sch13d_02142014.htm

0000950138-14-000181.txt : 20140218 0000950138-14-000181.hdr.sgml : 20140217 20140218111133 ACCESSION NUMBER: 0000950138-14-000181 CONFORMED SUBMISSION TYPE: SC 13D PUBLIC DOCUMENT COUNT: 3 FILED AS OF DATE: 20140218 DATE AS OF CHANGE: 20140218 GROUP MEMBERS: STIFEL FINANCIAL CORP. GROUP MEMBERS: STIFEL VENTURE CORP. SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: CM Finance Inc CENTRAL INDEX KEY: 0001578348 IRS NUMBER: 462883380 STATE OF INCORPORATION: MD FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: SC 13D SEC ACT: 1934 Act SEC FILE NUMBER: 005-88002 FILM NUMBER: 14620957 BUSINESS ADDRESS: STREET 1: 399 PARK AVENUE, 39TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10022 BUSINESS PHONE: 212-388-5813 MAIL ADDRESS: STREET 1: 399 PARK AVENUE, 39TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10022 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: STIFEL FINANCIAL CORP CENTRAL INDEX KEY: 0000720672 STANDARD INDUSTRIAL CLASSIFICATION: SECURITY BROKERS, DEALERS & FLOTATION COMPANIES [6211] IRS NUMBER: 431273600 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D BUSINESS ADDRESS: STREET 1: ATTN: JAMES G. LASCHOBER STREET 2: 501 N. BROADWAY CITY: ST. LOUIS STATE: MO ZIP: 63102-2102 BUSINESS PHONE: 314-342-2000 MAIL ADDRESS: STREET 1: ATTN: JAMES G. LASCHOBER STREET 2: 501 N. BROADWAY CITY: ST. LOUIS STATE: MO ZIP: 63102-2102 SC 13D 1 sch13d_02142014.htm sch13d_02142014.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

SCHEDULE 13D

Under the Securities Exchange Act of 1934

(Amendment No. ___)*

CM FINANCE INC

(Name of Issuer)

Common Stock, $0.001 par value per share

(Title of Class of Securities)

12574Q103

(CUSIP Number)

Bryan Cave LLP

One Metropolitan Square

211 North Broadway, Suite 3600

St. Louis, Missouri 63102

Attention: Robert J. Endicott

Telephone: (314) 259-2000

(Name, Address and Telephone Number of Person Authorized to

Receive Notices and Communications)

February 5, 2014

(Date of Event Which Requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box. □

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See §240.13d-7 for other parties to whom copies are to be sent.

*The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act.


1	NAMES OF REPORTING PERSONS Stifel Financial Corp.

2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
		(a)o
		(b)x

3	SEC USE ONLY

4	SOURCE OF FUNDS

	WC
5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e) □


6	CITIZENSHIP OR PLACE OF ORGANIZATION

	Delaware

NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH	7	SOLE VOTING POWER

		2,181,8181
	8	SHARED VOTING POWER

		0
	9	SOLE DISPOSITIVE POWER

		2,181,8181
	10	SHARED DISPOSITIVE POWER

		0

11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

	2,181,8181
12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES	□

13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

	17.2%2
14	TYPE OF REPORTING PERSON

	HC

1	All such shares are owned directly by Stifel Venture Corp., which is a direct wholly-owned subsidiary of Stifel Financial Corp.

2	The calculation of the foregoing percentage is based on 12,666,666 common shares outstanding upon completion of the Issuer’s initial public offering (“IPO”), based on the Issuer’s prospectus filed with the Securities and Exchange Commission (the “SEC”) on February 6, 2014.


