Exhibit 1.2
Delaware First Financial Corporation
_______ to _______ Shares
Common Stock
(Par Value $.01 Per Share)
$10.00 Per Share
SALES AGENCY AGREEMENT
----------------------
Trident Securities, Inc.
0000 Xxx Xxxxx Xxxx, Xxxxx 000
Xxxxxxx, Xxxxx Xxxxxxxx 00000
Dear Sirs:
Delaware First Financial Corporation, a Delaware-chartered corporation
(the "Company"), and Ninth Xxxx Savings Bank, FSB, a Federally-chartered and
federally insured mutual savings bank (the "Bank"), hereby confirm, as of
________ ___, 1997, their respective agreements with Trident Securities, Inc.
("Trident"), a broker-dealer registered with the Securities and Exchange
Commission ("Commission") and a member of the National Association of Securities
Dealers, Inc. ("NASD"), as follows:
1. Introductory. The Bank intends to convert from a Federally-chartered
mutual savings bank to a Federally-chartered stock savings bank as a wholly
owned subsidiary of the Company (together with the Offerings, as defined below,
the issuance of shares of common stock of the Bank to the Company and the
incorporation of the Company, the "Conversion") pursuant to a plan of conversion
adopted on June 30, 1997 and as amended on September 17, 1997 (as amended, the
"Plan"). In accordance with the Plan, the Company is offering shares of its
common stock, par value $.01 per share (the "Shares" and the "Common Stock"),
pursuant to nontransferable subscription rights in a subscription offering (the
"Subscription Offering") to certain depositors of the Bank and to the Bank's
tax-qualified employee benefit plans (ie., the Bank's Employee Stock Ownership
Plan (the "ESOP")). Shares of the Common Stock not sold in the Subscription
Offering may be offered to the general public in a community offering, with
preference given to natural persons (including individual retirement and Xxxxx
retirement accounts and personal trusts in which such natural persons have
substantial interests) residing in the State of Delaware and the Pennsylvania
counties of Xxxxxxx and Delaware, the Maryland county of Xxxxx, and the New
Jersey country of Salem (the "Community Offering") (the Subscription and
Community Offerings are sometimes referred to collectively as the "Offerings"),
subject to the right of the Company and the Bank, in their absolute discretion,
to reject orders in the Community Offering in whole or in part. In the
Offerings, the Company is offering between __________ and __________ Shares,
with the possibility of offering up to __________ Shares without a
resolicitation of subscribers, as contemplated by the final regulations
regarding mutual-to-stock conversions of the Office of Thrift Supervision
("OTS"). Each Eligible Account Holder and Supplemental Eligible Account Holder
(each as defined in the Plan) may purchase in the Subscription Offering the
greater of $100,000 of the Common Stock for a single account whether held
jointly or
Trident Securities, Inc.
Sales Agency Agreement
Page 2
individually, $200,000 of the Common Stock when aggregated with purchases by an
Associate of that person (as defined in the Plan) or 15 times the product
(rounded down to the next whole number) obtained by multiplying the total number
of shares of Conversion Stock to be issued by a fraction of which the numerator
is the amount of the Qualifying Deposit of the Eligible Account Holder or
Supplemental Eligible Account Holder and the denominator is the total amount of
Qualifying Deposits of all Eligible Account Holders or Supplemental Eligible
Account Holders in the Bank on the Eligibility Record Date; Other Members (as
defined in the Plan) may purchase in the Subscription Offering the greater of
$100,000 of the Common Stock for a single account whether held jointly or
individually, $200,000 of the Common Stock when aggregated with purchases by an
Associate of that person (as defined in the Plan) or 0.1 of 1% of the total
offering of shares of Conversion Stock. Persons purchasing shares of Common
Stock in the Community Offering, together with Associates of (as defined in the
Plan) and persons Acting in Concert with such persons (as defined in the Plan),
may purchase in the Community Offering the greater of $100,000 of the Common
Stock for a single account whether held jointly or individually, $200,000 of the
Common Stock when aggregated with purchases by an Associate of that person (as
defined in the Plan), except that the Tax-Qualified Employee Stock Benefit Plans
may purchase up to 10% of the total shares of Conversion Stock to be issued in
the Stock Conversion.
The Company and the Bank have been advised by Trident that it will
utilize its best efforts in assisting the Company and the Bank with the sale of
the Shares in the Offerings and, if deemed necessary by the Company in a
syndicated community offering. Prior to the execution of this Agreement, the
Company has delivered to Trident the Prospectus dated __________, 1997 (as
hereinafter defined) and all supplements thereto to be used in the Offerings.
Such Prospectus contains information with respect to the Company, the Bank and
the Shares.
2. Representations and Warranties.
(a) The Company and the Bank jointly and severally represent and
warrant to Trident that:
(i) The Company has filed with the Comnission a registration
statement, including exhibits and an amendment or amendments thereto,
on Form SB-2 (No. 333-_____), including a Prospectus relating to the
Offerings, for the registration of the Shares under the Securities Act
of 1933, as amended (the "Act"); and such registration statement has
become effective under the Act and no stop order has been issued with
respect thereto and no proceedings therefor have been initiated or, to
the Company's best knowledge, threatened by the Commission. Except as
the context may otherwise require, such registration statement, as
amended or supplemented, on file with the Commission at the time the
registration statement became effective, including the Prospectus,
financial statements, schedules, exhibits and all other documents
filed as part thereof, as amended and supplemented, is herein called
the "Registration Statement," and the prospectus, as amended or
supplemented, on file with the
Trident Securities, Inc.
Sales Agency Agreement
Page 3
Commission at the time the Registration Statement became effective is
herein called the "Prospectus," except that if the prospectus filed by
the Company with the Commission pursuant to Rule 424(b) of the general
rules and regulations of the Commission under the Act (together with
the enforceable published policies and releases of the Commission
thereunder, the "SEC Regulations") differs from the form of prospectus
on file at the time the Registration Statement became effective, the
term "Prospectus" shall refer to the Rule 424(b) prospectus from and
after the time it is filed with or mailed for filing to the Commission
and shall include any amendments or supplements thereto from and after
their dates of effectiveness or use, respectively. If any Shares
remain unsubscribed following completion of the Subscription Offering
and the Community Offering, the Company (i) will promptly file with
the Commission a post-effective amendment to such Registration
Statement relating to the results of the Subscription and the
Community Offerings, any additional information with respect to the
proposed plan of distribution and any revised pricing information or
(ii) if no such post-effective amendment is required, will file with,
or mail for filing to, the Commission a prospectus or prospectus
supplement containing information relating to the results of the
Subscription and the Community Offerings and pricing information
pursuant to Rule 424(c) of the SEC Regulations, in either case in a
form reasonably acceptable to the Company and Trident.
(ii) The Bank has filed an Application for the Mutual-to-Stock
Conversion, including exhibits (as amended or supplemented, the
"Application") with the OTS under Home Owners' Loan Act ("HOLA") and
the enforceable rules and regulations, including published policies
and actions, of the OTS thereunder (the "OTS Regulations"), which has
been approved by the OTS; and the Prospectus and the proxy statement
for the solicitation of proxies from members for the special meeting
to approve the Plan (the "Proxy Statement") included as part of the
Application have been approved for use by the OTS. No order has been
issued by the OTS preventing or suspending the use of the Prospectus
or the Proxy Statement; and no action by or before the OTS revoking
such approvals is pending or, to the Bank's best knowledge,
threatened.
(iii) At the date of the Prospectus and at all times subsequent
thereto through and including the Closing Date (i) the Registration
Statement and the Prospectus (as amended or supplemented, if amended
or supplemented) complied with the Act and the SEC Regulations, (ii)
the Registration Statement (as amended or supplemented, if amended or
supplemented) 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 not misleading, and (iii) the
Prospectus (as amended or supplemented, if amended or supplemented)
did not contain any untrue statement of a material fact or omit 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
Trident Securities, Inc.
Sales Agency Agreement
Page 4
made,not misleading. Representations or warranties in this subsection
shall not apply to statements or omissions made in reliance upon and
in conformity with written information furnished to the Company or the
Bank relating to Trident by or on behalf of Trident expressly for use
in the Registration Statement or Prospectus.
