EXHIBIT 1.2
DRAFT
44,893,125 Shares
(subject to increase up to 51,627,094 shares
in the event of an increase in the pro forma market
value of the Company's Common Stock)
Investors Bancorp, Inc.
(a Delaware stock holding company)
Common Stock
(par value $.01 per share)
AGENCY AGREEMENT
_____________ ______, 0000
XXXXXXX X'XXXXX & PARTNERS, L.P.
000 Xxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Investors Bancorp, Inc., a Delaware stock holding company (the "Company"),
Investors Bancorp, MHC, a New Jersey mutual holding company (the "MHC"), and
Investors Savings Bank, a New Jersey savings bank (the "Bank"), hereby confirm
their agreement with Sandler X'Xxxxx & Partners, L.P. ("Sandler X'Xxxxx" or the
"Agent") with respect to the offer and sale by the Company of up to 44,893,125
shares of the Company's common stock, par value $.01 per share (the "Common
Stock") (subject to increase up to 51,627,094 shares in the event of an increase
in the pro forma market value of the Company's Common Stock). The shares of
Common Stock to be sold by the Company in the Offerings (as defined below) are
hereinafter called the "Securities." In addition, as described herein, the
Company expects to contribute up to 1,346,794 shares of Common Stock and $4.5
million in cash to Investors Savings Bank Charitable Foundation, a charitable
foundation (the "Foundation"), such shares hereinafter being referred to as the
"Foundation Shares."
The Securities are being offered for sale and the Foundation Shares are
being contributed in accordance with the Stock Issuance Plan (the "Plan")
adopted by the Boards of Directors of the Company, the MHC and the Bank, which
provides for a stock offering of up to 49.9% of the Common Stock of the Company.
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Pursuant to the Plan, the Company will offer to certain depositors of the
Bank and to the Bank's tax qualified employee benefit plans, including the
Bank's employee stock ownership plan (the "ESOP") (collectively, the "Employee
Plans"), rights to subscribe for the Securities in a subscription offering (the
"Subscription Offering"). To the extent Securities are not subscribed for in the
Subscription Offering, such Securities may be offered to certain members of the
general public in a community offering (the "Community Offering"), with
preference given first to natural persons residing in Essex, Hunterdon,
Middlesex, Monmouth, Xxxxxx, Ocean, Somerset and Union Counties, New Jersey, and
second to other persons to whom the Company delivers a Prospectus (as
hereinafter defined). The Community Offering, which together with the
Subscription Offering, as each may be extended or reopened from time to time,
are herein referred to as the "Subscription and Community Offering," may be
commenced concurrently with, during or after, the Subscription Offering. It is
currently anticipated by the Bank and the Company that any Securities not
subscribed for in the Subscription and Community Offering will be offered,
subject to Section 2 hereof, in a syndicated community offering (the "Syndicated
Community Offering"). The Subscription and Community Offering and the Syndicated
Community Offering are hereinafter referred to collectively as the "Offerings."
It is acknowledged that the number of Securities to be sold in the Offerings may
be increased or decreased as described in the Prospectus. If the number of
Securities is increased or decreased in accordance with the Plan, the term
"Securities" shall mean such greater or lesser number, where applicable.
In connection with the Offerings and pursuant to the terms of the Plan as
described in the Prospectus, the Bank intends to establish the Foundation.
Immediately following the consummation of the Offerings, subject to compliance
with certain conditions as may be imposed by regulatory authorities, the Company
will contribute $4.5 million in cash and newly issued shares of Common Stock in
an amount equal to 1.33% of the number of shares that will be outstanding
following the shares sold in the Offerings and issued to the MHC, or between
995,456 and 1,346,794 shares of Common Stock (subject to increase in certain
circumstances to 1,548,813 shares).
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-1 (No. 333-125703), including a
related prospectus, for the registration of the Securities under the Securities
Act of 1933, as amended (the "Securities Act"), has filed such amendments
thereto, if any, and such amended prospectuses as may have been required to the
date hereof by the Commission in order to declare such registration statement
effective, and will file such additional amendments thereto and such amended
prospectuses and prospectus supplements as may hereafter be required. Such
registration statement (as amended to date, if applicable, and as from time to
time amended or supplemented hereafter) and the prospectuses constituting a part
thereof (including in each case all documents incorporated or deemed to be
incorporated by reference therein and the information, if any, deemed to be a
part thereof pursuant to the rules and regulations of the Commission under the
Securities Act, as from time to time amended or supplemented pursuant to the
Securities Act or otherwise (the "Securities Act Regulations")), are hereinafter
referred to as the "Registration Statement" and the "Prospectus," respectively,
except that if any revised prospectus shall be used by the Company in connection
with the Subscription and Community Offering or the Syndicated Community
Offering which differs from the Prospectus on file at the Commission at the time
the Registration Statement becomes effective (whether or not such revised
prospectus is required to be filed by the Company pursuant to
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Rule 424(b) of the Securities Act Regulations), the term "Prospectus" shall
refer to such revised prospectus from and after the time it is first provided to
the Agent for such use.
Concurrently with the execution of this Agreement, the Company is
delivering to the Agent copies of the Prospectus of the Company to be used in
the Offerings. Such Prospectus contains information with respect to the Bank,
the Company, the MHC and the Common Stock.
SECTION 1. REPRESENTATIONS AND WARRANTIES.
(a) The Company, the Bank and the MHC jointly and severally represent and
warrant to the Agent as of the date hereof as follows:
(i) The Registration Statement has been declared effective by the
Commission, no stop order has been issued with respect thereto and no
proceedings therefor have been initiated or, to the knowledge of the
Company, the MHC and the Bank, threatened by the Commission. At the time
the Registration Statement became effective and at the Closing Time
referred to in Section 2 hereof, the Registration Statement complied and
will comply in all material respects with the requirements of the
Securities Act and the Securities Act Regulations and did not and will not
contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements
therein not misleading. The Prospectus, at the date hereof does not and at
the Closing Time referred to in Section 2 hereof will not, include an
untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided,
however, that the representations and warranties in this subsection shall
not apply to statements in or omissions from the Registration Statement or
Prospectus made in reliance upon and in conformity with information with
respect to the Agent furnished to the Company in writing by the Agent
expressly for use in the Registration Statement or Prospectus (the "Agent
Information," which the Company, the MHC and the Bank acknowledge appears
only in the sixth paragraph of the section "The Offering - Plan of
Distribution and Marketing Arrangements" of the Prospectus).
(ii) Pursuant to the rules and regulations of the Board of Governors
of the Federal Reserve Board (the "FRB"), as from time to time amended or
supplemented, the Company, the Bank and the MHC have filed with the FRB a
modification of a commitment letter dated ________________, and have filed
such amendments thereto and supplementary materials as may have been
required to the date hereof (such modification, as amended to date, if
applicable, and as from time to time amended or supplemented hereafter, is
hereinafter referred to as the "Modification"). The Offerings and the
Modification have been duly adopted by the Boards of Directors of the
Company, the Bank and the MHC and such adoption has not since been
rescinded or revoked. The Modification has been approved by the FRB. The
FRB has approved or not objected to the use of the Prospectus and such
approval or non-objection remains in full force and effect and no order
has been issued by the FRB suspending or revoking such approval or
non-objection and no proceedings therefor have been initiated or, to the
knowledge of the Company, the MHC or the Bank, threatened by the FRB. At
the date of such approval and at the Closing Time referred to in Section
2, the Plan complied and will comply in all material respects with the
applicable provisions of
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the rules and regulations of the FDIC or OTS governing stock offerings of
the type contemplated by the Plan (the "Conversion Regulations"). No
approval of any other regulatory or supervisory or other public authority
is required in connection with the implementation of the Plan that has not
been obtained and a copy of which has been delivered to the Agent.
(iii) The Company, the MHC and the Bank have filed the Prospectus
and any supplemental sales literature with the Commission and the FRB. The
Prospectus and all supplemental sales literature, as of the date the
Registration Statement became effective and at the Closing Time referred
to in Section 2, complied and will comply in all material respects with
the applicable requirements of the Securities Act Regulations and, at or
prior to the time of their first use, will have received all required
authorizations of the FRB, if any, and Commission for use in final form.
No approval of any other regulatory or supervisory or other public
authority is required in connection with the distribution of the
Prospectus and any supplemental sales literature that has not been
obtained and a copy of which has been delivered to the Agent.
(iv) None of the Commission, the FRB, the New Jersey Department of
Banking and Insurance (the "NJBDI") or the Federal Deposit Insurance
Corporation (the "FDIC") or any "Blue Sky" authority has, by order or
otherwise, prevented or suspended the use of the Prospectus or any
supplemental sales literature authorized by the Company, the MHC or the
Bank for use in connection with the Offerings, and no proceedings for such
purposes are pending or, to the knowledge of the Company, the MHC and the
Bank, threatened.
(v) The Offerings and other transactions contemplated hereby do not
and will not require any material consent, approval, authorization or
permit or filing with any other governmental agency or regulatory
authority, except as disclosed in the Prospectus.
(vi) FinPro, Inc., (the "Appraiser"), which prepared the valuation
of the Bank as part of the Plan, has advised the Company, the MHC and the
Bank in writing that it satisfies all requirements for an appraiser set
forth in the Conversion Regulations and any interpretations or guidelines
issued by the FDIC, the OTS or their staff with respect thereto.
(vii) KPMG, LLP, the accountants who audited and reported on the
consolidated financial statements and supporting schedules of the Company
and its subsidiaries included in the Registration Statement, have advised
the Company, the MHC and the Bank in writing that they are independent
public accountants within the meaning of the Code of Ethics of the
American Institute of Certified Public Accountants (the "AICPA"), that
they are registered with the Public Company Accounting Oversight Board
("PCAOB") and such accountants are, with respect to the Company, the MHC
and the Bank, independent registered public accountants as required by,
and are not in violation of the auditors independence requirements of, the
Securities Act, the Securities Act Regulations and the Conversion
Regulations.
(viii) The only direct subsidiary of the Company is the Bank; the
only direct and indirect subsidiaries of the Bank are My Way Development
LLC, ISB Holdings, Inc., ISB Asset Corporation (REIT), ISB Mortgage
Company LLC and Investors Financial Services,
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Inc. (collectively, the "Subsidiaries"). Except for the Subsidiaries, none
of the Company, the MHC or the Bank, directly or indirectly, controls any
other corporation, limited liability company, partnership, joint venture,
association, trust or other business organization.
(ix) The consolidated financial statements and the related schedules
and notes thereto included in the Registration Statement and the
Prospectus present fairly the financial position of the Company and its
subsidiaries at the dates indicated and the results of operations,
retained earnings, equity and cash flows for the periods specified, and
comply as to form with the applicable accounting requirements of the
Securities Act Regulations and the Conversion Regulations; except as
otherwise stated in the Registration Statement and Prospectus, said
financial statements have been prepared in conformity with generally
accepted accounting principles applied on a consistent basis; and the
supporting schedules and tables included in the Registration Statement and
Prospectus present fairly the information required to be stated therein.
The other financial, statistical and pro forma information and related
notes included in the Prospectus present fairly the information shown
therein on a basis consistent with the audited and unaudited financial
statements included in the Prospectus, and as to the pro forma
adjustments, the adjustments made therein have been consistently applied
on the basis described therein.
