[RP Financial, LC. Letterhead]
August 17, 1999
Board of Directors
Mutual Federal Savings Bank
000 Xxxx Xxxxxxx Xxxxxx
Xxxxxx, Xxxxxxx 00000-0000
Dear Members of the Board:
This letter sets forth the agreement between Mutual Federal Savings Bank,
Muncie, Indiana ("Mutual" or the "Bank"), and RP Financial, LC. ("RP
Financial"), whereby the Bank has engaged RP Financial to prepare the regulatory
business plan and financial projections for the private charitable foundation to
be formed in conjunction with the stock conversion transaction, and funded by a
stock contribution to the charitable foundation. These services are described in
greater detail below.
Description of Proposed Services
RP Financial's business planning services will include the following areas:
(1) describing potential charitable organizations to receive grants or donations
based on parties identified by the Bank; (2) describing the potential cash flows
of the foundation over a five year period; (3) preparing detailed financial
projections on an annual basis for a period of five fiscal years to reflect the
impact of the anticipated cash flows; (4) describing the corporate governance of
the foundation, including the management of the charitable foundation on a
day-to-day basis; (5) preparing the written business plan document which
conforms with applicable regulatory guidelines; and (6) describing the general
policies and procedures of the charitable foundation.
RP Financial agrees to prepare the business plan and accompanying financial
projections in writing such that the business plan can be filed with the
appropriate regulatory agencies in accordance with the scheduled filing date.
Fee Structure and Payment Schedule
The Bank agrees to compensate RP Financial for preparation of the business
plan for the charitable foundation on a fixed fee basis of $2,500. Payment of
the professional fees shall be made upon delivery of the completed business
plan.
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The Bank also agrees to reimburse RP Financial for those direct
out-of-pocket expenses necessary and incidental to providing the business
planning services. Reimbursable expenses will likely include shipping,
telephone/facsimile printing, computer and data services, and shall be paid to
RP Financial as incurred and billed. RP Financial will agree to limit
reimbursable expenses in conjunction with the appraisal engagement, subject to
written authorization from the Bank to exceed such level.
In the event the Bank shall, for any reason, discontinue this planning
engagement prior to delivery of the completed business plan and payment of the
progress payment fee, the Bank agrees to compensate RP Financial according to RP
Financial's standard billing rates for consulting services based on accumulated
and verifiable time expenses, not to exceed the fixed fee described above, plus
reimbursable expenses incurred.
If during the course of the planning engagement, unforeseen events occur so
as to materially change the nature or the work content of the business planning
services described in this contract, the terms of said contract shall be subject
to renegotiation by the Bank and RP Financial. Such unforeseen events may
include changes in regulatory requirements as it specifically relates to Mutual
or changes in the amount of the contribution or structure of the foundation,
which will dramatically impact the charitable foundation's cash flows, corporate
governance or operations.
* * * * * * * * * * *
Please acknowledge your agreement to the foregoing by signing as indicated
below and returning to RP Financial a signed copy of this letter.
Sincerely,
/s/ Xxxxxx X. Xxxxxxx
Xxxxxx X. Xxxxxxx
President and Managing Director
Agreed To and Accepted By: X. Xxxx Xxxxxxx /s/ X. Xxxx Xxxxxxx
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President and Chief Executive Officer
Upon Authorization by the Board of Directors For: Mutual Federal Savings Bank
Muncie, Indiana
Date Executed: August 25, 1999
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