(iv) The Company has been duly incorporated as a Delaware
corporation, and the Bank has been duly organized as a mutual savings
bank under the laws of the United States, and each of them is validly
existing and in good standing under the laws of the jurisdiction of
its organization with full power and authority to own its property
and conduct its business as described in the Registration Statement
and Prospectus; the Bank is a member in good standing of the Federal
Home Loan Bank of Pittsburgh; and the deposit accounts of the Bank are
insured by the Savings Association Insurance Fund ("SAIF")
administered by the Federal Deposit Insurance Corporation ("FDIC") up
to the applicable legal limits. Each of the Company and the Bank is
not required to be qualified to do business as a foreign corporation
in any jurisdiction where nonqualification would have a material
adverse effect on the Company and the Bank, taken as a whole. The Bank
does not own equity securities of or an equity interest in any
business enterprise except as described in the Prospectus. Upon
amendment of the Bank's charter and bylaws as provided in the rules
and regulations of the OTS and completion of the sale by the Company
of the Shares as contemplated by the Prospectus: (i) the Bank will be
converted pursuant to the Plan to a Federally chartered capital stock
savings bank with full power and authority to own its property and
conduct its business as described in the Prospectus, (ii) all of the
authorized and outstanding capital stock of the Bank will be owned of
record and beneficially by the Company, and (iii) the Company will
have no direct subsidiaries other than the Bank. The activities of the
Bank are permissible to subsidiaries of a savings and loan holding
company by the rules, regulations, policies and practices of the OTS.
(v) The Bank has good, marketable and insurable title to all
assets material to its business and to those assets described in the
Prospectus as owned by it, free and clear of all material Hens,
charges, encumbrances or restrictions, except for liens for taxes not
yet due, except as described in the Prospectus and except as could not
in the aggregate have a material adverse effect upon the operations or
financial condition of the Bank; and all of the leases and subleases
material to the operations or financial condition of the Bank, under
which it holds properties, including those described in the
Prospectus, are in full force and effect as described therein.
(vi) The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby have been duly
and validly authorized by all necessary actions on the part of each of
the Company and the Bank, and this Agreement is a valid and binding
obligation with valid execution and delivery of each of the Company
and the Bank, enforceable in accordance with its terms (except as the
Trident Securities, Inc.
Sales Agency Agreement
Page 5
enforceability may be limited by bankruptcy, insolvency, moratorium,
reorganization or similar laws relating to or affecting the
enforcement of creditors' rights generally or the rights of creditors
of depository institution holding companies the accounts of whose
subsidiaries are insured by the FDIC or by general equity principles,
regardless of whether such enforceability is considered in a
proceeding in equity or at law, and except to the extent that the
provisions of Sections 8 and 9 hereof may be unenforceable as against
public policy or pursuant to Section 23A of the Federal Reserve Act,
12 U.S.C. Section 371c ("Section 23A")).
(vii) There is no litigation or governmental proceeding pending
or, to the best knowledge of the Company or the Bank, threatened
against or involving the Company or the Bank or any of their
respective assets which individually or in the aggregate would
reasonably be expected to have a material adverse effect on the
condition (financial or otherwise), results of operations and
business, including the assets and properties, of the Company and the
Bank, taken as a whole.
(viii) The Company and the Bank have received the opinions of
Peabody and Xxxxx, Washington, D.C. with respect to federal tax
consequences of the Conversion, and of Young, Conaway, Stargatt &
Xxxxxx with respect to Delaware income tax consequences of the
Conversion, to the effect that the Conversion will constitute a tax
free reorganization under the Internal Revenue Code of 1986, as
amended, and will not be a taxable transaction for the Bank or the
Company under the laws of Delaware, and the facts relied upon in such
opinions are accurate and complete.
(ix) Each of the Company and the Bank has all such corporate
power, authority, authorizations, approvals and orders as may be
required to enter into this Agreement and to carry out the provisions
and conditions hereof, subject to the limitations set forth herein and
subject to the satisfaction of certain conditions imposed by the OTS
in connection with its approval of the Application, and except as may
be required under the securities, or "blue sky," laws of various
jurisdictions, and in the case of the Company, as of the Closing Date,
will have such approvals and orders to issue and sell the Shares to be
sold by the Company as provided herein, and in the case of the Bank,
as of the Closing Date, will have such approvals and orders to issue
and sell the Shares of its Common Stock to be sold to the Company as
provided in the Plan, subject to the issuance of an amended charter in
the form required for Federally chartered stock savings banks (the
"Stock Charter"), the form of which Stock Charter has been approved by
the OTS.
(x) Neither the Company nor the Bank is in violation of any rule
or regulation of the OTS that could reasonably be expected to result
in any enforcement action against the Company or the Bank or their
officers or directors that might have a material adverse effect on
the condition (financial or otherwise), operations, businesses,
Trident Securities, Inc.
Sales Agency Agreement
Page 6
assets or properties of the Company and the Bank, taken as a whole.
(xi) The financial statements and any related notes or schedules
which are included in the Registration Statement and the Prospectus
fairly present the financial condition, income, equity and cash flows
of the Bank at the respective dates thereof and for the respective
periods covered thereby and comply as to form with the applicable
accounting requirements of the SEC Regulations and the applicable
accounting regulations of the OTS. Such financial statements have
been prepared in accordance with generally accepted accounting
principles consistently applied throughout the periods involved,
except as set forth therein, and such financial statements are
consistent with financial statements and other reports filed by the
Bank with supervisory and regulatory authorities except as such
generally accepted accounting principles may otherwise require. The
tables in the Prospectus accurately present the information purported
to be shown thereby at the respective dates thereof and for the
respective periods therein.
(xii) There has been no material change in the condition
(financial or otherwise), results of operations or business, including
assets and properties, of the Company and the Bank, taken as a whole,
since the latest date as of which such condition is set forth in the
Prospectus, except as set forth therein; and the capitalization,
assets, properties and business of each of the Company and the Bank
conform to the descriptions thereof contained in the Prospectus.
Neither the Company nor the Bank has any material liabilities of any
kind, contingent or otherwise, except as set forth in the Prospectus.
(xiii) There has been no breach or default (or the occurrence of
any event which, with notice or lapse of time or both, would
constitute a default) under, or creation or imposition of any lien,
charge or other encumbrance upon any of the properties or assets of
the Company or the Bank pursuant to any of the terms, provisions or
conditions of, any agreement, contract, indenture, bond, debenture,
note, instrument or obligation to which the Company or the Bank is a
party or by which either of them or any of their respective assets or
properties may be bound or is subject, or violation of any
governmental license or permit or any enforceable published law,
administrative regulation or order or court order, writ, injunction or
decree, which breach, default, encumbrance or violation would have a
material adverse effect on the condition (financial or otherwise),
operations, business, assets or properties of the Company and the Bank
taken as a whole; all agreements which are material to the condition
(financial or otherwise), results of operations or business of the
Company and the Bank taken as a whole are in full force and effect,
and no party to any such agreement has instituted or, to the best
knowledge of the Company and the Bank, threatened any action or
proceeding wherein the Company or the Bank would be alleged to be in
default thereunder.
Trident Securities, Inc.
Sales Agency Agreement
Page 7
(xiv) Neither the Company nor the Bank is in violation of its
respective articles of incorporation or charter or bylaws. The
execution and delivery hereof and the consummation of the transactions
contemplated hereby by the Company and the Bank do not conflict with
or result in a breach of the articles of incorporation or charter or
bylaws of the Company or the Bank (in either mutual or stock form) or
constitute a material breach of or default (or an event which, with
notice or lapse of time or both, would constitute a default) under,
give rise to any right of termination, cancellation or acceleration
contained in, or result in the creation or imposition of any lien,
charge or other encumbrance upon any of the properties or assets of
the Company or the Bank pursuant to any of the terms, provisions or
conditions of any material agreement, contract, indenture, bond,
debenture, note, instrument or obligation to which the Company or the
Bank is a party or violate any governmental license or permit or any
enforceable published law, administrative regulation or order or court
order, writ, injunction or decree (subject to the satisfaction of
certain conditions imposed by the OTS in connection with its approval
of the Application), which breach, default, encumbrance or violation
would have a material adverse effect on the condition (financial or
otherwise), operations or business of the Company and the Bank taken
as a whole.
(xv) Subsequent to the respective dates as of which information
is given in the Registration Statement and Prospectus and prior to the
Closing Date (as hereinafter defined), except as otherwise may be
indicated or contemplated therein, none of the Company or the Bank has
issued any securities which will remain issued at the Closing Date or
incurred any liability or obligation, direct or contingent or borrowed
money, except borrowings or liabilities in the ordinary course of
business, or entered into any other transaction not in the ordinary
course of business and consistent with prior practices, which is
material in light of the business of the Company and the Bank, taken
as a whole.
