FIRST NILES FINANCIAL, INC.
Up to _______ Shares of Common Stock
(Par Value $.01 Per Share)
Purchase Price $10.00 Per Share
AGENCY AGREEMENT
___________________, 1998
Xxxxxxx Xxxx & Company, a Division of Xxxxx, Xxxxxxxx & Xxxxx, Inc.
000 Xxxxxxxxx Xxxxxx
Xxxxxx, Xxxx 00000-0000
Ladies and Gentlemen:
First Niles Financial, Inc., Niles, Ohio, a Delaware corporation
("Company"), and Home Federal Savings and Loan Association of Niles, Niles, Ohio
("Association"), a federally chartered mutual savings and loan association 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 Xxxxx, Xxxxxxxx & Xxxxx, Inc., doing business
through its division Xxxxxxx Xxxx & Company (the "Agent"), as follows:
Section 1. The Offering. The Association, in accordance with an amended
plan of conversion ("Plan") adopted by its Board of Directors, intends to
convert from a federally chartered mutual savings and loan association to a
federally chartered stock savings and loan association and to issue all of its
outstanding capital stock to the Company. Unless the context requires otherwise,
all references to "Association" herein shall include the Association in its
mutual and in its converted form as a federal stock savings and loan
association.
Pursuant to the Plan, the Company will offer and sell up to ___________
(subject to adjustment up to ___________) shares of its common stock, no par
value ("Shares" or "Common Stock"), in a subscription offering ("Subscription
Offering") to (i) Eligible Account Holders, (ii) the Association's employee
stock ownership plan (the "ESOP"), (iii) Supplemental Eligible Account Holders,
(iv) Other Members and (v) directors, officers and employees, as those terms are
defined in the Plan. The Company shall offer any Shares not subscribed for in
the Subscription Offering for sale in a community offering ("Community Offering"
and, when referred to together with the Subscription Offering, the "Subscription
and Community Offering") to certain members of the general public to whom a copy
of the Prospectus (as hereinafter defined) is delivered, with preference given
first to natural persons who reside in the Local Community, as defined in the
Plan. If any Shares are not subscribed for or purchased in the Subscription and
Community Offering, the Agent, at the request of the Company and the
Association, shall seek to form a syndicate of selected
registered broker-dealers to assist in the sale of such Shares on a best efforts
basis in a syndicated community offering ("Syndicated Community Offering"). It
is acknowledged that the purchase of the Shares is subject to the purchase
limitations described in the Plan and that the Company and the Association may
reject, in whole or in part, any orders received in the Community Offering or
the Syndicated Community Offering. The Subscription Offering, Community Offering
and Syndicated Community Offering are collectively referred to as the
"Offering." Collectively, the Offering and the other activities described in the
Plan are referred to herein as the "Conversion."
The Company has filed with the Securities and Exchange Commission
("Commission") a registration statement on Form SB-2 (File No. ___________),
including exhibits ("Registration Statement"), containing a prospectus relating
to the Offering, for the registration of the Shares under the Securities Act of
1933 ("1933 Act"), and has filed such amendments and supplements thereto, if
any, and such amended prospectuses and supplemental prospectuses as may have
been required to the date hereof. The prospectus, as amended, on file with the
Commission at the time the Registration Statement initially becomes 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 ("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.
The Association has filed with the Office of Thrift Supervision ("OTS")
an Application for Approval of Conversion, including exhibits ("Conversion
Application"), including the Prospectus contained therein, and has filed such
amendments or supplements thereto, if any, as may have been required pursuant to
the Home Owners' Loan Act, as amended ("HOLA"), and 12 C.F.R. Part 563b
("Conversion Regulations"). In addition, the Company has filed with the OTS an
application on Form H-(e)1-S, including exhibits ("Holding Company
Application"), and has filed such amendments or supplements thereto, if any, as
may have been required to become a registered savings and loan holding company
under the HOLA.
Section 2. Retention of Agent; Compensation and Expenses; Sale and
Delivery of the Shares. Subject to the terms and conditions herein set forth,
the Company and the Association hereby appoint the Agent as their exclusive
financial advisor and marketing agent to utilize its best efforts to solicit
subscriptions for the Shares and to advise and assist the Company and the
Association with respect to the sale of the Shares in the Offering.
On the basis of the representations and warranties and the agreements
herein, but subject to the terms and conditions herein, the Agent accepts such
appointment and agrees to consult with and advise the Company and the
Association as to the matters set forth in the letter agreement dated March 10,
1998 ("Letter Agreement"), between the Association and the Agent. The Agent
shall not be required to purchase any Shares or take any action inconsistent
with all applicable laws, regulations, decisions or orders. In the event of the
Syndicated Community Offering, the Agent shall seek to assemble and manage a
selling group of selected registered broker-dealers which are members of the
National Association of Securities Dealers, Inc. ("NASD") to participate in the
solicitation of purchase orders for shares under a selected dealers' agreement
in the form attached hereto as Exhibit A.
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The obligations of the Agent pursuant to this Agreement shall terminate
upon the completion, termination or abandonment of the Plan by the Association
or upon termination of the Offering, but in no event later than January 30, 1999
("End Date"), unless otherwise specifically provided in this Agreement. All
unpaid fees and expenses due to the Agent shall be payable 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 Association
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 ___________
Shares within the period herein provided, this Agreement shall terminate and the
Company shall refund to all persons who have subscribed for any of the Shares,
the full amount of their subscriptions 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 8, 9, and 10 hereof.
In the event the Offering is 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 the fees and expenses accruing to the date of such
termination pursuant to this Section 2.
If all conditions precedent to the consummation of the Conversion,
including, without limitation, the receipt of subscriptions for the minimum
number of Shares permitted to be sold in the Conversion on the basis of the most
recent updated appraisal report and compliance by the Company and the
Association of the conditions set forth in Section 7 hereof to the reasonable
satisfaction of the Agent and its counsel, are satisfied, the Company ages to
issue, or have issued, the Shares sold in the Offering and 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. The release
of Shares against payment therefor shall be made at a time, date and place
mutually acceptable to the Company, the Association 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 in four consecutive monthly
installments, of which $25,000 has been paid.
(b) A success fee equal to 1.5 % of the aggregate purchase price of the
Shares sold in the Subscription and Community Offering excluding Shares
subscribed or purchased by the Association's officers, directors or employees
(or their immediate family members) or by the ESOP or any tax-qualified or
stock-based compensation plans (except Individual Retirement Accounts) or
similar plan created by the Association for some or all of its directors or
employees. The management fee described in the paragraph (a) will be applied
against the success fee.
(c) For Shares sold in the Syndicated Community Offering by selected
broker-dealers, the Agent shall receive a fee not to exceed 5.5% of the
aggregate purchase price of the Shares sold
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by such selected broker-dealers, and the Agent shall pass on to such selected
broker-dealers an amount competitive with gross underwriting discounts charged
at such time for comparable amounts of stock sold at a comparable price per
share in a similar market environment. In the event any fees are paid pursuant
to this subsection (c), such fees shall be in lieu of, and not in addition to,
the fees paid pursuant to subsection (b) above. Fees with respect to purchases
effected with the assistance of broker-dealers other than the Agent shall be
transmitted by the Agent to such broker-dealer.
Whether or not the Conversion is completed or the sale of the Shares by
the Company is consummated, the Company and the Association jointly and
severally agree to pay or reimburse the Agent, from time to time upon the
Agent's request, for (a) the reasonable legal fees and expenses of its counsel,
not to exceed $35,000, and (b) reasonable out-of-pocket expenses related to
travel, meals, lodging, photocopying, facsimile and couriers, not to exceed
$10,000.
