EXHIBIT 1.2
XXXXXXX XXXXXX FINANCIAL CORPORATION
_______ Shares of Common Stock
($0.01 Par Value)
Subscription Price $10.00 Per Share
AGENCY AGREEMENT
_________, 1997
Xxxxxxx Xxxx & Company, a division of
Xxxxx, Xxxxxxxx & Xxxxx, Inc.
000 Xxxxxxxxx Xxxxx
Xxxxxx, Xxxx 00000-0000
Ladies and Gentlemen:
Xxxxxxx Xxxxxx Financial Corporation, a Delaware corporation ("Company"),
and Peoples Federal Savings and Loan Association of Sidney, Sidney, Ohio
("Peoples Federal" or the "Association"), a federal mutual savings and loan
association (references to the "Association" include the Association in the
mutual or stock form, as indicated by the context), with its deposit accounts
insured by the Savings Association Insurance Fund ("SAIF") administered by the
Federal Deposit Insurance Corporation ("FDIC"), hereby confirm their agreement
with Xxxxxxx Xxxx & Company, a division of Xxxxx, Xxxxxxxx & Xxxxx, Inc.,
("Xxxx" or the "Agent") as follows:
Section 1. The Offering. The Association, in accordance with its plan of
conversion ("Plan"), adopted by its Board of Directors, intends to convert from
a federal mutual savings and loan association to a federal stock savings and
loan association and issue all of its outstanding capital stock to the Company.
In addition, pursuant to the Plan, the Company intends to offer and sell up to
1,437,500 shares of its common stock, $0.01 par value ("Shares" or "Common
Stock"), subject to possible increase to up to 1,653,125 Shares, in a
subscription offering ("Subscription Offering") to (i) depositors in the
Association on October 31, 1995 ("Eligible Account Holders"), (ii) the
Association's Employee Stock Ownership Plan ("ESOP"), (iii) depositors in the
Association on December 31, 1996 ("Supplemental Eligible Account Holders"), (iv)
members of the Association other than Eligible Account Holders and Supplemental
Eligible Account Holders as of _________, 1997 ("Other Members"), and (v)
employees, officers and directors of the Association. Subject to the prior
subscription rights of the above-listed parties, the Company is offering for
sale in a community offering ("Community Offering" and, when referred to
together with the Subscription Offering, the "Subscription and Community
Offering"), conducted concurrently with the Subscription Offering, the Shares
not so subscribed for or ordered in the Subscription Offering to certain members
of the general public to whom a copy of the Prospectus (as hereinafter defined)
is delivered ("Other Subscribers"), with a preference given to natural persons
who reside in Shelby County, Ohio ("Local
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Community") (all such offerees being referred to in the aggregate as "Eligible
Offerees"). It is anticipated that Shares not subscribed for in the Subscription
and Community Offering will be offered to members of the general public on a
best efforts basis through a selected dealers arrangement ("Syndicated Community
Offering") (the Subscription Offering, Community Offering and Syndicated
Community Offering are collectively referred to as the "Offering"). It is
acknowledged that the purchase of Shares in the Offering is subject to the
maximum and minimum purchase limitations as described in the Plan and that the
Company and the Association may reject, in whole or in part, any orders received
in the Community Offering or Syndicated Community Offering. Collectively, these
transactions are referred to herein as the "Conversion."
The Company has filed with the Securities and Exchange Commission
("Commission") a Registration Statement on Form S-1 (File No. ________)
("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 thereto, if any, and such amended 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 became
effective is hereinafter called the "Prospectus," except that if any prospectus
is filed by the Company pursuant to Rule 424(b) or (c) of the rules and
regulations of the Commission under the 1933 Act ("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 ("Conversion Application"), including the
Prospectus, and has filed such amendments thereto, if any, as may have been
required by the OTS pursuant to the Home Owners' Loan Act, as amended ("HOLA"),
and 12 C.F.R. Part 563b ("Conversion Regulations"). The Conversion Application
has been approved by the OTS and the related Prospectus and proxy statement has
been authorized for use by the OTS. In addition, the Company has filed with the
OTS an application on Form H-(e) 1-S ("Holding Company Application"), and has
filed such amendments thereto as may have been required by the OTS, to become a
registered savings and loan holding company under the HOLA.
Section 2. Retention of the Agent; Compensation; 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 financial advisor and
marketing agent (i) 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 Company's sale of the Shares in the Offering and (ii) to participate in the
Offering in the areas of market making, research coverage and syndicate
formation (if necessary).
On the basis of the representations, warranties, and agreements herein
contained, but subject to the terms and conditions herein set forth, the Agent
accepts such appointment and agrees to consult with and advise the Company and
the Association as to the matters set forth in the letter agreement dated
November 15, 1996 ("Letter Agreement"), between the Association and the Agent.
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The Agent shall not be required to purchase any Shares and shall not be
obligated to take any action which is inconsistent with all applicable laws,
regulations, decisions or orders. In the event of a Syndicated Community
Offering, the Agent shall assemble and manage a selling group of 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.
The obligations of the Agent pursuant to this Agreement shall terminate
upon the completion or termination or abandonment of the Plan by the Association
or upon termination of the Offering, but in no event later than 45 days after
the completion of the Subscription and Community Offering ("End Date"). All fees
or expenses due to the Agent but unpaid shall be payable to the Agent in next
day funds at the earlier of the Closing Date (as hereinafter defined) or the End
Date. In the event the Offering is extended beyond the End Date, the Company,
the 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 1,062,500 Shares
during the Offering (including any permitted extensions thereof), this Agreement
shall terminate and the Company shall refund to any persons who have subscribed
for any of the Shares the full amount which it may have received from them, plus
accrued interest as set forth in the Prospectus and none of the parties to this
Agreement shall have any obligation to the other parties hereunder, except as
set forth in this Section 2 and in Sections 8, 10 and 11 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 subparagraphs (a) and (d) below, including any accrued legal fees
expended by the Agent.
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 Conversion appraisal, are satisfied, the Company agrees to issue,
or have issued, the Shares sold in the Offering and to release for delivery
certificates for such Shares on the Closing Date (as hereinafter defined)
against payment to the Company by any means authorized by the Plan; provided,
however, that no funds shall be released to the Company until the conditions
specified in Section 9 hereof shall have been complied with to the reasonable
satisfaction of the Agent and its counsel. The release of Shares against payment
therefor shall be made at a time, date and place 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:
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(a) A Management Fee to the Agent of $25,000, payable in four monthly
installments of $6,250 beginning with the signing of the Letter
Agreement, all of which has been paid as of the date hereof, which
shall be payable as compensation for the consulting services
enumerated in the Letter Agreement, including, among other services,
the training and education of the Association's employees on the
Conversion process, assistance in structuring the Conversion and in
making determinations with respect to stock benefit plans and
programs, providing advice on the selection of a printer, transfer
agent, or appraiser, and establishing and managing a Conversion
Center. Such fees shall be deemed to be earned when due.
(b) A Success Fee to the Agent of 1.5% of the aggregate purchase price of
the Shares sold in the Subscription and Community Offering, excluding
those Shares 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 IRAs) or
similar plan created by the Association for some or all of its
directors or employees.
