AGENCY AGREEMENT PVF Capital Corp. (an Ohio corporation) Up to 17,142,857 Shares of Common Stock Including Subscription Rights to Purchase up to 14,706,247 Shares of Common Stock February 17, 2010
Exhibit 1.1
Up to 17,142,857 Shares of Common Stock
Including Subscription Rights to Purchase up to 14,706,247 Shares of Common Stock
Including Subscription Rights to Purchase up to 14,706,247 Shares of Common Stock
February 17, 2010
Xxxxxx, Xxxxxxxx & Company, Incorporated
00 Xxxxxxxx Xxxxxxxx
Xxxxxxx Xxxx, Xxx Xxxxxx 00000
00 Xxxxxxxx Xxxxxxxx
Xxxxxxx Xxxx, Xxx Xxxxxx 00000
Ladies and Gentlemen:
PVF Capital Corp., an Ohio corporation (the “Company”) hereby confirms the agreement with
Xxxxxx, Xxxxxxxx & Company, Incorporated (the “Agent”), subject to the terms and conditions set
forth below, with respect to the proposed distribution by the Company to its shareholders of rights
entitling their holders to subscribe for shares of the Company’s common stock, par value $0.01 per
share (the “Common Stock”).
Section 1. The Offering The Company is distributing, at no charge, subscription
rights to purchase shares of Common Stock to the holders of record of its Common Stock (a “Record
Date Shareholder”) at 5:00 p.m. Eastern Time, on January 27, 2010 (the “Record Date”) and, subject
to the rights of such holders described below, to certain other purchasers on a standby basis.
Each Record Date Shareholder will receive one non-transferable subscription right (a “Right”) for
every share of Common Stock held of record at the close of business on the Record Date. Each Right
will entitle the holder thereof to subscribe for a certain number of shares of Common Stock (the
“Underlying Shares”) at $1.75 per share (the “Subscription Price”) (the “Basic Subscription
Privilege”). Each Record Date Shareholder who exercises in full its Basic Subscription Privilege
will also be eligible to subscribe at the Subscription Price for shares of Common Stock not
otherwise purchased pursuant to the exercise of the Basic Subscription Privilege up to the total
number of Underlying Shares, subject to availability, proration and reduction by the Company in
certain circumstances and, in all instances, to a limit on ownership of the Common Stock (the
“Over-Subscription Privilege”). The Agent shall deposit with the Escrow Agent (as defined herein)
the funds it receives from each of the Record Date Shareholders prior to the end of business on
each business day it receives such payments. The offer and sale of the Underlying Shares pursuant
to the exercise of the Basic Subscription Privilege and the Over-Subscription Privilege are
referred to herein as the “Rights Offering.”
The Company has separately entered into a “Standby Purchase Agreement” with Xxxxx Xxxxxxx
Partners II, L.P. (the “Standby Purchaser”), pursuant to which the Standby Purchaser has agreed to
acquire from the Company, at the Subscription Price, the lesser of 2,436,610 shares of Common Stock
or 9.61% of the Company’s outstanding Common Stock on a fully diluted
basis assuming completion of the Rights Offering, including shares issued to the Standby
Purchaser. The Standby Purchaser has conditioned its minimum purchase of shares of Common
Stock
upon the receipt by the Company of $26.0 million in gross proceeds from the Rights Offering, the
offering to the Standby Purchaser and the Public Reoffer (as defined below), if any. The maximum
number of shares that may be sold in the Rights Offering and to the Standby Purchaser is
17,142,857.
The Company may offer any shares of Common Stock that remain unsubscribed in the Rights
Offering at the expiration of the Rights Offering to the public at the Subscription Price per share
(the “Public Reoffer”). Any offering of shares of Common Stock in the Public Reoffer shall be on a
best efforts (and not an underwritten) basis. The Public Reoffer, if any, shall terminate on April
9, 2010. The Rights Offering, the offering to the Standby Purchaser and the Public Reoffer are
together referred to herein as the “Stock Offering,” and the Underlying Shares and the shares of
Common Stock sold to the Standby Purchaser and to the public in the Public Reoffer are collectively
referred to herein as the “Securities.”
In connection with the Stock Offering, the Company has filed with the Securities and Exchange
Commission (the “Commission”) a registration statement on Form S-1 (No. 333-163037) including the
related preliminary prospectus or prospectuses covering the registration of the Securities under
the Securities Act of 1933, as amended (the “Securities Act”). Promptly after execution and
delivery of this Agreement, the Company will prepare and file a prospectus in accordance with the
provisions of Rule 430A (“Rule 430A”) of the rules and regulations of the Commission under the
Securities Act (the “Securities Act Regulations”) and paragraph (b) of Rule 424 (“Rule 424(b)”) of
the Securities Act Regulations. The information included in such prospectus that was omitted from
such registration statement at the time it became effective but that is deemed to be part of such
registration statement at the time it became effective pursuant to paragraph (b) of Rule 430A is
referred to as “Rule 430A Information.” Each prospectus used before such registration statement
became effective, and any prospectus that omitted Rule 430A Information that was used after such
effectiveness and prior to the execution and delivery of this Agreement, is herein called a
“preliminary prospectus.” Such registration statement, including the exhibits, and the schedules
thereto, if any, and any documents incorporated by reference therein pursuant to Item 12 of Form
S-1 under the Securities Act at the time it became effective and including the Rule 430A
Information, is herein called the “Registration Statement.” The final prospectus, including the
preliminary prospectus, and any documents incorporated by reference therein, in the form first
furnished to the Agent for use in connection with the offering of the Securities is herein called
the “Prospectus.” For purposes of this Agreement, all references to the Registration Statement,
any preliminary prospectus, the Prospectus or any amendment or supplement to any of the foregoing
shall be deemed to include the copy filed with the Commission pursuant to its Electronic Data
Gathering, Analysis and Retrieval system (“XXXXX”).
Section 2. Appointment of Agent Subject to the terms and conditions of this
Agreement, the Company hereby appoints the Agent as its exclusive financial and marketing advisor
and information agent to use its best efforts to solicit the exercise of Rights and to advise and
assist the Company in connection with the Stock Offering, including the Public Reoffer. It is
acknowledged by the Company that the
Agent shall not be obligated to purchase any shares of Common Stock, Rights, or Securities and
shall not be obligated to take any action that is inconsistent with any applicable law, regulation,
decision or order.
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The Company and the Agent agree that the Agent is an independent contractor with respect to
its solicitation of the Standby Purchaser and the exercise of Rights contemplated by this Agreement
and the performance of any financial advisory services to the Company contemplated by this
Agreement or otherwise.
In rendering the services contemplated by this Agreement, the Agent will not be subject to any
liability to the Company or any of its affiliates for any act or omission on the part of any
securities broker or dealer (other than the Agent or employees of the Agent) or any other person,
and the Agent will not be liable for acts or omissions in performing its obligations under this
Agreement, except for any losses, claims, damages, liabilities and expenses determined in a final
judgment by a court of competent jurisdiction to have resulted from any acts or omissions
undertaken or omitted to be taken by the Agent through its gross negligence or willful misconduct.
Section 3. Subsequent Agreements With The Standby Purchaser The Company agrees to use
its best efforts to provide in the Standby Purchase Agreement and in any subsequent agreements
entered into in connection with the Public Reoffer that the Agent will be permitted to rely as a
third party beneficiary on any representations, warranties, agreements, covenants and other
provisions, including opinions of counsel (in each case relating to the applicable Standby
Purchaser) contained in the agreements and documents entered into between the Company and the
Standby Purchaser.
Section 4. Fees In addition to the expenses specified in Section 8 hereof, as
compensation for the Agent’s services under this Agreement, the Agent has received or will receive
the following fees from the Company; provided, however, notwithstanding anything to the contrary in
this Agreement or the Letter Agreement (as defined below), in the event the Stock Offering is not
completed the Agent will receive only a reimbursement of out-of-pocket accountable expenses
actually incurred and fees with respect to Advisory Services (as defined below) that have been
actually performed by the Agent.
(a) An advisory fee (the “Advisory Fee”), in consideration for the Agent’s work in advising
the Company with respect to the increase in the Company’s authorized shares, the Company’s 2010
annual meeting of shareholders, shareholder voting, press releases and debt restructuring
(collectively “Advisory Services”), equal to (i) $25,000 paid as an advance upon the execution of
the letter agreement, dated November 6, 2009, by and between the Company and the Agent (the “Letter
Agreement”), (ii) $25,000 payable on the 30th day of each month (with respect to Advisory Services
actually performed during such month) during the term of the Letter Agreement, commencing on
November 30, 2009 (clause (i) and (ii), collectively, the “Periodic Advisory Fee”) and (iii) the
difference of $825,000 and the sum of all Periodic Advisory Fees paid to date which will be due and
payable to the Agent on the date of the Initial
Closing. The Company confirms that all Periodic Advisory Fees are payable in respect of
Advisory Services actually performed by the Agent.
(b) A placement fee (the “Placement Fee”) of up to 6.00% (600 basis points) of the aggregate
dollar amount of the Common Stock sold to the Standby Purchaser and sold in the Public Reoffer.
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Notwithstanding anything to the contrary herein, the Agent may, in its sole discretion, pay
selected dealers a concession fee in the aggregate not exceeding $300,000.
(c) In addition, if requested by the board of directors of the Company (the “Board of
Directors”) or a special committee of the Board of Directors (the “Special Committee”), the Agent
shall render an opinion to the Board of Directors or the Special Committee as to the fairness, from
a financial point of view, to the Company of financial terms of the Rights Offering (an “Opinion”).
It is understood that an Opinion will be dated as of a date reasonably proximate to the closing of
the Rights Offering and will be subject to such qualifications and assumptions as the Agent deems
necessary or advisable in its professional judgment. It is further understood that, if an Opinion
is requested to be included in the Registration Statement or Prospectus relating to the Rights
Offering or a proxy statement distributed in connection with a shareholders’ meeting of the Company
and the Agent consents to such inclusion, the Opinion will be reproduced in such Registration
Statement, Prospectus or proxy statement in full, and any description of or reference to the Agent
or summary of the Opinion in such Registration Statement, Prospectus or proxy statement will be in
a form reasonably acceptable to the Agent and its counsel and consistent with similar descriptions
or references in transactions of this type. In rendering an Opinion, the Agent will direct its
advice solely to the Board of Directors or Special Committee, as applicable, and such advice will
not constitute a recommendation to any shareholder of the Company as to how such shareholder should
vote at any shareholders’ meeting held in connection with the Rights Offering or whether or not
such shareholder should exercise any rights received in connection with the Rights Offering or vote
in favor of any Rights Offering. An Opinion will not be reproduced, summarized, described or
referred to without the Agent’s prior written consent.
In consideration for the Agent rendering the Opinion, the Company shall pay the Agent a fee of
$100,000, payable upon delivery of the Agent’s Opinion (the “Opinion Fee”), if such Opinion is
requested by the Company. The Opinion Fee shall be earned when paid and shall be nonrefundable,
even in the event that the Agent is unable to provide its opinion that the financial terms of the
Rights Offering are fair, from a financial point of view, to the Company, or if the Company or any
other party determines not to proceed with the subject Rights Offering.
In compliance with Financial Industry Regulatory Authority (“FINRA”) Rule 5110(f)(2)(C), the
Agent will not receive any payment of commissions or reimbursement of expenses prior to the
commencement of the Stock Offering, except a reasonable advance against out of pocket accountable
expenses actually anticipated to be incurred by the Agent, which advance is reimbursed to the
Company to the extent not actually incurred and provided that the Agent may receive payment for
applicable Periodic Advisory Fees for Advisory Services that were actually performed by the Agent
(as described in more detail below). The Advisory Fee,
the Placement Fee and the Opinion Fee are non-negotiable and are not subject to any reduction,
set-off, counterclaim or refund for any reason.
