EXHIBIT 1.2
FORM OF AGENCY AGREEMENT
2,645,682 Shares
(subject to increase up to 3,042,563 shares
in the event of an increase in the pro forma market
value of the Company's Common Stock)
(a Missouri corporation)
Common Stock
(par value $0.01 per share)
AGENCY AGREEMENT
___________ __, 0000
XXXXXXX X'XXXXX & PARTNERS, L.P.
000 Xxxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Liberty Bancorp, Inc., a Missouri corporation (the "Company"), Liberty
Savings Mutual Holding Company, a federal mutual holding company (the "MHC"),
and Liberty Savings Bank, F.S.B., a federally chartered stock 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 2,645,682 shares (subject to increase up to 3,042,563 shares in
the event of an increase in the pro forma market value of the Company's common
stock) of the Company's common stock, par value $0.01 per share (the "Common
Stock"). The shares of Common Stock to be sold by the Company in the Offerings
(as defined below) are hereinafter called the "Securities."
The Securities are being offered for sale in accordance with the Plan of
Conversion and Reorganization (the "Plan") adopted by the Boards of Directors of
the MHC and the Bank pursuant to which the Bank intends to convert from the
mutual to stock holding company form of organization and issue all of its stock
to the Company pursuant to the following steps: (i) the Bank's establishment of
the Company as a Missouri-chartered corporation; (ii) the conversion of the MHC
to an interim federal stock savings bank ("Interim No. 1") and its simultaneous
merger into the Bank, whereupon the outstanding common stock of the Bank held by
the MHC will be canceled; (iii) the establishment by the Company of a second
interim federal stock savings bank ("Interim No. 2"); (iv) the merger of Interim
No. 2 with and into the Bank, with the Bank as the surviving entity; and (v) the
sale and exchange of Common Stock pursuant to the Plan and Office of Thrift
Supervision ("OTS") regulations. As a result of the merger of Interim No. 2 with
and into the Bank, the Bank will become a wholly owned subsidiary of the
Company. The
outstanding shares of common stock of the Bank held by persons other than the
MHC will be converted into Common Stock pursuant to an exchange ratio as defined
in the Plan, which will result in the holders of such shares receiving and
owning in the aggregate approximately the same percentage of the Common Stock to
be outstanding upon the completion of the conversion as the percentage of Bank
common stock owned by them in the aggregate immediately prior to consummation of
the conversion.
Pursuant to the Plan, the Company will offer to certain depositors and
borrowers 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 persons who are Bank stockholders and
second to natural persons and trusts of natural persons who are residents of
Clay, Clinton, Platte and Xxxxxxx Counties, Missouri. 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." The conversion and reorganization of the Bank
from mutual to stock holding company form, the formation of the Company, Xxxxxxx
Xx. 0, Xxxxxxx Xx. 0 and the related mergers, the exchange of Bank's public
stockholders' shares for shares of Common Stock (the "Exchange Shares"), the
acquisition of the capital stock of the Bank by the Company and the Offerings
are hereinafter referred to collectively as the "Conversion." It is acknowledged
that the number of Securities to be sold in the Conversion may be increased or
decreased as described in the Prospectus (as hereinafter defined). 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.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form SB-2 (No. 333-_______), 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
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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 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 Subscription and Community Offering. 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 Conversion- Plan of
Distribution and Marketing Arrangements" of the Prospectus).
(ii) At the time of filing the Registration Statement relating to the
offering of the Securities and at the date hereof, the Company was not, and
is not, an ineligible issuer, as defined in Rule 405. At the time of the
filing of the Registration Statement and at the time of the use of any
issuer free writing prospectus, as defined in Rule 433(h), the Company met
the conditions required by Rules 164 and 433 for the use of a free writing
prospectus. If required to be filed, the Company has filed any issuer free
writing prospectus related to the offered Securities at the time it is
required to be filed under Rule 433 and, if not required to be filed, will
retain such free writing prospectus in the Company's records pursuant to
Rule 433(g) and if any issuer free writing prospectus is
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used after the date hereof in connection with the offering of the
Securities the Company will file or retain such free writing prospectus as
required by Rule 433.
(iii) As of the Applicable Time, neither (i) the Issuer-Represented
General Free Writing Prospectus(es) issued at or prior to the Applicable
Time and the Statutory Prospectus, all considered together (collectively,
the "General Disclosure Package"), nor (ii) any individual
Issuer-Represented Limited-Use Free Writing Prospectus, when considered
together with the General Disclosure Package, included any untrue statement
of a material fact or omitted to state any material fact necessary in order
to make the statements therein, in the light of the circumstances under
which they were made, not misleading. The preceding sentence does not apply
to statements in or omissions from any Prospectus included in the
Registration Statement relating to the offered Securities or any
Issuer-Represented Free Writing Prospectus based upon and in conformity
with written information furnished to the Company by the Agent specifically
for use therein. As used in this paragraph and elsewhere in this Agreement:
1. "Applicable Time" means each and every date when a
potential purchaser submitted a subscription or otherwise
committed to purchase Securities.
2. "Statutory Prospectus", as of any time, means the
Prospectus relating to the offered Securities that is included in
the Registration Statement relating to the offered Securities
immediately prior to that time, including any document
incorporated by reference therein.
3. "Issuer-Represented Free Writing Prospectus" means any
"issuer free writing prospectus," as defined in Rule 433(h),
relating to the offered Securities. The term does not include any
writing exempted from the definition of prospectus pursuant to
clause (a) of Section 2(a)(10) of the 1933 Act, without regard to
Rule 172 or Rule 173.
4. "Issuer-Represented General Free Writing Prospectus"
means any Issuer-Represented Free Writing Prospectus that is
intended for general distribution to prospective investors.
5. "Issuer-Represented Limited-Use Free Writing Prospectus"
means any Issuer-Represented Free Writing Prospectus that is not
an Issuer-Represented General Free Writing Prospectus. The term
Issuer-Represented Limited-Use Free Writing Prospectus also
includes any "bona fide electronic road show," as defined in Rule
433, that is made available without restriction pursuant to Rule
433(d)(8)(ii) or otherwise, even though not required to be filed
with the Commission.
(iv) Each Issuer-Represented Free Writing Prospectus, as of its date
of first use and at all subsequent times through the completion of the
Offerings and sale of the offered Securities or until any earlier date that
the Company notified or notifies the Agent
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(as described in the next sentence), did not, does not and will not include
any information that conflicted, conflicts or will conflict with the
information contained in the Registration Statement relating to the offered
Securities, including any document incorporated by reference therein that
has not been superseded or modified. If at any time following the date of
first use of an Issuer-Represented Free Writing Prospectus there occurred
or occurs an event or development as a result of which such
Issuer-Represented Free Writing Prospectus conflicted or would conflict
with the information contained in the Registration Statement relating to
the offered Securities or included or would include an untrue statement of
a material fact or omitted or would omit to state a material fact necessary
in order to make the statements therein, in the light of the circumstances
prevailing at that subsequent time, not misleading, the Company has
notified or will notify promptly the Agent so that any use of such
Issuer-Represented Free-Writing Prospectus may cease until it is amended or
supplemented and the Company has promptly amended or will promptly amend or
supplement such Issuer-Represented Free Writing Prospectus to eliminate or
correct such conflict, untrue statement or omission. The foregoing two
sentences do not apply to statements in or omissions from any
Issuer-Represented Free Writing Prospectus based upon and in conformity
with written information furnished to the Company by the Agent specifically
for use therein.
