UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A INFORMATION

Proxy Statement

Pursuant to Section 14(a) of the Securities

Exchange Act of 1934 (Amendment No.)

Filed by the Registrant [X]☒

Filed by a Party other than the Registrant [  ]☐

Check the appropriate box:

[X]  

[   ]  Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))OptimumBank Holdings, Inc.

[   ]  Definitive Proxy Statement

[   ]  Definitive Additional Materials

[   ]  Soliciting Material Pursuant to § 240.14a-12

OPTIMUMBANK HOLDINGS, INC.

(Name of Registrant as Specified in Its Charter)

(Name of person(s) filing proxy statement, if other than the registrant)

Payment of Filing Fee (Check the appropriate box):

[X]  No fee required.

[   ]  Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.

1)  Title of each class of securities to which transaction applies:

2)  Aggregate number of securities to which transaction applies:

4)  Proposed maximum aggregate value of transaction:

5)  Total fee paid:

[   ]  Fee paid previously with preliminary materials.

[   ]  Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.

1)  Amount previously paid:

2)  Form, Schedule or Registration Statement No.:

3)  Filing Party:

4)  Date Filed:

PROXY STATEMENT

20132023 ANNUAL MEETING OF SHAREHOLDERS

April 30, 2013

PROXY VOTING OPTIONS

YOUR VOTE IS IMPORTANT!

Whether or not you expect to attend in person, we urge you to vote your shares by phone, via the Internet, or by signing, dating, and returning the enclosed proxy card at your earliest convenience. This will ensure the presence of a quorum at the meeting. Promptly voting your shares will save us the expense and extra work of additional solicitation. Submitting your proxy now will not prevent you from voting your stock at the meeting if you want to do so, as your vote by proxy is revocable at your option.

Voting by theInternet orTelephone is fast and convenient, and your vote is immediately confirmed and tabulated. Most important, by using the Internet, or telephone, you help us reduce postage and proxy tabulation costs.

Or, if you prefer, you can return the enclosed Proxy Card in the envelope provided.

PLEASE DO NOT RETURN THE ENCLOSED PROXY CARD IF YOU ARE VOTING OVER THE INTERNET OR BY TELEPHONE.INTERNET.

April [][_], 20132023

Dear Shareholder:

You are cordially invited to attend the 2023 annual meeting of shareholders of OptimumBank Holdings, Inc., which will be held at the executive offices of OptimumBank, 24772929 East Commercial Boulevard, Suite 303, Fort Lauderdale, Florida 33308, on Tuesday, April 30, 2013,[__________], May [_], 2023, at 10:00 a.m.

Details of the business to be conducted at the annual meeting are given in the attached Notice of Annual Meeting and Proxy Statement.

Also enclosed is a copy of our Annual Report on Form 10-K for 2012,2022, which contains important information about our company.

Whether or not you attend the annual meeting, it is important that your shares be represented and voted at the meeting. Therefore, I urge you to promptly vote and submit your proxy by phone, via the Internet, or by signing, dating, and returning the enclosed proxy card in the enclosed envelope. If you decide to attend the annual meeting, you will be able to vote in person, even if you have previously submitted your proxy.

If you need directions to the annual meeting, please call our offices at (954) 776-2332, Ext.101.900-2805.

On behalf of the Board of Directors, I would like to express our appreciation for your continued support for our company.

OPTIMUMBANK HOLDINGS, INC.

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

April 30, 2013To be held on May [_], 2023

To the Shareholders:

The annual meeting of the shareholders of OptimumBank Holdings, Inc. will be held at the executive offices of OptimumBank, 24772929 East Commercial Boulevard, Fort Lauderdale, Suite 303, Florida 33308, on April 30, 2013,[_________], May [_], 2023, at 10:00 a.m. for the following purposes:

1. To elect four directors.seven (7) directors;

2. To approve the issuance and sale of up to a total of 7,333,33311,113,889 shares of the Company’s common stock at a priceupon conversion of $0.30 per share to Moishe Gubin under the terms of an Amended and Restated Stock Purchase Agreement betweenSeries B preferred stock previously issued by the Company and Mr. Gubin.Company;

3. To approve an amendment to the Reverse Stock Split pursuantCompany’s articles of incorporation to which every four (4) outstandingincrease the maximum number of shares of common stock that may be issued by the Company from 10,000,000 shares to 30,000,000 shares;

4. To approve an amendment to the Company’s common stock would2018 Equity Incentive Plan to increase the maximum number of shares that may be combined into (1) outstanding shareissued under the plan from 550,000 shares to 1,050,000 shares;

5. To consider an advisory vote on executive compensation;

6. To consider an advisory vote on the frequency of the Company’s common stockadvisory vote on a record date to be established by the Company’s Board of Directors following the annual meeting.executive compensation;

4.

7. To ratify the selection of Hacker, Johnson & Smith, PAP.A. as the Company’s independent auditor for fiscal year 2013.2023; and

5.

8. To transact such other business as may properly come before the Annual Meeting.

Only shareholders of record at the close of business on April 3, 2013,March 6, 2022, are entitled to notice of, and to vote at, this meeting.

IMPORTANT

Whether or not you expect to attend in person, we urge you to vote your shares at your earliest convenience. This will ensure the presence of a quorum at the meeting. Promptly voting your shares by telephone, via the Internet, or by signing, dating, and returning the enclosed proxy card will save our company the expenses and extra work of additional solicitation. An addressed envelope for which no postage is required if mailed in the United States is enclosed if you wish to vote by mail. Submitting your proxy now will not prevent you from voting your shares at the meeting if you desire to do so, as your proxy is revocable at your option.

Important Notice Regarding the Availability of Proxy Materials for the Shareholder Meeting to be Heldheld on April 30, 2013.May [_], 2023. Our Proxy Statement and Annual Report on Form 10-K Annual Report for 20122022 are available athttp://www.optimumbank.com/stockholder-information/

OPTIMUMBANK HOLDINGS, INC.

2477 EAST COMMERCIAL BOULEVARD

FORT LAUDERDALE, FLORIDA2929 East Commercial Boulevard

Fort Lauderdale, Florida 33308

PROXY STATEMENT

20132023 ANNUAL MEETING OF SHAREHOLDERS

APRIL 30, 2013TO BE HELD ON MAY [_], 2023

This Proxy Statement will be first mailed to shareholders on or about April [][_], 2013.2023. It is furnished in connection with the solicitation of proxies by the Board of Directors of OptimumBank Holdings, Inc. (the “Company”) to be voted at the annual meeting of the shareholders of the Company, which will be held at 10:00 a.m. on Tuesday, April 30, 2013,[______], May [_], 2023, at the executive offices of OptimumBank (the “Bank”), 24772929 East Commercial Boulevard, Suite 303, Fort Lauderdale, Florida 33308, for the purposes set forth in the accompanying Notice of Annual Meeting of Shareholders. Shareholders who execute proxies retain the right to revoke them at any time before the shares are voted by proxy at the meeting. A shareholder may revoke a proxy by delivering a signed statement to the Secretary of the Company at or prior to the annual meeting or by executing and delivering another proxy dated as of a later date. The Company will pay the cost of solicitation of proxies.

Shareholders of record at the close of business on April 3, 2013March 6, 2023 will be entitled to vote at the meeting on the basis of one vote for each share held. On the record date, there were 31,511,2017,250,218 outstanding shares of common stock outstanding, held of record by 872156 shareholders. There were approximately 776 shareholders who hold the shares through in “street name.”

QUESTIONS AND ANSWERS ABOUT THE ANNUAL MEETING

When and where will the annual meeting take place?

The annual meeting will be held on April 30, 2013May [_], 2023, at 10:00 a.m. (Eastern Daylight Time)(local time), at the executive offices of the Bank, 24772929 East Commercial Boulevard, Suite 303, Fort Lauderdale, Florida 33308.

Why did I receive this proxy statement?

You received this proxy statement because you held shares of the Company’s common stock on April 3, 2013March 6, 2023 (the “Record Date”) and are entitled to vote at the annual meeting. The Board of Directors is soliciting your proxy to vote at the meeting.

What am I voting on?

You are being asked to vote on fourthree items:

1. The election of four DirectorsTo elect seven (7) directors (see page 6);

2. To approve the issuance and sale of up to a total of 7,333,33311,113,889 shares of the Company’s common stock at a priceupon conversion of $0.30 per share to Moishe Gubin under the terms of a Stock Purchase Agreement betweenSeries B preferred stock previously issued by the Company and Mr. Gubin (see page 10)11);

3. To approve an amendment to the Reverse Stock Split pursuantCompany’s articles of incorporation to which every four (4) outstandingincrease the maximum number of shares of the Company’s common stock wouldthat may be combined into (1) outstanding share of the Company’s common stock on a record date to be establishedissued by the Company’s Board of Directors following the annual meetingCompany from 10,000,000 shares to 30,000,000 shares (see page 14)18); and

14. To approve an amendment to the Company’s 2018 Equity Incentive Plan to increase the maximum number of shares that may be issued under the plan from 550,000 shares to 1,050,000 shares (see page 20);

5. To consider an advisory vote on executive compensation (see page 23);

6. To consider an advisory vote on the frequency of the appointmentadvisory vote on executive compensation (see page 24); and

7. To ratify the selection of Hacker, Johnson & Smith, PAP.A. as the Company’s independent registered public accounting firmauditor for the 2013 fiscal year 2023 (see page 21)25).

How do I vote?

Shareholders of Record

If you are a shareholder of record, there are fourthree ways to vote:

• By toll free telephone at 1-866-894-0537.

•● By internet at www.continentalstock.comhttp://www.cstproxyvote.com;

•

● If you request printed copies of the proxy materials, you may vote by proxy by completing and returning your proxy card in the postage-paid envelope provided by the Company; or

•

● By voting in person at the meeting.

Street Name Holders

Shares which are held in a brokerage account in the name of the broker are said to be held in “street name.”

If your shares are held in street name, you should follow the voting instructions provided by your broker. If you requested printed copies of the proxy materials, you may complete and return a voting instruction card to your broker, or, in many cases, your broker may also allow you to vote via the telephone or Internet. Check your notice from your broker for more information. If you hold your shares in street name and wish to vote at the meeting, you must obtain a legal proxy from your broker and bring that proxy to the meeting.

Regardless of how your shares are registered, if you request printed copies of the proxy materials, complete and properly sign the accompanying proxy card and return it to the address indicated, it will be voted as you direct.

What is the deadline for voting via Internet or telephone?Internet?

Internet and telephone voting is available through 11:59 p.m. (Eastern Daylight Time) on Monday, April 29, 2013[______], May [_], 2023 (the day before the annual meeting).

What are the voting recommendations of the Board of Directors?

The Board of Directors recommends that you vote in the following manner:

1. FOR each of the persons nominated by the Board of Directors to serve as Directors;

2. FOR approving the issuance of up to 11,113,889 shares of common stock upon conversion of the Series B preferred stock previously issued by the Company;

3. FOR amending the Company’s articles of incorporation to increase the maximum number of shares of common stock that may be issued by the Company from 10,000,000 shares to 30,000,000 shares;

4. FOR amending the Company’s 2018 Equity Incentive Plan to increase the maximum number of shares that may be issued under the plan from 550,000 shares to 1,050,000 shares;

5. FOR the approval of the issuance and sale of up to a total of 7,333,333 sharescompensation of the Company’s common stock at a price of $0.30 per share to Moishe Gubin undernamed executive officers as disclosed in the terms of a Stock Purchase Agreement between the CompanyExecutive Compensation section and Mr. Gubin.accompanying compensation tables contained in this Proxy Statement;

3.

6. FOR the approval of the Reverse Stock Split pursuant to whicha frequency of every four (4) outstanding shares of the Company’s common stock would be combined into (1) outstanding share of the

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Company’s common stock on a record date to be established by7. FOR ratifying the Company’s Board of Directors following the annual meeting.

4.  FOR the ratification of the appointmentselection of Hacker, Johnson & Smith, PAP.A. as the Company’s independent registered public accounting firmauditor for the 2013 fiscal year.year 2023.

Unless you give contrary instructions in your proxy, the persons named as proxies will vote your shares in accordance with the recommendations of the Board of Directors.

Will any other matters be voted on?

We do not know of any other matters that will be brought before the shareholders for a vote at the annual meeting. If any other matter is properly brought before the meeting, your proxy would authorize Moishe Gubin and Sam BorekJoel Klein of the Company to vote on such matters in their discretion.

Who is entitled to vote at the meeting?

Only shareholders of record at the close of business on the Record Date are entitled to receive notice of and to vote at the annual meeting. If you were a shareholder of record on that date, you will be entitled to vote all of the shares that you held on that date at the annual meeting, or any postponement or adjournment of the meeting.

How many votes do I have?

You will have one vote for each share of the Company’s common stock that you owned on the Record Date.

How many votes can be cast by all shareholders?

The Company had 31,511,2017,250,218 outstanding shares of common stock on the Record Date. Each of these shares is entitled to one vote. There is no cumulative voting.

How many votes must be present to hold the meeting?