(x) Since the respective dates as of which information is given in
the Registration Statement and the Prospectus, except as otherwise stated
therein (A) there has been no material adverse change in the financial
condition, results of operations, business affairs or prospects of the
Company, the MHC, the Bank and the Subsidiaries, considered as one
enterprise, whether or not arising in the ordinary course of business and
(B) except for transactions specifically referred to or contemplated in
the Registration Statement and Prospectus, there have been no transactions
entered into by the Company, the MHC or the Bank, other than those in the
ordinary course of business consistent with past practice, which are
material with respect to the Company, the MHC, the Bank and the
Subsidiaries, considered as one enterprise. The capitalization,
liabilities, assets, properties and business of the Company, the MHC and
the Bank conform in all material respects to the descriptions contained in
the Prospectus and none of the Company, the MHC or the Bank has any
material liabilities of any kind, contingent or otherwise, except as
disclosed in the Registration Statement or the Prospectus.
(xi) The Company has been duly organized and is validly existing as
a stock holding company chartered under the laws of the State of Delaware
with full corporate power and authority to own, lease and operate its
properties, to conduct its business as described in the Registration
Statement and the Prospectus, and to enter into and perform its
obligations under this Agreement and the transactions contemplated hereby;
and the Company is duly qualified to transact business and is in good
standing under the laws of the State of Delaware, in the State of New
Jersey and in each other jurisdiction in which such qualification is
required, whether by reason of the ownership or leasing of property or the
conduct of business, except where the failure to so qualify would not have
a material adverse effect on the financial condition, results of
operations, business affairs or prospects of the Company, the MHC, the
Bank and the Subsidiaries, considered as one enterprise (a "Material
Adverse Effect").
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(xii) Upon completion of the Offerings and the contribution of the
Foundation Shares as described in the Prospectus, the issued and
outstanding capital stock of the Company will be within the range as set
forth in the Prospectus under "Capitalization" (except for subsequent
issuances, if any, pursuant to reservations, agreements or employee
benefit plans referred to in the Prospectus). The authorized capital stock
of the Company consists of 200,000,000 shares of Common Stock and
50,000,000 shares of preferred stock, par value $.01 per share, and the
issued and outstanding capital stock of the Company at the date hereof is
50 shares of Common Stock, all of which are beneficially owned and of
record by the MHC free and clear of any security interest, mortgage,
pledge, lien, encumbrance or legal or equitable claim; at the date hereof
and at the Closing Time, the Securities will have been duly authorized for
issuance and, when issued and delivered by the Company pursuant to the
Plan against payment of the consideration calculated as set forth in the
Plan and stated on the cover page of the Prospectus, will be duly and
validly issued and fully paid and nonassessable; the terms and provisions
of the Common Stock and the other capital stock of the Company conform to
all statements relating thereto contained in the Prospectus; the
certificates representing the shares of Common Stock will conform to the
requirements of applicable law and regulations; and the issuance of the
Securities and the Foundation Shares is not subject to preemptive or other
similar rights, except for subscription rights granted pursuant to the
Plan.
(xiii) The MHC has been duly organized and is validly existing as a
mutual holding company chartered under the laws of the State of New Jersey
with full corporate power and authority to own, lease and operate its
properties, to conduct its business as described in the Registration
Statement and the Prospectus, and to enter into and perform its
obligations under this Agreement and the transactions contemplated hereby;
and the MHC is duly qualified to transact business and is in good standing
under the laws of the State of New Jersey and in each other jurisdiction
in which such qualification is required, whether by reason of the
ownership or leasing of property or the conduct of business, except where
the failure to so qualify would not have a Material Adverse Effect.
(xiv) The MHC has no capital stock. All holders of the savings,
demand or other authorized accounts of the Bank are members of the MHC. As
of the Closing Time referred to in Section 2, the MHC will not own any
equity securities or any equity interest in any business enterprise except
as described in the Prospectus.
(xv) The Bank has been duly organized and is validly existing as a
savings bank chartered under the laws of the State of New Jersey with full
corporate power and authority to own, lease and operate its properties, to
conduct its business as described in the Registration Statement and the
Prospectus, and to enter into and perform its obligations under this
Agreement and the transactions contemplated hereby; and the Bank is duly
qualified to transact business and is in good standing under the laws of
the State of New Jersey and in each other jurisdiction in which such
qualification is required, whether by reason of the ownership or leasing
of property or the conduct of business, except where the failure to so
qualify would not have a Material Adverse Effect.
(xvi) The authorized capital stock of the Bank consists of 5,000,000
shares of common stock, par value $2.00 per share ("Bank Common Stock"),
and the issued and
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outstanding capital stock of the Bank is 250,000 shares of Bank Common
Stock, all of which are owned beneficially and of record by the Company
free and clear of any security interest, mortgage, pledge, lien,
encumbrance or legal or equitable claim. All of the issued and outstanding
capital stock of the Bank has been duly authorized, validly issued and
fully paid and nonassessable and has been issued in compliance with all
federal and state securities laws. There are no outstanding warrants,
options or rights of any kind to acquire additional shares of capital
stock of the Bank.
(xvii) The Company, the MHC, the Bank and the Subsidiaries have each
obtained all licenses, permits and other governmental authorizations
currently required for the conduct of their respective businesses, except
where the failure to obtain such licenses, permits or other governmental
authorizations would not have a Material Adverse Effect; all such
licenses, permits and other governmental authorizations are in full force
and effect and the Company, the MHC, the Bank and the Subsidiaries are in
all material respects in compliance therewith; none of the Company, the
MHC, the Bank or any Subsidiary has received notice of any proceeding or
action relating to the revocation or modification of any such license,
permit or other governmental authorization which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or finding,
might have a Material Adverse Effect.
(xviii) Each Subsidiary has been duly organized and is validly
existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, has full corporate power and authority
to own, lease and operate its properties and to conduct its business as
described in the Registration Statement and Prospectus, and is duly
qualified as a foreign corporation to transact business and is in good
standing in each jurisdiction in which such qualification is required,
whether by reason of the ownership or leasing of property or the conduct
of business, except where the failure to so qualify would not have a
Material Adverse Effect; the activities of each Subsidiary are permitted
to subsidiaries of a New Jersey-chartered savings bank, in the case of the
Bank, and a Delaware-chartered stock holding company, in the case of the
Company, by the rules, regulations, resolutions and practices of the FDIC
and the NJDBI, in the case of the Bank, and the FRB, in the case of the
Company; all of the issued and outstanding capital stock of each
Subsidiary has been duly authorized and validly issued, is fully paid and
nonassessable and is owned by the MHC or the Bank, as the case may be,
directly, free and clear of any security interest, mortgage, pledge, lien,
encumbrance or legal or equitable claim; and there are no warrants,
options or rights of any kind to acquire shares of capital stock of any
Subsidiary.
(xix) The Bank is a member in good standing of the Federal Home Loan
Bank of New York; the deposit accounts of the Bank are insured by the FDIC
up to the applicable limits.
(xx) The Company, the MHC and the Bank have taken all corporate
action necessary for them to execute, deliver and perform this Agreement
and the transactions contemplated hereby, and this Agreement has been duly
executed and delivered by, and is the valid and binding agreement of, the
Company, the MHC and the Bank, enforceable against each of them in
accordance with its terms, except as may be limited by bankruptcy,
insolvency or other laws affecting the enforceability of the rights of
creditors generally and the availability of equitable remedies.
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(xxi) No approval of any regulatory or supervisory or other public
authority is required in connection with the execution and delivery of
this Agreement or the issuance of the Securities that has not been
obtained and a copy of which has been delivered to the Agent, except as
may be required under the "Blue Sky" or securities laws of various
jurisdictions.
(xxii) None of the Company, the MHC, the Bank or any of the
Subsidiaries is in violation of their respective certificate of
incorporation, organization certificate, articles of incorporation or
charter, as the case may be, or bylaws or other written corporate
governance requirements or guidelines; and none of the Company, the MHC,
the Bank or any of the Subsidiaries is in default (nor has any event
occurred which, with notice or lapse of time or both, would constitute a
default) in the performance or observance of any obligation, agreement,
covenant or condition contained in any contract, indenture, mortgage, loan
agreement, note, lease or other instrument to which the Company, the MHC,
the Bank or any of the Subsidiaries is a party or by which it or any of
them may be bound, or to which any of the property or assets of the
Company, the MHC, the Bank or any of the Subsidiaries is subject, except
for such defaults that would not, individually or in the aggregate, have a
Material Adverse Effect; and there are no contracts or documents of the
Company, the MHC or the Bank which are required to be filed as exhibits to
the Registration Statement or the Plan which have not been so filed.
(xxiii) The execution, delivery and performance of this Agreement
and the consummation of the transactions contemplated herein, have been
duly authorized by all necessary corporate action on the part of the
Company, the MHC and the Bank, and do not and will not conflict with or
constitute a breach of, or default under, or result in the creation or
imposition of any lien, charge or encumbrance upon any property or assets
of the Company, the MHC or the Bank pursuant to, any contract, indenture,
mortgage, loan agreement, note, lease or other instrument to which the
Company, the MHC or the Bank is a party or by which it or any of them may
be bound, or to which any of the property or assets of the Company, the
MHC or the Bank is subject, except for such conflicts, breaches or
defaults that would not, individually or in the aggregate, have a Material
Adverse Effect; nor will such action result in any violation of the
provisions of the respective charter or bylaws of the Company, the MHC or
the Bank, or any applicable law, administrative regulation or
administrative or court decree.
(xxiv) No labor dispute with the employees of the Company, the MHC,
the Bank or the Subsidiaries exists or, to the knowledge of the Company,
the MHC, the Bank or the Subsidiaries, is imminent or threatened; and the
Company, the MHC and the Bank are not aware of any existing or threatened
labor disturbance by the employees of any of its principal suppliers or
contractors which might be expected to have a Material Adverse Effect.
(xxv) Each of the Company, the MHC, the Bank and the Subsidiaries
has good and marketable title to all properties and assets for which
ownership is material to the business of the Company, the MHC, the Bank or
the Subsidiaries and to those properties and assets described in the
Prospectus as owned by them, free and clear of all liens, charges,
encumbrances or restrictions, except such as are described in the
Prospectus or are not material in relation to the business of the Company,
the MHC, the Bank or the Subsidiaries,
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considered as one enterprise; and all of the leases and subleases material
to the business of the Company, the MHC, the Bank or the Subsidiaries
under which the Company, the MHC, the Bank or the Subsidiaries hold
properties, including those described in the Prospectus, are valid and
binding agreements of the Company, the MHC, the Bank or the Subsidiaries,
in full force and effect, enforceable in accordance with their terms
except as may be limited by bankruptcy, insolvency or other laws affecting
the enforceability of the rights of creditors generally and the
availability of equitable remedies.
(xxvi) None of the Company, the MHC or the Bank is in violation of
any order or directive from the FRB, the NJDBI, the FDIC, the Commission
or any regulatory authority to make any material change in the method of
conducting its respective businesses; the Company, the MHC, the Bank and
each of the Subsidiaries have conducted and are conducting their business
so as to comply in all material respects with all applicable statutes,
regulations and administrative and court decrees (including, without
limitation, all regulations, decisions, directives and orders of the FRB,
the NJDBI, the FDIC and the Commission). Neither the Company, the MHC, the
Bank nor any of the Subsidiaries is subject or is party to, or has
received any notice or advice that any of them may become subject or party
to, any investigation with respect to any cease-and-desist order,
agreement, consent agreement, memorandum of understanding or other
regulatory enforcement action, proceeding or order with or by, or is a
party to any commitment letter or similar undertaking to, or is subject to
any directive by, or has been a recipient of any supervisory letter from,
or has adopted any board resolutions at the request of, any Regulatory
Agency (as defined below) that currently restricts the conduct of their
business or that in any manner relates to their capital adequacy, their
credit policies, their management or their business (each, a "Regulatory
Agreement"), nor has the Company, the MHC, the Bank or any of the
Subsidiaries been advised by any Regulatory Agency that it is considering
issuing or requesting the issuance of any such Regulatory Agreement; and
there is no unresolved violation, criticism or exception by any Regulatory
Agency with respect to any report or statement relating to any
examinations of the Company, the MHC, the Bank or any of the Subsidiaries
which in the reasonable judgment of the Company, the MHC or the Bank is
expected to have a Material Adverse Effect, or which might materially and
adversely affect the properties or assets thereof or which might adversely
affect the consummation of the Offerings or the performance of this
Agreement. As used herein, the term "Regulatory Agency" means any federal
or state agency charged with the supervision or regulation of depositary
institutions or holding companies of depositary institutions, or engaged
in the insurance of depositary institution deposits, or any court,
administrative agency or commission or other governmental agency,
authority or instrumentality having supervisory or regulatory authority
with respect to the Company, the MHC, the Bank or any of the Subsidiaries.