(v) The Company has filed with the OTS the Company's application for
approval of its acquisition of the Bank (the "Holding Company Application")
on Form H-(e)1-S promulgated under the savings and loan holding company
provisions of the Home Owners' Loan Act, as amended (the "HOLA") and the
regulations promulgated thereunder. The Company has received written notice
from the OTS of its approval of the acquisition of the Bank, such approval
remains in full force and effect and no order has been issued by the OTS
suspending or revoking such approval and no proceedings therefor have been
initiated or threatened by the OTS. At the date of such approval and at the
Closing Time referred to in Section 2, the Holding Company Application
complied and will comply in all material respects with the applicable
provisions of HOLA and the regulations promulgated thereunder and the
Holding Company Application is truthful and accurate in all material
respects.
(vi) Pursuant to the rules and regulations of the OTS (the "OTS
Regulations"), the MHC has filed with the OTS an Application for Approval
of Conversion on Form AC, and has filed such amendments thereto and
supplementary materials as may have been required to the date hereof (such
application, as amended to date, if applicable, and as from time to time
amended or supplemented hereafter, is hereinafter referred to as the
"Conversion Application"). The Offerings and the Plan have been duly
adopted by the Boards of Directors of the MHC and the Bank and such
adoption has not since been rescinded or revoked. The Conversion
Application, which includes applications to form and merge Interim No. 1
and Interim No. 2, has been approved by the OTS. The Prospectus, the proxy
statement for the solicitation of proxies from MHC members for the special
meeting to approve the Plan (the "Members' Proxy Statement") and the proxy
statement for the solicitation of proxies from Bank stockholders for the
special meeting to approve the Plan (the "Stockholders' Proxy Statement")
all included as part of the Conversion Application have been approved for
use by the OTS, such approval remains
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in full force and effect and no order has been issued by the OTS suspending
or revoking such approval and no proceedings therefor have been initiated
or, to the knowledge of the Company, the MHC or the Bank, threatened by the
OTS. At the date of such approval and at the Closing Time referred to in
Section 2, the Conversion Application complied and will comply in all
material respects with the applicable provisions of the OTS Regulations.
(vii) At the time of their use, the Members' Proxy Statement, the
Stockholders' Proxy Statement and any other proxy solicitation materials
will comply in all material respects with the applicable provisions of the
OTS Regulations and those rules and regulations of the Commission under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), as from
time to time amended or supplemented pursuant to the Exchange Act or
otherwise (the "Exchange Act Regulations") (the Securities Act Regulations
and the Exchange Act Regulations are collectively referred to herein as the
"Commission Regulations"), and will not contain 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. The Company, the MHC and the Bank will promptly
file the Prospectus and any supplemental sales literature with the
Commission and the OTS. 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 OTS
Regulations and the Securities Act Regulations and, at or prior to the time
of their first use, will have received all required authorizations of the
OTS and Commission for use in final form.
(viii) None of the Commission, the OTS, or any "Blue Sky" authority
has, by order or otherwise, prevented or suspended the use of the Members'
Proxy Statement, the Stockholders' Proxy Statement, 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 threatened.
(ix) At the Closing Time referred to in Section 2, the Company, the
MHC and the Bank will have completed the conditions precedent to the
Conversion in accordance with the Plan, the applicable OTS Regulations and
all other applicable laws, regulations, decisions and orders, including all
material terms, conditions, requirements and provisions precedent to the
Conversion imposed upon the Company, the MHC or the Bank by the OTS, the
Federal Deposit Insurance Corporation (the "FDIC"), or any other regulatory
authority, other than those which the regulatory authority permits to be
completed after the Conversion. The Conversion, 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.
(x) FinPro, Inc. (the "Appraiser"), which prepared the valuation of
the Bank as part of the Conversion, has advised the Company, the MHC and
the Bank in writing that it satisfies all requirements for an appraiser set
forth in the OTS Regulations and any interpretations or guidelines issued
by the OTS or its staff with respect thereto.
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(xi) Xxxxxxx Xxxxxx & Company, P.C., the accountants who audited and
reported on the financial statements of the Bank 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 (the "PCAOB"), and such accountants are, with
respect to the Company, the MHC and the Bank, independent certified public
accountants as required by the Securities Act, the Securities Act
Regulations and [OTS] Regulations and such accountants are not in violation
of the auditors independence requirements of the Xxxxxxxx-Xxxxx Act of 2002
(the "Xxxxxxxx-Xxxxx Act").
(xii) The only direct subsidiary of the MHC is the Bank. The Bank does
not have any active subsidiaries. The Bank does not, directly or
indirectly, control any other corporation, limited liability company,
partnership, joint venture, association, trust or other business
organization. Upon completion of the Conversion, the only direct subsidiary
of the Company will be the Bank.
(xiii) The financial statements and the related notes thereto included
in the Registration Statement and the Prospectus present fairly the
financial position of the MHC and the Bank at the dates indicated and the
results of operations, retained earnings, stockholders' 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 OTS
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.
(xiv) 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 and the Bank considered as one enterprise, whether or not
arising in the ordinary course of business, (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,
which are material with respect to the Company, the MHC and the Bank,
considered as one enterprise, (C) 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 and (D) none of the Company, the MHC or the
Bank will have issued any securities or incurred any liability or
obligation, direct or contingent, or borrowed money,
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except borrowings in the ordinary course of business consistent with past
practice from the same or similar sources and in similar amounts as
indicated in the Prospectus.
(xv) The Company has been duly incorporated and is validly existing as
a corporation in good standing under the laws of the State of Missouri with
full corporate power and authority to own, lease and operate its properties
and to conduct its business as described in 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 in the State of Missouri 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 and the Bank, considered as one
enterprise (a "Material Adverse Effect").
(xvi) Upon consummation of the Conversion, the authorized, issued and
outstanding capital stock of the Company will be 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); no shares of Common Stock have been or will be issued
and outstanding prior to the Closing Time referred to in Section 2; at the
time of Conversion, 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 Exchange Shares have been duly
authorized for issuance and, when issued, 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 Exchange
Shares is not subject to preemptive or other similar rights.
(xvii) The MHC has been duly chartered and is validly existing as a
mutual holding company under the laws of the United States of America with
corporate power and authority to own, lease and operate its properties and
to conduct its business as described in the Prospectus and to enter into
and perform its obligations under this Agreement; the MHC is duly qualified
to transact business and in good standing under the laws of the State of
Missouri and is qualified to do business 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 have a Material Adverse Effect on the financial condition,
results of operations, business affairs or prospects of the Company, the
MHC and the Bank, considered as one enterprise; upon consummation of the
Conversion, the MHC will convert into Interim No. 1, which will merge with
and into the Bank, with the Bank being the surviving institution.
(xviii) The MHC has no capital stock. All holders of the savings,
demand or other authorized accounts of the Bank are members of the MHC.
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(xix) The Bank has been duly organized and is validly existing as a
federally chartered savings bank in stock form and upon consummation of the
Conversion will continue to be a federally chartered savings bank in stock
form, in both instances with full corporate power and authority to own,
lease and operate its properties and to conduct its business as described
in the Prospectus and to enter into and perform its obligations under this
Agreement and the transactions contemplated thereby; the Company, the MHC
and the Bank have obtained all licenses, permits and other governmental
authorizations currently required for the conduct of their respective
businesses or required for the conduct of their respective businesses as
contemplated by the Holding Company Application and the Conversion
Application, except where the failure to obtain such licenses, permits or
other governmental authorizations would not have a Material Adverse Effect
on the financial condition, results of operations or business affairs of
the Company, the MHC and the Bank, considered as one enterprise; all such
licenses, permits and other governmental authorizations are in full force
and effect and the Company, the MHC and the Bank are in all material
respects in compliance therewith; neither the Company, the MHC nor the Bank
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 on the financial condition, results of operations or business
affairs of the Company, the MHC and the Bank, considered as one enterprise;
and the Bank is duly qualified to transact business and is in good standing
under the laws of the United States and 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 have a Material Adverse Effect on the financial condition, results of
operations or business affairs of the Company, the MHC and the Bank,
considered as one enterprise.
