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EXHIBIT 1.2
HOME CITY FINANCIAL CORPORATION
828,000 Shares
COMMON STOCK
(No Par Value)
Subscription Price $10.00 Per Share
AGENCY AGREEMENT
_______ __, 1996
Xxxxxxx Xxxx & Company, a division of
Xxxxx, Xxxxxxxx & Xxxxx, Inc.
000 Xxxxxxxxx Xxxxx
Xxxxxx, Xxxx 00000-0000
Ladies and Gentlemen:
Home City Financial Corporation, an Ohio corporation (the "Company")
and Home City Federal Savings Bank of Springfield, Springfield, Ohio, a
federally chartered mutual savings bank (references to the "Bank" include the
Bank in the mutual or stock form, as indicated by the context), with its deposit
accounts insured by the Savings Association Insurance Fund ("SAIF") administered
by the Federal Deposit Insurance Corporation ("FDIC")), hereby confirm their
agreement with Xxxxxxx Xxxx & Company, a division of Xxxxx, Xxxxxxxx & Xxxxx,
Inc. ("Xxxx") or (the "Agent"), as follows:
SECTION 1. THE OFFERING. The Bank, in accordance with its plan of
conversion adopted by its Board of Directors (the "Plan"), intends to convert
from a federally chartered mutual savings bank to a federally chartered stock
savings bank, and will issue all of its issued and outstanding capital stock to
the Company. In addition, pursuant to the Plan, the Company will offer and sell
up to 828,000 shares of its common stock, no par value per share (the "Shares"
or "Common Stock"), in a subscription offering (the "Subscription Offering") to
(1) depositors of the Bank with Qualifying Deposits (as defined in the Bank's
Plan of Conversion) as of June 30, 1995 ("Eligible Account Holders"), (2) the
Bank's tax-qualified employee plans ("TQEPs"), (3) depositors of the Bank with
Qualifying Deposits as of September 30, 1996 ("Supplemental Eligible Account
Holders"), (4) the Bank's Other Eligible Members (as defined in the Bank's Plan
of Conversion) and (5) employees, officers and directors of the Bank. Subject to
the prior subscription rights of the above-listed parties, the Company is
offering for sale in a community offering (the "Community Offering" and when
referred to together with the Subscription Offering, the "Subscription and
Community Offering") conducted concurrently with the Subscription Offering, the
Shares not so subscribed for or ordered in the Subscription Offering to members
of the general public to whom a copy of the Prospectus (as hereinafter defined)
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delivered ("Other Subscribers") (all such offerees being referred to in the
aggregate as "Eligible Offerees"). It is anticipated that shares not subscribed
for in the Subscription and Community Offering will be offered to certain
members of the general public on a best efforts basis through a selected dealers
arrangement (the "Syndicated Community Offering") (the Subscription Offering,
Community Offering and Syndicated Community Offering are collectively referred
to as the "Offering"). It is acknowledged that the purchase of Shares in the
Offering is subject to the maximum and minimum purchase limitations as described
in the Plan and that the Company and the Bank may reject, in whole or in part,
any orders received in the Community Offering or Syndicated Community Offering.
Collectively, these transactions are referred to herein as the "Conversion."
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-1 (File No. ________) (the
"Registration Statement") containing a prospectus relating to the Offering for
the registration of the Shares under the Securities Act of 1933 (the "1933
Act"), and has filed such amendments thereof and such amended prospectuses as
may have been required to the date hereof. The term "Registration Statement"
shall include any documents incorporated by reference therein and all financial
schedules and exhibits thereto, as amended, including post-effective amendments.
The prospectus, as amended, on file with the Commission at the time the
Registration Statement initially became effective is hereinafter called the
"Prospectus," except that if any Prospectus is filed by the Company pursuant to
Rule 424(b) or (c) of the rules and regulations of the Commission under the 1933
Act (the "1933 Act Regulations") differing from the prospectus on file at the
time the Registration Statement initially becomes effective, the term
"Prospectus" shall refer to the prospectus filed pursuant to Rule 424(b) or (c)
from and after the time said prospectus is filed with the Commission.
In accordance with Title 12, Part 563b of the Code of Federal
Regulations (the "Conversion Regulations"), the Bank has filed with the Office
of Thrift Supervision (the "OTS") an Application for Approval of Conversion on
Form AC (the "Conversion Application"), including the Prospectus and the
Conversion Valuation Appraisal Report prepared by Xxxxxx & Company (the
"Appraisal") and has filed such amendments thereto as may have been required by
the OTS. The Conversion Application has been approved by the OTS and the related
Prospectus has been authorized for use by the OTS. In addition, the Company has
filed with the OTS its application on Form H-(e)1-S (the "Holding Company
Application") to become a registered savings and loan holding company under the
Home Owners' Loan Act, as amended ("HOLA"); and it has been approved.
SECTION 2. RETENTION OF AGENT; COMPENSATION; SALE AND DELIVERY OF THE
SHARES. Subject to the terms and conditions herein set forth, the Company and
the Bank hereby appoint Xxxx as their exclusive financial advisor and marketing
agent (i) to utilize its best efforts to solicit subscriptions for Shares of the
Company's Common Stock and to advise and assist the Company and the Bank with
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respect to the Company's sale of the Shares in the Offering and (ii) to
participate in the Offering in the areas of market making, research coverage and
in syndicate formation (if necessary).
On the basis of the representations, warranties, and agreements herein
contained, but subject to the terms and conditions herein set forth, the Agent
accepts such appointment and agrees to consult with and advise the Company and
the Bank as to the matters set forth in the letter agreement ("Letter
Agreement"), dated August 2, 1996 between the Bank and Xxxx (a copy of which is
attached hereto as Exhibit A). It is acknowledged by the Company and the Bank
that the Agent shall not be required to purchase any Shares or be obligated to
take any action which is inconsistent with all applicable laws, regulations,
decisions or orders.
The obligations of the Agent pursuant to this Agreement (other than
those set forth in Sections 2(d) and (e) hereof) shall terminate upon the
completion or termination or abandonment of the Plan by the Company or upon
termination of the Offering, but in no event later than 45 days after the
completion of the Subscription Offering (the "End Date"). All fees or expenses
due to the Agent but unpaid will be payable to the Agent in next day funds at
the earlier of the Closing Date (as hereinafter defined) or the End Date. In the
event the Offering is extended beyond the End Date, the Company, the Bank and
the Agent may agree to renew this Agreement under mutually acceptable terms.
In the event the Company is unable to sell a minimum of 612,000 Shares
within the period herein provided, this Agreement shall terminate and the
Company shall refund to any persons who have subscribed for any of the Shares,
the full amount which it may have received from them plus accrued interest as
set forth in the Prospectus; and none of the parties to this Agreement shall
have any obligation to the other parties hereunder, except as set forth in this
Section 2 and in Sections 6, 8 and 9 hereof.
In the event the Offering is terminated for any reason not attributable
to the action or inaction of the Agent, the Agent shall be paid the fees due to
the date of such termination pursuant to subparagraphs (a) and (d) below.
If all conditions precedent to the consummation of the Conversion,
including, without limitation, the sale of all Shares required by the Plan to be
sold, are satisfied, the Company agrees to issue, or have issued, the Shares
sold in the Offering and to release for delivery certificates for such Shares on
the Closing Date (as hereinafter defined) against payment to the Company by any
means authorized by the Plan; provided, however, that no funds shall be released
to the Company until the conditions specified in Section 7 hereof shall have
been complied with to the reasonable satisfaction of the Agent and their
counsel. The release of Shares against payment therefor shall be made at 10:00
a.m., Eastern Time, on a date and at a place acceptable to the Company, the Bank
and the Agent (it being understood that such date shall not be more than 10
business days after the expiration of the Offering) or such
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other time or place as shall be agreed upon by the Company, the Bank and the
Agent. Certificates for shares shall be delivered directly to the purchasers in
accordance with their directions. The date upon which the Company shall release
or deliver the Shares sold in the Offering, in accordance with the terms herein,
is called the "Closing Date."
The Agent shall receive the following compensation for its services
hereunder:
(a) A management fee of $25,000 payable on August 2, 1996. Such
fees shall be deemed to have been earned when due. Should the
Conversion be terminated for any reason not attributable to
the action or inaction of the Agent, the Agent shall have
earned and be entitled to be paid fees accruing through the
stage at which point the termination occurred, including any
accrued legal fees expended by the Agent.
(b) A Success Fee of 1.50% of the aggregate Purchase Price of
Common Stock sold in the Subscription Offering and Community
Offering excluding shares purchased by the Bank's officers,
directors, or employees (or members of their immediate
families) plus any ESOP, tax-qualified or stock based
compensation plans (except IRA's) or similar plan created by
the Bank for some or all of its directors or employees.
(c) If any shares of the Company's stock remain available after
the subscription offering, at the request of the Bank, Xxxx
will seek to form a syndicate of registered broker-dealers to
assist in the sale of such common stock on a best efforts
basis, subject to the terms and conditions set forth in the
selected dealers agreement. Xxxx will endeavor to distribute
the common stock among dealers in a fashion which best meets
the distribution objectives of the Bank and the Plan of
Conversion. Xxxx will be paid a fee not to exceed 5.5% of the
aggregate Purchase Price of the shares of common stock sold by
them. Xxxx will pass onto selected broker-dealers, who assist
in the syndicated community, an amount competitive with gross
underwriting discounts charged at such time for comparable
amounts of stock sold a comparable price per share in a
similar market environment. Fees with respect to purchases
affected with the assistance of a broker/dealer other than
Xxxx shall be transmitted by Xxxx to such broker/dealer. The
decision to utilize selected broker-dealers will be made by
the Bank upon consultation with Xxxx. In the event, with
respect to any stock purchases, fees paid pursuant to this
subparagraph 2(c), such fees shall be in lieu of, and not in
addition to, payment pursuant to subparagraph 2(a) and 2(b).
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(d) The Bank and the Company hereby agree to reimburse the Agent,
from time to time upon the Agent's request, for its reasonable
out-of-pocket expenses, including without limitation,
accounting, legal counsel, and communication, excluding travel
expenses. The Bank will bear the expenses of the Offering
customarily borne by issuers including, without limitation,
OTS, SEC, "Blue Sky," and NASD filings and registration fees;
the fees of the Bank's accountants, conversion agent,
attorneys, appraiser, transfer agent and registrar, printing,
mailing and marketing expenses associated with the conversion;
and the fees set forth under this Section 2.
Full payment of Agent's actual and accountable expenses, advisory fees
and compensation shall be made in next day funds on the earlier of the Closing
Date or a determination by the Bank to terminate or abandon the Plan.