(c) If any shares of the Common Stock remain available after the
Subscription Offering and the Community Offering, at the request of
the Association, the Agent will seek to form a syndicate of registered
broker-dealers to assist in the sale of such Common Stock on a best
efforts basis, subject to the terms and conditions set forth in the
selected dealer's agreement. The Agent will endeavor to distribute the
Common Stock among dealers in a fashion which best meets the
distribution objectives of the Association and the Plan of Conversion.
The Agent will be paid a fee not to exceed 5.5% of the aggregate
Purchase Price of the shares of Common Stock sold by the
broker-dealers. The Agent will pass onto selected broker-dealers who
assist in the Syndicated Community Offering 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. Fees with respect to purchases effected with the
assistance of a broker-dealer other than the Agent shall be
transmitted by the Agent to such broker-dealer. The decision to
utilize selected broker-dealers will be made by the Association upon
consultation with the Agent. In the event, with respect to any stock
purchases, fees are paid pursuant to this subparagraph 2(c), such fees
shall be in lieu of, and not in addition to, payment pursuant to
subparagraph 2(b) above.
(d) The Association and the Company hereby agree to reimburse the Agent,
from time to time upon the Agent's request, for its reasonable
out-of-pocket expenses, which the Agent shall document, including
without limitation, communication and other incidental expenses.
Further, the Company and the Association shall reimburse the Agent for
the reasonable legal fees and expenses of its counsel. The Company and
the Association also shall bear the expenses of the Offering
customarily borne by issuers including, without limitation, OTS, SEC,
"Blue Sky," and NASD filing and
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registration fees; "Blue Sky" legal fees and disbursements; the fees
of the Association's accountants, conversion agents, attorneys,
appraiser, transfer agent and registrar; and printing, mailing and
marketing expenses associated with the Conversion. Notwithstanding
anything to the contrary in the foregoing, the Association and the
Company shall not be liable to reimburse the Agent for any travel and
accommodation expenses incurred by employees of the Agent.
Section 3. Prospectus; Offering. The Shares are to be initially offered in
the Offering at the Subscription Price as defined and set forth on the cover
page of the Prospectus.
Section 4. 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 was declared effective by the Commission on
____________, 1997. At the time the Registration Statement, including the
Prospectus contained therein, became effective, the Registration Statement
complied in all material respects with the requirements of the 1933 Act and the
1933 Act Regulations, and the Registration Statement, including the Prospectus
contained therein, and any information regarding the Company or the Association
contained in Sales Information (as such term is defined in Section 10 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. At the time any Rule 424(b) or (c) Prospectus was filed with the
Commission and at the Closing Date, 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 10 hereof) authorized by the
Company or the Association for use in connection with the Offering will not
contain an untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in light of the circumstances
under which they were made, not misleading. Notwithstanding the foregoing two
sentences, the representations and warranties in this Section 4(a) shall not
apply to statements or omissions made in reliance upon and in conformity with
written information furnished to the Company or the Association by the Agent
regarding the Agent expressly for use in the Prospectus under the caption "The
Conversion--Marketing and Underwriting Arrangements" or statements in or
omissions from any Sales Information or information regarding the Agent filed
pursuant to state securities or blue sky laws or regulations (collectively,
"Blue Sky Laws").
(b) The Conversion Application was approved by the OTS on ___________, 1997
and the related Prospectus and the proxy statement of the Association relating
to the special meeting of members at which the Plan will 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, by the OTS and at all times subsequent thereto until
the Closing Date, the Conversion Application, including the Prospectus, will
comply in all material respects with the Conversion Regulations. The Conversion
Application, including the Prospectus,
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does 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 4(b) shall not apply to statements or omissions made in reliance upon
and in conformity with written information furnished to the Company or the
Association by the Agent regarding the Agent expressly for use in the Prospectus
under the caption "The Conversion--Marketing and Underwriting Arrangements" or
statements in or omissions from any Sales Information or information regarding
the Agent filed pursuant to the Blue Sky Laws.
(c) The Company filed the Holding Company Application with the OTS pursuant
to the HOLA, which was approved on __________, 1997.
(d) No order has been issued by the OTS 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, to the best knowledge of the Company
and the Association, pending or threatened.
(e) The Plan has been adopted by the Boards of Directors of the Company and
the Association as required by the Conversion Regulations.
(f) To the best knowledge of the Company, no person has sought to obtain
review of the final action of the OTS in approving the Plan or in approving the
Conversion or the Holding Company Application pursuant to the HOLA, or the
Conversion Regulations, or state securities commissions under the Blue Sky Laws
or any other statute or regulation.
(g) The Association is organized and is validly existing as a federal
mutual savings and loan association in good standing under the laws of the
United States and, upon the completion of the Conversion, will become a duly
organized and validly existing federal stock savings and loan association, in
both instances duly authorized to conduct its business and own its property as
described in the Registration Statement and the Prospectus; the Association has
obtained all licenses, permits and other governmental authorizations currently
required for the conduct of its business, except those that individually or in
the aggregate would not materially adversely affect the financial condition,
earnings, capital, assets, properties or business 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 condition, financial or otherwise, or the
earnings, capital, assets, properties or business of the Association. The
Association does not own any equity securities or any equity interest in any
business enterprise except as described in the Prospectus.
(h) 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,
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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 each jurisdiction in which the conduct of
its business requires such qualification, except where the failure to so qualify
would not have a material adverse effect on the condition, financial or
otherwise, 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 those
that individually or in the aggregate would not materially adversely affect the
financial condition, earnings, capital, assets, properties or business 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 Company is
complying in all material respects therewith.
(i) 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 limits; and no proceedings for the
termination or revocation of such membership or insurance are to the best
knowledge of the Company or the Association, pending or threatened.
(j) 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, free and clear of all liens, charges, encumbrances
or restrictions, except such as are described in the Registration Statement and
Prospectus or such as 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 under which the Company or the
Association hold properties, including those described in the Registration
Statement and Prospectus, are in full force and effect.
(k) The Company and the Association have received an opinion of their
counsel, Xxxxxx Xxxxxxxx and Xxxx, L.L.P., with respect to the federal and state
income tax consequences of the Conversion and of Xxxxx, Xxxxxx and Company, LLP,
with respect to the state income tax consequences of the Conversion, as
described in the Registration Statement and Prospectus and the facts and
representations upon which such opinion is based are truthful, accurate and
complete. Neither the Company nor the Association has taken any actions
inconsistent with such facts or representations.
(l) The Company and the Association have all such power, authority,
authorizations, approvals and orders as may be required to enter into this
Agreement, to carry out the provisions and conditions hereof and, in the case of
the Association as of the Closing Date, will have such approvals and authority
to issue and sell the capital stock of the Association to the Company and, in
the case of the Company as of the Closing Date, will have such approvals and
orders to issue and sell the Shares to be sold by the Company as provided herein
and as described in the Prospectus.
(m) The Company and the Association are not in violation of any directive
received by the Company or the Association from the OTS, the FDIC or any other
governmental agency to make any change in the method of conducting their
businesses so as to comply in all material respects with all applicable statutes
and regulations (including, without limitation, regulations, decisions,
directives and
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orders of the OTS and the FDIC) 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 by the Company and the Association of their obligations under this
Agreement or the consummation of the transactions contemplated in the Plan and
as described in the Registration Statement and the Prospectus or which might
result in any material adverse change in the condition (financial or otherwise),
earnings, capital, properties, assets or business of the Company or the
Association, taken as a whole, or which would materially affect their properties
and assets.