(xx) The Bank is a member in good standing of the Federal Home Loan
Bank of Des Moines; the deposit accounts of the Bank are insured by the
FDIC up to the applicable limits and upon consummation of the Conversion,
the liquidation account for the benefit of eligible account holders and
supplemental eligible account holders will be duly established in
accordance with the requirements of the OTS Regulations. The Bank is a
"qualified thrift lender" within the meaning of 12 U.S.C. Section 1467a(m).
(xxi) The authorized capital stock of the Bank consists of _______
shares of common stock, par value $_____ per share (the "Bank Common
Stock"), and _________ shares of preferred stock, par value $____ per share
(the "Bank Preferred Stock") of which _________ shares of Bank Common Stock
and no shares of Bank Preferred Stock are issued and outstanding as of the
date hereof; no additional shares of Bank Common Stock and no shares of
Bank Preferred Stock will be issued prior to the Closing Time referred to
in Section 2; the issued and outstanding shares of Bank Common Stock have
been duly authorized and validly issued and are fully paid and
nonassessable and have been issued in compliance with all federal and state
securities laws; the MHC owns 800,000 shares of Bank Common Stock
beneficially and of record free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equity; the terms and
provisions of the Bank Common Stock conform to all statements relating
thereto contained in the Prospectus. At the time of the consummation of the
Conversion,
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immediately following the mergers of Interim No. 1 and Interim No. 2 with
and into the Bank, with the Bank being the surviving institution, the
shares of common stock of Interim No. 2 held by the Company shall be
converted into shares of Bank Common Stock on a one-for-one basis. Upon
consummation of the Conversion, the authorized capital stock of the Bank
will be _____ shares of common stock, par value $____ per share, and
________ shares of preferred stock, par value $____ per share, and the
issued and outstanding capital stock of the Bank will be _______ shares of
Bank Common Stock. The shares of Bank Common Stock to be issued to the
Company will have been duly authorized for issuance and, when issued and
delivered by the Bank pursuant to the Plan against payment of the
consideration described in the Plan and in the Prospectus, will be duly and
validly issued and fully paid and nonassessable, and all such Bank Common
Stock will be owned beneficially and of record by the Company, free and
clear of any security interest, mortgage, pledge, lien, encumbrance or
legal or equitable claim; and the certificates representing the shares of
the Bank Common Stock will conform with the requirements of applicable laws
and regulations; and the issuance of the Bank Common Stock is not subject
to preemptive or similar rights.
(xxii) From the date of their formation until the Closing Time,
neither Interim No. 1 nor Interim No. 2 will be in violation of their
respective charter or bylaws, nor will either Interim No. 1 or Interim No.
2 engage in any business other than in connection with organizational
matters and actions taken in connection with the consummation of the
Conversion.
(xxiii) 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 similar laws and the availability of equitable remedies.
(xxiv) Subsequent to the respective dates as of which information is
given in the Registration Statement and the Prospectus and prior to the
Closing Time, except as otherwise may be indicated or contemplated therein,
none of the Company, the MHC or the Bank will have (A) issued any
securities or incurred any liability or obligation, direct or contingent,
or borrowed money, except borrowings in the ordinary course of business
from the same or similar sources and in similar amounts as indicated in the
Prospectus, or (B) entered into any transaction or series of transactions
which is material in light of the business of the Company, the MHC and the
Bank, considered as one enterprise.
(xxv) 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 securities laws of various jurisdictions.
(xxvi) None of the Company, the MHC or the Bank is in violation of
their respective charters of its certificate of incorporation, organization
certificate, articles of incorporation or charter or bylaws; and none of
the Company, the MHC or the Bank is in
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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 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 defaults that
would not, individually or in the aggregate, have a Material Adverse Effect
on the financial condition, results of operations, business affairs or
prospects of the Company, the MHC and the Bank considered as one
enterprise; 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 Conversion Application which have not been so filed.
(xxvii) The Conversion, 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 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 on the financial condition, results of operations, business affairs
or prospects of the Company, the MHC and the Bank, considered as one
enterprise; nor will such action result in any violation of the provisions
of the respective the certificate of incorporation, organization
certificate, articles of incorporation or charter or bylaws of the Company,
the MHC or the Bank, or any applicable law, administrative regulation or
administrative or court decree.
(xxviii) No labor dispute with the employees of the Company, the MHC
or the Bank exists or, to the knowledge of the Company, the MHC or the
Bank, 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
result in any Material Adverse Effect on the financial condition, results
of operations, business affairs or prospects of the Company, the MHC and
the Bank considered as one enterprise.
(xxix) Each of the Company, the MHC and the Bank has good and
marketable title to all properties and assets for which ownership is
material to the business of the Company, the MHC or the Bank 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 or the Bank, considered as one enterprise;
and all of the leases and subleases material to the business of the
Company, the MHC or the Bank under which the Company, the MHC or the Bank
hold properties, including those described in the Prospectus, are valid and
binding agreements of the Company, the MHC
11
or the Bank, enforceable in accordance with their terms, except as may be
limited by bankruptcy, insolvency or similar laws and availability of
equitable remedies.
(xxx) None of the Company, the MHC or the Bank is in violation of any
order or directive from the OTS, the Commission or any regulatory authority
to make any material change in the method of conducting its respective
businesses; the MHC and its 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 OTS, the FDIC and the Commission). Neither the Company, the MHC nor the
Bank 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 in any material respect the conduct of their business or that in
any material manner relates to their capital adequacy, their credit
policies, their management or their business (each, a "Regulatory
Agreement"), nor has the Company, the MHC or the Bank been advised by any
Regulatory Agency that it is considering issuing or requesting 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 or the Bank which, in
the reasonable judgment of the Company or the Bank, is expected to result
in a Material Adverse Effect on the financial condition, results of
operations, business affairs or prospects of the Company, the MHC and the
Bank considered as one enterprise, or which might materially and adversely
affect the properties or assets thereof or which might materially and
adversely affect the consummation of the Conversion 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 or the Bank.
(xxxi) 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 result in any Material Adverse Effect on the financial
condition, results of operations, business affairs or prospects of the
Company, the MHC and the Bank, considered as one enterprise, or which might
materially and adversely affect the properties or assets thereof, the
performance of this Agreement or the consummation of the Conversion; all
pending legal or governmental proceedings to which the Company, the MHC or
the Bank is a party or of which any of their respective property or assets
is the subject which are not described in the Registration Statement,
12
including ordinary routine litigation incidental to the business, are
considered in the aggregate not material; and there are no material
contracts or documents of the Company, MHC or Bank which are required to be
filed as exhibits to the Registration Statement or Conversion Application
which have not been so filed.
(xxxii) The Company, MHC and Bank have obtained (i) an opinion of its
counsel, Xxxxxxx Xxxxxx & Xxxxxxx, LLP with respect to the legality of the
Securities and the Exchange Shares to be issued and the federal income tax
consequences of the Conversion and (ii) the opinion of Xxxxxxx Xxxxxx &
Company, P.C. with respect to the state tax consequences of the Conversion,
copies of which are filed as exhibits to the Registration Statement; all
material aspects of the aforesaid opinions are accurately summarized in the
Prospectus; the facts and representations upon which such opinions are
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.
