrifts operating in the Midwest region of the United States with assets of less than $500 million. The selected comparable companies for Delavan included:

 

Byline Bancorp, Inc.

OPRF Bankshares, Inc.

•   River Valley6/13/2018

Merchants Bancorp

•   UnitedFM Bancorp, Inc.

•   Ameriana Bancorp6/12/2018

•   WolverineFirst Mid-Illinois Bancshares

SCB Bancorp, Inc.

•   2/21/2018

NorthWest Indiana Bancorp

First Capital,Personal Fin. Corp.

12/26/2017

Old Second Bancorp, Inc.

•   JacksonvilleGreater Chicago Fin. Corp.

12/11/2017

First Mid-Illinois Bancshares

First BancTrust Corp.

9/30/2016

United Community Bancorp

Liberty Bancshares, Inc.

•   Poage Bankshare, Inc.7/06/2016

•   Madison CountyWintrust Financial Inc.Corp.

First Comm. Fin. Corp.

•   Wayne Savings Bancshares, Inc.6/08/2016

•   Central FederalUnited Community Bancorp

Illini Corporation

•   Citizens First Corporation9/21/2015

•   First Federal of Northern MichiganMidwest Bancorp, Inc.

Baird chose these companies based on a review of publicly-traded companies that possessed general business, operating and financial characteristics representative of companies in the industry in which Delavan operates. Baird noted that none of the companies reviewed is identical to Delavan and that, accordingly, the analysis of such companies necessarily involves complex considerations and judgments concerning differences in the business, operating and financial characteristics of each such company and other factors that affect the public market values of such companies.

To perform this analysis, Baird used financial information at or for the twelve months ended June 30, 2014, as indicated in the tables below. Market price information was as of October 10, 2014. Certain financial data prepared by Baird, and as referenced in the tables presented below, may not correspond to the data presented in Delavan’s and Wintrust’s historical financial statements, as a result of the different periods, assumptions and methods used by Baird to compute the financial data presented.

Baird’s analysis showed the following concerning Delavan’s financial performance:

Financial Performance Measures(1):

  Delavan  Delavan Peer
Group Median
  Delavan Peer
Group Mean
 

Return on Average Equity

   4.62  6.15  5.50

Return on Average Assets

   0.59  0.57  0.61

Net Interest Margin

   4.33  3.61  3.64

Efficiency Ratio

   65.7    74.6    76.7  

 

(1)Calculated for the twelve month period ended June 30, 2014.

Baird’s analysis showed the following concerning Delavan’s financial condition:

Financial Condition Measures(1):

  Delavan  Delavan Peer
Group Median
  Delavan Peer
Group Mean
 

Total Risk-Based Capital Ratio

   19.26  15.89  17.10

Tangible Equity to Tangible Assets

   13.05  10.34  11.44

Non-Performing Assets to Assets

   1.75  1.56  1.82

Reserves to Loans

   1.56  1.26  1.57

(1)Calculated at June 30, 2014.

Baird’s analysis showed the following concerning Delavan’s market performance, specifically that of its peer average:

Market Performance Measures:

  Delavan   Delavan Peer
Group Median
  Delavan Peer
Group Mean
 

Price to LTM EPS(1)(2)

   NA     13.6x    14.3x  

Price to book value(3)

   NA     92.3  93.2

Price to tangible book value(3)

   NA     95.2  97.1

(1)Calculated based upon the closing stock price as of October 10, 2014 and earnings for the twelve month period ended June 30, 2014.
(2)Delavan Peer Group Median, Maximum and Minimum exclude multiples greater than 50.0x.
(3)Calculated based upon the closing stock price as of October 10, 2014.

Baird then compared the transaction multiples implied in the merger with the corresponding trading multiples for the selected companies. A summary of the implied multiples is provided in the table below.

   Implied Transaction  Peer Group Multiples 

June 30, 2014

  Multiples  Median  Mean 

LTM EPS

   25.8  13.6  14.3

Book Value

   140.5  92.3  93.2

Tangible Book Value

   140.5  95.2  97.1

In addition, Baird calculated the implied equity value per share based on the trading multiples of the selected public companies.

       Implied Equity Value Per Share 

June 30, 2014

  Delavan Per Share   Median   Mean 

LTM EPS

  $3.94    $53.49    $56.33  

Book Value

  $72.97    $67.34    $67.98  

Tangible Book Value

  $72.97    $69.46    $70.87  

Delavan Selected Acquisition Analysis. Baird reviewed certain publicly available financial information concerning completed or pending acquisition transactions that Baird deemed relevant. Baird compiled two groups of selected acquisition transactions. The first group was based on LTM Nationwide deals with target assets between $100 million and $300 million, a tangible common equity to tangible assets ratio of less than 10%, and non-performing assets to assets ratio of less than 3%. The selected Nationwide comparable transactions included:

Target

Acquiror

•   Premier Commercial Bank

•   NewBridge Bancorp

•   Herget Financial Corp.

•   First Busey Corporation

•   TCNB Financial Corp.

•   First Citizens Banc Corp

•   Phoenix Bancorp Inc.

•   Mid Penn Bancorp, Inc.

•   Broward Financial Holdings Inc.

•   Home BancShares, Inc.

•   Santa Clara Valley Bank NA

•   Sierra Bancorp

•   First Capital West Bankshares Inc.

•   Sturm Financial Group, Inc.

•   MBT Bancorp

•   MainSource Financial Group, Inc.

•   Ohio Heritage BancorpInc.

•   Peoples Bancorp, Inc.

•   Southern Heritage3/30/2015

Wintrust Financial Corp.

North Bank

3/19/2015

LINCO Bancshares, Inc.

Community First Bank

3/02/2015

Wintrust Financial Corp.

Community Fin. Shares

Nationwide Transactions

Announcement Date

Acquirer

Target

5/28/2019*

Santa Cruz County Bank

Lighthouse Bank

5/14/2019*

Blue Ridge Bankshares, Inc.

Virginia Community Bnks.

5/09/2019*

Allegheny Bancshares, Inc.

Mount Hope Bnks.

3/05/2019*

BancorpSouth Bank

Summit Fin. Enterprises

3/05/2019*

BancorpSouth Bank

Van Alstyne Fin. Corp.

2/20/2019

Wintrust Financial Corp.

Rush-Oak Corporation

2/05/2019

United Community Banks

First Madison B&T

1/22/2019*

Citizens Community Bancorp

F. & M. Bancorp Tomah

1/16/2019

Glacier Bancorp, Inc.

FNB Bancorp

12/10/2018

BayCom Corp

Uniti Financial Corporation

11/28/2018*

Faciam Holdings, Inc.

Summit Bancshares, Inc.

10/11/2018

First Interstate BancSystem

Community 1st Bank

8/20/2018

Farmers & Merchants Bnc.

Limberlost Bancshares

8/13/2018

•   First

BayCom Corp

Bethlehem Financial Corp.

7/24/2018

Summit Financial Group

Peoples Bankshares, Inc.

7/19/2018

Spirit of Texas Bancshares

Comanche National Corp.

6/21/2018

Citizens Community Bancorp

United Bank

6/20/2018

SB One Bancorp

Enterprise Bank N.J.

6/13/2018

Merchants Bancorp

FM Bancorp, Inc.

•   Riverside Bank6/11/2018

•   Salisbury Bancorp, Inc.CapStar Financial Holdings

Athens Bancshares Corp.

•   Community National Bank6/04/2018

•   TriSummit Bancorp, Inc.

•   Insight BankBusiness First Bancshares

•   First FinancialRichland State Bancorp

•   MidSouth Bank

•   Franklin Financial Network, Inc.

•   Bank of Gassaway

•   Premier Financial Bancorp, Inc.

•   Franklin Security Bancorp Inc.

•   ESSA Bancorp, Inc.

•   SCB Bancorp Inc.

•   Horizon Bancorp


The second group*Indicates the transaction was based on LTM Midwest deals with assets between $100 million and $300 million and a non-performing assets to assets ratiopending as of less than 4%. The selected LTM Midwest comparable transactions included:June 4, 2019

 

Target

Acquiror

•   Herget Financial Corp.

•   First Busey Corporation

•   TCNB Financial Corp.

•   First Citizens Banc Corp

•   Citizens Bank of Ashville Ohio

•   Community Bancshares, Inc.

•   Aslin Group Inc.

•   First Business Financial Services, Inc.

•   Guernsey Bancorp Inc.

•   First Financial Bancorp.

•   North Akron Savings Bank

•   Peoples Bancorp Inc.

•   MBT Bancorp

•   MainSource Financial Group, Inc.

•   Ohio Heritage Bancorp Inc.

•   Peoples Bancorp Inc.

•   Private Bancorp, Inc.

•   Alerus Financial Corporation

•   Peoples Service Co.

•   Southern Missouri Bancorp, Inc.

•   Insight Bank

•   First Financial Bancorp.

•   First Bexley Bank

•   First Financial Bancorp.

•   SCB Bancorp Inc.

•   Horizon Bancorp

•   Eaton National B&TC

•   LCNB Corp.

Baird chose these acquisition transactions based on a review of completed and pending acquisition transactions involving target companies that possessed general business, operating and financial characteristics representative of companies in the industry in which Delavan operates. Baird noted that none of the acquisition transactions or subject target companies reviewed is identical to the merger or Delavan, respectively, and that, accordingly, the analysis of such acquisition transactions necessarily involves complex considerations and judgments concerning differences in the business, operating and financial characteristics of each subject target company and each acquisition transaction and other factors that affect the values implied in such acquisition transactions.

For each transaction Baird calculatedreferred to above, D.A. Davidson compared, among other things, the following implied ratios:

·                  transaction price compared to tangible book value on a per share basis, based on the latest publicly available financial statements of the target company prior to the announcement of the transaction;

·                  transaction price compared to earnings per share for the last twelve months, based on the latest publicly available financial statements of the target company prior to the announcement of the transaction;

·                  tangible book premium to core deposits based on the latest publicly available financial statements of the target company prior to the announcement of the transaction.

D.A. Davidson compared the multiples of each target company’s purchase price per sharethe comparable transaction groups and other operating financial data where relevant to its LTM EPS,the proposed merger multiples and other operating financial data of STC as of or for the 3-month period ended March 31, 2019. The table below sets forth the results of this analysis.

Financial Condition and Performance

 

 

 

 

Illinois

 

Nationwide

 

 

 

STC(2)

 

Median

 

Average

 

Low

 

High

 

Median

 

Average

 

Low

 

High

 

Total Assets (in millions)

 

$

276.7

 

$

211.1

 

$

255.2

 

$

107.9

 

$

465.6

 

$

280.5

 

$

267.3

 

$

114.6

 

$

482.3

 

Return on Average Assets (LTM)

 

0.66

%

0.70

%

0.73

%

0.24

%

1.61

%

1.00

%

1.16

%

0.62

%

2.02

%

Return on Average Equity (LTM)

 

5.99

%

6.06

%

6.77

%

2.87

%

22.20

%

8.41

%

9.79

%

4.18

%

17.47

%

Tangible Common Equity Ratio

 

11.43

%

9.68

%

10.28

%

6.59

%

14.88

%

11.26

%

11.95

%

10.24

%

15.84

%

Core Deposits / Deposits

 

88.4

%

91.6

%

89.9

%

74.6

%

98.1

%

91.4

%

88.0

%

61.9

%

98.8

%

Loans / Deposits

 

84.0

%

69.1

%

69.6

%

27.7

%

97.4

%

79.7

%

78.2

%

33.3

%

122.7

%

Non-Interest Income / Assets

 

0.51

%

0.50

%

0.81

%

0.15

%

4.72

%

0.56

%

0.64

%

0.11

%

1.35

%

Efficiency Ratio (LTM)

 

77.5

%

74.2

%

73.0

%

58.3

%

83.8

%

65.7

%

62.6

%

44.6

%

78.9

%

Non-Performing Assets / Total Assets (1)

 

1.80

%

1.74

%

2.36

%

0.77

%

5.20

%

0.67

%

0.65

%

0.00

%

1.74

%

Loan Loan Reserves / Non-Performing Assets

 

52.0

%

41.9

%

52.2

%

7.1

%

164.4

%

118.7

%

171.0

%

48.2

%

560.4

%

Transaction Multiples

 

 

 

 

Illinois

 

Nationwide

 

 

 

STC(2)

 

Median

 

Average

 

Low

 

High

 

Median

 

Average

 

Low

 

High

 

Transaction Price / Tangible Book Value (Per Share)

 

150.8

%

147.7

%

146.5

%

115.7

%

190.2

%

158.1

%

170.9

%

104.4

%

288.8

%

Transaction Price / LTM EPS

 

26.2

x

25.3

x

25.1

x

7.9

x

37.8

x

18.8

x

19.9

x

11.4

x

36.2

x

Tangible Book Premium / Core Deposits (3) 

 

7.45

%

6.28

%

7.00

%

2.03

%

16.34

%

10.88

%

11.97

%

0.78

%

31.44

%


(1) Non-Performing Assets / Total Assets includes performing troubled debt restructurings (TDRs)

(2) STC Net Income is tax-adjusted on a C-Corp basis

(3) Tangible Book Premium / Core Deposits calculated by dividing the excess or deficit of the aggregate transaction value compared to tangible book value by core deposits

Net Present Value Analysis for STC

D.A. Davidson performed an analysis that estimated the net present value per share of STC common stock under various circumstances. The analysis assumed: (i) STC performed in accordance with STC’s management’s budget for the years ending December 31, 2019, December 31, 2020 and December 31, 2021; and (ii) an estimated long-term growth rate for the years thereafter, as discussed with and confirmed by STC management. To approximate the terminal value of STC common stock at December 31, 2024, D.A. Davidson applied price to earnings multiples ranging from 12.0x to 19.0x and multiples of tangible book value per share. In addition, Baird calculated the core deposit premium of each transaction where core deposit premium is defined as transaction value less tangible book value divided by core deposits. Core deposits are defined as total deposits less time deposits greater than $100,000ranging from 100.0% to 170.0%. The income streams and brokered deposits. Stock market and historical financial information for each selected transaction was based on publicly available information as of the date of each respective transaction. A summary of the implied multiples from each peer group is provided in the table below.

  Nationwide Peer Group       
  Implied Transaction
Multiples
  Selected Delavan
Multiples
 
   Median  Mean 

LTM EPS

  25.8  20.1  20.2

Book Value

  140.5  113.3  121.1

Tangible Book Value

  140.5  113.3  121.6

Core Deposit Premium

  7.2  2.1  3.8
  Midwest Peer Group       
  Implied Transaction
Multiples
  Selected Delavan
Multiples
 
   Median  Mean 

LTM EPS

  25.8  19.1  22.3

Book Value

  140.5  142.2  143.8

Tangible Book Value

  140.5  143.8  144.9

Core Deposit Premium

  7.2  5.8  5.7

In addition, Baird calculated the implied equity value per share based on the acquisition transaction multiples of the selected acquisition transactions for both peer groups, summarized in the tables below.

   Nationwide Peer Group         
   Delavan
Per Share
   Implied Equity Value
Per Share
 
     Median   Mean 

LTM Earnings(1)

  $3.94    $79.17    $79.47  

Book Value(1)

  $72.97    $82.66    $88.34  

Tangible Book Value(1)

  $72.97    $82.66    $88.77  

Core Deposits

  $148.092    $81.39    $87.97  

(1)Delavan per share data as of June 30, 2014.

   Midwest Peer Group         
   Delavan
Per Share
   Implied Equity Value
Per Share
 
     Median   Mean 

LTM Earnings(1)

  $3.94    $75.21    $87.99  

Book Value(1)

  $72.97    $103.79    $104.91  

Tangible Book Value(1)

  $72.97    $104.90    $105.77  

Core Deposits

  $148.092    $95.80    $95.35  

(1)Delavan per share data as of June 30, 2014.

Delavan Discounted Dividend Analysis.Baird performed aterminal values were then discounted dividend analysis to estimate a range of implied equity value per share for Delavan. In this analysis, Baird assumedpresent values using different discount rates ranging from 10.0%11.46% to 14.0%17.46% chosen to derive: (i)reflect different assumptions regarding required rates of return of holders or prospective buyers of STC common stock. In evaluating the present valuediscount rate, D.A. Davidson used industry standard methods of adding the estimated dividends that Delavan could generate over the five year period beginning December 2015 and ending December 2019, including certain expenses and synergies forecasted as a result of the merger, and assuming excess capital generated at time zero after a target tangible common equity to tangible asset ratio of 9.0% and (ii) the present value of Delavan’s terminal value calculated in year five. Terminal values for Delavan were calculatedcurrent risk-free rate, which is based on a rangethe 10-year Treasury yield, plus the published Duff & Phelps Industry Equity Risk Premium and plus the published Duff & Phelps Size Premium.

At the June 5, 2019 STC board of 10.0x to 18.0x estimated Delavan earnings fordirectors meeting, D.A. Davidson noted that the twelve months ending December 31, 2019. Based on these assumptions, Baird derived a range of implied equitynet present value per share from $73.40 to $116.31.

The discounted dividend analysis is a widely used valuation methodology, but the results of such methodology are highly dependent onupon the numerous assumptions that must be made, including earnings growth rates, terminal values, and discount rates. The analysis didthe results thereof are not purport to benecessarily indicative of the actual values or expectedfuture results.

As illustrated in the following tables, the analysis indicates an imputed range of values per share of Delavan.STC common stock of $50.29 to $107.70 when applying the price to earnings multiples to the financial forecasts and $52.92 to $121.68 when applying the multiples of tangible book value to the financial forecasts.

Earnings Per Share Multiples

 

 

Earnings Per Share Multiple

 

Discount Rate

 

12.0x

 

13.0x

 

14.0x

 

15.0x

 

16.0x

 

17.0x

 

18.0x

 

19.0x

 

11.46%

 

$

68.02

 

$

73.69

 

$

79.35

 

$

85.02

 

$

90.69

 

$

96.36

 

$

102.03

 

$

107.70

 

12.46%

 

$

64.61

 

$

69.99

 

$

75.38

 

$

80.76

 

$

86.14

 

$

91.53

 

$

96.91

 

$

102.30

 

13.46%

 

$

61.40

 

$

66.51

 

$

71.63

 

$

76.75

 

$

81.86

 

$

86.98

 

$

92.10

 

$

97.21

 

14.46%

 

$

58.37

 

$

63.24

 

$

68.10

 

$

72.96

 

$

77.83

 

$

82.69

 

$

87.56

 

$

92.42

 

15.46%

 

$

55.52

 

$

60.15

 

$

64.77

 

$

69.40

 

$

74.03

 

$

78.65

 

$

83.28

 

$

87.91

 

16.46%

 

$

52.83

 

$

57.23

 

$

61.63

 

$

66.04

 

$

70.44

 

$

74.84

 

$

79.24

 

$

83.65

 

17.46%

 

$

50.29

 

$

54.48

 

$

58.67

 

$

62.86

 

$

67.05

 

$

71.25

 

$

75.44

 

$

79.63

 

Tangible Book Value Multiples

 

 

Tangible Book Value Per Share Multiple

 

Discount Rate

 

100.0%

 

110.0%

 

120.0%

 

130.0%

 

140.0%

 

150.0%

 

160.0%

 

170.0%

 

11.46%

 

$

71.58

 

$

78.74

 

$

85.89

 

$

93.05

 

$

100.21

 

$

107.37

 

$

114.53

 

$

121.68

 

12.46%

 

$

67.99

 

$

74.79

 

$

81.59

 

$

88.39

 

$

95.19

 

$

101.99

 

$

108.78

 

$

115.58

 

13.46%

 

$

64.61

 

$

71.07

 

$

77.53

 

$

83.99

 

$

90.46

 

$

96.92

 

$

103.38

 

$

109.84

 

14.46%

 

$

61.43

 

$

67.57

 

$

73.71

 

$

79.86

 

$

86.00

 

$

92.14

 

$

98.28

 

$

104.43

 

15.46%

 

$

58.43

 

$

64.27

 

$

70.11

 

$

75.95

 

$

81.80

 

$

87.64

 

$

93.48

 

$

99.32

 

16.46%

 

$

55.60

 

$

61.15

 

$

66.71

 

$

72.27

 

$

77.83

 

$

83.39

 

$

88.95

 

$

94.51

 

17.46%

 

$

52.92

 

$

58.22

 

$

63.51

 

$

68.80

 

$

74.09

 

$

79.39

 

$

84.68

 

$

89.97

 

D.A. Davidson also considered and discussed with the STC board of directors how this analysis would be affected by changes in the underlying assumptions, including variations with respect to net income. To illustrate this impact, D.A. Davidson performed a similar analysis assuming STC estimated earnings per share in 2024 varied from 20.00% above projections to 20.00% below projections. This analysis resulted in the following range of per share values for STC common stock, using the same price to earnings multiples of 12.0x to 19.0x and a discount rate of 14.46%.

Variance to

 

Earnings Per Share Multiple

 

2024 EPS

 

12.0x

 

13.0x

 

14.0x

 

15.0x

 

16.0x

 

17.0x

 

18.0x

 

19.0x

 

20.00%

 

$

70.05

 

$

75.88

 

$

81.72

 

$

87.56

 

$

93.39

 

$

99.23

 

$

105.07

 

$

110.91

 

15.00%

 

$

67.13

 

$

72.72

 

$

78.31

 

$

83.91

 

$

89.50

 

$

95.10

 

$

100.69

 

$

106.28

 

10.00%

 

$

64.21

 

$

69.56

 

$

74.91

 

$

80.26

 

$

85.61

 

$

90.96

 

$

96.31

 

$

101.66

 

  5.00%

 

$

61.29

 

$

66.40

 

$

71.50

 

$

76.61

 

$

81.72

 

$

86.83

 

$

91.93

 

$

97.04

 

  0.00%

 

$

58.37

 

$

63.24

 

$

68.10

 

$

72.96

 

$

77.83

 

$

82.69

 

$

87.56

 

$

92.42

 

 -5.00%

 

$

55.45

 

$

60.07

 

$

64.69

 

$

69.32

 

$

73.94

 

$

78.56

 

$

83.18

 

$

87.80

 

-10.00%

 

$

52.53

 

$

56.91

 

$

61.29

 

$

65.67

 

$

70.05

 

$

74.42

 

$

78.80

 

$

83.18

 

-15.00%

 

$

49.62

 

$

53.75

 

$

57.88

 

$

62.02

 

$

66.15

 

$

70.29

 

$

74.42

 

$

78.56

 

-20.00%

 

$

46.70

 

$

50.59

 

$

54.48

 

$

58.37

 

$

62.26

 

$

66.15

 

$

70.05

 

$

73.94

 

Delavan Valuation SummaryIllustrative Net Present Value Analysis for Pro Forma STC and Wintrust. A summary

For illustrative purposes, D.A. Davidson performed an analysis that estimated the net present value per share of STC common stock if reinvested in Wintrust, under various circumstances, including the impact of the three valuation analyses of Delavan presented above is providedmerger with Wintrust. The analysis assumed (i) STC performed in the table below.

   Mean   Median   Low   High 

Selected Delavan Analysis

  $65.06    $63.43    $37.77    $86.91  

Selected Acquisition Analysis: Nationwide

  $85.53    $81.50    $52.80    $123.64  

Selected Acquisition Analysis: Midwest

  $99.56    $94.63    $57.57    $179.96  

Discounted Dividend Analysis

  $93.29    $93.16    $73.40    $116.31  

Wintrust Stock Price and Trading Activity. In order to assess the relative public market valuation of the Wintrust’s common stock to be used as consideration in the merger, Baird reviewed the historical stock prices, historical trading activity and public equity research of Wintrust. In considering the historical price and trading activity of Wintrust’s common stock, Baird noted that the high, low and average closing pricesaccordance with management’s budget for the Wintrust’s common stock were $49.62, $41.59,years ending December 31, 2019, December 31, 2020 and $45.58, respectively overDecember 31, 2021, (ii) an estimated long-term growth rate for the last twelve monthsyears thereafter, as discussed with and $49.62, $25.74,confirmed by STC; and $39.01, respectively, over the last three years. Baird also noted that the Wintrust’s common stock price rose 5.29% over the last twelve months and rose 56.23% over the last three years.

Wintrust Selected Publicly Traded Delavan Analysis. In order to assess the relative public market valuation of the Wintrust’s common stock to be used as consideration in the merger, Baird reviewed certain publicly available financial information for certain publicly traded companies that Baird deemed relevant. The selected comparable companies for Wintrust included:

•   FirstMerit Corporation

•   Signature Bank

•   First Horizon National Corporation

•   Commerce Bancshares, Inc.

•   First Citizens BancShares, Inc.

•   Umpqua Holdings Corporation

•   Webster Financial Corporation

•   Prosperity Bancshares, Inc.

•   Hancock Holding Delavan

•   TCF Financial Corporation

•   Susquehanna Bancshares, Inc.

•   Fulton Financial Corporation

•   BankUnited, Inc.

•   Valley National Bancorp

•   PacWest Bancorp

•   F.N.B Corporation

•   UMB Financial Corporation

•   IBERIABANK Corporation

Contribution Analysis. Baird analyzed Wintrust and Delavan’s relative contribution to the combined company in terms of loans, deposits, tangible equity, tangible common stock, LTM earnings, 2013 earnings, expected 2014 earnings, pro forma 2015 earning, and pro forma diluted ownership. For this analysis, Bard assumed that Delavan shareholders would receive 100% stock in the transaction for comparative purposes; as a result Delavan shareholders would own the equivalent of 1.7% of(iii) the pro forma outstanding Wintrust common stock. Wintrust’s and Delavan’s relative contributions to the combined company are summarized in the table below.

Category

  Wintrust  Delavan 

Loans

   99.1  0.9

Deposits

   98.9  1.1

Tangible Equity

   98.6  1.4

Tangible Common Equity

   98.2  1.8

LTM Earnings

   99.0  1.0

2013 Earnings

   99.2  0.8

2014E Earnings

   99.0  1.0

2015E PF Earnings

   98.7  1.3

Pro Forma Diluted Ownership

   98.3  1.7

Pro Forma Merger Analysis. Baird analyzed the estimated financial impact of the merger with Wintrust including the cost savings estimates, purchase accounting adjustments and transaction expenses, as discussed with and confirmed by STC. The analysis also assumed (i) Wintrust performed in accordance with publicly available analyst earnings estimates for the years ending December 31, 2019, December 31, 2020 and December 31, 2021, and (ii) an estimated long-term growth rate for the years thereafter. To approximate the terminal value of Wintrust common stock at December 31, 2024, D.A. Davidson applied price to earnings multiples of 10.0x to 17.0x and multiples of tangible book value ranging from 100.0% to 240.0%. The income streams and terminal values were then discounted to present values using different discount rates ranging from 7.40% to 13.40% chosen to reflect different assumptions regarding required rates of return of holders or prospective buyers of Wintrust common stock. In evaluating the discount rate, D.A. Davidson used industry standard methods of adding the current risk-free rate, which is based on

the 10-year Treasury yield, plus the published Duff & Phelps Industry Equity Risk Premium and plus the published Duff & Phelps Size Premium.

At the June 5, 2019 STC board of directors meeting, D.A. Davidson noted that the net present value analysis is a widely used valuation methodology, but the results of such methodology are highly dependent upon the numerous assumptions that must be made, and the results thereof are not necessarily indicative of actual values or future results.

As illustrated in the following tables, the analysis indicates an imputed range of values per share of STC common stock of $48.65 to $107.81 when applying the price to earnings multiples to the financial forecasts and $45.98 to $141.16 when applying the multiples of tangible book value to the financial forecasts.

Earnings Per Share Multiples

 

 

Earnings Per Share Multiple

 

Discount Rate

 

10.0x

 

11.0x

 

12.0x

 

13.0x

 

14.0x

 

15.0x

 

16.0x

 

17.0x

 

  7.40%

 

$

65.72

 

$

71.73

 

$

77.75

 

$

83.76

 

$

89.77

 

$

95.78

 

$

101.79

 

$

107.81

 

  8.40%

 

$

62.43

 

$

68.13

 

$

73.83

 

$

79.53

 

$

85.23

 

$

90.92

 

$

96.62

 

$

102.32

 

  9.40%

 

$

59.33

 

$

64.73

 

$

70.14

 

$

75.55

 

$

80.95

 

$

86.36

 

$

91.76

 

$

97.17

 

10.40%

 

$

56.41

 

$

61.54

 

$

66.67

 

$

71.80

 

$

76.93

 

$

82.06

 

$

87.19

 

$

92.32

 

11.40%

 

$

53.67

 

$

58.54

 

$

63.41

 

$

68.28

 

$

73.15

 

$

78.02

 

$

82.89

 

$

87.76

 

12.40%

 

$

51.08

 

$

55.71

 

$

60.33

 

$

64.96

 

$

69.59

 

$

74.21

 

$

78.84

 

$

83.46

 

13.40%

 

$

48.65

 

$

53.04

 

$

57.44

 

$

61.83

 

$

66.23

 

$

70.63

 

$

75.02

 

$

79.42

 

Tangible Book Value Multiples

 

 

Tangible Book Value Per Share Multiple

 

Discount Rate

 

100.0%

 

120.0%

 

140.0%

 

160.0%

 

180.0%

 

200.0%

 

220.0%

 

240.0%

 

  7.40%

 

$

62.08

 

$

73.38

 

$

84.68

 

$

95.97

 

$

107.27

 

$

118.56

 

$

129.86

 

$

141.16

 

  8.40%

 

$

58.98

 

$

69.69

 

$

80.39

 

$

91.10

 

$

101.81

 

$

112.52

 

$

123.23

 

$

133.94

 

  9.40%

 

$

56.06

 

$

66.21

 

$

76.37

 

$

86.53

 

$

96.69

 

$

106.84

 

$

117.00

 

$

127.16

 

10.40%

 

$

53.31

 

$

62.95

 

$

72.58

 

$

82.22

 

$

91.86

 

$

101.50

 

$

111.14

 

$

120.78

 

11.40%

 

$

50.72

 

$

59.87

 

$

69.02

 

$

78.17

 

$

87.32

 

$

96.47

 

$

105.63

 

$

114.78

 

12.40%

 

$

48.28

 

$

56.97

 

$

65.67

 

$

74.36

 

$

83.05

 

$

91.74

 

$

100.43

 

$

109.13

 

13.40%

 

$

45.98

 

$

54.24

 

$

62.50

 

$

70.76

 

$

79.02

 

$

87.28

 

$

95.54

 

$

103.80

 

D.A. Davidson also considered and discussed with the STC board of directors how this analysis would be affected by changes in the underlying assumptions, including variations with respect to net income. To illustrate this impact, D.A. Davidson performed a similar analysis assuming Wintrust’s 2015 and 2016pro forma estimated diluted earnings per share. For Wintrust, Baird used Wintrust earnings projections based on consensus estimates of diluted earnings per share in 2024 varied from 20.00% above projections to 20.00% below projections. This analysis resulted in the following range of per share values for 2015STC common stock using the same price to earnings multiples of 10.0x to 17.0x, and 2016. For Delavan, Bairdusing a discount rate of 10.40%.

Variance to

 

Earnings Per Share Multiple

 

2024 EPS

 

10.0x

 

11.0x

 

12.0x

 

13.0x

 

14.0x

 

15.0x

 

16.0x

 

17.0x

 

 20.00%

 

$

66.67

 

$

72.83

 

$

78.98

 

$

85.14

 

$

91.30

 

$

97.45

 

$

103.61

 

$

109.76

 

 15.00%

 

$

64.11

 

$

70.01

 

$

75.91

 

$

81.81

 

$

87.71

 

$

93.60

 

$

99.50

 

$

105.40

 

 10.00%

 

$

61.54

 

$

67.19

 

$

72.83

 

$

78.47

 

$

84.11

 

$

89.76

 

$

95.40

 

$

101.04

 

   5.00%

 

$

58.98

 

$

64.36

 

$

69.75

 

$

75.14

 

$

80.52

 

$

85.91

 

$

91.30

 

$

96.68

 

   0.00%

 

$

56.41

 

$

61.54

 

$

66.67

 

$

71.80

 

$

76.93

 

$

82.06

 

$

87.19

 

$

92.32

 

  -5.00%

 

$

53.85

 

$

58.72

 

$

63.59

 

$

68.47

 

$

73.34

 

$

78.21

 

$

83.09

 

$

87.96

 

-10.00%

 

$

51.28

 

$

55.90

 

$

60.52

 

$

65.13

 

$

69.75

 

$

74.37

 

$

78.98

 

$

83.60

 

-15.00%

 

$

48.72

 

$

53.08

 

$

57.44

 

$

61.80

 

$

66.16

 

$

70.52

 

$

74.88

 

$

79.24

 

-20.00%

 

$

46.15

 

$

50.26

 

$

54.36

 

$

58.46

 

$

62.57

 

$

66.67

 

$

70.78

 

$

74.88

 

Financial Impact Analysis

D.A. Davidson performed pro forma merger analyses that combined projected income statement and balance sheet information of STC and Wintrust. Assumptions regarding the accounting treatment, acquisition adjustments and cost savings were used earnings projections based on Delavan guidance. In addition, Baird assumed thatto calculate the merger will result in cost synergies to Wintrust. Based on its analysis, Baird determinedfinancial impact that the merger would have on certain projected financial results of Wintrust. In the course of this analysis, D.A. Davidson used the publicly available analyst earnings estimates

for Wintrust for the years ending December 31, 2019, December 31, 2020 and December 31, 2021, and used management’s budget for STC for the years ending December 31, 2019, December 31, 2020 and December 31, 2021 provided by STC management. This analysis indicated that the merger is expected to be accretive to Wintrust’s common stock.

Furthermore, theestimated earnings per share beginning in 2020, after excluding non-recurring transaction-related expenses. The analysis also indicated that Wintrust’s Leverage Ratio, Tier 1 Risk-Based Capital Ratiothe merger is expected to be dilutive to tangible book value per share for Wintrust and Total Risk-Based Capital Ratiothat Wintrust would all remain above regulatory minimumsmaintain capital ratios in excess of those required for well capitalized institutions.Wintrust to be considered well-capitalized under existing regulations. For all of the above analysis,analyses, the actual results achieved by STC and Wintrust prior to and following the merger maywill vary from the projected results, and the variations may be material.

Other Analyses. Baird reviewed

D.A. Davidson prepared its analyses for purposes of providing its opinion to STC’s board of directors as to the relativefairness, from a financial point of view, of the per share merger consideration to the holders of STC common stock in the proposed merger and market performanceto assist STC’s board of Delavan and Wintrust to a variety of relevant industry peer groups and indices. Baird also reviewed earnings estimates, balance sheet composition, historical stock performance and other financial data for Delavan.

directors in analyzing the proposed merger. The foregoing summary doesanalyses do not purport to be a complete descriptionappraisals or necessarily reflect the prices at which businesses or securities actually may be sold. Analyses based upon forecasts of the analyses performed by Baird or its presentations to Delavan’s board of directors. The preparation of financial analyses and a fairness opinion is a complex process and is not necessarily susceptible to partial analyses or summary description. Baird believes that its analyses (and the summary set forth above) must be considered as a whole and that selecting portions of such analyses and factors considered by Baird, without considering all of such analyses and factors, could create an incomplete view of the processes and judgments underlying the analyses performed and conclusions reached by Baird and its opinion. Baird did not attempt to assign specific weights to particular analyses. Any estimates contained in Baird’s analysesfuture results are not necessarily indicative of actual values,future results, which may be significantly more or less favorable than as set forth therein. Estimates of values of companies do not purport to be appraisals or necessarily to reflect the prices at which companies may actually be sold.those suggested by these analyses. Because such estimatesthese analyses are inherently subject to uncertainty, Baird doesbeing based upon numerous factors or events beyond the control of the parties and their respective advisors, none of STC, Wintrust or D.A. Davidson or any other person assumes responsibility if future results are materially different from those forecasted.

D.A. Davidson’s opinion was one of many factors considered by STC’s board of directors in its evaluation of the merger and should not assume responsibility for their accuracy.be viewed as determinative of the views of the board of directors of STC or management with respect to the merger or the per share merger consideration.

As

D.A. Davidson and its affiliates, as part of itstheir investment banking business, Baird isare continually engaged in the evaluation ofperforming financial analyses with respect to businesses and their securities in connection with mergers and acquisitions, negotiated underwritings, competitive biddings, secondary distributions of listed and unlisted securities, private placements and valuationsother transactions. D.A. Davidson acted as financial advisor to STC in connection with, and participated in certain parts of the negotiations leading to the merger. D.A. Davidson is a full service securities firm engaged, either directly or through its affiliates, in securities trading, investment management, financial planning and benefits counseling, financing and brokerage activities for estate, corporateboth companies and other purposes. Pursuantindividuals. In the ordinary course of these activities, D.A. Davidson and its affiliates may provide such services to an engagement letter with Delavan dated April 29, 2014, Baird will receiveSTC, Wintrust and their respective affiliates, may actively trade the debt and equity securities (or related derivative securities) of STC and Wintrust for their own account and for the accounts of their customers and may at any time hold long and short positions of such securities. STC selected D.A. Davidson as its financial advisor because it is a transaction fee of approximately $475,000 for its services, a significant portion of which is contingent upon the consummation ofrecognized investment banking firm that has substantial experience in transactions similar to the merger. Pursuant to sucha letter agreement executed on October 22, 2018, STC engaged D.A. Davidson as its financial advisor in connection with the contemplated transaction. Pursuant to the terms of the engagement letter, DelavanSTC agreed to pay D.A. Davidson a cash fee of $50,000 concurrently with the rendering of its opinion. STC will pay to D.A. Davidson at the time of closing of the merger a contingent cash fee equal to 1.00% of the aggregate consideration. STC has also agreed to pay Baird a feereimburse D.A. Davidson for all reasonable out-of-pocket expenses, including fees of $100,000 payable upon delivery of its fairness opinion, regardless of the conclusions reached in such opinion (such fee to be credited against the merger described above). In addition, Delavan has agreedcounsel, and to indemnify BairdD.A. Davidson and certain related persons against certainspecified liabilities, that may arise out of its engagement, including liabilities under the federal securities laws. Baird willlaws, relating to or arising out of its engagement. D.A. Davidson may provide investment banking services to the combined company in the future and may receive future compensation.

Certain unaudited prospective financial information of STC

Wintrust and STC do not receiveas a matter of course make public projections as to future performance, revenues, earnings or other financial results due to, among other reasons, the inherent uncertainty of the underlying assumptions and estimates. However, Wintrust and STC are including in this proxy statement/prospectus certain unaudited prospective financial information that STC made available to D.A. Davidson, in its capacity as STC’s financial advisor. The inclusion of this information should not be regarded as an indication that any of Wintrust, STC, D.A. Davidson, their respective representatives or any other recipient of this information considered, or now considers, it to be necessarily predictive of actual future results or that it should be construed as financial guidance, and it should not be relied on as such.

The following unaudited financial information was prepared solely for internal use and is subjective in many respects. The unaudited prospective financial information reflects numerous estimates and assumptions made with respect to business, economic, market, competitive, regulatory and financial conditions and matters specific to STC’s business, all of which are difficult to predict and many of which are beyond STC’s control. The unaudited prospective financial information reflects both assumptions as to certain business decisions that are subject to change and, in many respects, subjective judgment, and thus is susceptible to multiple interpretations and periodic revisions based on actual experience and business developments. Neither Wintrust nor STC can give any assurance that the unaudited prospective financial information and the underlying estimates and assumptions will be realized. In addition, since the unaudited prospective financial information covers multiple years, such information by its nature becomes less predictive with each successive year. Actual results may differ materially from those set forth below, and important factors that may affect actual results and cause the unaudited prospective financial information to be inaccurate include, but are not limited to, risks and uncertainties relating to STC’s and, if the merger is completed, Wintrust’s respective businesses, industry performance, general business and economic conditions, customer requirements, competition and adverse changes in applicable laws, regulations or rules. For other factors that could cause actual results to differ, please see the sections entitled “Special Notes Concerning Forward-Looking Statements” and “Risk Factors.”

The unaudited prospective financial information was not prepared with a view toward public disclosure, nor was it prepared with a view toward compliance with GAAP, published guidelines of the SEC or the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of prospective financial information. In addition, the unaudited prospective financial information requires significant paymentestimates and assumptions that make it inherently less comparable to the similarly titled GAAP measures in STC’s historical GAAP financial statements. Neither Wintrust’s nor STC’s independent registered public accounting firm, nor any other independent accountants, have compiled, examined or performed any procedures with respect to the unaudited prospective financial information contained herein, nor have they expressed any opinion or any other form of compensation contingent uponassurance on such information or its achievability. The independent registered public accountant reports incorporated by reference into this proxy statement/prospectus relate solely to historical financial information of Wintrust. They do not extend to the successful completionunaudited prospective financial information of STC and should not be read to do so.

                Furthermore, the unaudited prospective financial information does not take into account any circumstances or events occurring after the date it was prepared. STC cannot give any assurance that, had the unaudited prospective financial information been prepared as of the date of this proxy statement/prospectus, similar estimates and assumptions would be used. Neither Wintrust nor STC intends to, and each disclaims any obligation to, make publicly available any update or other revision to the unaudited prospective financial information of STC to reflect circumstances existing since their preparation or to reflect the occurrence of unanticipated events, even in the event that any or all of the underlying assumptions are shown to be in error, or to reflect changes in general economic or industry conditions. The unaudited prospective financial information does not take into account the possible financial and other effects on STC of the merger and does not attempt to predict or suggest future results of the combined company. The unaudited prospective financial information of STC does not give effect to the impact of negotiating or executing the merger agreement, the expenses that may be incurred in connection with completing the merger, the potential synergies that may be achieved by the combined company as a result of the merger, the effect of any business or strategic decision or action that has been or will be taken as a result of the merger agreement having been executed, or the effect on STC of any business or strategic decisions or actions that would likely have been taken if the merger agreement had not been executed, but which were instead altered, accelerated, postponed or not taken in anticipation of the merger. DuringFurther, the last two years, neither Baird norunaudited prospective financial information does not take into account the effect on STC of any possible failure of itsthe merger to occur. None of Wintrust, STC, D.A. Davidson or their respective affiliates, have providedofficers, directors, advisors or other representatives has made, makes or is authorized in the future to make any other investment banking and/or financial advisory servicesrepresentation to either Delavan orany shareholder of Wintrust or any affiliates thereof, for which Baird received (or will receive) compensation.

Baird is a full service securities firm. As such,STC or other person regarding STC’s or the combined company’s ultimate performance compared to the information contained in the ordinary courseunaudited prospective financial information of its business, Baird may from timeSTC or that the projected results will be achieved.

The inclusion of the unaudited prospective financial information of STC herein should not be deemed an admission or representation by Wintrust or STC that such information is viewed as material information of Wintrust or STC, respectively, particularly in light of the inherent risks and uncertainties associated with such information.

In light of the foregoing, and considering that the STC special meeting will be held several months after the unaudited prospective financial information was prepared, as well as the uncertainties inherent in any forecasted information, STC shareholders are cautioned not to time trade the securitiesplace unwarranted reliance on such information, and all STC shareholders are urged to review Wintrust’s most recent SEC filings for a description of Delavan or Wintrust for its own account or the accountsWintrust’s reported financial results. See “Where You Can Find More Information.”

STC Unaudited Prospective Financial Information(1)

 

 

2019

 

2020

 

2021

 

Non-Interest Expense (in thousands)

 

$

8,984

 

$

9,420

 

$

9,810

 

Net Income S-Corp (in thousands)

 

$

2,897

 

$

3,801

 

$

4,492

 

Total Assets (in thousands)

 

$

303,046

 

$

330,933

 

$

362,019

 

Total Stockholders’ Equity (in thousands)

 

$

31,034

 

$

33,835

 

$

37,327

 


(1) Years are January 1 through December 31 of its customerseach year and accordingly, mayrepresents bank-level information at any time hold long or short positions or effect transactions in such securities. Baird may also prepare equity analyst research reports from time to time regarding Delavan or Wintrust.STC Capital Bank

Delavan’sSTC’s reasons for the merger and recommendation of the board of directors

Delavan’s

STC’s board of directors has concluded that the merger offers Delavan’sSTC’s shareholders an attractive opportunity to achieve the board’s strategic business objectives, including increasing shareholder value, growing the size of the business and enhancing liquidity for Delavan’sSTC’s shareholders. In addition, Delavan’sSTC’s board of directors believes that the customers and communities served by CommunitySTC Bank will benefit from the merger.

In deciding to approve the merger agreement and the transactions contemplated thereby, Delavan’sSTC’s board of directors consulted with Delavan’sSTC’s management, as well as its legal counsel and financial advisor, and considered numerous factors, including the following:

·information with respect to the businesses, earnings, operations, financial condition, prospects, capital levels and asset quality of DelavanSTC, Wintrust and Wintrust, both individually and as a combinedthe surviving company;

·the perceived risks and uncertainties attendant to Delavan’sSTC’s operation as an independent banking organization, including the risks and uncertainties related to the continuing low-interest rate environment, competition in Delavan’sSTC’s market area, increased regulatory costs and increased capital requirements;

 

·based on the closing price of Wintrust common stock on October 10, 2014June 3, 2019 and Delavan’s June 30, 2014STC’s March 31, 2019 unaudited balance sheet, the aggregate merger considerationtransaction was priced at a multiple of 1.41.508 times the tangible common book value and at a multiple of 1.41.508 times the common book value;

 

Baird’s

·                                          D.A. Davidson’s opinion, subject to the various assumptions, qualifications and limitations set forth in such fairness opinion, that the per share merger consideration is fair, from a financial point of view, to the holders of DelavanSTC common stock;

 

·the value to be received by Delavan’sSTC’s shareholders in the merger as compared to shareholder value projected for DelavanSTC as an independent entity;

 

·the market value of Wintrust common stock prior to the execution of the merger agreement and the prospects for future appreciation as a result of Wintrust’s strategic initiatives;

 

·Wintrust’s strategy to seek profitable future expansion in Delavan’sSTC’s trade area, leading to continued growth in overall shareholder value;

 

·the fact that Wintrust is publicly held and the merger would provide access to a public trading market for Delavan’sSTC’s shareholders whose investments currently are in a privately held company, as well as enhanced access to capital markets to finance the combinedsurviving company’s capital requirements; and

 

·the likelihood that the merger will be approved by the relevant bank regulatory authorities without undue burden and in a timely manner.

The above discussion of the information and factors considered by Delavan’sSTC’s board of directors is not intended to be exhaustive, but includes a description of all material factors considered by Delavan’sSTC’s board. In view of the wide variety of factors considered by the DelavanSTC board of directors in connection with its evaluation of the merger, the DelavanSTC board did not consider it practical to, nor did it attempt to, quantify, rank or otherwise assign relative weights to the specific factors that it considered. In considering the factors described above, individual directors may have given differing weights to different factors. Delavan’sSTC’s board of directors collectively made its determination with respect to the merger based on the conclusion reached by its members, based on the factors that each of them considered appropriate, that the merger is in the best interests of Delavan’sSTC’s shareholders.

Delavan’s

STC’s board of directors believes that the merger is fair to, and in the best interests of, DelavanSTC and its shareholders. Delavan’sSTC’s board of directors unanimously approved the merger agreement and recommends that shareholders vote “FOR” approval of the merger agreement.

Certain directors and officers of DelavanSTC and CommunitySTC Bank have interests in the merger different from or in addition to their interests as shareholders generally, including certain cash payments that will be made as a result of the merger under various benefit plans and agreements currently in place in order to terminate such agreements and to be made under the agreementagreements entered into between Michael J. MurphyChristopher Woelffer and CommunitySt. Charles Bank & Trust Company and among Jodi Ariss, St. Charles Bank & Trust Company and STC Bank in connection with the merger. You may wish to consider these interests in evaluating Delavan’sSTC’s board of directors’ recommendation that you vote in favor of the merger. See “The Merger—Interests of certain persons in the merger.” AllCertain of Delavan’sSTC’s directors who own shares of DelavanSTC common stock have agreed to vote their shares at the special meeting in favor of the merger and any other matter necessary for consummation of the transactions contemplated by the merger agreement.

Wintrust’s reasons for the merger

Wintrust’s board of directors believes that the merger is in the best interests of Wintrust and its shareholders. In deciding to approve the merger, Wintrust’s board of directors considered a number of factors, including:

 

·management’s view that the acquisition provides an attractive opportunity for Wintrust to expand in southeastern Wisconsin;

the western suburbs of the Chicago metropolitan area;

 

Delavan’s

·                                          STC’s community banking orientation and its compatibility with Wintrust and its subsidiaries;

 

·a review of the demographic, economic and financial characteristics of the markets in which DelavanSTC operates, including existing and potential competition and history of the market areas with respect to financial institutions;

 

·management’s review of Delavan’sSTC’s business, operations, earnings and financial condition, including capital levels and asset quality of CommunitySTC Bank;

 

·efficiencies to come from integrating certain of Delavan’sSTC’s operations into Wintrust’s existing operations; and

 

·the likelihood that the merger will be approved by the relevant bank regulatory authorities without undue burden and in a timely manner.

The above discussion of the information and factors considered by Wintrust’s board of directors is not intended to be exhaustive, but includes a description of all material factors considered by Wintrust’s board. In view of the wide variety of factors considered by the Wintrust board of directors in connection with its evaluation of the merger, the Wintrust board did not consider it practical to, nor did it attempt to, quantify, rank or otherwise assign relative weights to the specific factors that it considered. In considering the factors described above, individual directors may have given differing weights to different factors. Wintrust’s board of directors collectively made its determination with respect to the merger based on the conclusion reached by its members, based on the factors that each of them considered appropriate, that the merger is in the best interests of Wintrust’s shareholders.

Material U.S. federal income tax consequences of the merger

The following summary describes the material U.S. federal income tax consequences of the merger to U.S. holders (as defined below) of DelavanSTC common stock. The summary is based upon the Code, applicable Treasury Regulations, judicial decisions and administrative rulings and practice, all as in effect as of the date hereof, and all of which are subject to change, possibly with retroactive effect. This summary does not address any tax consequences of the merger under state, local or foreign laws, or any federal laws other than those pertaining to income tax.

For purposes of this discussion, the term “U.S. holder” means a beneficial owner that is: an individual citizen or resident of the United States; a corporation (or other entity taxable as a corporation for U.S. federal income tax purposes) created or organized under the laws of the United States or any of its political subdivisions; a trust that (1) is subject to the supervision of a court within the United States and the control of one or more U.S. persons or (2) has a valid election in effect under applicable U.S. Treasury regulations to be treated as a U.S. person; or an estate that is subject to U.S. federal income taxation on its income regardless of its source.

This discussion addresses only those holders of DelavanSTC common stock that hold their DelavanSTC common stock as a capital asset within the meaning of Section 1221 of the Code and does not address all the U.S. federal income tax consequences that may be relevant to particular holders of DelavanSTC common stock in light of their individual circumstances or to holders of DelavanSTC common stock that are subject to special rules, such as:

 

·financial institutions;

·investors in pass-through entities;

 

·persons who are subject to alternative minimum tax;

 

·insurance companies;

 

·                                          mutual funds;

·tax-exempt organizations;

 

·dealers in securities or currencies;

 

·traders in securities that elect to use a mark-to-market method of accounting;

 

·persons that hold DelavanSTC common stock as part of a straddle, hedge, constructive sale or conversion transaction;

 

·regulated investment companies;

 

·real estate investment trusts;

 

·persons whose “functional currency” is not the U.S. dollar;

 

·persons who are not citizens or residents of the United States; and

 

·holders who acquired their shares of DelavanSTC common stock through the exercise of an employee stock option or otherwise as compensation.

If a partnership (or other entity that is taxed as a partnership for federal income tax purposes) holds DelavanSTC common stock, the tax treatment of a partner in that partnership generally will depend upon the status of the partner and the activities of the partnership. Partnerships and partners in partnerships should consult their own tax advisors about the tax consequences of the merger to them.

The parties intend for the merger to be treated as a “reorganization” for U.S. federal income tax purposes. It is a condition to Delavan’sSTC’s obligation to complete the merger that DelavanSTC receive an opinion from WIPFLI, LLP, accountantsBarack Ferrazzano, counsel for Delavan,STC, dated the closing date, to the effect that (1) the merger will constitute a “reorganization” within the meaning of Section 368(a) of the Code, (2) DelavanSTC and Wintrust will each be a party to such reorganization within the meaning of Section 368(a) of the Code, and (3) except to the extent of any cash consideration received in the merger and except with respect to cash received in lieu of fractional share interests in Wintrust common stock, no gain or loss will be recognized by any of the holders of DelavanSTC common stock in the merger. This opinion is and will be based upon fact certifications or affidavits provided by Wintrust and DelavanSTC and upon customary factual assumptions. Neither Wintrust nor DelavanSTC has sought, and neither of them will seek, any ruling from the IRS regarding any matters relating to the merger, and the opinion described above will not be binding on the IRS or any court. Consequently, there can be no assurance that the IRS will not assert, or that a court would not sustain, a position contrary to any of the conclusions set forth in the opinion. In addition, if any of the representations or assumptions upon which the opinion is based are inconsistent with the actual facts, the U.S. federal income tax consequences of the merger could be adversely affected.

The actual tax consequences of the merger to you may be complex and will depend upon your specific situation and upon factors that are not within the control of Wintrust or Delavan.STC. You should consult with your own tax advisor as to the tax consequences of the merger in light of your particular circumstances, including the applicability and effect of the alternative minimum tax and any state, local or foreign and other tax laws.

The following expresses the opinion of WIPFLI, LLP, accountants to Delavan, insofar as it relates to matters of U.S. federal income tax law and legal conclusions with respect to those matters:

Tax Consequences of the Merger Generally. TheBased upon the facts and representations contained in the representation letters received from STC and Wintrust in connection with the filing of the registration statement on Form S-4 of which this proxy statement/prospectus forms a part, it is the opinion of Barack Ferrazzano that the merger will qualify as a reorganization within the meaning of Section 368(a) of the Code, and accordingly, the material U.S. federal income tax consequences of the merger will be as follows:

 

·no gain or loss will be recognized by Wintrust or DelavanSTC as a result of the merger;

 

·gain (but not loss) will be recognized by U.S. holders of DelavanSTC common stock who receive shares of Wintrust common stock and cash in exchange for shares of DelavanSTC common stock pursuant to the merger in an amount equal to the lesser of (1) the amount by which the sum of the fair market value of the Wintrust common stock and cash received by a U.S. holder of DelavanSTC common stock exceeds such U.S. holder’s basis in its DelavanSTC common stock and (2) the amount of cash received by such U.S. holder of DelavanSTC common stock;

 

·the aggregate basis of the Wintrust common stock received by a U.S. holder of DelavanSTC common stock in the merger (including fractional shares of Wintrust common stock deemed received and redeemed as described below) will be the same as the aggregate basis of the DelavanSTC common stock for which it is exchanged, decreased by the amount of cash received in the merger (other than cash received in lieu of a fractional share in Wintrust common stock), and increased by the amount of gain recognized on the exchange, other than with respect to cash received in lieu of a fractional share in Wintrust common stock (regardless of whether such gain is classified as capital gain or as dividend income, as discussed below under “—Potential Recharacterization of Gain as a Dividend”); and

 

·the holding period of Wintrust common stock received in exchange for shares of DelavanSTC common stock (including fractional shares of Wintrust common stock deemed received and redeemed as described below) will include the holding period of the DelavanSTC common stock for which it is exchanged.

If a U.S. holder of DelavanSTC common stock acquired different blocks of DelavanSTC common stock at different times or at different prices, any gain or loss will be determined separately with respect to each block of DelavanSTC common stock, and the cash and shares of Wintrust common stock received will be allocated pro rata to each such block of stock. U.S. holders should consult their own tax advisors with regard to identifying the bases or holding periods of the particular shares of Wintrust common stock received in the merger.

Taxation of Capital Gain.Except as described under “—Potential Recharacterization of Gain as a Dividend” below, gain that U.S. holders of DelavanSTC common stock recognize in connection with the merger generally will constitute capital gain and will constitute long-term capital gain if such U.S. holders have held (or are treated as having held) their DelavanSTC common stock for more than one year as of the date of the merger. The deductibility of capital losses is subject to limitations. For non-corporate U.S. holders of DelavanSTC common stock, the maximum U.S. federal income tax rate on long-term capital gains is, absent legislative action, 20%.

Potential Recharacterization of Gain as a Dividend.All or part of the gain that a particular U.S. holder of DelavanSTC common stock recognizes could be treated as dividend income rather than capital gain if (1) such U.S. holder is a significant shareholder of Wintrust or (2) such U.S. holder’s percentage ownership, taking into account constructive ownership rules, in Wintrust after the merger is not meaningfully reduced from what its percentage ownership would have been if it had received solely shares of Wintrust common stock rather than a combination of cash and shares of Wintrust common stock in the merger. This could happen, for example, because of ownership of additional shares of Wintrust common stock by such holder, ownership of shares of Wintrust common stock by a person related to such holder or a share repurchase by Wintrust from other holders of Wintrust common stock. The IRS has indicated in rulings that any reduction in the interest of a minority shareholder 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. Because the possibility of dividend treatment depends primarily upon the particular circumstances of a holder of DelavanSTC common stock, including the application of certain constructive

ownership rules, holders of DelavanSTC common stock should consult their own tax advisors regarding the potential tax consequences of the merger to them.

Cash Received Instead of a Fractional Share of Wintrust Common Stock.A U.S. holder of DelavanSTC common stock who receives cash in lieu of a fractional share of Wintrust common stock will be treated as having received the fractional share pursuant to the merger and then as having exchanged the fractional share for cash in a redemption by Wintrust. In general, this deemed redemption will be treated as a sale or exchange.  As a result, such U.S. holder of DelavanSTC common stock will generally recognize gain or loss equal to the difference between the amount of cash received and the basis in his or her fractional share interest as set forth above. The gain or loss recognized by the U.S. holders described in this paragraph will generally be capital gain or loss, and will be long-term capital gain or loss if, as of the effective date of the merger, the U.S. holder’s holding period for the relevant shares is greater than one year. The deductibility of capital losses is subject to limitations.

Medicare Tax on Unearned Income. For taxable years beginning after December 31, 2012, aA U.S. holder that is an individual is subject to a 3.8% tax on the lesser of (i) his or her “net investment income” for the relevant taxable year or (ii) the excess of his or her modified gross income for the taxable year over a certain threshold (between $125,000 and $250,000 depending on the individual’s U.S. federal income tax filing status). A similar regime applies to estates and trusts. Net investment income generally would include any capital gain incurred in connection with the merger (including any gain treated as a dividend).

Backup Withholding and Information Reporting.Payments of cash to a U.S. holder of DelavanSTC common stock pursuant to the merger may, under certain circumstances, be subject to information reporting and backup withholding unless the holder provides proof of an applicable exemption or, in the case of backup withholding, furnishes its taxpayer identification number and otherwise complies with all applicable requirements of the backup withholding rules. Any amounts withheld from payments to a U.S. holder under the backup withholding rules are not additional tax and generally will be allowed as a refund or credit against the U.S. holder’s U.S. federal income tax liability, provided the required information is timely furnished to the IRS.

A U.S. holder of DelavanSTC common stock who receives Wintrust common stock as a result of the merger will be required to retain records pertaining to the merger. Each U.S. holder of DelavanSTC common stock who is required to file a U.S. federal income tax return and who is a “significant holder” that receives Wintrust common stock in the merger will be required to file a statement with such U.S. federal income tax return in accordance with Treasury Regulations Section 1.368-3 setting forth such holder’s basis in the DelavanSTC common stock surrendered and the fair market value of the Wintrust common stock and cash received in the merger. A “significant holder” is a holder of DelavanSTC common stock who, immediately before the merger, owned at least 5% of the outstanding stock of DelavanSTC or securities of DelavanSTC with a basis for federal income taxes of at least $1 million.

This discussion does not address tax consequences that may vary with, or are contingent upon, individual circumstances. Moreover, it does not address any non-income tax or any foreign, state or local tax consequences of the merger. Tax matters are very complicated, and the tax consequences of the merger to you will depend upon the facts of your particular situation.Accordingly, we strongly urge you to consult with a tax advisor to determine the particular federal, state, local or foreign income or other tax consequences to you of the merger.

Regulatory approvals

The merger cannot proceed without obtaining all requisite regulatory approvals. Wintrust and DelavanSTC have agreed to take all appropriate actions necessary to obtain the required approvals.

The merger of Wintrust and DelavanSTC is subject to prior approval of each of the Federal Reserve and the Wisconsin Department of Financial Institutions.Reserve. Wintrust submitted an application with each of the Federal Reserve Bank of Chicago and the Wisconsin Department of Financial Institutions on October 20, 2014June 25, 2019 seeking the necessary approvals.

The merger may not be consummated until 15 days after receipt of Federal Reserve approval, during which time the United States Department of Justice may challenge the merger on antitrust grounds. The commencement of an antitrust action would stay the effectiveness of the Federal Reserve’s approval, unless a court specifically orders otherwise.

Interests of certain persons in the merger

General. Members of the board of directors and executive officers of Delavan, CommunitySTC, STC Bank and its subsidiariessubsidiary may have interests in the merger that are different from, or are in addition to, the interests of DelavanSTC shareholders

generally. The DelavanSTC board of directors was aware of these interests and considered them, among other matters, in approving the merger agreement and determining to recommend to DelavanSTC shareholders to vote for adoption of the merger agreement. As of September 30, 2014, Delavan’sJune 5, 2019, STC’s directors and executive officers owned, in the aggregate, 113,593207,016 shares of Delavan’sSTC’s common stock, representing approximately 30%46% of Delavan’sSTC’s outstanding shares of common stock. Mr. MurphySTC’s directors also holdsheld options to purchase 7,250an aggregate of 43,920 shares of DelavanSTC common stock.stock as of June 5, 2019.  In addition, Eduardo E. Greco, a director of STC, and certain of his affiliates are parties to loan transactions with certain bank subsidiaries of Wintrust.

Jon E. Martin, Delavan’s Senior Vice President and Chief Financial Officer, and Michael R. Ploch, Delavan’s Senior Vice President – Commercial Lending, are also entitled to stock appreciation rights in amounts equal to approximately $171,000 and $195,000, respectively, (assuming that the reference price is between $39.50 and $49.50) pursuant to the Delavan Bancshares, Inc. 2008 Stock Appreciation Right Plan. All such stock appreciation rights outstanding immediately prior to the effective time will vest and become payable at the effective time.

Employment Agreement. The merger agreement required Michael J. MurphyChristopher Woelffer, STC’s President and STC Bank’s President and Chief Executive Officer, to enter into an employment agreement with Community Bank.St. Charles Bank & Trust Company. Under such agreement, Mr. MurphyWoelffer will serve as PresidentVice Chair of CommunitySt. Charles Bank & Trust Company, successor to STC Bank, upon the effective time of the merger andmerger.  He will be entitled to receive a base salary substantially similar to his current base salary. Such agreement has an initial term of one year,three years, which begins on the closingeffective date with automatic one-year renewal terms unless either party gives notice of non-renewal. In the event of a change in control of Wintrust or Community Bank, the term of the merger.

Retention Agreement.  The merger agreement will automatically extend for one year.

required Jodi Ariss, Senior Vice President of STC Bank, to enter into a retention agreement with STC Bank and St. Charles Bank & Trust Company.  Under his employmentsuch agreement, if Mr. Murphy’s employment is terminated by Community Bank without cause or if Mr. Murphy terminates his employment due to a constructive termination, Mr. Murphyupon the closing of the transaction, Ms. Ariss will be entitled to severance pay up to one times annual baseemployed by St. Charles Bank & Trust Company at her current salary plus target annual bonus plus $250,000, payable ratably over a 12-month period beginning on the first payroll period following such termination (or in a lump sum if the termination occurs within 12 months following a change in control of Wintrust or Community Bank), as well as continued health insurance for up to the maximum period under COBRA. The agreement also provides that, if necessary, severance pay will be reduced to an amount thatand is one dollar less than the maximum amount payable without loss of a deduction under Section 280G of the Code. In consideration of the termination of Mr. Murphy’s existing employment agreement with Community Bank and his entry into such new employment agreement, Mr. Murphy is also entitledeligible to receive an amount equal to $200,000 followinga retention bonus one year from the consummation of the merger, or such lesser amount as he may have otherwise been owed pursuant to his existing agreement.effective date.

Continued Director and Officer Liability Coverage. Pursuant to the terms of the merger agreement, Wintrust has agreed to provide to each person who serves as a director, officer, member or officermanager of DelavanSTC or its subsidiaries after the effective time substantially the same insurance coverage against personal liability for actions taken after the effective time as is provided to other directors and officers of Wintrust’s subsidiary banks. In addition, Wintrust agreed to pay for insurance coverage for up to six years following the closing date under a policy of directors’ and officers’ liability and other professional insurance for actions taken on or prior to the effective time of the merger, so long as the premium or premiums of such policy are acceptabledo not exceed $125,000, which we refer to Wintrust in its sole discretion.as the maximum premium.  If a six-year term of insurancesuch tail coverage is not available the term for the maximum premium, the insurance willobtained shall be such other maximum period of coverage thatas comparable as is available at a costfor such maximum premium.

Wintrust has agreed to cause the surviving entity to indemnify STC’s and STC Bank’s past and current directors, officers, members and managers consistent with any indemnification provided to such individuals under Illinois law, the cost incurred by Delavan’sarticles of incorporation and bylaws of STC, the charter and bylaws of STC Bank, or Communitythe operating agreement of STC Bank’s current directors’ and officers’ liability and other professional insurance policies in effectsubsidiary, as of the effective time.case may be.

Voting agreement

On October 13, 2014, allJune 5, 2019, certain directors of DelavanSTC who own shares of DelavanSTC common stock entered into a voting agreement with Wintrust. Under this agreement, these shareholders have each agreed to vote their respective shares of DelavanSTC common stock:

 

·in favor of the merger and the transactions contemplated by the merger agreement;

·                                          in favor of the approval of any proposal to adjourn or postpone the meeting to a later date if requested by Wintrust or Merger Co.;

·against any action, proposal, transaction or agreement that would result in a breach of any term or obligation of DelavanSTC under the merger agreement;

 

·against any action or agreement that would impede, interfere with, prevent or attempt to discourage the transactions contemplated by the merger agreement;

·against any other proposed transaction or series of transactions involving or affecting DelavanSTC or CommunitySTC Bank (or the securities or assets of either) that, if effected, would constitute an acquisition of control of either Delavan or Community Bank, which we refer to as an acquisition proposal;a company takeover proposal under the merger agreement; and

 

·in favor of any other matter necessary for the consummation of the transactions contemplated by the merger agreement.

Furthermore, each of these shareholders has also agreed not to transfer or otherwise dispose of any shares of DelavanSTC common stock that they own (other than under certain circumstances up to 2% of such shareholders’ shares of Delavan common stock to a family member of such shareholder)circumstances), grant any proxies, deposit any shares of DelavanSTC common stock into a voting trust or enter into any other voting agreement with respect to any shares of DelavanSTC common stock that they own or, without the prior approval of Wintrust, directly or indirectly solicit, initiate, encourage or facilitate any acquisitioncompany takeover proposal, or initiate or participate in any negotiations or discussions concerning any acquisitioncompany takeover proposal. The shares subject to the voting agreement representrepresented approximately 28%46% of Delavan’sSTC’s outstanding shares of common stock as of September 30, 2014.June 5, 2019. The voting agreement will terminate upon the earlier of the consummation of the merger or termination of the merger agreement in accordance with its terms.

Restrictions on resale of Wintrust common stock

The shares of Wintrust common stock to be issued in connection with the merger will be registered under the Securities Act of 1933, as amended, which we refer to as the Securities Act, and will be freely transferable, except for shares issued to any shareholder who may be deemed to be an “affiliate” of Wintrust for purposes of Rule 144 under the Securities Act. Persons who may be deemed to be affiliates of Wintrust include individuals or entities that control, are controlled by, or are under common control with, Wintrust and may include the executive officers, directors and significant shareholders of Wintrust.

DelavanSTC shareholder dissenters’ rights

In connection with the merger, record holders of DelavanSTC common stock who comply with the requirements of Subchapter XIIISections 11.65 and 11.70 of the WBCL,IBCA, which isare summarized below, will be entitled to dissenters’ rights if the merger is completed. Under Subchapter XIIISection 11.65 of the WBCL,IBCA, a shareholder of a corporation is entitled to dissent from, and obtain payment of the fair value of his or her shares in the event of, the consummation of a merger to which the corporation is a party if shareholder approval is required for the merger by Section 180.110311.20 of the WBCLIBCA or by the articles of incorporation of the corporation.

The following is a brief summary of Subchapter XIII,Sections 11.65 and 11.70, which setsset forth the procedures relating to the exercise of dissenters’ rights.This summary is not a complete statement of the law pertaining to dissenters’ rights under the WBCLIBCA and is qualified in its entirety by reference to Subchapter XIII, the text ofSections 11.65 and 11.70, which isare attached to this proxy statement/prospectus asAnnex B.

Under the IBCA, all STC shareholders entitled to dissenters’ rights in the merger must be informed of their right to dissent and the procedure to dissent in the notice of meeting. This proxy statement/prospectus constitutes notification of these rights.

Any shareholder who wishes to assert dissenters’ rights must do all of the following:

·deliver a written notice ofdemand for payment for his or her intentshares of STC common stock to exercise such right to Delavan Bancshares, Inc., 820 Geneva Street, Delavan, Wisconsin 53115, Attention: Michael J. Murphy, President and CEO,STC before the vote on the merger agreement is taken at the special meeting.meeting;

·                  not vote in favor of the merger agreement; however, A PROXY OR VOTE AGAINST THE MERGER AGREEMENT WILL NOT, BY ITSELF, BE REGARDED AS A WRITTEN NOTICE OF INTENT TO DEMAND FOR PAYMENT FOR PURPOSES OF ASSERTING DISSENTERS’ RIGHTS.

RIGHTS; and

·                  continue to hold STC common stock through the effective time of the merger.

A record holder of DelavanSTC common stock may assert dissenters’ rights as to fewer than all shares registeredrecorded in that shareholder’srecord holder’s name only if the record holder dissents with respect to all shares beneficially owned by any one person and notifies DelavanSTC in writing of the name and address of each person on whose behalf the shareholderrecord holder asserts such dissenters’ rights.

A beneficial shareholderowner who is not the record owner may assert dissenters’ rights as to shares held on the shareholder’sbeneficial owner’s behalf only if, in addition to meeting the other requirements to dissent, the beneficial shareholder (i)owner submits to DelavanSTC the record shareholder’sholder’s written consent to the dissent not later thanbefore or at the same time the beneficial shareholder asserts dissenters’ rights.

A dissenting shareholder retains all other rights and (ii) asserts dissenters’of a shareholder until those rights with respect to all sharesare cancelled or modified by the consummation of which the shareholder ismerger.

Within 10 days after the beneficial shareholder or over which the beneficial shareholder has power to direct the vote.

Ifeffective date of the merger agreementor 30 days after the dissenting shareholder delivers a legally sufficient written demand for payment, whichever is approved bylater, Merger Co., as the requisite vote of holders of Delavan common stock, Delavansurviving company, is required to send a notice to all dissenting shareholders containing payment demand and stock certificate surrender information within ten days after such approval. The return date specified by Delavan for receivinga statement setting forth its opinion as to the payment demand from dissenting shareholders may not be less than 30 nor more than 60 days after the date on which the dissenters’ notice was first sent. Upon receiptestimated fair value of the dissenters’ notice, eachSTC common stock, certain financial statements, and a commitment to pay for the shares of the dissenting shareholder must return his or her payment demand and certificate no later thanat the payment demand date as provided in the dissenters’ notice and certify whether he or she acquired beneficial ownershipestimated fair value upon transmittal of the shares prior to the first public announcement of the terms of the merger on October 14, 2014. A payment demand may not be withdrawn without Delavan’s consent.

certificates representing STC common stock. Upon effecting the merger, within 60 days after the payment demand date, DelavanMerger Co. will pay each dissenting shareholder who properly complied with the statutory requirements of Subchapter XIIISections 11.65 and 11.70 of the WBCL,IBCA the amount that DelavanMerger Co. estimates to be the fair value of such dissenting shareholder’s shares, plus accrued interest, fromand provide a written explanation of how the effective time; provided that, with respect to shares acquired after the first public announcement of the merger, Delavan may elect to withhold payment until either such shareholder accepts Delavan’s offer of fair value or a court determines the fair value of such shares.interest was calculated.

If the merger is not effected within 60 days of the payment demand date, Delavan will return all deposited certificates to dissenting shareholders. If the merger is thereafter effected, Delavan will send a new dissenters’ notice within ten days of effecting the merger and repeat the payment demand procedure described above.

If any dissenting shareholder is dissatisfieddoes not agree with Delavan’sMerger Co.’s determination of “fair value,”value” or the amount of interest due, such dissenting shareholder maymust notify DelavanMerger Co. in writing of his or her own estimate of the fair value of his or her shares andor the amount of interest due.due and demand the difference between his or her estimate and the proposed payment by Merger Co. A dissenting shareholder must assert this right within 30 days after Delavan makes or offers payment for his or herMerger Co. delivers its valuation statement. If Merger Co. and the dissenting shareholder have not agreed in writing to the fair value of the shares or the right is waived. Delavan may either accept suchinterest due within 60 days from delivery of the dissenting shareholder’s estimate of fair valuenotification, Merger Co. shall either pay the difference, with interest, demanded by the shareholder or commence a proceedingproceedings in the Wisconsin Circuit Courtcircuit court of Walworth CountyKane county to determine the fair value of the shares ofand interest due to all dissenting shareholders whose own estimates of fair value are not accepted by Delavan.Merger Co. Merger Co. is required to make all dissenting shareholders parties to the proceeding. If Merger Co. does not commence the action, the dissenting shareholder may commence an action.

The value determined by the court may be more than, the same as or less than the value of the consideration a holder of STC common stock is entitled to receive under the merger agreement. “Fair value” means the proportionate interest of the shareholder in the corporation, without discount for minority status or, absent extraordinary circumstance, lack of marketability, immediately before the closing of the merger, excluding any appreciation or depreciation in anticipation of the merger unless the exclusion would be inequitable.

The court will also determine all costs of the proceeding. If the fair value determined by the court materially exceeds Merger Co.’s estimate of the fair value, all or any part of the costs may be assessed against Merger Co. If the amount which any dissenting shareholder estimated to be the fair value materially exceeds the fair value determined by the court, all or any part of the costs may be assessed against such dissenting shareholder. Costs may also be assessed against Merger Co. if Merger Co. did not substantially comply with the procedures set forth in the statute, or against either party if the court finds that such party acted arbitrarily, vexatiously or not in good faith with respect to the dissenters’ rights.

All written communications, including the written demand, from holders of STC common stock with respect to the exercise of dissenters’ rights should be mailed to: STC Bancshares Corp., 460 S. 1st Street, St. Charles, Illinois 60174, Attention: Christopher Woelffer, President.

In the event any holder of shares of DelavanSTC common stock fails to perfect his or her rights to dissent by failing to comply strictly with the applicable statutory requirements of Subchapter XIIISections 11.65 and 11.70 of the WBCL,IBCA, he or she will be bound by the terms of the merger agreement and will not be entitled to payment for his or her shares under Subchapter XIIISections 11.65 and 11.70 of the WBCL.IBCA. ANY HOLDER OF SHARES OF DELAVANSTC COMMON STOCK WHO WISHES TO OBJECT

TO THE TRANSACTION AND DEMAND PAYMENT IN CASH FOR HIS OR HER SHARES SHOULD CONSIDER CONSULTING HIS OR HER OWN LEGAL ADVISOR.

Because an executed proxy relating to DelavanSTC common stock on which no voting direction is made will be voted at the special meeting in favor of the merger, a dissenting shareholder who wishes to have his or her shares of DelavanSTC common stock represented by proxy at the special meeting but preserve his or her dissenters’ rights must mark his or her proxy either to vote against the merger or to abstain from voting thereon, in addition to the foregoing requirements.

The foregoing is a brief summary of Subchapter XIIISections 11.65 and 11.70 of the IBCA that sets forth the procedures for demanding statutory dissenters’ rights. This summary is qualified in its entirety by reference to Subchapter XIII,Sections 11.65 and 11.70 of the IBCA, the text of which is attached hereto asAnnex B. Failure to comply with all the procedures set forth in Subchapter XIIISections 11.65 and 11.70 of the IBCA will result in the loss of a shareholder’s statutory dissenters’ rights. Consequently, if you desire to exercise your dissenters’ rights you are urged to consult a legal advisor before attempting to exercise these rights.

DESCRIPTION OF THE MERGER AGREEMENT

The following is a summary of the material terms of the merger agreement. This summary does not purport to describe all the terms of the merger agreement and is qualified by reference to the complete text of the merger agreement which is attached as Annex AA-1 to this proxy statement/prospectus, as amended by the amendment to the merger agreement which is attached as Annex A-2 to this proxy statement/prospectus, and is incorporated by reference into this proxy statement/prospectus. You should read the merger agreement completely and carefully as it, rather than this description, is the legal document that governs the merger.

The text of the merger agreement has been included to provide you with information regarding its terms. The terms of the merger agreement (such as the representations and warranties) are intended to govern the contractual rights and relationships, and allocate risks, between the parties in relation to the merger. The merger agreement contains representations and warranties Wintrust and DelavanSTC made to each other as of specific dates. The representations and warranties were negotiated between the parties with the principal purpose of setting forth their respective rights with respect to their obligations to complete the merger. The statements embodied in those representations and warranties may be subject to important limitations and qualifications as set forth therein, including a contractual standard of materiality different from that generally applicable under federal securities laws.

GeneralGeneral

The merger agreement provides for the merger of DelavanSTC with and into Merger Co., with Merger Co. continuing as the surviving corporation.company. After the consummation of the merger, Merger Co. will continue to be a wholly-owned subsidiary of Wintrust.

Closing and effective time

Closing.The closing of the merger will take place on the fifth business day following the satisfaction of the conditions to closing set forth in the merger agreement, or at another time that both parties mutually agree upon. See “—Conditions to completion of the merger” below for a more complete description of the conditions that must be satisfied prior to closing. The date of completion of the merger sometimes is referred to in this proxy statement/prospectus as the closing date.

Completion of the Merger.The merger will become effective on the date when the articles of merger are duly filed withhave been accepted by the WDFI,IL SOS, or at such later date and time specified in such filing as the parties mutually agree upon. The time at which the merger becomes effective is sometimes referred to in this proxy statement/prospectus as the effective time.

Consideration to be received in the merger

DelavanSTC Common Stock. If the merger is completed, the shares of DelavanSTC common stock which you own immediately before the completion of the merger will be converted into a right to receive cash and shares of Wintrust common stock, subject in each case to the adjustment procedures described below under “—Adjustment to Merger Consideration.” The aggregate merger consideration paid by Wintrust to DelavanSTC shareholders is expected to be $100 per share of outstanding STC common stock, or an aggregate of approximately $38,000,000,$44,922,900, based on 449,229 shares of STC common stock outstanding as of       , 2019, subject to an escrow holdback, possible upward or downward adjustment as described below.below, and fluctuations in the trading price of Wintrust common stock. Assuming that the reference price as described below is between $39.50at least $64.00 and $49.50,no greater than $76.00 and no deduction from the escrowed funds and no adjustment to the merger consideration, 50% of the aggregate merger consideration will be paid in shares of Wintrust common stock and 50% will be paid in cash.

Assuming no deduction from the escrowed funds and no adjustment to the merger consideration, and that the currently outstanding 373,989 shares of Delavan common stock remain unchanged at the closing, based on a reference price of $      , which is equal to the reference price if it were calculated as of       , 2014,2019, the latest practicable date prior to the date of this proxy statement/prospectus, the merger consideration that a DelavanSTC shareholder would be entitled to receive for each share of DelavanSTC common stock, which we refer to as the per share merger consideration, would be $      in cash and       shares of Wintrust common stock. In each case assuming no adjustment to the merger consideration and that the currently outstanding 373,989 shares of Delavan common stock remain unchanged at the

closing, ifIf the reference price were less than or equal to the minimum of $39.50,$64.00, each share of DelavanSTC common stock would instead be entitled to 1.2860.781 shares of Wintrust common stock, and if the reference price were greater than or equal to the maximum of $49.50,$76.00, each share of DelavanSTC common stock would be entitled to 1.0270.658 shares of Wintrust common stock.

Cash Consideration. Subject to possible upward or downward adjustment, for each share of DelavanSTC common stock, you will be entitled to receive at closing cash equal to $50.00, minus the quotient of (i) $2,900,000, which is the product obtained by multiplying (a) $38,000,000 by (b) 0.5, withamount of the resultant amountescrowed funds divided by (ii) the number of shares of DelavanSTC common stock issued and outstanding immediately prior to the effective time, rounded to the nearest $0.01, which we refer to as the per share cash consideration. For more information on the distribution of escrowed funds, see “—Escrow Holdback” below.

Stock Consideration. Subject to possible downward adjustment, forFor each share of DelavanSTC common stock, you will be entitled to receive at closing a number of shares of Wintrust common stock equal to (i) the quotient obtained by dividing (a) the aggregate share amount (as defined below) by (b) the number of shares of DelavanSTC common stock issued and outstanding immediately prior to the effective time of the merger, rounded to the nearest thousandth of a share (0.001), multiplied by (ii) 0.5, such product rounded to the nearest thousandth of a share (0.001), which we refer to as the per share stock consideration.

The merger agreement provides that the aggregate share amount will be determined as follows:

If

·                                          if the reference price is at least $39.50$64.00 and no more than $49.50,$76.00, the aggregate share amount will be the number of shares of Wintrust common stock equal to the quotient (rounded up to the nearest whole share) obtained by dividing (i) $38,000,000$100 multiplied by the number of shares of STC common stock issued and outstanding immediately prior to the effective time of the merger by (ii) the reference price;

 

·if the reference price is less than $39.50,$64.00, the aggregate share amount will be 962,025 shares of Wintrust common stock (thethe number of shares determined by dividing $38,000,000(i) $100 multiplied by $39.50);the number of shares of STC common stock issued and

outstanding immediately prior to the effective time of the merger by (ii) $64.00, rounded up to the nearest whole share; and

 

·if the reference price is greater than $49.50,$76.00, the aggregate share amount will be 767,676 shares of Wintrust common stock (thethe number of shares determined by dividing $38,000,000(i) $100 multiplied by $49.50).

Delavan may terminatethe number of shares of STC common stock issued and outstanding immediately prior to the effective time of the merger agreement if the reference price is less than $36.50 and Wintrust may terminate the merger agreement if the reference price is more than $52.50, in each case if Delavan and Wintrust are in good faith unable, after five business days’ notice of such termination, to reach agreement as to an amendmentby (ii) $76.00, rounded up to the merger agreement containing terms acceptable to Wintrust and Delavan so that the merger and the transactions contemplated by the merger agreement may be consummated.nearest whole share.

The following table illustrates the per share value of merger consideration that Delavan’sSTC’s shareholders will receive in the merger based on a range of reference prices, assuming no deductions from the currently outstanding 373,989 shares of Delavan common stock remain unchanged immediately priorescrowed funds and no adjustment to the effective time of the merger.merger consideration. The table is for illustrative purposes only. The actual prices at which

Wintrust common stock trades during the reference period will establish the actual reference price and therefore the actual aggregate share amount and merger consideration. The table assumes the closing price of Wintrust’s common stock on the date of the merger is the same as the reference price during the reference period. The actual trading price of Wintrust common stock is subject to market fluctuations, and DelavanSTC shareholders will not be entitled to receive additional shares in the merger if the trading price of Wintrust’s common stock on the closing date is less than the averagereference price during the reference period nor will they receive fewer shares in the merger if the trading price of Wintrust’s common stock on the closing date is greater than the averagereference price.

Per Share Merger Consideration

 

Wintrust
Reference Price

 

Per Share Cash
Consideration

 

Per Share Stock
Consideration(1)

 

Total Per Share
Consideration

 

$

61.00

 

$

50

 

$

47.66

 

$

97.66

 

$

61.50

 

$

50

 

$

48.05

 

$

98.05

 

$

62.00

 

$

50

 

$

48.44

 

$

98.44

 

$

62.50

 

$

50

 

$

48.83

 

$

98.83

 

$

63.00

 

$

50

 

$

49.22

 

$

99.22

 

$

63.50

 

$

50

 

$

49.61

 

$

99.61

 

$

64.00

 

$

50

 

$

50.00

 

$

100.00

 

$

64.50

 

$

50

 

$

50.00

 

$

100.00

 

$

65.00

 

$

50

 

$

50.00

 

$

100.00

 

$

65.50

 

$

50

 

$

50.00

 

$

100.00

 

$

66.00

 

$

50

 

$

50.00

 

$

100.00

 

$

66.50

 

$

50

 

$

50.00

 

$

100.00

 

$

67.00

 

$

50

 

$

50.00

 

$

100.00

 

$

67.50

 

$

50

 

$

50.00

 

$

100.00

 

$

68.00

 

$

50

 

$

50.00

 

$

100.00

 

$

68.50

 

$

50

 

$

50.00

 

$

100.00

 

$

69.00

 

$

50

 

$

50.00

 

$

100.00

 

$

69.50

 

$

50

 

$

50.00

 

$

100.00

 

$

70.00

 

$

50

 

$

50.00

 

$

100.00

 

$

70.50

 

$

50

 

$

50.00

 

$

100.00

 

$

71.00

 

$

50

 

$

50.00

 

$

100.00

 

$

71.50

 

$

50

 

$

50.00

 

$

100.00

 

$

72.00

 

$

50

 

$

50.00

 

$

100.00

 

$

72.50

 

$

50

 

$

50.00

 

$

100.00

 

$

73.00

 

$

50

 

$

50.00

 

$

100.00

 

$

73.50

 

$

50

 

$

50.00

 

$

100.00

 

$

74.00

 

$

50

 

$

50.00

 

$

100.00

 

$

74.50

 

$

50

 

$

50.00

 

$

100.00

 

$

75.00

 

$

50

 

$

50.00

 

$

100.00

 

$

75.50

 

$

50

 

$

50.00

 

$

100.00

 

$

76.00

 

$

50

 

$

50.00

 

$

100.00

 

$

76.50

 

$

50

 

$

50.33

 

$

100.33

 

$

77.00

 

$

50

 

$

50.66

 

$

100.66

 

$

77.50

 

$

50

 

$

50.99

 

$

100.99

 

$

78.00

 

$

50

 

$

51.32

 

$

101.32

 

$

78.50

 

$

50

 

$

51.64

 

$

101.64

 

$

79.00

 

$

50

 

$

51.97

 

$

101.97

 

$

79.50

 

$

50

 

$

52.30

 

$

102.30

 


(1)         The numbers in this column represent the value of the shares of Wintrust common stock which you will receive for each share of STC common stock that you own, subject to the assumption that the closing price duringof Wintrust’s common stock on the date of the merger is the same as the reference period.price.

 

Per Share Merger Consideration 
Wintrust
Reference
Price
   Per Share
Cash
Consideration
   Per Share
Stock
Consideration(1)
   Total Per
Share
Consideration
 
$36.50    $50.80    $46.94    $97.74  
$37.00    $50.80    $47.58    $98.38  
$37.50    $50.80    $48.23    $99.03  
$38.00    $50.80    $48.87    $99.67  

$    38.50    $    50.80    $    49.51    $    100.31  
$    39.00    $50.80    $50.15    $100.95  
$39.50    $50.80    $50.80    $101.60  
$40.00    $50.80    $50.80    $101.60  
$40.50    $50.80    $50.83    $101.63  
$41.00    $50.80    $50.80    $101.60  
$41.50    $50.80    $50.80    $101.60  
$42.00    $50.80    $50.82    $101.62  
$42.50    $50.80    $50.83    $101.63  
$43.00    $50.80    $50.83    $101.63  
$43.50    $50.80    $50.81    $101.61  
$44.00    $50.80    $50.82    $101.62  
$44.50    $50.80    $50.82    $101.62  
$45.00    $50.80    $50.81    $101.61  
$45.50    $50.80    $50.82    $101.62  
$46.00    $50.80    $50.83    $101.63  
$46.50    $50.80    $50.82    $101.62  
$47.00    $50.80    $50.81    $101.61  
$47.50    $50.80    $50.83    $101.63  
$48.00    $50.80    $50.83    $101.63  
$48.50    $50.80    $50.83    $101.63  
$49.00    $50.80    $50.81    $101.61  
$49.50    $50.80    $50.84    $101.64  
$50.00    $50.80    $51.35    $102.15  
$50.50    $50.80    $51.86    $102.66  
$51.00    $50.80    $52.38    $103.18  
$51.50    $50.80    $52.89    $103.69  
$52.00    $50.80    $53.40    $104.20  
$52.50    $50.80    $53.92    $104.72  

(1)The numbers in this column represent the value of the shares of Wintrust common stock which you will receive for each share of Delavan common stock that you own, subject to the assumption that the closing price of Wintrust’s common stock on the date of the merger is the same as the reference price during the reference period.

Adjustment to Merger Consideration. Five business days prior to the effective time of the merger, Delavanclosing date, STC will deliver to Wintrust an estimated consolidated balance sheets,sheet, which we refer to as the closing balance sheets,sheet, for Delavan and each of its subsidiariesSTC as of the

closing date reflecting Delavan’sSTC’s good faith estimate of the accounts of Delavan and its subsidiaries.STC on a consolidated basis. The closing balance sheetssheet will be prepared in conformity with past practices and policies of DelavanSTC and its subsidiaries and in accordance with GAAP, subject to adjustment to reflect that (i) thethere is no outstanding indebtedness of Delavan does not exceed $3,600,000, which indebtedness will be assumed by Wintrust,STC and (ii) CommunitySTC Bank’s reserve for loan losses atis not less than 1.50%1.20% of its net loans, and (iii) any environmental adjustments described below.loans. If the closing balance sheets reflectsheet reflects that Delavan’sSTC’s shareholders’ equity, as determined pursuant to the merger agreement and subject to certain exclusions described therein, is greater than or less than $26,000,000,$30,700,000 plus the amount of proceeds credited from the exercise of outstanding options (but excluding from December 31, 2018 to the closing date, positive security gains that may be recognized and changes to the amount of the total accumulated other comprehensive losses), then subject to Delavan’s termination right described below under “—Termination,” the merger consideration will be increased or reduced, respectively, dollar-for-dollar by an amount equal to such excess or shortfall. Any such increase or reduction will be allocated equally to the cash and stock portionsportion of the merger consideration. For purposes of determining the shareholders’ equity in DelavanSTC reflected in the closing balance sheets, all accruals and expenses for contributions and other payments madesheet, STC’s equity will be reduced by (i) any fees paid by STC or its subsidiaries in connection with the merger, (ii) the after-tax basis of any costs to be made topaid by STC or its subsidiaries in accordance with any benefit plan will be netchange of control agreements, (iii) the amount of any income tax benefit derived from such accrued contribution or other payments by Delavan or Community Bank.

The merger consideration may also be adjusted downward to reflect certain environmental conditions related to real property of Delavan or its subsidiaries. If any environmental survey confirms, in Wintrust’s sole discretion,costs associated with the presencetermination of certain environmental conditionsdata processing agreements in excess of $350,000, and (iv) the amount of any costs associated with the discharge or removal of certain new encumbrances on any such properties, Wintrust may (i) accept such property in its current condition subject to a reduction inreal property. Costs associated with the data conversion process, however, will not be deducted from shareholders’ equity.

Escrow Holdback. $2,900,000 of the cash portion of the merger consideration equalwill be deposited in special purpose non-interest bearing escrow accounts. Pursuant to anthe escrow agreement, $2,500,000 will be held for a period of up to 15 months for the purposes of funding STC’s indemnification obligations under the merger agreement and supplementing the reserve amount referred to below by up to $500,000. Pursuant to the reserve agreement, $400,000 will be held to fund the shareholders’ obligation to indemnify the shareholders’ representative (including reimbursement of expenses) and the expenses of the litigation entity in taking any actions relating to certain customer litigation. The reserve amount will be held until such customer litigation has been resolved, concluded, settled or decided not to pursue further, but not more than five years from the commencement of the customer litigation. A claim against the escrowed funds may reduce the aggregate cash consideration to be distributed to the STC shareholders in connection with the merger. Any amounts received by the litigation entity may increase the reserve amount to be mutually agreed upon in good faith by Wintrustdistributed to the STC shareholders.  The escrow agent for both accounts is The Chicago Trust Company, N.A., a subsidiary of Wintrust.

Assuming there are 449,229 issued and Delavan, or (ii) terminateoutstanding shares of STC stock immediately prior to the merger agreement. Ifeffective time, then the estimated costper share escrow holdback would be $6.46 per share of remediation is less than $200,000, at Wintrust’s election, insteadSTC common stock.

Upon the release of terminatingthe amounts held pursuant to the escrow agreement, the merger agreement Wintrust may acceptand the real propertyescrow agreement provide that for each share of STC common stock, you will be entitled to receive an amount in its current condition and reducecash equal to the shareholders’ equity for purposesquotient obtained by dividing any remaining portion of the closing balance sheetsescrow amount by the amounttotal number of outstanding shares of STC immediately prior to the effective time of the estimated costmerger, rounded to the nearest $0.01.

Upon the release of remediation.

the amounts held pursuant to the reserve agreement, the merger agreement and the reserve agreement provide that for each share of STC common stock, you will be entitled to receive an amount in cash equal to the quotient obtained by dividing any remaining portion of the reserve amount, plus any amounts received as a result of the customer litigation, by the total number of outstanding shares of STC immediately prior to the effective time of the merger rounded to the nearest $0.01.

The foregoing descriptions of the escrow agreement and reserve agreement are subject to, and qualified their entirety by reference to, the escrow agreement and reserve agreement, forms of which are attached as Exhibit B and Exhibit C, respectively, to the merger agreement and the amendment to the merger agreement (which are attached to this proxy statement/prospectus as Annex A-1 and Annex A-2, respectively) and are incorporated by reference into this proxy statement/prospectus.

Fractional shares

No fractional shares of Wintrust common stock will be issued in the merger. Instead, Wintrust will pay to each holder of DelavanSTC common stock who would otherwise be entitled to a fractional share of Wintrust common stock

an amount in cash (without interest) rounded to the nearest whole cent, determined by multiplying the reference price by such fraction of a share of Wintrust common stock to which such DelavanSTC shareholder would otherwise be entitled.

Treatment of DelavanSTC options

If the merger is completed, each outstanding and unexercised option to acquire a share of Delavan common stock, which we refer to as a DelavanSTC option will be converted into an option to acquire shares of Wintrust common stock, which we refer to as a converted option. The number of shares of Wintrust common stock subject to each converted option will be equal to the product obtained by multiplying (1) the number of shares of DelavanSTC common stock subject to such DelavanSTC option by (2) the quotient obtained by dividing an amount in cash equal to aggregate value of the per share merger consideration (assuming no deductions from the escrowed funds) by the reference price, which weprice. We refer to such quotient as the option exchange ratio. The per share exercise price for each converted option will be equal to the quotient obtained by dividing (1) the per share exercise price of the DelavanSTC option by (2) the option exchange ratio. Upon exercise of each converted option, the aggregate number of shares of Wintrust common stock deliverable upon such exercise will be rounded down, if necessary, to the nearest whole share and the aggregate exercise price will be roundrounded up, if necessary, to the nearest cent. Except as described above, each converted option will be governed by the same terms and conditions as in effect immediately prior to the effective time.