(n) The financial statements which are included in the Registration
Statement and the Prospectus fairly present the balance sheets and the related
statements of income, 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 Title 12 of the Code of Federal Regulations and with generally
accepted accounting principles ("GAAP"). Such financial statements have been
prepared in accordance with GAAP consistently applied through the periods
involved (except as noted therein), present fairly in all material respects the
information required to be stated therein and are consistent with the most
recent financial statements and other reports filed by the Association with the
OTS, except that accounting principles employed in such regulatory filings
conform to the requirements of the OTS 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 adjustments for such pro forma information, the adjustments made therein
have been properly applied on the bases described therein.
(o) 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 condition,
financial or otherwise, of the Company and the Association, taken as a whole, or
in the earnings, capital, properties, assets 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
the debt of the Association (other than debt in the form of deposit accounts),
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 or any material
decrease in surplus and reserves or total assets of the Association, (iii)
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; (iv) there have not been any transactions entered into by the Company
or the Association, except transactions entered into in the ordinary course of
business; (v) the properties and business of the Company and the Association
conform in all material respects to the descriptions thereof contained in the
Prospectus; and (vi) neither the Company nor the Association has any material
contingent liabilities, except as set forth in the Prospectus.
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(p) As of the date hereof and as of the Closing Date, neither the Company
nor the Association is in violation of its articles of incorporation, charter or
bylaws (and the Association will not be in violation of its charter or bylaws in
capital stock form at the time of consummation of the Conversion), or in default
in the performance or observance of any material obligation, agreement,
covenant, or condition contained in any material contract, lease, loan
agreement, indenture or other instrument to which it is a party or by which it
or any of its property may be bound, which would result in a material adverse
change in the condition (financial or otherwise), earnings, capital, assets,
properties or business of the Company and the Association, considered as one
enterprise; 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 against the Company and the Association 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 of 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,
(ii) general equity principles, regardless of whether such enforceability is
considered in a proceeding in equity or at law, or (iii) laws relating to the
safety and soundness of insured depository institutions and their affiliates as
set forth in 12 U.S.C. ss.1818(b), and except to the extent, if any, that the
provisions of Sections 10 and 11 hereof may be unenforceable as against public
policy or by applicable law.
(q) No default exists, and no event has occurred which with notice or lapse
of time, or both, would constitute a material default on the part of the Company
or the Association, in the due performance and observance of any term, covenant
or condition of any material 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
affect on the condition, financial or otherwise, earnings, capital, assets,
properties or business of the Company and the Association, considered as one
enterprise; such agreements are in full force and effect; and, to the best
knowledge of the Company or the Association, no other party to any such
agreements has instituted or 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 Company
or the Association considered as one enterprise.
(r) Upon consummation of the Conversion, the authorized, issued and
outstanding equity capital of the Company will be within the range set forth in
the Prospectus under the caption "Capitalization," and no shares of Common Stock
have been or will be issued and outstanding prior to the Closing Date, the
Shares will have been duly and validly authorized for issuance and, when issued
and delivered by the Company pursuant to the Plan against payment of the
consideration calculated as set forth in the Plan and in the Prospectus, will be
duly and validly issued, fully paid and
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nonassessable; no preemptive rights exist with respect to the Shares; and the
terms and provisions of the Shares will conform to the description thereof
contained in the Registration Statement and the Prospectus. Upon the issuance of
the Shares, good title to the Shares will be transferred from the Company to the
purchasers thereof against payment therefor, subject to such claims as may be
asserted against the purchasers thereof by third party claimants.
(s) No approval of any regulatory or supervisory or other public authority
is required in connection with the execution and delivery of this Agreement or
the issuance of the Shares, except for the approval of the OTS, the Commission
and any necessary qualification, notification, registration or exemption under
the Blue Sky Laws of the various states in which the Shares are to be offered,
and except as may be required under the rules and regulations of the NASD and
the Nasdaq Stock Market.
(t) Xxxxx, Xxxxxx and Company LLP, which has issued its Independent
Auditors' Report in respect of the balance sheets of the Association as of June
30, 1996 and 1995, and the related statements of income, retained earnings and
cash flows for each of the three years in the period ended June 30, 1996, which
are included in the Registration Statement 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.
(u) Xxxxxx & Company, Inc., which has prepared the Association's Conversion
Valuation Appraisal Report as of January 10, 1997, 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.
(v) The Company and the Association have timely filed all required federal,
state and local tax returns; the Company and the Association have paid all taxes
that have become due and payable in respect of such returns; and except where
permitted to be extended, have made adequate reserves for similar future tax
liabilities and no deficiency has been asserted with respect thereto by any
taxing authority.
(w) The Association is in compliance in all material respects with the
applicable financial record-keeping and reporting requirements of the Currency
and Foreign Transactions Reporting Act of 1970, as amended, and the regulations
and rules thereunder.
(x) Neither the Company nor the Association has made any payment of funds
of the Association as a loan for the purchase of the Shares or made any other
payment of funds prohibited by law, and no funds have been set aside to be used
for any payment prohibited by law.
(y) Prior to the completion of the Conversion, neither the Company nor the
Association: (i) issued any securities within the last 18 months (except for
notes to evidence other bank loans or other liabilities and for deposit accounts
in the ordinary course of business or as described in the
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Prospectus and, with respect to the Company, except for shares issued in
connection with the initial capitalization of the Company); (ii) had any
dealings within the 12 months prior to the date hereof with any member of the
NASD, or any person related to or associated with such member, other than
discussions and meetings relating to the proposed 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 between the Agent and the Company
and the Association in connection with the Offering, and no person is being
compensated in any manner for such service.
(z) 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.
(aa) The Company is not required to be registered under the Investment
Company Act of 1940, as amended.
(bb) All documents delivered by the Association or the Company or their
representatives in connection with the issuance and sale of the Common Stock, or
in connection with the Agent's exercise of due diligence, were on the dates on
which they were delivered, accurate and complete in all material respects.
(cc) The records of account holders, depositors, borrowers and other
members of the Association are accurate and complete in all material respects.
The Agent shall have no liability to any person for the accuracy, reliability
and completeness of such records or for the denial or reduction of a
subscription to purchase Common Stock, whether as a result of a properly
calculated allocation pursuant to the Plan or otherwise, if such denial is based
upon such records.
(dd) To the best knowledge of the Company and the Association, the Company
and the Association are in compliance 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. To the
best knowledge of the Company and the Association, there are no actions, suits,
regulatory investigations or other proceedings 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. 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 of the facilities or properties of the Company or the Association.
-11-
Any certificates 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 5. Representation and Warranties of the Agent.
The Agent represents and warrants to the Company and the Association that:
(i) The Agent is a corporation and is validly existing 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.
(ii) The execution and delivery of this Agreement and the consummation
of the transactions contemplated hereby have been duly and validly
authorized by all necessary action on the part of 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.
(iii) The Agent and its employees, 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; and the Agent is a registered selling agent in each
of the jurisdictions in which the Shares are to be offered by the Company
in reliance upon the Agent as a registered selling agent as set forth in
the blue sky memorandum prepared with respect to the Offering.