1	NAMES OF REPORTING PERSONS Stifel Venture Corp.

2	CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
		(a)o
		(b)x

3	SEC USE ONLY

4	SOURCE OF FUNDS

	AF
5	CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) OR 2(e) □


6	CITIZENSHIP OR PLACE OF ORGANIZATION

	Missouri

NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH	7	SOLE VOTING POWER

		2,181,818
	8	SHARED VOTING POWER

		0
	9	SOLE DISPOSITIVE POWER

		2,181,818
	10	SHARED DISPOSITIVE POWER

		0

11	AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

	2,181,818
12	CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES	□

13	PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

	17.2%3
14	TYPE OF REPORTING PERSON

	CO

3	The calculation of the foregoing percentage is based on 12,666,666 common shares outstanding upon completion of the Issuer’s IPO, based on the Issuer’s prospectus filed with the SEC on February 6, 2014.

Item 1.

Security and Issuer.

This Schedule 13D (the “Statement”) relates to the common stock, par value $0.001 per share (the “Common Stock”) of CM Finance Inc, a Maryland corporation, with its principal executive offices located at 399 Park Avenue, 39th Floor, New York, New York 10022 (“CM Finance”). Information given in response to each item shall be deemed incorporated by reference in all other items, as applicable.

Item 2.

Identity and Background.

(a)	This statement is being filed by jointly by Stifel Financial Corp. (“Stifel Financial”) and Stifel Venture Corp. (“Stifel Venture,” and together with Stifel, the “Reporting Persons”).

(b)	The address of the principal business address for each of the Reporting Persons is One Financial Plaza, 501 North Broadway, St. Louis, Missouri 63102.

(c)	Stifel Financial is a financial holding company that operates as a retail and institutional brokerage, and investment banking company in the United States and internationally.

Stifel Venture is a wholly-owned subsidiary of Stifel Financial Corp., which operates as a holding company for venture capital investments.

The information required by instruction C to Schedule 13D with respect to the executive officers and directors of each of the Reporting Persons (the “Executive Officers and Directors”) is set forth below. Except as otherwise indicated, the principal occupation of the Executive Officers and Directors are with the Reporting Person, and the principal business address for the Executive Officers and Directors is the address reported for the Reporting Person under Item 2(b) above.

A. Stifel Financial

Executive Officers:

Ronald J. Kruszewski, Chairman of the Board, President and Chief Executive Officer

Thomas W. Weisel, Chairman of the Board

James M. Zemlyak, Senior Vice President and Chief Financial Officer

Bernard N. Burkemper, Senior Vice President, Treasurer and Controller

S. Chad Estep, Senior Vice President

Richard J. Himelfarb, Vice Chairman and Senior Vice President

Thomas B. Michaud, Senior Vice President

David M. Minnick, Senior Vice President and General Counsel

Thomas P. Mulroy, Senior Vice President

Victor J. Nesi, Senior Vice President

Ben A. Plotkin, Vice Chairman and Senior Vice President

David D. Sliney, Senior Vice President

Directors:

Ronald J. Kruszewski

James M. Zemlyak

Bruce A. Beda (principal occupation: Chief Executive Officer, Kilbourn Capital

Management, LLC, a financial asset manager, The John Hancock Center, 875 North Michigan Avenue, 31st Floor, Chicago, IL 60611)

Michael W. Brown (principal occupation: retired; address: c/o Morrow Executive

Services, 14509 SW Peavine Road, McMinnville, OR 97128)

Charles A. Dill (principal occupation: Managing Partner, Two Rivers Associates, a

private equity firm, 9909 Clayton Road, Suite 107, St. Louis, MO 63124)

John P. Dubinsky (principal occupation: President and Chief Executive Officer,

Westmoreland Associates, LLC, a financial consulting company, 7777 Bonhomme, Suite 1210, Clayton, MO 63105)

Robert E. Grady (principal occupation: Partner and Managing Director, Cheyenne

Capital Fund, a private equity investment firm, 1430 Wynkoop Street, Suite 200, Denver, CO 80202)

Frederick O. Hanser (principal occupation: Director, SLC Holdings, LLC, the

manager and holding company for the St. Louis Cardinals, LLC, 700 Clark Street, St. Louis, MO 63102)