(xxxiii) The Company is not and, upon completion of the Conversion and
the Offerings and sale of the Common Stock and the application of the net
proceeds therefrom, will not be, required to be registered under the
Investment Company Act of 1940, as amended.
(xxxiv) All of the loans represented as assets on the most recent
financial statements or selected financial information of the Bank 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 on the financial condition, results
of operations, business affairs or prospects of the Company, the MHC and
the Bank, considered as one enterprise.
(xxxv) To the knowledge of the Company, the MHC and the Bank, 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 8.0% of the Securities
sold in the Conversion, 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.
(xxxvi) Each of the Company, the MHC and the Bank 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
13
assets is compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any differences.
(xxxvii) The Company, the MHC and the Bank 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 and is in 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.
(xxxviii) None of the Company, the MHC or the Bank nor any properties
owned or operated by the Company, the MHC or the Bank is in violation of or
liable under any Environmental Law (as defined below). 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 or the Bank
threatened, relating to the liability of any property owned or operated by
the Company, the MHC or the Bank, 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 on the financial condition, results of operations
or business affairs of the Company, MHC and the Bank, considered as one
enterprise. 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.
(xxxix) The Company, the MHC and the Bank 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. The Company, the MHC and the Bank have no
knowledge of any tax deficiency which has been asserted or could be
asserted against the Company, the MHC or the Bank.
14
(xl) The Company has received all approvals required to consummate the
Conversion, and to have the Securities and Exchange Shares quoted on the
Nasdaq Capital Market effective as of the Closing Time referred to in
Section 2 hereof.
(xli) The Company has filed a registration statement for the
Securities and Exchange Shares under Section 12(g) of the Exchange Act and
such registration statement was declared effective concurrent with the
effectiveness of the Registration Statement.
(xlii) 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 MHC's, Company's or Bank's
officers or directors.
(xliii) The Company, the MHC and the Bank 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.
(xliv) 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
Conversion.
(xlv) The records of eligible account holders, supplemental eligible
account holders, and other depositors or borrower members are accurate and
complete in all material respects.
(xlvi) The Company, the MHC and the Bank are 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 or the
Bank, respectively, would have any liability; each of the Company, the MHC
and the Bank has not incurred and does 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 and the Bank 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.
(xlvii) The Company is in compliance with the applicable provisions of
the Xxxxxxxx-Xxxxx 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 Xxxxxxxx-Xxxxx Act and the Nasdaq corporate governance rules that will
become effective in the future upon their effectiveness.
15
(b) Any certificate signed by any officer of the Company, the MHC or the
Bank 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 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
financial and securities marketing implications of the Appraiser's appraisal of
the Common Stock; (iii) reviewing all offering documents, including the
Prospectus, stock order form 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 Bank
management in scheduling and preparing for meetings with potential investors and
broker-dealers; and (vi) providing such other general advice and assistance 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 and the OTS agrees to extend the period of time in which the
Securities may be sold, 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, subject to the terms and conditions set
forth in a selected dealers' agreement (the "Selected Dealers' Agreement"),
substantially in the form set forth in Exhibit A to this Agreement. Sandler
X'Xxxxx will endeavor to limit the aggregate fees to be paid by the Company, the
MHC and the Bank under any such Selected Dealers' Agreement 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 7.0% of
the aggregate Actual Purchase Price of the Securities sold 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 and the requirements of the Plan, which may result in
limiting the
16
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 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 Xxxxxxx Xxxxxx & Aguggia, LLP, at 10:00 a.m., Eastern Standard 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 (1.0%) of the aggregate purchase price of the Securities
sold in the Subscription and Community Offering, 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, and (ii) 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); and
(b) With respect to any Securities sold by a National Association of
Securities Dealers, Inc. ("NASD") member firm (other than Sandler X'Xxxxx) under
the Selected Dealers' Agreement in the Syndicated Community Offering, (i) the
compensation payable to Selected
17
Dealers under any Selected Dealers' Agreement, (ii) any sponsoring dealer's
fees; and (iii) a management fee to Sandler X'Xxxxx of one percent (1.0%) 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 seven
percent (7.0%) of the purchase price of the Securities sold by Sandler X'Xxxxx
and other NASD member firms under the Selected Dealers' Agreement.
If this Agreement is terminated by the Agent in accordance with the
provisions of Section 9(a) hereof or the Conversion is terminated by the
Company, 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. In recognition of the long lead times involved in the
conversion process, the Bank has made an advance payments to the Agent in the
aggregate amount of $25,000, which shall be credited against any fees or
reimbursement of expenses payable hereunder and any unearned portion thereof
shall be refunded.
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 Conversion
Application, the Members' Proxy Statement and the Stockholders' Proxy Statement
as may hereafter be required by the Commission Regulations or the OTS
Regulations 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 Conversion Application, (ii) of the receipt of
any comments from the OTS or the Commission with respect to the transactions
contemplated by this Agreement or the Plan, (iii) of any request by the
Commission or the OTS for any amendment to the Registration Statement or the
Conversion Application or any amendment or supplement to the Prospectus or for
additional information, (iv) of the issuance by the OTS 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
18
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 make every
reasonable effort 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 represents and agrees that, unless it obtains the prior
consent of the Agent and the Agent represents and agrees that, unless it obtains
the prior consent of the Company, it has not made and will not make any offer
relating to the offered Securities that would constitute an "issuer free writing
prospectus," as defined in Rule 433, or that would constitute a "free writing
prospectus," as defined in Rule 405, required to be filed with the Commission.
Any such free writing prospectus consented to by the Company and the Agent is
hereinafter referred to as a "Permitted Free Writing Prospectus." The Company
represents that it has and will comply with the requirements of Rule 433
applicable to any Permitted Free Writing Prospectus, including timely Commission
filing where required, legending and record keeping. The Company need not treat
any communication as a free writing prospectus if it is exempt from the
definition of prospectus pursuant to Clause (a) of Section 2(a)(10) of the 1933
Act without regard to Rule 172 or 173.
(c) The Company, the MHC and the Bank will give the Agent notice of its
intention to file or prepare any amendment to the Conversion Application or
Registration Statement (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.
(d) The Company, the MHC and the Bank will deliver to the Agent as many
signed copies and as many conformed copies of the Holding Company Application,
the Conversion Application 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.
(e) 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 OTS, by the applicable OTS Regulations, as
from time to time in force, and by the Nasdaq, 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 shares of Common Stock during such period in accordance with the
provisions hereof and the Prospectus.
19
(f) 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.
(g) 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 OTS Regulations may require and as the Agent and the
Company have agreed; provided, however, that neither the Company, the MHC nor
the Bank shall be obligated to file any general consent to service of process or
to qualify as a foreign 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.
(h) 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").
(i) 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 (in form complying with the provisions of
Rule 158 of the Securities Act Regulations) covering a twelve month period
beginning not later than the first day of the Company's fiscal quarter next
following the "effective date" (as defined in said Rule 158) of the Registration
Statement.
(j) During the period ending on the fifth 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), 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
20
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.
(k) During the period ending on the fifth 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.
(l) The Company, the MHC and the Bank will conduct the Conversion in all
material respects in accordance with the Plan, the OTS Regulations, the
Commission Regulations and all other applicable regulations, decisions and
orders, including all applicable terms, requirements and conditions precedent to
the Conversion imposed upon the Company, the MHC or the Bank by the OTS and the
Commission.