SECTION 3. PROSPECTUS; OFFERING. The Shares are to be
initially offered in the Offering at the Purchase Price as defined
and set forth on the cover page of the Prospectus.
SECTION 4. REPRESENTATIONS AND WARRANTIES. The Company and
the Bank jointly and severally represent and warrant to and agree
with each of the Agent as follows:
(a) The Registration Statement which was prepared by the Company
and the Bank and filed with the Commission was declared
effective by the Commission on __________, 1996. At the time
the Registration Statement, including the Prospectus contained
therein (including any amendment or supplement), became
effective, the Registration Statement contained all statements
that were required to be stated therein in accordance with the
1933 Act and the 1933 Act Regulations, complied in all
material respects with the requirements of the 1933 Act and
the 1933 Act Regulations and the Registration Statement,
including the Prospectus contained therein (including any
amendment or supplement thereto), and any information
regarding the Company or the Bank contained in Sales
Information (as such term is defined in Section 8 hereof)
authorized by the Company or the Bank for use in connection
with the 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 (c) Prospectus
was filed with the Commission and at the Closing Date referred
to in Section 2, the Registration Statement, including the
Prospectus contained therein (including any amendment or
supplement thereto), any information regarding the
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Company or the Bank contained in Sales Information (as such
term is defined in Section 8 hereof) authorized by the Company
or the Bank for use in connection with the Offering will
contain all statements that are required to be stated herein
in accordance with the 1933 Act and the 1933 Act Regulations
and will not contain an untrue statement of a material fact or
omit to state a material fact necessary in order to make the
statements therein, in light of the circumstances under which
they were made, not misleading; provided, however, that the
representations and warranties in this Section 4(a) shall not
apply to statements or omissions made in reliance upon and in
conformity with written information furnished to the Company
or the Bank by the Agent or its counsel expressly regarding
the Agent for use in the Prospectus under the caption "The
Conversion-Marketing Arrangements" or statements in or
omissions from any Sales Information or information filed
pursuant to state securities or blue sky laws or regulations
regarding the Agent.
(b) The Conversion Application was approved by the OTS on
__________, 1996 and the related Prospectus has been
authorized for use by the OTS. At the time of the approval of
the Conversion Application, including the Prospectus
(including any amendment or supplement thereto), by the OTS
and at all times subsequent thereto until the Closing Date,
the Conversion Application, including the Prospectus
(including any amendment or supplement thereto), will comply
in all material respects with the Conversion Regulations
except to the extent waived in writing by the OTS. The
Conversion Application, including the Prospectus (including
any amendment or supplement thereto), does not include any
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; provided, however,
that the representations and warranties in this Section 4(b)
shall not apply to statements or omissions made in reliance
upon and in conformity with written information furnished to
the Company or the Bank by the Agent or its counsel expressly
regarding the Agent for use in the Prospectus contained in the
Conversion Application under the caption "The Conversion-" or
statements in or omissions from any sales information or
information filed pursuant to state securities or blue sky
laws or regulations regarding the Agent. The Holding Company
Application for approval pursuant to the HOLA and the
regulations promulgated thereunder (the
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"Control Act Regulations"), has been prepared by the Bank and
the Company in material conformity with the requirements of
the Control Act Regulations and has been filed with and
approved by the OTS. A conformed copy of the Holding Company
Application has been delivered to the Agent.
(c) The Company has filed with the OTS the Holding Company
Application, and such Application was deemed complete by the
OTS. As of the Closing Date, approval of the Company's
acquisition of the Bank had been obtained from the OTS.
(d) No order has been issued by the OTS or the FDIC (hereinafter
any reference to the FDIC shall include the SAIF) preventing
or suspending the use of the Prospectus, and no action by or
before any such government entity to revoke any approval,
authorization or order of effectiveness related to the
Conversion is, to the best knowledge of the Company or the
Bank, pending or threatened.
(e) At the Closing Date referred to in Section 2, the Plan will
have been adopted by the Boards of Directors of both the
Company and the Bank and approved by the members of the Bank,
and the offer and sale of the Shares will have been conducted
in all material respects in accordance with the Plan, the
Conversion Regulations, and all other applicable laws,
regulations, decisions and orders, including all terms,
conditions, requirements and provisions precedent to the
Conversion imposed upon the Company or the Bank by the OTS,
the Commission, or any other regulatory authority and in the
manner described in the Prospectus. No person has sought to
obtain review of the final action of the OTS in approving the
Plan or in approving the Conversion or the Holding Company
Application pursuant to the HOLA, or any other statute or
regulation.
(f) The Bank has been organized and is a validly existing
federally chartered savings bank in mutual form of
organization and upon the Conversion will become a duly
organized and validly existing federally chartered savings
bank in capital stock form of organization, in both instances
duly authorized to conduct its business and own its property
as described in the Registration Statement and the Prospectus;
the Bank has obtained all material licenses, permits and other
governmental authorizations currently required for the conduct
of its business; all such licenses, permits and governmental
authorizations are in full force and effect, and the Bank is
in all material respects complying with all laws, rules,
regulations and
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orders applicable to the operation of its business; the Bank
is existing under the laws of the federal government and is
duly qualified as a foreign corporation to transact business
and is in good standing in each jurisdiction in which its
ownership of property or leasing of property or the conduct of
its business requires such qualification, unless the failure
to be so qualified in one or more of such jurisdictions would
not have a material adverse effect on the condition, financial
or otherwise, or the business, operations or income of the
Bank. The Bank does not own equity securities or any equity
interest in any other business enterprise except as described
in the Prospectus or as would not be material to the
operations of the Bank. Upon completion of the sale by the
Company of the Shares contemplated by the Prospectus, (i) the
Bank will be converted pursuant to the Plan to a federally
chartered stock savings bank, (ii) all of the authorized and
outstanding capital stock of the Bank will be owned by the
Company, and (iii) the Company will have no direct
subsidiaries other than the Bank. The Conversion will have
been effected in all material respects in accordance with all
applicable statutes, regulations, decisions and orders; and,
except with respect to the filing of certain post-sale,
post-Conversion reports, and documents in compliance with the
1933 Act Regulations, the OTS' resolutions or letters of
approval, all terms, conditions, requirements and provisions
with respect to the Conversion imposed by the Commission, the
OTS, and the FDIC, if any, will have been complied with by the
Company and the Bank in all material respects or appropriate
waivers will have been obtained and all material notice and
waiting periods will have been satisfied, waived or elapsed.
(g) The Company has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the State
of Ohio with corporate power and authority to own, lease and
operate its properties and to conduct its business as
described in the Registration Statement and the Prospectus,
and at the Closing Date the Company will be qualified to do
business as a foreign corporation in each jurisdiction in
which the conduct of its business requires such qualification,
except where the failure to so qualify would not have a
material adverse effect on the condition, financial or
otherwise, or the business, operations or income of the
Company. The Company has obtained all material licenses,
permits and other governmental authorizations currently
required for the conduct
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of its business; all such licenses, permits and governmental
authorizations are in full force and effect, and the Company
is in all material respects complying with all laws, rules,
regulations and orders applicable to the operation of its
business.
(h) The Bank has one wholly owned subsidiary, Homciti Service
Corp, which is duly incorporated and validly existing as a
corporation in good standing under the laws of the State of
Ohio, and is duly licensed and possessed of full corporate
power and authority to own its properties and conduct its
business as described in the Prospectus.
(i) The Bank is a member of the Federal Home Loan Bank of Chicago
("FHLB-Chicago"). The deposit accounts of the Bank are insured
by the FDIC up to the applicable limits; and no proceedings
for the termination or revocation of such insurance are
pending or, to the best knowledge of the Company or the Bank,
threatened. Upon consummation of the Conversion, the
liquidation account for the benefit of Eligible Account
Holders will be duly established in accordance with the
requirements of the Conversion Regulations.
(j) The Company, the Bank and its subsidiaries have good and
marketable title to all real property and other assets
material to the business of the Company and the Bank taken as
a whole and to those properties and assets described in the
Registration Statement and Prospectus as owned by them, free
and clear of all liens, charges, encumbrances or restrictions,
except such as are described in the Registration Statement and
Prospectus, or are not material to the business of the Company
and the Bank taken as a whole; and all of the leases and
subleases material to the business of the Company and the Bank
taken as a whole under which the Company or the Bank hold
properties, including those described in the Registration
Statement and Prospectus, are in full force and effect.
(k) The Company and the Bank have received an opinion of their
special counsel, Vorys, Xxxxx, Xxxxxxx and Xxxxx with respect
to the federal and Ohio state income tax consequences of the
Conversion, the acquisition of the capital stock of the Bank
by the Company and the sale of the Shares as described in the
Registration Statement and the Prospectus, all material
aspects of the opinions of Vorys, Xxxxx, Xxxxxxx and Xxxxx are
accurately summarized in the Prospectus; and the facts and
representations upon which such opinions are based are
truthful, accurate and complete.
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(l) The Company and the Bank have 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 issue and sell the Shares to be sold
by the Company as provided herein and as described in the
Prospectus. The consummation of the Conversion, the execution,
delivery and performance of this Agreement and the
consummation of the transactions herein contemplated have been
duly and validly authorized by all necessary corporate action
on the part of the Company and the Bank and this Agreement has
been validly executed and delivered by the Company and the
Bank and is the valid, legal and binding agreement 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 or similar
laws relating to or affecting the enforcement of creditors'
rights generally or the rights of creditors of savings and
loan 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 if any, that the
provisions of Sections 8 and 9 hereof may be unenforceable as
against public policy).
(m) The Company and the Bank are not in violation of any directive
received from the OTS, the FDIC, or any other agency to make
any material change in the method of conducting their
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, and the FDIC) and, except as may be set forth in the
Registration Statement and the Prospectus, there is no suit or
proceeding or charge or action before or by any court,
regulatory authority or governmental agency or body, pending
or, to the knowledge of the Company or the Bank, threatened,
which might materially and adversely affect the Conversion,
the performance of this Agreement or the consummation of the
transactions contemplated in the Plan and as described in the
Registration Statement and the Prospectus or which might
result in any material adverse change in the condition
(financial or otherwise), earnings, capital or properties of
the Company or the Bank, or which would materially affect
their properties and assets.