The Company and the Association shall bear the expenses of the Offering
customarily borne by issuers including, without limitation, OTS, Commission,
"Blue Sky," and NASD filing and registration fees; the fees of the Association's
accountants, attorneys, appraiser, transfer agent and registrar, and other agent
fees and expenses; any stock issue or transfer taxes; printing, mailing and
marketing and syndicate expenses associated with the Conversion.
Full payment of the Agent's fees and expenses, as described above,
shall be made in next day funds on the earlier of the Closing Date or the End
Date.
The Agent further agrees to provide financial advisory assistance to
the Company and the Association for a period of one year following completion of
the Conversion, including formation of a dividend policy and share repurchase
program, assistance with shareholder reporting and shareholder relations
matters, general advice on mergers and acquisitions and other related financial
matters, without the payment by the Company and the Association of any fees in
addition to those set forth in this Section 2.
Section 3. Representations and Warranties of the Company and
Association. The Company and the Association jointly and severally represent and
warrant to the Agent as follows:
(a) The Registration Statement has been declared effective by the
Commission; at the time the Registration Statement, including the Prospectus
contained therein, became effective, the Registration Statement, including the
Prospectus contained therein, complied as to form 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, and any
information regarding the Company or the Association contained in Sales
Information (as such term is defined in Section 11 hereof) authorized by the
Company or the Association 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, the
Registration Statement, including the Prospectus contained therein (including
any amendment or supplement thereto), and any information regarding the Company
or the Association contained in Sales Information (as such term is defined in
Section 8 hereof) authorized by the Company or the Association for use in
connection with the Offering did not contain an untrue
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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 3(a) shall not apply to statements or omissions made
in reliance upon and in conformity with written information furnished to the
Company or the Association by the Agent expressly regarding the Agent for use in
the Prospectus under the captions "Market for the Common Stock" and "The
Conversion--Marketing Arrangements."
(b) The Conversion Application has been approved by the OTS and the
related Prospectus and the proxy statement of the Association relating to the
special meeting of members at which the Plan shall be considered for approval by
the Association's eligible voting members have been authorized for use by the
OTS; at the time of the approval of the Conversion Application, including the
Prospectus contained therein, and as of the date of this Agreement, the
Conversion Application, including the Prospectus, complied as to form in all
material respects with the Conversion Regulations. At the time of the approval
of the Conversion Application, including the Prospectus contained therein, and
as of the date of this Agreement, the Conversion Application, including the
Prospectus contained therein, did not contain 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 3(b) shall not apply to statements or omissions made
in reliance upon and in conformity with written information furnished to the
Company or the Association by the Agent expressly regarding the Agent for use in
the Prospectus under the captions "Market for the Common Stock" and "The
Conversion--Marketing Arrangements."
(c) The Holding Company Application has been approved by the OTS. At
the time of the approval of the Holding Company Application and as of the date
of this Agreement, the Holding Company Application complied as to form in all
material respects with all applicable regulations.
(d) No order has been issued by the OTS, the Commission or any other
governmental agency preventing or suspending the use of the Prospectus, and no
action by or before any governmental entity to revoke any approval,
authorization or order of effectiveness related to the Conversion is pending or,
to the best knowledge of the Company and the Association, threatened.
(e) The Plan complies with the Conversion Regulations, has been adopted
by the Board of Directors of the Association as required by the Conversion
Regulations and has been adopted by the Board of Directors of the Company.
(f) To the best knowledge of the Company and the Association, no person
has sought to obtain review of the final action of the OTS in approving the Plan
or in approving the Conversion Application or the Holding Company Application
pursuant to the HOLA, the Conversion Regulations, state securities laws and
regulations (collectively, the "Blue Sky Laws"), or any other statute or
regulation.
(g) The Association has been duly organized and is validly existing as
a federally chartered savings bank in mutual form of organization in good
standing under the laws of the United States and is duly authorized to conduct
its business and own its property as described in the
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Registration Statement and the Prospectus; the Association has obtained all
licenses, permits and other governmental authorizations required for the conduct
of its business except where the failure to obtain such licenses, permits or
other governmental authorizations would not materially adversely affect the
financial condition, earnings, capital, assets or properties of the Company and
the Association taken as a whole; all such licenses, permits and governmental
authorizations are in full force and effect and the Association is complying
therewith in all material respects; the Association is duly qualified as a
foreign corporation to transact business in each jurisdiction in which the
failure to be so qualified in one or more of such jurisdictions would have a
material adverse effect on the financial condition, earnings, capital, assets
properties or business of the Association.
(h) The Association does not own any equity securities or any equity
interest in any business enterprise except as described in the Prospectus.
(i) The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Delaware, 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; the Company is qualified to do business as a foreign corporation in
Ohio and 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 financial condition, earnings, capital, assets, properties
or the business of the Company; the Company has obtained all licenses, permits
and other governmental authorizations currently required for the conduct of its
business except where the failure to obtain such licenses, permits or other
governmental authorizations would not materially adversely affect the financial
condition, earnings, capital, assets or properties of the Company and the
Association taken as a whole; and all such licenses, permits and governmental
authorizations are in full force and effect, and the Company is complying in all
material respects therewith.
(j) The Association is a member of the Federal Home Loan Bank of
Cincinnati ("FHLB- Cincinnati"); the deposit accounts of the Association are
insured by the FDIC under the SAIF up to applicable legal limits; and no
proceedings for the termination or revocation of such membership or insurance
are pending or, to the best knowledge of the Association, threatened.
(k) The Company and the Association have good and marketable title to
all real property and good title to all other assets material to the business of
the Company and the Association and to those properties and assets described in
the Registration Statement and Prospectus as owned buy them, free and clear of
all liens, charges, encumbrances or restrictions, except as described therein or
are not material to the business of the Company and the Association, taken as a
whole; and all of the leases and subleases material to the business of the
Company and the Association, including those described in the Registration
Statement and Prospectus, are in full force and effect and the Company and the
Association are complying therewith in all material respects.
(l) The Company and the Association have received an opinion of Silver,
Xxxxxxxx & Xxxx, L.L.P., with respect to the income tax consequences of the
Conversion as described in the Registration Statement and Prospectus; and the
facts and representations upon which such opinions are based are true, accurate
and complete, and neither the Company nor the Association has taken any actions
inconsistent therewith.
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(m) The Company and the Association have all such power, authority,
authorizations, approvals and orders, except approval or confirmation of the
final appraisal of the Association, as may be required to enter into this
Agreement, to carry out the provisions and conditions hereof and to issue and
sell (i) the capital stock of the Association to the Company and (ii) 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 Association and this Agreement has been validly executed
and delivered by the Company and the Association and is the valid, legal and
binding Agreement of the Company and the Association enforceable in accordance
with its terms, except as the enforceability thereof may be limited by (i)
bankruptcy, insolvency, moratorium, reorganization, conservatorship,
receivership or other similar laws relating to or affecting the enforcement or
creditors' rights generally or the rights of creditors of insured financial
institutions and their holding companies, the accounts of whose subsidiaries are
insured by the FDIC or (ii) 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.
(n) The execution, delivery and performance of this Agreement by the
Company and the Association will not: (i) conflict with or constitute a breach
of, or default under, the certificate of incorporation and bylaws of the Company
or the charter and bylaws of the Association (in either mutual or capital stock
form), or any material contract, lease or other instrument to which the Company
or the Association is a party, or any applicable law, rule, regulation or order;
(ii) violate any authorization, approval, judgment, decree, order, statute, rule
or regulation applicable to the Company or the Association, except for such
violation which would not have a material adverse effect on the financial
condition and results of operations of the Company and the Association 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 Association.