(xxvii) There is no action, suit or proceeding before or by any
court or governmental agency or body, domestic or foreign, now pending,
or, to the knowledge of the Company, the MHC or the Bank, threatened,
against or affecting the Company, the MHC or the Bank which is required to
be disclosed in the Registration Statement (other than as disclosed
therein), or which might have a Material Adverse Effect, or which might
materially and adversely affect the properties or assets thereof, or which
might adversely affect the
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consummation of the Offerings, or the performance of this Agreement; all
pending legal or governmental proceedings to which the Company, the MHC,
the Bank or any Subsidiary is a party or of which any of their respective
property or assets is the subject which are not described in the
Registration Statement, including ordinary routine litigation incidental
to the business, are considered in the aggregate not material.
(xxviii) The Company, the MHC and the Bank have obtained an opinion
of its counsel, Xxxx Xxxxxx Xxxxxxxx & Xxxxxx, P.C., with respect to the
legality of the Securities and the Foundation Shares to be issued and
certain federal income tax consequences of the Offerings and the Plan, a
copy of which is filed as an exhibit to the Registration Statement; all
material aspects of the aforesaid opinion is accurately summarized in the
Prospectus under "The Offering - Tax Effects of the Offering," the facts
and representations upon which such opinion is based are truthful,
accurate and complete in all material respects; and neither the Company,
the MHC, nor the Bank has taken or will take any action inconsistent
therewith.
(xxix) The Company is not and, upon completion of the Offerings and
sale of the Securities and the application of the net proceeds therefrom,
will not be, required to be registered as an "investment company" as that
term is defined under the Investment Company Act of 1940, as amended.
(xxx) All of the loans represented as assets on the most recent
consolidated financial statements or consolidated selected financial
information of the Company included in the Prospectus meet or are exempt
from all requirements of federal, state or local law pertaining to
lending, including without limitation truth in lending (including the
requirements of Regulations Z and 12 C.F.R. Part 226 and Section 563.99),
real estate settlement procedures, consumer credit protection, equal
credit opportunity and all disclosure laws applicable to such loans,
except for violations which, if asserted, would not result in a Material
Adverse Effect.
(xxxi) To the knowledge of the Company, the MHC, the Bank and each
Subsidiary, with the exception of the intended loan to the Bank's ESOP by
the Company to enable the ESOP to purchase securities in an amount up to
10.0% of the Securities offered in the Offerings and the Foundation
Shares, none of the Company, the MHC, the Bank or their employees has made
any payment of funds of the Company, the MHC or the Bank as a loan for the
purchase of the Common Stock or made any other payment of funds prohibited
by law, and no funds have been set aside to be used for any payment
prohibited by law.
(xxxii) Each of the Company, the MHC, the Bank and each of the
Subsidiaries maintains a system of internal accounting controls sufficient
to provide reasonable assurance that (a) transactions are executed in
accordance with management's general or specific authorizations; (b)
transactions are recorded as necessary to permit preparation of financial
statements in conformity with generally accepted accounting principles and
to maintain asset accountability; (c) access to assets is permitted only
in accordance with management's general or specific authorization; and (d)
the recorded accountability for assets is compared with the existing
assets at reasonable intervals and appropriate action is taken with
respect to any differences.
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(xxxiii) The Company, the MHC, the Bank and each Subsidiary are in
compliance in all material respects with the applicable financial
recordkeeping and reporting requirements of the Currency and Foreign
Transaction Reporting Act of 1970, as amended, and the rules and
regulations thereunder. The Bank has established compliance programs to
ensure compliance with the requirements of the USA Patriot Act and all
applicable regulations promulgated thereunder. The Bank is in compliance
in all material respects with the USA Patriot Act and all applicable
regulations promulgated thereunder, and there is no charge, investigation,
action, suit or proceeding before any court, regulatory authority or
governmental agency or body pending or, to the best knowledge of the
Company, the MHC and the Bank, threatened regarding the Bank's compliance
with the USA Patriot Act or any regulations promulgated thereunder.
(xxxiv) None of the Company, the MHC, the Bank or any Subsidiary nor
any properties owned or operated by the Company, the MHC, the Bank or any
Subsidiary is in violation of or liable under any Environmental Law (as
defined below), except for such violations or liabilities that,
individually or in the aggregate, would not have a material adverse effect
on the financial condition, results of operation or business affairs of
the Company, the MHC, the Bank and any Subsidiary, considered as one
enterprise. There are no actions, suits or proceedings, or demands,
claims, notices or investigations (including, without limitation, notices,
demand letters or requests for information from any environmental agency)
instituted or pending, or to the knowledge of the Company, the MHC, the
Bank or any Subsidiary, threatened, relating to the liability of any
property owned or operated by the Company, the MHC, the Bank or any
Subsidiary, under any Environmental Law, except for such actions, suits or
proceedings, or demands, claims, notices or investigations that,
individually or in the aggregate, would not have a Material Adverse
Effect. For purposes of this subsection, the term "Environmental Law"
means any federal, state, local or foreign law, statute, ordinance, rule,
regulation, code, license, permit, authorization, approval, consent,
order, judgment, decree, injunction or agreement with any regulatory
authority relating to (i) the protection, preservation or restoration of
the environment (including, without limitation, air, water, vapor, surface
water, groundwater, drinking water supply, surface soil, subsurface soil,
plant and animal life or any other natural resource), and/or (ii) the use,
storage, recycling, treatment, generation, transportation, processing,
handling, labeling, production, release or disposal of any substance
presently listed, defined, designated or classified as hazardous, toxic,
radioactive or dangerous, or otherwise regulated, whether by type or by
quantity, including any material containing any such substance as a
component.
(xxxv) The Company, the MHC, the Bank and each Subsidiary have filed
all federal, state and local income and franchise tax returns required to
be filed and have made timely payments of all taxes shown as due and
payable in respect of such returns, and no deficiency has been asserted
with respect thereto by any taxing authority. No tax deficiency has been
asserted, and the Company, the MHC and the Bank have no knowledge of any
tax deficiency which could be asserted against the Company, the MHC, the
Bank or the Subsidiaries.
(xxxvi) The Company has received all approvals required to
consummate the
11
Offerings, and to have the Securities and the Foundation Shares quoted on
the Nasdaq National Market effective as of the Closing Time referred to in
Section 2 hereof.
(xxxvii) The Company has filed a registration statement for the
Securities under Section 12(g) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), and such registration statement was declared
effective concurrent with the effectiveness of the Registration Statement.
(xxxviii) To the knowledge of the Company, there are no affiliations
or associations (as such terms are defined by the National Association of
Securities Dealers, Inc. ("NASD")) between any member of the NASD and any
of the Company's, the MHC's or the Bank's officers or directors.
(xxxix) The Company, the MHC, the Bank and each Subsidiary carries,
or is covered by, insurance in such amounts and covering such risks as is
adequate for the conduct of their respective businesses and the value for
their respective properties as is customary for companies engaged in
similar industries.
(xl) The Company, the MHC and the Bank have not relied on Agent or
its counsel for any legal, tax or accounting advice in connection with the
Offerings.
(xli) The records of eligible account holders, supplemental eligible
account holders, and other depositors are accurate and complete in all
material respects.
(xlii) The Company, the MHC, the Bank and each Subsidiary is in
compliance in all material respects with all presently applicable
provisions of the Employee Retirement Income Security Act of 1974, as
amended, including the regulations and published interpretations
thereunder ("ERISA"); no "reportable event" (as defined in ERISA) has
occurred with respect to any "pension plan" (as defined in ERISA) for
which the Company, the MHC, the Bank or any Subsidiary, respectively,
would have any liability; each of the Company, the MHC, the Bank and each
Subsidiary has not incurred and does not expect to incur liability under
(i) Title IV of ERISA with respect to termination of , or withdrawal from,
any "pension plan" or (ii) Sections 412 or 4971 of the Internal Revenue
Code of 1986, as amended, including the regulations and published
interpretations thereunder (the "Code"); and each "pension plan" for which
the Company, the MHC, the Bank and any Subsidiary would have any liability
that is intended to be qualified under Section 401(a) of the Code is so
qualified in all material respects and nothing has occurred, whether by
action or by failure to act, which would cause the loss of such
qualification.
(xliii) The Company has established and maintains disclosure
controls and procedures (as such term is defined in Rule 13a-14 and 15d-14
under the Exchange Act), which (i) are designed to ensure that material
information relating to the Company, including its consolidated
subsidiaries, is made known to the Company's principal executive officer
and its principal financial officer by others within those entities; and
(ii) are effective in all material respects to perform the functions for
which they were established. There (i) are not any significant
deficiencies in the design or operation of internal controls which could
adversely affect the Company's ability to record, process, summarize, and
report financial
12
data or (ii) has not been any fraud, whether or not material, that
involves management or other employees who have a significant role in the
Company's internal controls. Since the date of the most recent evaluation
of the Company's disclosure controls and procedures, there have been no
significant changes in internal controls or in other factors that could
significantly affect internal controls, including any corrective actions
with regard to significant deficiencies and material weaknesses.
(xliv) The Company is in compliance with the applicable provisions
of the Sarbanes Oxley Act of 2002 (the "Sarbanes Oxley Act"), the rules
and regulations of the Commission thereunder, and the Nasdaq corporate
governance rules applicable to the Company, and will use its best efforts
to comply with those provisions of the Sarbanes Oxley Act and the Nasdaq
corporate governance rules that will become effective in the future upon
their effectiveness.
(xlv) The Foundation has been duly authorized and incorporated and
is validly existing as a non-stock corporation in good standing under the
laws of the State of Delaware with corporate power and authority to own,
lease and operate its properties and to conduct its business as described
in the Prospectus; the Foundation will not be a bank holding company
within the meaning of 12 C.F.R. Section 225.2(c) as a result of the
issuance of the Foundation shares to it in accordance with the terms of
the Plan and in the amounts as described in the Prospectus; no approvals
are required to establish the Foundation and to contribute the Foundation
Shares thereto as described in the Prospectus other than the conditions
imposed by the FRB; except as specifically disclosed in the Prospectus,
there are no agreements and/or understandings, written or oral, between
the Company, the MHC and the Bank on the one hand and the Foundation, on
the other, with respect to the control, directly or indirectly, over the
voting and the acquisition or disposition of the Foundation Shares; at the
Closing Time, the Foundation Shares will have been duly authorized for
issuance and, when issued and contributed by the Company pursuant to the
Plan, will be duly and validly issued and fully paid and nonassessable;
and the issuance of the Foundation shares is not subject to preemptive or
similar rights.
(b) Any certificate signed by any officer of the Company, the MHC,
the Bank or any Subsidiary and delivered to either of the Agent or counsel
for the Agent shall be deemed a representation and warranty by the
Company, the MHC or the Bank to the Agent as to the matters covered
thereby.