(iv) 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 will not conflict with, or result in a
breach of, any of the terms, provisions 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 the Agent or
any material agreement, indenture or other instrument to which the Agent is
a party or by which it or its property is bound.
(v) No approval of any regulatory or supervisory or other public
authority is required in connection with Agent's execution and delivery of
this Agreement, except as may have been received.
(vi) There is no suit or proceeding or charge or action before or by
any court, regulatory authority or government agency or body or, to the
knowledge of Agent, pending or threatened, which might materially and
adversely affect the Agent's performance of this Agreement.
-12-
Section 6. 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, at any time after the date the Registration
Statement is declared effective, file any amendment or supplement to the
Registration Statement without providing the Agent and its counsel with an
opportunity to review such amendment or supplement or file any amendment or
supplement to which amendment or supplement the Agent or its counsel shall
reasonably object.
(b) The Association will not, at any time after the Conversion Application
is approved by the OTS, file any amendment or supplement to such Conversion
Application without providing the Agent and its counsel with an opportunity to
review such amendment or supplement or file any amendment or supplement to which
amendment or supplement the Agent or its counsel shall reasonably object.
(c) The Company will not file any amendment or supplement to such Holding
Company Application without providing the Agent and their counsel with an
opportunity to review such amendment or supplement or file any amendment or
supplement to which amendment or supplement the Agent or its counsel shall
reasonably object.
(d) 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-effective amendment to the Conversion
Application to be approved by the OTS and will, immediately upon receipt of any
information concerning the events listed below, notify the Agent: (i) when the
Registration Statement, as amended, has become effective; (ii) when the
Conversion Application, as amended, has been approved by the OTS; (iii) when the
Holding Company Application, as amended, has been approved by the OTS; (iv) of
any comments from the Commission, the OTS, or any other governmental entity with
respect to the Conversion or the transactions contemplated by this Agreement;
(v) of the request by the Commission, the OTS, or any other governmental entity
for any amendment or supplement to the Registration Statement, the Conversion
Application or the Holding Company Application, or for additional information;
(vi) of the issuance by the Commission, the OTS or any other governmental entity
of any order or other action suspending the Offering or the use of the
Registration Statement or the Prospectus or any other filing of the Company or
the Association under the Conversion Regulations, or other applicable law, or
the threat of any such action; (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
Holding Company Application, or of the initiation or threat of initiation or
threat of any proceedings for any such purpose; or (viii) of the occurrence of
any event mentioned in paragraph (h) below. The Company and the Association will
make every reasonable effort (i) to prevent the issuance by the Commission, the
OTS or any other state authority of any such order and, if any such order shall
at any time be issued, (ii) to obtain the lifting thereof at the earliest
possible time.
-13-
(e) The Company and the Association will deliver to the Agent and to its
counsel two conformed copies of the Registration Statement, the Conversion
Application and the Holding Company Application, as originally filed and of each
amendment or supplement thereto, including all exhibits. The Company and the
Association also will deliver such additional copies of the foregoing documents
to counsel to the Agent as may be required for any NASD filings.
(f) 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").
The Company authorizes the Agent to use the Prospectus in any lawful manner
contemplated by the Plan in connection with the sale of the Shares.
(g) 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 or the OTS to be
complied with subsequent to the Closing Date and when the Prospectus is required
to be delivered, the Company and the Association will comply, at their own
expense, with all requirements imposed upon them by the Commission or the OTS,
including, without limitation, Rule 10b-5 under the 1934 Act; in each case as
from time to time in force, so far as necessary to permit the continuance of
sales or dealing in shares of Common Stock during such period in accordance with
the provisions hereof and the Prospectus.
(h) If, at any time during the period when the Prospectus relating to the
Shares is required to be delivered, any event relating to or affecting the
Company 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 to a purchaser, the Company and the Association will, at
their 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 will amend or supplement the Registration Statement or
Prospectus so that as amended or supplemented it will not contain an untrue
statement of a material fact or omit to state a material fact necessary in order
to make the statements therein, in light of the circumstances existing at the
time the Prospectus is delivered to a purchaser, not misleading. For the purpose
of this Agreement, the Company and the Association each will timely furnish to
the Agent such information with respect to the Company and the Association as
the Agent may from time to time reasonably request.
(i) The Company and the Association will take all necessary actions as may
be required to qualify or register the Shares for offering and sale by the
Company or to exempt such Shares from registration, or to exempt the Company as
a broker-dealer and its officers, directors and employees
-14-
as broker-dealers or agents, under the Blue Sky Laws of such jurisdictions in
which the Shares are required under the Conversion Regulations to be sold or as
the Agent and the Company and the 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. In each jurisdiction where any of the Shares
shall have been qualified or registered as above provided, the Company will make
and file such statements and reports in each fiscal period as are or may be
required by the laws of such jurisdiction.
(j) The liquidation account for the benefit of Eligible Account Holders and
Supplemental Eligible Account Holders will be duly established and maintained in
accordance with the Conversion Regulations.
(k) The Company and the Association will not sell or issue, contract to
sell or otherwise dispose of, for a period of 90 days after the Closing Date,
without the Agent's prior written consent, any shares of Common Stock other than
in connection with any plan or arrangement described in the Prospectus.
(l) The Company shall register its Common Stock under Section 12(g) of the
1934 Act concurrent with the Offering pursuant to the Plan and shall request
that such registration be effective upon completion of the Conversion. The
Company shall maintain the effectiveness of such registration for not less than
three years.
(m) During the period during which the Common Stock is registered under the
1934 Act or for three years from the date hereof, whichever period is greater,
the Company will furnish to its stockholders as soon as practicable after the
end of each fiscal year an annual report of the Company (including a
consolidated balance sheet and statements of consolidated income, stockholders'
equity and cash flows of the Company and its subsidiaries as at the end of and
for such year, certified by independent public accountants in accordance with
Regulation S-X under the 1933 Act and the 1934 Act).
(n) During the period of three years from the date hereof, the Company will
furnish to the Agent: (i) as soon as practicable after such information is
publicly available, a copy of each report of the Company furnished to or filed
with the Commission under the 1934 Act or any national securities exchange or
system on which any class of securities of the Company is listed or quoted
(including, but not limited to, reports on Forms 10-K, 10-Q and 8-K and all
proxy statements and annual reports to stockholders), (ii) a copy of each other
non-confidential report of the Company mailed to its stockholders or filed with
the Commission, the OTS or any other supervisory or regulatory authority or any
national securities exchange or system on which any class of securities of the
Company is listed or quoted, each press release and material news items and
additional documents and information with respect to the Company or the
Association as the Agent may reasonably request; and (iii) from time to time,
such other nonconfidential information concerning the Company or the Association
as the Agent may reasonably request
-15-
(o) 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."
(p) Neither the Company nor the Association will distribute any prospectus,
offering circular or other offering material in connection with the offer and
sale of the Shares without first notifying the Agent and unless permitted by the
Conversion Regulations, the 1933 Act, the 1933 Act Regulations and the Blue Sky
Laws in any state in which the Shares are registered or qualified for sale or
exempt from registration.
(q) The Company will use its best efforts to (i) encourage and assist two
market makers to establish and maintain a market for the Shares and (ii) list
the Shares on a national securities exchange or on The Nasdaq Stock Market
effective on or prior to the Closing Date.