(o) 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 (other than in connection with the incorporation of the
Company); the Shares 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 (except for Subscription Rights granted
pursuant to the Plan); 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 Association, 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.
(p) The Company and the Association are not in violation of any
directive from the OTS, FDIC or any other governmental agency to make any
material change in the method of conducting
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their businesses so as to comply in all material respects with all applicable
statutes and regulations and, except as set forth in the Registration Statement
and the Prospectus, there is no suit, proceeding, charge or action before or by
any court, regulatory authority or governmental agency or body, pending or, to
the best knowledge of the Company and the Association, threatened, which might
materially and adversely affect the Conversion, the performance of this
Agreement, the consummation of the transactions contemplated by the Plan and as
described in the Registration Statement and the Prospectus or which might have a
material adverse effect on the financial condition, earnings, capital,
properties, assets or business of the Company or the Association, taken as a
whole.
(q) The financial statements of the Association which are included in
the Registration Statement, the Conversion Application and the Prospectus
present fairly the financial condition, results of operations, retained earnings
and cash flows of the Association at the respective dates thereof and for the
respective periods covered thereby, and comply as to form in all material
respects with the applicable accounting requirements of the Conversion
Regulations, Regulation S-X of the Commission, and generally accepted accounting
principles ("GAAP") consistently applied through the periods involved (except as
noted therein). Such financial statements are consistent with the most recent
financial statements and other reports filed by the Association with the OTS,
except that accounting principles employed in such regulatory filings conform to
the requirements of such authorities and not necessarily to GAAP. 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
Association included in the Registration Statement and the Prospectus, and as to
the pro forma adjustments, the adjustments made therein have been properly
applied on the bases described therein.
Since the respective dates as of which information is given in the
Registration Statement and the Prospectus, except as may otherwise be stated
therein: (i) there has not been any material adverse change in the financial
condition, earnings, capital, properties or business of the Company and the
Association, considered as one enterprise, whether or not arising in the
ordinary course of business; (ii) there has not been any material increase in
loans past due 90 days or more or in real estate acquired by foreclosure, by
deed-in-lieu of foreclosure, or deemed in-substance foreclosure; (iii) there has
not been any material decrease in surplus and reserves or total assets of the
Association; (iv) neither the Company nor the Association has issued any
securities or incurred any liability or obligation for borrowing other than in
the ordinary course of business; (v) there have not been any transactions
entered into by the Company or the Association, except with respect to those
transactions entered into in the ordinary course of business; (vi) the
properties and business of the Company and the Association conform in all
material respects to the descriptions thereof contained in the Prospectus; and
(vii) neither the Company nor the Association has any material contingent
liabilities except as disclosed in the Prospectus.
(s) Neither the Company nor the Association is in violation of its
certificate of incorporation or bylaws or charter or bylaws, as applicable, or
in default in the performance or observance of any obligation, agreement,
covenant, or condition contained in any 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, which would result in a material adverse effect on
the financial condition, earnings, capital, assets, properties or business of
the Company and the Association, considered as one enterprise.
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(t) 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 or
the Association 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 instrument or agreement to which the Company or the
Association 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 effect
on the financial condition, earnings, capital, assets, properties or business of
the Company and the Association, considered as one enterprise; and 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 and the
Association, threatened any action or proceeding wherein the Company or the
Association might be alleged to be in default thereunder under circumstances
where such action or proceeding, if determined adversely to the Company or the
Association, would have a material adverse effect on the financial condition,
earnings, capital, assets, properties or business of Company and the
Association, considered as one enterprise.
(u) 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 approvals of the OTS and
the Commission, and any necessary qualification, notification, registration or
exemption under the Blue Sky Laws of the various jurisdictions in which the
Shares are to be offered.
(v) VonLehman & Company, Inc., which has certified the financial
statements of the Association contained in the Registration Statement,
Conversion Application, and the Prospectus, are, with respect to the Company and
the Association, independent public accountants within the meaning of the Code
of Professional Ethics of the American Institute of Certified Public
Accountants, the Conversion Regulations, and the 1933 Act Regulations.
(w) Xxxxxx & Company, Inc., which has prepared the Conversion Valuation
Appraisal Report as of June 26, 1998, as amended or supplemented, if so amended
or supplemented ("Appraisal"), is independent of the Company and the Association
within the meaning of the Conversion Regulations.
(x) The Company and the Association have timely filed all required
federal, state and local tax returns; and the Company and the Association have
paid all taxes due and payable in respect of such returns, except where
permitted to be extended, and have made adequate reserves for similar future tax
liabilities and no deficiency has been asserted with respect thereto by any
taxing authority.
(y) The Association complies in all material respects with the
applicable financial recordkeeping and reporting requirements of the Currency
and Foreign Transactions Reporting Act of 1970, as amended, and the regulations
and rules thereunder.
(z) To the knowledge of the Company and the Association, neither the
Company nor the Association has lent any funds for the purchase of Shares or has
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.
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(aa) Neither the Company nor the Association has: (i) issued any
securities within the last 18 months (except for notes to evidence other bank
loans or other liabilities in the ordinary course of business or as described in
the Prospectus and except for shares issued in connection with the incorporation
of the Company); (ii) had any dealings within the immediate prior 12 months with
any NASD member, or any person related to or associated with such member, other
than discussions and meetings relating to the Offering and purchases and sales
of United States government and agency and other securities in the ordinary
course of business; (iii) entered into a financial or management consulting
agreement except as contemplated hereunder and except for the Letter Agreement;
and (iv) engaged any intermediary other than the Agent in connection with the
Offering, and no person is being compensated in any manner for such service.
(bb) The Company and the Association have not relied upon the Agent or
the Agent's counsel for any legal, tax or accounting advice in connection with
the Conversion.
(cc) All documents delivered by the Association or the Company or their
representatives in connection with the issuance and sale of the Common Stock and
the Agent's exercise of due diligence, were, on the dates on which they were
delivered, accurate and complete in all material respects or were amended in
writing to be accurate and complete in all material respects.
(dd) The records of Eligible Account Holders, Supplemental Eligible
Account Holders and Other Members are accurate and complete in all material
respects.
(ee) To the best knowledge of the Company and the Association, the
Company and the Association comply with all laws, rules and regulations relating
to environmental protection, and neither the Company nor the Association has
been notified or is otherwise aware that either of them is potentially liable,
or is considered potentially liable, under the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended, or any other
Federal, state or local environmental laws and regulations; no action, suit,
regulatory investigation or other proceeding is pending, or to the best
knowledge of the Company and the Association, threatened against the Company or
the Association relating to environmental protection, nor does the Company or
the Association have any reason to believe any such proceedings may be brought
against either of them; and to the best knowledge of the Company and the
Association, no disposal, release or discharge of hazardous or toxic substances,
pollutants or contaminants, including petroleum and gas products, as any of such
terms may be defined under federal, state or local law, has occurred on, in, at
or about any facilities or properties owned or leased by the Company or the
Association or in which the Association has a security interest.
Any certificate signed by an officer of the Company or the Association
pursuant to the conditions of this Agreement and delivered to the Agent or its
counsel that refers to this Agreement shall be deemed to be a representation and
warranty by the Company or the Association to the Agent as to the matters
covered thereby with the same effect as if such representation and warranty were
set forth herein.
Section 4. Representations and Warranties of the Agent.
The Agent represents and warrants to the Company and the Association
that:
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(a) Xxxxx, Xxxxxxxx & Xxxxx, Inc. is a corporation in good standing
under the laws of the State of New York with full power and authority to provide
the services to be furnished to the Association and the Company hereunder, and
Xxxxxxx Xxxx & Company is an unincorporated division of Xxxxx, Xxxxxxxx & Xxxxx,
Inc.