Richard J. Himelfarb

Alton F. Irby III (principal occupation: Founding Partner, London Bay Capital LLC, a

privately held investment firm, 15 Funston Avenue, San Francisco, CA 94129)

Thomas B. Michaud

Thomas P. Mulroy

Victor J. Nesi

James M. Oates (principal occupation: Managing Director, The Wydown Group, a

financial consulting firm, c/o Northeast Investment Management, Inc., 100 High Street, Suite 1000, Boston, MA 02110)

Ben A. Plotkin

Thomas W. Weisel

Kelvin R. Westbrook (principal occupation: President and Chief Executive Officer,

KRW Advisors, LLC, a privately held telecommunications and media consulting

and advisory services firm, 8000 Maryland Ave., Suite 440, St. Louis, MO 63105)

Michael J. Zimmerman (principal occupation: Vice Chairman, Continental Grain

Company, a privately held diversified international agribusiness and investment firm, 277 Park Avenue, New York, NY 10172)

B. Stifel Venture

Executive Officers:

Ronald J. Kruszewski, President

Bernard N. Burkemper, Treasurer

David M. Minnick, Secretary

Director:

Ronald J. Kruszewski

The address for each of the Executive Officers of both Stifel Financial Corp. and Stifel Venture Corp. is One Financial Plaza, 501 North Broadway, St. Louis, Missouri 63102-2102.

(d)	During the last five years, neither of the Reporting Persons nor any of either Reporting Persons’ Executive Officers or Directors has been convicted in a criminal proceeding.

(e)

During the last five years, neither the of the Reporting Persons nor any of either Reporting Persons’ Executive Officers or Directors has been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction as a result of which proceeding it was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws.

(f)	Stifel Financial Corp. is a Delaware corporation. Stifel Venture Corp. is a Missouri corporation. Each of the Reporting Persons’ Executive Officers and Directors is a citizen of the United States of America.

Item 3.

Source and Amount of Funds or Other Consideration.

The aggregate purchase price for the shares of common stock covered by this Statement is $32,700,000. Stifel Venture funded the purchase price through a contribution of capital to Stifel Venture Corp. by Stifel Financial, which Stifel Financial provided from cash on hand, based on cash generated from general corporate activities.

Item 4.

Purpose of Transaction.

On December 17, 2013, Stifel Venture entered into an arrangement (the “Arrangement”) with CM Finance pursuant to which it agreed to make a capital contribution to CM Finance in an aggregate amount equal to the lesser of $40.0 million and 17.2% of CM Finance’s issued and outstanding shares of common stock after giving effect to its initial public offering (the “IPO”) at the initial public offering price per share. On February 5, 2014, the registration statement for CM Finance’s IPO was declared effective by the Securities and Exchange Commission (the “SEC”). In connection therewith, Stifel Venture made a capital contribution of $32.7 million in CM Finance in exchange for 2,181,818 shares of CM Finance’s common stock, or approximately 17.2% of CM Finance’s shares of common stock outstanding. Pursuant to the Arrangement, Stifel Venture also entered into an agreement with CM Finance giving it the right to nominate for election one member of CM Finance’s board of directors, who is considered “interested” (that is, not independent for purposes of the Investment Company Act of 1940).

In connection with the Arrangement with CM Finance, Stifel Venture also has a 20% interest in CM Finance’s investment adviser and administrator, CM Investment Partners LLC (the “Adviser”), and has a right to appoint a member to the Adviser’s investment committee. Six of the investment professionals employed by the Adviser as part of its investment team are also employees of Stifel Nicolaus & Company, Incorporated (“Stifel Nicolaus”), a full-service retail and institutional brokerage and investment banking firm, and Stifel’s principal subsidiary. Although these investment professionals dedicate a majority of their time to the business and activities of the Adviser, they are concurrent employees of both Stifel Nicolaus and the Adviser, and as a result, may continue to engage in investment advisory activities for Stifel Nicolaus.