Appointment of Shareholders’ AgentRepresentative

Upon the approval of the DelavanSTC shareholders as described in this proxy statement/prospectus, Michael J. MurphyAnthony V. Sisto will be constituted and appointed as the shareholders’ agentrepresentative and attorney-in-fact with respect to taking any and all actions upon the adoption of the merger agreement specified or contemplated by the merger agreement.agreement, the escrow agreement or the reserve agreement (including as manager of the litigation entity). If Mr. MurphySisto is unable or unwilling to perform his duties, James Saer,Keith Kotche, the Alternate Shareholders’ Agent,alternate shareholders’ representative, will instead serve as the Shareholders’ Agent.shareholders’ representative. The actions of the Shareholders’ Agentshareholders’ representative pursuant to the merger agreement, the escrow agreement or the reserve agreement (including as manager of the litigation entity) will bind each DelavanSTC shareholder, and no notice to or approval by the DelavanSTC shareholders of such action will be required. Wintrust will be entitled to rely on any action taken by the Shareholders’ Agentshareholders’ representative as may be contemplated by the merger agreement or the escrow agreement in his or her capacity as agent for the DelavanSTC shareholders, for the benefit of all DelavanSTC shareholders, and Wintrust will have no duty to inquire into the circumstances in which any such action is taken. The Shareholders’ Agentshareholders’ representative will be fully protected, held harmless and indemnified by Delavan’sSTC’s shareholders in exercising, or in declining to exercise, a power provided for or contemplated by the merger agreement, the escrow agreement or the reserve agreement or relating to certain customer litigation for the benefit of all DelavanSTC shareholders (as manager of the litigation entity), as he or she determines whether upon consultation with the Delavan shareholders or in his or her sole discretion, to be in the interests of all DelavanSTC shareholders.  Such indemnification obligations shall be funded by the reserve amount.

In the event that both Mr. MurphySisto and Mr. SaerKotche should become unable or unwilling to perform such person’s duties, and unable or unwilling to appoint a subsequent successor, then Wintrust will appoint any reasonable successor Shareholders’ Agent from among the Delavan shareholders or former officers of Delavan.shareholders’ representative. Any successor Shareholders’ Agentshareholders’ representative so appointed will be vested with the same power and authority as the initial Shareholders’ Agent.shareholders’ representative.

Exchange of certificates

Wintrust has engaged American Stock Transfer & Trust Company, LLC to act as its exchange agent to handle the exchange of DelavanSTC common stock for the merger consideration and the payment of cash for any fractional share interest. Within threefive business days after the closing date, the exchange agent will send to each DelavanSTC shareholder a letter of transmittal for use in the exchange with instructions explaining how to surrender DelavanSTC common stock certificates to the exchange agent. DelavanSTC shareholders that surrender their certificates to the exchange agent, together with a properly completed letter of transmittal, will receive the merger consideration. DelavanSTC shareholders that do not exchange their DelavanSTC common stock will not be entitled to receive the merger consideration or any dividends or other distributions by Wintrust until their certificates are surrendered. After surrender of the certificates representing DelavanSTC shares, any unpaid dividends or distributions with respect to the Wintrust common stock represented by the certificates will be paid without interest.

Conduct of business pending the merger and certain covenants

Under the merger agreement, DelavanSTC has agreed to certain restrictions on its activities and the activities of its subsidiaries until the merger is completed or the merger agreement is terminated. In general, DelavanSTC and its subsidiaries are required to conduct their business in the ordinary course of business, consistent with soundprudent banking practice.

The following is a summary of the more significant restrictions imposed upon Delavan,STC, subject to the exceptions set forth in the merger agreement. DelavanSTC will not, and will cause its subsidiaries to not, without Wintrust’s prior written consent, which consent will not be unreasonably withheld, delayed or conditioned:

 

·make changes to the charter, articles of incorporation, articles of organization, operating agreement or by-laws, as applicable, of DelavanSTC and its subsidiaries;

 

·except with respect to the exercise of any outstanding DelavanSTC option, effect any change in the capitalization of DelavanSTC or its subsidiaries or the number of issued and outstanding shares of Delavan;

STC;

 

·subject to certain exceptions, increase the compensation of the officers or key employees of DelavanSTC or any of its subsidiaries or pay any bonuses, except in the ordinary course of business;

 

·make, renew or restructure any loan in the amount of $500,000$1,000,000 or more, except as provided for in the merger agreement;

 

pay or declare any dividends or other distributions;

·fail to use commercially reasonable efforts to maintain present insurance coverage in respect of their properties and businesses;

 

·make significant changes in the general nature of the business conducted by DelavanSTC or its subsidiaries;

 

·except as otherwise set forth in the merger agreement, enter into employment, consulting, or similar agreements that cannot be terminated with 30 days or fewer notice without penalty, or terminate the employment of any officer of DelavanSTC or its subsidiaries without prior notice to Wintrust;

 

·terminate, partially terminate, curtail or discontinue any of its benefit plans;

plans or merge a benefit plan into another plan or trust;

 

·fail to file any tax returns in a timely manner apply for or consent to an extension of time for filing or change accounting methods for income tax purposes;

 

·make any expenditure for fixed assets in excess of $100,000 for any single item, or $250,000$500,000 in the aggregate, or enter into any lease for any fixed assets having an annual rental in excess of $100,000;

 

·make or become party to a contract, agreement, commitment, disbursement or transaction, acquire or dispose of any property or asset, or incur any liabilities or obligations, other than in the ordinary course of business consistent with soundprudent banking practice and Delavan’sSTC’s and its subsidiaries’ current policies;

 

·do or fail to do anything that will cause a breach or default under any material contract;

·engage in any “covered transaction” within the meaning of Sections 23A or 23B of the Federal Reserve Act or any affiliate transaction, unless CommunitySTC Bank has complied with Sections 23A and 23B of the Federal Reserve Act;

·buy or invest in government securities that have maturities of more than tenfive years and a rating agency rating below “A”;

 

·accept or renew any brokered deposits or incur any additional Federal Home Loan Bank advances or other types of ordinary course wholesale in each case except as set forth in the merger agreement; or

 

change in

·                                          make any material changes with respect to any accountingof STC’s or recordkeepingits subsidiaries’ accounting procedures, methods, policies or practices.

practices or the manners in which they maintain their respective records.

Wintrust has agreed to file all other applications and notices to obtain the necessary regulatory approvals for the transactions contemplated by the merger agreement. DelavanSTC and CommunitySTC Bank have agreed to use all reasonable and diligent efforts and to assist in obtaining such regulatory approvals. Both parties agree:

 

·to use reasonable and diligent good faith efforts to satisfy the conditions required to close the merger and to consummate the merger as soon as practicable;

 

·that neither will intentionally act in a manner that would cause a breach of the merger agreement or that would cause a representation made in the merger agreement to become untrue; and

 

·                                          to use reasonable and diligent efforts to make representations and warranties true, unless otherwise waived; and

·to coordinate publicity of the transactions contemplated by the merger agreement to the media.

Delavan

STC has agreed to use reasonable and diligent efforts to preserve the reputation and relationship of DelavanSTC and its subsidiaries with suppliers, clients, customers, employees and others having business relations with Delavan,STC, and to provide Wintrust with certain documents before the closing date, including:

 

·reasonable notice, agendas, minutes and materials of any meetings of the boards, managers and committees of DelavanSTC or its subsidiaries, except as set forth in the merger agreement;

 

certain information regarding the loans in Community Bank’s loan portfolio;

surveys, title commitments,·                                          title policies and/or endorsements with respect to parcels of real property of DelavanSTC and its subsidiaries;
and

 

·interim financial statements; and

 

·                                          information relating to loans in the loan portfolio of STC Bank.

STC has agreed to provide prompt notice of certain events to Wintrust, including:

·                                          any written assertions of dissenters’ rights.

rights;

Delavan

·                                          the occurrence of any fact or circumstance that has a material adverse effect on STC or its subsidiaries or results in a breach of any representation or warranty or failure of certain closing conditions;

·                                          the assertion by any person that the consent of such person is required for the merger;

·                                          the receipt of material communications from governmental authorities; and

·                                          certain claims, actions or legal proceedings against STC or its subsidiaries.

STC has also agreed to the following:

 

·                                          to provide Wintrust with the opportunity to participate in any shareholder litigation relating to the merger, including negotiations and proceedings relating to the exercise of dissenters’ rights;

·to cause CommunitySTC Bank, prior to closing, to write off all loans that are required to be written off as loan losses; and

 

·to write down potential loan losses in conformity with past practices and policies of CommunitySTC Bank and general accepted accounting principles.

The merger agreement also contains certain covenants relating to employee benefits and other matters pertaining to officers and directors. See “—Employee benefit matters” and “The Merger—Interests of certain persons in the merger.”

No solicitation of or discussions relating to an acquisitiona company takeover proposal

The merger agreement contains provisions prohibiting DelavanSTC from seeking or discussing an alternative proposal to the merger. DelavanSTC has agreed to terminate existing discussions regarding any offer or proposal to acquire 15% or more of the consolidated assets, revenues or net income of STC or 15% or more of the outstanding stock of STC, which we refer to as a company takeover proposal, by another person or entity. STC has also agreed that it will not and will cause Community Bank not to, directly or indirectly solicit, encourage or facilitate any proposal or any inquiry or proposalcompany takeover proposals or enter into any agreement, negotiations or discussions with any person or entity concerning any proposed acquisition of Delavan or Community Bank,company takeover proposals, or furnish any information to any person or entity proposing or seeking such an acquisition.to make a company takeover proposal. However, the merger agreement provides that Delavanbefore receipt of shareholder approval of the merger agreement, STC may furnish such information pursuant to a customary confidentiality agreement no less restrictive than the confidentiality agreement between Wintrust and STC and engage in such negotiations or discussions in response to an acquisitiona proposal that was not solicited by DelavanSTC in violation of the merger agreement, if required by the fiduciary obligations of the board of directors and if the board determines in good faith and after consultation with outside counsel and STC’s independent financial advisor that it must do so in orderthe proposal constitutes a bona fide proposal to act inacquire 80% or more of the consolidated assets, revenues or net income of STC or 80% or more of the outstanding stock of STC, is more favorable to STC’s shareholders and is reasonably expected to be completed, which we refer to as a manner consistent with the board’s fiduciary duties.superior company proposal. STC is required to notify Wintrust of such action and concurrently provide to Wintrust copies of all nonpublic information made to such third party. STC is also required to notify Wintrust of any acquisition offer or proposal by another person or entity and to provide any written materials related thereto.

Notwithstanding the restrictions described above,

The board of directors of STC is not permitted to adversely modify its recommendation that STC’s shareholders approve the merger agreement provides that Delavan may provide information to and engage in discussions with third parties from whom Delavan has received an acquisition proposal that was not solicited in violation of the merger agreement, so long asagreement. However, if the board of directors of Delavan, after consultation with outside legal counsel, determines in good faith that such proposal constitutes a superior proposal. If the board of directors of DelavanSTC determines that it is necessary to pursue a superior company proposal in order to act in a manner consistent with its fiduciary duties, the board may withdraw, modify or otherwise change the board’s recommendation with respect to the merger and the merger agreement, and/or terminatebut only if shareholder approval of the merger agreement. However, the Delavanagreement has not yet been received. The STC board of directors may not terminate the merger agreement for a superior company proposal unless it has first notified Wintrust and otherwise negotiated with Wintrust so that the merger may be consummated. A “superior proposal” means any acquisition proposal containing terms that the Delavan board of directors determines in good faith (based on the advice of an independent financial advisor) to be more favorable to Delavan shareholders than the merger and for which financing, if required, is committed or, in the good faith judgment of the Delavan board of directors, reasonably capable of being obtained, but excludes any acquisition proposal known to the Delavan board of directors prior to the date of the merger agreement.

If Wintrust terminates the merger agreement because DelavanSTC breaches its covenant not to solicit an acquisitiona company takeover proposal from a third party, Delavanadversely modifies its recommendation to shareholders or fails to reaffirm its recommendation, or if Wintrust or STC terminates the merger agreement because STC enters into a definitive agreement related to a superior company proposal or under certain other circumstances after a person makes a company takeover proposal that is publicly disclosed before the shareholders’ meeting, and, in each case, STC consummates an company takeover proposal within 18 months, STC will pay to Wintrust a termination fee equal to $1,250,000$2,000,000 plus up to $250,000 in out-of-pocket expenses and costs. See “—Termination fee” below.

Representations and warranties

The merger agreement contains representations and warranties made by Delavan,STC, Wintrust and Merger Co. These include, among other things, representations relating to:

·valid corporate organization and existence;

 

·corporate power and authority to enter into the merger and the merger agreement;

 

·capitalization;

 

·                                          financial statements;

·certain tax matters;

 

·absence of material adverse changes;

 

·absence of undisclosed investigations and litigation;

 

·compliance with laws;

laws and regulations;

 

·third party consents and approvals;

 

·filing of necessary reports with regulatory authorities;

·broker/finder fees;

 

·                                          the accuracy of information supplied for inclusion in the registration statement;

·absence of omissions in the representations and warranties contained in the merger agreement; and

 

·absence of any breach of organizational documents, law or other agreements as a result of the merger.

Wintrust and Merger Co. also represent and warrant to DelavanSTC in the merger agreement regarding compliance with SEC filing requirements.

Delavan

STC makes additional representations and warranties to Wintrust in the merger agreement relating to, among other things:

 

·organizational documents, minutes and stock records;

 

financial statements;

·real property, personal property and other material assets;

 

·insurance matters;

 

·employee matters and employee benefits;

 

·environmental matters;

 

·ownership of its subsidiaries, including CommunitySTC Bank CBD, CB Investments, Inc., CBD Holdings, LLC, and Ponds of DarienCRE Real Estate, LLC;

 

·compliance with, absence of default under and information regarding material contracts;

 

·loans and its allowance for loan losses;

 

·investment securities;

·compliance with the Community Reinvestment Act;

 

·conduct of business and maintenance of business relationships;

 

·technology and intellectual property;

 

·absence of “excess parachute payments” resulting from the transactions contemplated in the merger agreement;

 

·absence of undisclosed liabilities; and

 

·                                          receipt of the fairness opinion of D.A. Davidson; and

·                                          conflicts of interest and affiliate transactions.

Conditions to completion of the merger

Closing Conditions for the Benefit of Wintrust. Wintrust’s obligations are subject to fulfillment of certain conditions, including:

 

·accuracy of representations and warranties of DelavanSTC in the merger agreement as of the closing date, except as otherwise set forth in the merger agreement;

·performance by DelavanSTC in all material respects of its agreements under the merger agreement;

 

·     ��                                    receipt of a certificate from a senior executive officer of STC certifying the accuracy of representations and warranties of STC as of the closing date, and a certificate from the secretary of STC certifying to the accuracy of the Company’s organizational documents and resolutions authorizing the merger agreement and incumbency matters;

·receipt of all necessary regulatory approvals;

 

·adoption of the merger agreement at the special meeting by the holders of at least a majority of the outstanding shares of DelavanSTC common stock entitled to vote;

 

·execution and delivery of articles of merger suitable for filing with the WDFI;

IL SOS;

 

·                                          not greater than 5% of the outstanding shares of STC common stock constituting or being eligible to dissent;

·no threatened or pending litigation seeking to enjoin the transactions contemplated by the merger agreement or seeking other relief that Wintrust reasonably believes, subject to certain conditions, would make it inadvisable to consummate the merger or would have a material adverse effect on DelavanSTC or CommunitySTC Bank;

 

·                                          no temporary restraining order, preliminary or permanent injunction or other order issued by a court of competent jurisdiction or other legal restraint or prohibition preventing the absenceconsummation of any environmental condition not previously disclosed to Wintrust related to certain real property owned by Delavan or its subsidiaries or in which Delavan or any of its subsidiaries has legal interest, as indicated or confirmed by the results of certain environmental surveys or reports, as set forth in the merger agreement (unless the aggregate merger consideration is reduced pursuant to the merger agreement);

merger;

 

·receipt of an opinion from Delavan’sSTC’s special counsel regarding the valid existence and the valid issuance of the capital stock of Delavan,STC, its authority to enter into the merger agreement and the due execution and delivery of the merger agreement by Delavan,STC, among other things;

 

·the capability of Michael J. Murphy to perform his duties under a previously executedentry into employment agreement with Community Bank as specified in the merger agreement;

or retention agreements by certain individuals;

·no material adverse change in DelavanSTC since October 13, 2014;
June 5, 2019, the date the merger agreement was signed;

 

·receipt of a consolidated balance sheetssheet of Delavan, Community Bank and its subsidiaries,STC, adjusted to reflect certain adjustments, specifications and charges, as set forth in the merger agreement;

 

·adjustment of the merger consideration, as applicable, as set forth in “—Consideration to be received in the merger—Adjustment to Merger Consideration”;

 

receipt of title commitments and surveys with respect to parcels of real property owned and used by Community Bank;

·receipt of all other necessary consents, permissions and approvals, which the failure to obtain would have a “materialmaterial adverse effect”effect with respect to DelavanSTC’s or Wintrust’s rights under the merger agreement; and

 

·the registration statement having been declared effective by the SEC and continuing to be effective as of the closing date.

date;

·                                          approval of the listing of the shares of Wintrust common stock issuable pursuant to the merger agreement on Nasdaq; and

·                                          the receipt of all other documents, certificates or instruments as may be requested evidencing STC’s compliance with the merger agreement.

Closing Conditions for the Benefit of DelavanSTC. Delavan’sSTC’s obligations are subject to fulfillment of certain conditions, including:

 

·accuracy of representations and warranties of Wintrust and Merger Co. in the merger agreement as of the closing date, except as otherwise set forth in the merger agreement;

 

·performance by Wintrust in all material respects of its agreements under the merger agreement;

 

·                                          receipt of a certificate from a senior executive officer of Wintrust certifying the accuracy of representations and warranties of Wintrust, and a certificate from a senior executive officer of Merger Co. certifying to the accuracy of the Merger Co.’s organizational documents and resolutions authorizing the merger agreement and incumbency matters;

·receipt of all necessary regulatory approvals;

·execution and delivery of the articles of merger suitable for filing with the WDFI;

IL SOS;

 

·no threatenedtemporary restraining order, preliminary or pending litigation seeking to enjoinpermanent injunction or other order issued by a court of competent jurisdiction or other legal restraint or prohibition preventing the transactions contemplated byconsummation of the merger agreement or seeking other relief that Delavan reasonably believes, subject to certain conditions, would make it inadvisable to consummate the merger or would have a material adverse effect on Wintrust;

merger;

 

·receipt of an opinion from Wintrust’s special counsel regarding the valid existence of Wintrust and Merger Co., their authority to enter into the merger agreement and due execution and delivery of the merger agreement by Wintrust and Merger Co. and the issuances of shares of Wintrust common stock in the merger,, among other things;

 

·receipt of a tax opinion from Delavan’s accountantsSTC’s special counsel that the merger constitutes a “reorganization” within the meaning of Section 368(a) of the Code;

 

·no material adverse change in Wintrust since October 13, 2014;

June 5, 2019, the date the merger agreement was signed;

 

·the registration statement having been declared effective by the SEC and continuing to be effective as of the closing date; and

·approval of the listing of the shares of Wintrust common stock issuable pursuant to the merger agreement on NASDAQ.
Nasdaq;

·                                          the execution and delivery of an assignment agreement by STC Bank, the litigation entity, Merger Co. and Wintrust relating to the assignment to the shareholders’ representative of all rights and obligations related to certain customer litigation; and

·                                          the receipt of all other documents, certificates or instruments as may be requested evidencing Wintrust’s compliance with the merger agreement.

TerminationTermination

By written agreement, Wintrust and DelavanSTC may mutually agree to terminate the merger agreement and abandon the merger at any time. Subject to conditions and circumstances described in the merger agreement, either Wintrust or DelavanSTC may also terminate the merger agreement as follows:

 

·the merger is not completed (other than through the failure of any party seeking to terminate the agreement to comply fully with its material obligations under the merger agreement) by January 31, 2015February 29, 2020 or such later date agreed to by the parties; provided, that the termination date will be extended to MarchMay 31, 20152020 if the sole impedimentsimpediment to closing areis due to delay in receiving regulatory approval from the Federal Reserve or the Wisconsin Department of Financial Institutions;

Reserve;

 

·the other party has not satisfiedmaterially breached any of its representations, warranties or covenants that resulted in a failure of any condition under the merger agreement required to be met by it to be satisfied prior to the closing date and such breach is not cured within a specified period of time, or if it becomes impossible for the other party to satisfy a condition and its inability to satisfy the condition was not caused by the non-breaching party’s failure to meet any of its obligations under the merger agreement and, in each case, such non-breaching party has not waived such condition; or

 

Delavan receives

·                                          shareholder approval of the merger agreement and acceptsthe transactions contemplated therein is not obtained; or

·                                          STC enters into a definitive agreement related to a superior company proposal, as defined above in “—No solicitation of or discussions relating to an acquisitiona company takeover proposal.”

In addition, Delavan may terminate the merger agreement if the reference price is less than $36.50 and Wintrust may terminate the merger agreement if the reference price is more than $52.50, in each case if Delavan and Wintrust are in good faith unable, after five business days’ notice of such termination, to reach agreement as to an amendment to the merger agreement containing terms acceptable to Wintrust and Delavan so that the merger and the transactions contemplated by the merger agreement may be consummated.

Wintrust may also terminate if Delavan has breached any representation, warranty, covenant, obligation or other agreement in the merger agreement that would result in the failureboard of any condition underdirectors of STC adversely modifies its recommendation of approval of the merger agreement to be satisfied, cannot be curedSTC’s shareholders, fails to reaffirm such recommendation of approval within ten days of Wintrust’s request to do so, or recommends an alternative company takeover proposal, as defined above in “—No solicitation of or discussions relating to a specified period of time andcompany takeover proposal.” In addition, Wintrust has not waived such condition,may terminate if a legal restraint, injunction or in certain circumstances uponorder prevents the identification or confirmation of the presenceenforcement of certain environmental conditions relatedprovisions relating to certain real property, as described above in “—Consideration to be received in the merger—Adjustment to Merger Consideration.”

termination fees and exclusivity.

Any termination of the merger agreement will not affect any rights accrued prior to such termination.termination, except as otherwise provided in the merger agreement.

Termination fee

Termination Fees Payable by Delavan.STC. DelavanSTC has agreed to pay Wintrust a termination fee of $1,250,000$2,000,000 plus up to $250,000 in out-of-pocket expenses and costs if the merger agreement is terminated under the following circumstances:circumstances and within 18 months of such termination STC consummates the transactions contemplated by another company takeover proposal:

 

·Wintrust terminates the merger agreement because DelavanSTC breaches its covenant not to solicit an acquisitiona company takeover proposal from a third party;

party and such breach cannot be cured within a certain time period;

Delavan·                                          Wintrust or STC terminates the merger agreement because STC enters into a definitive agreement related to a superior company proposal;

·                                          Wintrust terminates the merger agreement because STC’s board of directors adversely modifies its recommendation that STC’s shareholders approve the merger agreement, fails to reaffirm such recommendation upon the entry into, consummation ofWintrust’s request or the Delavan board’s determination to acceptrecommends an unsolicited superioralternative company takeover proposal; or

 

·                                          any person or entity makes a company takeover proposal that is publicly disclosed before the shareholders’ meeting and thereafter, the merger agreement is terminated (a) by either Wintrust or DelavanSTC because the closing has not occurred by January 31, 2015February 29, 2020 or such later date agreed to by the parties (or MarchMay 31, 2015,2020, if the sole impediment to closing is due to delay in receiving regulatory approval from the Federal Reserve or the Wisconsin Department of Financial Institutions) orReserve); (b) by Wintrust because DelavanSTC has breached any of its representations, warranties, covenants, obligations or other agreements in the merger agreement such that a condition to closing is not satisfied and such breach cannot be cured within a certain time period, or because a condition to Wintrust’s obligations becomes impossible for DelavanSTC to satisfy and, in each case, Wintrust has not waived such condition, and in each such case, within six months after terminationcondition; (c) by either party because shareholder approval of the merger agreement Delavan or Community Bank consummates or enters into a definitive agreement relating to an acquisition proposal which was made known to any member of Delavan’s or Community Bank’s board of directors and not disclosed to Wintrust prior to the date of such termination.

obtained.

Delavan

STC has agreed to pay to Wintrust a termination fee of $750,000 plus up to $250,000 in$1,000,000 inclusive of any out-of-pocket expenses and costs if the merger agreement is terminated by Wintrust because DelavanSTC committed a material breach of its material obligations under the merger agreement and such breach is not the result of Wintrust’s failure to comply or perform in all material respects with any of its material obligations under the merger agreement.

If the merger agreement is terminated in other circumstances due to failure to obtain shareholder approval of the merger agreement, STC has agreed to reimburse Wintrust for up to $250,000 in out-of-pocket costs and expenses.

Termination Fees Payable by Wintrust.Wintrust has agreed to pay to DelavanSTC a termination fee of $750,000 plus up to $250,000 in$1,000,000 inclusive of any out-of-pocket expenses and costs if the merger agreement is terminated under the following circumstances by DelavanSTC because Wintrust committed a material breach of its material obligations under the merger agreement and such breach is not the result of DelavanSTC or CommunitySTC Bank’s failure to comply or perform in all material respects with any of its material obligations under the merger agreement.

Management of Wintrust and the surviving corporationcompany after the merger

After the merger, the Wintrust board of directors will remain the same and the Merger Co. board of directorsmanagers will continue to serve as the directorsmanagers of the surviving corporation.company.

Employee benefit matters

Pursuant to the merger agreement, former full-time employees of DelavanSTC and CommunitySTC Bank who became employed by Wintrust will be eligible to participate in employee benefit plans that Wintrust sponsors or maintains at the effective time of the merger on the same terms and conditions as all other similarly-situated U.S. employees of Wintrust and its subsidiaries. To the extent such employees participate in any Wintrust benefit plans, such employees will be given credit for amounts paid under a corresponding DelavanSTC or CommunitySTC Bank benefit plan during the plan year in which the closing of the merger occurs for purposes of applying deductibles, co-payments and out-of-pocket maximums as though such amounts had been paid in accordance with the terms and conditions of such Wintrust benefit plan for the plan year in which the closing of the merger occurs. For purposes of determining eligibility to

participate in and, where applicable, vesting under Wintrust’s applicable retirement savings plan and employee stock purchase plan, Wintrust’s short-term disability plans and vacation policy, each former employee of DelavanSTC or CommunitySTC Bank will receive past service credit for his or her prior employment with DelavanSTC or CommunitySTC Bank as if each such employee had then been employed by Wintrust. Wintrust reserves the right to amend or terminate these plans and arrangements in accordance with the terms of such plans and arrangements and applicable laws.

ExpensesExpenses

All expenses incurred in connection with the merger agreement will be paid by the party incurring the expenses. As more fully described above under “—Termination fee,” Wintrust and DelavanSTC have also agreed to reimburse each other for certain expenses incurred not exceeding $250,000 in the event the merger is terminated prior to the closing date for certain specified reasons.

NASDAQNasdaq stock listing

Wintrust common stock currently is listed on NASDAQNasdaq under the symbol “WTFC.” The shares to be issued to Delavan’sSTC’s shareholders as merger consideration also will be eligible for trading on NASDAQ.Nasdaq.

AmendmentAmendment

The merger agreement was amended by the parties on November 19, 2014, as set forth in Annex A.

The merger agreement may be further amended in writing by the parties.parties before or after receipt of shareholder approval of the merger agreement, provided that any amendment made after such receipt that requires shareholder approval is so approved.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT OF DELAVANSTC

The following table shows, as of October 31, 2014,June 15, 2019, the beneficial ownership of DelavanSTC common stock of each person who beneficially owns more than 5% of Delavan’sSTC’s outstanding common stock, of each DelavanSTC director, of each of the executive officers of DelavanSTC and all of Delavan’sSTC’s directors and officers as a group. Except as otherwise noted in the footnotes to the table, each individual has sole investment and voting power with respect to the shares of common stock set forth. Except as indicated in the footnotes to the table below, the business address of the persons listed below is c/o DelavanSTC Bancshares Inc.Corp., 820 Geneva460 S. 1st Street, Delavan, Wisconsin 53115.St. Charles, Illinois 60174.

 

Name

  Common Stock directly,
indirectly or beneficially owned
as of

October 31, 2014
   Percent of
Outstanding
 

Directors and Executive Officers

    

Debra J. Alder(1)

   14,741     3.94

Donald J. Boltz(2)

   24,915     6.66

J. Edward Clair(3)

   9,509     2.54

Gregg Kunes(4)

   5,147     1.38

Michael J. Murphy(5)

   39,167     10.27

Thomas R. Neshek(6)

   23,494     6.28

James R. Saer(7)

   20,658     5.52

All directors and executive officers as a group (7 persons)

   137,631     36.10

Other Significant Shareholders

    

Elton K. and Esperanza Feffer

540 S. Second Street

Delavan, WI 53115

   24,750     6.62

Robert P. Fettig(8)

N2900 Foundry Road

Darien, WI 53114

   26,842     7.18

Michael K. Keefe(9)

PO Box 460

Lake Geneva, WI 53115

   20,522     5.49

Name

 

Common Stock
directly, indirectly
or beneficially
owned as of June
15, 2019

 

Percent of
Outstanding

 

Directors and Executive Officers

 

 

 

 

 

Anthony V. Sisto(1)

 

36,975

 

8.2

%

Christopher Woelffer(2)

 

17,107

 

3.7

%

Eduardo E. Greco(3)

 

14,067

 

3.1

%

Edward N. Levato Sr.(4)

 

35,628

 

7.9

%

Keith Kotche(5)

 

28,428

 

6.3

%

Gregory Licht(6)

 

10,510

 

2.3

%

James D. Parrilli Jr.(7)

 

14,795

 

3.3

%

Thomas B. Spoden(8)

 

8,414

 

1.8

%

Charles S. Wolande(9)

 

43,629

 

9.7

%

W. Philip Wilmington(10)

 

24,510

 

5.4

%

James Weitl(11)

 

6,495

 

1.4

%

All directors and executive officers as a group (11 persons)

 

240,558

 

50.2

%

Other Significant Shareholders

 

 

 

 

 

Philip E. or Victoria K. Corcoran
423 S. 2
nd Street, St. Charles, Illinois 60174

 

30,000

 

6.7

%

 

*Indicates that the individual or entity owns less than one percent of Delavan’s

*                 Indicates that the individual or entity owns less than one percent of STC’s common stock.

(1)9,605 shares are held by the Jeffrey G. Scherer IRA (Jeffrey Scherer is Debra Alder’s spouse), and 2,500 shares voted by Debra Alder as Personal Representative for George W. and Mary Gene Alder, her parents.
(2)8,189 of the listed shares are owned by Donald J. Boltz Roth IRA, 3,476 are owned by Donald J. Boltz Individual K, 4,718 are owned by his spouse, Donna J. Boltz, 2,113 are owned by spouse Donna J. Boltz Roth IRA, 20 are owned by his son, Nathan J. Boltz and 771 by son Nathan J. Boltz Roth IRA.
(3)2,370 of the listed shares are owned by the J. Edward & Patricia D. Clair Revocable Trust dated 7/01/2002 with J. Edward Clair as Trustee, 4,359 are owned by J. Edward Clair IRA and 2,780 are owned by the J. Edward & Patricia D Clair Family Trust dated 7/01/2002 with his son, John M. Clair as Trustee.
(4)1,174 of the listed shares are owned jointly with his spouse, Deborah A. Kunes.
(5)23,586 of the listed shares are owned by the Michael and Carol Murphy Revocable Living Trust dated 6/22/2006, and as it may subsequently be amended, with Michael J. & Carol J. Murphy, or their successors, as Trustees, 7,250 are issuable upon the exercise of outstanding options granted under the Delavan Bancshares, Inc. 2004 Executive Stock Option Plan, 7,469 are owned by Michael J. Murphy IRA, 217 are owned by his spouse, Carol J. Murphy IRA, 215 by his daughter, Brittany R. Murphy over which Mr. Murphy has power of attorney, 215 by his son, Travis J. Murphy over which Mr. Murphy has power of attorney and 215 are owned by his son, Shawn M. Murphy over which Mr. Murphy has power of attorney.
(6)17,936 of the listed shares are owned by the Thomas R. & Donna J. Neshek Revocable Living Trust dated 9/27/2006 with Thomas & Donna Neshek as Trustees, 1,750 are owned by Thomas R. Neshek IRA, 450 are owned by Donna J. Neshek IRA, and 3,358 are owned by the Darlene Joan Neshek Family Trust with Thomas R. Neshek as Trustee.

(7)13,158 of the listed shares are owned by the James R. & Marcia P. Saer Revocable Trust dated 10/10/2012 with James R. & Marcia P. Saer as Co-Trustees, 2,500 are owned by James R. Saer IRA Rollover, and 5,000 are owned by James R. Saer Roth Contributory IRA.
(8)2,980 of the listed shares are owned by his spouse, Mary Ellen Fettig and 990 are owned by his daughter, Laura M. Fettig.
(9)4,167 of the listed shares are owned by the Alexander A. Keefe Trust dated 10/4/1982 with Michael K. Keefe as Trustee, 4,167 are owned by the Thomas H. Keefe Trust dated 10/4/1982 with Michael K. Keefe as Trustee and 3,089 are owned by the Catharine K. Keefe Trust dated 10/4/1982 with Michael K. Keefe as Trustee.
(1)         Includes 2,185 shares underlying options exercisable within 60 days of June 15, 2019.

(2)         Includes 12,107 shares underlying options exercisable within 60 days of June 15, 2019.

(3)         Includes 510 shares underlying options exercisable within 60 days of June 15, 2019.

(4)         Includes 510 shares underlying options exercisable within 60 days of June 15, 2019.  Includes shares over which Mr. Levato shares investment and voting power.  Includes 2,000 shares over which Mr. Levato’s spouse has investment and voting power and over which Mr. Levato disclaims beneficial ownership.

(5)         Includes 510 shares underlying options exercisable within 60 days of June 15, 2019.  Includes shares over which Mr. Kotche shares investment and voting power.

(6)         Includes 510 shares underlying options exercisable within 60 days of June 15, 2019.

(7)         Includes 510 shares underlying options exercisable within 60 days of June 15, 2019.

(8)         Includes 7,185 shares underlying options exercisable within 60 days of June 15, 2019.

(9)         Includes 510 shares underlying options exercisable within 60 days of June 15, 2019.

(10)  Includes 510 shares underlying options exercisable within 60 days of June 15, 2019.Includes shares over which Mr. Wilmington shares investment and voting power.

(11)  Includes 4,495 shares underlying options exercisable within 60 days of June 15, 2019.

 

The information presented in the table is based on information furnished by the specified persons and was determined in accordance with Rule 13d-3 under the Securities Exchange Act of 1934, as amended, which we refer to as the Securities Exchange Act, as required for purposes of this proxy statement/prospectus. Briefly stated, under that Rule shares are deemed to be beneficially owned by any person or group having the power to vote or direct the vote of, or the power to dispose or direct the disposition of, such shares, or who has the right to acquire beneficial ownership thereof within 60 days. Beneficial ownership for the purposes of this proxy statement/prospectus is not necessarily to be construed as an admission of beneficial ownership for other purposes.

COMPARISON OF RIGHTS OF WINTRUST SHAREHOLDERS AND DELAVANSTC SHAREHOLDERS

GeneralGeneral

As a shareholder of Delavan,STC, your rights are governed by Delavan’sSTC’s articles of incorporation and its by-laws, each as currently in effect. Upon completion of the merger, the rights of DelavanSTC shareholders who receive shares of Wintrust common stock in exchange for their shares of DelavanSTC common stock and become shareholders of Wintrust will be governed by Wintrust’s amended and restated articles of incorporation and amended and restated by-laws, as well as the rules and regulations applying to public companies. Wintrust isand STC are both incorporated in Illinois and isare subject to the Illinois Business Corporation Act, as amended, which we refer to as the IBCA. Delavan is incorporated in Wisconsin and is subject to the WBCL.

The following discussion summarizes material similarities and differences between the rights of DelavanSTC shareholders and Wintrust shareholders and is not a complete description of all of the differences. This discussion is qualified in its entirety by reference to the IBCA and WBCL and Wintrust’s and Delavan’sSTC’s respective articles of incorporation and by-laws.

 

Wintrust Shareholder Rights

DelavanSTC Shareholder Rights

Authorized Capital Stock:

Wintrust is authorized to issue 100 million shares of common stock, no par value per share, and 20 million shares of preferred stock, no par value per share, which we refer to as Wintrust preferred stock. Of the 20 million shares of Wintrust preferred stock, (i) 50,000five million have been designated 8.00%as “Fixed-to-Floating Rate Non-Cumulative Perpetual Convertible Preferred Stock, Series A,D,” which we refer to as Wintrust series A preferred, and (ii) 126,500 have been designated 5.00% Non-Cumulative Perpetual Convertible Preferred Stock, Series C, which we refer to as Wintrust series CD preferred.

 

On September 30, 2014,March 31, 2019, Wintrust had 46,691,04756,638,968 shares of common stock outstanding noand 5,000,000 shares of Wintrust series A preferred outstanding and 126,467 shares of Wintrust series CSeries D preferred outstanding. Further issuance of shares of Wintrust’s preferred stock could affect the relative rights of the holders of its common stock, depending upon the exact terms, qualifications, limitations and relative rights and preferences, if any, of the shares of the preferred stock as determined by Wintrust’s board of directors.

DelavanSTC is authorized to issue 400,000two million shares of common stock, par value $1.00$0.01 per share.

 

On November 25, 2014 DelavanJune 30, 2019, STC had 373,989449,229 shares of common stock outstanding, and 2,489no shares held in treasury.

Wintrust Shareholder Rights

Delavan Shareholder Rights

Dividends:

Subject to any rights ofto receive dividends to which holders of Wintrust preferred stock may be entitled, Wintrust may pay dividends if, as and when declared payable from time to time by its board of directors from any funds legally available therefor.

Delavan

STC may pay dividends if, as and whenmay be declared from time to time by its board of directors from any funds legally available therefor.in the manner and upon the terms and conditions provided by law and its articles.

Wintrust Shareholder Rights

STC Shareholder Rights

Voting Securities Held by the Corporation

Wintrust’s by-laws provide that voting securities belonging to the corporation shall not be voted, directly or indirectly, at any meeting and shall not be counted in determining the total number of outstanding shares at any given time, but shares of its own stock held by the corporation in a fiduciary capacity may be voted and shall be counted in determining the total number of outstanding shares at any given time.

STC’s by-laws provide that voting securities held by the corporation in a fiduciary capacity may be voted and shall be counted in determining the total number of outstanding shares entitled to vote at any given time. The president or vice president has full power and authority to attend, act, vote and consent on behalf of the corporation at any meetings of security holders of corporations in which the corporation may hold securities.

Number of Directors, Classification:

The Wintrust board of directors currently consists of thirteen (13)twelve (12) members. Wintrust’s by-laws provide, however, that the number may be increased or decreased (provided the number is never less than nine (9)) by an amendment of the by-laws by the shareholders, or by a resolution adopted by the majority of the board of directors.

 

Wintrust’s board of directors consists of a single class of directors.

The DelavanSTC board of directors currently consists of seven (7)ten (10) members. Delavan’sSTC’s articles of incorporation and by-laws provide that the number of directors must be eight (8)a minimum of ten (10) and a maximum of fifteen (15). The number may be increased or decreased by an amendment of the by-laws by the shareholders, orwithin this range by a resolution adopted by the majority75% of the board of directors.

 

Delavan’sSTC’s board of directors is divided into three classes, with each class consisting of approximately one-third of the total number of directors. Directors are elected for three-year terms, with one class of directors up for election at each annual meeting of shareholders.

Wintrust Shareholder Rights

STC Shareholder Rights

Election of Directors; Vacancies:

Each Wintrust shareholder is entitled to vote the number of shares owned by such shareholder for as many persons as there are directors to be elected. The IBCA requires that directors be elected by the affirmative vote of a majority of the shares represented at the meeting and entitled to vote thereon.

 

The Wintrust by-laws provide that no cumulative voting is permitted.

 

Wintrust’s by-laws provide that any vacancy on the board of directors may be filled at an annual meeting or special meeting of the shareholders called for such purpose, or if such vacancy arises between meetings of shareholders, by a majority vote of the board of directors then in office.

Each Delavan shareholderholder of STC common stock is entitled to one vote the numberin respect of shares owned by such shareholder. Directors shalleach share of stock. The IBCA requires that directors be elected by the affirmative vote of a plurality vote.majority of the shares represented at the meeting and entitled to vote thereon.

 

Delavan’sThe STC articles of incorporation and by-laws do not provide forthat no cumulative voting.voting is permitted.

 

Delavan’sSTC’s by-laws provide that any vacancy on the board of directors between meetings of shareholders by reason of an increase in the number of directors or otherwise may be filled by director or shareholder action. STC’s articles of incorporation and by-laws provide that any vacancy for any reason, including any directorships arising from any increase in the number of directors, may be filled by the shareholders, and during such time as the shareholders fail or are unable to fill such vacancies, the vacancy may be filledboard, acting by a majority vote75% of the board of directors then in office.office, although less than a quorum.

Removal of Directors:

A Wintrust director may be removed at a shareholders’ meeting, with or without cause, by the affirmative vote of a majority of the outstanding shares entitled to vote.

A DelavanSTC director may be removed, from officeonly for cause, at a meeting of shareholders by the affirmative vote of the holders of a majority of the outstanding shares then entitled to vote at an election of directors, provided that the notice of such meeting states that a purpose of the meeting is to vote upon the removal of such director. Cause exists only if the director has been convicted of a felony or has been adjudged in a final, non-appealable order to be liable for gross negligence or willful misconduct in the performance of such director’s duty to the corporation.

A director elected by a voteclass or series of shares may be removed only by the shareholders taken at any shareholders’ meeting called forof that purpose, provided that a quorum is present.

Wintrust Shareholder Rights

Delavan Shareholder Rightsclass or series.

Call of Special Meeting of Directors:

Wintrust’s by-laws provide that a special meeting of the board of directors may be called by or at the request of the chairman of the board, president or a majority of then-acting directors.

Delavan’s

STC’s by-laws provide that a special meeting of the board of directors may be called by or at the request of the chairpersonchairman of the

Wintrust Shareholder Rights

STC Shareholder Rights

board, if any,president or bya majority of then-acting directors.

board, the president secretary, or any threea majority of the then-acting directors.

Limitation on Director Liability:

Wintrust’s articles of incorporation provide that no director will be personally liable to the corporation or any of its shareholders for monetary damages for any breach of fiduciary duty except for liability:

 

·                  for any breach of the director’s duty of loyalty to the corporation or its shareholders;

 

·                  for acts and omissions not in good faith or that involve intentional misconduct or a knowing violation of law;

 

·                  under Section 8.65 of the IBCA (which creates liability for unlawful payment of dividends and unlawful stock purchases or redemptions)distributions to shareholders), as it exists or hereafter may be amended; or

 

·                  for any transaction from which the director derived an improper personal benefit.

UnderSTC’s articles of incorporation and by-laws provide that, to the WBCL, afullest extent permitted by the IBCA, no director is notwill be personally liable to Delavan, its shareholders, or any person asserting rights on behalf of Delavanthe corporation or its shareholders for monetary damages settlements, fees, fines, penalties or other monetary liabilities arising from afor breach of or failure to perform,fiduciary duty. Under the IBCA, a corporation may not limit directors’ liability:

·                  for any duty resulting solely from his or her status as a director, unless the person asserting liability proves that the breach or failure to perform constitutes any of the following:director’s duty of loyalty to the corporation or its shareholders;

 

·                  for acts and omissions not in good faith or that involve intentional misconduct or a willful failure to deal fairly with Delavan or its shareholders in connection with a matter in which the director has a material conflictknowing violation of interest;law;

 

•    a violation·                  under Section 8.65 of criminal law, unless the director had reasonable causeIBCA (which creates liability for unlawful distributions to believe that hisshareholders), as it exists or her conduct was lawfulhereafter may be amended; or no reasonable cause to believe that his or her conduct was unlawful;

 

•    a·                  for any transaction from which the director derived an improper personal profit; or

•    willful misconduct.benefit.

Indemnification:

Wintrust’s articles of incorporation and by-laws provide that the corporation has the power to indemnify its directors, officers, employees and agents to the fullest extent authorized by the IBCA.

 

The by-laws provide that, to the extent a present or former director, officer or employee of the corporation (or of any subsidiary, as

Delavan’s articles of incorporation and by-laws provide for indemnification of its officers and directors to the fullest extent authorized by the WBCL.

The by-laws provide for indemnification of Delavan’s employees who are not a director or officer of the corporation, to the extent such person has been

Wintrust Shareholder Rights

Delavan Shareholder Rights

the case may be) has been successful on the merits or otherwise in defense of any proceeding, or in connection with any claim, issue or matter therein, the corporation shall indemnify the director or officer against expenses actually and reasonably incurred by him in connection with such

STC’s articles of incorporation and by-laws provide for indemnification of its present and former officers and directors and each person who serves or served at the request of the corporation as a director, officer or partner of another enterprise to the fullest extent authorized by the IBCA.

Under the IBCA, a corporation may indemnify present and former directors and officers against expenses, judgments, fines, and settlement amounts actually and reasonably incurred in the proceeding, provided that such person acted in good faith and in a manner he reasonably believed was in or not opposed to the

Wintrust Shareholder Rights

STC Shareholder Rights

proceeding to the extent he was a party as a result of being a director, officer or employee, provided that such person acted in good faith and in a manner he or she reasonably believed to be in, or not opposed to, the best interests of the corporation. The board may indemnify agents of the corporation in this context.

 

Wintrust has entered into individual indemnification agreements with each of its non-employee directors and certain of its executive officers, which we refer to as the indemnification agreements, which implement with more specificity the indemnification provisions provided by Wintrust’s by-laws and provide, among other things, that to the fullest extent permitted by applicable law, Wintrust will indemnify such director or officer against any and all losses, expenses and liabilities arising out of such director’s or officer’s service as a director or officer of Wintrust, as the case may be. The indemnification agreements also contain detailed provisions concerning expense advancement and reimbursement. The indemnification agreements are in addition to any other rights each non-employee director or officer may be entitled to under Wintrust’s articles of incorporation, by-laws and applicable law.

corporation’s best interests, and in the case of any criminal proceeding, had no reasonable cause to believe his or her conduct was unlawful. To the extent that a present or former director or officer been successful, on the merits or otherwise, in the defense of any proceeding for allor any claim, issue or matter therein, such person shall be indemnified against expenses (including attorneys’ fees) actually and reasonably incurred by him or hersuch person in connection with such proceeding totherewith, if the extent he or she was a party as a result of being an employee, provided that such person acted in good faith and in a manner he or she reasonably believed to be in, or not opposed to, the best interests of the corporation.

Call of Special Meetings of Shareholders:

Wintrust’s by-laws provide that a special meeting of the shareholders may be called by the board of directors, the president or the holders of not less than one-fifth of all the outstanding shares entitled to vote on the matter for which the meeting is called, for the purpose or purposespurpose(s) stated in the call of the meeting.

Delavan’s by-laws provide that a special meeting of the shareholders may be called by the president, by the board of directors or such other officer(s) as the board of directors may authorize, or by the president or secretary at the written request of the holders of at least 10% of all outstanding capital stock entitled to vote.

Wintrust Shareholder Rights

Delavan Shareholder Rights

Written notice stating the place, date, hour and purpose(s) of the special meeting must be delivered, either personally or by mail, not less than ten (10) nor more than

STC’s by-laws provide that a special meeting of the shareholders may be called by the chairman of the board of directors, the president, the board of directors or the holders of not less than one-fifth of all the outstanding shares of the corporation entitled to vote on the matter for which the meeting is called, upon notice by such holders to the secretary of the corporation. The request for a special meeting shall state the purpose(s) of the meeting.

Written notice stating the place, date, hour and purpose(s) of the

Wintrust Shareholder Rights

STC Shareholder Rights

sixty (60) days before the date of the meeting.

Notice stating the place, date, time and purpose(s) of the

special meeting must be delivered, either personally or by mail, not less than ten (10) nor more thatthan sixty (60) days before the date of the meeting.

Quorum of Shareholders:

Wintrust’s by-laws provide that a majority of the votes of shares entitled to vote on a matter, present in person or represented by proxy, constitutes a quorum at any meeting of shareholders.

Delavan’s

STC’s by-laws provide that a majority of the outstanding shares entitled to vote thereat,on a matter, present in person or represented by proxy, constitutes a quorum for consideration of such matter at any meeting of shareholders.shareholders, provided that a quorum shall not consist of less than one-third of the outstanding shares entitled to vote.

Advance Notice Regarding Shareholders Proposals (other than Nomination of Candidates for Election to the Board of Directors):

Wintrust’s by-laws provide that for a shareholder to properly bring business before an annual or special meeting of shareholders, written notice of such shareholder’s intent to make such proposal(s) must be given by personal delivery or U.S. mail postage prepaid and received by the secretary of the corporation no later than the following dates: (i) with respect to an annual meeting of shareholders, not less than 90 days nor more than 120 days prior to the anniversary date of the immediately preceding annual meeting of shareholders (provided, however, that in the event that the annual meeting is called for a date that is not within 30 days before or after such anniversary date, notice by the shareholder to be timely must be so delivered or received not later than the close of business on the 10th10th day following the earlier of the date on which such notice or public disclosure of the date of the meeting was given or made); and (ii) with respect to any special meeting of shareholders, the close of business on the 10th day following the date of public disclosure of the date of such meeting.

 

A shareholder’s notice to the secretary shall set forth as to each item of business the shareholder proposes to bring before such

Delavan’s

STC’s by-laws provide that anyfor a shareholder to properly bring business properly brought before the meeting may be transacted at an annual meeting of shareholders, a written statement of such new business must be filed with the secretary of the corporation on or before 60 days in advance of the first anniversary date (month and a special meetingday) of the previous year’s annual meeting. Any shareholder proposal may be called for any purpose.discussed and considered at the annual meeting, but unless such proposal was filed in accordance with the advance notice procedures, such proposal may only be voted upon at a meeting held at least 30 days after the annual meeting at which it is presented. No other shareholder proposal may be acted upon at the annual meeting.

Wintrust Shareholder Rights

DelavanSTC Shareholder Rights

proposes to bring before such

meeting: (a) a brief description of the business desired to be brought before the meeting and the reasons for conducting the business at the meeting; (b) the name and record address of the shareholder who proposes such business; (c) the number and class of shares of stock of the corporation beneficially owned by such shareholder; (d) whether and the extent to which any derivative instrument, hedging or other transaction or series of transactions has been entered into by or on behalf of, or any other agreement, arrangement or understanding (including any short position or any borrowing or lending of shares) has been made the effect or intent of any of which is to increase or decrease economic interest in the corporation’s stock or manage the risk or benefit of share price changes for, or to increase or decrease the voting power of, such shareholder with respect to the corporation’s stock (which information shall be updated by such shareholder as of the record date for the meeting, such update to be provided not later than 10 days after the record date for the meeting); (e) a representation that the shareholder intends to appear in person or by proxy at the meeting to introduce the item of business proposed to be brought before the meeting; (f) a description of all arrangements or understandings between the shareholder and any other person(s) pursuant to which the proposal or proposals are to be made by the shareholder and any material interest of the shareholder in the business being proposed; and (g) all other information which would be required to be included in a proxy statement filed with the SEC if, with respect to any such item of business or nomination, such shareholder were a participant in a solicitation subject to Section 14 of the Securities Exchange Act.

Wintrust Shareholder Rights

DelavanSTC Shareholder Rights

Advance Notice Regarding Shareholders Nomination of Candidates for Election to the Board of Directors:

Wintrust’s by-laws provide that nominations of persons for election to the board of directors may be made at an annual or special meeting of shareholders by a shareholder of Wintrust.

 

For nominations for election to the board of directors of Wintrust to be properly brought before an annual or special meeting, written notice of such shareholder’s intent to make such proposal(s) must be given by personal delivery or U.S. mail postage prepaid and received by the secretary of the corporation no later than the following dates: (i) with respect to an election to be held at an annual meeting of shareholders, not less than 90 days nor more than 120 days prior to the anniversary date of the immediately preceding annual meeting of shareholders (provided, however, that in the event that the annual meeting is called for a date that is not within 30 days before or after such anniversary date, notice by the shareholder to be timely must be so delivered or received not later than the close of business on the 10th day following the earlier of the date on which such notice or public disclosure of the date of the meeting was given or made); and (ii) with respect to an election to be held at any special meeting of shareholders called for the purpose of electing directors, the close of business on the 10th10th day following the date of public disclosure of the date of such meeting.

 

A shareholder’s notice to the secretary shall set forth each item described above under Advance“Advance Notice Regarding Shareholders Proposals (other than Nomination of Candidates for Election to the Board of Directors)” as well as (a) the nominee’s name, age, principal occupation and employment, business and residence addresses and qualifications, (b) a description of all arrangements or understandings between the

Delavan’s

STC’s by-laws do not address shareholder nominationprovide that nominations of candidatesperson for election to the board of directors.directors at any meeting of shareholders may be made by any shareholder of record entitled to vote at such meeting.

For nominations for election to the board of directors of STC to be properly brought before an annual meeting, written notice must be delivered to, or mailed to and received by, the secretary of the corporation, for an annual meeting, not less than 90 days nor more than 120 days in advance of the first anniversary date (month and day) of the previous year’s annual meeting, and for a special meeting, not less than 90 days nor more than 120 days in advance of the date (month and day) of the special meeting, regardless of any postponement or adjournments of that meeting to a later date.

A shareholder’s notice to the secretary shall set forth (a) as to each person whom the shareholder proposes to nominate for election as a director: (i) the name, age, business address and residential address of such person; (ii) the principal occupation or employment of such person; (iii) the class and number of shares of the corporation’s stock which are beneficially owned by such person on the date of such shareholder notice; and (iv) any other information relating to such person that would be required to be disclosed on Schedule 13D pursuant to Regulation 13D-G under the Securities Exchange Act, in connection with the acquisition of stock, and pursuant to Regulation 14A under the Securities Exchange Act, in connection with the solicitation of proxies with respect to nominees for election as directors, regardless of whether such person is subject to the provisions of such regulations, including, but not limited to,

Wintrust Shareholder Rights

DelavanSTC Shareholder Rights

understandings between the shareholder and each nominee of the shareholder and any other person or persons (naming such person or persons) pursuant to which the nominations are to be made by the shareholder and (c) the consent of each nominee to be named in any proxy statement and to serve as a director of Wintrust if so elected.

information required to be disclosed by Items 4(b) and 6 of Schedule 14A of Regulation 14A with the SEC; and (b) as to the shareholder giving the notice: (i) the name and address, as they appear on the corporation’s books, of such shareholder and the name and principal business or residential address of any other beneficial shareholders known by such shareholder to support such nominees; and (ii) the class and number of shares of the corporation’s stock which are beneficially owned by such shareholder on the date of such shareholder notice and the number of shares owned beneficially by any other record or beneficial shareholders known by such shareholder to be supporting such nominees on the date of such shareholder notice.

Shareholder Action by Written Consent:

Wintrust’s articles of incorporation and by-laws provide that its shareholders are not permitted to act by written consent. Any action required or permitted to be taken at a meeting of the shareholders must be effected at a duly called annual or special meeting.

Delavan’s

STC’s by-laws provide that any action which may or is required to be taken at a meeting of the shareholders, or any other action which may be taken at a meeting of the shareholders may be taken without a meeting if a written consent in writing, setting forth the action so taken, is signed by: (a) the holders of outstanding shares having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voting, if five days’ prior notice of the proposed action is given in writing to all of the shareholders entitled to vote with respect to the subject matter thereof; or (b) by all of the shareholders who would have been entitled to vote uponwith respect to the subject matter thereof. Prompt notice of the taking of the corporate action ifwithout a meeting were held.by less than unanimous written consent shall be given in writing to those shareholders who have not consented in writing.

Wintrust Shareholder Rights

STC Shareholder Rights

Appointment and Removal of Officers:

Wintrust’s by-laws provide that the officers shall be elected annually by the board of directors at the first meeting of the board of directors held after each annual meeting of the shareholders. Each officer will hold office until his successor is duly elected and qualified or until his prior death, resignation or removal.

 

Any officer may be removed by the board of directors whenever in its judgment the best interests of the corporation will be served thereby.

Delavan’sSTC’s by-laws provide that the officers shall be appointedelected annually by the board of directors.directors at its annual meeting or as soon thereafter as conveniently may be. Each officer will hold office until his or her successor is duly appointedelected and qualified or until his or her prior death, resignation or removal.

 

Any officer may be removed by the board of directors.directors whenever in its judgment the best interests of the corporation will be served thereby.

Required Vote for Certain TransactionsTransactions:

The Wintrust articles of incorporation do not specifically discuss the required vote for transactions involving merger, consolidation, or sale, lease or exchange of all or substantially all of the property or assets of the corporation. But the applicable IBCA provisions state that such a transaction must be approved by two-thirds of the outstanding shares of stock entitled to vote on the matter. The corporation may, however, without approval by a vote of shareholders, merge into itself any corporation of which at least ninety percent (90%) of the outstanding shares of each class is owned by the corporation.

The Delavan articles of incorporation do not specifically discuss transactions involving

Any merger, consolidation, or sale, lease, exchange or exchangeother disposition of all or substantially all of the property or assets of the corporation. Undercorporation and its subsidiaries shall require the WBCL, subjectaffirmative vote of the holders of at least 75% of all outstanding stock entitled to certain exceptions,vote thereon. The approval of only a majority of all the votesoutstanding stock entitled to be cast must approvevote on the matter, however, is sufficient if the transaction has been approved by at least 75% of any planthe board of merger. Underdirectors, the WBCL, Delavan may, however, without approval bytransaction is a vote of shareholders, merge into itself anymerger or consolidation with another corporation of which at least ninety percent (90%)a majority of the outstanding shares of each classall classes of stock is owned by Delavan.the corporation, or the transaction is a merger that does not require shareholder approval under the IBCA.

Wintrust Shareholder Rights

DelavanSTC Shareholder Rights

Amendment to Charter and By laws:

An amendment to the articles of incorporation that relates to certain provisions, including, the prohibition of cumulative voting, shareholder purchase rights, the prohibition of shareholder action by written consent, the number and classification of the board of directors, director liability, indemnification and insurance, number, tenure and qualification of directors or the amendment process, must be approved by the affirmative vote of the holders of eighty-five percent (85%) or more of the voting power of the then-outstanding shares of stock entitled to vote generally in the election of directors, voting together as a single class.

 

Otherwise, as provided by the IBCA, the articles of incorporation may be amended by the affirmative vote of at least two-thirds of the shares entitled to vote on the proposal after the board of directors has passed a resolution by majority vote setting forth the proposed amendment and directing that it be submitted to a vote at a shareholders’ meeting.

 

The power to make, alter, amend or repeal the by-laws of the corporation is vested in the shareholders or the board of directors by a resolution adopted by a majority of the board of directors.

As provided byAn amendment to or repeal of the WBCL, Delavan’s articles of incorporation may be amendedrequires the affirmative vote of 75% of all outstanding stock of the corporation entitled to vote on the matter, unless the amendment or repeal has been adopted by at least 75% of the board of directors, in which case the affirmative vote of at least a majority of the sharesall outstanding stock entitled to vote on the proposal after the board of directors has passed a resolution by majority vote setting forth the proposed amendment and directing that it be submitted to a vote at a shareholders’ meeting.matter is required.

 

TheSTC’s by-laws may also be altered, amended or repealed and new by-lawsbylaws may be adopted by a majority vote of the shareholders ordirectors present at any meeting of the board or by the affirmative vote of directors.the holders of a majority of the shares entitled to vote thereon represented in person or by proxy at any annual or special meeting of the shareholders.

Certain anti-takeover effects of Wintrust’s articles and by-laws and Illinois law and federal law

Certain provisions of Wintrust’s articles of incorporation, by-laws, Illinois law and certain applicable banking regulations may have the effect of impeding the acquisition of control of Wintrust by means of a tender offer, a proxy fight, open-market purchases or otherwise in a transaction not approved by ourWintrust’s board of directors.

These provisions may have the effect of discouraging a future takeover attempt which is not approved by Wintrust’s board of directors but which individual Wintrust shareholders may deem to be in their best interests or in which Wintrust shareholders may receive a substantial premium for their shares over then-current market prices. As a result, shareholders who might desire to participate in such a transaction may not have an opportunity to do so. Such provisions will also render the removal of Wintrust’s current board of directors or management more difficult.

These provisions of Wintrust’s articles of incorporation and by-laws include the following:

·Wintrust’s board of directors may issue additional authorized shares of Wintrust’s capital stock to deter future attempts to gain control of Wintrust, including the authority to determine the terms of any one or more series of preferred stock, such as voting rights, conversion rates and liquidation preferences. As a result of the ability to fix voting rights for a series of preferred stock, Wintrust’s board has the power, to the extent consistent with its fiduciary duty, to issue a series of preferred stock to persons friendly to management in order to attempt to block a merger or other transaction by which a third party seeks control, and thereby assist the incumbent board of directors and management to retain their respective positions;

 

·Wintrust’s articles of incorporation and by-laws do not provide for cumulative voting for any purpose, and Wintrust’s articles of incorporation and by-laws also provide that any action required or permitted to be taken by shareholders may be taken only at an annual or special meeting and prohibit shareholder action by written consent in lieu of a meeting;

 

·                                          Wintrust’s by-laws require at least one-fifth of all the outstanding shares entitled to vote on the matter for which the special meeting is called to call a special meeting of the shareholders, which may limit any potential takeover action to the annual meeting;

·                                          Wintrust’s by-laws establish advance notice procedures with respect to shareholder proposals and shareholder nominations for election of directors;

·Wintrust’s articles of incorporation expressly elect to be governed by the provisions of Section 7.85 of the IBCA. Section 7.85 prohibits a publicly held Illinois corporation from engaging in a business combination with an interested shareholder unless, in addition to any affirmative vote required by law or the articles of incorporation of the company, the proposed business combination:

 

·receives the affirmative vote of the holders of at least 80% of the combined voting power of the then outstanding shares of all classes and series of the corporation entitled to vote generally in the election of directors voting together as a single class (the voting shares)“voting shares”), and the affirmative vote of a majority of the voting shares held by disinterested shareholders;

 

·is approved by at least two-thirds of the disinterested directors; or

 

·provides for consideration offered to shareholdersall holders of common shares that meets certain fair price standards and satisfies certain procedural requirements.

Such fair price standards require that the fair market valueoffered consideration per share of the consideration offered be equal to or greater than the higher of:

 

·the highest per share price paid by the interested shareholder during the two-year period immediately prior to the first public announcement of the proposed business combination or in the transaction by which the interested shareholder became an interested shareholder;shareholder, whichever is higher; and

 

·the fair market value per share of common stock on the first trading date after the first public announcement of the proposed business combination or on the first trading date after the date of the first public announcement that the interested shareholder has becomebecame an interested shareholder.

For purposes of Section 7.85, disinterested director means any member of the board of directors of the corporation who:

 

·is neither the interested shareholder nor an affiliate or associate of the interested shareholder;

·was a member of the board of directors prior to the time that the interested shareholder became an interested shareholder or was a director of the corporation before January 1, 1997, or was recommended to succeed a disinterested director by a majority of the disinterested directors then in office; and

 

·was not nominated for election as a director by the interested shareholder or any affiliate or associate of the interested shareholder.

 

·the amendment of Wintrust’s articles of incorporation must be approved by a majority vote of the board of directors and also by a two-thirds vote of the shares entitled to vote on such amendment, provided, however, that an affirmative vote of at least 85% of the outstanding sharesvoting stock entitled to vote generally in the election of directors is required to amend or repeal certain provisions of the articles of incorporation, including provisions (a) prohibiting cumulative voting rights, (b) relating to shareholder purchase rights, (c) limiting the shareholders’ ability to act by written consent, (d) regarding indemnification of directors and officers by Wintrust and limitation of liability for directors, (e) regarding the minimum number, tenure and qualification of directors and (f) regarding amendment of the foregoing supermajority provisions of Wintrust’s common stock, provided,

articles of incorporation. Wintrust’s by-laws may be amended by the shareholders or the board of directors through a resolution adopted by a majority of the board of directors.

however, that an affirmative vote of at least 85% of the outstanding voting stock entitled to vote is required to amend or repeal certain provisions of the articles of incorporation, including provisions (a) prohibiting cumulative voting rights, (b) relating to certain business combinations, (c) limiting the shareholders’ ability to act by written consent, (d) regarding the minimum number of directors, (e) regarding indemnification of directors and officers by Wintrust and limitation of liability for directors and (f) regarding amendment of the foregoing supermajority provisions of Wintrust’s articles of incorporation. Wintrust’s by-laws may be amended only by its board of directors.

The provisions described above are intended to reduce Wintrust’s vulnerability to takeover attempts and certain other transactions which have not been negotiated with and approved by members of Wintrust’s board of directors.

The ability of a third party to acquire Wintrust is also limited under applicable banking regulations. The Bank Holding Company Act of 1956, or the Bank Holding Company Act, requires any “bank holding company” (as defined in that Act) to obtain the approval of the Federal Reserve prior to acquiring more than 5% of Wintrust’s outstanding common stock. Any person other than a bank holding company is required to obtain prior approval of the Federal Reserve to acquire 10% or more of Wintrust’s outstanding common stock under the Change in Bank Control Act of 1978. Any holder of 25% or more of Wintrust’s outstanding common stock, other than an individual, is subject to regulation as a bank holding company under the Bank Holding Company Act. For purposes of calculating ownership thresholds under these banking regulations, bank regulators would likely at least take the position that the minimum number of shares, and could take the position that the maximum number of shares, of Wintrust common stock that a holder is entitled to receive pursuant to securities convertible into or settled in Wintrust common stock, including pursuant to Wintrust’s warrants to purchase Wintrust common stock held by such holder, must be taken into account in calculating a shareholder’s aggregate holdings of Wintrust common stock.

Certain anti-takeover effects of Delavan’sSTC’s articles and by-laws and WisconsinIllinois law and federal law

Certain provisions of Delavan’sSTC’s articles of incorporation, by-laws, WisconsinIllinois law and certain applicable banking regulations may have the effect of impeding the acquisition of control of DelavanSTC by means of a tender offer, a proxy fight, open-market purchases or otherwise in a transaction not approved by ourSTC’s board of directors.

These provisions may have the effect of discouraging a future takeover attempt which is not approved by Delavan’sSTC’s board of directors but which individual DelavanSTC shareholders may deem to be in their best interests or in which DelavanSTC shareholders may receive a substantial premium for their shares over then-current market prices. As a result, shareholders who might desire to participate in such a transaction may not have an opportunity to do so. Such provisions will also render the removal of Delavan’sSTC’s current board of directors or management more difficult.

These provisions of Delavan’sSTC’s articles of incorporation and by-laws include the following:

 

Delavan’s

·                                          75% of STC’s board of directors may issue additional authorized shares of Delavan’sSTC’s capital stock to deter future attempts to gain control of Delavan.

STC;

 

Delavan’s

·                                          STC’s articles of incorporation and by-laws do not provide for cumulative voting for any purpose, and Delavan’s articles of incorporation and by-laws also provide that any action required or permitted to be taken by shareholders may be taken only at an annual or special meeting.

purpose;

Delavan’s·                                          STC’s by-laws provide that the board of directors consists of three classes of directors, each serving for a three-year term ending in a successive year. This provision may make it more difficult to effect a takeover of DelavanSTC because an acquiring party would generally need two annual meetings of shareholders to elect a majority of the board of directors. As a result, a classified board of directors may discourage proxy contests for the election of directors or purchasers of a substantial block of stock by preventing such a shareholder or purchaser from obtaining control of the board of directors in a relatively short period of time.
time;

Delavan’s

·                                          STC’s by-laws establish advance notice procedures with respect to shareholder proposals and shareholder nominations for election of directors;

·                                          directors may be removed only for cause, which is deemed to exist only if such director has been convicted of a felony or adjudged to be liable for gross negligence or willful misconduct in the performance of duty to the corporation;

·                                          the amendment of STC’s articles of incorporation, provide that no personany merger, consolidation or group acting in concert may directly or indirectly acquire the beneficial ownership of more than 20% of any class of equity security of Delavan. The articles of incorporation also contain the further limitation that shares exceeding the 20% limit will not be entitled to vote or be counted as voting shares. This limitation does not apply to:

any purchase of shares by underwriters retained by Delavan in connection with a public offering of the stock; or

any acquisition approved in advance by a majority of disinterested directors, as long as the approval is obtained at a meeting where a quorum of disinterested directors is present.

Delavan’s common stock is subject to the restrictions on transfer contained in the by-laws known as a “right of first refusal.” If a shareholder wishes to transfer (which includes give, sell, assign, pledge) any of his or her shares of Delavan common stock then Delavan and other individual members of the Board of Directors have a right of first refusal with respect to those shares. The right of first refusal generally works as follows:

The right generally does not apply to a transfer between a shareholder and his or her spouse, children, parents, or siblings, or a trust created for the benefit of such persons as long as the person receiving the shares is subject to the restrictions on transfer.

A pledge of shares is permitted as security for a loan only if (i) the title to the shares is not transferred; (ii) voting rights to the shares are not transferred; (iii) Delavan has given its prior written consent; and (iv) there is no other sale or transfer of the shares except in accordance with the by-laws.

If a shareholder wishes to transfer any shares of stock to a person or entity other than those listed above, Delavan will have the first right, and its current directors the second right, to purchase all or some of the shares to be transferred. Delavan is not obligated to make any purchases of Delavan common stock, but may do so at the discretion of its board of directors. The shareholder must give notice and follow the procedures described in the by-laws.

If the shares are to be transferred by a proposed sale to a third party, the purchase price under the right of first refusal will be the third party offer price as disclosed in the written notice to Delavan based on a bona fide written offer to purchase, signed by the third party buyer.

If the shares are to be transferred other than by a sale, the purchase price will be the “redemption value” of the shares. “Redemption value” is defined in the by-laws as the excess of the amount, if any, of Delavan’s total assets over its total liabilities, divided by the number of issued and outstanding shares.

Any shares not purchased by Delavan or its directors may be transferred to the transferee identified in the written notice to Delavan, at the same consideration and on the same terms and conditions set forth in the notice.

Delavan’s articles of incorporation expressly elect to be governed by the provisions of §§180.1130-.1134 and 180.1150 of the WCBL, whether or not Delavan would otherwise be subject to those statutory provisions:

§§180.1130 through 180.1133 provide that “business combinations” involving a “significant shareholder” are subject to a two-thirds supermajority vote of shareholders, in addition to any approval otherwise required.

A “business combination” includes a merger or share exchange, or a sale, lease, exchange mortgage, pledge, transfer or other disposition of assets equal to at least 5%all or substantially all of the market value of the stock or assets of the corporation or 10%and its subsidiaries must be approved by at least 75% of its earning power, or

the issuance of stock or rights to purchase stock with a market value equal to at least 5% of theall outstanding stock, the adoption of a plan of liquidation or dissolution and certain other transactions involving an “interested stockholder” (i.e. a person who beneficially owns 10% of the voting power of the outstanding voting stock of the corporation or who is an affiliate or associate of the corporation and beneficially owned 10% of the voting power of the then outstanding voting stock within the last three years).

A “significant shareholder” is a person who beneficially owns, directly or indirectly, 10% or more of the voting stock of the corporation or an affiliateentitled to vote on such matter, unless the matter has been approved by at least 75% of the corporationboard of directors, in which beneficially owned, directly or indirectly, 10% or morecase the approval of the votingat least a majority of all outstanding stock of the corporation within the last two years.
entitled to vote thereon is required; and

 

§180.1131 and §180.1132 require business combinations between Delavan and a significant shareholder to be approved

·                                          STC’s by-laws may be amended by 80% of the voting power of Delavan’s stock and at least two-thirds of the voting power of Delavan’s stock not beneficially held by the significant shareholder who is party to the relevant transaction or any of its affiliates or associates, in each case voting together as a single group,unless the following fair price standards have been met:

the aggregate value of the per share consideration is equal to the higher of:

the highest price paid for any common stock of Delavan by the significant shareholder in the transaction in which it became a significant shareholder or within two years before the date of the Business combination,

the market value of Delavan’s shares on the date of commencement of any tender offer by the significant shareholder, the date on which the person became a significant shareholder or the date of the first public announcement of the proposed Business combination, whichever is highest, or

the highest liquidation or dissolution distribution to which holders of the shares would be entitled, and

either cash, or the form of consideration used by the significant shareholder to acquire the largest number of shares, is offered.

§180.1150 provides that, in the election of directors, the voting power of shares held by any person (or persons acting as a group) in excess of 20% of the voting power is limited to 10% of the full voting power of those shares. This voting restriction does not apply to shares acquired directly from Delavan or in certain specified transactions or shares for which full voting power has been restored pursuant to a vote of shareholders.

§180.1134 provides that, in addition to the vote otherwise required by law or Delavan’s articles of incorporation, the approval of the holders of a majority of the shares represented at an annual or special meeting entitled to vote is required before Delavan can take certain actions while a takeover offer is being madeon the amendment or after a takeover offer has been publicly announced and before it is concluded. Under §180.1134, shareholder approval is required for Delavan to:

acquire more than 5% of the outstanding voting shares at a price above the market price from any individual who or organization which owns more than 3% of the outstanding voting shares and has held such shares for less than two years, unless a similar offer is made to acquire all voting shares (which have the effect of deterring a shareholder from acquiring shares of common stock of Delavan with the goal of seeking to have Delavan repurchase such shares at a premium over the market price), or

sell or option assets of the corporation which amount to at least 10% of the market value of the corporation, unless the corporation has at least three independent directors (directors who are not officers or employees) andby a majority of directors present at any meeting of the independent directors vote not to have this provision apply to the corporation.
board of directors.

The provisions described above are intended to reduce Delavan’sSTC’s vulnerability to takeover attempts and certain other transactions which have not been negotiated with and approved by members of Delavan’sSTC’s board of directors.

As with Wintrust, the ability of a third party to acquire DelavanSTC is also limited under the same banking regulations described in the last paragraph of “—No solicitationCertain anti-takeover effects of or discussions relating to an acquisition proposal”Wintrust’s articles and by-laws and Illinois law and federal law” above.

DESCRIPTION OF WINTRUST CAPITAL STOCK

The following description of the capital stock of Wintrust does not purport to be complete and is qualified, in all respects, to applicable Illinois law and provisions of Wintrust’s amended and restated articles of incorporation, as amended, and Wintrust’s amended and restated by-laws. Wintrust’s amended and restated articles of incorporation and Wintrust’s amended and restated by-laws are incorporated by reference and will be sent to shareholders of Wintrust and DelavanSTC upon request. See “Where You Can Find More Information” on page 78.87.

Authorized capital stock

Under its amended and restated articles of incorporation, Wintrust has the authority to issue 100 million shares of common stock, without par value, and 20 million shares of preferred stock, without par value. As of September 30, 2014March 31, 2019 there were issued and outstanding 46,691,04756,638,968 shares of Wintrust common stock noand 5,000,000 shares of series A preferred and 126,467 shares of series CWintrust Series D preferred.

Wintrust common stock

Wintrust Common Stock Outstanding. The outstanding shares of Wintrust common stock are, and the shares of Wintrust common stock issuable pursuant to the merger or upon the conversion of the series C preferred will be, duly authorized, validly issued, fully paid and non-assessable. The shares of Wintrust common stock issuable upon the conversion of any series A preferred that we may issue will be, duly authorized, validly issued, fully paid and non-assessable. The rights, preferences and privileges of holders of Wintrust common stock are subject to, and may be adversely affected by, the rights of the holders of shares of any series of Wintrust preferred stock, including the series A preferred, series CWintrust Series D preferred and any series of preferred stock that Wintrust may designate and issue in the future.

Shares of Wintrust common stock may be certificated or uncertificated, as provided by Wintrust’s by-laws and the IBCA.

Voting Rights. Each holder of Wintrust common stock is entitled to one vote for each share held on all matterseach matter submitted to a vote at a meeting of shareholders of Wintrust and does not have cumulative voting rights. Accordingly, holders of a majority of the shares of Wintrust common stock entitled to vote in any election of directors of Wintrust may elect all of the directors standing for election.

Dividend Rights. The holders of Wintrust common stock are entitled to receive dividends, if and when declared payable by Wintrust’s board of directors from any funds legally available for the payment of dividends, subject to any preferential dividend rights of Wintrust’s outstanding preferred stock, including the series A preferred and series CWintrust Series D preferred. Upon the liquidation, dissolution or winding up of Wintrust, the holders of Wintrust common stock are entitled to share pro rata in Wintrust’s net assets available after the payment of all debts and other liabilities and subject to the prior rights of any outstanding preferred stock of Wintrust, including the series A preferred and series CWintrust Series D preferred.

Preemptive Rights. Under its amended and restated articles of incorporation, the holders of Wintrust common stock have no preemptive, subscription, redemption or conversion rights.

Wintrust series ASeries D preferred stock

Wintrust Series AD Preferred Stock Outstanding.  As of September 30, 2014, nothe date of this proxy statement/prospectus, Wintrust had 5,000,000 shares of Wintrust Series AD preferred were outstanding. If any shares of Series A preferred are issued in the future, the following terms would apply to such shares:

Dividends. Non-cumulative cash dividends on any outstanding sharesthe liquidation preference of series A$25 per share of the Wintrust Series D preferred are payable quarterly in arrears if, when, as and asif declared by Wintrust’s board of directors atat: (i) a rate of 8.00%6.5% per year from the date of the issuance to but excluding July 15, 2025 and (ii) a floating rate equal to the Three-Month LIBOR (as defined in the Series D Certificate of Designations) plus a spread of 4.06% per year from and including July 15, 2025. The dividend rate of such floating rate dividends will be reset quarterly. In the event that Wintrust has not declared a dividend on the liquidation preference of $1,000 per share. With certain limited exceptions, if Wintrust does not pay full cash dividends on the series ASeries D preferred for the most recently completed dividend period, the ability of Wintrust may notto pay or declare and set aside for payment dividends, on, or repurchase,to redeem, purchase or make a liquidation payment with respect to,acquire Wintrust common stock or any other stock ranking equally with or junior to or on parity with the series AWintrust Series D Preferred Stock is subject to restrictions.

Redemption. The Wintrust Series D preferred including the series C preferred. The series A preferredhas no stated maturity date, is not redeemable bysubject to any mandatory redemption, sinking fund or other similar provisions and will remain outstanding unless redeemed at Wintrust’s option. Wintrust may redeem the holders thereofWintrust Series D preferred, (i) in whole or by Wintrust.

Conversion. Holders of the series A preferred may convert their shares into common stockin part, from time to time, on any dividend payment date on or after July 15, 2025, or (ii) in whole but not in part, at any time. Wintrust may convert all of the series A preferred into common stock upon the consummation of certain Fundamental Transactionstime within 90 days following a “regulatory capital treatment event” (as defined in the Series AD Certificate of Designations), provided that Wintrust hasin each case at a redemption price equal to $25.00 per share, plus any declared and paid in fullunpaid dividends, onwithout accumulation of any undeclared dividends to, but excluding, the series Aredemption date.

Conversion. Holders of Wintrust Series D preferred do not have any rights to convert shares of Wintrust Series D preferred into, or exchange shares of Wintrust Series D preferred for, the four most recently completed quarterly dividend periods. Wintrust may convert any or all of the series A preferred into common stock if, for 20 trading days during any period of 30 consecutive trading days, the closing price of Wintrust common stock exceeds $35.59 and Wintrust has declared and paid in full dividends on the series A preferred for the four most recently completed quarterly dividend periods. The conversion price of the series A preferred is subject to customary anti-dilution adjustments.

Reorganization Events and Fundamental Transactions. If Wintrust consummates a Reorganization Event (as defined in the Series A Certificate of Designations), each share of the series A preferred will, without the consent of the holders, become convertible into the kind of securities, cash and other property receivable in such Reorganization Event by a holder of the shares of common stock.any other class of capital stock of Wintrust.

Voting Rights. Holders of the series AWintrust Series D preferred generally do not have any voting rights, except as required by law.Illinois law or as may be required by Nasdaq rules. However, Wintrust may not amend its articles of incorporation or by-laws in a manner adverseso as to materially and adversely affect the rights of the series AWintrust Series D preferred, issue capital stock ranking senior to the series AWintrust Series D preferred or take certain other actions without the approval of the holders of at least two-thirds (2/3) of all outstanding shares of the series A preferred.Wintrust Series D preferred and any voting preferred stock then outstanding and entitled to vote thereon, voting together as a single class in proportion to their respective liquidation preferences. In addition, holders of the series AWintrust Series D preferred, voting together as a single class in proportion to their respective liquidation preferences with the holders of any and all other parity securities having similarseries of voting rights, maypreferred stock then outstanding, will be entitled to elect two additional members to Wintrust’s board of directors if Wintrust

has not paid dividends on the series A preferred for four or more quarterly dividend periods, whether or not consecutive.

Wintrust series C preferred stock

Dividends. Non-cumulative dividends on the series C preferred are payable quarterly in arrears if, when and as declared by Wintrust’s board of directors, at a rate of 5.00% per year on the liquidation preference of $1,000 per share. With certain limited exceptions, if Wintrust does not pay full cash dividends on the series C preferred for the most recently completed dividend period, Wintrust may not pay dividends on, or repurchase, redeem or make a liquidation payment with respect to, Wintrust common stock or other stock ranking equally with or junior to the series C preferred. The series C preferred is not redeemable by the holders thereof or by Wintrust.

Conversion. Holders of the series C preferred may convert their shares into Wintrust common stock at any time. On or after April 15, 2017, if the closing price of the Wintrust common stock exceeds 130% of the conversion price then in effect for 20 trading days during any 30 consecutive trading day period, including the last trading day of such period, ending on the trading day preceding the date Wintrust gives notice of mandatory conversion, Wintrust may at its option cause some or all of the series C preferred to be automatically converted into common stock at the then prevailing conversion rate. In addition, in connection with a Make-Whole Acquisition (as defined in the Series C Certificate of Designations), Wintrust will, under certain circumstances, be required to pay an adjustment in the form of an increase in the conversion rate upon any conversions of the series C preferred that occur during the period beginning on the effective date of the Make-Whole Acquisition and ending on the date that is 30 days after the effective date of such Make-Whole Acquisition. The adjustment in the conversion rate in the event of a Make-Whole Acquisition will be payable in shares of Wintrust common stock or the consideration into which the Wintrust common stock has been converted or exchanged in connection with the Make-Whole

Acquisition. The amount of the adjustment in the conversion rate in the event of a Make-Whole Acquisition, if any, will be based on the stock price and the effective date of the Make-Whole Acquisition. The conversion price of the series C preferred is subject to customary anti-dilution adjustments.

Reorganization Events and Fundamental Transactions. If Wintrust consummates a Reorganization Event (as defined in the Series C Certificate of Designations), each share of the series C preferred will, without the consent of the holders, become convertible into the kind of securities, cash and other property receivable in such Reorganization Event by a holder of the shares of common stock.

Voting Rights. Holders of the series C preferred generally do not have any voting rights, except as required by law. However, Wintrust may not amend its articles of incorporation in a manner adverse to the rights of the series C preferred, issue capital stock ranking senior to the series C preferred or take certain other actions without the approval of the holders of the series C preferred. In addition, holders of the series C preferred, together with the holders of other parity securities having similar voting rights, may elect two directors if Wintrust has not paid dividends on the series CD preferred for six or more quarterly dividend periods, whether or not consecutive.

Preferred stock

Blank Check Preferred Stock. Under its amended and restated articles of incorporation, the Wintrust board of directors has the authority to issue preferred stock in one or more classes orseries, to fix the number of shares in each such series and to fix for each class or series the votingdesignations and powers, and the distinctive designations, preferences and relative, participation,participating, optional or other special rights, and suchthe qualifications, limitations orand restrictions, as may be stated and expressed in the resolution or resolutions adopted by the Wintrust board of directors providing for the issuance of such class or series as may be permitted by the IBCA, including dividend rates, conversion rights, terms of redemption and liquidation preferences, and the number of shares constituting each such class or series, without any further vote or action by Wintrust’s shareholders.

Exchange agent and registrar

American Stock Transfer & Trust Company, LLC is the exchange agent for the merger and the transfer agent for the Wintrust common stock.

LEGAL MATTERS

Certain matters pertaining to the validity of the authorization and issuance of the Wintrust common stock to be issued in the merger have been passed upon by Lisa J. Pattis,Kathleen M. Boege, Wintrust’s Executive Vice President, General Counsel and Corporate Secretary. Ms. PattisBoege beneficially owns or has rights to acquire an aggregate of less than 1.0% of Wintrust’s common stock.

Certain matters pertaining to the federal income tax consequences of the merger have been passed upon by WIPFLI, LLP, 10000 Innovation Drive,Barack Ferrazzano, 200 West Madison Street, Suite 250, Milwaukee, Wisconsin 53226.3900, Chicago, Illinois 60606.

EXPERTSEXPERTS

The consolidated financial statements of Wintrust Financial Corporation incorporated by referenceappearing in Wintrust Financial Corporation’s Annual Report on Form 10-K(Form 10-K) for the year ended December 31, 20132018 and the effectiveness of Wintrust Financial Corporation’s internal control over financial reporting as of December 31, 20132018 have been audited by Ernst & Young LLP, independent registered public accounting firm, as set forth in itstheir reports thereon, incorporated by referenceincluded therein, and incorporated herein by reference. Such consolidated financial statements and Wintrust Financial Corporation’sCorporation management’s assessment of the effectiveness of internal control over financial reporting as of December 31, 20132018 are incorporated herein by reference in reliance upon such reports given on the authority of such firm as experts in accounting and auditing.

SHAREHOLDER PROPOSALS

The next annual meeting of Wintrust’s shareholders will be held in 2015.2020. To be considered for inclusion in Wintrust’s proxy materials for that annual meeting, any shareholder proposal must have been received in writing at Wintrust’s principal office at 9700 W. Higgins Road, Suite 800, Rosemont, Illinois 60018, by December 5, 2014.7, 2019. All shareholder proposals submitted for inclusion in Wintrust’s proxy materials will be subject to the requirements of the proxy rules adopted under the Securities Exchange Act.

Furthermore, in order for any shareholder to properly propose any business for consideration at Wintrust’s 20152020 annual meeting, including the nomination of any person for election as a director, on any matter raised other than pursuant to Rule 14a-8 of the proxy rules adopted under the Securities Exchange Act, written notice of the shareholder’s intention to make such proposal must be furnished to Wintrust in accordance with its by-laws. Under the existing provisions of Wintrust’s by-laws, the deadline for such notice is February 21, 201523, 2020 (but not before January 22, 2015)24, 2020).

WHERE YOU CAN FIND MORE INFORMATION

Wintrust files annual, quarterly and current reports, proxy statements and other information with the SEC. These filings are available to the public over the Internet at the SEC’s website at www.sec.gov. You may also read and copy any document Wintrust files with the SEC at the SEC’s public reference room located at 100 F Street, N.E., Washington D.C. 20549. Copies of these documents also can be obtained at prescribed rates by writing to the Public Reference Section of the SEC, at 100 F Street, N.E., Washington D.C. 20549 or by calling 1 800 SEC-0330 for additional information on the operation of the public reference facilities.  Wintrust’s SEC filings are also available on its Web site at http://www.wintrust.com.

Wintrust filed with the SEC a registration statement on Form S-4 under the Securities Act to register the shares of Wintrust common stock to be issued to Delavan’sSTC’s shareholders upon completion of the merger. This proxy statement/prospectus is a part of that registration statement and constitutes a prospectus of Wintrust in addition to being a proxy statement of DelavanSTC for its special meeting. As permitted by the SEC rules, this proxy statement/prospectus does not contain all of the information that you can find in the registration statement or in the exhibits to the registration statement. The additional information may be inspected and copied as set forth above.

For more information about Delavan, including copies of Delavan’s historical financial statements, you should contact Michael J. Murphy, Delavan’s President and Chief Executive Officer, or Jon Martin, Delavan’s Chief Financial Officer, at (866) 848-2265.

INCORPORATION OF CERTAIN INFORMATION BY REFERENCE

The SEC allows Wintrust to incorporate by reference information into this proxy statement/prospectus. This means that Wintrust can disclose important information to you by referring you to another document filed separately with the SEC. The information incorporated by reference is an important part of this proxy statement/prospectus, except for any information superseded by information in this proxy statement/prospectus of

any subsequent filing incorporated by reference in this proxy statement/prospectus. This proxy statement/prospectus incorporates by reference the documents set forth below that Wintrust has filed previously with the SEC and any additional filings Wintrust makes with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act after the date of this proxy statement/prospectus and before the special meeting; provided, however, that this proxy statement/prospectus does not incorporate by reference any documents, portions of documents or other information that is deemed to have been “furnished” and not “filed” with the SEC:

 

Wintrust’s Annual Report on Form 10-K for the year ended December 31, 2013;

·

Wintrust’s Annual Report on Form 10-K for the year ended December 31, 2018;

·

the sections of Wintrust’s Definitive Proxy Statement for the 2019 Annual Meeting of Shareholders filed with the SEC on April 5, 2019 that are incorporated by reference in Wintrust’s Annual Report on Form 10-K for the year ended December 31, 2018;

·

Wintrust’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2019;

·

Wintrust’s Current Reports on Form 8-K, filed with the SEC on January 23, February 22, April 16, May 24, May 30 and June 6, 2019; and

·

the description of Wintrust common stock, which is registered under Section 12 of the Securities Exchange Act, in Wintrust’s Form 8-A filed with the SEC on January 3, 1997, including any subsequently filed amendments and reports updating such description.

 

the sections of Wintrust’s Definitive Proxy Statement for the 2014 Annual Meeting of Shareholders filed with the SEC on April 4, 2014 that are incorporated by reference in Wintrust’s Annual Report on Form 10-K for the year ended December 31, 2013;

Wintrust’s Quarterly Reports on Form 10-Q for the quarterly periods ended March 31, 2014, June 30, 2014 and September 30, 2014;

Wintrust’s Current Reports on Form 8-K, filed with the SEC on January 23, May 23, June 13, July 29, October 14, and October 27, 2014; and

the description of Wintrust common stock, which is registered under Section 12 of the Securities Exchange Act, in Wintrust’s Form 8-A filed with the SEC on January 3, 1997, including any subsequently filed amendments and reports updating such description.

You may request, either orally or in writing, and Wintrust will provide, a copy of these filings without charge by contacting Lisa J. Pattis,Kathleen M. Boege, Wintrust’s Corporate Secretary, at 9700 W. Higgins Road, Suite 800, Rosemont, Illinois 60018, (847) 939-9000.If you would like to request documents, please do so by, 2015,2019, to receive them before the special meeting.

All information concerning Wintrust and its subsidiaries has been furnished by Wintrust, and all information concerning DelavanSTC and its subsidiaries has been furnished by Delavan.STC.

You should rely only on the information contained or incorporated by reference in this proxy statement/prospectus to vote on the proposals to DelavanSTC shareholders in connection with the merger. We have not authorized anyone to provide you with information that is different from what is contained in this proxy statement/prospectus. This proxy statement/prospectus is dated, 2014.2019. You should not assume that the information contained in this proxy statement/prospectus is accurate as of any date other than such date, and neither the mailing of this proxy statement/prospectus to shareholders nor the issuance of shares of Wintrust common stock as contemplated by the merger agreement will create any implication to the contrary.

Annex A-1

Annex A

AGREEMENT AND PLAN OF MERGER

BY AND AMONG

WINTRUST FINANCIAL CORPORATION,

WINTRUST

WTFC STCBC MERGER CO.SUB LLC

AND

DELAVANAND

STC BANCSHARES INC.CORP.

Dated as of October 13, 2014

June 5, 2019


Table of Contents

4.6

Business Relations and Publicity

A-28

A-1-38

4.7

Covenants Regarding Real Property

A-29

A-1-38

4.8

No Solicitation by Company

No Conduct Inconsistent with this AgreementA-1-39

A-30

4.9

Loan Charge-Off; Pre-Closing Loan Review

A-31

A-1-43

4.10

Director and Officer Insurance Coverage

A-31

A-1-43

4.11

Interim Financial Statements

A-32

A-1-44

4.12

Dissent Process

Dissent ProcessA-1-44

A-32

4.13

Section 368(a) Reorganization

A-32

A-1-44

4.14

Treatment of Options

A-32

A-1-44

4.15

Untrue Representations and Warranties

A-32

A-1-44

4.16

Shareholder Litigation

Company IndebtednessA-1-45

A-32

4.17

Notice of Certain Events

A-1-45

4.18

Reasonable and Diligent Efforts

A-32

A-1-45

ARTICLE V EMPLOYEE BENEFIT MATTERS

A-33

A-1-45

5.1

Benefit Plans

A-33

5.25.1

Benefit Plans

A-1-45

5.2

No Rights or Remedies

A-33

A-1-46

ARTICLE VI CONDITIONS PRECEDENT TO OBLIGATIONS OF WINTRUST AND MERGER CO.

A-33

A-1-46

6.1

6.1

Representations and Warranties; Performance of Agreements

A-33

A-1-46

6.2

Certificates

Closing CertificateA-1-46

A-33

6.3

Regulatory and Other Approvals

A-33

A-1-46

6.4

Approval of Merger andMerger; Delivery of Articles of MergerIL SOS Filings

A-33

A-1-47

6.5

No Litigation

No LitigationA-1-47

A-34

6.6

Opinion of Counsel

Environmental ReviewA-1-47

A-34

6.7

Employment Agreements

Opinion of CounselA-1-47

A-35

6.8

No Adverse Changes

Employment AgreementsA-1-47

A-35

6.9

No Adverse Changes

A-35

6.10

Minimum Net Worth and Loan Loss Reserve Requirements

A-35

A-1-47

6.116.10

Consents

Title Commitments, SurveysA-1-48

A-35

6.126.11

Delivery of Articles of Merger

A-35

6.13

Consents

A-36

6.14

Effectiveness of the Registration Statement

A-36

A-1-48

6.156.12

NASDAQ Listing

Other DocumentsA-1-48

A-36

A-ii


6.13

Other Documents

A-1-48

A-1-iii


Table of Contents

INDEX OF DEFINED TERMS

Term

Page

AAA

A-1-53

Adjusted Net Worth

A-1-48

Aggregate Share Amount

A-1-2

Agreement

A-1-1

Articles of Merger

A-36

A-1-1

7.5Assignment Agreement

NoA-1-50

Audited Balance Sheet

A-1-12

Audited Balance Sheet Date

A-1-12

Audited Financial Statements

A-1-12

Bank

A-1-4

Bank Board

A-1-12

Bank Owned Real Property

A-1-13

Bank Subsidiary

A-1-9

Basket Amount

A-1-51

Benefit Plans

A-1-25

BHCA

A-1-9

BSA/AML Law

A-1-17

business day

A-1-57

CERCLA

A-1-23

Claims

A-1-51

Closing

A-1-8

Closing Balance Sheet

A-1-48

Closing Date

A-1-8

Code

A-1-1

Commission

A-1-30

Company

A-1-1

Company Board

A-1-11

Company Common Stock

A-1-3

Company Common Stock Outstanding

A-1-3

Company Indemnified Parties

A-1-51

Company Option Plans

A-1-6

Company Recommendation

A-1-41

Company Recommendation Change

A-1-41

Company Shareholder Approval

A-1-47

Company Stock Certificate

A-1-3

Company Subsidiaries

A-1-9

Company Takeover Proposal

A-1-42

Confidentiality Agreement

A-1-36

Conversion Fund

A-1-4

Converted Option

A-1-6

CRA

A-1-23

Customer Litigation

A-36

A-1-7

7.6Disposal

Opinions of CounselA-1-23

A-37

7.7Dissenting Shares

No Adverse ChangesA-1-6

A-37

7.8Effective Time

Effectiveness of the Registration StatementA-1-1

A-37

7.9Employees

NASDAQ ListingA-1-24

A-37

7.10

Other Documents

A-37

ARTICLE VIII SURVIVAL; INDEMNIFICATION

A-37

8.1

Survival of Representations

A-37

8.2

Indemnification

A-37

8.3

Indemnification Procedure

A-38

8.4

Appointment of Shareholders’ Agent

A-39

8.5

Adjustment to Merger Consideration

A-39

8.6

Sole and Exclusive Remedy

A-39

8.7

Arbitration

A-39

ARTICLE IX GENERAL

A-40

9.1

Termination Fees; Expenses

A-40

9.2

Termination

A-41

9.3

Confidential Information

A-41

9.4

Non-Assignment

A-42

9.5

Notices

A-42

9.6

Counterparts

A-42

9.7

Knowledge

A-43

9.8

Interpretation

A-43

9.9

Entire Agreement

A-43

9.10

Governing Law

A-43

9.11

Severability

A-43

 

A-iiiA-1-v



EXHIBITSTable of Contents

 

Encumbrances

A-1-13

Exhibit A

Environmental Laws

Voting Agreement

A-1-23

ERISA Affiliate

A-1-25

ERISA Plans

A-1-25

Escrow Account

A-1-2

Escrow Agent

A-1-6

Escrow Agreement

A-1-6

Escrow Amount

A-1-2

Exchange Agent

A-1-4

Fair Lending Law

A-1-18

FDIC

A-1-23

Federal Reserve

A-1-32

Federal Reserve Application

A-1-32

Financial Statements

A-1-11

GAAP

A-1-9

Governmental Authority

A-1-11

Hazardous Materials

A-1-23

IBCA

A-1-6

IDFPR

A-1-23

IL SOS

A-1-1

Illinois LLC Act

A-1-1

Indemnification Agreement

A-1-15

Intellectual Property

A-1-27

Interim Balance Sheet

A-1-12

Interim Financial Statements

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Investment Securities

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IRS

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IT Assets

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knowledge

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law

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Licenses

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Loans

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Material Adverse Effect

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Material Contracts

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Merger

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Merger Co.