SECTION 2. APPOINTMENT OF SANDLER X'XXXXX; SALE AND DELIVERY OF THE
SECURITIES; CLOSING. On the basis of the representations and warranties
herein contained and subject to the terms and conditions herein set forth,
the Company hereby appoints Sandler X'Xxxxx as its Agent to consult with
and advise the Company, and to assist the Company with the solicitation of
subscriptions and purchase orders for Securities, in connection with the
Company's sale of Common Stock in the Offerings. On the basis of the
representations and warranties herein contained, and subject to the terms
and conditions herein set forth, Sandler X'Xxxxx accepts such appointment
and agrees to use its best efforts to assist the Company with the
solicitation of subscriptions and purchase orders for Securities in
accordance with this Agreement; provided, however, that the Agent shall
not be
13
obligated to take any action which is inconsistent with any applicable
laws, regulations, decisions or orders. The services to be rendered by
Sandler X'Xxxxx pursuant to this appointment include the following: (i)
consulting as to the securities marketing implications of any aspect of
the Plan or related corporate documents; (ii) reviewing with the Board of
Directors of the Company, the MHC and the Bank financial and securities
marketing implications of the Appraiser's appraisal of the Common Stock;
(iii) reviewing all offering documents, including the Prospectus, stock
order forms and related offering materials (it being understood that
preparation and filing of such documents is the sole responsibility of the
Company and the Bank and their counsel); (iv) assisting in the design and
implementation of a marketing strategy for the Offerings; (v) assisting
management of the Company and the Bank in preparing for meetings with
potential investors and broker-dealers; and (vi) providing such other
general advice and assistance regarding financial and marketing aspects of
the Offering as may be requested to promote the successful completion of
the Offering.
The appointment of the Agent hereunder shall terminate upon the
earlier to occur of (a) forty-five (45) days after the last day of the
Subscription and Community Offering, unless the Company and the Agent
agree in writing to extend such period, or (b) the receipt and acceptance
of subscriptions and purchase orders for all of the Securities, or (c) the
completion of the Syndicated Community Offering.
If any of the Securities remain available after the expiration of
the Subscription and Community Offering, at the request of the Company and
the Bank, Sandler X'Xxxxx will seek to form a syndicate of registered
brokers or dealers ("Selected Dealers") to assist in the solicitation of
purchase orders of such Securities on a best efforts basis. Sandler
X'Xxxxx will endeavor to limit the aggregate fees to be paid by the
Company, the MHC and the Bank to an amount competitive with gross
underwriting discounts charged at such time for underwritings of
comparable amounts of stock sold at a comparable price per share in a
similar market environment; provided, however, that the aggregate fees
payable to Sandler X'Xxxxx and Selected Dealers shall not exceed 6.0% of
the aggregate dollar amount of the Securities sold in the Syndicated
Community Offering by such Selected Dealers. Sandler X'Xxxxx will endeavor
to distribute the Securities among the Selected Dealers in a fashion which
best meets the distribution objective of the Company and the Bank, which
may result in limiting the allocation of stock to certain Selected
Dealers. It is understood that in no event shall Sandler X'Xxxxx be
obligated to act as a Selected Dealer or to take or purchase any
Securities.
In the event the Company is unable to sell at least the total
minimum of the Securities, as set forth on the cover page of the
Prospectus, within the period herein provided, this Agreement shall
terminate and the Company shall refund to any persons who have subscribed
for any of the Securities the full amount which it may have received from
them, together with interest as provided in the Prospectus, and no party
to this Agreement shall have any obligation to the others hereunder,
except for the obligations of the Company, the MHC and the Bank as set
forth in Sections 4, 6(a) and 7 hereof and the obligations of the Agent as
provided in Sections 6(b) and 7 hereof. Appropriate arrangements for
placing the funds received from subscriptions for Securities or other
offers to purchase Securities in
14
special interest-bearing accounts with the Bank until all Securities are
sold and paid for were made prior to the commencement of the Subscription
Offering, with provision for refund to the purchasers as set forth above,
or for delivery to the Company if all Securities are sold.
If at least the total minimum of Securities, as set forth on the
cover page of the Prospectus, are sold, the Company agrees to issue or
have issued the Securities sold and to release for delivery certificates
for such Securities at the Closing Time against payment therefor by
release of funds from the special interest-bearing accounts referred to
above. The closing shall be held at the offices of Xxxx Xxxxxx Xxxxxxxx &
Xxxxxx, P.C., at 10:00 a.m., Eastern time, or at such other place and time
as shall be agreed upon by the parties hereto, on a business day to be
agreed upon by the parties hereto. The Company shall notify the Agent by
telephone, confirmed in writing, when funds shall have been received for
all the Securities. Certificates for Securities shall be delivered
directly to the purchasers thereof in accordance with their directions.
Notwithstanding the foregoing, certificates for Securities purchased
through Selected Dealers shall be made available to the Agent for
inspection at least 48 hours prior to the Closing Time at such office as
the Agent shall designate. The hour and date upon which the Company shall
release for delivery all of the Securities, in accordance with the terms
hereof, is herein called the "Closing Time."
The Company will pay any stock issue and transfer taxes which may be
payable with respect to the sale of the Securities.
In addition to the reimbursement of the expenses specified in
Section 4 hereof, the Agent will receive the following compensation for
its services hereunder:
(a) One percent (1.00%) of the aggregate purchase price of the
Securities sold in the Subscription and Community Offering up to $200
million plus seventy-five basis points (0.75%) of the aggregate purchase
price of the Securities sold in the Subscription and Community Offering in
excess of $200 million but less than $400 million, plus fifty basis points
(0.50%) of the aggregate purchase price of the Securities sold in the
Subscription and Community Offering in excess of $400 million, excluding
in each case shares purchased by (i) any employee benefit plan of the
Company or the Bank established for the benefit of their respective
directors, officers and employees, (ii) any charitable foundation of the
Company, and/or (iii) any director, officer or employee of the Company or
the Bank or members of their immediate families (which term shall mean
parents, grandparents, spouse, siblings, children and grandchildren) or
any of their respective individual retirement plans; and
(b) With respect to any Securities sold by a NASD member firm (other
than Sandler X'Xxxxx) in the Syndicated Community Offering, (i) the
compensation payable to Selected Dealers, (ii) any sponsoring dealer's
fees; and (iii) a management fee to Sandler X'Xxxxx of ninety basis points
(0.90%) of the aggregate purchase price of the Securities sold in the
Syndicated Community Offering. Any fees payable to Sandler X'Xxxxx for
Securities sold by Sandler X'Xxxxx under any such agreement shall be
limited to an aggregate of six percent (6.00%) of the purchase price of
the Securities sold by Sandler X'Xxxxx and other NASD member firms.
15
If this Agreement is terminated by the Agent in accordance with the
provisions of Section 9(a) hereof, no fee shall be payable by the Company
to Sandler X'Xxxxx; provided, however, that the Company shall reimburse
the Agent for all of its reasonable out-of-pocket expenses incurred prior
to termination, including the reasonable fees and disbursements of counsel
for the Agent in accordance with the provisions of Section 4 hereof. In
addition, the Company shall be obligated to pay the fees and expenses as
contemplated by the provisions of Section 4 hereof in the event of any
such termination.
All fees payable to the Agent hereunder shall be payable in
immediately available funds at Closing Time, or upon the termination of
this Agreement, as the case may be.
SECTION 3. COVENANTS OF THE COMPANY, THE MHC AND THE BANK. The
Company, the MHC and the Bank covenant with the Agent as follows:
(a) The Company, the MHC and the Bank will prepare and file such
amendments or supplements to the Registration Statement, the Prospectus,
the Plan and the Modification as may hereafter be required by the
Securities Act Regulations or the FRB, the NJDBI, the FDIC or as may
hereafter be requested by the Agent. Following completion of the
Subscription and Community Offering, in the event of a Syndicated
Community Offering, the Company, the MHC and the Bank will (i) promptly
prepare and file with the Commission a post-effective amendment to the
Registration Statement relating to the results of the Subscription and
Community Offering, any additional information with respect to the
proposed plan of distribution and any revised pricing information or (ii)
if no such post-effective amendment is required, will file with the
Commission a prospectus or prospectus supplement containing information
relating to the results of the Subscription and Community Offering and
pricing information pursuant to Rule 424 of the Securities Act
Regulations, in either case in a form acceptable to the Agent. The
Company, the MHC and the Bank will notify the Agent immediately, and
confirm the notice in writing, (i) of the effectiveness of any
post-effective amendment of the Registration Statement, the filing of any
supplement to the Prospectus and the filing of any amendment to the
Modification, (ii) of the receipt of any comments from the FRB, the NJDBI,
the FDIC or the Commission with respect to the transactions contemplated
by this Agreement or the Modification, (iii) of any request by the
Commission, the FRB, the NJDBI or the FDIC for any amendment to the
Registration Statement, the Plan or the Modification or any amendment or
supplement to the Prospectus or for additional information, (iv) of the
issuance by the FRB, the NJDBI or the FDIC of any order suspending the
Offerings or the use of the Prospectus or the initiation of any
proceedings for that purpose, (v) of the issuance by the Commission of any
stop order suspending the effectiveness of the Registration Statement or
the initiation of any proceedings for that purpose, and (vi) of the
receipt of any notice with respect to the suspension of any qualification
of the Securities for offering or sale in any jurisdiction. The Company,
the MHC and the Bank will take all necessary action to prevent the
issuance of any stop order and, if any stop order is issued, to obtain the
lifting thereof at the earliest possible moment.
(b) The Company, the MHC and the Bank will give the Agent notice of
its intention to file or prepare any amendment to the Modification or
Registration Statement
16
(including any post-effective amendment) or any amendment or supplement to
the Prospectus (including any revised prospectus which the Company
proposes for use in connection with the Syndicated Community Offering of
the Securities which differs from the prospectus on file at the Commission
at the time the Registration Statement becomes effective, whether or not
such revised prospectus is required to be filed pursuant to Rule 424(b) of
the Securities Act Regulations), will furnish the Agent with copies of any
such amendment or supplement a reasonable amount of time prior to such
proposed filing or use, as the case may be, and will not file any such
amendment or supplement or use any such prospectus to which the Agent or
counsel for the Agent may object.
(c) The Company, the MHC and the Bank will deliver to the Agent as
many signed copies and as many conformed copies of the Modification and
the Registration Statement as originally filed and of each amendment
thereto (including exhibits filed therewith or incorporated by reference
therein) as the Agent may reasonably request, and from time to time such
number of copies of the Prospectus as the Agent may reasonably request.
(d) During the period when the Prospectus is required to be
delivered, the Company, the MHC and the Bank will comply, at their own
expense, with all requirements imposed upon them by the FRB, the NJDBI or
the FDIC, by the applicable Conversion Regulations, as from time to time
in force, and by the Nasdaq National Market, the Securities Act, the
Securities Act Regulations, the Exchange Act, and the rules and
regulations of the Commission promulgated thereunder, including, without
limitation, Regulation M under the Exchange Act, so far as necessary to
permit the continuance of sales or dealing in the Securities during such
period in accordance with the provisions hereof and the Prospectus.
(e) If any event or circumstance shall occur as a result of which it
is necessary, in the opinion of counsel for the Agent, to amend or
supplement the Registration Statement or Prospectus in order to make the
Prospectus not misleading in the light of the circumstances existing at
the time it is delivered to a purchaser, the Company, the MHC and the Bank
will forthwith amend or supplement the Registration Statement or
Prospectus (in form and substance satisfactory to counsel for the Agent)
so that, as so amended or supplemented, the Registration Statement or
Prospectus will not include an untrue statement of a material fact or omit
to state a material fact necessary in order to make the statements
therein, in the light of the circumstances existing at the time it is
delivered to a purchaser, not misleading, and the Company, the MHC and the
Bank will furnish to the Agent a reasonable number of copies of such
amendment or supplement. For the purpose of this subsection, the Company,
the MHC and the Bank will each furnish such information with respect to
itself as the Agent may from time to time reasonably request.