(r) The Association will maintain appropriate arrangements for depositing
all funds received from persons mailing subscriptions for or orders to purchase
Shares in the Offering in an interest bearing account as 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 described in the Prospectus or until refunds of such funds have
been made to the persons entitled thereto or withdrawal authorizations canceled
in accordance with the Plan and as described in the Prospectus. The 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 funds are required to be made in accordance with
the Plan and as described in the Prospectus.
(s) The Company will register as a savings and loan holding company under
the HOLA within 90 days of the Closing Date.
(t) 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."
(u) The Association will not amend the Plan of Conversion in any manner
that, in the reasonable opinion of the Agent, would materially and adversely
affect the sale of the Shares or the terms of this Agreement without first
notifying and receiving the consent of the Agent.
(v) The Agent shall assist the Company in connection with the allocation of
the Shares in the event of an oversubscription and the Company shall provide the
Agent with all information necessary for the' allocation of the Shares, and such
information shall be accurate and reliable.
(w) Prior to the Closing Date, the Company and the Association will inform
the Agent of any event or circumstances of which they are aware as a result of
which the Registration Statement, the Conversion Application and/or Prospectus,
as then amended or supplemented, would contain an
-16-
untrue statement of a material fact or omit to state a material fact necessary m
order to make the statements therein not misleading.
(x) Prior to the Closing Date, the Plan shall have been approved by the
eligible voting members of the Association in accordance with the Conversion
Regulations and the provisions of Association's mutual charter and bylaws.
(y) The Association and the Company will conduct the Conversion in
accordance with the Plan, all applicable laws and regulations and in the manner
described in the Prospectus.
(z) The Company will comply with the provisions of Rule 158 of the 1933
Act Regulations.
(aa) The Company will file with the Commission, within the time period
specified by statute or regulation, a report on Form SR pursuant to Rule 463 of
the 1933 Act Regulations.
(bb) The Company and the Association will 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 9 hereof.
(cc) The Company and the Association will 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.
(dd) Upon completion of the sale by the Company of the Shares contemplated
by the Prospectus, (i) the Association will have been converted pursuant to the
Plan to a federal stock savings and loan association, (ii) all of the authorized
and outstanding capital stock of the Association will be owned by the Company,
and (iii) the Company will have no direct subsidiaries other than the
Association. The Conversion will 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, will have been complied with by the Company
and the Association in all material respects or appropriate waivers will have
been obtained and all notice and waiting periods will have been satisfied,
waived or elapsed.
Section 7. Covenants of the Agent. The Agent hereby covenants with the
Company and the Association as follows:
(a) During the period when the Prospectus is used, the Agent will 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, and the Agent shall remain a registered
selling agent in all such jurisdictions in which the Company is so relying for
the
-17-
sale of Shares as set forth in the blue sky memorandum with respect to the
Offering until the Conversion is consummated or terminated.
(b) The Agent will 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 8. Payment of Expenses. Whether or not the Conversion is completed
or the sale of the Shares by the Company is consummated, the Company and the
Association jointly and severally agree to pay or reimburse the Agent for: (a)
all filing fees in connection with all filings with the NASD; (b) any stock
issue or transfer taxes which may be payable with respect to the sale of Shares;
(c) all reasonable expenses of the Conversion, including, but not limited to,
the Company and the Association's attorneys' fees (including Blue Sky legal fees
and disbursements), the Agent's reasonable attorneys' fees, transfer agent,
registrar and other agent charges, fees relating to auditing and accounting or
other advisors, and costs of printing all documents necessary in connection with
the Conversion; and (d) all reasonable out-of-pocket expenses incurred by the
Agent other than travel and accommodation expenses incurred by employees of the
Agent. Such out-of-pocket expenses include, but are not limited to,
communications and postage. In the event the Company is unable to sell a minimum
of 1,062,500 Shares or the Conversion is terminated or otherwise abandoned, the
Company and the Association shall reimburse the Agent in accordance with Section
2 hereof.
Section 9. Conditions to the Agent's Obligations. The Agent's obligations
hereunder, as to the Shares to be delivered at the Closing Date, are subject, to
the extent not waived 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 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 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 therefor
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 therefor
initiated or, to the best of the Company's and the Association's knowledge,
threatened by the Commission, the OTS or any other federal or state authority.
-18-
(c) At the Closing Date, the Agent shall have received:
(1) The favorable opinion, dated as of the Closing Date and addressed
to the Agent and for its benefit, of Silver, Xxxxxxxx & Xxxx, L.L.P.,
counsel for the Company and the Association, in form and substance to the
effect that:
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of 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.
(ii) The Association has been incorporated and is validly
existing as a federal mutual savings and loan association in good
standing under the laws of the United States and upon the consummation
of the Conversion will become a duly organized and validly existing
federal stock savings and loan association in good standing 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 the
consummation of the Conversion, all of the issued and outstanding
capital stock of the Association will be duly authorized and, upon
payment therefor, will be validly issued, fully paid and nonassessable
and all such capital stock will be owned of record, and to the best of
such counsel's knowledge, 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 the best of
such counsel's knowledge, no proceedings for the termination or
revocation of such membership or insurance are pending or threatened.
(iv) The description of the liquidation account as set forth in
the Prospectus under the caption "The Conversion-Effects of Conversion
to Stock Form on Depositors and Borrowers of the
Association-Liquidation Rights" to the extent that such information
constitutes matters of law and legal conclusions, has been reviewed by
such counsel and is accurate in all material respects.
(v) No shares of Common Stock have been issued prior to the
Closing Date; at the time of the consummation of the Conversion, the
Shares subscribed for pursuant to the Prospectus will have been duly
and validly authorized for issuance, and when issued and delivered by
the Company pursuant to the Plan against payment of the consideration
calculated as set forth in the Plan and the Prospectus, will be duly
and validly issued and fully paid and non-assessable. The issuance of
the Shares will not be subject to preemptive rights and the terms and
provisions of the Shares
-19-
conform to the description thereof contained in the Prospectus. The
form of certificate used to evidence the Common Stock is in due and
proper form and complies with all applicable legal requirements.
(vi) The execution and delivery of this Agreement and the
consummation of the transactions contemplated thereby 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 to
the extent rights to indemnity and contribution thereunder may be
limited under applicable law and except as the enforceability thereof
may be limited 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 or by general equitable principles,
regardless of whether such enforceability is considered in a
proceeding in equity or at law; and to the best of our knowledge, the
execution and delivery of the Agreement, and the consummation of the
transactions contemplated thereunder, will not conflict with or
constitute a breach of, or default under, and no event has occurred
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 that would have a material adverse effect on the
financial condition, results of operations or business of the Company
and the Association taken as a whole, upon any property or assets of
the Company or the Association pursuant to 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 either
of them may be bound, or to which any of the property or assets of the
Company or the Association is subject (other than the establishment of
a liquidation account), nor will such execution or delivery result in
any violation of the provisions of the articles of incorporation,
charter, or bylaws of the Company or the Association, or any
applicable Delaware law, act or regulation (except that no opinion
need be rendered with respect to the securities or Blue Sky Laws of
various jurisdictions or the rules and regulations of the NASD).