The holders of a majority of the Company’s common stock outstanding on the Record Date must be present at the meeting in person or by proxy in order to fulfill the quorum requirement necessary to hold the meeting. This means at least 15,755,6013,625,110 shares must be present in person or by proxy.

If you vote, your shares will be part of the quorum. Abstentions and broker non-votes will also be counted in determining the quorum. A broker non-vote occurs when a bank or broker holding shares in street name submits a proxy that states that the broker does not vote for some or all of the proposals because the broker has not received instructions from the beneficial owners on how to vote on the proposals and does not have discretionary authority to vote in the absence of instructions.

We urge you to vote by proxy even if you plan to attend the meeting so that we will know as soon as possible that a quorum has been achieved.

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What vote is required to approve each proposal?

For the election of Directors (Proposal No. 1), the affirmative vote of a plurality of the votes present in person or by proxy and entitled to vote at the meeting is required. A proxy that has properly withheld authority with respect to the election of one or more Directors will not be voted with respect to the Director or Directors indicated, although it will be counted for the purposes of determining whether there is a quorum.

For the approval of the issuance and sale of up to a total of 7,333,33311,113,889 shares of the Company’s common stock at a priceupon conversion of $0.30 per share to Moishe Gubin under the terms of a Stock Purchase Agreement betweenSeries B preferred stock previously issued by the Company and Mr. Gubin (Proposal No. 2)No.2), the affirmative vote of athe majority of the shares represented in person or by proxy and entitled to vote at the meetingvotes cast for this proposal will be required for approval. An abstention with respect to this proposalAs such, abstentions and broker non-votes will not be voted with respect toaffect the amendment, although itoutcome of the vote, but will be counted for determining the purposesexistence of determining whether there is a quorum.

For the approval of the Reverse Stock Split pursuant to which every four (4) outstanding sharesamendment of the Company’s articles of incorporation to increase the maximum number of shares of common stock wouldthat may be combined into (1) outstanding share ofissued by the Company’s common stockCompany from 10,000,000 shares to 30,000,000 shares (Proposal No. 3), the affirmative vote of athe majority of the shares represented in person or by proxy and entitled to vote at the meetingvotes cast for this proposal will be required for approval. An abstention with respect to this proposalAs such, abstentions and broker non-votes will not be voted with respect toaffect the amendment, although itoutcome of the vote, but will be counted for determining the purposesexistence of determining whether there is a quorum.

For the approval of the amendment to the Company’s 2018 Equity Incentive Plan to increase the maximum number of shares that may be issued under the plan from 550,000 shares to 1,050,000 shares (Proposal No. 4), the affirmative vote of the majority of the votes cast for this proposal will be required for approval. As such, abstentions and broker non-votes will not affect the outcome of the vote, but will be counted for determining the existence of a quorum.

For the advisory vote on executive compensation (Proposal No. 5), the affirmative vote of the majority of the votes cast for this proposal will be required for approval. As such, abstentions and broker non-votes will not affect the outcome of the vote, but will be counted for determining the existence of a quorum. Because your vote is advisory, it will not be binding on the Board or the Company. However, the Board will review the voting results and take them into consideration when making future decisions regarding executive compensation.

For the advisory vote on the frequency of the advisory votes on executive compensation (Proposal No. 6), the affirmative vote of the majority of the votes cast for this proposal will be required for approval. As such, abstentions and broker non-votes will not affect the outcome of the vote, but will be counted for determining the existence of a quorum. Because your vote is advisory, it will not be binding on the Board or the Company. However, the Board will review the voting results and take it into consideration when making future decisions regarding the frequency of the advisory vote on executive compensation.

For the ratification of the appointment of Hacker, Johnson & Smith, PAP.A. (Proposal No. 4)7), the affirmative vote of athe majority of the shares represented in person or by proxy and entitled to vote at the meetingvotes cast for this proposal will be required for approval. An abstention with respect to this proposalAs such, abstentions and broker non-votes will not affect the outcome of the vote, but will be counted for the purposes of determining the number of shares entitled to vote that are present in person or by proxy. Accordingly, an abstention will have the effectexistence of a negative vote.quorum.

Can I change my vote?

Yes. If you are a shareholder of record, you may change your vote at any time before your proxy is voted at the annual meeting. You can do this in one of three ways. First, you can send a written notice stating that you would like to revoke your proxy. Second, you can submit new proxy instructions either on a new proxy card by telephone or via the Internet. Third, you can attend the meeting, and vote in person. Your attendance alone will not revoke your proxy. If you have instructed a broker to vote your shares, you must follow directions received from your broker to change those instructions.

Who can attend the annual meeting?

Any person who was a shareholder of the Company on April 3, 2013March 6, 2022 may attend the meeting. If you own shares in street name, you should ask your broker or bank for a legal proxy to bring with you to the meeting. If you do not receive the legal proxy in time, bring your most recent brokerage statement so that we can verify your ownership of the Company’s stock and admit you to the meeting. However, you will not be able to vote your shares at the meeting without a legal proxy.

What happens if I sign and return the proxy card but do not indicate how to vote on an issue?

If you return a proxy card without indicating your vote, your shares will be voted as follows:

•

1. FOR each of the nominees for Director named in this proxy statement;

42. FOR approval of the issuance of up to 11,113,889 shares of common stock upon conversion of the Series B preferred stock previously issued by the Company;

•3. FOR amending the Company’s articles of incorporation to increase the maximum number of shares of common stock that may be issued by the Company from 10,000,000 shares to 30,000,000 shares;

4. FOR amending the Company’s 2018 Equity Incentive Plan to increase the maximum number of shares that may be issued under the plan from 550,000 shares to 1,050,000 shares;

5. FOR the approval of the issuance and sale of up to a total of 7,333,333 sharescompensation of the Company’s common stock at a price of $0.30 per share to Moishe Gubin undernamed executive officers as disclosed in the terms of a Stock Purchase Agreement between the CompanyExecutive Compensation section and Mr. Gubin.accompanying compensation tables contained in this Proxy Statement;

•

6. FOR the approval of a frequency of every THREE YEARS for future non-binding shareholder advisory votes on executive compensation; and

7. FOR ratifying the Reverse Stock Split pursuant to which every four (4) outstanding shares of the Company’s common stock would be combined into (1) outstanding share of the Company’s common stock on a record date to be established by the Company’s Board of Directors following the annual meeting.

• FOR ratification of the appointmentselection of Hacker, Johnson & Smith, PAP.A. as the Company’s independent registered public accounting firmauditor for the Company for the 2013 fiscal year.year 2023.

Who can help answer my questions?

If you are a shareholder, and would like additional copies, without charge, of this proxy statement or if you have questions about the annual meeting, including the procedures for voting your shares, you should contact:

Lisa Seltzer, Corporate Secretary

Mary Franco, Operations Assistant - (954) 776-2332

PROPOSAL NO. 1

ELECTION OF DIRECTORS

NOMINEES

Our Board of Directors currently consists of fourhas 7 members, and four directors are elected annually to be elected atone-year terms. Each of our current directors have been nominated for election by the annual meetingBoard to hold office until the next2024 annual meeting and the election of shareholders and until their successors are elected and qualified. successors.

All of the nominees are current directors. The Board of Directors has nominated all fourcurrently serve on our Board. Each of the currentnominees has previously been elected by the shareholders, other than Steven Newman who was elected by the directors for election atin August 2022 to fill a vacancy arising from the 2013 annual meeting, based on the recommendationresignation of the Company’s independent directors.Mr. Chan Ambrose.

The accompanying proxy will be voted in favor of the following persons to serve as directors unless the shareholder indicates to the contrary on the proxy. The election of the Company’s directorsDirectors requires a plurality of the votes cast in person or by proxy at the meeting. Management expects that each of the nominees will be available for election,to serve if elected, but if any of them is unable to serve at the time the election occurs, the proxy will be voted for the election of another nominee to be designated by the Board of Directors.

Moishe Gubin, age 36,46, has served as Chairman of the Company since December 2011 and as a directorDirector of the Company and OptimumBank since March 2010. Since 2009, he has served as the chief executive officerMr. Gubin is Chief Executive Officer of United Rx, LLC,Strawberry Fields REIT, Inc. (NYSE American: STRW), an owner of a long term care pharmacy, and since November 2003, his primary occupationportfolio of healthcare properties. Mr. Gubin has been the ownershipCEO of this company and financial managementits predecessor since 2008. From 2004 to 2014, Mr. Gubin was the Chief Financial Officer and manager of nursing homes and related rehabilitation facilities located in Indiana and Illinois. Since 2005, he has served as the chief financial officer and principal of New York BoysInfinity Healthcare Management, LLC, locateda company engaged in South Bend, Indiana, which provides consulting services for twelvemanaging skilled nursing homesfacilities and rehabilitation facilities. Since 2005, Mr. Gubin has also served as the chief financial officer of TriCare Rehab, which provides rehabilitation services forother health care facilities, located in Hillside, Illinois. From November 2003 to November 2006, Mr. Gubin served as the controller of Crestmark of Roselawn, a nursing home located in Demotte, Indiana. From January 2002 to October 2003, Mr. Gubin served as the Indiana State Director of Budgeting of Care Centers, Inc., where he was responsible for the financial management of twelve nursing homes. From September 2000 to January 2002, he served as controller of Fairview Nursing Care Center and Adult Day Care Center, a 200-bed nursing home located in New York. From September 1999 to June 2000, he served as assistant controller of Park Terrace Care Center, a 200 bed nursing home also located in New York. He served as Director of Operations for Yeshiva of Great Neck, New York, from October 1996 to September 1999.facilities. Mr. Gubin graduated from Touro Liberal Arts and Science College, in New York, New York, with a BS in Accounting and Information Systems and a Minor in Jewish Studies. Mr. Gubin is the founder of the Midwest Torah Center Inc., a non-profit spiritual outreach center (www.midwesttorah.org). He also attended Yeshiva Bais Israel where he received a BA in Talmudic Literature. Mr. Gubin has been a licensed Certified Public Accountant in the State of New York since 2010.

Seth Gillman,age 44, has been As a long-time director and significant shareholder of the Company, Mr. Gubin brings extensive experience with the Company and OptimumBank since July 2011. Since 2005, Mr. Gillman has served as founder, administrator and managing member of Passages Hospice, LLC, a hospice care provider located in Elgin, Illinois. From 2001 to 2005, Mr. Gillman served as general counsel, director of business development, and corporate secretary to ASTA Healthcare Company, Inc., a management company for nursing home facilities located in Elgin, Illinois. From 1996 to 2001, Mr. Gillman served as legal counsel, then general counsel, of Doctors Hospital of Hyde Park, located in Chicago, Illinois, and from 1994 to 1996, as a staff attorney and legislative aidshareholder perspective to the Chicago City Council.Board. Mr. Gillman received his Juris Doctor from Benjamin N. Cardozo School of Law,Gubin’s experience in New York New York,accounting provides the Board with expertise in accounting matters and his L.L.M. in Health Law from DePaul University Schoolexperience as the CEO of Law, in Chicago, Illinois. Mr. Gillman is licensed as an attorney and nursing home administrator ina large healthcare company provides the State of Illinois.Board’s with the general management expertise.

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Joel Klein,age 66,76, became a directorDirector of the Company and OptimumBank in February 2012. Since February 2020, Mr. Klein has also been retired since 2011. From 2006 until 2010, he servedserving as the Company’s interim Chief Financial Officer, until the Company designates his replacement. Mr. Klein worked in accounting and finance for Chicago-basedmore than 41 years, including six years as a CPA in public accounting. From 1989 to 1990, he was the Chief Financial Officer of Choice Drug Systems, Inc., a medical supply company primarily to skilled nursing facilities. From 1991 to 1994, he was a Vice-President of Equilease Corporation, an equipment leasing company. He then served as a Vice President of The Stamford Capital Group, Inc., an independent corporate advisory company, from 1994 to 2005, providing high quality advisory services to medium market clients, particularly mergers and acquisitions, divestitures, management buy outs and other strategic financial advisory services. From 2006 to 2010, he was the Chief Financial Officer of Taxi Affiliation Services, LLC, a taxi company that provides support services to transportation companieslocated in five states and over twenty separate municipalities. Between 1994 and 2005, he was a vice president at The Staimford Group, Inc., a Connecticut based provider of investment and merchant banking services. Prior to his service with The Staimford Group,Chicago, Illinois. Mr. Klein served in various financial management capacities, including Chief Financial Officer, Controller, and Senior Accountant with various firms, including Equilease Corporation, Choice Drug Systems, Inc., The Leasing Equipment Group, Ltd., I.C. Herman & Co., Goldstein, Golub, Kessler & Co. CPA’s, and Brout, Isaacs & Co. CPA’s.has been a private investor since 2010. Mr. Klein received a Bachelor of Science degree in Accounting from Brooklyn College in 1969. He has been licensed as a CPA in the State of New York since 1972. Mr. Klein’s significant experience in finance and accounting provides the Board with expertise in financing management and accounting issues. His long service as director also aids the Board by providing a deep understanding of the Company’s business.