(f) The Company, the MHC and the Bank will take all necessary
action, in cooperation with the Agent, to qualify the Securities for
offering and sale under the applicable securities laws of such states of
the United States and other jurisdictions as the applicable Conversion
Regulations may require and as the Agent and the Company have agreed;
provided, however, that none of the Company, the MHC or the Bank shall be
obligated to file any general consent to service of process or to qualify
as a foreign
17
corporation in any jurisdiction in which it is not so qualified. In each
jurisdiction in which the Securities have been so qualified, the Company,
the MHC and the Bank will file such statements and reports as may be
required by the laws of such jurisdiction to continue such qualification
in effect for a period of not less than one year from the effective date
of the Registration Statement.
(g) The Company authorizes Sandler X'Xxxxx and any Selected Dealer
to act as agent of the Company in distributing the Prospectus to persons
entitled to receive subscription rights and other persons to be offered
Securities having record addresses in the states or jurisdictions set
forth in a survey of the securities or "blue sky" laws of the various
jurisdictions in which the Offerings will be made (the "Blue Sky Survey").
(h) The Company will make generally available to its security
holders as soon as practicable, but not later than 60 days after the close
of the period covered thereby, an earnings statement covering a twelve
month period beginning not later than the first day of the Company's
fiscal quarter next following the effective date of the Registration
Statement (as defined in Rule 158 of the Securities Act Regulations) that
will satisfy the provisions of Section 11(a) of the Securities Act.
(i) During the period ending on the third anniversary of the
expiration of the fiscal year during which the closing of the transactions
contemplated hereby occurs, the Company will furnish to its stockholders
as soon as practicable after the end of each such fiscal year an annual
report (including consolidated statements of financial condition and
consolidated statements of income, stockholders' equity and cash flows,
certified by independent public accountants) and, as soon as practicable
after the end of each of the first three quarters of each fiscal year
(beginning with the fiscal quarter ending after the effective date of the
Registration Statement), the Company will make available to its
stockholders consolidated summary financial information of the Company and
the Bank for such quarter in reasonable detail. In addition, such annual
report and quarterly consolidated summary financial information shall be
made public through the issuance of appropriate press releases at the same
time or prior to the time of the furnishing thereof to stockholders of the
Company.
(j) During the period ending on the third anniversary of the
expiration of the fiscal year during which the closing of the transactions
contemplated hereby occurs, the Company will furnish to the Agent (i) as
soon as publicly available, a copy of each report or other document of the
Company furnished generally to stockholders of the Company or furnished to
or filed with the Commission under the Exchange Act or any national
securities exchange or system on which any class of securities of the
Company is listed, and (ii) from time to time, such other information
concerning the Company as the Agent may reasonably request.
(k) The Company, the MHC and the Bank will conduct the Offerings,
including the formation and operation of the Foundation, in all material
respects in the manner described in the Prospectus and in accordance with
the Plan, the Securities Act Regulations and all other applicable
regulations, decisions and orders, including all applicable terms,
requirements and conditions precedent to the Offerings imposed upon the
Company, the
18
MHC or the Bank by the FRB, the Commission and any other regulatory or
Blue Sky authority.
(l) During the period in which the Prospectus is required to be
delivered, the Company, the MHC and the Bank will comply, at their own
expense, with all requirements imposed by the Commission and the Nasdaq
National Market, or pursuant to the applicable Securities Act Regulations
and Nasdaq National Market Regulations, as from time to time in force.
(m) The Company will promptly inform the Agent upon its receipt of
service with respect to any litigation or administrative action instituted
with respect to the Offerings.
(n) Each of the Company and the Bank will use the net proceeds
received by it from the sale of the Securities in the manner specified in
the Prospectus under "Use of Proceeds."
(o) The Company will report the use of proceeds from the Offerings
on its first periodic report filed pursuant to Sections 13(a) and 15(d) of
the Exchange Act and on any subsequent periodic reports as may be required
pursuant to Rule 463 of the Securities Act Regulations.
(p) The Company will maintain the effectiveness of the Exchange Act
Registration Statement for not less than three years and will use its best
efforts to comply in all material respects with its filing obligations
under the Exchange Act during such period. The Company will use its best
efforts to effect and maintain the listing of the Common Stock on the
Nasdaq National Market and, once listed on the Nasdaq National Market, the
Company will use its best efforts to comply with all applicable corporate
governance standards required by the Nasdaq National Market during such
period. The Company will file with the Nasdaq National Market all
documents and notices required by the Nasdaq National Market of companies
that have issued securities that are traded in the over-the-counter market
and quotations for which are reported by the Nasdaq National Market.
(q) The Company and the Bank will take such actions and furnish such
information as are reasonably requested by the Agent in order for the
Agent to ensure compliance with Rule 2790 of the National Association of
Securities Dealers, Inc.
(r) Other than in connection with the Offerings or any employee
benefit plan or arrangement described in the Prospectus, the Company will
not, without the prior written consent of the Agent, sell or issue,
contract to sell or otherwise dispose of, any shares of Common Stock other
than the Securities and the Foundation Shares for a period of 180 days
following the Closing Time.
(s) During the period beginning on the date hereof and ending on the
later of the fifth anniversary of the Closing Time or the date on which
the Agent receives full payment in satisfaction of any claim for
indemnification or contribution to which it may be entitled pursuant to
Sections 6 or 7 made prior to the fifth anniversary of the Closing Time,
respectively, none of the Company, the MHC or the Bank shall, without the
prior written
19
consent of the Agent, take or permit to be taken any action that could
result in the Bank Common Stock becoming subject to any security interest,
mortgage, pledge, lien or encumbrance.
(t) The Company, the MHC and the Bank will comply with the
conditions imposed by or agreed to with the FRB in connection with its
approval of the Modification and the conduct of the Offering.
(u) The Company shall not deliver the Securities until the Company,
the MHC and the Bank have satisfied each condition set forth in Section 5
hereof, unless such condition is waived by the Agent.
(v) The Company, the MHC and the Bank will furnish to Sandler
X'Xxxxx as early as practicable prior to the Closing Date, but no later
than two (2) full business days prior thereto, a copy of the latest
available unaudited interim consolidated financial statements of the
Company which have been read by KPMG, LLP, as stated in their letters to
be furnished pursuant to subsections (f) and (g) of Section 5 hereof.
(w) During the period in which the Prospectus is required to be
delivered, each of the Company, the MHC and the Bank will conduct its
business in compliance in all material respects with all applicable
federal and state laws, rules, regulations, decisions, directives and
orders, including all decisions, directives and orders of the Commission,
the Nasdaq National Market, the FRB, the NJDBI and the FDIC.
(x) The Bank will not amend the Plan in any manner that would affect
the sale of the Securities or the terms of this Agreement without the
written consent of the Agent.
(y) The Company, the MHC and the Bank will not, prior to the Closing
Time, incur any liability or obligation, direct or contingent, or enter
into any material transaction, other than in the ordinary course of
business consistent with past practice, except as contemplated by the
Prospectus.
(z) The Company, the MHC and the Bank will use all reasonable
efforts to comply with, or cause to be complied with, the conditions
precedent to the several obligations of the Agent specified in Section 5
hereof.
(aa) The Company, the MHC and the Bank will provide the Agent with
any information necessary to carry out the allocation of the Securities in
the event of an oversubscription, and such information will be accurate
and reliable in all material respects.
(bb) The Company, the MHC and the Bank will notify the Agent when
funds have been received for the minimum number of Securities set forth in
the Prospectus.
(cc) The Company and the Bank will comply with the conditions
imposed by or agreed to with the FRB in connection with its approval of
the Plan relating to the establishment and the operation of the
Foundation; the Company and the Bank shall use their best efforts to
ensure that the Foundation submits within the time frames required by
20
applicable law a request to the Internal Revenue Service to be recognized
as a tax-exempt organization under Section 501(c)(3) of the Code; the
Company and the Bank will take no action which will result in the possible
loss of the Foundation's tax exempt status; and neither the Company nor
the Bank will contribute any additional assets to the Foundation until
such time that such additional contributions will be deductible for
federal and state income tax purposes.
(dd) The Company, the MHC and the Bank will use their best efforts
to complete the conditions precedent to the Offerings and the
establishment of the Foundation in accordance with the Plan, the
applicable Conversion Regulations and all other applicable laws,
regulations, decisions and orders, including all material terms,
conditions, requirements and provisions precedent to the Offerings imposed
upon the Company, the MHC or the Bank by the Commission, the FRB, the
NJDBI or the FDIC or any other regulatory authority or Blue Sky authority,
and to comply with those which the regulatory authority permits to be
completed after the Offerings.
SECTION 4. PAYMENT OF EXPENSES. The Company, the MHC and the Bank
jointly and severally agree to pay all expenses incident to the
performance of their obligations under this Agreement, including but not
limited to (i) the cost of obtaining all securities and bank regulatory
approvals, including any required NASD filing fees , (ii) the cost of
printing and distributing the offering materials; (iii) the costs of blue
sky qualification (including fees and expenses of blue sky counsel) of the
shares in the various states; (iv) listing fees; (v) all fees and
disbursements of the Company's counsel, accountants and other advisors;
and (vi) the operational expenses for the Conversion Center (e.g.,
postage, telephones and supplies). In the event the Agent incurs any such
fees and expenses on behalf of the Company, the MHC or the Bank, the Bank
will reimburse the Agent for such fees and expenses whether or not the
Offerings are consummated; provided, however, that the Agent shall not
incur any substantial expenses on behalf of the Company, the MHC or the
Bank pursuant to this Section without the prior approval of the Bank.
The Company, the MHC and the Bank jointly and severally agree to pay
certain expenses incident to the performance of the Agent's obligations
under this Agreement, regardless of whether the Offerings are consummated,
including the filing fees paid or incurred by the Agent in connection with
all filings with the NASD. All fees and expenses to which the Agent is
entitled to reimbursement under this paragraph of this Section 4 shall be
due and payable upon receipt by the Company, the MHC or the Bank of a
written accounting therefor setting forth in reasonable detail the
expenses incurred by the Agent.
SECTION 5. CONDITIONS OF AGENT'S OBLIGATIONS. The Company, the MHC,
the Bank and the Agent agree that the issuance and the sale of Securities
and all obligations of the Agent hereunder are subject to the accuracy of
the representations and warranties of the Company, the MHC and the Bank
herein contained as of the date hereof and the Closing Time, to the
accuracy of the statements of officers and directors of the Company, the
MHC and the Bank made pursuant to the provisions hereof, to the
performance by the Company, the MHC and the Bank of their obligations
hereunder, and to the following further conditions:
21
(a) No stop order suspending the effectiveness of the Registration
Statement shall have been issued under the Securities Act or proceedings
therefor initiated or threatened by the Commission, no order suspending
the Offerings or authorization for final use of the Prospectus shall have
been issued or proceedings therefor initiated or threatened by the
Commission, and no order suspending the sale of the Securities in any
jurisdiction shall have been issued.
