SUNNYSIDE BANCORP, INC. : Entry into a Material Definitive Agreement, Change in Directors or Principal Officers, Financial Statements and Exhibits (form 8-K)

Item 1.01 Entry Into a Material Definitive Agreement.

On August 26, 2021, Rhodium BA Holdings LLC, a Delaware limited liability company ("Rhodium"), Rhodium BA Merger Sub, Inc., a Maryland corporation, Mark Silber, Sunnyside Bancorp, Inc., a Maryland corporation ("Sunnyside Bancorp"), and Sunnyside Federal Savings and Loan Association of Irvington ("Sunnyside Federal"), a federally-chartered savings and loan association and the wholly owned subsidiary of Sunnyside Bancorp, amended (the "Amendment") the Agreement and Plan of Merger dated June 16, 2021 (the "Merger Agreement"), pursuant to which Rhodium will acquire Sunnyside Bancorp and Sunnyside Federal. The Sunnyside Bancorp Board concluded that such Amendment was advisable and in the best interests of shareholders.

The material terms of the Amendment are as follows:

? The cash consideration to be paid to the shareholders of Sunnyside Bancorp is

increased from $18.75 to $20.25 per share.

? The Merger Agreement provided that, upon termination of the Merger Agreement

under certain circumstances, Mr. Silber would be obligated to pay Sunnyside

Bancorp a termination fee of $850,000 from fees previously deposited in

escrow. Under the Amendment, the amount of the termination fee to be paid by

Rhodium to Sunnyside Bancorp was increased to $1.5 million.

? The escrow agreement was amended such that the disbursement of funds can be

effected by Sunnyside Bancorp without the concurrence of Mr. Silber if it

determines in good faith that conditions have been satisfied requiring that

the escrow funds either be provided to Sunnyside Bancorp (generally if Rhodium

cannot obtain regulatory approval or close by May 31, 2022, which is not

primarily due to a breach of representation, warranty or covenant by Sunnyside

Bancorp) or to Mr. Silber (if the Merger Agreement is terminated other than as

indicated above).

? The Merger Agreement allowed Sunnyside Bancorp to entertain certain

third-party acquisition proposals and to accept a superior proposal. The

Amendment modifies certain of these provisions and removes the associated

termination right. Rhodium required such provisions as consideration for the

enhancements to its proposal outlined herein including the $1.50 increase in

the price per share. The Board of Directors of the Company believed acceptance

of such provisions was necessary to obtain the enhanced terms, which it

believed were in the best interests of shareholders.

? The Merger Agreement allowed Rhodium to terminate the transaction if Sunnyside

Bancorp made a Company Subsequent Determination (as defined in the Merger

Agreement). The Amendment modifies that termination right.

? The Amendment requires Rhodium to indemnify Sunnyside Bancorp and its

directors and officers with respect to any out-of-pocket litigation costs and

expenses up to $1.0 million with respect to litigation with certain persons,

including stockholders, related to the Merger, subject to certain conditions.

However, Rhodium is entitled to reimbursement of any costs and expenses it

pays (1) to the extent they are subsequently reimbursed by Sunnyside Bancorp's

D&O insurance carrier or (2) if the Merger Agreement is terminated by Rhodium

because of a material breach of a representation, warranty or covenant by the

Company or by any party for any reason pursuant to which Sunnyside Bancorp is

obligated to pay Rhodium a termination fee.

? The definition of Material Adverse Effect is expanded to limit Rhodium's

ability to terminate the Merger due to litigation.

1

The foregoing summary of the Amendment to the Merger Agreement does not purport to be complete and is qualified in its entirety by reference to the complete text of such document, which is attached hereto as Exhibit 2.1 and is incorporated herein by reference.