Sam BorekMartin Z. Schmidt, age 62,75, became a Director of the Company and OptimumBank in August 2015. Mr. Schmidt has been in the financial and estate planning, securities and insurance industries since 1975. From 1993 to 2000, he served as a Vice President and Branch Manager for multiple branches of Advest, Inc., a major regional securities and investment management firm. In 2007, he served in a marketing capacity and liaison to the national senior accounting firms for Twenty-First Securities, Inc., introducing market based solutions for tax and corporate based problems within their institutional client base. Since 2013, he has been an independent financial consultant with National Holdings Corp/Gilman Ciocia. Mr. Schmidt served with the 423^rd Military Police, U.S. Army Reserve, for five years, completed 3 years of coursework towards an MBA in Management Science and Statistics at the Lubin Graduate School of Business Administration in 1973, and graduated Brooklyn College with a B.A. in Economics in 1969. Mr. Schmidt’s significant experience in the financial services industry provides the Board with expertise in operating a financing services business.

Avi M. Zwelling, age 50, became a Director of the Company and OptimumBank in December 2017. Mr. Zwelling is the managing partner of Zwelling Law, PLLC, which has offices in Boca Raton, Florida and Chicago, Illinois. The firm handles commercial litigation, insurance defense, banking, and real estate matters. Mr. Zwelling graduated from Columbia University in New York, New York, with a B.A. in Comparative Religion, and earned a law degree from the Benjamin N. Cardozo School of Law, also in New York, New York. Mr. Zwelling has been providing legal services to the Company since 2012. As an experienced attorney, Mr. Zwelling’s knowledge and expertise in legal matters assists the Board in addressing legal issues faced by the Company.

Thomas Procelli, age 68, has served as a directorDirector of the Company since March 2004July 2017 and OptimumBank since October 2012. Mr. Procelli is Chief Financial Officer for Better Living Solutions, a Tallahassee counseling and wellness outpatient center specializing in eating disorder treatment and offers financial institution and business support services through his firm TAP Independent Consulting. Mr. Procelli served as an Executive Vice President since the founding of OptimumBank in October 2000 through September 2015 in the positions of Chief Technology Officer and Chief Operating Officer. Mr. Procelli has been in banking for over 40 years having a diverse background in operations, information systems, compliance and audit. Outside of banking, he has worked in public accounting at the firm of Coopers and Lybrand and in mortgage origination software product development at Fiserv. He received his MBA in Finance in 1979 and his BBA degree in Accounting in 1976 from Hofstra University located in Hempstead, New York. Mr. Procelli’s 15 years of service as an executive of OptimumBank provides the Board with the benefit of his expertise in banking and accounting matters, as well as insight into the operations of OptimumBank.

Michael Blisko, age 47, has served as a Director since May 2021. For more than 10 years, Mr. Blisko has been the Chief Executive Officer for Infinity Healthcare Management, LLC, a company that provides consultation services to skilled nursing facilities and other health care facilities with over 10,000 beds.. Mr. Blisko is currently a director of Strawberry Fields REIT, Inc. (NYSE American: STRW), an owner of a portfolio of healthcare properties. Mr. Blisko is a principal of related healthcare companies, including United Rx, a long-term pharmacy, Xcel Med, and Bella Monte Recovery. Currently, Mr. Blisko is on the national executive committee for Post-Acute Care for the American Healthcare Association (AHCA) in Washington D.C. Mr. Blisko founded and currently serves on the Board of Directors of The Ambassador Group which represents regional Post-Acute Operators serving over one hundred thousand residents throughout the country. Mr. Blisko is on the Deans Advisory Board for Hofstra University Graduate School for Health and Applied Sciences. Mr. Blisko holds a master’s degree in Healthcare Administration from Hofstra University and a BA in Talmudic Letters from Bais Yisroel, Jerusalem. As a significant shareholder of the Company, Mr. Blisko provides a shareholder perspective to the Board. Mr. Blisko’s experience as an executive of several healthcare companies provides the Board with the general management expertise.

Steven Newman, age 46, became a Director of the Company and OptimumBank sincein August 2001. He2022Mr. Newman has been the Chief Executive Officer of Newman Group, LLC, a licensed real estate brokerage firm based in South Florida which he founded in 2002. Mr. Newman is also served as the Chairman of the Board of Freight Factoring Specialists, LLC, a middle market, full-service factoring company serving the Company between December 2009transportation industry, which he founded in 2015. Mr. Newman has been an active real estate investor and December 2011, and currently serves as Vice-Chairman. Mr. Borek has served since 1977 as the managing partner of the law firm of Borek & Goldhirsh in Wilmette, Illinois. From 1998 to 2006, Mr. Borek served as a director,board member of several non-profit organizations. Mr. Newman received his BA in Sociology from Queens College at the City University of New York in 1998. As an active participant in the South Florida real estate industry, Mr. Newman has and from 2004will continue to 2006, as Chairmanprovide the Company and the Bank the benefit of his experience and knowledge of the Board,local real estate market, as well as the benefit of NCB Holdings, Inc.,his ability as a bank holding company located in Chicago, Illinois. Mr. Borek received a Bachelorsuccessful business executive.

The following table provides the composition of Arts degree from the University of Illinois Urbana in 1972our board members and a Juris Doctor from the DePaul University School of Law in 1975 and has practiced law in Illinois for the past 34 years. Mr. Borek is very involved in community activities, including prior service as Presidentnominees. Each of the Niles Township School Board for High School District 219, member ofcategories listed in the Executive Board ofbelow table has the Niles Township Legislative Coalition, and Director of the Midwest Friends of Israel Sport Center for the Disabled and Maccabi USA Sports for Israel.meaning as it is used in NASDAQ Rule 5605(f).

THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR“FOR” ALL DIRECTOR NOMINEES.

CORPORATE GOVERNANCE

Director Independence

The Board of Directors analyzed the independence of each director and determined that the following directorsMoishe Gubin, Thomas Procelli, Martin Schmidt, Avi Zwelling, Michael Blisko, and Steve Newman each meet the standards of independence ofunder the applicable listing standards of The NASDAQ Stock Market (“NASDAQ”): Seth Gillman, Moishe Gubin and Joel Klein..

One of the directors, Sam Borek, is not considered independent. Mr. Borek served as a consultant to the Company until July 2011.

The Board of Directors Meetings and Committees

OptimumBank Holdings’

The Company’s Board of Directors met 18eleven (11) times during 2012.2022. The independent directors met [once] in executive session without management two times during 2012.2022. Each of the current members of the Board of Directors attended at least 75% of the meetings of the Board and committees on which he served.served held while he has been a Director. The Company’s Board of Directors has established several standing committees, including the following:

Compensation Committee

The Compensation Committee currently consists of three directors: Moishe Gubin (Chairman), Seth GillmanThomas Procelli, and Joel Klein, each of whom isAvi Zwelling. Messrs. Gubin, Zwelling, and Procelli are independent under the NASDAQ listing standards. The Compensation Committee reviews and recommends to the Board of Directors the compensation arrangements for executive management and non-employee directors. The Compensation Committee met fourtwo (2) times during 20122022 and operates under a written charter. A copy of the current Compensation

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Committee Charter can be viewed on the Company’s website atwww.optimumbank.com/information-center/corporate-governance.information-center/corporate-governance/.

In 2012,2022, no executive officer had a role in determining or recommending the amount or form of outside director compensation. The Compensation Committee does not delegate its authority to any other persons. The Compensation Committee does not use consultants to determine or recommend the amount or form of compensation arrangements.

Nominating Committee

The Company has no formal nominatingNominating Committee currently consists of Mr. Gubin (Chairman), Mr. Procelli, and Mr. Zwelling. The committee or nominating committee charter. Instead, the three independent members of the Board, Messrs. Gillman, Gubin and Klein perform the functions of a nominating committee. Pursuant to the Corporate Governance Guidelines adopted by the Board of Directors, the independent directors are responsible for recommending for the full Board’s selection the slate of director nominees for election.

These guidelines also provide for the independent directors to evaluateevaluates new candidates and current directors and recommendrecommends candidates to the Board to fill vacancies occurring between annual shareholder meetings. A copy of the charter for the Nominating Committee can be viewed on the Company’s website at www.optimumbank.com/information-center/corporate-governance.

All of the director nominees of the Company set forth in the Proposal entitled “Election of Directors” were recommended by a majority of the independent directors of the Company. The independent directors in their capacity as the nominating committeeNominating Committee held onetwo (2) meeting during 2012. 2022.

The Board of Directors believes it is appropriate for the Company’ s independent directors, and not a separateNominating Committee will initially consider nominating committee, to recommend nominees and evaluate candidates due to its belief that all directors should participate in the nomination process. A copy of the Company’s current Corporate Governance Guidelines can be viewed on the Company’s website atwww.optimumbank.com/information-center/corporate-governance.

The Board initially looks to nominating its existing directors for re-election to the Board as appropriate or to other Directordirector nominees proposed, as appropriate, by the directors, and in doing so considers each director’s independence, if required, share ownership, skills, performance and attendance at a minimum of 75% of the Board and respective committee meetings. In evaluating any candidates for potential director nomination, the Board of Directors, and specifically the independent directors,Nominating Committee will consider candidates that are independent, if required, who possess personal and professional integrity, have good business judgment, relevant experience and skills, including banking, financial, real estate and/or legal expertise, who would be effective as a Directordirector in conjunction with the full Board, who would commit to attend Board and committee meetings, and whose interests are aligned with the long-term interests of the Company’s shareholders.

The Board, including its independent directors,Nominating Committee will consider director candidates recommended by shareholders, provided the recommendation is in writing and delivered to the Corporate Secretary of the Company at the principal executive offices of the Company not later than the close of business on the 120th120^th day prior to the first anniversary of the date on which the Company first mailed its proxy materials to shareholders for the preceding year’s annual meeting of shareholders. For the 20142024 annual meeting, recommendations must be received by December 5, 2013.[_________], 2023. The nomination and notification must contain the nominee’s name, address, principal occupation, total number of shares owned, consent to serve as a director, and all information relating to the nominee and the nominating shareholder as would be required to be disclosed in solicitation of proxies for the election of such nominee as a director pursuant to the SEC’s proxy rules.

www.optimumbank.comHedging Policy/information-center/corporate-governance.

The Company has not adopted a policy concerning hedging of the Company’s shares, although it plans to do so following the annual meeting. Accordingly, executive officers and directors of the Company are currently permitted to engage in hedging shares of the Company’s common stock, including, but not limited to, engaging in short sales or trading in puts, calls, covered calls or other derivative products.

Board Leadership Structure and Role in Risk Oversight

The Company’s policy is to separate the roles of chairmanChairman and chief executive officerChief Executive Officer of the Company have been separate since December 2011. Mr.Company. At the present time, Moishe Gubin currently serves as chairman. Prior to February 2013, Richard Browdy served as the Company’s chief executive officer. Mr. Browdy resigned in February, 2013. Chairman of the Board.

The Board believes that risk management is an important component of the Company’s corporate strategy. While we assess specific risks at the Company’s committee levels, the Board, as a whole, oversees the Company’s risk management process, and discusses and reviews with management major policies with respect to risk assessment and risk management. The Board is regularly informed through committee reports about the Company’s risks. The Audit Committee reviews and assesses the Company’s processes to manage financial and financial reporting risk. It also reviews the Company’s policies for risk assessment and assesses steps management has taken to control significant risks. The Compensation Committee oversees risks relating to compensation practices and policies.

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PROPOSAL NO. 2

APPROVAL OF THE ISSUANCE AND SALEOF UP TO 11,113,889 SHARES OF COMMON STOCK TO MOISHE GUBINUPON CONVERSION OF THE SERIES B PREFERRED STOCK PREVIOUSLY ISSUED BY THE COMPANY

The following discussion of the Gubin transaction is qualified by reference to the Amended and Restated Stock Purchase Agreement filed as Exhibit A to this proxy statement.

Summary of the Gubin Transaction

On March 22, 2013, the Company and Moishe Gubin entered into an amended and restated stock purchase agreement which provides for the issuance and sale of 7,333,333 shares of Company common stock, $0.01 par value, to Mr. Gubin at a price of $0.30 per share (the “Stock Purchase Agreement”). Mr. Gubin currently serves as a Chairman of the Company and the Bank.

The closing of the transactions contemplated by the Stock Purchase Agreement (the “Gubin Transaction”) is subject to certain conditions, including approval of the transaction by the shareholders of the Company, the Federal Reserve and the State of Florida Office of Financial Regulation.

If these conditions are fulfilled, the Company would receive proceeds from the transaction of $2,200,000. The agreement terminates if the conditions are not fulfilled and the closing does not occur by September 30, 2013.

The Company will also grant Mr. Gubin certain registration rights in connection with the purchase of the shares pursuant to the termsis seeking shareholder approval of a registration rights agreementproposal to be entered into at the closing. Substantially all the proceeds from the Gubin Transaction will be utilized byauthorize the Company to increase the capital of the Bank.

As of March 15, 2013, the Company had 31,511,201 outstanding shares of common stock, including 2,612,143 shares that were owned by Mr. Gubin. Upon the issuance of 7,333,333 additional shares of Company’s common stockissue up to Gubin, and assuming no other issuance of shares of Company common stock, Gubin would own approximately 9,945,47611,113,889 shares of the Company’s common stock or 25.6%upon the conversion, at the option of the total outstanding shares.