(b) The execution and delivery of this Agreement and the consummation
of the transactions contemplated hereby have been duly and validly authorized by
all necessary corporate action on the part of the Agent, and this Agreement has
been duly and validly executed and delivered by the Agent and is the legal,
valid and binding agreement of the Agent, enforceable in accordance with its
terms, except as the enforceability thereof may be limited by (i) bankruptcy,
insolvency, moratorium, reorganization, conservatorship, receivership or other
similar laws relating to or affecting the enforcement or creditors' rights
generally, or (ii) general equity principles regardless of whether such
enforceability is considered in a proceeding in equity or at law.
(c) The execution and delivery of this Agreement by the Agent, the
consummation of the transactions contemplated hereby and compliance with the
terms and provisions hereof shall not conflict with, or result in a breach of,
any of the terms, provision or conditions of, or constitute a default (or event
which with notice or lapse of time or both would constitute a default) under,
the articles of incorporation of Xxxxx, Xxxxxxxx & Xxxxx, Inc. or any material
agreement, indenture or other instrument to which the Agent is a party or by
which it or its property is bound.
(d) The Agent and its employees, and to the best knowledge of the
Agent, its agents and representatives, who shall perform any of the services
hereunder shall be duly authorized and empowered, and shall have all licenses,
approvals and permits necessary to perform such services.
(e) No approval of any regulatory, supervisory or other public
authority other than the NASD is required in connection with the Agent's
execution and delivery of this Agreement, and the approval of the NASD has been
received.
(f) There is no suit, proceeding, charge, or action before or by any
court, regulatory authority or government agency or body pending or, to the best
knowledge of the Agent, threatened, which might materially and adversely affect
the Agent's performance of this Agreement.
Section 5. Covenants of the Company and the Association. The Company
and the Association hereby jointly and severally covenant with the Agent as
follows:
(a) The Company will not file any amendment or supplement to the
Registration Statement without providing the Agent and its counsel an
opportunity to review such amendment or supplement, and will not file any
amendment or supplement to which the Agent or its counsel shall reasonably
object.
(b) The Association will not file any amendment or supplement to the
Conversion Application without providing the Agent and its counsel an
opportunity to review such amendment or supplement, and will not file any
amendment or supplement to which the Agent or its counsel shall reasonably
object.
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(c) At any time after the Holding Company Application is approved by
the OTS, the Company will not file any amendment or supplement to the Holding
Company Application without providing the Agent and its counsel an opportunity
to review such amendment or supplement, and will not file any amendment or
supplement to which the Agent or its counsel will reasonably object.
(d) The Company and the Association shall notify the Agent in writing
of any violation of its certificate of incorporation and bylaws, in the case of
the Company, and its charter and bylaws, in the case of the Association, at any
time after the date hereof and prior to the Closing Date. Unless waived in
writing by the Agent, which waiver shall not be unreasonably withheld, the
Company shall not be in violation of its certificate of incorporation or bylaws,
and the Association shall not be i violation of its charter or bylaws, at any
time after the date hereof and prior to the Closing Date.
(e) The Company and the Association 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-approval amendment to the Conversion
Application to be approved by the OTS, and will immediately notify the Agent
upon receipt of any information concerning any of the following events: (i) when
any post-effective amendment to the Registration Statement has become effective;
(ii) when any post-approval amendment to the Conversion Application has been
approved; (iii) when any post-approval amendment to the Holding Company
Application has been approved; (iv) when any comments from the Commission, the
OTS, or any other governmental entity are issued with respect to the
Registration Statement, Conversion Application, Holding Company Application, or
the transactions contemplated by this Agreement; (v) when any request is made by
the Commission, the OTS or any other governmental entity for any amendment or
supplement to the Registration Statement, the Conversion Application or the
Holding Company Application, or for any other additional information; (vi) when
the Commission, the OTS or any other governmental entity issues any order or
takes or threatens any action to suspend the Offering, the effectiveness of the
Registration Statement, or the use of the Prospectus or any other filing of the
Company or the Association under the Conversion Regulations, or other applicable
law; (vii) the issuance by the Commission, the OTS or any other governmental
authority of any stop order suspending the effectiveness of the Registration
Statement or the approval of the Conversion Application or the Holding Company
Application, or of the initiation or threat of initiation of any proceedings for
any such purpose; or (viii) the occurrence of any event mentioned in paragraph
(j) below; and the Company and the Association will make every reasonable effort
to prevent the issuance by the Commission, the OTS or any state authority of any
order referred to in (vi) and (vii) above, and if any such order shall at any
time be issued, to obtain the lifting thereof at the earliest possible time.
(f) As of the Closing Date, the Association shall have all approvals
and authority to issue and sell the capital stock of the Association to the
Company and the Company shall have such approvals and orders to issue and sell
the Shares as provided for herein and as described in the Prospectus.
(g) The Company and the Association shall 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. The Company and the
Association shall also deliver such additional copies of the foregoing documents
to counsel to the Agent as may be required for any NASD filings.
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(h) The Company and the Association will furnish to the Agent, from
time to time during the period when the Prospectus is required to be delivered
under the 1933 Act or the Securities Exchange Act of 1934 ("1934 Act"), such
number of copies of such Prospectus 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 ("1934 Act
Regulations"); and the Company and the Association authorize the Agent to use
the Prospectus in any lawful manner contemplated by the Plan in connection with
the sale of the Shares.
(i) The Company and the Association will comply with any and all terms,
conditions, requirements and provisions with respect to the Conversion and the
transactions contemplated thereby imposed by the Commission and the OTS and by
the 1933 Act, the 1933 Act Regulations, the 1934 Act and the 1934 Act
Regulations, to be complied with subsequent to the Closing Date; and when the
Prospectus is required to be delivered, the Company and the Association shall
comply, at their own expense, with all requirements imposed upon them by the
Commission and the OTS, and by the 1933 Act, the 1933 Act Regulations, the 1934
Act and the 1934 Act Regulations, 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.
(j) If, at any time during the period when the Prospectus is required
to be delivered, any event relating to or affecting the Company or the
Association shall occur, as a result of which it is necessary or appropriate, in
the opinion of counsel for the Company and the Association or in the 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, the Company and the Association shall, at their own expense, prepare
and file with the Commission and the OTS and furnish to the 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
satisfactory to the Agent and its counsel after a reasonable time for review)
which shall amend or supplement the Registration Statement or Prospectus, so
that as amended or supplemented the Registration Statement and the Prospectus
shall not contain an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in light of the
circumstances existing at the time the Prospectus is delivered to a purchaser,
not misleading.
(k) The Company and the Association shall conduct the Conversion,
including the offer and sale of the Shares, in all material respects in
accordance with the Plan and 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 Association by the Commission, the OTS or any other regulatory authority
and in the manner described in the Prospectus.
(l) The Company and the Association shall each timely furnish to the
Agent such information with respect to them as the Agent may from time to time
reasonably request.
(m) The Company shall take all necessary action required to register
the Shares for offering and sale by the Company or to exempt such Shares from
registration and to exempt the Company as a broker-dealer and its officers,
directors and employees as broker-dealers or agents
-13-
under the Blue Sky Laws of such jurisdictions in which the Agent and the Company
and the Association may reasonably agree upon; provided, however, that the
Company shall not be obligated to file any general consent to service of process
or to qualify to do business in any jurisdiction in which it is not so
qualified; and in each jurisdiction where any of the Shares shall have been
qualified or registered the Company shall prepare and file, at its own expense,
such statements and reports as may be required by the laws of such jurisdiction.