Under the Arrangement and subject to certain restrictions, Stifel Financial will use its commercially reasonable efforts to present CM Finance the opportunity to review and bid on all Stifel Nicolaus-originated leveraged finance and high yield corporate debt opportunities consistent with CM Finance’s investment strategy, subject to the approval of CM Finance’s board of directors, as necessary under the 1940 Act, and certain other limitations.

Stifel Venture has entered into a lock-up agreement with the underwriters for CM Finance’s initial public offering, pursuant to which, subject to certain exceptions, Stifel Venture agreed not to, without the prior written approval of the representative of the underwriter, offer, sell, offer to sell, contract or agree to sell, hypothecate, hedge, pledge, grant any option to purchase or otherwise dispose of or agree to dispose of, directly or indirectly, any shares of CM Finance common stock or any securities convertible into or exercisable or exchangeable for CM Finance’s common stock. These restrictions are in effect for a period of 365 days after February 5, 2014, which is the date of the prospectus filed by CM Finance in connection with its initial public offering.

Pursuant to the Arrangement, Stifel Venture entered into a registration rights agreement (the “Registration Rights Agreement”) with CM Finance pursuant to which CM Finance agreed to prepare and file with the SEC a registration statement on Form N-2 to register the resale of the shares of CM Finance common stock that Stifel Venture was issued in connection with the Arrangement. Pursuant to the Registration Rights Agreement, CM Finance agreed to use its commercially reasonable efforts to file with the SEC promptly after a request by Stifel Venture to file such a registration statement with the SEC. CM Finance agreed to use its commercially reasonable efforts to cause such a registration statement to be declared effective by the SEC within 90 days of the initial filing thereof with the SEC. Pursuant to the Registration Rights Agreement, CM Finance also granted Stifel Venture certain piggyback registration rights, which may only be exercised upon the expiration of the lock-up period described above.

Item 5.

Interest in Securities of the Issuer.

(a)-(b) As of the date of this filing, Stifel Venture owns all 2,181,818 shares of CM Finance that are set forth in this filing. Stifel Venture maintains sole voting and investment power over these shares. Since Stifel Financial is the direct parent company of Stifel Venture, Stifel Financial is deemed to beneficially own these shares.

(c) Except as disclosed in Item 4, neither of the Reporting Persons have effected any transactions in shares of CM Finance’s common stock during the past 60 days.

(d) Not applicable.

(e) Not applicable.

Item 6.

Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer.

The information contained in Items 4 and 5 are incorporated by reference herein. Other than as described elsewhere in this Report, the Reporting Persons have no understandings, arrangements, relationships or contracts relating to CM Finance’s common stock which are required to be described hereunder.

Item 7.

Material to Be Filed as Exhibits.

Exhibit

Number Description

1	Joint Filing Agreement between Stifel Financial Corp. and Stifel Venture Corp.

2	Lock-Up Agreement between Stifel Venture Corp. and CM Finance Inc

Registration Rights Agreement, dated as of December 17, 2013 by and among CM Finance LLC, CM Finance Inc, Stifel Venture and the other investors party thereto, incorporated by reference to Exhibit (k)(18) to Pre-Effective Amendment No.1 to CM Finance Inc’s Registration Statement on Form N-2 filed on December 20, 2013. (SEC File No. 333-192370).

SIGNATURES

After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.

Dated: February 18, 2014	STIFEL FINANCIAL CORP.

	By: /s/ James M. Zemlyak
	Name: James M. Zemlyak
	Title: Senior Vice President and
	Chief Financial Officer

	STIFEL VENTURE CORP.