(m) The Company, the MHC and the Bank will comply, at their own expense,
with all requirements imposed by the Commission, the OTS, and the Nasdaq or
pursuant to the applicable Commission Regulations, OTS Regulations, and Nasdaq
regulations as from time to time in force.
(n) The Company will promptly inform the Agent upon its receipt of service
with respect to any material litigation or administrative action instituted with
respect to the Conversion or the Offerings.
(o) 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."
(p) 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.
(q) The Company will maintain the effectiveness of the Exchange Act
Registration Statement for not less than three years and will comply in all
material respects with its filing obligations under the Exchange Act. The
Company will use its best efforts to effect and maintain the listing of the
Common Stock on the Nasdaq Capital Market and, once listed on the Nasdaq Capital
Market the Company will comply with all applicable corporate governance
standards required by the Nasdaq Capital Market. The Company will file with the
Nasdaq Capital Market all documents and notices required by the Nasdaq Capital
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
Capital Market.
(r) 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 the National Association of Securities Dealers, Inc.'s
"Interpretation Relating to Free-Riding and Withholding."
21
(s) Other than in connection with 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 or Exchange Shares for a
period of 180 days following the Closing Time.
(t) 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,
respectively, neither the Company, the MHC nor the Bank shall, without the prior
written 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.
(u) The Company, the MHC and the Bank will comply with the conditions
imposed by or agreed to with the OTS in connection with its approval of the
Holding Company Application and the Conversion Application.
(v) During the period ending on the first anniversary of the Closing Time,
the Bank will comply with all applicable law and regulation necessary for the
Bank to continue to be a "qualified thrift lender" within the meaning of 12
U.S.C. Section 1467a(m).
(w) The Company shall not deliver the Securities or the Exchange Shares
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.
(x) The MHC, Company or 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
financial statements of the Bank which have been read by Xxxxxxx Xxxxxx &
Company, P.C., as stated in their letters to be furnished pursuant to
subsections (e) and (f) of Section 5 hereof.
(y) 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 OTS and the Nasdaq Capital Market.
(z) 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 consent of
the Agent.
(aa) 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.
(bb) 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.
22
(cc) 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.
(dd) 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.
(ee) At the Closing Time, (i) the Company, the MHC and the Bank will have
completed the conditions precedent to the Offerings and the Conversion in
accordance with the Plan, the applicable OTS Regulations and all other
applicable laws, regulations, decisions and orders, including all material
terms, conditions, requirements and provisions precedent to the Conversion and
the Offerings imposed upon the Company, the MHC or the Bank by the Commission,
the OTS or any other regulatory authority or Blue Sky authority, and will comply
with those which the regulatory authority permits to be completed after the
Conversion and the Offerings; and (ii) the Conversion and the Offerings will
have been effected in the manner described in the Prospectus and in accordance
with the Plan, the OTS Regulations and all other applicable material laws,
regulations, decisions and orders, including in compliance with all terms,
conditions, requirements and provisions precedent to the Conversion and the
Offerings imposed upon the Company, the MHC and the Bank by the Commission, the
OTS, the FDIC or any other regulatory or Blue Sky authority.
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, (ii) the preparation,
printing and filing of the Registration Statement and the Conversion Application
as originally filed and of each amendment thereto, (iii) the preparation,
issuance and delivery of the certificates for the Securities purchased in the
Offerings and the Exchange Shares, (iv) the fees and disbursements of the
Company's, the MHC's and the Bank's counsel, conversion agent, accountants,
appraiser and other advisors, (v) the qualification of the Securities under
securities laws in accordance with the provisions of Section 3(f) hereof,
including filing fees and the fees and disbursements of counsel in connection
therewith and in connection with the preparation of the Blue Sky Survey, (vi)
the printing and delivery to the Agent of copies of the Registration Statement
as originally filed and of each amendment thereto and the printing and delivery
of the Prospectus and any amendments or supplements thereto to the purchasers in
the Offerings and the Agent, (vii) the printing and delivery to the Agent of
copies of a Blue Sky Survey, and (viii) the fees and expenses incurred in
connection with the listing of the Securities and the Exchange Shares on the
Nasdaq Capital Market. 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 Conversion is 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 Conversion is consummated, including
(i) the filing fees paid or incurred by the Agent in connection with all filings
with the NASD, and (ii) all reasonable out-of-pocket
23
expenses incurred by the Agent relating to the Offerings, including without
limitation, fees and expenses of the Agent's counsel, advertising, promotional,
syndication and travel expenses. 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 the
issuance of the Exchange Shares 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:
(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 or the
OTS 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 Xxxxxxx
Xxxxxx & Xxxxxxx, LLP, 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 incorporated and is validly
existing as a corporation in good standing under the laws of the
State of Missouri; the MHC has been duly organized and is validly
existing as a federal mutual holding company chartered under the
laws of the United States; the Bank has been duly organized and
is validly existing as a federal savings bank in stock form
chartered under the laws of the United States.
(ii) Each of the Company, the MHC and the Bank has the
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 to enter into and
perform its obligations under this Agreement and the transactions
contemplated hereby.
(iii) Each of the Company, the MHC and the Bank has the
authority to transact its business in the State of Missouri.
(iv) The authorized capital stock of the Company consists of
20,000,000 shares of Common Stock and 1,000,000 shares of
preferred stock, par value $.01 per share, of which no shares are
issued and outstanding; upon consummation of the Conversion, the
authorized, issued
24
and outstanding capital stock of the Company will be within the
range set forth in the Prospectus under "Capitalization" and, no
shares of Common Stock have been or will be issued and
outstanding prior to the Closing Time.
(v) The Securities have been duly and validly authorized for
issuance and sale; the Exchange Shares have been duly and validly
authorized for issuance; 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, will be
duly and validly issued and fully paid and nonassessable; the
Exchange Shares, when issued, will be duly and validly issued and
fully paid and nonassessable.
(vi) The issuance of the Securities and the Exchange Shares
is not subject to preemptive or other similar rights arising by
operation of law or regulation or the articles of incorporation,
charter or bylaws of the Company, the MHC or the Bank.
(vii) The Bank is a member in good standing of the Federal
Home Loan Bank of Des Moines.
(viii) The deposit accounts of the Bank are insured by the
FDIC up to the applicable limits.
(ix) Upon consummation of the Conversion, all of the issued
and outstanding capital stock of Interim No. 2 will have been
duly authorized and validly issued and fully paid and
nonassessable, and all such capital stock will be converted into
shares of Bank Common Stock upon the merger of Interim No. 2 with
the Bank and is not subject to any security interest, mortgage,
pledge, lien, encumbrance, claim or equity.
(x) Upon consummation of the Conversion, all of the issued
and outstanding capital stock of the Bank, will be duly
authorized and validly issued and fully paid and nonassessable,
and all such capital stock will be owned beneficially and of
record by the Company free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equity.
(xi) The OTS has duly approved the Holding Company
Application and the Conversion Application (including the
formation and merger of Interim No. 1 and Interim No. 2); to such
counsel's actual knowledge, such approvals remain in full force
and effect and no action is pendingor threatened respecting the
Holding Company Application or the Conversion Application or the
acquisition by the Company of all of the Bank's issued and
outstanding capital stock; the Holding Company Application and
the Conversion Application, including the Plan, comply as to form
in all material respects with the applicable requirements of the
25
OTS, and to such counsel's actual knowledge includes all
documents required to be filed as exhibits thereto, and is
truthful, accurate and complete (other than the financial
statements, notes to financial statements and tabular,
statistical and appraisal data included therein, as to which no
opinion need be rendered); and the Company is duly authorized to
become a savings and loan holding company and is duly authorized
to own all of the issued and outstanding capital stock of the
Bank to be issued pursuant to the Plan.