If this Agreement is terminated in accordance with the provisions of Section 9 or 13 hereof or
the sale of the Securities is not consummated, notwithstanding anything to the contrary in this
Agreement or the Letter Agreement, the Agent will receive only the Opinion Fee (if applicable), the
Periodic Advisory Fee and a reimbursement of out-of-pocket accountable
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expenses actually incurred;
provided, however, that the Periodic Advisory Fee shall not exceed, in the aggregate, $150,000.
Section 5. Closing If at least the minimum number of Securities, as disclosed on the
cover of the Prospectus, is sold, the Company agrees to issue or have issued the Securities sold
and to deliver the certificates, or other evidence, for such Securities at the Closing Times (as
defined below) against payment therefore by release of funds from the escrow agent Northern Trust
Corporation (the “Escrow Agent”), (the “Initial Closing”). In addition, the Public Reoffer shall
expire at the earlier of 5:00 p.m. Eastern Time, on April 9, 2010 or the date on which the Company
shall have accepted subscriptions for all shares of Common Stock remaining for purchase as
reflected in the Prospectus Supplement (the “Reoffer Closing”). The Initial Closing shall be held
at the offices of Xxxxxxxxxx Xxxxxxxx LLP in Washington, D.C., at 10:00 a.m., Eastern Time, on 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. At the Initial Closing, the Company shall deliver to the Agent
by wire transfer in same-day funds the commissions, fees and expenses owing to the Agent as set
forth in Sections 4 and 8 hereof and the opinions required hereby and other documents deemed
reasonably necessary by the Agent shall be executed and delivered to effect the Stock Offering and
the issuance of the Securities as contemplated hereby and pursuant to the terms of the Prospectus.
The Company shall notify the Agent by telephone, confirmed in writing, when funds shall have been
received for all the Securities. Certificates or other evidence of the Securities shall be
delivered directly to the purchasers thereof in accordance with their instructions. The date upon
which the Company shall release for delivery all of the Securities, in accordance with the terms
hereof, is herein called the “Initial Closing Date.” The hour on the Closing Date at which the
Company shall release for delivery all of the Securities in accordance with the terms hereof is
called the “Initial Closing Time.” The date upon which the Company shall release for delivery all
of the Securities, in accordance with the terms of the Public Reoffer, is herein called the
“Reoffer Closing Date.” The hour on the Reoffer Closing Date at which the Company shall release
for delivery all of the Securities in connection with the Public Reoffer and in accordance with the
terms hereof is called the “Reoffer Closing Time” and, together with the Initial Closing Time, the
“Closing Times”).
Section 6. Representations and Warranties of the Company
The Company represents and warrants to the Agent on each of the date hereof, the Initial
Closing Date and the Reoffer Closing Date that:
(a) The Company has all such power, authority, authorizations, approvals and orders as may be
required to enter into this Agreement, to carry out the provisions and conditions
hereof and to distribute the Rights and issue and sell the Securities as provided herein and
as described in the Prospectus. Subject to receipt of shareholder approval of the sale to the
Standby Purchaser and an amendment to the Company’s First Amended and Restated Articles of
Incorporation to increase the number of shares of authorized Common Stock (in each case as
described in the Prospectus) (collectively, the “Shareholder Approvals”), the execution, delivery
and performance of this Agreement and the consummation of the transactions contemplated herein have
been duly and validly authorized by all necessary corporate action on the part of the Company.
This Agreement has been validly executed and delivered by the Company, and, assuming due
authorization, execution and delivery by the Agent, is a valid, legal
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and binding obligation of the
Company enforceable in accordance with its terms, except to the extent that such enforceability may
be limited by bankruptcy laws, insolvency laws, or other laws affecting the enforcement of
creditors’ rights generally, or the rights of creditors of savings institutions insured by the
Federal Deposit Insurance Corporation (“FDIC”) (including the laws relating to the rights of the
contracting parties to equitable remedies) (the “Bankruptcy and Equitable Relief Exception”).
(b) The agreement by and between the Company and the subscription agent, Computershare Trust
Company, N.A. (the “Subscription Agent”), (the “Subscription Agent Agreement”) has been duly
authorized, executed and delivered by the Company and, assuming due authorization, execution and
delivery by the Subscription Agent, constitutes a legal, valid and binding obligation of the
Company enforceable in accordance with its terms, except to the extent that such enforceability may
be limited by the Bankruptcy and Equitable Relief Exception.
(c) The agreement by and among the Company, the Agent and the Escrow Agent (the “Escrow
Agreement”) has been duly authorized, executed and delivered by the Company and, assuming due
authorization, execution and delivery by the Agent and the Escrow Agent, constitutes a legal, valid
and binding obligation of the Company enforceable in accordance with its terms, except to the
extent that such enforceability may be limited by the Bankruptcy and Equitable Relief Exception.
(d) The Registration Statement was declared effective by the Commission on February 3, 2010
and no stop order has been issued with respect thereto and no proceedings therefore have been
initiated or, to the knowledge of the Company, threatened by the Commission, and any request on the
part of the Commission for additional information has been complied with. At the time the
Registration Statement, including the Prospectus contained therein (including any amendment or
supplement thereto), became effective, the Registration Statement complied as to form in all
material respects with the Securities Act and the Securities Act Regulations, and the Registration
Statement, including the Prospectus contained therein (including any amendment or supplement
thereto), any Blue Sky Application or any Sales Information (as such terms are defined in Section
10 hereof) authorized by the Company for use in connection with the Stock Offering, did 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, in light of the circumstances under which they
were made, not misleading, and at the time any Rule 424(b) or 424(c) Prospectus was filed with the
Commission and at the Closing Times referred to in Section 5, the Registration Statement, including
the Prospectus contained therein (including any amendment or supplement thereto), and any Blue Sky
Application or any Sales Information authorized by the Company for use in connection with the Stock
Offering, 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 light of the circumstances under which they were made,
not misleading; provided, however, that the representations and warranties in this Section 6(d)
shall not apply to statements or omissions made in reliance upon and in conformity with written
information furnished to the Company by the Agent expressly regarding the Agent for use under the
caption “Plan of Distribution”, in the Prospectus (the “Agent Information”).
(e) At the time of filing the Registration Statement and any post-effective amendments
thereto, at the earliest time thereafter that the Company or another offering
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participant made a
bona fide offer (within the meaning of Rule 164(h)(2) of the Securities Act Regulations) of the
Securities and at the date hereof, the Company was not an “ineligible issuer” as defined in Rule
405 of the Securities Act Regulations (“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) of the Securities Act Regulations, the Company met the conditions required by Rules 164 and
433 of the Securities Act Regulations (“Rule 433”) for the use of a free writing prospectus. If
required to be filed, the Company has timely filed or will timely file 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 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.
(f) 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 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 the
Agent Information. As used in this paragraph and elsewhere in this Agreement:
(i) “Applicable Time” means each and every date when a potential purchaser submitted a
subscription or otherwise committed to purchase Securities.
(ii) “Issuer-Represented Free Writing Prospectus” means any “issuer free writing
prospectus,” as defined in Rule 433(h), relating to the offered Securities that is required
to be filed with the Commission by the Company or required to be filed with the Commission.
The term does not include any writing exempted from the definition of prospectus pursuant to
clause (a) of Section 2(a)(10) of the Securities Act.
(iii) “Issuer-Represented General Free Writing Prospectus” means any Issuer-Represented
Free Writing Prospectus that is intended for general distribution to prospective investors.
(iv) “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.
(v) “Statutory Prospectus,” as of any time, means the Prospectus relating to the offered Securities that is included in the Registration Statement relating to
7
the offered
Securities immediately prior to that time, including any document incorporated by reference
therein.
(g) Each Issuer-Represented Free Writing Prospectus, as of its date of first use and at all
subsequent times through the completion of the Stock Offering and sale of the offered Securities or
until any earlier date that the Company notified or notifies the Agent (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 or General Disclosure
Package relating to the offered Securities; provided, however this sentence shall not apply to
statements or omissions made in reliance upon and in conformity with the Agent Information. 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 or General Disclosure Package 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.
(h) The documents incorporated or deemed to be incorporated by reference in the Registration
Statement, the General Disclosure Package and the Prospectus, at the time they were or hereafter
are filed with the Commission, complied and will comply in all material respects with the
requirements of the Securities Act and the Securities Act Regulations or the Securities Exchange
Act of 1934, as amended (the “Exchange Act”), and the rules and regulations of the Commission under
the Exchange Act (the “Exchange Act Regulations”), as applicable, and, when read together with the
other information in the Prospectus, at the time the Registration Statement became effective, at
the time the Prospectus was issued, at the Applicable Time and at the Closing Times referred to in
Section 5 hereof, 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, in
light of the circumstances under which they were made, not misleading.
(i) Xxxxx Xxxxxxx LLP, the accounting firm that certified the financial statements and
supporting schedules of the Company included in the Registration Statement and the Prospectus is an
independent registered public accounting firm with the Public Company
Accounting Oversight Board as required by the Securities Act, the Securities Act Regulations,
the Exchange Act and the Exchange Act Regulations. With respect to the Company, Xxxxx Xxxxxxx LLP
is not and has not been in violation of the auditor independence requirements of the Xxxxxxxx-Xxxxx
Act of 2002 (“Xxxxxxxx-Xxxxx Act”) and the related rules and regulations of the Commission.
(j) The consolidated financial statements of the Company, together with the related schedules
and notes, included in the Registration Statement, the General Disclosure Package and the
Prospectus, present fairly the financial condition and results of operations of the
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Company and its
consolidated subsidiaries (including Park View Federal Savings Bank (the “Bank”)) at the dates
indicated and the periods specified on its balance sheet, income statement, statement of
shareholders’ equity and statement of cash flows. The financial statements comply in all material
respects with the applicable accounting requirements of Title 12 of the Code of Federal
Regulations, Regulation S-X and accounting principles generally accepted in the United States of
America (“GAAP”) applied on a consistent basis during the periods presented, and present fairly in
all material respects the information required to be stated therein. The other financial,
statistical and pro forma information and related notes included in the Registration Statement, the
General Disclosure Package and the Prospectus present fairly the information shown therein and have
been compiled on a basis consistent with that of the audited financial statements included or
incorporated by reference in the Registration Statement, General Disclosure Package and the
Prospectus. No other financial statements or supporting schedules are required to be included in
the Registration Statement or the Prospectus. To the extent applicable, all disclosures contained
in the Registration Statement, the General Disclosure Package or the Prospectus regarding “non-GAAP
financial measures” (as such term is defined by the rules and regulations of the Commission) comply
with Regulation G of the Exchange Act, the Exchange Act Regulations and Item 10 of Regulation S-K
of the Securities Act Regulations.
(k) Since the respective dates as of which information is given in the Registration Statement,
the General Disclosure Package and the Prospectus, and except as described in or specifically
contemplated by the Prospectus and the General Disclosure Package: (i) the Company and its
subsidiaries (including the Bank) have not incurred any material liabilities or obligations,
indirect, direct or contingent, or entered into any material verbal or written agreement or other
transaction whether or not arising in the ordinary course of business or that could result in a
material reduction in the future earnings of the Company and its subsidiaries (including the Bank)
(taken as a whole); (ii) there has not been any material increase in the long-term debt of the
Company and its subsidiaries (including the Bank) (taken as a whole) or in the aggregate dollar or
principal amount of the Company’s and its subsidiaries (including the Bank) (taken as a whole)
assets that are classified as substandard, doubtful or loss or loans that are 90 days or more past
due or real estate acquired by foreclosure; (iii) there has not been any condition, event, change
or occurrence that has or may reasonably be expected to have a material adverse effect on the
condition (financial or otherwise), business, assets, liabilities, prospects or operations of
Company and its subsidiaries (including the Bank) on a consolidated basis (a “Material Adverse
Effect”) on the aggregate dollar amount of the Company’s and its subsidiaries’ (including the Bank)
(taken as a whole) deposits or their consolidated net worth or spread; (iv) there has been no
material adverse change in the Company’s and its subsidiaries’ (including the Bank) relationship
with its insurance carriers, including, without limitation, cancellation or other termination of
the Company’s or its
subsidiaries’ (including the Bank) fidelity bond or any other type of insurance coverage; (v)
there has been no material change in management of the Company or its subsidiaries (including the
Bank); (vi) the Company and its subsidiaries (including the Bank) have not sustained any material
loss or interference with their respective business or properties from fire, flood, windstorm,
earthquake, accident or other calamity, whether or not covered by insurance; (vii) the Company has
not paid or declared any dividends or other distributions with respect to its capital stock and the
Company and its subsidiaries (including the Bank) are not in default in the payment of principal or
interest on any outstanding debt obligations; and (viii) there has not been any change in the
capital stock of the Company or its subsidiaries (including the Bank).