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Merger Consideration

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Minimum Adjusted Net Worth

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New Encumbrance

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Option Exchange Ratio

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Ordinary Course of Business

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OREO

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Outstanding Company Option

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Parties

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Party

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Per Share Cash Consideration

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Per Share Escrowed Consideration

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Per Share Merger Consideration

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Per Share Stock Consideration

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Permitted Encumbrances

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Person

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Prevailing Party

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Prior Company Bidders

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Proforma Policies

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Proxy Statement

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RCRA

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Real Property

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Regulatory Reports

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Release

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Representative

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Reserve Account

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Reserve Agreement

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Reserve Amount

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Shareholders’ Meeting

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Shareholders’ Representative

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Superior Company Proposal

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Surveys

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Surviving Company

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Tax

A-1-19

Tax Returns

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Taxes

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Title Commitments

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Title Insurer

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Title Policies

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UDAAP Law

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Volcker Rule

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VWAP

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Wintrust

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Wintrust Common Stock

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Wintrust Common Stock Price

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Wintrust Indemnified Parties

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Wintrust Regulatory Reports

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Wintrust SEC Documents

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EXHIBITS

Exhibit A

Voting Agreement

Exhibit B

Form of Option ConversionEscrow Agreement

Exhibit C

Form of Reserve Agreement

Exhibits D-1 and D-2

Proforma Policies

Exhibits E-1 and E-2

Surveys

Exhibit F

Form of Opinion of Company Counsel

Exhibit D

Exhibits G-1 and G-2

Form

Forms of Employment AgreementAgreements

Exhibit EH

Form of Opinion of Wintrust Counsel

Exhibit FI

Form of Date Down EndorsementsAssignment Agreement

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AGREEMENT AND PLAN OF MERGER

This AGREEMENT AND PLAN OF MERGER (this “Agreement”), is entered into as of the 13th5th day of October, 2014,June, 2019, by and among WINTRUST FINANCIAL CORPORATION, an Illinois corporation (“Wintrust”), WINTRUST MERGER CO., a Wisconsin corporationWTFC STCBC Merger Sub LLC, an Illinois limited liability company and wholly owned subsidiary of Wintrust (“Merger Co.”), and DELAVANSTC BANCSHARES INC.CORP., a Wisconsinan Illinois corporation (the “Company”).  Wintrust, Merger Co. and the Company are each referred to in this Agreement as a “Party” and collectively in this Agreement as the “Parties.”

RECITALS

RECITALS

WHEREAS, the board of directors of each of Wintrust, Merger Co. and the Company have approved and declared it advisable and in the best interests of the Parties and their respective shareholders to effect a reorganization, whereby the Company will merge with and into Merger Co., in the manner and on the terms and subject to the conditions set forth in ARTICLE I (the “Merger”), as a result of which the Surviving CorporationCompany (as defined below) will become a wholly owned subsidiary of Wintrust;

WHEREAS, for federal income tax purposes the Parties desire and intend that the Merger qualify as a reorganization in accordance with Section 368(a) of the Internal Revenue Code of 1986, as amended (the “Code”), and that this Agreement constitute a “plan of reorganization” for purposeswithin the meaning of Treasury Regulation Section 368 of the Code;1.368-2(g); and

WHEREAS, certain shareholders of the Company have entered into a Voting Agreement, a copy of which is attached hereto asExhibit A, by which they agree to vote in favor of this Agreement.

NOW THEREFORE, in consideration of the premises and the mutual promises herein made, and in consideration of the representations, warranties and covenants herein contained, the Parties agree as follows:

ARTICLE I

THE MERGER

1.1The Merger.Merger.  Upon the terms and subject to the conditions of this Agreement, on the Closing Date (as defined in Section 1.10)1.12) and in accordance with the Wisconsin Business Corporation LawIllinois Limited Liability Company Act (the WBCL“Illinois LLC Act”), the Company shall be merged with and into Merger Co., whereupon the separate corporate existence of the Company shall cease, and Merger Co. shall continue as the corporation surviving the Merger (the “Surviving CorporationCompany”).

1.2Effective TimeTime.. As of

(a)                                 On the Closing Date, the Parties will cause articles of merger (the “Articles of Merger”) to be executed and filed with the Secretary of State of Wisconsin Departmentthe State of Financial Institutions Division of Corporate & Consumer Services (“Illinois (the “WDFIIL SOS”), as provided in the WBCL.Illinois LLC Act.  The Merger shall become effective on the date and time (referred to as the “Effective Time”) at which the Articles of Merger are duly filed with WDFI,have been accepted by the IL SOS, or at such other later date and time as is agreed among the Parties and specified in the Articles of Merger.


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1.3Effects of the MergerMerger..  At and as of the Effective Time:

(a)                                 as a result of the Merger, the articles of incorporationorganization and the by-lawsoperating agreement of Merger Co. shall be the articles of incorporationorganization and the by-lawsoperating agreement of the Surviving Corporation;Company;

(b)                                 the persons serving as directorsmanagers of Merger Co. shall comprise the board of directorsmanagers of the Surviving Corporation,Company, and the officers of the CompanyMerger Co. shall be the officers of the Surviving Corporation,Company, in each case until their successors have been duly elected or appointed and qualified or until their earlier death, resignation or removal; and

(c)                                  the Merger shall have the effects set forth in Section 180.110637-30 of WBCL.

the Illinois LLC Act.

1.4Merger Consideration; Conversion of SharesShares..

(a)Merger Consideration.  The aggregate consideration to be paid in the Merger (the “Merger Consideration”) shall be $38,000,000,equal to the product of $100 and the number of shares of Company Common Stock Outstanding, which amount shall be subject to adjustment pursuant to Section 6.10(b)6.9(b).  The Merger Consideration is intended to be paid fifty percent (50%) in cash and fifty percent (50%) in shares of common stock, no par value per share, of Wintrust (“Wintrust Common Stock (as defined below)”).  Of the cash portion of the Merger Consideration, (i) an amount in cash equal to $2,500,000 (the “Escrow Amount”) will be deposited by Wintrust at Closing into a special purpose non-interest bearing escrow account (the “Escrow Account”) as described in Section 1.10(a) and (ii) an amount in cash equal to $400,000 (the “Reserve Amount”) will be deposited by Wintrust at Closing into a special purpose non-interest bearing escrow account (the “Reserve Account”) as described in Section 1.10(b).

(b)                                 “Per Share Merger Consideration” shall mean the following:

(i)                                     an amount of cash equal to (A) the product obtained by multiplying (I) the Merger Consideration multiplied by (II) 0.5, minus (B) the Escrow Amount, minus (C) the Reserve Amount, with the resultant amount divided by (B)(D) the number of shares of Company Common Stock Outstanding (as defined below) issued and outstanding immediately prior to the Effective Time,, rounded to the nearest $0.01 (the “Per Share Cash Consideration”); plus

(ii)                                  the right to receive an amount in cash, to be paid: (A) from the Escrow Account in the manner described in Section 1.10(a) and as further set forth in the Escrow Agreement, equal to the quotient obtained by dividing (1) that portion of the Escrow Amount to be disbursed to the Exchange Agent pursuant to the terms of the Escrow Agreement by (2) the total number of shares of Company Common Stock Outstanding, rounded to the nearest $0.01; and (B) from the Reserve Account in the manner described in Section 1.10(b) and as further set forth in the Reserve Agreement, equal to the quotient obtained by dividing (1) the amount of cash contained in the Reserve Account to be disbursed to the Exchange Agent pursuant to the terms of the Reserve Agreement by (2) the total number of shares of Company Common Stock Outstanding, rounded to the nearest $0.01 (collectively, the “Per Share Escrowed Consideration”);

(iii)                               a number of shares of Wintrust Common Stock equal to (A) the quotient obtained by dividing (I) the Aggregate Share Amount (as defined below) by (II) the number of shares of Company Common Stock (as defined below) issued and outstanding immediately prior to the Effective Time, rounded to the nearest thousandth of a share (0.001),Outstanding, multiplied by (B) 0.5, such product rounded to the nearest thousandth of a share (0.001) (the “Per Share Stock Consideration”).

(c)                                  The “Aggregate Share Amount” shall be determined as follows:

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(i)                                     If the unweighted average of the high and low sale prices of a share of common stock, without par value, of Wintrust (“Wintrust Common Stock”) as reported on the Nasdaq Global Select Market for each of the ten (10) trading days ending on the second (2nd) trading day preceding the Closing Date (the “Wintrust Common Stock Price”) (as defined below) is at least $39.50$64.00 and no more than $49.50,$76.00, the Aggregate Share Amount shall be the number of shares of Wintrust Common Stock equal to the quotient (rounded up to the nearest whole share) obtained by dividing (A) the Merger Consideration by (B) the Wintrust Common Stock Price;

(ii)                                  If the Wintrust Common Stock Price is less than $39.50,$64.00, the Aggregate Share Amount shall be 962,025the number of shares of Wintrust Common Stock (theequal to the quotient (rounded up to the nearest whole share) obtained by dividing the Merger Consideration divided by $39.50); and$64.00; or

(iii)                               If the Wintrust Common Stock Price is greater than $49.50,$76.00, the Aggregate Share Amount shall be 767,676the number of shares of Wintrust Common Stock (theequal to the quotient (rounded up to the nearest whole share) obtained by dividing the Merger Consideration divided by $49.50)$76.00.

(d)Certain Definitions.

(d)

(i)                                     The term “Company Common Stock Outstanding” shall mean the shares of common stock of the Company, $0.01 par value per share (“Company Common Stock”) issued and outstanding immediately prior to the Effective Time.

(ii)                                  “Wintrust Common Stock Price” shall mean the mathematical average, calculated for the five trading-day period ending on the second trading day preceding the Closing Date, of the volume-weighted average price (“VWAP”) of a share of Wintrust Common Stock for each trading day during such period as displayed under the heading “Bloomberg VWAP” on the Bloomberg Page for Wintrust (or its equivalent successor page if such page is not available).  If the Bloomberg Page or the Bloomberg VWAP is not available for a trading day, “VWAP” shall mean the volume-weighted average price of a share of Wintrust Common Stock for such trading day, as determined by a nationally recognized investment banking firm retained by Wintrust based on available trading information for shares of Wintrust Common Stock.

(e)                                  At the Effective Time, by virtue of the Merger and without any action on the part of the holder thereof, each share of common stock of the Company, $1.00 par value per share (“Company Common Stock”), issued and outstanding immediately prior to the Effective Time Outstanding (other than shares of Company Common Stock to be cancelled pursuant to Section 1.5 and Dissenting Shares, (asas defined in Section 1.8), shall be converted into the right to receive the Per Share Merger Consideration and thereupon shall no longer be outstanding and shall automatically be cancelled and retired and shall cease to exist.  Each certificate (or equivalent written record for shares held in book-entry format) previously evidencingrepresenting any such share of Company Common Stock Outstanding (a “Company Stock Certificate”) (other than shares cancelled pursuant to Section 1.5 and Dissenting Shares), shall thereafter represent only the right to receive, upon surrender of such certificate in accordance with Section 1.6(c)1.6(d), the Per Share Merger Consideration (and cash in lieu of any fractional shares in accordance with Section 1.7).  The holders of any such certificatesCompany Stock Certificates previously evidencingrepresenting such shares of Company Common Stock outstandingOutstanding immediately prior to the Effective Time shall cease to have any rights with respect thereto except as otherwise provided in this Agreement or by law.

(e)

(f)                                   If, between the date of this Agreement and the Effective Time, shares of Wintrust Common Stock shall be changed into a different number of shares or a different class of shares by reason of any reclassification, recapitalization, split-up, combination, exchange of shares or readjustment, or if a stock dividend thereof shall be declared with a record date within such period, then the number of shares of Wintrust Common Stock issued to holders of Company Common Stock Outstanding at the Effective Time pursuant to this Agreement will be appropriately and proportionally adjusted so that the number of such shares of Wintrust Common Stock (or such class of shares into which shares of Wintrust Common Stock have been changed) that will be issued in exchange for

the shares of

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Company Common Stock Outstanding in accordance with this Section 1.4 will equal in number of such shares that the holders of Company Common Stock Outstanding would have received pursuant to such reclassification, recapitalization, split-up, combination, exchange of shares, readjustment or stock dividend had the record date therefore had been immediately following the Effective Time.

(f)

(g)                                  Notwithstanding the foregoing, the Merger Consideration is subject to adjustment pursuant to Section 6.10(b)6.9(b).  In the event the Closing Balance Sheet of the Company reflects the Company’s shareholders’ equity atas greater than or less than the Minimum Adjusted Net Worth applicable to the Company, the Merger Consideration shall be increased or reduced (as the case may be) dollar-for-dollar by an amount equal to the amount of such shortfall.excess or shortfall, respectively.  Any such reductionadjustment shall be allocated equally to the cash and stock portionsportion of the Merger Consideration.Consideration to be paid in accordance with Section 1.4(b)(i).

1.5Cancellation of Treasury Shares.  At the Effective Time, each share of Company Common Stock held as treasury stock or otherwise held by the Company or CommunitySTC Capital Bank, CBD, a Wisconsinan Illinois state bank and wholly owned subsidiary of the Company (the “Bank”) (other than in a fiduciary capacity,capacity), if any, immediately prior to the Effective Time shall automatically be cancelled and retired and cease to exist, and no Per Share Merger Consideration shall be exchanged therefor.

1.6Exchange of CertificatesCertificates..

(a)                                 At orleast five business days prior to the Closing Date, Wintrustthe Company shall authorize the issuance of and shall make availabledeliver or cause to be delivered to American Stock Transfer & Trust Company, LLC, Wintrust’s Exchange Agent (the “Exchange Agent”), information detailing the respective name, address, taxpayer identification number, and Company Common Stock holdings of each of the Company’s shareholders, in a form reasonably satisfactory to the Exchange Agent.

(b)                                 At or prior to the Effective Time, Wintrust shall authorize the issuance of and shall make available to the Exchange Agent, for the benefit of the holders of shares of Company Common Stock Certificates for exchange in accordance with this ARTICLE I, (i) a sufficient number of shares of Wintrust Common Stock, to be issued by book-entry transfer, for payment of the Per Share Stock Consideration pursuant to Section 1.4(b)(ii), (ii) sufficient cash for payment of the Per Share Cash Consideration pursuant to Section 1.4(b)(i), and (iii) sufficient cash for payment of cash in lieu of any fractional shares of Wintrust Common Stock in accordance with Section 1.7.  Such amount of cash and shares of Wintrust Common Stock, together with any dividends or other distributions with respect thereto paid after the Effective Time, are referred to as the “Conversion Fund.” Wintrust shall be solely responsible for the payment of any fees and expenses of the Exchange Agent.

(b)

(c)                                  Within three (3)five (5) business days after the Closing Date, Wintrust shall cause the Exchange Agent to mail to each holder of record of one or moreshares of Company Common Stock Certificates a letter of transmittal (“Letter of Transmittal”), in form and substance mutually satisfactory to Wintrust and the form to be agreed by the Parties,Company, which specifies,shall specify, among other things, that delivery shall be effected, and risk of loss and title to any Company Stock Certificates shall pass, only upon delivery of such certificates to the Exchange Agent, together with instructions for use in properly effecting the surrender of the Company Stock Certificates pursuant to this Agreement.Agreement (each, a “Letter of Transmittal”).

(c) Promptly upon

(d)                                 Upon proper surrender of ashares of Company Common Stock, including any Company Stock CertificateCertificates, for exchange to the Exchange Agent, together with a properly completed Letter of Transmittal, duly executed, the holder of such shares of Company Common Stock Certificate shall be entitled to receive in exchange therefor (i) the Per Share Cash Consideration, (ii) the Per Share Stock Consideration, and (iii) the Per Share CashEscrowed Consideration deliverable in respect of the shares of Company

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Common Stock Outstanding represented by such Company Stock Certificate; thereupon such Company Stock Certificate shall forthwith be cancelled.  No interest will be paid or accrued on the Per Share Merger Consideration deliverable upon surrender of ashares of Company Stock Certificate.Common Stock.

(d)

(e)                                  After the Effective Time, there shall be no transfers on the stock transfer books of the Company of the shares of Company Common Stock that were issued and outstanding immediately prior to the Effective Time.Outstanding.

(e)

(f)                                   No dividends or other distributions declared with respect to Wintrust Common Stock and payable to the holders of record thereof after the Effective Time shall be paid to the holder of any unsurrendered shares of Company Common Stock Certificate until the holder thereof shall surrender such shares of Company Common Stock, including any Company Stock Certificate, in accordance with this ARTICLE I.  Promptly after the surrender of ashares of Company Common Stock Certificate in accordance with this ARTICLE I, the record holder thereof shall be entitled to receive any such dividends or other distributions, without interest thereon, which theretofore had become payable with respect to shares of Wintrust Common Stock into which the shares of Company Common Stock Outstanding represented by such shares of Company Common Stock Certificate were converted

at the Effective Time pursuant to Section 1.4.  No holder of an unsurrendered shares of Company Common Stock Certificate shall be entitled, until the surrender of such shares of Company Common Stock, Certificate, to vote the shares of Wintrust Common Stock into which such holder’s Company Common Stock Outstanding shall have been converted.

(f)

(g)                                  Any portion of the Conversion Fund that remains unclaimed by the shareholders of the Company twelve (12) months after the Effective Time shall be paid to the Surviving Corporation,Company, or its successors in interest.  Any shareholders of the Company who have not theretofore complied with this ARTICLE I shall thereafter look only to the Surviving Corporation,Company, or its successors in interest, for the issuance of the Per Share Stock Consideration, the payment of the Per Share Cash Consideration and the payment of cash in lieu of any fractional shares deliverable in respect of such shareholders’ shares of Company Common Stock Outstanding, as well as any accrued and unpaid dividends or distributions on such Per Share Stock Consideration.  Notwithstanding the foregoing, none of Wintrust, the Surviving Corporation,Company, the Exchange Agent or any other Person shall be liable to any former holder of shares of Company Common Stock for any amount delivered in good faith to a public official pursuant to applicable abandoned property, escheat or similar laws.

(g)

(h)                                 In the event any Company Stock Certificate shall have been lost, stolen or destroyed, upon the making of an affidavit of that fact by the person claiming such Company Stock Certificate to be lost, stolen or destroyed and the posting by such person of a bond in such amount as the Exchange Agent may determine is reasonably necessary as indemnity against any claim that may be made against it with respect to such Company Stock Certificate, the Exchange Agent will issue in exchange for such lost, stolen or destroyed Company Stock Certificate, and in accordance with this ARTICLE I, the Per Share Cash Consideration, the Per Share Stock Consideration and cash in lieu of any fractional shares deliverable in respect thereof pursuant to this Agreement.

1.7No Fractional SharesShares..  Notwithstanding anything to the contrary contained in this Agreement, no fractional shares of Wintrust Common Stock shall be issued as Per Share Stock Consideration in the Merger.  Each holder of shares of Company Common Stock Outstanding who would otherwise be entitled to receive a fractional share of Wintrust Common Stock pursuant to this ARTICLE I shall instead be entitled to receive an amount in cash (without interest) rounded to the nearest whole cent, determined by multiplying the Wintrust Common Stock Price by the fractional share of Wintrust Common Stock to which such former holder would otherwise be entitled.

1.8Dissenting SharesShares..Any holder of record of shares of Company Common Stock otherwise entitled to receive the Per Share Merger Consideration in exchange for each of his or her shares

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of Company Common Stock Outstanding shall be entitled to demand payment in cash of the fair value for his or her shares of Company Common Stock as specified in Sections 180.1301 through 180.1331Section 11.65 of the WBCLIllinois Business Corporation Act (the “IBCA”) if the holder fully complies with the requirements specified therein (such shares hereinafter referred to as “Dissenting Shares”).  No holder of Dissenting Shares shall, after the Effective Time, be entitled to receive any shares of Wintrust Common Stock or any payment of the Per Share Merger Consideration pursuant to this Agreement, or be entitled to vote for any purpose or receive any dividends or other distributions with respect to such Wintrust Common Stock;provided,however, that shares of Company Common Stock held by a dissenting shareholder who subsequently withdraws a demand for payment, fails to comply with the requirements of Sections 180.1301 through 180.1331Section 11.65 of the WBCL,IBCA, or otherwise fails to establish the right of such shareholder to receive payment in cash of the fair value of such shareholder’s shares under the WBCLIBCA shall be deemed to be converted into the right to receive the Per Share Merger Consideration in exchange for each such share, upon surrender of the certificate or certificates that formerly evidenced such Dissenting Shares in the manner set forth in Section 1.6.

1.9Company Stock OptionsOptions..

(a)                                 At the Effective Time, each option granted by the Company under the terms of the Delavan Bancshares, Inc. 2004 Executiveits 2005 Stock OptionIncentive Plan as amendedand its 2016 Equity Incentive Plan (the “Company Option PlanPlans”) to purchase Company Common Stock that is outstanding and unexercised immediately prior to the Effective Time (an “Outstanding Company Option”), shall, without any further action on the part of any holder thereof, be assumed and converted into an option to purchase shares of Wintrust Common Stock (a “Converted Option”) in such number and at such exercise price as set forth herein and otherwise having the same terms and conditions as in effect immediately prior to the Effective Time except to the extent that such Outstanding Company Options shall be altered in accordance with their terms as a result of the Merger contemplated hereby, as follows: (i) the number of shares of Wintrust Common Stock to be subject to the Converted Option shall be equal to the product obtained by multiplying (1) the number of shares of Company Common Stock subject to the original

Outstanding Company Option by (2) the quotient obtained by dividing an amount in cash equal to the aggregate value of the Per Share Merger Consideration (assuming for these purposes no deductions from the Escrow Amount or the Reserve Amount) by the Wintrust Common Stock Price (such quotient, the “Option Exchange Ratio”); (ii) the exercise price per share of Wintrust Common Stock under the Converted Option shall be equal to the quotient obtained by dividing (1) the exercise price per share of Company Common Stock under the original Outstanding Company Option by (2) the Option Exchange Ratio; and (iii) upon exercise of each Converted Option by a holder thereof, the aggregate number of shares of Wintrust Common Stock deliverable upon such exercise shall be rounded down, if necessary, to the nearest whole share and the aggregate exercise price shall be rounded up, if necessary, to the nearest cent.

(b)                                 The adjustments provided herein with respect to any Outstanding Company Options that are “incentive stock options” (as defined in Section 422 of the Code) shall be effected in a manner consistent with the requirements of Section 424(a) of the Code.

(c) The Company Option Plan shall be amended, effective as of

1.10Escrow Agreement.

(a)                                 At the Effective Time, Wintrust shall pay the Escrow Amount to provideThe Chicago Trust Company, N.A., as escrow agent (the “Escrow Agent”), to be held in the Escrow Account for the conversionperiod of Outstanding Company Options15 months for the purpose of funding (i) the Company’s indemnification obligations set forth in Section 8.2(a), and (ii) supplementing the Reserve Account in an amount not to exceed $500,000, to the extent deemed necessary by Shareholders’ Representative.  The Escrow Amount shall be held and released by the Escrow Agent in accordance with Section 1.9(a)the terms of an Escrow Agreement in the form attached hereto as Exhibit B (the “Plan AmendmentEscrow Agreement”).  Following release and delivery of the Escrow Disbursement (as such term is defined in the Escrow Agreement) by the Escrow Agent to the Exchange

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Agent, the Exchange Agent shall then distribute to each of the former shareholders of the Company, on a per share basis based on the number of shares of Company Common Stock previously held by each former shareholder of the Company, an amount equal to the quotient obtained by dividing (1) the Escrow Disbursement by (2) the total number of shares of Company Common Stock Outstanding, rounded to the nearest $0.01.  Distributions to the former shareholders of the Company shall be made using the instructions previously provided by each such shareholder to the Exchange Agent in his, her or its Letter of Transmittal delivered in accordance with this Agreement, unless such delivery instructions are modified in writing in accordance with the terms of each such Letter of Transmittal.

(b)                                 At the Effective Time, Wintrust shall pay the Reserve Amount to the Escrow Agent, to be held in the Reserve Account until such time that the Customer Litigation (as defined below) is resolved or concluded, through settlement, judgment or Shareholders’ Representative’s suspension of the pursuit of the Customer Litigation, for the purposes of funding (i) the obligations of the Company’s shareholders to indemnify Shareholders’ Representative for claims relating to actions taken under this Agreement, the Escrow Agreement and the Reserve Agreement, and (ii) the expenses of Shareholders’ Representative in connection with pursuing, litigating, settling and taking of any other actions relating to the litigation described on Schedule 1.10(b) (the “Customer Litigation”).  The CompanyReserve Amount shall provide to Wintrust, not less than five (5) business days prior tobe held and released by the Closing Date, copiesEscrow Agent in accordance with the terms of an escrow agreement in the form ofExhibit Battached hereto as Exhibit C(the “Option ConversionReserve Agreement”) from.  Following release and delivery of the Reserve Disbursement (as such term is defined in the Reserve Agreement) by the Escrow Agent to the Exchange Agent, the Exchange Agent shall then distribute to each of the holdersformer shareholders of Outstandingthe Company, Options acknowledging their agreement and consenton a per share basis based on the number of shares of Company Common Stock previously held by each former shareholder of the Company, an amount equal to the Plan Amendment andquotient obtained by dividing (1) the Reserve Disbursement by (2) the total number of shares of Company Common Stock Outstanding, rounded to the nearest $0.01.  Distributions to the former shareholders of the Company shall be made using the instructions previously provided by each such shareholder to the Exchange Agent in his, her or its Letter of Transmittal delivered in accordance with this Agreement, unless such delivery instructions are modified in writing in accordance with the terms of conversioneach such Letter of Transmittal.

1.11Shareholders’ Representative.

(a)                                 The decisions of the shareholders of the Company with respect to taking any and all actions specified or contemplated by this Agreement or as provided under the Escrow Agreement shall be determined by Anthony V. Sisto, who upon the requisite approval of the Company’s shareholders of this Agreement and the transactions contemplated hereby, shall be irrevocably constituted and appointed as the initial true and lawful agent and attorney-in-fact of all of the Company’s shareholders (“Shareholders’ Representative”) with full authority and power of substitution to act in the name, place and stead of such shareholder with respect to the consummation of the transactions contemplated under this Agreement and the Escrow Agreement, other than the authority and power to vote such shareholder’s shares of Company Common Stock in connection with the approval of this Agreement and any amendments to this Agreement.  Shareholders’ Representative shall be fully protected, held harmless and indemnified by the shareholders in exercising, or in declining to exercise, a power provided for or contemplated by this Agreement or as provided for in the Escrow Agreement for the benefit of all shareholders, as he shall determine to be in the interests of the shareholders.  To the extent necessary, such indemnification obligations shall be funded by the amount of funds held in the Reserve Account as set forth in the Reserve Agreement.  The actions or decisions of Shareholders’ Representative under this Section 1.9.Agreement shall bind each shareholder of the Company (or former shareholder of the Company, from and after the Effective Time), and no notice to or approval by the shareholders of such action shall be required.  Wintrust shall be entitled to rely on any action taken or decision made by Shareholders’ Representative (i) as may be contemplated by this Agreement and on any certificate or instrument related hereto provided by Shareholders’ Representative in his or her capacity as agent for the

1.10

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shareholders, and (ii) pursuant to the Escrow Agreement, for the benefit of the shareholders, and shall have no duty to inquire into the circumstances in which any such action is taken or such written instrument is provided.  If Anthony V. Sisto, as Shareholders’ Representative, should die or become unable or unwilling to perform his duties, or unable or unwilling to appoint a successor, then Keith Kotche shall be appointed as the successor Shareholders’ Representative, to serve in the same capacity as the prior Shareholders’ Representative.  If Shareholders’ Representative (and the above-referenced successor thereof) should die or become unable or unwilling to perform his duties, or unable or unwilling to appoint a successor, then Wintrust shall appoint any reasonable successor Shareholders’ Representative.  Any successor Shareholders’ Representative so appointed shall be vested with the same power and authority as the initial Shareholders’ Representative named above.

(b)                                 The decisions of the shareholders of the Company with respect to taking any and all actions as provided under the Reserve Agreement or relating to the Customer Litigation shall be determined by Shareholders’ Representative, who upon the requisite approval of the Company’s shareholders of this Agreement and the transactions contemplated hereby, shall be irrevocably constituted and appointed as the initial true and lawful agent and attorney-in-fact of all of the Company’s shareholders with full authority and power of substitution to act in the name, place and stead of such shareholder with respect to all actions taken pursuant to the Reserve Agreement and the Customer Litigation.  Shareholders’ Representative shall be fully protected, held harmless and indemnified by the shareholders in exercising, or in declining to exercise, a power provided for in the Reserve Agreement or relating to the Customer Litigation for the benefit of all shareholders, as he shall determine to be in the interests of the shareholders.  To the extent necessary, such indemnification obligations shall be funded by the amount of funds held in the Reserve Account as set forth in the Reserve Agreement.  The actions or decisions of Shareholders’ Representative relating to the Reserve Agreement and the Customer Litigation shall bind each shareholder of the Company (or former shareholder of the Company, from and after the Effective Time), and no notice to or approval by the shareholders of such action shall be required.  If Anthony V. Sisto, as Shareholders’ Representative, should die or become unable or unwilling to perform his duties, or unable or unwilling to appoint a successor, then Keith Kotche shall be appointed as the successor Shareholders’ Representative, to serve in the same capacity as the prior Shareholders’ Representative.  If Shareholders’ Representative (and the above-referenced successor thereof) should die or become unable or unwilling to perform his duties, or unable or unwilling to appoint a successor, then the Escrow Agent shall appoint any reasonable successor Shareholders’ Representative.  Any successor Shareholders’ Representative so appointed shall be vested with the same power and authority as the initial Shareholders’ Representative named above.

1.12Closing.  The consummation of the transactions contemplated by this Agreement shall take place at a closing (the “Closing”) to be held on the fifth (5th) business day following the date on which all of the conditions set forth in ARTICLE VI and ARTICLE VII have been satisfied, or on such other date as the Parties may mutually agree (the “Closing Date”).  In the event of the filing of any motion for rehearing or any appeal from the decision of any regulatory authorityGovernmental Authority approving the transactions contemplated in this Agreement or any legal proceedings of the type contemplated by Sections 6.5 or 7.5, Wintrust or the Company may postpone the Closing by written notice to the other partiesParties until such approvals have been obtained or such motion, appeal or litigation has been resolved, but in no event shall such Closing be postponed beyond the close of business on January 31, 2015February 29, 2020 (except as may be extended pursuant to Section 9.2(b)) without the consent of the boards of directors of Wintrust and the Company.  The Closing shall take place at 10:00 a.m., local time, on the Closing Date at the offices of Schiff Hardin LLP, 233 S. Wacker Drive, Suite 6600,7100, Chicago, Illinois, or at such other place and time upon which the Parties may agree.

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ARTICLE II

REPRESENTATIONS AND WARRANTIES CONCERNING THE COMPANY

Except as set forth in the specific Schedule relating to each specific anda corresponding Section or Subsection below, the Company hereby represents and warrants to Wintrust as of the date hereof and as of the Closing Date (except to the extent made only as of a specified date, in which case as of such date) as follows:

2.1Organization.

(a)                                 The Company is duly registered as a bank holding company under the Bank Holding Company Act of 1956, as amended (the “BHCA”), is a corporation duly organized, validly existing and in good standing under the laws of the State of Wisconsin,Illinois, and has the corporate power and authority to own its properties and to carry on its business as presently conducted.  The Company is duly qualified and in good standing as a foreign corporation in each other jurisdiction where the location and character of its properties and the business conducted by it require such qualification, except where the failure to be so qualified would not have a Material Adverse Effect on the Company.  As used in this Agreement, “Material Adverse Effect” shall mean changes, developments, occurrences or events having a material adverse effect on the financial condition, assets, liabilities, business or results of operations of the Company, the Bank, or the Bank Subsidiary (as defined below) or Wintrust, as referenced in such usage; provided, however, that “Material Adverse Effect” shall not be deemed to include the effects of (i) changes after the date hereof in general United States or global business, political, economic or market (including capital or financial markets) conditions, (ii) any outbreak, escalation or worsening of hostilities, declared or undeclared acts of war, sabotage, military action or terrorism, (iii) changes or proposed changes after the date hereof in United States generally accepted accounting principles (“GAAP”), promulgated bank regulatory accounting practices or authoritative interpretations thereof, (iv) changes or proposed changes after the date hereof in applicable

any U.S. federal, state or local or non-U.S. statute, law, ordinance, regulation, rule, order, decree, determination, treaty, or other requirement or rule of law (including common law) (each, a “law”) (in the case of each of these clauses (i), (ii), (iii) or (iv), other than changes, developments, occurrences or events to the extent that they have or would reasonably be expected to have a materially disproportionate adverse effect on the assets, liabilities, business or results of operations of the Company, the Bank or the Bank Subsidiarysuch Person as referenced in such usage), (v) the negotiation, execution or announcement of the Merger or this Agreement;Agreement, or (vi) any actions by the Parties as required or contemplated by this Agreement or taken with the consent of the other Parties.

(b)                                 The Bank is a state bank, duly chartered and organized, validly existing and currently authorized to transact the business of banking under the laws of the State of Wisconsin,Illinois, and has the requisite power and authority to own its properties and to carry on its business as presently conducted.

(c) CB Investments, Inc.                                  CRE Real Estate, LLC (the “Bank Subsidiary”) is a corporation, duly organized, validly existing and in good standing under the laws of the State of Nevada, and has the corporate power and authority to own its properties and to carry on its business as presently conducted. CBD Holdings, LLC, is a Wisconsin limited liability company, duly organized, validly existing and in good standing under the laws of the State of Wisconsin,Illinois, and has the organizational power and authority to own its properties and to carry on its business as presently conducted.  Ponds of Darien LLC, is a Wisconsin limited liability company, duly organized, validly existing and in good standing under the laws of the State of Wisconsin, and has the organizational power and authority to own its properties and to carry on its business as presently conducted. CB Investments, Inc., CBD Holdings, LLC and Ponds of Darien LLC are collectively called the “Bank Subsidiary” in this Agreement. Each entity constituting theThe Bank Subsidiary is duly qualified and in good standing as a foreign corporationentity in each other jurisdiction where the location and character of its properties and the business conducted by it require such qualification, except where the failure to be so qualified would not have a Material Adverse Effect on the Bank Subsidiary.  Each entity constituting theThe Bank Subsidiary is a wholly owned subsidiary of the Bank.  Except as set forth on Schedule 2.1(c), the Bank Subsidiary has no employees or independent contractors nor has it ever had any employees or independent contractors.

(d)                                 The Bank and Bank Subsidiary are sometimes referred to together in this Agreement as the “Company Subsidiaries.”  Other than (i) the Bank,Company Subsidiaries, (ii) the Bank Subsidiary, (iii) its investments in Investment Securities (as defined in Section 2.13(a)) and (iv)(iii) securities owned in a fiduciary capacity, or set forth onSchedule 2.1(d), the

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Company does not own, whether directly or indirectly, any voting stock, equity securities or membership, partnership, joint venture or similar ownership interest in any individual, corporation, association, partnership, trust, limited liability company, unincorporated organization or other entity or group (any such individual or entity, a “Person”), nor do any of the Company the Bank or the Bank SubsidiaryCompany Subsidiaries have any outstanding contractual obligations to provide funds or lend for investment purposes,to, or to make any investment (in the form of capital contribution or otherwise) in, any Person.Person, other than loan commitments by the Bank in the Ordinary Course of Business.

2.2Organizational Documents; Minutes and Stock RecordsRecords.  . The Company has furnished Wintrust with copies of the articles of incorporation and by-laws of eachbylaws of the Company, the charter and bylaws of the Bank, and the articles of organization and operating agreement of the Bank Subsidiary, and the charter and by-laws of the Bank, in each case as amended toor supplemented as of the date hereof,of this Agreement, and with such other documents as requested by Wintrust relating to the authority of the Company, the Bank, and the Bank Subsidiary to conduct their respective businesses (other than minutes reflecting discussions of confidential regulatory matters and discussions regarding the Merger and this Agreement).businesses.  All such documents are complete and correct.  The stock registers, and minute books and other applicable ownership records of the Company and each of the Bank and the Bank SubsidiaryCompany Subsidiaries are each complete, correct and accurately reflect, in each case in all material respects, all meetings, consents, and other actions of the organizers, incorporators, shareholders, board of directors, and committees of the boards of directors, trustees, managers and members, as applicable, of the Company and each of the Bank and the Bank Subsidiary, respectively,Company Subsidiaries, as applicable, and all transactions in each such entity’s capital stock or equity ownership occurring since the applicable initial date of organization, incorporation or formation of the Company and each of the BankCompany Subsidiaries.  The Company has furnished Wintrust with complete and correct copies of all such stock registers, minute books and other ownership records of the Bank Subsidiary, respectively.Company and each of the Company Subsidiaries, other than minutes reflecting discussions of confidential regulatory matters, discussions regarding the Merger and this Agreement, and discussions subject to attorney-client privilege).

2.3Capitalization.

(a)The Company.  The authorized capital stock of the Company consists of 400,0002,000,000 shares of common stock, $1.00Company Common Stock, $0.01 par value per share, of which 373,989449,229 shares are issued and outstanding as of the date of this Agreement and 2,489no shares are held in treasury.  The issued and outstanding shares of Company Common Stock have been duly and validly authorized and issued and are fully paid and non-assessable.  None of the shares of Company Common Stock are subject to any preferences, qualifications, limitations, restrictions or special or relative rights or privileges under the Company’s articles of incorporation as in effect as of the date of this Agreement.  Except for the Outstanding Company Options under the Company Option Plan,Plans, there are no options, warrants, agreements, contracts, or other rights in existence to purchase, acquire or acquirereceive from the Company any shares of capital stock of the Company, whether now or hereafter authorized or issued.  Except for the Voting Agreement to be

entered into concurrently with this Agreement and except as set forth on Schedule 2.3(a), there are no voting trusts, voting agreements, proxies or other agreements, instruments or undertakings with respect to the voting of any interests in the Company.Schedule 2.3(a) sets forth a true and complete list of (i) all shareholders of record of the Company, indicating their name and address of record and number of shares of capital stock of the Company held by each such shareholder.shareholders and (ii) all optionholders of record of the Company, indicating their name and address of record and number of options, grant date, expiration date and exercise price held by each such optionholder.

(b)The Bank.  The authorized capital stock of the Bank consists of 1,000,000300,000 shares of common stock, $1.00 par value per share, all of which 1,000,000 shares are issued and outstanding all of which areand owned by the Company.  The issued and outstanding shares of common stock of the Bank have been duly and validly authorized and issued and are fully paid and non-assessable (except as provided in Section 220.07 of Wisconsin Statutes) and owned by the Company.non-assessable.  There are no options, agreements, contracts, or other rights in existence to purchase or acquire from the Bank any shares of capital stock of the Bank, whether now or hereafter authorized or issued.  Other than the Bank Subsidiary

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and any Investment Securities held by the Bank, the Bank does not own, whether directly or indirectly, any voting stock, equity securities or membership, partnership, joint venture or similar ownership interest in any corporation, association, partnership, limited liability company or other entity.

(c)The Bank Subsidiary:

(i).  The authorized capital stockBank is the sole member of CB Investments, Inc. consists of 1,000 shares of common stock, $1.00 par value per share, of which 1,000 shares are issued and outstanding, all of which are owned by the Bank. The issued and outstanding shares of common stock of CB Investments, Inc. have been duly and validly authorized and issued and are fully paid and non-assessable and owned by the Bank.Bank Subsidiary.  There are no options, agreements, contracts, or other rights in existence to purchase or acquire from CB Investments, Inc.the Bank Subsidiary any sharesmembership units of capital stock of CB Investments, Inc.,the Bank Subsidiary, whether now or hereafter authorized or issued.

(ii)  The Bank owns 100% of the issued and outstanding member interests of CBD Holdings, LLC. The issued and outstanding member interests of CBD Holdings, LLC are duly and validly authorized and issued. The Bank is under no obligation to contribute additional capital to CBD Holdings, LLC. There are no options, agreements, contracts,Subsidiary does not own, directly or indirectly, any voting stock, equity securities or membership, partnership, joint venture or similar ownership interest in any corporation, association, partnership, limited liability company or other rights in existence to purchase or acquire additional member interests from CBD Holdings, LLC, whether now or hereafter authorized or issued.entity.

(iii) The Bank owns 100% of the issued and outstanding member interests of Ponds of Darien LLC. The issued and outstanding member interests of Ponds of Darien, LLC are duly and validly authorized and issued. The Bank is under no obligation to contribute additional capital to Ponds of Darien, LLC. There are no options, agreements, contracts, or other rights in existence to purchase or acquire additional member interests from Ponds of Darien, LLC, whether now or hereafter authorized or issued.

2.4Authorization; No ViolationViolation..

(a)The Company has full power and authority to execute and deliver this Agreement and to consummate the transactions contemplated hereby.  The execution and delivery of this Agreement and the performance of the Company’s obligations hereunder have been duly and validly authorized by the Board of Directors of the Company (the “Company Board”), and do not violate or conflict with the Company’s articles of incorporation, by-laws,bylaws, the WBCL,IBCA, or any applicable law, court order or decree to which the Company or any of the Bank or the Bank SubsidiaryCompany Subsidiaries is a party or subject, or by which the Company or any of the Bank or the Bank Subsidiary,Company Subsidiaries or any of their respective properties are bound, and no other action on the part of the Company is necessary to authorize the execution and delivery by the Company of this Agreement and the consummation by it of the transactions contemplated hereby, other than the requisite approval of the Merger by the shareholders of the Company.Company Shareholder Approval.  The execution and delivery of this Agreement and the performance of the Company’s obligations hereunder do not and will not result in any default or give rise to any right of termination, cancellation or acceleration under any material note, bond, mortgage, indenture or other agreement by which the Company, the Bank, the Bank Subsidiary or any of their respective properties are bound other than (i) the requisite prior approval of the Merger by the holders of the Company’s indebtedness referenced in Section 6.10 and (ii) the acceleration of certain indebtedness of the Company, as set forth onSchedule 2.4, upon a change in control or sale of substantially all of the Company’s assets.bound.  This Agreement, when executed and delivered by the Parties, and subject to the consents and regulatory approvals described in Section 2.5, will be a valid, binding and enforceable obligation of the Company, subject to applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors generally and to general principles of equity.

(b)                                 The Company Board, at a meeting duly called and held, duly and unanimously adopted resolutions (i) approving this Agreement and the other agreements referenced herein or attached hereto, (ii) approving the Merger and the other transactions contemplated hereby, (iii) determining that the terms of the Merger and such other transactions are fair to and in the best interests of the Company and its shareholders and (iv) recommending that the Company’s shareholders approve this Agreement.

2.5Consents and ApprovalsApprovals..  No consents or approvals of, or filings or registrations with, any court, administrative agency or commission or other governmental authority or instrumentality (each, a

Governmental Authority”) or with any third party are necessary in connection with the execution and delivery by the Company of this Agreement and the consummation by the Company of the Merger and the transactions contemplated hereby by, except for (a) those third-party consents, approvals, filings or registrations set forth onSchedule 2.5, (b) the filing by Wintrust of an application with the Board of Governors of the Federal Reserve System (the “Federal Reserve”) under the BHCA (the “Federal Reserve Application”), (c) the filing of an application with the Division of Banking of the Wisconsin Department of Financial Institutions (the “Wisconsin Application”, and together with the Federal Reserve Application the “Applications”), (d)(as defined in Section 3.4) and related approval, (c) the filing of the Articles of Merger with WDFI,the IL SOS under the Illinois LLC Act and (e)the IBCA, and (d) the approval of this Agreement and the Merger by the requisite vote of the shareholders of the Company.

2.6Financial Statements.Statements.  Schedule 2.6 sets forth true and complete copies of the following financial statements (collectively, the “Financial Statements”): (a) the audited consolidated balance sheets of the Company the Bank and the Bank SubsidiaryCompany Subsidiaries as of December 31, 2011, 20122017 and 2018 and the

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related statements of income, changes in shareholders’ equity and cash flows for the fiscal years then ended; (b) the audited consolidated balance sheet of the Company the Bank and the Bank SubsidiaryCompany Subsidiaries as of December 31, 20132018 (the “Audited Balance Sheet,” and such date, the “Audited Balance Sheet Date”) and the related statements of income, changes in shareholders’ equity and cash flows for the fiscal year then ended (the “Audited Financial Statements”); and (c) the unaudited consolidated interim balance sheet of the Company the Bank and the Bank SubsidiaryCompany Subsidiaries as of AugustMarch 31, 20142019 (the “Interim Balance Sheet”) and the related statements of income and changes in shareholders’ equity for the eight (8)-monththree-month period then ended (together with the Interim Balance Sheet, the “Interim Financial Statements”).  The Financial Statements are complete and correct and have been prepared in conformance with GAAP applied on a consistent basis throughout the periods involved.involved with respect thereto.  Each balance sheet (including any related notes) included in the Financial Statements presents fairly in all material respects the consolidated financial position of the Company the Bank and the Bank SubsidiaryCompany Subsidiaries as of the date thereof, and each income statement (including any related notes) and statement of cash flow included in the Financial Statements presents fairly in all material respects the consolidated results of operations and cash flow, respectively, of the Company the Bank and the Bank SubsidiaryCompany Subsidiaries for the period set forth therein;provided,however, that the Interim Financial Statements contain all adjustments necessary for a fair presentation, subject to normal, recurring year-end adjustments (which adjustments will not be, individually or in the aggregate, material), and lack footnotes.  Each of the Audited Financial Statements has been certified by the Company’s independent auditor, who has expressed an unqualified opinion on such Audited Financial Statements, and each of the Interim Financial Statements has been certified by the Company’s chief executive officer and principal accounting officer.  The books, records and accounts of each of the Company the Bank and the Bank SubsidiaryCompany Subsidiaries accurately and fairly reflect, in reasonable detail and in all material respects, all transactions and all items of income and expense, assets and liabilities and accruals relating to the Company and the Bank,Company Subsidiaries, as applicable.

2.7No Undisclosed LiabilitiesNeitherNone of the Company or the Bank nor the Bank SubsidiaryCompany Subsidiaries has any liabilities, whether accrued, absolute, contingent, or otherwise, existing or arising out of any transaction or, to the knowledgeKnowledge of the Company and the Bank, circumstancesor a Company Subsidiary, state of facts existing on or prior to the date hereof, except (a) as and to the extent disclosed, reflected or reserved against in the Financial Statements, (b) as and to the extent arising under contracts, commitments, transactions, or circumstances identified in the Schedules provided for herein, excluding any liabilities for Company, Bank or Bank Subsidiary breaches thereunder by the Company or any of the Company Subsidiaries, and (c) liabilities, not material in the aggregate and incurred in the Ordinary Course of Business and not material in the aggregate, which, under GAAP, would not be required to be reflected on a balance sheet prepared as of the date hereof.  An action taken in the “Ordinary Course of Business” shall mean an action taken in the ordinary course of business of the Company and each of the Bank or the Bank Subsidiary,Company Subsidiaries, as applicable, in conformityconsistent with past custom and practice (including with respect to quantity and frequency). and where for such action to be taken, no separate authorization by the Company Board, the board of directors of the Bank (the “Bank Board”), or the managers of the Bank Subsidiary, as applicable, is required, other than approval of Loans by the Bank Board.  Any liabilities incurred in connection with litigation or judicial, administrative or arbitration proceedings or claims against the Company, the Bank, or the Bank Subsidiary shall not be deemed to be incurred in the Ordinary Course of Business.

2.8Loans; Loan Loss ReservesReserves..

(a)                                 Each outstanding loan, loan agreement, note, lease or other borrowing agreement (including any overdraft protection extensions of credit), any participation therein and any guaranty, renewal or extension thereof (collectively, “Loans”) reflected on the books and records of the Bank is (i) evidenced by appropriate and sufficient documentation, adequate for the enforcement of the material terms of such Loans and of the related security interests, mortgages and other liens, and(ii) constitutes the legal, valid, and binding obligation of the obligor named therein, enforceable in accordance with its written terms, except to the extent such enforceability may be limited by applicable bankruptcy, insolvency, reorganization,

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moratorium or other similar laws affecting the enforcement of creditors’ rights and remedies generally from time to time in effect and by applicable laws which may affect the availability of equitable remedies.Except as provided in Schedule 2.8(a), noremedies, and (iii) constitutes and arose out of a bona fide business transaction.  No Loan has been amended, restated, supplemented, waived, extended, cancelled or otherwise modified, other than by a written instrument.  No obligor named in any

Loan has provided notice (whether written or, to the knowledge of the Company or the Bank, oral) to the Company or the Bank that such obligor intends to attempt to avoid the enforceability of any term of any Loan under any such laws or equitable remedies, and no Loan is subject to any valid defense, set-off, or counterclaim that has been threatened or asserted with respect to such Loan.  All Loans that are secured, as evidenced by the appropriate and sufficient ancillary security documents, are so secured by valid and enforceable liens.  Neither the Company nor the Bank has entered into any loan repurchase agreements.

(b)                                 The reservesallowances for loan and lease losses shown on each of the balance sheets contained in the Financial Statements are adequate in the judgment of management and consistent with applicable regulatory standards and under GAAP to provide for losses, net of recoveries relating to loans and leases previously charged off, on loans and leases outstanding (including accrued interest receivable) as of the applicable date of such balance sheet.  The aggregate loan balances of the Bank in excess of such reserves, in each case as shown on the Interim Balance Sheet, are, to the knowledge of the Company and the Bank, collectible in accordance with their terms.

2.9PropertiesProperties and Assets.

(a)Real Property.Schedule 2.9(a) sets forth a complete and correct list and brief description of all real property owned, leased, or rented by the Company, the Bank or the Bank Subsidiary or in which the Company, the Bank or the Bank Subsidiary has a legalan interest (other than as a mortgagee) (the(collectively, theReal Property”).  Except as set forth onSchedule 2.9(a), no real property or improvements are carried on the Company’s, the Bank’s or the Bank Subsidiary’s books and records as Other Real Estate Owned.Owned (including all deeds held in escrow and properties held by receivers) (“OREO”).  Schedule 2.9(a)(i) sets forth the properties owned by the Company or the Bank and used in connection with their banking business (the “Bank Owned Real Property”).  The Company, the Bank, and the Bank Subsidiary own or lease all Real Property used by them in the conduct of their respective businesses as such businesses are presently conducted.  Except as otherwise set forth onSchedule 2.9(a), or as disclosed in the Title Commitments, Surveys or Proforma Policies, the ownership of the Company, the Bank orand the Bank Subsidiary in such Real Property is not subject to any mortgage, pledge, lien, option, conditional salesales agreement, encumbrance, security interest, title exceptions or restrictions or claims or charges of any kind (collectively, “Encumbrances”), except for Permitted Encumbrances.  As used in this Agreement, “Permitted Encumbrances” shall mean (i) Encumbrances arising under conditional sales contracts and equipment leases with third parties under which the Company, the Bank, or the Bank Subsidiary is not delinquent or in default, (ii) carriers’, workers’, repairers’, materialmen’s, warehousemen liens’ and similar Encumbrances incurred in the Ordinary Course of Business that are not yet due and payable or that are being contested in good faith and for which proper reserves have been established and reflected on the Interim Balance Sheet, (iii) Encumbrances for taxes not yet due and payable or that are being contested in good faith and for which proper reserves have been established and reflected on the Interim Balance Sheet, (iv) minor exceptions or defects in title to real property or recorded easements rights-of-way, covenants, conditions or restrictionsrights-of-way, that in each case do not materially impair the use or operation thereof, (v) zoning, building and other similar restrictions on the use of real property that in each case do not materially impair the use or operation thereof, and (vi) in the case of any leased assets, (A) the rights of any lessor under the applicable lease agreement or any Encumbrance granted by any such lessor and (B) any statutory lien for amounts not yet due and payable, or that are being contested in good faith and for which proper reserves have been established and reflected on the Interim Balance Sheet.  All material certificates, licenses and permits required for the lawful use and occupancy of any real propertyReal Property by the Company, the Bank or the

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Bank Subsidiary, as the case may be, have been obtained and are in full force and effect.  Except as disclosed inset forth on Schedule 2.9(a), neithernone of the Company or any of the Bank nor the Bank SubsidiaryCompany Subsidiaries is the lessor or lessee of any real property.

(b)Personal Property; Sufficiency of Assets.Schedule 2.9(b) sets forth a complete and correct description of all material tangible personal property owned by the Company, the Bank orand the Bank Subsidiary, or used by the Company, the Bank orand the Bank Subsidiary, and havingbook value reflected as an Asset in the Interim Balance Sheet.  The Company, the Bank or the Bank Subsidiary, as applicable, has good, valid and validinsurable title to, or a valid leasehold interest in, all tangible and intangible assets used, intended or required for use by the Company, the Bank or the Bank Subsidiary in the conduct of their businesses, free and clear of any Encumbrances, except for Permitted Encumbrances, and all such tangible personal property is in good working condition and repair, normal wear and tear excepted.

2.10Material Contracts.Contracts.  Schedule 2.10 lists all Material Contracts, true and complete copies of which have been delivered to Wintrust, except with respect to those Material Contracts described in Section 2.10(g) for which the Company has delivered to Wintrust a complete and correct list and made available to Wintrust during the course of its due diligence investigation.Wintrust.  “Material Contracts” include every contract, commitment, or arrangement (whether written or oral) of a material nature (or that assumes materiality because of its continuing nature) under which the Company, the Bank or the Bank Subsidiary is obligated on the date hereof, including the following:

(a)                                 all agreements for consulting, professional, advisory, and other similar services, including engagement letters, and including contracts pursuant to which the Company, the Bank or the Bank Subsidiary performs services for others;

(b) any leases for real property for which the Company, the Bank or the Bank Subsidiary is a tenant, and any leases of personal property;

(c)                                 any contract (i) for the sale or conditional sale of or grant of preferential right to purchase any asset or(other than real property) or personal property of the Company, the Bank or the Bank Subsidiary, (otherin each case other than in the Ordinary Course of Business)Business, or (ii) for the sale or conditional sale of or grant of any preferential rightsright to purchase any assets orreal property of the Company, the Bank or the Bank Subsidiary or requiring consent of any partySubsidiary;

(c)                                  all property management agreements related to the transfer thereof;Real Property;

(d)                                 any contracts, commitments and agreements for the acquisition, development or disposition of real or personal property other than conditional sales contracts and security agreements whereunder total future payments are, in each instance, less than $100,000;$75,000;

(e)                                  all contracts relating to the employment, engagement, compensation or termination of directors, officers, employees, consultants or agents of the Company, the Bank or the Bank Subsidiary, and all pension, retirement, profit sharing, stock option, stock purchase, stock appreciation, insurance or similar plans or arrangements for the benefit of any employees, officers or directors of the Company, the Bank or the Bank Subsidiary, including all Benefit Plans as defined in Section 2.21;

(f)                                   all loans, loan commitments, promissory notes, letters of credit or other financial accommodations or arrangements or evidences of indebtedness, including modifications, waivers or amendments thereof, extended to or for the benefit of the Company, the Bank or the Bank Subsidiary;

(g)                                  all loans, loan commitments, promissory notes, letters of credit or other financial accommodations or arrangements or evidences of indebtedness, including modifications, waivers or amendments thereof, extended to or for the benefit of any single borrower or related group of borrowers if the aggregate amount of all such loans, loan commitments, promissory notes, letters of credit

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or other financial accommodations or arrangements or evidences of indebtedness extended to such borrower or related group of borrowers exceeds $500,000;

(h)                                 all agreements, contracts, mortgages, loans, deeds of trust, leases, commitments, indentures, notes, instruments and other arrangements which are withbetween (i) the Company, the Bank or the Bank Subsidiary, and (ii) officers or directors of the Company, the Bank or the Bank Subsidiary, any “affiliates” of the Company, the Bank or the Bank Subsidiary within the meaning of Section 23A of the Federal Reserve Act or any record or beneficial owner of 5% or more of Company Common Stock, or any member of the immediate family or a related interest (as such terms are defined in 12 C.F.R. §215.2(m)) of any such person, excepting any ordinary and customary loans and deposits that comply with applicable banking regulations;

(i)                                     any contract involving total future payments by the Company, the Bank or the Bank Subsidiary of more than $100,000$75,000 or which requires performance by the Company, the Bank or the Bank Subsidiary beyond the first anniversary of the Closing Date, that by its terms does not terminate or is not terminable by the Company, the Bank or the Bank Subsidiary, as applicable, without penalty within 30 days after the date of this Agreement;

(j)                                    except for provisions of the articles of incorporation and bylaws of the Company, the charter and bylaws of the Bank, or the articles of organization and operating agreement of the Bank Subsidiary, all contracts under which the Company, the Bank or the Bank Subsidiary has any obligation, direct, indirect, contingent or otherwise, to assume or guarantee any liability or to indemnify any person (other than in a fiduciary capacity and other than indemnification obligations contained in agreements entered into in the Ordinary Course of Business) (an “Indemnification Agreement”);

(k)                                 any contract granting an Encumbrance upon any assets or properties of the Company, the Bank or the Bank Subsidiary;

(k) except for provisions of the articles of incorporation and by-laws of the Company or the Bank or the articles of organization or operating agreement of the Bank Subsidiary,

(l)                                     any agreement to assume or guarantee any liability or to indemnifyproviding for indemnification of any Person (other than the Company, the Bank or the Bank

Subsidiary) with respect to liabilities relating to any current or former business of the Company, the Bank or the Bank Subsidiary, or any predecessor thereof (other than contained in agreements entered into in the Ordinary Course of Business);

(l)

(m)                             any powers of attorney (other than those entered into in the Ordinary Course of Business or contained in agreements entered into in the Ordinary Course of Business);

(m)

(n)                                 any confidentiality or non-disclosure agreement, other than customary agreements entered into in the Ordinary Course of Business or related to the transaction subject to this Agreement;Business;

(n)

(o)                                 any joint venture, partnership, marketing or similar agreements with any other Person; and

(o)

(p)                                 all other material contracts, made other than in the Ordinary Course of Business of the Company, the Bank or the Bank Subsidiary, or related to the transaction subject to this Agreement, to which either the Company, the Bank or the Bank Subsidiary is a party or under which either the Company, the Bank or the Bank Subsidiary is obligated.

2.11No Defaults.  Each of the Company, the Bank and the Bank Subsidiary has fulfilled and taken all action reasonably necessary to date to enable it to fulfill, when due, all of its material obligations under all Material Contracts to which it is a party.  There are no breaches or defaults by the Company, the Bank or the Bank Subsidiary under any Material Contract that could give rise to a

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right of termination or claim for material damages under such Material Contract, and no event has occurred that, with the lapse of time or the election of any other party, will become such a breach or default by the Company, the Bank or the Bank Subsidiary.  To the knowledge of the Company, the Bank and the Bank Subsidiary, no breach or default by any other party under any Material Contract has occurred or is threatened that will or could impair the ability of the Company, the Bank or the Bank Subsidiary to enforce any of its rights under such Material Contract.

2.12Conflict of Interest and Other TransactionsTransactions.. No  Except as set forth on Schedule 2.12, no officer, director, trustee or directormanager of the Company or any of the Bank, the Bank SubsidiaryCompany Subsidiaries, or holder of 10% or more of the Company Common Stock or any member of the immediate family or a related interest (as such terms are defined in 12 C.F.R. §215.2(m)) of such person: (a) has any direct or indirect ownership interest in (i) to the knowledge of the Company, any entity which does business with, or is a competitor of, the Company, the Bank or the Bank Subsidiary (other than the ownership of not more than 1% of the outstanding capital stock of such entity if such stock is listed on a national securities exchange or market or is regularly traded in the over-the-counter market by a member of a national securities exchange or market) or (ii) any property or asset which is owned or used by the Company, the Bank or the Bank Subsidiary in the conduct of their respective businesses; or (b) has any financial, business or contractual relationship or arrangement with the Company, the Bank or the Bank Subsidiary, excluding any agreements and commitments entered into in respect of the Bank’s acceptance of deposits and investments or the making of any loans, in each case in the Ordinary Course of Business of the Bank.

2.13Investments.

(a)                                 Set forth onSchedule 2.13(a)(i) is a complete and correct list and description as of AugustMay 31, 2014,2019, of all investment and debt securities, mortgage-backed and related securities, marketable equity securities and securities purchased under agreements to resell that are owned by the Company, the Bank or the Bank Subsidiary, other than, with respect to the Bank, in a fiduciary or agency capacity (the(collectively, theInvestment Securities”).  Except as set forth onSchedule 2.13(a)(ii) with respect to each Investment Security, the Company, the Bank or the Bank Subsidiary has good and marketable title to all Investment Securities held by it, free and clear of all Encumbrances, except for Permitted Encumbrances.  Except as set forth onSchedule 2.13(a)(iii), no Investment Securities are pledged to secure obligations of the Company, the Bank or the Bank Subsidiary.  The Investment Securities are valued on the books of the Company, the Bank and the Bank Subsidiary in accordance with GAAP.  Except as set forth onSchedule 2.13(a)(ii) and as may be imposed by applicable securities laws, noneNone of the Investment Securities is subject to any restriction, whether contractual or statutory, that materially impairs the ability of the Company, the Bank or the Bank Subsidiary to dispose of such investment at any time.  With respect to all material repurchase agreements to which the Company, the Bank or the Bank Subsidiary is a party, the Company, the Bank or the Bank Subsidiary, as the case may be, has a valid, perfected first lien or security interest in the

securities or other collateral securing each such repurchase agreement, and the value of the collateral securing each such repurchase agreement equals or exceeds the amount of the debt secured by such collateral under such agreement.

(b)                                 None of the Company, the Bank or the Bank Subsidiary has sold or otherwise disposed of any Investment Securities in a transaction in which the acquirer of such Investment Securities or other person has the right, either conditionally or absolutely, to require the Company, the Bank or the Bank Subsidiary to repurchase or otherwise reacquire any such Investment Securities.

(c)                                  There are no interest rate swaps, caps, floors, option agreements or other interest rate risk management arrangements to which the Company, the Bank or the Bank Subsidiary is bound.

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(d)                                 Each of the Company, the Bank and the Bank Subsidiary has made a good faith effort to achieve compliance with 12 U.S.C. § 1851 and the regulations promulgated in connection therewith (the “Volcker Rule”).  To the knowledge of the Company, the Bank and the Bank Subsidiary, in the absence of the transactions contemplated hereby, continuing to hold the Investment Securities in their current form would not form the basis for an assertion of any violation of 12 U.S.C. § 1851 and the regulations promulgated in connection therewith (the “Volcker Rule”) by any of the Company, the Bank or the Bank Subsidiary.

2.14Compliance with Laws; Legal Proceedings.Proceedings.

(a) Except as set forth onSchedule 2.14(a),                                 The Company and the Company the Bank and the Bank SubsidiarySubsidiaries are each in compliance in all material respects with all applicable federal, state, county and municipal laws and regulations (i) that regulate or are concerned in any way with the ownership and operation of banks, their holding companies and their subsidiaries or the business of banking or of acting as a fiduciary, including those laws and regulations relating to the investment of funds, the taking of deposits, the lending of money, the collection of interest, the extension of credit and the location and operation of banking facilities, or (ii) that otherwise relate to or affect the business or assets of the Company and the Bank or the Bank Subsidiary,Company Subsidiaries, or the assets owned, used, occupied or managed by any of them.them, except for matters concerning such compliance that would not be material to the Company or any of the Company Subsidiaries.

(b)                                 Without limiting the generality of the foregoing:

(i)UDAAP.  Neither the Company nor a Company Subsidiary has received any notice or communication from any Governmental Authority alleging violation of, or noncompliance with, any legal requirement concerning unfair or deceptive acts or practices, including Section 5 of the Federal Trade Commission Act (15 U.S.C. §§ 45), Regulation AA issued by the Board of Governors of the Federal Reserve System Regulation (12 CFR 227), and the Illinois Consumer Fraud and Deceptive Business Practices Act (815 Ill. Comp. Stat. Ann. 505), (each such legal requirement and the rules promulgated thereunder, a “UDAAP Law”).  Neither the Company nor a Company Subsidiary has been cited, fined or otherwise notified of any failure by it to comply with a UDAAP Law which has not been cured or otherwise satisfied in full.  To the knowledge of the Company or a Company Subsidiary, there are no facts or circumstances that could form the basis for assertion of any proceeding against the Company or a Company Subsidiary under any UDAAP Law that, if determined adversely to the Company or a Company Subsidiary, could reasonably be expected to adversely affect the Company or a Company Subsidiary.  No business practices of the Company or a Company Subsidiary could reasonably be considered to be unfair, deceptive, untrue, misleading or abusive in any material respect.  With respect to all of the Company’s and the Bank’s products, the corresponding consumer disclosures have reflected accurately, clearly and conspicuously the features of such products.

(ii)BSA/AML.  Neither the Company nor a Company Subsidiary has received any notice or communication from any Governmental Authority alleging violation of, or noncompliance with, any legal requirement concerning bank secrecy and anti-money laundering laws or regulations, including the Currency and Foreign Transactions Reporting Act of 1970 (also known as the Bank Secrecy Act), the Money Laundering Control Act of 1986, the Annunzio-Wylie Anti-Money Laundering Act of 1992, the Money Laundering Suppression Act of 1994, and the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (also known as the USA PATRIOT Act) (each such legal requirement and the rules promulgated thereunder, a “BSA/AML Law”).  Neither the Company nor the Bank has been cited, fined or otherwise notified of any failure by it to comply with a BSA/AML Law which has not been cured or otherwise satisfied in full.  To the knowledge of the Company or a Company Subsidiary, there are no facts or circumstances that could form the basis for assertion of any proceeding against the Company or a Company Subsidiary under any BSA/AML Law that, if determined adversely to the Company or a

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Company Subsidiary, could reasonably be expected to adversely affect the Company or a Company Subsidiary.

(iii)Fair Lending.  Neither the Company nor a Company Subsidiary has received any notice or communication from any Governmental Authority alleging violation of, or noncompliance with, any legal requirement concerning any fair lending laws or regulations, including the Equal Credit Opportunity Act and the Fair Housing Act (each such legal requirement and the rules promulgated thereunder, a “Fair Lending Law”).  Neither the Company nor a Company Subsidiary has been cited, fined or otherwise notified of any failure by it to comply with a Fair Lending Law which has not been cured or otherwise satisfied in full.  To the knowledge of the Company or a Company Subsidiary, there are no facts or circumstances that could form the basis for assertion of any proceeding against the Company or a Company Subsidiary under any Fair Lending Law that, if determined adversely to the Company or a Company Subsidiary, could reasonably be expected to adversely affect the Company or a Company Subsidiary.

(c)                                  Each of the Company the Bank and the Bank SubsidiaryCompany Subsidiaries holds all material licenses, certificates, permits, authorizations, franchises and rights from all appropriate federal, state or other Governmental Authorities necessary for the conduct of its business and the ownership of its assets (collectively, “Licenses”), all such Licenses are in full force and effect, and none of the Company or any of the Bank or the Bank SubsidiaryCompany Subsidiaries has received any notice (whether written or, to the knowledge of the Company or the Bank, oral) of any pending or threatened action by any Governmental Authority to suspend, revoke, cancel or limit any License.

(c)

(d)                                 Except as set forth onSchedule 2.14(c2.14(d)), there are no claims, actions, suits or proceedings pending or, to the knowledge of the Company or the Bank, threatened or contemplated against or affecting the Company the Bank or the Bank Subsidiary,Company Subsidiaries, at law or in equity, or before any federal, state or other Governmental Authority or any arbitrator or arbitration panel, whether by contract or otherwise, and there is no decree, judgment or order or formal supervisory agreement of any kind in existence against or restraining the Company the Bank or the Bank SubsidiaryCompany Subsidiaries from taking any action of any kind in connection with their respective businesses.  Except as set forth onSchedule 2.14(c2.14(d)), neithernone of the Company nor the Bankor Company Subsidiaries has received from any federal, state or other Governmental Authority any notice or threat (whether written or, to the knowledge of the Company or the Bank, oral) of formal enforcement actions, or any criticism or recommendation of a material nature concerning capital, compliance with laws or regulations, safety or soundness, fiduciary duties or other banking or business practices that has not been resolved to the reasonable satisfaction of such Governmental Authority, or disclosed to Wintrust in connection with its due diligence investigationand none of the Company the Bank and the Bank Subsidiary, and neitheror the Company nor the BankSubsidiaries has any reasonable basis for believing that any such notice or threat, criticism, recommendation or suggestion not otherwise disclosed herein is contemplated.

2.15Insurance.Insurance.  Schedule 2.15 sets forth a complete and correct list of all policies of insurance in which the Company or any of the Bank or the Bank SubsidiaryCompany Subsidiaries is named as an insured party, which otherwise relate to or cover any assets, properties, premises, operations or personnel of the Company the Bank or the Bank Subsidiary,Company Subsidiaries, or which is owned or carried by the Company the Bank or the Bank Subsidiary.Company Subsidiaries.  All such policies are legal, valid, binding, enforceable and in full force and effect as of the date hereof and will continue in effect until Closing (or if such policies are cancelled or lapse prior to Closing, renewals or replacements thereof will be entered

into in the Ordinary Course of Business).  No application for any such policies included a material misstatement or omission.  All premiums and costs with respect to such policies are set forth onSchedule 2.15 and have been paid to the extent due.  None of the Company or any of the Bank or the Bank SubsidiaryCompany Subsidiaries is in breach or default under any such policy, and, to the knowledge of the Company and the Bankor a Company Subsidiary, no event has occurred which, with notice or the lapse of time, would constitute a breach or default or permit termination, modification or acceleration, under such policy.  NoExcept as set forth on Schedule 2.15, no claim currently is pending under any such policy involving an

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amount in excess of $75,000.  All material insurable risks reasonably expected to be known by management in respect of the business and assets of the Company the Bank and the Bank SubsidiaryCompany Subsidiaries are covered by such insurance policies and the types and amounts of coverage provided therein are usual and customary in the context of the size of the Company and the Company Subsidiaries and the business and operations in which the Company the Bank and the Bank SubsidiaryCompany Subsidiaries are engaged.  None of the Company the Bank or the Bank SubsidiaryCompany Subsidiaries has received any notice (whether written or, to the knowledge of the Company and the Bank, oral) from any party of interest in or to any such policies claiming any breach or violation of any provisions thereof, disclaiming or denying coverage thereof or canceling or threatening cancellation of any such insurance contracts.

2.16Taxes.

(a)Definitions.  For the purposes of this Agreement, the term “Tax” or, collectively, “Taxes” shall mean (1) any and all U.S. federal, state, local and non-U.S. taxes, duties, fees, premiums, assessments, imposts, levies, tariffs and other charges of any kind whatsoever imposed, assessed, reassessed or collected by any governmental entity, including all interest, penalties, fines, installments, additions to tax or other additional amounts imposed, assessed, reassessed or collected by any governmental entity in respect thereof, and including those related to, or levied on, or measured by, or referred to as, net income, gross income, income as specially defined, earnings, profits or selected items of income, earnings or profits, gross receipts, royalty, capital, capital gain, sales, goods and services, harmonized sales, use, value added, ad valorem, transfer, land transfer, real property, capital stock, personal property, environmental, business, property development, occupancy, franchise, license, withholding, payroll, employment, employer health, health insurance, social services, education, all surtaxes, unemployment or employment insurance premiums, workers compensation payments, excise, severance, stamp, premium, escheat, or windfall profits, alternative or minimum taxes, customs duties, import and export taxes, countervail and anti-dumping, and registration fees, whether disputed or not and whether payable directly or by withholding and whether or not requiring the filing of a Tax Return; (2) any liability of the Company or any of the Bank or the Bank SubsidiaryCompany Subsidiaries for the Taxes described in clause (1) hereof arising as a result of being or ceasing to be a member of a consolidated, affiliated or combined group whether pursuant to Treasury Regulation §1.1502-6 (and any corresponding provision of state, local or foreign law) or otherwise; and (3) any liability for Taxes referenced in clauses (1) and (2) as a transferee, successor, guarantor, by contract or by operation of applicable laws or otherwise.

(b)Tax Returns and Audits.

(i)                                     The Company the Bank and the Bank SubsidiaryCompany Subsidiaries have each prepared and timely filed all material U.S. federal, state, local and non-U.S. returns, elections, notices, filings, declarations, forms, claims for refund, estimates, information statements, reports and other documents, including any amendments, schedules, attachments, supplements, appendices and exhibits thereto (“Tax Returns”), with the appropriate governmental entity in all jurisdictions in which such Tax Returns are required to be filed relating to any and all Taxes concerning or attributable to the Company or any of the Bank or the Bank Subsidiary,Company Subsidiaries, as applicable.  Such Tax Returns have been prepared and completed in accordance with applicable legal requirements in all material respects.Schedule 2.16(b)(i) lists all of the jurisdictions in which the Company and the Bank or the Bank Subsidiary isCompany Subsidiaries are required to file Tax Returns or pay Taxes.

(ii)                                  The Company and each of the Bank and the Bank SubsidiaryCompany Subsidiaries have duly and timely paid, or caused to be duly and timely paid, all Taxes that are due and payable by them (whether or not shown or required to be shown on any Tax Return).  All entity-level Taxes of the Company or any of the Company Subsidiaries for which the Company or any of the Company Subsidiaries is the primary obligor for the payment thereof that are due and payable with respect to

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income, assets and operations of the Company and each of the Company Subsidiaries have been duly and timely paid.

(iii)                               Each of the Company the Bank and the Bank SubsidiaryCompany Subsidiaries has duly and timely withheld or deducted all Taxes and other amounts required by applicable laws to be withheld or deducted by it, including Taxes and other amounts required to be deducted or withheld by it in respect of any amount paid or credited, or deemed to be paid or credited, by it to or for the account or benefit of any person, including any former or current Employees, officers or directors and any non-resident person, and has duly and timely remitted, or will duly and timely remit, as applicable, to the appropriate governmental entity such taxesTaxes and other amounts required by applicable laws to be remitted by it, for all periods ending on or prior to the Closing Date.

(iv)                              None of the Company the Bank or the Bank SubsidiaryCompany Subsidiaries has entered into any agreement or other arrangement, or executed any waiver, providing for any extension of time, including any statute of limitations on or outstanding extension of the period for the assessment or collection of any Tax, and none of the Company the Bank or the Bank SubsidiaryCompany Subsidiaries is a beneficiary of any such extension of time, which will be outstanding and in effect on the Closing Date, within which (A) to file any Tax Return covering any Taxes for which the Company or any of the Bank or the Bank Subsidiary, as applicable,Company Subsidiaries may be liable; (B) to file any elections, designations or similar filings relating to Taxes for which the Company or any of the Bank or the Bank Subsidiary, as applicable,Company Subsidiaries may be liable; (C) the Company or any of the Bank or the Bank SubsidiaryCompany Subsidiaries may be required to pay or remit Taxes or amounts on account of Taxes; or (D) any governmental entity may assess, reassess, or collect Taxes for which the Company or any of the Bank or the Bank Subsidiary, as applicable,Company Subsidiaries may be liable.

(v)                                 No audit or other examination of any Tax Return of any of the Company or any of the Bank or the Bank SubsidiaryCompany Subsidiaries is in progress, nor has the Company or any of the Bank or the Bank SubsidiaryCompany Subsidiaries been notified in writing of any request for such an audit or other examination.

(vi)                              There are no liens on the assets of the Company or any of the Bank or the Bank SubsidiaryCompany Subsidiaries relating to or attributable to Taxes, except for inchoate tax liens that are attached by operation of law.

(vii)                           None of the Company or any of the Bank or the Bank SubsidiaryCompany Subsidiaries has been at any time a “United States Real Property Holding Corporation” within the meaning of Section 897(c)(2) of the Code.

(viii)                        None of the Company or any of the Bank or the Bank SubsidiaryCompany Subsidiaries (1) has ever been a member of an affiliated group (within the meaning of Code §1504(a)) filing a consolidated, combined, unitary or similar Tax Return (other than a group the common parent of which was the Bank or the Company), (2) owes any amount under any Tax sharing, indemnification, allocation or similar agreement, (3) has ever been a party to or bound by any Tax sharing, indemnification, allocation or similar agreement, contract plan or arrangement allocating or sharing the payment of, indemnity for or liability for Taxes that will not be terminated on the Closing Date without any future liability to the Bank, the Company, Wintrust or any of their respective subsidiaries, (other than liabilities between the Company and the Bank), and (4) has any liability for the Taxes of any Person (other than the Bank) under Treas. Reg. § 1.1502-6 (or any similar provision of state, local or foreign law), as a transferee or successor, by contract, or otherwise.

(ix)                              No claim in writing has ever been made by any governmental entity in a jurisdiction in which the Company or any of the Company the Bank or the Bank SubsidiarySubsidiaries does not file Tax Returns that the Company or any of the Bank or the Bank Subsidiary,Company Subsidiaries, as applicable, is or may be subject to Taxes in such jurisdiction.

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(x)                                 None of the Company of the Bank or the Bank SubsidiaryCompany Subsidiaries has entered into, been a party to or otherwise participated (directly or indirectly) in any “listed transaction” within the meaning of Treasury Regulations Section 1.6011-4(b)(2) or any other “reportable transaction” within the meaning of Treasury Regulations Section 1.6011-4(b) or any transaction requiring disclosure under similar provisions of state, local or foreign Tax laws.

(xi)                              None of the Company the Bank or the Bank SubsidiaryCompany Subsidiaries has applied for any Tax ruling which,that, if granted, would affect the computation of Tax liability of the Company or any of the Bank or the Bank Subsidiary,Company Subsidiaries, as applicable, for any periods (or portions thereof) beginning on or after the Closing Date.

(xii)                           None of the Company the Bank or the Bank SubsidiaryCompany Subsidiaries has agreed to make, or is not required to make, any adjustment under Section 481(a) of the Code by reason of a change in accounting method or otherwise.

(xiii)                        There is no contract covering any current or former employee or current or former independent contractor of the Company or any of the Bank or the Bank SubsidiaryCompany Subsidiaries that, individually or

collectively, could give rise to a payment by the Company or any of the Bank or the Bank SubsidiaryCompany Subsidiaries (or the provision by the Company or any of the Bank or the Bank SubsidiaryCompany Subsidiaries of any other benefits such as accelerated vesting) that would not be deductible by the Company or any of the Bank or the Bank SubsidiaryCompany Subsidiaries by reason of Code Section 280G or would be subject to an excise Tax under Code Section 4999.  None of the Company the Bank or the Bank SubsidiaryCompany Subsidiaries has any indemnity obligations for any excise Taxes imposed under Code Section 4999 or for any Taxes of any employee, including the Taxes under Code Section 409A.

(xiv)                       The Company the Bank and the Bank SubsidiaryCompany Subsidiaries have disclosed on their Tax Returns all positions taken therein that could reasonably give rise to a substantial understatement of Taxes within the meaning of Code Section 6662.

(xv)                          The Company has not had more than 100 shareholders, has been a “small business corporation” within the meaning of Section 1361(b) of the Code, and has had in effect a valid election to be an “S corporation” under Section 1362(a) of the Code (and has validly been treated in a similar manner for purposes of the applicable Laws of all state and local jurisdictions in which it has been subject to taxation where such treatment is legally available), in each case, at all times during its existence; the Bank has been treated as a result of a valid applicable election as a “qualified subchapter S subsidiary” within the meaning of Section 1361(b)(3)(B) of the Code (and has been or will be validly treated in a similar manner for purposes of the applicable Laws of all state and local jurisdictions in which it has been subject to taxation where such treatment is legally available) at all times during its existence; the Bank Subsidiary has been treated for federal income tax purposes as a disregarded entity at all times during its existence; and no election has been filed with any Governmental Authority to treat the Company or any Company Subsidiary as an association taxable as a corporation for U.S. federal or applicable state and local income tax purposes.

2.17Environmental Laws and Regulations.Regulations.

(a) Except as set forth onSchedule 2.17, each                                 Each of the Company the Bank and the Bank Subsidiary:Company Subsidiaries:

(i)                                     has had and now has all material environmental approvals, consents, licenses, permits and orders required to conduct the business in which it has been or is now engaged; and

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(ii)                                  has been and is in compliance in all material respects with all applicable Environmental Laws (as defined in Section 2.17(d))below).

(b) Except as set forth onSchedule 2.17:

(i) there(b)                                 There are no claims, actions, suits or proceedings pending or, to the knowledge of the Company or the Bank, threatened or contemplated against, or involving, the Company or any of the Bank or the Bank Subsidiary,Company Subsidiaries, or any assets of any of the Company the Bank or the Bank Subsidiary,Company Subsidiaries, under any of the Environmental Laws (whether by reason of any failure to comply with any of the Environmental Laws or otherwise);.

(ii) no

(c)                                  No decree, judgment or order of any kind under any of the Environmental Laws has been entered against the Company the Bank or the Bank Subsidiary;

(iii) noneany of the Company Subsidiaries.

(d)                                 None of the BankCompany or the Bank SubsidiaryCompany Subsidiaries is or in the last ten (10) years, has been:ever:

(A)

(i)                                     been a generator or transporter of hazardous waste, (as defined below), or the owner, operator, lessor, sublessor, lessee or, to the knowledge of the Company and the Bank, mortgagee of a treatment, storage, or Disposal facility or underground storage tank as those terms are defined under the Resource Conservation and Recovery Act, as amended, or regulations promulgated thereunder, or of real property on which such a treatment, storage or Disposal facility or underground storage tank is or was located; or

(B) an arranger or

(ii)                                  arranged for the Disposal or treatment, or arranged with a transporter for transport for Disposal or treatment of Hazardous Materials at any facility from which there is a releaseRelease (as defined below) or threat of release,Release, or accepts or accepted Hazardous Materials for transport for Disposal or treatment at any facility;

(iv) none of the Company, the Bank or the Bank Subsidiary is or, to the knowledge of the Company, in the last ten (10) years has been:

(A)(iii)                               been the holder of a security interest where the party giving the security is or was the owner or operator of a treatment, storage or Disposal facility, underground storage tank or any facility at which any Hazardous Materials are or were treated, stored in significant quantities, recycled or disposed and where either the Company or any of the Bank or the Bank SubsidiaryCompany Subsidiaries participates or participated in management decisions concerning the facility’s Hazardous Materials Disposal activities; or

(B)

(iv)                              owned, operated, leased, subleased or, to the owner, operator, lessee, lessor, sublessee, sublessorknowledge of the Company or holder ofthe Bank, held a security interest in (1) any facility at which any Hazardous Materials were treated, stored in significant quantities, recycled, disposed or are or were installed or incorporated into the structure or (2) any real property on which such a facility is or was located.

(c)(e)                                  To the knowledge of the Company or the Bank there is no asbestos or asbestos-containing materials, or lead-based paint, used in, present or applied to any building, structure, equipment or other form located on the Real Property.

(f)                                   The Company has provided to Wintrust copies of all environmental assessments and reports that the Company, the Bank or the Bank Subsidiary has obtained in connection with any of the Real Property, and the findings of each such assessment or report are consistent with the representations and warranties set forth above.

(g)                                  To the knowledge of the Company or the Bank, there are no other facts, conditions or situations, whether now or heretofore existing, that could form the basis for any claim against, or result in any liability of, the Company the Bank or the Bank Subsidiary under any of the Company Subsidiaries under any Environmental Laws.Law.

(d)

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(h)                                 “Environmental Laws” means all applicable federal, state and local statutes, regulations, ordinances, rules and policies, all court and administrative orders and decrees, all arbitration awards, and the common law, which pertain to Hazardous Materials or protection of human health and safety.

(i)                                     “Hazardous Materials” means (A) pollutants, contaminants, pesticides, petroleum or petroleum products, radioactive substances, solid wastes or hazardous or extremely hazardous, special, dangerous, or toxic wastes, substances, chemicals or materials within the meaning ofthat are considered to be hazardous or toxic under any Environmental Law, including any “hazardous substance” as defined in or under the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C., Sec. 9601, et seq., as amended and reauthorized (“CERCLA”), and any “hazardous waste” as defined in or under the Resource Conservation and Recovery Act, 42 U.S.C., Sec. 6902, et seq. (“RCRA”), and all amendments thereto and reauthorizations thereof, and (B) any other pollutants, contaminants, hazardous, dangerous or toxic chemicals, materials, wastes or other substances, including any industrial process or pollution control waste or asbestos, which pose a hazard to the environment or the health and safety of any person.  “Disposal” means the discharge, deposit, injection, dumping, spilling, leaking, or placing any materials, wastes or substances into the environment.

(j)                                    “Environmental LawsReleasemeans all federal, stateshall mean any spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, dumping or disposing into the environment (including the abandonment or discarding of barrels, containers and local statutes, regulations, ordinances, rules and policies, all court and administrative orders and decrees, all arbitration awards, andother closed receptacles containing any Hazardous Material), either on the common law,Real Property or migrating from the Real Property onto another property, whether or not notification or reporting to any governmental authority was or is required, including any Release which pertainis subject to environmental or natural resource matters or contamination of any type whatsoever.Environmental Laws.

2.18Community Reinvestment Act ComplianceCompliance..Neither the Company nor the Bank has received any notice of non-compliance with the applicable provisions of the Community Reinvestment Act (“CRA”) and the regulations promulgated thereunder, and the Bank has received a CRA rating of satisfactory“satisfactory” or better from the Federal Deposit Insurance Corporation (“FDIC”) or other applicable Governmental Authority.  Neither the Company nor the Bank knows of any facts or circumstances which would cause the Bank to fail to comply with such provisions or the Bank to receive a rating less than satisfactory.“satisfactory.”

2.19Regulatory ReportsReports..Since June 30, 2013,January 1, 2018, the Company the Bank and the Bank SubsidiaryCompany Subsidiaries have each timely filed all reports, registrations and statements, together with any amendments required to be made with respect thereto, required to be filed with the Federal Reserve, the FDIC, the WisconsinIL SOS, the Illinois Department of Financial Institutionsand Professional Regulation (“IDFPR”) and any other Governmental Authority or self-regulatory organization with jurisdiction over any of the activities of the Company or any of the Bank or the Bank SubsidiaryCompany Subsidiaries (the “Regulatory Reports”), and have paid all fees and assessments due and payable in connection therewith.  As of their respective dates, the Regulatory Reports complied in all material respects with the statutes, rules and regulations enforced or promulgated by the applicable regulatory authorityGovernmental Authority with which they were filed and did not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statement therein, in light of the circumstances under which they were made, not misleading.

2.20Employee MattersMatters..

(a)                                 (i)  Neither the Company nor the Bank has entered into, nor is the Company or the Bank otherwise bound by, any collective bargaining agreements that are now in effect with respect to their respective employees nor has the Company or the Bank experienced any labor disturbance, slow-down, strike, lockout, material grievance, claim of unfair labor practices, or other

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dispute relating to any union or collective bargaining within the past three (3) years; (ii) there is no labor strike, labor dispute, or work slow-down, stoppage or lockout pending or, to the knowledge of the Company and the Bank, threatened against or affecting the Company or the Bank; (iii) to the knowledge of the Company and the Bank, no union organization campaign is threatened or in progress with respect to any of the employees of the Company or the Bank, and no question concerning representation exists respecting such employees; (iv) there is no unfair labor practice charge or complaint threatened or pending against the Company or the Bank before the National Labor Relations Board; and (v) neither the Company nor the Bank has agreed to recognize any union or other collective bargaining representative, and no union or other collective bargaining representative has been certified as the exclusive bargaining representative of

any of the employees of the Company or the Bank.  Neither the Company nor the Bank has committed any unfair labor practice.  To the knowledge of the Company and the Bank, (1) no event has occurred or circumstance exists that could provide the basis for any work slow-down or stoppage or other labor dispute and (2) there is no organizational effort presently being made or threatened by or on behalf of any labor union with respect to employees of the Company or the Bank.

(b)Schedule 2.20(b) sets forth the name, job title and date of commencement of employment with respect to each current employee of the Company andor the Bank (the “Employees”). their respective name, date of commencement of employment, job title, full-time or part-time status, and classification as either “exempt” or “non-exempt” from requirements under applicable law regarding payment of overtime.

(c)                                  The Company and the Bank have complied and are in compliance in all material respects with all laws relating to the employment of labor, including any provisions thereof relating to (i) wages, hours, bonuses, commissions, termination pay, vacation pay, sick pay, fringe benefits, employee benefits, health insurance continuation (COBRA), and the payment and/or accrual of the same and all insurance and all other costs and expenses applicable thereto; (ii) unlawful, wrongful, retaliatory, harassing, or discriminatory employment or labor practices; (iii) occupational health and safety standards; (iv) employment taxes, deductions, reporting and licensure requirements, and (v) plant closing, mass layoff, immigration, workers’ compensation, disability, unemployment compensation, whistleblower laws, driver regulations, and other employment laws, regulations and ordinances.  The Company and the Bank are in material compliance with the Immigration Reform and Control Act of 1986 and maintain a current Form I-9, as required by such Act, in the personnel file of each employee hired after November 9, 1986 and the Company and the Bank have verified that each and every employee who is currently working in the United States is eligible to work in the United States.

(d)                                 The books and records of the Company and the Bank, including personnel files, contain no reference to any charge, grievance or complaint made against, or disciplinary proceeding initiated by the Company or the Bank with respect to, any Employee concerning an alleged violation of the Company’s or the Bank’s employee handbook or code of ethics, including any provisions therein that relate to sexual harassment or misconduct, nor to the knowledge of the Company or the Bank have any such charges, grievances or complaints ever been made, or any such disciplinary proceedings initiated in each case, with respect to any Employee.

(e)                                  All employees of the Company and the Bank have been or will have been on or before the Closing, paid in full by the Company or the Bank, as applicable, for all earned wages, salaries, commissions, bonuses (including any bonuses or incentive compensation related to the transactions contemplated by this Agreement), vacation pay, sick pay, and other compensation for all services performed by such employees up to and including the Closing or any such unpaid amounts existing at the time of the Closing will be properly reflected in the Closing Balance Sheet.  All Employees have been and are properly classified as either “exempt” or “non-exempt” from requirements under applicable law regarding payment of overtime.  All independent contractors who have worked for the Company or the Bank at any time are and have been properly classified as independent contractors

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pursuant to all applicable regulations.  The Company and the Bank have withheld all amounts required by law or by agreement to be withheld from the wages, salaries and other payments to their respective employees and are not liable for any arrears of wages or any taxes or any penalty for failure to comply with any of the foregoing.  To the knowledge of the Company and the Bank, no officer of either the Company or the Bank intends to terminate employment with the Company or the Bank prior to or following the Closing.

(e)

(f)                                   The Bank Subsidiary does not have, nor has the Bank Subsidiary ever had, any employees.

2.21Employee Benefit Plans.Plans.

(a)Schedule 2.21(a) includes a complete and correct list of each employee welfare benefit plan and employee pension benefit plan within the meaning of ERISA Sections 3(1) and 3(2), respectively (the “ERISA Plans”), each compensation, consulting, employment or collective bargaining agreement, and each stock option, stock purchase, stock appreciation right, life, health, disability or other insurance or benefit, bonus, deferred or incentive compensation, severance or separation, profit sharing, retirement, or other employee benefit plan, practice, policy or arrangement of any kind, oral or written, covering employees or former employees of the Company or the Bank which the Company or the Bank maintain or contribute to (or, with respect to any employee pension benefit plan has maintained or contributed to since the date of its incorporation) or to which the Company or the Bank is a party or by which it is otherwise bound (collectively, together with the ERISA Plans, the “Benefit Plans”).  Neither the Company nor the Bank has, and has ever had, an affiliate that would be treated as a single employer together with the Company or the Bank (an “ERISA Affiliate”) under Section 414 of the Code other than the Company and the Bank with respect to each other.  The Company previously has delivered to Wintrust true and complete copies of the following with respect to each Benefit Plan: (i) copies of each Benefit Plan, and all related plan descriptions; (ii) the last three years’ Annual Returns on Form 5500, including all schedules thereto and the opinions of independent accountants, for each Benefit Plan for which an Annual Return on Form 5500 was required to be filed;accountants; and (iii) other material plan documents.  In addition, the Company has delivered to Wintrust true and complete copies of the following:

(i)                                     all contracts with third party administrators, actuaries, investment managers, consultants, insurers, and independent contractors that relate to any Benefit Plan;

(ii)                                  all notices and other communications that were given by the Company, the Bank or any Benefit Plan to the IRS, the Department of Labor, the Pension Benefit Guaranty Corporation (“PBGC”PBGC), or any participant or beneficiary, pursuant to applicable law, within the four years preceding the date of this Agreement; and

(iii)                               all notices or other communications that related to the Company, the Bank or any Benefit Plan that were given by the IRS, the PBGC, or the Department of Labor to the Company, the Bank or any Benefit Plan within the four years preceding the date of this Agreement; andAgreement.

(iv) with respect to Benefit Plans subject to ERISA Title IV, the Form PBGC-1 filed for each of the three most recent plan years.

(b) Except as set forth onSchedule 2.21(b), neither                                 Neither the execution and delivery of this Agreement nor the consummation of the transactions contemplated hereby will cause an increase payment, vesting or acceleration of benefits or benefit entitlements to employees or former employees of the Company or the Bank under any Benefit Plan or any other increase in the liabilities of the Company or the Bank under any Benefit Plan as a result of the transactions contemplated by this Agreement.