Why We Are Seeking Shareholder Approval

The issuanceCompany, of shares in the Gubin Transaction is being submitted to the shareholders at the annual meeting to comply with the shareholder approval requirements of NASDAQ Rule 5635.

Under NASDAQ Rule 5635(b), companies that have securities listed on NASDAQ must obtain shareholder approval prior to the issuance of common stock when the issuanceall or potential issuance would result in a “change of control” as defined by NASDAQ (the “Change of Control Rule”). NASDAQ generally characterizes a transaction whereby an investor or group of investors acquires, or obtains the right to acquire, 20% or more of the voting power of an issuer on a post-transaction basis as a “change of control” for purposes of Rule 5635(b).

Under NASDAQ Rule 5635(c), as interpreted by NASDAQ, companies which have securities listed on NASDAQ must also obtain shareholder approval prior to the issuance of common stock in a private offering to the Company’s executive officers, directors and their affiliates at a price less than the market value per share (the “Insider Purchase Rule”).

Under NASDAQ Rule 5635(d), companies that have securities listed on NASDAQ must obtain shareholder approval prior to the issuance of common stock in a private offering at a price less than the greater of the book and market value per share of such common stock, if the issuance amounts to

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twenty percent (20%) or more of the common stock or twenty percent (20%) or more of the voting power of a company outstanding before the issuance (the “20% Rule”).

The Company’s Board of Directors has submitted this Proposal No. 2 to the Company’s shareholders for approval because the Change of Control Rule, the Insider Purchase Rule and the 20% Rule would apply to issuance of the Company’s common stock in the Gubin Transaction.

The Change of Control Rule applies because the number of shares to be purchased by Mr. Gubin exceeds 20%portion of the outstanding shares of the Company.Company’s Series B Participating Preferred Stock (the “Series B Preferred”). The issuance of the common stock requires the approval of the Company’s shareholders under the Certificate of Designation for Series B Preferred and under Nasdaq Marketplace Rules 5635(b), (c), and (d).

Background

During the period from June 23, 2020 through December 30, 2022, the Company issued 1,360 shares of Series B Preferred at a cash price of $25,000 per share, or an aggregate of $34 million. The outstanding shares of Series B Preferred consists of 760 shares of Series B-1 Preferred, 260 shares of Series B-2 Preferred and 340 shares of Series B-3 Preferred.

Prior Issuance of Series B Preferred

The Insider Purchase Rule applies becauseshares of the Series B Preferred were issued in the following seven transactions:

On June 23, 2020, the Company sold 100 shares of Series B-1 Preferred to Michael Blisko for an aggregate price of $2,500,000. Mr. Gubin isBlisko became a director of the Company andin May 2021.

On September 29, 2020, the current closingCompany sold 180 shares of Series B-1 Preferred to Michael Blisko for an aggregate price of $4,500,000.

On December 28, 2020, the Company sold 120 shares of Series B-1 Preferred to Michael Blisko for an aggregate price of $3,000,000.

On March 24, 2021, the Company sold 160 shares of Series B-1 Preferred to David Gross for an aggregate price of $4,000,000.

On June 24, 2021, the Company sold 200 shares of Series B-1 Preferred to Aaron Mauer for an aggregate price of $5,000,000.

On March 30, 2022, the Company sold 260 shares of Series B-2 Preferred to Empire Indemnity for an aggregate price of $6,500,000. Empire Indemnity is controlled by Moishe Gubin, the Company’s common stock is greater thanChairman, and Mr. Blisko, a director.

On December 30, 2022, the offeringCompany sold 340 shares of Series B-3 Preferred to New York Boys Management, LLC, for an aggregate price of $0.30 per share in$8,500,000. New York Boys Management, LLC is a company controlled by Moishe Gubin, the Gubin Transaction. In this connection, the closing price on March 15, 2013, was $0.50,Company’s Chairman, and Mr. Blisko, a director. These shares were subsequently transferred to Empire Indemnity, which is greater than the $0.30 price to be paid by Mr. Gubin.

The 20% Rule applies because the shares to be sold toan affiliate of Mr. Gubin exceed twenty percent (20%)and Mr. Blisko.

Use of the common stock of the shares of the Company outstanding before the issuance and the current closing price of the Company’s common stock is greater than the offering price of $0.30 per share in the Gubin Transaction.

The approval sought under this Proposal No. 2 will be effective to satisfy the shareholder approval required by the Change of Control Rule, the Insider Purchase Rule and the 20% Rule. Under the NASDAQ Rule 5635, the minimum vote which will constitute shareholder approval of this Proposal No. 2 is a majority of the total votes cast on the proposal in person or by proxy at the special meeting.Proceeds

Background and Reasons for the Transaction with Mr. Gubin

The principal reasonCompany received proceeds of $34 million for the issuancesale of shares under the Stock Purchase Agreement isSeries B Preferred. The Company utilized the proceeds to increasemake capital contributions to the Company’s wholly-owned subsidiary, OptimumBank, to support the capital and growth of OptimumBank in order to assist it in meeting its regulatory capital requirements.OptimumBank.

Starting in 2008 and continuing through 2012,

Certificate of Designation

The Board of Directors initially authorized the Bank has experienced a substantial increase in the level of its non-performing loans, with associated credit losses, as a resultestablishment of the nationwide economic recession and the related collapse in real estate values in south Florida. The Company sustained net lossesSeries B Preferred pursuant to a Certificate of $11.5 million in 2009, $8.5 million in 2010, $3.7 million in 2011 and $4.7 million in 2012. These net losses have significantly reduced shareholders’ equity and the regulatory capital ratios for the Company and the Bank.

As a result of the losses incurred by the Bank and related operating issues, on April 14, 2010 the Bank consented to the issuance of an order (the “Consent Order”) by the Federal Deposit Insurance Corporation (the “FDIC”) andDesignation filed with the State of Florida Officeon June 23, 2020 as an amendment to the Company’s articles of Financial Regulation. On June 22, 2010 the Company entered into a written agreement withincorporation filed (the “Certificate of Designation”). The Certificate of Designation was subsequently amended by the Board of Governors of the Federal Reserve System (the “Federal Reserve”).

The Consent Order requires, among other things, that the Bank to achieveon October 11, 2020, December 29, 2020, July 25, 2021, March 31, 2022 and maintain a tier 1 leverage capital ratio of at least 8.0% of the Bank’s total average assets and a total risk-based capital ratio of at least 12.0% of its total risk-weighted assets by July 14, 2012. At December 31, 2012 the Bank’s tier 1 leverage and total risk-based capital ratios were 8.12% and 11.48%, respectively. At December 31, 2012, the Bank would have needed approximately $600,000 in additional regulatory capital to meet the total risk-based capital ratio required by the Consent Order.

In order to address its declining capital levels and increased capital requirements, in July 2011, the Company commenced an offering of shares of Company’s common stock in a private placement (the “Private Placement”). The Private Placement was approved by the Company’s shareholders at a special meeting held on September 28, 2011.

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The Company received approximately $12,256,000 in the Private Placement through the sale of approximately 30,639,250 shares at a price of $0.40 per share.

Mr. Gubin purchased 2,612,143 shares in the Private Placement and from other shareholders, but was unable to purchase more than 10% of the Company’s shares without obtaining regulatory approval. In response to this limitation, the Company and Mr. Gubin entered into the original Stock Purchase Agreement dated as of October 25, 2011, pursuant to which Mr. Gubin agreed to purchase 6,750,000 shares of common shares at a price of $0.40, or a total of $2,700,000. The Company and Mr. Gubin have subsequently amended this agreement on three occasions2022 in order to provide Mr. Gubin with additional time to obtain required regulatory approvals. Although Mr. Gubin has filed the required applications with Federal Reserve and the State of Florida Office of Financial Regulation, together with several amendments, these agencies have not yet approved the applications. At the time present, neither the Company nor Mr. Gubin are able to predict when or if the applications will be approved.

On March 22, 2013, the Company and Gubin entered into an Amended and Restated Stock Purchase Agreement in order reduce the purchase price from $0.40 per share to $0.30 per share, to increase the number of shares of Series B Preferred that could be issued from 100 shares to 1,520 shares and to designate the first 760 shares as Series B-1 Preferred, to designate the next 260 shares as Series B-2 Preferred and designate the remaining 500 shares as Series B-3 Preferred.

Conversion at the Option of the Company

Under the terms of the Certificate of Designation, the Series B Preferred is convertible, at the option of the Company (but not the holder), into shares of the Company’s common stock, subject to the following conditions:

● the conversion of the Series B Preferred must be approved by the holders of a majority of the outstanding common stock of the Company; and

● the conversion must not result in any holder of the Series B Preferred and any persons with whom the holder may be acting in concert, becoming the beneficial owners of more than 9.9% of the outstanding shares of the Company’s common stock, unless the issuance of shares of common stock to such holder and any persons with whom the holder may be acting in concert, shall have been approved by any and all federal and state banking regulatory authorities whose approval is required for the acquisition of such shares (the “9.9% Ownership Limitation”).

The number of shares of common stock issuable upon the conversion of the Series B Preferred is equal to the initial purchase price of each share of the Series B Preferred (i.e., $25,000) divided by the applicable conversion price.

Conversion Prices

The conversion price for each class of the Series B Preferred is as follows:

The conversion price of each of the class of the Series B Preferred was established by the Company’s Board of Directors at the time it authorized the establishment of such class. The conversion price was established by the Board after considering the market price of the common stock, the book value per share of the common stock, the limited voting rights of the holders of the Series B Preferred, the inability of the holder to convert the Series B Preferred and the absence of any trading market for the Series B Preferred.

Market Price of Company’s Common Stock at the Time of Execution of the Binding Agreements for the Sale of Series B Preferred

On June 23, 2020, the date of the execution of the binding agreement for the initial sale of the Series B-1 Preferred, the market price of the common stock was $2.70 per share. The conversion price of the Series B-1 Preferred is $2.50 per share.

On the execution dates of the binding agreements for the four subsequent sales of the Series B-1 Preferred, the market prices of the common stock were as follows:

On March 30, 2022, the date of the execution of the binding agreement for the sale of the Series B-2 Preferred, the market price of the common stock was $4.13 per share. The conversion price of the Series B-3 Preferred is $4.00 per share.

On December 30, 2022, the date of the execution of the binding agreement for the sale of the Series B-3 Preferred, the market price of the common stock was $4.09 per share. The conversion price of the Series B-3 Preferred is $4.50 per share.

Terms of the Series B Preferred

The Company is currently authorized to issue 1,520 shares of Series B Preferred. The Series B Preferred is divided into three classes: “Series B-1 Preferred”, “Series B-2 Preferred” and “Series B-3 Preferred”. The terms of each class are identical except for the applicable conversion price.

The Company is authorized to issue 760 Shares of Series B-1 Preferred, 260 shares of Series B-2 Preferred and 500 shares of Series B-3 Preferred. As of date of this proxy statement, the Company has 1,360 outstanding shares of Series B Preferred, consisting of 760 Shares of Series B-1 Preferred, 260 shares of Series B-2 Preferred and 340 Shares of Series B-3 Preferred. Accordingly, all of the authorized Series B Preferred has been issued other than 160 shares of Series B-3 Preferred.

Rank

The shares of the Series B Preferred rank senior to all “Junior Securities”, with respect to payment or distribution of assets upon liquidation, dissolution, or winding up of the Company, whether voluntary or involuntary. “Junior Securities” means the common stock and any other class of securities that is specifically designated as junior to the Series B Preferred.

Participating Dividends

Except in the case of liquidation, if the Company declares or pays a dividend or distribution on the common stock, the Company shall simultaneously declare and pay a dividend on the Series B Preferred on a pro rata basis with the common stock determined on an as-converted basis assuming all shares of Series B Preferred had been converted immediately prior to the record date of the applicable dividend.

Liquidation

In the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company (a “Liquidation”), the holders of shares of Series B Preferred then outstanding shall be entitled to be purchasedpaid out of the assets of the Company available for distribution to its shareholders, before any payment shall be made to the holders of Junior Securities by reason of their ownership thereof, an amount per Share equal to the greater of (i) the Series B Original Issue Price of $25,000, or (ii) such amount per share as would have been payable had all shares of Series B Preferred been converted into common stock immediately prior to such Liquidation. This amount is the “Series B Liquidation Amount”.

Voting

Except as provided below, the holders of the Series B Preferred will have no voting rights.

Supermajority Voting Rights—Amendments. The affirmative vote or consent of the holders of at least 66-2/3% of all of the shares of the Series B Preferred at the time outstanding, voting separately as a class (a “Supermajority Interest”), is required to amend the provisions of the Company’s articles of incorporation so as to materially and adversely affect the rights, preferences or privileges of the Series B Preferred, taken as a whole.

Supermajority Voting Rights—Priority. The affirmative vote or consent of a Supermajority Interest of the Series B Preferred is required to issue, authorize or increase the authorized amount of, or to issue or authorize any obligation or security convertible into or evidencing the right to purchase, any class or series of stock ranking senior to the shares of the Series B Preferred with respect to payment of dividends or the distribution of assets upon any Liquidation of the Company.