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(l) The Company is a registered savings and loan holding company under the Home Owners’ Loan
Act, as amended (“HOLA”), has been duly organized and is validly existing as a corporation in good
standing under the laws of the State of Ohio, with the corporate power and authority to own its
properties and to conduct its business as described in the General Disclosure Package and the
Prospectus, and is qualified to transact business and is in good standing in each jurisdiction in
which the conduct of business requires such qualification unless the failure to qualify in one or
more of such jurisdictions would not have a Material Adverse Effect. The Company and the Bank have
obtained all licenses, permits and other governmental authorizations required for the conduct of
each of their respective businesses, except those that individually or in the aggregate would not
have a Material Adverse Effect; and all such licenses, permits and governmental authorizations are
in full force and effect, and the Company is in compliance therewith in all material respects.
(m) Each direct or indirect subsidiary of the Company, other than the Bank, has been duly
organized and is validly existing in good standing under the laws of the jurisdiction of its
incorporation or organization, has corporate power and authority to own, lease and operate its
properties and to conduct its business as described in the General Disclosure Package and the
Prospectus and is duly qualified as a foreign corporation to transact business and is in good
standing in each jurisdiction in which such qualification is required, except where the failure so
to qualify or to be in good standing (singly or in the aggregate) would not result in a Material
Adverse Effect. The Bank is a duly organized and validly existing federally-chartered stock
savings bank chartered under the laws of the United States. All of the issued and outstanding
capital stock of each such subsidiary has been duly authorized and validly issued, is fully paid
and non-assessable and is owned by the Company, directly or through subsidiaries (including the
Bank), free and clear of any security interest, mortgage, pledge, lien, encumbrance, claim or
equity; none of the outstanding shares of capital stock of the Company or any subsidiary was issued
in violation of the preemptive or similar rights of any securityholder of such subsidiary. The
only subsidiaries of the Company are the subsidiaries listed on Exhibit 21 to the Registration
Statement.
(n) The deposit accounts of the Bank are insured by the FDIC to the legal maximum, and the
Bank has paid all premiums and assessments required by the FDIC and the regulations thereunder and
no proceeding for the termination or revocation of such insurance is pending or, to the Company’s
knowledge, threatened. The Bank is a member of the Federal Home Loan Bank of Cincinnati.
(o) The Securities have been duly authorized for issuance and sale as provided herein and as
described in the General Disclosure Package and the Prospectus, the Company has a duly authorized
and outstanding capitalization as set forth under “Capitalization” in the General Disclosure
Package and the Prospectus, and all the issued and outstanding shares of capital stock are, and the
Securities when issued, delivered and paid for as described in the General Disclosure Package and
the Prospectus will be, validly issued and outstanding, fully paid and nonassessable with no
personal liability attaching to the ownership of them; the issuance of the Securities is not
subject to preemptive or other similar rights; and the terms and provisions of the Securities will
conform in all material respects to the description thereof contained in the General Disclosure
Package and the Prospectus. Upon issuance of the Securities sold, good title to the Securities
will be transferred from the Company to the purchasers of Common Stock against payment
10
therefor as
set forth in the General Disclosure Package and Prospectus and any applicable certificates used to
evidence the Securities will be in due and proper form.
(p) Except as set forth in the General Disclosure Package and the Prospectus, neither the
Company nor any of its subsidiaries (including the Bank) is in violation of their respective
articles of incorporation or charter or their respective bylaws, or in material breach or default
in the performance or observance of any obligation, agreement, covenant, or condition contained in
any agreement, judgment, decree, order, mortgage, deed of trust, lease, franchise, license,
indenture, permit or other instrument to which the Company or any subsidiary (including the Bank)
is a party or by which they, or any of their respective property, may be bound (collectively,
“Agreements and Instruments”) that would result in a Material Adverse Effect and there does not
exist any state of facts that constitutes an event of default on the part of the Company or any of
its subsidiaries (including the Bank) as defined in the Agreements and Instruments or that, with
notice or lapse of time or both, would constitute such an event of default that individually or in
the aggregate would result in a Material Adverse Effect. The execution, delivery and performance
of this Agreement, the Subscription Agent Agreement, the Escrow Agreement and the consummation of
the transactions contemplated by this Agreement, the Subscription Agent Agreement, the Escrow
Agreement and in the Registration Statement (including, without limitation, the distribution of the
Rights and the allotment, issuance and sale of the Securities and the use of the proceeds from the
sale of the Securities as described in the General Disclosure Package and Prospectus under the
caption “Use of Proceeds”) and compliance by the Company and the Bank, as applicable, with their
respective obligations hereunder and thereunder have been duly authorized by all necessary
corporate action and do not and will not, whether with or without the giving of notice or passage
of time or both, conflict with or constitute a breach of, or default or Repayment Event (as defined
below) under, or result in the creation or imposition of any lien, charge or encumbrance upon any
property or assets of the Company or any subsidiary (including the Bank) pursuant to the Agreements
and Instruments (except for such conflicts, breaches or defaults, Repayment Events, or liens,
charges or encumbrances that would not result in a Material Adverse Effect), nor will such action
result in any violation of the provisions of the articles of incorporation or charter or bylaws of
the Company or any subsidiary (including the Bank) or any applicable law, statute, rule,
regulation, judgment, order, writ or decree of any government, government instrumentality or court,
domestic or foreign, having jurisdiction over the Company or any subsidiary (including the Bank) or
any of their assets, properties or operations except for violations that would not, individually or
in the aggregate, result in a Material Adverse Effect. As used herein, a “Repayment Event” means
any event or condition that gives the holder of any note, debenture
or other evidence of indebtedness (or any person acting on such holder’s behalf) the right to
require the repurchase, redemption or repayment of all or a portion of such indebtedness by the
Company or any subsidiary (including the Bank).
(q) Except as disclosed in the General Disclosure Package and the Prospectus, no enforcement
proceeding, whether formal or informal, has been commenced against the Company or any of its
subsidiaries (including the Bank) by the Office of Thrift Supervision (“OTS”) or FDIC or, to the
Company’s and its subsidiaries’ (including the Bank) knowledge any other governmental authority,
nor have any such proceedings been instituted, or threatened or recommended. Except as disclosed
in the General Disclosure Package and the Prospectus, the Company and its subsidiaries (including
the Bank) are not in violation of any directive from the
11
OTS, the FDIC, or any other agency that
has directed the Company or any of its subsidiaries (including the Bank) to make any material
change in the method of conducting their respective businesses; the Company and its subsidiaries
(including the Bank) have conducted and are conducting their respective businesses so as to comply
in all material respects with all applicable statutes and regulations (including, without
limitation, regulations, decisions, directives and orders of the OTS, the Commission and the FDIC
(including the Order to Cease and Desist dated October 19, 2009 issued against the Company and the
Order to Cease and Desist, dated October 19, 2009 issued against the Bank)), and there is no legal
or regulatory action, injunction, judgment, decree or order of any court, regulatory body,
administrative agency or other governmental body pending or, to the Company’s knowledge, threatened
to which the Company or any of its subsidiaries (including the Bank) is or may be a party or of
which property owned or leased by the Company or any of its subsidiaries (including the Bank) is or
may be the subject, or related to environmental, discrimination or financial regulatory matters,
which actions, suits or proceedings might, individually or in the aggregate, prevent or adversely
affect the transactions contemplated by this Agreement or are likely to result in a Material
Adverse Effect.
(r) No labor dispute with the employees of the Company or any subsidiary (including the Bank)
exists or, to the knowledge of the Company and the Bank, is imminent, and the Company is not aware
of any existing or imminent labor disturbance by the employees of any of the Company or any of its
subsidiaries (including the Bank) principal suppliers, manufacturers, customers or contractors,
which, in either case, may reasonably be expected to result in a Material Adverse Effect.
(s) The Company has or its subsidiaries (including the Bank) have good and marketable title to
all their properties and assets, free and clear of all liens, charges, encumbrances or
restrictions, except such as do not materially adversely affect the value of such properties and
assets and do not interfere with the use made or proposed to be made of such properties and assets
by the Company and its subsidiaries (including the Bank); all of the leases and subleases material
to the business of the Company or its subsidiaries (including the Bank) or under which the Company
and its subsidiaries (including the Bank) hold properties described in the General Disclosure
Package and the Prospectus are in full force and effect; and the Company has or its subsidiaries
(including the Bank) have no notice of any material claim of any sort that has been asserted by
anyone adverse to the rights of the Company or its subsidiaries (including the Bank) as owner or as
lessee or sublessee under any of the leases or subleases mentioned above, or materially affecting
or questioning the rights of the Company or its subsidiaries (including the Bank) to the continued
possession of the leased or subleased premises under any
such lease or sublease. Except as disclosed in the General Disclosure Package and the
Prospectus and other than such leases and properties as are immaterial in the aggregate, the
Company or its subsidiaries (including the Bank) owns or leases all such properties as are
necessary to its operations as now conducted or as proposed to be conducted.
(t) The Company and its subsidiaries (including the Bank) have sufficient trademarks, trade
names, patent rights, copyrights, licenses, approvals and governmental authorizations to conduct
their businesses as now conducted; the expiration of any trademarks, trade names, patent rights,
copyrights, licenses, approvals or governmental authorizations would not, individually or in the
aggregate, have a Material Adverse Effect; and the Company and its subsidiaries (including the
Bank) have no knowledge of any material infringement by them of
12
trademarks, trade names, patent
rights, copyrights, licenses, trade secrets or other similar rights of others, and, to the
Company’s and its subsidiaries’ (including the Bank) knowledge, there is no claim being made
against the Company or any of its subsidiaries (including the Bank) regarding trademark, trade
name, patent, copyright, license, trade secret or other infringement that could, individually or in
the aggregate, have a Material Adverse Effect.
(u) The Company and the Bank have timely filed or requested an extension of all required
federal, state and local tax returns, have paid all taxes that have become due and payable in
respect of such returns, except where permitted to be extended, have made adequate reserves for
similar future tax liabilities, and no deficiency has been asserted with respect thereto by any
taxing authority.
(v) The statistical and market related data contained in the General Disclosure Package, the
Prospectus and the Registration Statement are based on or derived from sources that the Company
believes are reliable and accurate.
(w) The Company and each of its subsidiaries (including the Bank) maintains a system of
internal accounting controls sufficient to provide reasonable assurances that (i) transactions are
executed in accordance with management’s general or specific authorization, (ii) transactions are
recorded as necessary to permit preparation of financial statements in conformity with GAAP and to
maintain accountability for assets, (iii) access to assets is permitted only in accordance with
management’s general or specific authorization and (iv) the recorded accountability for assets is
compared with existing assets at reasonable intervals and appropriate action is taken with respect
to any differences.
(x) The Company and its subsidiaries (including the Bank) maintain disclosure controls and
procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) and
internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f)
under the Exchange Act). Since the end of the Company’s most recent audited fiscal year, the
Company’s independent registered public accounting firm and the Audit Committee of the Board of
Directors have not been advised of: (i) any significant deficiencies or material weaknesses in the
design or operation of internal control over financial reporting that are reasonably likely to
adversely affect the Company’s ability to record, process, summarize, and report financial data;
(ii) any fraud, whether or not material, that involves management or other employees who have a
significant role in the Company’s internal control over financial reporting; or any (iii) change in
the Company’s internal control over financial
reporting that has materially affected, or is reasonably likely to materially affect, the
Company’s internal control over financial reporting.