(c)                                  Neither the Company nor the Bank maintains or participates in, nor has ever maintained or participated in, (i) a Benefit Plan that is subject to Title IV of ERISA or (ii) a

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multiemployer plan within the meaning of Section 3(37) of ERISA.  Neither the Company nor the Bank or, to their knowledge, any director or employee of the Company or the Bank, or any fiduciary of any ERISA Plan has engaged in any transaction in violation of Section 406 or 407 of ERISA or, to the Company’s or the Bank’s knowledge, any “prohibited transaction” (as defined in Section 4975(c)(1) of the Code) for which no exemption exists under Section 408(b) of ERISA or Section 4975(d) of the Code in connection with such ERISA Plan.  The Company and the Bank do not provide and have never provided medical benefits, life insurance or similar welfare benefits to former employees, except as required by Section 601 of ERISA.

(d)                                 Each ERISA Plan that is intended to qualify under Section 401 and related provisions of the Code is the subject of a favorable determination letter from the Internal Revenue Service (“IRS”), or satisfies the provisions of IRS Announcement 2001-77, Section II, if applicable, to the effect that it is so qualified under the Code and that its related funding instrument is tax exempt under Section 501 of the Code (or the Company and the Bank are otherwise relying on an opinion letter issued to the prototype sponsor), and, to the knowledge of the Company and the Bank, there are no facts or circumstances that would adversely affect the qualified status of any ERISA Plan or the tax-exempt status of any related trust.  The Company has provided Wintrust with copies of the most recent IRS determination letters (or opinion or advisory letters) for each Benefit Plan that is intended to qualify under Section 401 and related provisions of the Code.

(e) Except as set forth onSchedule 2.21(e), each                                  Each Benefit Plan is, and since its inception has been, administered in material compliance with its terms and with all applicable laws, rules and regulations governing such Benefit Plan, including the rules and regulations promulgated by the U.S. Department of Labor, the Pension Benefit Guaranty Corporation and the IRS under ERISA, the Code or any other applicable law, including without limitation the requirement to file Annual Returns on Form 5500.  None of the Company, the Bank or any affiliate of the Company or the Bank that is a fiduciary with respect to any Benefit Plan has breached any of the responsibilities, obligations or duties imposed on it by ERISA.  No Benefit Plan is currently the subject of a submission under IRS Employee Plans Compliance Resolution System or any similar system, nor under any Department of Labor amnesty program, nor does the Company or the Bank anticipate any such submission of any Benefit Plan.

(f)                                   Other than routine claims for benefits made in the Ordinary Course of Business, there is no litigation, claim or assessment pending or, to the knowledge of the Company and the Bank, threatened by, on behalf of, or against any of the Benefit Plans or against the administrators or trustees or other fiduciaries of any of the Benefit Plans that alleges a violation of applicable state or federal law or violation of any Benefit Plan document or related agreement.  To the knowledge of the Company and the Bank, there is no reasonable basis for any such litigation, claim or assessment.

(g)                                  No Benefit Plan fiduciary or any other person has, or has had, any liability to any Benefit Plan participant, beneficiary or any other person under any provisions of ERISA or any other applicable law by reason of any action or failure to act in connection with any Benefit Plan, including any liability by any reason of any payment of, or failure to pay, benefits or any other amounts or by reason of any credit or failure to give credit for any benefits or rights.  Every Benefit Plan fiduciary and official is bonded to the extent required by Section 412 of ERISA.

(h)                                 All accrued contributions and other payments to be made by the Company or the Bank to any Benefit Plan (i) through the date hereof have been made or reserves adequate for such purposes have been set aside therefor and reflected in the Financial Statements and (ii) through the Closing Date will have been made or reserves adequate for such purposes will have been set aside therefore and reflected in the Financial Statements.  Neither the Company nor the Bank is in default in performing any of its respective contractual obligations under any of the Benefit Plans or any related

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trust agreement or insurance contract.  There are no outstanding liabilities with respect to any Benefit Plan other than liabilities for benefits to be paid to participants in such Benefit Plan and their beneficiaries in accordance with the terms of such Benefit Plan.  Except to the extent reserved for and reflected in the Financial Statements in accordance with this Section 2.21(h), neither the Company nor the Bank has committed to, or announced, a change to any Benefit Plan that increases the cost of the Benefit Plan to the Company or the Bank, other than as set forth onSchedule 2.21(h).Bank.

(i)                                     Except as set forth onSchedule 2.21(i), no Benefit Plan provides for payment of any amount which, considered in the aggregate with amounts payable pursuant to all other Benefit Plans, would exceed the amount deductible for federal income tax purposes by virtue of Section 280G or 162(m) of the Code.

(j) Except as set forth onSchedule 2.21(j), the                                    The provisions of any Benefit Plan that constitutes a “non-qualified deferred compensation plan” under Code Section 409A, and the operation of any such plan, have at all times been in compliance with Code Section 409A or guidance issued thereunder.

(k) Except as set forth onSchedule 2.21(k), there                                 There are no obligations or liabilities, whether outstanding or subject to future vesting, for any post-retirement benefits to be paid to participants under any of the Benefit Plans or otherwise.  The Company and the Bank have complied in all material respects with the requirements for continued healthcare coverage under ERISA Section 601 et seq. and Code Section 4980B.

(l) With respect to each Benefit Plan that is subject to ERISA Title IV (a “Title IV Plan”):

(i)(l)                                     The Company andconsummation of the Bank have at all times mettransactions contemplated by this Agreement will not result in the minimum funding standard, and has made all contributions required, under ERISA § 302 and Code § 412;

(ii) The Company and the Bank have paid all amounts due to the Pension Benefit Guaranty Corporation (the “PBGC”);

(iii) Neither the Company nor the Bank has ceased operations at any facilitypayment, vesting, or withdrawn from any Title IV Plan in a manner that would subject any entity, the Company or the Bank to liability under ERISA § 4062(e), § 4063, or § 4064;

(iv) Neither the Company nor the Bank has ever filed a notice of intent to terminate any Title IV Plan or adopted any amendment to treat a Title IV Plan as terminated. The PBGC has not instituted proceedings to treat any Title IV Plan as terminated. No event has occurred or circumstance exists that may constitute grounds under ERISA § 4042 for the termination of, or the appointment of a trustee to administer, any Title IV Plan;

(v) No amendment has been made, or is reasonably expected to be made, to any Title IV Plan that has required or could require the provision of security under ERISA § 307 or Code § 401(a)(29);

(vi) Since the last valuation date for each Title IV Plan, no event has occurred or circumstance exists that would increase the amount of benefits under any Title IV Plan or that would cause the excess of Title IV Plan assets over benefit liabilities (as defined in ERISA § 4001) to decrease, or the amount by which benefit liabilities exceed assets to increase;

(vii) No reportable event (as defined in ERISA § 4043 and in regulations issued thereunder) has occurred; and

(viii) Except as set forth in Schedule 2.21(l)(viii), neither the Company nor the Bank has any knowledgeacceleration of any facts or circumstances that may give rise to any liability of the Company,benefit by the Bank or Wintrust to the PBGC under Title IV of ERISA.any Benefit Plan.

(m) To the knowledge of the Company, the Bank and the Bank Subsidiary, no                             No condition exists as a result of which the Company would have any liability, whether absolute or contingent, under any Benefit Plan with respect to any misclassification of a person performing services for the Company or the Bank as an independent contractor rather than as an employee.

(n)                                 The Company and the Bank each have the right to modify and terminate benefits to retirees (other than pensions provided pursuant to Title IV Plans) with respect to both retired and active employees.

2.22Technology and Intellectual Property.Property.

(a)Schedule 2.22 sets forth a complete and correct list of all (i) registered trademarks, service marks, domain names, copyrights and patents; (ii) applications for registration or grant of any of the foregoing; (iii) unregistered trademarks, service marks, trade names, logos and assumed names; and (iv) licenses for any of the foregoing, in each case, owned by or for the benefit of the Company, the Bank or the Bank Subsidiary, or used in or necessary to conduct the Company’s, the Bank’s or the Bank Subsidiary’s business as presently conducted.  The items onSchedule 2.22, together with all other trademarks, service marks, trade names, logos, assumed names, patents, copyrights, trade secrets, computer software, licenses, formulae, customer lists or other databases, business application designs and inventions currently used in or necessary to conduct the businesses of the Company, the Bank and the Bank Subsidiary, constitute the “Intellectual Property.”

(b)                                 The Company, the Bank or the Bank Subsidiary has ownership of, or such other rights by license, lease or other agreement in and to, the Intellectual Property as is necessary to permit the Bank to use the Intellectual Property in the conduct of its business as presently conducted.  Neither the Company nor the Bank has received any notice (whether written or, to the knowledge of the Company and the Bank, oral) alleging that the Company, the Bank or the Bank Subsidiary has infringed

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or violated any trademark, trade name, copyright, patent, trade secret right or other proprietary right of others, and to the knowledge of the Company and the Bank, none of the Company, the Bank or the Bank Subsidiary has committed any such violation or infringement.  To the knowledge of the Company or the Bank, (i) there are no facts or circumstances that, upon consummation of the transactions contemplated hereby, would cause the Surviving Company, the Company, the Bank or the Bank Subsidiary, as applicable, to be in any way more restricted in its use of any of the Intellectual Property than it was on the date hereof under any contract to which the Company, the Bank or the Bank Subsidiary is a party or by which it is bound, or thatand (ii) the use of such Intellectual Property by the Surviving Company, the Company, the Bank or the Bank Subsidiary will not, as a result of such consummation, violate or infringe the rights of any Person, or subject Wintrust, the Surviving Company, the Company, the Bank or the Bank Subsidiary to liability of any kind, under any such contract.

(c)                                  The Company, the Bank or the Bank Subsidiary has ownership of, or such other rights by license, lease or other agreement in and to, the IT Assets as is necessary to permit the Company, the Bank and the Bank Subsidiary to use the IT Assets in the conduct of their respective businesses as presently conducted.  The IT Assets operate and perform in all material respects in accordance with their documentation and functional specifications and otherwise as required by the Company, the Bank and the Bank Subsidiary in connection with their respective businesses, and have not materially malfunctioned or failed within the past three (3) years.  “IT Assets” means the computers, computer software, firmware, servers, workstations, routers, hubs, switches, data communications lines and all other information technology equipment, and all associated documentation, owned or leased by the Company, the Bank or the Bank Subsidiary.  To the knowledge of the Company, the Bank and the Bank Subsidiary, the IT Assets do not contain any worms, viruses, bugs, faults or other devices or effects that (i) enable or assist any Person to access without authorization the IT Assets, or (ii) otherwise significantly adversely affect the functionality of the IT Assets, except as disclosed in its documentation.  To the knowledge of the Company, the Bank and the Bank Subsidiary, no Person has gained unauthorized access to the IT Assets.  The Company, the Bank and the Bank Subsidiary have implemented reasonable back-up and disaster recovery technology consistent with industry practices.  To the knowledge of the Company, the Bank and the Bank Subsidiary, except for “off the shelf” software licensed by the Company, the Bank or the Bank Subsidiary in the Ordinary Course of Business, none of the IT Assets contains any shareware, open source code, or other software the use of which requires disclosure or licensing of any intellectual property.

2.23Absence of Certain Changes or EventsEvents.  . Other than as specifically disclosed in this Agreement, the Financial Statements, or the Schedules delivered pursuant to this Agreement, there has not occurred (i) since the Audited Balance Sheet Date, any material adverse change in the financial condition, assets, liabilities, business or results of operations of the Company or any of the Bank or the Bank Subsidiary,Company Subsidiaries, and no fact or condition exists or is contemplated or threatened which might reasonably be expected to cause such a change in the future, or (ii) any changes or condition, event, circumstance, fact or other occurrence, whether occurring before or since the Audited Balance Sheet Date that may reasonably be expected to have or result in a material adverse change in the financial condition, assets, liabilities, business or results of operations of the Company or any of the Bank or the Bank Subsidiary.Company Subsidiaries.  No fact or condition exists with respect to the business, operations or assets of the Company or any of the Bank or the Bank SubsidiaryCompany Subsidiaries which the Company has reason to believe may cause the Federal Reserve Application, the Wisconsin Application or any other regulatory approval referenced in this Agreement to be denied or unduly delayed.

2.24Conduct of Business Since Audited Balance Sheet DateDate..Except as set forth onSchedule 2.24, since the Audited Balance Sheet Date the business of the Company and each of the Bank and the Bank SubsidiaryCompany Subsidiaries has been conducted only in the Ordinary Course of Business.  Without limiting the generality of the foregoing, since the Audited Balance Sheet Date, except as set forth on such Schedule,

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none of the Company the Bank or the Bank SubsidiaryCompany Subsidiaries has taken, or has caused, suffered or permitted to be taken any of the following actions:

(a)                                 sold, leased (as lessor), transferred or otherwise disposed of (including any transfers to any of its affiliates), or mortgaged or pledged, or imposed or suffered to be imposed any Encumbrance on, any assets of the Company’s, the Bank’sCompany or the Bank Subsidiary’s assetsCompany Subsidiaries reflected on the Audited Financial Statements or any assets acquired by the Company or any of the Bank or the Bank SubsidiaryCompany Subsidiaries after the Audited Balance Sheet Date, except for (i) OREO and loans held for sale and Investment Securities sold or otherwise disposed of in the Ordinary Course of Business, and (ii) Permitted Encumbrances;Encumbrances, and (iii) real estate loans pledged in the Ordinary Course of Business as collateral for Federal Home Loan Bank advances;

(b)                                 cancelled any debts owed to or claims held by the Company or any of the Bank or the Bank SubsidiaryCompany Subsidiaries (including the settlement of any claims or litigation) other than in the Ordinary Course of Business;

(c)                                  created, incurred or assumed, or agreed to create, incur or assume, any indebtedness for borrowed money in respect of the Company or any of the Bank or the Bank Subsidiary,Company Subsidiaries, or entered into, as lessee, any capitalized lease obligations (as defined in Accounting Standards Codification Topic 840), in either case other than in the Ordinary Course of Business;

(d)                                 accelerated or delayed collection of notes, accounts or loans receivable generated by the Company or any of the Bank or the Bank SubsidiaryCompany Subsidiaries in advance of or beyond their regular due dates or the dates when the same would have been collected in the Ordinary Course of Business;

(e)                                  delayed or accelerated payment of any account payable or other liability of the Company or any of the Bank or the Bank SubsidiaryCompany Subsidiaries beyond or in advance of its due date or the date when such liability would have been paid in the Ordinary Course of Business;

(f)                                   declared or paid any dividend on shares of Company Common Stock or made any other distribution with respect thereto;

(g)                                  instituted any increase in any compensation payable to any employee of the Company or the Bank other than routine increases in the Ordinary Course of Business, or instituted any increase in any profit-sharing, bonus, incentive, deferred compensation, insurance, pension, retirement, medical, hospital, disability, welfare or other benefits made available to employees of the Company or the Bank;Bank, other than increases in the Ordinary Course of Business;

(h)                                 prepared or filed any Tax Return inconsistent with past practice or, on any such Tax Return, taken any position, made any election, or adopted any method that is inconsistent with positions taken, elections made or methods used in preparing or filing similar Tax Returns in prior periods); or

(i)                                     made any change in the accounting principles and practices used by the Company the Bank or the Bank SubsidiaryCompany Subsidiaries from those applied in the preparation of the Audited Financial Statements and the related statements of income and cash flow for the period then ended.

2.25Change in Business Relationships.  None of the Company the Bank or the Bank SubsidiaryCompany Subsidiaries has received notice (whether written or, to the knowledge of the Company and the Bank, oral), whether on account of the transactions contemplated by this Agreement or otherwise, (a) that any customer, agent, representative, supplier, vendor or business referral source of the Company the Bank or any of the Bank Subsidiary

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Company Subsidiaries intends to discontinue, diminish or change its relationship with the Company or any of the Bank or the Bank Subsidiary,Company Subsidiaries, the effect of which would be material to the business, assets or operations of the Company or any of the Bank or the Bank Subsidiary,Company Subsidiaries, or (b) that any executive officer of the Company or the Bank intends to terminate or substantially alter the terms of his or her employment.  There have been no complaints or disputes (in each case set forth in writing) with any customer, employee, agent, representative, supplier, vendor, business referral source or other parties that have not been resolved which are reasonably likely to be material to the business, assets or operations of the Company or any of the Bank or the Bank Subsidiary.Company Subsidiaries.

2.26Brokers’ and Finders’ FeesFees..Except as set forth inSchedule 2.26, none of the Company the Bank or the Bank SubsidiaryCompany Subsidiaries has any liability (whether incurred, potential, contingent or otherwise) for brokerage commissions, finders’ fees, or like compensation with respect to the transactions contemplated by this Agreement.

2.27Section 280G PaymentsPayments..Except as set forth onSchedule 2.22, neither  Neither the execution of this Agreement nor the consummation of the transactions contemplated hereby will result in any payment that would be deemed an “excess parachute payment” under Section 280G of the Code.

2.28Information Supplied.  None of the information supplied or to be supplied by the Company for inclusion or incorporation by reference in (i) the Registration Statement (as defined in Section 4.4(b) below) to be filed with the Securities Exchange Commission (the “Commission” ) by Wintrust in connection with the transactions contemplated by this Agreement will, at the time the Registration Statement is filed with the Commission, at any time it is amended or supplemented or at the time it becomes effective under the Securities Act, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading, or (ii) the Proxy Statement (as defined below) will, at the date it is first mailed to the Company’s shareholders or at the time of the Shareholders’ Meeting, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they are made, not misleading.  The Proxy Statement will comply as to form in all material respects with the requirements of the Exchange Act and the rules and regulations thereunder, except that no representation is made by the Company with respect to statements made or incorporated by reference therein based on information supplied by Wintrust or Merger Co. in writing for inclusion or incorporation by reference in the Proxy Statement.

2.29Opinion of Financial Advisor.  The Company has received the opinion of D.A. Davidson & Co., dated the date of this Agreement, to the effect that, as of such date, the consideration to be received in the Merger by the holders of Company Common Stock is fair to such holders from a financial point of view, a signed copy of which opinion has been delivered to Wintrust.

2.30No OmissionsOmissions..  None of the representations and warranties contained in Article III, in the Schedules provided for herein by the Company is false or misleading in any material respect or omits to state a fact herein or therein necessary to make such statements not misleading in any material respect.

ARTICLE III

REPRESENTATIONS AND WARRANTIES


CONCERNING WINTRUST AND MERGER CO.

Except as set forth in the specific Schedule relating to a specific and corresponding Section below, Wintrust and Merger Co. hereby jointly and severally represent and warrant to the Company as of the date

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hereof and as of the Closing Date (except to the extent made only as of a specified date, in which case as of such date) as follows:

3.1Organization.

3.1Organization.

(a)                                 Wintrust is duly registered as a financial holding company under the BHCA, is a corporation duly organized, validly existing and in good standing under the laws of the State of Illinois, has the corporate power and authority to own its own properties and to carry on its business as it is now being conducted, and is duly qualified and in good standing as a foreign corporation in each jurisdiction where the location and character of its properties and the business conducted by it require such qualification, except where the failure to be so qualified would not have a Material Adverse Effect on Wintrust.

(b)                                 Merger Co. is a corporationlimited liability company duly organized, validly existing and in good standing under the laws of the State of WisconsinIllinois and has the corporatelimited liability company power and authority to enter into this Agreement and to consummate the transactions contemplated hereby.  Merger Co. has conducted no business other than in connection with the execution and delivery of this Agreement.

3.2Capitalization.

3.2Capitalization.

(a) The                                 Except as set forth on Schedule 3.2(a), the authorized capital stock of Wintrust consists of (i) 100,000,000 shares of common stock, no par value per share, of which 46,626,772 shares were issuedis as of June 30, 2014, (ii) 20,000,000 shares of preferred stock, no par value per share, $1,000 liquidation value per share, of which 126,467 shares are issued and outstanding, and (iii) 73,867 shares are heldset forth in treasury.the Wintrust SEC Documents (as defined in Section 3.5(a)).  The issued and outstanding shares of Wintrust Common Stock have been duly and validly authorized and issued and are fully paid and non-assessable.  The Wintrust Common Stock is subject to certain preferences, qualifications, limitations, restrictions or special or relative rights under Wintrust’s articles of incorporation, a true and complete copy of which has been previously provided to the Company. Except as disclosed onSchedule 3.2, thereThere are no options, agreements, contracts or other rights in existence to purchase or acquire from Wintrust any shares of capital stock of Wintrust whether now or hereafter authorized or issued, other than shares issuable pursuant to employee benefit or compensationreserved under any equity incentive plans referred toin excess of the amounts reflected in the Wintrust SEC Documents.

(b)                                 The authorized capital stocklimited liability company interests of Merger Co. consistsconsist of 1,000 shares of common stock, no par value per share,units, all of which are issued and outstanding and owned by Wintrust. The issued and outstanding shares of common stock of Merger Co. have been duly authorized and issued by Merger Co. and are fully paid and non-assessable and owned by Wintrust.

3.3Authorization; No Violations.Violations.  The execution and delivery of this Agreement by Wintrust and Merger Co. and the performance of Wintrust’s and Merger Co.’s obligations hereunder have been duly and validly authorized by the Boards of Directors of Wintrust and Merger Co. and by Wintrust as the sole shareholder of Merger Co., do not violate or conflict with the articles of incorporation or by-lawsbylaws of Wintrust, the articles of incorporationorganization or by-lawsoperating agreement of Merger Co., the Illinois Business CorporationsLLC Act the WBCL or any applicable law, court order or decree to which Wintrust or Merger Co. is a party or subject, or by which Wintrust or Merger Co. is bound, and require no further corporate or shareholder approval on the part of Wintrust or Merger Co.  Subject to receipt of the consents or approvals set forth onSchedule 3.4, the execution and delivery of this Agreement by Wintrust and Merger Co. and the performance of Wintrust’s and Merger Co.’s obligations hereunder do not and will not result in any default or give rise to any right of termination, cancellation or acceleration under any material note, bond, mortgage, indenture or other agreement by which Wintrust or Merger Co. is bound.  This Agreement, when executed and delivered by the Parties, and subject to the matters described in Section 3.4, will be a valid, binding and enforceable obligation of each of Wintrust and Merger Co., subject to applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors generally and to general principles of equity.

3.4Consents and ApprovalsApprovals..No consents or approvals of, or filings or registrations with, any Governmental Authority or with any third party are necessary in connection with the execution and delivery by Wintrust or Merger Co. of this Agreement and the consummation by Wintrust and

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Merger Co., as of the Effective Date, of the transactions contemplated by this Agreement, except for (a) the consents and approvals set forth onSchedule 3.4, (b) the filing by Wintrust of an application with the Applications,Board of Governors of the Federal Reserve System (the “Federal Reserve”) under the BHCA (the “Federal Reserve Application”) and related approval, (c) the filing by Wintrust of the Registration Statement (as defined in Section 4.4(b)),  and (d) the filing of the Articles of Merger with WDFIthe IL SOS under the WBCL.

Illinois LLC Act and the IBCA.

3.5Wintrust SEC Filings and Financial Statements.Statements.

(a)                                 Since January 1, 2013,2018, Wintrust has timely filed all registration statements and other material reports and documents (including any amendments thereto) required to be filed with the Securities and Exchange Commission (the “Commission”) under the Securities Act and the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and the rules and regulations of the Commission except where the failure to file would not, either individually or in the aggregate, have a Material Adverse Effect on Wintrust (the “Wintrust SEC Documents”), and all such Wintrust SEC Documents have complied in all material respects, as of their respective filing dates and effective dates, and the date of the most recent amendment thereto, as the case may be, with all applicable requirements of the Securities Act or the Exchange Act.  As of their respective filing and effective dates, and the date of the most recent amendment thereto, none of the Wintrust SEC Documents contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.

(b)                                 The audited consolidated financial statements contained or incorporated by reference in Wintrust’s Annual Report on Form 10-K for the year ended December 31, 20132018 and the unaudited interim financial statements included in Wintrust’s most recent Quarterly Reports on Form 10-Q have been prepared in conformity with GAAP applied on a consistent basis, and, together with the notes thereto, present fairly the consolidated financial position of Wintrust and its subsidiaries at the dates shown and the consolidated results of their operations, changes in shareholders’ equity and cash flows for the periods then ended.  The interim financial statements as of, and for, the periods ending after December 31, 20132018 included in Wintrust’s Quarterly Reports on Form 10-Q, as filed with the Commission, include all adjustments necessary for a fair presentation of the financial position of Wintrust and its subsidiaries and the results of their operations for the interim periods presented, subject to normal, recurring year-end adjustments and the omission of footnote disclosure.

(c)                                  The allowance for loan losses shown on each of the balance sheets contained in the Wintrust SEC Documents are adequate in the judgment of management and consistent with applicable regulatory standards and under GAAP to provide for losses, net of recoveries relating to loans previously charged off, on loans outstanding (including accrued interest receivable) as of the applicable date of such balance sheet.

3.6Compliance with Laws; Legal Proceedings.

(a)                                 Wintrust and its subsidiaries are each in compliance with all applicable federal, state, county and municipal laws and regulations (i) that regulate or are concerned in any way with the ownership and operation of banks or the business of banking, their holding companies and their subsidiaries or of acting as a fiduciary, including those laws and regulations relating to the investment of funds, the taking of deposits, the lending of money, the collection of interest, the extension of credit and the location and operation of banking facilities, or (ii) that otherwise relate to or affect the business or assets of Wintrust or any of its subsidiaries or the assets owned, used, occupied or managed by Wintrust or any of its subsidiaries, except for such noncompliance which individually or in the aggregate would not have a Material Adverse Effect on Wintrust.  Wintrust and its subsidiaries (direct and indirect) hold all material licenses, certificates, permits, franchises and rights from all appropriate federal, state or other

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Governmental Authorities necessary for the conduct of their respective businesses and the ownership of their respective assets.

(b)                                 Except as may be disclosed in the Wintrust SEC Documents, there are no material claims, actions, suits or proceedings pending or, to the knowledge of Wintrust, threatened or contemplated against or affecting Wintrust or its subsidiaries, at law or in equity, or before any federal, state or other Governmental Authority or any arbitrator or arbitration panel, whether by contract or otherwise, including any claims, actions, suits or proceedings that might seek to challenge the validity or propriety of the Merger, and there is no decree, judgment or order or supervisory agreement of any kind in existence against or restraining Wintrust or its subsidiaries from taking any action of any kind in connection with their respective businesses.  Except as may be disclosed in the Wintrust SEC Documents, none of Wintrust or its subsidiaries has received from any federal, state or other Governmental Authority any notice or threat (whether written or, to the knowledge of Wintrust, oral) of any enforcement action, criticism or recommendation concerning capital, compliance with laws or regulations, safety or soundness, fiduciary duties or other banking or business practices that has not been resolved to the reasonable satisfaction of such Governmental Authority and that would be materially adverse to Wintrust and its subsidiaries taken as a whole, and Wintrust has no reasonable basis to believe that any such enforcement action, criticism or recommendation not otherwise disclosed herein is contemplated.

3.7Wintrust Regulatory ReportsReports..Since January 1, 2013,2018, Wintrust and its subsidiaries have filed all material reports, registrations and statements, together with any amendments required to be made with respect thereto, required to be filed with the Federal Reserve, the FDIC, the Illinois Department of Financial and Professional Regulation,OCC, the OCCIDFPR and any other Governmental Authority or self-regulatory organization with jurisdiction over any of the activities of Wintrust or its subsidiaries (the “Wintrust Regulatory Reports”), and have paid all fees and assessments due and payable in connection therewith.  As of their respective dates, the Wintrust Regulatory Reports complied in all material respects with the statutes, rules and regulations enforced or promulgated by the applicable regulatory authority with which they were filed and did not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading.

3.8No Adverse ChangeChange..  Except as disclosed in the Wintrust SEC Documents or this Agreement, there has not occurred (a) since December 31, 2013,2018, any Material Adverse Effect on Wintrust, or (b) any change, condition, event, circumstance, fact or other occurrence, whether occurring before or since December 31, 20132018 that may reasonably be expected to have or result in a Material Adverse Effect on Wintrust.  No fact or condition exists with respect to the business, operations or assets of Wintrust or its subsidiaries which Wintrust has reason to believe may cause the Federal Reserve Application the Wisconsin Application or any of the other regulatory approvals referenced in Section 6.3 or 7.3 to be denied or unduly delayed.

3.9Brokers’ and Finders’ Fees.  Neither Wintrust nor Merger Co. has incurred any liability for brokerage commissions, finders’ fees, or like compensation with respect to the transactions contemplated by this Agreement.

3.10Taxation of the Merger.  Neither Wintrust nor any subsidiary of Wintrust has taken any action or agreed to take any action that would preclude the Merger from qualifying as a reorganization in accordance with Section 368(a) of the Code and, to the knowledge of Wintrust, there are no agreements or arrangements to which Wintrust or any subsidiary of Wintrust is a party that would prevent the Merger from so qualifying.

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3.11Information Supplied.  None of the information supplied or to be supplied by Wintrust or Merger Co. for inclusion or incorporation by reference in (i) the Registration Statement will, at the time the Registration Statement is filed with the Commission, at any time it is amended or supplemented or at the time it becomes effective under the Securities Act, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading, or (ii) the Proxy Statement will, at the date it is first mailed to the Company’s shareholders or at the time of the Shareholders’ Meeting, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they are made, not misleading.  The Registration Statement will comply as to form in all material respects with the requirements of the Securities Act and the rules and regulations thereunder, except that no representation is made by Wintrust or Merger Co. with respect to statements made or incorporated by reference therein based on information supplied by the Company for inclusion or incorporation by reference therein.

3.12No OmissionsOmissions..  None of the representations and warranties contained in ARTICLE III or in the Schedules provided for herein is false or misleading in any material respect or omits to state a fact herein necessary to make such statements not misleading in any material respect.

ARTICLE IV


AGREEMENTS AND COVENANTS

4.1Conduct of BusinessAs required in Section 6.2, as a condition precedent to the obligations of Wintrust and Merger Co., the Company shall certify as to the fulfillment of the Company’s agreement that duringDuring the period commencing on the date hereof and continuing until the Effective Time, the Company shall conduct the its business and shall cause the Bank and the Bank SubsidiaryCompany Subsidiaries to conduct their respective businesses in the Ordinary Course of Business consistent with soundprudent banking practice.  Without limiting the generality of the foregoing, but subject to the next sentence, the Company shall comply with the express covenants of this Section 4.1 set forth below, and as a condition precedent to the obligations of Wintrust and Merger Co., shall certify as to the fulfillment of such covenants in accordance with Section 6.2(a).

It is the intent of the Parties that neither Wintrust nor Merger Co., by reason of this Agreement, including the express covenants in this Section 4.1, until such time as the Parties consummate the Merger and other transactions contemplated by this Agreement in accordance with its terms, shall be deemed to control, directly or indirectly, the Company or the Company Subsidiaries.  Accordingly, neither Wintrust nor Merger Co. shall use or attempt to use their rights under these covenants to exercise control (as defined by Section 2(a)(2) of the BHCA) over the management and policies of the Company or the Company Subsidiaries.

In furtherance of the foregoing, without the prior written consent of Wintrust which(which consent shall not be unreasonably withheld, delayed or conditioned:conditioned):

(a)                                 no change shall be made in the articles of incorporation or by-lawsbylaws of the Company, or the Bank Subsidiary, or the charter or by-lawsbylaws of the Bank;Bank, and the articles of organization or operating agreement of the Bank Subsidiary;

(b)                                 except with respect to the exercise of any Outstanding Company Option, no change shall be made in the capitalization of the Company (including the granting of any additional options under the Company Option Plan),Plans) or any of the Bank or the Bank Subsidiary,Company Subsidiaries, or in the number of issued and outstanding shares of Company Common Stock;

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(c)                                  the compensation of officers or key employees of the Company or the Bank shall not be increased nor any bonuses paid except in the Ordinary Course of Business, and except for accrued amounts of bonuses (in amounts consistent with past bonuses paid in the Ordinary Course of Business) to be paid prior to Closing; other than as contemplated by the foregoing there are no changes to compensation or bonuses anticipated to be made during the next six (6) monthsmonths;

(d)                                 except the Bank intends to increase year-end bonuses to certain of its employees and its directors as set forth onSchedule 4.1(c) which expenses shall be accruedfor Loans that have already been approved by the Bank and shownfor which commitments have been issued and accepted and where such commitments are listed on the balance sheets for the Bank as of the Closing Date delivered to Wintrust pursuant to Section 6.10(a);

(d)Schedule 4.1(d), no Loan, or renewal or restructuring of a Loan,

(i) in the amount of $500,000$1,000,000 or more (including Loans to any one borrower or related group of borrowers which, in the aggregate, equal or exceed $500,000)$1,000,000) shall be made by the Bank except after delivering to Wintrust written notice, including a complete loan package for such Loan, renewal or restructuring, in a form consistent with the Bank’s policies and practice, at least five (5) business days prior to such Loan, renewal or restructuring, and such Loan or renewal or restructuring of a Loan shall be made in the Ordinary Course of Business consistent with soundprudent banking practices, the Bank’s current loan policies and applicable rules and regulations or applicable Governmental Authorities with respect to amount, term, security and quality of such borrower or borrower’s credit; and

(ii)provided, however, that the Bank shall be allowed to renew performing Loans in the amountamounts of $1,000,000 or more (includingless without notice to Wintrust, but shall not renew performing Loans to any one borrower or related groupin amounts of borrowers which, in the aggregate, equal or exceed $1,000,000) shall be made by the Bankgreater than $1,000,000 except after delivering to Wintrust written notice, including a complete loan package for such Loan, renewal, or restructuring, in a form consistent with the Bank’s policies and practice, and obtaining Wintrust’s prior consent, which consent shall not be unreasonably withheld or delayed and shall be deemed given if Wintrust shall have not responded to the Company’s request within two (2)at least five (5) business days after receipt ofprior to such complete loan package, and such Loan or renewal or restructuring of a Loan shall be made in the Ordinary Course of Business consistent with sound banking practices, the Bank’s current loan policies and applicable rules and regulations of applicable Governmental Authorities with respect to amount, term, security and quality of such borrower or borrower’s credit;renewal;

(e) no dividends or other distributions shall be declared or paid by the Company;

(f)(e)                                  the Company and each of the Bank and the Bank SubsidiaryCompany Subsidiaries shall use their commercially reasonable efforts to maintain their present insurance coverage in respect of their properties and businesses;

(g)

(f)                                   no significant changes shall be made in the general nature of the business conducted by the Company the Bank and the Bank Subsidiary;Company Subsidiaries;

(h)

(g)                                  except as contemplated pursuant to Section 6.8,6.7, no employment, consulting or similar agreements shall be entered into by the Company or any of the Bank or the Bank SubsidiaryCompany Subsidiaries that are not terminable by the Company the Bank or the Bank Subsidiary,Company Subsidiaries, as applicable, on 30 days’ or fewer notice without penalty or obligation, nor shall the Company or the Bank terminate the employment of any officer thereof without first notifying Wintrust;

(i)

(h)                                 except as expressly provided in this Agreement, neither the Company nor the Bank shall take any action that would result in a termination, partial termination, curtailment, discontinuance of a Benefit Plan or merger of any Benefit Plan into another plan or trust;

(j)

(i)                                     the Company the Bank and the Bank Subsidiary,Company Subsidiaries, as applicable, shall file all Tax Returns in a timely manner shall not make any application for or consent to any extension of time for filing any Tax Return or any extension of the period of limitations applicable thereto and shall not change any of its accounting methods for federal and state income tax purposes;

(k)

(j)                                    none of the Company the Bank or the Bank SubsidiaryCompany Subsidiaries shall make any expenditure for fixed assets in excess of $100,000 for any single item, or $250,000$500,000 in the aggregate, or shall enter into leases of fixed assets having an annual rental in excess of $100,000;

(l)

(k)                                 none of the Company the Bank or the Bank SubsidiaryCompany Subsidiaries shall incur any liabilities or obligations, make any commitments or disbursements, acquire or dispose of any property or asset, make any contract or agreement, or engage in any transaction except in the Ordinary Course of

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Business consistent with soundprudent banking practices and the Company’s,current policies of the Bank’sCompany and the Bank Subsidiary’s current policies;

Company Subsidiaries;

(m)(l)                                     none of the Company the Bank or the Bank SubsidiaryCompany Subsidiaries shall fail to do anything that will cause a breach by the Company or any of the Bank or the Bank SubsidiaryCompany Subsidiaries of, or default by the Company or any of the Bank or the Bank SubsidiaryCompany Subsidiaries under, any Material Contract;

(n)

(m)                             the Bank shall not engage or agree to engage in any “covered transaction” within the meaning of Sections 23A or 23B of the Federal Reserve Act (without regard to the applicability of any exemptions contained in Section 23A) or any transaction of the kind referred to in Section 3.12, unless the Bank has complied with Sections 23A and 23B of the Federal Reserve Act;

(o)

(n)                                 the Bank shall only purchase or invest in obligations of the government of the United States or agencies of the United States or state or local governments having maturities of not more than five (5) years and which municipal obligations have been assigned a rating of A or better by Moody’s Investors Service or by Standard and Poor’s;

(p)

(o)                                 the Bank shall not (i) accept or renew any brokered deposits, except pursuant to CDARS and ICS programs, or (ii) incur any additional Federal Home Loan Bank advances or other types of ordinary course wholesale funding (except for Federal funds purchased); and

(q)

(p)                                 no changes of a material nature shall be made in any of the Company’s the Bank’s or the Bank Subsidiary’sCompany Subsidiaries’ accounting procedures, methods, policies or practices or the manners in which the Company or the Bank and the Bank SubsidiaryCompany Subsidiaries maintain their respective records.

4.2Access to Information and PremisesPremises..

(a)                                 The Company shall provide Wintrust and its representatives fullreasonable access, during normal business hours and on reasonable advance notice to the Company, the Bank and the Bank Subsidiary, to further information regarding the Company, the Bank and the Bank Subsidiary (to the extent permissible under applicable law)law and except for information subject to attorney-client privilege) and the Company’s the Bank’s and the Bank Subsidiary’sBank’s premises for purposes of (i) observing the Company’s the Bank’s and the Bank Subsidiary’sCompany Subsidiaries’ business activities and operations and to consult with their officers and employees regarding the same on an ongoing basis to verify compliance by the Company the Bank and the Bank SubsidiaryCompany Subsidiaries with all terms of this Agreement, and (ii) making all necessary preparations for conversion of the Bank’s IT systems;provided,however, that the foregoing actions shall not unduly interfere with the business operations of the Company the Bank or the Bank Subsidiary.Company Subsidiaries.

(b)                                 Wintrust will use suchthe information as is provided to it by the Company and the Bank or the Bank Subsidiary,Company Subsidiaries, or representatives thereof, pursuant to this Agreement, solely for the purpose of conducting business, legal and financial reviews of the Company the Bank and the Bank SubsidiaryCompany Subsidiaries and for such other purposes as may be related to this Agreement, and Wintrust will, and will direct all of its agents, employees and advisors to, maintain the confidentiality of all such information in accordance with the terms of the letter agreement regarding confidentiality entered into by and between the Company and Wintrust dated MayDecember 19, 20142018 (the “Confidentiality Agreement”).

4.3Board Notices and MinutesMinutes..  The Company shall give reasonable notice to Wintrust of all meetings of the Company Board, the Bank Board, andor the managers of the Bank Subsidiary, Board, and any of their respective committees, and if known, the agenda for or business to be discussed at such meetings, except (a) to the extent objected to by state or federal bank regulatory agencies, (b) prohibited by law or in connection with any lawfully invoked privilege, or(c) to the extent the Boarddisclosure could result in a waiver of Directorsthe Company’s or the Bank’s attorney-client privilege, or (d) to the extent the respective

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boards will be discussing this Agreement, or the transactions contemplated under this Agreement.Agreement or a Company Takeover Proposal.  In the event of any such objection by state or federal banking authorities, the Company shall promptly notify Wintrust and its counsel, without identifying the specific matter that was the subject of the objection.  To the extent permissible under law and unless otherwise provided above, the Company shall promptly transmit to Wintrust copies of all notices, minutes, consents and other materials that the Company, the Bank and the Bank Subsidiary provide to their respective directors.directors, trustees or managers, except for information subject to attorney-client privilege.  Wintrust agrees to hold in confidence all such information pursuant to the Confidentiality Agreement.

4.4Regulatory Filings of WintrustWintrust..

(a)                                 Within 20 days following execution and delivery of this Agreement, Wintrust will file the ApplicationsFederal Reserve Application and take all other appropriate actions necessary to obtain the regulatory approvals referred to in Sections 6.3 and 7.3 hereof (other than those to be obtained from the Commission, which are the subject of Section 4.4(b)), and the Company and the Bank will use all reasonable and diligent efforts to assist in obtaining all such approvals.  The obligation of Wintrust to take all appropriate actions shall not be construed as including an obligation to accept any terms of or conditions to a consent, authorization, order, or approval of, or any exemption by, any Governmental Authority or other party that are not acceptable to Wintrust, in its sole reasonable discretion, or to change the business practices of Wintrust or any of its subsidiaries in a manner not acceptable to Wintrust, in its sole reasonable discretion.  In advance of filing any application for such regulatory approval, Wintrust shall provide the Company and its counsel with a copy of such application (but excluding any information contained therein regarding Wintrust and its business or operations for which confidential treatment has been requested) and provide an opportunity to comment thereon, and thereafter shall promptly advise the Company and its counsel of any material communication received by Wintrust or its counsel from any regulatory authorityGovernmental Authority with respect to such application.

(b)                                 Wintrust shall file with the SECCommission within 30 days after the execution of this Agreement or as soon as practicable thereafter, a registration statement on an appropriate formForm S-4 under the Securities Act covering Wintrust Common Stock to be issued pursuant to the Merger and shall use its reasonable and diligent efforts to cause the same to become effective and thereafter, until the Effective Time or termination of this Agreement, to keep the same effective and, if necessary, amend and supplement the same. Such registration statement and any amendments and supplements thereto are referred to herein as the (“Registration Statement”).  Company shall provide to Wintrust written notice, within 5 days, of the occurrence of any event requiring or possibly requiring an amendment or supplement to the Registration Statement, and cooperate in the preparation, filing and dissemination to Shareholders of any such amendment or supplement. The Registration Statement shall include a proxy statement/prospectus (the “Proxy Statement”) acceptable to Wintrust and the Company, prepared by Wintrust and the Company for use in connection with the Shareholders’ Meeting, all in accordance with the rules and regulations of the SEC,Commission, it being understood that Wintrust shall have final approval authority with respect to the content of the proxy statement/prospectus.Proxy Statement.  The Company shall provide to Wintrust prompt written notice, within one business day, of the occurrence of any event requiring or possibly requiring an amendment or supplement to the Registration Statement or the Proxy Statement, and cooperate in the preparation, filing and dissemination to shareholders of any such amendment or supplement.

(c)                                  Each of the parties shall use all reasonable and diligent efforts to respond as promptly as practicable to any comments of the Commission with respect to the Registration Statement and the Proxy Statement.  The Company shall use all reasonable and diligent efforts to cause the Proxy Statement to be mailed to the Company’s shareholders as promptly as practicable after the Registration Statement is declared effective under the Securities Act.  The parties shall notify each other promptly of the receipt of any comments from the Commission or its staff and of any request by the Commission or its staff for amendments or supplements to the Proxy Statement or the Registration Statement or for additional information and shall supply each other with copies of all correspondence between such party

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or any of its Representatives, on the one hand, and the Commission or its staff, on the other hand, with respect to the Proxy Statement, the Registration Statement or the Merger.  Each party shall give each other party an opportunity to participate in any discussions or meetings such party has with the Commission in connection with the Proxy Statement, the Registration Statement or the Merger.

(d)                                 Notwithstanding anything in the foregoing clauses (b) and (c) of this Section 4.4 to the contrary, before filing the Registration Statement (or any amendment or supplement thereto) or mailing the Proxy Statement (or any amendment or supplement thereto) or responding to any comments of the Commission with respect thereto, each of Wintrust and the Company (i) shall provide the other a reasonable opportunity to review and comment on such document or response (including the proposed final version of such document or response), (ii) shall include in such document or response all comments reasonably proposed by the other and (iii) shall not file or mail such document or respond to the Commission prior to receiving the approval of the other (such approval not to be unreasonably withheld, conditioned or delayed).  Each of Wintrust and the Company shall advise the other, promptly after receipt of notice thereof, of the time of effectiveness of the Registration Statement, the issuance of any stop order relating thereto or the suspension of the qualification of the Wintrust Common Stock included in the Merger Consideration for offering or sale in any jurisdiction, and each of Wintrust and the Company shall use all reasonable efforts to have any such stop order or suspension lifted, reversed or otherwise terminated.  Wintrust shall, as soon as practicable after the execution of this Agreement, make all filings, if any, required to obtain all blue sky permits, authorizations, consents or approvals required for the issuance of Wintrust Common Stock. In advance of the filing of the Registration Statement,Stock; provided that Wintrust shall provide the Company and its counsel withnot have an opportunityobligation to comment thereon, and thereafter shall promptly advise the Company and its counsel ofqualify to do business in any material communication received by Wintrust or its counsel from the SEC with respect to the Registration Statement. None of the information furnished by Wintrust or the Company for inclusion in the Registration Statement, the proxy statement/prospectus included therein or any other document filed with the SEC or any state securities commission, at the respective times at which such documents are filed with the SEC or such state securities commission or, in the case of the Registration Statement, when it becomes effective or, in the case of the proxy statement/prospectus contained therein, when mailed or at the time of the Shareholders’ Meeting, shall be false or misleading with respect to any material fact or shall omit to state any material fact necessary in order to make the statements therein, in light of the circumstancesjurisdiction in which they were made,it is not misleading.already qualified.

4.5Meeting of Shareholders of the CompanyCompany..As soon as practicable following the effectiveness of the Registration Statement, the Company shall duly call, give notice of, convene and hold a meeting of its shareholders for the purpose of voting upon this Agreement, the Merger and the transactions contemplated hereby including the appointment of a Shareholders’ Agent (as defined and further described in Section 8.4), in accordance with the Company’s articles of incorporation, its by-laws and the WBCL (the “Shareholders’ Meeting”).  TheWithout limiting the generality of the foregoing, the Company agrees that its obligations pursuant to the first sentence of this Section 4.5 shall throughnot be affected by (i) the commencement, public proposal, public disclosure or communication to the Company of any Company Takeover Proposal or (ii) the withdrawal by the Company Board recommend toof its shareholders, subject to its fiduciary duties, approval or recommendation of this Agreement or the Merger and the transactions contemplated hereby.Merger.

4.6Business Relations and PublicityPublicity..  The Company and each of the Bank and the Bank SubsidiaryCompany Subsidiaries shall use reasonable and diligent efforts to preserve the reputation and relationship of the Company the Bank and the Bank SubsidiaryCompany Subsidiaries with suppliers, clients, customers, employees, and others having business relations with the Company the Bank and the Bank Subsidiary.Company Subsidiaries.  Wintrust and the Company shall coordinate all publicity relating to the transactions contemplated by this Agreement and, except as otherwise required by applicable law or the rules of the Nasdaq Global Select Market or with respect to employee meetings,(“NASDAQ”), no Party shall issue any press release, publicity statement or other public notice or communication, whether written or oral, relating to this Agreement or any of the transactions contemplated hereby without obtaining the prior consent of the other Parties, which consent

shall not be unreasonably withheld, conditioned or delayed.  The Company shall obtain the prior consent (which shall not be unreasonably withheld, conditioned or delayed) of Wintrust to the content of any communication to the Company’s shareholders.

4.7Covenants Regarding Real Property.

(a)Title Commitments and Endorsements.                                 The Company shall deliverhas delivered to Wintrust, at the Company’sWintrust’s sole expense, with respect to each parcel of theBank Owned Real Property, consisting of OREO property listed onSchedule 4.7(a), no later than thirty (30) days after the date hereof, a commitment for an owner’s title insurance policy, ALTA Policy Form 2006 if available (if not available, then Form B-1992) (collectively, the(theTitle Commitments”), having an effective date as near as feasible to the date of delivery of suchMay 9, 2019 and May 10, 2019, respectively, from Chicago Title Commitments, from a title insurance company designated by theInsurance Company and reasonably satisfactory to Wintrust (the “Title Insurer”). Wintrust has

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received and reviewed the Title Commitments.  Attached hereto as Exhibits D-1 and D-2 are proforma title insurance policies based on the Title Commitments (the “Proforma Policies”).  The Proforma Policies are hereby deemed satisfactory by Wintrust.

(b)SurveysThe Company shall deliverhas delivered to Wintrust, at the Company’sWintrust’s sole expense, with respect toan ALTA survey of each parcel of theBank Owned Real Property other than the OREO property listed onSchedule 4.7(a), no later than thirty (30) days after the date hereof, a date down endorsement to the Company’s existing title insurance policy for such parcel (each an “Existing Policy” and collectively, the “Existing Policies”) in the form attached asExhibit F (collectively, the “Date Down Endorsements”). Each Date Down Endorsement shall be issued by the title insurance company that issued the Existing Policy being endorsed and shall have an effective date as near as feasible to the date of delivery of such Date Down Endorsement to Wintrust.

(b)Surveys. Prior to the date of this Agreement, the Company delivered to Wintrust the Company’s existing surveys with respect to the Real Property. Except for those parcels listed onSchedule 4.7(b), within thirty (30) days after the date of this Agreement, the Company shall, at the Company’s sole expense, obtain a new survey for each parcel of the Real Property which (i) shall include easements, if any, that are for the benefit of all or any portion of the Real Property, (ii) shall be updated and certified to Wintrust, the Title Insurer and such other persons as Wintrust shall reasonably request by a registered Wisconsin land surveyor as having been prepared in accordance with the current Minimum Standard Detail Requirements for ALTA/ACSM Land Surveys, jointly established and adopted by ALTA and NSPS in 2011, and shall include Items 1-4, 6(b), 7(a), 7(b)(1), 7(c), 8-10, 11(a), 13, 14, 16-19 and 21 of Table A thereof; and (iii) shall show any encroachments over recorded easements or onto adjacent property by the buildings or other improvements on the Real Property or encroachments onto the Real Property by any improvements located on the adjacent property (collectively, the “Surveys”).

(c)Title Defects.Upon receipt of the last to be Wintrust has received of the Date Down Endorsements, Title Commitments,and reviewed the Surveys, and all Schedule B documents referenced in the Date Down Endorsements, Existing Policies, Title Commitments and the Surveys, Wintrust will have a periodcopies of ten (10) days to examine those deliveries and notify the Company in writing (the “Title Defect Notice”) of (i) any defects or objections materially affecting the marketability of the title to the Real Property which are not included in the Permitted Encumbrances (the “attached hereto as Exhibit E-1 and E-2. The Surveys are hereby deemed satisfactory by Wintrust.

(c)Title Defects”) and (ii) any endorsements (“Title Endorsements”) to the Existing Policies or Title Policies (as defined below) reasonably required by Wintrust. Without limiting the generality of the foregoing, the Title Endorsements shall include an extended coverage endorsement deleting or insuring over all general or standard exceptions to title customarily contained in owner’s title insurance policies and, except for OREO properties listed onSchedule 4.7(b), a 3.1 zoning endorsement (with parking coverage). Upon its receipt of the Title Defect Notice, the Company will have until the Closing Date to cure the Title Defects and obtain the Title Endorsements at the Company’s sole expense. If the Company fails or elects not to cure the Title Defects or obtain the Title Endorsements by the Closing Date, Wintrust will have the option in its sole discretion to: (x) terminate this Agreement by giving written notice of termination to the Company; or (y) accept title to the Real Property with the Title Defects and without the Title Endorsements, subject to a reduction in the Merger Consideration equal to an amount to be mutually agreed upon in good faith by Wintrust and the Company.

(d)Title Insurance.  At the Closing, the Company at its sole expense, shall obtain and deliver to Wintrust, with respect to each parcel of the Real Property either (a) a Date Down Endorsement to each Existing Policy, or (b) anat Wintrust’s sole expense, owner’s title insurance policy (or an irrevocable commitmentpolicies issued by the Title Insurer and dated as of the Closing Date, in the form of each applicable Proforma Policy, insuring the fee simple estate of the Bank or the Surviving Company, as applicable, in the applicable parcels of Bank Owned Real Property in the amounts set forth on Schedule 4.7(c), subject only to issue such a policy) on ALTAthe matters set forth in the applicable Proforma Policy Form 2006,and, if available (if not available, then Form B-1992)applicable, any Permitted Encumbrances permitted under Section 4.7(d) below (collectively, the “Title Policies”). The Title Policies shall (i) be issued by the Title Insurer with the required Title Endorsements, (ii) be dated as of the Closing Date, and (iii) insure fee simple title to the Real Property in the Bank in an amount not less than the current

value at which the Company carries the Real Property on its books, subject only to the Permitted Encumbrances. The Date Down Endorsements shall (1) be issued by the applicable title company that issued the Existing Policy being endorsed, (2) be accompanied by the required Title Endorsements, all of which shall be dated as of the Closing Date, (3) be dated as of the Closing Date, and (4) insure fee simple title to the Real Property in the Bank in an amount not less than the current value at which the Company carries the Real Property on its books, subject only to the Permitted Encumbrances.(d)                                 The Company shall indemnifynot voluntarily encumber the Title Insurer andBank Owned Real Property prior to the applicable title companies issuingClosing Date.  In the Date Down Endorsements, or provide such other assurances or security as may be reasonably required by such companies, in order to cause them to insure overevent that the so-called recording gap period and issueCompany cannot obtain any of the Title Policies, and Date Down Endorsements effective onWintrust has not, prior to the Closing Date.Date, given notice to the Company that it is willing to waive objection to each title exception which is not set forth in the applicable Proforma Policy (each, a “New Encumbrance”), the Company shall discharge or remove each such New Encumbrance that can be discharged or removed by the payment of a liquidated sum of money, provided, however, the Merger Consideration shall be reduced by any such amounts paid by Wintrust on behalf of the Company at Closing.  The Company shall use commercially reasonable efforts to discharge any New Encumbrance that cannot be discharged solely by the payment of a liquidated sum of money, unless such New Encumbrance is a Permitted Encumbrance.  Wintrust shall not have any right of action against the Company, at law or in equity, for the Company’s inability to obtain the Title Policy not subject to any New Encumbrance, unless the Company has breached its obligations set forth in the first sentence of this Section 4.7(d).  The Company shall be entitled to postpone the Closing Date for up to 30 days in the aggregate in order to discharge any New Encumbrance which is not a Permitted Encumbrance.  If the Company has not discharged any New Encumbrance that is not a Permitted Encumbrance and which cannot be discharged solely by the payment of a liquidated sum of money on or prior to the Closing Date (subject to any postponement in accordance with the preceding sentence), and if such New Encumbrance, in the sole determination of Wintrust, would reasonably be expected (i) to materially interfere with the use or operation of such Real Property or (ii) to materially affect the fair market value of such Real Property, then Wintrust shall have the right to terminate this Agreement pursuant to Section 9.2(c).

(e)

4.8No Solicitation by Company.

(a)FeesTermination of Existing Discussions.  The Company shall, and Wintrust shall cause each bear one half (1/2) of the costits Representatives to, cease immediately and expense of any recording fees imposedcause to be immediately terminated all soliciting activities, discussions and negotiations and access to nonpublic information with, to or by any governmental authority with regardPerson (other than Wintrust or Merger Co.) regarding any proposal that constitutes, or could reasonably be expected to the Real Property. Thelead to, any Company and Wintrust shall each bear one half (1/2) ofTakeover Proposal.  Except as expressly permitted pursuant to Section 4.8(c), the cost of all recording fees incurred in connection with the Real Property, and the Company shall pay the cost of all recording fees, if any, incurred in connection with curing any Title Defects.

4.8No Conduct Inconsistent with this Agreement.

(a) The Company shall not, and shall cause its Representatives not to, at any time after the Bank to not, during the termexecution of this Agreement, continue or resume any such soliciting activities, discussions, negotiations or access to nonpublic information with, by or to any Person (other than Wintrust and Merger Co.) with which the Company entered into a confidentiality, standstill or similar agreement before the execution and delivery of this Agreement or had discussions or negotiations before the execution and delivery of this Agreement regarding any proposal that constituted, or could reasonably have been expected to lead

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to, any Company Takeover Proposal (any such Persons and their Affiliates and Representatives being referred to as “Prior Company Bidders”).  The Company shall promptly request that each Prior Company Bidder in possession of nonpublic information that was furnished by or on behalf of the Company or any Company Subsidiary in connection with its consideration of any potential Company Takeover Proposal return or destroy all such nonpublic information heretofore furnished to such Prior Company Bidder and immediately terminate all physical and electronic dataroom access previously granted to any such Prior Company Bidder.

(b)Prohibition on Soliciting Activities.  Except as permitted by Section 4.8(c), the Company shall not, and shall cause each of its Representatives not to, directly or indirectly, (i) solicit, initiate or encourage, or knowingly facilitate, any inquiries or proposalsthe making of any proposal or offer that constitutes, or could reasonably be expected to lead to, any Company Takeover Proposal, (ii) enter into any agreement with respect to any Company Takeover Proposal or initiate or(iii) participate in any discussions or negotiations or discussions with, any Person concerning, any proposed transaction or series of transactions involving or affecting the Company or the Bank (or the securities or assets of either) that, if effected, would constitute an acquisition of control of either the Company or the Bank within the meaning of 12 U.S.C.A. §1817(j) (disregarding the exceptions set forth in 12 U.S.C.A. §1817(j)(17)) and the regulations of the Federal Reserve thereunder (each, an “Acquisition Proposal”), or furnish any information (whether orally or in writing) or access to the business, properties, assets, books or records of the Company or any Company Subsidiary to, or otherwise cooperate with, knowingly assist, or participate in, facilitate or encourage any effort by, any Person (or any Representative of a Person) that has made, is seeking to make, has informed the Company of any intention to make, or has publicly announced an intention to make, any proposal that constitutes, or could reasonably be expected to lead to, any Person proposingCompany Takeover Proposal.  Any violation of the restrictions set forth in Section 4.8(a) or seeking an Acquisition Proposal.this Section 4.8(b) by any Representative of the Company shall be deemed to be a breach of this Section 4.8 by the Company.

(b) Notwithstanding

(c)Discussions Permitted in Certain Circumstances.  Before receipt of the foregoing,Company Shareholder Approval, the Company and its Representatives may, to the extent required by the fiduciary obligations of the Company Board, as determined in good faith by it based on the eventadvice of outside counsel, in response to a bona fide, written Company Takeover Proposal received after the date of this Agreement that the Company Board determines, in good faith, and after consultation withbased on the advice of outside counsel that in lightis reasonably capable of an Acquisitionmaking a Superior Company Proposal (other than an Acquisition Proposal the terms of which were made known to the Company Board prior to the date hereof), it is necessary to provide such information or engage in such negotiations or discussions in order to act in a manner consistent with such Board’s fiduciary duties, the Company Board may, in response to an Acquisition Proposal which was not solicited by or on behalf of the Company or the Bank or which did not otherwise result from a breach of Section 4.8(a), subject to its compliance with Section 4.8(c), (i) furnish information with respect to the Company or the Bank to such Person making such Acquisition Proposal pursuant to a customary confidentiality agreement that is no less restrictive than the Confidentiality Agreement and (ii) participate in discussions or negotiations regarding such Acquisition Proposal. In the event that the Company Board determines, in good faith, and after consultation with outside counsel, thatbased on the Acquisition Proposaladvice of the Company’s independent financial advisor, is reasonably likely to result in a Superior AcquisitionCompany Proposal (as defined below)that was not solicited by the Company and that did not otherwise result from a breach or a deemed breach of this Section 4.8, and subject to compliance with Section 4.8(f), (x) furnish information with respect to the Company to the Person making such Company Takeover Proposal and its Representatives pursuant to a confidentiality agreement not less restrictive of the other party than the Confidentiality Agreement and (y) participate in discussions and negotiations (including solicitation of a revised Company Takeover Proposal) with such Person and its Representatives regarding such Company Takeover Proposal.  The Company shall provide to Wintrust copies of all nonpublic information (to the extent that such nonpublic information has not been previously provided or made available to Wintrust) that is made available to any such third party before or substantially concurrently with the time it is necessaryprovided or made available to pursue such Superior Acquisition Proposalthird party.  The Company shall not furnish any information or participate in orderany discussions or negotiations with any Person pursuant to act in a manner consistent with such Board’s fiduciary duties,this Section 4.8(c) unless the Company may (A)notifies Wintrust in writing of its intention to take such action, promptly after the Company Board resolves to take such action, which notice shall include the identity of such Person, a true and complete copy of the most current version of any applicable Company Takeover Proposal (including any proposed agreement or other offer documents) and a true and complete copy of the applicable confidentiality agreement.  The Company shall keep Wintrust promptly advised of all material developments (including all changes to the material terms of any Company Takeover Proposal), discussions or negotiations regarding any Company Takeover Proposal and the status of such Company Takeover Proposal.

(d)Company Recommendation.  Except as permitted by Section 4.8(e), the Company shall cause the Proxy Statement to include the recommendation of the Company Board to the

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Company’s shareholders that they give the Company Shareholder Approval (the “Company Recommendation”).  Except as permitted by Section 4.8(e), neither the Company Board nor any committee thereof shall (i) withdraw modify or otherwise changemodify in a manner adverse to Wintrust or Merger Co., or propose publicly to withdraw or modify in a manner adverse to Wintrust or Merger Co., the Company’sapproval or recommendation to its shareholdersby the Company Board of this Agreement or the Merger (it being understood that taking a neutral position or no position with respect to this Agreementany Company Takeover Proposal shall be considered an amendment or adverse modification), (ii) enter into, approve, adopt or recommend, or propose publicly to enter into, approve, adopt or recommend, any Company Takeover Proposal or any letter of intent, term sheet, agreement in principle, merger agreement, acquisition agreement, option agreement, joint venture agreement, partnership agreement or other Contract or instrument constituting or relating to any Company Takeover Proposal (other than a confidentiality agreement that complies with Section 4.8(c), (iii) take any action to make the provisions of any “fair price,” “moratorium,” “control share acquisition,” “business combination” or other similar anti-takeover statute or regulation, or any restrictive provision of any applicable anti-takeover provision in the Company’s articles of incorporation or bylaws, inapplicable to any transactions contemplated by a Company Takeover Proposal, or take any other action inconsistent with the Company Recommendation, (iv) waive the benefits of, provide any consent under, permit any noncompliance with, fail to enforce, or agree to modify in any manner, any confidentiality, standstill or similar agreement to which the Company or any Company Subsidiary is a party or (v) authorize any of, or resolve, commit or agree to take any of, the foregoing actions (any of the foregoing, a “Company Recommendation Change”).  Without limiting the foregoing, any violation of the restrictions set forth in the preceding sentence by any Representative of the Company shall be deemed to be a Company Recommendation Change.

(e)Change in Recommendation Permitted in Certain Circumstances.  If the Company and the Merger, and/or (B) terminateCompany Subsidiaries have complied with all their obligations under this AgreementSection 4.8, and the Company Board receives a Superior Company Proposal and as a result thereof the Company Board determines in good faith, based on the advice of outside counsel, that it is necessary to do so in order to concurrently enter into an agreementcomply with respect to such Superior Acquisition Proposal;provided,however, thattheir fiduciary obligations, then before receipt of the Company Shareholder Approval (and in no event after receipt of the Company Shareholder Approval) the Company Board may make a Company Recommendation Change.  The Company Board shall not terminate this Agreementmake a Company Recommendation Change pursuant to this Section 4.8(b) unless and until (x) five (5) business days have elapsed following4.8(e) unless: (1) the deliveryCompany notifies Wintrust in writing of its intention to Wintrust of a written notice oftake such determination byaction, promptly after the Company Board resolves to take such action but in any event not less than five business days before taking such action, which notice shall include the identity of the offeror and duringa true and complete copy of the most current version of such Superior Company Proposal (including any proposed agreement or other offer documents), (2) for five (5) business-day period,business days following delivery of such notice, the Company negotiates in good faith with Wintrust with respect to any revised proposal from Wintrust in respect of the terms of the Merger and the Bank otherwise cooperate withother transactions contemplated hereby (to the extent Wintrust desires to negotiate) with the intent of enabling the Parties to engage in good faith negotiations so that the Merger and other transactions contemplated hereby may be effected and (y)(3) Wintrust does not make, within such five-business day period, an offer that is at least as favorable to the endshareholders of such five (5) business-day periodthe Company, as determined by the Company Board continues reasonably to believe the Acquisition Proposal at issue constitutes a Superior Acquisition Proposal. A “Superior Acquisition Proposal” shall mean any Acquisition Proposal containing terms which the Company Board determines in its good faith judgment (basedbased on the advice of anthe Company’s independent financial advisor) to be more favorableadvisor, as such Superior Company Proposal (it being understood that any amendment to the Company’s shareholders than the Merger and for which financing, to the extent required, is then committedfinancial terms or which, in the good faith judgmentother material terms of any such Superior Company Proposal shall require a new written notice from the Company Board, is reasonably capable of being obtained by such third party, butand an additional five-business day period that satisfies this Section 4.8(e)).

(f)Required Notices.  The Company promptly and in any event within one business day shall exclude any Acquisition Proposal the terms of which were made known to the Company Board prior to the date of this Agreement.

(c) In addition to the obligations of the Company set forth in Section 4.8(a) and (b), the Company shall immediately advise Wintrust orally and in writing of any request for informationCompany Takeover Proposal or of any Acquisition Proposal, the material terms and conditions of such requestinquiry with respect to, or Acquisitionthat could reasonably be expected to lead to, any Company Takeover Proposal, and the identity of the Person making any such requestCompany Takeover Proposal or Acquisition Proposal.inquiry and the material terms of any such Company Takeover Proposal or inquiry.  The Company shall (i) keep Wintrust fully

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informed on a current basis of the status and details (including amendments or proposed amendments) of any such request or Acquisition Proposal, including the status of any discussionssuch Company Takeover Proposal or negotiationsinquiry, including any change to the material terms thereof and (ii) provide to Wintrust promptly and in any event within one business day after receipt or delivery thereof copies of all correspondence and other written material sent or provided to the Company from any third party in connection with any Company Takeover Proposal or sent or provided by the Company to any third party in connection with any Company Takeover Proposal.

(g)Disclosures under Law.  Nothing in this Section 4.8 shall prohibit the Company Board from (A) taking and disclosing to the Company’s shareholders a position contemplated by Rule 14e-2(a), Rule 14d-9 or Item 1012(a) of Regulation M-A promulgated under the Exchange Act, or other law, or (B) making any disclosure to the Company’s shareholders if the Company Board determines, after consultation with outside counsel, that failure to so disclose such position would be reasonably likely to give rise to a violation of law, in each case so long as such disclosure is limited to (x) a “stop, look and listen” or similar communication of the type contemplated by Rule 14d-9(f) promulgated under the Exchange Act, (y) an express rejection of an applicable Company Takeover Proposal or (z) an express reaffirmation of the Company Recommendation.

(h)Certain Definitions.  For purposes of this Agreement:

(i)                                     “Company Takeover Proposal” means any offer or proposal by any Person concerning any (i) merger, consolidation, other business combination or similar transaction involving the Company or any Company Subsidiary, pursuant to which such Person (or the shareholders of such Person) would own 15% or more of the consolidated assets, revenues or net income of the Company, (ii) sale, lease, license or other disposition directly or indirectly by merger, consolidation, business combination, share exchange, joint venture or otherwise, of assets of the Company or any Company Subsidiary (including equity interests of any of Company Subsidiary) representing 15% or more of the consolidated assets, revenues or net income of the Company, (iii) issuance or sale or other disposition (including by way of merger, consolidation, business combination, share exchange, joint venture or similar transaction) of equity interests representing 15% or more of the outstanding stock of the Company, (iv) transaction or series of transactions in which any Person (or the shareholders of such Person) would acquire beneficial ownership or the right to acquire beneficial ownership of equity interests representing 15% or more of the outstanding stock of the Company or (v) any combination of the foregoing.

(ii)                                  “Representative” means, with respect to any Person, any direct or indirect subsidiary of such Person, or any officer, director, employee, investment banker, attorney or other agent, advisor or representative of such Person or any direct or indirect subsidiary of such Person.

(iii)                               “Superior Acquisition Proposal.Company Proposal” means a bona fide written Company Takeover Proposal (except that references in the definition of “Company Takeover Proposal” to “15% or more” shall be replaced by “80% or more”), on its most recently amended or modified terms, if amended or modified, received by the Company on or after the date of this Agreement, for which any necessary financing is committed and that the Company Board determines in good faith (based on the advice of outside legal counsel and its independent financial advisor) to be (i) more favorable to the holders of Company Common Stock than the Transactions (taking into account the likelihood of effecting the transaction, including all financial, legal, regulatory and other aspects thereof, and taking into account all the terms and conditions of such proposal and this Agreement (including any changes to the terms of this Agreement proposed by Wintrust in response to such proposal or otherwise)) and relevant legal, financial and regulatory aspects of the proposal, the identity of the third party making such proposal and the conditions for completion of such proposal and (ii) reasonably expected to be completed, taking into account all financial, legal, regulatory and other aspects of such proposal.

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4.9Loan Charge-Off; Pre-Closing Loan Review.

(a)                                 The Company shall cause the Bank, prior to the Closing Date, (i) to write off all Loans of the Bank that are required to be written off by the Bank’s regulators or that, in conformity with past practices and policies of the Bank and GAAP, should be written off as Loan losses and (ii) to write down potential Loan losses in conformity with past practices and policies of the Bank and GAAP.  Any such write down shall not have any effect on, or result in a breach of, the representations and warranties under Section 2.8 made by the Company as of the date of this Agreement and shall not result in a Material Adverse Effect on the Company, but shall be taken into account in determining the Minimum Adjusted Net Worth (as defined in Section 6.106.9 below) of the Company as of the Closing Date; and nothing in this Section 4.9(a) shall require the Company to make any additional provision to the Bank’s reserve for loan losses so long as such reserve, determined as described in Section 2.82.8(b) and in compliance with the second sentence of Section 4.11 below, is adequate and in compliance with GAAP.

(b)                                 The Company shall cause the Bank to make available to Wintrust the files maintained by the Bank with respect to, and information regarding the status of, each Loan contained in the Loan portfolio of the Bank, as of a date not more than 15 days prior to the Closing Date.

4.10Director and Officer Insurance Coverage.Coverage

(a).  Wintrust agrees to provide each of the directors, and officers, members, or managers of the Company and the BankCompany Subsidiaries who continue to hold such positions after the Effective Time substantially the same insurance coverage against personal liability for actions taken after the Effective Time as is provided to current directors and officers of Wintrust’s subsidiary banks.  Without limiting the generality of the preceding sentence, on or prior to the Closing Date, the Company and the BankCompany Subsidiaries shall purchase for a period of six (6) years following the Effective Time, at Wintrust’s expense (so long as the premium or premiums are acceptabledo not exceed $125,000, and Wintrust shall cause to Wintrustbe maintained in its sole discretion),effect, for the benefit of the BankCompany and the Company Subsidiaries (including their respective successors) and individuals who were officers, directors, members or directorstrustees of the BankCompany or the Company Subsidiaries (but only in their capacity as such) immediately prior to Closing, a tail policy or policies providing coverages equivalent to the level and scope of directors’ and officers’ liability and other professional insurance coverages as set forth in the Company’s and the Bank’sCompany Subsidiaries’ current directors’ and officers’ liability and other professional insurance policies in effect as of the Closing, whichClosing.  If such tail policy or policiescoverage cannot be purchased for the maximum premium described above, the Company and the Company Subsidiaries shall be for terms of six (6) years or, if such term of coverage is not available, such other maximum period of coverage thatobtain as much comparable insurance as is available at a cost consistent with the cost incurred by the Company’s or the Bank’s current directors’ and officers’ liability and other professional insurance policies in effect as of the Closing.

(b)for such maximum premium.  In the event the current insurer of such policies issued by the Company and the Bank declines to provide the tail policy or policies described above,prior to the Closing Date, or after the Effective Time terminates the tail policy, or policies described above, the Company (if prior to the Closing Date) or Wintrust (if after the Effective Time) shall use its commercially reasonable efforts to identify and obtain similar covercoverage from another insurance carrier of substantially similar size reputation and creditworthinessreputation to that of such former insurer, if such coverage is reasonably obtainable from the marketplace.  If after such reasonable efforts another such insurance carrier is unable toor unwilling to provide such similar coverage, the Company (if prior to the Closing Date) or Wintrust (if after the Effective Time) shall obtain the best coverage available, as determined in the reasonable judgment of the Company or Wintrust, as applicable.

(c)applicable, for a cost up to but not exceeding the maximum premium.  Notwithstanding anything to the contrary herein, and regardless of the purchase of insurance coverage under thisSection 4.10,, Wintrust acknowledges and agrees that, after Closing, individuals who were officers, directors, members, or directorsmanagers of the Company, the Bank, or the Bank Subsidiary prior to Closing shall continue to be entitled to indemnification for acts and omissions occurring prior to Closing, to the extent of any indemnification provided to such individuals on the date hereof inunder the WBCL,applicable law where the Company or the Company Subsidiaries are chartered or organized, the articles of incorporation or by-lawsbylaws of the Company, the charter and bylaws of the Bank, or the operating agreement of the Bank Subsidiary, as applicable.

applicable, and it will, and will cause the Surviving Company to indemnify the current and past directors, officers, members, and managers of the Company and the Company

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Subsidiaries in a manner reasonably consistent with the above.  The provisions of this Section 4.10 shall survive the Effective Time and are intended to be for the benefit of, and will be enforceable by, each director, officer, member or trustee who is now, or has been at any time prior to the date of this Agreement or becomes prior to the Effective Time, a director, officer, member or trustee of Company or any of the Company Subsidiaries.

4.11Interim Financial Statements.Prior to the Closing Date, the Company shall deliver to Wintrust a monthly balance sheet, income statement and statement of shareholders’ equity of the Company and each of the Company Subsidiaries as of the end of each month as promptly as practicable after they become available.  Such monthly financial statements shall be prepared consistent with past practice and in conformity in all material respects with GAAP (excluding footnote disclosure) applied on a basis consistent with the Financial Statements.

4.12Dissent Process.The Company will give to Wintrust prompt notice of any written notice or demands for appraisal for any Company Common Stock, any attempted withdrawals of such demands and any other notice given or instrument served relating to the exercise of dissenters’ rights granted under the WBCL,IBCA, including the name of each dissenting shareholder and the number of shares of Company Common Stock to which the dissent relates.  Wintrust will have the right to participate in all negotiations and proceedings relating thereto, except as otherwise required by law.  The Company will not make any payment with respect to, or settle or offer to settle, any appraisal demands without Wintrust’s prior written consent.

4.13Section 368(a) Reorganization.  Either prior to or after the Closing Date, none of the Parties shall take or cause to be taken any action, or omit to take any action or cause any omission, which would cause the Merger not to qualify as a reorganization in accordance with Section 368(a) of the Code.  The Parties agree to take any and all necessary or advisable steps to restructure or modify the terms of the transaction contemplated hereby, if such steps are necessary or advisable to qualify the transaction contemplated hereby as a reorganization in accordance with Section 368(a) of the Code;provided,however, that nothing in this Section 4.13 shall be deemed to require the Parties to take any steps that will increase the Per Share Merger Consideration.  Within forty-five (45) days following the Effective Time, Wintrust shall comply with the reporting requirements of Section 1.6045B-1(a)(2) of the Treasury Regulations. Each of the Parties shall report the Merger as a reorganization within the meaning of Section 368(a) of the Code on its United States federal income Tax Return, unless otherwise required pursuant to a “determination” within the meaning of Section 1313(a) of the Code.

4.14Treatment of Options.Notwithstanding anything contained in this Agreement to the contrary, Wintrust and the Company each acknowledge and agree that the holder of any Outstanding Company Option may, at any time prior to the fifth (5th) calendar day preceding the Closing Date, exercise such Outstanding Company Option in accordance with its terms and conditions.

4.15Untrue Representations and Warranties.  During the term of this Agreement, if any Party becomes aware of any facts, circumstances or of the occurrence or impending occurrence of any event that would cause one or more of such Party’s representations and warranties contained in this Agreement to be or to become untrue as of the Closing Date then:

(a)                                 such Party shall promptly give detailed written notice thereof to the other Parties; and

(b)                                 such Party shall use reasonable and diligent efforts to change such facts or events to make such representations and warranties true, unless the same shall have been waived in writing by the other Parties.

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4.16Shareholder Litigation.  The Company Indebtedness.Subjectshall give Wintrust the opportunity to participate in the defense or settlement of any shareholder litigation against the Company and its directors relating to the satisfactionMerger or waiverany other Transaction.  Neither the Company nor any Company Subsidiary shall agree to any settlement of any such litigation without the prior written consent of Wintrust.

4.17Notice of Certain Events.  During the term of this Agreement, the Company shall promptly notify Wintrust in writing of:

(a)                                 any fact, circumstance, event or action the existence, occurrence or taking of which (i) has had, or could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect on the Company or a Company Subsidiary, (ii) has resulted in, or could reasonably be expected to result in, any representation or warranty made by the Company hereunder not being true and correct in a manner that would cause any of the conditions in Section 6.1 not to be satisfied or (iii) has resulted in, or could reasonably be expected to result in, the failure of any of the other conditions set forth in ARTICLE VI Wintrustto be satisfied;

(b)                                 any notice or other communication from any Person alleging that the consent of such Person is or may be required in connection with the transactions contemplated by this Agreement;

(c)                                  subject to the restrictions on sharing of confidential supervisory information, any notice or other material communication from any Governmental Authority in connection with the transactions contemplated by this Agreement; and

(d)                                 any claim, action, suit or other proceeding instituted or threatened against, relating to or involving or otherwise affecting the Company, any Company Subsidiary or any of their respective personnel or properties that, if pending on the date of this Agreement, would have been required to be disclosed pursuant to Section 2.14 or that relates to the consummation of the transactions contemplated by this Agreement.

Wintrust’s receipt of information pursuant to this Section 4.17 shall assume the indebtedness ofnot (i)��operate as a waiver or otherwise affect any representation, warranty, covenant or agreement given or made by the Company in an amount notthis Agreement, (ii) be deemed to exceed $3,600,000 asamend or supplement any information disclosed on any of the Effective Time.Company’s Schedules attached hereto, or (iii) limit or modify in any way Wintrust’s termination rights set forth in Section 9.1.

4.17

4.18Reasonable and Diligent Efforts.  The Parties shall use reasonable and diligent efforts in good faith to satisfy the various conditions to Closing and to consummate the Merger as soon as practicable.  No Party will intentionally take or intentionally permit to be taken any action that would be in breach of the terms or provisions of this Agreement (including any action that would impair or impede the timely obtainment of the regulatory approvals referenced in Sections 6.3 and 7.3)and7.3) or that would cause any of the representations contained herein to be or become untrue.

ARTICLE V


EMPLOYEE BENEFIT MATTERS

5.1Benefit Plans.  Effective as of the Closing Date, each full-time Employee who is employed by the Company or the Bank as of the Closing Date (each such employee, a “Transferred Employee”) shall become eligible for and entitled to participate in Wintrust’s benefit plans on the same terms and subject to the same conditions as all other similarly-situated U.S. employees of Wintrust and its subsidiaries.  To the extent Transferred Employees participate in any Wintrust benefit plans, Employeeseach such

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Transferred Employee shall be given credit for amounts paid under a corresponding Benefit Plan during the plan year in which the Closing occurs for purposes of applying deductibles, co-payments and out-of-pocket maximums as though such amounts had been paid in accordance with the terms and conditions of such Wintrust benefit plan for the plan year in which the Closing occurs.  The Company shall use commercially reasonable efforts to cause its health insurance providers, to the extent permitted under applicable law, (i) to provide to Wintrust a schedule of de-identified information regarding the claims experience of insured persons under the applicable Benefit Plans, and (ii) to provide Wintrust with de-identified information as to any significant pre-existing conditions of any insured persons that are not reflected in such schedule.  Wintrust shall use its reasonable and diligent efforts to cause any pre-existing condition limitations (as administered in accordance with applicable law) under Wintrust’s medical benefit plans to be waived to the extent such conditions have been waived under the Company’s health insurance plans.  For purposes of determining eligibility to participate in, vesting and wherebenefit accrual under each applicable vesting under Wintrust’s applicable retirement savingsWintrust benefit plan and employee stock purchase plan, Wintrust’s short-term disability plans and vacation policy, each Transferred Employee shall receive past service credit for his or her prior employment with the Company as if such Transferred Employee had then been employed by Wintrust.  Wintrust reserves the right to change or terminate its employee benefit plans at any time.

5.2No Rights or Remedies.  Nothing in this Article shall confer upon any Employee or his or her legal representative, any rights or remedies, including any right to employment, or continued employment, for any specified period, or any nature or kind whatsoever under or by reason of this Agreement.

ARTICLE VI


CONDITIONS PRECEDENT TO


OBLIGATIONS OF WINTRUST AND MERGER CO.

Unless the conditions are waived by Wintrust, all

All obligations of Wintrust and Merger Co. under this Agreement are subject to the fulfillment or waiver, on or before the Closing, of each of the following conditions:

6.1Representations and Warranties; Performance of Agreements.  Each of the representations and warranties contained in ARTICLE II that are qualified by materiality shall be true and correct in all respects as of the Closing Date, and each of the representations and warranties contained in ARTICLE II that are not qualified by materiality shall be true and correct in all material respects, except to the extent such representations and warranties speak as of an earlier date, they shall be tested as of such earlier date.  The Company shall have performed in all material respects all agreements, covenants and undertakings herein required to be performed by the Company on or before the Closing.

6.2Closing Certificate.Certificates.  Wintrust shall have received from the Company the following:

(a)a certificate of the Company signed by a senior executive officer of the Company, dated as of the Closing Date, certifying in such detail as Wintrust may reasonably request, as to the fulfillment ofeffect that the conditions to the obligations of Wintrust set forth in Section 6.1 of this Agreement that are required to be fulfilledhave been satisfied; and

(b)                                 a certificate signed by the secretary of the Company certifying as of the Closing Date (i) a true and complete copy of the organizational documents of the Company; (ii) true and complete copies of the resolutions authorizing the execution, delivery and performance by the Company on or beforeof this Agreement and the Closing. Such certificate shall certify, toconsummation of the satisfaction of Wintrust, that the Bank has conducted its business as described in Section 4.1.transactions contemplated by this Agreement; and (iii) incumbency matters.

6.3Regulatory and Other Approvals.  Wintrust shall have obtained the approval of all appropriate regulatory entitiesGovernmental Authorities of the transactions contemplated by this Agreement and the

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Merger, all required regulatory waiting periods shall have expired, and there shall be pending on the Closing Date no motion for rehearing or appeal from such approval or any suit or action seeking to enjoin the Merger or to obtain substantial damages in respect of such transaction.

6.4Approval of Merger andMerger; Delivery of Articles of MergerIL SOS Filings..  This Agreement and the transactions, agreements, and agreementscovenants contained herein or contemplated hereby, including the Merger and the appointment of the Shareholders’ Agent, shall have been approved by the shareholders of the Company in accordance with the Company’s articles of

incorporation, by-laws and the WBCL,IBCA (the “Company Shareholder Approval”), and the proper officers of the Company shall have executed and delivered to Wintrust the Articles of Merger, in form suitable for filing with WDFI,the IL SOS in the manner contemplated by Section 1.2, and shall have executed and delivered all such other certificates, statements or instruments as may be necessary or appropriate to effect such a filing.  Not greater than 5% of the shares of Company Common Stock Outstanding as of the Closing shall constitute or be eligible to become Dissenting Shares.

6.5No LitigationLitigation..  No suit or other action shall have been instituted or threatened in writing seeking to enjoin the consummation of the Merger or to obtain other relief in connection with this Agreement or the transactions contemplated herein that Wintrust believes, in good faith and with the written advice of outside counsel, makes it inadvisable to consummate the Merger by reason of the probability that the proceeding would result in the issuance of an order enjoining the Merger or in a determination that the Company or any of the Bank or the Bank SubsidiaryCompany Subsidiaries has failed to comply with applicable legal requirements of a material nature in connection with the Merger or actions preparatory thereto or would have a Material Adverse Effect on the Company or the Bank.

6.6Environmental Review.

(a)Environmental Surveys. The Company has provided to Wintrust copies of certain existing environmental assessments and reports that the Company or the Bank have obtained in connection with any of the Real Property. Within thirty (30) days followingCompany Subsidiaries.  No temporary restraining order, preliminary or permanent injunction or other order issued by a court of competent jurisdiction or other legal restraint or prohibition preventing the date of this Agreement, the Company shall deliver to Wintrust, at the Company’s sole expense, a Phase I environmental assessment or an updateconsummation of the existing Phase I environmental assessment for each parcel of the Real Property (other than real property reflected on the latest balance sheet of the Bank as OREO) (each, an “Environmental Survey”, and collectively, the “Environmental Surveys”). In the event that an Environmental Survey indicates or tends to indicate the presence or the suspected presence of an Environmental Condition (in the sole discretion of Wintrust), Wintrust will give the Company written notice of the presence or the suspected presence of the Environmental Condition within ten (10) Business Days of receipt of such Environmental Survey (together with all information it possesses relating to the Environmental Condition). For purposes of this Agreement, an “Environmental Condition” shall mean (i) an above ground storage tank, underground storage tank, subsurface structure or container, and its associated piping, which is present at the Real Property and which violates an Environmental Law; (ii) a Hazardous Material found in building materials at the Real Property or present in soil and/or groundwater at the Real Property which violates an Environmental Law; (iii) a discharge, emission or release of a Hazardous Material related to the Real Property which violates an Environmental Law; (iv) an event or condition that likely has occurred or exists with respect to the Real Property which constitutes a violation of an Environmental Law; or (v) an event or condition related to the Real Property which requires cleanup, remedy, abatement or restoration of contaminated surface water, groundwater, soil or natural resource under an Environmental Law.

(b)Phase II Survey. Within thirty (30) days of receipt of notice from Wintrust of the presence or suspected presence of an Environmental Condition, the Company shall deliver to Wintrust, at the Company’s sole expense, a physical examination and investigation of the Environmental Condition indicated in the applicable Environmental Survey (the “Phase II Survey”). The subject, scope, manner and method of the Phase II Survey will be subject to Wintrust’s prior review and reasonable approval, which approval shall not be unreasonably delayed, conditioned or withheld. The Company shall deliver to Wintrust with the Phase II Survey all written reports, analytical data, correspondence, notices or other written materials relating thereto (which collectively constitutes the “Phase II Survey Report”).

(c) If any Phase II Survey Report indicates or confirms, in the sole discretion of Wintrust, the presence of an Environmental Condition related to the Real Property, Wintrust will have until ten (10) Business Days from its receipt of such Phase II Survey Report to either (A) accept the Real Property in its current condition subject to a reduction in the Merger Consideration equal to an amount to be mutually agreed upon in good faith by Wintrust and the Company, or (B) notify the Company in writing that Wintrust has elected to terminate this Agreement; provided, however, that in the event the estimated cost of remediation of such Environmental Condition(s) is less than $200,000, at Wintrust’s election, in lieu of exercising its termination rights, Wintrust may accept the Real Property in its current condition but for purposes of Section 6.10(b), the shareholders’ equity set forth in the Closing Balance Sheets shall be reduced by the amount of such estimated cost of remediation, and the Company shall agree to such reduction, in which case the updated representations and disclosures referenced in the last sentence of Section 2.17 shall be deemed made. For purposes of clarification, if the parties are able to agree in good faith upon a reduction in the Merger Consideration pursuant to clause (A) in the preceding sentence, such same updated representations and disclosures referenced in the last sentence of Section 2.17 shall be deemed made.

effect.

6.76.6Opinion of CounselCounsel..Wintrust shall have received the opinion of BoardmanBarack Ferrazzano Kirschbaum & ClarkNagelberg LLP, counsel for the Company, dated as of the Closing Date, and in form substantially similar toExhibit CF and reasonably satisfactory to Wintrust and its counsel.

6.8

6.7Employment Agreements.  The persons identified onSchedule 6.86.7 shall each have entered into an employment or retention agreement with Wintrust or the Bank, executed and delivered on the date hereof and to become effective as of the Closing Date, in the formforms attached asExhibit DExhibits G-1 and G-2, and shall each be capable of performing his or her duties under his or her employment or retention agreement as of the Closing Date.

6.9

6.8No Adverse ChangesChanges..  Between the date of this Agreement and the Closing Date, the businesses of the Company the Bank and the Bank Subsidiary, taken as a whole,Company Subsidiaries shall have been conducted in the Ordinary Course of Business, except as otherwise required under this Agreement, in all respects consistent with soundprudent banking practices, and there shall not have occurred any change or any condition, event, circumstance, fact or occurrence, other than as required under this Agreement, that would have a Material Adverse Effect on the Company or the Bank.

6.10

6.9Minimum Net Worth and Loan Loss Reserve Requirements.

(a)                                 Five (5) business days prior to the Closing Date, the Company shall have delivered to Wintrust a consolidated balance sheetssheet for the Company the Bank and the Bank Subsidiary as of the Closing Date reflecting the Company’s good faith estimate of the accounts of the Company the Bank and the Bank Subsidiary, as applicable,on a consolidated basis as of the Closing Date (which, for the avoidance of doubt, shall include net income estimated to be earned by the Company the Bank and the Bank SubsidiaryCompany Subsidiaries, if applicable, through and including the Closing Date), prepared in conformity with past practices and policies of the Company the Bank and the Bank Subsidiary,Company Subsidiaries, and in

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accordance with GAAP applied on a basis consistent with the preparation of the Interim Financial Statements, and adjusted to reflect the following adjustments, specifications and charges (the “Closing Balance Sheets”).  The Closing Balance SheetsSheet shall reflect: (i) confirm that (A) thethere is no outstanding indebtedness of the Company does not exceed $3,600,000, which indebtedness shall be assumed by Wintrust,Company; and (B)(ii) that the Bank’s reserve for loan losses, determined as described in accordance with Section 2.8, shall be2.8(b), is not less than 1.50%1.20% of the Bank’s net Loans (gross Loans less unearned discounts), and (ii) reflect any adjustments contemplated by Section 6.6(c).  Wintrust shall have an opportunity to review and comment on the Closing Balance Sheets prior to the Closing Date.

(b)                                 If the Closing Balance SheetsSheet reflect shareholders’ equity in the Company (the “Adjusted Net Worth”) equal to or greater than $26,000,000 (thethe sum of $30,700,000 plus the amount of proceeds credited to shareholders’ equity, if any, from the exercise of Outstanding Company Options in accordance with Section 4.14, but excluding, from the period of December 31, 2018 until the Closing Date, (i) any positive security gains that may be recognized and (ii) any positive or negative changes to that amount of “Total Accumulated Other Comprehensive Losses” (such amount of adjusted shareholders’ equity, theMinimum Adjusted Net Worth”), then there willthe Merger Consideration shall be no adjustmentincreased dollar-for-dollar by an amount equal to the amount of such excess, and any such increase shall be allocated to the cash portion of the Per Share Merger Consideration.Consideration to be paid pursuant to Section 1.4(b)(i).  If the Closing Balance Sheets reflectreflects the Company’s shareholders’ equityAdjusted Net Worth is less than the Minimum Adjusted Net Worth, the Merger Consideration shall be reduced dollar-for-dollar by an amount equal to the amount of such shortfall, and any such reduction shall be allocated equally to the cash and stock portionsportion of the Per Share Merger Consideration. For purposes ofConsideration to be paid pursuant to Section 1.4(b)(i).  When determining the determination of Minimum Adjusted Net Worth, all accrualsthe Company’s equity shall be reduced by (i) any fees paid by or on behalf of the Company or any of the Company Subsidiaries in connection with the Merger, including but not limited to legal fees, accounting fees, investment banking fees and expenses for contributions and other payments made orfairness opinion fees, (ii) the after-tax basis of any costs to be made to any Benefit Plan shall be net of any income tax benefit derived from said accrued contribution and other paymentspaid by the Company or the Bank notwithstanding past practices and policiesas a result of the CompanyMerger in accordance with the terms of any change of control agreements, (iii) the amount of any payments or costs associated with the termination of those certain data processing agreements set forth on Schedule 6.9(b)(iii) in excess of $350,000; and (iv) the Bank.

6.11Title Commitments, Surveys. Wintrust shall have received Title Commitments and Surveys required under this Agreement for eachamount of any payments or costs associated with any New Encumbrances in accordance with the parcelssecond sentence of Real Property owned and used by the Bank, in form and substance satisfactory to Wintrust in its sole discretion.

6.12Delivery of Articles of MergerSection 4.7(d).  The proper officersParties agree that for purposes of determining the CompanyAdjusted Net Worth, all costs resulting from the data conversion process shall have executed and delivered to Merger Co.not be deducted from the Articles of Merger, in form suitable for filing with WDFI, and shall have executed and delivered all such other certificates, statements or instruments as may be necessary or appropriate to effect such a filing.

Adjusted Net Worth.

6.136.10ConsentsConsents..  The Company shall have obtained or caused to be obtained (a) all written consents required under Section 2.5, and (b) all other written consents, permissions and approvals as required under any agreements, contracts, appointments, indentures, plans, trusts or other arrangements with third parties required to effect the transactions contemplated by this Agreement, in each case where failure to obtain such consents, permissions and approvals would have a Material Adverse Effect on the Company or Wintrust’s rights under this Agreement.

6.14

6.11Effectiveness of the Registration StatementStatement.  . The Registration Statement shall have become effective with respect to the shares of Wintrust Common Stock to be issued in the Merger, no stop orders suspending the effectiveness of such Registration Statement shall have been issued, and no proceeding for that purpose shall have been instituted or threatened in writing.

6.15Other Documents. Wintrust shall have received at the Closing such other customary documents, certificates, or instruments as it may have reasonably requested evidencing compliance by the Company with the terms and conditions of this Agreement.

ARTICLE VII

CONDITIONS PRECEDENT TO OBLIGATIONS

OF THE COMPANY

Unless the conditions are waived by the Company, all obligations of the Company under this Agreement are subject to the fulfillment, on or before the Closing, of each of the following conditions:

7.1Representations and Warranties; Performance of Agreements. Each of the representations and warranties contained in ARTICLE III that are qualified by materiality shall be true and correct in all respects as of the Closing Date, and each of the representations and warranties contained in ARTICLE III that are not qualified by materiality shall be true and correct in all material respects, except to the extent such representations and warranties speak as of an earlier date, they shall be tested as of such earlier date. Wintrust shall have performed in all material respects all agreements herein required to be performed by Wintrust on or before the Closing.

7.2Closing Certificate. The Company shall have received a certificate signed by the Chief Executive Officer, a Senior Executive Vice President, an Executive Vice President, or a Senior Vice President of Wintrust dated as of the Closing Date, certifying in such detail as the Company may reasonably request, as to the fulfillment of the conditions to the obligations of the Company as set forth in this Agreement that are required to be fulfilled by Wintrust or Merger Co. on or before the Closing.

7.3Regulatory and Other Approvals. Wintrust shall have obtained the approval of all appropriate regulatory entities of the transactions contemplated by this Agreement and the Merger, all required regulatory waiting periods shall have expired, and there shall be pending on the Closing Date no motion for rehearing or appeal from such approval or any suit or action seeking to enjoin the Merger or to obtain substantial damages in respect of such transaction.

7.4Articles of Merger. The proper officers of Merger Co. shall have executed and delivered to the Company the Articles of Merger, in form suitable for filing with WDFI, and shall have executed and delivered all such other certificates, statements or instruments as may be necessary or appropriate to effect such a filing.