(xvi) Upon consummation of the Conversion, the authorized, issued
and outstanding equity capital of the Company shall be within the
range as set forth in the Prospectus under the caption
"Capitalization," and no Common Stock of the Company shall be
outstanding immediately prior to the Closing Date; the issuance and
the sale of the Shares of the Company have been duly authorized by all
necessary action of the Company and approved by the OTS and, when
issued in accordance with the terms of the Plan and paid for, shall be
validly issued, fully paid and nonassessable and shall conform to the
description thereof contained in the Prospectus; the issuance of the
Shares is not subject to preemptive rights, except as set forth in the
Prospectus; and good title to the Shares will be transferred by the
Company upon issuance thereof against payment therefor, free and clear
of all claims, encumbrances, security interests and liens against the
Company whatsoever. The certificates representing the Shares
Trident Securities, Inc.
Sales Agency Agreement
Page 8
will conform in all material respects with the requirements of
applicable laws and regulations. The issuance and sale of the capital
stock of the Bank to the Company has been duly authorized by all
necessary action of the Bank and the Company and appropriate
regulatory authorities (subject to the satisfaction of various
conditions imposed by the OTS in connection with its approval of the
Application), and such capital stock, when issued in accordance with
the terms of the Plan, will be fully paid and nonassessable and will
conform in all material respects to the description thereof contained
in the Prospectus.
(xvii) No approval of any regulatory or supervisory or other
public authority is required in connection with the execution and
delivery of this Agreement or the issuance of the Shares, except for
such approvals as have been obtained, the declaration of effectiveness
of any required post-effective amendment by the Commission and
approval thereof by the OTS, the issuance of the Stock Charter by the
OTS and as may be required under the securities laws of various
jurisdictions.
(xviii) All contracts and other documents required to be filed as
exhibits to the Registration Statement or the Application have been
filed with the Commission or the OTS, as the case may be.
(xix) Deloitte & Touche, LLP, which has audited the financial
statements of the Bank as of December 31, 1996 and 1995 included in
the Prospectus, is an independent public accountant within the meaning
of the Code of Professional Ethics of the American Institute of
Certified Public Accountants.
(xx) For the past five years, the Company and the Bank have
timely filed all required federal, state and local income or franchise
tax returns, and no deficiency has been asserted with respect to such
returns by any taxing authorities, and the Company and the Bank have
paid all taxes that have become due and, to the best of the knowledge
of the Company and the Bank, the Company and the Bank have made
adequate reserves for similar future tax liabi1ities, except where any
failure to make such filings, payments and reserves, or the assertion
of such a deficiency, would not have a material adverse effect on the
condition of the Company and the Bank taken, as a whole.
(xxi) All of the loans represented as assets of the Bank on the
most recent financial statements of the Bank included in the
Prospectus meet or are exempt from all requirements of federal, state
or local law pertaining to lending, including without limitation truth
in lending (including the requirements of Regulation 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 have a material adverse effect on the Company and the
Trident Securities, Inc.
Sales Agency Agreement
Page 9
Bank taken as a whole.
(xxii) The records of account holders, depositors, borrowers and
other members of the Bank delivered to Trident by the Bank or its
agent for use during the Conversion have been prepared or reviewed by
the Bank and, to the best knowledge of the Company and the Bank, are
reliable and accurate.
(xxiii) None of the Company or the Bank, or, to the best
knowledge of the Company and the Bank, the employees of the Company or
the Bank, has made any payment of funds of the Company or the Bank
prohibited by law, and no funds of the Company or the Bank have been
set aside to be used for any payment prohibited by law.
(xxiv) To the best knowledge of the Company and the Bank, the
Company and the Bank are in compliance with all laws, rules and
regulations relating to the discharge, storage, handling and disposal
of hazardous or toxic substances, pollutants or contaminants and
neither the Company nor the Bank believes that the Company or the Bank
is subject to liability under the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended, or any
similar law, except for violations which, if asserted, would not have
a material adverse effect on the Company and the Bank, taken as a
whole. There are no actions, suits, regulatory investigations or other
proceedings pending or, to the best knowledge of the Company or the
Bank, threatened against the Company or the Bank relating to the
discharge, storage, handling and disposal of hazardous or toxic
substances, pollutants or contaminants. To the best knowledge of the
Company and the Bank, 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 been caused by the Company or the Bank or, to
the best knowledge of the Company or the Bank, has occurred on, in or
at any of the facilities or properties of the Company or the Bank,
except such disposal, release or discharge which would not have a
material adverse effect on the Company and the Bank, taken as a whole.
(xxv) At the Closing Date (as defined in Section 3 hereof), the
Company and the Bank will have completed the conditions precedent to,
and shall have conducted the Conversion in all material respects in
accordance with, the Plan, the OTS Regulations and all other
applicable laws, regulations, published decisions and orders,
including all terms, conditions, requirements and provisions precedent
to the Conversion imposed by the OTS.
(b) Trident represents and warrants to the Company and the Bank that:
(i) Trident is registered as a broker-dealer with the Commission,
and is in good
Trident Securities, Inc.
Sales Agency Agreement
Page 10
standing with the Commission and the NASD.
(ii) Trident is validly existing as a corporation in good
standing under the laws of its jurisdiction of incorporation, with
full corporate power and authority to provide the services to be
furnished to the Company and the Bank hereunder.
(iii) The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby have been duly
and validly authorized by all necessary action on the part of Trident,
and this Agreement is a legal, valid and binding obligation of
Trident, enforceable in accordance with its terms (except as the
enforceability thereof may be limited by bankruptcy, insolvency,
moratorium, reorganization or similar laws relating to or affecting
the enforcement of creditors' rights generally or the rights of
creditors of registered broker-dealers accounts of whose may be
protected by the Securities Investor Protection Corporation or by
general equity principles, regardless of whether such enforceability
is considered in a proceeding in equity or at law, and except to the
extent that the provisions of Sections 8 and 9 hereof may be
unenforceable as against public policy or pursuant to Section 23A).
(iv) Each of Trident and, to Tridents knowledge, its employees,
agents and representatives who shall perform any of the services
required hereunder to be performed by Trident shall be duly authorized
and shall have all licenses, approvals and permits necessary to
perform such services, and Trident is a registered selling agent in
the jurisdictions listed in Exhibit A hereto and will remain
registered in such jurisdictions in which the Company is relying on
such registration for the sale of the Shares, until the Conversion is
consurnmated or terminated.
(v) The execution and delivery of this Agreement by Trident, the
fulfillment of the terms set forth herein and the consummation of the
transactions contemplated hereby shall not violate or conflict with
the corporate charter or bylaws of Trident or violate, conflict with
or constitute a breach of, or default (or an event which, with notice
or lapse of time, or both, would constitute a default) under, any
material agreement, indenture or other instrument by which Trident is
bound or under any governmental license or permit or any law,
administrative regulation, authorization, approval or order or court
decree, injunction or order.
(vi) Any funds received by Trident to purchase Common Stock will
be handled in accordance with Rule 15c2-4 under the Securities
Exchange Act of 1934, as amended (the "Exchange Act").
(vii) There is not now pending or, to Trident's knowledge,
threatened against Trident any action or proceeding before the
Commission, the NASD, any state
Trident Securities, Inc.
Sales Agency Agreement
Page I I
securities commission or any state or federal court concerning
Trident' s activities as a broker-dealer.
3. Emp1oyment of Trident: Sale and Delivery of the Shares: On the basis
of the representations and warranties herein contained, but subject to the
terms and conditions herein set forth, the Company and the Bank hereby employ
Trident as their agent to utilize its best efforts in assisting the Company
with the Company's sale of the Shares in the Subscription Offering and Community
Offering. The employment of Trident hereunder shall terminate (a) forty-five
(45) days after the Subscription and Community Offering closes, unless the
Company and the Bank, with the approval of the OTS, are permitted to extend such
period of time, or (b) upon consummation of the Conversion, whichever date
shall first occur.
In the event the Company is unable to sell a minimum of _______ Shares
(or such lesser amount as the OTS may permit) within the period herein provided,
this Agreement shall terminate, and the Company and the Bank shall refund
promptly to any persons who have subscribed for any of the Shares, the full
amount which it may have received from them, together with interest as provided
in the Prospectus, and no party to this Agreement shall have any obligation to
the other party hereunder, except as set forth in Sections 6, 8 and 9 hereof.