Company Conversion Right

Subject to the limitations of conversion described below, at any time and from 6,750,000time to 7,333,333,time on or after issuance, the Company shall have the right to convert all or any portion of the outstanding shares of Series B Preferred into an aggregate number of shares of common stock as is determined by (i) multiplying the number of shares (including any fraction of a share) to be converted by the Series B Original Issue Price thereof, and then (ii) dividing the result by the Conversion Price in effect immediately prior to extendsuch conversion.

The initial conversion price per share of Series B-1 Preferred was $2.50 per Share, the outside closing dateinitial conversion price per share of Series B-2 Preferred was $4.00 per Share, and the initial conversion price per share of Series B-3 Preferred was $4.50 per Share. There have been no adjustments to September 30, 2013.the conversion price of any class of the Series B Preferred.

No fractional shares of common stock shall be issued upon conversion of the Series B Preferred. In lieu of any fractional shares to which the holder would otherwise be entitled, the Company shall pay cash equal to such fraction multiplied by the fair market value of a share of common stock as determined in good faith by the Board of Directors of the Company.

ReasonLimitations on Conversion

The right of the Company to convert any of the shares of the Series B Preferred is subject to the prior fulfillment of the following conditions:

(a) Such conversion must be by approved by the holders of a majority of the outstanding common stock of the Company; and

(b) Such conversion must not result in any holder of the Series B Preferred and any persons with whom the holder may be acting in concert, becoming beneficial owners of more than 9.9% of the outstanding shares of the common stock, unless the issuance of shares of common stock to such holder and any persons with whom the holder may be acting in concert, shall have been approved by any and all federal and state banking regulatory authorities whose approval is required for the Gubin Transactionacquisition of such shares. For purposes of this subsection, the term “beneficial owner” has the meaning given to such term in SEC Rule 13d-3 (the “9.9% Ownership Limitation”).

Adjustments to Conversion Price and Number of Conversion Shares

The conversion price and the number of conversion shares issuable on conversion of the shares of Series B Preferred are subject to customary adjustments upon dividend, subdivision, or combination of common stock, and upon any reorganization, reclassification, consolidation or merger. To date, there have been no adjustments to the conversion price and the number of conversion shares.

Preemptive Rights

The holders of shares of Series B Preferred have no preemptive rights with respect to any shares of the Company’s capital stock or any of its other securities convertible into or carrying rights or options to purchase any such capital stock.

Planned Conversion of Series B Preferred

The Company is seeking to complete the Gubin Transaction in order to assist the Bank in meeting the capital requirementsapproval of the Consent OrderCompany’s shareholders to authorize the Company to convert the Series B Preferred into common stock at such times and in such amounts as the Board may determine to increase its lending and investment portfolio.be appropriate, subject to the 9.9% Ownership Limitation.

If this Proposal No. 2 and Proposal No. 3 for the $2.2 million proceedsincrease in authorized common stock are approved by the shareholders, the Board currently plans to convert a portion of the Gubin Transaction had been contributedSeries B Preferred into common stock in December 2023. The number of shares that would be converted at that time would be equal to the Bankmaximum number of shares of common stock that could be issued to each holder based on the 9.9% Ownership Limitation. If Proposal No. 2 is approved and Proposal No.3 is not approved, then the number of shares that would be exchanged would be limited to the amount of authorized but unissued shares of the Company’s common stock.

In the event that the number of shares of Series B Preferred that can be converted for any holder is limited due to the 9.9% Ownership Limitation, then the Board plans to continue to convert additional shares of Series B Preferred on a quarterly basis as permitted by the 9.9% Ownership Limitation, until all of December 31, 3012, the Bank’s Tier 1 leverage and total risk-based capital ratios (on a pro forma basis) would have improved to 9.60% and 13.30%, respectively.outstanding shares Series B Preferred are fully converted into common stock.

The actual improvementnumber of shares of common stock that may be issued upon the conversion of the Series B Preferred in the Bank’s capital ratios after the Gubin Transaction is completedDecember 2023 and thereafter will depend on the closing datenumber of outstanding shares of common stock of the Gubin Transaction;Company at the leveltime of the Bank’s assets and liabilities at that time, the amount of the Bank’s losses between December 31, 2012 and the date of the closing, and the amount of any additional capital received from other sources.

The additional $2.2 million in capital from Mr. Gubin is expected to provide the Company and the Bank with additional working capital to implement the Bank’s business plan, including addressing non-performing loans and funding expanded lending and investment activities.

Reason for the Amended Gubin Transaction

The Board has agreed to amend the terms of the Gubin Transaction in order to reduce the price per share from $0.40 per share to $0.30 per share, and to increaseissuance, the number of shares held by each holder and any person with whom any holder is acting in concert, and whether any holder has received approvals from federal and state banking regulatory authorities to be purchased from 6,750,000acquire shares to 7,333,333 shares. The Company has agreed to these changes becausein excess of the continuing losses incurred by9.9% Ownership Limitation. At the present time, none of the holders has received any approvals from federal and state banking regulatory authorities to acquire shares in excess of the 9.9% Ownership Limitation and no such approvals are currently anticipated.

The following table sets forth the maximum number of shares of common stock that each holder could receive if the Company in 2012 and the decreasewere to exercise its right of conversion based on such holder’s current ownership of the Company’s book value per share from $0.30 at December 31, 2011 to $0.22 at December 31, 2012.common stock.

(1) The Company agreed to increase the number of shares to be purchased in order to partially offset the decrease in the net proceeds of the saleissuable to Mr. Gubin.Blisko is limited because he is currently the beneficial owner of 598,388 shares of common stock.

Transaction Documents

Stock Purchase Agreement.(2) The consummation of the Gubin Transaction is subject to the fulfillment of a number of conditions, including:

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• Gubin obtaining the requisite regulatory approval of the Federal Reserve and the State of Florida Office of Financial Regulation; and

• The Company obtaining shareholder approval of the Gubin Transaction.

The Stock Purchase Agreement may be terminatedshares issuable to Empire Indemnity is limited because Empire Indemnity is controlled by the Company or Gubin if the closing does not occur by September 30, 2013, but not by any party whose failure to perform any obligations under the agreement required to be performed on or prior to such date has been the cause of, or results in, the failure of the transaction to close on or before such date. The Stock Purchase Agreement contains customary representation and warranties.

Registration Rights Agreement.  Under the terms of the Stock Purchase Agreement, the Company has agreed to provide Gubin with certain limited registration rights. The Company has agreed to file a registration statement on Form S-3 as soon as practicable after the closing with respect to the shares sold to Mr. Gubin and Mr. Blisko, who beneficially own 689,815 shares and 598,388 shares, respectively.

(3) The number of shares issuable to use reasonable best efforts to make such registration statement become effective. The CompanyMr. Gross is required to maintain this registration statement continuously in effect until all suchlimited because he is currently the beneficial owner of 245,000 shares have been sold or become eligible for sale without restrictionsof common stock.

All shares of common stock that are issued upon the conversion of the Series B Preferred will constitute “restricted securities” under Rule 144 promulgated underof the Securities Act of 1933, as amended.amended (the “Securities Act”). The Company will not provide any registration rights are subjectwith regard to such shares of common stock. Any shares of common stock issued in the rightconversion would be issued in reliance on the exemption from registration contained in Section 4(a)(2) of the Company to delay registration to avoid disclosure of material nonpublic information. The holder of registrable securities must comply with certain standard provisions facilitating the filing and effectiveness of the registration statementSecurities Act as well.

Purchase Price of the Gubin Transactiona transaction by an issuer not involving a public offering.

 In approving the terms of the Stock Purchase Agreement, the Board considered the fairness, from a financial point of view, the decrease in the price from $0.40 per share to $0.30 per share. The Board determined that the decrease in price was fair in light of the following factors:

  The Board did not engage any third parties to assist the Board in its determination of the offering price due to the Company’s limited resources.

Vote Required and Recommendation of Board of Directors

Assuming the existence

The approval of a quorum, this proposal will be approved if the number of shares voted in favor of this Proposal No. 2 exceedsrequires the numberaffirmative vote of shares voted against the majority of the votes cast for this proposal. As such, abstentions and broker non-votes will not affect the outcome of the vote, but will be counted for determining the existence of a quorum.quorum

Board Recommendation for Proposal No. 2

The Board determined that Proposal No. 2 is advisable and in the best interest of our shareholders and recommended that our shareholders vote in favor of Proposal No. 2.

In reaching its determination to approve Proposal No. 2, the Board considered a number of factors, including:

● the conversion of the Series B Preferred would eliminate the Series B Preferred, which would facilitate the Company’s ability to issue future series of preferred stock, because the Series B Preferred is entitled to be senior to any other class of preferred stock;

● the conversion of the Series B Preferred would eliminate the liquidation preference of Series B Preferred;

● the conversion of the Series B Preferred would increase the total number of shares of common stock that could potentially be sold into the existing public market, subject to applicable securities laws, which could facilitate the development of a more robust public market for the common stock;

● our financial condition, results of operations, cash flow and liquidity, including our outstanding debt obligations, which required us to raise additional capital for ongoing cash needs;

● the willingness of the holders of the Series B Preferred to make further investments in the Company following the conversion of the Series B Preferred;

● the interests of Moishe Gubin, our Chairman, and Michael Blasio, one of our directors, in the conversion by virtue of their beneficial ownership of the Series B Preferred;

● the dilution to our current common shareholders that would occur upon the conversion of the Series B Preferred.

In view of the variety of factors considered in connection with the evaluation of the conversion of the Series B Preferred and the complexity of these matters, the Board did not find it practicable to, and did not, quantify or otherwise attempt to assign any relative weight to the various factors considered. In addition, in considering the various factors, individual members of the Board may have assigned different weights to different factors.

After evaluating these factors for and against the conversion of the Series B Preferred, and based upon their knowledge of our business, financial condition and prospects, potential financing alternatives (or lack thereof), and the views of our management, the Board concluded that the conversion of the Series B Preferred is in our best interest and in the best interests of our shareholders, and recommends that all shareholders vote “FOR” the approval of Proposal No. 2.

NASDAQ Stockholder Approval Requirements

Our common stock is listed on The NASDAQ Stock Market (“NASDAQ”) and trades under the ticker symbol OPHC. The approval of the conversion of the Series B Preferred requires shareholder approval under NASDAQ Rules 5635(b), 5635(c) and 5635(d).

NASDAQ Marketplace Rule 5635(b) requires shareholder approval of security issuances when the issuance or potential issuance will result in a change of control of the company. NASDAQ has generally taken the position that any issuance that results in an investor or group of investors obtaining a 20% or greater interest or a right to acquire that interest on a post-transaction basis, and that ownership position would be the largest position in the company, would be presumed to be a change of control. Assuming the full conversion of the Series B Preferred and the receipt of all required regulatory approvals, it is possible that Moishe Gubin or Michael Blisko or one of their affiliates could become the owner of more than 20% of the voting power of the Company on a post-transaction basis and be the Company’s largest shareholder. By approving Proposal No. 2, you are approving the proposal for purposes of the requirements under NASDAQ Marketplace Rule 5635(b), which may result in Moishe Gubin or Michael Blisko or one of their affiliates obtaining a greater than 20% interest in the Company on a post-transaction basis, which ownership position would be the largest position in the Company.

NASDAQ Marketplace Rule 5635(c) requires shareholder approval of security issuances at below fair market value made to officers, directors, employees or consultants, or affiliated entities of any such persons. Proposal No. 2 will result in shares of common stock being issued to directors Moishe Gubin and Michael Blisko and certain of their affiliates at a price which may be deemed to be below the fair market value of our common stock at the time the Company sold the Series B Preferred to these holders (as described above). By approving Proposal No. 2, you are approving the proposal for purposes of the requirements under NASDAQ Marketplace Rule 5635(c), which may result in Moishe Gubin or Michael Blisko or one of their affiliates acquiring shares of common stock at a price of less than fair market value.

NASDAQ Marketplace Rule 5635(d) requires shareholder approval in connection with a transaction other than a public offering involving the sale or issuance by the issuer of common stock (or securities convertible into or exchangeable for common stock) equal to 20% or more of the common stock or 20% or more of the voting power outstanding before the issuance for a price that is less than the greater of the “Minimum Price.” For purposes of Rule 5635(d), the “Minimum Price” means a price that is the lower of: (i) the Nasdaq Official Closing Price immediately preceding the signing of the binding agreement; or (ii) the average Nasdaq Official Closing Price of the common stock (for the five trading days immediately preceding the signing of the binding agreement. In the case of the Series B Preferred, the conversion price of the Series B Preferred was lower than the Minimum Price in the case of six of the seven sales of the Series B Preferred, as reflected in the following table:

Based on the Minimum Price of our common stock on each date on which the Company entered into binding agreements to sell shares of the Series B Preferred, the Minimum Price was less than the conversion price for such share, expect in the case of the shares of the Series B-3 Preferred. As noted above, the conversion of these shares could result in the issuance of common shares representing more than 20% of our common stock.