(y) The Registration Statement is not the subject of a pending proceeding or examination under
Section 8(d) and 8(e) of the Securities Act, and the Company is not the subject of a pending
proceeding under Section 8A of the Securities Act.
(z) Except for the consents required by the OTS and FINRA, which have been or will be
obtained, no approval, authorization, consent or other order of any regulatory or supervisory or
other public authority is required for the execution, delivery and performance of this Agreement,
the Subscription Agent Agreement or the Escrow Agreement by the Company,
13
the consummation by the
Company of the transactions contemplated by this Agreement, by the Subscription Agent Agreement, or
the Escrow Agreement, including, without limitation, the distribution of the Rights and the
allotment, issue and sale of the Common Stock, except those that have been obtained and those that
may be required under the Securities Act, the Securities Act Regulations or under state securities
laws or Blue Sky laws of the various states in which the Securities are to be offered.
(aa) Other than as disclosed in the General Disclosure Package and the Prospectus, the Company
has not: (i) issued any securities within the last 18 months (except for notes to evidence bank
loans or other liabilities in the ordinary course of business); (ii) had any dealings with respect
to sales of securities within the 12 months prior to the date hereof with any other member of
FINRA, or any person related to or associated with another member, other than discussions and
meetings relating to the Stock Offering and purchases and sales of United States government and
agency and other securities in the ordinary course of business; (iii) engaged any intermediary
between the Agent and the Company in connection with the Stock Offering, and no person is being
compensated in any manner for such services; or (iv) entered into a financial or management
consulting agreement except for the Letter Agreement and as contemplated hereunder.
(bb) There are no material contracts or other documents that are required to be described in
the General Disclosure Package and the Prospectus or filed as exhibits to the Registration
Statement by the Securities Act or by the Securities Act Regulations that have not been described
in the General Disclosure Package and the Prospectus and filed as exhibits to the Registration
Statement or incorporated in the Registration Statement by reference as permitted by the Securities
Act Regulations; the contracts so described in the General Disclosure Package and the Prospectus
are in full force and effect on the date hereof; the descriptions thereof or references thereto are
correct in all material respects; and neither the Company nor any of its subsidiaries (including
the Bank), nor, to the knowledge of the Company, any other party is in breach of or default under
any of such contracts.
(cc) Neither the Company nor any of its subsidiaries (including the Bank) nor, to the
knowledge of the Company, any director, officer, agent, employee or other person associated with or
acting on behalf of the Company or any of its subsidiaries (including the Bank) has (i) used any
corporate funds for any unlawful contribution, gift, entertainment or other unlawful expense
relating to political activity; (ii) made any direct or indirect unlawful payment to any foreign or
domestic government official or employee from corporate funds; (iii) violated
or is in violation of any provision of the Foreign Corrupt Practices Act of 1977; or (iv) made
any bribe, rebate, payoff, influence payment, kickback or other unlawful payment.
(dd) The Company is in compliance with the applicable provisions of the Xxxxxxxx-Xxxxx Act,
the rules and regulations of the Commission thereunder, and the corporate governance and other
rules and requirements of the Nasdaq Capital Market and will comply in all material respects with
any such provisions that will become effective in the future upon their effectiveness. The Bank
complies in all material respects with the applicable financial record keeping and reporting
requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended, and the
regulations and rules thereunder.
14
(ee) The Company has not relied upon Agent or its counsel for any legal, tax or accounting
advice in connection with the Stock Offering.
(ff) The Company and its subsidiaries (including the Bank) comply in all material respects
with all laws, rules and regulations relating to environmental protection, and none of them has
been notified or is otherwise aware that any of them is potentially liable, or is considered
potentially liable, under the Comprehensive Environmental Response, Compensation and Liability Act
of 1980, as amended, or any other Federal, state or local environmental laws and regulations; no
action, suit, regulatory investigation or other proceeding is pending, or to the knowledge of the
Company, threatened against the Company relating to environmental protection, nor does the Company
or its subsidiaries (including the Bank) have any reason to believe any such proceedings may be
brought against any of them; and no disposal, release or discharge of hazardous or toxic
substances, pollutants or contaminants, including petroleum and gas products, as any of such terms
may be defined under federal, state or local law, has occurred on, in, at or about any facilities
or properties owned or leased by the Company or its subsidiaries (including the Bank) or in which
the Company or its subsidiaries (including the Bank) have a security interest, unless such
disposal, release or discharge would not have a Material Adverse Effect.
(gg) The Company and each of it subsidiaries (including the Bank) or their “ERISA Affiliates”
(as defined below) 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 “employee benefit plan” (as defined in ERISA) for which
the Company or any of it subsidiaries (including the Bank) or ERISA Affiliates would have any
liability; the Company and each of its subsidiaries (including the Bank) or their ERISA Affiliates
have not incurred and do not expect to incur liability under (A) Title IV of ERISA with respect to
termination of, or withdrawal from, any “employee benefit plan” or (B) Sections 412, 4971, 4975 or
4980B of the United States Internal Revenue Code of 1986, as amended, and the regulations and
published interpretations thereunder (collectively the “Code”); and each “employee benefit plan”
for which the Company and each of its subsidiaries (including the Bank) or any of their ERISA
Affiliates 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 as occurred, whether by action or by
failure to act, which would cause the loss of such qualification. “ERISA Affiliate” means, with
respect to the Company or a subsidiary (including the Bank), any member of any group of
organizations described in Sections
414(b), (c), (m) or (o) of the Code or Section 400(b) of ERISA of which the Company or such
subsidiary (including the Bank) is a member.
(hh) All of the loans represented as assets on the most recent financial statements or
selected financial information of the Bank and the Company included in the General Disclosure
Package or the Prospectus comply with or are exempt from all requirements of federal, state and
local law pertaining to lending, including, without limitation, truth in lending (including the
requirements of Regulations Z and 12 C.F.R. Part 226), 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.
15
(ii) The Company and its subsidiaries (including the Bank) maintain insurance of the type and
in the amount generally deemed adequate for their respective businesses, including, but not limited
to, general liability insurance, fidelity bond insurance and insurance covering real and personal
property owned or leased by the Company or its subsidiaries (including the Bank) against theft,
forgery, damage, destruction, acts of vandalism and all other risks customarily insured against,
all of which insurance is in full force and effect.
(jj) The Company is not, and upon the issuance and sale of the Securities as herein
contemplated and the application of the net proceeds therefrom as described in the General
Disclosure Package and the Prospectus will not be, an “investment company” or an entity
“controlled” by an “investment company” as such terms are defined in the Investment Company Act of
1940, as amended.
(kk) The Company has not distributed and, prior to the later to occur of (i) the Closing Times
and (ii) completion of the distribution of the Securities, will not distribute any prospectus (as
such term is defined in the Securities Act and the Securities Act Regulations) in connection with
the offering and sale of the Securities other than the Registration Statement, any preliminary
prospectus, the Prospectus, any free writing prospectus or any prospectus supplement, if any,
permitted by the Securities Act or by the Securities Act Regulations and approved by the Agent.
(ll) Neither the Company nor any of its subsidiaries (including the Bank) has participated in
any reportable transaction, as defined in 26 C.F.R. § 1.6011-4 (b)(1).
(mm) Any and all material swaps, caps, floors, futures, forward contracts, option agreements
(other than employee stock options) and other derivative financial instruments, contracts or
arrangements, whether entered into for the account of the Company or one of its subsidiaries
(including the Bank) or for the account of a customer of the Company or one of its subsidiaries
(including the Bank), were entered into in the ordinary course of business and in accordance with
prudent business practice and applicable laws, rules, regulations and policies of all applicable
regulatory agencies and with counterparties believed to be financially responsible at the time.
The Company and each of its subsidiaries (including the Bank) have duly performed all of their
obligations thereunder to the extent that such obligations to perform have accrued, and there are
no breaches, violations or defaults or allegations or assertions of such by any party
thereunder, except for such breaches, violations, defaults, allegations or assertions that,
individually or in the aggregate, would not result in a Material Adverse Effect.
(nn) Other than as contemplated by this Agreement, there is no broker, finder or other party
that is entitled to receive from the Company or any subsidiary (including the Bank) any brokerage
or finder’s fee or any other fee, commission or payment as a result of the transactions
contemplated by this Agreement.
(oo) No relationship, direct or indirect, exists between or among the Company or any of its
subsidiaries (including the Bank), on the one hand, and the directors, officers, shareholders,
customers or suppliers of the Company or any of its subsidiaries (including the Bank), on the
other, that is required by the Securities Act or by Securities Act Regulations to be
16
described in
the Registration Statement and/or the General Disclosure Package and the Prospectus and that is not
so described.
Any certificates signed by an officer of the Company and delivered to the Agent or its counsel
that refer to this Agreement shall be deemed to be a representation and warranty by the Company to
the Agent as to the matters covered thereby with the same effect as if such representation and
warranty were set forth herein. Any certificate delivered by the Company to its counsel for
purposes of enabling such counsel to render the opinions referred to in Section 9(b)(i) will also
be furnished to the Agent and its counsel and shall be deemed to be additional representations and
warranties by the Company to the Agent as to the matters covered thereby and the Agent and its
counsel are entitled to rely thereon.
Section 7. Covenants of the Company The Company hereby covenants with the Agent as
follows:
(a) The Company will not, at any time after the date the Registration Statement is declared
effective, file any amendment or supplement to the Registration Statement (including any
Issuer-Represented Free Writing Prospectus, Issuer-Represented General Free Writing Prospectus or
Issuer-Represented Limited-Use Free Writing Prospectus) without providing Agent and its counsel an
opportunity to review and comment on such amendment or file any amendment or supplement to which
amendment the Agent or its counsel shall reasonably object. The Company will furnish promptly to
the Agent and its counsel copies of all correspondence from the Commission with respect to the
Registration Statement, including the documents incorporated therein, and the Company’s responses
thereto.
(b) The Company represents and agrees that, unless it obtains the prior consent of Agent, and
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 Shares 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 Agent is hereinafter referred to as a “Permitted
Free Writing Prospectus.” The Company represents that it has complied 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 Securities Act without
regard to Rule 172 or 173 of the Securities Act Regulations.
(c) The Company, subject to Section 7(a), will comply with the requirements of Rule 430A of
the Securities Act Regulations and will notify the Agent immediately, and confirm the notice in
writing, (i) when any post-effective amendment to the Registration Statement shall become
effective, or any supplement to the Prospectus or any amended Prospectus shall have been filed,
(ii) of the receipt of any comments from the Commission, (iii) of any request by the Commission for
any amendment to the Registration Statement or any amendment or supplement to the Prospectus or for
additional information, and (iv) of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or of any order preventing or suspending the use of any
preliminary prospectus, or of
17
the suspension of the qualification of the Securities for offering or
sale in any jurisdiction, or of the initiation or threatening of any proceedings for any of such
purposes or of any examination pursuant to Section 8(e) of the Securities Act concerning the
Registration Statement and (v) if the Company becomes the subject of a proceeding under Section 8A
of the Securities Act in connection with the offering of the Securities. The Company will promptly
effect the filings necessary pursuant to Rule 424(b) in the manner and within the time period
required by Rule 424(b) (without reliance on Rule 424(b)(8)) and will take such steps as it deems
necessary to ascertain promptly whether the form of prospectus transmitted for filing under Rule
424(b) was received for filing by the Commission and, in the event that it was not, it will
promptly file such prospectus. The Company 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.
(d) The Company will deliver to the Agent, as soon as the Registration Statement becomes
effective and thereafter when the Prospectus is required to be delivered under the Securities Act,
as many copies of the Prospectus and as many conformed copies of the Registration Statement
originally filed and of each amendment to the Registration Statement (including exhibits filed with
the Registration Statement or incorporated by reference in the Registration Statement) as the Agent
may reasonably request. The copies of the Registration Statement and each amendment thereto
furnished to the Agent will be identical to the electronically transmitted copies thereof filed
with the Commission pursuant to XXXXX, except to the extent permitted by Regulation S-T.