(vii) The Conversion Application has been approved by the OTS and
the Prospectus and the proxy statement of the Association have been
authorized for use by the OTS. The OTS has approved the Holding
Company Application, and the purchase by the Company of all of the
issued and outstanding capital stock of the Association has been
authorized by the OTS. To the best of such counsel's knowledge, no
action is pending or threatened to revoke any such authorizations or
approvals.
(viii) The Plan has been duly adopted by the required vote of the
directors of the Company and the Association and approved by the
eligible voting members of
-20-
the Association in accordance with the Conversion Regulations and the
applicable requirements of 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 (as to which no opinion need be rendered) and
except as may be required under the rules and regulations of the NASD
(as to which no opinion need be rendered).
(x) The Registration Statement is effective under the 1933 Act
and no stop order suspending the effectiveness has been issued under
the 1933 Act or, to the best of such counsel's knowledge, proceedings
therefor initiated or threatened by the Commission or any other
governmental agency.
(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, complied as
to form in all material respects with the requirements of the
Conversion Regulations, the HOLA, and those of any other applicable
federal or state laws (other than the financial statements, the notes
thereto, financial tables, and other financial, statistical and
appraisal data including therein, as to which no opinion need be
rendered).
(xii) At the time that the Registration Statement became
effective, (i) the Registration Statement (except as to 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,
(ii) the Prospectus (other than the financial statements, the notes
thereto and other tabular, financial, statistical and appraisal data
included therein, as to which no opinion need be rendered) complied as
to form in all material respects with the requirements of the 1933 Act
and the 1933 Act Regulations; and (iii) the Registration Statement has
been filed pursuant to the appropriate Commission form and has been
declared effective by the Commission.
(xiii) To the best of such counsel's knowledge, there are no
legal or governmental proceedings pending or threatened which are
required to be disclosed in the Registration Statement and Prospectus,
other than those disclosed therein.
(xiv) To the best of 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
-21-
Statement or required to be filed as exhibits thereto other than those
described or referred to therein or filed as exhibits thereto and the
descriptions thereof are accurate.
(xv) To the best of such counsel's knowledge, the Conversion
Application, the Holding Company Application and the Plan comply in
all material respects with all applicable laws, rules, regulations and
decisions and orders, including, without limitation, the HOLA, the
Conversion Regulations, or any requirements of Delaware law; the Plan
and the transactions contemplated by this Agreement have been duly
approved and authorized by all requisite corporate and regulatory
action; to the best of such counsel's knowledge, no order has been
issued by the OTS, the Commission or any other authority to suspend
the Offering or the use of the Prospectus, and, to the best of such
counsel's knowledge, no action for such purposes has been instituted
or threatened by the OTS, the Commission, or any other authority and,
to the best of such counsel's knowledge, no person has sought to
obtain regulatory or judicial review of the final action of the OTS,
the Commission, as applicable, approving or taking no objection to the
Plan, the Conversion Application, the Holding Company Application, the
Prospectus, or the Conversion.
(xvi) To the best of 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 and the Association taken as a whole, and all such
licenses, permits and other governmental authorizations are in full
force and effect, and the Company and the Association are in all
material respects complying therewith.
(xvii) To the best of such counsel's knowledge, neither the
Company nor the Association is in violation of its articles of
incorporation, charter or bylaws, or in default or violation in the
performance or observance of any obligation, agreement, covenant or
condition contained in any 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 or the Association or
any of their property may be bound in any respect that would have a
material adverse effect on the financial condition or results of
operations of the Company or the Association taken as a whole.
(xviii) To the best of such counsel's knowledge, neither the
Company nor the Association is in violation of any directive from the
OTS or the FDIC to make any material change in the method of
conducting its respective business.
-22-
(xix) The information in the Prospectus under the captions
"Regulation," "The Conversion -- Income Tax Consequences,"
"Restrictions on Acquisitions of Stock and Related Takeover Defensive
Provisions," "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 correct 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. 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 shall have
received a copy of such proceedings, order, stop order or action.
In addition, such counsel shall provide a letter stating that during the
preparation of the Registration Statement, Conversion Application and the
Prospectus, 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 Conversion 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).
(2) The favorable opinion, dated as of the Closing Date, of Xxxxxx &
Xxxxxxxxx, Indianapolis, Indiana, the Agent's counsel, with respect to such
matters as the Agent may reasonably require. Such opinion may rely upon the
opinions of counsel to the Company and the Association, and 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 states: (i) they
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have reviewed the Prospectus and, in their opinion, at the time the Prospectus
became authorized for final use, the Prospectus did not contain any untrue
statement of a material fact or omit to state a material fact necessary in order
to make the statements therein, in light of the circumstances under which they
were made, not misleading; (ii) since the respective dates as of which
information is given in the Registration Statement and the Prospectus and since
the date the Prospectus became authorized for final use, no material adverse
change in the condition, financial or otherwise, or in the earnings, capital,
properties, assets, 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 9 have been
satisfied; (iii) the representations and warranties in Section 4 are true and
correct with the same force and effect as though expressly made at and as of the
Closing Date; (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 Conversion; (v) no
stop order suspending the effectiveness of the Registration Statement has been
initiated or, to the best knowledge of the Company or the Association,
threatened by the Commission or any state authority; (vi) no order suspending
the Offering, the Conversion, the acquisition of all of the Shares of the
Association by the Company or the effectiveness of the Prospectus has been
issued and no proceedings for that purpose are pending or, to the best knowledge
of the Company or the Association, threatened by the OTS, the Commission or any
other authority; (vii) to the best knowledge of the Company or the Association,
no person has sought to obtain review of the final action of the OTS approving
the Plan; and (viii) neither the Company nor the Association is required to be
qualified to do business as a foreign corporation in any jurisdiction.
(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 condition,
financial or otherwise, 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 from the OTS or the FDIC any directive (oral or written) 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
best knowledge of the Company or 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 Company and the Association
considered as one enterprise; and (v) the Shares have been qualified or
registered for offering and sale or exempted therefrom under the Blue Sky Laws
of
-24-
such jurisdictions as the Agent shall have requested and as agreed to by the
Company and the Association.
(f) Concurrently with the execution of this Agreement, the Agent shall
receive a letter from Xxxxx, Xxxxxx and Company LLP dated the date hereof and
addressed to the Agent: (i) confirming that Xxxxx, Xxxxxx and Company LLP is a
firm of independent public accountants within the meaning of the 1933 Act, the
1933 Act Regulations, 12 CFR 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 consolidated financial statements of the
Association as of June 30, 1996, and 1995, and for the fiscal years ended June
30, 1994, 1995, and 1996, as are 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 consolidated 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
consolidated financial statements included in the Prospectus to a specified date
not more than five 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 consolidated retained earnings of the Association at the date of
such letter as compared with amounts shown in the latest audited consolidated
statement of condition included in the Prospectus or there was any decrease in
consolidated 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 consolidated 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 you 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 Xxxxx,
Xxxxxx and Company LLP dated the Closing Date, addressed to the Agent,
confirming the statements made by
-25-
them in the letter delivered by them pursuant to subsection (f) of this Section
9, 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.