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(n) The financial statements, schedules and notes related thereto
which are included in the Prospectus fairly present the
consolidated financial condition, results of operations,
retained earnings and cash flows of the Bank at the respective
dates indicated and for the respective periods covered thereby
and comply as to form in all material respects with the
applicable accounting requirements of Title 12 of the Code of
Federal Regulations and generally accepted accounting
principles (including those requiring the recording of certain
assets at their current market value). Such financial
statements, schedules and notes related thereto have been
prepared in accordance with generally accepted accounting
principles consistently applied through the periods involved,
present fairly in all material respects the information
required to be stated therein and are consistent with the most
recent financial statements and other reports filed by the
Bank with the OTS. The other financial, statistical and pro
forma information and related notes included in the Prospectus
present fairly the information shown therein on a basis
consistent with the audited and unaudited financial statements
of the Bank included in the Prospectus, and as to the pro
forma adjustments, the adjustments made therein have been
properly applied on the basis described therein.
(o) Since the respective dates as of which information is given in
the Registration Statement including the Prospectus: (i) there
has not been any material adverse change, financial or
otherwise, in the condition of the Company or the Bank and its
subsidiaries considered as one enterprise, or in the earnings,
capital or properties of the Company or the Bank, whether or
not arising in the ordinary course of business; (ii) there has
not been any material increase in the long-term debt of the
Bank or in the principal amount of the Bank's assets which are
classified by the Bank as substandard, doubtful or loss or in
loans past due 90 days or more or real estate acquired by
foreclosure, by deed-in-lieu of foreclosure or deemed
in-substance foreclosure or any material decrease in retained
earnings or total assets of the Bank nor has the Company or
the Bank issued any securities (other than in connection with
the incorporation of the Company) or incurred any liability or
obligation for borrowing other than in the ordinary course of
business; (iii) there have not been any material transactions
entered into by the Company or the Bank; (iv) there has not
been any material adverse change in the aggregate dollar
amount of the Bank's
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deposits or its consolidated net worth or spread; (v) there
has been no material adverse change in the Company's or the
Bank's relationship with its insurance carriers, including,
without limitation, cancellation or other termination of the
Company's or the Bank's fidelity bond or any other type of
insurance coverage; (vi) except as disclosed in the Prospectus
there has been no material change in management of the Company
or the Bank, neither of which has any material undisclosed
liability of any kind, contingent or otherwise; (vii) the
Company or the Bank has not sustained any material loss or
interference with its respective business or properties from
fire, flood, windstorm, earthquake, accident or other
calamity, whether or not covered by insurance; (viii) the
Company or the Bank is not in default in the payment of
principal or interest on any outstanding debt obligations;
(ix) the capitalization, liabilities, assets, properties and
business of the Company, the Mutual Holding Company and the
Bank conform in all material respects to the descriptions
thereof contained in the Prospectus; and (x) neither the
Company, the Bank nor its wholly owned subsidiary has any
material contingent liabilities, except as set forth in the
Prospectus. All documents made available to or delivered or to
be made available to or delivered by the Bank or the Company
or their representatives in connection with the issuance and
sale of the Shares, including records of account holders,
depositors, borrowers and other members of the Bank, or in
connection with the Agent's exercise of due diligence, except
for those documents which were prepared by parties other than
the Bank, the Company or their representatives, to the best
knowledge of the Bank and the Company, were on the dates on
which they were delivered, or will be on the dates on which
they are to be delivered, true, complete and correct in all
material respects.
(p) As of the date hereof and as of the Closing Date, neither the
Company, the Bank nor its subsidiary is in violation of its
articles of incorporation or bylaws or charter or bylaws,
respectively (and the Bank will not be in violation of its
charter or bylaws in capital stock form upon consummation of
the Conversion), or in default in the performance or
observance of any material obligation, agreement, covenant, or
condition contained in any material contract, lease, loan
agreement, indenture or other instrument to which it is a
party or by which it or any of its property may be bound; the
consummation of the Conversion, the execution, delivery and
performance of this Agreement and the consummation of the
transactions herein
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contemplated have been duly and validly authorized by all
necessary corporate action on the part of the Company and the
Bank and this Agreement has been validly executed and
delivered by the Company and the Bank and is a valid, legal
and binding Agreement of the Company and the Bank enforceable
in accordance with its terms, except as the enforceability
thereof may be limited by (i) bankruptcy, insolvency,
reorganization, moratorium, conservatorship, receivership or
other similar laws now or hereafter in effect relating to or
affecting the enforcement of creditors' rights generally or
the rights of creditors of federal savings institutions, (ii)
general equitable principles, (iii) laws relating to the
safety and soundness of insured depository institutions, and
(iv) applicable law or public policy with respect to the
indemnification and/or contribution provisions contained
herein, and except that no representation or warranty need be
made as to the effect or availability of equitable remedies or
injunctive relief (regardless of whether such enforceability
is considered in a proceeding in equity or at law). The
consummation of the transactions herein contemplated will not:
(i) conflict with or constitute a breach of, or default under,
or result in the creation of any material lien, charge or
encumbrance (with the exception of the liquidation account
established in the Conversion) upon any of the assets of the
Company or the Bank pursuant to the articles of incorporation
and bylaws of the Company or the charter and bylaws of the
Bank (in either mutual or capital stock form), or any material
contract, lease or other instrument to which the Company or
the Bank has a beneficial interest, or any applicable law,
rule, regulation or order; (ii) violate any authorization,
approval, judgement, decree, order, statute, rule or
regulation applicable to the Company or the Bank, except for
such violations which would not have a material adverse effect
on the financial condition and results of operations of the
Company and the Bank on a consolidated basis; or (iii) with
the exception of the liquidation account established in the
Conversion, result in the creation of any material lien,
charge or encumbrance upon any property of the Company or the
Bank.
(q) No default exists, and no event has occurred which with notice
or lapse of time, or both, would constitute a default, on the
part of the Company, the Bank or its subsidiary in the due
performance and observance of any term, covenant or condition
of any indenture, mortgage, deed of trust, note, bank loan or
credit agreement or any other
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instrument or agreement to which the Company or the Bank or
its subsidiary is a party or by which any of them or any of
their property is bound or affected, except such defaults
which would not have a material adverse affect on the
financial condition or results of operations of the Company,
the Bank and its subsidiary on a consolidated basis; such
agreements are in full force and effect; and no other party to
any such agreements has instituted or, to the best knowledge
of the Company, the Bank or its subsidiary, threatened any
action or proceeding wherein the Company, the Bank or its
subsidiary would or might be alleged to be in default
thereunder.
(r) Upon consummation of the Conversion, the authorized, issued
and outstanding equity capital of the Company will be within
the range set forth in the Prospectus under the caption
"Capitalization," and no shares of Common Stock have been or
will be issued and outstanding prior to the Closing Date
referred to in Section 2 herein (other than in connection with
the incorporation of the Company); the Shares will have been
duly and validly authorized for issuance and, when issued and
delivered by the Company pursuant to the Plan against payment
of the consideration calculated as set forth in the Plan and
in the Prospectus, will be duly and validly issued, fully paid
and non-assessable; no preemptive rights exist with respect to
the Shares; and the terms and provisions of the Shares will
conform in all material respects to the description thereof
contained in the Registration Statement and the Prospectus. To
the best knowledge of the Company and the Bank, upon the
issuance of the Shares, good title to the Shares will be
transferred from the Company to the purchasers thereof against
payment therefor, subject to such claims as may be asserted
against the purchasers thereof by third-party claimants.
(s) 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 the approval of the Commission, the OTS, and any
necessary qualification, notification, registration or
exemption under the securities or blue sky laws of the various
states in which the Shares are to be offered, and except as
may be required under the rules and regulations of the NASD
and/or the National Association of Securities Dealers
Automated Quotation ("Nasdaq") Stock Market.
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(t) Robb, Dixon, Francis, Davis, Oneson & Company, which has
certified the consolidated audited financial statements and
schedules of the Bank included in the Prospectus, has advised
the Company and the Bank in writing that they are, with
respect to the Company and the Bank, independent public
accountants within the meaning of the Code of Professional
Ethics of the American Institute of Certified Public
Accountants and Title 12 of the Code of Federal Regulations
and Section 571.2(c)(3).
(u) Xxxxxx & Company, which has prepared the Bank's Conversion
Valuation Appraisal Report as of ____________, 1996 (as
amended or supplemented, if so amended or supplemented) (the
"Appraisal"), has advised the Company in writing that it is
independent of the Company and the Bank within the meaning of
the Conversion Regulations.
(v) The Company, the Bank and its subsidiary have timely filed all
required federal, state and local tax returns; the Company,
the Bank and its subsidiary 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.
(w) The Bank is in compliance 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.
(x) To the knowledge of the Company and the Bank, neither the
Company, the Bank nor employees of the Company or the Bank
have made any payment of funds of the Company or the Bank as a
loan for the purchase of the Shares or made any other payment
of funds prohibited by law, and no funds have been set aside
to be used for any payment prohibited by law.
(y) Prior to the Conversion, neither the Company nor the Bank has:
(i) issued any securities within the last 18 months (except
for notes to evidence other bank loans and reverse repurchase
agreements or other liabilities in the ordinary course of
business or as described in the Prospectus, and except for any
shares issued in connection with the incorporation of the
Company); (ii) had any material dealings within the 12 months
prior to the date hereof with any member of the NASD, or any
person related to or associated with such member,
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other than discussions and meetings relating to the proposed
Offering and routine purchases and sales of United States
government and agency securities; (iii) entered into a
financial or management consulting agreement except as
contemplated hereunder; and (iv) engaged any intermediary
between the Agent and the Company and the Bank in connection
with the offering of the Shares, and no person is being
compensated in any manner for such service. Appropriate
arrangements have been made for placing the funds received
from subscriptions for Shares in a special interest-bearing
account with the Bank until all Shares are sold and paid for,
with provision for refund to the purchasers in the event that
the Conversion is not completed for whatever reason or for
delivery to the Company if all Shares are sold.
(z) The Company and the Bank have not relied upon the Agent or its
legal counsel or other advisors for any legal, tax or
accounting advice in connection with the Conversion.
(aa) The Company is not required to be registered under the
Investment Company Act of 1940, as amended.
(bb) Any certificates signed by an officer of the Company or the
Bank pursuant to the conditions of this Agreement and
delivered to the Agent or their counsel that refers to this
Agreement shall be deemed to be a representation and warranty
by the Company or the Bank to the Agent as to the matters
covered thereby with the same effect as if such representation
and warranty were set forth herein.
SECTION 5. REPRESENTATIONS AND WARRANTIES.
Xxxx represents and warrants to the Company and the Bank that:
(i) Xxxx is a corporation and is validly existing in good
standing under the laws of the State of Ohio with full power and
authority to provide the services to be furnished to the Bank and the
Company hereunder.
(ii) 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 Xxxx, and
this Agreement has been duly and validly executed and delivered by Xxxx
and is a legal, valid and binding agreement of Xxxx, enforceable in
accordance with its terms.