Forward-Looking Statements

This Form 8-K contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act. Forward-looking statements include statements regarding the anticipated closing date of the transaction and anticipated future results. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts. They often include words like "believe", "expect", "anticipate", "estimate", and "intend" or future or conditional verbs such as "will", "would", "should", "could" or "may". Certain factors that could cause actual results to differ materially from expected results include; the merger may involve unexpected costs, liabilities or delays; the inability to obtain the necessary regulatory or shareholder approvals or to obtain them in a timely fashion; the reaction of the companies' customers, employees and counterparties to the proposed merger; the outcome of any legal proceedings related to the merger; the occurrence of any event, change or other circumstances that could give rise to the termination of the merger agreement; increased competitive pressures; changes in the interest rate environment; changes in general economic conditions; legislative and regulatory changes that adversely affect the business in which Sunnyside Bancorp, Inc., Sunnyside Federal and Rhodium are engaged; changes in the securities markets; and other risks and uncertainties set forth in Sunnyside Bancorp's filings with the Securities and Exchange Commission, including its most recently filed Annual Report on Form 10-K, subsequent Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and other filings with the SEC, which are available on the SEC's website at www.sec.gov. Undue reliance should not be placed on the forward-looking statements, which speak only as of the date hereof. None of Sunnyside Bancorp, Inc., Sunnyside Federal or Rhodium undertake, and specifically disclaim any obligation, to publicly release the result of any revisions that may be made to update any forward-looking statement to reflect the events or circumstances after the date on which the forward-looking statement is made, or reflect the occurrence of unanticipated events, except to the extent required by law.

Additional Information Regarding the Merger and Where to Find It

This communication does not constitute an offer to sell or the solicitation of an offer to buy the securities of Sunnyside Bancorp or the solicitation of any vote or approval. In connection with the proposed merger, Sunnyside Bancorp, Inc. will provide its shareholders with a proxy statement and other relevant documents concerning the proposed merger. Shareholders of Sunnyside Bancorp, Inc. are urged to read the proxy statement and other relevant documents and any amendments or supplements to those documents, because they will contain important information which should be considered before making any decision regarding theproposed merger.Shareholders of Sunnyside Bancorp, Inc. will be able to obtain a copy of the proxy statement, and any other relevant documents, without charge, when they become available, at the Securities and Exchange Commission website (www.sec.gov), or by directing a request to:

Timothy D. Sullivan

                     President and Chief Executive Officer

                            Sunnyside Bancorp, Inc.

                                 56 Main Street

                           Irvington, New York 10533



2

Certain Information Regarding Participants in the Solicitation

Sunnyside Bancorp, Inc. and certain of its directors, executive officers and employees may be deemed to be participants in the solicitation of proxies from the shareholders of Sunnyside Bancorp, Inc. in connection with the proposed merger. Information about the directors and executive officers of Sunnyside Bancorp, Inc. is set forth in Sunnyside Bancorp, Inc.'s proxy statement, which was filed with the Securities Exchange Commission on July 26, 2021, as modified or supplemented by any Form 3 or Form 4 filed with the SEC since the date of such documents, and in subsequent documents filed with the SEC. Additional information regarding the interests of these participants and any other persons who may be deemed participants in the transaction may be obtained by reading the proxy statement regarding the proposed merger when it becomes available. Free copies of this document may be obtained as described in the preceding paragraph.

Item 5.02 Departure of Directors or Certain Officers; Election of Directors;

          Appointment of Certain Officers; Compensatory Arrangements of Certain
          Officers.

On August 26, 2021, Desmond Lyons resigned from the board of directors of Sunnyside Bancorp, Inc. (the "Company"). At the time of his resignation, Mr. Lyons was a member of the Nominating and Corporate Governance Committee and the Compensation Committee.

While Mr. Lyons is supportive of the Company's overall strategic direction and its transaction with Rhodium BA Holdings LLC ("Rhodium"), Mr. Lyons disagreed with certain provisions in the most recent version of the merger agreement with Rhodium that seek to restrict further third-party negotiations and, prior to the vote on such amendment, resigned.

Item 9.01. Financial Statements and Exhibits.

  (d) Exhibits




  Exhibit No.   Description

  2.1             Amendment to the Agreement and Plan of Merger, dated as of June
                16, 2021, by and among Rhodium BA Holdings LLC, Rhodium BA Merger
                Sub, Inc., Mark Silber, Sunnyside Bancorp, Inc. and Sunnyside
                Federal Savings and Loan Association of Irvington

  104           Cover Page Interactive Data File (embedded in the cover page
                formatted in Inline XBRL)




3

© Edgar Online, source Glimpses