(n) The liquidation account for the benefit of Eligible Account Holders
and Supplemental Eligible Account Holders shall be duly established and
maintained by the Association in accordance with the Conversion Regulations.
(o) The Company and the Association shall not sell or issue, contract
to sell or otherwise dispose of, for a period of 180 days after the Closing
Date, without the prior written consent of the Agent, any shares of Common Stock
other than in connection with any plan or arrangement described in the
Prospectus.
(p) The Common Stock shall be the subject of an effective registration
statement under Section 12(g) of the 1934 Act as of the Closing Date and the
Company shall maintain the effectiveness of such registration for not less than
three years.
(q) During the period during which the Common Stock is registered under
the 1934 Act or for three years from the Closing Date, whichever period is
greater, the Company shall furnish to its stockholders as soon as practicable
after the end of each fiscal year an annual report in accordance with Rule
14a-3(b) of the 1934 Act Regulations.
(r) During the period of three years from the Closing Date, the Company
shall 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-KSB, 10-QSB 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
Association as the Agent may reasonably request; and (iii) from time to time,
such other non-confidential information concerning the Company or the
Association as the Agent may reasonably request.
(s) The Company and the Association 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."
(t) The Company will not distribute any prospectus (as defined in
Section 2(10) of the 1933 Act) other than the Prospectus and the Sales
Information (as defined in Section 8 hereof) in connection with the offer and
sale of the Shares without first notifying the Agent.
(u) The Company shall use its best efforts to (i) encourage and assist
three market makers to establish and maintain a market for the Shares and (ii)
list the Shares on a national securities
-14-
exchange or on The Nasdaq Stock Market effective on or prior to the Closing
Date.
(v) The Association 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 Association's obligation to refund
payments received from persons subscribing for or ordering Shares in the
Offering in accordance with the Plan and as describe in the Prospectus or until
refunds of such funds have been made to the persons entitled thereto or
withdrawal authorizations cancelled in accordance with the Plan and as described
in the Prospectus. The Association 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 Association 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.
(w) The Company will register as a savings and loan holding company
under the HOLA within 90 days of the Closing Date.
(x) The Company and the Association 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."
(y) The Association will not amend the Plan of Conversion without
notifying the Agent prior thereto.
(z) The Company and the Association will assist Xxxx, if necessary, in
connection with the allocation of the Shares in the event of an oversubscription
and will provide Xxxx with any information necessary in allocating the Shares in
such event.
(aa) The Company and the Association shall comply with the provisions
of Rule 158 of the 1933 Act Regulations.
(bb) The Company shall report the use of proceeds of the Offering
pursuant to Rule 463 of the 1933 Act Regulations.
(cc) The Company and the Association shall use all reasonable efforts
to comply with, or cause to be complied with, the conditions precedent to the
several obligations of the Agent specified in Section 7 hereof.
(dd) Until the Closing Date, the Company and the Association shall
conduct their businesses in material compliance with all applicable federal and
state laws, rules, regulations, decisions, directives and orders, including all
decisions, directives and orders of the Commission, the OTS and the FDIC.
(ee) Upon completion of the sale by the Company of the Shares
contemplated by the Prospectus, (i) the Association shall have been converted
pursuant to the Plan to a federally chartered stock savings bank, (ii) all of
the authorized and outstanding capital stock of the Association shall be owned
by the Company, (iii) the Company shall have no direct subsidiaries other than
the
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Association, and (iv) the Conversion shall have been effected in accordance with
all applicable statutes, regulations decisions and orders; and all terms,
conditions, requirements and provisions with respect to the Conversion (except
those that are conditions subsequent) imposed by the Commission, the OTS or any
other governmental agency, if any, shall have been complied with by the Company
and the Association in all material respects or appropriate waivers shall have
been obtained and all notice and waiting periods shall have been satisfied,
waived or elapsed.
Section 6. Covenants of the Agent. The Agent hereby covenants with the
Company and the Association as follows:
(a) During the Offering, the Agent shall comply, in all material
respects, with all requirements imposed upon it by the OTS and, to the extent
applicable, by the 1933 Act, the 1933 Act Regulations, the 1934 Act and the 1934
Act Regulations.
(b) The Agent shall distribute the Prospectus in connection with the
sales of the Common Stock in accordance with Conversion Regulations, the 1933
Act and the 1933 Act Regulations.
Section 7. Conditions to the Agent's Obligations. The Agent's
obligations hereunder 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 Association 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 Association 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 Association shall have
conducted the Conversion in all material respects 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, the FDIC, the
Commission and any state securities agency.
(b) The Registration Statement shall have been declared effective by
the Commission, the Conversion Application approved by the OTS, and the Holding
Company 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 and the Association's knowledge, threatened by
the Commission, the OTS or any other federal or 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 for their benefit, of Xxxxxx,
Xxxxxxxx & Xxxx, L.L.P., counsel for the Company and the
Association, in form and substance to the effect that:
-16-
(i) The Company has been duly incorporated and is validly
existing and in good standing under the laws of the
State of Delaware and 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 Company is qualified to do
business as a foreign corporation in Ohio.
(ii) The Association is a validly existing federal savings
bank in the mutual form of organization under the laws
of the United States of America and, upon the
consummation of the Conversion, shall be a validly
existing federal savings bank in the capital stock form
of organization under the laws of the United States, in
both instances with full corporate power and authority
to conduct its business and own its property as
described in the Registration Statement and Prospectus;
and upon consummation of the Conversion, all of the
issued and outstanding capital stock of the Association
shall be duly authorized and, upon payment therefor,
shall be validly issued, fully paid and non-assessable,
and all such capital stock shall be owned of record
and, to such counsel's knowledge, shall be owned
beneficially by the Company free and clear of any
liens, encumbrances or claims.
(iii) The Association is a member of the FHLB-Cincinnati;
the deposit accounts of the Association are insured by
the FDIC under the SAIF up to the maximum amount
allowed under law; and, to such counsel's knowledge, no
proceedings for the termination or revocation of such
membership or insurance are pending or threatened.
(iv) Upon consummation of the Conversion, the authorized,
issued and outstanding capital stock of the Company
shall 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; upon consummation of the Conversion, the
Shares subscribed for pursuant to the Offering have
been duly and validly authorized for issuanc 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 the Prospectus, shall be duly
and validly issued, fully paid and non-assessable;
except for subscription rights granted pursuant to the
Plan, the issuance of the Shares is not subject to
preemptive rights; the terms and provisions of the
Shares conform to the description thereof contained in
the Prospectus; and the form of certificate used to
evidence the Common Stock complies with applicable law.
To such counsel's 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.
-17-
(v) The Conversion Application and the Holding Company
Application have been approved by the OTS and the
Prospectus and the proxy statement of the Association
has been authorized for use by the OTS; and no action
is pending or, to such counsel's knowledge, threatened
to revoke any such authorizations or approvals.
(vi) The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby
have been duly and validly authorized by all necessary
action on the part of the Company and the Association;
and this Agreement is a valid and binding obligation of
the Company and the Association, enforceable against
the Company and the Association in accordance with its
terms, except as the enforceability thereof may be
limited (a) by bankruptcy, insolvency, moratorium,
reorganization, 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 savings
institutions and their holding companies, (b) by
general equitable principles, regardless of whether
such enforceability is considered in a proceeding in
equity or at law, (c) by laws relating to the safety
and soundness of insured depository institutions or (d)
by applicable law or public policy with respect to the
indemnification and contribution provisions contained
herein, including without limitation the provisions of
Sections 23A and 23B of the Federal Reserve Act.