(iii) Each of Xxxx and its employees, agent and
representatives who shall perform any of the services hereunder shall
be duly authorized and empowered, and
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shall have all licenses, approvals and permits necessary to perform
such services.
(iv) The execution and delivery of this Agreement by Xxxx, the
consummation of the transactions contemplated hereby and compliance
with the terms and provisions hereof will not conflict with, or result
in a breach of, any of the terms, provisions or conditions of, or
constitute a default (or an event which with notice or lapse of time or
both would constitute a default) under, the articles of incorporation
of Xxxx or any agreement, indenture or other instrument to which Xxxx
is a party or by which it or its property is bound.
(v) No approval of any regulatory or supervisory or other
public authority is required in connection with Xxxx'x execution and
delivery of this Agreement, except as may have been received.
(vi) There is no suit or proceeding or charge or action before
or by any court, regulatory authority or government agency or body or,
to the knowledge of Xxxx, pending or threatened, which might materially
adversely affect Xxxx'x performance of this Agreement.
SECTION 5.1 COVENANTS OF THE COMPANY AND THE BANK. The Company and the
Bank hereby jointly and severally covenant with each of the Agent as follows:
(a) The Company has filed the Registration Statement with the
Commission. 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 without
providing the Agent and its counsel an opportunity to review
such amendment or supplement or file any amendment or
supplement to which amendment or supplement the Agent or its
counsel shall reasonably object.
(b) The Bank has filed the Conversion Application with the OTS.
The Bank will not, at any time after the Conversion
Application is approved by, the OTS, file any amendment or
supplement to such Conversion Application without providing
the Agent and its counsel an opportunity to review such
amendment or supplement or file any amendment or supplement to
which amendment or supplement the Agent or its counsel shall
reasonably object.
(c) The Company has filed the Holding Company Application with the
OTS. The Company will not, at any time before the Holding
Company Application is approved by the OTS, file any amendment
or
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supplement to such Holding Company Application without
providing the Agent and its counsel an opportunity to review
the nonconfidential portions of such amendment or supplement
or file any amendment or supplement to which amendment or
supplement the Agent or its counsel shall reasonably object.
(d) The Company and the Bank will use their best efforts to cause
any post-effective amendment to the Registration Statement to
be declared effective by the Commission and any post-effective
amendment to the Conversion Application to be approved by the
OTS and will immediately upon receipt of any information
concerning the events listed below notify the Agent: (i) when
the Registration Statement, as amended, has become effective;
(ii) when the Conversion Application, as amended, has been
approved by the OTS; (iii) any comments from the Commission,
the OTS or any other governmental entity with respect to the
Conversion or the transactions contemplated by this Agreement;
(iv) of the request by the Commission, the OTS or any other
governmental entity for any amendment or supplement to the
Registration Statement, the Conversion Application or for
additional information; (v) of the issuance by the Commission,
the OTS or any other governmental entity of any order or other
action suspending the Offering or the use of the Registration
Statement or the Prospectus or any other filing of the Company
or the Bank under the Conversion Regulations, or other
applicable law, or the threat of any such action; (vi) the
issuance by the Commission, the OTS or any authority of any
stop order suspending the effectiveness of the Registration
Statement or of the initiation or threat of initiation or
threat of any proceedings for that purpose; or (vii) of the
occurrence of any event mentioned in paragraph (h) below. The
Company and the Bank will make every reasonable effort (i) to
prevent the issuance by the Commission, the OTS or any state
authority of any such order and, if any such order shall at
any time be issued, (ii) to obtain the lifting thereof at the
earliest possible time.
(e) The Company and the Bank will deliver to the Agent and to its
counsel two conformed copies of the Registration Statement,
the Conversion Application and the Holding Company
Application, as originally filed and of each amendment or
supplement thereto, including all exhibits. Further, the
Company and the Bank will deliver such additional copies of
the foregoing documents to counsel to the Agent as may be
required for any NASD and "blue sky" filings.
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(f) The Company and the Bank will furnish to the Agent, from time
to time during the period when the Prospectus (or any later
prospectus related to this offering) is required to be
delivered under the 1933 Act or the Securities Exchange Act of
1934 (the "1934 Act"), such number of copies of such
Prospectus (as amended or supplemented) as the Agent may
reasonably request for the purposes contemplated by the 1933
Act, the 1933 Act Regulations, the 1934 Act or the rules and
regulations promulgated under the 1934 Act (the "1934 Act
Regulations"). The Company authorizes the Agent to use the
Prospectus (as amended or supplemented, if amended or
supplemented) in any lawful manner contemplated by the Plan in
connection with the sale of the Shares by the Agent.
(g) The Company and the Bank will comply with any and all material
terms, conditions, requirements and provisions with respect to
the Conversion and the transactions contemplated thereby
imposed by the Commission, the OTS or the Conversion
Regulations, and by the 1933 Act, the 1933 Act Regulations,
the 1934 Act and the 1934 Act Regulations to be complied with
prior to or subsequent to the Closing Date and when the
Prospectus is required to be delivered, and during such time
period the Company and the Bank will comply, at their own
expense, with all material requirements imposed upon them by
the Commission, the OTS or the Conversion Regulations, and by
the 1933 Act, the 1933 Act Regulations, the 1934 Act and the
1934 Act Regulations, including, without limitation, Rule
10b-5 under the 1934 Act, in each case as from time to time in
force, so far as necessary to permit the continuance of sales
or dealing in shares of Common Stock during such period in
accordance with the provisions hereof and the Prospectus.
(h) If, at any time during the period when the Prospectus relating
to the Shares is required to be delivered, any event relating
to or affecting the Company, the Bank or its subsidiary shall
occur, as a result of which it is necessary or appropriate, in
the opinion of counsel for the Company and the Bank or in the
reasonable opinion of the Agent's counsel, to amend or
supplement the Registration Statement or Prospectus in order
to make the Registration Statement or Prospectus not
misleading in light of the circumstances existing at the time
the Prospectus is delivered to a purchaser, the Company and
the Bank will immediately so inform the Agent and prepare and
file, at their own expense, with the Commission and the OTS
and furnish to the
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Agent a reasonable number of copies of an amendment or
amendments of, or a supplement or supplements to, the
Registration Statement or Prospectus (in form and substance
reasonably satisfactory to the Agent and its counsel after a
reasonable time for review) which will amend or supplement the
Registration Statement or Prospectus so that as amended or
supplemented it 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 existing at the time the Prospectus is delivered
to a purchaser, not misleading. For the purpose of this
Agreement, the Company and the Bank each will timely furnish
to the Agent such information with respect to itself as the
Agent may from time to time reasonably request.
(i) The Company and the Bank will take all necessary actions, in
cooperating with the Agent, and furnish to whomever the Agent
may direct, such information as may be required to qualify or
register the Shares for offering and sale by the Company or to
exempt such Shares from registration, or to exempt the Company
as a broker-dealer and its officers, directors and employees
as broker-dealers or agent under the applicable securities or
blue sky laws of such jurisdictions in which the Shares are
required under the Conversion Regulations to be sold or as the
Agent and the Company and the Bank may reasonably agree upon;
provided, however, that the Company shall not be obligated to
file any general consent to service of process, to qualify to
do business in any jurisdiction in which it is not so
qualified, or to register its directors or officers as
brokers, dealers, salesmen or agent in any jurisdiction. In
each jurisdiction where any of the Shares shall have been
qualified or registered as above provided, the Company will
make and file such statements and reports in each fiscal
period as are or may be required by the laws of such
jurisdiction.
(j) The liquidation account for the benefit of Eligible Account
Holders and Supplemental Eligible Account Holders will be duly
established and maintained in accordance with the requirements
of the OTS, and such Eligible Account Holders and Supplemental
Eligible Account Holders who continue to maintain their
savings accounts in the Bank will have an inchoate interest in
their pro rata portion of the liquidation account which shall
have a priority superior to that of the holders of shares of
Common Stock in the event of a complete liquidation of the
Bank.
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(k) The Company and the Bank will not sell or issue, contract to
sell or otherwise dispose of, for a period of 90 days after
the Closing Date, without the Agent's prior written consent,
any shares of Common Stock other than the Shares or other than
in connection with any plan or arrangement described in the
Prospectus, including existing stock benefit plans.
(l) The Company shall register its Common Stock under Section
12(g) of the 1934 Act concurrent with the Offering pursuant to
the Plan and shall request that such registration be effective
upon completion of the Conversion. The Company shall maintain
the effectiveness of such registration for not less than three
years or such shorter period as may be required by the OTS.
(m) During the period during which the Company's Common Stock is
registered under the 1934 Act or for three (3) years from the
date hereof, whichever period is greater, the Company will
furnish to its stockholders as soon as practicable after the
end of each fiscal year an annual report of the Company
(including a consolidated balance sheet and statements of
consolidated income, stockholders' equity and cash flows of
the Company and its subsidiaries as at the end of and for such
year, certified by independent public accountants in
accordance with Regulation S-X under the 1933 Act and the 1934
Act).
(n) During the period of three years from the date hereof, the
Company will furnish to the Agent: (i) as soon as practicable
after such information is publicly available, a copy of each
report of the Company furnished to or filed with the
Commission under the 1934 Act or any national securities
exchange or system on which any class of securities of the
Company is listed or quoted (including, but not limited to,
reports on Forms 10-K, 10-Q and 8-K and all proxy statements
and annual reports to stockholders), (ii) a copy of each other
non-confidential report of the Company mailed to its
stockholders or filed with the Commission, the OTS or any
other supervisory or regulatory authority or any national
securities exchange or system on which any class of securities
of the Company is listed or quoted, each press release and
material news items and additional documents and information
with respect to the Company or the Bank as the Agent may
reasonably request; and (iii) from time to time, such other
nonconfidential information concerning the Company or the Bank
as the Agent may reasonably request.
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(o) The Company and the Bank will use the net proceeds from the
sale of the Shares in the manner set forth in the Prospectus
under the caption "Use of Proceeds."
(p) Other than as permitted by the Conversion Regulations, the
HOLA, the 1933 Act, the 1933 Act Regulations, and the laws of
any state in which the Shares are registered or qualified for
sale or exempt from registration, neither the Company nor the
Bank will distribute any prospectus, offering circular or
other offering material in connection with the offer and sale
of the Shares.
(q) The Company will use its best efforts to (i) encourage and
assist a market maker to establish and maintain a market for
the Shares and (ii) list and maintain quotation of the Shares
on a national or regional securities exchange or on the Nasdaq
Stock Market effective on or prior to the Closing Date.
