EXHIBIT 99.2
[LETTERHEAD OF RP FINANCIAl APPEARS HERE]
April 29, 1998
Board of Directors
c/o Xx. Xxxxxx Xxxxxxxx, President and CEO
Provident Bank
000 Xxxxx Xxxxxxxxx
Xxxxxxxxxx, Xxx Xxxx 00000
Dear Members of the Board:
This letter sets forth the agreement between Provident Bank, Montebello,
New York ("Provident" or the "Bank"), and RP Financial, LC. ("RP Financial"),
whereby the Bank has engaged RP Financial to prepare the regulatory business
plan and financial projections to be adopted by the Bank's Board of Directors in
conjunction with the concurrent mutual holding company reorganization and
minority stock offering. These services are described in greater detail below.
Description of Proposed Services
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RP Financial's business planning services will include the following areas:
(1) evaluating Provident's current financial and operating condition, business
strategies and anticipated strategies in the future; (2) analyzing and
quantifying the impact of business strategies, incorporating the use of net
offering proceeds both in the short and long term; (3) preparing detailed
financial projections on a quarterly basis for a period of at least three fiscal
years to reflect the impact of Board approved business strategies and use of
proceeds; (4) preparing the written business plan document which conforms with
applicable regulatory guidelines including a description of the use of proceeds
and how the convenience and needs of the community will be addressed; and (5)
preparing the detailed schedules of the capitalization of the Bank and mutual
holding company and related cash flows.
Contents of the business plan will include: Philosophy/Goals; Economic
Environment and Background; Lending, Leasing and Investment Activities; Deposit,
Savings and Borrowing Activity; Asset and Liability Management; Operations;
Records, Systems and Controls; Growth, Profitability and Capital; Responsibility
for Monitoring this Plan.
RP Financial agrees to prepare the business plan and accompanying financial
projections in writing such that the business plan can be filed with the
appropriate regulatory agencies prior to filing the appropriate applications.
Board of Directors
April 29, 1998
Page 2
Fee Structure and Payment Schedule
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The Bank agrees to compensate RP Financial for preparation of the business
plan on a fixed fee basis of $7,500. Payment of the professional fees shall be
made upon delivery of the completed business plan.
The Bank also agrees to reimburse RP Financial for those direct out-of-
pocket expenses necessary and incidental to providing the business planning
services. Reimbursable expenses will likely include shipping,
telephone/facsimile printing, computer and data services, and shall be paid to
RP Financial as incurred and billed. RP Financial will agree to limit
reimbursable expenses to a cap of $10,000 in conjunction with the appraisal
engagement, subject to written authorization from the Bank to exceed such level.
In the event the Bank shall, for any reason, discontinue this planning
engagement prior to delivery of the completed business plan and payment of the
progress payment fee, the Bank agrees to compensate RP Financial according to RP
Financial's standard billing rates for consulting services based on accumulated
and verifiable time expenses, not to exceed the fixed fee described above, plus
reimbursable expenses incurred.
If during the course of the planning engagement, unforeseen events occur so
as to materially change the nature or the work content of the business planning
services described in this contract, the terms of said contract shall be subject
to renegotiation by the Bank and RP Financial. Such unforeseen events may
include changes in regulatory requirements as it specifically relates to
Provident or potential transactions which will dramatically impact the Bank such
as a pending acquisition or branch transaction.
* * * * * * * * * * *
Please acknowledge your agreement to the foregoing by signing as indicated
below and returning to RP Financial a signed copy of this letter.
Sincerely,
/s/ Xxxxxx X. Xxxxxxx
Xxxxxx X. Xxxxxxx
President and Managing Director
Agreed To and Accepted By: Xxxxxx Xxxxxxxx /s/ Xxxxxx Xxxxxxxx
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President and Chief Executive Officer
Upon Authorization by the Board of Directors For: Provident Bank
Montebello, New York
Date Executed:/s/ Xxxxxx Xxxxxxxx 5/28/98
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