(vii) The execution and delivery of this Agreement and the
incurrence and performance of the obligations set forth
herein by the Company and the Association do not (a)
result in any violation of any applicable law or
regulation (except that no opinion need be rendered
with respect to the Blue Sky Laws of various
jurisdictions), (b) conflict with or violate the
certificate of incorporation and bylaws of the Company
or the charter and bylaws of the Association in mutual
or stock form, or (c) to such counsel's knowledge,
constitute a breach of, or default under (or an event
which, with notice or lapse of time or both, would
constitute a default under), or result in the creation
or imposition of any lien, charge or encumbrance upon
any property or assets of the Association or the
Company pursuant to any contract, indenture, mortgage,
loan agreement, note, lease or other instrument to
which the Company or the Association 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 Association is
subject that, individually or in the aggregate would
have a material adverse effect on the financial
condition, results of operations or business of the
Company and the Association.
(viii) The Plan has been duly adopted by the vote of the
directors of the Company and the Association as
required by the Conversion
-18-
Regulations and, based upon the certificate of
the inspectors of election, approved by the eligible
voting members of the Association in accordance with
the Conversion Regulations and the Association's
charter and bylaws.
(ix) Subject to the satisfaction of the conditions to the
OTS approval of the Conversion, no further approval,
registration, authorization, consent or other order of
or notice to any governmental 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 Blue Sky Laws of various
jurisdictions or the rules and regulations of the NASD
(as to which no opinion need be rendered).
(x) The Registration Statement has been declared effective
under the 1933 Act and no stop order suspending the
effectiveness has been issued or proceedings therefor
initiated or, to such counsel's knowledge, threatened
by the Commission.
(xi) At the time the Conversion Application, including the
Prospectus contained therein, was approved by the OTS,
the Conversion Application, including the Prospectus
contained therein (other than the financial statements,
the notes thereto, financial tables, and other
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 Conversion Regulations.
(xii) At the time that the Registration Statement became
effective, the Registration Statement, including the
Prospectus (other than the financial statements, the
notes thereto, financial tables, 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.
(xiii) To such counsel's knowledge, there are no legal or
governmental proceedings pending or threatened against
the Company or the Association or principals of the
Company or the Association that are required to be
disclosed in the Registration Statement and the
Prospectus other than those disclosed therein
(xiv) To such counsel's knowledge, there are no 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 to the Registration Statement or
the Conversion Application other than those described
or referred to therein or filed as exhibits thereto;
the descriptions in the Conversion Application, the
-19-
Registration Statement and the Prospectus of the
contracts, indentures, mortgages, loan agreements,
notes, leases or other instruments filed as exhibits
thereto are accurate in all material respects and
fairly present the information required to be shown.
(xv) The Plan complies with the HOLA and the Conversion
Regulations; no order has been issued by the OTS, the
Commission 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 knowledge, threatened; and, to such counsel's
knowledge, no person has sought to obtain regulatory or
judicial review of the final action of the OTS
approving the Plan, the Conversion Application, th
Holding Company Application or the Prospectus.
(xvi) To such counsel's knowledge, the Company and the
Association have obtained all licenses, permits and
other governmental authorizations currently required
for the conduct of their respective businesses as
described in the Registration Statement and Prospectus,
except for licenses, approvals or authorizations the
failure of which to have would not result in a material
adverse change in the financial condition, results of
operation or the business of the Company an the
Association, taken as a whole, and, to such counsel's
knowledge, all such licenses, permits and other
governmental authorizations are in full force and
effect, and, to such counsel's knowledge, the Company
and the Association are in all materials respects
complying therewith.
(xvii) To such counsel's knowledge, neither the Company nor
the Association is in violation of its certificate of
incorporation and bylaws, or charter and bylaws,
respectively, nor, to such counsel's knowledge, in
default (nor has any event occurred which, with notice
or lapse of time or both, would constitute a default)
in the performance or observance of any obligation,
agreement, covenant or condition contained in any
material contract, indenture, mortgage, loan agreement,
note, lease or other instrument to which the Company or
the Association is a party or by which the Company, the
Association or any of their property may be bound in
any respect that would have a material adverse effect
upon the financial condition, results of operations or
business of the Company and the Association, taken as a
whole.
(xviii) The Company's certificate of incorporation and
bylaws comply with the laws of the State of Delaware.
The Bank's charter and bylaws, to be effective upon
completion of the Conversion, comply with the laws of
the United States of America.
(xix) To such counsel's knowledge, neither the Company nor
the Association is in violation of any directive from
the OTS or the FDIC
-20-
to make any material change in the method of conducting
its business.
(xx) The information in the Prospectus under the captions
"Regulation," "The Conversion," "Restrictions on
Acquisitions of Stock and Related Takeover Defensive
Provisions," "Taxation," and "Description of Capital
Stock," 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 accurate and complete in all
material respects.
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 Association and
certificates of public officials. Such opinion may specify that it shall be
limited to matters of federal, Delaware and Ohio law. All references to "to such
counsel's knowledge" in such opinion shall refer to the actual and conscious
awareness of facts or other information of the individual Silver, Xxxxxxxx &
Xxxx, L.L.P., attorneys who have been actively involved in the transactions
contemplated by this Agreement or the preparation of such opinion. 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 Association, or their counsel, shall have received a copy of such
proceedings, order, stop order or action and such counsel need not regard an
litigation or governmental proceeding to be "threatened" unless the potential
litigant or governmental authority has manifested to the management of the
Company or the Association or to such counsel, a present intention to initiate
such litigation or proceeding. 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 Association.
In addition, such counsel shall provide a letter stating that during
the preparation of the Registration Statement, Conversion Application and the
Prospectus, such counsel participated in conferences with certain officers and
other representatives of the Association and the Company, representatives of the
Agent, counsel to the Agent, representatives of the independent public
accountants for the Association and the Company at which the contents of the
Registration Statement, the Conversio Application and the Prospectus and related
matters were discussed and, although they are not passing upon and do not assume
the responsibility for the accuracy, completeness or fairness of the statements
contained in the Registration Statement, the Conversion Application and
Prospectus, on the basis of the foregoing (relying as to factual matters on
certificates of officers and other factual representations by the Association
and the Company), nothing has come to such counsel's attention that caused them
to believe that the Registration Statement at the time it was declared effective
by the SEC or the Prospectus as of its date and as of the Closing Date,
contained or contains any untrue statement of a material fact or omitted or
omits to state any 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 (it being understood that such counsel shall express
no comment or opinion with respect to the financial statements, schedules and
other financial information and statistical and stock valuation data included,
or statistical methodology employed, in the Registration Statement, Conversion
Application and Prospectus).
-21-
(2) The favorable opinion, dated as of the Closing Date, of
Xxxxx, Xxxxx, Xxxxxxx and Xxxxx LLP, counsel to the Agent,
with respect to such matters as the Agent may reasonably
require. Such opinion may rely, as to matters of fact, upon
certificates of officers and directors of the Company and
the Association delivered pursuant hereto or as such counsel
shall reasonably request.
(d) At the Closing Date, the Agent shall receive a certificate of the
Chief Executive Officer and the Chief Financial Officer of the Company and a
certificate of the Chief Executive Officer and the Chief Financial Officer of
the Association, both dated as of the Closing Date, that state that: (i) they
have reviewed the Prospectus and, 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 respective dates as of which information is given in
the Registration Statement and the Prospectus and as of the Closing Date, no
material adverse change in the financial condition or in the earnings, capital,
properties or business of the Company and the Association, considered as one
enterprise, has occurred and no other event has occurred, which should have been
set forth in an amendment or supplement to the Prospectus which has not been so
set forth, and the conditions set forth in this Section 7 have been satisfied;
(iii) the representations and warranties in Section 3 are true and correct with
the same force and effect as though expressly made at and as of the Closing
Date; (iv) the Company and the Association have complied 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 Closing Date; (v) no stop order
suspending the effectiveness of the Registration Statement is pending or, to the
knowledge of the Company or the Association, threatened by the Commission or any
state authority; (vi) no order suspending the Offering, the Conversion, or the
effectiveness of the Prospectus has been issued and no proceedings for that
purpose are pending or, to the knowledge of the Company or the Association
threatened by the OTS, the Commission, or any other authority; and (vii) to the
knowledge of the Company or the Association, no person has sought to obtain
review of the final action of the OTS approving the Plan.