(e) The Company has delivered to the Agent, without charge, as many copies of each preliminary
prospectus as the Agent reasonably requested, and the Company hereby consents to the use of such
copies for purposes permitted by the Securities Act. The Company will furnish to the Agent,
without charge, during the period when the Prospectus is required to be delivered under the
Securities Act or the Exchange Act, such number of copies of the Prospectus (as amended or
supplemented) as the Agent may reasonably request. The Prospectus and any amendments or
supplements thereto furnished to the Agent will be identical to the electronically transmitted
copies thereof filed with the Commission pursuant to XXXXX, except to the extent permitted by
Regulation S-T.
(f) The Company will comply with terms, conditions, requirements and provisions with respect
to any agreement entered into by the Company and the Standby Purchaser.
(g) The Company will comply with the Securities Act and the Securities Act Regulations so as
to permit the completion of the distribution of the Securities as contemplated in this Agreement
and in the Prospectus. If at any time when a prospectus is required by the Securities Act to be
delivered in connection with sales of the Securities, any event shall occur or condition shall
exist as a result of which it is necessary, in the opinion of counsel for the Agent or for the
Company, to amend the Registration Statement or amend or supplement the Prospectus in order that
the Prospectus will not include any untrue statements of a material fact or omit to state a
material fact necessary in order to make the statements therein not misleading in the light of the
circumstances existing at the time it is delivered to a purchaser, or if it shall be necessary, in
the opinion of such counsel, at any such time to amend the Registration Statement or amend or
supplement the Prospectus in order to comply with the requirements of the Securities Act or the
18
Securities Act Regulations, the Company will promptly prepare and file with the Commission, subject
to Section 9(a), such amendment or supplement as may be necessary to correct such statement or
omission or to make the Registration Statement or the Prospectus comply with such requirements, and
the Company will furnish to the Agent such number of copies of such amendment or supplement as the
Agent may reasonably request.
(h) The Company will use its best efforts, in cooperation with the Agent, to qualify the
Securities for offering and sale under the applicable securities laws of such states and other
jurisdictions (domestic or foreign) as the Agent may designate and to maintain such qualifications
in effect for a period of not less than one year from the effective date of the Registration
Statement; provided, however, that the Company shall not be obligated to file any general consent
to service of process or to qualify as a foreign corporation or as a dealer in securities in any
jurisdiction in which it is not so qualified or to subject itself to taxation in respect of doing
business in any jurisdiction in which it is not otherwise so subject. In each jurisdiction in
which the Securities have been so qualified, the Company 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. The
Company will also supply the Agent with such information as is necessary for the determination of
the legality of the Securities for investment under the laws of such jurisdiction as the Agent may
request.
(i) The Company will refrain during a period of 180 days after the consummation of all sales
of Common Stock in the Stock Offering (such 180 day period being referred to herein as the “Lock-Up
Period”), without the prior written consent of the Agent, from (i) offering, pledging, selling,
contracting to sell, or selling any option, warrant, or contract to purchase, purchasing any
option, warrant, or contract to sell, granting any option for the sale of, or otherwise disposing
of or transferring, directly or indirectly, any Common Stock or any securities convertible into or
exercisable or exchangeable for Common Stock, or filing any registration statement under the
Securities Act with respect to any of the foregoing or (ii) entering into any swap or any other
agreement or transaction that transfers, in whole or in part, directly or indirectly, the economic
consequence of ownership of the Common Stock or any security convertible into or exchangeable for
Common Stock, whether any such swap or
transaction described in clause (i) or (ii) above is to be settled by delivery of Common Stock
or such other securities, in cash or otherwise. The Company shall also cause the Standby
Purchaser, executive officer and director and five percent (5.0%) or greater shareholder and
certain other shareholders of the Company to furnish to the Agent, on or prior to the date hereof,
a letter or letters, in form and substance satisfactory to counsel for the Agent, pursuant to which
each such person or entity shall agree to abide by the aforementioned restrictions, unless they
have received prior written consent from the Agent, for a period of 180 days from the date of the
Prospectus. The foregoing sentence shall not apply to (y) any shares of Common Stock issued by the
Company upon the exercise of an option outstanding on the date hereof and referred to in the
Prospectus; or (z) any shares of Common Stock or any securities convertible into or exercisable or
exchangeable for Common Stock issued in connection with a merger, acquisition of another entity,
acquisition of assets or any other similar transaction. Notwithstanding the foregoing, if (i)
during the last 17 days of the initial Lock-Up Period, the Company releases earnings results or
material news or a material event relating to the Company occurs or (ii) prior to the expiration of
the initial Lock-Up Period, the Company announces that it will release earnings
19
results during the
16-day period beginning on the last day of the initial Lock-Up Period, then in each case the
Lock-Up Period will be automatically extended until the expiration of the 18-day period beginning
on the date of release of the earnings results or the occurrence of the material news or material
event, as applicable, unless the Agent waives, in writing, such extension.
(j) For the period of three years from the date of this Agreement, the Company will furnish to
Agent upon request (i) a copy of each report of the Company 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 or quoted, (ii) a copy of each report of the Company mailed
to holders of Common Stock or non-confidential report filed with the Commission, the FDIC, the OTS,
the Board of Governors of the Federal Reserve System (the “FRB”) or any other supervisory or
regulatory authority or any national securities exchange or system on which any class of the
securities of the Company is listed or quoted, (iii) each press release and material news item and
article released by the Company and/or Bank, and (iv) from time-to-time, such other publicly
available information concerning the Company as Agent may reasonably request.
(k) The Company will use the net proceeds from the sale of the Common Stock in the manner set
forth in the Prospectus under the caption “Use of Proceeds.”
(l) The Company will distribute the Prospectus or other offering materials (including any
Permitted Free Writing Prospectus) in connection with the offering and sale of the Common Stock
only in accordance with the Securities Act and the Securities Act Regulations, and the laws of any
state in which the shares are qualified for sale.
(m) During the time when a prospectus is required to be delivered under the Securities Act,
the Company shall at all times comply, in all material respects, with all applicable provisions of
the Xxxxxxxx-Xxxxx Act, including the related rules and regulations promulgated thereunder by the
Commission and the Nasdaq Capital Market, in effect from time to time.
(n) The Company will timely file an “Additional Listing Application” with the Nasdaq Capital
Market in connection with the Securities. The Company will use its best efforts
to obtain, effect and maintain the listing of the Securities on the Nasdaq Capital Market and
will file with the Nasdaq Capital Market all documents and notices required by the Nasdaq Capital
Market of companies that have securities that are listed on the Nasdaq Capital Market.
(o) For so long as the Common Stock is registered under the Exchange Act, the Company will
furnish to its stockholders after the end of each fiscal year, in the time periods prescribed by
applicable law and regulations, such reports and other information as are required to be furnished
to its stockholders under the Exchange Act (including consolidated financial statements of the
Company and its subsidiaries (including the Bank), certified by independent public accountants).
(p) The Company and the Bank will conduct their businesses 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 FDIC and the OTS.
20
(q) The Company and the Bank shall comply with any and all terms, conditions, requirements and
provisions imposed by the FDIC, the OTS, the FRB, the HOLA, the Commission, the Securities Act, the
Securities Act Regulations, the Exchange Act and the Exchange Act Regulations. The Company will
comply with all provisions of all undertakings contained in the Registration Statement.
(r) The Company will promptly advise the Agent upon receipt of any material correspondence by
it or any subsidiary (including the Bank) or the commencement of any enforcement action against it
or any subsidiary (including the Bank) (formal or otherwise) from or by the FDIC, the OTS, the FRB,
the HOLA or any other regulator.
(s) The Company agrees to use its best efforts to furnish, or cause to be furnished, to the
Agent, lists, or copies of those lists, showing the names and addresses of, and number of shares of
Common Stock held by, Record Date Shareholders as of the Record Date, and to the extent available
to the Company, similar information regarding any beneficial owners of the Company’s Common Stock
for whom such Record Date Shareholders act as nominees.
(t) The Company will arrange for the Subscription Agent to, inform the Agent, on each
Business Day during the Subscription Period (to be followed by written confirmation), as to the
name, phone number, shareholder status and amount of Common Stock held by any individual who calls
the Company or the Subscription Agent, and the number of Rights that have been exercised since its
previous daily report to the Agent under the provision of this Section 7(t) including the name of
the Rights Holder and the amount of Common Stock subscribed for, and, not later than 10:00 a.m.,
Eastern Time, on the first Business Day after the Expiration Date, use its best efforts to provide
the Agent with a written statement as to the total number of Rights exercised (separately setting
forth the number of Rights exercised by Record Date Shareholders).
(u) The Company shall provide the Agent with any other information necessary to allow the
Agent to manage the allocation process in order to permit the Company to
carry out the allocation of the Common Stock in the event of an over-subscription, and all
such information shall be accurate and reliable in all material respects.
(v) The Company will not deliver the Common Stock until the Company has satisfied or caused to
be satisfied each condition set forth in Section 9 hereof, unless such condition is waived in
writing by the Agent.
(w) Each of the Company’s executive officers and directors and the Standby Purchaser, in each
case as listed on Schedule A hereto, will execute and deliver lock-up agreements as
contemplated by Section 9(k) hereof.
Section 8. Payment of Expenses
Whether or not the Stock Offering is completed or the sale of the Securities by the Company is
consummated, the Company and Bank will pay for all their own expenses incident to the performance
of this Agreement, including without limitation: (a) the preparation and filing of any applicable
regulatory applications; (b) the preparation, printing, filing, delivery and mailing of the
Registration Statement, including the Prospectus and any applicable Proxy
21
Statement, and all
documents related to the Stock Offering; (c) all filing fees and expenses in connection with the
qualification or registration of the Securities for offer and sale by the Company or the Bank under
the securities or “Blue Sky” laws, including without limitation filing fees, reasonable legal fees
and disbursements of counsel in connection therewith, and in connection with the preparation of a
blue sky law survey; (d) the filing fees with FINRA related to the Agent’s fairness filing under
FINRA Rule 5110; (e) fees and expenses related to auditing and accounting services; (f) all
expenses relating to advertising, temporary personnel, investor meetings and stock information
center; (g) all expenses relating to obtaining necessary Shareholder Approvals; (h) subscription
agent and transfer agent fees and costs of preparation and distribution of stock certificates; and
(i) fees payable under the Escrow Agreement. The Company also agrees to reimburse Agent for
reasonable out-of-pocket expenses, including legal fees and expenses, incurred by Agent in
connection with the services hereunder; provided, however, that the Company shall not owe the Agent
more than $175,000 in connection with the Agent’s out-of-pocket legal fees and expenses (excluding
Blue Sky fees and expenses). Not less than two days prior to the Closing Times, the Agent will
provide the Company with a detailed accounting of all reimbursable expenses to be paid at the
Closing.
Section 9. Conditions to the Agent’s Obligations The Company and the Agent agree that
obligations of the Agent hereunder are subject to the accuracy of the representations and
warranties of the Company contained herein as of the date hereof and the Closing Times, to the
accuracy of the statements of officers and directors of the Company and its subsidiaries (including
the Bank) made pursuant to the provisions hereof, to the performance by the Company and its
subsidiaries (including the Bank) of their obligations hereunder, and to the following further
conditions:
(a) The Registration Statement shall have become effective and at or before the date of this
Agreement, no stop order suspending the effectiveness of the Registration Statement shall have been
issued, and prior to that time, no stop order proceeding shall have been
initiated or, to the Company’s knowledge, threatened by the Commission. Any request of the
Commission for inclusion of additional information in the Registration Statement or the Prospectus
or otherwise shall have been complied with to the reasonable satisfaction of the Agent and the
Company. The Company shall not have filed with the Commission the Prospectus or any amendment or
supplement to the Registration Statement or the Prospectus without consent of the Agent, which
consent shall not have been unreasonably withheld or delayed. The Agent shall not have discovered
and disclosed to the Company, on or prior to the date of this Agreement, that the Registration
Statement, the General Disclosure Package or the Prospectus or any amendment or supplement to the
Registration Statement, the General Disclosure Package or the Prospectus contains an untrue
statement of a fact that, in the reasonable opinion of the Agent, is material or omits to state a
fact that, in the reasonable opinion of the Agent, is material and is required to be stated therein
or is necessary to make the statements therein, in light of the circumstances under which they were
made, not misleading.