(xii) At the time of their use, both the Members' Proxy
Statement and the Stockholders' Proxy Statement complied as to
form in all material respects with the requirements of the OTS
Regulations and the Exchange Act Regulations.
(xiii) The Company, the MHC and the Bank have full corporate
power and authority to enter into this Agreement and to
consummate the transactions contemplated hereby and by the Plan.
The execution and delivery of this Agreement and the consummation
of the transactions contemplated hereby, (A) have been duly
authorized by all necessary action on the part of each of the
Company, the MHC and the Bank, (B) will not violate the articles
of incorporation, charter or bylaws of the Company, the MHC or
the Bank, and (C) will not result in a breach of or default, or
result in the creation of any lien, charge or encumbrance under
any agreement filed as an exhibit to the Registration Statement.
(xiv) The 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 thereunder may be limited under
applicable law, and subject to the qualification that (i)
enforcement thereof may be limited by bankruptcy, insolvency,
moratorium, reorganization or other laws (including the laws of
fraudulent conveyance) or judicial decisions affecting the
enforceability of creditors' rights generally or the rights of
creditors of savings banks or financial institutions, the
accounts of which are insured by the FDIC, and (ii) enforcement
thereof is subject to general equity principles (regardless of
whether such enforceability is considered in a proceeding in
equity or at law) and to the effect of certain laws and judicial
decisions upon the availability of injunctive relief and
enforceability of equitable remedies, including the remedies of
specific performance and self-help.
(xv) The Registration Statement has been declared effective
by the Commission under the Securities Act, and such counsel has
been advised by the Commission's staff that no stop order
suspending the effectiveness of the Registration Statement has
been issued under the Securities Act and no proceedings for such
purpose have been initiated or threatened by the Commission.
26
(xvi) The Prospectus has been declared effective and the
Members' Proxy Statement and the Stockholders' Proxy Statement
have been cleared in advance by the OTS and, such counsel has
been advised by the OTS' staff that no order suspending the
effectiveness of the Prospectus or the clearance of the Members'
Proxy Statement and the Stockholders' Proxy Statement has been
issued by the OTS and no proceedings for such purpose have been
initiated or threatened by the OTS.
(xvii) 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 Exchange Shares and the consummation of the
Conversion, except as may be required under the securities or
Blue Sky laws of various jurisdictions as to which no opinion
need be rendered.
(xviii) At the time the Registration Statement became
effective, the Registration Statement (other than the financial
statements and statistical data included therein, as to which no
opinion need be rendered) complied as to form in all material
respects with the requirements of the Securities Act and the
Securities Act Regulations and the OTS Regulations.
(xix) 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.
(xx) To such counsel's actual knowledge, there are no legal
or governmental proceedings pending or threatened against or
affecting the Company, the MHC or the Bank which are required,
individually or in the aggregate, to be disclosed in the
Registration Statement and Prospectus, other than those disclosed
therein.
(xxi) The information in the Prospectus under "Risk
Factors--Stockholders of Liberty Savings Bank who receive Liberty
Bancorp common stock in exchange for their stock in the
conversion will receive lesser rights as stockholders than they
currently have," and "--Office of Thrift Supervision regulations
and anti-takeover provisions in our articles of incorporation
restrict the accumulation of our common stock, which may
adversely affect our stock price," "Our Dividend Policy,"
"Federal and State Taxation," "Regulation and Supervision," "The
Conversion--Description of the Conversion," "--Effect of the
Conversion on Stockholders of Liberty Savings Bank," "--Share
Exchange Ratio," "--Effects of Conversion on Depositors,
Borrowers and Members," "--Material Income Tax Consequences," and
"--Liquidation Rights," "Comparison of Stockholders' Rights,"
"Restrictions on Acquisition of Liberty Bancorp and BankLiberty,"
"Description of Liberty Xxxxxxx
00
Xxxxxxx Xxxxx," and "Legal and Tax Opinions" 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.
(xxii) To such counsel's 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 agreement,
note, lease or other instrument so described, referred to or
filed.
(xxiii) The Plan has been duly authorized by the Boards of
Directors of the Company, the MHC and the Bank, and the Plan has
been approved by the requisite vote of the MHC's members and of
the Bank's stockholders.
(xxiv) To such counsel's actual knowledge, the Company, the
MHC and the Bank have conducted the Conversion in accordance with
applicable requirements of the OTS Regulations (except to the
extent that the requirement to comply was specifically waived by
the OTS), the Plan and all other applicable regulations,
decisions and orders thereunder, including all material
applicable terms, conditions, requirements and conditions
precedent to the Conversion imposed upon the Company, the MHC or
the Bank by the OTS and no order has been issued by the OTS to
suspend the Conversion or the Offerings and no action for such
purpose has been instituted or threatened by the OTS; and no
person has sought to obtain review of the final action of the OTS
in approving the Plan, the Conversion Application or the Holding
Company Application.
(xxv) To such counsel's actual knowledge, neither the
Company, the MHC nor the Bank is in violation of their respective
articles of incorporation, charters or bylaws.
(xxvi) The Company is not and, upon completion of the
Conversion and the Offerings and the sale of the Common Stock and
the application of the net proceeds therefrom, will not be
required to be registered as an investment company under the
Investment Company Act of 1940.
28
(xxvii) The stockholders of the Bank do not have dissenters'
rights or any other rights to dissent from the Conversion and
receive the fair value of their shares of Bank such common stock
under Federal law.
(2) The favorable opinion, dated as of Closing Time, of Xxxx
Xxxxxx Xxxxxxxx & Xxxxxx, P.C., counsel for the Agent, with respect to
the matters set forth in Section 5(b)(1)(i), (iv), (v), (vi) (solely
as to preemptive rights arising by operation of law) (vii), (viii),
(xvi) and (xvii) 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, Xxxxxxx Xxxxxx &
Aguggia, LLP and Xxxx Xxxxxx Xxxxxxxx & Xxxxxx, P.C. 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, or that the General Disclosure Package
as of the Applicable Time, 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 or includes an untrue statement
of a material fact or omitted or omits 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 & Aguggia, 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 and the Bank and certificates of
public officials, and Xxxx Xxxxxx Xxxxxxxx & Xxxxxx, P.C. may also rely on the
opinion of Xxxxxxx Xxxxxx & Aguggia, LLP with respect to matters set forth in
paragraphs (i), (iv), (v), (vi), (ix), (x), (xiii) and (xvii).
(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 Conversion in accordance with the Plan, the applicable OTS Regulations and
all other applicable laws, regulations, decisions and orders, including all
terms, conditions, requirements and provisions precedent to the Conversion
imposed upon the Company, the MHC or the Bank by the OTS, or any other
regulatory authority other than those which the OTS permits to be completed
after the Conversion.
(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 and the Bank, 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
29
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 OTS 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 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 have
complied with all agreements and satisfied all conditions on their 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 OTS and no person has sought to obtain regulatory
or judicial review of the action of the OTS in approving the Plan in accordance
with the OTS Regulations nor has any person sought to obtain regulatory or
judicial review of the action of the OTS in approving the Conversion
Application.