7.5No Litigation. No suit or other action shall have been instituted or threatened in writing seeking to enjoin the consummation of the Merger or to obtain other relief in connection with this Agreement or the transactions contemplated herein that the Company believes, in good faith and with the written advice of outside counsel, makes it inadvisable to consummate the Merger by reason of the probability that the proceeding would result in the issuance of an order enjoining the Merger or in a determination that Wintrust has failed to comply with applicable legal requirements of a material nature in connection with the Merger or actions preparatory thereto or would have a Material Adverse Effect on Wintrust.

7.6Opinions of Counsel.

(a) The Company shall have received the opinion of Schiff Hardin LLP, special counsel for Wintrust, dated as of the Closing Date, and in form substantially similar toExhibit E and reasonably satisfactory to the Company and its counsel.

(b) The Company shall have received the opinion of WIPFLI, LLP, accountants for the Company, dated as of the Closing Date, to the effect that the Merger will constitute a “reorganization” within the meaning of Section 368(a) of the Code, that the Company and Wintrust will each be a party to such reorganization within the meaning of Section 368(a) of the Code, and that no gain or loss will be recognized by the holders of shares of Company Common Stock upon the receipt of shares of Wintrust Common Stock in exchange for their shares of Company Common Stock, except to the extent of any cash consideration received in the Merger and any cash received in lieu of fractional shares of Wintrust Common Stock. The tax opinion shall be based on customary assumptions and supported by one or more fact certificates or affidavits from Wintrust and the Company, in such form and content as may reasonably be requested by counsel to the Company. Notwithstanding anything to the contrary contained herein, no Party may waive the conditions set forth in this Section 7.6(b).

7.7No Adverse Changes. Between the date of this Agreement and the Closing Date, there shall not have occurred any change or any condition, event, circumstance, fact or occurrence, other than as provided in this Agreement, that would have a Material Adverse Effect on Wintrust.

7.8Effectiveness of the Registration Statement. The Registration Statement shall have become effective with respect to the shares of Wintrust Common Stock to be issued in the Merger, no stop orders suspending the effectiveness of such Registration Statement shall have been issued, and no proceeding for that purpose shall have been instituted or threatened in writing.

7.96.12NASDAQ Listing.  Shares of Wintrust Common Stock to be issued in connection with the Merger shall have been approved for listing on NASDAQ, to the extent further approval is required.

6.13Other Documents.  Wintrust shall have received at the Closing such other customary documents, certificates, or instruments as it may have reasonably requested evidencing compliance by the Company with the terms and conditions of this Agreement.

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ARTICLE VII
CONDITIONS PRECEDENT TO OBLIGATIONS
OF THE COMPANY

All obligations of the Company under this Agreement are subject to the fulfillment or waiver, on or before the Closing, of each of the following conditions:

7.1Representations and Warranties; Performance of Agreements.  Each of the representations and warranties contained in ARTICLE III that are qualified by materiality shall be true and correct in all respects as of the Closing Date, and each of the representations and warranties contained in ARTICLE III that are not qualified by materiality shall be true and correct in all material respects, except to the extent such representations and warranties speak as of an earlier date, they shall be tested as of such earlier date.  Wintrust shall have performed in all material respects all agreements, covenants and undertakings herein required to be performed by Wintrust on or before the Closing.

7.2Certificates.  The Company shall have received from Wintrust each of the following:

(a)                                 a certificate signed by a senior executive officer of Wintrust, dated as of the Closing Date, to the effect that the conditions set forth in Section 7.1 of this Agreement have been satisfied; and

(b)                                 a certificate signed by a senior executive officer of Merger Co. certifying as of the Closing Date (i) a true and complete copy of the organizational documents of Merger Co.; (ii) true and complete copies of the resolutions authorizing the execution, delivery and performance by Merger Co. of this Agreement and the consummation of the transactions contemplated by this Agreement; and (iii) incumbency matters.

7.3Regulatory and Other Approvals.  Wintrust shall have obtained the approval of all appropriate regulatory entities of the transactions contemplated by this Agreement and the Merger, all required regulatory waiting periods shall have expired, and there shall be pending on the Closing Date no motion for rehearing or appeal from such approval or any suit or action seeking to enjoin the Merger or to obtain substantial damages in respect of such transaction.

7.4Articles of Merger.  The proper officers of Merger Co. shall have executed and delivered to the Company the Articles of Merger, in form suitable for filing with IL SOS, and shall have executed and delivered all such other certificates, statements or instruments as may be necessary or appropriate to effect such a filing.

7.5No Injunction.  No temporary restraining order, preliminary or permanent injunction or other order issued by a court of competent jurisdiction or other legal restraint or prohibition preventing the consummation of the Merger shall be in effect.

7.6Opinions of Counsel.

(a)                                 The Company shall have received the opinion of Schiff Hardin LLP, special counsel for Wintrust, dated as of the Closing Date, and in form substantially similar to Exhibit H and reasonably satisfactory to the Company and its counsel.

(b)                                 The Company shall have received the opinion of Barack Ferrazzano Kirschbaum & Nagelberg LLP, counsel for the Company, dated as of the Closing Date, to the effect that

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the Merger will constitute a “reorganization” within the meaning of Section 368(a) of the Code, that the Company and Wintrust will each be a party to such reorganization within the meaning of Section 368(b) of the Code, and that no gain or loss will be recognized by the holders of shares of Company Common Stock upon the receipt of shares of Wintrust Common Stock in exchange for their shares of Company Common Stock, except to the extent of any cash consideration received in the Merger and any cash received in lieu of fractional shares of Wintrust Common Stock.  The tax opinion shall be based on customary assumptions and supported by one or more fact certificates or affidavits from Wintrust and the Company in such form and content as may reasonably be requested by counsel to the Company.  Notwithstanding anything to the contrary contained herein, no Party may waive the conditions set forth in this Section 7.6(b).

7.7No Adverse Changes.  Between the date of this Agreement and the Closing Date, there shall not have occurred any change or any condition, event, circumstance, fact or occurrence, other than as provided in this Agreement, which would have a Material Adverse Effect on Wintrust.

7.8Effectiveness of the Registration Statement.  The Registration Statement shall have become effective with respect to the shares of Wintrust Common Stock to be issued in the Merger, no stop orders suspending the effectiveness of such Registration Statement shall have been issued, and no proceeding for that purpose shall have been instituted or threatened in writing.

7.9NASDAQ Global Select Market.Listing.  Shares of Wintrust Common Stock to be issued in connection with the Merger shall have been approved for listing on NASDAQ, to the extent further approval is required.

7.10Assignment Agreement.  The Bank, Shareholders’ Representative, Merger Sub and Wintrust shall have executed and delivered that certain Assignment Agreement in the form substantially similar to Exhibit I (the “Assignment Agreement”) and reasonably satisfactory to the Company and Wintrust, to assign to Shareholders’ Representative all rights, interests, insurance, judgments, and amounts received in settlement, and for Shareholders’ Representative to assume all liabilities and other obligations related to the Customer Litigation.

7.11Other Documents.  The Company shall have received at the Closing all such other customary documents, certificates, or instruments as they may have reasonably requested evidencing compliance by Wintrust with the terms and conditions of this Agreement.

ARTICLE VIII
INDEMNIFICATION

SURVIVAL; INDEMNIFICATION

8.1Survival of Representations, Warranties, and Covenants..  All representations and warranties made by the parties hereto shall survive until the last day of the fifteenth (15th)15th calendar month following the month in which the Closing Date occurs, and shall thereafter expire.  All covenants and agreements which by their terms are applicable in whole or in part following the Effective Time shall survive the Closing in accordance with such terms.  Any investigation by a party to be indemnified on account of any breach or incorrectness of such statements, representations, warranties or agreements shall not be a defense to a claim for indemnification.

8.2Indemnification.

8.2Indemnification.

(a) The Company agrees that                                 Wintrust and each of its subsidiaries (including the Surviving Corporation) and affiliates (the “Wintrust Indemnified Parties”) shall be indemnified by the Company against and held harmless from and against (i) any and all losses, liabilities, claims,

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causes of actions, suits, damages or penalties (excluding punitive damages and special damages (other than punitive or special damages claimed by third parties) and damages solely attributable to lost profits) (“Claims”) relating to, arising out of or resulting from (A) any breach or incorrectness of any of the representations and warranties contained in ARTICLE II of this Agreement (including the Company Schedules thereto) or in any certificates delivered to Wintrust by the Company or with their express authorization, or (B) any breach of any covenant or agreement made by the Company in this Agreement, or (C) the Customer Litigation and any action taken or decision made by Shareholders’ Representative in connection therewith, and (ii) the reasonable out-of-pocket expenses or costs incurred by the Wintrust Indemnified Parties, including reasonable attorneys’ fees, in connection with investigating, attempting to correct or defending against any claims, liens or charges that are asserted against the Wintrust Indemnified Parties for which any of the Wintrust Indemnified Parties is entitled to indemnity pursuant to the foregoing provisions.

  Except as otherwise specified below or as expressly set forth in the Assignment Agreement, the foregoing indemnity obligations shall be satisfied against the Escrow Amount pursuant to the procedures set forth below and specified in the Escrow Agreement.  To the extent a Claim arises out of or results from a breach or incorrectness of a representation or warranty of the Company, such Claim may not be eligible to be satisfied against the Escrow Amount unless such Claim has been asserted by a written notice given to Shareholders’ Representative on or before the expiration of such representation or warranty.

(b)                                 Wintrust shall indemnify the holders of the Company Common Stock as of immediately prior to the Effective Time (the “Company Indemnified Parties”) against and hold them harmless from (i) any and all Claims arising out of or resulting from (A) any breach or incorrectness of any of the representations and warranties contained in ARTICLE III or in any certificates delivered to the Company by Wintrust or with its express authorization, or (B) any breach of any covenant or agreement made by Wintrust or Merger Co. in this Agreement, and (ii) the reasonable out-of-pocket expenses or costs incurred by the Company Indemnified Parties, including reasonable attorneys’ fees, in connection with investigating, attempting to correct or defending against any claims, liens or charges that are asserted against the Company’s shareholders for which they are entitled to indemnity pursuant to the foregoing provisions.  To the extent a Claim arises out of or results from a breach or incorrectness of a representation or warranty of Wintrust, or Merger Co., Wintrust shall not be liable under this Section 8.2(b) unless such Claim has been asserted by a written notice which is given to Wintrust on or before the expiration of such statement, representation or warranty.

(c)                                  In the event a Claim results in a reduction in the amount of federal, state or foreign income taxes payable by the indemnified party by reason of any deduction or adjustment allowed such party as a result of the payment, settlement or satisfaction of such Claim, or in the event the indemnified party receives any other monetary benefit (by way of counterclaim, set-off or otherwise) as a result of a judgment, compromise or settlement of a Claim and such monetary benefit arises out of the same transaction or occurrence that is the subject matter of such Claim, the indemnifying party’s indemnification obligation shall be net of the amount of such tax or monetary benefit, provided such tax or monetary benefit is sufficient to compensate the indemnified party for any additional income taxes payable by the indemnified party as a result of any indemnification payments hereunder.

(d)                                 Notwithstanding anything to the contrary contained in this Section 8.2:

(i)                         no indemnified party shall be entitled to indemnification under clause (i)(A) of Section 8.2(a) (in the case of the Wintrust Indemnified Parties) or clause (i)(A) of Section 8.2(b) (in the case of the Company Indemnified Parties) until the aggregate amount of liability suffered by the indemnified parties with respect to which they are entitled to indemnification under the applicable clause (i)(A) exceeds $250,000, whereupon$200,000 (the “Basket Amount”), at which point the applicable indemnified parties shall be entitled to indemnification hereunder for the aggregate of all liabilities suffered;provided,however, that such limitation shall not applysuffered, including those comprising the Basket Amount;

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(ii)                                  pursuant to the obligationsCompany Shareholder Approval, by executing and delivering their respective letters of transmittal in accordance with this Agreement, each holder of Company Common Stock Outstanding shall have evidenced his, her or its express acceptance of the Companyobligations to indemnify the Wintrust Indemnified Parties for any breachunder Section 8.2(a), subject to the limitations set forth in this Section 8.2(d), and further subject to the provisions of any ofthis ARTICLE VIII, including Section 8.5.

(iii)                               except as expressly set forth in the representations and warranties made by the Company in Section 2.1 (Organization), Section 2.3 (Capitalization), Section 2.4 (Authorization; No Violation), Section 2.16 (Taxes), Section 2.17 (Environmental Laws and Regulations), Section 2.21 (Employee Benefit Plans), Section 2.26 (Brokers’ and Finders’ Fees) and Section 2.28 (No Omissions) (collectively, the “Fundamental Representations”);

(ii)Assignment Agreement, the aggregate amount by which the Wintrust Indemnified Parties may be indemnified pursuant to Section 8.28.2(a) shall not exceed $1,000,000;an amount equal to the Escrow Amount;

(iii)

(iv)                              the aggregate obligation of Wintrust to indemnify the Company Indemnified Parties pursuant to this Section 8.28.2(b) shall not exceed $1,000,000;an amount equal to the Escrow Amount; and

(iv)

(v)                                 the indemnified party shall use commercially reasonable efforts to mitigate any Claims and obtain or realize any insurance proceeds or tax deductions or tax benefits with respect to such Claims.

8.3Indemnification ProcedureIndemnification Procedure..  A party seeking indemnification (which in the case of the shareholders of the Company seeking indemnification shall be the Shareholders’ AgentRepresentative acting on their behalf) shall assert a claim for indemnification under Section 8.2 by giving prompt notice in writing to the indemnifying party of the facts and circumstances giving rise to such Claim.  Subject to the limitations of any contract of insurance, an indemnified party shall tender to the indemnifying parties the opportunity to manage and control any defense against any such Claim with counsel chosen by the indemnifying party, subject to the indemnified party’s approval of such counsel (which approval shall not be withheld unreasonably) and to such other conditions as the indemnified party reasonably determines in good faith to be necessary for the protection of its interests.  If the indemnifying party assumes management and control of such defense, the indemnified parties shall cooperate reasonably with the indemnifying parties in the conduct of any such defense, and the indemnifying party shall have full rights to negotiate and enter into any compromise or settlement which is dispositive of such Claim, provided that any

compromise or settlement that will not be paid in full by the indemnifying party or that involves any remedy other than the payment of money damages shall be subject to the consent of the indemnified party.  The indemnified parties shall be entitled to participate in the defense of such action at their own expense.  In the event the indemnifying party fails to accept the management and control of such defense in a timely manner, the indemnified parties shall have the right to choose counsel and to assume management and control of the defense at the indemnifying parties’ expense, and the indemnifying party shall be entitled to participate in such defense at its own expense.

8.4Appointment of Shareholders’ Agent. The decisions of the shareholders of the Company with respect to taking any and all actions specified or contemplated by this ARTICLE VIII shall be determined by an executive officer of the Company to be nominated at the Shareholders’ Meeting, who upon the requisite approval by the Company’s shareholders at the Shareholders Meeting’ shall be constituted and appointed as the shareholders’ exclusive agent and attorney-in-fact in connection with the foregoing (“Shareholders’ Agent”). The Company Board shall cause the appointment of the Shareholders’ Agent, together with an alternate to serve as successor if the initial Shareholders’ Agent should become unable or unwilling to perform his or her duties, at the Shareholders’ Meeting to constitute the authorization by each shareholder of the Company, without regard to whether such shareholder voted to appoint the Shareholders’ Agent, that the powers granted to the Shareholders’ Agent are coupled with an interest and shall be irrevocable and that Shareholders’ Agent shall be fully protected, held harmless and indemnified by the Company’s shareholders in exercising, or in declining to exercise, a power provided for or contemplated by this Agreement for the benefit of all shareholders, as he or she shall determine, whether upon consultation with the shareholders or in his or her sole discretion, to be in the interests of all shareholders of the Company. The actions of the Shareholders’ Agent pursuant to this Agreement shall bind each shareholder of the Company, and no notice to or approval by the shareholders of such action shall be required. Wintrust shall be entitled to rely on any action taken by the Shareholders’ Agent as may be contemplated by this Agreement and on any certificate or instrument related thereto provided by the Shareholders’ Agent in his or her capacity as agent for the shareholders of the Company, for the benefit of all shareholders of the Company, and shall have no duty to inquire into the circumstances in which any such action is taken or such written instrument is provided. In the event the successor Shareholders’ Agent appointed at the Shareholders’ Meeting should become unable to unwilling to perform his or her duties, and unable or unwilling to appoint a subsequent successor, then Wintrust shall appoint any reasonable successor Shareholders’ Agent from among the Shareholders or former officers of the Company. Any successor Shareholders’ Agent so appointed shall be vested with the same power and authority as the initial Shareholders’ Agent.

8.58.4Adjustment to Merger Consideration.  All amounts paid with respect to Claims under this Agreement shall be treated by the Parties for all Tax purposes as adjustments to the Merger Consideration.

8.6

8.5Sole and ExclusiveExclusive Remedy.  Except as set forth in Section 9.1 or for claims based upon fraud or willful misconduct, the indemnification provisions of this ARTICLE VIII shall constitute the sole and exclusive remedy of the Wintrust Indemnified Parties and the shareholders of the Company Indemnified Parties for any breach of representations or warranties or covenants under this Agreement.

8.7Arbitration.

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8.6Arbitration.

(a)                                 Any dispute, claim or controversy arising out of or relating to this Article VIII or the breach, termination, enforcement, interpretation or validity thereof, including the determination of the scope or applicability of this agreement to arbitrate, shall be resolved by arbitration in Madison, Wisconsin,Chicago, Illinois, before one arbitrator who is an attorney.  The arbitration shall be administered by the Madison, Wisconsin,Chicago, Illinois, office of the American Arbitration Association (“AAA”) pursuant to this Section 8.7,8.6, the AAA Commercial Arbitration Rules and the Federal Arbitration Act.  In the event of a conflict, this Section 8.7 shall govern.  The Parties agree that the arbitrator shall have the power to provide any relief available at law or in equity under the laws of the State of Wisconsin.Illinois.  The arbitrator shall issue a reasoned award to the Parties deciding the issues in dispute within thirty (30)30 days of the evidentiary hearing, or, if no such hearing is held, within thirty (30)30 days of receiving all of the Parties’ submissions.  Judgment on the award may be entered in any court that may properly assert jurisdiction over the Parties against which judgment will be enforced.

(b)                                 The arbitrator shall, in the award, allocate the costs of the arbitration, including the fees of the arbitrator and the reasonable attorneys’ fees of the Prevailing Party against the non-prevailing party.  The “Prevailing Party,” as it is used in this Section 8.7, shall be determined by the arbitrator, who shall consider, among other things, the good faith of the Parties, the party that prevails on the majority of the claims and counterclaims before the arbitrator and the monetary value of the claims or counterclaims decided by the arbitrator.

ARTICLE IX
GENERAL

GENERAL

9.1Termination Fees; ExpensesExpenses.  . Except as otherwise provided in this Section 9.1, all costs and expenses incurred in the consummation of this transaction, including any brokers’ or finders’ fees, shall be paid by the Party incurring such cost or expense.

(a)                                 In the event that this Agreement is terminated by Wintrust because the Company committed a material breach of its material obligations under this Agreement (except in circumstances governed by Section 9.1(b) below), unless such breach is a result of the failure by Wintrust to perform and comply in all material respects with any of its material obligations under this Agreement which are to be performed or complied with by it prior to or on the date of such termination, then, provided Wintrust is in material compliance with all of its material obligations under this Agreement, the Company shall pay to Wintrust a termination fee of $750,000, plus documented$1,000,000, which amount is inclusive of any out-of-pocket expenses and costs, (up to a maximum of an additional $250,000 in such expenses and costs), including reasonable attorneys’ fees, subject to verification thereof, that Wintrust (i) has incurred in furtherance of this Agreement and the transactions contemplated herein and (ii) is reasonably expected to incur as a result of the Company’s breach of this Agreement, including, but not limited to, reasonable fees of professionals engaged for such purpose by or on behalf of Wintrust.fees.  Except as provided in the following sentence, and in Section 9.1(c), such sums shall constitute liquidated damages and the receipt thereof shall be Wintrust’s sole and exclusive remedy under this Agreement. Notwithstanding the foregoing, if this Agreement is terminated by Wintrust as a result of the Company’s willful breach of this Agreement (other than a breach of the covenant contained in Section 4.8, which is the subject of Section 9.1(b)(i) below), then in addition to recovery of its out-of-pocket expenses and costs, Wintrust shall be entitled to recover such other amounts, including consequential damages, as it may be entitled to receive at law or in equity.

(b)                                 In the event that:

(i)                                     Wintrust terminates this Agreement pursuant to Section 9.2(c)(i) by virtue of a breach of the covenant contained in Section 4.8 or pursuant to Section 9.2(f), 9.2(g)(i), or 9.2(g)(ii);

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(ii)                                  the Company terminates this Agreement pursuant to Section 9.2(f); or

(iii)                               any Person makes a Company Takeover Proposal that was publicly disclosed before the Shareholders’ Meeting and thereafter this Agreement is terminated (i) by Wintrust as a result of a breach by the Company of its covenant in Section 4.8, (ii) by the Company pursuant to Section 9.2(e)9.2(b), or (iii)by Wintrust pursuant to Section 9.2(b)9.2(c) or 9.2(c) by either Wintrust or the Company pursuant to Section 9.2(e),

and (in the casewithin 18 months of this clause (iii)) within six months after the date ofany such termination the Company orconsummates the Bank has either consummated or entered intotransactions contemplated by a definitive agreement relating to an AcquisitionCompany Takeover Proposal, which was made known to any member of the Company Board or the boards of directors of the Bank and not disclosed to Wintrust prior to the date of such termination, then the Company shall pay to Wintrust a termination fee equal to $1,250,000, plus$2,000,000.  In addition, in such circumstances or in other circumstances in which this Agreement is terminated pursuant to Section 9.2(e), the Company shall pay to Wintrust its documented out-of-pocket expenses and costs (up to a maximum of an additional $250,000 in such costs and expenses) including reasonable attorneys’ fees, subject to verification thereof, that Wintrust (i) has incurred in furtherance of this Agreement and the transactions contemplated herein and (ii) is reasonably expected to incur as a result of the Company’s conduct described in this clause (b) above,, including reasonable fees of professionals engaged for such purpose by or on behalf of Wintrust.  Except as otherwise provided in Section (a)the last two sentences of Sections 9.1(a) and 9.1(c), such sums shall constitute liquidated damages and the receipt thereof shall be Wintrust’s sole and exclusive remedy under this Agreement;providedAgreement, it being understood that in no event shall Wintrust be entitled to a termination fee under both Sections 9.1(a) and 9.1(b) and including reasonable attorneys’ fees..

(c)                                  In the event that this Agreement is terminated by the Company because Wintrust committed a material breach of its material obligations under this Agreement, unless such breach is a result of the failure by the Company or the Bank to perform and comply in all material respects with any of its material obligations under this Agreement which are to be performed or complied with by it prior to or on the date of such termination, then, provided the Company is in material compliance with all of its material obligations under this Agreement, Wintrust shall pay the Company a termination fee of $750,000, plus documented$1,000,000, which amount is inclusive of any out-of-pocket expenses and costs, (up to a maximum of an additional $250,000including attorneys’ fees. Except as provided in such expenses and costs), including reasonable attorneys’ fees, subject to verification thereof, that the Company (i) has incurred in furtherance of this Agreement and the transactions contemplated herein and (ii) is reasonably expected to incur as a result of Wintrust’s breach of this Agreement, including, but not limited to, reasonable fees of professionals engaged for such purpose by or on behalf of the Company;provided,however, thatfollowing sentence, such sums shall constitute liquidated damages and the receipt thereof shall be the Company’s sole and exclusive remedy under this Agreement.  Notwithstanding the foregoing, if

this Agreement is terminated by the Company as a result of Wintrust’s willful breach of this Agreement, then in addition to recovery of its out-of-pocket expenses and costs, the Company shall be entitled to recover such other amounts, including consequential damages, as it may be entitled to receive at law or in equity.

(d)                                 Any fee or expense payment due under this Section 9.1 shall be paid by wire transfer to the applicable account specified in Schedule 9.1(d) of same-day funds on the date of termination of this Agreement, except that in the case of a fee payable pursuant to Section 9.1(b)(ii), such payment shall be made on the date of execution of such definitive agreement, or such approval or recommendation, or, if earlier, consummation of such transactions.

9.2TerminationTermination..  This Agreement may be terminated:

(a)                                 at any time by written agreement between Wintrust and the Company;

(b)                                 by either Wintrust or the Company if the Closing has not occurred (other than through the failure of any Party seeking to terminate this Agreement to comply fully with its material obligations under this Agreement) by January 31, 2015 (the “Termination Date”),February 29, 2020, or such later date agreed to by the Parties,provided,however, that the Termination Datesuch termination date shall automatically be extended until MarchMay 31, 2015,2020, if the sole impediment to Closing is a delay in the approval of the Federal Reserve Application or the Wisconsin Application;

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(c)                                  by Wintrust by written notice to the Company, (i) if the Company shall have breachedbreaches or fails to perform in any representation, warranty, covenant, obligationmaterial respect any of its representations, warranties or other agreementcovenants contained in this Agreement that (i)or any agreement contemplated hereby, which breach or failure to perform (x) would result ingive rise to the failure of a condition set forth in ARTICLE VI to be satisfied, (ii)Section 6.1 and (y) cannot be or has not been cured prior to the earlier to occur of (x)within 30 days after the giving of written notice to the Company of such breach (provided that Wintrust is not then in material breach of any representation, warranty or (y)covenant contained in this Agreement or any Ancillary Agreement) or (ii) if satisfaction of such a condition is or becomes impossible (other than through the Termination Date,failure of Wintrust or Merger Co. to comply with its obligations under this Agreement); and, (iii)in each case, Wintrust has not waived such condition on or before the Closing Date;

(d)                                 by the Company by written notice to Wintrust, (i) if (i)Wintrust breaches or fails to perform in any material respect any of its representations, warranties or covenants contained in this Agreement or any agreement contemplated hereby, which breach or failure to perform (x) would give rise to the conditionsfailure of a condition set forth in ARTICLE VIISection 7.1 and (y) cannot be or has not been satisfied ascured within 30 days after the giving of written notice to Wintrust of such breach (provided that the Closing DateCompany is not then in material breach of any representation, warranty or covenant contained in this Agreement or any Ancillary Agreement) or (ii) if satisfaction of such a condition is or becomes impossible (other than through the failure of the Company or the Bank to comply with its obligations under this Agreement); and, (ii)in each case, the Company has not waived such condition on or before the Closing Date;

(e)                                  by the Company pursuant to Section 4.8(b),either Wintrust or by Wintrust if an Acquisition Proposal from a third party is accepted by the Company or consummated, in each case by written notice to the other party; or

(f) by the Company, if, upon a vote at a duly held meeting to obtain the time allCompany Shareholder Approval, the Company Shareholder Approval is not obtained;

(f)                                   by either Wintrust or the Company, if the Company enters into a definitive agreement related to a Superior Company Proposal; or

(g)                                  by Wintrust:

(i)                                     if the Company Board or any committee thereof withdraws or modifies, in a manner adverse to Wintrust or Merger Co. or proposes publicly to withdraw or modify, in a manner adverse to Wintrust or Merger Co., its approval or recommendation of this Agreement or the conditionsMerger, fails to recommend to the Closing set forth in ARTICLE VI and ARTICLE VII are satisfied, the Wintrust Common Stock Price is less than $36.50;provided,however,Company’s shareholders that they give the Company may not terminateShareholder Approval or approves or recommends, or proposes publicly to approve or recommend, any Company Takeover Proposal (other than the Agreement pursuanttransactions contemplated by this Agreement);

(ii)                                  if the Company Board fails to this Section 9.2(f) unless and until five (5) business days have elapsed following the receipt by Wintrust of written notice ofreaffirm its recommendation to the Company’s intentshareholders that they give the Company Shareholder Approval within ten days of Wintrust’s written request to terminate, and prior to the end of such five (5) business-day period the Parties in good faith are unable to reach agreement as to an amendment to this Agreement containing terms acceptable to both Partiesdo so that the Merger and transactions contemplated hereby(which request may be effected;made at any time following public disclosure of a Company Takeover Proposal); or

(g)

(iii)                               if any temporary restraining order, preliminary or permanent injunction or other order issued by Wintrust, if atany court of competent jurisdiction or other legal restraint or prohibition prevents the time allenforcement of the conditions to the Closing set forth in ARTICLE VI and ARTICLE VII are satisfied, the Wintrust Common Stock Price is more than $52.50;provided,however, that Wintrust may not terminate the Agreement pursuant to this Section 9.2(g) unless and until five (5) business days have elapsed following the receipt by the Company of written notice of Wintrust’s intent to terminate, and prior to the end of such five (5) business-day period the Parties in good faith are unable to reach agreement as to an amendment to this Agreement containing terms acceptable to both Parties so that the Merger and transactions contemplated hereby may be effected.4.8 or Section 9.1.

Any termination of this Agreement shall not affect any rights accrued prior to such termination.termination (except to the extent expressly provided in Section 9.1).

9.3Confidential Information.  The Parties each covenant that, in the event the transactions contemplated by this Agreement are not consummated, each Party will keep in strict confidence and either return or destroy (and certify in writing as to such destruction) all documents containing any information concerning the properties, business, and assets of the other Parties that may

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have been obtained in the course of negotiations or examination of the affairs of the other Parties either prior or subsequent to the execution of this Agreement (other than such information as shall be in the public domain or otherwise ascertainable from public or outside sources), except to the extent that disclosure is required by judicial process or governmental or regulatory authorities or to the extent that retention of such documents is required by applicable laws, rules or regulations governing record retention.

  The obligations of the Parties under this Section 9.3 shall survive in accordance with its terms, irrespective of the survival periods set forth in Section 8.1.

9.4Non-Assignment.  Neither this Agreement nor any of the rights, interests or obligations of the Parties under this Agreement shall be assigned by any Party (whether by operation of law or otherwise) without the prior written consent of the other Parties.  Notwithstanding the foregoing, Wintrust may assign its rights hereunder to another wholly owned subsidiary of Wintrust.Wintrust, provided that no such assignment shall relieve Wintrust of its obligations hereunder.  Subject to the foregoing, this Agreement shall be binding upon and inure to the benefit of the respective successors and assigns of the Parties.

9.5NoticesNotices..  All notices, requests, demands, and other communications provided for in this Agreement shall be in writing and shall be deemed to have been given (a) when delivered in person, (b) the third (3rd) business day after being deposited in the United States mail, registered or certified mail (return receipt requested), (c) the first business day after being deposited with Federal Express or any other recognized national overnight courier service, or (d) if delivered to the applicable electronic mail (e-mail) address set forth below, upon confirmed transmission by facsimile transmission, upon receipt,sender to such email address, in each case addressed as follows or at such other address as provided by a Party to the other Parties in accordance with these procedures:

 

(i)If to the Company or the Bank, addressed to:

Delavan(i)                                     If to the Company or the Bank, addressed to:

STC Bancshares Inc.Corp.

820 Geneva Street
Delavan, Wisconsin 53115
Attention:Michael J. Murphy
President/CEO

460 South 1st Street

St. Charles, Illinois 60174

E-mail:                                                        TSisto@stccapitalbank.com

Attention:                                         Anthony V. Sisto

Chairman

with a copy to:

 

Boardman & Clark LLP
1 South Pinckney Street, Suite 410
Madison, Wisconsin 53703
Attention:John Knight, Esq.

Barack Ferrazzano Kirschbaum & Nagelberg LLP

200 W. Madison St. Suite 3900

Chicago, Illinois 60606

E-mail:                                                        dennis.wendte@bfkn.com

Attention:                                         Dennis R. Wendte, Esq.

 

(ii)If to Wintrust or Merger Co., addressed to:

(ii)                                  If to Wintrust or Merger Co., addressed to:

 

Wintrust Financial Corporation
9700 W. Higgins Road, Suite 800
Rosemont, Illinois 60018
Facsimile: 877-873-5406
Attention:Lisa J. Pattis, Esq.
Executive Vice President and
General Counsel

Wintrust Financial Corporation

9700 W. Higgins Road, Suite 800

Rosemont, Illinois 60018

E-mail:        kboege@wintrust.com

Attention:                                         Kathleen M. Boege

Executive Vice President and General Counsel

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with a copy to:to:

 

Schiff Hardin LLP
233 S. Wacker Drive, Suite 6600
Chicago, Illinois 60606-6473
Facsimile:312-258-5600
Attention:Matthew G. Galo, Esq.

Schiff Hardin LLP

233 S. Wacker Drive, Suite 7100

Chicago, Illinois 60606-6473

E-mail                                                            mgalo@schiffhardin.com

Attention:                                         Matthew G. Galo, Esq.

(ii)                                  If to Shareholders’ Representative, addressed to:

Anthony V. Sisto

E-mail:

9.6Counterparts.  For the convenience of the Parties, this Agreement may be executed in any number of separate counterparts, each such counterpart being deemed to be an original instrument, and all such counterparts will together constitute the same agreement.  Executed signature pages to this Agreement may be delivered by facsimile or other electronic means and such signature pages will be deemed as sufficient as if actual signatures pages had been delivered.

9.7Knowledge.  References in this Agreement to the “knowledge” of a party shall mean: (a) with respect to a natural person, the actual knowledge of such person after his or her reasonable investigation into the subject matter at issue; (b) with respect to the Company, the Bank, and the Bank Subsidiary, the actual knowledge of Michael J. Murphy,Anthony V. Sisto, Chief Executive Officer, Christopher D. Woelffer, President, and CEO, and Jon Martin, CFO,Thomas Spoden, Executive Vice President, after their reasonable investigation into the subject matter at issue, and (c) with respect to Wintrust, the actual knowledge of David A. Dykstra, Senior Executive Vice President and Chief Operating Officer, Richard B. Murphy, Executive Vice President and Chief Credit Officer, David L. Stoehr,and Tim Crane, Executive Vice President and Chief Financial Officer, or Leona A. Gleason, Executive Vice President and Chief Administrative OfficerTreasurer, after their reasonable investigation into the subject matter at issue.

9.8Interpretation.  The words “hereof,” “herein” and “herewith” and words of similar import shall, unless otherwise stated, be construed to refer to this Agreement as a whole.  Article, Section, Exhibit and Schedule references are to the Articles, Sections, Exhibits and Schedules of this Agreement unless otherwise specified.  The table of contents and headings contained in this Agreement are for reference purposes only and will not affect in any way the meaning or interpretation of this Agreement.  Whenever the words “include,” “includes,” “including” or similar expressions are used in this Agreement, they will be understood to be followed by the words “without limitation.”  The term “business day” shall mean a day other than a Saturday or a Sunday on which banking institutions are required to be open for business in the State of Illinois.  The words describing the singular shall include the plural and vice versa, and words denoting any gender shall include all genders and words denoting natural persons shall include corporations, partnerships and other entities and vice versa.  The parties have participated jointly in the negotiation and drafting of this Agreement.  In the event of an ambiguity or question of intent or interpretation arises, this Agreement will be construed as if drafted jointly by the Parties and no presumption or burden of proof will arise favoring or disfavoring any Party by virtue of the authorship of any provision of this Agreement.

9.9Entire AgreementAgreement; No Third Party Beneficiaries..  This Agreement, including the Schedules and agreements delivered pursuant hereto, and the Confidentiality Agreement, set forth the entire understanding of the Parties, and supersedes all prior agreements, arrangements, and communications, whether oral or written.written, and is not intended to confer upon any person other than the parties any rights or

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remedies.  Notwithstanding the foregoing, following the Effective Time, the provisions of Article I shall be enforceable by holders of Company Stock Certificates.  This Agreement may be amended by the parties at any time before or after receipt of the Company Shareholder Approval; provided, however, that after receipt of the Company Shareholder Approval, there shall be made no amendment that by law requires further approval by the shareholders of the Company without the further approval of such shareholders.  This Agreement shall not be modified or amended other than by written agreement of the Parties.  Captions appearing in this Agreement are for convenience only and shall not be deemed to explain, limit, or amplify the provisions hereof.

9.10Extension; Waiver.  At any time before the Effective Time, the Parties may (a) extend the time for the performance of any of the obligations or other acts of the other Parties, (b) waive any inaccuracies in the representations and warranties contained in this Agreement or in any document delivered pursuant to this Agreement or (c) waive compliance with any of the agreements or conditions contained in this Agreement; provided, however, that after receipt of the Company Shareholder Approval, there shall be made no waiver that by law requires further approval by the shareholders of the Company without the further approval of such shareholders.  Any agreement on the part of a Party to any such extension or waiver shall be valid only if set forth in an instrument in writing signed on behalf of such Party.  The failure of any Party to this Agreement to assert any of its rights under this Agreement or otherwise shall not constitute a waiver of such rights.  For any matter under this Agreement requiring the consent or approval of any Party, such consent or approval shall be valid and binding on a party hereto only if such consent or approval is delivered in an instrument in writing signed on behalf of such Party.

9.11Governing Law.  This Agreement shall be governed by and construed in accordance with the laws of the State of Wisconsin,Illinois, without giving effect to the conflicts of laws principles thereof.  Each of the Parties (a) consents to submit itself to the personal jurisdiction of any Illinois state court located in Chicago, Illinois or any Federal court located in Chicago, Illinois (or any court with appellate jurisdiction therefrom) in the event any dispute arises out of this Agreement or the transactions contemplated hereby, (b) agrees that it will not attempt to deny or defeat such personal jurisdiction by motion or other request for leave from any such court, (c) agrees that it will not bring any action relating to this Agreement or the transactions contemplated hereby in any court other than any Illinois state court located in Chicago, Illinois or any Federal court sitting in the State of Illinois and (d) waives any right to trial by jury with respect to any action related to or arising out of this Agreement or the transactions contemplated hereby.

9.11

9.12Severability.  In the event that a court of competent jurisdiction shall finally determine that any provision of this Agreement or any portion thereof is unlawful or unenforceable, such provision or portion thereof shall be deemed to be severed from this Agreement, and every other provision and portion thereof that is not invalidated by such determination shall remain in full force and effect.  To the extent that a provision is deemed unenforceable by virtue of its scope but may be made enforceable by limitation thereof, such provision shall be enforceable to the fullest extent permitted under the laws and public policies of the state whose laws are deemed to govern enforceability.

9.13Limited Waiver of Privilege.  The Parties agree that the Company, its Representatives and its shareholders retain, own and do not hereby sell or transfer any attorney-client privilege regarding their communications with the Company’s counsel, Barack Ferrazzano Kirschbaum & Nagelberg LLP, primarily related to the negotiation of the Merger, this Agreement or the transactions contemplated hereby occurring prior to the Closing.  Each of Wintrust and Merger Co. understands and agrees that it waives any right to assert the ownership of the attorney-client privilege for any communications made prior to the Closing between the Company, its Representatives or its Shareholders, on the one hand, and the Company’s counsel, Barack Ferrazzano Kirschbaum & Nagelberg LLP, on the

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other hand, primarily related to the negotiation of the Merger, this Agreement or the transactions contemplated hereby.

** Signature Page Follows **

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IN WITNESS WHEREOF, Wintrust, the Company and Merger Co. have each executed this Agreement and Plan of Merger as of the day and year first written above.

 

WINTRUST FINANCIAL CORPORATION

By:

By:

/s/ David A. Dykstra

Name:

Name:

David A. Dykstra

Title:

Title:

Senior Executive Vice President and COO

DELAVAN

STC BANCSHARES Inc.CORP.

By:

By:

/s/ Michael J. MurphyAnthony V. Sisto

Name:

Name:

Michael J. Murphy

Anthony V. Sisto

Title:

Title:

President

Chairman

WINTRUST

WTFC STCBC MERGER CO.SUB LLC

By:

By:

/s/ David A. Dykstra

Name:

Name:

David A. Dykstra

Title:

Title:

Senior Executive Vice President

Manager

Exhibit B

Form of Option Conversion Agreement

DELAVAN BANCSHARES, INC.

The Delavan Bancshares, Inc. 2004 Executive Stock Option Plan

CONVERSION AGREEMENT

THIS CONVERSION AGREEMENT, made and entered into as of             , 2014 (this “Conversion Agreement”), by and between Delavan Bancshares, Inc., a Wisconsin corporation (the “Company”), and the undersigned optionee (“Optionee”) under the Delavan Bancshares, Inc. 2004 Executive Stock Option Plan (the “Plan”), and Wintrust Financial Corporation, an Illinois corporation (“Wintrust”) amends each Option Agreement evidencing a stock option (an “Option”) heretofore granted[Signature Page to the Optionee under the Plan and listed on the Optionee Summary attached hereto asExhibit A (the “Optionee Summary”), as follows:

1.Conversion of Option. Upon the Effective Time (as defined in the Merger Agreement described below) of that certain merger of the Company with and into Wintrust Merger Co., a Wisconsin corporation pursuant to that certain Agreement and Plan of Merger dated as of             , 2014, by and among Wintrust, Wintrust Merger Co., and the Company (the “Merger Agreement”), each outstanding Option listed on the Optionee Summary shall be amended such that the common stock to which such Option relates shall be the common stock, no par value per share, of Wintrust (“Wintrust Common Stock”).

2.Wintrust Option.

(a) The number of shares of Wintrust Common Stock to which each such amended Option shall relate shall be equal to the product (which shall be rounded down, if necessary, to the nearest whole share) of (i) the number of shares of Company Common Stock (as defined in the Merger Agreement) covered by the Option listed in the Optionee Summary (to the extent not theretofore exercised or terminated prior to the Effective Time), multiplied by (ii) the quotient of (1) the Per Share Merger Consideration (as defined in the Merger Agreement) divided by (2) the Wintrust Common Stock Price (as defined in the Merger Agreement).

(b) The exercise price per share of Wintrust Common Stock under each such Converted Option (as defined in the Merger Agreement) shall be equal to the quotient (which shall be rounded up, if necessary, to the nearest whole cent) obtained by dividing (i) the exercise price per share of Company Common Stock under the original Option by (ii) the quotient of (1) the Per Share Merger Consideration divided by (2) the Wintrust Common Stock Price.

3.Exercisability. The Wintrust Option shall be exercisable in full at any time during the period beginning on the Effective Time and ending on the expiration date(s) set forth in the option agreement (and the Plan) for each respective Option set forth on the Optionee Summary by Optionee’s giving notice to the Company or its successor in the manner specified in the option agreement. Optionee acknowledges to the extent the Option is an incentive stock option under Code Section 422 (an “ISO”), if Optionee exercises the Option more than three months after Optionee ceases to be an employee, then the Option will not qualify for ISO treatment.

4.Notification of Disposition; Taxes. Optionee shall promptly notify Wintrust in the event that Optionee disposes of any shares of Wintrust Common Stock purchased upon exercise of the Converted Option prior to the second anniversary of the date of grant, or, if later, prior to the first anniversary of the date of such exercise if, at the time the Wintrust Option was exercised, the Option was eligible for treatment as an ISO. In the event that any withholding taxes apply at the time of exercise, Optionee shall promptly pay, or cause to be paid, to Wintrust cash equal to such taxes or Optionee may direct that there be withheld from the shares issuable upon exercise shares of Wintrust Common Stock with a Fair Market Value (as defined in the Plan as amended at the Effective Time) equal to the minimum required withholding taxes.


5.Effect of Conversion Agreement. Except as expressly provided for herein, this Conversion Agreement shall effect no amendment, change or modification whatsoever of or to an Option Agreement or to the Plan. From and after the Effective Time, each Option shall be subject to the amended terms of the Plan as so amended in accordance with the Merger Agreement, but only to the extent expressly provided for herein or that does not otherwise impair the rights of the Optionee in the Option. Unless defined herein, capitalized terms used in this Conversion Agreement shall have the same meaning ascribed to them under the Plan.

[Signature Page Follows]

IN WITNESS WHEREOF, the Company has caused this Conversion Agreement to be executed by its duly authorized officers and the Optionee has hereunto set his hand and seal, all as of the date and year first above written.

WINTRUST FINANCIAL CORPORATIONDELAVAN BANCSHARES, INC.
By:

By:

Its:

Its:

ATTEST:OPTIONEE:

Signature

Print Name

Exhibit A to Conversion Agreement

OPTIONEE SUMMARY

Schedule of Stock Options

Covered by the Conversion Agreement

Optionee:

Grant Date

Expiration DateCompany Common Stock Shares (#)Exercise Price Per Share($)

Exhibit C

Form of Opinion of Company Counsel

The opinion of Company counsel to be delivered in accordance with Section 6.7 of the Merger Agreement will include the opinions set forth below, subject to limitations, qualifications and exclusions and reliance by counsel on factual matters all as will be stated in the opinion letter.

(i) The Company is duly registered as a bank holding company under the Bank Holding Company Act of 1956, as amended and, based solely upon the Certificate of Status of the Department of Financial Institutions (DFI) dated                     , the Company is a corporation duly organized and validly existing under the laws of the State of Wisconsin, and has not filed articles of dissolution. Based solely upon the Certificate of Status of DFI for the Bank dated                     , the Bank is a state bank duly organized, validly existing and in good standing under the laws of the State of Wisconsin, and has the requisite power and authority to own its properties and carry on its business as presently conducted.

(ii) The Company has the corporate power and authority to execute, deliver and perform its obligations under the Merger Agreement, and the execution, delivery and performance thereof by the Company have been duly authorized by all necessary corporate action on the part of the Company.

(iii) The authorized capital stock of the Company consists of 400,000 shares of common stock, $1.00 par value per share, of which 373,989 shares are issued and outstanding as of the date of the Merger Agreement, and 2,489 shares are held in treasury. The issued and outstanding shares of common stock of the Company have been duly and validly authorized and issued and are fully paid and nonassessable. None of the shares of the common stock of the Company are subject to any preferences, qualifications, limitations, restrictions or special or relative rights other than as set forth in the Company’s articles of incorporation. Except for the Outstanding Company Options under the Company Option Plan, there are no options, agreements, contracts, or other rights in existence to purchase or acquire from the Company any shares of capital stock of the Company, whether now or hereafter authorized or issued. Except for the Voting Agreement to be entered into concurrently with the Merger Agreement, there are no voting trusts, voting agreements, proxies or other agreements, instruments or undertakings with respect to the voting of any interests in the Company.

(iv) The authorized capital stock of the Bank consists of 1,000,000 shares of common stock, $1.00 par value per share, of which 1,000,000 shares are issued and outstanding, all of which are owned by the Company. The issued and outstanding shares of common stock of the Bank have been duly and validly authorized and issued and are fully paid and nonassessable (except as provided in Section 220.07 of Wisconsin Statutes) and owned by the Company. There are no options, agreements, contracts or other rights in existence to purchase or acquire from the Bank any shares of capital stock of the Bank, whether now or hereafter authorized or issued.

(v) The authorized capital stock of CB Investments, Inc. consists of 1,000 shares of common stock, $1.00 par value per share, of which 1,000 shares are issued and outstanding, all of which are owned by the Bank. The issued and outstanding shares of common stock of CB Investments, Inc. have been duly and validly authorized and issued and are fully paid and non-assessable and owned by the Bank. There are no options, agreements, contracts, or other rights in existence to purchase or acquire from CB Investments, Inc. any shares of capital stock of CB Investments, Inc., whether now or hereafter authorized or issued.

(vi) The Bank owns 100% of the issued and outstanding member interests of CBD Holdings, LLC. The issued and outstanding member interests of CBD Holdings, LLC are duly and validly authorized and issued. The Bank is under no obligation to contribute additional capital to CBD Holdings, LLC. There are no options, agreements, contracts, or other rights in existence to purchase or acquire additional member interests from CBD Holdings, LLC, whether now or hereafter authorized or issued.

(vii) The Bank owns 100% of the issued and outstanding member interests of Ponds of Darien LLC. The issued and outstanding member interests of Ponds of Darien, LLC are duly and validly


authorized and issued. The Bank is under no obligation to contribute additional capital to Ponds of Darien, LLC. There are no options, agreements, contracts, or other rights in existence to purchase or acquire additional member interests from Ponds of Darien, LLC, whether now or hereafter authorized or issued.

(viii) The Merger Agreement has been duly executed and delivered by the Company and constitutes the valid and binding obligation of the Company, enforceable against the Company in accordance with its terms.

(ix) The execution and delivery by the Company of the Merger Agreement do not, and the performance by the Company of its obligations under the Merger Agreement will not, (i) violate or conflict with the articles of incorporation or by-laws of the Company, (ii) violate any banking law, rule or regulation applicable to the Company or the Bank, (iii) violate any judgment, injunction, order or decree which is listed on the attachment to this opinion letter, or (iv) Based solely on the Officer’s Certificate of the Company, breach or result in a default under any indenture, mortgage, instrument or agreement.

(x) The execution and delivery by the Company of the Merger Agreement does not require any consent or approval of, or filing or registration with, any Governmental Authority (as such term is defined in the Merger Agreement), except such as have been obtained or made pursuant to the Merger Agreement.

Exhibit D

FORM OF EMPLOYMENT AGREEMENT

This Employment Agreement (the “Agreement”) is made by and between Community Bank CBD, a Wisconsin state chartered bank (“Employer”) and Michael J. Murphy, an individual resident in the State of Wisconsin (“Executive”) as of             , 2014.

WITNESSETH THAT:

WHEREAS, Employer is engaged in the business of general banking;

WHEREAS, Employer’s parent company, Delavan Bancshares, Inc., a Wisconsin corporation (the “Parent”), and Wintrust Financial Corporation (“Wintrust”), have executed and delivered as of the date hereof an Agreement and Plan of Merger (the “Merger Agreement”), pursuant to which Wintrust shall acquire, in accordance with the terms and conditions set forth in the Merger Agreement, the Parent via the Merger (as such term is defined therein), upon which Employer shall become a wholly owned subsidiary of Wintrust;

WHEREAS, the Merger Agreement provides that, as a condition to Closing (as such term is defined therein), Executive shall have entered into this Agreement on the terms and conditions set forth herein, which Agreement is to become effective as of the consummation of the Merger (the “Effective Date”);

WHEREAS, Executive acknowledges and agrees that this Agreement is ancillary to the Merger Agreement and that Wintrust would not enter into the transactions contemplated by the Merger Agreement if the Executive did not execute and deliver this Agreement;

WHEREAS, Executive has particular expertise and knowledge concerning the business of Employer;

WHEREAS, by virtue of Executive’s employment with Employer, Executive will become acquainted with certain confidential information regarding the services, customers, methods of doing business, strategic plans, marketing, and other aspects of the business of Employer, Wintrust or its Affiliates;

WHEREAS, Employer and Executive desire to state and set forth in this Agreement the terms, conditions and obligations of the parties with respect to such employment; and as of the Effective Date, except as otherwise provided herein, this Agreement is intended by the parties to supersede all previous agreements and understanding, whether written or oral, concerning such employment.

NOW THEREFORE, in consideration of the covenants and agreements contained herein, of Executive’s employment, of the compensation to be paid by Employer for Executive’s services, and of Employer’s other undertakings in this Agreement, the parties hereto do hereby agree as follows:

1.Scope of Employment. Executive will be employed as President of Employer and shall perform such duties as may be assigned to Executive by the Board of Directors of Employer in such position. Executive agrees that during Executive’s employment Executive will be subject to and abide by the written policies and practices of Employer and Wintrust. Executive also agrees to assume such new or additional positions and responsibilities commensurate with the position of President of Employer as Executive may from time to time be assigned for or on behalf of Employer or Wintrust, it being understood that in the event Wintrust decides to combine Employer or certain of its operations with those of the Employer’s Affiliate Town Bank, that the position of “Market President” shall be assumed by the Executive and be within the scope of Executive’s employment hereunder and that, following such combination, references to Employer hereunder shall include references to Town Bank. Notwithstanding the foregoing, during the Term (as defined in Section 8 herein) of this Agreement, Executive will not be required without Executive’s consent to move Executive’s principal business location to another location more than a 25 mile radius from Executive’s now existing principal business location. For purposes of this Agreement, the term “Affiliate” shall include but not be limited to the entities listed in Exhibit A to this Agreement and any subsidiary of any of such entities and shall further include any present or future affiliate of any of them as


defined by the rules and regulations of the Federal Reserve Board. In the event Executive shall perform services for Wintrust or any Affiliate, the provisions of this Agreement shall also apply to the performance of such services by Executive on behalf of Wintrust or any Affiliate.

2.Compensation and Benefits. During the Term, Executive shall be entitled to the following compensation and benefits:

(a) Executive’s annual base salary (the “Annual Base Salary”) shall be as set forth in Schedule A, and shall be payable in accordance with the normal payroll practices of Employer. During the Term, the Annual Base Salary may be increased or decreased by Employer, its sole and absolute discretion,providedthat the Annual Base Salary may not be decreased below the amount set forth on Schedule A without Executive’s consent so long as Executive remains a full-time employee of Employer.

(b) Executive shall be eligible to receive an annual performance-based bonus (the “Incentive Bonus”) as set forth in Schedule A. The actual amount of the Incentive Bonus (if any) earned by and payable to the Executive for each fiscal year in the Term shall be determined by the Compensation Committee of Wintrust’s Board of Directors and/or the Board of Directors of Employer, in their sole and absolute discretion, based upon the satisfaction of goals and objectives applicable to Executive and established by the Compensation Committee of Wintrust’s Board of Directors and/or the Board of Directors of Employer. Any Incentive Bonus payable pursuant to this Section 2(b) shall be subject to, and paid to Executive in accordance with, the terms and conditions of the Employer’s annual bonus guidelines as in effect from time to time.

(c) Executive will be entitled to coverage under such compensation plans, insurance plans and other fringe benefit plans and programs as may from time to time be established for similarly-situated employees of Employer, Wintrust and its Affiliates in accordance with the terms and conditions of such plans and programs. Executive shall also be eligible to participate in the Wintrust 2007 Stock Incentive Plan or any successor Plan thereto.

(d) Executive shall be entitled to six weeks of paid vacation leave each year during the term of this Agreement, excluding holidays, at such times within each year as Executive may determine, taking into account Employer’s schedule and Executive’s duties relative thereto.

(e) If requested by Executive, Employer shall, at its expense, make available to Executive an automobile for professional and private use.

(f) Employer shall pay all voice, text and data charges associated with Executive’s use of his cellular telephone, and Employer shall pay Executive’s membership dues at Big Foot Country Club.

(g) Employer shall pay all reasonable travel, mileage, dining and other ordinary, necessary and reasonable business expenses incurred by Executive in the performance of his duties under this Agreement.

3.Extent of Service. Executive shall devote Executive’s entire business time, attention and energies to the business of Employer during the Term of this Agreement; but this shall not be construed as preventing Executive from (a) investing Executive’s personal assets in such form or manner as will not require any services on the part of Executive in the operation or the affairs of the corporations, partnerships and other entities in which such investments are made and in which Executive’s participation is solely that of an investor (subject to any and all rules and regulations of applicable banking regulators or policies of the Employer governing transactions with affiliates and ownership interests in customers); (b) engaging (whether or not during normal business hours) in any other business, professional or civic activities provided that the Board of Directors of Employer approves of such activities and Executive’s engagement does not result in a violation of Executive’s covenants under this Section or Sections 4 or 5 hereof; (c) serving as a member of the Board of Directors of the St. Andrews Catholic Church Endowment Fund, and/or serving as the Finance Officer and as a member of the Executive Council of Big Foot Country Club; or (d) accepting appointments to the boards of directors of other companies provided that the Board of Directors of Employer approves of such appointments and Executive’s performance of Executive’s duties on such boards does not result in a violation of Executive’s covenants under this Section or Sections 4 and 5 hereof.

4.Competition. Other than in connection with Executive’s performance of Executive’s duties hereunder, during the period in which Executive performs services for Employer and for a period ofone year after termination of Executive’s employment with Employer, regardless of the reason for such termination of employment, Executive shall not directly or indirectly, either alone or in conjunction with any other person, firm, association, company or corporation:

(a) serve as an owner, principal, agent, senior manager, employee or in a position comparable to that held by Executive at any time during Executive’s employment with Employer, for a bank or other financial institution (or any branch or affiliate thereof) which offers to its customers commercial and community banking and/or trust and investment services, and which is located within ten miles of the principal office or any branch office of the Employer as currently situated;

(b) solicit or conduct business which involves commercial and community banking and/or trust and investment services with any person, corporation or other entity which was (i) a customer of the Employer, Wintrust or any other Affiliate of Wintrust with whom Executive had direct or indirect contact while employed by Employer or about whom Executive obtained Confidential Information during the fifteen months prior to the termination of Executive’s employment with Employer, or (ii) a potential customer with whom Employer, Wintrust, or any Affiliate has, at the time of Executive’s termination of employment with Employer, an outstanding oral or written proposal to provide commercial and community banking and/or trust and investment services and with whom Executive had direct or indirect contact while employed by Employer;

(c) request, advise or directly or indirectly invite any of the existing customers, suppliers or service providers of Employer, Wintrust or any other Affiliate of Wintrust to withdraw, curtail or cancel its business with Employer, Wintrust or any other Affiliate of Wintrust, other than through mass mailings or general advertisements not specifically directed at customers of Employer, Wintrust or any Affiliate;

(d) hire, solicit, induce or attempt to solicit or induce any employee of Employer, Wintrust or any other Affiliate of Wintrust (i) to terminate his or her employment or association with Employer or (ii) to become employed by or serve in any capacity by a bank or other financial institution; or

(e) in any way participate in planning or opening a bank or other financial institution which is located or will be located within a ten mile radius of the principal office or any branch office of the Employer. For the purposes of this Agreement, in the event Executive’s geographic area of responsibility as specified herein shall change during employment with Employer, or as the result of performing services for Wintrust or any Affiliate of Wintrust, the Executive’s obligation stated in Sections 4(a) and 4(e) shall apply to a ten mile radius of Executive’s revised geographic area of responsibility.

Notwithstanding the foregoing, (a) Executive shall not be prevented from: (i) investing or owning shares of stock of any corporation engaged in any business provided that such shares are regularly traded on a national securities exchange or any over-the-counter market; (ii) retaining any shares of stock in any corporation which Executive owned prior to his execution of this Agreement (subject to any and all rules and regulations of applicable banking regulators or policies of the Employer governing transactions with affiliates and ownership interests in customers); or (iii) investing as a limited partner (without decision-making authority) in any private equity fund, provided that Executive’s involvement in such investment is solely that of a passive investor (subject to any and all rules and regulations of applicable banking regulators or policies of the Employer governing transactions with affiliates and ownership interests in customers), and (b) Executive shall not be in violation of Sections 4(a) or 4(e) of this Agreement if, during the one-year period following termination of employment Executive accepts employment or invests in a bank or other financial institution which is within a ten mile radius of the principal offices or any branch office of Wintrust or any Affiliate of Wintrust (other than Employer) as long as such facility is not within a ten mile radius of the principal office or any branch office of the Employer.

5.Confidential Information. Executive acknowledges that, during Executive’s employment with Employer, Executive has and will obtain access to Confidential Information of and for Employer, Wintrust or its Affiliates. For purposes of this Agreement, “Confidential Information” shall mean information not generally known or available without restriction to the trade or industry, including, without limitation, the following categories of information and documentation: (a) documentation and information relating to lending customers of Employer,

Wintrust or any Affiliate, including, but not limited to, lists of lending clients with their addresses and account numbers, credit analysis reports and other credit files, outstanding loan amounts, repayment dates and instructions, information regarding the use of the loan proceeds, and loan maturity and renewal dates; (b) documentation and information relating to depositors of Employer, Wintrust or any Affiliate, including, but not limited to, lists of depositors with their addresses and account numbers, amounts held on deposit, types of depository products used and the number of accounts per customer; (c) documentation and information relating to trust customers of Employer, Wintrust or any Affiliate, including, but not limited to, lists of trust customers with their addresses and account numbers, trust investment management contracts, identity of investment managers, trust corpus amounts, and grantor and beneficiary information; (d) documentation and information relating to investment management clients of Employer, Wintrust or any Affiliate, including, but not limited to, lists of investors with their addresses, account numbers and beneficiary information, investment management contracts, amount of assets held for management, and the nature of the investment products used; (e) the identity of actual or potential customers of Employer, Wintrust or any Affiliate, including lists of the same; (f) the identity of suppliers and service providers of Employer, Wintrust or any Affiliate, including lists of the same and the material terms of any supply or service contracts; (g) marketing materials and information regarding the products and services offered by Employer, Wintrust or any Affiliate and the nature and scope of use of such marketing materials and product information; (h) policy and procedure manuals and other materials used by Employer, Wintrust or any Affiliate in the training and development of its employees; (i) identity and contents of all computer systems, programs and software utilized by Employer, Wintrust or any Affiliate to conduct its operations and manuals or other instructions for their use; (j) minutes or other summaries of Board of Directors or other department or committee meetings held by Employer, Wintrust or any Affiliate; (k) the business and strategic growth plans of Employer, Wintrust or any Affiliate; and (l) confidential communication materials provided for shareholders of Employer, Wintrust or any Affiliate. Absent prior authorization by Employer or as required in Executive’s duties for Employer, Executive will not at any time, directly or indirectly, use, permit the use of, disclose or permit the disclosure to any third party of any such Confidential Information to which Executive will be provided access. These obligations apply both during Executive’s employment with Employer and shall continue beyond the termination of Executive’s employment and this Agreement; provided, however, that Executive’s obligations with respect to the Confidential Information described in (a) through (f) of this Section 5 shall cease upon the expiration of one year following the termination of Executive’s employment with Employer.

6.Inventions. All discoveries, designs, improvements, ideas, and inventions, whether patentable or not, relating to (or suggested by or resulting from) products, services, or other technology of Employer, Wintrust or any Affiliate or relating to (or suggested by or resulting from) methods or processes used or usable in connection with the business of Employer, Wintrust or any Affiliate that may be conceived, developed, or made by Executive during employment with Employer (hereinafter “Inventions”), either solely or jointly with others, shall automatically become the sole property of Employer, Wintrust or an Affiliate. Executive shall immediately disclose to Employer all such Inventions and shall, without additional compensation, execute all assignments and other documents deemed necessary to perfect the property rights of Employer, Wintrust or any Affiliate therein. These obligations shall continue beyond the termination of Executive’s employment with respect to Inventions conceived, developed, or made by Executive during employment with Employer. The provisions of this Section 6 shall not apply to any Invention for which no equipment, supplies, facility, or trade secret information of Employer, Wintrust or any Affiliate is used by Executive and which is developed entirely on Executive’s own time, unless (a) such Invention relates (i) to the business of Employer, Wintrust or an Affiliate or (ii) to the actual or demonstrably anticipated research or development of Employer, Wintrust or an Affiliate, or (b) such Invention results from work performed by Executive for Employer.

7.Remedies. Executive acknowledges that compliance with the terms of this Agreement is necessary to protect the Confidential Information and goodwill of Employer, Wintrust and its Affiliates and that any breach by Executive of this Agreement will cause continuing and irreparable injury to Employer, Wintrust and its Affiliates for which money damages would not be an adequate remedy. Executive acknowledges that Wintrust and all other Affiliates are and are intended to be third party beneficiaries of this Agreement. Executive acknowledges that Employer, Wintrust and any Affiliate shall, in addition to any other rights or remedies they may have, be entitled to injunctive relief for any breach by Executive of any part of this Agreement. This Agreement shall not in any way limit the remedies in law or equity otherwise available to Employer, Wintrust and its Affiliates.

8.Term of Agreement. (a) Unless terminated sooner as provided in Section 9, the initial term of Executive’s employment pursuant to this Agreement (“Initial Term”) shall beone (1) year, commencing on the Effective Date;provided,however, that in the event the Merger Agreement is terminated for any reason without the Closing (as defined in the Merger Agreement) of the merger contemplated thereby, this Agreement shall simultaneously terminate without further obligation or liability on the part of any party hereto, and all agreements relating to Executive’s employment with Employer executed prior to the date of this Agreement shall remain in full force and effect. After such Initial Term, this Agreement shall be extended automatically for successive one-year terms, unless either Executive or Employer gives contrary written notice not less than 60 days in advance of the expiration of the Initial Term or any succeeding term of this Agreement or unless terminated sooner as provided in Section 9. Notwithstanding the foregoing, if at any time during the Initial Term or any successive one-year term there is a Change in Control of Employer (as defined in Section 9(d)), then upon the first occurrence of such a Change in Control, the Initial Term or the successive one-year term of this Agreement (whichever is in effect as of the date of the Change in Control) shall automatically extend for the greater of: (i) the amount of time remaining on Executive’s Initial Term of employment if such first occurrence of a Change in Control occurs during the Initial Term, or (ii) one (1) year from the date of such first occurrence of a Change in Control. In the event that Executive’s Initial Term or successive one-year term is extended due to such a Change in Control, such extension shall further be extended automatically for successive one-year terms unless either Executive or Employer gives contrary written notice not less than 60 days in advance of the expiration of the extension of this Agreement or unless terminated sooner as provided in Section 9. The Initial Term, together with any extension thereof in accordance with this Section 8, shall be referred to herein as the “Term.”

(b) In the event that both (i) Executive or Employer terminates this Agreement pursuant to this Section 8 during the course of any term of this Agreement and (ii) Executive and Employer agree that Executive will remain employed with Employer, then within 30 days of the date of the termination of this Agreement Employer shall pay Executive $250,000.

9.Termination of Employment.

(a)General Provisions. Executive’s employment may be terminated by Employer at any time for any reason, with or without cause, and, except as otherwise provided in this Section 9, any and all of Employer’s obligations under this Agreement shall terminate, other than Employer’s obligation to pay Executive, within 30 days of Executive’s termination of employment, the full amount of any earned but unpaid base salary and accrued but unpaid vacation pay earned by Executive pursuant to this Agreement through and including the date of termination and to observe the terms and conditions of any plan or benefit arrangement which, by its terms, survives such termination of Executive’s employment. The payments to be made under this Section 9(a) shall be made to Executive, or in the event of Executive’s death, to such beneficiary as Executive may designate in writing to Employer for that purpose, or if Executive has not so designated, then to the spouse of Executive, or if none is surviving, then to the estate of Executive. Notwithstanding the foregoing, termination of employment shall not affect the obligations of Executive that, pursuant to the express provisions of this Agreement, continue in effect.

(b)Termination Without Cause.

(i)Payment. In the event Executive’s employment is terminated without Cause (as such term is defined in Section 9(f) hereof) by Employer or by reason of Executive’s death or permanent disability (as hereinafter defined) during the Term of this Agreement, other than upon the expiration of the Term of this Agreement, Employer shall pay Severance Pay to Executive, or in the event of Executive’s death, to such beneficiary as Executive may designate in writing to Employer for that purpose, or if Executive has not so designated, then to the spouse of Executive, or if none is surviving, then to the estate of Executive. Severance Pay under this Section 9(b)(i) shall mean an amount equal to one times (1x) the sum of (A) an amount equal to Executive’s then current Annual Base Salary, plus (B) an amount equal to the target Incentive Bonus as set forth on Schedule A hereto, plus (C) $250,000. Notwithstanding anything herein to the contrary, annual incentive compensation shall not include any equity-based award or cash award with a vesting period of greater than one-year. Severance Pay under this Section 9(b) shall be paid ratably over a 12-month period beginning on the first payroll period following such termination and on each payroll period thereafter during such Severance Pay period.

(ii)Reduction of Payment Due To Earned Income. The amount of Severance Pay under this Section 9(b) shall also be reduced by any income earned by Executive, whether paid to Executive immediately or deferred until a later date, during the applicable Severance Pay period from employment of any sort, including without limitation full, part time or temporary employment or work as an independent contractor or as a consultant;provided that, if Executive was a member of the board of directors of another company at the time of Executive’s termination, the amount of Severance Pay under this Section 9(b) shall not be reduced by any income earned by Executive during the applicable Severance Pay period due to Executive’s continued service in such capacity. Notwithstanding the foregoing, Executive’s Severance Pay to be paid under this Section 9(b) shall not be less than an amount to provide Executive with a gross monthly payment of $20,833.35 during the 12-month Severance Pay period. Executive agrees to promptly notify Employer if Executive obtains employment of any sort during the applicable Severance Pay period and to provide Employer with a copy of his earnings statements or other payroll or income records for each calendar month during the 12-month Severance Pay period and a summary of any contributions received under any deferred compensation arrangement for each calendar month during the 12-month Severance Pay period. In addition, no later than 45 days following the expiration of each calendar year during the 12-month Severance Pay period, Executive shall deliver to the Employer all W-2 and 1099 forms received during such calendar year.

(iii)Company-Paid Health Insurance. In the event of Executive’s termination pursuant to this Section 9(b) (other than by reason of Executive’s death), from the termination date through the earliest of (A) the expiration of the maximum period of COBRA coverage, (B) the date on which Executive becomes eligible for coverage under another group health insurance plan with no pre-existing condition limitation or exclusion, or (C) the date on which Executive becomes entitled to benefits under Medicare, Executive (and any qualified dependents) shall be entitled to group health insurance coverage under the Employer’s group health insurance plan for employees (as such plan is then in effect and as it may be amended at any time and from time to time during the period of coverage) in which Executive was participating immediately prior to termination, at Employer’s expense, subject to any normal employee contributions, if any. The period during which Executive is being provided with health insurance under this Agreement shall be credited against Executive’s period of COBRA coverage, if any. Executive shall promptly notify Employer if, prior to the expiration of the maximum period of COBRA coverage, Executive becomes eligible for coverage under another group health plan with no pre-existing condition limitation or exclusion or Executive becomes entitled to benefits under Medicare.

(c)Constructive Termination.

(i)Payment. If Executive suffers a Constructive Termination during the Term of this Agreement, other than upon the expiration of the Term of this Agreement, Employer shall pay Severance Pay to Executive in the amounts and at the times described in Section 9(b) hereof. For purposes of this Agreement, “Constructive Termination” means (A) a material reduction by Employer in the duties and responsibilities of Executive or (B) a reduction by Employer of Executive’s “Adjusted Total Compensation” (as hereinafter defined) to (1) less than seventy-five percent (75%) of the Adjusted Total Compensation of Executive for the twelve-month period ending as of the last day of the month immediately preceding the month in which the Constructive Termination occurs; or (2) less than seventy-five percent (75%) of the Executive’s Adjusted Total Compensation for the twelve-month period ending as of the last day of the month preceding the Effective Date, whichever is greater;provided,however, that with respect to either (1) or (2), if Executive is employed by Employer or any Affiliate of Employer for less than twelve months, Adjusted Total Compensation shall be calculated based on the initial annual base salary and value of perquisites, determined by the Employer as of the date Executive commences employment with the Employer or such Affiliate. A Constructive Termination does not include termination for Cause as defined in Section 9(f) or a termination without Cause as defined in Section 9(b).

(ii)Reduction of Payment Due To Earned Income. The amount of Severance Pay under this Section 9(c) shall be reduced by any income earned by Executive, whether paid to Executive immediately or deferred until a later date, during such Severance Pay period from employment of any sort, including without limitation full, part time or temporary employment or work as an independent contractor or as a consultant;provided that, if Executive was a member of the board of directors of another company at the time of Executive’s termination, the amount of Severance Pay under this Section 9(c) shall not be reduced by any income earned by Executive during the applicable Severance Pay period due to Executive’s continued service in such capacity. Notwithstanding the foregoing, Executive’s Severance Pay to be paid under this Section 9(c) shall not be less than an amount to provide

Executive with a gross monthly payment of $20,833.35 during the 12-month Severance Pay period. Executive agrees to promptly notify Employer if Executive obtains employment of any sort during the applicable Severance Pay period and to provide Employer with a copy of his earnings statements or other payroll or income records for each calendar month during the 12-month Severance Pay period and a summary of any contributions received under any deferred compensation arrangement for each calendar month during the 12-month Severance Pay period. In addition, no later than 45 days following the expiration of each calendar year during the 12-month Severance Pay period, Executive shall deliver to the Employer all W-2 and 1099 forms received during such calendar year.

(iii)Company-Paid Health Insurance. In the event of Executive’s termination pursuant to this Section 9(c), from the termination date through the earliest of (A) the expiration of the maximum period of COBRA coverage, (B) the date on which Executive becomes eligible for coverage under another group health insurance plan with no pre-existing condition limitation or exclusion, or (C) the date on which Executive becomes entitled to benefits under Medicare, Executive (and any qualified dependents) shall be entitled to group health insurance coverage under the Employer’s group health insurance plan for employees (as such plan is then in effect and as it may be amended at any time and from time to time during the period of coverage) in which Executive was participating immediately prior to termination, at Employer’s expense, subject to any normal employee contributions, if any. The period during which Executive is being provided with health insurance under this Agreement shall be credited against Executive’s period of COBRA coverage, if any. Executive shall promptly notify Employer if, prior to the expiration of the maximum period of COBRA coverage, Executive becomes eligible for coverage under another group health plan with no pre-existing condition limitation or exclusion or Executive becomes entitled to benefits under Medicare.

(iv)Definitions.

(A) For the purposes of this Agreement, “Adjusted Total Compensation” means the aggregate base salary earned by the Executive plus the dollar value of all perquisites (i.e. Employer provided car, club dues and supplemental life insurance) as estimated by Employer. Adjusted Total Compensation shall exclude any bonus payments, annual or long-term cash incentive compensation or equity-based compensation paid to, awarded to or earned by the Executive. For the purposes of this Section 9(c), the Executive will not be deemed to have incurred a reduction by Employer of Executive’s Adjusted Total Compensation if there is a general reduction in base salaries and/or perquisites applicable to the President, Chief Executive Officer and all Vice Presidents of Employer.

(B) For the purposes of this Agreement, “permanent disability” means any mental or physical illness, disability or incapacity that renders Executive unable to perform Executive’s duties hereunder where (x) such permanent disability has been determined to exist by a physician selected by Employer or (y) Employer has reasonably determined, based on such physician’s advice, that such disability will continue for 180 days or more within any 365-day period, of which at least 90 days are consecutive. Executive shall cooperate in all respects with Employer if a question arises as to whether he has become disabled (including, without limitation, submitting to an examination by a physician or other health care specialist selected by Employer and authorizing such physician or other health care specialist to discuss Executive’s condition with Employer).

(d)Termination Upon Change In Control.

(i)Payment. In the event that within twelve months after a Change in Control (as defined below) of Employer or Wintrust (A) Executive’s employment is terminated without Cause (as such term is defined in Section 9(f) hereof) prior to the expiration of the Term of this Agreement or (B) Executive suffers a Constructive Termination prior to the expiration of the Term of this Agreement, Employer (or the successor thereto) shall pay Severance Pay to Executive in the amount that is equivalent to the amount described in Section 9(b) hereof in a lump sum within 30 days following the date of Executive’s termination or Constructive Termination;provided,however, that if such Change in Control is not a “change in control event,” within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), then such Severance Pay shall be paid at the same time and in the same form as set forth in Section 9(b)(i).

(ii) For the purposes of this Agreement, a “Change in Control” of Employer or Wintrust shall have the same meaning as provided in Section 12(c) of the Wintrust 2007 Stock Incentive Plan;providedthat both Employer and Wintrust shall be deemed to be the “Corporation” (or any successor term) in the application of such definition.

(iii)Section 280G. Notwithstanding the foregoing, if the payment required to be paid under this Section 9(d), when considered either alone or with other payments paid or imputed to the Executive from Employer, Wintrust or an Affiliate that would be deemed “excess parachute payments” under Section 280G(b)(1) of the Code is deemed by Employer to be a “parachute payment” under Section 280G(b)(2) of the Code, then the amount of Severance Pay required to be paid under this Section 9(d) shall be automatically reduced in order of scheduled payments to an amount equal to $1.00 less than three times (3x) the “base amount” (as defined in Section 280G(3) of the Code) (the “Reduced Amount”).Provided,however, the preceding sentence shall not apply if the sum of (A) the amount of Severance Pay described in this Section 9(d) less (B) the amount of excise tax payable by the Executive under Section 4999 of the Code with respect to the amount of such Severance Pay and any other payments paid or imputed to the Executive from Employer, Wintrust or an Affiliate that would be deemed to be “excess parachute payments” under Section 280G(b)(1) of the Code, as further adjusted for payment of taxes by the Executive is greater than the Reduced Amount, as further adjusted for payment of taxes by the Executive. The decision of Employer (based upon the recommendations of its tax counsel and accountants) as to the characterization of payments as parachute payments, the value of parachute payments, the amount of excess parachute payments, the determination of any adjustments related to payment of taxes by the Executive and the payment of the Reduced Amount shall be final.

(iv)Company-Paid Health Insurance. In the event Executive becomes entitled to payments under this Section 9(d), from the termination date through the earliest of (A) the expiration of the maximum period of COBRA coverage, (B) the date on which Executive becomes eligible for coverage under another group health insurance plan with no pre-existing condition limitation or exclusion, or (C) the date on which Executive becomes entitled to benefits under Medicare, Executive (and any qualified dependents) shall be entitled to group health insurance coverage under the Employer’s group health insurance plan for employees (as such plan is then in effect and as it may be amended at any time and from time to time during the period of coverage) in which Executive was participating immediately prior to termination, at Employer’s expense, subject to any normal employee contributions, if any. The period during which Executive is being provided with health insurance under this Agreement shall be credited against Executive’s period of COBRA coverage, if any. Executive shall promptly notify Employer if, prior to the expiration of the maximum period of COBRA coverage, Executive becomes eligible for coverage under another group health plan with no pre-existing condition limitation or exclusion or Executive becomes entitled to benefits under Medicare.

(v)Definitions. For the purposes of this Section 9(d), the term “Constructive Termination” shall have the same meaning as such term is defined in Section 9(c) with the following modifications:

(A) A Constructive Termination shall be deemed to have occurred if after a Change in Control, the Executive’s Adjusted Total Compensation is reduced to less than (1) 100% of the Adjusted Total Compensation of Executive for the twelve-month period ending as of the last day of the month immediately preceding the month in which the Constructive Termination occurs or (2) 100% percent of the Executive’s Adjusted Total Compensation for the twelve-month period ending as of the last day of the month preceding the Effective Date, whichever is greater;provided,however, that with respect to either (1) or (2), if Executive is employed by Employer or any Affiliate of Employer for less than twelve months, Adjusted Total Compensation shall be calculated based on the initial annual base salary and value of perquisites, determined by the Employer as of the date Executive commences employment with the Employer or such Affiliate.

(B) A Constructive Termination shall also be deemed to have occurred if after a Change in Control, Employer (or the successor thereto) delivers written notice to Executive that it will continue to employ Executive but will reject this Agreement (other than due to the expiration of the Term of this Agreement).

(C) The last sentence of subsection 9(c)(iv)(A) shall not be applicable to a Constructive Termination following a Change in Control.

(e)Voluntary Termination. Executive may voluntarily terminate employment during the Term of this Agreement by a delivery to Employer of a written notice at least 60 days in advance of the termination date.

(i) If Executive voluntarily terminates employment prior to the expiration of the Initial Term of this Agreement, any and all of the Employer’s obligations under this Agreement shall terminate immediately except for the Employer’s obligations contained in Section 9(a) hereof.

(ii) If Executive voluntarily terminates employment prior to the expiration of the Term of this Agreement but after the end of the Initial Term of this Agreement, any and all of the Employer’s obligations under this Agreement shall terminate immediately except for (A) the Employer’s obligations contained in Section 9(a) hereof and (B) the payment of $250,000 as provided in Section 8(b) hereof.

(iii) Notwithstanding the foregoing, termination of employment shall not affect the obligations of Executive that, pursuant to the express provisions of this Agreement, continue in effect following Executive’s termination of employment including, without limitation, Sections 4, 5 and 6 of this Agreement.

(f)Termination For Cause. If Executive is terminated for Cause as determined by the written resolution of Employer’s Board of Directors or any committee thereof designated by Employer’s Board of Directors, all obligations of the Employer shall terminate immediately except for Employer’s obligations described in Section 9(a) hereof. Notwithstanding the foregoing, termination of employment shall not affect the obligations of Executive that, pursuant to the express provisions of this Agreement, continue in effect. For purposes of this Agreement, termination for “Cause” means:

(i) Executive’s failure or refusal (other than a failure or refusal resulting from Executive’s incapacity due to disability or physical or mental illness), after written notice thereof and after reasonable opportunity to cure, to perform specific directives approved by a majority of the Employer’s or Wintrust’s Board of Directors which are both reasonable and consistent with the scope and nature of Executive’s duties and responsibilities as provided in Section 1 of this Agreement;

(ii) Habitual drunkenness or illegal use of drugs which interferes with the performance of Executive’s duties and obligations under this Agreement;

(iii) Executive’s conviction of a felony;

(iv) Any defalcation or acts of gross or willful misconduct of Executive resulting in or potentially resulting in economic loss to Employer or Wintrust or substantial damage to Employer’s or Wintrust’s reputation;

(v) Any breach of Executive’s covenants contained in Sections 4 through 6 hereof;

(vi) A written order requiring termination of Executive from Executive’s position with Employer by any regulatory agency or body; or

(vii) Executive’s engagement, during the performance of Executive’s duties hereunder, in acts or omissions constituting fraud, intentional breach of fiduciary obligation, intentional wrongdoing or malfeasance, or intentional and material violation of applicable banking laws, rules, or regulations.

(g) Executive’s right to the Severance Pay per Sections 9(b) through 9(d) hereof shall be contingent upon (i) Executive having executed and delivered to Employer a release in a form substantially similar to the release attached hereto as Exhibit B, within 45 days after the date of termination) (the “Consideration Period”), (ii) Executive not revoking such release in accordance with the terms of the release and (ii) Executive not violating any of Executive’s on-going obligations under this Agreement;provided,however, that Employer has the discretion to pay to Executive the Severance Pay per Sections 9(b) through 9(d), as applicable, prior to Employer’s receipt of the release and/or the expiration of the release revocation period;providedfurther that if Executive does not execute and deliver a release to Employer prior to the expiration of the Consideration Period or if Executive revokes the release in accordance with its terms, Executive shall pay to Employer within 10 days following the expiration of the Consideration Period or the date such release was revoked, a lump sum payment of all Severance Pay received by Executive to date.

(h) The payment of Severance Pay to Executive pursuant to Sections 9(b) through 9(d) hereof shall be for and in full satisfaction of any and all claims Executive may have relating to or arising out of Executive’s employment and termination of employment by Employer, any and all claims Executive may have relating to or arising out of this Agreement and the termination thereof and any and all claims Executive may have arising under any statute, ordinance or regulation or under common law. Executive expressly acknowledges and agrees that, except for whatever claim Executive may have to Severance Pay, Executive shall not have any claim for damages or other relief of any sort relating to or arising out of Executive’s employment or termination of employment by Employer or relating to or arising out of this Agreement and the termination thereof.

(i) Upon termination of employment with Employer for any reason, Executive shall promptly deliver to Employer all writings, records, data, memoranda, contracts, orders, sales literature, price lists, client lists, data processing materials, and other documents, whether or not obtained from Employer, Wintrust or any Affiliate, which pertain to or were used by Executive in connection with Executive’s employment by Employer or which pertain to Wintrust or any other Affiliate, including, but not limited to, Confidential Information, as well as any automobiles, computers or other equipment which were purchased or leased by Employer for Executive.

10.Resolution of Disputes. Except as otherwise provided herein, any disputes arising under or in connection with this Agreement or in any way arising out of, relating to or associated with the Executive’s employment with Employer or the termination of such employment (“Claims”), that Executive may have against Employer, Wintrust or any Affiliate of Wintrust, or the officers, directors, employees or agents of Employer, Wintrust, or any Affiliate of Wintrust in their capacity as such or otherwise, or that Employer, Wintrust, or any Affiliate of Wintrust may have against Executive, shall be resolved by binding arbitration, to be held in Madison, Wisconsin, in accordance with the rules and procedures of the National Rules for the Resolution of Employment Disputes of the American Arbitration Association (“AAA”) and the parties hereby agree to expedite such arbitration proceedings to the extent permitted by AAA. Judgment upon the award rendered by the arbitrator(s) may be entered in any court having jurisdiction thereof. The Claims covered by this Agreement include, but are not limited to: claims for wages or other compensation due; claims for breach of any contract or covenant, express or implied; tort claims; claims for discrimination, including but not limited to discrimination based on race, sex, sexual orientation, religion, national origin, age, marital status, handicap, disability or medical condition or harassment on any of the foregoing bases; claims for benefits, except as excluded in the following paragraph; and claims for violation of any federal, state or other governmental constitution, statute, ordinance, regulation, or public policy. The Claims covered by this Agreement do not include claims for workers’ compensation benefits or compensation; claims for unemployment compensation benefits; claims based upon an employee pension or benefit plan, the terms of which contain an arbitration or other non-judicial resolution procedure, in which case the provisions of such plan shall apply; and claims made by either Employer or the Executive for injunctive and/or other equitable relief regarding the covenants set forth in Sections 3, 4, 5 and 6 of this Agreement. Each party shall initially bear their own attorneys’ costs and fees, provided that Employer shall pay the costs and fees associated with any arbitration, and further provided that if Employer is found to have violated any material terms of this Agreement, Employer shall reimburse Executive for the entire amount of reasonable attorneys’ fees incurred by Executive as a result of the dispute hereunder in addition to the payment of any damages awarded to Executive.

11.General Provisions.

(a) All provisions of this Agreement are intended to be interpreted and construed in a manner to make such provisions valid, legal, and enforceable. To the extent that any Section of this Agreement or any word, phrase, clause, or sentence hereof shall be deemed by any court to be illegal or unenforceable, such word, clause, phrase, sentence, or Section shall be deemed modified, restricted, or omitted to the extent necessary to make this Agreement enforceable. Without limiting the generality of the foregoing, if the scope of any covenant in this Agreement is too broad to permit enforcement to its full extent, such covenant shall be enforced to the maximum extent provided by law; and Executive agrees that such scope may be judicially modified accordingly.

(b) This Agreement may be assigned by Employer. This Agreement and the covenants set forth herein shall inure to the benefit of and shall be binding upon the successors and assigns of Employer and Wintrust.

(c) This Agreement may not be assigned by Executive, but shall be binding upon and benefit Executive’s executors, administrators, heirs, and legal representatives.

(d) No waiver by either party of any breach by the other party of any of the obligations, covenants, or representations under this Agreement shall constitute a waiver of any prior or subsequent breach.

(e) Where in this Agreement the masculine gender is used, it shall include the feminine if the sense so requires.

(f) Employer may withhold from any payment that it is required to make under this Agreement amounts sufficient to satisfy applicable withholding requirements under any federal, state, or local law.

(g) This instrument constitutes the entire agreement of the parties with respect to its subject matter. This Agreement may not be changed or amended orally but only by an agreement in writing, signed by the party against whom enforcement of any waiver, change, modification, extension, or discharge is sought. Any other understandings and agreements, oral or written, respecting the subject matter hereof are hereby superseded and canceled, with the exception of the Salary Continuation Agreement and Restated Executive Deferred Compensation Agreement entered into by and between Executive and Employer on January 1, 2009 and June 7, 2011, respectively, and the 2004 Executive Stock Option Agreements and 2004 Executive Stock Option Plan Option Agreement entered into by and between Executive and Delavan Bancshares, Inc. on December 18, 2008, July 16, 2009 and April 30, 2013, respectively.

(h) The provisions of Sections 4, 5, 6, 7, 8(b), 9, 10, 11, 12, 15 and 16 of this Agreement shall survive the termination of Executive’s employment with Employer and the expiration or termination of this Agreement;provided,however, that in the event the Merger Agreement is terminated for any reason without the Closing (as defined in the Merger Agreement) of the merger contemplated thereby, this Agreement shall simultaneously terminate without further obligation or liability on the part of any party hereto and no provisions of this Agreement shall survive such termination.

12.Governing Law. The parties agree that this Agreement shall be construed and governed by the laws of the State of Wisconsin, excepting its conflict of laws principles. Further, the parties acknowledge and specifically agree to the jurisdiction of the courts of the State of Wisconsin in the event of any dispute regarding Sections 3, 4, 5, or 6 of this Agreement.

13.Notice of Termination. Subject to the provisions of Section 8, in the event that Employer desires to terminate the employment of the Executive during the Term of this Agreement, Employer shall deliver to Executive a written notice of termination, stating whether the termination constitutes a termination in accordance with Section 9(b), 9(d), or 9(f). In the event that Executive determines in good faith that Executive has experienced a Constructive Termination under Section 9(c) or 9(d), Executive shall deliver to Employer a written notice stating the circumstances that constitute such Constructive Termination not later than 90 days after the initial existence of such circumstances and Employer shall have 30 days after receipt of such notice to remedy the circumstances that constitute Constructive Termination. In the event that the Executive desires to effect a voluntary termination of Executive’s employment in accordance with Section 9(e), Executive shall deliver a written notice of such voluntary termination to Employer.

14.Section 409A. This Agreement is intended to comply with the requirements of Section 409A of the Code, and shall be interpreted and construed consistently with such intent. The payments to Executive pursuant to this Agreement are also intended to be exempt from Section 409A of the Code to the maximum extent possible, under either the separation pay exemption pursuant to Treasury regulation §1.409A-1(b)(9)(iii) or as short-term deferrals pursuant to Treasury regulation §1.409A-1(b)(4), and for purposes of the separation pay exemption, each installment paid to Executive under this Agreement shall be considered a separate payment. In the event the terms of this Agreement would subject Executive to taxes or penalties under Section 409A of the Code (“409A Penalties”), Employer and Executive shall cooperate diligently to amend the terms of the Agreement to avoid such 409A Penalties, to the extent possible;provided that in no event shall Employer be responsible for any 409A Penalties that arise in connection with any amounts payable under this Agreement. To the extent any amounts under this Agreement are payable by reference to Executive’s “termination of employment” such term and similar terms shall be deemed to refer to Executive’s “separation from service,” within the meaning of Section 409A of the Code. Notwithstanding any other provision in this Agreement, if Executive is a “specified employee,” as defined in Section 409A of the Code, as of the date of Executive’s separation from service, then to the extent any amount

payable under this Agreement (i) constitutes the payment of nonqualified deferred compensation, within the meaning of Section 409A of the Code, (ii) is payable upon Executive’s separation from service and (iii) under the terms of this Agreement would be payable prior to the six-month anniversary of Executive’s separation from service, such payment shall be delayed until the earlier to occur of (a) the six-month anniversary of the separation from service or (b) the date of Executive’s death. Any reimbursement payable to Executive pursuant to this Agreement shall be conditioned on the submission by Executive of all expense reports reasonably required by Employer under any applicable expense reimbursement policy, and shall be paid to Executive within 30 days following receipt of such expense reports, but in no event later than the last day of the calendar year following the calendar year in which Executive incurred the reimbursable expense. Any amount of expenses eligible for reimbursement, or in-kind benefit provided, during a calendar year shall not affect the amount of expenses eligible for reimbursement, or in-kind benefit to be provided, during any other calendar year. The right to any reimbursement or in-kind benefit pursuant to this Agreement shall not be subject to liquidation or exchange for any other benefit.

15.Indemnification. Employer shall indemnify, defend and hold Executive and Executive’s heirs, executors, administrators, legal and personal representatives, successors and assigns harmless from and against all claims, causes of action, losses, damages, judgments, liabilities, costs and expenses (including, without limitation, actual attorney fees and all costs associated with any litigation, arbitration, or administrative hearing, including but not limited to the costs and fees associated with the engagement of expert witnesses, consultant fees, service of process fees, court filing fees, and witness fees) arising out of or in any way related to Executive’s service as an employee, officer or director of Employer, Wintrust or any Affiliate, except for such liabilities that are determined to have been the result of the fraud or willful misconduct of Executive.

16.Termination of Prior Employment Contract. In consideration of the termination of the Employment Agreement entered into by and between Executive and Employer on January 1, 2009 (as subsequently amended on June 7, 2011), Employer shall pay Executive the sum of $200,000.00 upon the later of Closing or January 2, 2015, payable as compensation and subject to all normal withholding taxes.

IN WITNESS WHEREOF, the parties have executed and delivered this Agreement as of the date written opposite their signatures.

COMMUNITY BANK CBD
By:

Dated:

Name:

Title:

EXECUTIVE

Dated:

Michael J. Murphy

EXHIBIT A

Barrington Bank & Trust Company, N.A.

Beverly Bank & Trust Company, N.A.

Crystal Lake Bank & Trust Company, N.A.

First Insurance Funding of Canada

First Insurance Funding Corporation

Great Lakes Advisors, LLC

Hinsdale Bank & Trust Company

Lake Forest Bank & Trust Company

Libertyville Bank & Trust Company

Northbrook Bank & Trust Company

Old Plank Trail Community Bank, N.A.

Schaumburg Bank & Trust Company, N.A.

St. Charles Bank & Trust Company

State Bank of the Lakes

The Chicago Trust Company, N.A.

Town Bank

Tricom, Inc. of Milwaukee

Village Bank & Trust

Wayne Hummer Investments, L.L.C.

Wheaton Bank & Trust Company

Wintrust Bank

Exhibit E

Form of Opinion of Wintrust Counsel

The opinion of Wintrust counsel to be delivered in accordance with Section 7.6 of the Merger Agreement will include the matters set forth below. In rendering its opinion, Wintrust counsel may rely as to matters of fact upon certificates of the officers of Wintrust, stock records of the Wintrust and its Subsidiaries, and certificates of federal and state governmental officials and agencies, as such counsel deems appropriate.

(xi) Wintrust is duly registered as a financial holding company under the Bank Holding Company Act of 1956, as amended, and is a corporation validly existing and in good standing under the laws of the State of Illinois.

(xii) Wintrust has the corporate power and authority to execute, deliver and perform its obligations under the Merger Agreement, and the execution, delivery and performance thereof by Wintrust have been duly authorized by all necessary corporate action on the part of Wintrust.

(xiii) Wintrust Merger Co. is a corporation validly existing and in good standing under the laws of the State of Wisconsin.

(xiv) Wintrust Merger Co. has the corporate power and authority to execute, deliver and perform its obligations under the Merger Agreement, and the execution, delivery and performance thereof by Wintrust Merger Co. have been duly authorized by all necessary company action on the part of Wintrust Merger Co.

(xv) The Merger Agreement has been duly executed and delivered by each of Wintrust and Wintrust Merger Co. and constitutes the legal, valid and binding obligation of Wintrust and Wintrust Merger Co., enforceable against Wintrust and Wintrust Merger Co. in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors generally and to general principles of equity.

(xvi) The execution and delivery by Wintrust and Wintrust Merger Co. of the Merger Agreement do not, and the performance by Wintrust and Wintrust Merger Co. of their respective obligations under the Merger Agreement will not, (i) violate or conflict with the articles of incorporation or by-laws of Wintrust or Wintrust Merger Co., (ii) violate any law, rule or regulation applicable to Wintrust or Wintrust Merger Co., (iii) violate any judgment, injunction, order or decree which is listed on the Officer’s Certificate of Wintrust attached to this opinion letter or (iv) breach or result in a default under any indenture, mortgage, instrument or agreement which is filed as an Exhibit to Wintrust’s latest Annual Report on Form 10-K or to any subsequent Quarterly Report on Form 10-Q or otherwise listed on the Officer’s Certificate of Wintrust attached to this opinion letter.

(xvii) Neither the execution and delivery by Wintrust or Wintrust Merger Co. of the Merger Agreement nor the performance by Wintrust or Wintrust Merger Co. of its obligations under the Merger Agreement requires any consent or approval from or filing or registration with any Governmental Authority (as such term is defined in the Merger Agreement), except such as have been obtained or made pursuant to the Merger Agreement.

(xviii) The shares of Wintrust Common Stock (as such term is defined in the Merger Agreement) to be issued to the shareholders of Delavan Bancshares, Inc. at Closing have been duly authorized and, when issued in accordance with the Merger Agreement, will be validly issued, fully paid and non-assessable.