(r) The Bank will maintain appropriate arrangements for depositing
all funds received from persons mailing subscriptions for or
orders to purchase Shares in the Offering on an
interest-bearing basis at the rate described in the Prospectus
until the Closing Date and satisfaction of all conditions
precedent to the release of the Bank's obligation to refund
payments received from persons subscribing for or ordering
Shares in the Offering in accordance with the Plan and as
described in the Prospectus or until refunds of such funds
have been made to the persons entitled thereto or withdrawal
authorizations canceled in accordance with the Plan and as
described in the Prospectus. The Bank will maintain such
records of all funds received to permit the funds of each
subscriber to be separately insured by the FDIC (to the
maximum extent allowable) and to enable the Bank to make the
appropriate refunds of such funds in the event that such
refunds are required to be made in accordance with the Plan
and as described in the Prospectus.
(s) The Company will promptly take all necessary action to
register as a savings and loan holding company under the HOLA.
(t) The Company and the Bank will take such actions and furnish
such information as are reasonably requested by the Agent in
order for the Agent to ensure compliance with the NASD's
"Interpretation Relating to Free Riding and Withholding."
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(u) Neither the Company nor the Bank will amend the Plan of
Conversion without notifying the Agent prior thereto.
(v) The Company shall assist the Agent, if necessary, in
connection with the allocation of the Shares in the event of
an oversubscription and shall provide the Agent with any
information necessary to assist the Company in allocating the
Shares in such event and such information shall be accurate
and reliable.
(w) Prior to the Closing Date, the Company and the Bank will
inform the Agent of any event or circumstances of which it is
aware as a result of which the Registration Statement and/or
Prospectus, as then amended or supplemented, would contain an
untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements
therein not misleading.
(x) Subsequent to the date the Registration Statement is declared
effective by the Commission and prior to the Closing Date,
except as otherwise may be indicated or contemplated therein
or set forth in an amendment or supplement thereto, neither
the Company nor the Bank will have: (i) issued any securities
or incurred any liability or obligation, direct or contingent,
for borrowed money, except borrowings from the same or similar
sources indicated in the Prospectus in the ordinary course of
its business, or (ii) entered into any transaction which is
material in light of the business and properties of the
Company and the Bank, taken as a whole.
SECTION 6. PAYMENT OF EXPENSES. Whether or not the Conversion is
completed or the sale of the Shares by the Company is consummated, the Company
and the Bank jointly and severally agree to pay or reimburse the Agent for: (a)
all filing fees in connection with all filings related to the Offering with the
NASD; (b) any stock issue or transfer taxes which may be payable with respect to
the sale of the Shares; (c) all reasonable expenses of the Conversion, including
but not limited to the Company's and the Bank's, and the Agency's attorneys'
fees and expenses, blue sky fees, transfer agent, registrar and other agent
charges, fees relating to auditing and accounting or other advisors and costs of
printing all documents necessary in connection with the Conversion; provided,
however, there will be no out-of-pocket expenses charged by the Agent for
expenses such as travel, lodging and meals. However, such out-of-pocket expenses
do not include expenses incurred with respect to the matters set forth in (a),
(b) or (c) above. In the event the Company is unable to sell a minimum of
612,000 Shares or the Conversion is terminated or otherwise
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abandoned, the Company and the Bank shall promptly reimburse the Agent in
accordance with Section 2 hereof.
SECTION 7. CONDITIONS TO THE AGENT'S OBLIGATIONS. The obligations of
the Agent hereunder, as to the Shares to be delivered at the Closing Date, are
subject, to the extent not waived in writing by the Agent, to the condition that
all representations and warranties of the Company and the Bank herein are, at
and as of the commencement of the Offering and at and as of the Closing Date,
true and correct in all material respects, the condition that the Company and
the Bank shall have performed all of their obligations hereunder to be performed
on or before such dates, and to the following further conditions:
(a) At the Closing Date, the Company and the Bank shall have
conducted the Conversion in all material respects in
accordance with the Plan, the Conversion Regulations, and all
other applicable laws, regulations, decisions and orders,
including all terms, conditions, requirements and provisions
precedent to the Conversion imposed upon them by the OTS.
(b) The Registration Statement shall have been declared effective
by the Commission and the Conversion Application approved by
the OTS not later than 5:30 p.m. on the date of this
Agreement, or with the Agent's consent at a later time and
date; and at the Closing Date, no stop order suspending the
effectiveness of the Registration Statement shall have been
issued under the 1933 Act or proceedings therefore initiated
or threatened by the Commission or any state authority, and no
order or other action suspending the authorization of the
Prospectus or the consummation of the Conversion shall have
been issued or proceedings therefore initiated or, to the
Company's or the Bank's knowledge, threatened by the
Commission, the OTS, the FDIC, or any state authority.
(c) At the Closing Date, the Agent shall have received:
(1) The favorable opinion, dated as of the Closing Date and
addressed to the Agent and for its benefit, of Vorys, Xxxxx,
Xxxxxxx and Xxxxx, special counsel for the Company and the
Bank, in form and substance to the effect that:
(i) The Company has been duly incorporated
and is validly existing as a corporation under the
laws of the State of Ohio.
(ii) The Company has corporate power and
authority to own, lease and operate its properties and
to conduct its business as described in the
Registration Statement and the Prospectus; and the
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Company is duly qualified as a foreign corporation to
transact business and is in good standing in each
jurisdiction listed below in which it owns or leases
properties or in which the conduct of its business
requires such qualification or in which the conduct
of its business upon consummation of the Conversion
will require such qualifications, except where the
failure so to qualify would not have a material
adverse effect on the business assets or financial
condition of the Company.
(iii) The Bank has been and is a duly
organized and is a validly existing federally
chartered savings bank in mutual form and upon the
Conversion will become a duly organized and validly
existing federally chartered savings bank in capital
stock form of organization, in both instances duly
authorized to conduct its business and own its
property as described in the Registration Statement
and the Prospectus. The Bank is in good standing and
is duly qualified as a foreign corporation to
transact business and is in good standing in each
jurisdiction in which its ownership of property or
leasing of property or the conduct of its business
requires such qualification, unless the failure to be
so qualified in one or more of such jurisdictions
would not have a material adverse effect on the
condition, financial or otherwise, or the business,
operations or income of the Bank. All of the
outstanding capital stock of the Bank upon completion
of the Conversion will be duly authorized and, upon
payment therefor, will be validly issued, fully paid
and non-assessable and will be owned by the Company,
free and clear of any liens, encumbrances, claims or
other restrictions.
(iv) The Bank has one subsidiary, Homciti
Service Corp, which is duly incorporated and validly
existing as a corporation in good standing under the
laws of the State of Ohio, and which has full
corporate power and authority to own its own
properties and conduct its business as described in
the Prospectus; and the subsidiary is duly qualified
to do business as a foreign corporation under the
laws of Ohio, and is in good standing as such in each
jurisdiction in which such qualification is required,
except where the failure to so qualify would not have
a material adverse effect on the business, assets or
financial condition of the Bank on a consolidated
basis. The subsidiary holds all licenses,
certificates and permits from governmental
authorities necessary for the conduct of its business
as described in the Prospectus except where the
failure to hold such
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licenses, certificates or permits would not have a
material adverse effect on the business, assets or
financial condition of the Bank on a consolidated
basis; and such subsidiary is not in material
violation of its articles of incorporation or bylaws.
All of the outstanding stock of the subsidiary has
been duly authorized and is validly issued, fully
paid and nonassessable, and all such stock is owned
directly by the Bank, free and clear of any liens,
encumbrances, claims or other restrictions.
(v) The Bank is a member of the
FHLB-Chicago. The deposit accounts of the Bank are
insured by the FDIC up to the maximum amount allowed
under law and no proceedings for the termination or
revocation of such insurance are pending or, to such
counsel's Actual Knowledge, threatened; the
description of the liquidation account as set forth
in the Prospectus under the captions "The
Conversion-Liquidation Account," to the extent that
such information constitutes matters of law and legal
conclusions, has been reviewed by such counsel and is
accurately described in all material respects.
(vi) Upon consummation of the Conversion,
the authorized, issued and outstanding capital stock
of the Company will be within the range set forth in
the Prospectus under the caption "Capitalization,"
and, except for shares issued upon incorporation of
the Company, no shares of Common Stock have been
issued prior to the Closing Date; at the time of the
Conversion, the Shares subscribed for pursuant to the
Offering will have been duly and validly authorized
for issuance, and when issued and delivered by the
Company pursuant to the Plan against payment of the
consideration calculated as set forth in the Plan and
Prospectus, will be duly and validly issued and fully
paid and non-assessable; the issuance of the Shares
is not subject to preemptive rights and the terms and
provisions of the Shares conform in all material
respects to the description thereof contained in the
Prospectus. To such counsel's Actual Knowledge, upon
the issuance of the Shares, good title to the Shares
will be transferred from the Company to the
purchasers thereof against payment therefor, subject
to such claims as may be asserted against the
purchasers thereof by third-party claimants.
(vii) The Bank and the Company have full
corporate power and authority to enter into the
Agreement and to consummate the transactions
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contemplated thereby and by the Plan of Conversion.
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 the Company and the
Bank; and this Agreement is a valid and binding
obligation of the Company and the Bank, enforceable
in accordance with its terms, except as the
enforceability thereof may be limited by (i)
bankruptcy, insolvency, reorganization, moratorium,
conservatorship, receivership or other similar laws
now or hereafter in effect relating to or affecting
the enforcement of creditors' rights generally or the
rights of creditors of federal savings institutions,
(ii) general equitable principles, (iii) laws
relating to the safety and soundness of insured
depository institutions, and (iv) applicable law or
public policy with respect to the indemnification
and/or contribution provisions contained herein,
including without limitations the provision of
Sections 23A and 23B of the Federal Reserve Act and
except that no opinion need to be expressed as to the
effect or availability of equitable remedies or
injunctive relief (regardless of whether such
enforceability is considered in a proceeding in
equity or at law).
(viii) The Conversion Application has been
approved by the OTS and the Prospectus has been
authorized for use by the OTS. The OTS has approved
the Holding Company Application and issued its order
of approval under the savings and loan holding
company provisions of the HOLA, the purchase by the
Company of all of the issued and outstanding capital
stock of the Bank has been authorized by the OTS and
no action has been taken, and to such counsel's
Actual Knowledge, none is pending or threatened, to
revoke any such authorization or approval.
(ix) The Plan has been duly adopted by the
required vote of the directors of the Company and the
Bank, and based upon the certificate of the inspector
of election, by the members of the Bank.