Appropriate arrangements for placing the funds received from subscriptions for
Shares in special interest-bearing accounts with the Bank until all Shares are
sold and paid for were made prior to the commencement of the Subscription and
Community Offering, with provision for prompt refund to the purchasers as set
forth above, or for delivery to the Company if all Shares are sold.
If all conditions precedent to the consummation of the Conversion are
satisfied, including the sale of all Shares required by the Plan to be sold, the
Company agrees to issue or have issued such Shares and to release for delivery
certificates to subscribers thereof for such Shares on the Closing Date against
payment to the Company by any means authorized pursuant to the Prospectus, at
the principal office of the Company at 000 Xxxxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx
00000 or at such other place as shall be agreed upon between the parties hereto.
The date upon which the Company shall release the Shares sold in the Offerings
in accordance with the terms hereof is herein called the "Closing Date."
Trident agrees either (a) upon receipt of an executed order form of a
subscriber to forward the offering price of the Common Stock ordered on or
before twelve noon on the next business day following receipt or execution of an
order form by Trident to the Bank for deposit in a segregated account or (b) to
solicit indications of interest in which event (i) Trident will subsequently
contact any potential subscriber indicating interest to confirm the interest and
give instructions to execute and return an order form or to receive
authorization to execute the order form on the subscribees behalf, (ii) Trident
will mail acknowledgments of receipt of orders to each subscriber confirming
interest on the business day following such confimiation, (iii) Trident will
debit accounts of such subscfibers on the fifth business day ("debit date")
following receipt of the confirmation referred to in (i), and (iv) Trident will
forward completed order forms together with such funds to the Bank on or before
twelve noon on
Trident Securities, Inc.
Sales Agency Agreement
Page 12
the next business day following the debit date for deposit in a segregated
account. Trident acknowledges that if the procedure in (b) is adopted,
subscribers' funds are not required to be in their accounts until the debit
date.
In addition to the expenses specified in Section 6 hereof Trident shall
receive the following compensation for its services hereunder:
(a) (i) a proxy solicitation and conversion center management fee
in the amount of $10,000, (ii) a commission equal to one and one half
percent (1.5%) of the aggregate dollars amount of capital stock sold
in the subscription and community offerings, excluding any shares of
conversion stock sold to the Bank's directors, executive officers and
the ESOP. Additionally, commissions, will be excluded on those shares
sold to Associates (as defined in the Plan) of the Bank's directors
and executives officers, and (iii) for stock sold by other NASD member
firms under selected dealer's agreements, the commission shall not
exceed a fee to be agreed upon jointly by Trident, the Company and the
Bank to reflect market requirements at the time of the stock
allocation in a Syndicated Community Offering. All such fees are to be
payable in next-day funds to Trident on the Closing Date.
(b) Trident shall be reimbursed for allocable expenses, including
but not limited to travel, communications, legal fees and expenses and
postage, incurred by it whether or not the Offerings are successfully
completed; provided, however, that neither the Company nor the Bank
shall pay or reimburse Trident for any of the foregoing expenses
accrued after Trident shall have notified the Company or the Bank of
its election to terminate this Agreement pursuant to Section 11 hereof
or after such time as the Company or the Bank shall have given notice
in accordance with Section 12 hereof that Trident is in breach of this
Agreement. Trident's reimbursable out of pocket expenses will not
exceed $10,000 and its reimbursable legal fees will not exceed $27,500
(excluding out of pocket expenses). Full payment to defray Trident's
reimbursable expenses shall be made in next-day funds on the Closing
Date or, if the Conversion is not completed and is terminated for any
reason, within ten (10) business days of receipt by the Company of a
written request from Trident for reimbursement of its expenses.
Trident acknowledges receipt of $2,000 advance payment from the Bank
which shall be credited against the total reimbursement due Trident
hereunder.
(c) Notwithstanding the limitations on reimbursement of Trident
for allocable expenses provided in the immediately preceding paragraph
(b), in the event that a resolicitation, for a reason other than
failure to obtain sufficient orders to reach the minimum of the
estimated price range established in the Conversion, or other event
causes the Offerings to be extended beyond their original expiration
date, Trident shall be reimbursed for its allocable expenses incurred
during such extended period, provided that the allowance for allocable
expenses provided for in the immediately preceding paragraph (b) above
have been exhausted and subject to the following. Such reimbursement
shall be in amount equal to the product obtained by dividing $10,000
(original out-of-pocket expenses) by the total number of days of the
unextended
Trident Securities, Inc.
Sales Agency Agreement
Page 13
Subscription Offering (calculated from the date of the Prospectus to
the intended close of the Subscription Offering as stated in the
Prospectus) and multiplying such product by the number of days of the
extension (that number of days from the date of the supplemental
prospectus used in the extended Subscription Offering to the closing
of the extension of the Subscription Offering described in such
supplemental prospectus).
The Company shall pay any stock issue and transfer taxes which may be
payable with respect to the sale of the Shares. The Company and the Bank shall
also pay all expenses of the Conversion incurred by them or on their prior
approval including but not limited to their attorneys' fees, NASD filing fees,
and attorneys' fees relating to any required state securities laws research and
filings, telephone charges, air freight, rental equipment, supplies, transfer
agent charges, fees relating to auditing and accounting and costs of printing
all documents necessary in connection with the Conversion.
4. Offering. Subject to the provisions of Section 7 hereof, Trident is
assisting the Company on a best efforts basis in offering a minimum of _______
and a maximum of _______ Shares, with the possibility of offering up to _______
Shares (except as the OTS may permit to be decreased or increased) in the
Subscription and Community Offerings. The Shares are to be offered to the public
at the price set forth on the cover page of the Prospectus and the first page of
this Agreement.
5. Further Agreement. The Company and the Bank jointly and severally
covenant and agree that:
(a) The Company shall deliver to Trident, from time to time, such
number of copies of the Prospectus as Trident reasonably may request.
The Company authorizes Trident to use the Prospectus in any lawful
manner in connection with the offer and sale of the Shares.
(b) The Company will notify Trident immediately upon discovery,
and confirm the notice in writing, (i) when any post-effective
amendment to the Registration Statement becomes effective or any
supplement to the Prospectus has been filed, (ii) of the issuance by
the Conunission of any stop order relating to the Registration
Statement or of the initiation or the threat of any proceedings for
that purpose, (iii) of the receipt of any notice with respect to the
suspension of the qualification of the Shares for offering or sale in
any jurisdiction, and (iv) of the receipt of any comments from the
staff of the Commission relating to the Registration Statement. If the
Commission enters a stop order relating to the Registration Statement
at any time, the Company will make every reasonable effort to obtain
the lifting of such order at the earliest possible moment.
(c) During the time when a prospectus is required to be delivered
under the Act, the Company will comply so far as it is able with all
requirements imposed upon it by the Act, as now in effect and
hereafter amended, and by the SEC Regulations, as from time to the in
Trident Securities, Inc.
Sales Agency Agreement
Page 14
force, so far as necessary to permit the continuance of offers and
sales of or dealings in the Shares in accordance with the provisions
hereof and the Prospectus. If during the period when the Prospectus is
required to be delivered in connection with the offer and sale of the
Shares any event relating to or affecting the Company and the Bank,
taken as a whole, shall occur as a result of which it is necessary, in
the opinion of counsel for Trident, with the concurrence of counsel to
the Company, to amend or supplement the Prospectus in order to make
the Prospectus not false or misleading in light of the circumstances
existing at the time it is delivered to a purchaser of the Shares, the
Company forthwith shall prepare and furnish to Trident a reasonable
number of copies of an amendment or amendments or of a supplement or
supplements to the Prospectus (in form and substance satisfactory to
counsel for Trident) which shall amend or supplement the Prospectus so
that, as amended or supplemented, the Prospectus shall 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 existing at the time the Prospectus is delivered to a
purchaser of the Shares, not misleading. The Company will not file or
use any amendment or supplement to the Registration Statement or the
Prospectus of which Trident has not first been funished a copy or to
which Trident shall reasonably object after having been furnished such
copy. For the purposes of this subsection the Company and the Bank
shall furnish such information with respect to themselves as Trident
from time to time may reasonably request. The Company shall reimburse
Trident for its costs, including legal expenses, in connection with
any amendment or supplement to the Registration Statement or
Prospectus with respect to any event described in this paragraph.