(e) Prior to and at the Closing Date: (i) in the reasonable opinion of
the Agent, there shall have been no material adverse change in the financial
condition, or in the earnings or business of the Company and the Association,
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; (ii) the Company or the Association shall not have
received any directive from the OTS o the FDIC to make any material change in
the method of conducting their business with which it has not complied (which
directive, 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 Association, considered as one enterprise; (iii)
the Company and the Association 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; (iv) no action, suit or proceedings,
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 and the Association, threatened against the Company or the Association
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
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Company and the Association, considered as one enterprise; and (v) where
required, the Shares have been qualified or registered for offering and sale
under the Blue Sky Laws of the jurisdictions in which the Shares have been
offered for sale.
(f) Concurrently with the execution of this Agreement, the Agent shall
receive a letter from Xxxxxx, Xxxxxxx & Xxxxxxxx dated the date hereof and
addressed to the Agent: (i) confirming that Xxxxxx, Xxxxxxx & Xxxxxxxx are
independent public accountants within the meaning of the 1933 Act, the 1933 Act
Regulations, 12 C.F.R. Section 571.2(c)(3) and the Code of Professional Ethics
of the American Institute of Certified Public Accountants, and stating in effect
that in their opinion the financial statements of the Association as of December
31, 1997 and 1996, and for the years ended December 31, 1997, 1996 and 1995,
included in the Registration Statement and the Prospectus and covered by their
opinion included therein, comply as to form in all material respects with the
applicable accounting requirements of the 1933 Act, the 1933 Act Regulations,
the Conversion Regulations, and GAAP applied consistently; (ii) stating in
effect that, on the basis of certain agreed upon procedures (but not an audit
examination in accordance with generally accepted auditing standards) consisting
of a reading of the latest available unaudited interim financial statements of
the Association prepared by the Association, a reading of the minutes of the
meetings of the Boards of Directors of the Association and the Company and the
members of the Association, and consultations with officers of the Association
responsible for financial and accounting matters, nothing came to its attention
which caused it to believe that: (A the unaudited financial statements of the
Association included in the Prospectus are not in conformity with GAAP applied
on a basis substantially consistent with that of the audited financial
statements included in the Prospectus; and (B) during the period from that date
of the latest audited financial statements included in the Prospectus to a
specified date not more than three business days prior to the date hereof, there
was any increase in borrowings or in non-performing assets by the Company or the
Association; and (C) except as otherwise discussed in the Prospectus, there was
any decrease in retained earnings of the Association at the date of such letter
as compared with amounts shown in the latest audited statement of condition
included in the Prospectus or there was any decrease in net income or net
interest income of the Association for the number of full months commencing
immediately after the period covered by the latest audited income statement
included in the Prospectus and ended on the latest month end prior to the date
of the Prospectus or in such letter as compared to the corresponding period in
the preceding year (included in the Recent Developments Section of the
Prospectus); and (iii) stating that, in addition to the audit referred to in its
opinion included in the Prospectus and the performance of the procedures
referred to in clause (ii) of this subsection (f), it has compared with the
general accounting records of the Company and/or the Association, as applicable,
which are subject to the internal controls of the Company's and/or the
Association's, as applicable, accounting system and other data prepared by the
Company and/or the Association, as applicable, 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
found such amounts and percentages to be in agreement therewith.
(g) At the Closing Date, the Agent shall receive a letter from Xxxxxx,
Xxxxxxx & Xxxxxxxx dated the Closing Date, addressed to the Agent, confirming
the statements made by them in the letter delivered by them pursuant to
subsection (f) of this Section 10, the specified date referred to in clause (ii)
of subsection (f) thereof to be a date specified in such letter, which shall not
be more than three business days prior to the Closing Date.
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(h) At the Closing Date, the Agent shall receive a letter from Xxxxxx &
Company, dated the Closing Date and addressed to the Agent, (i) confirming that
said firm is independent of the Company and the Association and is experienced
and expert in the area of corporate appraisals within the meaning of the
Conversion Regulations, (ii) stating in effect that the Appraisal prepared by
such firm complies in all material respects with the applicable requirements of
the Conversion Regulations, and (iii) further stating that its opinion of the
aggregate pro forma market value of the Company and the Association expressed in
the appraisal as most recently updated, remains in effect.
(i) The Company and the Association shall not have sustained since the
date of the latest audited financial statements included in the Prospectus any
material loss or interference with their businesses 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.
(j) At or prior to the Closing Date, the Agent shall receive: (i) a
copy of the letters from the OTS approving the Conversion Application and the
Holding Company Application and authorizing the use of the Prospectus; (ii) a
copy of the order from the Commission declaring the Registration Statement
effective; (iii) a certificate from the OTS evidencing the existence of the
Association; (iv) a certificate of good standing from the State of Ohio
evidencing the good standing of the Company; (v) certificate from the FDIC
evidencing the Association's insurance of accounts; (vi) a certificate of the
FHLB-Cincinnati evidencing the Association's membership therein; and (vii) any
other documents that the Agent shall reasonably request.
(k) As soon as available after the Closing Date, the Agent shall
receive a copy of the Association's federal stock charter as executed by the
OTS.
(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 Nasdaq Stock Market or by order of
the Commission or any other governmental authority; (ii) a general moratorium on
the operations of commercial banks, Ohio or federal savings and loan
associations or a general moratorium on the withdrawal of deposits from
commercial banks, Ohio or federal savings and loan associations 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 in the effect of any of items (i) through (iii) above
in the Agent's reasonable judgment, 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 Prospectus.
Section 8. Indemnification.
(a) The Company and the Association jointly and severally agree to
indemnify and hold harmless the Agent, its officers, directors, agents, servants
and employees 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
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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 expenses (including reasonable fees and disbursements of counsel)
incurred by the Agent or any of them in connection with investigating, preparing
to defend or defending any actions, proceedings or claims (whether commenced or
threatened) to the extent such losses, claims, damages, liabilities or actions:
(i) arise out o or are related to the Conversion or any action taken by the
Agent where acting as agent of the Company and the Association, including
without limitation the denial or reduction of a subscription or order to
purchase Common Stock based upon the deposit records of the Association or
otherwise; (ii) arise out of or are based upon any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement (or
any amendment or supplement thereto), Prospectus (or any amendment or supplement
thereto), the Conversion Application (or any amendment or supplement thereto),
the Holding Company Application (or any amendment or supplement thereto), or any
blue sky application or other instrument or document executed by the Company or
the Association or based upon written information supplied by the Company or the
Association 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 agents, under the securities laws thereof
(collectively, the "Blue Sky Application"), or any application or other
document, advertisement, oral statement or communication ("Sales Information")
prepared, made or executed by or on behalf of the Company or the Association
based upon written or oral information furnished by or on behalf of the Company
or the Association, 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; (iii) arise out of or based upon the omission or alleged omission
to state in any of the foregoing documents or information, a material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading; or (iv)
arise from any theory of liability whatsoever relating to or arising from or
based upon the Registration Statement (or any amendment or supplement thereto),
Prospectus (or any amendment or supplement thereto), the Conversion Application
(or any amendment or supplement thereto), the Holding Company 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 statements in, or material omission or alleged material omission from,
the Registration Statement (or any amendment or supplement thereto), Prospectus
(or any amendment or supplement thereto), the Conversion Application (or any
amendment or supplement thereto), the Holding Company Application (or any
amendment or supplement thereto), any Blue Sky Application or Sales Information
made in reliance upon and in conformity with information furnished in writing to
the Company or the Association by the Agent regarding the Agent; and provided
further, however, that the Company and the Association shall not be liable under
the foregoing indemnification provision to the extent that any loss, claim,
damage, liability or action is found in a final judgment by a court of competent
jurisdiction to have resulted from the Agent's bad faith or gross negligence.