We are requesting in this Proposal No. 2 that our shareholders approve the issuance of the common stock issuable upon conversion of the Series B Preferred in accordance with NASDAQ Marketplace Rules 5635(b), (c), and (d).

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS ATHAT SHAREHOLDERS VOTE FOR“FOR” APPROVAL OF POTENTIALTHE ISSUANCE AND SALEOF UP TO MR. GUBIN OF 7,333,33311,113,889 SHARES OF THE COMPANY’S COMMON STOCK AT A PRICEUPON CONVERSION OF $0.30 PER SHARETHE SERIES B PREFERRED STOCK PREVIOUSLY ISSUED BY THE COMPANY .

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PROPOSAL NO. 3

APPROVALAMENDMENT TO THE COMPANY’S ARTICLES OF REVERSEINCORPORATION TO INCREASE AUTHORIZED SHARES OF COMMON STOCK SPLIT

Overview

The Company’s board of directors has unanimously approved a proposal to amend its articles of incorporation to implement a reverse stock split (the “Reverse Stock Split”), pursuant to which every four outstanding shares ofincrease the Company’s common stock would be combined into one outstanding share of the Company’s common stock on a record date to be established by the Company’s Board of Directors following the annual meeting.

The amendment will not change the number of authorized shares of common stock or preferred stock, or the relative voting power of the Company’s shareholders. Because the number of authorizedCompany from 10,000,000 shares will notto 30,000,000 shares, subject to stockholder approval. The board has declared this amendment to be reduced, the number of authorized but unissued shares ofadvisable and recommended that this proposal be presented to the Company’s common stock will materially increase and will be availablestockholders for reissuance by the Company. The Reverse Stock Split would affect all of the holders of the Company’s common stock uniformly.approval.

The Board unanimously approved and recommended seeking shareholder approval of the Reverse Stock Split on March 22, 2013.

If the shareholdersCompany’s stockholders approve this Proposal No. 3, the Reverse Stock Split,Company expects to file articles of amendment to the Board will effectCompany’s articles of incorporation with the Reverse Stock Split promptly after the annual meeting on a record date to be announced at least 15 days in advance.

Following the Reverse Stock Split, the numberSecretary of State of the Company’s outstanding sharesState of common stock will be reduced from 31,511,201 shares to 7,877,800 shares. The Reverse Stock Split will also affectFlorida. Upon filing, the Company’s outstanding stock options and sharesarticles of common stock issued underamendment the Company’s Equity Incentive Plan. Under this plan, theauthorized number of shares of common stock deliverable upon exercise or grant must be appropriately adjustedwill increase from 10,000,000 to 30,000,000.

On the date of this proxy statement, the Company had an aggregate of 7,250,218 outstanding shares of common stock outstanding and appropriate adjustments must be made tohad 39,318 shares of common stock available for issuance under the purchase price per share to reflectCompany’s stock option plan. If the Reverse Stock Split. The Reverse Stock Split will also affectshareholders approve the termsconversion of the Gubin Transaction, withSeries B Preferred as set forth in Proposal No. 2, the Company could potentially issue up to 11,113,889 additional shares of common stock. If the shareholders approve the increase in the number of shares tothat may be purchased to be reducedissued under the Company’s stock option plan from 7,333,333550,000 shares to 1,833,333, and the purchase price to be increased from $0.30 per share to $1.20 per share.

The Reverse Stock Split is not being proposed1.050,000 shares as described in response to any effort of whichProposal No. 4, the Company is awarecould potentially issue up to accumulate the500,000 additional shares of the Company’s common stock or obtain controlstock. If all of the Company, nor is it a plan by management to recommend a series of similar actions to the Board or our shareholders.

There are certain risks associated with the Reverse Stock Split, and we cannot accurately predict or assure the Reverse Stock Split will produce or maintain the desired results (for more information on the risks see the section below entitled “Certain Risks Associated with the Reverse Stock Split”). However, the Board believes that the benefits toforegoing shares were issued, the Company and its shareholders outweigh the risks and recommends that you vote to approve the Reverse Stock Split.would have 18,903,425 outstanding shares of common stock.

Reasons for the Reverse Stock SplitIncrease in Authorized Shares

The primary purposereason for effecting the Reverse Stock Split would be to increase the per share price of the Company’s common stock. The Board of Directors believes that effecting the Reverse Stock Split would, among other things, help the Company to:

• Meet certain continued listing requirements of NASDAQ; and

• Appeal to a broader range of investors to generate greater investor interest in the Company.

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Meet Continued NASDAQ Listing Requirements.

Our common stock is listed on the NASDAQ under the symbol “OPHC.” In August 2012, the NASDAQ provided notice to the Company that the decline in the share price of the Company’s common stock had caused it to be out of compliance with one of the NASDAQ’s continued listing standards. The NASDAQ listing rules require the closing bid price of a listed company’s common stock to be at least $1.00 per share. The Company’s trading price has been below $1.00 per share since May 9, 2012. On March 15, 2013, the closing trading price was $0.50.

Under the NASDAQ’s rules, in order to regain compliance with the listing standard, the Company’s closing bid price must be at least $1.00 within six months following receipt of the non-compliance notice. Notwithstanding the foregoing, if the Company determines to remedy the non-compliance by taking action that will require shareholder approval, such as the Reverse Stock Split, the NASDAQ will continue to list the Company’s common stock pending shareholder approval by no later than its next annual meeting, and the implementation of such action promptly thereafter. The Company will regain compliance with its listing standard if the share price promptly exceeds $1.00 per share for a period of ten business days.

The Board expects that the Reverse Stock Split will increase the price of the Company’s common stock above $1.00 per share at the effective date of the reverse split. The stock price following the effective date of the stock split will depend on a variety of factors, including the Company’s operating results.

Appeal to a Broader Range of Investors to Generate Greater Investor Interest in the Company.

Anproposed increase in the Company’s stock price may make its common stock more attractiveauthorized shares is to investors. Brokerage firms may be reluctant to recommend lower-priced securities to their clients. Many institutional investors have policies prohibiting them from holding lower-priced stocks in their portfolios, which reducesfacilitate the number of potential purchasers of our common stock. Investment funds may also be reluctant to invest in lower-priced stocks. Investors may also be dissuaded from purchasing lower-priced stocks because the brokerage commissions, as a percentage of the total transaction, tend to be higher for such stocks. Moreover, the analysts at many brokerage firms do not monitor the trading activity or otherwise provide coverage of lower-priced stocks. The Board believes that the Reverse Stock Split would assist the Company in addressing these issues.

Certain Risks Associated with the Reverse Stock Split

Even if the Reverse Stock Split is effected, some or all of the expected benefits discussed above may not be realized or maintained. The market price of the Company’s common stock will continue to be based, in part, on the Company’s performance and other factors unrelated to the number of shares outstanding.

The Reverse Stock Split will reduce the number of outstanding shares of the Company’s common stock without reducing the number of shares of available but unissued common stock, which will also have the effect of increasing the number of authorized but unissued shares. The issuancesale of additional shares of the Company’s common stock mayin order to provide additional capital to the Bank in order to support its continued growth. In this regard, the Bank’s total assets have a dilutive effect ongrown from $235 million at December 31, 2020 to $585 million at December 31, 2022. The Company currently expects that the ownershipBank will be able to continue its rapid growth provided that the Company raises additional capital to support such growth. The Company intends to raise such additional capital in 2023 through one or more public or private offerings of existing shareholders.

Principal Effectsshares. The Company has not entered into any agreements or commitments with respect to any such offering and the terms of such offerings have not been determined. The authorization of the Reverse Stock Split

If the shareholders approve the Reverse Stock Split, the issued and outstanding shares of common stock would combined at a rate of one (1) share of common stock for every four (4) shares of common stock currently outstanding. The Reverse Stock Split would be effected simultaneously for all of the common stock, and the exchange ratio would be the same for all shares of common stock. The Reverse

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Stock Split would affect all shareholders uniformly and would not affect any shareholder’s percentage ownership interests in the Company.

The Reverse Stock Split would not affect the relative voting or other rights that accompany the shares of our common stock. common stock issued pursuant to the Reverse Stock Split would remain fully paid and non-assessable. The Reverse Stock Split would not affect the Company’s securities law reporting and disclosure obligations, and the Company would continue to be subject to the periodic reporting requirements of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The Board has no current plans to take the Company private. Accordingly, the Reverse Stock Split is not related to a strategy to do so.

In addition to the change in the number of shares of common stock outstanding, the Reverse Stock Split would have the following effects:

Increase the Per Share Price of the Company’s Common Stock. By effectively condensing four pre-split shares into one share of common stock, the per share price of a post-split share is generally greater than the per share price of a pre-split share. The amount of the initial increase in per share price and the duration of such increase, however, is uncertain.

Increase in the Number of Shares of Common Stock Available for Future Issuance. By reducing the number of shares outstanding without reducing the number of shares of available but unissued common stock, the Reverse Stock Split will increase the number of authorized but unissued shares. The Board believes theproposed increase is necessary in orderexpected to provide the Company with the ability to raiseissue enough additional fundsshares to meet its capital requirements for at least the Company’s capital requirements.

The following table contains approximate information relating to the Company’s common stock, based on share information as of March 15, 2013:

Although the Reverse Stock Split would not have any dilutive effect on the Company’s shareholders, the Reverse Stock Split without a reduction in the number of shares authorized for issuance would reduce the proportion of shares owned by the Company’s shareholders relative to the number of shares authorized for issuance, giving the Company’s Board an effective increase in the authorized shares available for issuance, in its discretion. The Board from time to time may deem it to be in the best interests of the Company and its shareholders to issue shares of the Company’s common stock to raise capital and for other purposes. If the Company’s Board authorizes the issuance of additional shares subsequent to the Reverse Stock Split described above, the dilution to the ownership interest of the Company’s existing shareholders may be greater than would occur had the Reverse Stock Split not been effected.

Many stock issuances not involving equity compensation do not require shareholder approval, and the Company’s Board generally seeks approval of the Company’s shareholders in connection with a proposed issuance only if required at that time.

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Require AdjustmentThe secondary reason for the proposed increase is to Currently Outstanding Securities Exercisable or Convertible into Shares ofprovide the Company’s Common Stock. The Reverse Stock Split would effect a reduction in theCompany with sufficient shares to be able to reserve as sufficient number of shares of common stock issuable uponto permit the exercise orissuance of the proposed increased number of shares under the Company’s stock option and to permit the conversion of the Company’s outstandingSeries B Preferred into common stock optionswhen approved by the Company and the shareholders.

In the case of the stock option plan, the Company is separately seeking shareholder approval in proportionProposal No. 4 to increase the Reverse Stock Split ratio. Additionally, the exercise price of outstanding options would increase, likewise in proportion to the reverse stock split ratio.

Require Adjustments to Number of Shares of Common Stock Available for Future Issuance under the Company’s Equity Incentive Plan.    In connection with any reverse split, the Company’s Board would also make a corresponding reduction in theauthorized number of shares available with respect to options grantedthat may be issued under the Company’s Equity Incentive Plan so asplan from 550,000 to avoid1,050,000.

In the effectcase of increasing the valueSeries B Preferred, the Company is separately seeking shareholder approval in Proposal No. 2 to permit the Company, at its option, to convert up to 1,360 outstanding shares of options previously granted.

Authorized Shares of Common Stock. The Reverse Stock Split will not change the number of authorizedSeries B Preferred into 11,113,889 shares of common stock but willstock.

The increase in the authorized number of authorized shares available for future issuance from 18,488,799common stock would provide the Company with sufficient shares to 42,122,200 shares. Thesebe able to issue the additional shares would be available for corporate needs such as equity financing, retirement of outstanding indebtedness,under the stock splitsoption plan and to convert its Series B preferred stock dividends, employee benefit plans, or other corporate purposes as may be deemed byinto common stock in the event that the Board to bedetermines that such conversion is in the best interests of the Company and its shareholders. The Board believesapproval of the increase of the authorized shares will not constitute shareholder approval for increase in the shares available under the stock option plans or approval of the conversion of the Series B Preferred, which are being sought separately by the Company in Proposal No. 2 and Proposal No. 4.

If Proposal No.3 is approved, then the Company would reserve an additional 500,000 shares for issuance under the plan and 11,113,889 shares for issuance upon the conversion of the Series B Preferred. After taking account of the 7,250,218 currently outstanding common shares of the Company, the Company would then have 11,096,575 shares available for issuance for other purposes.

The Company desires to have additional shares available for other business and financial purposes in the future. The additional shares may be used for various purposes without further stockholder approval, except as may be required by applicable law, regulations promulgated by government agencies, the rules of the NASDAQ or other market or exchange on which Company common stock is then listed. These purposes may include, among others:

● providing equity incentives to employees, officers or directors;

● establishing strategic relationships with other companies; and

● expanding the business of the Company through the acquisition of other financial institutions.

The terms of additional shares of common stock will be identical to those of the currently outstanding shares of the Company’s common stock. However, because holders of the Company’s common stock have no preemptive rights to purchase or subscribe for any unissued stock of the Company, the issuance of any additional shares of common stock authorized as a result of the increase in available shares for future issuance is appropriate to fund the future operations of the Company and to address its capital requirements. As a result, the Company’s current number of authorized shares of common stock may enablewill reduce the Company to better meet its future business needs.