(d) The Company and the Bank have taken or will take all
reasonably necessary action as may be required to qualify or register
the Shares for offer and sale by the Company under the securities or
blue sky laws of such jurisdictions as Trident and either the Company
or its counsel may agree upon; provided, however, that the Company
shall not be obligated to qualify as a foreign corporation to do
business under the laws of any such jurisdiction. In each jurisdiction
where such qualification or registration shall be effected, the
Company, unless Trident agrees that such action is not necessary or
advisable in connection with the distribution of the Shares, shall
file and make such statements or reports as are, or reasonably may be,
required by the laws of such jurisdiction.
(e) Appropriate entries will be made in the financial records of
the Bank sufficient to establish a liquidation account for the benefit
of eligible account holders and supplemental eligible account holders
in accordance with the requirements of the OTS.
(f) The Company will file a registration statement for the Common
Stock under Section 12(g) of the Exchange Act, prior to completion of
the stock offering pursuant to the Plan and shall request that such
registration statement be effective upon completion of the Conversion.
The Company shall maintain the effectiveness of such registration for
a minimum period of three years or for such shorter period as may be
required by applicable law.
Trident Securities, Inc.
Sales Agency Agreement
Page 15
(g) The Company will make generally available to its security
holders as soon as practicable, but not later than 90 days after the
close of the period covered thereby, an earnings statement (in form
complying with the provisions of Rule 158 of the regulations
promulgated under the Act) covering a twelve-month period beginning
not later than the first day of the Company's fiscal quarter next
following the effective date (as defined in said Rule 158) of the
Registration Statement.
(h) For a period of three (3) years from the date of this
Agreement (unless the Common Stock shall have been deregistered under
the Exchange Act), the Company will furnish to Trident, as soon as
publicly available after the end of each fiscal year, a copy of its
annual report to shareholders for such year, and the Company will
furnish to Trident (i) as soon as publicly available, a copy of each
report or definitive proxy statement of the Company filed with the
Commission under the Exchange Act or mailed to shareholders, and (ii)
from time to time, such other public information concerning the
Company as Trident may reasonably request.
(i) The Company shall use the net proceeds from the sale of the
Shares consistently with the manner set forth in the Prospectus.
(j) The Company shall not deliver the Shares until each and every
condition set forth in Section 7 hereof has been satisfied, unless
such condition is waived by Trident.
(k) The Company or its agent (other than Trident) shall advise
Trident, if necessary, as to the allocation of deposits, in the case
of eligible account holders, and votes, in the case of other members,
and of the Shares in the event of an oversubscription and shall
provide Trident final instructions as to the allocation of the Shares
("Allocation Instructions") in such event and such information shall
be accurate and reliable. Trident shall be entitled to rely on such
instructions and shall have no liability in respect of its reliance
thereon, including without limitation, no liability for or related to
any denial or grant of a subscription in whole or in part.
(l) The Company and the Bank will take such actions and furnish
such information as are reasonably requested by Trident in order for
Trident to ensure compliance with the NASD's "Interpretation Relating
to Free-Riding and Withholding."
6. Payment of Expenses. Whether or not the Conversion is consummated,
the Company and the Bank shall pay or reimburse Trident for (a) all filing fees
paid or incurred by Trident in connection with all filings with the NASD with
respect to the Subscription and Community Offerings, and (b) in addition, if the
Company is unable to sell a minimum of _______ Shares or such lesser amount as
the OTS may permit or the Conversion is otherwise terminated, the Company and
the Bank shall reimburse Trident for allocable expenses incurred by Trident
relating to the offering of the Shares as provided in Section 3 hereof,
provided, however, that neither the Company nor the Bank shall pay
Trident Securities, Inc.
Sales Agency Agreement
Page 16
or reimburse Trident for any of the foregoing expenses accrued after Trident
shall have notified the Company or the Bank of its election to terminate this
Agreement pursuant to Section 11 hereof or after such time as the Company or the
Bank shall have given notice in accordance with Section 12 hereof that Trident
is in breach of this Agreement.
7. Conditions of Trident's Obligations. Except as may be waived by
Trident, the obligations of Trident as provided herein shall be subject to the
accuracy of the representations and warranties contained in Section 2 hereof as
of the date hereof and as of the Closing Date, to the performance by the Company
and the Bank of their obligations hereunder and to the following conditions:
(a) At the Closing Date, Trident shall receive the favorable
opinions of Peabody and Xxxxx, special counsel for the Company and the
Bank, dated the Closing Date, addressed to Trident in form and
substance reasonably satisfactory to counsel for Trident and to the
effect that:
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of its
jurisdiction of incorporation, and the Bank is validly existing
as a mutual savings bank in good standing under the laws of the
United States, each with full power and authority to own its
properties and conduct its business as described in the
Prospectus;
(ii) each of the Company and the Bank has been qualified to
do business and, to such counsel's knowledge, is in good standing
as a foreign corporation in each jurisdiction where the ownership
or leasing of its properties or the conduct of its business
requires such qualification or, if not so qualified and in good
standing, failure to so qualify would not have any material
adverse effect on the Company and the Bank, taken as a whole;
(iii) the Bank is a member of the Federal Home Loan Bank of
Pittsburgh, and the deposit accounts of the Bank are insured by
the SAIF up to the applicable legal limits;
(iv) to the knowledge of such counsel, the activities of the
Bank as such activities are described in the Prospectus are
permitted under federal and Delaware law to subsidiaries of a
Delaware business corporation, and the Bank does not have any
subsidiaries;
(v) to the knowledge of such counsel, the Bank has obtained
all licenses, permits and other governmental authorizations
currently required for the conduct of its business as such
business is described in the Prospectus, all such licenses,
permits and other governmental authorizations are in full force
and effect and the Bank is in all
Trident Securities, Inc.
Sales Agency Agreement
Page 17
material respects complying therewith, except where the failure
to hold such licenses, permits or governmental authorizations or
the failure to so comply would not have a material adverse effect
on the Company and the Bank, taken as a whole;
(vi) the Plan complies with, and, to the knowledge of such
counsel, the Conversion of the Bank from a Federally-chartered
mutual savings bank to a Federally-chartered stock savings bank
and the creation of the Company as a holding company for the Bank
have been effected in all material respects in accordance with,
the laws of the State of Delaware and the OTS Regulations (except
for compliance with certain post-closing conditions imposed by
the OTS as to which no opinion need be rendered); to such
counsel's knowledge, all of the terms, conditions, requirements
and provisions with respect to the Plan and the Conversion
imposed by the OTS, except with respect to the filing or
submission of certain required post-Conversion reports or other
materials by the Company or the Bank, have been complied with by
the Company and the Bank, and, to the knowledge of such counsel,
no person has sought to obtain regulatory or judicial review of
the final action of the OTS in approving the Application;
(vii) the Company and Bank have authorized Common Stock as
set forth in the Registration Statement and the Prospectus, and
the description of such Common Stock in the Registration
Statement and the Prospectus is accurate in all material
respects;
(viii) the issuance and sale of the Shares have been duly
and validly authorized by all necessary corporate action on the
part of the Company; the Shares, upon receipt of payment and
issuance in accordance with the terms of the Plan and this
Agreement, will be validly issued, fully paid, nonassessable and
free of preemptive rights, and good title thereto shall be
transferred by the Company free and clear of all claims,
encumbrances, security interests and liens created by the
Company;
(ix) the certificates for the Shares are in proper form and
comply in all material respects with applicable Delaware law;
(x) the issuance and sale of the capital stock of the Bank
to the Company have been duly authorized by all necessary
corporate action of the Bank and the Company and have received
the approval of the OTS, and such capital stock, upon receipt of
payment and issuance in accordance with the terms of the Plan,
will be validly issued, fully paid and nonassessable and owned of
record and, to the knowledge of such counsel, beneficially by the
Company;
(xi) subject to the satisfaction of the conditions to the
OTS's approval of the Application, no further approval,
authorization, consent or other order of any federal
Trident Securities, Inc.