(x) Subject to the satisfaction of the
conditions to the OTS' approval of the Conversion, no
further approval, registration, authorization,
consent or other order of any federal regulatory
agency, is required in connection with the execution
and delivery of this Agreement, the issuance of the
Shares and the consummation of the Conversion, except
as may be required under the securities or blue sky
laws of various jurisdictions (as to which no opinion
need be
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rendered) and except as may be required under the
rules and regulations of the NASD and/or the Nasdaq
Stock Market (as to which no opinion need by
rendered). To such counsel's Actual Knowledge, the
Conversion has been consummated in all material
respects in accordance with all applicable provisions
of the HOLA and the Conversion Regulations.
(xi) The Registration Statement is effective
under the 1933 Act and no stop order suspending the
effectiveness has been issued under the 1933 Act or
proceedings therefor initiated or, to such counsel's
Actual Knowledge, threatened by the Commission.
(xii) At the time the Conversion
Application, including the Prospectus contained
therein, was approved by the OTS, the Conversion
Application, including the Prospectus contained
therein, complied as to form in all material respects
with the requirements of the Conversion Regulations,
federal law and all applicable rules and regulations
promulgated thereunder (other than the financial
statements, the notes thereto, and other tabular,
financial, statistical and appraisal data included
therein, as to which no opinion need be rendered).
(xiii) At the time that the Registration
Statement became effective, (i) the Registration
Statement (as amended or supplemented, if so amended
or supplemented) (other than the financial
statements, the notes thereto, and other tabular,
financial, statistical and appraisal data included
therein, as to which no opinion need be rendered),
complied as to form in all material respects with the
requirements of the 1933 Act and the 1933 Act
Regulations, and (ii) the Prospectus (other than the
financial statements, the notes thereto, and other
tabular, financial, statistical and appraisal data
included therein, as to which no opinion need be
rendered) complied as to form in all material
respects with the requirements of the 1933 Act, the
1933 Act Regulations, the Conversion Regulations and
federal law.
(xiv) The terms and provisions of the Shares
of the Company conform, in all material respects, to
the description thereof contained in the Registration
Statement and Prospectus, and the form of certificate
used to evidence the Shares is in due and proper
form.
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(xv) There are no legal or governmental
proceedings pending, or to such counsel's Actual
Knowledge, threatened which are required to be
disclosed in the Registration Statement and
Prospectus, other than those disclosed therein, and
to such counsel's Actual Knowledge, all pending legal
and governmental proceedings to which the Company or
the Bank is a party or of which any of their property
is the subject, which are not described in the
Registration Statement and the Prospectus, including
ordinary routine litigation incidental to the
Company's or the Bank's business, are, considered in
the aggregate, not material.
(xvi) To such counsel's Actual Knowledge,
there are no material contracts, indentures,
mortgages, loan agreements, notes, leases or other
instruments required to be described or referred to
in the Conversion Application, the Registration
Statement or the Prospectus or required to be filed
as exhibits thereto other than those described or
referred to therein or filed as exhibits thereto in
the Conversion Application, the Registration
Statement or the Prospectus. The description in the
Conversion Application, the Registration Statement
and the Prospectus of such documents and exhibits is
accurate in all material respects and fairly presents
the information required to be shown.
(xvii) To such counsel's Actual Knowledge,
the Company and the Bank have conducted the
Conversion, in all material respects, in accordance
with all applicable requirements of the Plan and
applicable federal law. The Plan complies in all
material respects with all applicable federal laws,
rules, regulations, decisions and orders including,
but not limited to, the Conversion Regulations; no
order has been issued by the OTS, the Commission, the
FDIC, or any state authority to suspend the Offering
or the use of the Prospectus, and no action for such
purposes has been instituted or, to such counsel's
Actual Knowledge, threatened by the OTS, the
Commission, the FDIC, or any state authority and, to
such counsel's Actual Knowledge, no person has sought
to obtain regulatory or judicial review of the final
action of the OTS, approving the Plan, the Conversion
Application, the Holding Company Application or the
Prospectus.
(xviii) To such counsel's Actual Knowledge, the
Company and the Bank have obtained all material
licenses, permits and other governmental
authorizations currently required for the conduct of
their businesses and all such licenses, permits
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30
and other governmental authorizations are in full
force and effect, and the Company and the Bank are in
all material respects complying therewith.
(xix) To such counsel's Actual Knowledge,
neither the Company nor the Bank is in violation of
its articles of incorporation and bylaws or its
Charter and bylaws, as appropriate or, to such
counsel's Actual Knowledge, in default or violation
of any obligation, agreement, covenant or condition
contained in any contract, indenture, mortgage, loan
agreement, note, lease or other instrument to which
it is a party or by which it or its property may be
bound, except for such defaults or violations which
would not have a material adverse impact on the
financial condition or results of operations of the
Company, the Bank and its subsidiary on a
consolidated basis; to such counsel's Actual
Knowledge, the execution and delivery of this
Agreement, the occurrence of the obligations herein
set forth and the consummation of the transactions
contemplated herein will not conflict with or
constitute a breach of, or default under, or result
in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the
Company or the Bank pursuant to any material
contract, indenture, mortgage, loan agreement, note,
lease or other instrument to which the Company or the
Bank is a party or by which any of them may be bound,
or to which any of the property or assets of the
Company or the Bank are subject (other than the
establishment of the liquidation account); and, such
action will not result in any violation of the
provisions of the articles of incorporation or bylaws
of the Company or the Charter or bylaws of the Bank
or, to such counsel's actual knowledge, result in any
violation of any applicable federal law, act,
regulation need be rendered (except that no opinion
with respect to the securities and blue sky laws of
various jurisdictions or the rules or regulations of
the NASD and/or the Nasdaq Stock Market) or order or
court order, writ, injunction or decree.
(xxi) The Company's Articles of
Incorporation and bylaws comply in all materials
respects with the laws of the State of Ohio. The
Bank's Charter and bylaws comply in all material
respects with the federal law and the Rules and
Regulations of the Office of Thrift Supervision.
(xxi) To such counsel's Actual Knowledge,
neither the Company nor the Bank is in violation of
any directive from the OTS or the FDIC to make any
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31
material change in the method of conducting its
respective business.
(xxii) The information in the Prospectus
under the captions "Regulation," "The Conversion,"
"Restrictions on Acquisition of the Company and the
Bank" and "Description of Capital Stock of the
Company," to the extent that such information
constitutes matters of law, summaries of legal
matters, documents or proceedings, or legal
conclusions, has been reviewed by such counsel and is
correct in all material respects. The description of
the Conversion process under the caption "The
Conversion" in the Prospectus has been reviewed by
such counsel and fairly describes such process in all
material respects. The discussion of statutes or
regulations described or referred to in the
Prospectus are accurate summaries and fairly present
the information required to be shown. The information
under the caption "The Conversion-Tax Aspects" has
been reviewed by such counsel and fairly describes
the opinions rendered by them to the Company and the
Bank with respect to such matters.
In addition, such counsel shall state that
during the preparation of the Conversion Application,
the Registration Statement and the Prospectus, they
participated in conferences with certain officers of,
the independent public and internal accountants for,
and other representatives of the Company and the
Bank, at which conferences the contents of the
Conversion Application, the Registration Statement
and the Prospectus and related matters were discussed
and, while such counsel have not confirmed the
accuracy or completeness of or otherwise verified the
information contained in the Conversion Application,
the Registration Statement or the Prospectus, and do
not assume any responsibility for such information,
based upon such conferences and a review of documents
deemed relevant for the purpose of rendering their
opinion (relying as to materiality as to factual
matters on certificates of officers and other factual
representations by the Company and the Bank, nothing
has come to their attention that would lead them to
believe that the Conversion Application, the
Registration Statement, the Prospectus, or any
amendment or supplement thereto (other than the
financial statements, the notes thereto, and other
tabular, financial, statistical and appraisal data
included therein as to which no view need be
rendered) contained an untrue statement of a material
fact or omitted to state a material fact required to
be stated therein
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32
or necessary to make the statements therein, in light
of the circumstances under which they were made, not
misleading.
In giving such opinion, such counsel may
rely as to all matters of fact on certificates of
officers or directors of the Company and the Bank and
certificates of public officials. Such counsel's
opinion shall be limited to matters governed by
federal laws and by the laws of the State of Ohio.
The opinion of Vorys, Xxxxx, Xxxxxxx and Xxxxx shall
be governed by the Legal Opinion Accord ("Accord") of
the American Bar Association Section of Business Law
(1991). The term "Actual Knowledge" as used herein
shall have the meaning set forth in the Accord. For
purposes of such opinion, no proceedings shall be
deemed to be pending, no order or stop order shall be
deemed to be issued, and no action shall be deemed to
be instituted unless, in each case, a director or
executive officer of the Company or the Bank shall
have received a copy of such proceedings, order, stop
order or action. In addition, such opinion may be
limited to present statutes, regulations and judicial
interpretations and to facts as they presently exist;
in rendering such opinion, such counsel need assume
no obligation to revise or supplement it 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 proposed or pending
regulations or policy statements issued by any
regulatory agency, whether or not promulgated
pursuant to any such legislation, would affect the
validity of the Conversion or any aspect thereof.
Such counsel may assume that any agreement is the
valid and binding obligation of any parties to such
agreement other than the Company or the Bank.
(d) The favorable opinion, dated as of the Closing
Date, of Silver, Xxxxxxxx & Taff, L.L.P., the
Agent's counsel, with respect to such matters as
the Agent may reasonably require. Such opinion may
rely upon the opinions of counsel to the Company
and the Bank, and as to matters of fact, upon
certificates of officers and directors of the
Company and the Bank delivered pursuant hereto or
as such counsel shall reasonably request.
(e) At the Closing Date, the Agent shall receive a
certificate of the Chief Executive Officer and the
principal accounting officer of the Company and the
Bank in form and substance reasonably satisfactory
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33
to the Agent's Counsel, dated as of such Closing
Date, to the effect that: (i) they have carefully
examined the Prospectus and, in their opinion, at the
time the Prospectus became authorized for final use,
the Prospectus did not contain any 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) since the date the
Prospectus became authorized for final 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 specifically, but
without limitation, any material adverse change in
the condition, financial or otherwise, or in the
earnings, capital, properties or business of the
Company, the Bank or its subsidiary, and the
conditions set forth in this Section 7 have been
satisfied; (iii) since the respective dates as of
which information is given in the Registration
Statement and the Prospectus, there has been no
material adverse change in the condition, financial
or otherwise, or in the earnings, capital or
properties of the Company, the Bank or its
subsidiary, independently, or of the Company, the
Bank or its subsidiary considered as one enterprise,
whether or not arising in the ordinary course of
business; (iv) the representations and warranties in
Section 4 are true and correct with the same force
and effect as though expressly made at and as of the
Closing Date; (v) the Company, and the Bank have
complied in all material respects with all agreements
and satisfied all conditions on their part to be
performed or satisfied at or prior to the Closing
Date and will comply in all material respects with
all obligations to be satisfied by them after the
Conversion; (vi) no stop order suspending the
effectiveness of the Registration Statement has been
initiated or, to the best knowledge of the Company or
the Bank, threatened by the Commission or any state
authority; (vii) no order suspending the Offering,
the Conversion, the acquisition of all of the shares
of the Bank by the Company or the effectiveness of
the Prospectus has been issued and no proceedings for
that purpose are pending or, to the best knowledge of
the Company or the Bank, threatened by the OTS, the
Commission, the FDIC, or any state authority; and
(viii) to the best knowledge of the Company or the
Bank, no person has sought to obtain review of the
final action of the OTS approving the Plan.