Procedure for Effecting Reverse Stock Split and Exchangecurrent stockholders’ percentage of Stock Certificates

Ifownership interest in the Reverse Stock Split is approved by the Company’s shareholders, the Company’s Board will promptly establish the record date for the Reverse Stock Split.

The Company would then file a certificate of amendment to the Company’s Articles of Incorporation with the Secretary of the State of Florida at such time as the Company’s Board of Directors had determined as the appropriate effective time for the Reverse Stock Split to effect the reverse split. The articles of amendment would add a new provision providing that holders of the Company’s common stock immediately prior to the filing of the amendment will receive one share of common stock for each four shares held on the record date selected by the Board. A copy of the proposed amendment is attached to this proxy statement as Exhibit B and is considered a part of this proxy statement.

For example, if a shareholder presently holds 100 shares of the Company’s common stock, he or she would hold 25total outstanding shares of common stock following the Reverse Stock Split.stock.

Beginning on the effective date

Effects of the split, each certificate representing pre-split shares would be deemed for all corporate purposes to evidence ownership of post-split shares.

As soon as practicable after the effective date of the Reverse Stock Split, shareholders would be notified that the reverse stock split had been effected.

Effect on Beneficial Holders (i.e., Shareholders Who HoldIncrease in “Street Name”)Authorized Shares

Upon the Reverse Stock Split, we intend to treat common stock held by shareholders in “street name,” through a bank, broker or other nominee,

The proposed increase in the same manner as shareholders whose shares are registered in their own names. Banks, brokers or other nominees will be instructed to effect the Reverse Stock Split for their customers holding common stock in “street name.”

However, these banks, brokers or other nominees may have different procedures than registered shareholders for processing the Reverse Stock Split. If you hold shares of common stock with a bank,

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broker or other nominee and have any questions in this regard, you are encouraged to contact your bank, broker or other nominee.

Effect on Registered “Book-Entry” Holders (i.e., Shareholders That are Registered on the Transfer Agent’s Books and Records but do not Hold Certificates)

Some of the Company’s registered holders of common stock may hold some or all of their shares electronically in book-entry form with the Company’s transfer agent, Continental Stock Transfer. These shareholders do not have stock certificates evidencing their ownership of common stock. They are, however, provided with a statement reflecting the number of shares registered in their accounts. If a shareholder holds registered shares in book-entry form with the Company’s transfer agent, no action needs to be taken to receive post reverse stock split shares. If a shareholder is entitled to post-Reverse Stock Split shares, a transaction statement will automatically be sent to the shareholder’s address of record indicating theauthorized number of shares of common stock held following the Reverse Stock Split.

Effect on Certificated Shares

Upon the Reverse Stock Split, the Company’s transfer agent will act as the Company’s exchange agent and assist holderscould have a number of common stock in implementing the exchange of their certificates.

Commencingother effects on the effective datestockholders of the Reverse Stock Split, shareholders holding shares in certificated form will be sent a transmittal letter byCompany depending upon the Company’s transfer agent.exact nature and circumstances of any actual issuances of authorized but unissued shares. The letter of transmittal will contain instructions on how a shareholder should surrender his or her certificates representing common stock (“Old Certificates”) to the transfer agent in exchange for certificates representing the appropriate number of whole post-Reverse Stock Split common stock, as applicable (“New Certificates”). No New Certificates will be issued to a shareholder until that shareholder has surrendered all Old Certificates, together with a properly completed and executed letter of transmittal, to the transfer agent. No shareholder will be required to pay a transfer or other fee to exchange Old Certificates. The letter of transmittal will contain instructions on how you may obtain New Certificates if your Old Certificates have been lost. If you have lost your certificates, you will have to pay any surety premium and the service fee required by the Company’s transfer agent.

Until surrendered, we will deem outstanding Old Certificates held by shareholders to be canceled and only to represent the number of whole shares to which these shareholders are entitled.

Any Old Certificates submitted for exchange, whether because of a sale, transfer or other disposition of shares, will automatically be exchanged for New Certificates.

Shareholders should not destroy any stock certificates and should not submit any certificates until requested to do so by the transfer agent. Shortly after the Reverse Stock Split the transfer agent will provide registered shareholders with instructions and a letter of transmittal for converting Old Certificates into New Certificates. Shareholders are encouraged to promptly surrender Old Certificates to the transfer agent (acting as exchange agent in connection with the reverse stock split) in order to avoid having shares become subject to escheat laws.

Fractional Shares

No fractional shares of Common Stock shall be issued in connection with the Reverse Stock Split. Rather, fractional shares created as a result of the Reverse Stock Split shall be rounded up to the next largest whole number, such that, in lieu of fractional shares, each shareholder who otherwise would be entitled to receive fractional shares of Common Stock as a result of the Reverse Stock Split shall instead be entitled to receive the next largest whole number of shares of Common Stock.

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Accounting Matters

The par value of the Company’s common stock would remain unchanged at $0.01 per share, if the Reverse Stock Split is effected.

The Company’s shareholders’ equity in its consolidated balance sheet would not change in total. However, the Company’s stated capital (i.e., $0.01 par value times the number of shares issued and outstanding), would be proportionately reduced based on the reduction in shares of common stock outstanding. Additional paid in capital would be increased by an equal amount, which would result in no overall change to the balance of shareholders’ equity.

Additionally, net income or loss per share for all periods would increase proportionately as a result of the Reverse Stock Split since there would be a lower number of shares outstanding. We do not anticipate that any other material accounting consequences would arise as a result of the Reverse Stock Split.

Potential Anti-Takeover Effect

Even though the potential Reverse Stock Split would result in an increased proportion of unissued authorized shares to issued shares, which could under certain circumstances, have an anti-takeover effect, (forin that additional shares could be issued (within the limits imposed by applicable law) in one or more transactions that could make a change in control or takeover of the Company more difficult. For example, additional shares could be issued by permitting issuances that wouldthe Company so as to dilute the stock ownership or voting rights of a personpersons seeking to effect a change in the composition of the Board or contemplating a tender offer or other transaction for the combination of us with another company), the Reverse Stock Split is not being proposed in response to any effort of which we are aware to accumulate shares of the Company’s common stock or obtain control of us, nor is it partthe Company. Similarly, the issuance of a plan by managementadditional shares to recommend a series of similar amendments to the Company’s Board and the Company’s shareholders.

No Appraisal Rights

The Company’s shareholders are not entitled to appraisal rights with respect to the Reverse Stock Split, and the Company will not independently provide shareholders with any such right.

Federal Income Tax Consequences of the Reverse Stock Split

The following discussion is a summary of certain U.S. federal income tax consequences of the Reverse Stock Split to the Company and to shareholders that hold shares of common stock as capital assets for U.S. federal income tax purposes. This discussion is based upon provisions of the U.S. Internal Revenue Code of 1986, as amended (the “Code��), the Treasury regulations promulgated under the Code, and U.S. administrative rulings and court decisions, all as in effect on the date hereof and all of which are subject to change, possibly with retroactive effect, and differing interpretations. Changes in these authorities may cause the U.S. federal income tax consequences of the Reverse Stock Split to vary substantially from the consequences summarized below.

This summary does not address all aspects of U.S. federal income taxation that may be relevant to shareholders in light of their particular circumstances or to shareholders who may be subject to special tax treatment under the Code, including, without limitation, dealers in securities, commodities or foreign currency, persons who are treated as non-U.S. persons for U.S. federal income tax purposes, certain former citizens or long-term residents of the United States, insurance companies, tax-exempt organizations, banks, financial institutions, small business investment companies, regulated investment companies, real estate investment trusts, retirement plans, persons that are partnerships or other pass-through entities for U.S. federal income tax purposes, persons whose functional currency is not the U.S. dollar, traders that mark-to-market their securities, persons subject to the alternative minimum tax, persons who hold their shares of common stock as part of a hedge, straddle, conversion or other risk reduction transaction, or who acquired their shares of common stock pursuant to the exercise of

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compensatory stock options, the vesting of previously restricted shares of stock or otherwise as compensation. If a partnership or other entity classified as a partnership for U.S. federal income tax purposes holds shares of common stock, the tax treatment of a partner thereof will generally depend upon the status of the partner and upon the activities of the partnership. If you are a partner in a partnership holding shares of the Company’s common stock, you should consult your tax advisor regarding the tax consequences of the Reverse Stock Split.

The Company has not sought and will not seek an opinion of counsel or a ruling from the Internal Revenue Service (“IRS”) regarding the federal income tax consequences of the Reverse Stock Split. The state and local tax consequences of the reverse split may vary as to each shareholder, depending on the jurisdiction in which such shareholder resides. This discussion should not be considered as tax or investment advice, and the tax consequences of the Reverse Stock Split may not be the same for all shareholders. Shareholders should consult their own tax advisors to know their individual federal, state, local and foreign tax consequences.

Tax Consequences to the Company.  The Company believes that the Reverse Stock Split will constitute a reorganization under Section 368(a)(1)(E) of the Internal Revenue Code. Accordingly, the Company should not recognize taxable income, gain or loss in connectionallied with the Reverse Stock Split. In addition, we do not expectCompany’ management could have the Reverse Stock Spliteffect of making it more difficult to affectremove the Company’s abilityCompany’ management by diluting the stock ownership or voting rights of persons seeking to utilize the Company’s net operating loss carryforwards.cause such removal.

Tax Consequences to Shareholders.  Shareholders should not recognize any gain or loss for U.S. federal income tax purposes as a result of the Reverse Stock Split. Each shareholder’s aggregate tax basis in the common stock received in the Reverse Stock Split, should equal the shareholder’s aggregate tax basis in the common stock exchanged in the Reverse Stock Split. In addition, each shareholder’s holding period for the common stock it receives in the Reverse Stock Split should include the shareholder’s holding period for the common stock exchanged in the Reverse Stock Split.

Interests of Directors and Executive Officers

The Company’s directors and executive officers have no substantial interests, directly or indirectly, in the matters set forth in this Reverse Stock Split except to the extent of their ownership of shares of the Company’s common stock. The approval of the Reverse Stock Split will not affect the proposed sale of shares to Moishe Gubin because the Company has a sufficient number of authorized shares to complete this transaction regardless of whether the Reverse Stock Split is approved.

Vote Required; Recommendation of Company Board of Directors

Assuming the existence of a quorum, the affirmative vote of the majority of the votes cast for this proposal will be required for approval. As such, abstentions and broker non-votes will not affect the outcome of the vote, but will be counted for determining the existence of a quorum

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT STOCKHOLDERS VOTE “FOR” PROPOSAL NO. 3 TO APPROVE AN AMENDMENT TO ARTICLES OF INCORPORATION TO INCREASE THE NUMBER OF AUTHORIZED SHARES OF THE COMMON STOCK TO 30,000,000 SHARES.

PROPOSAL NO. 4

APPROVAL OF AN AMENDMENT TO THE COMPANY’S 2018 EQUITY INCENTIVE PLAN TO INCREASE THE NUMBER OF SHARES THAT MAY BE ISSUED UNDER THE PLAN

The Company has adopted the 2018 Equity Incentive Plan. The plan allows the Company to provide equity compensation to employees and directors, under a shareholder-approved plan, and enables the Company to attract and retain qualified persons to serve as directors and officers.

As of the date of this proxy statement, the Company has issued 542,682 shares under the plan. As a result, there are only 39,318 additional shares available for issuance under the plan.

The Board of Directors of the Company believes that equity compensation is a key aspect of the Company’s ability to attract and retain qualified directors and officers. During 2022, the Company issued 67,182 shares to Moishe Gubin, as part of his compensation for his services as a Director, and 2,944 shares to Timothy Terry, as part of his compensation for his services as President of the Bank. The Company granted an additional 24,493 shares to other employees in 2022. The Company has no outstanding stock options or other equity awards.

The Board has approved ifan amendment to increase the aggregate number of shares of common stock authorized for issuance under the plan from 550,000 to 1,050,000 shares, subject to shareholder approval, in order to ensure that the Company is able to continue to grant equity compensation at levels determined appropriate by the Board.

Summary of the Plan

The principal features of the plan are summarized below.

Plan Administration. The plan is administered by our Board of Directors, a majority of whom meet the NASDAQ standard for director independence, and/or our Board’s Compensation Committee, which consists of at least two members of the Board, each of whom meets the NASDAQ standard for director independence. The Board through its Compensation Committee, has the sole authority, among other things, to:

● Select participants and grant awards,

● Determine the number of shares votedto be subject to the types of awards,

● Determine the terms and conditions upon which awards will be granted under the plan, including the vesting requirements of awards,

● Prescribe the form and terms of award agreements,

● Establish procedures and regulations for the administration of the plan,

● Interpret the plan, and

● Make all determinations necessary or advisable for administration of the plan.

Eligibility. The directors and employees of the Company and its subsidiaries are eligible to participate in favorthe plan.

Awards. The plan provides for the grant of this Proposal No. 3 exceedsincentive and non-statutory options, bonus shares, restricted shares, and performance shares, as such terms are defined in the plan.