(e) At the Closing Time, the Agent shall have received a certificate of the
Chief Executive Officer and President of the Company and of the Bank and the
Chief Financial Officer of the Company 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; (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 Bank as of and for the dates and periods
covered by the Registration Statement and the Prospectus; (iv) they are
responsible for establishing and maintaining internal controls; (v) they have
designed such internal controls to ensure that material information relating to
the Company and the Bank is made known to them; (vi) they have evaluated the
effectiveness of their internal controls; and (vii) they have disclosed to
Xxxxxxx Xxxxxx & Company, P.C. and the audit committee (A) all significant
deficiencies in the design or operation of internal controls which could
adversely affect the Company's and the Bank's ability to record, process,
summarize, and report financial data, and have identified for the Company's and
the Bank's auditors any material weaknesses in internal controls and (B) any
fraud, whether or not material, that involves management or other employees who
have a significant role in the Company's and the Bank's internal controls.
(f) At the time of the execution of this Agreement, the Agent shall have
received from Xxxxxxx Xxxxxx & Company, P.C. a letter dated such date, in form
and substance
30
satisfactory to the Agent, to the effect that: (i) they are independent public
accountants with respect to the Company, the MHC and the Bank within the meaning
of the Code of Ethics of the AICPA, the Securities Act and the Securities Act
Regulations and the OTS 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 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
Xxxxxxx Xxxxxx & Company, P.C. set forth in detail in such letter, nothing has
come to their attention which causes them to believe that (A) the unaudited
financial statements and supporting schedules of the Bank 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 OTS Regulations or are not presented in conformity with
generally accepted accounting principles applied on a basis substantially
consistent with that of the audited financial statements included in the
Registration Statement and the Prospectus, (B) the unaudited amounts of net
interest income and net income set forth under "Selected Financial and Other
Data" in the Registration Statement and Prospectus do not agree with the amounts
set forth in unaudited financial statements as of and for the dates and periods
presented under such captions or such amounts were not determined on a basis
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 Bank or any decrease in consolidated total assets, the
allowance for loan losses, total deposits or net worth of the Bank, in each case
as compared with the amounts shown in the December 31, 2005 consolidated
statements of financial conditions included in the Registration Statement or,
(D) during the period from December 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 before income tax expense or net income of the Bank, 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 Xxxxxxx Xxxxxx &
Company, P.C. a letter, dated as of Closing Time, to the effect that they
reaffirm the statements made in the letter furnished pursuant to subsection (e)
of this Section, except that the specified date referred to shall be a date not
more than five (5) days prior to Closing Time.
(h) At Closing Time, the Securities and Exchange Shares shall have been
approved for quotation on the Nasdaq Capital Market upon notice of issuance.
31
(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 Exchange 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 Exchange 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, are 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
or by order of the Commission or any other governmental authority, and a banking
moratorium shall not have been declared by either Federal, Missouri or New York
authorities.
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
Conversion 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;
(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 Members' Proxy Statement, Stockholders' Proxy Statement or
Prospectus (or any amendment or supplement thereto), or any
Issuer-Represented Free Writing Prospectus, 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;
32
(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;
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
any Issuer-Represented Free Writing Prospectus, 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. Notwithstanding the foregoing, the indemnification provided for in
this paragraph (a) shall not apply to the Bank to the extent that such
indemnification by the Bank would constitute a covered transaction under Section
23A of the Federal Reserve Act, as amended.
(b) The Agent agrees to indemnify and hold harmless the Company 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), or any Issuer-Represented Free Writing Prospectus, 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.
33
(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, the Bank and its security holders, the Company and its
security holders or the MHC's, the Bank's or the Company'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.
(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.
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.
34
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 any Agent or controlling
person, or by or on behalf of the Company, and shall survive delivery of the
Securities and the Exchange 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, are 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 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, Missouri 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 change 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 Conversion is not consummated on
or prior to December 31, 2006.
(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 Xxxxxxxxx X. Xxxxxx, Principal, with a copy to Xxxxxx
Xxxxxxx, Esquire at Xxxx Xxxxxx Xxxxxxxx & Xxxxxx, P.C., 0000 Xxxxxxxxx Xxxxxx,
X.X., Xxxxx 000, Xxxxxxxxxx, X.X. 00000; notices to the Company, the MHC and the
Bank shall be directed to any of them at 00 Xxxx Xxxxxxxx Xxxxxx, Xxxxxxx,
Xxxxxxxx 00000, Attention of Xxxxx X. Xxxxx, President and Chief Executive
Officer, with a copy to Xxxx X. Xxxxxxxxx, Esquire, at Xxxxxxx Xxxxxx & Xxxxxxx,
LLP, 0000 Xxxxxxxxx Xxxxxx, X.X., Xxxxxxxxxx, X.X. 00000.
35
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 November 4, 2005, by and
between the Agent and the Bank, relating to the Agent's providing conversion
agent services to the Company and the Bank in connection with the Conversion. No
waiver, amendment or other modification of this Agreement shall be effective
unless in writing and signed by the parties hereto.
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]
36
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,
LIBERTY BANCORP, INC.
By:
------------------------------------
Title:
---------------------------------
LIBERTY SAVINGS BANK, F.S.B.
By:
------------------------------------
Title:
---------------------------------
LIBERTY SAVINGS MUTUAL HOLDING COMPANY
By:
------------------------------------
Title:
---------------------------------
CONFIRMED AND ACCEPTED, as of the
date first above written:
-------------------
SANDLER X'XXXXX & PARTNERS, L.P. By:
------------------------------------
By: Sandler X'Xxxxx & Partners Corp., Title:
the sole general partner ---------------------------------
By:
---------------------------------
Vice President
37
EXHIBIT A
2,645,682 Shares
(Maximum Offered to be Sold and Issued in Conversion, subject
to increase up to 3,042,563 shares
under certain circumstances)
Common Stock
(Par Value $0.01 Per Share)
SELECTED DEALER'S AGREEMENT
______________, 200__
Ladies and Gentlemen:
We have agreed to assist Liberty Bancorp, Inc. (the "Company") in
connection with the offer for sale and issuance of shares (the "Shares") of
common stock, par value $0.01 per share, of the Company, to be issued in
connection with the conversion and reorganization of Liberty Savings Bank,
F.S.B., a federally-chartered stock savings bank (the "Bank"), from the mutual
holding company to stock holding company form of organization. The Company, in
connection with its plan to effect such conversion, offered for sale up to
2,645,682 shares for subscription by the Company's and the Bank's employee stock
ownership plan and certain of the Bank's depositors and borrowers, in a
subscription offering, and certain members of the general public in a concurrent
direct community offering. The shares which were not subscribed for pursuant to
such subscription and direct community offerings are being offered to the public
in a syndicated community offering (the "Syndicated Community Offering") in
accordance with the rules of the Office of Thrift Supervision. The balance of
the Shares to be issued in connection with the conversion represent the minority
ownership interest in Liberty Savings Bank, F.S.B., which will be exchanged for
up to ____________ shares of Company common stock (the "Exchange Shares"). The
Shares, the bases on which the number of Shares to be issued may change, and
certain of the terms on which they are being offered are more fully described in
the enclosed Prospectus (the "Prospectus").