(h) At the Closing Date, the Agent shall receive a letter from Xxxxxx &
Company, Inc., dated the date thereof and addressed to counsel for 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 consolidated 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 letter from the OTS approving the Conversion Application and the use of the
Prospectus; (ii) a copy of the order from the Commission declaring the
Registration Statement effective; (iii) a certificate of good standing from the
State of Delaware evidencing the good standing of the Company; (iv) a
certificate of valid existence from the OTS with respect to the Association; (v)
a certificate from the FDIC evidencing the Association's insurance of accounts;
(vi) a certificate of the FHLB-Cincinnati evidencing the Association's
membership thereof; (vii) a copy of the letter from the OTS approving the
Holding Company Application; and (viii) any other documents that the Agent shall
reasonably request.
(k) As soon as available after the Closing Date, the Agent shall receive,
upon request, a copy of the Association's charter.
(l) Subsequent to the date hereof, there shall not have occurred any of the
following: (i) a suspension or limitation in trading in securities generally on
the New York Stock Exchange or in the over-the-counter market, or quotations
halted generally on the Nasdaq Stock Market, or minimum or maximum prices for
trading have been fixed, or maximum ranges for prices for securities have been
required by either of such exchanges or the NASD or by order of the Commission
or any other governmental authority; (ii) a general moratorium on the operations
of commercial banks, Ohio 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 if the effect
of any of the above in the Agent's reasonable
-26-
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 10. 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 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 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 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 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), final
Prospectus (or any amendment or supplement thereto), the Conversion Application
(or any amendment or supplement thereto), the Holding Company Application 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 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; (ii) 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 (iii) arise
from any theory of liability whatsoever relating to or arising from or based
upon the Registration Statement (or any amendment or supplement thereto), final
Prospectus (or any amendment or supplement thereto), the Conversion Application
(or any amendment or supplement thereto), any Blue Sky Application or Sales
Information or other documentation 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), preliminary or final
Prospectus (or any amendment or supplement thereto), the Conversion Application,
any Blue Sky Application or Sales Information made in reliance upon and in
conformity with information furnished in writing to the Company or the
Association by the Agent regarding the Agent.
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(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 within the meaning of Section 15 of the 1933 Act
or Section 20(a) of the 1934 Act against any and all loss, liability, claim,
damage or expense whatsoever (including but not limited to settlement expenses),
joint or several, which they, or any of them, may suffer or to which they, or
any of them may become, subject under all applicable federal and state laws or
otherwise, and to promptly reimburse the Company, the 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 10(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 10 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 indemnified
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.
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(d) The agreements in this Section 10 and in Section 11 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 Company or the Association; (ii) delivery of and
payment hereunder for the Shares; or (iii) any termination of this Agreement.
Section 11. Contribution. In order to provide for just and equitable
contribution in circumstances in which the indemnification provided for in
Section 10 is due in accordance with its terms but is 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 paid to the Agent pursuant
to Section 2 of this Agreement (not including expenses) bears to the gross
proceeds received by the Company from the sale 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 10 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 total gross proceeds from the
Offering received by the Company bear to the total fees (excluding 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 or the alleged omission to state a material fact relates to
information supplied by the Company and/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 11 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 11.
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 11 shall be deemed to include any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action, proceeding or claim.
It is expressly agreed that the Agent shall not be liable for any loss,
liability, claim, damage or expense
-29-
or be required to contribute any amount which in the aggregate exceeds the
amount paid (excluding reimbursable expenses) to the Agent under this Agreement.
It is understood that the above stated limitation on the Agent's liability is
essential to the Agent and that the Agent would not have entered into this
Agreement if such limitation had not been agreed to by the parties to this
Agreement. No person found guilty of any fraudulent misrepresentation (within
the meaning of Section 11(f) of the 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 11 and
under Section 10 shall be in addition to any liability which the Company and the
Association may otherwise have. For purposes of this Section 11, each of the
Agent's, the Company's or the Association's officers and 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 11, will
notify such party from whom contribution may be sought, but the omission to so
notify such party shall not relieve the party from whom contribution may be
sought from any other obligation it may have hereunder or otherwise than under
this Section 11. In no case shall the Agent be required to contribute any amount
in excess of the fees received by the Agent pursuant to Section 2 of this
Agreement
Section 12. 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 and the
Association 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 10 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 13. Termination. The Agent may terminate its obligations under this
Agreement by giving the notice indicated below in this Section 13 at any time
after this Agreement becomes effective as follows:
(a) In the event 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 for
payment by the Company and/or the Association as set forth in Sections 2 ,8, 10
and 11 hereof.
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(b) If any of the conditions specified in Section 9 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 14 hereof in writing or by telegram at
any time at or prior to the Closing Date, and any such cancellation shall be
without liability of any party to any other party except as otherwise provided
in Sections 2, 8, 10 and 11 hereof.
(c) If the Agent elects to terminate this Agreement as provided in this
Section 13, the Agent shall promptly notify the Company and the Association by
telephone or telegram, confirmed by letter.
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 5 and 7 and such breach has
not been cured after the Company and the Association have provided Agent with
notice of such breach.
The Agent may terminate this Agreement with respect to the Company and the
Association in the event that either the Company or the Association,
respectively, 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 Agent have provided the Company and the Association with notice of such
breach.
This Agreement may also be terminated by mutual written consent of the
parties hereto.
Section 14. Notices. All communications hereunder, except as herein
otherwise specifically provided, shall be mailed in writing and if sent to Agent
shall be mailed, delivered or telegraphed and confirmed to Xxxxxxx Xxxx &
Company, 000 Xxxxxxxxx, Xxxxxx, Xxxx 00000-5034, Attention: Xxxxxxxx X. XxXxxxx
(with a copy to Xxxxxx & Xxxxxxxxx, 11 So. Meridian Street, Indianapolis,
Indiana 46204, Attention: Xxxxxxx X. Xxxxxx, Esquire) and, if sent to the
Company and the Association, shall be mailed, delivered or telegraphed and
confirmed to the Company and the Association at 000 Xxxx Xxxxx Xxxxxx, Xxxxxx,
Xxxx 00000 Attention: Xxxxxxx Xxxxxxx, President and Chief Executive Officer
(with a copy to Silver, Xxxxxxxx and Xxxx, L.L.P., 0000 Xxx Xxxx Xxxxxx, X.X.,
Xxxxxxxxxx, X.X. 00000, Attention: Xxxxxxx X. Xxxxxxx, P.C.).
Section 15. Parties. The Company and the Association shall be entitled to
act and rely on any request, notice, consent, waiver or agreement purportedly
given on behalf of the Agent when the same shall have been given by the
undersigned. The Agent shall be entitled to act and rely on any request, notice,
consent, waiver or agreement purportedly given on behalf of the Company or the
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,
-31-
remedy or claim under or in respect of or by virtue of this Agreement or any
provision herein contained.
Section 16. Entire Agreement. It is understood and agreed that this
Agreement is the exclusive agreement among the paries 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 17. Closing. The closing for the sale of the Shares shall take
place on the Closing Date at such location as mutually agreed upon by the Agent
and the Company and the Association. At the closing, the Company and the
Association shall deliver to the Agent in next day funds the commissions, fees
and expenses due and owing to the Agent as set forth in Sections 2 and 8 hereof
and the opinions and certificates required hereby and other documents deemed
reasonably necessary by the Agent shall be executed and delivered to effect the
sale of the Shares as contemplated hereby and pursuant to the terms of the
Prospectus.
Section 18. 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.