(b) At Closing Time, the Agent shall have received:
(1) The favorable opinion, dated as of Closing Time, of
Xxxx Xxxxxx Xxxxxxxx & Xxxxxx, P.C., counsel for the Company,
the MHC and the Bank, in form and substance satisfactory to
counsel for the Agent, to the effect that:
(i) The Company has been duly organized and is
validly existing as a stock holding company chartered
under the laws of the State of Delaware; the MHC has been
duly organized and is validly existing as a mutual holding
company chartered under the laws of the State of New
Jersey; the Bank has been duly organized and is validly
existing as a savings bank chartered under the laws of the
State of New Jersey.
(ii) Each of the Company, the MHC and the Bank has
full corporate power and authority to own, lease and
operate its properties and to conduct its business as
described in the Registration Statement and the Prospectus
and to enter into and perform its obligations under this
Agreement and the transactions contemplated hereby.
(iii) Each of the MHC and the Bank is duly qualified
as a domestic or foreign corporation to transact business
and is in good standing under the laws of the State of New
Jersey and in each other jurisdiction in which such
qualification is required, whether by reason of the
ownership or leasing of property or the conduct of
business, except where the failure to so qualify would not
have a Material Adverse Effect.
(iv) The Company is duly qualified as a domestic and
foreign corporation to transact business and is in good
standing under the law of the State of Delaware, in the
State of New Jersey and in each other jurisdiction in
which such qualification is required, whether by reason of
the ownership or leasing of property or the conduct of
business, except where the failure to so qualify would not
have a Material Adverse Effect.
(v) The authorized capital stock of the Company
consists of 200,000,000 shares of Common Stock and
50,000,000 shares of preferred stock, par value $.01 per
share, and the issued and
22
outstanding capital stock of the Company is 50 shares of
Common Stock, all of which are owned beneficially and of
record by the MHC free and clear of any security
interest, mortgage, pledge, lien, encumbrance or legal
or equitable claim; upon consummation of the Offerings,
and the issuance of the Foundation Shares to the
Foundation immediately upon completion thereof, the
issued and outstanding capital stock of the Company will
be within the range set forth in the Prospectus under
"Capitalization."
(vi) The authorized capital stock of the Bank
consists of 5,000,000 shares of common stock, par value
$2.00 per share, and the issued and outstanding capital
stock of the Bank is 250,000 shares of common stock, all
of which are owned beneficially and of record by the
Company free and clear of any security interest, mortgage,
pledge, lien, encumbrance or legal or equitable claim. All
of the issued and outstanding capital stock of the Bank
has been duly authorized, validly issued and fully paid
and nonassessable and has been issued in compliance with
all federal and state securities laws.
(vii) The Securities and the Foundation Shares have
been duly and validly authorized for issuance and sale;
the Securities, when issued and delivered by the Company
pursuant to the Plan against payment of the consideration
calculated as set forth in the Plan, or contributed by the
Company pursuant to the Plan in the case of the Foundation
Shares, will be duly and validly issued and fully paid and
nonassessable.
(viii) The issuance of the Securities and the
Foundation Shares is not subject to preemptive rights
arising by operation of law, or, to such counsel's
knowledge after due inquiry, otherwise, except for
subscription rights granted pursuant to the Plan.
(ix) The issuance of the Securities and the
Foundation Shares is in compliance with all conditions
imposed upon the Company, the MHC and the Bank by the FRB
under the terms of their written approval, as applicable.
(x) Each of the Company and the MHC is registered as
a bank holding company under the Bank Holding Company Act
of 1956, as amended.
(xi) The Bank is a member of the Federal Home Loan
Bank of New York and the deposit accounts of the Bank are
insured by the FDIC up to the applicable limits.
(xii) Each Subsidiary has been duly incorporated and
is validly existing as a corporation in good standing
under the laws of
23
the jurisdiction of its incorporation, and each of the
Subsidiaries has full corporate power and authority to
own, lease and operate its properties and to conduct its
business as described in the Registration Statement and
Prospectus, and is duly qualified as a foreign
corporation to transact business and is in good standing
in each jurisdiction in which such qualification is
required, whether by reason of the ownership or leasing
of property or the conduct of business, except where the
failure to so qualify would not have a Material Adverse
Effect; the activities of each Subsidiary as described
in the Registration Statement and Prospectus are
permitted to subsidiaries of a New Jersey chartered
savings bank, in the case of the Bank, and a Delaware
chartered stock holding company, in the case of the
Company, by the rules, regulations, resolutions and
practices of the FRB; all of the issued and outstanding
capital stock of each Subsidiary has been duly
authorized and validly issued, is fully paid and
non-assessable and is owned by the MHC or the Bank, as
the case may be, directly, free and clear of any
security interest, mortgage, pledge, lien, encumbrance,
or legal or equitable claim.
(xiii) The Foundation is duly incorporated and is
validly existing as a non-stock corporation in good
standing under the laws of the State of Delaware with
corporate power and authority to own, lease and operate
its properties and to conduct its business as described in
the Prospectus; the Foundation is not a bank holding
company within the meaning of 12 C.F.R. Section 225.2(c)
as a result of the issuance of shares of Common Stock to
it in accordance with the terms of the Plan and in the
amounts as described in the Prospectus; no approvals are
required to establish the Foundation and to contribute the
Foundation Shares thereto as described in the Prospectus
other than those set forth in any written notice or order
of approval or non-objection of the Modification, a copy
of which was provided to the Agent prior to the Closing
Time; and the issuance of the Foundation Shares to the
Foundation is registered pursuant to the Registration
Statement.
(xiv) The FRB has duly approved the Modification and
the Plan; to such counsel's knowledge, such approval
remains in full force and effect and no action is pending,
or to the best of such counsel's knowledge, threatened
respecting the Modification, including the Plan. The
Modification complies as to form in all material respects
with the applicable requirements of the FRB, includes all
documents required to be filed as exhibits thereto, and
is, to the best of such counsel's knowledge after due
inquiry, truthful, accurate and complete.
24
(xv) The execution and delivery of this Agreement,
the incurrence of the obligations herein set forth, and
the consummation of the transactions contemplated hereby,
(A) have been duly and validly authorized by all necessary
corporate action on the part of each of the Company, the
MHC and the Bank, and this Agreement constitutes the
legal, valid and binding agreement of each of the Company,
the MHC and the Bank, enforceable in accordance with its
terms, except as rights to indemnity and contribution
hereunder may be limited under applicable law (it being
understood that such counsel may avail itself of customary
exceptions concerning the effect of bankruptcy, insolvency
or similar laws and the availability of equitable
remedies); (B) will not result in any violation of the
provisions of the certificate of incorporation, articles
of incorporation or charter, as the case may be, or bylaws
of the Company, the MHC, the Bank or any Subsidiary; and,
(C) will not conflict with or constitute a breach of, or
default under, and no event has occurred which, with
notice or lapse of time or both, would constitute a
default under, or result in the creation or imposition of
any lien, charge or encumbrance upon any property or
assets of the Company, the MHC, the Bank or the
Subsidiaries pursuant to any contract, indenture,
mortgage, loan agreement, note, lease or other instrument
to which the Company, the MHC, the Bank or the
Subsidiaries is a party or by which any of them may be
bound, or to which any of the property or assets of the
Company, the MHC, the Bank or the Subsidiaries is subject
that, individually or in the aggregate, would have a
Material Adverse Effect.
(xvi) No approval of any other regulatory or
supervisory or other public authority is required in
connection with the final use of the Prospectus.
(xvii) The Registration Statement is effective under
the Securities Act and, to the best of such counsel's
knowledge, no stop order suspending the effectiveness of
the Registration Statement has been issued under the
Securities Act or, proceedings therefor initiated or
threatened by the Commission.
(xviii) No further approval, authorization, consent
or other order of any public board or body is required in
connection with the execution and delivery of this
Agreement, the issuance of the Securities and the
consummation of the transactions contemplated by the Plan,
except as may be required under the securities or "Blue
Sky" laws of various jurisdictions as to which no opinion
need be rendered.
(xix) At the time the Registration Statement became
effective, the Registration Statement (other than the
financial
25
statements and statistical data included therein, as to
which no opinion need be rendered) complied as to form
in all material respects with the applicable
requirements of the Securities Act and the Securities
Act Regulations.
(xx) The Common Stock conforms to the description
thereof contained in the Prospectus, and the form of
certificate used to evidence the Common Stock complies
with all applicable statutory requirements.
(xxi) To our actual knowledge, there are no legal or
governmental proceedings pending or threatened against or
affecting the Company, the MHC, the Bank or the
Subsidiaries which are required, individually or in the
aggregate, to be disclosed in the Registration Statement
and Prospectus, other than those disclosed therein, and
all pending legal or governmental proceedings to which the
Company, the MHC, the Bank or any Subsidiary is a party or
to which any of their property is subject which are not
described in the Registration Statement, including
ordinary routine litigation incidental to the business,
are, considered in the aggregate, not material.
(xxii) The information in the Prospectus under "Risk
Factors - Persons Who Purchase Stock in the Offering Will
Own a Minority of Investors Bancorp Inc.'s Common Stock
and Will Not Be Able to Exercise Voting Control over Most
Matters Put to a Vote of Stockholders," "Our Stock Value
May be Negatively Affected by Federal Regulations
Restrictively Takeovers and Our Mutual Holding Company
Structure," "Our Policy Regarding Dividends," "Supervision
and Regulation," "Federal and State Taxation," "The
Offering," "Restrictions on the Acquisition of Investors
Bancorp, Inc. and Investors Savings Bank," "Description of
Capital Stock of Investors Bancorp, Inc." and "Legal and
Tax Matters" to the extent that it constitutes matters of
law, summaries of legal matters, documents or proceedings,
or legal conclusions, has been reviewed by them and is
complete and accurate in all material respects.
(xxiii) To our actual knowledge, there are no
contracts, indentures, mortgages, loan agreements, notes,
leases or other instruments required to be described or
referred to in the Registration Statement and Prospectus
or to be filed as exhibits thereto other than those
described or referred to therein or filed as exhibits
thereto and the descriptions thereof or references thereto
are correct, and no default exists, and no event has
occurred which, with notice or lapse of time or both,
would constitute a default, in the due performance or
observance of any material obligation, agreement, covenant
or condition contained in any contract, indenture,
mortgage, loan
26
agreement, note, lease or other instrument so described,
referred to or filed.
(xxiv) The Plan and the establishment and funding of
the Foundation have been duly authorized by the Boards of
Directors of the Company, the MHC and the Bank and, the
FRB's approval of the Plan remains in full force and
effect; the Company, the MHC and the Bank have conducted
the Offerings and the establishment and funding of the
Foundation in all material respects in accordance with the
Plan and all other applicable regulations, decisions and
orders thereunder, including all material applicable
terms, conditions, requirements and conditions precedent
to the Offerings imposed upon the Company, the MHC or the
Bank by the FRB and, no order has been issued by the FRB
to suspend the Offerings and no action for such purpose
has been instituted or threatened by the FRB; and, to the
best of such counsel's actual knowledge, no person has
sought to obtain review of the final action of the FRB in
approving the Plan, including the establishment of the
Foundation.
(xxv) (A) None of the Company, the MHC, the Bank,
the Foundation or any of the Subsidiaries is in violation
of their respective certificates of incorporation,
organization certificate, articles of incorporation or
charter, as the case may be, or bylaws and (B) to such
counsel's actual knowledge, the Company, the MHC, the Bank
and the Subsidiaries are not in default (nor has any event
occurred which, with notice or lapse of time or both,
would constitute a default) in the performance or
observance of any material obligation, agreement, covenant
or condition contained in any contract, indenture,
mortgage, loan agreement, note, lease or other instrument
to which the Company, the MHC, the Bank or the
Subsidiaries is a party or by which the Company, the MHC,
the Bank, the Subsidiaries or any of their property may be
bound.