(f) Prior to and at the Closing Date: (i) in the
reasonable opinion of the Agent, there shall have
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34
been no material adverse change in the condition,
financial or otherwise, or in the earnings or
business of the Company, the Bank or its subsidiary
independently, or of the Company, the Bank and its
subsidiary considered as one enterprise, from that as
of the latest dates as of which such condition is set
forth in the Prospectus other than transactions
referred to or contemplated therein; (iii) the
Company or the Bank shall not have received from the
OTS or the FDIC any direction (oral or written) to
make any material change in the method of conducting
their business with which it has not complied (which
direction, if any, shall have been disclosed to the
Agent) or which materially and adversely would affect
the business, operations or financial condition or
income of the Company and the Bank (together with its
Subsidiary) taken as a whole; (iv) the Company, the
Bank and its subsidiary shall not 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 outstanding indebtedness;
(v) 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,
the Bank or its subsidiary, threatened against the
Company, the Bank or its subsidiary or affecting any
of their properties wherein an unfavorable decision,
ruling or finding would materially and adversely
affect the business, operations, financial condition
or income of the Company, the Bank and its subsidiary
taken as a whole; and (vi) the Shares have been
qualified or registered for offering and sale or
exempted therefrom under the securities or blue sky
laws of the jurisdictions as the Agent shall have
reasonably requested and as agreed to by the Company
and the Bank.
(g) Concurrently with the execution of this Agreement,
the Agent shall receive a letter from Robb, Dixon,
Francis, Davis, Oneson & Company dated as of the
date of the Prospectus and addressed to the Agent:
(i) confirming that Robb, Dixon, Francis, Davis,
Oneson & Company is a firm of independent public
accounts within the meaning of Rule 101 of the Code
of Professional Ethics of the American Institute of
Certified Public Accountants and applicable
regulations of the OTS and stating in effect that
in its opinion the consolidated financial
statements, schedules and related notes of the Bank
as of June 30, 1996 and 1995 and for each of the
three years in the period ended June 30, 1996, as
are included in the Prospectus and covered by their
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35
opinion included therein, comply as to form in all
material respects with the applicable accounting
requirements and related published rules and
regulations of the OTS and the 1933 Act; (ii) stating
in effect that, on the basis of certain agreed upon
procedures (but not an audit in accordance with
generally accepted auditing standards) consisting of
a reading of the latest available unaudited interim
consolidated financial statements of the Bank
prepared by the Bank, a reading of the minutes of the
meetings of the Board of Directors and members of the
Bank and consultations with officers of the Bank
responsible for financial and accounting matters,
nothing came to their attention which caused them to
believe that: (A) the unaudited financial statements
included in the Prospectus are not in conformity with
the 1933 Act, applicable accounting requirements of
the OTS and generally accepted accounting principles
applied on a basis substantially consistent with that
of the audited financial statements included in the
Prospectus; or (B) during the period from the date of
the latest unaudited consolidated financial
statements included in the Prospectus to a specified
date not more than three business days prior to the
date of the Prospectus, except as has been described
in the Prospectus, there was any increase in
borrowings, other than normal deposit fluctuations,
by the Bank; or (C) there was any decrease in the
consolidated net assets of the Bank at the date of
such letter as compared with amounts shown in the
latest unaudited consolidated statement of condition
included in the Prospectus; and (iii) stating that,
in addition to the audit referred to in their opinion
included in the Prospectus and the performance of the
procedures referred to in clause (ii) of this
subsection (f), they have compared with the general
accounting records of the Bank, which are subject to
the internal controls of the Bank, the accounting
system and other data prepared by the Bank, directly
from such accounting records, to the extent specified
in such letter, such amounts and/or percentages set
forth in the Prospectus as the Agent may reasonably
request; and they have reported on the results of
such comparisons.
(h) At the Closing Date, the Agent shall receive a letter
dated the Closing Date, addressed to the Agent,
confirming the statements made by Robb, Dixon,
Francis, Davis, Oneson & Company in the letter
delivered by it pursuant to subsection (f) of this
Section 7, the "specified date" referred to in clause
(ii) of subsection (f) thereof to be a
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36
date specified in such letter, which shall not be
more than three business days prior to the Closing
Date.
(i) At the Closing Date, the Agent shall receive a
letter from Xxxxxx & Company, dated the date
thereof and addressed to counsel for the Agent (i)
confirming that said firm is independent of the
Company and the Bank and is experienced and expert
in the area of corporate appraisals within the
meaning of Title 12 of the Code of Federal
Regulations, Section 563b.7(f)(1)(i), (ii) stating
in effect that the Appraisal prepared by such firm
complies in all material respects with the
applicable requirements of Title 12 of the Code of
Federal Regulations, and (iii) further stating that
their opinion of the aggregate pro forma market
value of the Company and the Bank expressed in
their Appraisal dated as of _________ __, 1996, and
most recently updated, remains in effect.
(j) The Company and the Bank shall not have sustained
since the date of the latest financial statements
included in 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 or contemplated in the
Registration Statement and Prospectus and since the
respective dates as of which information is given
in the Registration Statement and Prospectus, there
shall not have been any change in the long-term
debt of the Company or the Bank other than debt
incurred in relation to the purchase of Shares by
the Bank's Eligible Plans, or any change, or any
development involving a prospective change, in or
affecting the general affairs, management,
financial position, stockholders' equity or results
of operations of the Company or the Bank, otherwise
than as set forth or contemplated in the
Registration Statement and Prospectus, the effect
of which, in any such case described above, is in
Xxxx'x reasonable judgment sufficiently material
and adverse as to make it impracticable or
inadvisable to proceed with the Subscription
Offering or the delivery of the Shares on the terms
and in the manner contemplated in the Prospectus.
(k) At or prior to the Closing Date, the Agent shall
receive: (i) a copy of the letter from the OTS
approving the Conversion Application and
authorizing the use of the Prospectus; (ii) a copy
of the order from the Commission declaring the
Registration Statement effective; (iii) a
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37
certificate from the OTS evidencing the existence of
the Bank; (iv) certificate of good standing from the
State of Ohio evidencing the good standing of the
Company and the Bank's subsidiary; (v) a certificate
from the FDIC evidencing the Bank's insurance of
accounts; (vi) a certificate of the FHLB-Chicago
evidencing the Bank's membership thereof; (vii) a
copy of the letter from the OTS approving the
Company's Holding Company Application; and (viii) a
copy of the Bank's federal stock charter.
(l) 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 or in the
over-the-counter market, or quotations halted
generally on the Nasdaq Stock 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 the NASD or
by order of the Commission or any other
governmental authority; (ii) a general moratorium
on the operations of commercial banks, Ohio savings
banks or federal savings banks or a general
moratorium on the withdrawal of deposits from
commercial banks, Ohio savings banks or federal
savings banks declared by federal or state
authorities; (iii) the engagement by the United
States in hostilities which have resulted in the
declaration, on or after the date hereof, of a
national emergency or war; or (iv) a material
decline in the price of equity or debt securities
if the effect of such a declaration or decline, in
the Agent's reasonable judgement, makes it
impracticable or inadvisable to proceed with the
Offering or the delivery of the shares on the terms
and in the manner contemplated in the Registration
Statement and the Prospectus.
(m) At or prior to the Closing Date, counsel to Xxxx
shall have been furnished with such documents and
opinions as they may reasonably require for the
purpose of enabling them to pass upon the sale of
the Shares as herein contemplated and related
proceedings or in order to evidence the occurrence
or completeness of any of the representations or
warranties, or the fulfillment of any of the
conditions, herein contained; and all proceedings
taken by the Company or the Bank in connection with
the Conversion and the sale of the Shares as herein
contemplated shall be satisfactory in form and
substance to Xxxx and its counsel.
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SECTION 8. INDEMNIFICATION.
(a) The Company and the Bank jointly and severally
agree to indemnify and hold harmless the
Agent, its respective officers and directors,
employees and agents, and each person, if any,
who controls the Agent within the meaning of
Section 15 of the 1933 Act or Section 20(a) of
the 1934 Act, against any and all loss,
liability, claim, damage or expense whatsoever
(including but not limited to settlement
expenses), joint or several, that the Agent or
any of them may suffer or to which the Agent
and any such persons may become subject under
all applicable federal or state laws or
otherwise, and to promptly reimburse the Agent
and any such persons upon written demand for
any expense (including reasonable fees and
disbursements of counsel) incurred by the
Agent or any of 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: (i) 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), preliminary or final
Prospectus (or any amendment or supplement
thereto), the Conversion Application (or any
amendment or supplement thereto), the Holding
Company Application or any instrument or
document executed by the Company or the Bank
or based upon written information supplied by
the Company or the Bank filed in any state or
jurisdiction to register or qualify any or all
of the Shares or to claim an exemption
therefrom, or provided to any state or
jurisdiction to exempt the Company as a
broker-dealer or its officers, directors and
employees as broker-dealers or agent, under
the securities laws thereof (collectively, the
"Blue Sky Application"), or any document,
advertisement, oral statement or communication
("Sales Information") prepared, made or
executed by or on behalf of the Company or the
Bank with their consent or based upon written
or oral information furnished by or on behalf
of the Company or the Bank, whether or not
filed in any jurisdiction, in order to qualify
or register the Shares or to claim an
exemption therefrom under the securities laws
thereof; (ii) arise out of or based upon the
omission or alleged omission to state in any
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39
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 (iii) arise from any theory of
liability whatsoever relating to or arising from or
based upon the Registration Statement (or any
amendment or supplement thereto), preliminary or
final Prospectus (or any amendment or supplement
thereto), the Conversion Application (or any
amendment or supplement thereto), any Blue Sky
Application or Sales Information or other
documentation distributed in connection with the
Conversion; 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 statement or alleged untrue
material statement in, or material omission or
alleged material omission from, the Registration
Statement (or any amendment or supplement thereto),
preliminary or final Prospectus (or any amendment or
supplement thereto), the Conversion Application, any
Blue Sky Application or Sales Information made in
reliance upon and in conformity with information
furnished in writing to the Company or the Bank by
the Agent or its counsel regarding the Agent and,
provided further, that such indemnification shall be
to the extent permitted by the Commissioner, the OTS,
the FDIC and the Board of Governors of the Federal
Reserve.