In rendering its opinion, such counsel may rely as to matters of fact upon such certificates of the officers of Wintrust, Wintrust Merger Co., or governmental officials as such counsel deems appropriate.


Exhibit F

Form of Date Down Endorsement

See attached.


ENDORSEMENT— SE 393-06

MODIFICATION AND DATE DOWN

Issued By:Attached to Owner’s Policy Number:

LOGO

73741

(CT File No. WA-3199)

Charge: $750.00

Schedule A is hereby amended to add the following:

The Date of the Policy is hereby amended to read:

<date of closing to be inserted>

Amount of Insurance is hereby amended to read:

<amount to be inserted if greater than amount shown on Endorsement dated February 10, 1998>

Section 1 is hereby amended to read:

Community Bank CBD, as successer by name change, to Community Bank Delavan

Schedule B is hereby amended to add the following exceptions:

1.General taxes for the year 2014, unless a receipt showing full payment is presented.

2.Special Assessments, if any, disclosed on a Special Assessment Letter to be provided.

3.Those matters, including rights of Tenants, if any, as disclosed on a Construction and Tenants Affidavit to be provided.

4.Those matters, if any, disclosed on an ALTA/ACSM Survey to be provided.

5.Those matters, if any, occurring between the Date of the issuance of this ProForma Endorsement and the Date of Closing, unless otherwise resolved.

Exception (1) is hereby deleted.

This endorsement is issued as part of the policy. Except as it expressly states, it does not (i) modify any of the terms and provisions of the policy, (ii) modify any prior endorsements, (iii) extend the Date of Policy, or (iv) increase the Amount of Insurance. To the extent a provision of the policy or a previous endorsement is inconsistent with an express provision of this endorsement, this endorsement controls. Otherwise, this endorsement is subject to all of the terms and provisions of the policy and of any prior endorsements.

Chicago Title Insurance Company

Dated:

Countersigned By:

LOGO
Authorized Officer or Agent


AMENDMENT TO

AGREEMENT AND PLAN OF MERGER

This Amendment (this “Amendment”) to the AGREEMENT AND PLAN OF MERGER (the “Agreement), is entered into as of the 19th day of November, 2014, by and among WINTRUST FINANCIAL CORPORATION, an Illinois corporation (“Wintrust”), WINTRUST MERGER CO., a Wisconsin corporation and wholly owned subsidiary of Wintrust (“Merger Co.”), and DELAVAN BANCSHARES, INC., a Wisconsin corporation (the “Company). Wintrust, Merger Co. and the Company are each referred to in the Agreement and this Amendment as a “Party” and collectively as the “Parties.”

RECITALS

A. The Parties have entered into the Agreement, pursuant to which, among other things, the Company will merge with and into Merger Co., as a result of which the Surviving Corporation will become a wholly owned subsidiary of Wintrust.

B. The Parties desire to amend and modify the Agreement on the terms and conditions set forth in this Amendment.

AGREEMENTS

Now therefore, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties agree as follows:

1.Defined Terms. Capitalized terms used but not defined in this Amendment have the definitions given to them in the Agreement.

2.Amendment to Section 4.1(d)(ii) of the Agreement. Section 4.1(d)(ii) of the Agreement is hereby amended and restated in its entirety as follows (lead-in language in (d) repeated for readability):

[(d) no Loan, or renewal or restructuring of a Loan, . .. . ]

(ii) in the amount of $1,000,000 or more (including Loans to any one borrower or related group of borrowers which, in the aggregate, equal or exceed $1,000,000) shall be made by the Bank except after delivering to Wintrust written notice, including a complete loan package for such Loan, renewal or restructuring, in a form consistent with the Bank’s policies and practice, at least five (5) business days prior to such Loan, renewal or restructuring, and such Loan or renewal or restructuring of a Loan shall be made in the Ordinary Course of Business consistent with sound banking practices, the Bank’s current loan policies and applicable rules and regulations of applicable Governmental Authorities with respect to amount, term, security and quality of such borrower or borrower’s credit;

3.Amendment to Section 4.1(o) of the Agreement. Section 4.1(o) of the Agreement is hereby amended and restated in its entirety as follows:

(o) the Bank shall only purchase or invest in obligations of the government of the United States or agencies of the United States or state or local governments having maturities of not more than ten (10) years and which municipal obligations have been assigned a rating of A or better by Moody’s Investors Service or by Standard and Poor’s;


4.References. All references to the Agreement in any other documents shall mean the Merger Agreement as amended hereby and from time to time hereafter in writing.

5.Governing Law. This Amendment shall be governed by and construed in accordance with the laws of the State of Wisconsin, without giving effect to the conflict of laws principles thereof.

6.No Other Changes. Except as set forth in this Amendment, the Agreement remains in full force and effect. The Merger Agreement, as modified by this Amendment, and the documents to be delivered under the terms of the Merger Agreement, constitute the entire agreement of the Parties with respect to the subject matter of the Merger Agreement and supersedes and renders null and void all other discussion, negotiations and other understandings with respect to such subject matter.

7.Counterparts. This Amendment may be executed in one or more counterparts, each of which will be deemed an original and all of which together will constitute one and the same instrument and will become effective when one or more counterparts have been signed by each party and delivered to the other party.

** Signature Page Follows **


IN WITNESS WHEREOF, Wintrust, the Company and Merger Co. have each executed this Amendment as of the day and year first written above.Merger]

 

WINTRUST FINANCIAL CORPORATION
By:/s/ David A. Dykstra
Name:David A. Dykstra
Title:Senior Executive Vice President

DELAVAN BANCSHARES, INC.
By:/s/ Michael J. Murphy
Name:Michael J. Murphy
Title:President

WINTRUST MERGER CO.
By:/s/ David A. Dykstra
Name:David A. Dykstra
Title:Senior Executive Vice President

[Signature Page to Amendment]


Annex B

SUBCHAPTER XIII OF THE WISCONSIN BUSINESS CORPORATION LAW

180.1301 Definitions. In ss. 180.1301 to 180.1331:

(1) “Beneficial shareholder” means a person who is a beneficial ownerTable of shares held by a nominee as the shareholder.

(1m) “Business combination” has the meaning given in s. 180.1130 (3).

(2) “Corporation” means the issuer corporation or, if the corporate action giving rise to dissenters’ rights under s. 180.1302 is a merger or share exchange that has been effectuated, the surviving domestic corporation or foreign corporation of the merger or the acquiring domestic corporation or foreign corporation of the share exchange.

(3) “Dissenter” means a shareholder or beneficial shareholder who is entitled to dissent from corporate action under s. 180.1302 and who exercises that right when and in the manner required by ss. 180.1320 to 180.1328.

(4) “Fair value”, with respect to a dissenter’s shares other than in a business combination, means the value of the shares immediately before the effectuation of the corporate action to which the dissenter objects, excluding any appreciation or depreciation in anticipation of the corporate action unless exclusion would be inequitable. “Fair value”, with respect to a dissenter’s shares in a business combination, means market value, as defined in s. 180.1130 (9) (a) 1. to 4.

(5) “Interest” means interest from the effectuation date of the corporate action until the date of payment, at the average rate currently paid by the corporation on its principal bank loans or, if none, at a rate that is fair and equitable under all of the circumstances.

(6) “Issuer corporation” means a domestic corporation that is the issuer of the shares held by a dissenter before the corporate action.

180.1302 Right to dissent.

(1) Except as provided in sub. (4) and s. 180.1008 (3), a shareholder or beneficial shareholder may dissent from, and obtain payment of the fair value of his or her shares in the event of, any of the following corporate actions:

(a) Consummation of a plan of merger to which the issuer corporation is a party if any of the following applies:

1. Shareholder approval is required for the merger by s. 180.1103 or by the articles of incorporation.

2. The issuer corporation is a subsidiary that is merged with its parent under s. 180.1104.

3. The issuer corporation is a parent that is merged with its subsidiary under s. 180.1104. This subdivision does not apply if all of the following are true:

a. The articles of incorporation of the surviving corporation do not differ from the articles of incorporation of the parent before the merger, except for amendments specified in s. 180.1002 (1) to (9).

b. Each shareholder of the parent whose shares were outstanding immediately before the effective time of the merger holds the same number of shares with identical designations, preferences, limitations, and relative rights, immediately after the merger.

c. The number of voting shares, as defined in s. 180.1103 (5) (a) 2., outstanding immediately after the merger, plus the number of voting shares issuable as a result of the merger, either by the conversion of securities issued pursuant to the merger or the exercise of rights or warrants issued pursuant to the merger, do not exceed by more than 20 percent the total number of voting shares of the parent outstanding immediately before the merger.


d. The number of participating shares, as defined in s. 180.1103 (5) (a) 1., outstanding immediately after the merger, plus the number of participating shares issuable as a result of the merger, either by the conversion of securities issued pursuant to the merger or the exercise of rights or warrants issued pursuant to the merger, do not exceed by more than 20 percent the total number of participating shares of the parent outstanding immediately before the merger.

(b) Consummation of a plan of share exchange if the issuer corporation’s shares will be acquired, and the shareholder or the shareholder holding shares on behalf of the beneficial shareholder is entitled to vote on the plan.

(c) Consummation of a sale or exchange of all, or substantially all, of the property of the issuer corporation other than in the usual and regular course of business, including a sale in dissolution, but not including any of the following:

1. A sale pursuant to court order.

2. A sale for cash pursuant to a plan by which all or substantially all of the net proceeds of the sale will be distributed to the shareholders within one year after the date of sale.

180.1302(1)(cm)(cm) Consummation of a plan of conversion.

(d) Except as provided in sub. (2), any other corporate action taken pursuant to a shareholder vote to the extent that the articles of incorporation, bylaws or a resolution of the board of directors provides that the voting or nonvoting shareholder or beneficial shareholder may dissent and obtain payment for his or her shares.

(2) Except as provided in sub. (4) and s. 180.1008 (3), the articles of incorporation may allow a shareholder or beneficial shareholder to dissent from an amendment of the articles of incorporation and obtain payment of the fair value of his or her shares if the amendment materially and adversely affects rights in respect of a dissenter’s shares because it does any of the following:

(a) Alters or abolishes a preferential right of the shares.

(b) Creates, alters or abolishes a right in respect of redemption, including a provision respecting a sinking fund for the redemption or repurchase, of the shares.

(c) Alters or abolishes a preemptive right of the holder of shares to acquire shares or other securities.

(d) Excludes or limits the right of the shares to vote on any matter or to cumulate votes, other than a limitation by dilution through issuance of shares or other securities with similar voting rights.

(e) Reduces the number of shares owned by the shareholder or beneficial shareholder to a fraction of a share if the fractional share so created is to be acquired for cash under s. 180.0604.

(3) Notwithstanding sub. (1) (a) to (c), if the issuer corporation is a statutory close corporation under ss. 180.1801 to 180.1837, a shareholder of the statutory close corporation may dissent from a corporate action and obtain payment of the fair value of his or her shares, to the extent permitted under sub. (1) (d) or (2) or s. 180.1803, 180.1813 (1) (d) or (2) (b), 180.1815 (3) or 180.1829 (1) (c).

(4) Unless the articles of incorporation provide otherwise, subs. (1) and (2) do not apply to the holders of shares of any class or series if the shares of the class or series are registered on a national securities exchange or quoted on the National Association of Securities Dealers, Inc., automated quotations system on the record date fixed to determine the shareholders entitled to notice of a shareholders meeting at which shareholders are to vote on the proposed corporate action.

(5) Except as provided in s. 180.1833, a shareholder or beneficial shareholder entitled to dissent and obtain payment for his or her shares under ss. 180.1301 to 180.1331 may not challenge the corporate action creating his or her entitlement unless the action is unlawful or fraudulent with respect to the shareholder, beneficial shareholder or issuer corporation.

180.1303 Dissent by shareholders and beneficial shareholders.

(1) A shareholder may assert dissenters’ rights as to fewer than all of the shares registered in his or her name only if the shareholder dissents with respect to all shares beneficially owned by any one person and notifies the corporation in writing of the name and address of each person on whose behalf he or she asserts dissenters’ rights. The rights of a shareholder who under this subsection asserts dissenters’ rights as to fewer than all of the shares registered in his or her name are determined as if the shares as to which he or she dissents and his or her other shares were registered in the names of different shareholders.

(2) A beneficial shareholder may assert dissenters’ rights as to shares held on his or her behalf only if the beneficial shareholder does all of the following:

(a) Submits to the corporation the shareholder’s written consent to the dissent not later than the time that the beneficial shareholder asserts dissenters’ rights.

(b) Submits the consent under par. (a) with respect to all shares of which he or she is the beneficial shareholder.

180.1320 Notice of dissenters’ rights.

(1) If proposed corporate action creating dissenters’ rights under s. 180.1302 is submitted to a vote at a shareholders’ meeting, the meeting notice shall state that shareholders and beneficial shareholders are or may be entitled to assert dissenters’ rights under ss. 180.1301 to 180.1331 and shall be accompanied by a copy of those sections.

(2) If corporate action creating dissenters’ rights under s. 180.1302 is authorized without a vote of shareholders, the corporation shall notify, in writing and in accordance with s. 180.0141, all shareholders entitled to assert dissenters’ rights that the action was authorized and send them the dissenters’ notice described in s. 180.1322.

180.1321 Notice of intent to demand payment.

(1) If proposed corporate action creating dissenters’ rights under s. 180.1302 is submitted to a vote at a shareholders’ meeting, a shareholder or beneficial shareholder who wishes to assert dissenters’ rights shall do all of the following:

(a) Deliver to the issuer corporation before the vote is taken written notice that complies with s. 180.0141 of the shareholder’s or beneficial shareholder’s intent to demand payment for his or her shares if the proposed action is effectuated.

(b) Not vote his or her shares in favor of the proposed action.

(2) A shareholder or beneficial shareholder who fails to satisfy sub. (1) is not entitled to payment for his or her shares under ss. 180.1301 to 180.1331.

180.1322 Dissenters’ notice.

(1) If proposed corporate action creating dissenters’ rights under s. 180.1302 is authorized at a shareholders’ meeting, the corporation shall deliver a written dissenters’ notice to all shareholders and beneficial shareholders who satisfied s. 180.1321.

(2) The dissenters’ notice shall be sent no later than 10 days after the corporate action is authorized at a shareholders’ meeting or without a vote of shareholders, whichever is applicable. The dissenters’ notice shall comply with s. 180.0141 and shall include or have attached all of the following:

(a) A statement indicating where the shareholder or beneficial shareholder must send the payment demand and where and when certificates for certificated shares must be deposited.

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(b) For holders of uncertificated shares, an explanation of the extent to which transfer of the shares will be restricted after the payment demand is received.

(c) A form for demanding payment that includes the date of the first announcement to news media or to shareholders of the terms of the proposed corporate action and that requires the shareholder or beneficial shareholder asserting dissenters’ rights to certify whether he or she acquired beneficial ownership of the shares before that date.

(d) A date by which the corporation must receive the payment demand, which may not be fewer than 30 days nor more than 60 days after the date on which the dissenters’ notice is delivered.

(e) A copy of ss. 180.1301 to 180.1331.

180.1323 Duty to demand payment.

(1) A shareholder or beneficial shareholder who is sent a dissenters’ notice described in s. 180.1322, or a beneficial shareholder whose shares are held by a nominee who is sent a dissenters’ notice described in s. 180.1322, must

demand payment in writing and certify whether he or she acquired beneficial ownership of the shares before the date specified in the dissenters’ notice under s. 180.1322 (2) (c). A shareholder or beneficial shareholder with certificated shares must also deposit his or her certificates in accordance with the terms of the notice.

(2) A shareholder or beneficial shareholder with certificated shares who demands payment and deposits his or her share certificates under sub. (1) retains all other rights of a shareholder or beneficial shareholder until these rights are canceled or modified by the effectuation of the corporate action.

(3) A shareholder or beneficial shareholder with certificated or uncertificated shares who does not demand payment by the date set in the dissenters’ notice, or a shareholder or beneficial shareholder with certificated shares who does not deposit his or her share certificates where required and by the date set in the dissenters’ notice, is not entitled to payment for his or her shares under ss. 180.1301 to 180.1331.

180.1324 Restrictions on uncertificated shares.

(1) The issuer corporation may restrict the transfer of uncertificated shares from the date that the demand for payment for those shares is received until the corporate action is effectuated or the restrictions released under s. 180.1326.

(2) The shareholder or beneficial shareholder who asserts dissenters’ rights as to uncertificated shares retains all of the rights of a shareholder or beneficial shareholder, other than those restricted under sub. (1), until these rights are canceled or modified by the effectuation of the corporate action.

180.1325 Payment.

(1) Except as provided in s. 180.1327, as soon as the corporate action is effectuated or upon receipt of a payment demand, whichever is later, the corporation shall pay each shareholder or beneficial shareholder who has complied with s. 180.1323 the amount that the corporation estimates to be the fair value of his or her shares, plus accrued interest.

(2) The payment shall be accompanied by all of the following:

(a) The corporation’s latest available financial statements, audited and including footnote disclosure if available, but including not less than a balance sheet as of the end of a fiscal year ending not more than 16 months before the date of payment, an income statement for that year, a statement of changes in shareholders’ equity for that year and the latest available interim financial statements, if any.

(b) A statement of the corporation’s estimate of the fair value of the shares.

(c) An explanation of how the interest was calculated.

(d) A statement of the dissenter’s right to demand payment under s. 180.1328 if the dissenter is dissatisfied with the payment.

(e) A copy of ss. 180.1301 to 180.1331.

180.1326 Failure to take action.

(1) If an issuer corporation does not effectuate the corporate action within 60 days after the date set under s. 180.1322 for demanding payment, the issuer corporation shall return the deposited certificates and release the transfer restrictions imposed on uncertificated shares.

(2) If after returning deposited certificates and releasing transfer restrictions, the issuer corporation effectuates the corporate action, the corporation shall deliver a new dissenters’ notice under s. 180.1322 and repeat the payment demand procedure.

180.1327 After-acquired shares.

(1) A corporation may elect to withhold payment required by s. 180.1325 from a dissenter unless the dissenter was the beneficial owner of the shares before the date specified in the dissenters’ notice under s. 180.1322 (2) (c) as the date of the first announcement to news media or to shareholders of the terms of the proposed corporate action.

(2) To the extent that the corporation elects to withhold payment under sub. (1) after effectuating the corporate action, it shall estimate the fair value of the shares, plus accrued interest, and shall pay this amount to each dissenter who agrees to accept it in full satisfaction of his or her demand. The corporation shall send with its offer a statement of its estimate of the fair value of the shares, an explanation of how the interest was calculated, and a statement of the dissenter’s right to demand payment under s. 180.1328 if the dissenter is dissatisfied with the offer.

180.1328 Procedure if dissenter dissatisfied with payment or offer.

(1) A dissenter may, in the manner provided in sub. (2), notify the corporation of the dissenter’s estimate of the fair value of his or her shares and amount of interest due, and demand payment of his or her estimate, less any payment received under s. 180.1325, or reject the offer under s. 180.1327 and demand payment of the fair value of his or her shares and interest due, if any of the following applies:

(a) The dissenter believes that the amount paid under s. 180.1325 or offered under s. 180.1327 is less than the fair value of his or her shares or that the interest due is incorrectly calculated.

(b) The corporation fails to make payment under s. 180.1325 within 60 days after the date set under s. 180.1322 for demanding payment.

(c) The issuer corporation, having failed to effectuate the corporate action, does not return the deposited certificates or release the transfer restrictions imposed on uncertificated shares within 60 days after the date set under s. 180.1322 for demanding payment.

(2) A dissenter waives his or her right to demand payment under this section unless the dissenter notifies the corporation of his or her demand under sub. (1) in writing within 30 days after the corporation made or offered payment for his or her shares. The notice shall comply with s. 180.0141.

180.1330 Court action.

(1) If a demand for payment under s. 180.1328 remains unsettled, the corporation shall bring a special proceeding within 60 days after receiving the payment demand under s. 180.1328 and petition the court to determine the fair value of the shares and accrued interest. If the corporation does not bring the special proceeding within the 60-day period, it shall pay each dissenter whose demand remains unsettled the amount demanded.

(2) The corporation shall bring the special proceeding in the circuit court for the county where its principal office or, if none in this state, its registered office is located. If the corporation is a foreign corporation without a registered office in this state, it shall bring the special proceeding in the county in this state in which was located the registered office of the issuer corporation that merged with or whose shares were acquired by the foreign corporation.

(3) The corporation shall make all dissenters, whether or not residents of this state, whose demands remain unsettled parties to the special proceeding. Each party to the special proceeding shall be served with a copy of the petition as provided in s. 801.14.

(4) The jurisdiction of the court in which the special proceeding is brought under sub. (2) is plenary and exclusive. The court may appoint one or more persons as appraisers to receive evidence and recommend decision on the question of fair value. An appraiser has the power described in the order appointing him or her or in any amendment to the order. The dissenters are entitled to the same discovery rights as parties in other civil proceedings.

(5) Each dissenter made a party to the special proceeding is entitled to judgment for any of the following:

(a) The amount, if any, by which the court finds the fair value of his or her shares, plus interest, exceeds the amount paid by the corporation.

(b) The fair value, plus accrued interest, of his or her shares acquired on or after the date specified in the dissenter’s notice under s. 180.1322 (2) (c), for which the corporation elected to withhold payment under s. 180.1327.Contents

 

Exhibit A

180.1331 Court costs and counsel fees.

(1)

(a) Notwithstanding ss. 814.01 to 814.04, the court in a special proceeding brought under s. 180.1330 shall determine all costs of the proceeding, including the reasonable compensation and expenses of appraisers appointed by the court and shall assess the costs against the corporation, except as provided in par. (b).

(b) Notwithstanding ss. 814.01 and 814.04, the court may assess costs against all or some of the dissenters, in amounts that the court finds to be equitable, to the extent that the court finds the dissenters acted arbitrarily, vexatiously or not in good faith in demanding payment under s. 180.1328.

(2) The parties shall bear their own expenses of the proceeding, except that, notwithstanding ss. 814.01 to 814.04, the court may also assess the fees and expenses of counsel and experts for the respective parties, in amounts that the court finds to be equitable, as follows:

(a) Against the corporation and in favor of any dissenter if the court finds that the corporation did not substantially comply with ss. 180.1320 to 180.1328.

(b) Against the corporation or against a dissenter, in favor of any other party, if the court finds that the party against whom the fees and expenses are assessed acted arbitrarily, vexatiously or not in good faith with respect to the rights provided by this chapter.

(3) Notwithstanding ss. 814.01 to 814.04, if the court finds that the services of counsel and experts for any dissenter were of substantial benefit to other dissenters similarly situated, the court may award to these counsel and experts reasonable fees to be paid out of the amounts awarded the dissenters who were benefited.

Annex CVoting Agreement

Voting Agreement

This AgreementTHIS AGREEMENT (“Agreement”) is made and entered into as of the 13th5th day of October, 2014,June, 2019, by and between the undersigned shareholders (each, a“Shareholder,” and collectively, the“Shareholders”) of Delavan Bancshares, Inc.STC BANCSHARES CORP., a Wisconsinan Illinois corporation (theCompany”), and Wintrust Financial Corporation,WINTRUST FINANCIAL CORPORATION, an Illinois corporation (“Wintrust”).

Witnesseth:

Whereas,WITNESSETH:

WHEREAS, the Company and Wintrust, together with Wintrust’sWTFC STCBC Merger Sub LLC, an Illinois limited liability company and wholly owned subsidiary of Wintrust Merger Co. (“Merger Co.”), have entered into an Agreement and Plan of Merger dated as of the date hereof (the“Merger Agreement”) (capitalized terms used but not defined in this Agreement shall have the meanings given them in the Merger Agreement);

Whereas,

WHEREAS, as a condition to Wintrust’sWintrust and Merger Co.’s willingness being willing to enter into the Merger Agreement, and as an as inducement and in consideration therefor, each of the Shareholders shall has agreed to executedexecute and deliver this Agreement, solely in their capacitieshis, her or its capacity as shareholdersa shareholder of the Company; and

Whereas,

WHEREAS, each Shareholder owns and is entitled to vote the number of issued and outstanding shares of common stock of the Company (the“Company Common Stock”), as set forth opposite such Shareholder’s name on Schedule 1 attached hereto, and has agreed to vote such Shareholder’s Company Common Stock pursuant to the terms set forth in this Agreement.

Now, Therefore,

NOW, THEREFORE, in consideration of the premises and the respective representations, warranties, covenants and agreements set forth herein, the Shareholders and Wintrust hereby agree as follows:

Section 1.Voting of Shares.  Each Shareholder hereby agrees that at any meeting of the shareholders of the Company, and at every adjournment or postponement thereof, and in any action by written consent of the shareholders of the Company, such Shareholder shall appear or otherwise cause theall shares of Company Common Stock (including any shares obtained as a result of exercising one or more Company stock options) which such Shareholder owns and is entitled to vote to be counted as present for purposes of establishing a quorum at any such meeting of the shareholders of the Company, and shall vote theall shares of Company Common Stock which such Shareholder owns and is entitled to vote (a) in favor of the adoption and approval of the Merger Agreement and the transactions contemplated thereby, (b) in favor of the approval of any proposal to adjourn or postpone the meeting to a later date, if requested by Wintrust or Merger Co., (c) against any action, proposal, transaction or agreement which would result in a breach of any term of, or any other obligation of the Company under, the Merger Agreement, (d) against any action or agreement which would impede, interfere with, prevent or attempt to discourage the transactions contemplated by the Merger Agreement, including, but not limited to, any other extraordinary corporate transaction, including, but not limited to, a merger, acquisition, sale, consolidation, reorganization, recapitalization, extraordinary dividend or liquidation involving the Company the Bank or the Bank Subsidiary and any Person (other than Wintrust, Merger Co. or their respective affiliates), or any other proposal of any Person (other than Wintrust, Merger Co. or their respective affiliates) to acquire the Company or the Bank the Bank Subsidiary or all or substantially all of the respective assets thereof, (e) against any AcquisitionCompany Takeover Proposal, and (f) in favor orof any other matter necessary for consummation of the transactions contemplated by the Merger Agreement;provided,however, that nothing in this Agreement shall prevent, limit or affect any actions or omissions taken by a Shareholder

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Table of Contents

who may also serve as a director and/or officer of the Company fromin the course of discharging his or her fiduciary duties to the Company in his or her capacity as a director.director and/or officer, and no such actions or omissions shall be deemed to be a breach of this Agreement.  Each Shareholder agrees that the Company shall be authorized to include in any proxy or material transmitted to shareholders of the Company or filed with the Commission or any other Governmental Authority or any press release or other document that Wintrust or Merger Co. reasonably determines to be necessary in connection with the transactions contemplated by the Merger Agreement, such Shareholder’s identity and ownership of Company Common Stock, and a statement to the effect that the Shareholder is a party to this Agreement and has committed to vote in favor of the transactions contemplated by the Merger Agreement (the “Shareholder Information”).  Each of the Shareholders agrees to promptly give Wintrust any Shareholder Information it may reasonably require for the preparation of any such documents, and each of the Shareholders agrees to promptly notify Wintrust of any required corrections with respect to any written Shareholder Information supplied by it specifically for use in any such document, if and to the extent that the Shareholder shall become aware that any Shareholder Information shall have become false or misleading in any material respect.


Section 2.Term of Agreement.  This Agreement shall be effective from the date hereof and shall terminate and be of no further force and effect upon the earlier of (i) the Effective Time (as defined in the Merger Agreement), or (ii) the termination of the Merger Agreement in accordance with its terms, which includes termination of the Merger Agreement by the Company pursuant to Section 9.2(e)9.2 of the Merger Agreement, but shall in no event be effective for longer than twenty-five (25) years.  Nothing in this Section 2 shall relieve any party of liability for breach of this Agreement.

Section 3.Covenants of Shareholders.  Each Shareholder agrees not to: except to the extent containedrequired by this Agreement or in this Agreement,the event of the death or permanent disability of Shareholder, alter, transfer, sell, assign, gift, hedge, pledge or otherwise dispose (whether by sale, liquidation, dissolution, dividend, distribution, or otherwise) of, or enter into any derivative arrangement with respect to (collectively,(each, aTransfer”), any or all of such Shareholder’s Company Common Stock or any right or interest therein (or consent to any of the foregoing); enter into any contract or agreement with respect to any Transfer of any or all of such Shareholder’s Company Common Stock or any right or interest therein; grant any proxies, deposit any Company Common Stock into a voting trust or enter into a voting agreement (except pursuant to this Agreement), in each case with respect to any shares of Company Common Stock; create or permit to exist any Encumbrance on any or all of such Shareholder’s Company Common Stock; take or permit any other action that would in any way restrict, limit or interfere with the performance of such Shareholder’s obligations hereunder or the transactions contemplated hereby or otherwise make any representation or warranty of such Shareholder herein untrue or incorrect in any material respect; or without the prior written approval of Wintrust, directly or indirectly, solicit, initiate, encourage or facilitate any AcquisitionCompany Takeover Proposal or enter into any agreement with respect to, or initiate or participate in any negotiations or discussions with any Person concerning any AcquisitionCompany Takeover Proposal, or furnish any information to any Person proposing or seeking an AcquisitionCompany Takeover Proposal.  Each Shareholder hereby agrees, while this Agreement is in effect, to promptly notify Wintrust of the number of any new shares of Company Common Stock acquired by such Shareholder, if any, after the date hereof.  Any such Company Common Stock shall be subject to the terms of this Agreement as though owned by such Shareholder on the date hereof.  Notwithstanding anything contained in this Agreement toIf Transfer of ownership is occasioned by the contrary, at any time prior to the Closing, each Shareholder shall be permitted to Transfer ownership and voting rights of up to an aggregate of two percent (2%)death or permanent disability of such Shareholder’s Company Common Stock listed as owned on Schedule 1 to a family member of such Shareholder, without obtaining Wintrust’s prior consent or approval of such transfer;provided,however, that prior to any such Transfer, such Shareholder or his or her representative shall cause such family memberthe transferee to agree to be bound by the terms and conditions of this Agreement and to execute a joinder to this Agreement. For purposes

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Table of the preceding sentence, “family member” shall mean any child, step-child, grandchild, parent, step-parent, grandparent, spouse, sibling, nephew, niece, mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law or sister-in-law and shall include adoptive relationships.Contents

Section 4.No Exercise of Dissenters’ Rights; Actions.   Each of the Shareholders (a) waives and agrees not to demand appraisal of such Shareholder’s Company Common Stock pursuant to the WBCLIBCA and (b) agrees not to commence or join in, and agrees to take all actions necessary to opt out of, any class in any class action with respect to, any claim, derivative or otherwise, against Wintrust, Merger Co., the Company or any of their respective representatives (i) challenging the validity of, or seeking to enjoin the operation of, any provision of this Agreement or (ii) alleging breach of any fiduciary duty of any Person in connection with the negotiation and entry into, the Merger Agreement.

Section 5.Representations and Warranties of Shareholders.  Each Shareholder represents and warrants to Wintrust as follows:  (a) such Shareholder owns, and is entitled to vote in accordance with such Shareholder’s commitments under this Agreement, the number of shares and applicable classes and series of Company Common Stock set forth opposite his, her or herits name on Schedule 1 hereto, and does not own or have any right to acquire any Company Common Stock not listed on Schedule 1; (b) such Shareholder has the right, power and authority to execute, deliver and perform under this Agreement; such execution, delivery and performance will not violate, or require any consent, approval, or notice under any provision of law or result in the breach of any outstanding agreements or instruments to which such Shareholder is a party or is subject; and this Agreement has been duly executed and delivered by such Shareholder and constitutes a legal, valid and binding agreement of such Shareholder, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors generally and to general principles of equity; (c) except as set forth in the next sentence, such Shareholder’s shares of Company Common Stock listed as owned on Schedule 1 hereto are now and will remain owned by such Shareholder, free and clear of all voting trusts, voting agreements, proxies, liens, claims, liabilities, security

interests, marital property rights or any other encumbrancesEncumbrances whatsoever (other than (i) pledges for loans entered into in the ordinary course and (ii) rights of Wintrust and encumbrancesEncumbrances respecting such Company Common Stock created pursuant to this Agreement or the Merger Agreement); (d) other than set forth on Schedule 1 to this Agreement and in the Merger Agreement, there are no outstanding options, warrants or rights to purchase or acquire, or agreements related to, such Shareholder’s Company Common Stock; (e) there are no claims, actions, suits or proceedings pending or, to the knowledge of such Shareholder, threatened or contemplated against or affecting such Shareholder, at law or in equity, or before any federal, state or other Governmental Authority or any arbitrator or arbitration panel, whether by contract or otherwise, and there is no decree, judgment or order or formal supervisory agreement of any kind in existence against or restraining such Shareholder from taking any action of any kind in connection with their respective properties or assets (including such Shareholder’s Company Common Stock) that would reasonably be expected to prevent or materially delay or impair the consummation of the transactions contemplated by this Agreement or the Merger Agreement or otherwise adversely impact such Shareholder’s ability to perform its obligations hereunder in any material respect; and (e)(f) such Shareholder has had the opportunity to review the Merger Agreement and this Agreement with counsel of such Shareholder’s own choosing, and such Shareholder understands and acknowledges that Wintrust and Merger Co. areis entering into the Merger Agreement in reliance upon such Shareholder’s execution, delivery and performance of this Agreement.

Section 6.Representations and Warranties of Wintrust.  Wintrust has the right, power and authority to execute and deliver this Agreement; such execution and delivery will not violate, or require any consent, approval, or notice under any provision of law or result in the breach of any outstanding agreements or instruments to which Wintrust is a party or is subject; and this Agreement has been duly executed and delivered by Wintrust and constitutes a legal, valid and binding agreement of Wintrust,

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enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors generally and to general principles of equity.

Section 7.Transferability.  Neither this Agreement nor any of the rights, interests or obligations hereunder shall be assigned by any of the parties hereto (whether by operation of law or otherwise) without the prior written consent of the other parties, except that Wintrust may assign this Agreement to a direct or indirect wholly ownedwholly-owned subsidiary or affiliate of Wintrust,provided that no such assignment shall relieve Wintrust of its obligations hereunder.

Section 8.Specific Performance.  The parties hereto agree that irreparable damage would occur in the event that any of the provisions of this Agreement was not performed by any of the Shareholders in accordance with its specific terms or was otherwise breached.  It is accordingly agreed that Wintrust shall (without any requirement for the posting of any bond) be entitled to injunctive relief to prevent breaches of this Agreement by the Shareholders and to enforce specifically the terms and provisions hereof in addition to any other remedy to which Wintrust is entitled at law or in equity.

Section 9.Further Assurances.  Each Shareholder agrees to execute and deliver all such further documents and instruments and take all such further action as may be necessary or appropriate in order to consummate the transactions contemplated hereby.

Section 10.Entire Agreement and Amendment.

(a)                                 Except for the Merger Agreement and its ancillary agreements and instruments, this Agreement contains the entire agreement between the parties hereto with respect to the transactions contemplated hereunder and supersedes all prior arrangements or understandings with respect hereto.  The parties acknowledge and agree that the covenants and agreements of each Shareholder made herein are for the benefit of Wintrust, and at any time Wintrust may (without the consent of any Shareholder) (i) extend the time for the performance of any of the obligations or other acts of any Shareholder, (ii) waive any inaccuracies in any Shareholder’s representations and warranties contained in this Agreement or in any document delivered pursuant to this Agreement or (iii) waive compliance with any of a Shareholder’s agreements or conditions contained in this Agreement. Any agreement by Wintrust to any such extension or waiver shall be valid only if set forth in an instrument in writing signed on behalf of Wintrust. The failure of any party to this Agreement to assert any of its rights under this Agreement or otherwise shall not constitute a waiver of such rights. Each Shareholder agrees that Wintrust may, in its sole discretion, exercise its rights against some, but not all, Shareholders. For any matter under this Agreement requiring the consent or approval of any party, such consent or approval shall be valid and binding on a party hereto only if such consent or approval is delivered in an instrument in writing signed on behalf of such party.

(b)                     This Agreement may not be modified, amended, altered or supplemented except upon the execution and delivery of a written agreement executed by the parties hereto.

Section 11.Notices.  Each notice, demand or other communication which may be or is required to be given under this Agreement shall be in writing and shall be deemed to have been properly given when delivered personally at the address set forth herein for Wintrust or the address on Schedule 1 for each of the Shareholders,a Shareholder, when sent by facsimile or other electronic transmission to the respective facsimile transmission numbers of the partiesa party with telephone confirmation of receipt, or the day after sending by recognized overnight courier or if by the United States registered or certified mail, return receipt requested, postage prepaid two days after deposit therein.

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Section 12.General Provisions.  This Agreement shall be governed by the laws of the State of Wisconsin.Illinois, without giving effect to the conflicts of laws principles thereof. Each of the parties hereto (a) consents to submit itself to the personal jurisdiction of any Illinois state court located in Chicago, Illinois or any Federal court located in Chicago, Illinois (or any court with appellate jurisdiction therefrom) in the event any dispute arises out of this Agreement or the transactions contemplated hereby, (b) agrees that it will not attempt to deny or defeat such personal jurisdiction by motion or other request for leave from any such court, (c) agrees that it will not bring any action relating to this Agreement or the transactions contemplated hereby in any court other than any Illinois state court located in Chicago, Illinois or any Federal court sitting in the State of Illinois and (d) waives any right to trial by jury with respect to any action related to or arising out of this Agreement or the transactions contemplated hereby. This Agreement may be executed in counterparts, each of which shall be deemed to be an original.  Headings are for convenience only and shall not affect the meaning of this Agreement.  Any term of this Agreement which is invalid or unenforceable shall be ineffective only to the extent of such invalidity or unenforceability without rendering invalid or unenforceable the remaining terms of this Agreement.  The parties have participated jointly in the negotiation and drafting of this Agreement. In the event of an ambiguity or question of intent or interpretation arises, this Agreement will be construed as if drafted jointly by the parties and no presumption or burden of proof will arise favoring or disfavoring any party by virtue of the authorship of any provision of this Agreement. The rights and remedies of any person under this Agreement are not exclusive of or limited by any other rights or remedies which it may have, whether at law, in equity, by contract or otherwise, all of which shall be cumulative (and not alternative). The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective representatives, successors and assigns. In any action, suit or other proceeding relating to this Agreement or the enforcement of any provision of this Agreement, the prevailing party in such action, suit or other proceeding shall be entitled to recover reasonable attorneys’ fees, costs and disbursements (in addition to any other relief to which such prevailing party may be entitled) from the non-prevailing party or parties.

Section 13.Legal Counsel. Each Shareholder acknowledges that he, she or it has been advised to, and has had the opportunity to consult with his, her or its personal attorney prior to entering into this Agreement. Each Shareholder further acknowledges that attorneys for the Company represent the Company and do not represent such Shareholder or any other shareholder of the Company in connection with the Merger Agreement, this Agreement or any of the transactions contemplated hereby or thereby.

[SIGNATURE PAGE FOLLOWS]

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written.

 

WINTRUST FINANCIAL CORPORATION, an Illinois Corporation

Wintrust Financial Corporation, an Illinois Corporation:

By:

/s/ David A. Dykstra

Its:

Senior Executive Vice President and COO

 

Address for Notices:

With a copy to

Wintrust Financial Corporation

Matthew G. Galo

9700 W. Higgins Road, Suite 800

Schiff Hardin LLP

Rosemont, Illinois 60018

233 S. Wacker Drive, Suite 6600

7100

Attn: Lisa J. Pattis

Kathleen M. Boege

Chicago, Illinois 60606-6473

Executive Vice President, General Counsel and Corporate Secretary

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SHAREHOLDERS:

General CounselAnthony V. Sisto

Christopher Woelffer

Eduardo E. Greco

Edward N. Levato Sr.

Keith Kotche

Gregory Licht

James D. Parrilli Jr.

Charles S. Wolande

W. Philip Wilmington

Signature Page to Voting Agreement

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SCHEDULE 1

SHAREHOLDER NAME

RECORD OWNER OF
SHARES

NUMBER OF SHARES
OF COMPANY
COMMON STOCK
OWNED BY
SHAREHOLDER

ADDRESS FOR NOTICES

Anthony V. Sisto

Anthony V. Sisto

34,790

Christopher Woelffer

Christopher Woelffer

5,000

Eduardo E. Greco

Eduardo E. Greco

13,557

Edward N. Levato Sr.

Edward N. Levato Sr. or Darlene Levato

11,500

Daniella DeMoon and/or Edward N. Levato Sr. (JTWOS)

6,206

Kristen Levato and/or Edward N. Levato Sr. (JTWOS)

7,206

Salvatore R. Levato or Anna Levato or Edward N. Levato Sr.

1,000

Frank A. Levato or Edward N. Levato Sr.

1,000

Edward N. Levato Jr. or Edward N. Levato Sr.

6,206

Keith Kotche

Keith or Joni Kotche (JTWROS)

24,433

Keith Kotche and/or Joni Kotche and/or Drew Kotche (JTWROS)

1,095

Keith Kotche and/or Joni Kotche and/or Victoria Maas (JTWROS)

1,095

Keith Kotche and/or Joni Kotche and/or Margaret Colliander (JTWROS)

1,095

Robert J. Kotche or Eileen Kotche or Keith Kotche

100

Glenn Kotche or Miri Kotche or Keith Kotche

100

Gregory Licht

Gregory Licht

10,000

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James D. Parrilli Jr.

James D. Parrilli Jr.

14,285

Charles S. Wolande

Charles S. Wolande

38,819

Charles S. Wolande 2012 Family Trust

4,300

W. Philip Wilmington

W. Philip or Julie Wilmington (JTWROS)

24,000

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Exhibit B

Form of Escrow Agreement

This Escrow Agreement (“Escrow Agreement”) is made and entered into as of [    ], 2019 (the “Effective Date”) by and among Wintrust Financial Corporation, an Illinois corporation (“Wintrust”),  Anthony V. Sisto, not personally but as the exclusive agent (including any successors thereof, the “Shareholders’ Representative”) of the shareholders of STC Bancshares Corp., an Illinois corporation (the “Company”), and The Chicago Trust Company, N.A., a national association (the “Escrow Agent”).

RECITALS

WHEREAS, Wintrust, WTFC STCBC Merger Sub LLC, an Illinois limited liability company and wholly owned subsidiary of Wintrust (“Merger Sub”), and the Company are parties to that certain Agreement and Plan of Merger, dated as of June 5, 2019 (the “Merger Agreement”), a copy of which is attached hereto as Exhibit A.  The Merger Agreement provides for, among other things, the merger of the Company with and into Merger Sub, whereupon the separate existence of the Company shall cease.  Capitalized terms used but not otherwise defined in this Escrow Agreement have the meanings given to them in the Merger Agreement.

WHEREAS, Sections 1.4 and 1.10(a) of the Merger Agreement provide that at Closing, Wintrust shall deposit a portion of the Merger Consideration in cash in the amount of $2,500,000 into an escrow account for the purpose of funding (i) the obligations of the Company to indemnify and hold the Wintrust Indemnified Parties harmless with respect to Claims that may arise or result from certain matters as further set forth in Section 8.2(a) of the Merger Agreement and (ii) supplementing the Reserve Account, to the extent deemed necessary by the Shareholders’ Representative, in an amount not to exceed $500,000, as further described in Sections 1.10 and 1.11 of the Merger Agreement.  Such Escrow Amount shall be held pursuant to this Escrow Agreement until such time as it may be released in accordance with the terms hereunder pro rata to the shareholders of the Company as a portion of the Per Share Escrowed Consideration.

WHEREAS, Anthony V. Sisto was appointed Shareholders’ Representative by all necessary corporate and shareholder action of the Company at the Shareholders’ Meeting held pursuant to the Merger Agreement on [    ], 2019.  Such appointment included (i) authorization to act on behalf of all holders of Company Common Stock Outstanding (the “Shareholders”) in connection with the indemnification obligations of the Company set forth in Article VIII of the Merger Agreement, including actions to be taken pursuant to this Escrow Agreement, (ii) indemnification by the Shareholders with respect to any actions that may be taken by the Shareholders’ Representative pursuant to this Escrow Agreement on behalf of all of the Shareholders, and (iii) acknowledgment that Wintrust and the Wintrust Indemnified Parties may rely on all such actions taken by the Shareholders’ Representative in such capacities.

AGREEMENT

NOW, THEREFORE, in consideration of the mutual covenants, agreements, representations and warranties herein contained, the parties agree as follows:

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1.Establishment of Escrow Account.

1.1Appointment of Escrow Agent; Deposit of Funds.  Wintrust and the Shareholders’ Representative hereby appoint the Escrow Agent to act in accordance with the express terms and provisions of this Escrow Agreement, and the Escrow Agent hereby accepts such appointment on the express terms and provisions of this Escrow Agreement.  At Closing, Wintrust shall deposit or cause to be deposited with the Escrow Agent on behalf of the Shareholders $2,500,000 in immediately available funds (such amount is referred to hereafter as the “Escrow Amount”).

1.2Power to Transfer Escrow.  The Escrow Agent is hereby granted the power and is directed to effect any transfer of any portion of the Escrow Amount as provided for in this Escrow Agreement.

1.3Establishment of Escrow Account; Non-Interest Bearing.  As of the Effective Date, the Escrow Agent shall deposit the Escrow Amount into an escrow account (the “Escrow Account”), which shall be a non-interest bearing account.  The Escrow Agent hereby agrees to maintain and disburse funds held in the Escrow Account as provided in this Escrow Agreement, which account shall be held and maintained in a manner consistent with Escrow Agent’s other non-interest bearing accounts.  The Escrow Agent shall hold and safeguard the Escrow Amount and the Escrow Account during the term of this Escrow Agreement, shall treat the Escrow Amount in accordance with the terms of this Escrow Agreement and not as the property of Wintrust or the Shareholders’ Representative, and shall hold and dispose of the Escrow Amount only in accordance with the express terms of this Escrow Agreement.

2.Disbursement of Escrow Amount.  Subject to Section 3 below, on [           ], 201[](1) (the “Release Date”), of which date the Escrow Agent and the Shareholders’ Representative shall be notified in writing by Wintrust, the Escrow Agent shall distribute to the Exchange Agent, on behalf of the Shareholders, an amount equal to (a) the amount of the then-remaining Escrow Amount, minus (b) the aggregate dollar amount of all pending Indemnity Claims, as defined in Section 3.1 below (the “Pending Claim Amount”), minus (c) the aggregate dollar amount of any claims pursuant to Section 6.3 below, which amount shall be deposited into the Reserve Account promptly after the Release Date (such net amount, the “Escrow Disbursement”), by wire transfer in accordance with wire instructions provided by Wintrust and the Shareholders’ Representative to the Escrow Agent.  The Exchange Agent shall then promptly distribute the Escrow Disbursement to the Shareholders as a portion of the Per Share Escrowed Consideration, calculated by dividing the total Escrow Disbursement by the number of shares of Company Common Stock Outstanding immediately prior to the Effective Time.  Distributions to the Shareholders shall be made using the instructions previously provided by each Shareholder to the Exchange Agent in such Shareholder’s Letter of Transmittal delivered in accordance with the Merger Agreement, unless such delivery instructions are modified in writing in accordance with the terms of each such Letter of Transmittal.


(1)   Final Escrow Agreement to insert date which is the last day of the 15th calendar month following the month in which the Closing Date occurs (see Section 1.10 of the Merger Agreement).

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3.Indemnity Claims and Release Administration.

3.1Indemnity Claims against Escrow Amount.

(a)                                 In the event and to the extent Wintrust makes a Claim or Claims for which a Wintrust Indemnified Party is entitled to indemnification pursuant to Article VIII of the Merger Agreement (an “Indemnity Claim”), Wintrust shall issue or cause to be issued a written notice (“Indemnity Claim Notice”) to the Shareholders’ Representative and the Escrow Agent setting forth the details of the Indemnity Claim, including: (i) the fact that Wintrust has suffered, or anticipates suffering, an Indemnity Claim; (ii) a specification of the amount of the actual or anticipated Indemnity Claim (including estimated amounts of expenses or costs to be incurred by Wintrust, including reasonable attorneys’ fees, as contemplated by Section 8.2(a)(ii) of the Merger Agreement in connection with such Indemnity Claim or Claims, but subject to such limitations set forth in Section 8.2(d) of the Merger Agreement), including a reference to the applicable section(s) of the Merger Agreement; (iii) a description of the facts giving rise to the actual or anticipated Indemnity Claim, including a reference to the applicable section(s) of the Merger Agreement; (iv) a direction that the Escrow Agent deliver, subject to Sections 3.1(b) and 3.1(c) hereof, an amount equal to such actual or anticipated Indemnity Claim in immediately available funds to Wintrust from the Escrow Account to the extent available, or, if the Indemnity Claim amount is greater than the amount of the Escrow Account, the entire amount of funds in the Escrow Account; and (v) wire transfer instructions for such amount.

(b)                                 If the Shareholders’ Representative does not deliver an Indemnity Objection Notice (as defined in the next sentence) to the Escrow Agent and Wintrust on or before the date which is thirty (30) calendar days after the date of the Shareholders’ Representative’s receipt of the Indemnity Claim Notice, Wintrust may give unilateral written notice to the Escrow Agent to release from the Escrow Account the amount set forth in the Indemnity Claim Notice to the extent available, and, upon its receipt of such notice, the Escrow Agent shall deliver to Wintrust that portion of the Escrow Amount in the amount stated in, and in accordance with the terms of, the Indemnity Claim Notice.  An “Indemnity Objection Notice” shall mean a written notice from the Shareholders’ Representative to Wintrust and the Escrow Agent which sets forth: (i) an objection to delivery of all or any portion of the Escrow Amount claimed in the Indemnity Claim Notice; (ii) a description of the facts which constitute the basis for the objection, and (iii) a description of the applicable section(s) of the Merger Agreement which support the basis for such objection.

(c)                                  If an Indemnity Objection Notice is timely received, the Escrow Agent thereafter shall not make the delivery of the contested portion of the applicable Indemnity Claim except in accordance with a Final Determination (as defined below).  If the contested portion of the Indemnity Claim is greater than the amount of the funds in the Escrow Account, the Escrow Agent shall retain the entire amount of the Escrow Account until authorized to release such funds from the Escrow Account.

3.2Release Administration.

(a)                                 No fewer than five (5) business days prior to the Release Date, Wintrust shall issue or cause to be issued a written notice (“Release Notice”) to the Shareholders’

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Representative and the Escrow Agent instructing the Escrow Agent to deliver to the Exchange Agent, on behalf of the Shareholders, the amount of the Escrow Amount to be released thereon, calculated as set forth in Section 2.  If a Release Notice is not received, the Shareholders’ Representative shall notify Wintrust of such omission.

(b)                                 If Wintrust indicates in its Release Notice that the full amount remaining in the Escrow Account shall be paid to the Exchange Agent on behalf of the Shareholders, and if the Shareholders’ Representative notifies Wintrust and the Escrow Agent in writing that it has no claims under Section 6.3, then Wintrust may give unilateral written notice to the Escrow Agent to release the Escrow Amount in the amount stated in, and accordance with the terms of, the Release Notice, calculated as set forth in Section 2.

(c)                                  If (i) Wintrust indicates in its Release Notice that less than the full amount remaining in the Escrow Account shall be paid to the Exchange Agent on behalf of the Shareholders, (ii) the Shareholders’ Representative does not deliver a Release Objection Notice (as defined below) to the Escrow Agent and Wintrust on or before the date which is fifteen (15) days after the date of the Shareholders’ Representative’s receipt of the Release Notice, and (iii) the Shareholders’ Representative notifies Wintrust and the Escrow Agent in writing that it has no claims under Section 6.3, then Wintrust may give unilateral written notice to the Escrow Agent to release such portion of the Escrow Amount to the Exchange Agent on behalf of the Shareholders or Wintrust, as the case may be, in the amount stated in, and accordance with the terms of, the Release Notice, calculated as set forth in Section 2.

(d)                                 If a Release Objection Notice is timely received, the Escrow Agent thereafter shall not make the delivery of any contested portion of the Escrow Amount except in accordance with a Final Determination (as defined below).  The Escrow Agent shall have no duty or obligation with respect to the Final Determination unless and until it receives written notice of the occurrence.

3.3Certain Definitions.

(a)                                 A “Release Objection Notice” shall mean a written notice from the Shareholders’ Representative to Wintrust and the Escrow Agent which sets forth:  (i) an objection to delivery (or non-delivery, as the case may be) of all or any portion of the Escrow Amount in accordance with the terms of the Release Notice; (ii) a description of the facts which constitute the basis for the objection and (iii) reference to the applicable section(s) of the Merger Agreement which support the Shareholders’ Representative’s objection.

(b)                                 A “Final Determination” means: (i) joint written instructions executed by Wintrust and the Shareholders’ Representative; (ii) a settlement agreement between Wintrust and the Shareholders’ Representative with respect to the contested portion of the Escrow Amount; or (iii) final determination of the parties rights with respect to the contested Escrow Amount in accordance with the Merger Agreement.  Any distributions to the Shareholders following a Final Determination shall be made as Escrow Disbursements in accordance with the procedures set forth in Section 2 above.  In the event that a Final Determination does not reference a date for disbursement of funds, the Escrow Agent shall disburse funds no later than ten (10) business days from the date of receipt of Final Determination by the Escrow Agent.

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4.Escrow Agent.

4.1Duties.  The duties of the Escrow Agent hereunder shall be entirely administrative and not discretionary.  The duties, responsibilities, and obligations of the Escrow Agent shall be limited to those expressly set forth herein and the Escrow Agent shall not have any responsibility as to the accuracy of, and shall incur no liability with respect to, any written notice, instruction, direction, request or other communication, statement, representation, warranty, agreement (including without limitation the Merger Agreement), or covenant made by any other party hereto (even if any reference thereto is made herein).  The Escrow Agent is not obligated to make any independent calculations under this Escrow Agreement.  The Escrow Agent shall be obligated to act only in accordance with written instructions received by it as provided in this Escrow Agreement and is authorized hereby to comply with any orders, judgments, or decrees of any court with or without jurisdiction or decision of any arbitrator and shall not be liable as a result of its compliance with the same.  The Escrow Agent will not be deemed to have knowledge of any event under this Escrow Agreement unless and until it receives written notice of such event.  None of the provisions of this Escrow Agreement shall require the Escrow Agent to use or advance its own funds in the performance of any of its duties hereunder, nor will the Escrow Agent be required to make any payments under this Escrow Agreement unless and until it will have received sufficient funds to make such payments.  The Escrow Agent may execute any of its powers and may perform any of its duties under this Escrow Agreement by or through attorneys, agents, or employees.  Notwithstanding anything herein to the contrary, the Escrow Agent is not responsible for nor assumed to have any knowledge of the contents of the Merger Agreement.

(a)                                 The Escrow Agent shall be fully protected in acting upon any written notice, instruction, direction, request or other communication, paper or document which the Escrow Agent believes to be genuine, and shall have no duty to inquire into or investigate the validity, accuracy or content of any thereof.

(b)                                 The Escrow Agent may engage or be interested in financial or other transactions with Wintrust or any party hereto or affiliate thereof, and may act on, or as depositary, trustee or agent for, any committee or body of holders of obligations of such party or affiliate, as freely as if it were not the Escrow Agent hereunder.

(c)                                  The Escrow Agent shall not be responsible or liable for any failure or delay in the performance of its obligations under this Escrow Agreement arising out of or caused, directly or indirectly, by circumstances beyond its reasonable control, including, without limitation: acts of God; earthquakes; fire; flood; wars; acts of terrorism; civil or military disturbances; sabotage; epidemic; riots; interruptions, loss or malfunctions of utilities, computer (hardware or software) or communications services; accidents; labor disputes; acts of civil or military authority or governmental action; it being understood that the Escrow Agent shall use commercially reasonable efforts which are consistent with accepted practices in the banking industry to resume performance as soon as reasonably practicable under the circumstances.

4.2Legal Opinions.  As to any legal questions or other uncertainties arising in connection with the administration of this Escrow Agreement, the Escrow Agent may rely absolutely upon the joint written instruction of Wintrust and the Shareholders’ Representative or

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the opinions or advice given to the Escrow Agent by its counsel (who may be an employee of the Escrow Agent and may also be counsel to one or more other parties to this Escrow Agreement) and shall be free of liability resulting from any delay due to waiting for, taking, suffering, or omitting to take any action in reliance upon such opinions or advice.

4.3Signatures.  The Escrow Agent may rely absolutely upon the genuineness and authorization of the signature and purported signature of any party upon any instruction, notice, release, receipt or other document delivered to it pursuant to this Escrow Agreement.

4.4Receipts and Releases.  In addition to the release requirements set forth above, the Escrow Agent may, as a condition to the disbursement of monies as provided herein, require from the payee or recipient a receipt therefor and, upon final payment, a release of the Escrow Agent from any liability arising out of its execution or performance of this Escrow Agreement, such release to be in a form reasonably satisfactory to the Escrow Agent.

4.5Refrain from Action.  The Escrow Agent shall be entitled to refrain from taking any action contemplated by this Escrow Agreement in the event it becomes aware of any dispute between the Shareholders’ Representative and Wintrust and will be fully protected and will not be liable in any way to the Shareholders’ Representative, Wintrust, or any other person or entity for failure or refusal to take such action.  In the event the Escrow Agent believes any ambiguity or uncertainty exists hereunder or in any notice, instruction, direction, request, or other communication, paper, or document received by the Escrow Agent hereunder, the Escrow Agent, may, in its sole discretion, refrain from taking any action, and shall be fully protected and shall not be liable in any way to Wintrust or the Shareholders’ Representative or any other person or entity for refraining from taking such action, unless the Escrow Agent receives written instructions signed by Wintrust and the Shareholders’ Representative that eliminates such ambiguity or uncertainty to the satisfaction of the Escrow Agent.

4.6Interpleader.  If any controversy arises between Wintrust and the Shareholders’ Representative or with any third person, the Escrow Agent shall not be required to determine the same or to take any action, but the Escrow Agent in its discretion may institute such interpleader or other proceedings in connection therewith as the Escrow Agent may deem proper, and in following either course, the Escrow Agent shall not be liable.

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5.Shareholders’ Representative.

5.1Expenses of Shareholders’ RepresentativeThe Shareholders’ Representative shall be entitled to reimbursement out of the Reserve Account for all reasonable out-of-pocket costs and expenses he may incur, if any, in performing the duties assigned to him by the Merger Agreement and the Escrow Agreement.  The Shareholders’ Representative may consult with, and obtain advice from, third-party advisors, including legal counsel and financial advisors, and the Reserve Account shall be used to reimburse the Shareholders’ Representative for all reasonable expenses incurred in consulting with such advisors, including all reasonable expenses incurred by the Shareholders’ Representative (including third-party advisor fees) in reviewing and responding to any Indemnity Claim Notice or Release Notice and in preparing any Indemnity Objection Notice or Release Objection Notice or in connection with any Final Determination.

5.2Change to Initial Shareholders’ Representative.  If the initial Shareholders’ Representative, Anthony V. Sisto, should die or become unable or unwilling to perform his duties, and unable or unwilling to appoint a successor, then Keith Kotche shall be appointed as the successor Shareholders’ Representative, to serve in the same capacity as the prior Shareholders’ Representative.  If the Shareholders’ Representative or the successor thereto named in this Escrow Agreement should die or become unable or unwilling to perform his duties, and unable or unwilling to appoint a successor, then Wintrust shall appoint any reasonable successor Shareholders’ Representative.  Any successor Shareholders’ Representative so appointed shall be vested with the same power and authority as the Shareholders’ Representative named in this Escrow Agreement.  The existing Shareholders’ Representative shall notify the Escrow Agent and Wintrust of any such change in the Shareholders’ Representative; provided, however, that if such notification is not possible, the successor Shareholders’ Representative shall notify the Escrow Agent and Wintrust of any such change.

6.Indemnification.

6.1Waiver and Indemnification.  Each of Wintrust and the Shareholders’ Representative agrees to and hereby does waive any suit, claim, demand, or cause of action of any kind that it may have or may assert against the Escrow Agent and the Escrow Agent shall not be liable for any action taken, suffered, or omitted to be taken hereunder arising out of or relating to the execution, administration, or performance by the Escrow Agent of this Escrow Agreement, unless such suit, claim, demand, or cause of action is based upon the intentional misconduct or gross negligence of the Escrow Agent, each as determined by a final, non-appealable judgment of a court of competent jurisdiction; provided, however, that notwithstanding anything in this Escrow Agreement to the contrary, the Escrow Agent shall not be liable in any event for special, punitive, indirect, incidental, or consequential losses or damages of any kind whatsoever (including but not limited to lost profits), even if the Escrow Agent has been advised of the likelihood of such loss or damage and regardless of the form of action.  Each of Wintrust and the Shareholders’ Representative further agrees to indemnify the Escrow Agent and its affiliates and their respective successors, directors, officers, employees, and consultants (collectively, the “Indemnitees”) and to defend and to hold the Indemnitees harmless against and from any and all claims, demands, costs, damages, losses, penalties, liabilities, and expenses, including reasonable attorneys’ fees, that may be asserted against them or to which they may be exposed or that the Indemnitees may incur for any action taken, suffered, or omitted to be taken, by reason of the

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execution, administration, or performance of this Escrow Agreement, except to the extent attributable to such Indemnitees’ intentional misconduct or gross negligence, each as determined by a final, non-appealable judgment of a court of competent jurisdiction.  This paragraph shall survive the resignation, removal or replacement of the Escrow Agent and the termination of this Escrow Agreement until extinguished by any applicable statute of limitations.  Wintrust and the Shareholders’ Representative shall each pay one half of the reasonable costs and expenses incurred by the Escrow Agent in enforcing this right of indemnification.

6.2Conditions to Indemnification.  In case any litigation is brought against the Escrow Agent or other Indemnitee in respect of which indemnification may be sought hereunder, the Escrow Agent shall give prompt notice of that litigation to Wintrust and the Shareholders’ Representative, and upon receipt of that notice Wintrust and the Shareholders’ Representative shall have the obligation to assume the defense of such litigation, provided that failure of the Escrow Agent to give such notice shall not relieve Wintrust or the Shareholders’ Representative from their obligations under Section 6 of this Agreement except to the extent that such failure materially prejudices the defense of such litigation but only to the extent of such prejudice.  At its own expense, the Escrow Agent may, but will not be expected to, employ separate counsel and participate in the defense of any litigation so assumed by Wintrust and the Shareholders’ Representative, provided that if the Escrow Agent is advised by its own counsel that there are material legal defenses available to it or any Indemnitee which are different from or additional to those available to any or all of the parties hereto, or a conflict of interest exists between any of the parties, the Escrow Agent or such Indemnitee will be entitled to obtain its own separate attorney whereby Wintrust and the Shareholders’ Representative shall each pay one half of the reasonable attorneys’ fees and expenses for such attorneys.  The parties hereto shall not be liable for any settlement without their respective consents.

6.3Indemnification and Customer Litigation Expenses of Shareholders’ Representative.  (a) On and prior to the Release Date, any funds held in the Reserve Account; and (b) on the Release Date, the amount of the then-remaining Escrow Amount minus any Pending Claim Amount, determined in accordance with Section 2 above; shall, subject to the limitations set forth in this section, be available to the Shareholders’ Representative to (i) indemnify and hold the Shareholders’ Representative harmless against and from any and all claims, demands, costs, damages, losses, penalties, liabilities, and expenses, including reasonable attorneys’ fees, arising out of, from, or in conjunction with the Shareholders’ Representative’s performance or inaction under this Escrow Agreement, the Merger Agreement or the Reserve Agreement, except to the extent attributable to the Shareholders’ Representative’s willful misconduct or gross negligence, each as determined by a final non-appealable judgment of a court of competent jurisdiction, and (ii) pursue, litigate, settle and take any other actions relating to the Customer Litigation.  Prior to the Release Date, the Shareholders’ Representative shall notify the Escrow Agent in writing, with a copy of such written notice to Wintrust, of the amount required, in the Shareholders’ Representative’s sole discretion but in an amount not to exceed $500,000, to cover any claims set forth in subsection (i) above and to fund the actions set forth in subsection (ii) above, to be paid into the Reserve Account pursuant to this Section 6.3, which amount shall be paid, to the extent funds are available, promptly after the Release Date.  Wintrust and Escrow Agent shall each be entitled to rely on any notice given or action taken by Shareholders’ Representative pursuant to this Agreement as being for the benefit of the

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Shareholders, and shall have no duty to inquire into the circumstances in which any such notice is given or action is taken.

7.Acknowledgment by the Escrow Agent.  By execution and delivery of this Escrow Agreement, the Escrow Agent acknowledges that the terms and provisions of this Escrow Agreement are acceptable and it agrees to carry out the express (and not implied) provisions of this Escrow Agreement on its part.

8.Resignation or Removal of Escrow Agent; Successor.

8.1Resignation and Removal.

(a)Notice.  The Escrow Agent may resign as such following not less than thirty (30) days’ prior written notice to Wintrust and the Shareholders’ Representative.  Similarly, the Escrow Agent may be removed and replaced following not less than thirty (30) days’ prior written notice to the Escrow Agent jointly by the Shareholders’ Representative and Wintrust.  In either event, the duties of the Escrow Agent shall terminate thirty (30) days after the date of such notice (or as of such earlier date as may be mutually agreeable), and the Escrow Agent shall then deliver the balance of the Escrow Amount then in its possession to a successor Escrow Agent as shall be jointly appointed by the other parties hereto as evidenced by a written notice filed with the Escrow Agent.

(b)Court Appointment.  If Wintrust and the Shareholders’ Representative are unable to agree upon a successor or shall have failed to appoint a successor prior to the expiration of thirty (30) days following the date of the notice of resignation or removal of the acting Escrow Agent, then the acting Escrow Agent may petition any court of competent jurisdiction for the appointment of a successor Escrow Agent or other appropriate relief, and any such resulting appointment shall be binding upon all of the parties hereto.

8.2Successors.  Every successor Escrow Agent appointed hereunder shall execute, acknowledge, and deliver to its predecessor, the Shareholders’ Representative and Wintrust a written acceptance of such appointment, and thereupon such successor, without any further act, shall become fully vested with all the duties, responsibilities, and obligations of its predecessor; but such predecessor shall, nevertheless, on the written request of its successor or Wintrust or the Shareholders’ Representative, execute and deliver an instrument or instruments transferring to such successor all the rights of such predecessor hereunder, and shall duly assign, transfer, and deliver all property and records, securities, and monies held by it pursuant to this Escrow Agreement to its successor.

8.3New Escrow Agent.  In the event of an appointment of a successor Escrow Agent, the predecessor shall cease to be Escrow Agent of any funds and records it may hold pursuant to this Escrow Agreement and the successor shall become the Escrow Agent hereunder.

8.4Release.  Upon written acknowledgment by any successor Escrow Agent of the receipt of the then remaining balance of the Escrow Amount and the property and records it has relating to this Escrow Agreement, the then acting Escrow Agent shall be fully released and relieved of all duties, responsibilities, and obligations under this Escrow Agreement that may arise and accrue thereafter.

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9.Fees of Escrow Agent.  Wintrust shall pay the Escrow Agent’s fees for administering the Escrow Account in accordance with the fee schedule attached hereto as Schedule I.  In the event the Escrow Agent is made a party to litigation with respect to the property held hereunder, or brings an action in interpleader, or the Escrow Agent agrees in writing to render any service not provided for in this Escrow Agreement and fee schedule, or there is any modification hereof agreed to in writing by the Escrow Agent, the Escrow Agent shall be entitled to reasonable compensation from Wintrust and the Shareholders’  Representative for such services and reimbursement for all fees, costs, liability, and expenses, including but not limited to reasonable attorneys’ fees, which compensation and reimbursement obligations shall be shared equally by Wintrust and Shareholders’ Representative.  The provisions of this Section 9 shall survive the termination of this Escrow Agreement and the resignation, removal or replacement of the Escrow Agent with respect to all fees earned and expenses incurred prior to such events.

10.Termination.  Except as otherwise set forth herein, this Escrow Agreement and the escrow created hereby shall terminate following the Escrow Agent’s final delivery of the balance of any remaining Escrow Amount to the Exchange Agent, the Shareholders’ Representative and/or Wintrust pursuant to the terms of this Escrow Agreement and the Merger Agreement.  Notwithstanding the foregoing, the provisions of Sections 4 and 8 of this Escrow Agreement shall survive the termination of this Escrow Agreement and the resignation, removal or replacement of the Escrow Agent.

11.Miscellaneous Provisions.

11.1Parties in Interest.  Except as otherwise expressly set forth herein, this Escrow Agreement is not intended, nor shall it be construed, to confer any enforceable rights on any person not a party hereto.  All of the terms and provisions of this Escrow Agreement will be binding upon and inure to the benefit of and be enforceable by the respective successors and assigns of the parties hereto.

11.2Entire Agreement.  This Escrow Agreement, together with the applicable provisions of the Merger Agreement and Reserve Agreement as referenced herein, constitutes the final and entire agreement among the parties hereto with respect to the subject matter hereof and supersedes all prior arrangements or understandings.  Notwithstanding the foregoing, the Escrow Agent shall not be subject to, nor be required to comply with, or determine if any person or entity has complied with, the Merger Agreement, Reserve Agreement or any other agreement between or among the parties hereto other than this Escrow Agreement, even though reference thereto may be made in this Escrow Agreement.

11.3Notices.   All notices, requests, demands, or other communications that are required or may be given pursuant to the terms of this Escrow Agreement shall be in writing and shall be deemed to have been duly given (a) on the date of delivery if personally delivered by hand, (b) one day after such notice is sent by an internationally recognized overnight express courier, specifying next day delivery, with written verification of receipt, or (c) if delivered to the applicable email address set forth below, upon confirmed transmission by sender to such email address.  All communications shall be sent to the address as set forth below or at such other address as such party may designate from time to time by means of five (5) days advance written notice to the other parties hereto given in the manner provided in this Section 11.3.

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If to the Escrow Agent:

The Chicago Trust Company, N.A., a national association

1000 Hillgrove Avenue

Western Springs, Illinois 60558

Attention:                                         Robert J. Mayo

Chief Executive Officer

Email:                                                            BMayo@wintrustwealth.com

If to Wintrust:

Wintrust Financial Corporation

9700 W. Higgins Road, Suite 800

Rosemont, Illinois 60018

Attention:                                         Kathleen M. Boege

Executive Vice President, General Counsel and Corporate Secretary

Email:                                                            kboege@wintrust.com

With a copy to:

Schiff Hardin LLP

233 S. Wacker Drive, Suite 7100

Chicago, Illinois 60606

Attention:                                         Matthew G. Galo

Email:                                                            mgalo@schiffhardin.com

and

If to the Shareholders’ Representative:

Anthony V. Sisto

Email:

With a copy to:

Barack Ferrazzano Kirschbaum & Nagelberg LLP

200 West Madison Street, Suite 3900

Chicago, IL 60606

Attention:                                         Dennis R. Wendte

Email:                                                            dennis.wendte@bfkn.com

11.4Changes.  The terms of this Escrow Agreement may not be modified or amended, or any provisions waived, temporarily or permanently, except pursuant to the written

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agreement of Wintrust, the Shareholders’ Representative and the Escrow Agent.  Such amendment, modification or waiver shall be effective only in the specific instance and for the specific purpose given.

11.5Severability.  In the event of any conflict between the terms and provisions of this Escrow Agreement and those of the Merger Agreement or Reserve Agreement, the terms and conditions of this Escrow Agreement will apply. If any term or provision of this Escrow Agreement or the application thereof as to any person or circumstance is held invalid or unenforceable to any extent, the remaining terms and provisions of this Escrow Agreement or the application of such term or provision to persons or circumstances other than those as to which it is held invalid or unenforceable shall not be affected thereby and each term and provision of this Escrow Agreement shall be valid and enforceable to the fullest extent permitted by law.

11.6Counterparts.  This Escrow Agreement may be executed in two or more counterparts, each of which shall be deemed an original and shall bind the signatory, but all of which together shall constitute one and the same instrument.  The execution and delivery (including via electronic mail) of a signature page in the form attached to this Escrow Agreement by any party hereto who has been furnished the final form of this Escrow Agreement shall constitute the execution and delivery of this Escrow Agreement by such party.  Signature pages in portable document format (PDF) delivered via email shall be treated as if they were originals.

11.7Headings.  The headings of the sections of this Escrow Agreement have been inserted for convenience of reference only and shall not be deemed to be a part of this Escrow Agreement.

11.8Assignment.  This Escrow Agreement may not be assigned, or otherwise transferred, in whole or in part, by any party without the prior written consent of the other parties, which the other parties will not unreasonably withhold, condition or delay; except that consent is not required for a merger, conversion, consolidation with or assignment to an affiliate of Wintrust or for appointment of a successor Shareholders’ Representative. Any attempted assignment in violation of the foregoing will be void.

11.9Governing Law.  This Escrow Agreement shall be construed and controlled by the laws of the State of Illinois without regard to the principles of conflicts of laws.

11.10Binding Effect.  This Escrow Agreement shall inure to the benefit of and be binding upon the parties hereto and their respective heirs, affiliates, successors, and assigns.

[Signature Page Follows]

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IN WITNESS WHEREOF, the parties have executed this Escrow Agreement as of the date first above written.

WINTRUST FINANCIAL CORPORATION

By:

Name:

David A. Dykstra

Title:

Senior Executive Vice President and Chief Operating Officer

SHAREHOLDERS’ REPRESENTATIVE:

Anthony V. Sisto

ESCROW AGENT:

THE CHICAGO TRUST COMPANY, N.A.

By:

Name:

Title:

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EXHIBIT A

MERGER AGREEMENT

(See attached.)

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SCHEDULE I

ESCROW AGENT FEES

One-time Account Administration Fee                          $[3,500]

This one-time fee will cover the Escrow Agent’s review of the Escrow Agreement and standard escrow services including, but not limited to, account set-up, safekeeping of assets, investment of funds, collection of income and other receipts, preparation of statements comprising account activity and asset listing, and distribution of assets in accordance with the specific terms of the Escrow Agreement.

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Exhibit D-1

Proforma Policy for First Street Property

See Attached.

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Form No. 1402.06

Shareholders:

Policy Page 1

/s/ Debra J. AlderALTA Owner’s Policy (6-17-06)

Policy Number:            

Debra Adler

1100302P050600

OWNER’S POLICY OF TITLE INSURANCE

ISSUED BY

First American Title Insurance Company

Any notice of claim and any other notice or statement in writing required to be given to the Company under this policy must be given to the Company at the address shown in Section 18 of the Conditions.

COVERED RISKS

SUBJECT TO THE EXCLUSIONS FROM COVERAGE, THE EXCEPTIONS FROM COVERAGE CONTAINED IN SCHEDULE B AND THE CONDITIONS, FIRST AMERICAN TITLE INSURANCE COMPANY, a Nebraska corporation (the “Company”) insures, as of Date of Policy and, to the extent stated in Covered Risks 9 and 10, after Date of Policy, against loss or damage, not exceeding the Amount of Insurance, sustained or incurred by the Insured by reason of:

1.              Title being vested other than as stated in Schedule A.

2.              Any defect in or lien or encumbrance on the Title. This Covered Risk includes but is not limited to insurance against loss from

(a)         A defect in the Title caused by

(i)             forgery, fraud, undue influence, duress, incompetency, incapacity, or impersonation;

(ii)          failure of any person or Entity to have authorized a transfer or conveyance;

(iii)       a document affecting Title not properly created, executed, witnessed, sealed, acknowledged, notarized, or delivered;

(iv)      failure to perform those acts necessary to create a document by electronic means authorized by law;

(v)         a document executed under a falsified, expired, or otherwise invalid power of attorney;

(vi)      a document not properly filed, recorded, or indexed in the Public Records including failure to perform those acts by electronic means authorized by law; or

(vii)   a defective judicial or administrative proceeding.

(b)         The lien of real estate taxes or assessments imposed on the Title by a governmental authority due or payable, but unpaid.

(c)          Any encroachment, encumbrance, violation, variation, or adverse circumstance affecting the Title that would be disclosed by an accurate and complete land survey of the Land. The term “encroachment” includes encroachments of existing improvements located on the Land onto adjoining land, and encroachments onto the Land of existing improvements located on adjoining land.

3.              Unmarketable Title.

4.              No right of access to and from the Land.

5.              The violation or enforcement of any law, ordinance, permit, or governmental regulation (including those relating to building and zoning) restricting, regulating, prohibiting, or relating to

(a)         the occupancy, use, or enjoyment of the Land;

(b)         the character, dimensions, or location of any improvement erected on the Land;

(c)          the subdivision of land; or

(d)         environmental protection

if a notice, describing any part of the Land, is recorded in the Public Records setting forth the violation or intention to enforce, but only to the extent of the violation or enforcement referred to in that notice.

6.              An enforcement action based on the exercise of a governmental police power not covered by Covered Risk 5 if a notice of the enforcement action, describing any part of the Land, is recorded in the Public Records, but only to the extent of the enforcement referred to in that notice.

7.              The exercise of the rights of eminent domain if a notice of the exercise, describing any part of the Land, is recorded in the Public Records.

8.              Any taking by a governmental body that has occurred and is binding on the rights of a purchaser for value without Knowledge.

9.              Title being vested other than as stated in Schedule A or being defective

(a)         as a result of the avoidance in whole or in part, or from a court order providing an alternative remedy, of a transfer of all or any part of the title to or any interest in the Land occurring prior to the transaction vesting Title as shown in Schedule A because that prior transfer constituted a fraudulent or preferential transfer under federal bankruptcy, state insolvency, or similar creditors’ rights laws; or

(b)         because the instrument of transfer vesting Title as shown in Schedule A constitutes a preferential transfer under federal bankruptcy, state insolvency, or similar creditors’ rights laws by reason of the failure of its recording in the Public Records

(i)          to be timely, or

(ii)       to impart notice of its existence to a purchaser for value or to a judgment or lien creditor.

10.       Any defect in or lien or encumbrance on the Title or other matter included in Covered Risks 1 through 9 that has been created or attached or has been filed or recorded in the Public Records subsequent to Date of Policy and prior to the recording of the deed or other instrument of transfer in the Public Records that vests Title as shown in Schedule A.

The Company will also pay the costs, attorneys’ fees, and expenses incurred in defense of any matter insured against by this policy, but only to the extent provided in the Conditions.

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Form No. 1402.06

Policy Page 2

/s/ J. Edward ClairALTA Owner’s Policy (6-17-06)

Policy Number:

EXCLUSIONS FROM COVERAGE

The following matters are expressly excluded from the coverage of this policy, and the Company will not pay loss or damage, costs, attorneys’ fees, or expenses that arise by reason of:

1.              (a)         Any law, ordinance, permit, or governmental regulation (including those relating to building and zoning) restricting, regulating, prohibiting, or relating to

(i)             the occupancy, use, or enjoyment of the Land;

(ii)          the character, dimensions, or location of any improvement erected on the Land;

(iii)       the subdivision of land; or

(iv)      environmental protection;

or the effect of any violation of these laws, ordinances, or governmental regulations. This Exclusion 1(a) does not modify or limit the coverage provided under Covered Risk 5.

(b)         Any governmental police power. This Exclusion 1(b) does not modify or limit the coverage provided under Covered Risk 6.

2.              Rights of eminent domain. This Exclusion does not modify or limit the coverage provided under Covered Risk 7 or 8.

3.              Defects, liens, encumbrances, adverse claims, or other matters

(a)         created, suffered, assumed, or agreed to by the Insured Claimant;

(b)         not Known to the Company, not recorded in the Public Records at Date of Policy, but Known to the Insured Claimant and not disclosed in writing to the Company by the Insured Claimant prior to the date the Insured Claimant became an Insured under this policy;

(c)          resulting in no loss or damage to the Insured Claimant;

(d)         attaching or created subsequent to Date of Policy (however, this does not modify or limit the coverage provided under Covered Risks 9 and 10); or

(e)          resulting in loss or damage that would not have been sustained if the Insured Claimant had paid value for the Title.

4.              Any claim, by reason of the operation of federal bankruptcy, state insolvency, or similar creditors’ rights laws, that the transaction vesting the Title as shown in Schedule A, is

(a)         a fraudulent conveyance or fraudulent transfer; or

(b)         a preferential transfer for any reason not stated in Covered Risk 9 of this policy.

5.              Any lien on the Title for real estate taxes or assessments imposed by governmental authority and created or attaching between Date of Policy and the date of recording of the deed or other instrument of transfer in the Public Records that vests Title as shown in Schedule A.

CONDITIONS

1.DEFINITION OF TERMS

The following terms when used in this policy mean:

(a)         “Amount of Insurance”: The amount stated in Schedule A, as may be increased or decreased by endorsement to this policy, increased by Section 8(b), or decreased by Sections 10 and 11 of these Conditions.

(b)         “Date of Policy”: The date designated as “Date of Policy” in Schedule A.

(c)          “Entity”: A corporation, partnership, trust, limited liability company, or other similar legal entity.

(d)         “Insured”: The Insured named in Schedule A.

(i)             The term “Insured” also includes

(A)       successors to the Title of the Insured by operation of law as distinguished from purchase, including heirs, devisees, survivors, personal representatives, or next of kin;

(B)       successors to an Insured by dissolution, merger, consolidation, distribution, or reorganization;

(C)       successors to an Insured by its conversion to another kind of Entity;

(D)       a grantee of an Insured under a deed delivered without payment of actual valuable consideration conveying the Title

(1)         if the stock, shares, memberships, or other equity interests of the grantee are wholly-owned by the named Insured,

(2)         if the grantee wholly owns the named Insured,

(3)         if the grantee is wholly-owned by an affiliated Entity of the named Insured, provided the affiliated Entity and the named Insured are both wholly-owned by the same person or Entity, or

(4)         if the grantee is a trustee or beneficiary of a trust created by a written instrument established by the Insured named in Schedule A for estate planning purposes.

(ii)          With regard to (A), (B), (C), and (D) reserving, however, all rights and defenses as to any successor that the Company would have had against any predecessor Insured.

(e)          “Insured Claimant”: An Insured claiming loss or damage.

(f)           “Knowledge” or “Known”: Actual knowledge, not constructive knowledge or notice that may be imputed to an Insured by reason of the Public Records or any other records that impart constructive notice of matters affecting the Title.

(g)          “Land”: The land described in Schedule A, and affixed improvements that by law constitute real property. The term “Land” does not include any property beyond the lines of the area described in Schedule A, nor any right, title, interest, estate, or easement in abutting streets, roads, avenues, alleys, lanes, ways, or waterways, but this does not modify or limit the extent that a right of access to and from the Land is insured by this policy.

(h)         “Mortgage”: Mortgage, deed of trust, trust deed, or other security instrument, including one evidenced by electronic means authorized by law.

(i)             “Public Records”: Records established under state statutes at Date of Policy for the purpose of imparting constructive notice of matters relating to real property to purchasers for value and without Knowledge. With respect to Covered Risk 5(d), “Public Records” shall also include environmental protection liens filed in the records of the clerk of the United States District Court for the district where the Land is located.

(j)            “Title”: The estate or interest described in Schedule A.

(k)         “Unmarketable Title”: Title affected by an alleged or apparent matter that would permit a prospective purchaser or lessee of the Title or lender on the Title to be released from the obligation to purchase, lease, or lend if there is a contractual condition requiring the delivery of marketable title.

2.CONTINUATION OF INSURANCE

The coverage of this policy shall continue in force as of Date of Policy in favor of an Insured, but only so long as the Insured retains an estate or interest in the Land, or holds an obligation secured by a purchase money Mortgage given by a purchaser from the Insured, or only so long as the Insured shall have liability by reason of warranties in any transfer or conveyance of the Title. This policy shall not continue in force in favor of any purchaser from the Insured of either (i) an estate or interest in the Land, or (ii) an obligation secured by a purchase money Mortgage given to the Insured.

3.NOTICE OF CLAIM TO BE GIVEN BY INSURED CLAIMANT

The Insured shall notify the Company promptly in writing (i) in case of any litigation as set forth in Section 5(a) of these Conditions, (ii) in case Knowledge shall come to an Insured hereunder of any claim of title or interest that is adverse to the Title, as insured, and that might cause loss or damage for which the Company may be liable by virtue of this policy, or (iii) if the Title, as insured, is rejected as Unmarketable Title. If the Company is prejudiced by the failure of the Insured Claimant to provide prompt notice, the Company’s liability to the Insured Claimant under the policy shall be reduced to the extent of the prejudice.

4.PROOF OF LOSS

In the event the Company is unable to determine the amount of loss or damage, the Company may, at its option, require as a condition of payment that the Insured Claimant furnish a signed proof of loss. The proof of loss must describe the defect, lien, encumbrance, or other matter insured against by this policy that constitutes the basis of loss or damage and shall state, to the extent possible, the basis of calculating the amount of the loss or damage.

5.DEFENSE AND PROSECUTION OF ACTIONS

(a)         Upon written request by the Insured, and subject to the options contained in Section 7 of these Conditions, the Company, at its own cost and without unreasonable delay, shall provide for the defense of an Insured in litigation in which any third party asserts a claim covered by this policy adverse to the Insured. This obligation is limited to only those stated causes of action alleging matters insured against by this policy. The Company shall have the right to select counsel of its choice (subject to the right of the Insured to object for reasonable cause) to represent the Insured as to those stated causes of action. It shall not be liable for and will not pay the fees of any other counsel. The Company will not pay any fees, costs, or expenses incurred by the Insured in the defense of those causes of action that allege matters not insured against by this policy.

(b)         The Company shall have the right, in addition to the options contained in

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Form No. 1402.06

Policy Page 3

J. Edward Clair

ALTA Owner’s Policy (6-17-06)

Policy Number:

Section 7 of these Conditions, at its own cost, to institute and prosecute any action or proceeding or to do any other act that in its opinion may be necessary or desirable to establish the Title, as insured, or to prevent or reduce loss or damage to the Insured. The Company may take any appropriate action under the terms of this policy, whether or not it shall be liable to the Insured. The exercise of these rights shall not be an admission of liability or waiver of any provision of this policy. If the Company exercises its rights under this subsection, it must do so diligently.

(c)          Whenever the Company brings an action or asserts a defense as required or permitted by this policy, the Company may pursue the litigation to a final determination by a court of competent jurisdiction, and it expressly reserves the right, in its sole discretion, to appeal any adverse judgment or order.

6.DUTY OF INSURED CLAIMANT TO COOPERATE

(a)         In all cases where this policy permits or requires the Company to prosecute or provide for the defense of any action or proceeding and any appeals, the Insured shall secure to the Company the right to so prosecute or provide defense in the action or proceeding, including the right to use, at its option, the name of the Insured for this purpose. Whenever requested by the Company, the Insured, at the Company’s expense, shall give the Company all reasonable aid (i) in securing evidence, obtaining witnesses, prosecuting or defending the action or proceeding, or effecting settlement, and (ii) in any other lawful act that in the opinion of the Company may be necessary or desirable to establish the Title or any other matter as insured. If the Company is prejudiced by the failure of the Insured to furnish the required cooperation, the Company’s obligations to the Insured under the policy shall terminate, including any liability or obligation to defend, prosecute, or continue any litigation, with regard to the matter or matters requiring such cooperation.

(b)         The Company may reasonably require the Insured Claimant to submit to examination under oath by any authorized representative of the Company and to produce for examination, inspection, and copying, at such reasonable times and places as may be designated by the authorized representative of the Company, all records, in whatever medium maintained, including books, ledgers, checks, memoranda, correspondence, reports, e-mails, disks, tapes, and videos whether bearing a date before or after Date of Policy, that reasonably pertain to the loss or damage. Further, if requested by any authorized representative of the Company, the Insured Claimant shall grant its permission, in writing, for any authorized representative of the Company to examine, inspect, and copy all of these records in the custody or control of a third party that reasonably pertain to the loss or damage. All information designated as confidential by the Insured Claimant provided to the Company pursuant to this Section shall not be disclosed to others unless, in the reasonable judgment of the Company, it is necessary in the administration of the claim. Failure of the Insured Claimant to submit for examination under oath, produce any reasonably requested information, or grant permission to secure reasonably necessary information from third parties as required in this subsection, unless prohibited by law or governmental regulation, shall terminate any liability of the Company under this policy as to that claim.

7.OPTIONS TO PAY OR OTHERWISE SETTLE CLAIMS; TERMINATION OF LIABILITY

In case of a claim under this policy, the Company shall have the following additional options:

(a)         To Pay or Tender Payment of the Amount of Insurance.

To pay or tender payment of the Amount of Insurance under this policy together with any costs, attorneys’ fees, and expenses incurred by the Insured Claimant that were authorized by the Company up to the time of payment or tender of payment and that the Company is obligated to pay. Upon the exercise by the Company of this option, all liability and obligations of the Company to the Insured under this policy, other than to make the payment required in this subsection, shall terminate, including any liability or obligation to defend, prosecute, or continue any litigation.

(b)         To Pay or Otherwise Settle With Parties Other Than the Insured or With the Insured Claimant.

(i)             To pay or otherwise settle with other parties for or in the name of an Insured Claimant any claim insured against under this policy. In addition, the Company will pay any costs, attorneys’ fees, and expenses incurred by the Insured Claimant that were authorized by the Company up to the time of payment and that the Company is obligated to pay; or

(ii)          To pay or otherwise settle with the Insured Claimant the loss or damage provided for under this policy, together with any costs, attorneys’ fees, and expenses incurred by the Insured Claimant that were authorized by the Company up to the time of payment and that the Company is obligated to pay.

Upon the exercise by the Company of either of the options provided for in subsections (b)(i) or (ii), the Company’s obligations to the Insured under this policy for the claimed loss or damage, other than the payments required to be made, shall terminate, including any liability or obligation to defend, prosecute, or continue any litigation.

8.DETERMINATION AND EXTENT OF LIABILITY

This policy is a contract of indemnity against actual monetary loss or damage sustained or incurred by the Insured Claimant who has suffered loss or damage by reason of matters insured against by this policy.

(a)         The extent of liability of the Company for loss or damage under this policy shall not exceed the lesser of

(i)          the Amount of Insurance; or

(ii)       the difference between the value of the Title as insured and the value of the Title subject to the risk insured against by this policy.

(b)         If the Company pursues its rights under Section 5 of these Conditions and is unsuccessful in establishing the Title, as insured,

(i)          the Amount of Insurance shall be increased by 10%, and

(ii)       the Insured Claimant shall have the right to have the loss or damage determined either as of the date the claim was made by the Insured Claimant or as of the date it is settled and paid.

(c)     In addition to the extent of liability under (a) and (b), the Company will also pay those costs, attorneys’ fees, and expenses incurred in accordance with Sections 5 and 7 of these Conditions.

9.LIMITATION OF LIABILITY

(a)         If the Company establishes the Title, or removes the alleged defect, lien, or encumbrance, or cures the lack of a right of access to or from the Land, or cures the claim of Unmarketable Title, all as insured, in a reasonably diligent manner by any method, including litigation and the completion of any appeals, it shall have fully performed its obligations with respect to that matter and shall not be liable for any loss or damage caused to the Insured.

(b)         In the event of any litigation, including litigation by the Company or with the Company’s consent, the Company shall have no liability for loss or damage until there has been a final determination by a court of competent jurisdiction, and disposition of all appeals, adverse to the Title, as insured.

(c)          The Company shall not be liable for loss or damage to the Insured for liability voluntarily assumed by the Insured in settling any claim or suit without the prior written consent of the Company.

10.REDUCTION OF INSURANCE; REDUCTION OR TERMINATION OF LIABILITY

All payments under this policy, except payments made for costs, attorneys’ fees, and expenses, shall reduce the Amount of Insurance by the amount of the payment.

11.LIABILITY NONCUMULATIVE

The Amount of Insurance shall be reduced by any amount the Company pays under any policy insuring a Mortgage to which exception is taken in Schedule B or to which the Insured has agreed, assumed, or taken subject, or which is executed by an Insured after Date of Policy and which is a charge or lien on the Title, and the amount so paid shall be deemed a payment to the Insured under this policy.

12.PAYMENT OF LOSS

When liability and the extent of loss or damage have been definitely fixed in accordance with these Conditions, the payment shall be made within 30 days.

13.RIGHTS OF RECOVERY UPON PAYMENT OR SETTLEMENT

(a)         Whenever the Company shall have settled and paid a claim under this policy, it shall be subrogated and entitled to the rights of the Insured Claimant in the Title and all other rights and remedies in respect to the claim that the Insured Claimant has against any person or property, to the extent of the amount of any loss, costs, attorneys’ fees, and expenses paid by the Company. If requested by the Company, the Insured Claimant shall execute documents to evidence the transfer to the Company of these rights and remedies. The Insured Claimant shall permit the Company to sue, compromise, or settle in the name of the Insured Claimant and to use the name of the Insured Claimant in any transaction or litigation involving these rights and remedies.

If a payment on account of a claim does not fully cover the loss of the Insured Claimant, the Company shall defer the exercise of its right to recover until after the Insured Claimant shall have recovered its loss.

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Table of Contents

Form No. 1402.06

Policy Page 4

/s/ Michael MurphyALTA Owner’s Policy (6-17-06)

Policy Number:

(b)         The Company’s right of subrogation includes the rights of the Insured to indemnities, guaranties, other policies of insurance, or bonds, notwithstanding any terms or conditions contained in those instruments that address subrogation rights.

14.ARBITRATION

Either the Company or the Insured may demand that the claim or controversy shall be submitted to arbitration pursuant to the Title Insurance Arbitration Rules of the American Land Title Association (“Rules”). Except as provided in the Rules, there shall be no joinder or consolidation with claims or controversies of other persons. Arbitrable matters may include, but are not limited to, any controversy or claim between the Company and the Insured arising out of or relating to this policy, any service in connection with its issuance or the breach of a policy provision, or to any other controversy or claim arising out of the transaction giving rise to this policy. All arbitrable matters when the Amount of Insurance is $2,000,000 or less shall be arbitrated at the option of either the Company or the Insured. All arbitrable matters when the Amount of Insurance is in excess of $2,000,000 shall be arbitrated only when agreed to by both the Company and the Insured. Arbitration pursuant to this policy and under the Rules shall be binding upon the parties. Judgment upon the award rendered by the Arbitrator(s) may be entered in any court of competent jurisdiction.

15.LIABILITY LIMITED TO THIS POLICY; POLICY ENTIRE CONTRACT

(a)         This policy together with all endorsements, if any, attached to it by the Company is the entire policy and contract between the Insured and the Company. In interpreting any provision of this policy, this policy shall be construed as a whole.

(b)         Any claim of loss or damage that arises out of the status of the Title or by any action asserting such claim shall be restricted to this policy.

(c)          Any amendment of or endorsement to this policy must be in writing and authenticated by an authorized person, or expressly incorporated by Schedule A of this policy.

(d)         Each endorsement to this policy issued at any time is made a part of this policy and is subject to all of its terms and provisions. Except as the endorsement expressly states, it does not (i) modify any of the terms and provisions of the policy, (ii) modify any prior endorsement, (iii) extend the Date of Policy, or (iv) increase the Amount of Insurance.

16.SEVERABILITY

In the event any provision of this policy, in whole or in part, is held invalid or unenforceable under applicable law, the policy shall be deemed not to include that provision or such part held to be invalid, but all other provisions shall remain in full force and effect.

17.CHOICE OF LAW; FORUM

(a)         Choice of Law: The Insured acknowledges the Company has underwritten the risks covered by this policy and determined the premium charged therefore in reliance upon the law affecting interests in real property and applicable to the interpretation, rights, remedies, or enforcement of policies of title insurance of the jurisdiction where the Land is located. Therefore, the court or an arbitrator shall apply the law of the jurisdiction where the Land is located to determine the validity of claims against the Title that are adverse to the Insured and to interpret and enforce the terms of this policy. In neither case shall the court or arbitrator apply its conflicts of law principles to determine the applicable law.