We are offering to Selected Dealers (of which you are one) the opportunity
to participate in the solicitation of offers to buy the Shares in the Syndicated
Community Offering, and we will pay you a fee in the amount of _____________
percent (______%) of the dollar amount of the Shares sold on behalf of the
Company by you. The number of Shares sold by you shall be determined based on
the authorized designation of your firm on the order form or forms for such
Shares accompanying the funds transmitted for payment therefor (whether in the
form of a check payable to the Bank or a withdrawal from an existing account at
the Bank) to the special account established by the Company for the purpose of
holding such funds. It is understood, of course, that payment of your fee will
be made only out of compensation received by us for the Shares sold on behalf of
the Company by you, as evidenced in accordance with the preceding sentence. The
Bank has requested us to invite you to become a "Sponsoring Dealer," that is, a
Selected
1
Dealer who solicits offers which result in the sale on behalf of the Bank of at
least ____ shares. You may become a Sponsoring Dealer (subject to your
fulfillment of the requirement in the preceding sentence) by checking the box on
the confirmation at the end of this letter. If you become a Sponsoring Dealer,
you shall be entitled to an additional fee in the amount of _____ percent
(_____%) of the dollar amount of the Shares sold on behalf of the Company by you
as evidenced in the manner set forth above.
Each order form for the purchase of Shares must set forth the identity,
address and tax identification number of each person ordering Shares regardless
of whether the Shares will be registered in street name or in the purchaser's
name. Such order form should clearly identify your firm.
As soon as practicable after all the Shares are sold, we will remit to you,
out of our compensation as provided above, the fees to which you are entitled
hereunder, including your Sponsoring Dealer fee.
This offer is made subject to the terms and conditions herein set forth and
is made only to Selected Dealers which are (i) members in good standing of the
National Association of Securities Dealers, Inc. ("NASD") which agree to comply
with all applicable rules of the NASD, including, without limitation, the NASD's
Interpretation with Respect to Free-Riding and Withholding and Rule 2740 of the
NASD's Conduct Rules, or (ii) foreign dealers not eligible for membership in the
NASD which agree (A) not to sell any Shares within the United States, its
territories or possessions or to persons who are citizens thereof or resident
therein and (B) in making other sales to comply with the above-mentioned NASD
Rules 2730, 2740 and 2750 of the above-mentioned Conduct Rules as if they were
NASD members and Rule 2420 of such Conduct Rules as it applies to non-member
brokers or dealers in a foreign country.
Orders for Shares will be strictly subject to confirmation and we, acting
on behalf of the Company, reserve the right in our absolute discretion to reject
any order in whole or in part, to accept or reject orders in the order of their
receipt or otherwise, and to allot. Neither you nor any other person is
authorized by the Company, the Bank or by us to give any information or make any
representations other than those contained in the Prospectus in connection with
the offering and sale of any of the Shares. No Selected Dealer is authorized to
act as agent for us when soliciting offers to buy the Shares from the public or
otherwise. No Selected Dealer shall engage in any stabilizing (as defined in
Regulation M promulgated under the Securities Exchange Act of 1934, as amended
(the "Exchange Act")) with respect to the Company's common stock during the
offering.
We and each Selected Dealer assisting in selling Shares pursuant hereto
agree to comply with the applicable requirements of the Exchange Act, and
applicable rules and regulations issued by the OTS. In addition, we and each
Selected Dealer confirm that the Securities and Exchange Commission (the "SEC")
interprets Rule 15c2-8 promulgated under the Exchange Act as requiring that a
prospectus be supplied to each person who is expected to receive a confirmation
of sale at least 48 hours prior to delivery of such person's order form.
2
We and each Selected Dealer further agree to the extent that our customers
desire to pay for Shares with funds held by or to be deposited with us, in
accordance with the interpretation of the SEC Rule 15c2-4 promulgated under the
Exchange Act either (a) upon receipt of an executed order form or direction to
execute an order form on behalf of a customer to forward the Syndicated
Community Offering price for the Shares ordered on or before 12:00 p.m. on the
business day following receipt or execution of an order form by us to the Bank
for deposit in a segregated account or (b) to solicit indications of interest in
which event (i) we will subsequently contact any customers indicating interest
to confirm the interest and give instructions to execute and return an order
form or to receive authorization to execute an order form on their behalf, (ii)
we will mail acknowledgments of receipt of orders to each customer confirming
interest on the business day following such confirmation, (iii) we will debit
accounts of such customers on the fifth business day (the "debit date")
following receipt of the confirmation referred to in (i) and (iv) we will
forward completed order forms together with such funds to the Bank on or before
12:00 p.m. on the next business day following the debit date for deposit in a
segregated account. We acknowledge that if the procedure in (b) is adopted, our
customer's funds are not required to be in their accounts until the debit date.
We and each Selected Dealer further acknowledge that, in order to use the
foregoing "sweep arrangements," we comply with the net capital requirements for
broker/dealers under Rule 15c3-1(a)(1) of the Exchange Act.
Unless earlier terminated by us, this Agreement shall terminate 45 full
business days after the date hereof, but may be extended by us for an additional
period or periods not exceeding 30 full business days in the aggregate. We may
terminate this Agreement or any provisions hereof at any time by written or
telegraphic notice to you. Of course, our obligations hereunder are subject to
the successful completion of the offering, including the sale of all of the
Shares.
You agree that at any time or times prior to the termination of this
Agreement you will, upon our request, report to us the number of Shares sold on
behalf of the Company by you under this Agreement.
We shall have full authority to take such actions as we may deem advisable
in respect to all matters pertaining to the offering. We shall be under no
liability to you except for lack of good faith and for obligations expressly
assumed by us in this Agreement.
Upon application to us, we will inform you as to the states in which we
believe the Shares have been qualified for sale under, or are exempt from the
requirements of, the respective blue sky laws of such states, but we assume no
responsibility or obligation as to your rights to sell Shares in any state.
Additional copies of the Prospectus and any supplements thereto will be
supplied in reasonable quantities upon request.
We will not use any free writing prospectus, unless consented to by you or
authorized expressly in writing to you by the issuer in the offering.
3
Any notice from us to you shall be deemed to have been duly given if
mailed, telephoned or telegraphed to you at the address to which this Agreement
is mailed.
This Agreement shall be construed in accordance with the laws of New York.
Please confirm your agreement hereto by signing and returning the
confirmation accompanying this letter at once to us at Sandler X'Xxxxx &
Partners, L.P., 000 Xxxxx Xxxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000. The
enclosed duplicate copy will evidence the agreement between us.
Very truly yours,
SANDLER X'XXXXX & PARTNERS, L.P.
By: Sandler X'Xxxxx & Partners Corp.,
the sole general partner
By:
------------------------------------
4
Sandler X'Xxxxx & Partners, L.P.
000 Xxxxx Xxxxxx - 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: _____________________
Ladies and Gentlemen:
We hereby confirm our agreement to all the terms and conditions stated in
the foregoing letter. We acknowledge receipt of the Prospectus relating to the
Shares and we further state that in agreeing thereto we have relied upon the
Prospectus and no other statement whatsoever, written or oral. We confirm that
we are (i) a member on good standing of the National Association of Securities
Dealers, Inc. ("NASD"), and agree to comply with all applicable rules of the
NASD, including, without limitation, the NASD's "Interpretation With Respect to
Free-Riding and Withholding" and Rule 2740 of the NASD's Conduct Rules, or (ii)
a foreign dealer not eligible for membership in the NASD and agree (A) not to
sell any Shares of ___________________ within the United States, its territories
or possessions or to persons who are citizens thereof or resident therein and
(B) in making other sales to comply with the above-mentioned NASD Rules 2730,
2740 and 2750 of the above-mentioned Conduct Rules as if we were an NASD member
and Rule 2420 of such Conduct Rules as it applies to a non-member broker or
dealer in a foreign country.
[___] We wish to become a "Sponsoring Dealer."
Dated:
------------------------------
-------------------------------------
(Please print or type name of firm)
By:
------------------------------------