(b) The Agent agrees to indemnify and hold harmless the
Company and the Bank, their directors and officers
and each person, if any, who controls the Company or
the Bank within the meaning of Section 15 of the 1933
Act or Section 20(a) of the 1934 Act against any and
all loss, liability, claim, damage or expense
whatsoever (including but not limited to settlement
expenses), 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, the Bank, and any such persons upon written
demand for any expenses (including reasonable fees
and disbursements of counsel) incurred by them, or
any of them, in connection with investigating,
preparing or defending any actions, proceedings or
claims (whether commenced or threatened) to the
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40
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 the Registration Statement (or any
amendment or supplement thereto), the Conversion
Application (or any amendment or supplement thereto),
the preliminary or final Prospectus (or any amendment
or supplement thereto), any Blue Sky Application or
Sales Information or are based upon the omission or
alleged omission to state in any of the foregoing
documents a material fact required to be stated
therein or necessary to make the statements therein,
in the light of the circumstances under which they
were made, not misleading; provided, however, that
the Agent's obligations under this Section 8(b) shall
exist only if and only to the extent (i) that such
untrue statement or alleged untrue statement was made
in, or such material fact or alleged material fact
was omitted from, the Registration Statement (or any
amendment or supplement thereto), the preliminary or
final Prospectus (or any amendment or supplement
thereto), the Conversion Application (or any
amendment or supplement thereto), any Blue Sky
Application or Sales Information in reliance upon and
in conformity with information furnished in writing
to the Company or the Bank by the Agent or its
counsel regarding the Agent. It is expressly agreed,
however, 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 fees paid to the Agent pursuant
to Section 2 of this Agreement (not including
expenses).
(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 8 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 defense of such action with counsel
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41
chosen by it and approved by 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
(and any special counsel that said firm may retain)
for each indemnified party in connection with any one
action, proceeding or claim or separate but similar
or related actions, proceedings or claims in the same
jurisdiction arising out of the same general
allegations or circumstances.
(d) The agreements contained in this Section 8 and
in Section 9 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
agent or their officers, directors or
controlling persons, agent or employees or by
or on behalf of the Company or the Bank or any
officers, directors or controlling persons,
agent or employees of the Company or the Bank;
(ii) delivery of and payment hereunder for the
Shares; or (iii) any termination of this
Agreement.
SECTION 9. CONTRIBUTION. In order to provide for just and equitable
contribution in circumstances in which the indemnification provided for in
Section 8 is due in accordance with its terms but is for any reason held by a
court to be unavailable from the Company, the Bank or the Agent, the Company,
the Bank and the Agent shall contribute to the aggregate losses, claims, damages
and liabilities (including any investigation, legal and other expenses incurred
in connection with, and any amount paid in settlement of, any action, suit or
proceeding of any claims asserted, but after deducting any contribution received
by the Company, the Bank or the Agent from persons other than the other party
thereto, who may also be liable for contribution) in such proportion so that the
Agent is responsible for that portion represented by the percentage that the
fees paid to the Agent pursuant to Section 2 of this Agreement (not including
expenses) bears to the gross proceeds received by the Company from the sale
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of the Shares in the Offering, and the Company and the Bank shall be responsible
for the balance. If, however, the allocation provided above is not permitted by
applicable law or if the indemnified party failed to give the notice required
under Section 8 above, then each indemnifying party shall contribute to such
amount paid or payable by such indemnified party in such proportion as is
appropriate to reflect not only such relative fault of the Company and the Bank
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 thereto), but also the relative
benefits received by the Company and the Bank on the one hand and the Agent on
the other from the Offering (before deducting expenses). 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 and/or
the Bank 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, the Bank and the Agent 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 into account the equitable considerations referred to above
in this Section 9. The amount paid or payable by an indemnified party as a
result of the losses, claims, damages or liabilities (or actions, proceedings or
claims in respect thereof) referred to above in this Section 9 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 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 0000
Xxx) shall be entitled to contribution from any person who was not found guilty
of such fraudulent misrepresentation. The obligations of the Company and the
Bank under this Section 9 and under Section 8 shall be in addition to any
liability which the Company and the Bank may otherwise have. For purposes of
this Section 9, each of the Agent's, the Company's or the Bank's officers and
directors and each person, if any, who controls the Agent or the Company or the
Bank within the meaning of the 1933 Act and the 1934 Act shall have the same
rights to contribution as the Agent, the Company or the Bank. 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 9, will notify
such party from whom contribution may be sought, but the omission to so notify
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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
9.
SECTION 10. SURVIVAL OF AGREEMENTS, REPRESENTATIONS AND INDEMNITIES.
The respective indemnities of the Company, the Bank and the Agent and the
representations and warranties and other statements of the Company, the Bank and
the Agent 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 on behalf of the Agent, the Company,
the Bank or any controlling person referred to in Section 8 hereof, and shall
survive the issuance of the Shares, and any successor or assign of the Agent,
the Company, the Bank, and any such controlling person shall be entitled to the
benefit of the respective agreements, indemnities, warranties and
representations.
SECTION 11. TERMINATION. Xxxx may terminate this Agreement
by giving the notice indicated below in this Section 11 at any time
after this Agreement becomes effective as follows:
(a) In the event the Company fails to sell the
required minimum number of the Shares by
September 30, 1997, and in accordance with the
provisions of the Plan or as required by the
Conversion Regulations, and applicable law,
this Agreement shall terminate upon refund by
the Company to each person who has subscribed
for or ordered any of the Shares the full
amount which it may have received from such
person, together with interest as provided in
the Prospectus, and no party to this Agreement
shall have any obligation to the other
hereunder, except for payment by the Company
and/or the Bank as set forth in Sections 2(a),
6, 8 and 9 hereof.
(b) If any of the conditions specified in Section
7 shall not have been fulfilled when and as
required by this Agreement unless waived in
writing, or by the Closing Date, this
Agreement and all of the Agent's obligations
hereunder may be cancelled by the Agent by
notifying the Company and the Bank of such
cancellation in writing or by telegram at any
time at or prior to the Closing Date, and any
such cancellation shall be without liability
of any party to any other party except as
otherwise provided in Sections 2(a), 6, 8 and
9 hereof.
(c) If Xxxx elects to terminate this Agreement as
provided in this Section , the Company and the Bank
shall be notified promptly by telephone or telegram,
confirmed by letter.
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The Company and the Bank may terminate this Agreement in the event Xxxx
is in material breach of the representations and warranties or covenants
contained in Section 5 and such breach has not been cured after the Company and
the Bank have provided Xxxx with notice of such breach.
This Agreement may also be terminated by mutual written consent of the
parties hereto.
SECTION 12. NOTICES. All communications hereunder, except as
herein otherwise specifically provided, shall be mailed in writing
and if sent to Xxxx shall be mailed, delivered or telegraphed and
confirmed to Xxxxxxx Xxxx & Company, 000 Xxxxxxxxx, Xxxxxx, Xxxx
00000-0000, Attention: Xxxxxxxx X. XxXxxxx (with a copy to Silver,
Xxxxxxxx & Taff, L.L.P., Attention: Xxxxxxx X. Xxxxxxx, P.C. and,
if sent to the Company and the Bank, shall be mailed, delivered or
telegraphed and confirmed to the Company and the Bank at 00 Xxxx
Xxxx Xxxxxx, Xxxxxxxxxxx, Xxxx 00000, Attention: Xxxxxxx X. Xxxxx,
President (with a copy to Vorys, Xxxxx, Xxxxxxx and Xxxxx,
Attention: Xxxx X. Xxxxxxx).
SECTION 13. PARTIES. The Company and the Bank shall be entitled to act
and rely on any request, notice, consent, waiver or agreement purportedly given
on behalf of the Agent when the same shall have been given by the undersigned.
The Agent shall be entitled to act and rely on any request, notice, consent,
waiver or agreement purportedly given on behalf of the Company or the Bank, when
the same shall have been given by the undersigned or any other officer of the
Company or the Bank. This Agreement shall inure solely to the benefit of, and
shall be binding upon, the Agent, the Company, the Bank, and their respective
successors 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. It is understood and
agreed that this Agreement is the exclusive agreement among the parties hereto,
and supersedes any prior agreement among the parties and may not be varied
except in writing signed by all the parties.
SECTION 14. CLOSING. The closing for the sale of the Shares shall take
place on the Closing Date at such location as mutually agreed upon by the Agent
and the Company and the Bank. At the closing, the Company and the Bank shall
deliver to the Agent in next day funds the commissions, fees and expenses due
and owing to the Agent as set forth in Sections 2 and 6 hereof and the opinions
and certificates required hereby and other documents deemed reasonably necessary
by the Agent shall be executed and delivered to effect the sale of the Shares as
contemplated hereby and pursuant to the terms of the Prospectus.
SECTION 15. 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 circumstances
or situation
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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 16. CONSTRUCTION. This Agreement shall be construed in
accordance with the laws of the State of Ohio.
SECTION 17. COUNTERPARTS. This Agreement may be executed in separate
counterparts, each of which so executed and delivered shall be an original, but
all of which together shall constitute but one and the same instrument.
If the foregoing correctly sets forth the arrangement among the
Company, the Bank and Xxxx, please indicate acceptance thereof in the space
provided below for that purpose, whereupon this letter and the Agent's
acceptance shall constitute a binding agreement.
SECTION 18. ENTIRE AGREEMENT. This Agreement, including schedules and
exhibits hereto, which are integral parts hereof and incorporated as though set
forth in full, constitutes the entire agreement between the parties pertaining
to the subject matter hereof superseding any and all prior or contemporaneous
oral or prior written agreements, proposals, letters of intent and
understandings, and cannot be modified, changed, waived or terminated except by
a writing which expressly states that it is an amendment, modification or
waiver, refers to this Agreement and is signed by the party to be charged. No
course of conduct or dealing shall be construed to modify, amend or otherwise
affect any of the provisions hereof.
Very truly yours,
HOME CITY FINANCIAL CORPORATION HOME CITY FEDERAL SAVINGS BANK
By: By:
---------------------------- ------------------------------
Xxxxxxx X. Xxxxx Xxxxxxx X. Xxxxx
President President
Accepted as of the date first above written
XXXXXXX XXXX & COMPANY, A DIVISION OF
XXXXX, XXXXXXXX & XXXXX, INC.
By:
----------------------------------------
Xxxxxxxx X. XxXxxxx
Executive Vice President
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