(xxvii) The Company is not and, upon completion of
the Offerings and the sale of the Common Stock and the
application of the net proceeds as described in the
Prospectus under the caption "How We Intend to Use the
Proceeds from the Offering," will not be required to be
registered as an investment company under the Investment
Company Act of 1940.
(2) The favorable opinion, dated as of Closing Time, of
Xxxxxxx Xxxxxx & Xxxxxxx LLP, counsel for the Agent, with
respect to the matters set forth in Section 5(b)(1)(i), (iv),
(v), (vi), (vii), (ix), (xi), (xiv), (xv), (xvi), (xvii) and
(xviii) and such other matters as the Agent may reasonably
require.
(3) In addition to giving their opinions required by
subsections (b)(l) and (b)(2), respectively, of this Section,
Xxxx Xxxxxx Xxxxxxxx &
27
Xxxxxx, P.C. and Xxxxxxx Xxxxxx & Aguggia LLP shall each
additionally state that nothing has come to their attention
that would lead them to believe that the Registration
Statement (except for financial statements and schedules and
other financial or statistical data included therein, as to
which counsel need make no statement), at the time it became
effective, contained an untrue statement of a material fact or
omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading or
that the Prospectus (except for financial statements and
schedules and other financial or statistical data included
therein, as to which counsel need make no statement), at the
time the Registration Statement became effective or at Closing
Time, included an untrue statement of a material fact or
omitted to state a material fact necessary in order to make
the statements therein, in the light of the circumstances
under which they were made, not misleading.
In giving their opinions, Xxxxxxx Xxxxxx & Xxxxxxx LLP and Xxxx Xxxxxx
Xxxxxxxx & Xxxxxx, P.C. may rely as to matters of fact on certificates of
officers and directors of the Company, the MHC, the Bank and the Subsidiaries
and certificates of public officials, and Xxxxxxx, Xxxxxx & Aguggia, LLP may
also rely on the opinion of Xxxx Xxxxxx Xxxxxxxx & Xxxxxx, P.C. with respect to
matters set forth in Section 5(b)(1)(i), (iv), (v), (vi), (vii), (ix), (xi),
(xiv), (xv), (xvi), (xvii) and (xviii).
(c) At Closing Time referred to in Section 2, the Company, the MHC and the
Bank shall have completed in all material respects the conditions precedent to
the Offerings in accordance with the Plan, applicable laws, regulations,
decisions and orders, including all terms, conditions, requirements and
provisions precedent to the Offerings imposed upon the Company, the MHC or the
Bank by the FRB, or any other regulatory authority other than those which the
FRB permits to be completed after the Offerings.
(d) At Closing Time, there shall not have been, since the date hereof or
since the respective dates as of which information is given in the Registration
Statement and the Prospectus, any material adverse change in the financial
condition, results of operations, business affairs or prospects of the Company,
the MHC, the Bank and the Subsidiaries, considered as one enterprise, whether or
not arising in the ordinary course of business consistent with past practice,
and the Agent shall have received a certificate of the President and Chief
Executive Officer of the Company, of the MHC and of the Bank and the chief
financial or chief accounting officer of the Company, of the MHC and of the
Bank, dated as of Closing Time, to the effect that (i) there has been no such
material adverse change, (ii) there shall have been no material transaction
entered into by the Company, the MHC or the Bank from the latest date as of
which the financial condition of the Company, the MHC or the Bank, as set forth
in the Registration Statement and the Prospectus other than transactions
referred to or contemplated therein and transactions in the ordinary course of
business consistent with past practice (iii) neither the Company, the MHC nor
the Bank shall have received from the FRB, the NJDBI or the FDIC any order or
direction (oral or written) to make any material change in the method of
conducting its business with which it has not complied (which order or
direction, if any, shall have been disclosed in writing to the Agent) or which
materially and adversely would affect the business, financial condition, results
of operations or prospects of the Company, the MHC or the Bank, considered as
one enterprise, (iv) the representations and warranties in Section 1 hereof
28
are true and correct with the same force and effect as though expressly made at
and as of the Closing Time, (v) each of the Company, the MHC and the Bank has
complied with all agreements and satisfied all conditions on its part to be
performed or satisfied at or prior to Closing Time, (vi) no stop order
suspending the effectiveness of the Registration Statement has been issued and
no proceedings for that purpose have been initiated or threatened by the
Commission, and (vii) no order suspending the Subscription and Community
Offering or Syndicated Community Offering or the authorization for final use of
the Prospectus has been issued and no proceedings for that purpose have been
initiated or threatened by the FRB, the NJDBI or the FDIC and no person has
sought to obtain regulatory or judicial review of the action of the FRB, the
NJDBI or the FDIC in approving the Plan in accordance with the applicable
Conversion Regulations nor has any person sought to obtain regulatory or
judicial review of the action of the FRB, the NJDBI or the FDIC in approving the
Plan.
(e) At the Closing Time, the Agent shall have received a certificate of
the Chief Executive Officer and President of the Company, of the MHC and of the
Bank and the Chief Financial Officer of the Company, of the MHC and of the Bank,
dated as of Closing Time, to the effect that (i) they have reviewed the contents
of the Registration Statement and the Prospectus; (ii) based on each of their
knowledge, the Registration Statement and the Prospectus do not contain any
untrue statement of a material fact or omit to state a material fact necessary
in order to make the statements made therein, in light of the circumstances
under which such statements were made, not misleading; and (iii) based on each
of their knowledge, the financial statements and other financial information
included in the Registration Statement and the Prospectus fairly present the
financial condition and results of operations of the Company and the
Subsidiaries as of and for the dates and periods covered by the Registration
Statement and the Prospectus.
(f) At the time of the execution of this Agreement, the Agent shall have
received from KPMG, LLP a letter dated such date, in form and substance
satisfactory to the Agent, to the effect that: (i) they are independent public
accountants with respect to the Company, the MHC, the Bank and the Subsidiaries
within the meaning of the Code of Ethics of the AICPA, the Securities Act and
the Securities Act Regulations, they are registered with the PCAOB, and they are
not in violation of the auditor independence requirements of the Xxxxxxxx-Xxxxx
Act; (ii) it is their opinion that the consolidated financial statements and
supporting schedules included in the Registration Statement and covered by their
opinions therein comply as to form in all material respects with the applicable
accounting requirements of the Securities Act and the Securities Act
Regulations; (iii) based upon limited procedures as agreed upon by the Agent and
KPMG, LLP set forth in detail in such letter, nothing has come to their
attention which causes them to believe that (A) the unaudited consolidated
financial statements and supporting schedules of the Company included in the
Registration Statement do not comply as to form in all material respects with
the applicable accounting requirements of the Securities Act, the Securities Act
Regulations and the Conversion Regulations or are not presented in conformity
with generally accepted accounting principles applied on a basis substantially
consistent with that of the audited consolidated financial statements included
in the Registration Statement and the Prospectus, (B) the unaudited amounts of
net interest income and net income (loss) set forth under "Selected Consolidated
Financial and Other Data" in the Registration Statement and Prospectus do not
agree with the amounts set forth in unaudited consolidated financial statements
as of and for the dates and periods presented under such captions or such
amounts were not determined on a basis
29
substantially consistent with that used in determining the corresponding amounts
in the audited financial statements included in the Registration Statement, (C)
at a specified date not more than five (5) days prior to the date of this
Agreement, there has been any increase in the consolidated long-term or
short-term debt of the Company or any decrease in consolidated total assets, the
allowance for loan losses, total deposits or net worth of the Company, in each
case as compared with the amounts shown in the consolidated statements of
financial conditions included in the Registration Statement or, (D) during the
period from March 31, 2005 to a specified date not more than five (5) days prior
to the date of this Agreement, there were any decreases, as compared with the
corresponding period in the preceding fiscal year, in total interest income, net
interest income, net interest income after provision for loan losses, income
(loss) before income tax expense (benefit) or net income (loss) of the Company,
except in all instances for increases or decreases which the Registration
Statement and the Prospectus disclose have occurred or may occur; and (iv) in
addition to the examination referred to in their opinions and the limited
procedures referred to in clause (iii) above, they have carried out certain
specified procedures, not constituting an audit, with respect to certain
amounts, percentages and financial information which are included in the
Registration Statement and Prospectus and which are specified by the Agent, and
have found such amounts, percentages and financial information to be in
agreement with the relevant accounting, financial and other records of the
Company, the MHC and the Bank identified in such letter.
(g) At Closing Time, the Agent shall have received from KPMG, LLP a
letter, dated as of Closing Time, to the effect that they reaffirm the
statements made in the letter furnished pursuant to subsection (f) of this
Section, except that the specified date referred to shall be a date not more
than five (5) business days prior to Closing Time.
(h) At Closing Time, the Securities and the Foundation Shares shall have
been approved for quotation on the Nasdaq National Market upon notice of
issuance.
(i) At Closing Time, the Agent shall have received a letter from the
Appraiser, dated as of the Closing Time, confirming its appraisal.
(j) At Closing Time, counsel for the Agent shall have been furnished with
such documents and opinions as they may require for the purpose of enabling them
to pass upon the issuance and sale of the Securities and the Foundation Shares
as herein contemplated and related proceedings, or in order to evidence the
accuracy of any of the representations or warranties, or the fulfillment of any
of the conditions, herein contained; and all proceedings taken by the Company in
connection with the issuance and sale of the Securities and the Foundation
Shares as herein contemplated shall be satisfactory in form and substance to the
Agent and counsel for the Agent.
(k) At any time prior to Closing Time, (i) there shall not have occurred
any material adverse change in the financial markets in the United States or
elsewhere or any outbreak of hostilities or escalation thereof or other calamity
or crisis the effect of which, in the judgment of the Agent, is so material and
adverse as to make it impracticable to market the Securities or to enforce
contracts, including subscriptions or orders, for the sale of the Securities,
and (ii) trading generally on either the American Stock Exchange, the New York
Stock Exchange or the Nasdaq Stock Market shall not have been suspended, and
minimum or maximum prices for trading shall not have been fixed, or maximum
ranges for prices for securities have been required, by either of said Exchanges
30
or by order of the Commission or any other governmental authority, and a banking
moratorium shall not have been declared by either Federal, New Jersey or New
York authorities.
(l) At or prior to the Closing Time, the Agent shall have been furnished
with the audited consolidated financial statements of the Company and its
subsidiaries as of June 30, 2005.
SECTION 6. INDEMNIFICATION.
(a) The Company, the MHC and the Bank, jointly and severally, agree to
indemnify and hold harmless the Agent, each person, if any, who controls the
Agent, within the meaning of Section 15 of the Securities Act or Section 20 of
the Exchange Act, and its respective partners, directors, officers, employees
and agents as follows:
(i) from and against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, related to or arising out of the
Offerings (including the establishment of the Foundation and the
contribution of the Foundation Shares thereto by the Company) or any
action taken by the Agent where acting as agent of the Company, the MHC or
the Bank or otherwise as described in Section 2 hereof; provided, however,
that this indemnity agreement shall not apply to any loss, liability,
claim, damage or expense found in a final judgment by a court of competent
jurisdiction to have resulted primarily from the bad faith, willful
misconduct or gross negligence of the Agent;
(ii) from and against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, based upon or arising out of any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement (or any amendment thereto), or the omission or
alleged omission therefrom of a material fact required to be stated
therein or necessary to make the statements therein not misleading or
arising out of any untrue statement or alleged untrue statement of a
material fact contained in the Prospectus (or any amendment or supplement
thereto) or the omission or alleged omission therefrom of a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
(iii) from and against any and all loss, liability, claim, damage
and expense whatsoever, as incurred, to the extent of the aggregate amount
paid in settlement of any litigation, or any investigation or proceeding
by any governmental agency or body, commenced or threatened, or of any
claim whatsoever described in clauses (i) or (ii) above, if such
settlement is effected with the written consent of the Company, the MHC or
the Bank, which consent shall not be unreasonably withheld; and
(iv) from and against any and all expense whatsoever, as incurred
(including, subject to Section 6(c) hereof, the fees and disbursements of
counsel chosen by the Agent), reasonably incurred in investigating,
preparing or defending against any litigation, or any investigation,
proceeding or inquiry by any governmental agency or body, commenced or
threatened, or any claim pending or threatened whatsoever described in
clauses (i) or (ii) above, to the extent that any such expense is not paid
under clause (i), (ii) or (iii) above;
31
provided, however, that the indemnification provided for in this paragraph (a)
shall not apply to any loss, liability, claim, damage or expense to the extent
arising out of any untrue statement or alleged untrue statement of a material
fact contained in the Prospectus (or any amendment or supplement thereto) or the
omission or alleged omission therefrom of a material fact necessary in order to
make the statements therein, in the light of the circumstances under which they
were made, not misleading which was made in reliance upon and in conformity with
the Agent Information.