	By: /s/ Bernard N. Burkemper
	Name: Bernard N. Burkemper
	Title: Treasurer

EX-1 2 exh1.htm exh1.htm

Exhibit 1

JOINT FILING AGREEMENT

The undersigned hereby agree that the Statement on this Schedule 13D, dated February 18, 2014 (the “Schedule 13D”), with respect to the Common Stock, of CM Finance Inc is filed on behalf of each of us pursuant to and in accordance with the provisions of Rule 13d-1(k) under the Securities and Exchange Act of 1934, as amended, and that this Agreement shall be included as an Exhibit to this Schedule 13D. Each of the undersigned agrees to be responsible for the timely filing of the Schedule 13D, and for the completeness and accuracy of the information concerning itself contained therein. This Agreement may be executed in any number of counterparts, all of which taken together shall constitute one and the same instrument.

IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the 18th day of February, 2014.

	STIFEL FINANCIAL CORP.

	By: /s/ James M. Zemlyak
	Name: James M. Zemlyak
	Title: Senior Vice President and
	Chief Financial Officer

	STIFEL VENTURE CORP.

	By: /s/ Bernard N. Burkemper
	Name: Bernard N. Burkemper
	Title: Treasurer

EX-2 3 exh2.htm exh2.htm

Exhibit 2

Execution Version

Stifel Venture Corp

237 Park Avenue

8th Floor

New York, New York 10022

January 2, 2014

Raymond James & Associates, Inc.

As Representative of the several Underwriters

named in Schedule A to the Underwriting Agreement

c/o Raymond James & Associates, Inc.

50 North Front Street, 17th Floor

Memphis, Tennessee 38103

Re: Lock-Up Agreement for shares of CM Finance Inc

Ladies & Gentlemen:

The undersigned is an officer, director and/or owner of record or beneficially of shares of common stock (“Common Stock”) of CM Finance Inc, a Maryland corporation (the “Company”). The Company proposes to carry out a public offering of Common Stock (the “Offering”) for which you will act as the representative (the “Representative”) of the several underwriters (the “Underwriters”) listed on Schedule A to the underwriting agreement (the “Underwriting Agreement”) by and among the Company, CM Investment Partners LLC, and the Underwriters. The undersigned recognizes that the Offering will be of benefit to the undersigned and will benefit the Company by, among other things, raising additional capital for its operations. The undersigned acknowledges that you are relying on the representations and agreements of the undersigned contained in this letter agreement (this “Agreement”) in carrying out the Offering and in entering into the Underwriting Agreement with the Company with respect to the Offering.

In consideration of the foregoing, the undersigned hereby agrees that the undersigned, for a period commencing on the date hereof and continuing through the close of trading on the date 365 days after the public offering date set forth on the final prospectus used to sell the Common Stock in the Offering (the “Lock-up Period”) pursuant to the Underwriting Agreement, will not (and will cause any spouse or immediate family member of the spouse or the undersigned living in the undersigned’s household and any trustee of any trust that holds Common Stock for the benefit of the undersigned or such spouse or family member not to), without the prior written consent of the Representative on behalf of the Underwriters (which consent may be withheld in their sole discretion), directly or indirectly, (1) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase or otherwise transfer or dispose of (or enter into any transaction or device that is designed to, or could be expected to, result in the disposition by any person at any time in the future of) any Common Stock (including, without limitation, shares of Common Stock that may be deemed to be beneficially owned by the undersigned in accordance with the rules and

regulations of the Securities and Exchange Commission), (2) enter into any swap or other derivatives transaction that transfers to another, in whole or in part, any economic benefits or risks of ownership of shares of the Common Stock, whether any such transaction described in clause (1) or (2) above is to be settled by delivery of the Common Stock, in cash or otherwise, or (3) publicly announce an intention to do any of the foregoing.