(b)         Choice of Forum: Any litigation or other proceeding brought by the Insured against the Company must be filed only in a state or federal court within the United States of America or its territories having appropriate jurisdiction.

18.NOTICES, WHERE SENT

Any notice of claim and any other notice or statement in writing required to be given to the Company under this policy must be given to the Company at 1 First American Way, Santa Ana, CA 92707, Attn: Claims Department.

POLICY OF TITLE INSURANCE

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Table of Contents

Form No. 1402.06

Policy Page 5

Michael Murphy

ALTA Owner’s Policy (6-17-06)

Policy Number:

SCHEDULE A

First American Title Insurance Company

Name and Address of the issuing Title Insurance Company:

First American Title Insurance Company

30 North LaSalle Street, Suite 2700

Chicago, IL 60602

File No.: NCS-960541-CHI2                                                                                                                                                                                                                                                                                                                                                               Policy No.:

Amount of Insurance: $1,778,675.00

Date of Policy:  [Date of recording at time of recording]

1.                        Name of Insured:

TBD

2.                        The estate or interest in the Land that is insured by this policy is:

Fee Simple

3.                        Title is vested in:

TBD

4.                        The Land referred to in this policy is described as follows:

Real property in the City of St. Charles, County of Kane, State of Illinois, described as follows:

PARCEL 1:

THAT PART OF LOT 16 IN BROWNSTONE, A SUBDIVISION IN THE CITY OF ST. CHARLES, WEST SIDE OF THE FOX RIVER, BEING A SUBDIVISION IN THE NORTHWEST QUARTER OF SECTION 34, TOWNSHIP 40 NORTH, RANGE 8 EAST OF THE THIRD PRINCIPAL MERIDIAN BOUNDED AND DESCRIBED AS FOLLOWS: COMMENCING AT THE SOUTHWESTERLY CORNER OF SAID LOT 16; THENCE NORTH 78 DEGREES 44 MINUTES 33 SECONDS EAST BEING AN ASSUMED BEARING ON THE SOUTHERLY LINE OF SAID LOT 16, THE SAME AS THE NORTHERLY LINE OF COBBLESTONE DRIVE, 2.0 FEET; THENCE NORTH 11 DEGREES 15 MINUTES, 27 SECONDS WEST, 17.66 FEET; THENCE NORTH 78 DEGREES, 44 MINUTES, 33 SECONDS EAST, 11.42 FEET TO THE INTERIOR WALL OF FIRST FLOOR COMMERCIAL UNIT “D” FOR THE POINT OF BEGINNING; THENCE NORTH 11 DEGREES, 15 MINUTES, 27 SECONDS WEST ALONG SAID INTERIOR WALLS 40.07 FEET; THENCE NORTH 78 DEGREES, 44 MINUTES, 33 SECONDS EAST, 27.28 FEET; THENCE NORTH 11 DEGREES, 15 MINUTES, 27 SECONDS WEST, 11.33 FEET; THENCE SOUTH 78 DEGREES 44 MINUTES, 33 SECONDS WEST, 27.28 FEET; THENCE NORTH 11 DEGREES, 15 MINUTES, 27 SECONDS WEST, 51.81 FEET; THENCE NORTH 78 DEGREES, 44 MINUTES, 33 SECONDS EAST, 57.64 FEET; THENCE SOUTH 11 DEGREES, 15 MINUTES, 27 SECONDS EAST, 12.66 FEET; THENCE SOUTH 78 DEGREES, 44 MINUTES, 33 SECONDS WEST 3.33 FEET; THENCE SOUTH 11 DEGREES, 15 MINUTES, 27 SECONDS EAST 18.83 FEET; THENCE NORTH 78 DEGREES, 44 MINUTES, 33 SECONDS EAST, 3.33 FEET; THENCE SOUTH 11 DEGREES, 15 MINUTES, 27 SECONDS EAST 15.32 FEET; THENCE SOUTH 78 DEGREES, 44 MINUTES, 33 SECONDS WEST, 9.91 FEET; THENCE NORTH 11 DEGREES, 15 MINUTES, 27 SECONDS WEST, 2.0 FEET; THENCE SOUTH 78 DEGREES, 44 MINUTES, 33 SECONDS WEST, 6.30 FEET; THENCE SOUTH 11 DEGREES, 15 MINUTES, 27 SECONDS EAST, 12.54 FEET; THENCE SOUTH 78 DEGREES 44 MINUTES, 33 SECONDS WEST, 3.91 FEET; THENCE SOUTH 11 DEGREES, 15 MINUTES, 27 SECONDS EAST, 5.58 FEET; THENCE NORTH 78 DEGREES, 44 MINUTES, 33 SECONDS EAST, 4.58 FEET; THENCE NORTH 11 DEGREES, 15 MINUTES, 27 SECONDS WEST,

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Table of Contents

Form No. 1402.06

Policy Page 6

/s/ James SaerALTA Owner’s Policy (6-17-06)

Policy Number:

1.29 FEET; THENCE NORTH 78 DEGREES, 44 MINUTES, 33 SECONDS EAST, 8.33 FEET, THENCE SOUTH 11 DEGREES, 15 MINUTES, 27 SECONDS EAST, 6.50 FEET; THENCE NORTH 78 DEGREES, 44 MINUTES, 33 SECONDS EAST, 7.41 FEET; THENCE SOUTH 11 DEGREES, 15 MINUTES, 27 SECONDS EAST, 15.33 FEET; THENCE SOUTH 78 DEGREES, 44 MINUTES, 33 SECONDS WEST, 3.33 FEET; THENCE SOUTH 11 DEGREES, 15 MINUTES, 27 SECONDS EAST, 19.75 FEET; THENCE SOUTH 33 DEGREES, 44 MINUTES, 33 SECONDS WEST, 11.89 FEET; THENCE SOUTH 78 DEGREES, 44 MINUTES, 33 SECONDS WEST, 6.25 FEET; THENCE SOUTH 11 DEGREES, 15 MINUTES, 27 SECONDS EAST, 3.33 FEET; THENCE SOUTH 78 DEGREES, 44 MINUTES, 33 SECONDS WEST, 24.99 FEET; THENCE NORTH 11 DEGREES, 15 MINUTES, 27 SECONDS, WEST, 3.33 FEET; THENCE SOUTH 78 DEGREES, 44 MINUTES, 33 SECONDS WEST, 6.25 FEET; THENCE NORTH 56 DEGREES, 15 MINUTES, 27 SECONDS WEST, 11.89 FEET, TO THE POINT OF BEGINNING, ALL IN KANE COUNTY, ILLINOIS, TAKEN AS A SINGLE TRACT OF LAND, EXCEPT THAT PART LYING ABOVE A HORIZONTAL PLANE HAVING A LOWER ELEVATION OF 702.69 FEET MEASURED ON SAID COMMERCIAL UNIT “D” CEILING AND LYING BELOW A HORIZONTAL PLANE HAVING AN UPPER ELEVATION OF 691.02 FEET MEASURED ON SAID COMMERCIAL UNIT “D” FLOOR; SAID ELEVATIONS REFERENCED TO N.G.V.D. 29 DATUM FOR FEMA BENCH MARK 266-4 IN KANE COUNTY, ILLINOIS.

PARCEL 2:

EASEMENTS FOR THE BENEFIT OF PARCEL 1 PURSUANT TO THAT CERTAIN DECLARATION OF CONDOMINIUM OWNERSHIP THE RESIDENCES AT MILESTONE ROW ST. CHARLES AND PROVISIONS RELATING TO CERTAIN COMMERCIAL PROPERTY RECORDED FEBRUARY 28, 2007 AS DOCUMENT NO. 2007K022542; AS AMENDED BY FIRST SPECIAL AMENDMENT TO DECLARATION OF CONDOMINIUM OWNERSHIP RECORDED JANUARY 25, 2008 AS DOCUMENT 2008K006831; AS FURTHER AMENDED BY SECOND SPECIAL AMENDMENT TO DECLARATION OF CONDOMINIUM OWNERSHIP THE RESIDENCES AT MILESTONE ROW ST. CHARLES AND PROVISIONS RELATING TO CERTAIN COMMERCIAL PROPERTY RECORDED MARCH 28, 2014 AS DOCUMENT 2014K014675.

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Table of Contents

Form No. 1402.06

Policy Page 7

James Saer

ALTA Owner’s Policy (6-17-06)

Policy Number:

SCHEDULE B

File No.: NCS-960541-CHI2

Policy No.:

EXCEPTIONS FROM COVERAGE

This Policy does not insure against loss or damage, and the Company will not pay costs, attorneys’ fees, or expenses that arise by reason of:

1.                        Relative to the deletion of Standard Exceptions 1 through 5, we should be furnished the following:

1) A sworn statement disclosing all parties in possession of the land, including parties in possession under unrecorded leases and the terms and provisions thereof; options; and unrecorded contracts to purchase the land.

2) A current survey of the land, properly certified to the Company, made in accordance with (i) the accuracy requirements of a survey pursuant to the ‘Minimum Standard Detail Requirements for Land Title Surveys’ Jointly Established and Adopted by the American Land Title Association and American Congress on Survey and Mapping; and (ii) the Laws of the State of Illinois.

3) An ALTA Extended Coverage Policy Statement. If new construction has taken place within the last six months, the following should be produced: Satisfactory evidence of the payment in full of the cost of furnishing services, labor and materials in connection with any improvements made on the land within six months of the date of this commitment. This evidence should consist of sworn contractors’ and subcontractors’ affidavits, together with all necessary waivers of lien.

2.                        General real estate taxes for the year(s) 2018, 2019 and subsequent years.

The first installment of the 2018 taxes in the amount of $20,398.83 is due June 3, 2019.

The final installment of the 2018 taxes in the amount of $20,398.83 is due September 3, 2019.

The 2019 taxes are not yet ascertainable or payable.

Permanent Index Number: 09-34-137-006

If applicable, an original tax bill must be presented if taxes are to be paid at time of closing.

3.                        The land lies within the boundaries of Special Service Area Number 1B as disclosed by ordinance recorded as document 93K101485 and is subject to additional taxes under the terms of said ordinance and subsequent related ordinances.

Ordinance No. 2013-M-36 entitled An Ordinance Amending Special Service Area 1B in the City of St. Charles Kane and Dupage Counties, Illinois recorded as document 2013K043675.

4.                        The land lies within the boundaries of Special Service Area Number 25 as disclosed by ordinance recorded as document 2001K123408 and is subject to additional taxes under the terms of said ordinance and subsequent related ordinances.

5.                        Terms, provisions, covenants, conditions , options and easements as contained in Declaration of Condominium Ownership The Residences at Milestone ROW St. Charles and Provisions Relating to Certain Commercial Property recorded February 28, 2007 as Document No. 2007K022542.

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Form No. 1402.06

Policy Page 8

/s/ Jack BoltzALTA Owner’s Policy (6-17-06)

Policy Number:

First Special Amendment to Declaration of Condominium Ownership recorded January 25, 2008 as document 2008K006831.

Second Special Amendment to Declaration of Condominium Ownership The Residences at Milestone Row St. Charles and Provisions Relating to Certain Commercial Property recorded March 28, 2014 as document 2014K014675.

6.                        Terms, conditions and provisions of Ordinance No. 2001-M-69 entitled An Ordinance Proposing the Establishment of St. Charles First Street Business District in the City of St. Charles, Kane and DuPage Counties, Illinois, and Providing for a Public Hearing and Other Procedures in Connection Therewith recorded as document 2001K123407.

7.                        Utility Easement as to all areas except where permanent improvements are located as provided on the plat of Brownstone recorded January 2, 2001 document 2001K000149 and the utility provisions therein contained.

(For further particulars, see document)

8.                        This item has been intentionally deleted.

9.                        This item has been intentionally deleted.

End of Schedule B

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Table of Contents

Form No. 1402.06

Policy Page 9

D. Jack Boltz

ALTA Owner’s Policy (6-17-06)

Policy Number:

ZONING - COMPLETED
STRUCTURE ENDORSEMENT

Issued by

First American Title Insurance Company

Attached to Policy No.:

File No.: NCS-960541-CHI2

1.              The Company insures against loss or damage sustained by the Insured in the event that, at Date of Policy,

a.              according to applicable zoning ordinances and amendments, the Land is not classified Zone Planned Unit Development within CBD-1 Central Business District ;

b.              the following use or uses are not allowed under that classification: Bank

c.               There shall be no liability under paragraph 1.b. if the use or uses are not allowed as the result of any lack of compliance with any conditions, restrictions, or requirements contained in the zoning ordinances and amendments, including but not limited to the failure to secure necessary consents or authorizations as a prerequisite to the use or uses. This paragraph 1.c. does not modify or limit the coverage provided in Covered Risk 5.

2.              The Company further insures against loss or damage sustained by the Insured by reason of a final decree of a court of competent jurisdiction either prohibiting the use of the Land, with any existing structure, as specified in paragraph 1.b. or requiring the removal or alteration of the structure, because, at Date of Policy, the zoning ordinances and amendments have been violated with respect to any of the following matters:

a.              Area, width, or depth of the Land as a building site for the structure

b.              Floor space area of the structure

c.               Setback of the structure from the property lines of the Land

d.              Height of the structure, or

e.               Number of parking spaces.

3.              There shall be no liability under this endorsement based on:

a.              the invalidity of the zoning ordinances and amendments until after a final decree of a court of competent jurisdiction adjudicating the invalidity, the effect of which is to prohibit the use or uses;

b.              the refusal of any person to purchase, lease or lend money on the Title covered by this policy.

This endorsement is issued as part of the policy. Except as it expressly states, it does not (i) modify any of the terms and provisions of the policy, (ii) modify any prior endorsements, (iii) extend the Date of Policy, or (iv) increase the Amount of Insurance. To the extent a provision of the policy or a previous

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Table of Contents

Form No. 1402.06

Policy Page 10

/s/ Gregg KunesALTA Owner’s Policy (6-17-06)

Policy Number:

endorsement is inconsistent with an express provision of this endorsement, this endorsement controls. Otherwise, this endorsement is subject to all of the terms and provisions of the policy and of any prior endorsements.

Date:

Form 50-10576 (7-1-14)

Page 10 of 17

ALTA 3.1-06 Zoning - Completed Structure (Rev. 10-22-09)
CLTA 123.2-06 (Rev. 10-22-09)

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Table of Contents

Form No. 1402.06

Policy Page 11

Gregg Kunes

ALTA Owner’s Policy (6-17-06)

Policy Number:

ACCESS AND ENTRY
ENDORSEMENT

Issued by

First American Title Insurance Company

Attached to Policy No.:

File No.: NCS-960541-CHI2

The Company insures against loss or damage sustained by the Insured if, at Date of Policy (i) the Land does not abut and have both actual vehicular and pedestrian access to and from Limestone Drive and S. 1st Street (the “Street”), (ii) the Street is not physically open and publicly maintained, or (iii) the Insured has no right to use existing curb cuts or entries along that portion of the Street abutting the Land.

This endorsement is issued as part of the policy. Except as it expressly states, it does not (i) modify any of the terms and provisions of the policy, (ii) modify any prior endorsements, (iii) extend the Date of Policy, or (iv) increase the Amount of Insurance. To the extent a provision of the policy or a previous endorsement is inconsistent with an express provision of this endorsement, this endorsement controls. Otherwise, this endorsement is subject to all of the terms and provisions of the policy and of any prior endorsements.

Date:

Form 50-10045 (7-1-14)

Page 11 of 17

ALTA 17-06 Access and Entry (6-17-06)

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Table of Contents

Form No. 1402.06

Policy Page 12

/s/ Thomas NeshekALTA Owner’s Policy (6-17-06)

Policy Number:

SINGLE TAX PARCEL
ENDORSEMENT

Issued by

First American Title Insurance Company

Attached to Policy No.:

File No.: NCS-960541-CHI2

The Company insures against loss or damage sustained by the Insured by reason of the Land being taxed as part of a larger parcel of land or failing to constitute a separate tax parcel for real estate taxes.

This endorsement is issued as part of the policy. Except as it expressly states, it does not (i) modify any of the terms and provisions of the policy, (ii) modify any prior endorsements, (iii) extend the Date of Policy, or (iv) increase the Amount of Insurance. To the extent a provision of the policy or a previous endorsement is inconsistent with an express provision of this endorsement, this endorsement controls. Otherwise, this endorsement is subject to all of the terms and provisions of the policy and of any prior endorsements.

Date:

Form 50-10048 (7-1-14)

Page 12 of 17

ALTA 18-06 Single Tax Parcel (6-17-06)

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Table of Contents

Form No. 1402.06

Policy Page 13

Thomas Neshek

ALTA Owner’s Policy (6-17-06)

Policy Number:

Schedule 1

LOCATION ENDORSEMENT

Issued by

First American Title Insurance Company

Attached to Policy No.:

File No.: NCS-960541-CHI2

The Company insures against loss or damage sustained by the Insured by reason of the failure of a brick and glass exterior condominium unit known as 460 S 1st St Unit D, St. Charles IL, to be located on the Land at Date of Policy.

This endorsement is issued as part of the policy. Except as it expressly states, it does not (i) modify any of the terms and provisions of the policy, (ii) modify any prior endorsements, (iii) extend the Date of Policy, or (iv) increase the Amount of Insurance. To the extent a provision of the policy or a previous endorsement is inconsistent with an express provision of this endorsement, this endorsement controls. Otherwise, this endorsement is subject to all of the terms and provisions of the policy and of any prior endorsements.

Date:

Form 50-10054 (7-1-14)

Page 13 of 17

ALTA 22-06 Location (6-17-06)

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Table of Contents

 

Form No. 1402.06

Policy Page 14

ALTA Owner’s Policy (6-17-06)

Policy Number:

SAME AS SURVEY ENDORSEMENT

Issued by

First American Title Insurance Company

Attached to Policy No.:

File No.: NCS-960541-CHI2

The Company insures against loss or damage sustained by the Insured by reason of the failure of the Land as described in Schedule A to be the same as that identified on the survey made by Doland Engineering, LLC dated May 17, 2019, last revised May 31, 2019, and designated Job No. .

This endorsement is issued as part of the policy. Except as it expressly states, it does not (i) modify any of the terms and provisions of the policy, (ii) modify any prior endorsements, (iii) extend the Date of Policy, or (iv) increase the Amount of Insurance. To the extent a provision of the policy or a previous endorsement is inconsistent with an express provision of this endorsement, this endorsement controls. Otherwise, this endorsement is subject to all of the terms and provisions of the policy and of any prior endorsements.

Date:

Form 50-10059 (7-1-14)

Page 14 of 17

ALTA 25-06 Same as Survey (10-16-08)
CLTA 116.1-06 (10-16-08)

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Table of Contents

Form No. 1402.06

Policy Page 15

ALTA Owner’s Policy (6-17-06)

Policy Number:

PLANNED UNIT DEVELOPMENT
ENDORSEMENT

Issued by

First American Title Insurance Company

Attached to Policy No.:

File No.: NCS-960541-CHI2

The Company insures against loss or damage sustained by the Insured by reason of:

1.              Present violations of any restrictive covenants referred to in Schedule B that restrict the use of the Land or the forfeiture or reversion of Title by reason of any provision contained in the restrictive covenants. As used in this paragraph 1, the words “restrictive covenants” do not refer to or include any covenant, condition, or restriction (a) relating to obligations of any type to perform maintenance, repair, or remediation on the Land, or (b) pertaining to environmental protection of any kind or nature, including hazardous or toxic matters, conditions, or substances, except to the extent that a notice of a violation or alleged violation affecting the Land has been recorded in the Public Records at Date of Policy and is not excepted in Schedule B.

2.              Any charges or assessments in favor of any association of homeowners, that are provided for in any document referred to in Schedule B, due and unpaid at Date of Policy.

3.              The enforced removal of any existing structure on the Land (other than a boundary wall or fence) because it encroaches onto adjoining land or onto any easements.

4.              The failure of the Title by reason of a right of first refusal to purchase the Land that was exercised or could have been exercised at Date of Policy.

This endorsement is issued as part of the policy. Except as it expressly states, it does not (i) modify any of the terms and provisions of the policy, (ii) modify any prior endorsements, (iii) extend the Date of Policy, or (iv) increase the Amount of Insurance. To the extent a provision of the policy or a previous endorsement is inconsistent with an express provision of this endorsement, this endorsement controls. Otherwise, this endorsement is subject to all of the terms and provisions of the policy and of any prior endorsements.

Date:

Form 50-10012 (7-1-14)

Page 15 of 17

ALTA 5.1-06 Planned Unit Development (Rev. 10-16-08)
CLTA 115.4-06 (6-17-06)

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Table of Contents

Form No. 1402.06

Policy Page 16

ALTA Owner’s Policy (6-17-06)

Policy Number:

POLICY AUTHENTICATION ENDORSEMENT

Issued by

First American Title Insurance Company

Attached to Policy No.:

File No.: NCS-960541-CHI2

When the policy is issued by the Company with a policy number and Date of Policy, the Company will not deny liability under the policy or any endorsements issued with the policy solely on the grounds that the policy or endorsements were issued electronically or lack signatures in accordance with the Conditions.

This endorsement is issued as part of the policy. Except as it expressly states, it does not (i) modify any of the terms and provisions of the policy, (ii) modify any prior endorsements, (iii) extend the Date of Policy, or (iv) increase the Amount of Insurance. To the extent a provision of the policy or a previous endorsement is inconsistent with an express provision of this endorsement, this endorsement controls. Otherwise, this endorsement is subject to all of the terms and provisions of the policy and of any prior endorsements.

Date:

Form 50-10899 (7-1-14)

Page 16 of 17

ALTA 39.0-06 Policy Authentication (4-2-13)

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Table of Contents

Form No. 1402.06

Policy Page 17

ALTA Owner’s Policy (6-17-06)

Policy Number:

Privacy Information

We Are Committed to Safeguarding Customer Information

In order to better serve your needs now and in the future, we may ask you to provide us with certain information. We understand that you may be concerned about what we will do with such information - particularly any personal or financial information. We agree that you have a right to know how we will utilize the personal information you provide to us. Therefore, together with our subsidiaries we have adopted this Privacy Policy to govern the use and handling of your personal information.

Applicability

This Privacy Policy governs our use of the information that you provide to us. It does not govern the manner in which we may use information we have obtained from any other source, such as information obtained from a public record or from another person or entity. First American has also adopted broader guidelines that govern our use of personal information regardless of its source. First American calls these guidelines its Fair Information Values.

Types of Information

Depending upon which of our services you are utilizing, the types of nonpublic personal information that we may collect include:

·   Information we receive from you on applications, forms and in other communications to us, whether in writing, in person, by telephone or any other means;

·   Information about your transactions with us, our affiliated companies, or others; and

·   Information we receive from a consumer reporting agency.

Use of Information

We request information from you for our own legitimate business purposes and not for the benefit of any nonaffiliated party. Therefore, we will not release your information to nonaffiliated parties except: (1) as necessary for us to provide the product or service you have requested of us; or (2) as permitted by law. We may, however, store such information indefinitely, including the period  after which any customer relationship has ceased. Such information may be used for any internal purpose, such as quality control efforts or customer analysis. We may also provide all of the types of nonpublic personal information listed above to one or more of our affiliated companies. Such affiliated companies include financial service providers, such as title insurers, property and casualty insurers, and trust and investment advisory companies, or companies involved in real estate services, such as appraisal companies, home warranty companies and escrow companies. Furthermore, we may also provide all the information we collect, as described above, to companies that perform marketing services on our behalf, on behalf of our affiliated companies or to other financial institutions with whom we or our affiliated companies have joint marketing agreements.

Former Customers

Even if you are no longer our customer, our Privacy Policy will continue to apply to you.

Confidentiality and Security

We will use our best efforts to ensure that no unauthorized parties have access to any of your information. We restrict access to nonpublic personal information about you to those individuals and entities who need to know that information to provide products or services to you. We will use our best efforts to train and oversee our employees and agents to ensure that your information will be handled responsibly and in accordance with this Privacy Policy and First American’s Fair Information Values. We currently maintain physical, electronic, and procedural safeguards that comply with federal regulations to guard your nonpublic personal information.

Information Obtained Through Our Web Site

First American Financial Corporation is sensitive to privacy issues on the Internet. We believe it is important you know how we treat the information about you we receive on the Internet.

In general, you can visit First American or its affiliates’ Web sites on the World Wide Web without telling us who you are or revealing any information about yourself. Our Web servers collect the domain names, not the e-mail addresses, of visitors. This information is aggregated to measure the number of visits, average time spent on the site, pages viewed and similar information. First American uses this information to measure the use of our site and to develop ideas to improve the content of our site.

There are times, however, when we may need information from you, such as your name and email address. When information is needed, we will use our best efforts to let you know at the time of collection how we will use the personal information. Usually, the personal information we collect is used only by us to respond to your inquiry, process an order or allow you to access specific account/profile information. If you choose to share any personal information with us, we will only use it in accordance with the policies outlined above.

Business Relationships

First American Financial Corporation’s site and its affiliates’ sites may contain links to other Web sites. While we try to link only to sites that share our high standards and respect for privacy, we are not responsible for the content or the privacy practices employed by other sites.

Cookies

Some of First American’s Web sites may make use of “cookie” technology to measure site activity and to customize information to your personal tastes. A cookie is an element of data that a Web site can send to your browser, which may then store the cookie on your hard drive.

FirstAm.com uses stored cookies. The goal of this technology is to better serve you when visiting our site, save you time when you are here and to provide you with a more meaningful and productive Web site experience.

Fair Information Values

Fairness We consider consumer expectations about their privacy in all our businesses. We only offer products and services that assure a favorable balance between consumer benefits and consumer privacy.

Public Record We believe that an open public record creates significant value for society, enhances consumer choice and creates consumer opportunity. We actively support an open public record and emphasize its importance and contribution to our economy.

Use We believe we should behave responsibly when we use information about a consumer in our business. We will obey the laws governing the collection, use and dissemination of data.

Accuracy We will take reasonable steps to help assure the accuracy of the data we collect, use and disseminate. Where possible, we will take reasonable steps to correct inaccurate information. When, as with the public record, we cannot correct inaccurate information, we will take all reasonable steps to assist consumers in identifying the source of the erroneous data so that the consumer can secure the required corrections.

Education We endeavor to educate the users of our products and services, our employees and others in our industry about the importance of consumer privacy. We will instruct our employees on our fair information values and on the responsible collection and use of data. We will encourage others in our industry to collect and use information in a responsible manner.

Security We will maintain appropriate facilities and systems to protect against unauthorized access to and corruption of the data we maintain.

Form 50-PRIVACY (9/1/10)

Page 1 of 1

Privacy Information (2001-2010 First American Financial Corporation)

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Table of Contents

Exhibit D-2

Proforma Policy for Foxfield Property

See Attached.

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Table of Contents

Form No. 1402.06

ALTA Owner’s Policy (6-17-06)
1100302P050600

Policy Page 1
Policy Number:           

OWNER’S POLICY OF TITLE INSURANCE

ISSUED BY

First American Title Insurance Company

Any notice of claim and any other notice or statement in writing required to be given to the Company under this policy must be given to the Company at the address shown in Section 18 of the Conditions.

COVERED RISKS

SUBJECT TO THE EXCLUSIONS FROM COVERAGE, THE EXCEPTIONS FROM COVERAGE CONTAINED IN SCHEDULE B AND THE CONDITIONS, FIRST AMERICAN TITLE INSURANCE COMPANY, a Nebraska corporation (the “Company”) insures, as of Date of Policy and, to the extent stated in Covered Risks 9 and 10, after Date of Policy, against loss or damage, not exceeding the Amount of Insurance, sustained or incurred by the Insured by reason of:

1.              Title being vested other than as stated in Schedule A.

2.              Any defect in or lien or encumbrance on the Title. This Covered Risk includes but is not limited to insurance against loss from

(a)         A defect in the Title caused by

(i)             forgery, fraud, undue influence, duress, incompetency, incapacity, or impersonation;

(ii)          failure of any person or Entity to have authorized a transfer or conveyance;

(iii)       a document affecting Title not properly created, executed, witnessed, sealed, acknowledged, notarized, or delivered;

(iv)      failure to perform those acts necessary to create a document by electronic means authorized by law;

(v)         a document executed under a falsified, expired, or otherwise invalid power of attorney;

(vi)      a document not properly filed, recorded, or indexed in the Public Records including failure to perform those acts by electronic means authorized by law; or

(vii)   a defective judicial or administrative proceeding.

(b)         The lien of real estate taxes or assessments imposed on the Title by a governmental authority due or payable, but unpaid.

(c)          Any encroachment, encumbrance, violation, variation, or adverse circumstance affecting the Title that would be disclosed by an accurate and complete land survey of the Land. The term “encroachment” includes encroachments of existing improvements located on the Land onto adjoining land, and encroachments onto the Land of existing improvements located on adjoining land.

3.              Unmarketable Title.

4.              No right of access to and from the Land.

5.              The violation or enforcement of any law, ordinance, permit, or governmental regulation (including those relating to building and zoning) restricting, regulating, prohibiting, or relating to

(a)         the occupancy, use, or enjoyment of the Land;

(b)         the character, dimensions, or location of any improvement erected on the Land;

(c)          the subdivision of land; or

(d)         environmental protection

if a notice, describing any part of the Land, is recorded in the Public Records setting forth the violation or intention to enforce, but only to the extent of the violation or enforcement referred to in that notice.

6.              An enforcement action based on the exercise of a governmental police power not covered by Covered Risk 5 if a notice of the enforcement action, describing any part of the Land, is recorded in the Public Records, but only to the extent of the enforcement referred to in that notice.

7.              The exercise of the rights of eminent domain if a notice of the exercise, describing any part of the Land, is recorded in the Public Records.

8.              Any taking by a governmental body that has occurred and is binding on the rights of a purchaser for value without Knowledge.

9.              Title being vested other than as stated in Schedule A or being defective

(a)         as a result of the avoidance in whole or in part, or from a court order providing an alternative remedy, of a transfer of all or any part of the title to or any interest in the Land occurring prior to the transaction vesting Title as shown in Schedule A because that prior transfer constituted a fraudulent or preferential transfer under federal bankruptcy, state insolvency, or similar creditors’ rights laws; or

(b)         because the instrument of transfer vesting Title as shown in Schedule A constitutes a preferential transfer under federal bankruptcy, state insolvency, or similar creditors’ rights laws by reason of the failure of its recording in the Public Records

(i)        to be timely, or

(ii)     to impart notice of its existence to a purchaser for value or to a judgment or lien creditor.

10.       Any defect in or lien or encumbrance on the Title or other matter included in Covered Risks 1 through 9 that has been created or attached or has been filed or recorded in the Public Records subsequent to Date of Policy and prior to the recording of the deed or other instrument of transfer in the Public Records that vests Title as shown in Schedule A.

The Company will also pay the costs, attorneys’ fees, and expenses incurred in defense of any matter insured against by this policy, but only to the extent provided in the Conditions.

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Table of Contents

Form No. 1402.06

ALTA Owner’s Policy (6-17-06)

Policy Page 2
Policy Number:

EXCLUSIONS FROM COVERAGE

The following matters are expressly excluded from the coverage of this policy, and the Company will not pay loss or damage, costs, attorneys’ fees, or expenses that arise by reason of:

1.              (a)         Any law, ordinance, permit, or governmental regulation (including those relating to building and zoning) restricting, regulating, prohibiting, or relating to

(i)             the occupancy, use, or enjoyment of the Land;

(ii)          the character, dimensions, or location of any improvement erected on the Land;

(iii)       the subdivision of land; or

(iv)      environmental protection;

or the effect of any violation of these laws, ordinances, or governmental regulations. This Exclusion 1(a) does not modify or limit the coverage provided under Covered Risk 5.

(b)         Any governmental police power. This Exclusion 1(b) does not modify or limit the coverage provided under Covered Risk 6.

2.              Rights of eminent domain. This Exclusion does not modify or limit the coverage provided under Covered Risk 7 or 8.

3.              Defects, liens, encumbrances, adverse claims, or other matters

(a)         created, suffered, assumed, or agreed to by the Insured Claimant;

(b)         not Known to the Company, not recorded in the Public Records at Date of Policy, but Known to the Insured Claimant and not disclosed in writing to the Company by the Insured Claimant prior to the date the Insured Claimant became an Insured under this policy;

(c)          resulting in no loss or damage to the Insured Claimant;

(d)         attaching or created subsequent to Date of Policy (however, this does not modify or limit the coverage provided under Covered Risks 9 and 10); or

(e)          resulting in loss or damage that would not have been sustained if the Insured Claimant had paid value for the Title.

4.              Any claim, by reason of the operation of federal bankruptcy, state insolvency, or similar creditors’ rights laws, that the transaction vesting the Title as shown in Schedule A, is

(a)         a fraudulent conveyance or fraudulent transfer; or

(b)         a preferential transfer for any reason not stated in Covered Risk 9 of this policy.

5.              Any lien on the Title for real estate taxes or assessments imposed by governmental authority and created or attaching between Date of Policy and the date of recording of the deed or other instrument of transfer in the Public Records that vests Title as shown in Schedule A.

CONDITIONS

1.DEFINITION OF TERMS

The following terms when used in this policy mean:

(a)         “Amount of Insurance”: The amount stated in Schedule A, as may be increased or decreased by endorsement to this policy, increased by Section 8(b), or decreased by Sections 10 and 11 of these Conditions.

(b)         “Date of Policy”: The date designated as “Date of Policy” in Schedule A.

(c)          “Entity”: A corporation, partnership, trust, limited liability company, or other similar legal entity.

(d)         “Insured”: The Insured named in Schedule A.

(i)             The term “Insured” also includes

(A)       successors to the Title of the Insured by operation of law as distinguished from purchase, including heirs, devisees, survivors, personal representatives, or next of kin;

(B)       successors to an Insured by dissolution, merger, consolidation, distribution, or reorganization;

(C)       successors to an Insured by its conversion to another kind of Entity;

(D)       a grantee of an Insured under a deed delivered without payment of actual valuable consideration conveying the Title

(1)         if the stock, shares, memberships, or other equity interests of the grantee are wholly-owned by the named Insured,

(2)         if the grantee wholly owns the named Insured,

(3)         if the grantee is wholly-owned by an affiliated Entity of the named Insured, provided the affiliated Entity and the named Insured are both wholly-owned by the same person or Entity, or

(4)         if the grantee is a trustee or beneficiary of a trust created by a written instrument established by the Insured named in Schedule A for estate planning purposes.

(ii)       With regard to (A), (B), (C), and (D) reserving, however, all rights and defenses as to any successor that the Company would have had against any predecessor Insured.

(e)          “Insured Claimant”: An Insured claiming loss or damage.

(f)           “Knowledge” or “Known”: Actual knowledge, not constructive knowledge or notice that may be imputed to an Insured by reason of the Public Records or any other records that impart constructive notice of matters affecting the Title.

(g)          “Land”: The land described in Schedule A, and affixed improvements that by law constitute real property. The term “Land” does not include any property beyond the lines of the area described in Schedule A, nor any right, title, interest, estate, or easement in abutting streets, roads, avenues, alleys, lanes, ways, or waterways, but this does not modify or limit the extent that a right of access to and from the Land is insured by this policy.

(h)         “Mortgage”: Mortgage, deed of trust, trust deed, or other security instrument, including one evidenced by electronic means authorized by law.

(i)             “Public Records”: Records established under state statutes at Date of Policy for the purpose of imparting constructive notice of matters relating to real property to purchasers for value and without Knowledge. With respect to Covered Risk 5(d), “Public Records” shall also include environmental protection liens filed in the records of the clerk of the United States District Court for the district where the Land is located.

(j)            “Title”: The estate or interest described in Schedule A.

(k)         “Unmarketable Title”: Title affected by an alleged or apparent matter that would permit a prospective purchaser or lessee of the Title or lender on the Title to be released from the obligation to purchase, lease, or lend if there is a contractual condition requiring the delivery of marketable title.

2.CONTINUATION OF INSURANCE

The coverage of this policy shall continue in force as of Date of Policy in favor of an Insured, but only so long as the Insured retains an estate or interest in the Land, or holds an obligation secured by a purchase money Mortgage given by a purchaser from the Insured, or only so long as the Insured shall have liability by reason of warranties in any transfer or conveyance of the Title. This policy shall not continue in force in favor of any purchaser from the Insured of either (i) an estate or interest in the Land, or (ii) an obligation secured by a purchase money Mortgage given to the Insured.

3.NOTICE OF CLAIM TO BE GIVEN BY INSURED CLAIMANT

The Insured shall notify the Company promptly in writing (i) in case of any litigation as set forth in Section 5(a) of these Conditions, (ii) in case Knowledge shall come to an Insured hereunder of any claim of title or interest that is adverse to the Title, as insured, and that might cause loss or damage for which the Company may be liable by virtue of this policy, or (iii) if the Title, as insured, is rejected as Unmarketable Title. If the Company is prejudiced by the failure of the Insured Claimant to provide prompt notice, the Company’s liability to the Insured Claimant under the policy shall be reduced to the extent of the prejudice.

4.PROOF OF LOSS

In the event the Company is unable to determine the amount of loss or damage, the Company may, at its option, require as a condition of payment that the Insured Claimant furnish a signed proof of loss. The proof of loss must describe the defect, lien, encumbrance, or other matter insured against by this policy that constitutes the basis of loss or damage and shall state, to the extent possible, the basis of calculating the amount of the loss or damage.

5.DEFENSE AND PROSECUTION OF ACTIONS

(a)         Upon written request by the Insured, and subject to the options contained in Section 7 of these Conditions, the Company, at its own cost and without unreasonable delay, shall provide for the defense of an Insured in litigation in which any third party asserts a claim covered by this policy adverse to the Insured. This obligation is limited to only those stated causes of action alleging matters insured against by this policy. The Company shall have the right to select counsel of its choice (subject to the right of the Insured to object for reasonable cause) to represent the Insured as to those stated causes of action. It shall not be liable for and will not pay the fees of any other counsel. The Company will not pay any fees, costs, or expenses incurred by the Insured in the defense of those causes of action that allege matters not insured against by this policy.

(b)         The Company shall have the right, in addition to the options contained in

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Table of Contents

Form No. 1402.06

ALTA Owner’s Policy (6-17-06)

Policy Page 3
Policy Number:

Section 7 of these Conditions, at its own cost, to institute and prosecute any action or proceeding or to do any other act that in its opinion may be necessary or desirable to establish the Title, as insured, or to prevent or reduce loss or damage to the Insured. The Company may take any appropriate action under the terms of this policy, whether or not it shall be liable to the Insured. The exercise of these rights shall not be an admission of liability or waiver of any provision of this policy. If the Company exercises its rights under this subsection, it must do so diligently.

(c)          Whenever the Company brings an action or asserts a defense as required or permitted by this policy, the Company may pursue the litigation to a final determination by a court of competent jurisdiction, and it expressly reserves the right, in its sole discretion, to appeal any adverse judgment or order.

6.DUTY OF INSURED CLAIMANT TO COOPERATE

(a)         In all cases where this policy permits or requires the Company to prosecute or provide for the defense of any action or proceeding and any appeals, the Insured shall secure to the Company the right to so prosecute or provide defense in the action or proceeding, including the right to use, at its option, the name of the Insured for this purpose. Whenever requested by the Company, the Insured, at the Company’s expense, shall give the Company all reasonable aid (i) in securing evidence, obtaining witnesses, prosecuting or defending the action or proceeding, or effecting settlement, and (ii) in any other lawful act that in the opinion of the Company may be necessary or desirable to establish the Title or any other matter as insured. If the Company is prejudiced by the failure of the Insured to furnish the required cooperation, the Company’s obligations to the Insured under the policy shall terminate, including any liability or obligation to defend, prosecute, or continue any litigation, with regard to the matter or matters requiring such cooperation.

(b)         The Company may reasonably require the Insured Claimant to submit to examination under oath by any authorized representative of the Company and to produce for examination, inspection, and copying, at such reasonable times and places as may be designated by the authorized representative of the Company, all records, in whatever medium maintained, including books, ledgers, checks, memoranda, correspondence, reports, e-mails, disks, tapes, and videos whether bearing a date before or after Date of Policy, that reasonably pertain to the loss or damage. Further, if requested by any authorized representative of the Company, the Insured Claimant shall grant its permission, in writing, for any authorized representative of the Company to examine, inspect, and copy all of these records in the custody or control of a third party that reasonably pertain to the loss or damage. All information designated as confidential by the Insured Claimant provided to the Company pursuant to this Section shall not be disclosed to others unless, in the reasonable judgment of the Company, it is necessary in the administration of the claim. Failure of the Insured Claimant to submit for examination under oath, produce any reasonably requested information, or grant permission to secure reasonably necessary information from third parties as required in this subsection, unless prohibited by law or governmental regulation, shall terminate any liability of the Company under this policy as to that claim.

7.OPTIONS TO PAY OR OTHERWISE SETTLE CLAIMS; TERMINATION OF LIABILITY

In case of a claim under this policy, the Company shall have the following additional options:

(a)         To Pay or Tender Payment of the Amount of Insurance.

To pay or tender payment of the Amount of Insurance under this policy together with any costs, attorneys’ fees, and expenses incurred by the Insured Claimant that were authorized by the Company up to the time of payment or tender of payment and that the Company is obligated to pay. Upon the exercise by the Company of this option, all liability and obligations of the Company to the Insured under this policy, other than to make the payment required in this subsection, shall terminate, including any liability or obligation to defend, prosecute, or continue any litigation.

(b)         To Pay or Otherwise Settle With Parties Other Than the Insured or With the Insured Claimant.

(i)             To pay or otherwise settle with other parties for or in the name of an Insured Claimant any claim insured against under this policy. In addition, the Company will pay any costs, attorneys’ fees, and expenses incurred by the Insured Claimant that were authorized by the Company up to the time of payment and that the Company is obligated to pay; or

(ii)          To pay or otherwise settle with the Insured Claimant the loss or damage provided for under this policy, together with any costs, attorneys’ fees, and expenses incurred by the Insured Claimant that were authorized by the Company up to the time of payment and that the Company is obligated to pay.

Upon the exercise by the Company of either of the options provided for in subsections (b)(i) or (ii), the Company’s obligations to the Insured under this policy for the claimed loss or damage, other than the payments required to be made, shall terminate, including any liability or obligation to defend, prosecute, or continue any litigation.

8.DETERMINATION AND EXTENT OF LIABILITY

This policy is a contract of indemnity against actual monetary loss or damage sustained or incurred by the Insured Claimant who has suffered loss or damage by reason of matters insured against by this policy.

(a)         The extent of liability of the Company for loss or damage under this policy shall not exceed the lesser of

(i)        the Amount of Insurance; or

(ii)     the difference between the value of the Title as insured and the value of the Title subject to the risk insured against by this policy.

(b)         If the Company pursues its rights under Section 5 of these Conditions and is unsuccessful in establishing the Title, as insured,

(i)          the Amount of Insurance shall be increased by 10%, and

(ii)       the Insured Claimant shall have the right to have the loss or damage determined either as of the date the claim was made by the Insured Claimant or as of the date it is settled and paid.

(c)          In addition to the extent of liability under (a) and (b), the Company will also pay those costs, attorneys’ fees, and expenses incurred in accordance with Sections 5 and 7 of these Conditions.

9.LIMITATION OF LIABILITY

(a)         If the Company establishes the Title, or removes the alleged defect, lien, or encumbrance, or cures the lack of a right of access to or from the Land, or cures the claim of Unmarketable Title, all as insured, in a reasonably diligent manner by any method, including litigation and the completion of any appeals, it shall have fully performed its obligations with respect to that matter and shall not be liable for any loss or damage caused to the Insured.

(b)         In the event of any litigation, including litigation by the Company or with the Company’s consent, the Company shall have no liability for loss or damage until there has been a final determination by a court of competent jurisdiction, and disposition of all appeals, adverse to the Title, as insured.

(c)          The Company shall not be liable for loss or damage to the Insured for liability voluntarily assumed by the Insured in settling any claim or suit without the prior written consent of the Company.

10.REDUCTION OF INSURANCE; REDUCTION OR TERMINATION OF LIABILITY

All payments under this policy, except payments made for costs, attorneys’ fees, and expenses, shall reduce the Amount of Insurance by the amount of the payment.

11.LIABILITY NONCUMULATIVE

The Amount of Insurance shall be reduced by any amount the Company pays under any policy insuring a Mortgage to which exception is taken in Schedule B or to which the Insured has agreed, assumed, or taken subject, or which is executed by an Insured after Date of Policy and which is a charge or lien on the Title, and the amount so paid shall be deemed a payment to the Insured under this policy.

12.PAYMENT OF LOSS

When liability and the extent of loss or damage have been definitely fixed in accordance with these Conditions, the payment shall be made within 30 days.

13.RIGHTS OF RECOVERY UPON PAYMENT OR SETTLEMENT

(a)         Whenever the Company shall have settled and paid a claim under this policy, it shall be subrogated and entitled to the rights of the Insured Claimant in the Title and all other rights and remedies in respect to the claim that the Insured Claimant has against any person or property, to the extent of the amount of any loss, costs, attorneys’ fees, and expenses paid by the Company. If requested by the Company, the Insured Claimant shall execute documents to evidence the transfer to the Company of these rights and remedies. The Insured Claimant shall permit the Company to sue, compromise, or settle in the name of the Insured Claimant and to use the name of the Insured Claimant in any transaction or litigation involving these rights and remedies.

If a payment on account of a claim does not fully cover the loss of the Insured Claimant, the Company shall defer the exercise of its right to recover until after the Insured Claimant shall have recovered its loss.

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Table of Contents

Form No. 1402.06

ALTA Owner’s Policy (6-17-06)

Policy Page 4
Policy Number:

(b)         The Company’s right of subrogation includes the rights of the Insured to indemnities, guaranties, other policies of insurance, or bonds, notwithstanding any terms or conditions contained in those instruments that address subrogation rights.

14.ARBITRATION

Either the Company or the Insured may demand that the claim or controversy shall be submitted to arbitration pursuant to the Title Insurance Arbitration Rules of the American Land Title Association (“Rules”). Except as provided in the Rules, there shall be no joinder or consolidation with claims or controversies of other persons. Arbitrable matters may include, but are not limited to, any controversy or claim between the Company and the Insured arising out of or relating to this policy, any service in connection with its issuance or the breach of a policy provision, or to any other controversy or claim arising out of the transaction giving rise to this policy. All arbitrable matters when the Amount of Insurance is $2,000,000 or less shall be arbitrated at the option of either the Company or the Insured. All arbitrable matters when the Amount of Insurance is in excess of $2,000,000 shall be arbitrated only when agreed to by both the Company and the Insured. Arbitration pursuant to this policy and under the Rules shall be binding upon the parties. Judgment upon the award rendered by the Arbitrator(s) may be entered in any court of competent jurisdiction.

15.LIABILITY LIMITED TO THIS POLICY; POLICY ENTIRE CONTRACT

(a)         This policy together with all endorsements, if any, attached to it by the Company is the entire policy and contract between the Insured and the Company. In interpreting any provision of this policy, this policy shall be construed as a whole.

(b)         Any claim of loss or damage that arises out of the status of the Title or by any action asserting such claim shall be restricted to this policy.

(c)          Any amendment of or endorsement to this policy must be in writing and authenticated by an authorized person, or expressly incorporated by Schedule A of this policy.

(d)         Each endorsement to this policy issued at any time is made a part of this policy and is subject to all of its terms and provisions. Except as the endorsement expressly states, it does not (i) modify any of the terms and provisions of the policy, (ii) modify any prior endorsement, (iii) extend the Date of Policy, or (iv) increase the Amount of Insurance.

16.SEVERABILITY

In the event any provision of this policy, in whole or in part, is held invalid or unenforceable under applicable law, the policy shall be deemed not to include that provision or such part held to be invalid, but all other provisions shall remain in full force and effect.

17.CHOICE OF LAW; FORUM

(a)         Choice of Law: The Insured acknowledges the Company has underwritten the risks covered by this policy and determined the premium charged therefore in reliance upon the law affecting interests in real property and applicable to the interpretation, rights, remedies, or enforcement of policies of title insurance of the jurisdiction where the Land is located. Therefore, the court or an arbitrator shall apply the law of the jurisdiction where the Land is located to determine the validity of claims against the Title that are adverse to the Insured and to interpret and enforce the terms of this policy. In neither case shall the court or arbitrator apply its conflicts of law principles to determine the applicable law.

(b)         Choice of Forum: Any litigation or other proceeding brought by the Insured against the Company must be filed only in a state or federal court within the United States of America or its territories having appropriate jurisdiction.

18.NOTICES, WHERE SENT

Any notice of claim and any other notice or statement in writing required to be given to the Company under this policy must be given to the Company at 1 First American Way, Santa Ana, CA 92707, Attn: Claims Department.

POLICY OF TITLE INSURANCE

A-1-D2-5


Table of Contents

Form No. 1402.06

ALTA Owner’s Policy (6-17-06)

Policy Page 5
Policy Number:

SCHEDULE A

First American Title Insurance Company

Name and Address of the issuing Title Insurance Company:

First American Title Insurance Company

30 North LaSalle Street, Suite 2700

Chicago, IL 60602

File No.: NCS-960539-CHI2

Policy No.:

Amount of Insurance: $2,216,581.00

Date of Policy:  [Date of recording at time of recording]

1.                                      Name of Insured:

TBD

2.                                      The estate or interest in the Land that is insured by this policy is:

Fee Simple

3.                                      Title is vested in:

TBD

4.                                      The Land referred to in this policy is described as follows:

Real property in the City of St. Charles, County of Kane, State of Illinois, described as follows:

LOT 1 OF FOXFIELD COMMONS, UNIT 3 BEING A SUBDIVISION OF PART OF THE NORTHWEST ¼ OF SECTION 25, TOWNSHIP 40 NORTH, RANGE 8, EAST OF THE THIRD PRINCIPAL MERIDIAN, IN THE CITY OF ST. CHARLES, KANE COUNTY, ILLINOIS, ACCORDING TO THE PLAT THEREOF RECORDED DECEMBER 21, 2006 AS DOCUMENT 2006K138423.

A-1-D2-6


Table of Contents

Form No. 1402.06

ALTA Owner’s Policy (6-17-06)

Policy Page 6
Policy Number:

SCHEDULE B

File No.: NCS-960539-CHI2

Policy No.:

EXCEPTIONS FROM COVERAGE

This Policy does not insure against loss or damage, and the Company will not pay costs, attorneys’ fees, or expenses that arise by reason of:

1.                                      General real estate taxes for the year(s) 2018, 2019 and subsequent years.

The first installment of the 2018 taxes in the amount of $29,296.53 is Due, June 03, 2019.

The final installment of the 2018 taxes in the amount of $29,296.53 is Due, September 03, 2019.

The 2019 taxes are not yet ascertainable or payable.

Permanent Index Number: 09-25-152-006

If applicable, an original tax bill must be presented if taxes are to be paid at time of closing.

2.                                      Terms, conditions and provisions of Ordinance No. 1991-Z-4 entitled An Ordinance Amending Ordinance No. 1975-Z-16 and Ordinance No. 1990-Z-11 (Foxfield PUD Amendments) recorded as document 91K29741.

3.                                      Blanket Public Utilities and City Easement except where permanent building or structure located per plat of Foxfield Commons Unit 3 document 2006K138423.

(see plat for exact location)

4.                                      Grant of Public Utilities Easement dated November 30, 1990 and recorded January 22, 1991 as document 91K03433 made by First Chicago Trust Company of Illinois as Trustee under Trust number 10471 to the Illinois Bell Telephone Company, its successors and assigns.

Affects Southerly 10 feet Lot 1 of Foxfield Commons Unit 3 document 2006K138423.

5.                                      Grant of Public Utilities Easement dated November 20, 1990 and recorded January 29, 1991 as document 91K04541 made by First Chicago Trust Company as Trustee under Trust number 10471 to Northern Illinois Gas Company, its successors and assigns. Affects Southerly 10 feet Lot 1 of Foxfield Commons Unit 3 document 2006K138423.

6.                                      Utility and Drainage Easement per Foxfield Commons Unit 3 document 2006K138423.

Affects South 20 feet, 10 feet on all other lot lines and also 10 foot strips in North part see plat of Lot 1.

7.                                      This item has been intentionally deleted.

End of Schedule B

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Table of Contents

Form No. 1402.06

ALTA Owner’s Policy (6-17-06)

Policy Page 8
Policy Number:

ZONING - COMPLETED
STRUCTURE ENDORSEMENT

Issued by

First American Title Insurance Company

Attached to Policy No.:

File No.: NCS-960539-CHI2

1.              The Company insures against loss or damage sustained by the Insured in the event that, at Date of Policy,

a.              according to applicable zoning ordinances and amendments, the Land is not classified Zone BC Community Business District;

b.              the following use or uses are not allowed under that classification: Bank

c.               There shall be no liability under paragraph 1.b. if the use or uses are not allowed as the result of any lack of compliance with any conditions, restrictions, or requirements contained in the zoning ordinances and amendments, including but not limited to the failure to secure necessary consents or authorizations as a prerequisite to the use or uses. This paragraph 1.c. does not modify or limit the coverage provided in Covered Risk 5.

2.              The Company further insures against loss or damage sustained by the Insured by reason of a final decree of a court of competent jurisdiction either prohibiting the use of the Land, with any existing structure, as specified in paragraph 1.b. or requiring the removal or alteration of the structure, because, at Date of Policy, the zoning ordinances and amendments have been violated with respect to any of the following matters:

a.              Area, width, or depth of the Land as a building site for the structure

b.              Floor space area of the structure

c.               Setback of the structure from the property lines of the Land

d.              Height of the structure, or

e.               Number of parking spaces.

3.              There shall be no liability under this endorsement based on:

a.              the invalidity of the zoning ordinances and amendments until after a final decree of a court of competent jurisdiction adjudicating the invalidity, the effect of which is to prohibit the use or uses;

b.              the refusal of any person to purchase, lease or lend money on the Title covered by this policy.

This endorsement is issued as part of the policy. Except as it expressly states, it does not (i) modify any of the terms and provisions of the policy, (ii) modify any prior endorsements, (iii) extend the Date of Policy, or (iv) increase the Amount of Insurance. To the extent a provision of the policy or a previous

A-1-D2-8


Table of Contents

Form No. 1402.06

ALTA Owner’s Policy (6-17-06)

Policy Page 9
Policy Number:

endorsement is inconsistent with an express provision of this endorsement, this endorsement controls. Otherwise, this endorsement is subject to all of the terms and provisions of the policy and of any prior endorsements.

Date:

Form 50-10576 (7-1-14)

Page 9 of 17

ALTA 3.1-06 Zoning - Completed Structure (Rev. 10-22-09)
CLTA 123.2-06 (Rev. 10-22-09)

A-1-D2-9


Table of Contents

Form No. 1402.06

ALTA Owner’s Policy (6-17-06)

Policy Page 10
Policy Number:

ACCESS AND ENTRY
ENDORSEMENT

Issued by

First American Title Insurance Company

Attached to Policy No.:

File No.: NCS-960539-CHI2

The Company insures against loss or damage sustained by the Insured if, at Date of Policy (i) the Land does not abut and have both actual vehicular and pedestrian access to and from Foxfield Road (the “Street”), (ii) the Street is not physically open and publicly maintained, or (iii) the Insured has no right to use existing curb cuts or entries along that portion of the Street abutting the Land.

This endorsement is issued as part of the policy. Except as it expressly states, it does not (i) modify any of the terms and provisions of the policy, (ii) modify any prior endorsements, (iii) extend the Date of Policy, or (iv) increase the Amount of Insurance. To the extent a provision of the policy or a previous endorsement is inconsistent with an express provision of this endorsement, this endorsement controls. Otherwise, this endorsement is subject to all of the terms and provisions of the policy and of any prior endorsements.

Date:

Form 50-10045 (7-1-14)

Page 10 of 17

ALTA 17-06 Access and Entry (6-17-06)

A-1-D2-10


Table of Contents

Form No. 1402.06

ALTA Owner’s Policy (6-17-06)

Policy Page 11
Policy Number:

SINGLE TAX PARCEL
ENDORSEMENT

Issued by

First American Title Insurance Company

Attached to Policy No.:

File No.: NCS-960539-CHI2

The Company insures against loss or damage sustained by the Insured by reason of the Land being taxed as part of a larger parcel of land or failing to constitute a separate tax parcel for real estate taxes.

This endorsement is issued as part of the policy. Except as it expressly states, it does not (i) modify any of the terms and provisions of the policy, (ii) modify any prior endorsements, (iii) extend the Date of Policy, or (iv) increase the Amount of Insurance. To the extent a provision of the policy or a previous endorsement is inconsistent with an express provision of this endorsement, this endorsement controls. Otherwise, this endorsement is subject to all of the terms and provisions of the policy and of any prior endorsements.

Date:

Form 50-10048 (7-1-14)

Page 11 of 17

ALTA 18-06 Single Tax Parcel (6-17-06)

A-1-D2-11


Table of Contents

Form No. 1402.06

ALTA Owner’s Policy (6-17-06)

Policy Page 12
Policy Number:

LOCATION ENDORSEMENT

Issued by

First American Title Insurance Company

Attached to Policy No.:

File No.: NCS-960539-CHI2

The Company insures against loss or damage sustained by the Insured by reason of the failure of a Building including drive-up portal known as 2825 Foxfield Road, St. Charles IL , to be located on the Land at Date of Policy.

This endorsement is issued as part of the policy. Except as it expressly states, it does not (i) modify any of the terms and provisions of the policy, (ii) modify any prior endorsements, (iii) extend the Date of Policy, or (iv) increase the Amount of Insurance. To the extent a provision of the policy or a previous endorsement is inconsistent with an express provision of this endorsement, this endorsement controls. Otherwise, this endorsement is subject to all of the terms and provisions of the policy and of any prior endorsements.

Date:

Form 50-10054 (7-1-14)

Page 12 of 17

ALTA 22-06 Location (6-17-06)

A-1-D2-12


Table of Contents

Form No. 1402.06

ALTA Owner’s Policy (6-17-06)

Policy Page 13
Policy Number:

SAME AS SURVEY ENDORSEMENT

Issued by

First American Title Insurance Company

Attached to Policy No.:

File No.: NCS-960539-CHI2

The Company insures against loss or damage sustained by the Insured by reason of the failure of the Land as described in Schedule A to be the same as that identified on the survey made by Doland Engineering, LLC dated May 16, 2019, last revised May 31, 2019, and designated Job No. .

This endorsement is issued as part of the policy. Except as it expressly states, it does not (i) modify any of the terms and provisions of the policy, (ii) modify any prior endorsements, (iii) extend the Date of Policy, or (iv) increase the Amount of Insurance. To the extent a provision of the policy or a previous endorsement is inconsistent with an express provision of this endorsement, this endorsement controls. Otherwise, this endorsement is subject to all of the terms and provisions of the policy and of any prior endorsements.

Date:

Form 50-10059 (7-1-14)

Page 13 of 17

ALTA 25-06 Same as Survey (10-16-08)
CLTA 116.1-06 (10-16-08)

A-1-D2-13


Table of Contents

Form No. 1402.06

ALTA Owner’s Policy (6-17-06)

Policy Page 14
Policy Number:

ENCROACHMENTS - BOUNDARIES AND EASEMENTS ENDORSEMENT

Issued by

First American Title Insurance Company

Attached to Policy No.:

File No.: NCS-960539-CHI2

1.              The insurance provided by this endorsement is subject to the exclusions in Section 4 of this endorsement; and the Exclusions from Coverage, the Exceptions from Coverage contained in Schedule B, and the Conditions in the policy.

2.              For purposes of this endorsement only, “Improvement” means an existing building, located on either the Land or adjoining land at Date of Policy and that by law constitutes real property.

3.              The Company insures against loss or damage sustained by the Insured by reason of:

a.              An encroachment of any Improvement located on the Land onto adjoining land or onto that portion of the Land subject to an easement, unless an exception in Schedule B of the policy identifies the encroachment;

b.              An encroachment of any Improvement located on adjoining land onto the Land at Date of Policy, unless an exception in Schedule B of the policy identifies the encroachment;

c.               Enforced removal of any Improvement located on the Land as a result of an encroachment by the Improvement onto any portion of the Land subject to any easement, in the event that the owners of the easement shall, for the purpose of exercising the right of use or maintenance of the easement, compel removal or relocation of the encroaching Improvement; or

d.              Enforced removal of any Improvement located on the Land that encroaches onto adjoining land.

4.              This endorsement does not insure against loss or damage (and the Company will not pay costs, attorneys’ fees, or expenses) resulting from the encroachments listed as Exceptions NONE of Schedule B.

This endorsement is issued as part of the policy. Except as it expressly states, it does not (i) modify any of the terms and provisions of the policy, (ii) modify any prior endorsements, (iii) extend the Date of Policy, or (iv) increase the Amount of Insurance. To the extent a provision of the policy or a previous

A-1-D2-14


Table of Contents

Form No. 1402.06

ALTA Owner’s Policy (6-17-06)

Policy Page 15
Policy Number:

endorsement is inconsistent with an express provision of this endorsement, this endorsement controls. Otherwise, this endorsement is subject to all of the terms and provisions of the policy and of any prior endorsements.

Date:

Form 50-10808 (7-1-14)

Page 15 of 17

ALTA 28.1-06 - Encroachments - Boundaries and Easements (4-2-12)

A-1-D2-15


Table of Contents

Form No. 1402.06

ALTA Owner’s Policy (6-17-06)

Policy Page 16
Policy Number:

POLICY AUTHENTICATION ENDORSEMENT

Issued by

First American Title Insurance Company

Attached to Policy No.:

File No.: NCS-960539-CHI2

When the policy is issued by the Company with a policy number and Date of Policy, the Company will not deny liability under the policy or any endorsements issued with the policy solely on the grounds that the policy or endorsements were issued electronically or lack signatures in accordance with the Conditions.

This endorsement is issued as part of the policy. Except as it expressly states, it does not (i) modify any of the terms and provisions of the policy, (ii) modify any prior endorsements, (iii) extend the Date of Policy, or (iv) increase the Amount of Insurance. To the extent a provision of the policy or a previous endorsement is inconsistent with an express provision of this endorsement, this endorsement controls. Otherwise, this endorsement is subject to all of the terms and provisions of the policy and of any prior endorsements.

Date:

Form 50-10899 (7-1-14)

Page 16 of 17

ALTA 39.0-06 Policy Authentication (4-2-13)

A-1-D2-16


Table of Contents

Form No. 1402.06

ALTA Owner’s Policy (6-17-06)

Policy Page 17
Policy Number:

Privacy Information

We Are Committed to Safeguarding Customer Information

In order to better serve your needs now and in the future, we may ask you to provide us with certain information. We understand that you may be concerned about what we will do with such information - particularly any personal or financial information. We agree that you have a right to know how we will utilize the personal information you provide to us. Therefore, together with our subsidiaries we have adopted this Privacy Policy to govern the use and handling of your personal information.

Applicability

This Privacy Policy governs our use of the information that you provide to us. It does not govern the manner in which we may use information we have obtained from any other source, such as information obtained from a public record or from another person or entity. First American has also adopted broader guidelines that govern our use of personal information regardless of its source. First American calls these guidelines its Fair Information Values.

Types of Information

Depending upon which of our services you are utilizing, the types of nonpublic personal information that we may collect include:

·                       Information we receive from you on applications, forms and in other communications to us, whether in writing, in person, by telephone or any other means;

·                       Information about your transactions with us, our affiliated companies, or others; and

·                       Information we receive from a consumer reporting agency.

Use of Information

We request information from you for our own legitimate business purposes and not for the benefit of any nonaffiliated party. Therefore, we will not release your information to nonaffiliated parties except: (1) as necessary for us to provide the product or service you have requested of us; or (2) as permitted by law. We may, however, store such information indefinitely, including the period after which any customer relationship has ceased. Such information may be used for any internal purpose, such as quality control efforts or customer analysis. We may also provide all of the types of nonpublic personal information listed above to one or more of our affiliated companies. Such affiliated companies include financial service providers, such as title insurers, property and casualty insurers, and trust and investment advisory companies, or companies involved in real estate services, such as appraisal companies, home warranty companies and escrow companies. Furthermore, we may also provide all the information we collect, as described above, to companies that perform marketing services on our behalf, on behalf of our affiliated companies or to other financial institutions with whom we or our affiliated companies have joint marketing agreements.

Former Customers

Even if you are no longer our customer, our Privacy Policy will continue to apply to you.

Confidentiality and Security

We will use our best efforts to ensure that no unauthorized parties have access to any of your information. We restrict access to nonpublic personal information about you to those individuals and entities who need to know that information to provide products or services to you. We will use our best efforts to train and oversee our employees and agents to ensure that your information will be handled responsibly and in accordance with this Privacy Policy and First American’s Fair Information Values. We currently maintain physical, electronic, and procedural safeguards that comply with federal regulations to guard your nonpublic personal information.

Information Obtained Through Our Web Site

First American Financial Corporation is sensitive to privacy issues on the Internet. We believe it is important you know how we treat the information about you we receive on the Internet.

In general, you can visit First American or its affiliates’ Web sites on the World Wide Web without telling us who you are or revealing any information about yourself. Our Web servers collect the domain names, not the e-mail addresses, of visitors. This information is aggregated to measure the number of visits, average time spent on the site, pages viewed and similar information. First American uses this information to measure the use of our site and to develop ideas to improve the content of our site.

There are times, however, when we may need information from you, such as your name and email address. When information is needed, we will use our best efforts to let you know at the time of collection how we will use the personal information. Usually, the personal information we collect is used only by us to respond to your inquiry, process an order or allow you to access specific account/profile information. If you choose to share any personal information with us, we will only use it in accordance with the policies outlined above.

Business Relationships

First American Financial Corporation’s site and its affiliates’ sites may contain links to other Web sites. While we try to link only to sites that share our high standards and respect for privacy, we are not responsible for the content or the privacy practices employed by other sites.

Cookies

Some of First American’s Web sites may make use of “cookie” technology to measure site activity and to customize information to your personal tastes. A cookie is an element of data that a Web site can send to your browser, which may then store the cookie on your hard drive.

FirstAm.com uses stored cookies. The goal of this technology is to better serve you when visiting our site, save you time when you are here and to provide you with a more meaningful and productive Web site experience.

Fair Information Values

Fairness We consider consumer expectations about their privacy in all our businesses. We only offer products and services that assure a favorable balance between consumer benefits and consumer privacy.

Public Record We believe that an open public record creates significant value for society, enhances consumer choice and creates consumer opportunity. We actively support an open public record and emphasize its importance and contribution to our economy.

Use We believe we should behave responsibly when we use information about a consumer in our business. We will obey the laws governing the collection, use and dissemination of data.

Accuracy We will take reasonable steps to help assure the accuracy of the data we collect, use and disseminate. Where possible, we will take reasonable steps to correct inaccurate information. When, as with the public record, we cannot correct inaccurate information, we will take all reasonable steps to assist consumers in identifying the source of the erroneous data so that the consumer can secure the required corrections.

Education We endeavor to educate the users of our products and services, our employees and others in our industry about the importance of consumer privacy. We will instruct our employees on our fair information values and on the responsible collection and use of data. We will encourage others in our industry to collect and use information in a responsible manner.

Security We will maintain appropriate facilities and systems to protect against unauthorized access to and corruption of the data we maintain.

Form 50-PRIVACY (9/1/10)

Page 1 of 1

Privacy Information (2001-2010 First American Financial Corporation)

A-1-D2-17


Exhibit E-1 Survey for First Street Property See Attached.

GRAPHIC

A-1-E1-1

I ' ( ALTA/NSP$ LAND TITLE SURVEY -OF-THAT PART OF LOT 16 IN BROWNSTONE, A SUBD!V5!0N IN lHE CITY OF ST. CHARLES, WEST SIDE or THE FOX RIVER, BEING A SUBDMSION IN THE NORTiii\'EST QUARTER OF" SfCTKJN 34, TO\\'NSHIP 40 NORTH, RANGE B EAST or THE THIRD PRINCIPAL l.iERID!AN BOUNDED AND DESCRIBED AS FOLLOWS: CDI.!MEN.CIN.G AT THE SOUTHWESTERLY CORNER OF SAID LOT 16; THENCE NORTH 78 DEGREES 44 l,llt>WTES 33 SECONDS EAST BEING AN ASSUMED BEARING ON THE SOUTHERLY LINE OF SAID LOT 16, THE SAME AS THE NORTHERLY LINE OF COBBLESTONE DRIVE, 2.0 FEEf; THENCE NOR1H II DEGREES 15 MINUTES 27 SECONDS WEST, 17.66 FEET; THENCE NORTH 78 DEGREES 44 'Mil·lUTES 33 SECONDS EAST, 11.42 FEET TO THE iNlERIOR \\'ALL OF FIRST FLOOR CO!JI.!ERCW. UNIT "D" FOR THE POINT OF BEGINNING; THENCE NOR1H 11 DEGREES 15 l.iiNUTES 27 SECONDS '{jEST ALONG SAID INTERIOR WALLS 40.07 FEET; THENCE NORTH 78 DEGREES 44 MINUTES 33 SECONDS EAST, 27..28 FEET; THENCE NOR1H 11 DEGREES 15 MINUTES 27 SECONDS \\'tST, 11.33 FEET; THENCE SOUTH 78 DEGREES 44 l.l1NUTES 33 SECONDS WEST, 27.28 FEET; THENCE NORTH II DEGREES 15 MINUTES 27 SECONDS \\'EST, 51.81 FEET: THENCE NORTH 78 DEGREES 44 MINUTES 33 SECONDS EAST, 57.6-4 FEET; II DEGREES 15 l.liNUTES 27 SECONDS EAST, 12.66 FEET: THENCE SOUTH 78 DEGREES 44 l.iiNUTES 33 SECONDS WEST 3,33 FEET: THENCE SOUTH II DEGREES 15 l,liNUTES 7 SECONDS EAST, 18.83 FEET: THENCE NORTH 78 DEGREES 44 l.iiNUTES 33 SECONDS EAST, 3.33 FEET; THENCE SOUTH 11 DEGREES 15 l.iiNUTES 27 SECONDS EAST, 15.32 EET: THENCE SOUTH 78 DEGREES 44 MINUTES 33 SECONDS \\'£ST. 9.91 FEET: THENCE NORTH II DEGREES 15 MINUTES 27 SECONDS WEST. 2.0 FEET; THENCE SOUTH 78 D£ REES 44 MINUTES 33 SECONDS \\'tST, 6.30 FEET; THENCE SOUTH 11 DEGREES 15 MINUTES 27 SECONDS EAST, 12.54 FEET; THENCE SOUTH 78 DEGREES 44 MINUTES 33 SECONDS WEST, 3.91 FEET; THENCE SOUTH 11 DEGREES 15 MINUTES 27 SECONDS EAST, 5.6B FEET: THENCE NORTH 78 DEGREES 44 l.iiNUTES 33 SECONDS EAST, 4.5B F ET; THENCE NOOTH 11 DEGREES 15 MINUTES 27 SECONDS WEST, 1.29 FEET: THENCE NORTH 78 DEGREES 44 l.iiNUTES 33 SECONDS EAST, 8.33 FEET; THENCE SOUTH 11 D GREES 15 I,!INUTES 27 SECONDS EAST, 6.50 FEET; THENCE NORTH 78 DEGREES 44 MINUTES 33 SECONDS EAST, 7.41 FEET; THENCE SOUTH SOUTH 1l DEGREES 15 MINU S 27 SECONDS EAST, 15.33 FEET; THENCE SOUTH 78 DEGREES 44 !JINUTES 33 27.28' S76"«'J3"l\' SfCONDS WEST, 3,33 FEET; THENCE SOUTH SOUTH 11 DEGREES 15 MINUTES 27 SEC OS EAST, 19.75 FEET: THENCE SOUTH 33 DEGREES 44 MINUTES 33 SECONDS \\'tST 11.89 FEET; THENCE SOUTH 78 DEGREES 44 l.iiNUTES 33 SECONDS WEST, 6.25 FEET; HENCE SOUTH SOUTH 11 DEGREES 15 MINUTES 27 SECONDS EAST, 3.33 FEET: THENCE SOUTH 78 DtGREES 44 MINUTES 33 SECONDS V/EST, 24.99 FEET; THENCE NORTH 11 EGREES 15 l.iiNUTES 27 SECONDS WEST, 3.33 FEET: THENCE SOUTH 7B DEGREES 44 MINUTES 33 SECONDS WEST, 6.25 FEET; THENCE NORTH 56 D£GREES 15 l.liNUTES 27 SECONDS WEST, 11.89 FEET: TO THE POINT Of BEGINNING, ALL IN KANE COUNTY, IlliNOIS, TAKEN J.S A SINGLE TRACT OF WID EXCEPT THAT PARl LYING ABOVE A HOR ONTAL PlANE HAVlNG A LOWER ELEVATIQ,I.j OF 702.69 FEET MEASURED ON SAID COMI.iERCw_ UNIT it CE!UNG AND LYING BELOW A HORIZONlAL PLANE HAVING AN UP ER ELEVATION Of 691.02 FEET MEASURED ON SAID COMMERCW. UNIT .D. flOOR; SAID ELEVATIONS REFERENCED TO N.G.V.D. 29 DATUI.i FOR FE\J.A BENCH\JARK 266-4 IN COUNTY, ILLINOIS. STAIR\\'El.L li76'«'JJ"E 27.28' ' \ SURVEY NOTES 1) PINI09-34-137-006 c{ ,..<.D._ \ ) UNIT D 2} ACCORDING TO f.E.M.A. MAP COMMUN11Y PANEL NUMBER 17089C0262H DATED 08/03/09. THIS PROPERTY LIES IN A "ZONE X" (AREAS DETERMINED TO BE OUTSIDE THE 0.2% ANNUAL CHANCE FLOODPLA.!N). 3) DUE TO THE BUILDING BEING AN ACTIV£ BANKING FACILI1Y, INTERIOR BUILDING MEASUREMENTS V£RIFICATlONS WERE NOT AVAILABLE. TO: STC BANCSHARES, CORP., AN IlliNOIS CORPORATION i\'lt·HRUST FINANCIAL CORPORATION FIRST AMERICAN TITLE INSURANCE COMPANY MdT Iol<.-A t+tws I, 2-, .+. t .(... , "'7Cc:), 6, "• r3 , t<t, l1, THIS IS TO CERTIFY THAT THIS MAD OR PI.AT AND THE SURVEY ON WHICH IT IS BASED WERE JADE IN ACCORDANCE WITH THE""> 2016 MINIMUM STANDARD DETL REQUIREMENTS fOR ALTA/NSPS LAND TITLE SURVEYS, JOINTLY ESTABLISHED AND ADoPTED BY . U _ <-0 f.>"' C.-(!.Y Ut::::tlo:::::'"VI - DR!V E fa"",( \N\;I.Q..\"e,. IIP"k-ftll,& ilof.Mif.1 $ $lV\t\. {Q S\J(\1 .f.)../ 11111 11 \\\11° ..... AlTA AND NSPS. THE FIELD WORK WAS coMPLETED ON MAY 16 2D19. DATE: MAY 17, 2019 '" ''' .ii!?;':.fi,!!Q . J546·<:) J-----' 4WiNJjJIW I> \ IJ IC0BBLE$TbNE THE FOLLOWING SCHEDULE B PART !I TITLE EXCEPTIONS ARE RortSsmu -. ; FIRST AMERICAN TITLE INSURANCE COMPANY ORDER NO. NCS-9605451-CHI2, DATED MAY 9, 2019 ;1* j suv. o: REV.: \.JAY 31, 2019 1) NOT A SURVEY \MTIER lV··.:: ....-'Jil ; 4) 5) 6) 7) 8) : 1 \'•ov,J.e. -to swvV-_o,. t>.Vl o\ •<ko.rs "'-I'P""P"'Mel r I,. ·;:,'E; \\.\. . DOLAND ENGINEERING, LLC -C!Vl!J ENmNEBRINO - ND SURVEYING .. LAND PI.ANNIN0-334 E. COLPAX STREET, SUITE C, PALATINE, ILLINOIS 60067 CONDOMINIUM DOCUMENTATION - NOT PROVIDED TO SURVEYOR NOT A SURVEY MATIER DOES NOT AFFECT AREA WITHIN SURVEY LEGAL DESCRIPTION BOUNDARY NOT A SURVEY MATTER NOT A SURVEY MAnER 11mnrnrtl" ILLINOIS PROFESSIONAL lAND SURVEYOR 63546 (847) 991-6068 (847) 934-5427-FAX I _j

GRAPHIC

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Exhibit E-2 Survey for Foxfield Property See Attached.

GRAPHIC

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r ALTA/N$P$ LAND TITLE SURVEY -OF­ ',7,';" = ,'.; . < a = 21,200!,=.olotlo:>:r.t.<l ...,... ·-«==ruo"""""'·"""""u"<>!> ,;t ;; SURVEY NOTES I) """>'(Off om. <1'"' !.On. • '-"• KPtS ;1)1'1</"'·1)-l'l·""' ;1 '"; '%t=o = •)"""""'"tcf<W6PSl......, """""""'''""""""""" : - IT£1./S COOR£SPON!rnG TO SMOUL£ B, PAAT TWO: --rnu:.".:'IJ..:o...'. :' wllh"o :mo. / LOT2 I' A.Ac.l Tttb \e. A lh.WIS I, 2, 3I'\ I f.C"\ 1(.,..')I ' : 1( >'>(,), 7(c.), e, ..,, 11, -,....._,:r M.C "'.... 1'+, '"· 11 AY>J.. 2-o w .v-e m1 Stk , 13, 'IDXJ """"'"""' tb e ce.<-hhe >.:no"'i fl> -li,e,-SVY"vll.'f ' o..l!>.,\ '' 1 '' ' JOWITJYl>i<!""\II;>"'"JoJ""'"""-"""""Ii'ICin5"""'i<>lr.t.::l;f! t1"'!1l a"'"""'IV<"'"'"-'...,.,.......,"'II""'"""-""""'13t'll1MD""'""""""' """"'"""' h<rc.Dio:A<t¥; <0< 1:.,10\L llfY'"''''·"'" DOLAND ENGINEERING, LLC -crt>. ·LIJill!l.'!l'lmM•!Ml>ru.'lltw;­ ..... C<>IJ".. """""'·"C'ITGI!, PAUnl<I:.IUm013"""'" (<I<>) ..,•....,. ("'1) ..........."." ------- ---,... '"" "'""'""ocu ..,., ll>:f 1(20,

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Exhibit F

Form of Opinion of Company Counsel

The opinion of Company counsel to be delivered in accordance with Section 6.6 of the Merger Agreement will include the matters set forth below.  In rendering its opinion, Company counsel may rely as to matters of fact upon certificates of the officers of the Company, stock records of the Company, certificates of federal and state governmental officials and agencies, the representations and warranties set forth in the Merger Agreement, and other sources as such counsel deems appropriate.  Capitalized terms used herein that are not defined herein shall have the meanings ascribed to such terms in the Merger Agreement.

(a)                                 The Company is duly registered as a bank holding company under the Bank Holding Company Act of 1956, as amended, and is a corporation incorporated under the laws of, and in good standing in, the State of Illinois.  The Bank is a bank chartered under the laws of the State of Illinois and has authority to conduct general banking business as provided by the Illinois Banking Act and as permitted by its charter.

(b)                                 The authorized capital stock of the Company consists of 2,000,000 shares of Company Common Stock, $0.01 par value per share.  To our knowledge, based solely on certificates of officers of the Company, immediately prior to the Effective Time, there are [      ] shares of Company Common Stock issued and outstanding.  To our knowledge, the issued and outstanding shares of the Company Common Stock have been duly and validly authorized and issued and are fully paid and non-assessable.  None of the shares of Company Common Stock are subject to any preferences, qualifications, limitations, restrictions or special or relative rights under the Company’s articles of incorporation.  To our knowledge, there are no options, agreements, contracts or other rights in existence to purchase or acquire from the Company any shares of capital stock of the Company, whether now or hereafter authorized or issued, except for options to purchase [      ] shares of Company Common Stock.

(c)                                  The authorized capital stock of the Bank consists of 300,000 shares of common stock, $1.00 par value per share.  To our knowledge, based solely on certificates of officers of the Bank, 300,000 shares of common stock of the Bank are issued and outstanding.

(d)                                 The Bank owns 100% of the equity interests of the Bank Subsidiary.  To our knowledge, there are no options, agreements, contracts, or other rights in existence to purchase or acquire additional equity interests from the Bank Subsidiary or any membership units of the Bank Subsidiary, whether now or hereafter authorized or issued.

(e)                                  The Company has the corporate power and authority to execute, deliver and perform its obligations under the Merger Agreement, the execution, delivery and performance thereof by the Company have been duly and validly authorized by all necessary corporate action on the part of the Company, and the Merger Agreement has been duly executed and delivered by the Company.

(f)                                   The Merger Agreement constitutes the legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors generally and to general principles of equity.

(g)                                  The execution and delivery by the Company of the Merger Agreement do not, and the performance by the Company of its obligations under the Merger Agreement will not, (i) constitute a violation by the Company of its articles of incorporation or by-laws or by the Bank of its charter, (ii) constitute a violation by the Company or the Bank of any statutory law, rule or regulation applicable

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to the Company or the Bank, (iii) constitute a violation by the Company or the Bank of any judgment, injunction, order or decree to which the Company or the Bank is subject that is listed on the Officer’s Certificate of the Company attached to this opinion letter, or (iv) constitute a breach or a default by the Company or the Bank under any note, bond, mortgage, indenture, instrument, or agreement listed on the Officer’s Certificate of the Company attached to this opinion letter.

(h)                                 Neither the execution and delivery by the Company of the Merger Agreement, nor the performance by the Company of its obligations under the Merger Agreement, requires the Company to obtain any consent or approval from, or make any filing with any Governmental Authority of the State of Illinois or the United States of America under any statutory law, rule or regulation applicable to the Company, except as have been obtained or made pursuant to the Merger Agreement.

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Exhibit H

Form of Opinion of Wintrust Counsel

The opinion of Wintrust counsel to be delivered in accordance with Section 7.6 of the Merger Agreement will include the matters set forth below.  In rendering its opinion, Wintrust counsel may rely as to matters of fact upon certificates of the officers of Wintrust, stock records of Wintrust and its Subsidiaries, and certificates of federal and state governmental officials and agencies, the representations and warranties set forth in the Merger Agreement, and other sources as such counsel deems appropriate.  Capitalized terms used herein that are not defined herein shall have the meanings ascribed to such terms in the Merger Agreement.

(a)                                 Wintrust is duly registered as a financial holding company under the Bank Holding Company Act of 1956, as amended, and is a corporation validly existing and in good standing under the laws of the State of Illinois.

(b)                                 Wintrust has the corporate power and authority to execute, deliver and perform its obligations under the Merger Agreement, the execution, delivery and performance thereof by Wintrust have been duly and validly authorized by all necessary corporate action on the part of Wintrust, and the Merger Agreement has been duly executed and delivered by Wintrust.

(c)                                  Merger Co. is a limited liability company validly existing and in good standing under the laws of the State of Illinois.

(d)                                 Merger Co. has the limited liability company power and authority to execute, deliver and perform its obligations under the Merger Agreement, the execution, delivery and performance thereof by Merger Co. have been duly and validly authorized by all necessary limited liability company action on the part of Merger Co, and the Merger Agreement has been duly executed and delivered by Merger Co.

(e)                                  The Merger Agreement constitutes the legal, valid and binding obligations of Wintrust and Merger Co., enforceable against Wintrust and Merger Co. in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors generally and to general principles of equity.

(f)                                   The execution and delivery by Wintrust and Merger Co. of the Merger Agreement do not, and the performance by Wintrust and Merger Co. of their respective obligations under the Merger Agreement will not, (i) constitute a violation by Wintrust of its articles of incorporation or by-laws or by Merger Co. of its articles of organization or operating agreement, (ii) constitute a violation by Wintrust or Merger Co. of any statutory law, rule or regulation applicable to Wintrust or Merger Co., (iii) constitute a violation by Wintrust or Merger Co. of any judgment, injunction, order or decree to which Wintrust or Merger Co. is subject that is listed on the Officer’s Certificate of Wintrust attached to this opinion letter, or (iv) constitute a breach or a default by Wintrust or Merger. Co. under any note, bond, mortgage, indenture, instrument, or agreement that is filed as an Exhibit to Wintrust’s latest Annual Report on Form 10-K for the year ended 2018 or to any subsequent Quarterly Report on Form 10-Q or otherwise listed on the Officer’s Certificate of Wintrust attached to this opinion letter.

(g)                                  Neither the execution and delivery by Wintrust or Merger Co. of the Merger Agreement, nor the performance by Wintrust or Merger Co. of their obligations under the Merger Agreement, requires Wintrust or Merger Co. to obtain any consent or approval from or make any filing or registration with any Governmental Authority of the State of Illinois or the United States of America under any statutory law,

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rule or regulation applicable to Wintrust or Merger Co., except as have been obtained or made pursuant to the Merger Agreement.

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Annex A-2

AMENDMENT TO AGREEMENT AND PLAN OF MERGER

This AMENDMENT TO AGREEMENT AND PLAN OF MERGER (this “Amendment”) is entered into as of the 1st day of July, 2019, by and between WINTRUST FINANCIAL CORPORATION, an Illinois corporation (“Wintrust”), WTFC STCBC Merger Sub LLC, an Illinois limited liability company and wholly owned subsidiary of Wintrust (“Merger Co.”), and STC BANCSHARES CORP., an Illinois corporation (the “Company”).  Wintrust, Merger Co. and the Company are each referred to in this Agreement as a “Party” and collectively in this Agreement as the “Parties.”

RECITALS

A.                                    Wintrust, Merger Co. and the Company entered into an Agreement and Plan of Merger dated June 5, 2019 (the “Agreement”), whereby the Company will merge with and into Merger Co. in accordance with the terms and subject to the conditions set forth in the Agreement.

B.                                    Pursuant to Section 9.9 of the Agreement, Wintrust, Merger Co. and the Company desire to amend certain limited terms of the Agreement as set forth in this Amendment.

AGREEMENTS

NOW, THEREFORE, in consideration of the recitals and the mutual representations, covenants and agreements hereinafter set forth, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Wintrust, Merger Co. and the Company hereby agree as follows:

Section 1.                                          Section 1.10(b) of the Agreement, clause (i), shall be amended to state in its entirety as follows: “(i) the obligations of the Company’s shareholders to indemnify Shareholders’ Representative, including the reimbursement of expenses, for claims relating to actions taken under this Agreement, the Escrow Agreement and the Reserve Agreement, and”.

Section 2.                                          Section 1.10(b) of the Agreement, clause (ii), shall be amended by replacing “the expenses of Shareholders’ Representative” with “the expenses of the to-be-formed limited liability company controlled by the Shareholders’ Representative for the benefit of the Company’s shareholders (the “Litigation Entity”)”.

Section 3.                                          Section 7.10 of the Agreement shall be deleted in its entirety and replaced with the following:

Assignment Agreement.  The Bank, the Litigation Entity, Merger Sub and Wintrust shall have executed and delivered that certain Assignment Agreement in the form substantially similar to Exhibit I (the “Assignment Agreement”) and reasonably satisfactory to the Company and Wintrust, to assign to the Litigation Entity all rights, interests, insurance claims and any recoveries thereon, judgments, and amounts received in settlement, and for the Litigation Entity to assume all liabilities and other obligations related to the Customer Litigation.”

Section 4.Exhibit C to the Agreement shall be deleted in its entirety and replaced with the attached Exhibit C.

Section 5.Exhibit I to the Agreement shall be deleted in its entirety and replaced with the attached Exhibit I.

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Section 6.                                          All capitalized terms set forth in this Amendment shall have the meanings ascribed to them in the Agreement unless defined otherwise in this Amendment.

Section 7.                                          This Amendment has been duly and validly authorized, approved, executed and delivered by each of the parties and constitutes a valid and binding agreement of such parties, enforceable against each of them in accordance with its terms.

Section 8.                                          Except as expressly amended by this Amendment, all other terms and provisions set forth in the Agreement remains in full force and effect.  The Agreement, as modified by this Amendment, and the documents to be delivered under the terms of the Agreement and this Amendment, constitute the entire agreement of the Parties with respect to the subject matter hereof and supersedes and renders null and void all other discussion, negotiations and other understandings with respect to such subject matter.

Section 9.                                          This Amendment may be executed in counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.  This Amendment may be executed and accepted by portable document format (PDF) signature and any such signature shall be of the same force and effect as an original signature.

[This space intentionally left blank; signature page follows.]

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IN WITNESS WHEREOF, the Parties hereto duly executed this Amendment as of the date first above written.

WINTRUST FINANCIAL CORPORATION

By:

/s/ David A. Dykstra

Name:

David A. Dykstra

Title:

Senior EVP & COO

STC BANCSHARES CORP.

By:

/s/ Christopher Woelffer

Name:

Christopher Woelffer

Title:

President

WTFC STCBC MERGER SUB LLC

By:

/s/ David A. Dykstra

Name:

David A. Dykstra

Title:

Senior EVP

[Signature Page to Amendment to Agreement and Plan of Merger]

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Exhibit C

Form of Reserve Agreement

This Reserve Agreement (“Reserve Agreement”) is made and entered into as of [    ], 2019 (the “Effective Date”) by and among Anthony V. Sisto, not personally but as the exclusive agent (including any successors thereof, the “Shareholders’ Representative”) of the shareholders of STC Bancshares Corp., an Illinois corporation (the “Company”),          , a          limited liability company (the “Litigation Entity”), and The Chicago Trust Company, N.A., a national association (the “Escrow Agent”).

RECITALS

WHEREAS, Wintrust Financial Corporation, an Illinois corporation (“Wintrust”), WTFC STCBC Merger Sub, LLC, an Illinois limited liability company and wholly owned subsidiary of Wintrust (“Merger Sub”), and the Company are parties to that certain Agreement and Plan of Merger, dated as of June 5, 2019, as amended July 1, 2019 (the “Merger Agreement”), a copy of which is attached hereto as Exhibit A.  The Merger Agreement provides for, among other things, the merger of the Company with and into Merger Sub, whereupon the separate existence of the Company shall cease.  Capitalized terms used but not otherwise defined in this Reserve Agreement have the meanings given to them in the Merger Agreement.

WHEREAS, Sections 1.4 and 1.10(b) of the Merger Agreement provide that at Closing, Wintrust shall deposit a portion of the Merger Consideration in cash in the amount of $400,000 into an escrow account for the purposes of funding (i) the obligations of the Company’s shareholders to indemnify the Shareholders’ Representative, including the reimbursement of expenses, under the Merger Agreement, the Escrow Agreement, and the Reserve Agreement, and (ii) the expenses of the Litigation Entity in connection with pursuing, litigating, settling, indemnifying the Indemnified Parties (such term as used herein as defined in the Assignment Agreement) and taking of any other actions relating to the Customer Litigation.  Such Reserve Amount shall be held pursuant to this Reserve Agreement until such time as it may be released in accordance with the terms hereunder pro rata to the shareholders of the Company as a portion of the Per Share Escrowed Consideration.

WHEREAS, Anthony V. Sisto was appointed Shareholders’ Representative by all necessary corporate and shareholder action of the Company at the Shareholders’ Meeting held pursuant to the Merger Agreement on [    ], 2019.  Such appointment included (i) authorization to act on behalf of all holders of Company Common Stock Outstanding (the “Shareholders”), as sole manager of the Litigation Entity, in connection with pursuing, litigating, settling, indemnifying the Indemnified Parties and taking of any other actions relating to the Customer Litigation, and (ii) indemnification of the Shareholders’ Representative by the Shareholders with respect to any actions that may be taken by the Shareholders’ Representative pursuant to this Reserve Agreement or the Escrow Agreement on behalf of all of the Shareholders.

WHEREAS, the Litigation Entity is a limited liability company managed by the Shareholders’ Representative formed for the benefit of the Company’s shareholders.

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AGREEMENT

NOW, THEREFORE, in consideration of the mutual covenants, agreements, representations and warranties herein contained, the parties agree as follows:

1.Establishment of Reserve Account.

1.1Appointment of Escrow Agent; Deposit of Funds.  The Shareholders’ Representative and the Litigation Entity hereby appoint the Escrow Agent to act in accordance with the express terms and provisions of this Reserve Agreement, and the Escrow Agent hereby accepts such appointment on the express terms and provisions of this Reserve Agreement.  At Closing, the Merger Agreement requires that Wintrust deposit or cause to be deposited with the Escrow Agent on behalf of the Shareholders $400,000 in immediately available funds (such amount is referred to hereafter as the “Reserve Amount”).

1.2Power to Transfer Escrow.  The Escrow Agent is hereby granted the power and is directed to effect any transfer of any portion of the Reserve Amount as provided for in this Reserve Agreement.

1.3Establishment of Reserve Account; Non-Interest Bearing.

(a)                                 As of the Effective Date, the Escrow Agent shall deposit the Reserve Amount into an escrow account (the “Reserve Account”), which shall be a non-interest bearing account.  The Escrow Agent hereby agrees to maintain and disburse funds held in the Reserve Account as provided in this Reserve Agreement, which account shall be held and maintained in a manner consistent with Escrow Agent’s other non-interest bearing accounts.  The Escrow Agent shall hold and safeguard the Reserve Amount and the Reserve Account during the term of this Reserve Agreement, shall treat the Reserve Amount in accordance with the terms of this Reserve Agreement and not as the property of the Shareholders’ Representative or the Litigation Entity, and shall hold and dispose of the Reserve Amount only in accordance with the express terms of this Reserve Agreement.

(b)                                 The Litigation Entity shall cause to be deposited in the Reserve Account all amounts received, from judgments, settlement, or otherwise, in connection with the Customer Litigation (the “Litigation Amount”).

2.Disbursement of Reserve Amount.  Within five (5) business days after the later of (x) the date that the Customer Litigation is resolved, through settlement, judgment or the Litigation Entity’s suspension of the pursuit of the Customer Litigation and (y) the Release Date under the Escrow Agreement (the “Release Date”), which date shall not be more than five (5) years from the commencement of the Customer Litigation, of which date Escrow Agent shall be notified in writing by the Shareholders’ Representative, the Escrow Agent shall distribute to the Exchange Agent, on behalf of the Shareholders, an amount equal to (a) the amount of the then-remaining Reserve Amount, plus (b) the amount of the then-remaining distribution from the Escrow Account to the Reserve Account pursuant to Section 6.3 of the Escrow Agreement, plus (c) the Litigation Amount, minus (d) the aggregate dollar amount of any claims pursuant to Section 5.3 below, which amounts not previously paid prior to the Release Date shall be paid to

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the Shareholders’ Representative promptly after the Release Date, minus (e) the aggregate dollar amount of any claims pursuant to Section 5.4 below, which amounts not previously paid prior to the Release Date shall be paid to the Litigation Entity promptly after the Release Date (such net amount, the “Reserve Disbursement”), by wire transfer in accordance with wire instructions provided by the Shareholders’ Representative to the Escrow Agent.  The Exchange Agent shall then promptly distribute the Reserve Disbursement to the Shareholders as a portion of the Per Share Escrowed Consideration, calculated by dividing the total Reserve Disbursement by the number of shares of Company Common Stock Outstanding immediately prior to the Effective Time.  Distributions to the Shareholders shall be made using the instructions previously provided by each Shareholder to the Exchange Agent in such Shareholder’s Letter of Transmittal delivered in accordance with the Merger Agreement, unless such delivery instructions are modified in writing in accordance with the terms of each such Letter of Transmittal.

3.Escrow Agent.