(b) The Agent agrees to indemnify and hold harmless the Company, the MHC
and the Bank, their directors, each of their officers who signed the
Registration Statement, and each person, if any, who controls the Company within
the meaning of Section 15 of the Securities Act or Section 20 of the Exchange
Act against any and all loss, liability, claim, damage and expense described in
the indemnity contained in subsection (a) of this Section, as incurred, but only
with respect to untrue statements or omissions, or alleged untrue statements or
omissions, of a material fact made in the Prospectus (or any amendment or
supplement thereto) in reliance upon and in conformity with the Agent
Information.
(c) Each indemnified party shall give notice as promptly as reasonably
practicable to each indemnifying party of any action commenced against it in
respect of which indemnity may be sought hereunder, but failure to so notify an
indemnifying party shall not relieve such indemnifying party from any liability
which it may have otherwise than on account of this indemnity agreement. An
indemnifying party may participate at its own expense in the defense of any such
action. In no event shall the indemnifying parties be liable for fees and
expenses of more than one counsel (in addition to no more than one local counsel
in each separate jurisdiction in which any action or proceeding is commenced)
separate from their own counsel for all indemnified parties in connection with
any one action or separate but similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances.
(d) The Company, the MHC and the Bank also agree that the Agent shall not
have any liability (whether direct or indirect, in contract or tort or
otherwise) to the MHC and its members, the Bank, the Company's, the MHC's or the
Bank's creditors relating to or arising out of the engagement of the Agent
pursuant to, or the performance by the Agent of the services contemplated by,
this Agreement, except to the extent that any loss, claim, damage or liability
if found in a final judgment by a court of competent jurisdiction to have
resulted primarily from the Agent's bad faith, willful misconduct or gross
negligence.
(e) In addition to, and without limiting, the provisions of Section
(6)(a)(iv) hereof, in the event that the Agent, any person, if any, who controls
the Agent within the meaning of Section 15 of the Securities Act or Section 20
of the Exchange Act or any of its partners, directors, officers, employees or
agents is requested or required to appear as a witness or otherwise gives
testimony in any action, proceeding, investigation or inquiry brought by or on
behalf of or against the Company, the MHC, the Bank, the Agent or any of its
respective affiliates or any participant in the transactions contemplated hereby
in which the Agent or such person or agent is not named as a defendant, the
Company, the MHC and the Bank, jointly and severally, agree to reimburse the
Agent and its partners, directors, officers, employees or agents for all
reasonable and necessary out-of-pocket expenses incurred by them in connection
with preparing or appearing as a witness or otherwise giving testimony and to
compensate the Agent and its partners, directors, officers, employees or agents
in an amount to be mutually agreed upon.
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SECTION 7. CONTRIBUTION. In order to provide for just and equitable
contribution in circumstances in which the indemnity agreement provided for in
Section 6 hereof is for any reason held to be unenforceable by the indemnified
parties although applicable in accordance with its terms, the Company, the MHC,
the Bank and the Agent shall contribute to the aggregate losses, liabilities,
claims, damages and expenses of the nature contemplated by said indemnity
agreement incurred by the Company, the MHC or the Bank and the Agent, as
incurred, in such proportions (i) that the Agent is responsible for that portion
represented by the percentage that the maximum aggregate marketing fees
appearing on the cover page of the Prospectus bears to the maximum aggregate
gross proceeds appearing thereon and the Company, the MHC and the Bank are
jointly and severally responsible for the balance or (ii) if, but only if, the
allocation provided for in clause (i) is for any reason held unenforceable, in
such proportion as is appropriate to reflect not only the relative benefits to
the Company, the MHC and the Bank on the one hand and the Agent on the other, as
reflected in clause (i), but also the relative fault of the Company, the MHC and
the Bank on the one hand and the Agent on the other, as well as any other
relevant equitable considerations; provided, however, that no person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. For purposes of this Section, each
person, if any, who controls the Agent within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act shall have the same rights to
contribution as the Agent, and each director of the Company, the MHC and the
Bank, each officer of the Company who signed the Registration Statement, and
each person, if any, who controls the Company, the MHC or the Bank within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act
shall have the same rights to contribution as the Company, the MHC and the Bank.
Notwithstanding anything to the contrary set forth herein, to the extent
permitted by applicable law, in no event shall the Agent be required to
contribute an aggregate amount in excess of the aggregate marketing fees to
which the Agent is entitled and actually paid pursuant to this Agreement.
SECTION 8. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE DELIVERY.
All representations, warranties and agreements contained in this Agreement, or
contained in certificates of officers of the Company, the MHC or the Bank
submitted pursuant hereto, shall remain operative and in full force and effect,
regardless of any investigation made by or on behalf of the Agent or any
controlling person, or by or on behalf of the Company, and shall survive
delivery of the Securities and the issuance of the Foundation Shares.
SECTION 9. TERMINATION OF AGREEMENT.
(a) The Agent may terminate this Agreement, by notice to the Company, at
any time at or prior to Closing Time (i) if there has been, since the date of
this Agreement or since the respective dates as of which information is given in
the Registration Statement, any material adverse change in the financial
condition, results of operations, business affairs or prospects of the Company,
the MHC or the Bank, considered as one enterprise, whether or not arising in the
ordinary course of business, (ii) if there has occurred any material adverse
change in the financial markets in the United States or elsewhere or any
outbreak of hostilities or escalation thereof or other calamity or crisis the
effect of which, in the judgment of the Agent, is so material and adverse as to
make it impracticable to market the Securities or to enforce contracts,
including subscriptions or orders, for the sale of the Securities, (iii) if
trading generally on the Nasdaq National Market, the American Stock Exchange or
the New
33
York Stock Exchange has been suspended, or minimum or maximum prices for trading
have been fixed, or maximum ranges for prices for securities have been required,
by either of said Exchanges or by order of the Commission or any other
governmental authority, or if a banking moratorium has been declared by either
Federal, New Jersey or New York authorities, (iv) if any condition specified in
Section 5 shall not have been fulfilled when and as required to be fulfilled;
(v) if there shall have been such material adverse changes in the condition or
prospects of the Company, the MHC or the Bank or the prospective market for the
Company's Securities as in the Agent's good faith opinion would make it
inadvisable to proceed with the offering, sale or delivery of the Securities;
(vi) if, in the Agent's good faith opinion, the price for the Securities
established by the Appraiser is not reasonable or equitable under then
prevailing market conditions, or (vii) if the Offerings are not consummated on
or prior to ___________.
(b) If this Agreement is terminated pursuant to this Section, such
termination shall be without liability of any party to any other party except as
provided in Sections 2 and 4 hereof relating to the reimbursement of expenses
and except that the provisions of Sections 6 and 7 hereof shall survive any
termination of this Agreement.
SECTION 10. NOTICES. All notices and other communications hereunder shall
be in writing and shall be deemed to have been duly given if mailed or
transmitted by any standard form of telecommunication. Notices to the Agent
shall be directed to the Agent at 000 Xxxxx Xxxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx
Xxxx 00000, attention of General Counsel, with a copy to Xxxxxxx Xxxxxx &
Xxxxxxx LLP, 0000 Xxxxxxxxx Xxxxxx, X.X., Xxxxxxxxxx, X.X. 00000, attention of
Xxxx X. Xxxxxxx; notices to the Company, the MHC and the Bank shall be directed
to any of them at Investors Savings Bank, 000 XXX Xxxxxxx, Xxxxx Xxxxx, Xxx
Xxxxxx 00000, attention of Xxxxxx X. Xxxxxxx, with a copy to Xxxx Xxxxxx
Xxxxxxxx & Xxxxxx, P.C., 0000 Xxxxxxxxx Xxxxxx, X.X. Xxxxxxxxxx, X.X. 00000,
attention of Xxxx X. Xxxxxx.
SECTION 11. PARTIES. This Agreement shall inure to the benefit of and be
binding upon the Agent, the Company, the MHC and the Bank and their respective
successors. Nothing expressed or mentioned in this Agreement is intended or
shall be construed to give any person, firm or corporation, other than the
Agent, the Company, the MHC and the Bank and their respective successors and the
controlling persons and the partners, officers and directors referred to in
Sections 6 and 7 and their heirs and legal representatives, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision herein or therein contained. This Agreement and all conditions and
provisions hereof and thereof are intended to be for the sole and exclusive
benefit of the Agent, the Company, the MHC and the Bank and their respective
successors, and said controlling persons, partners, officers and directors and
their heirs, partners, legal representatives, and for the benefit of no other
person, firm or corporation.
SECTION 12. ENTIRE AGREEMENT; AMENDMENT. This Agreement represents the
entire understanding of the parties hereto with reference to the transactions
contemplated hereby and supersedes any and all other oral or written agreements
heretofore made, except for the engagement letter dated October 19, 2004, by and
between the Agent and the Bank, relating to the Agent's providing conversion
agent services to the Company and the Bank. No waiver, amendment or other
modification of this Agreement shall be effective unless in writing and signed
by the parties hereto.
34
SECTION 13. GOVERNING LAW AND TIME. This Agreement shall be governed by
and construed in accordance with the laws of the State of New York applicable to
agreements made and to be performed in said State without regard to the
conflicts of laws provisions thereof. Unless otherwise noted, specified times of
day refer to Eastern time.
SECTION 14. SEVERABILITY. Any term or provision of this Agreement which is
invalid or unenforceable in any jurisdiction shall, as to that jurisdiction, be
ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining terms and provisions of this
Agreement or affecting the validity or enforceability of any of the terms or
provisions of this Agreement in any other jurisdiction. If any provision of this
Agreement is so broad as to be unenforceable, the provision shall be interpreted
to be only so broad as is enforceable.
SECTION 15. HEADINGS. Sections headings are not to be considered part of
this Agreement, are for convenience and reference only, and are not to be deemed
to be full or accurate descriptions of the contents of any paragraph or
subparagraph.
[The next page is the signature page]
35
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof, whereupon
this instrument, along with all counterparts, will become a binding agreement
between the Agent on the one hand, and the Company, the MHC and the Bank on the
other in accordance with its terms.
Very truly yours,
INVESTORS BANCORP, INC.
By:_________________________________
Name:
Title:
INVESTORS SAVINGS BANK
By:________________________________
Name:
Title:
INVESTORS BANCORP, MHC
By:________________________________
Name:
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
SANDLER X'XXXXX & PARTNERS, L.P.
By: Sandler X'Xxxxx & Partners Corp.,
the sole general partner
By:_______________________________
Name:
An Officer of the Corporation