(b) At each Closing Time, the Agent shall have received:
(i) The favorable opinion, dated as of the applicable Closing Time, of Xxxxxxxxxx
Xxxxxxxx, LLP, acceptable to Agent and in form and substance satisfactory to counsel for
Agent, as set forth in Exhibit A hereto.
22
(ii) The letter of Xxxxxxxxxx Xxxxxxxx LLP in form and substance to the effect that
during the preparation of the Registration Statement, the General Disclosure Package and the
Prospectus, Xxxxxxxxxx Xxxxxxxx LLP participated in conferences with certain officers of and
other representatives of the Company and the Bank, counsel to Agent, representatives of the
independent public accounting firm for the Company and representatives of Agent at which the
contents of the Registration Statement, the General Disclosure Package and the Prospectus
and related matters were discussed and has considered the matters required to be stated
therein and the statements contained therein and, although (without limiting the opinions
provided pursuant to Section 9(b)(i) hereof) Xxxxxxxxxx Xxxxxxxx LLP has not independently
verified the accuracy, completeness or fairness of the statements contained in the
Registration Statement, the General Disclosure Package and Prospectus, on the basis of the
foregoing, nothing has come to the attention of Xxxxxxxxxx Xxxxxxxx LLP that caused
Xxxxxxxxxx Xxxxxxxx LLP to believe that (A) the Registration Statement at the time it was
declared effective by the Commission, (B) the General Disclosure Package as of the time and
date as of which the subscription ratio and subscription price were determined and as of the
date of such letter and (C) the Prospectus, as of its date and as of the date of such
letter, contained or contains any untrue statement of a material fact or omitted to state
any material fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading (it being
understood that counsel need express no comment or opinion with respect to the financial
statements, schedules and other financial data included in the Registration Statement, the
Prospectus or the General Disclosure Package).
(iii) The favorable opinion, dated as of the applicable Closing Time, of Xxxxx Day,
with respect to such matters as the Agent may reasonably require, in form and substance
satisfactory to the Agent.
(c) Concurrently with the execution of this Agreement and on the effective date of any
post-effective amendment to the Registration Statement filed subsequent to the date of this
Agreement, Xxxxx Xxxxxxx LLP shall have furnished to the Agent a letter or letters, dated the
respective dates of delivery thereof, in form and substance satisfactory to the Agent, containing
statements and information of the type ordinarily included in accountants “comfort letters” with
respect to the financial statements of the Company and certain financial information contained in
the Prospectus.
(d) At the applicable Closing Time, Xxxxx Xxxxxxx LLP shall have delivered a letter, dated as
of such Closing Time, to the effect that they reaffirm the statements made in the letter furnished
pursuant to subsection (c) of this Section, except that the specified date referred to shall be a
date not more than three business days prior to the Closing Date.
(e) At the applicable Closing Time, counsel to Agent shall have been furnished with such
documents and opinions as counsel for Agent may reasonably require for the purpose of enabling them
to advise Agent with respect to the issuance and sale of the Common Stock as herein contemplated
and related proceedings, or in order to evidence the accuracy of any of the representations and
warranties, or the fulfillment of any of the conditions herein contained.
23
(f) At the applicable Closing Time, Agent shall receive a certificate of the Chief Executive
Officer and Chief Financial Officer of the Company and the Bank, dated as of such Closing Time,
without personal liability to the effect that: (i) they have examined the Prospectus and at the
time the Prospectus became authorized for final use, the Prospectus did 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 light of the circumstances under which they were made, not misleading; (ii)
there has not been, since the respective dates as of which information is given in the Prospectus,
any material adverse change in the financial condition, results of operation, capital, properties
or business affairs of the Company and the Bank, considered as one enterprise, whether or not
arising in the ordinary course of business; (iii) the representations and warranties contained in
Section 6 of this Agreement are true and correct with the same force and effect as though made at
and as of the Closing Times; (iv) the Company has complied in all material respects with all
material agreements and satisfied all conditions on its part to be performed or satisfied at or
prior to the Closing Times including the conditions contained in this Section 9; and (v) no stop
order has been issued or, to their knowledge, is threatened, by the Commission or any other
governmental body.
(g) The Company shall not have sustained, since the date of the latest financial statements
included in the Registration Statement, the General Disclosure Package and the Prospectus, any
material loss or interference with its business from fire, explosion, flood or other calamity,
whether or not covered by insurance, or from any labor dispute or court or governmental action,
order or decree, otherwise than as set forth in the Registration Statement and the Prospectus, and
since the respective dates as of which information is given in the Registration Statement and the
Prospectus, there shall not have been any material change, or any development involving a
prospective material change in, or affecting the general affairs of, management, financial
position, retained earnings, long-term debt, shareholders’ equity or results of operations of the
Company, otherwise than as set forth or contemplated in the Registration
Statement and the Prospectus, the effect of which, in any such case described above, is in
Agent’s reasonable judgment sufficiently material and adverse as to make it impracticable or
inadvisable to proceed with the Stock Offering on the terms and in the manner contemplated in the
Prospectus.
(h) Prior to and at the applicable Closing Time: (i) in the reasonable opinion of Agent there
shall have been no material adverse change in the financial condition or in the earnings,
operations, capital, properties or business affairs of the Company and the Bank, considered as one
enterprise, from and as of the latest dates as of which such condition is set forth in the
Prospectus, except as referred to therein; (ii) there shall have been no material transaction
entered into by the Company or the Bank, independently or considered as one enterprise, from the
latest date as of which the financial condition of the Company is set forth in the Prospectus,
other than transactions referred to or contemplated therein; (iii) neither the Company nor the Bank
shall have received from the FDIC or the OTS any direction (oral or written) to make any material
change in the method of conducting their business with which it has not complied with in all
material respects (which direction, if any, shall have been disclosed to Agent) and which would
reasonably be expected to have a Material Adverse Effect; (iv) except as disclosed in the General
Disclosure Package and the Prospectus, the Company and its subsidiaries (including the Bank) are
not in violation of any enforcement action (formal or informal) from the OTS, the FDIC, or any
other agency that has directed the Company or any of
24
its subsidiaries (including the Bank) to make
any material change in the method of conducting their respective businesses; (v) neither the
Company nor the Bank shall have been in default (nor shall an event have occurred which, with
notice or lapse of time or both, would constitute a default) under any provision of any agreement
or instrument relating to any material outstanding indebtedness; (vi) no action, suit or
proceeding, at law or in equity or before or by any federal or state commission, board or other
administrative agency, shall be pending or, to the knowledge of the Company or the Bank, threatened
against the Company or the Bank or affecting any of their properties wherein an unfavorable
decision, ruling or finding would reasonably be expected to have a Material Adverse Effect; and
(vii) the Securities shall have been qualified or registered for offering and sale or issuance
under the securities or “Blue Sky” laws of the jurisdictions requested by Agent.
(i) At or prior to the applicable Closing Date, the Agent shall receive (i) a copy of the
order from the Commission declaring the Registration Statement effective, (ii) a certified copy of
the First Amended and Restated Articles of Incorporation of the Company, (iii) a certificate from
the FDIC evidencing the Bank’s insurance of accounts, and (vi) any other documents that Agent shall
reasonably request.
(j) Subsequent to the date hereof, there shall not have occurred any of the following: (i) a
suspension or limitation in trading in securities generally on the New York Stock Exchange, the
Nasdaq Global Select Market, the Nasdaq Capital Market or minimum or maximum prices for trading
have been fixed, or maximum ranges for prices for securities have been required by either of such
exchanges or FINRA or by order of the Commission or any other governmental authority other than
temporary trading halts or limitations (A) imposed as a result of intraday changes in the Dow Xxxxx
Industrial Average, (B) lasting no longer than until the regularly scheduled commencement of
trading on the next succeeding business-day, and (C) which, when combined with all other such halts
occurring during the previous five business days,
total less than three; (ii) a general moratorium on the operations of federally-insured
financial institutions or general moratorium on the withdrawal of deposits from federally-insured
financial institutions declared by either federal or state authorities; (iii) any outbreak of
hostilities or escalation thereof or other calamity or crisis, including, without limitation,
terrorist activities after the date hereof; or (iv) a material adverse change in the United States
financial markets or elsewhere if the effect of any of (i) through (iv) herein, in Agent’s
reasonable judgment, makes it impracticable or inadvisable to proceed with the Stock Offering on
the terms and in the manner contemplated in the Registration Statement and the Prospectus.
(k) Prior to the distribution of the Prospectus, the Agent shall have received an agreement
substantially in the form of Exhibit B hereto signed by the persons listed on Schedule
A hereto.
(l) All such opinions, certificates, letters and documents will be in compliance with the
provisions hereof only if they are reasonably satisfactory in form and substance to Agent and of
counsel for Agent. Any certificate signed by an officer of the Company or the Bank and delivered
to Agent or to counsel for Agent shall be deemed a representation and warranty by the Company or
the Bank, as the case may be, to Agent as to the statements made therein. If any condition to
Agent’s obligations hereunder to be fulfilled prior to or at the applicable Closing Time is not
fulfilled, Agent may terminate this Agreement (provided
25
that if this Agreement is so terminated but
the sale of Securities is nevertheless consummated, Agent shall be entitled to the compensation
provided for in Section 4 hereof) or, if Agent so elects, may waive any such conditions which have
not been fulfilled or may extend the time of their fulfillment.
(m) Prior to the Initial Closing Date, the Company shall have received all necessary
Shareholder Approvals required for the consummation of the Stock Offering and performance of its
obligations under this Agreement.
Section 10. Indemnification
(a) The Company agrees to indemnify and hold harmless the Agent, its officers, directors,
agents, attorneys, servants and employees and each person, if any, who controls the Agent within
the meaning of Section 15 of the Securities Act or Section 20(a) of the Exchange Act, against any
and all loss, liability, claim, damage or expense whatsoever (including but not limited to
settlement expenses, subject to the limitation set forth in the last sentence of paragraph (c)
below), joint or several, that the Agent or any of such officers, directors, agents, attorneys,
servants, employees and controlling Persons (collectively, the “Related Persons”) may suffer or to
which the Agent or the Related Persons may become subject under all applicable federal and state
laws or otherwise, and to promptly reimburse the Agent and any Related Persons upon written demand
for any reasonable expenses (including reasonable fees and disbursements of counsel) incurred by
the Agent or any Related Persons in connection with investigating, preparing or defending any
actions, proceedings or claims (whether commenced or threatened) to the extent such losses, claims,
damages, liabilities or actions: (i) arise out of the allocation of the Shares in accordance with
(x) the Prospectus generally and (y) the records or other information provided to the Agent by the
Company, or its agents; (ii) arise out of or are based upon any untrue statement or alleged untrue
statement of a
material fact contained in the Registration Statement (or any amendment or supplement
thereto), the General Disclosure Package, the Prospectus (or any amendment or supplement thereto),
any Issuer-Represented Free Writing Prospectus or any blue sky application, or other instrument or
document of the Company or based upon written information supplied by the Company filed in any
state or jurisdiction to register or qualify any or all of the Securities under the securities laws
thereof (collectively, the “Blue Sky Applications”), or any application or other document,
advertisement, or communication (“Sales Information”) prepared, made or executed by or on behalf of
the Company with its consent or based upon written information furnished by or on behalf of the
Company, whether or not filed in any jurisdiction, in order to qualify or register the Securities
under the securities laws thereof, (iii) arise out of or are based upon the omission or alleged
omission to state in any of the foregoing documents or information, a material fact required to be
stated therein or necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading; or (iv) arise from any theory of liability whatsoever
relating to or arising from or based upon this Agreement, the Registration Statement (or any
amendment or supplement thereto), the General Disclosure Package, the Prospectus the General
Disclosure Package, (or any amendment or supplement thereto), any Issuer-Represented Free Writing
Prospectus, any Blue Sky Applications or Sales Information or other documentation distributed in
connection with the Stock Offering; provided, however, that no indemnification is required under
this paragraph (a) to the extent such losses, claims, damages, liabilities or actions arise out of
or are based upon any untrue material statements or
26
alleged untrue material statements in, or material omission or alleged material omission from, the Registration Statement (or any amendment
or supplement thereto) or the Prospectus (or any amendment or supplement thereto), any
Issuer-Represented Free Writing Prospectus, the Blue Sky Applications or Sales Information or other
documentation distributed in connection with the Stock Offering made in reliance upon and in
conformity with the Agent Information.