The foregoing restrictions have been expressly agreed to by the undersigned so as to preclude the undersigned (or such spouse, family member or trustee) from engaging in any hedging or other transaction that is designed to or reasonably expected to lead to or result in a disposition of shares of Common Stock during the Lock-up Period, even if such Common Stock would be disposed of by someone other than such holder. Such prohibited hedging or other transactions would include, without limitation, any short sale (whether or not against the box) or any purchase, sale or grant of any right (including, without limitation, any put or call option) with respect to any security (other than a broad-based market basket or index) that includes, relates to or derives any significant part of its value from the Common Stock. In addition, the undersigned agrees that, without the prior written consent of the Representative on behalf of the Underwriters, it will not, during the Lock-Up Period, make any demand for or exercise any right with respect to, the registration of any Common Stock or any security convertible into or exercisable or exchangeable for the Common Stock.

If the undersigned is an officer or director of the Company, the undersigned further agrees that the foregoing provisions shall be equally applicable to any Company-directed Common Stock the undersigned may purchase or otherwise receive in the Offering (including pursuant to a Directed Share Program).

The foregoing shall not apply to the following: (1) the registration of or sale to the Underwriters of Common Stock pursuant to the Offering and the Underwriting Agreement, (2) the issuance of shares of Common Stock in connection with the Formation Transactions (as defined in the Underwriting Agreement), (3) the issuance of shares of Common Stock issuable under the Company’s dividend reinvestment plan, (4) bona fide gifts, succession and inheritance by will or intestacy, (5) transfers to trusts for the benefit of the undersigned, any spouse, immediate family member or a charitable, educational or religious institution by the undersigned; provided, however, that in the case of a transfer under clause (4) or (5), the transferee(s)/donee(s) shall agree in writing prior to such disposition to be bound by the restrictions set forth herein and to the extent any interest in the Common Stock is retained by the undersigned (or such spouse or family member), the Common Stock shall remain subject to the restrictions contained in this Agreement. For the avoidance of doubt, the foregoing restrictions are not meant to, and shall not, apply to any affiliates of the undersigned, including, without limitation with respect to any market-making activities conducted by such affiliates.

The undersigned also agrees and consents (1) with respect to Common Stock held of record by the undersigned, to the entry of stop transfer instructions with the Company’s transfer agent and registrar against the transfer of such Common Stock as described herein except in compliance with this Agreement, and (2) with respect to Common Stock beneficially owned, but not held of record by, the undersigned, to cause the record holder of such Common Stock to agree and consent to the entry of stop transfer instructions with the Company’s transfer agent and

registrar against the transfer of such Common Stock as described herein except in compliance with this Agreement.

If the undersigned is an officer or director of the Company, the Representative agrees that, at least three business days prior to the release or waiver of any of the foregoing restrictions with respect to the Common Stock of the undersigned, including, for the avoidance of doubt, any security of the Company acquired by the undersigned from the Company in the Offering, the Representative will (i) notify the Company of the impending release or waiver and (ii) announce such impending release or waiver through a major news service in the event that the Company fails to make such announcement in accordance with its obligations under the Underwriting Agreement; provided, however, that nowhere the release or waiver is effected solely to permit a transfer of securities that is not for consideration and where the transferee has agreed in writing to be bound by the terms of this Agreement. Any such release or waiver granted hereunder shall only be effective two business days after such announcement is made by the Company or the Representative. The provisions of this paragraph shall not apply to any release or waiver granted solely to permit a transfer of securities that is not for consideration and where the transferee has agreed in writing to be bound by the terms of this Agreement.

It is understood that, if (1) the Company notifies the undersigned that it does not intend to proceed with the Offering, (2) the registration statement filed with the Securities and Exchange Commission with respect to the Offering is withdrawn, or (3) for any reason the Underwriting Agreement shall terminate or be terminated prior to payment for and delivery of the Common Stock to be sold thereunder, the undersigned will be released from its obligations under this Agreement.

[Signature Page Follows]

This Agreement is irrevocable and will be binding on the undersigned and the respective successors, heirs, personal representatives and assigns of the undersigned.

Very truly yours,

STIFEL VENTURE CORP.

/s/ Bernard N. Burkemper

Name: Bernard N. Burkemper

Title: Vice President, Stifel Venture Corp.

[Signature Page- Lock-Up Agreement]