Sales Agency Agreement
Page 18
banking or securities agency or the OTS or any other public
Delaware board or body is required in connection with the
execution and delivery of this Agreement, the issuance of the
Shares and the consummation of the Conversion, except with
respect to the issuance to the Bank of the Stock Charter by the
OTS and as may be required under the "blue sky" laws of various
jurisdictions,
(xii) the execution and delivery of this Agreement and the
consummation of the Conversion have been duly and validly
authorized by all necessary corporate action on the part of each
of the Company and the Bank, and this Agreement is a legal, valid
and binding obligation of each of the Company and the Bank,
enforceable in accordance with its terms (except as the
enforceability thereof may be limited by bankruptcy, insolvency,
moratorium, reorganization, receivership, conservatorship or
similar laws relating to or affecting the enforcement of
creditors' rights generally or the rights of creditors of
depository institutions whose accounts are insured by the FDIC or
depository institution holding companies the accounts of whose
subsidiaries are insured by the FDIC or by general equity
principles, regardless of whether such enforceability is
considered in a proceeding in equity or at law, or by laws
relating to the safety and soundness of insured depository
institutions and their affiliates, and except to the extent that
the provisions of Sections 8 and 9 hereof may be unenforceable as
against public policy or applicable law, including but not
limited to Section 23A, as to which no opinion need be rendered);
(xiii) to such counsel's knowledge, there are no material
legal or governmental proceedings pending or threatened against
or involving the assets of the Company or the Bank (provided that
for this purpose such counsel need not regard any litigation or
governmental procedure to be "threatened" unless the potential
litigant or government authority has manifested to the management
of the Company or the Bank, or to such counsel, a present
intention to initiate such litigation or proceeding);
(xiv) the statements in the Prospectus under the captions
"Regulation," "Taxation," "Dividend Policy," "Restrictions on
Acquisition of the Company" and "Description of Capital Stock of
the Company," insofar as they are, or refer to, statements of law
or legal conclusions (excluding financial data included therein,
as to which an opinion need not be expressed), have been prepared
or reviewed by such counsel and are correct in all material
respects;
(xv) the Application has been approved by the OTS, and the
Prospectus and the Proxy Statement have been authorized for use
by the OTS; the Registration Statement and any post-effective
amendment thereto has been declared effective by the Commission;
except as to any necessary qualifications or registration under
the securities laws of the jurisdictions in which the Shares were
offered, no further approval of any governmental authority is
required for the issuance and sale of the
Trident Securities, Inc.
Sales Agency Agreement
Page 19
Shares (subject to the satisfaction of various conditions
subsequent imposed by the OTS in connection with its approval of
the Application, and no proceedings are pending by or before the
Commission or the OTS seeking to revoke or rescind the orders
declaring the Registration Statement effective, approving the
Application, or, to the knowledge of such counsel are
contemplated or threatened;
(xvi) the execution and delivery of this Agreement and the
consummation of the Conversion by the Company and the Bank do not
conflict with or result in a breach of the articles of
incorporation or bylaws of the Company or the Bank (in either
mutual or stock form), or, to the best knowledge of such
counsel, constitute a material breach of or default (or an event
which, with notice or lapse of time or both, would constitute a
default) under, give rise to any right of termination,
cancellation or acceleration contained in, or result in the
creation or imposition of any lien, charge or other encumbrance
upon any of the properties or assets of the Company or the Bank
pursuant to any of the terms, provisions or conditions of, any
material agreement, contract, indenture, bond, debenture, note,
instrument or obligation to which the Company or the Bank is a
party (other than the establishment of the liquidation account
pursuant to the Plan) or violate any governmental license or
permit or any enforceable published law, administrative
regulation or order or court order, writ, injunction or decree
(subject to the satisfaction of certain conditions imposed by the
OTS in connection with its approval of the Application), which
breach, default, encumbrance or violation would have a material
adverse effect on the condition (financial or otherwise),
operations, business, assets or properties of the Company and the
Bank taken as a whole,
(xvii) to the knowledge of such counsel, there has been no
material breach of any provision of the Company's or the Bank's
articles of incorporation or charter or bylaws or breach or
default (or the occurrence of any event which, with notice or
lapse of time or both, would constitute a default) under any
agreement, contract, indenture, bond, debenture, note, instrument
or obligation to which the Company or the Bank is a party or by
which either of them or any of their respective assets or
properties may be bound or is subject, or violation of any
governmental license or permit, or a violation of any enforceable
published law, administrative regulation or order, or court
order, writ, injunction or decree which breach, default
encumbrance or violation would have a material adverse effect on
the condition (financial or otherwise), operations, business,
assets or properties of the Company and the Bank taken as a
whole; and,
(xviii) the Application, the Registration Statement, the
Prospectus and the Proxy Statement, in each case as amended,
comply as to form in all material respects with the requirements
of the Act, the HOLA, the SEC Regulations, and the OTS
Regulations, as the case may be (except as to information with
respect to Trident included therein and financial statements,
notes to financial statements, financial tables
Trident Securities, Inc.
Sales Agency Agreement
Page 20
and other financial and statistical data, including the appraisal
and related stock valuation information, included therein, as to
which an opinion need not be expressed); to such counsel's
knowledge, all documents and exhibits required to be filed with
the Application, and the Registration Statement have been so
filed, and the descriptions in the Application and the Regisntion
Statement of such documents and exhibits are accurate in all
material respects.
In rendering such opinions, such counsel may rely as to matters
of fact on certificates of officers and directors of the Company and
the Bank and certificates of public officials delivered pursuant
hereto. Such counsel may assume that any agreement is the valid and
binding obligation of any parties to such agreement other than the
Company and the Bank. Such opinions may be governed by, and
interpreted in accordance with, the Legal Opinion Accord (the
"Accord") of the ABA Section of Business Law (1991), and, as a
consequence, references in such opinions to such counsel's "knowledge"
may be limited to "actual knowledge" as defined in the Accord (or
knowledge based on certificates). Such opinions may be limited to
present statutes, regulations and judicial interpretations and to
facts as they presently exist; in rendering such opinions, such
counsel need assume no obligation to revise or supplement them should
the present laws be changed by legislative or regulatory action,
judicial decision or otherwise; and such counsel need express no view,
opinion or belief with respect to whether any proposed or pending
legislation, if enacted, or any regulations or any policy statements
issued by any regulatory agency, whether or not promulgated pursuant
to any such legislation, would affect the validity of the execution
and delivery by the Company and the Bank of this Agreement or the
issuance of the Shares.
(b) At the Closing Date, Trident shall receive the letters of
Peabody and Xxxxx, special counsel for the Company and the Bank, dated
the Closing Date, addressed to Trident, in form and substance
reasonably satisfactory to counsel for Trident and to the effect that
based on such counsel's participation in conferences with
representatives of the Company, the Bank, its counsel, the independent
appraiser, the independent certified public accountants, Trident and
its counsel, review of documents and understanding of applicable law
(including the requirements of Form SB-2) and the experience such
counsel has gained in its practice under the Act, nothing has come to
such counsel's attention that would lead it to believe that the
Registration Statement, as amended (except as to information in
respect of Trident contained therein and except as to the financial
statements, notes to financial statements, financial tables and other
financial and statistical data and stock valuation information
contained therein, as to which such counsel need express no comment),
at the time it became effective contained any untrue statement of a
material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements made therein not
misleading, or that the Prospectus, as amended (except as to
information in respect of Trident contained therein and except as to
financial statements, notes to financial statements, financial tables
and other financial and statistical data and stock valuation
information contained therein as to which such counsel need express no
comment), as of its date and at the Closing Date, contained any untrue
Trident Securities, Inc.
Sales Agency Agreement
Page 21
statement of a material fact or omitted 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 (in making
this statement such counsel may state that it has not undertaken to
verify independently the information in the Registration Statement or
Prospectus and, therefore, does not assume any responsibility for the
accuracy or completeness thereof).
(c) Counsel for Trident shall have been furnished such documents
as they reasonably may require for the purpose of enabling them to
review or pass upon the matters required by Trident, and for the
purpose of evidencing the accuracy, completeness or satisfaction of
any of the representations, warranties or conditions herein contained,
including but not limited to, resolutions of the Board of Directors of
the Company and the Bank regarding the authorization of this Agreement
and the transactions contemplated hereby.
(d) Prior to and at the Closing Date, in the reasonable opinion
of Trident, (i) there shall have been no material adverse change in
the condition, financial or otherwise, business or results of
operations of the Company and the Bank, taken as a whole, since the
latest date as of which such condition is set forth in the Prospectus,
except as referred to therein; (ii) there shall have been no
transaction entered into by the Company or the Bank after the latest
date as of which the financial condition of the Company or the Bank is
set forth in the Prospectus other than transactions referred to or
contemplated therein, transactions in the ordinary course of business,
and transactions which are not material to the Company and the Bank,
taken as a whole; (iii) none of the Company or the Bank shall have
received from the OTS, the FDIC or the Commission any directive (oral
or written) to make any change in the method of conducting their
respective businesses which is material to the business of the Company
and the Bank, taken as a whole, with which they have not complied;
(iv) 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 threatened against the Company or the Bank
or affecting any of their respective assets, wherein an unfavorable
decision, ruling or finding would have a material adverse effect on
the business, operations, financial condition or income of the Company
and the Bank, taken as a whole; and (v) the Shares shall have been
qualified or registered for offering and sale by the Company under the
securities or blue sky laws of such jurisdictions as Trident and the
Company shall have agreed upon.