(b) The Agent agrees to indemnify and hold harmless the Company, its directors and officers,
agents, servants and employees and each person, if any, who controls the Company within the meaning
of Section 15 of the Securities Act or Section 20(a) of the Exchange Act against any and all loss,
liability, claim, damage or expense whatsoever (including but not limited to settlement expenses,
subject to the limitation set forth in the last sentence of paragraph (c) below), joint or several,
which they, or any of them, may suffer or to which they, or any of them, may become subject under
all applicable federal and state laws or otherwise, and to promptly reimburse the Company and any
such persons upon written demand for any reasonable expenses (including fees and disbursements of
counsel) incurred by them in connection with investigating, preparing or defending any actions,
proceedings or claims (whether commenced or threatened) to the extent such losses, claims, damages,
liabilities or actions arise out of or are based upon any untrue statement or alleged untrue
statement of a material fact contained in, or material omission or alleged material omission of
material fact from, the Registration Statement (or any amendment or supplement thereto), the
General Disclosure Package, Prospectus or any Blue Sky Applications or Sales Information; provided,
however, that the Agent’s obligations under this Section 10(b) shall exist only if and only to the
extent that such untrue statement or alleged untrue statement was made in, or such material
omission or alleged material omission relates to, the Registration Statement (or any amendment or
supplement thereto), the General Disclosure Package, the Prospectus (or any amendment or supplement
thereto), any Blue Sky Applications or Sales Information in reliance upon and in conformity with
the Agent Information.
(c) Each indemnified party shall give prompt written notice to each indemnifying party of any
action, proceeding, claim (whether commenced or threatened), or suit instituted against it in
respect of which indemnity may be sought hereunder, but failure to so notify an indemnifying party
shall not relieve it from any liability which it may have on account of this Section 10, Section 11
or otherwise. An indemnifying party may participate at its own expense in the defense of such
action. In addition, if it so elects within a reasonable time after receipt of such notice, an
indemnifying party, jointly with any other indemnifying parties receiving such notice, may assume
the defense of such action with counsel chosen by it reasonably acceptable to the indemnified
parties that are defendants in such action, unless such indemnified parties reasonably object to
such assumption on the ground that there may be legal defenses available to them that are different
from or in addition to those available to such indemnifying party. If an indemnifying party
assumes the defense of such action, the indemnifying parties shall not be liable for any fees and
expenses of counsel for the indemnified parties incurred thereafter in connection with such action,
proceeding or claim, other than reasonable costs of investigation. In no event shall the
indemnifying parties be liable for the fees and expenses of more than one separate firm of
attorneys (unless an indemnified party or parties shall have reasonably concluded that there may be
defenses available to it or them which are different from or in addition to those of other
indemnified parties) for all indemnified parties in connection with any one action,proceeding or
claim or separate but similar or related actions,
27
proceedings or claims in the same jurisdiction
arising out of the same general allegations or circumstances. The Company shall be liable for any
settlement of any claim against the Agent (or its directors, officers, employees, affiliates or
controlling persons), made with the consent of the Company, which consent shall not be unreasonably
withheld. The Company shall not, without the written consent of the Agent, settle or compromise
any claim against them based upon circumstances giving rise to an indemnification claim against the
Company hereunder unless such settlement or compromise provides that the Agent and the other
indemnified parties shall be unconditionally and irrevocably released from all liability in respect
of such claim.
(d) The agreements contained in this Section 10 and in Section 11 hereof and the
representations and warranties of the Company and the Bank set forth in this Agreement shall remain
operative and in full force and effect regardless of (i) any investigation made by or on behalf of
the Agent or its officers, directors, controlling persons, agents, attorneys, servants or employees
or by or on behalf of the Company or any officers, directors, controlling persons, agents,
attorneys, servants or employees of the Company; (ii) delivery of and payment hereunder for the
Securities; or (iii) any termination of this Agreement.
Section 11. Contribution In order to provide for just and equitable contribution in
circumstances in which the indemnification provided for in Section 10 is due in accordance with its
terms but is found in a final judgment by a court to be unavailable from the Company or the Agent,
the Company on the one hand and the Agent on the other shall contribute to the aggregate losses,
claims, damages and liabilities of the nature contemplated by such indemnification in such
proportion so that (i) the Agent is responsible for that portion represented by the percentage that
the fees paid to the Agent pursuant to Section 4 of this Agreement (not including expenses) (the
“Agent’s Fees”) less any portion of Agent’s fees paid by Agent to assisting brokers, bear to the
total proceeds received by the Company from the sale of the Securities in the Stock Offering, net
of all
expenses of the Stock Offering, except Agent’s Fees and (ii) the Company shall be responsible
for the balance. If, however, the allocation provided above is not permitted by applicable law or
if the indemnified party or parties failed to give the notice required under Section 10 above, then
each indemnifying party or parties shall contribute to such amount paid or payable to such
indemnified party or parties in such proportion as is appropriate to reflect not only such relative
fault of the Company on the one hand and the Agent on the other in connection with the statements
or omissions which resulted in such losses, claims, damages or liabilities (or actions, proceedings
or claims in respect thereof), but also the relative benefits received by the Company on the one
hand and the Agent on the other from the Stock Offering, as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one hand and the Agent on the
other hand shall be deemed to be in the same proportion as the total proceeds from the Stock
Offering, net of all expenses of the Stock Offering except Agent’s Fees, received by the Company
bear, with respect to the Agent, to the total fees (not including expenses) received by the Agent
less any portion of Agent’s fees paid by Agent to assisting brokers. The relative fault shall be
determined by reference to, among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact relates to information
supplied by the Company on the one hand or the Agent on the other and the parties relative intent,
good faith, knowledge, access to information and opportunity to correct or prevent such statement
or omission. The Company and the Agent agree that it would not be just and equitable if
contribution pursuant to this Section 11 were determined by pro-rata allocation or by any other
method of allocation which
28
does not take account of the equitable considerations referred to above
in this Section 11. The amount paid or payable by an indemnified party as a result of the losses,
claims, damages or liabilities (or action, proceedings or claims in respect thereof) referred to
above in this Section 11 shall be deemed to include any legal or other expenses reasonably incurred
by such indemnified party in connection with investigating or defending any such action, proceeding
or claim. It is expressly agreed that the Agent shall not be liable for any loss, liability,
claim, damage or expense or be required to contribute any amount which in the aggregate exceeds the
amount paid (excluding reimbursable expenses) to the Agent under this Agreement. It is understood
and agreed that the above-stated limitation on the Agent’s liability is essential to the Agent and
that the Agent would not have entered into this Agreement if such limitation had not been agreed to
by the parties to this Agreement. No person found guilty of any fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution with
respect to any loss or liability arising from such misrepresentation from any person who was not
found guilty of such fraudulent misrepresentation. For purposes of this Section 11, each of the
Agent’s and the Company’s officers and directors and each person, if any, who controls the Agent or
the Company within the meaning of the Securities Act and the Exchange Act shall have the same
rights to contribution as the Company and the Agent. Any party entitled to contribution, promptly
after receipt of notice of commencement of any action, suit, claim or proceeding against such party
in respect of which a claim for contribution may be made against another party under this Section
11, will notify such party from whom contribution may be sought, but the omission to so notify such
party shall not relieve the party from whom contribution may be sought from any other obligation it
may have hereunder or otherwise than under this Section 11.
Section 12. Survival All representations, warranties and indemnities and other
statements contained in this Agreement or contained in certificates of officers of the Company or
the Agent submitted pursuant hereto, shall remain operative and in full force and effect,
regardless of any termination or cancellation of this Agreement or any investigation made by or on
behalf of the Agent or its controlling persons, or by or on behalf of the Company and shall survive
the issuance of the Securities, and any legal representative, successor or assign of the Agent, the
Company and any indemnified person shall be entitled to the benefit of the respective agreements,
indemnities, warranties and representations.
Section 13. Termination The Agent may terminate this Agreement by giving the notice
indicated below in this Section 13 at any time after this Agreement becomes effective as follows:
(a) In the event (i) the Company has failed, refused or been unable to perform any agreement
on its part to be performed under this Agreement, (ii) there has been, since the dates as of which
information is given in the preliminary prospectus, the General Disclosure Package or the
Prospectus, any material adverse change in the net asset value of the Company or the tax, exchange,
control or other laws or regulations applicable to the Company or the Company has made any material
change in its management or method of operations as described in the General Disclosure Package and
the Prospectus, the effect of which renders it impracticable to proceed with the solicitation of
the exercise of Rights; (iii) the Agent terminates this relationship because there has been a
material adverse change in the financial condition or operations of the Company and the Bank
considered as one enterprise since the date of the latest audited financial statements included in
the Prospectus; (iv) any other condition of the Agent’s
29
obligations under this Agreement is not
fulfilled; (v) trading in securities generally on the New York Stock Exchange, the Nasdaq Global
Select Market or the Nasdaq Capital Market has been suspended, or there shall have been established
by the New York Stock Exchange, the Nasdaq Global Select Market, the Nasdaq Capital Market or by
the Commission or by any federal or New York State agency or by the decision of any court of
competent jurisdiction, any general limitation on prices for such trading or any general
restrictions on the distribution of securities, all to such a degree as would, in the reasonable
judgment of the Agent, render it impracticable to proceed with the solicitation of the exercise of
Rights; (vi) a general banking moratorium has been declared by federal, Ohio or New York
authorities or by any other state authorities that, in the Agent’s reasonable judgment, makes it
impracticable to proceed with the solicitation of the exercise of Rights, (vii) there has been a
material adverse change in general economic, political or financial conditions in the United
States, or in the effect of international conditions on the financial markets in the United States
such that, in the reasonable judgment of the Agent, it is impracticable to proceed with the
solicitation of the exercise of Rights or (viii) the United States becomes engaged in hostilities,
a material escalation occurs in any hostilities in which the United States is engaged, or war or a
national emergency is declared by the United States on or after the date of this Agreement the
effect of which, in the reasonable judgment of the Agent, would render it impracticable to proceed
with the solicitation of the exercise of the Rights.
(b) If any of the conditions specified in Section 9 hereof shall not have been fulfilled when
and as required by this Agreement, or by any Closing Time, or waived in writing by the Agent, this
Agreement and all of the Agent’s obligations hereunder may be canceled by the Agent by notifying
the Company of such cancellation in writing at any time at or prior to the Closing Times, and any
such cancellation shall be without liability of any party to any other party except as otherwise
provided in Sections 4, 8, 10 and 11 hereof.
(c) If Agent elects to terminate this Agreement as provided in this Section, the Company shall
be notified by the Agent as provided in Section 14 hereof.
(d) If this Agreement is terminated in accordance with the provisions of this Agreement or the
sale of the Securities is not consummated, notwithstanding anything to the contrary in this
Agreement or the Letter Agreement, the Agent will receive only a reimbursement of out-of-pocket
accountable expenses actually incurred.
Section 14. 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 Agent shall be directed to Xxxxxx, Xxxxxxxx & Company,
Incorporated, 00 Xxxxxxxx Xxxxxxxx, Xxxxxxx Xxxx, Xxx Xxxxxx 00000, Attention: Xxxxxxx Xxxxxxx
(with a copy to Xxxxx Day, 000 Xxxxxxxx Xxxxxx, Xxxxxxxxx, Xxxx 00000, Attention: Xxxxxxxxxxx X.