(b) The Agent agrees to indemnify and hold harmless the Company and the
Association, their directors and officers and each person, if any, who controls
the Company or the Association
-25-
within the meaning of Section 15 of the 1933 Act or Section 20(a) of the I934
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 Association, 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 to defend or defending any actions, proceedings or claims (whether
commenced or threatened) to the extent such losses, claims, damages, liabilities
or actions arise out of or are based upon any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement (or any
amendment or supplement thereto), the Conversion Application (or any amendment
or supplement thereto) or the Prospectus (or any amendment or supplement
thereto), 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 Prospectus (or any
amendment or supplement thereto) or the Conversion Application (or any amendment
or supplement thereto), and Blue Sky Application or Sales Information in
reliance upon and in conformity with information furnished in writing to the
Company or the Association by the Agent regarding the Agent.
(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 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 in this Section 8 and in Section 9 hereof and the
representations and warranties of the Company and the Association set forth in
this Agreement shall remain operative and in full force and effect regardless
of: (i) any investigation made by or on behalf of the Agent or their officers,
directors or controlling persons, agents or employees or by or on behalf of the
Company or the Association or any officers, directors or controlling persons,
agents or employees of the Compan or the Association; (ii) delivery of and
payment hereunder for the Shares; or (iii)
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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 Association or the Agent, as the
case may be, the Company, the Association 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 Association 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 and expenses paid to the
Agent pursuant to Section 2 of this Agreement bears to the gross proceeds
receive by the Company from the sale of the Shares in the Offering, and the
Company and the Association 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 Association, 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 Association, on the one hand, and the Agent, on the other, from
the Offering (before deducting expenses). The relative benefits received by the
Company and the Association, on the one hand, and the Agent, on the other, shall
be deemed to be in the same proportion as the gross proceeds from the Offering
received by the Company bear to the total fees and expenses received by the
Agent. 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 alleged omission to state a material fact relates to information
supplied by the Company or the Association, 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 Association 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 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 1933 Act) shall be
entitled to contribution from any person who was not found guilty of such
fraudulent misrepresentation. The obligations of the Company and the Association
under this Section 9 and under Section 8 shall be in addition to any liability
which the Company and the Association may otherwise have. For purposes of this
Section 9, each of the Agent's, the Company's or the Association's officers and
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directors and each person, if any, who controls the Agent or the Company or the
Association 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 Association. 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,
shall notify such party from whom contribution may be sought, but the omission
to so notify such party shall not relieve the party from whom contribution may
be sought from any other obligation it may have hereunder or otherwise than
under this Section 9. To the extent applicable, the Company's, the Association's
and the Agent's obligations under this Section 9 are subject to and limited by
public policy and the provisions of applicable law.
Section 10. Survival of Agreements Representations and Indemnities. The
respective indemnities of the Company, the Association and the Agent, and the
representations and warranties and other statements of the Company, the
Association 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 Association or any controlling person referred to in Section 8
hereof, and shall survive the issuance of the Shares, and any legal
representative, successor or assign of the Agent, the Company, the Association,
and any such controlling person shall be entitled to the benefit of the
respective agreements, indemnities, warranties and representations.
Section 11. Termination.
(a) The Agent may terminate its obligations under this Agreement by
giving the notice indicated below in subsection (b) at any time after this
Agreement becomes effective as follows:
(i) In the event the Company fails to sell the required minimum
number of Shares by the End Date, 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 Association 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 as set forth in Sections 2, 8, 9 and 10
hereof.
(ii) 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 canceled by the Agent by notifying the Company and the
Association of such cancellation as provided in Section 12
hereof in writing or 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, 8, 9 and 10 hereof.
(iii) In the event either the Company or the Association is in
material breach of the representations and warranties or
covenants contained in Sections 3 and
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5 and such breach has not been cured after the Agent has
provided the Company and the Association with notice of such
breach.
(b) If the Agent elects to terminate this Agreement with respect to it
as provided in this Section 11, the Company and the Association shall be
notified promptly by telephone, confirmed by letter.
(c) The Company and the Association may terminate this Agreement with
respect to the Agent in the event the Agent is in material breach of the
representations and warranties or covenants contained in Sections 4 and 6 and
such breach has not been cured after the Company and the Association have
provided the Agent with notice of such breach.
(d) 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 the
Agent shall be mailed or delivered and confirmed to Xxxxxxx Xxxx & Company, 000
Xxxxxxxxx, Xxxxxx, Xxxx 00000- 5034, Attention: Xxxxxxxx X. XxXxxxx (with a copy
to Vorys, Xxxxx, Xxxxxxx and Xxxxx LLP, Suite 2100, Atrium Two, 000 X. Xxxxxx
Xxxxxx, Xxxxxxxxxx, Xxxx 00000, Attention: Xxxxxxx X. Xxxxxx), if sent to the
Company and the Association, shall be mailed or delivered and confirmed to the
Company and the Association at 00 Xxxxx Xxxx Xxxxxx, Xxxxx, Xxxx 00000-0000,
Attention: Xxxxxxx X. Xxxxxxxx (with a copy to Silver, Xxxxxxxx & Xxxx, L.L.P.,
7th Floor, East Tower, 0000 Xxx Xxxx Xxxxxx, X.X., Xxxxxxxxxx, X.X. 00000,
Attention: Xxxxx X. Xxxxxxxxx).
Section 13. Parties. The Company and the Association shall be entitled
to act and rely on any request, notice, consent, waiver or agreement 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 Association, when
the same shall have been given by the undersigned or any other officer of the
Company or the Association. This Agreement shall inure solely to the benefit of,
and shall be binding upon, the Agent, the Company, the Association, and their
respective successors, legal representatives and assigns, and no other person
shall have or be construed to have any legal or equitable right, remedy or claim
under or in respect of or by virtue of this Agreement or any provision herein
contained.
Section 14. Entire Agreement. It is understood and agreed that this
Agreement is the exclusive agreement among the parties hereto, and supersedes
any prior agreement among the parties (except for specific references herein to
the Letter Agreement) and may not be varied except in writing signed by all the
parties.
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 shall not be affected thereby, and each term, provision or covenant
herein shall be valid and enforceable to the full extent permitted by law.
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Section 16. Construction. This Agreement shall be construed in
accordance with the laws of the State of ______, except to the extent that
federal law shall apply.
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.
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If the foregoing correctly sets forth the arrangement among the Company,
the Association, and the Agent, 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.
Very truly yours,
HOME FEDERAL SAVINGS AND LOAN
ASSOCIATION OF NILES
By:____________________________
Xxxxxxx X. Xxxxxxxx
President
FIRST NILES FINANCIAL, INC.
By:____________________________
Xxxxxxx X. Xxxxxxxx
President
Accepted as of the date first above written
XXXXX, XXXXXXXX
& XXXXX, INC.
By: _________________________
Xxxxxxxx X. XxXxxxx
Executive Vice President
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