(e) At the Closing Date, Trident shall receive a certificate of
the principal executive officer and the principal financial officer of
each of the Company and the Bank, dated the Closing Date, to the
effect that: (i) they have examined the Prospectus and, at the time
the Prospectus became authorized by the Company for 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 with respect to the Company or the Bank;
(ii) since the date the Prospectus became authorized by the Company
for use, no event has occurred which should have been set forth in an
amendment or supplement to the Prospectus which has not been so set
forth, including
Trident Securities, Inc.
Sales Agency Agreement
Page 22
specifically, but without limitation, any material change in the
business, condition (financial or otherwise) or results of operations
of the Company or the Bank and, the conditions set forth in clauses
(ii) through (iv) inclusive of subsection (d) of this Section 7 have
been satisfied; (iii) to the best knowledge of such officers, no order
has been issued by the Commission or the OTS to suspend the
Subscription Offering or the Community Offering or the effectiveness
of the Prospectus, and no action for such purposes has been instituted
or threatened by the Commission or the OTS; (iv) to the best knowledge
of such officers, no person has sought to obtain review of the final
actions of the OTS approving the Plan; and (v) all of the
representations and warranties contained in Section 2 of this
Agreement are true and correct, with the same force and effect as
though expressly made on the Closing Date.
(f) At the Closing Date, Trident shall receive, among other
documents, (i) copies of the letters from the OTS authorizing the use
of the Prospectus and the Proxy Statement, (ii) a copy of the order of
the Commission declaring the Registration Statement effective; (iii)
copies of the letters from the OTS evidencing the corporate existence
of the Bank; (iv) a copy of the letter from the appropriate Delaware
authority evidencing the incorporation (and, if generally available
from such authority, good standing) of the Company; (v) a copy of the
Company's articles of incorporation certified by the appropriate
Delaware governmental authority; and, (vi) if available, a copy of the
letter from the OTS approving the Banks Stock Charter.
(g) As soon as available after the Closing Date, Trident shall
receive a certified copy of the Bank's Stock Charter executed by the
an appropriate official of the OTS.
(h) Concurrently with the execution of this Agreement, Trident
acknowledges receipt of a letter from Deloitte & Touche LLP,
independent certified public accountants, addressed to Trident and the
Company, in substance and form satisfactory to counsel for Trident,
with respect to the financial statements and certain financial
information contained in the Prospectus.
(i) At the Closing Date, Trident shall receive a letter in form
and substance satisfactory to counsel for Trident from Deloitte and
Touche LLP, independent certified public accountants, dated the
Closing Date and addressed to Trident and the Company, confirming the
statements made by them in the letter delivered by them pursuant to
the preceding subsection as of a specified date not more than five (5)
days prior to the Closing Date.
All such opinions, certificates, letters and documents shall be in
compliance with the provisions hereof only if they are, in the reasonable
opinion of Trident and its counsel, satisfactory to Trident and its counsel. Any
certificates signed by an officer or director of the Company or the Bank
prepared for Trident's reliance and delivered to Trident or to counsel for
Trident shall be deemed a representation and warranty by the Company and the
Bank to Trident as to the statements made therein. If any condition to Trident's
obligations hereunder to be fulfilled prior to or at the Closing Date is not so
Trident Securities, Inc.
Sales Agency Agreement
Page 23
fulfilled, Trident may terminate this Agreement or, if Trident so elects, may
waive any such conditions which have not been fulfilled, or may extend the time
of their fulfillment. If Trident terminates this Agreement as aforesaid, the
Company and the Bank shall reimburse Trident for its expenses as provided in
Section 3(b) hereof
8. Indemnification.
(a) The Company and the Bank jointly and severally agree to
indemnify and hold harmless Trident, its officers, directors and
employees and each person, if any, who controls Trident within the
meaning of Section 15 of the Act or Section 20(a) of the Exchange Act,
against any and all loss, liability, claim, damage and expense
whatsoever and shall further promptly reimburse such persons for any
legal or other expenses reasonably incurred by each or any of them in
investigating, preparing to defend or defending against any such
action, proceeding or claim (whether commenced or threatened) arising
out of or based upon (A) any untrue or alleged untrue statement of a
material fact or the omission or alleged omission of a material fact
required to be stated or necessary to make the statements, in light of
the circumstances under which they were made, not misleading,
contained in (i) the Registration Statement or the Prospectus or (ii)
any application (including the Application) or other document or
communication (in this Section 8 collectively called "Applications")
prepared or executed by or on behalf of the Company or the Bank or
based upon written information furnished by or on behalf of the
Company or the Bank, filed in any jurisdiction, to effect the
Conversion or qualify the Shares under the securities laws thereof or
filed with the OTS or the Commission with respect to the Conversion,
unless such statement or omission was made in reliance upon and in
conformity with written information furnished to the Company or the
Bank with respect to Trident by or on behalf of Trident expressly for
use in the Prospectus or any amendment or supplement thereof or in any
of the Applications, as the case may be, or (B) the participation by
Trident in the Conversion. This indemnity shall be in addition to any
liability the Company and the Bank may have to Trident otherwise. This
indemnity shall not be applicable with respect to any loss, liability,
claim damage or expense whatsoever if it is determined by final
judgment of a court having jurisdiction over the matter that such
loss, liability, claim, damage or expense was primarily the result of
Trident's willful misconduct or gross negligence.
(b) The Company shall indemnify and hold Trident harmless for any
liability whatsoever arising out of (i) the Allocation Instructions or
(ii) any records of account holders, depositors, borrowers and other
members of the Bank delivered to Trident by the Bank or its agents for
use during the Conversion.
(c) Trident agrees to indemnify and hold harmless the Company and
the Bank, their officers, directors and employees and each person, if
any, who controls the Company and the Bank within the meaning of
Section 15 of the Act or Section 20(a) of the Exchange Act, to the
same extent as the foregoing indemnity from the Company and the Bank
to Trident, but
Trident Securities, Inc.
Sales Agency Agreement
Page 24
only with respect to (A) statements or omissions, if any, made in the
Prospectus or any amendment or supplement thereof, in any Application
or to a purchaser of the Shares in reliance upon, and in conformity
with, written information furnished to the Company or the Bank with
respect to Trident by or on behalf of Trident expressly for use in the
Prospectus or in any of the Applications, or (B) any liability of the
Company or the Bank which is found in a final judgment by a court of
competent jurisdiction (not subject to further appeal) to have
primarily resulted from gross negligence or willful misconduct of
Trident.
(d) Promptly after receipt by an indemnified party under this
Section 8 of notice of the commencement of any action, such
indemnified party will, if a claim in respect thereof is to be made
against the indemnifying party under this Section 8, notify the
indemnifying party of the commencement thereof, but the omission so to
notify the indemnifying party will not relieve it from any liability
which it may have to any indemnified party otherwise than under this
Section 8. In case any such action is brought against any indemnified
party, and it notifies the indemnifying party of the commencement
thereof, the indemnifying party will be entitled to participate
therein and, to the extent that it may wish, jointly with the other
indemnifying party similarly notified, to assume the defense thereof,
with counsel satisfactory to such indemnified party, and after notice
from the indemnifying party to such indemnified party of its election
so to assume the defense thereof, the indemnifying party will not be
liable to such indemnified party under this Section 8 for any legal or
other expenses subsequently incurred by such indemnified party in
connection with the defense thereof other than the reasonable cost of
investigation except as otherwise provided herein. In the event the
indemnifying party elects to assume the defense of any such action and
retain counsel acceptable to the indemnified party, the indemnified
party may retain additional counsel, but shall bear the fees and
expenses of such counsel unless (i) the indemnifying party shall have
specifically authorized the indemnified party to retain such counsel
or (ii) the parties to such suit include such indemnifying party and
the indemnified party, and such indemnified party shall have been
advised by counsel that one or more material legal defenses may be
available to the indemnified party which may not be available to the
indemnifying party, in which case the indemnifying party shall not be
entitled to assume the defense of such suit notwithstanding the
indemnifying party's obligation to bear the fees and expenses of such
counsel. An indemnifying party against whom indemnity may be sought
shall not be liable to indemnify an indemnified party under this
Section 8 if any settlement of any such action is effected without
such indemnifying party's consent. In no event shall the indemnifying
parties be liable for the fees and expenses of more than one separate
firm of attorneys for each indemnified party in connection with any
one action, proceeding, claim or suit or separate but similar or
related actions, proceedings or claims in the same jurisdiction
arising out of the same general allegations or circumstances unless
such indemnified parties receive an opinion of counsel that they need
separate representation because of potential conflicts of interest
between such indemnified parties or because some indemnified parties
have claims or defenses which are not shared by other indemnified
parties. To the extent required by law, this Section 8 is subject to
and limited by the provisions of Section 23A.