3.1Duties.  The duties of the Escrow Agent hereunder shall be entirely administrative and not discretionary.  The duties, responsibilities, and obligations of the Escrow Agent shall be limited to those expressly set forth herein and the Escrow Agent shall not have any responsibility as to the accuracy of, and shall incur no liability with respect to, any written notice, instruction, direction, request or other communication, statement, representation, warranty, agreement (including without limitation the Merger Agreement), or covenant made by any other party hereto (even if any reference thereto is made herein).  The Escrow Agent is not obligated to make any independent calculations under this Reserve Agreement.  The Escrow Agent shall be obligated to act only in accordance with written instructions received by it as provided in this Reserve Agreement and is authorized hereby to comply with any orders, judgments, or decrees of any court with or without jurisdiction or decision of any arbitrator and shall not be liable as a result of its compliance with the same.  The Escrow Agent will not be deemed to have knowledge of any event under this Reserve Agreement unless and until it receives written notice of such event.  None of the provisions of this Reserve Agreement shall require the Escrow Agent to use or advance its own funds in the performance of any of its duties hereunder, nor will the Escrow Agent be required to make any payments under this Reserve Agreement unless and until it will have received sufficient funds to make such payments.  The Escrow Agent may execute any of its powers and may perform any of its duties under this Reserve Agreement by or through attorneys, agents, or employees.  Notwithstanding anything herein to the contrary, the Escrow Agent is not responsible for nor assumed to have any knowledge of the contents of the Merger Agreement.

(a)                                 The Escrow Agent shall be fully protected in acting upon any written notice, instruction, direction, request or other communication, paper or document which the Escrow Agent believes to be genuine, and shall have no duty to inquire into or investigate the validity, accuracy or content of any thereof.

(b)                                 The Escrow Agent may engage or be interested in financial or other transactions with Wintrust or any party hereto or affiliate thereof, and may act on, or as depositary, trustee or agent for, any committee or body of holders of obligations of such party or affiliate, as freely as if it were not the Escrow Agent hereunder.

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(c)                                  The Escrow Agent shall not be responsible or liable for any failure or delay in the performance of its obligations under this Reserve Agreement arising out of or caused, directly or indirectly, by circumstances beyond its reasonable control, including, without limitation: acts of God; earthquakes; fire; flood; wars; acts of terrorism; civil or military disturbances; sabotage; epidemic; riots; interruptions, loss or malfunctions of utilities, computer (hardware or software) or communications services; accidents; labor disputes; acts of civil or military authority or governmental action; it being understood that the Escrow Agent shall use commercially reasonable efforts which are consistent with accepted practices in the banking industry to resume performance as soon as reasonably practicable under the circumstances.

3.2Legal Opinions.  As to any legal questions or other uncertainties arising in connection with the administration of this Reserve Agreement, the Escrow Agent may rely absolutely upon the written instruction of the Shareholders’ Representative or the Litigation Entity or the opinions or advice given to the Escrow Agent by its counsel (who may be an employee of the Escrow Agent and may also be counsel to one or more other parties to this Reserve Agreement) and shall be free of liability resulting from any delay due to waiting for, taking, suffering, or omitting to take any action in reliance upon such opinions or advice.

3.3Signatures.  The Escrow Agent may rely absolutely upon the genuineness and authorization of the signature and purported signature of any party upon any instruction, notice, release, receipt or other document delivered to it pursuant to this Reserve Agreement.

3.4Receipts and Releases.  In addition to the release requirements set forth above, the Escrow Agent may, as a condition to the disbursement of monies as provided herein, require from the payee or recipient a receipt therefor and, upon final payment, a release of the Escrow Agent from any liability arising out of its execution or performance of this Reserve Agreement, such release to be in a form reasonably satisfactory to the Escrow Agent.

3.5Refrain from Action.  In the event the Escrow Agent believes any ambiguity or uncertainty exists hereunder or in any notice, instruction, direction, request, or other communication, paper, or document received by the Escrow Agent hereunder, the Escrow Agent, may, in its sole discretion, refrain from taking any action, and shall be fully protected and shall not be liable in any way to the Shareholders’ Representative or the Litigation Entity or any other person or entity for refraining from taking such action, unless the Escrow Agent receives written instructions signed by the Shareholders’ Representative or the Litigation Entity that eliminates such ambiguity or uncertainty to the satisfaction of the Escrow Agent.

3.6Interpleader.  If any controversy arises with any third person, the Escrow Agent shall not be required to determine the same or to take any action, but the Escrow Agent in its discretion may institute such interpleader or other proceedings in connection therewith as the Escrow Agent may deem proper, and in following either course, the Escrow Agent shall not be liable.

4.Shareholders’ Representative and Litigation Entity.

4.1Expenses of Shareholders’ RepresentativeThe Shareholders’ Representative shall be entitled to reimbursement out of the Reserve Account for all reasonable out-of-pocket

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costs and expenses he may incur, if any, in performing the duties assigned to him by the Reserve Agreement.  The Shareholders’ Representative may consult with, and obtain advice from, third-party advisors, including legal counsel and financial advisors, and the Reserve Account shall be used to reimburse the Shareholders’ Representative for all reasonable expenses incurred in consulting with such advisors.

4.2Change to Initial Shareholders’ Representative.  If the initial Shareholders’ Representative, Anthony V. Sisto, should die or become unable or unwilling to perform his duties, and unable or unwilling to appoint a successor, then Keith Kotche shall be appointed as the successor Shareholders’ Representative, to serve in the same capacity as the prior Shareholders’ Representative.  If the Shareholders’ Representative or the successor thereto named in this Reserve Agreement should die or become unable or unwilling to perform his duties, and unable or unwilling to appoint a successor, then the Escrow Agent shall appoint any reasonable successor Shareholders’ Representative.  Any successor Shareholders’ Representative so appointed shall be vested with the same power and authority as the Shareholders’ Representative named in this Reserve Agreement.  The existing Shareholders’ Representative shall notify the Escrow Agent of any such change in the Shareholders’ Representative; provided, however, that if such notification is not possible, the successor Shareholders’ Representative shall notify the Escrow Agent of any such change.

4.3Litigation Entity.   The Litigation Entity shall be entitled to reimbursement out of the Reserve Account for all reasonable expenses incurred by the Litigation Entity (including third-party advisor fees) in pursuing, litigating, settling, indemnifying the Indemnified Parties and taking of any other actions relating to the Customer Litigation.

5.Indemnification.

5.1Waiver and Indemnification.  Each of the Shareholders’ Representative and Litigation Entity agrees to and hereby does waive any suit, claim, demand, or cause of action of any kind that it may have or may assert against the Escrow Agent and the Escrow Agent shall not be liable for any action taken, suffered, or omitted to be taken hereunder arising out of or relating to the execution, administration, or performance by the Escrow Agent of this Reserve Agreement, unless such suit, claim, demand, or cause of action is based upon the intentional misconduct or gross negligence of the Escrow Agent, each as determined by a final, non-appealable judgment of a court of competent jurisdiction; provided, however, that notwithstanding anything in this Reserve Agreement to the contrary, the Escrow Agent shall not be liable in any event for special, punitive, indirect, incidental, or consequential losses or damages of any kind whatsoever (including but not limited to lost profits), even if the Escrow Agent has been advised of the likelihood of such loss or damage and regardless of the form of action.  Each of the Shareholders’ Representative and Litigation Entity further agrees to indemnify the Escrow Agent and its affiliates and their respective successors, directors, officers, employees, and consultants (collectively, the “Indemnitees”) and to defend and to hold the Indemnitees harmless against and from any and all claims, demands, costs, damages, losses, penalties, liabilities, and expenses, including reasonable attorneys’ fees, that may be asserted against them or to which they may be exposed or that the Indemnitees may incur for any action taken, suffered, or omitted to be taken, by reason of the execution, administration, or performance of this Reserve Agreement, except to the extent attributable to such Indemnitees’

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intentional misconduct or gross negligence, each as determined by a final, non-appealable judgment of a court of competent jurisdiction.  This paragraph shall survive the resignation, removal or replacement of the Escrow Agent and the termination of this Reserve Agreement until extinguished by any applicable statute of limitations.  The Shareholders’ Representative shall pay the reasonable costs and expenses incurred by the Escrow Agent in enforcing this right of indemnification.

5.2Conditions to Indemnification.  In case any litigation is brought against the Escrow Agent or other Indemnitee in respect of which indemnification may be sought hereunder, the Escrow Agent shall give prompt notice of that litigation to the Shareholders’ Representative, and upon receipt of that notice the Shareholders’ Representative shall have the obligation to assume the defense of such litigation, provided that failure of the Escrow Agent to give such notice shall not relieve the Shareholders’ Representative from its obligations under Section 5 of this Agreement except to the extent that such failure materially prejudices the defense of such litigation but only to the extent of such prejudice.  At its own expense, the Escrow Agent may, but will not be expected to, employ separate counsel and participate in the defense of any litigation so assumed by the Shareholders’ Representative, provided that if the Escrow Agent is advised by its own counsel that there are material legal defenses available to it or any Indemnitee which are different from or additional to those available to the Shareholders’ Representative, or a conflict of interest exists between any of the parties, the Escrow Agent or such Indemnitee will be entitled to obtain its own separate attorney whereby the Shareholders’ Representative shall pay the reasonable attorneys’ fees and expenses for such attorneys.  The parties hereto shall not be liable for any settlement without their respective consents.

5.3Indemnification of Shareholders’ Representative.  Any funds held in the Reserve Account shall be available to the Shareholders’ Representative to indemnify and hold the Shareholders’ Representative harmless against and from any and all claims, demands, costs, damages, losses, penalties, liabilities, and expenses, including reasonable attorneys’ fees, arising out of, from, or in conjunction with the Shareholders’ Representative’s performance or inaction under this Reserve Agreement, the Merger Agreement or the Escrow Agreement, including the reimbursement of expenses, except to the extent attributable to the Shareholders’ Representative’s willful misconduct or gross negligence, each as determined by a final non-appealable judgment of a court of competent jurisdiction.  Prior to the Release Date, the Shareholders’ Representative shall notify the Escrow Agent in writing of the amount of any indemnification claims or reimbursement of expenses to be paid to the Shareholders’ Representative pursuant to this Section 5.3, which amount shall be paid, to the extent funds are available, promptly after Shareholders’ Representative’s request therefor.  Escrow Agent shall each be entitled to rely on any notice given or action taken by Shareholders’ Representative pursuant to this Agreement as being for the benefit of the Shareholders, and shall have no duty to inquire into the circumstances in which any such notice is given or action is taken.

5.4Expenses of Litigation Entity.  Any funds held in the Reserve Account shall be available to the Litigation Entity to pay the expenses related to the pursuit, litigation, settlement, indemnification of the Indemnified Parties and taking of any other actions relating to the Customer Litigation.  Prior to the Release Date, the Litigation Entity shall notify the Escrow Agent in writing of the amount of any expenses to be paid to the Litigation Entity pursuant to this Section 5.4, which amount shall be paid, to the extent funds are available, promptly after the

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Litigation Entity’s request therefor.  Escrow Agent shall each be entitled to rely on any notice given or action taken by the Litigation Entity pursuant to this Agreement as being for the benefit of the Shareholders, and shall have no duty to inquire into the circumstances in which any such notice is given or action is taken.

5.5Priority of Payments.  At the time of the Release Date, the expenses of the Litigation Entity shall be paid prior to any payments made to the Shareholders’ Representative.  After the Release Date, payments shall only be made to the Shareholders’ Representative pursuant to Section 5.3 to the extent any funds remain in the Reserve Account after the payment to the Litigation Entity pursuant to Section 5.4.

6.Acknowledgment by the Escrow Agent.  By execution and delivery of this Reserve Agreement, the Escrow Agent acknowledges that the terms and provisions of this Reserve Agreement are acceptable and it agrees to carry out the express (and not implied) provisions of this Reserve Agreement on its part.

7.Resignation or Removal of Escrow Agent; Successor.

7.1Resignation and Removal.

(a)Notice.  The Escrow Agent may resign as such following not less than thirty (30) days’ prior written notice to the Shareholders’ Representative.  Similarly, the Escrow Agent may be removed and replaced following not less than thirty (30) days’ prior written notice to the Escrow Agent by the Shareholders’ Representative.  In either event, the duties of the Escrow Agent shall terminate thirty (30) days after the date of such notice (or as of such earlier date as may be mutually agreeable), and the Escrow Agent shall then deliver the balance of the Reserve Amount then in its possession to a successor Escrow Agent as shall be appointed by the Shareholders’ Representative as evidenced by a written notice filed with the Escrow Agent.

(b)Court Appointment.  If the Shareholders’ Representative shall have failed to appoint a successor prior to the expiration of thirty (30) days following the date of the notice of resignation or removal of the acting Escrow Agent, then the acting Escrow Agent may petition any court of competent jurisdiction for the appointment of a successor Escrow Agent or other appropriate relief, and any such resulting appointment shall be binding upon all of the parties hereto.

7.2Successors.  Every successor Escrow Agent appointed hereunder shall execute, acknowledge, and deliver to its predecessor and the Shareholders’ Representative a written acceptance of such appointment, and thereupon such successor, without any further act, shall become fully vested with all the duties, responsibilities, and obligations of its predecessor; but such predecessor shall, nevertheless, on the written request of its successor or the Shareholders’ Representative, execute and deliver an instrument or instruments transferring to such successor all the rights of such predecessor hereunder, and shall duly assign, transfer, and deliver all property and records, securities, and monies held by it pursuant to this Reserve Agreement to its successor.

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7.3New Escrow Agent.  In the event of an appointment of a successor Escrow Agent, the predecessor shall cease to be Escrow Agent of any funds and records it may hold pursuant to this Reserve Agreement and the successor shall become the Escrow Agent hereunder.

7.4Release.  Upon written acknowledgment by any successor Escrow Agent of the receipt of the then remaining balance of the Reserve Amount and the property and records it has relating to this Reserve Agreement, the then acting Escrow Agent shall be fully released and relieved of all duties, responsibilities, and obligations under this Reserve Agreement that may arise and accrue thereafter.

8.Fees of Escrow Agent.  The Shareholders’ Representative shall pay the Escrow Agent’s fees for administering the Reserve Account in accordance with the fee schedule attached hereto as Schedule I.  In the event the Escrow Agent is made a party to litigation with respect to the property held hereunder, or brings an action in interpleader, or the Escrow Agent agrees in writing to render any service not provided for in this Reserve Agreement and fee schedule, or there is any modification hereof agreed to in writing by the Escrow Agent, the Escrow Agent shall be entitled to reasonable compensation from the Shareholders’ Representative for such services and reimbursement for all fees, costs, liability, and expenses, including but not limited to reasonable attorneys’ fees.  The provisions of this Section 9 shall survive the termination of this Reserve Agreement and the resignation, removal or replacement of the Escrow Agent with respect to all fees earned and expenses incurred prior to such events.

9.Termination.  Except as otherwise set forth herein, this Reserve Agreement and the escrow created hereby shall terminate following the Escrow Agent’s final delivery of the balance of any remaining Reserve Amount to the Shareholders’ Representative, the Litigation Entity and/or the Exchange Agent pursuant to the terms of this Reserve Agreement and the Merger Agreement.  Notwithstanding the foregoing, the provisions of Sections 3 and 7 of this Reserve Agreement shall survive the termination of this Reserve Agreement and the resignation, removal or replacement of the Escrow Agent.

10.Miscellaneous Provisions.

10.1Parties in Interest.  Except as otherwise expressly set forth herein, this Reserve Agreement is not intended, nor shall it be construed, to confer any enforceable rights on any person not a party hereto.  All of the terms and provisions of this Reserve Agreement will be binding upon and inure to the benefit of and be enforceable by the respective successors and assigns of the parties hereto.

10.2Entire Agreement.  This Reserve Agreement, together with the applicable provisions of the Merger Agreement and Escrow Agreement as referenced herein, constitutes the final and entire agreement among the parties hereto with respect to the subject matter hereof and supersedes all prior arrangements or understandings.  Notwithstanding the foregoing, the Escrow Agent shall not be subject to, nor be required to comply with, or determine if any person or entity has complied with, the Merger Agreement, Escrow Agreement or any other agreement between or among the parties hereto other than this Reserve Agreement, even though reference thereto may be made in this Reserve Agreement.

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10.3Notices.   All notices, requests, demands, or other communications that are required or may be given pursuant to the terms of this Reserve Agreement shall be in writing and shall be deemed to have been duly given (a) on the date of delivery if personally delivered by hand, (b) one day after such notice is sent by an internationally recognized overnight express courier, specifying next day delivery, with written verification of receipt, or (c) if delivered to the applicable email address set forth below, upon confirmed transmission by sender to such email address.  All communications shall be sent to the address as set forth below or at such other address as such party may designate from time to time by means of five (5) days advance written notice to the other parties hereto given in the manner provided in this Section 11.3.

If to the Escrow Agent:

The Chicago Trust Company, N.A., a national association

1000 Hillgrove Avenue

Western Springs, Illinois  60558

Attention:                                         Robert J. Mayo

Chief Executive Officer

Email:                                                            BMayo@wintrustwealth.com

and

If to the Shareholders’ Representative or Litigation Entity:

Anthony V. Sisto

Email:

With a copy to:

Barack Ferrazzano Kirschbaum & Nagelberg LLP

200 West Madison Street, Suite 3900

Chicago, IL 60606

Attention:                                         Dennis R. Wendte

Email:                                                            dennis.wendte@bfkn.com

10.4Changes.  The terms of this Reserve Agreement may not be modified or amended, or any provisions waived, temporarily or permanently, except pursuant to the written agreement of the Shareholders’ Representative, Litigation Entity and the Escrow Agent.  Such amendment, modification or waiver shall be effective only in the specific instance and for the specific purpose given.

10.5Severability.  In the event of any conflict between the terms and provisions of this Reserve Agreement and those of the Merger Agreement or Escrow Agreement, the terms and conditions of this Reserve Agreement will apply. If any term or provision of this Reserve Agreement or the application thereof as to any person or circumstance is held invalid or unenforceable to any extent, the remaining terms and provisions of this Reserve Agreement or

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the application of such term or provision to persons or circumstances other than those as to which it is held invalid or unenforceable shall not be affected thereby and each term and provision of this Reserve Agreement shall be valid and enforceable to the fullest extent permitted by law.

10.6Counterparts.  This Reserve Agreement may be executed in two or more counterparts, each of which shall be deemed an original and shall bind the signatory, but all of which together shall constitute one and the same instrument.  The execution and delivery (including via electronic mail) of a signature page in the form attached to this Reserve Agreement by any party hereto who has been furnished the final form of this Reserve Agreement shall constitute the execution and delivery of this Reserve Agreement by such party.  Signature pages in portable document format (PDF) delivered via email shall be treated as if they were originals.

10.7Headings.  The headings of the sections of this Reserve Agreement have been inserted for convenience of reference only and shall not be deemed to be a part of this Reserve Agreement.

10.8Assignment.  This Reserve Agreement may not be assigned, or otherwise transferred, in whole or in part, by any party without the prior written consent of the other parties, which the other parties will not unreasonably withhold, condition or delay; except that consent is not required for appointment of a successor Shareholders’ Representative. Any attempted assignment in violation of the foregoing will be void.

10.9Governing Law.  This Reserve Agreement shall be construed and controlled by the laws of the State of Illinois without regard to the principles of conflicts of laws.

10.10Binding Effect.  This Reserve Agreement shall inure to the benefit of and be binding upon the parties hereto and their respective heirs, affiliates, successors, and assigns.

[Signature Page Follows]

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IN WITNESS WHEREOF, the parties have executed this Reserve Agreement as of the date first above written.

SHAREHOLDERS’ REPRESENTATIVE:

Anthony V. Sisto

ESCROW AGENT:

THE CHICAGO TRUST COMPANY, N.A.

By:

Name:

Title:

LITIGATION ENTITY:

By:

Anthony V. Sisto

Manager

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EXHIBIT A

MERGER AGREEMENT

(See attached.)

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SCHEDULE I

ESCROW AGENT FEES

One-time Account Administration Fee                                                  $3,500

This one-time fee will cover the Escrow Agent’s review of the Reserve Agreement and standard escrow services including, but not limited to, account set-up, safekeeping of assets, investment of funds, collection of income and other receipts, preparation of statements comprising account activity and asset listing, and distribution of assets in accordance with the specific terms of the Reserve Agreement.

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Exhibit I

Form of Assignment Agreement

THIS ASSIGNMENT AGREEMENT (this “Agreement”) is made and entered into as of          , 20  , by and between STC Capital Bank, an Illinois-chartered, non-member bank with its main office located in St. Charles, Illinois (“Assignor”), and          , a          limited liability company (“Assignee”), in connection with the Agreement and Plan of Merger dated June 5, 2019, as amended July 1, 2019 (the “Merger Agreement”), among Wintrust Financial Corporation, an Illinois corporation (“Wintrust”), WTFC STCBC Merger Sub LLC, an Illinois limited liability company (“Merger Sub”), and STC Bancshares Corp., an Illinois corporation (“STC”).  Wintrust and Merger Sub join in this Agreement for the purposes set forth below.  The parties to this Agreement are Assignor, Assignee, Merger Sub and Wintrust (the “Parties”).

RECITALS

A.                                    On April 8, 2019, Assignor filed an action in the Circuit Court of the Sixteenth Judicial Circuit in Kane County, Illinois, styled STC Capital Bank v. David C. Ozzello, et al., Case No. 19 L 000168 (the “Action”).

B.                                    In the Action, Assignor asserted several claims against David C. Ozzello and Karen H. Ozzello, individually and as trustees of the David C. Ozzello Trust, and the David C. Ozzello Trust (collectively, the “Defendants”).

C.                                    The claims asserted in the Action by Assignor arise in connection with two accounts held at Assignor:  account number 1000025412 owned by David C. Ozzello and Karen H. Ozzello, and account number 1000010772 owned by the David C. Ozzello Trust (collectively, the “Accounts”).

D.                                    Assignor alleges in the Action that the Accounts are overdrawn as a result of the return by Bellco Credit Union, Greenwood Village, Colorado (“Bellco”), of certain checks written on accounts held at Bellco and owned by Mark D. Ray, Custom Consulting & Product Service LLC, and MR Cattle Production Service LLC (collectively, the “Ray Parties”).

E.                                    Assignor is a wholly-owned subsidiary of STC, and STC has agreed to merge with and into Merger Sub, pursuant to the terms of the Merger Agreement.

F.                                     Assignee is a limited liability company managed by the Shareholders’ Representative formed for the benefit of STC’s shareholders.

G.                                   Capitalized terms used but not otherwise defined in this Agreement have the meanings given to them in the Merger Agreement.

H.                                   Assignor wishes to assign to Assignee the Assigned Claims (as defined below), including the right to recover any monies on the Assigned Claims, and Assignee wishes to assume such Assigned Claims and such recovery rights for the benefit of the shareholders of the Company, in accordance with the terms and provisions set forth in this Agreement.

I.                                        Wintrust and Merger Sub are each willing to consent to the assignment by Assignor to Assignee of the Assigned Claims and such recovery rights, in accordance with the terms and provisions set forth in this Agreement.

In consideration of the foregoing premises, which are incorporated herein by this reference, and the mutual promises, covenants and agreements contained in this Agreement and the Merger Agreement,

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and for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties agree as follows:

AGREEMENTS

Section 1.Assigned Claims.  The term “Assigned Claims” means any and all rights, title, and interest in and to, and any and all liabilities and obligations arising from or related to any and all of Assignor’s claims, insurance claims, bond claims, actions, causes of action, choses in action, charges, complaints, agreements, promises, controversies, damages, suits, rights, demands, privileges and benefits of any kind, type or nature whatsoever, whether in equity or at law, under contract, tort, securities or any other substantive right, known or unknown, foreseen or unforeseen, suspected or unsuspected, asserted or unasserted, contingent or otherwise, that Assignor had, now has, or may have against the Defendants or any other party, including Federal Insurance Company or any other insurer, that are in any manner related to the Action, the Defendants, the Accounts, Bellco, or the Ray Parties based on facts or events occurring prior to the date of this Agreement, including all rights to attorneys’ fees, expenses, and costs incurred in relation to, in connection with, or as a result of the Action, the Defendants, the Accounts, Bellco, or the Ray Parties. For the avoidance of doubt, the Parties acknowledge that STC and Assignor have submitted a bond claim to Federal Insurance Company under Bond Number 82029060 (the “Federal Insurance Policy”) that directly relates to the Assigned Claims (the “Federal Insurance Claim”), that Assignee has the right to receive any proceeds from the Federal Insurance Claim to the extent such proceeds are assignable, and to pursue any legal action in relation to the Federal Insurance Claim, and that in the event Federal Insurance Company pays any money to Assignor, Wintrust or Merger Sub with respect to the Federal Insurance Claim, that money shall be paid to Assignee within five (5) business days after receipt thereof. The Parties further acknowledge that no rights under the Federal Insurance Policy or any other insurance policy owned by Assignor or STC are assigned pursuant to this Agreement other than the Federal Insurance Claim or any other insurance claim or bond claim that may be submitted in connection with the Assigned Claims.

Section 2.Assignment and Assumption.  The Assigned Claims shall be assigned to and assumed by and shall become the property and obligations of the Assignee as of immediately prior to the Effective Time.  The Parties acknowledge that, pursuant to the prior sentence, the Assigned Claims shall transfer from Assignor to Assignee immediately prior to Closing automatically without any further action by the Parties.  Each of Assignor, Merger Sub and Wintrust acknowledges that upon transfer, none of them shall have any rights whatsoever in the Assigned Claims, and Assignee acknowledges that upon transfer, none of Assignor, Merger Sub or Wintrust shall have any liabilities whatsoever under the Assigned Claims and Assignee agrees to observe, perform, pay and satisfy all liabilities and obligations arising under or related to the Assigned Claims.

Section 3.Right to Control LitigationAssignee shall have full authority and control over the Action and any action that may be filed in the future that in any manner relates to the Assigned Claims, including the right to decide if, when, and on what terms to settle the Action and any later filed action or to abandon the Action or any later filed action.

Section 4.Recovery on Assigned Claims.  None of Assignor, Merger Sub or Wintrust shall have any right to any money paid to Assignee in connection with the Assigned Claims.  If Assignee is paid any money in connection with the Assigned Claims, Assignee shall deposit that money into the Reserve Account for further handling in accordance with the terms of the Reserve Agreement.

Section 5.Cooperation.  Each of Assignor, Merger Sub and Wintrust agrees to reasonably cooperate, at Assignee’s reasonable cost, with Assignee and his employees, agents, representatives and counsel in connection with the Action and any action, investigation, insurance claim, or bond claim that in any manner relates to the Assigned Claims.  For the sake of clarity, the Parties agree that the obligations of Assignor, Merger Sub and Wintrust pursuant to the terms of this Section 5 shall include

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allowing Assignee and his employees, agents, representatives and counsel reasonable access, including reasonable advance request for such access, to all books, records and other documents requested by them and that are within the control of any Party or its affiliates, and reasonable access to any personnel employed by any Party or its affiliates, with whom they wish to communicate, provided, however, that any such books, records and other documents, and access to such personnel, are reasonably related to the Assigned Claims and not unreasonably disruptive to the operations of such Party or its affiliates.  Each of Assignor, Merger Sub and Wintrust will also reasonably cooperate with Assignee in pursuing the Federal Insurance Claim and in preparing, submitting, and pursuing any further insurance claims or bond claims requested by Assignee, whether under the Federal Insurance Policy or another policy that may cover any loss that in any manner relates to the Assigned Claims, and to pay any proceeds from any such insurance claims or bond claims that may be received by Assignor, Wintrust or Merger Sub to Assignee within five (5) business days of receiving payment on such claims, provided that Assignee pays the reasonable cost of preparing, submitting, and pursuing such claims.

Section 6.Indemnification.  Each of Assignor, Merger Sub and Wintrust and any of Wintrust’s subsidiaries and affiliates (the “Indemnified Parties”) shall be indemnified and held harmless from and against any and all Claims relating to, or arising out of, or resulting from any actions or decisions taken or made by Assignee in exercising its control over the Action and any action that Assignee may file in the future that in any manner relates to the Assigned Claims, including (i) any action or decision made in connection with the settlement or abandonment of the Action or any such later filed action and (ii) any action taken or decision made by Assignee under the Reserve Agreement.  During the pendency of the Escrow Agreement, the Indemnified Parties shall be entitled to include any such Claim as an Indemnity Claim (as such term is defined in the Escrow Agreement).  To the extent not satisfied by the Escrow Amount, or if any such Claim arises following termination of the Escrow Agreement, such indemnification obligations shall be satisfied first from the Reserve Amount and all such Claims shall survive until the termination of the Reserve Agreement.

Section 7.General Provisions.  This Agreement shall be binding on and shall inure to the benefit of each of the Parties and its respective heirs, legal representatives, successors and assigns.  The Parties agree that any rule of construction under which ambiguities are construed against the drafter of a legal document is not applicable and shall not apply to this Agreement.  If any provision hereof shall for any reason be held to be invalid or unenforceable, such invalidity or unenforceability shall not affect any other provision hereof.  This Agreement may be executed in one or more counterparts, by facsimile, pdf, or otherwise, each of which shall be deemed an original, but all of which together shall constitute one and the same agreement.  Words used in this Agreement in the singular, where the context so permits, shall be deemed to include the plural and vice versa.  The terms “and” and “or” shall be construed both conjunctively and disjunctively.

Section 8.Governing Law.  All issues and questions concerning the construction, validity, enforcement and interpretation of this Agreement shall be governed by, and construed in accordance with, the laws of the State of Illinois, without giving effect to any choice of law or conflict of law rules or provisions (whether of the State of Illinois or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Illinois.

Section 9.Authorization to Act.  Each of the Parties warrants and represents that it has the full right and power to execute, deliver, and perform this Agreement.  Any individual that executes this document on behalf of a Party certifies that he or she has authority to act for such Party, and that he or she, and any additional persons whose names, titles (if any) and signatures appear on the signature page to this Agreement, have full and complete authority to act on behalf of such Party in any and all respects and in any and all matters or transactions provided for or contemplated by this Agreement.

[SIGNATURE PAGE FOLLOWS]

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IN WITNESS WHEREOF, Assignor, Assignee, Wintrust and Merger Sub have each executed this Agreement as of the day and year first written above.

WINTRUST FINANCIAL CORPORATION

WTFC STCBC MERGER SUB LLC

By:

By:

Name:

Name:

Title:

Title:

STC CAPITAL BANK

By:

By:

Name:

Anthony V. Sisto

Title:

Manager

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Annex B

SECTIONS 11.65 AND 11.70 OF THE ILLINOIS BUSINESS CORPORATION ACT

(805 ILCS 5/11.65) (from Ch. 32, par. 11.65)

Sec. 11.65. Right to dissent. (a) A shareholder of a corporation is entitled to dissent from, and obtain payment for his or her shares in the event of any of the following corporate actions:

1.              consummation of a plan of merger or consolidation or a plan of share exchange to which the corporation is a party if (i) shareholder authorization is required for the merger or consolidation or the share exchange by Section 11.20 or the articles of incorporation or (ii) the corporation is a subsidiary that is merged with its parent or another subsidiary under Section 11.30;

2.              consummation of a sale, lease or exchange of all, or substantially all, of the property and assets of the corporation other than in the usual and regular course of business;

3.              an amendment of the articles of incorporation that materially and adversely affects rights in respect of a dissenter’s shares because it:

i.                  alters or abolishes a preferential right of such shares;

ii.               alters or abolishes a right in respect of redemption, including a provision respecting a sinking fund for the redemption or repurchase, of such shares;

iii.            in the case of a corporation incorporated prior to January 1, 1982, limits or eliminates cumulative voting rights with respect to such shares; or

4.              any other corporate action taken pursuant to a shareholder vote if the articles of incorporation, by-laws, or a resolution of the board of directors provide that shareholders are entitled to dissent and obtain payment for their shares in accordance with the procedures set forth in Section 11.70 or as may be otherwise provided in the articles, by-laws or resolution.

(b) A shareholder entitled to dissent and obtain payment for his or her shares under this Section may not challenge the corporate action creating his or her entitlement unless the action is fraudulent with respect to the shareholder or the corporation or constitutes a breach of a fiduciary duty owed to the shareholder.

(c) A record owner of shares may assert dissenters’ rights as to fewer than all the shares recorded in such person’s name only if such person dissents with respect to all shares beneficially owned by any one person and notifies the corporation in writing of the name and address of each person on whose behalf the record owner asserts dissenters’ rights. The rights of a partial dissenter are determined as if the shares as to which dissent is made and the other shares were recorded in the names of different shareholders. A beneficial owner of shares who is not the record owner may assert dissenters’ rights as to shares held on such person’s behalf only if the beneficial owner submits to the corporation the record owner’s written consent to the dissent before or at the same time the beneficial owner asserts dissenters’ rights.

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(Source: P.A. 85-1269.)

(805 ILCS 5/11.70) (from Ch. 32, par. 11.70)

Sec. 11.70. Procedure to Dissent.

(a) If the corporate action giving rise to the right to dissent is to be approved at a meeting of shareholders, the notice of meeting shall inform the shareholders of their right to dissent and the procedure to dissent. If, prior to the meeting, the corporation furnishes to the shareholders material information with respect to the transaction that will objectively enable a shareholder to vote on the transaction and to determine whether or not to exercise dissenters’ rights, a shareholder may assert dissenters’ rights only if the shareholder delivers to the corporation before the vote is taken a written demand for payment for his or her shares if the proposed action is consummated, and the shareholder does not vote in favor of the proposed action.

(b) If the corporate action giving rise to the right to dissent is not to be approved at a meeting of shareholders, the notice to shareholders describing the action taken under Section 11.30 or Section 7.10 shall inform the shareholders of their right to dissent and the procedure to dissent. If, prior to or concurrently with the notice, the corporation furnishes to the shareholders material information with respect to the transaction that will objectively enable a shareholder to determine whether or not to exercise dissenters’ rights, a shareholder may assert dissenter’s rights only if he or she delivers to the corporation within 30 days from the date of mailing the notice a written demand for payment for his or her shares.

(c) Within 10 days after the date on which the corporate action giving rise to the right to dissent is effective or 30 days after the shareholder delivers to the corporation the written demand for payment, whichever is later, the corporation shall send each shareholder who has delivered a written demand for payment a statement setting forth the opinion of the corporation as to the estimated fair value of the shares, the corporation’s latest balance sheet as of the end of a fiscal year ending not earlier than 16 months before the delivery of the statement, together with the statement of income for that year and the latest available interim financial statements, and either a commitment to pay for the shares of the dissenting shareholder at the estimated fair value thereof upon transmittal to the corporation of the certificate or certificates, or other evidence of ownership, with respect to the shares, or instructions to the dissenting shareholder to sell his or her shares within 10 days after delivery of the corporation’s statement to the shareholder. The corporation may instruct the shareholder to sell only if there is a public market for the shares at which the shares may be readily sold. If the shareholder does not sell within that 10 day period after being so instructed by the corporation, for purposes of this Section the shareholder shall be deemed to have sold his or her shares at the average closing price of the shares, if listed on a national exchange, or the average of the bid and asked price with respect to the shares quoted by a principal market maker, if not listed on a national exchange, during that 10 day period.

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(d) A shareholder who makes written demand for payment under this Section retains all other rights of a shareholder until those rights are cancelled or modified by the consummation of the proposed corporate action. Upon consummation of that action, the corporation shall pay to each dissenter who transmits to the corporation the certificate or other evidence of ownership of the shares the amount the corporation estimates to be the fair value of the shares, plus accrued interest, accompanied by a written explanation of how the interest was calculated.

(e) If the shareholder does not agree with the opinion of the corporation as to the estimated fair value of the shares or the amount of interest due, the shareholder, within 30 days from the delivery of the corporation’s statement of value, shall notify the corporation in writing of the shareholder’s estimated fair value and amount of interest due and demand payment for the difference between the shareholder’s estimate of fair value and interest due and the amount of the payment by the corporation or the proceeds of sale by the shareholder, whichever is applicable because of the procedure for which the corporation opted pursuant to subsection (c).

(f) If, within 60 days from delivery to the corporation of the shareholder notification of estimate of fair value of the shares and interest due, the corporation and the dissenting shareholder have not agreed in writing upon the fair value of the shares and interest due, the corporation shall either pay the difference in value demanded by the shareholder, with interest, or file a petition in the circuit court of the county in which either the registered office or the principal office of the corporation is located, requesting the court to determine the fair value of the shares and interest due. The corporation shall make all dissenters, whether or not residents of this State, whose demands remain unsettled parties to the proceeding as an action against their shares and all parties shall be served with a copy of the petition. Nonresidents may be served by registered or certified mail or by publication as provided by law. Failure of the corporation to commence an action pursuant to this Section shall not limit or affect the right of the dissenting shareholders to otherwise commence an action as permitted by law.

(g) The jurisdiction of the court in which the proceeding is commenced under subsection (f) by a corporation is plenary and exclusive. The court may appoint one or more persons as appraisers to receive evidence and recommend decision on the question of fair value. The appraisers have the power described in the order appointing them, or in any amendment to it.

(h) Each dissenter made a party to the proceeding is entitled to judgment for the amount, if any, by which the court finds that the fair value of his or her shares, plus interest, exceeds the amount paid by the corporation or the proceeds of sale by the shareholder, whichever amount is applicable.

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(i) The court, in a proceeding commenced under subsection (f), shall determine all costs of the proceeding, including the reasonable compensation and expenses of the appraisers, if any, appointed by the court under subsection (g), but shall exclude the fees and expenses of counsel and experts for the respective parties. If the fair value of the shares as determined by the court materially exceeds the amount which the corporation estimated to be the fair value of the shares or if no estimate was made in accordance with subsection (c), then all or any part of the costs may be assessed against the corporation. If the amount which any dissenter estimated to be the fair value of the shares materially exceeds the fair value of the shares as determined by the court, then all or any part of the costs may be assessed against that dissenter. The court may also assess the fees and expenses of counsel and experts for the respective parties, in amounts the court finds equitable, as follows:

1.              Against the corporation and in favor of any or all dissenters if the court finds that the corporation did not substantially comply with the requirements of subsections (a), (b), (c), (d), or (f).

2.              Against either the corporation or a dissenter and in favor of any other party if the court finds that the party against whom the fees and expenses are assessed acted arbitrarily, vexatiously, or not in good faith with respect to the rights provided by this Section.

If the court finds that the services of counsel for any dissenter were of substantial benefit to other dissenters similarly situated and that the fees for those services should not be assessed against the corporation, the court may award to that counsel reasonable fees to be paid out of the amounts awarded to the dissenters who are benefited. Except as otherwise provided in this Section, the practice, procedure, judgment and costs shall be governed by the Code of Civil Procedure.

(j) As used in this Section:

1.              “Fair value”, with respect to a dissenter’s shares, means the proportionate interest of the shareholder in the corporation, without discount for minority status or, absent extraordinary circumstance, lack of marketability, immediately before the consummation of the corporate action to which the dissenter objects excluding any appreciation or depreciation in anticipation of the corporate action, unless exclusion would be inequitable.

2.              “Interest” means interest from the effective date of the corporate action until the date of payment, at the average rate currently paid by the corporation on its principal bank loans or, if none, at a rate that is fair and equitable under all the circumstances.

(Source: P.A. 94-889, eff. 1-1-07.)

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Annex C

Voting Agreement

THIS AGREEMENT (“Agreement”) is made and entered into as of the 5th day of June, 2019, by and between the undersigned shareholders (each, a “Shareholder,” and collectively, the “Shareholders”) of STC BANCSHARES CORP., an Illinois corporation (the “Company”), and WINTRUST FINANCIAL CORPORATION, an Illinois corporation (“Wintrust”).

WITNESSETH:

WHEREAS, the Company and Wintrust, together with WTFC STCBC Merger Sub LLC, an Illinois limited liability company and wholly owned subsidiary of Wintrust (“Merger Co.”), have entered into an Agreement and Plan of Merger dated as of the date hereof (the “Merger Agreement”) (capitalized terms used but not defined in this Agreement shall have the meanings given them in the Merger Agreement);

WHEREAS, as a condition to Wintrust and Merger Co. being willing to enter into the Merger Agreement, and as an inducement and in consideration therefor, each of the Shareholders has agreed to execute and deliver this Agreement, solely in his, her or its capacity as a shareholder of the Company; and

WHEREAS, each Shareholder owns and is entitled to vote the number of issued and outstanding shares of common stock of the Company (the “Company Stock”), as set forth opposite such Shareholder’s name on Schedule 1 attached hereto, and has agreed to vote such Shareholder’s Company Stock pursuant to the terms set forth in this Agreement.

NOW, THEREFORE, in consideration of the premises and the respective representations, warranties, covenants and agreements set forth herein, the Shareholders and Wintrust hereby agree as follows:

Section 1.Voting of Shares.  Each Shareholder hereby agrees that at any meeting of the shareholders of the Company, and at every adjournment or postponement thereof, and in any action by written consent of the shareholders of the Company, such Shareholder shall appear or otherwise cause all shares of Company Stock (including any shares obtained as a result of exercising one or more Company stock options) which such Shareholder owns and is entitled to vote to be counted as present for purposes of establishing a quorum at any such meeting of the shareholders of the Company, and shall vote all shares of Company Stock which such Shareholder owns and is entitled to vote (a) in favor of the adoption and approval of the Merger Agreement and the transactions contemplated thereby, (b) in favor of the approval of any proposal to adjourn or postpone the meeting to a later date, if requested by Wintrust or Merger Co., (c) against any action, proposal, transaction or agreement which would result in a breach of any term of, or any other obligation of the Company under, the Merger Agreement, (d) against any action or agreement which would impede, interfere with, prevent or attempt to discourage the transactions contemplated by the Merger Agreement, including, but not limited to, any other extraordinary corporate transaction, including, but not limited to, a merger, acquisition, sale, consolidation, reorganization, recapitalization, extraordinary dividend or liquidation involving the Company or the Bank and any Person (other than Wintrust, Merger Co. or their respective affiliates), or any other proposal of any Person (other than Wintrust, Merger Co. or their respective affiliates) to acquire the Company or the Bank or all or substantially all of the respective assets thereof, (e) against any Company Takeover Proposal, and (f) in favor of any other matter necessary for consummation of the transactions contemplated by the Merger Agreement; provided, however, that nothing in this Agreement shall prevent, limit or affect any actions or omissions taken by a Shareholder

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who may also serve as a director and/or officer of the Company in the course of discharging his or her fiduciary duties to the Company in his or her capacity as a director and/or officer, and no such actions or omissions shall be deemed to be a breach of this Agreement.  Each Shareholder agrees that the Company shall be authorized to include in any proxy or material transmitted to shareholders of the Company or filed with the Commission or any other Governmental Authority or any press release or other document that Wintrust or Merger Co. reasonably determines to be necessary in connection with the transactions contemplated by the Merger Agreement, such Shareholder’s identity and ownership of Company Stock, and a statement to the effect that the Shareholder is a party to this Agreement and has committed to vote in favor of the transactions contemplated by the Merger Agreement (the “Shareholder Information”).  Each of the Shareholders agrees to promptly give Wintrust any Shareholder Information it may reasonably require for the preparation of any such documents, and each of the Shareholders agrees to promptly notify Wintrust of any required corrections with respect to any written Shareholder Information supplied by it specifically for use in any such document, if and to the extent that the Shareholder shall become aware that any Shareholder Information shall have become false or misleading in any material respect.

Section 2.Term of Agreement.  This Agreement shall be effective from the date hereof and shall terminate and be of no further force and effect upon the earlier of (i) the Effective Time (as defined in the Merger Agreement), or (ii) the termination of the Merger Agreement in accordance with its terms, which includes termination of the Merger Agreement by the Company pursuant to Section 9.2 of the Merger Agreement, but shall in no event be effective for longer than twenty-five (25) years.  Nothing in this Section 2 shall relieve any party of liability for breach of this Agreement.

Section 3.Covenants of Shareholders.  Each Shareholder agrees not to: except to the extent required by this Agreement or in the event of the death or permanent disability of Shareholder, alter, transfer, sell, assign, gift, hedge, pledge or otherwise dispose (whether by sale, liquidation, dissolution, dividend, distribution, or otherwise) of, or enter into any derivative arrangement with respect to (each, a “Transfer”), any or all of such Shareholder’s Company Stock or any right or interest therein (or consent to any of the foregoing); enter into any contract or agreement with respect to any Transfer of any or all of such Shareholder’s Company Stock or any right or interest therein; grant any proxies, deposit any Company Stock into a voting trust or enter into a voting agreement (except pursuant to this Agreement), in each case with respect to any shares of Company Stock; create or permit to exist any Encumbrance on any or all of such Shareholder’s Company Stock; take or permit any other action that would in any way restrict, limit or interfere with the performance of such Shareholder’s obligations hereunder or the transactions contemplated hereby or otherwise make any representation or warranty of such Shareholder herein untrue or incorrect in any material respect; or without the prior written approval of Wintrust, directly or indirectly, solicit, initiate, encourage or facilitate any Company Takeover Proposal or enter into any agreement with respect to, or initiate or participate in any negotiations or discussions with any Person concerning any Company Takeover Proposal, or furnish any information to any Person proposing or seeking an Company Takeover Proposal.  Each Shareholder hereby agrees, while this Agreement is in effect, to promptly notify Wintrust of the number of any new shares of Company Stock acquired by such Shareholder, if any, after the date hereof.  Any such Company Stock shall be subject to the terms of this Agreement as though owned by such Shareholder on the date hereof.  If Transfer of ownership is occasioned by the death or permanent disability of such Shareholder, prior to any such Transfer, such Shareholder or his or her representative shall cause the transferee to agree to be bound by the terms and conditions of this Agreement and to execute a joinder to this Agreement.

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Section 4.No Exercise of Dissenters’ Rights; Actions.   Each of the Shareholders (a) waives and agrees not to demand appraisal of such Shareholder’s Company Stock pursuant to the IBCA and (b) agrees not to commence or join in, and agrees to take all actions necessary to opt out of, any class in any class action with respect to, any claim, derivative or otherwise, against Wintrust, Merger Co., the Company or any of their respective representatives (i) challenging the validity of, or seeking to enjoin the operation of, any provision of this Agreement or (ii) alleging breach of any fiduciary duty of any Person in connection with the negotiation and entry into, the Merger Agreement.

Section 5.Representations and Warranties of Shareholders.  Each Shareholder represents and warrants to Wintrust as follows:  (a) such Shareholder owns, and is entitled to vote in accordance with such Shareholder’s commitments under this Agreement, the number of shares and applicable classes and series of Company Stock set forth opposite his, her or its name on Schedule 1 hereto, and does not own or have any right to acquire any Company Stock not listed on Schedule 1; (b) such Shareholder has the right, power and authority to execute, deliver and perform under this Agreement; such execution, delivery and performance will not violate, or require any consent, approval, or notice under any provision of law or result in the breach of any outstanding agreements or instruments to which such Shareholder is a party or is subject; and this Agreement has been duly executed and delivered by such Shareholder and constitutes a legal, valid and binding agreement of such Shareholder, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors generally and to general principles of equity; (c) such Shareholder’s shares of Company Stock listed as owned on Schedule 1 hereto are now and will remain owned by such Shareholder, free and clear of all voting trusts, voting agreements, proxies, liens, claims, liabilities, security interests, marital property rights or any other Encumbrances whatsoever (other than (i) pledges for loans entered into in the ordinary course and (ii) rights of Wintrust and Encumbrances respecting such Company Stock created pursuant to this Agreement or the Merger Agreement); (d) other than set forth on Schedule 1 to this Agreement and in the Merger Agreement, there are no outstanding options, warrants or rights to purchase or acquire, or agreements related to, such Shareholder’s Company Stock; (e) there are no claims, actions, suits or proceedings pending or, to the knowledge of such Shareholder, threatened or contemplated against or affecting such Shareholder, at law or in equity, or before any federal, state or other Governmental Authority or any arbitrator or arbitration panel, whether by contract or otherwise, and there is no decree, judgment or order or formal supervisory agreement of any kind in existence against or restraining such Shareholder from taking any action of any kind in connection with their respective properties or assets (including such Shareholder’s Company Stock) that would reasonably be expected to prevent or materially delay or impair the consummation of the transactions contemplated by this Agreement or the Merger Agreement or otherwise adversely impact such Shareholder’s ability to perform its obligations hereunder in any material respect; and (f) such Shareholder has had the opportunity to review the Merger Agreement and this Agreement with counsel of such Shareholder’s own choosing, and such Shareholder understands and acknowledges that Wintrust is entering into the Merger Agreement in reliance upon such Shareholder’s execution, delivery and performance of this Agreement.

Section 6.Representations and Warranties of Wintrust.  Wintrust has the right, power and authority to execute and deliver this Agreement; such execution and delivery will not violate, or require any consent, approval, or notice under any provision of law or result in the breach of any outstanding agreements or instruments to which Wintrust is a party or is subject; and this Agreement has been duly executed and delivered by Wintrust and constitutes a legal, valid and binding agreement of Wintrust,

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enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors generally and to general principles of equity.

Section 7.Transferability.  Neither this Agreement nor any of the rights, interests or obligations hereunder shall be assigned by any of the parties hereto (whether by operation of law or otherwise) without the prior written consent of the other parties, except that Wintrust may assign this Agreement to a direct or indirect wholly-owned subsidiary or affiliate of Wintrust, provided that no such assignment shall relieve Wintrust of its obligations hereunder.

Section 8.Specific Performance.  The parties hereto agree that irreparable damage would occur in the event that any of the provisions of this Agreement was not performed by any of the Shareholders in accordance with its specific terms or was otherwise breached.  It is accordingly agreed that Wintrust shall (without any requirement for the posting of any bond) be entitled to injunctive relief to prevent breaches of this Agreement by the Shareholders and to enforce specifically the terms and provisions hereof in addition to any other remedy to which Wintrust is entitled at law or in equity.

Section 9.Further Assurances.  Each Shareholder agrees to execute and deliver all such further documents and instruments and take all such further action as may be necessary or appropriate in order to consummate the transactions contemplated hereby.

Section 10.Entire Agreement and Amendment.

(a)                                 Except for the Merger Agreement and its ancillary agreements and instruments, this Agreement contains the entire agreement between the parties hereto with respect to the transactions contemplated hereunder and supersedes all prior arrangements or understandings with respect hereto.  The parties acknowledge and agree that the covenants and agreements of each Shareholder made herein are for the benefit of Wintrust, and at any time Wintrust may (without the consent of any Shareholder) (i) extend the time for the performance of any of the obligations or other acts of any Shareholder, (ii) waive any inaccuracies in any Shareholder’s representations and warranties contained in this Agreement or in any document delivered pursuant to this Agreement or (iii) waive compliance with any of a Shareholder’s agreements or conditions contained in this Agreement. Any agreement by Wintrust to any such extension or waiver shall be valid only if set forth in an instrument in writing signed on behalf of Wintrust. The failure of any party to this Agreement to assert any of its rights under this Agreement or otherwise shall not constitute a waiver of such rights. Each Shareholder agrees that Wintrust may, in its sole discretion, exercise its rights against some, but not all, Shareholders. For any matter under this Agreement requiring the consent or approval of any party, such consent or approval shall be valid and binding on a party hereto only if such consent or approval is delivered in an instrument in writing signed on behalf of such party.

(b)                     This Agreement may not be modified, amended, altered or supplemented except upon the execution and delivery of a written agreement executed by the parties hereto.

Section 11.Notices.  Each notice, demand or other communication which may be or is required to be given under this Agreement shall be in writing and shall be deemed to have been properly given when delivered personally at the address set forth herein for Wintrust or the address on Schedule 1 for a Shareholder, when sent by facsimile or other electronic transmission to the respective facsimile transmission numbers of a party with telephone confirmation of receipt, or the day after sending by recognized overnight courier or if by the United States registered or certified mail, return receipt requested, postage prepaid two days after deposit therein.

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Section 12.General Provisions.  This Agreement shall be governed by the laws of the State of Illinois, without giving effect to the conflicts of laws principles thereof. Each of the parties hereto (a) consents to submit itself to the personal jurisdiction of any Illinois state court located in Chicago, Illinois or any Federal court located in Chicago, Illinois (or any court with appellate jurisdiction therefrom) in the event any dispute arises out of this Agreement or the transactions contemplated hereby, (b) agrees that it will not attempt to deny or defeat such personal jurisdiction by motion or other request for leave from any such court, (c) agrees that it will not bring any action relating to this Agreement or the transactions contemplated hereby in any court other than any Illinois state court located in Chicago, Illinois or any Federal court sitting in the State of Illinois and (d) waives any right to trial by jury with respect to any action related to or arising out of this Agreement or the transactions contemplated hereby. This Agreement may be executed in counterparts, each of which shall be deemed to be an original.  Headings are for convenience only and shall not affect the meaning of this Agreement.  Any term of this Agreement which is invalid or unenforceable shall be ineffective only to the extent of such invalidity or unenforceability without rendering invalid or unenforceable the remaining terms of this Agreement.  The parties have participated jointly in the negotiation and drafting of this Agreement. In the event of an ambiguity or question of intent or interpretation arises, this Agreement will be construed as if drafted jointly by the parties and no presumption or burden of proof will arise favoring or disfavoring any party by virtue of the authorship of any provision of this Agreement. The rights and remedies of any person under this Agreement are not exclusive of or limited by any other rights or remedies which it may have, whether at law, in equity, by contract or otherwise, all of which shall be cumulative (and not alternative). The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective representatives, successors and assigns. In any action, suit or other proceeding relating to this Agreement or the enforcement of any provision of this Agreement, the prevailing party in such action, suit or other proceeding shall be entitled to recover reasonable attorneys’ fees, costs and disbursements (in addition to any other relief to which such prevailing party may be entitled) from the non-prevailing party or parties.

Section 13.Legal Counsel. Each Shareholder acknowledges that he, she or it has been advised to, and has had the opportunity to consult with his, her or its personal attorney prior to entering into this Agreement. Each Shareholder further acknowledges that attorneys for the Company represent the Company and do not represent such Shareholder or any other shareholder of the Company in connection with the Merger Agreement, this Agreement or any of the transactions contemplated hereby or thereby.

[SIGNATURE PAGE FOLLOWS]

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written.

WINTRUST FINANCIAL CORPORATION, an Illinois Corporation

By:

Its:

Address for Notices:

With a copy to

Wintrust Financial Corporation

Matthew G. Galo

9700 W. Higgins Road, Suite 800

Schiff Hardin LLP

Rosemont, Illinois 60018

233 S. Wacker Drive, Suite 7100

Attn:

Kathleen M. Boege

Chicago, Illinois 60606-6473

Executive Vice President, General Counsel and Corporate Secretary

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SHAREHOLDERS:

NAME, ADDRESSAND FACSIMILE

NUMBEROF SHAREHOLDER

NUMBEROF COMPANY COMMON

STOCK OWNEDBY SHAREHOLDER

NUMBEROF COMPANY COMMON

STOCK ISSUABLE UNDER OPTIONS

HELDBY SHAREHOLDER

[Attached]

Ownership Title of Stock CertificateAnthony V. Sisto

Number of Shares

Debra J. Alder

603 Alder Avenue

Delavan, WI 53115

2,636

Pershing LLC Custodian FBO Donald J. Boltz Roth IRA

One Pershing Plaza

P. O. Box 2050

Jersey City, NJ 07303Christopher Woelffer

8,189

Pershing LLC Custodian FBO Donald J. Boltz Individual K

One Pershing Plaza

P. O. Box 2050

Jersey City, NJ 07303

3,476

Donald J. Boltz

9108 Dusk Drive

Elkhorn, WI 53121

5,628

J. Edward Clair as Trustee of the J. Edward & Patricia D. Clair Revocable Trust dtd 7/1/2002

3565 Westshire Circle

Delavan, WI 53115Eduardo E. Greco

2,370

Edward Jones Custodian FBO J. Edward Clair IRA

Edward Jones

130 Edward Jones Blvd.

Maryland Heights, MO 63043N. Levato Sr.

4,359

Gregg E. Kunes

N2011 N. Lake Shore Drive

Fontana, WI 53125

3,973

Gregg E. Kunes & Deborah A. Kunes

N2011 N. Lake Shore Drive

Fontana, WI 53125

1,174

Michael J. and Carol J. Murphy, or their Successors, as Trustees of the Michael and Carol Murphy Revocable Living Trust dated 6/22/06, and as it may subsequently be amended *Keith Kotche

2119 Hillcrest Drive

Delavan, WI 53115

 

23,586

*  Michael J. Murphy also owns 7,250

unexercised stock options.

Bank of Sun Prairie Custodian FBO Michael J. Murphy IRA

Bank of Sun Prairie-Kurt Knless

228 E. Main Street

P. O. Box 29

Sun Prairie, WI 53590Gregory Licht

7,469

Thomas R. & Donna J. Neshek Revocable Living Trust dtd 9/27/2006, Thomas & Donna Neshek Trustees

P. O. Box 75

Elkhorn, WI 53121

17,936

James D. Parrilli Jr.

Charles S. Wolande

W. Philip Wilmington

Signature Page to Voting Agreement

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SCHEDULE 1

SHAREHOLDER NAME

RECORD OWNER OF
SHARES

NUMBER OF SHARES
OF COMPANY
COMMON STOCK
OWNED BY
SHAREHOLDER

ADDRESS FOR NOTICES

Anthony V. Sisto

Anthony V. Sisto

34,790

Christopher Woelffer

Christopher Woelffer

5,000

Eduardo E. Greco

Eduardo E. Greco

13,557

Edward D. Jones & Co. Custodian FBO Thomas R. Neshek

201 Progress Parkway

Maryland Heights, MO 63043N. Levato Sr.

1,750

Edward N. Levato Sr. or Darlene Levato

11,500

Darlene Joan Neshek Family Trust, Thomas R. Neshek Trustee

P. O. Box 75

Elkhorn, WI 53121

3,358

Daniella DeMoon and/or Edward N. Levato Sr. (JTWOS)

6,206

Kristen Levato and/or Edward N. Levato Sr. (JTWOS)

7,206

Salvatore R. Levato or Anna Levato or Edward N. Levato Sr.

1,000

Frank A. Levato or Edward N. Levato Sr.

1,000

Edward N. Levato Jr. or Edward N. Levato Sr.

6,206

Keith Kotche

Keith or Joni Kotche (JTWROS)

24,433

Keith Kotche and/or Joni Kotche and/or Drew Kotche (JTWROS)

1,095

Keith Kotche and/or Joni Kotche and/or Victoria Maas (JTWROS)

1,095

Keith Kotche and/or Joni Kotche and/or Margaret Colliander (JTWROS)

1,095

Robert J. Kotche or Eileen Kotche or Keith Kotche

100

Glenn Kotche or Miri Kotche or Keith Kotche

100

Gregory Licht

Gregory Licht

10,000

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James D. Parrilli Jr.

James D. Parrilli Jr.

14,285

Charles Schwab & Co., Inc. Custodian, James R. Saer IRA Rollover

DTTC – Attn: Rosa Hicks-Miller

570 Washington Blvd.

5th Floor Securities

Jersey City, NJ 07310S. Wolande

2,500

Charles S. Wolande

38,819

Charles Schwab & Co., Inc. Custodian, James R. Saer Roth Contributory IRA

DTTC – Attn: Rosa Hicks-Miller

570 Washington Blvd.

5th Floor Securities

Jersey City, NJ 07310

5,000

Charles S. Wolande 2012 Family Trust

4,300

James R. and Marcia P. Saer Revocable Trust dtd 10/10/12, James R. & Marcia P. Saer Co Trustees

2230 LaFontaine Ct.

Brookfield, WI 53045W. Philip Wilmington

13,158

W. Philip or Julie Wilmington (JTWROS)

24,000

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Annex D

GRAPHIC

 

June 5, 2019

LOGO

Investment Banking

October 13, 2014

Board of Directors

DelavanSTC Bancshares Inc.Corp.

830 East Geneva460 South First Street

Delavan, WI 53115Saint Charles, Illinois 60174

The Board

Members of Directors:the Board:

We understand that DelavanSTC Bancshares Inc. (the “Company”Corp. (“Company), proposes to enter into an Agreement and Plan of Merger (the “Agreement”Agreement) with Wintrust Financial Corporation (“Wintrust”Wintrust) and WTFC STCBC Merger Sub LLC, a wholly owned subsidiary of Wintrust (“Merger Co. (“Merger Co.”). Pursuant, pursuant to and as more fully described in the Agreement, (i) thewhich, among other things, Company will be mergedmerge with and into Merger Co. at, as described in Section 1.1 of the Effective TimeAgreement (the “Merger”Merger”). As described further in Section 1.4 of the Agreement, aggregate consideration to be paid in the Merger shall be equal to the product of $100 and the number of shares of Company Common Stock Outstanding (“Merger Consideration) subject to adjustment pursuant to Section 6.9(b). Merger Consideration is intended to be paid 50% in cash and 50% in shares of common stock of Wintrust (“Wintrust Common Stock”), with Merger Co. as$2,500,000 of the surviving corporationcash portion of the Merger Consideration deposited into a special purpose escrow account (“Escrow Amount”) as described in Section 1.10(a) of the Agreement and $400,000 of the Company thereby becoming a wholly-owned subsidiary of Wintrust and, (ii) upon consummationcash portion of the Merger eachConsideration (the “Reserve Amount”) deposited into a special purpose escrow account (the “Reserve Account”) as described in Section 1.10(b) of the Agreement.  Each issued and outstanding share of the Company’s common stock issued and outstanding immediately prior toof the Effective Time willCompany (“Company Common Stock”), shall be converted into the right to receive (i) an amount of cash equal to the equivalentMerger Consideration multiplied by 0.5 minus the Escrow Amount minus the Reserve Amount with the resultant divided by the number of $50.80shares of Company Common Stock Outstanding (“Per Share Cash Consideration”); plus (ii) an amount of cash equal to the portion of the Escrow Amount to be disbursed divided by the number of shares of Company Common Stock Outstanding (“Per Share Escrowed Consideration”) and an amount of cash contained in the Reserve Account to be disbursed divided by the number of shares of Company Common Stock Outstanding (“Per Share Escrowed Consideration”); plus (iii) a number of shares of Wintrust common stock, which based on Wintrust’s closing price on October 10, 2014Common Stock equal to Aggregate Share Amount as defined in the Agreement divided by the number of $43.79 would be 1.16 shares of Wintrust common stock (the “Per Share Stock Consideration”), and $50.80 in cash (the “Per Share Cash Consideration”), together constituting the “Per Share Merger Consideration” of $101.61, subject to 373,989 shares of Company common stock outstanding immediately prior to the Effective TimeCommon Stock Outstanding multiplied by 0.5 (“Per Share Stock Consideration”), (combined “Per Share Merger Consideration”).  The terms and certain potential adjustments thereto as specified in the Agreement. The termsconditions of the Merger are more fully describedset forth in the Agreement.

Capitalized terms used herein without definitions shalldefinition have the respective meanings givenascribed to such termsthem in the Agreement.

In connection with your consideration of the Merger, the Board of Directors (the “Board”) of the Company (solely in its capacity as such) has

You have requested theour opinion of Robert W. Baird & Co. Incorporated (“Baird”) as to the fairness, from a financial point of view, to the holders of the Company’s common stockCompany Common Stock of the Per Share Merger Consideration set forthto be paid to such holders in the Agreement. We express no opinion about the fairness of any amount or nature of the compensation or consideration to be received by any of the Company’s officers, directors or employees, or any class of such persons, or to any particular stockholder or group of stockholders in the Merger. You have not asked us to express, and we are not expressing, any opinion with respect to any of the other financial or non-financial terms, conditions, determinations or actions with respect to theproposed Merger.

Baird, as part of its investment banking business, is regularly engaged in the valuation of financial institutions and their securities in

In connection with mergers and acquisitions and other corporate transactions. In conducting our financial analyses and in arriving atpreparing our opinion, we have reviewed, such informationamong other things:

(i)                                     a draft of the Agreement, dated June 4, 2019;

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(ii)           certain financial statements and have taken into account suchother historical financial and economic factors, investment banking proceduresbusiness information about Wintrust and considerations as we have deemed relevant underCompany made available to us from published sources and/or from the circumstances. In that connection, and subject to the various assumptions, qualifications and limitations set forth herein, we have, among other things: (i) reviewed certain internal information, primarily financial in nature, including (A) financial forecasts concerning the business and operationsrecords of the Company (the “Forecasts”) as furnished to us and prepared by the Company’s management for purposes of our analysis, (B) financial statements of the Company for the fiscal years ended December 31, 2011 through 2013, and interim financial statements of the Company for the six months ended June 30, 2014, which the Company’s management has prepared and identified as being the most current financial statements available, and (C) financial statements of Wintrust for the fiscal years ended December 31, 2011 through 2013, and interim financial statements of Wintrust for the six months ended June 30, 2014, obtained from Wintrust’s annual and quarterly reports as filed with the Securities and Exchange Commission (the “SEC”) and publicly available; (ii) reviewedthat we deemed relevant;

(iii)          certain publicly available information, including, but


not limited to, Wintrust’s recent filings with the SEC and equity analyst research reports covering Wintrust prepared by various investment banking and research firms, including consensus earnings estimates for Wintrust for the years ending December 31, 20142019, December 31, 2020 and 2015; (iii) reviewedDecember 31, 2021 and for the principalyears ending December 31, 2022, December 31, 2023, and December 31, 2024 based on growth rate assumptions estimated by us;

(iv)          financial termsprojections for the Company for the years ending December 31, 2019,  December 31, 2020 and December 31, 2021 provided by senior management and for the years ending December 31, 2022, December 31, 2023 and December 31, 2024 based on growth rate assumptions estimated by us and in each case discussed with and confirmed by senior management of the draft dated October 10, 2014 of the Agreement in the form expected to be presented to the Board as they related to our analysis; (iv) considered the relative contributions of assets, liabilities, equity and earnings of the Company and Wintrust to the resulting company; Company;

(v) compared the financial position and operating results of the Company and Wintrust with those of certain publicly traded companies we deemed relevant; (vi) compared the historical market prices, trading activity and market trading multiples of Wintrust’s common stock with those of certain other publicly traded companies we deemed relevant; (vii) compared the Per Share Merger Consideration with the reported financial terms of certain other recent business combinations in the commercial banking industry we deemed relevant, to the extent publicly available; (ix) reviewed certificates from the Company addressed to Baird regarding the historical financial statements and Forecasts; (x) reviewed certain potential pro forma financial effects of the Merger; (xi) reviewed                                 the current market environment generally and the banking environment in particular;

(vi)                              the financial terms of certain other transactions in the financial institutions industry, to the extent publicly available;

(vii)                           the market and (xiii) reviewedtrading characteristics of selected public companies and selected public bank holding companies in particular;

(viii)                        the relative contributions of Wintrust and the Company to the combined company;

(ix)                              the pro forma financial impact of the Merger, taking into consideration the amounts and timing of the merger costs and cost savings; and

(x)                                 such other information, financial studies, analyses and investigations and financial, economic and market criteria and other information as we considered relevant. We have heldrelevant including discussions with membersmanagement and other representatives and advisors of Wintrust and the Company’s and Wintrust’s respective senior managementsCompany concerning the historical and current business, financial condition, operating results of operations and prospects of the CompanyWintrust and Wintrust, respectively. Wethe Company.

In connection with our engagement, we have also considered such other information, financial studies, analysesbeen authorized to solicit, and investigations and financial, economic and market criteria which we deemed relevant forhave solicited expressions of interest from parties with respect to a sale of the preparation of this opinion.Company.

In arriving at our opinion, we have, with your consent, assumed and relied upon without independent verification, the accuracy and completeness of all of the financial and other information that was publicly available or providedsupplied or otherwise made available to, usdiscussed with or reviewed by or on behalf of the Company and Wintrust.for us. We have furthernot independently verified (nor have we assumed responsibility for independently verifying) such information or its accuracy or completeness. We have relied on the assurances of the management of the Company that they areit is not aware of any facts or circumstances that would make any of such information inaccurate or misleading. We have not been asked to and have not independently verified any publicly available informationundertaken or information supplied to us by the Company or Wintrust. We have not been engaged to independently verify, have not assumed any responsibility to verify, assume no liability for, and express no opinion on, any such information, and we have assumed and relied upon, without independent verification, that neither the Company nor Wintrust is aware of any information that might be material to our opinion that has not been provided to us. We have assumed and relied upon, without independent verification, that: (i) all material assets and liabilities (contingent or otherwise, known or unknown) of the Company and Wintrust are as set forth in their respective most recent financial statements provided to us or publicly available, and there is no information or facts that would makewith any of the information reviewed by us incomplete or misleading; (ii) the financial statements of the Company and Wintrust provided to us or publicly available present fairly the results of operations, cash flows and financial condition of the Company and Wintrust, respectively, for the periods, and as of the dates, indicated and were prepared in conformity with U.S. generally accepted accounting principles consistently applied; (iii) the Forecasts for the Company were reasonably prepared on bases reflecting the best available estimates and good faith judgments of the Company’s senior management as to the future performance of the Company, and we have relied, without independent verification, upon such Forecasts in the preparation of this opinion, although we express no opinion with respect to the Forecasts or any judgments, estimates, assumptions or basis on which they were based, and we have assumed, without independent verification, that the Forecasts used in our analysis will be realized in the amounts and on the time schedule contemplated; (iv) the Merger will be consummated in accordance with the terms and conditions of the Agreement without any amendment or modification thereto and without waiver by any party of any of the conditions to their respective obligations thereunder; (v) the representations and warranties contained in the Agreement are true and correct and that each party will perform all of the covenants and agreements required to be performed by it under the Agreement; (vi) all corporate, governmental, regulatory or other consents and approvals (contractual or otherwise) required to consummate the Merger have been, or will be, obtained without the need for any changes to the Per Share Merger Consideration or other financial terms or conditions of the Merger or that would otherwise materially affect the Company or Wintrust or our analysis; (vii) the Merger will be treated as a tax-free reorganization for U.S. federal income tax purposes; and (viii) with respect to the equity analyst research reports and consensus earnings estimates referred to above, we have reviewed and discussed such forecasts and projections with the management of Wintrust and have assumed, without independent verification, that such forecasts and projections represent reasonable estimates and judgments of the future financial results and condition of Wintrust, and we express no opinion with respect to such forecasts and projections or the assumptions on which they are based. We have relied upon and assumed, without independent verification, that the final form of any draft documents referred to above will not differ in any material respect from such draft documents. We have relied,

without independent verification, as to all legal, regulatory, accounting, insurance and tax matters regarding the Merger on the advice of the Company and its professional advisors, and we have assumed that all such advice was correct. In conducting our review, we have not undertaken or obtained an independent evaluation or appraisal of any of the assets or liabilities (contingent or otherwise, known or unknown) or solvencyotherwise) of the Company or WintrustWintrust. In addition, we have not assumed any obligation to conduct, nor have we made aconducted, any physical inspection of the properties or facilities of the Company or Wintrust.Wintrust, and have not been provided with any reports of such physical inspections. We renderhave assumed that there has been no material change in Company’s or Wintrust’s business, assets, financial condition, results of operations, cash flows or prospects since the date of the most recent financial statements provided to us.

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With respect to the financial projections and other estimates provided to or otherwise reviewed by or for or discussed with us, we have been advised by management of the Company, and have assumed with your consent, that such projections and estimates were reasonably prepared on bases reflecting the best currently available estimates and good faith judgments of management of the Company as to the future financial performance of the Company. We assume no responsibility for and express no opinion as to such projections, estimates or the assumptions on which they were based.

We are not experts in the evaluation onof loan and lease portfolios, classified loans or other real estate owned or in assessing the collectabilityadequacy of the allowance for loan losses with respect thereto, and we did not make an independent evaluation or appraisal thereof, or of any other specific assets, the collateral securing assets or the future performanceliabilities (contingent or otherwise) of the Company or Wintrust or any loansof their respective subsidiaries. We have not reviewed any individual loan or credit files relating to Company or Wintrust. We have assumed, with your consent, that the respective allowances for loan and lease losses for both the Company and Wintrust are adequate to cover such losses. We did not make an independent evaluation of the quality of the Company’s or Wintrust’s deposit base, nor have we independently evaluated potential deposit concentrations or the deposit composition of the Company or Wintrust. We did not make an independent evaluation of the adequacyquality of the allowanceCompany’s or Wintrust’s investment securities portfolio, nor have we independently evaluated potential concentrations in the investment securities portfolio of the Company or Wintrust.

We have assumed that all of the representations and warranties contained in the Agreement and all related agreements are true and correct in all respects material to our analysis, and that the Merger and related transactions will be consummated in accordance with the terms of the Agreement, without waiver, modification or amendment of any term, condition or covenant thereof the effect of which would be in any respect material to our analysis. We also have assumed that all material governmental, regulatory or other consents, approvals, and waivers necessary for loan lossesthe consummation of the Merger and related transactions will be obtained without any material adverse effect on the Company or Wintrust or the contemplated benefits of the Merger. Further, we have assumed that the executed Agreement will not differ in any material respect from the draft Agreement, dated June 4, 2019, reviewed by us.

We have assumed in all respects material to our analysis that the Company and Wintrust will remain as a going concern for all periods relevant to our analysis. We express no opinion regarding the liquidation value of the Company, or Wintrust or the combined entity after the Merger and we have not reviewed any individual credit files relatingother entity.

Our opinion is limited to the Company or Wintrust. We have assumed that the respective allowances for loan losses for both the Company and Wintrust, together with the assumed purchase accounting adjustments made by Wintrust with respect to the Company, are adequate to cover such losses and will be adequate onfairness, from a pro forma basis for the combined entity. We have not considered any expenses or potential adjustments to the Per Share Merger Consideration relating to the Merger as partfinancial point of our analysis. We have also assumed the value of the Per Share Stock Consideration to be $50.80 and thus the valueview, of the Per Share Merger Consideration to be $101.61.paid to holders of the Company Common Stock in the proposed Merger. We do not express any view on, and our opinion does not address, any other term or aspect of the Agreement, the Merger (including, without limitation, the form or structure of the Merger) or any related transaction or any term or aspect of any other agreement or instrument contemplated by the Agreement or entered into in connection with the Merger, or as to the underlying business decision by the Company to engage in the Merger. Furthermore, we express no opinion with respect to the amount or nature of any compensation to any officers, directors or employees of the Company, Wintrust, or any class of such persons, relative to the compensation to be paid to the holders of Company Common Stock in the Merger, or with respect to the fairness of any such compensation to Wintrust.

We express no view as to, and our opinion does not address, the relative merits of the Merger as compared to any alternative business transactions or strategies, or whether such alternative transactions or strategies could be achieved or are available. In each case above,addition, our opinion does not address any legal, regulatory, tax or accounting matters, as to which we understand that the Company obtained such advice as it deemed necessary from qualified professionals.

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We express no opinion as to the actual value of Wintrust Common Stock when issued in the Merger or the prices at which the Company Common Stock or Wintrust Common Stock will trade following announcement of the Merger or at any future time.

We have not evaluated the solvency or fair value of the Company or Wintrust under any state, federal or other laws relating to bankruptcy, insolvency or similar matters. This opinion is not a solvency opinion and does not in any way address the solvency or financial condition of the Company or Wintrust. We are not expressing any opinion as to the impact of the Merger on the solvency or viability of the Company or Wintrust or the ability of the Company or Wintrust to pay their respective obligations when they come due.

We have acted as the Company’s financial advisor in connection with the Merger and will receive a fee for our services, a portion of which is payable upon the rendering of this opinion and a significant portion of which is contingent upon consummation of the Merger.  In addition, the Company has agreed to reimburse our reasonable expenses and indemnify us against certain liabilities arising out of our engagement.

In the ordinary course of our business, D.A. Davidson & Co. and its affiliates may actively trade or hold securities of the Company or Wintrust for our own accounts or for the accounts of our customers and, accordingly, may at any time hold long or short positions in such securities. We may seek to provide investment banking or other financial services to the Company or Wintrust in the future for which we would expect to receive compensation.

This fairness opinion was reviewed and approved by a D.A. Davidson & Co. Fairness Opinion Committee.

This opinion is solely for the information of the Board of Directors of the Company (solely in its capacity as such) in connection with its consideration of the Merger and shall not be disclosed, referred to, published or otherwise used (in whole or in part), nor shall any public references to us be made, without our prior written consent, except that a copy of this opinion may be included in its entirety in any regulatory filing that Wintrust is required to make in connection with the assumptionsMerger if such inclusion is required by applicable law. This opinion is not intended to be and takendoes not constitute a recommendation as to how the actionsshareholder of the Company should vote or inactions described aboveact with your knowledge and consent.respect to the Merger or any matter relating thereto.

Our opinion is necessarily is based upon financial,on economic, monetary, market and other conditions as in effect on, and the information made available to us as of, the date hereof, and our opinion does not predict or take into account any changes or events which may occur, or information which may become available,hereof. Events occurring after the date hereof. We are under nohereof may affect this opinion and the assumptions used in preparing it, and we do not assume any obligation to update, revise or reaffirm or withdraw this opinion, or otherwise comment on or consider events occurring after the date hereof. Furthermore, we express no opinion as to the price or trading range at which any of Wintrust’s securities (including Wintrust’s common stock) will trade following the date hereof or as to the effect of the Merger on such price or trading range, or any earnings or ownership dilutive impact that may result from Wintrust’s issuance of its common stock in the Merger. Such price and trading range may be affected by a number of factors, including but not limited to (i) dispositions of the common stock of Wintrust by shareholders within a short period of time after, or other market effects resulting from, the announcement and/or effective date of the Merger; (ii) changes in prevailing interest rates and other factors which generally influence the price of securities; (iii) adverse changes in the current capital markets; (iv) the occurrence of adverse changes in the financial condition, business, assets, results of operations or prospects of the Company or Wintrust or in the financial services industry; (v) any actions or inactions by, or restrictions of, federal, state or other governmental agencies or regulatory authorities; and (vi) timely completion of the Merger on terms and conditions that are acceptable to all parties at interest. We also do not express any opinion on the liquidity or marketability of the Wintrust common stock or the ability of the holders of such stock, including the holders of the Company’s common stock who will receive shares of Wintrust common stock in the Merger, to sell shares of Wintrust common stock at any time.opinion.

Our opinion has been prepared at the request and for the information of and is directed to the Board of Directors of the Company in connection with its consideration of the Merger, and is directed only to the fairness, from a financial point of view, as of the date hereof, of the Per Share Merger Consideration to the holders of the Company’s common stock. This opinion does not address the relative merits or risks of: (i) the Merger, the Agreement or any other agreements or other matters provided for, or contemplated by, the Agreement; (ii) any other transactions that may be, or might have been, available as an alternative to the Merger; or (iii) the Merger compared to any other potential alternative transactions or business strategies considered by the Board and, accordingly, we have relied upon our discussions with the senior management of the Company with respect to the availability and consequences of any alternatives to the Merger. This opinion does not constitute a recommendation to the Board, any security holder or any other person as to how any such person should vote or act with respect to the Merger. This opinion is not to be quoted or referred to, in whole or in part, in a registration statement, prospectus, proxy statement, or in any other document, nor shall this opinion be used for any other purposes, without Baird’s prior written consent.

We have acted as financial advisor to the Company in connection with the Merger and will receive a fee (a “Transaction Fee”) for our services, a significant portion of which is contingent upon the consummation of the Merger. We will receive a separate fee for rendering this opinion, which fee is not contingent upon the conclusions of our opinion or the consummation of the Merger, but is fully creditable against the Transaction Fee (if paid). In addition, the Company has agreed to reimburse us for certain of our expenses and to indemnify us and certain related parties against certain liabilities that may arise out of our engagement. We will not receive any other significant payment or compensation contingent upon the successful completion of the Merger.

Except as disclosed in the prior paragraph, during the last two years, neither Baird nor any of its affiliates have provided investment banking and/or financial advisory services to either the Company or Wintrust, or any affiliates thereof, for which Baird received compensation. Baird has in the past acted, and may in the future act, as a market maker for Wintrust’s common stock. Baird also has in the past from time to time prepared, and may in the future prepare, equity analyst research reports regarding Wintrust. During the past two years, Baird has acted as agent or principal with respect to securities transactions effected for the accounts of Wintrust (and their respective subsidiaries and affiliates), for which Baird received standard commissions, markups/markdowns or other remuneration. In addition, certain officers, directors, employees and affiliates of the Company or Wintrust may have brokerage or investment accounts with Baird, for which Baird receives customary commissions or fees. No material relationship between the Company, Wintrust or any other party or affiliate to the Merger is mutually understood to be contemplated in which any compensation is intended to be received by Baird.

In the ordinary course of business, Baird may from time to time provide investment banking, advisory, brokerage and other services to clients that may be competitors or suppliers to, or customers or security holders of, the Company or Wintrust or any other party that may be involved in the Merger and their respective affiliates or that may otherwise participate or be involved in the same or a similar business or industry as the Company or Wintrust. In addition, Baird may from time to time hold or trade the securities of Wintrust (including Wintrust’s common stock) for their own account or the accounts of our customers and, accordingly, may at any time hold long or short positions or effect transactions in such securities.

Our opinion was approved by our firm’s internal fairness opinion committee.

Based upon and subject to the foregoing, including the various assumptions, qualifications and limitations set forth herein, we are of theit is our opinion that, as of the date hereof, the Per Share Merger Consideration to be paid to the holders of the Company Common Stock in the Merger is fair, from a financial point of view, to the holders of the Company’s common stock.such holders.

 

Very truly yours,

/s/ Robert W. Baird & Co. Incorporated
ROBERT W. BAIRD & CO. INCORPORATED

D.A. Davidson & Co.

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PART II

Information Not Required in Prospectus

 

Item 20.Indemnification of Officers and Directors.

Item 20.Indemnification of Officers and Directors.

Section 8.75 of the IBCA provides generally and in pertinent parts that an Illinois corporation may indemnify its directors, officers, employees and agents, or anyone serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (in the case of actions by or in the right of the corporation) or against expenses, judgments, fines, and settlements (in all other cases) actually and reasonably incurred by them in connection with any action, suit, or proceeding if, in connection with the matters in issue, they acted in good faith and in a manner they reasonably believed to be in, or not opposed to, the best interests of the corporation and, in connection with any criminal suit or proceeding, if in connection with the matters in issue, they had no reasonable cause to believe their conduct was unlawful, provided that no indemnification shall be made with respect to any claim, issue, or matter as to which such person has been adjudged to have been liable to the corporation, unless and only to the extent that the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability, such person is fairly and reasonably entitled to indemnity. If a present or former director, officer or employee of an Illinois corporation has been successful in the defense of any such action, suit or proceeding, claim, issue or matter, such person shall be indemnified by the corporation against expenses.

Section 8.75 of the IBCA further permits an Illinois corporation to pay expenses incurred by an officer or director in defending a civil or criminal action, suit or proceeding in advance of the final disposition of such action, suit or proceeding if the director or officer undertakes to repay such amount if it is ultimately determined that such person is not entitled to be indemnified by the corporation. An Illinois corporation may also grant additional indemnification through its by-laws, agreements, votes of shareholders or disinterested directors, or otherwise, and may purchase and maintain insurance on behalf of any indemnifiable person against any liability asserted against such person and incurred by such person in his or her capacity as an indemnifiable person whether or not the corporation would have the power to indemnify such person against liability under the terms of Section 8.75 of the IBCA.

Article NINTHNINE of Wintrust’s amended and restated articles of incorporation, as amended, and Article VI of Wintrust’s amended and restated by-laws provide that Wintrust shall, to the full extent permitted by law, indemnify those persons whom Wintrust may indemnify pursuant thereto, and contain provisions substantially similar to Section 8.75 of the IBCA.

Wintrust has entered into individual indemnification agreements with each of its non-employee directors and certain of its executive officers, which we refer to collectively as the indemnification agreements, which implement with more specificity the indemnification provisions provided by Wintrust’s by-laws and provide, among other things, that to the fullest extent permitted by applicable law, Wintrust will indemnify such director or officer against any and all losses, expenses and liabilities arising out of such director’s or officer’s service as a director or officer of Wintrust, as the case may be. The indemnification agreements also contain detailed provisions concerning expense advancement and reimbursement. The indemnification agreements are in addition to any other rights each non-employee director or officer may be entitled to under Wintrust’s articles of incorporation, by-laws and applicable law.

Wintrust maintains insurance policies under which its directors and officers are insured, within the limits and subject to the limitations of the policies, against certain expenses in connection with the defense of actions, suits or proceedings, and certain liabilities which might be imposed as a result of such actions, suits or proceedings, to which they are parties by reason of being or having been such directors or officers.

Item 21.Exhibits and Financial Statement Schedules.

 

II-1(a)           Exhibits:

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Item 21.Exhibits and Financial Statement Schedules.

(a) Exhibits:Table of Contents

 

Exhibit
Number

Description of Exhibit

Exhibit
Number
2.1*

Description of Exhibit

  2.1†Agreement and Plan of Merger by and among Wintrust Financial Corporation, WintrustWTFC STCBC Merger Co.Sub LLC and DelavanSTC Bancshares Inc.Corp., dated as of October 13, 2014,June 5, 2019 (included as amended by Amendment No. 1 (included asAnnex AA-1 to this proxy statement/prospectus).

  3.1

2.2

Amendment to the Agreement and Plan of Merger by and among Wintrust Financial Corporation, WTFC STCBC Merger Sub LLC and STC Bancshares Corp., dated as of July 1, 2019 (included as Annex A-2 to this proxy statement/prospectus).

3.1

Amended and Restated Articles of Incorporation of Wintrust Financial Corporation, as amended (incorporated by reference to Exhibit 3.1 of Wintrust’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2006, Exhibits 3.1 and 3.2 of Wintrust’s Current Report on Form 8-K filed with the SEC on July 29, 2011 and Exhibit 3.1 of Wintrust’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2012)2012).

3.2

Amended and Restated

Certificate of Designations of Wintrust Financial Corporation filed on December 18, 2008June 24, 2015 with the Secretary of State of the State of Illinois designating the preferences, limitations, voting powers and relative rights of the Series A Preferred Stock (incorporated by reference to Exhibit 3.2 of Wintrust’s Current Report on Form 8-K filed with the SEC on December 24, 2008).

  3.3Certificate of Designations of Wintrust Financial Corporation filed on March 15, 2012 with the Secretary of State of the State of Illinois designating the preferences, limitations, voting powers and relative rights of the Series CD Preferred Stock (incorporated by reference to Exhibit 3.1 of Wintrust’s Current Report on Form 8-K filed with the SEC on March 19, 2012)June 25, 2015).

  3.4

3.3

Amended and Restated By-laws of Wintrust Financial Corporation, as amended (incorporated by reference to Exhibit 3.2 of Wintrust’s Current Report on Form 8-K filed with the SEC on April 15, 2011)May 26, 2017).

5.1**

Opinion of Lisa J. Pattis, Esq.Kathleen M. Boege.

8.1**

Tax Opinion of WIPFLI,Barack Ferrazzano Kirschbaum & Nagelberg LLP.

23.1**

Consent of Ernst & Young LLP.

23.2**

Consent of Robert W. BairdD.A. Davidson & Co. Incorporated.

23.3**

Consent of Lisa J. Pattis, Esq.Kathleen M. Boege (included in Exhibit 5.1).

23.4**

Consent of WIPFLI,Barack Ferrazzano Kirschbaum & Nagelberg LLP (included in Exhibit 8.1).

24.1**

Power of Attorney (contained in signature page to this Registration Statement).

99.1**

Form of proxy card.

 

*Filed herewith
**Previously filed
Disclosure schedules have been omitted pursuant to Item 601(b)(2) of Regulation S-K. Wintrust undertakes to furnish supplementally to the SEC, upon request, a copy of any omitted schedule.

* Disclosure schedules and certain exhibits have been omitted pursuant to Item 601(b)(2) of Regulation S-K.  Wintrust undertakes to furnish supplementally to the SEC, upon request, a copy of any omitted schedule or exhibit.

** Filed herewith

(b)           Financial Statement Schedules:

All schedules for which provision is made in the applicable accounting regulations of the SEC have been omitted because they are not required, amounts which would otherwise be required to be shown with respect to any item are not material, are inapplicable or the required information has already been provided elsewhere or incorporated by reference in the registration statement.

Item 22:Undertakings.

 

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Item 22:Undertakings.

(a)           The undersigned registrant hereby undertakes:

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(1)           To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:

(i)            To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;

(ii)           To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20 percent change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement;

(iii)          To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement.

(2)           That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initialbona fideoffering thereof.

(3)           To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.

(b)           The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the registrant’s annual report pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 as amended (and, where applicable, each filing of an employee benefit plan’s annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934), that is incorporated by reference in this Registration Statement shall be deemed to be a new registration statement relating to the securities offered herein,therein, and the offering of such securities at that time shall be deemed to be the initialbona fideoffering thereof.

(c)

(1)           The undersigned registrant hereby undertakes as follows: that prior to any public reoffering of the securities registered hereunder through use of a prospectus which is a part of this registration statement, by any person or party who is deemed to be an underwriter within the meaning of Rule 145(c), the issuer undertakes that such reoffering prospectus will contain the information called for by the applicable registration form with respect to reofferings by persons who may be deemed underwriters, in addition to the information called for by the other items of the applicable form.

(2)           The undersigned registrant undertakes that every prospectus: (i) that is filed pursuant to paragraph (1) immediately preceding, or (ii) that purports to meet the requirements of Section 10(a)(3) of the Securities Act of 1933 and is used in connection with an offering of securities subject to Rule 415, will be filed as a part of an amendment to thisthe registration statement and will not be used until such amendment is effective, and that, for purposes of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initialbona fideoffering thereof.

(d)           Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the

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registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

(e)           The undersigned registrant hereby undertakes to respond to requests for information that is incorporated by reference into the prospectus pursuant to ItemItems 4, 10(b), 11, or 13 of this form,Form, within one business day of receipt of such request, and to send the incorporated documents by first class mail or other equally prompt means. This includes information contained in documents filed subsequent to the effective date of the registration statement through the date of responding to the request.

(f)            The undersigned registrant hereby undertakes to supply by means of a post-effective amendment all information concerning a transaction, and the company being acquired involved therein, that was not the subject of and included in the registration statement when it became effective.

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II-4SIGNATURES


SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended, the registrant has duly caused this Amendment No. 1 to the Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Rosemont, State of Illinois, on this 26th8th day of November, 2014.July, 2019.

 

WINTRUST FINANCIAL CORPORATION

By:

By:

/s/ Lisa J. PattisKathleen M. Boege

Lisa J. Pattis

Kathleen M. Boege

Executive Vice President, General Counsel and

Corporate Secretary

POWER OF ATTORNEY

Each person whose signature appears below constitutes and appoints each of David A. Dykstra and Kathleen M. Boege, with full power to act without the other, his or her true and lawful attorney-in-fact and agent, with full and several power of substitution, for him or her and in his or her name, place and stead, in any and all capacities, to sign any or all amendments, including post-effective amendments to this registration statement and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission and any applicable securities exchange or securities self-regulatory body, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as they or he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents as his, her or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act of 1933, as amended, this Amendment No. 1 to the Registration Statement has been signed by the following persons in the capacities and on the date indicated.

 

Name

Title

NameTitle

Date

*

/s/ Edward J. Wehmer

President, Chief Executive

July 8, 2019

Edward J. Wehmer

Officer and Director
(Principal Executive Officer)

November 26, 2014

*

/s/ David L. Stoehr

Executive Vice President and

July 8, 2019

David L. Stoehr

and Chief Financial Officer


(Principal Financial and Accounting Officer)

November 26, 2014

*

/s/ H. Patrick Hackett, Jr.

Chairman of the Board of Directors

November 26, 2014
Peter D. Crist

July 8, 2019

*

DirectorNovember 26, 2014
Bruce K. Crowther

*

DirectorNovember 26, 2014
Joseph F. Damico

*

DirectorNovember 26, 2014
Bert A. Getz, Jr.

*

DirectorNovember 26, 2014
H. Patrick Hackett, Jr.

*

Director

November 26, 2014

/s/ Peter D. Crist

Director

July 8, 2019

Peter D. Crist

/s/ Bruce K. Crowther

Director

July 8, 2019

Bruce K. Crowther

/s/ William J. Doyle

Director

July 8, 2019

William J. Doyle

/s/ Marla F. Glabe

Director

July 8, 2019

Marla F. Glabe

/s/ Scott K. Heitmann

Director

July 8, 2019

*Scott K. Heitmann

Director

November 26, 2014
Charles H. James III

*

Director

November 26, 2014
Albin F. Moschner

*/s/ Deborah L Hall Lefevre

Director

November 26, 2014
Thomas J. Neis

July 8, 2019

*Deborah L. Hall Lefevre

Director

November 26, 2014


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Name

Title

Date

/s/ Christopher J. Perry

Director

July 8, 2019

*Christopher J. Perry

Director

November 26, 2014

/s/ Ingrid S. Stafford

Director

July 8, 2019

*Ingrid S. Stafford

Director

November 26, 2014

Sheila G. Talton

 

By:

/s/ Lisa J. PattisGary D. “Joe” Sweeney

Director

July 8, 2019

Gary D. “Joe” Sweeney

Lisa J. Pattis
Attorney-in-fact

INDEX TO EXHIBITS

 

Exhibit
Number

Description of Exhibit

/s/ Karin Gustafson Teglia

Director

July 8, 2019

  2.1†

Karin Gustafson Teglia

Agreement and Plan of Merger by and among Wintrust Financial Corporation, Wintrust Merger Co. and Delavan Bancshares, Inc., dated as of October 13, 2014, as amended by Amendment No. 1 (included asAnnex A to this proxy statement/prospectus).

  3.1

Amended and Restated Articles of Incorporation of Wintrust Financial Corporation, as amended (incorporated by reference to Exhibit 3.1 of Wintrust’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2006, Exhibits 3.1 and 3.2 of Wintrust’s Current Report on Form 8-K filed with the SEC on July 29, 2011 and Exhibit 3.1 of Wintrust’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2012).
  3.2Amended and Restated Certificate of Designations of Wintrust Financial Corporation filed on December 18, 2008 with the Secretary of State of the State of Illinois designating the preferences, limitations, voting powers and relative rights of the Series A Preferred Stock (incorporated by reference to Exhibit 3.2 of Wintrust’s Current Report on Form 8-K filed with the SEC on December 24, 2008).
  3.3Certificate of Designations of Wintrust Financial Corporation filed on March 15, 2012 with the Secretary of State of the State of Illinois designating the preferences, limitations, voting powers and relative rights of the Series C Preferred Stock (incorporated by reference to Exhibit 3.1 of Wintrust’s Current Report on Form 8-K filed with the SEC on March 19, 2012).
  3.4Amended and Restated By-laws of Wintrust Financial Corporation, as amended (incorporated by reference to Exhibit 3.2 of Wintrust’s Current Report on Form 8-K filed with the SEC on April 15, 2011).
  5.1**Opinion of Lisa J. Pattis, Esq.
  8.1**Tax Opinion of WIPFLI, LLP.
23.1*Consent of Ernst & Young LLP.
23.2**Consent of Robert W. Baird & Co. Incorporated.
23.3**Consent of Lisa J. Pattis, Esq. (included in Exhibit 5.1).
23.4**Consent of WIPFLI, LLP (included in Exhibit 8.1).
24.1**Power of Attorney (contained in signature page to this Registration Statement).
99.1*Form of proxy card.

 

*Filed herewith
**Previously filed
Disclosure schedules have been omitted pursuant to Item 601(b)(2) of Regulation S-K. Wintrust undertakes to furnish supplementally to the SEC, upon request, a copy of any omitted schedule.

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