Shares Subject to the Plan. If the amendment is approved, the number of shares voted againstof common stock that may be issued under the proposal.plan will increase from 550,000 shares to 1,050,000 shares. If any shares are subject to an award under the plan that is forfeited, cancelled, expires, lapses or otherwise terminates without the issuance of such shares, those shares will again be available for grant under the plan. Likewise, shares that are tendered to the Company by a participant as full or partial payment of the exercise price of any stock option granted under the plan or in payment of any withholding tax incurred in connection with any award under the plan will be available for issuance under the plan. The shares issued under the plan may consist, in whole or in part, of authorized but unissued shares or treasury shares.

Adjustments. In the event of a merger or consolidation (in each case where the shares of the Company are converted into stock and/or cash of another entity), or any corporate structure affecting Company common stock, adjustments and other substitutions will be made to the plan, including adjustments in the maximum number of shares subject to the plan and other numerical limitations. Adjustments will also be made to awards under the plan as the Board in its sole discretion deems equitable or appropriate.

Options. Incentive and non-statutory options to purchase shares of Company common stock may be granted under the plan, either alone or in addition to other awards and for no consideration or for such consideration as the Board and/or Compensation Committee may determine or as may be required by applicable law. The price at which a share may be purchased under an option may not be less than the market value of a share on the date the option is granted. Market value means the last reported sale price of Company common stock reported on The Nasdaq Capital Market on the relevant date of determination. The plan permits the Board and/or Compensation Committee to establish the term of each option, but its term may not exceed ten years. Options may be exercised for whole shares only. If an option would otherwise be exercisable for fractional shares, the option is rounded down to the nearest whole share amount. Options may vest and become fully exercisable in the event a change in control occurs as described below. The plan contains various provisions governing the participant’s right to exercise an option upon the termination of the participant’s employment with the Company.

Restricted Stock. Restricted stock awards may be issued to participants for no cash consideration, or for such minimum consideration as may be required by applicable law, either alone or in addition to other awards granted under the plan. Restricted stock vests and becomes fully exercisable as determined by the Board. Restricted stock vests and becomes fully exercisable in the event: (i) a change in control occurs, as described below, and service is terminated within 12 months thereafter; or (ii) of the death or disability of the participant. If a participant’s service with the Company is terminated, the participant will forfeit any unvested restricted stock (except in certain cases following a change in control).

Performance Share Awards. Other awards of Company common stock that are valued in whole or in part by reference to, or are otherwise based on, Company common stock or the attainment by the Company of certain performance goals, may be granted to participants, either alone or in addition to other awards. Stock awards are paid in shares of Company common stock. Shares granted as stock awards may be issued for no cash consideration or for such minimum consideration as may be required by applicable law. At the time the performance goals established have been attained or otherwise satisfied within the performance cycle, the payment of the performance shares in the name of the participant will be made at the end of the performance cycle.

Bonus Shares and Awards in Lieu of Obligations. Bonus share awards may be issued to participants as a bonus or in consideration for past services actually rendered for the Company, or in lieu of obligations of the Company to pay cash or deliver other property under the plan or under other plans or compensation arrangements. The bonus shares can be awarded under terms and agreements that are determined by the Compensation Committee and/or the Board.

Change in Control. Unless otherwise determined by the Board and/or Compensation Committee at the time of the grant of an award, in the event of a change in control of the Company, all outstanding stock options will become fully vested. If a participant’s service with the Company is involuntarily terminated at any time within twelve months after a change in control, and unless otherwise determined by the Board and/or Compensation Committee at the time of the grant of an award, any restricted period with respect to restricted shares will lapse and all such shares will become fully vested.

A “change in control” means, with certain exceptions: (i) an acquisition of beneficial ownership of 50% or more of the outstanding common stock; (ii) a merger in which the Company is not the surviving entity, or a sale by the Company or the Bank of all or substantially all of its assets; or (iii) the acquisition by any person or group by means of a merger, consolidation or purchase of 80% or more of its outstanding shares.

Effective Date, Term, Amendment and Termination. The plan will remain in effect until the earlier of (a) the date that no additional shares are available for issuance, (b) the date the plan is terminated by the Board of Directors in accordance with its terms or (c) the tenth anniversary of the date of the original shareholder approval of the plan. Termination will not affect grants and awards then outstanding under the plan. The Board of Directors may terminate or amend the plan at any time without shareholder approval, unless such approval is necessary to comply with the Securities Exchange Act of 1934, the Internal Revenue Code, NASDAQ rules, or other applicable law. No termination, amendment or modification of the plan may in any manner affect any award previously granted under the plan without the consent of the participant to whom the award was granted or the transferee of the award.

Restriction on Transfer. Awards granted under the plan are generally non-transferable, except by will or the laws of descent and distribution. The Board may permit participants to transfer awards (other than stock options) to members of their immediate family, to one or more trusts solely for the benefit of such immediate family members, and to partnerships into which such family members or trusts are the only partners.

Other Provisions. The Board may establish procedures providing for the delivery of shares of Company common stock, in satisfaction of withholding tax obligations.

Federal Income Tax Consequences. Under present law, the following are the U.S. federal income tax consequences generally arising with respect to stock options, restricted stock, bonus shares and performance share awards:

Upon exercising a non-statutory option, a participant must recognize ordinary compensation income equal to the difference between the fair market value of the shares on the date of exercise and the exercise price. The Company will be entitled to a deduction for the same amount. Upon sale of such shares by the optionee, any difference between the sales price and fair market value on the date of exercise will be treated as a long-term capital gain (loss) if the stock has been held for at least 12 months.

For an incentive stock option, the optionee generally will recognize no taxable income upon grant or exercise of the option. If the acquired stock is held for at least two years from date of grant and one year from date of exercise, any gain or loss realized upon disposition of the shares will be treated as long-term capital gain (loss). If the acquired stock is sold prior to the satisfaction of these holding period requirements, the difference between the option price and the fair market value of the shares on the date of exercise will be treated as ordinary compensation income. The Company will be entitled to a deduction for the same amount. If compensation is recognized and the stock is sold, any difference between fair market value on date of exercise and the sales price will be recognized as either short or long term capital gain or loss, depending upon the amount of time the acquired stock was held. For alternative minimum tax purposes, the exercise of an incentive stock option will create an adjustment item in the year of exercise equal to the difference between the option price and fair market value on date of exercise. This adjustment item will create an adjusted tax basis for alternative minimum tax purposes different from regular tax purposes in the stock equal to the fair market value on date of exercise.

Recipients of restricted stock awards will recognize ordinary income in an amount equal to the fair market value of the shares of Company common stock granted to them at the time that the shares vest and become transferable. A recipient of a restricted stock award may, however, elect to accelerate the recognition of income with respect to his or her grant to the time when shares of common stock are first transferred to him or her, notwithstanding the vesting schedule of such awards. The Company will be entitled to deduct as a compensation expense for tax purposes the same amounts recognized as income by recipients of restricted stock awards in the year in which such amounts are included in income.

Performance share and bonus share awards result in the recognition of ordinary income in an amount equal to the fair market value of shares of Company common stock paid to participants. The Company will be entitled to deduct as a compensation expense for tax purposes the same amounts recognized as income by plan participants.

Other Information

The Board has not made any determination as to the allocation of benefits or amounts under the plan if approved by shareholders. If the plan is not approved by shareholders, the Board of Directors will consider other alternatives for performance-based compensation. The plan is not exclusive and does not limit the authority of the Board or its Committees to grant awards or authorize any other compensation, with or without reference to shares, under any other plan or authority.

Vote Required and Recommendation of Board of Directors

Assuming the presence of a quorum, the affirmative vote of the majority of the votes cast for this proposal will be required for approval. As such, abstentions and broker non-votes will not affect the outcome of the vote, but will be counted for determining the existence of a quorum.

THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR APPROVAL OF THE INCREASE IN THE NUMBER OF SHARES THAT MAY BE ISSUED UNDER COMPANY’S 2018 EQUITY INCENTIVE PLAN.

PROPOSAL NO. 5

ADVISORY VOTE ON EXECUTIVE COMPENSATION

Under the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”), the shareholders of the Company are entitled to vote at the annual meeting on the compensation of the Company’s named executive officers, as disclosed in the Executive Compensation section and accompanying compensation tables contained in this Proxy Statement. Pursuant to the Dodd-Frank Act, the shareholder vote on executive compensation is an advisory vote only, and it is not binding on Company or the Board of Directors.

Although the vote is non-binding, the Board of Directors values the opinions of the shareholders and will consider the outcome of the vote when making future compensation decisions.

The Company’s current executive compensation program is designed to provide a competitive level of annual cash and equity compensation that will allow the Company to attract, motivate and retain individuals with the skills required to achieve the Company’s performance goals. At the present time, the Company is not utilizing any other long term compensation for the Company’s executive officers.

The advisory vote regarding the compensation of the named executive officers shall be approved if the votes cast in favor of the proposal exceed the votes cast against the proposal. Abstentions will not be counted as either votes cast for or against the proposal.

THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE “FOR” PROPOSAL NO. 3 TO APPROVE THE 4 FOR 1 REVERSE STOCK SPLIT.APPROVAL OF THE COMPENSATION OF THE NAMED EXECUTIVE OFFICERS AS DISCLOSED IN THE EXECUTIVE COMPENSATION SECTION AND ACCOMPANYING COMPENSATION TABLES CONTAINED IN THIS PROXY STATEMENT.

PROPOSAL NO. 46

ADVISORY VOTE ON FREQUENCY OF SHAREHOLDER VOTE ON EXECUTIVE COMPENSATION

Under the Dodd-Frank Act, the shareholders of the Company are entitled to vote at the annual meeting regarding whether the advisory vote on executive compensation should occur every one, two or three years. Under regulations issued by the SEC, shareholders shall also have the option to abstain from voting on the matter. Pursuant to the Dodd-Frank Act, the shareholder vote on the frequency of the advisory vote on executive compensation is an advisory vote only, and it is not binding on Company or the Board of Directors.

Although the vote is non-binding, the Board values the opinions of the shareholders and will consider the outcome of the vote when determining the frequency of the shareholder vote on executive compensation.

The Board of Directors has determined that an advisory shareholder vote on executive compensation every three years is the best approach for Company and its shareholders for following reasons:

● A three-year cycle will provide investors with sufficient time to evaluate the effectiveness of the Company’s incentive programs, compensation strategies and the total Company performance; and

● A three-year cycle provides the Board of Directors with sufficient time to thoughtfully evaluate and respond to shareholder input and effectively implement any desired changes to Company’ executive compensation program.

The advisory vote regarding the frequency of the shareholder vote described in this Proposal No. 5 shall be determined by a plurality of the votes cast. Abstentions will not be counted as either votes cast for or against the proposal.

THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE “FOR THREE YEARS” ON PROPOSAL NO. 6 REGARDING THE FREQUENCY OF THE SHAREHOLDER VOTE TO ON EXECUTIVE COMPENSATION.

PROPOSAL NO. 7

RATIFICATION OF INDEPENDENT AUDITOR

The Audit Committee has selected Hacker, Johnson & Smith, PAP.A. (“Hacker Johnson”Johnson”) as the Company’s independent auditor for fiscal year 2013,2023, and the Board asks shareholders to ratify that selection. Although current law, rules, and regulations, as well as the charter of the Audit Committee, require the Audit Committee to engage, retain, and oversee the Company’s independent auditor, the Board considers the selection of the independent auditor to be an important matter of shareholder concern and is submitting the selection of Hacker Johnson for ratification by shareholders as a matter of good corporate practice.governance.

The

Assuming the existence of a quorum, the affirmative vote of holders of athe majority of the shares of common stockvotes cast in person or by proxy atfor this proposal will be required for approval. As such, abstentions and broker non-votes will not affect the meeting is required to approve the ratificationoutcome of the selectionvote, but will be counted for determining the existence of Hacker Johnson as the Company’s independent auditor for the current fiscal year.a quorum.

The Board of Directors recommends a voteTHE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE “FOR” THE RATIFICATION OF HACKER, JOHNSON & SMITH, P.A. AS THE COMPANY’S INDEPENDENT AUDITOR FOR the proposal.FISCAL YEAR 2023.

AUDIT COMMITTEE REPORT

The Audit Committee has reviewed and discussed the audited financial statements of the Company for the fiscal year ended December 31, 20122022 with the Company’s management and has discussed with the independent auditors, Hacker, Johnson & Smith, PA,P.A., communications pursuant to applicable auditing standards. In addition, Hacker, Johnson & Smith, PAP.A. has provided the Audit Committee with the written disclosures and the letter required by applicable requirements of the PCAOB regarding the independent auditor’s communications with the audit committeeAudit Committee concerning independence, and the Audit Committee has discussed with Hacker, Johnson & Smith, PA,P.A., the independent auditor’s independence.

Based on these reviews and discussions, the Audit Committee recommended to the Board of Directors that the audited financial statements be included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 20122022 and selected Hacker, Johnson & Smith, PAP.A. as the Company’s independent auditor for 2013.

AUDIT COMMITTEE

Joel Klein, Chair

Seth Gillman

Moishe Gubin