Trident Securities, Inc.
Sales Agency Agreement
Page 25
9. Contribution. In order to provide for just and equitable
contribution in circumstances in which the indemnity agreement provided for in
Section 8 above is for any reason held to be unavailable to Trident, the Company
and/or the Bank other than in accordance with its terms, the Company or the Bank
and Trident shall contribute to the aggregate losses, liabilities, claims,
damages, and expenses of the nature contemplated by said indemnity agreement
incurred by the Company or the Bank and Trident (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company and the
Bank on the one hand and Trident on the other from the offering of the Shares or
(ii) if the allocation provided by clause (i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above, but also the relative fault
of the Company or the Bank on the one hand and Trident on the other hand in
connection with the statements or omissions which resulted in such losses, claim
damages, liabilities or judgments, as well as any other relevant equitable
considerations. The relative benefits received by the Company and the Bank on
the one hand and Trident on the other shall be deemed to be in the same
proportions as the total net proceeds from the Conversion received by the
Company and the Bank bear to the total fees received by Trident under this
Agreement. The relative fault of the Company or the Bank on the one hand and
Trident on the other 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 or the Bank or by Trident and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission.
The Company and the Bank and Trident agree that it would not be just
and equitable if contribution pursuant to this Section 9 were determined by pro
rata allocation or by any other method of allocation which does not take account
of the equitable considerations referred to in the immediately preceding
paragraph. The amount paid or payable by an indemnified party as a result of the
losses, claims, damages, liabilities or judgments referred to in the immediately
preceding paragraph shall be deemed to include, subject to the limitations set
forth above, any legal or other expenses reasonably incurred by the indemnified
party in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 9, Trident shall not be required
to contribute any amount in excess of the amount by which fees owed Trident
pursuant to this Agreement exceeds the amount of any damages which Trident has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who is not guilty of such fraudulent
misrepresentation. To the extent required by law, this Section 9 is subject to
and limited by public policy and applicable law, including but not limited to
the provisions of Section 23A.
10. Survival of Agreements, Representations and Indemnities. The
respective indemnities of the Company and the Bank and Trident and the
representation and warranties of the Company and the Bank and of Trident set
forth in or made pursuant to this Agreement shall remain in full force and
effect, regardless of any termination or cancellation of this Agreement or any
investigation made by or
Trident Securities, Inc.
Sales Agency Agreement
Page 26
on behalf of Trident or the Company or the Bank or any controlling person or
indemnified party referred to in Section 8 hereof, and shall survive any
termination or consummation of this Agreement and/or the issuance of the Shares,
and any legal representative of Trident, the Company, the Bank and any such
controlling persons shall be entitled to the benefit of the respective
agreements, indemnities, warranties and representations.
11. Termination. Trident may terminate this Agreement by giving the
notice indicated below in this Section at any time after this Agreement becomes
effective as follows:
(a) If any domestic or international event or act or occurrence
has materially disrupted the United States securities markets such as
to make it, in Trident's reasonable opinion, impracticable to proceed
with the offering of the Shares; or if trading on the New York Stock
Exchange shall have suspended; or if the United States shall have
become involved in a war or major hostilities; or if a general banking
moratorium has been declared by a state or federal authority which has
material effect on the Bank or the Conversion, or if a moratorium in
foreign exchange trading by major international banks or persons has
been declared; or if there shall have been a material adverse change
in the capitalization, condition or business or prospects of the
Company, or if the Bank shall have sustained a material or substantial
loss by fire, flood, accident, hurricane, earthquake, theft, sabotage
or other calamity or malicious act, whether or not said loss shall
have been insured.
(b) If Trident elects to terminate this Agreement as provided in
this Section, the Company and the Bank shall be notified promptly by
Trident by telephone or telegram, confirmed by letter.
(c) If this Agreement is terminated by Trident for any of the
reasons set forth in subsection (a) above, and to fulfill its
obligations, if any, pursuant to Sections 3(b), 3(c), 6, 8(a) and 9 of
this Agreement and upon demand, the Company and the Bank shall pay
Trident the full amount so owing thereunder.
(d) The Bank may terminate the Conversion in accordance with the
terms of the Plan. Such termination shall be without liability to any
party, except that the Company and the Bank shall be required to
fulfill their obligations pursuant to Sections 3(b), 3(c), 6, 8(a) and
9 of this Agreement.
12. Notices. All communications hereunder, except as herein otherwise
specifically provided, shall be in writing and if sent to Trident shall be
mailed, delivered or telegraphed and confirmed to Trident Securities, Inc., 0000
Xxx Xxxxx Xxxx, Xxxxx 000, Xxxxxxx, Xxxxx Xxxxxxxx 00000, Attention: Mr. R. Xxx
Xxxxxxx, Xx. (with a copy to Elias, Matz, Xxxxxxx & Xxxxxxx, LLP, 000 00xx
Xxxxxx, X.X., Xxxxxxxxxx, XX 00000, Attention: Xxxxxxx X. Xxx, Esquire) and if
sent to the Company or the Bank, shall be mailed, delivered or telegraphed and
confirmed to Delaware First Financial Corporation, Ninth Xxxx Savings Bank, 000
Xxxxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx
Trident Securities, Inc.
Sales Agency Agreement
Page 27
19801, Attention: Xx. Xxxxxx X. Xxxxxx, President (with a copy to Peabody &
Xxxxx, 0000 00xx Xxxxxx, X.X., Xxxxx 000, Xxxxxxxxxx, X.X. 00000, Attention:
Xxxxxxx X. Xxxxxxx, Esquire).
13. Parties. This Agreement shall inure solely to the benefit of, and
shall be binding upon, Trident, the Company, the Bank and the controlling and
other persons referred to in Section 8 hereof, and their respective successors,
legal representatives and assigns, and no other person shall have or be
construed to have any legal or equitable right, remedy or claim under or in
respect of or by virtue of this Agreement or any provision herein contained.
14. Construction. Unless governed by preemptive federal law, this
Agreement shall be governed by and construed in accordance with the substantive
laws of North Carolina.
15. Counterparts. This Agreement may be executed in separate
counterparts, each of which when so executed and delivered shall be an original,
but all of which together shall constitute but one and the same instrument.
Please acknowledge your agreement to the foregoing by signing below and
returning to the Company one copy of this letter.
DELAWARE FIRST FINANCIAL CORPORATION
By:________________
Xxxxxx X. Xxxxxx
President and Chief
Executive Officer
Date:______________
NINTH XXXX SAVINGS BANK, FSB
By:________________
Xxxxxx X. Xxxxxx
President and Chief
Executive Officer
Date:______________
Agreed to and accepted:
TRIDENT SECURITIES, INC.
Trident Securities, Inc.
Sales Agency Agreement
Page 28
By:__________________
Date:________________
Exhibit A
Trident Securities, Inc. is a registered selling agent in the jurisdictions
listed below:
Alabama Missouri
Arizona Nebraska
Arkansas Nevada
California New Hampshire
Colorado New Jersey
Connecticut New Mexico
Delaware New York
District of Columbia North Carolina
Florida North Dakota (Trident Securities, Inc. only,
no agents)
Georgia Ohio
Idaho Oklahoma
Illinois Oregon
Indiana Pennsylvania
Iowa Rhode Island
Kansas South Carolina
Kentucky Tennessee
Delaware Texas
Maine Vermont
Maryland Virginia
Massachusetts Washington
Michigan West Virginia
Minnesota Wisconsin
Mississippi Wyoming
Trident Securities, Inc. is not a registered selling agent in the jurisdictions
listed below:
Alaska
Hawaii
Montana
South Dakota
Utah