Xxxxx); notice to the Company shall be directed to PVF Capital Corp., 00000 Xxxxxx Xxxx, Xxxxx,
Xxxx 00000, Attention: Xxxxxx X. Xxxx, Xx. (with a copy to Xxxxxxxxxx Xxxxxxxx LLP, Suite 900, 000
00xx Xxxxxx, XX, Xxxxxxxxxx, XX 00000-0000, Attention: Xxxx X. Xxxxx).
Section 15. No Advisory or Fiduciary Relationship The Company acknowledges and agrees
that in connection with all aspects of each transaction contemplated by this Agreement, the Company
on the one hand and the Agent on the other have an arms-length
30
business relationship that creates
no fiduciary duty on the part of the Agent and each of the Company and the Agent expressly
disclaims any fiduciary relationship. In addition, the Agent and its affiliates may be engaged in
a broad range of transactions that involve interests that differ from those of the Company. The
Agent has not provided any legal, accounting, regulatory or tax advice with respect to the Stock
Offering and the Company has consulted its own legal, accounting, regulatory and tax advisors to
the extent it deemed appropriate.
Section 16. Parties This Agreement shall inure to the benefit of and be binding upon
the Agent and the Company, 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
parties hereto and their respective successors and the controlling persons and officers and
directors referred to in Sections 10 and 11 and their heirs and legal representatives, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any provisions herein
contained. It is understood and agreed that this Agreement is the exclusive agreement among the
parties, supersedes any prior agreement among the parties, including the Letter Agreement, and may
not be varied except by a writing signed by all parties.
Section 17. Partial Invalidity In the event that any term, provision or covenant
herein or the application thereof to any circumstance or situation shall be invalid or
unenforceable, in whole or in part, the remainder hereof and the application of said term,
provision or covenant to any other circumstance or situation shall not be affected thereby, and
each term, provision or covenant herein shall be valid and enforceable to the full extent permitted
by law.
Section 18. Construction This Agreement shall be construed in accordance with the
laws of the State of New York without giving effect to its conflicts of laws principles. Any
dispute hereunder shall be brought in a court in the State of New York. The Company and the Agent
waive all right to trial by jury in any action, proceeding, claim or counterclaim (whether based on
contract, tort or otherwise) related to or arising out of this Agreement.
[SIGNATURE PAGE FOLLOWS]
31
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 on the other in
accordance with its terms.
Very truly yours, PVF CAPITAL CORP. |
||||
By: | /s/ Xxxxxx X. Xxxx, Xx. | |||
Xxxxxx X. Xxxx, Xx. | ||||
President and Chief Executive Officer | ||||
The foregoing Agency Agreement is
hereby confirmed and accepted as
of the date first set forth above.
hereby confirmed and accepted as
of the date first set forth above.
XXXXXX, XXXXXXXX & COMPANY, INCORPORATED |
||||
By: | /s/ Xxxxxxx Xxxxxxxxx | |||
Xxxxxxx Xxxxxxxxx | ||||
Managing Director |
Schedule A
Directors and Executive Officers:
Xxxxxx X. Xxxxxxxxx
Xxxxxx X. Xxxxxxx
Xxxxxxx X. Xxxxxx
Xxxx X. Xxxxxx
Xxxxxx X. Xxxxxx
Xxxxxx X. Xxxxxx, XX
Xxxxxxx X. Xxxxx
Xxxxxx X. Xxxx, Xx.
Xxxx X. Male
Xxxxxxx X. Xxxxxxxx
Xxxxxx X. Xxxxxx
Xxxxx X. Xxxxxxxxx
Xxxxxx X. Xxxxx
Standby Purchaser:
Xxxxx Xxxxxxx Partners II, L.P.
Exhibit B to the Agency Agreement
form of lock-up agreement
Xxxxxx, Xxxxxxxx & Company, Incorporated
00000 Xxxxxxx Xxxxxxxxx, Xxxxx 000
Xxxxxxxxx, Xxxx 00000
00000 Xxxxxxx Xxxxxxxxx, Xxxxx 000
Xxxxxxxxx, Xxxx 00000
Ladies and Gentlemen:
The undersigned, PVF Capital Corp., an Ohio corporation (the “Company”), the Company’s
executive officers and directors, and Xxxxx Xxxxxxx Partners II, L.P. (the “Standby Purchaser”),
understand that Xxxxxx, Xxxxxxxx & Company, Incorporated (“Xxxxxx Xxxxxxxx”) proposes to enter into
an Agency Agreement with the Company in connection with the Stock Offering (as defined below). The
Company is distributing, at no charge, subscription rights to purchase shares of Common Stock to
the holders of record of its Common Stock (a “Record Date Shareholder”) at 5:00 p.m. Eastern Time,
on January 27, 2010 (the “Record Date”) and, subject to the rights of such holders described below,
to certain other purchasers on a standby basis. Each Record Date Shareholder will receive one
non-transferable subscription right (a “Right”) for every share of Common Stock held of record at
the close of business on the Record Date. Each Right will entitle the holder thereof to subscribe
for a certain number of shares of Common Stock (the “Underlying Shares”) at $1.75 per share (the
“Subscription Price”) (the “Basic Subscription Privilege”). Each Record Date Shareholder who
exercises in full its Basic Subscription Privilege will also be eligible to subscribe at the
Subscription Price for shares of Common Stock not otherwise purchased pursuant to the exercise of
the Basic Subscription Privilege up to the total number of Underlying Shares, subject to
availability, proration and reduction by the Company in certain circumstances and, in all
instances, to a limit on ownership of the Common Stock (the “Over-Subscription Privilege”). The
offer and sale of the Underlying Shares pursuant to the exercise of the Basic Subscription
Privilege and the Over-Subscription Privilege are referred to herein as the “Rights Offering.”
The Company has separately entered into a “Standby Purchase Agreement” with Standby Purchaser,
pursuant to which the Standby Purchaser has agreed to acquire from the Company, at the Subscription
Price, the lesser of 2,436,610 shares of Common Stock or 9.61% of the Company’s outstanding Common
Stock on a fully diluted basis assuming completion of the Rights Offering, including shares issued
to the Standby Purchaser. The Standby Purchaser has conditioned its minimum purchase of shares of
Common Stock upon the receipt by the Company of $26.0 million in gross proceeds from the Rights
Offering, the offering to the Standby Purchaser and the Public Reoffer (as defined below), if any.
The maximum number of shares that may be sold in the Rights Offering and to the Standby Purchaser
is 17,142,857.
The Company may offer any shares of Common Stock that remain unsubscribed in the Rights
Offering at the expiration of the Rights Offering to the public at the Subscription Price per
B-1
share (the “Public Reoffer”). Any offering of shares of Common Stock in the Public Reoffer
shall be on a best efforts basis. The Public Reoffer shall terminate on April 9, 2010. The Rights
Offering, the offering to the Standby Purchaser and the Public Reoffer are together referred to
herein as the “Stock Offering,” and the Underlying Shares and the shares of Common Stock sold to
the Standby Purchaser and to the public in the Public Reoffer are collectively referred to herein
as the “Securities.”
In recognition of the benefit that the Stock Offering will confer upon the undersigned, and
for other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the undersigned hereby agrees that from the date hereof and until 180 days after the
consummation of all sales of Common Stock in the Stock Offering (such 180 day period being referred
to herein as the “Lock-Up Period”), to which you are or expect to become parties, the undersigned
will not (and will cause any spouse or immediate family member of the spouse or the undersigned
living in the undersigned’s household, any partnership, corporation or other entity within the
undersigned’s control, and any trustee of any trust that holds Common Stock or other securities of
the Company for the benefit of the undersigned or such spouse or family member not to) offer, sell,
contract to sell (including any short sale), pledge, hypothecate, establish an open “put equivalent
position” within the meaning of Rule 16a-1(h) under the Securities Exchange Act of 1934, as
amended, grant any option, right or warrant for the sale of, purchase any option or contract to
sell, sell any option or contract to purchase, or otherwise encumber, dispose of or transfer, or
grant any rights with respect to, directly or indirectly, any shares of Common Stock or securities
convertible into or exchangeable or exercisable for any shares of Common Stock, enter into a
transaction which would have the same effect, or enter into any swap, hedge or other arrangement
that transfers, in whole or in part, any of the economic consequences of ownership of the Common
Stock, whether any such aforementioned transaction is to be settled by delivery of the Common Stock
or such other securities, in cash or otherwise, or publicly disclose the intention to make any such
offer, sale, pledge or disposition, or to enter into any such transaction, swap, hedge or other
arrangement, without, in each case, the prior written consent of Xxxxxx Xxxxxxxx, which consent may
be withheld in Xxxxxx Xxxxxxxx’ sole discretion; provided, however, that if (i) during the last 17
days of the initial Lock-Up Period, the Company releases earnings results or material news or a
material event relating to the Company occurs or (ii) prior to the expiration of the initial
Lock-Up Period, the Company announces that it will release earnings results during the 16-day
period beginning on the last day of the initial Lock-Up Period, then in each case the Lock-Up
Period will be automatically extended until the expiration of the 18-day period beginning on the
date of release of the earnings results or the occurrence of the material news or material event,
as applicable, unless Xxxxxx Xxxxxxxx waives, in writing, such extension.
The undersigned hereby acknowledges and agrees that written notice of any extension of the
Lock-Up Period pursuant to the previous paragraph will be delivered by Xxxxxx Xxxxxxxx to the
Company (in accordance with Section 14 of the Agency Agreement) and that any such notice properly
delivered will be deemed to have been given to, and received by, the undersigned. The undersigned
further agrees that, prior to engaging in any transaction or taking any other action that is
subject to the terms of this Lock-Up Agreement during the period from the date of this Lock-Up
Agreement up to and including the 34th day following the expiration of the initial Lock-Up Period,
it will give notice thereof to Xxxxxx Xxxxxxxx and will not consummate such transaction or take any
such action unless it has received written confirmation from Xxxxxx Xxxxxxxx that the Lock-Up
Period (as may have been extended pursuant to the previous paragraph) has expired.
B-2
The foregoing restrictions shall not apply to bona fide gifts by the undersigned, provided
that (a) each resulting transferee of the Company’s securities executes and delivers to Xxxxxx
Xxxxxxxx an agreement satisfactory to Xxxxxx Xxxxxxxx certifying that such transferee is bound by
the terms of this Lock-Up Agreement and has been in compliance with the terms hereof since the date
first above written as if it had been an original party hereto and (b) to the extent any interest
in the Company’s securities is retained by the undersigned (or such spouse or family member), such
securities shall remain subject to the restrictions contained in this Lock-Up Agreement.
Any Common Stock received upon exercise of options granted to the undersigned will also be
subject to this Lock-Up Agreement. Any Common Stock acquired by the undersigned in the open market
on or after the Stock Offering Date (pursuant to a “friends and family” or directed share program
or otherwise) will not be subject to this Lock-Up Agreement. A transfer of Common Stock to a
family member or a trust for the benefit of the undersigned or a family member may be made,
provided the transferee agrees in writing prior to such transfer to be bound by the terms of this
Lock-Up Agreement as if it were a party hereto.
In furtherance of the foregoing, the Company and its transfer agent and registrar are hereby
authorized to (a) decline to make any transfer of shares of Common Stock if such transfer would
constitute a violation or breach of this Lock-Up Agreement and (b) place legends and stop transfer
instructions on any such shares of Common Stock owned or beneficially owned by the undersigned.
The undersigned represents and warrants that the undersigned has full power and authority to
enter into this Lock-Up Agreement. This Lock-Up Agreement is irrevocable and shall be binding on
the undersigned and the successors, heirs, personal representatives and assigns of the undersigned.
This Lock-Up Agreement shall be governed by and construed in accordance with the laws of the State
of New York, without regard to choice of law rules. This Lock-Up Agreement shall lapse and become
null and void if the Stock Offering Date shall not have occurred on or before May 31, 2010.
Very truly yours, | ||
Printed Name: |
||
Date: |
B-3