Section 19. Construction. This Agreement shall be construed in accordance
with the laws of the State of Ohio, except to the extent that federal law shall
apply.
Section 20. 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,
XXXXXXX XXXXXX FINANCIAL PEOPLES FEDERAL SAVINGS
CORPORATION AND LOAN ASSOCIATION
By: By:
------------------------------ ------------------------------
Xxxxxxx Xxxxxxx, President Xxxxxxx Xxxxxxx, President
Accepted as of the date first above written.
XXXXX, XXXXXXXX & XXXXX, INC.
By XXXXXXX XXXX & COMPANY,
A Division Thereof
By:
------------------------------
Xxxxxxxx X. XxXxxxx, Executive
Vice President
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EXHIBIT A
XXXXXXX XXXXXX FINANCIAL CORPORATION
Up to 1,653,125 Shares (Anticipated Maximum)
($0.01 Par Value)
Selected Dealers' Agreement
_________, 1997
Gentlemen:
We have agreed to assist Peoples Federal Savings and Loan Association of
Sidney, Sidney, Ohio ("Association"), a federal mutual savings and loan
association, in connection with the offer and sale of up to 1,437,500 shares
(subject to possible increase to 1,653,125 shares) of the common stock, $0.01
par value ("Common Stock"), of Xxxxxxx Xxxxxx Financial Corporation, Sidney,
Ohio ("Company"), a Delaware corporation, to be issued in connection with the
conversion of the Association from a mutual institution to a stock institution
pursuant to the Home Owners' Loan Act, as amended, and 12 C.F.R. Part 563b. The
total number of shares of Common Stock to be offered may be decreased to a
minimum of 1,062,500 shares. The price per share has been fixed at $10.00. The
Common Stock, the number of shares to be issued, and certain of the terms on
which they are being offered, are more fully described in the enclosed
Prospectus dated __________, 1997 ("Prospectus"). In connection with the
Conversion, the Company, on a best efforts basis, is offering for sale between
$10,625,000 of shares and $14,375,000 (subject to possible increase to
$16,531,250) of shares of the Common Stock ("Shares"), in a Subscription
Offering (as defined in the Prospectus). Any Shares not sold in the Subscription
Offering will be offered to the general public in the Community Offering (as
defined in the Prospectus) giving preference to natural persons residing in
Shelby County, Ohio.
The Subscription and Community Offerings are being conducted under a plan
of conversion ("Plan"), adopted by the Association's Board of Directors.
Pursuant to the Plan, the Association intends to convert from a federal mutual
savings and loan association to a federal stock savings and loan association and
concurrently become the wholly-owned subsidiary of the Company ("Conversion").
The Subscription and Community Offerings are further being conducted in
accordance with the regulations of the OTS and subject to the provisions
contained in the Plan.
The Common Stock is also being offered in accordance with the Plan by
broker/dealers licensed by the National Association of Securities Dealers, Inc.
("NASD") which have been approved by the Association ("Approved Brokers").
We are offering the Approved Brokers (of which you are one) the opportunity
to participate in the solicitation of offers to buy the Common Stock and we will
pay you a fee in the amount of
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____ percent (____%) of the dollar amount of the Common Stock sold on behalf of
the Company by you, as evidenced by the authorized designation of your firm on
the order form or forms for payment therefor to the special account established
by the Association for the purpose of holding such funds. It is understood, of
course, that payment of your fee will be made only out of compensation received
by us for the Common Stock sold on behalf of the Company by you, as evidenced in
accordance with the preceding sentence. As soon as practicable after the closing
date of the offering, we will remit to you, only out of our compensation as
provided above, the fees to which you are entitled hereunder.
Each order form for the purchase of Common Stock must set forth the
identity and address of each person to whom the certificates for such Common
Stock should be issued and delivered. Such order form also must clearly identity
your firm in order for you to receive compensation. You shall instruct any
subscriber who elects to send his order form to you to make any accompanying
check payable to "Xxxxxxx Xxxxxx Financial Corporation."
This offer is made subject to the terms and conditions herein set forth and
is made only to Approved Brokers who are members in good standing of the NASD
who are to comply with all applicable rules of the NASD, including, without
limitation, the NASD's Interpretation With Respect to Free-Riding and
Withholding and Section 24 of Article III of the NASD's Rules of Fair Practice.
Orders for Common Stock will be subject to confirmation and we, acting on
behalf of the Company and the Association, reserve the right in our unfettered
discretion to reject any order in whole or in part, to accept or reject orders
in the order of their receipt or otherwise, and to allot. Neither you nor any
other person is authorized by the Company and the Association, or by us to give
any information or make any representations other than those contained in the
Prospectus in connection with the sale of any of the Common Stock. No Approved
Broker is authorized to act as agent for us when soliciting offers to buy the
Common Stock from the public or otherwise. No Approved Broker shall engage in
any stabilizing (as defined in Rule 10b-7 promulgated under the Securities
Exchange Act of 1934) with respect to the Company's Common Stock during the
offering.
We and each Approved Broker assisting in selling Common Stock pursuant
hereto agree to comply with the applicable requirements of the Securities
Exchange Act of 1934 and applicable state rules and regulations. Each
customer-carrying selected dealer that is not a $250,000 net capital reporting
broker/dealer agrees that it will not use a sweep arrangement and that it will
transmit all customer checks by noon of the next business day after receipt
thereof. In addition, we and each selected dealer confirm that the Securities
and Exchange Commission interprets Rule 15c2-8 promulgated under the Securities
Exchange Act of 1934 as requiring that a Prospectus be supplied to each person
who is expected to receive a confirmation of sale 48 hours prior to delivery of
such person's order form.
We and each Approved Broker further agree that to the extent that your
customers desire to pay for shares with funds held by or to be deposited with
us, in accordance with the interpretations of the Securities and Exchange
Commission of Rule 15c2-4 promulgated under the Securities
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Exchange Act of 1934, either (a) upon receipt of an executed order form or
direction to execute an order form on behalf of a customer to forward the
offering price of the Common Stock ordered on or before noon of the next
business day following receipt or execution of an order form by us to the
Company for deposit in a segregated account or (b) to solicit indications of
interest in which event (i) we will subsequently contact any customer indicating
interest to confirm the interest and give instructions to execute and return an
order form or to receive authorization to execute the order form on the
customer's behalf, (ii) we will mail acknowledgments of receipt of orders to
each customer confirming interest on the business day following such
confirmation, (iii) we will debit accounts of such customers on the third
business day ("Debit Date") following receipt of the confirmation referred to in
(i), and (iv) we will forward complete order forms together with such funds to
the Company on or before twelve noon on the next business day and each selected
dealer acknowledges that if the procedure in (b) is adopted, our customers'
funds are not required to be in their accounts until the Debit Date.
Unless earlier terminated by us, this Agreement shall terminate upon the
closing date of the Conversion. We may terminate this Agreement or any
provisions hereof at any time by written or telegraphic notice to you. Of
course, our obligations hereunder are subject to the successful completion of
the Conversion.
You agree that at any time or times prior to the termination of this
Agreement you will, upon our request, report to us the number of shares of
Common Stock sold on behalf of the Company by you under this Agreement.
We shall have full authority to take such actions as we may deem advisable
in respect of all matters pertaining to the offering. We shall be under no
liability to you except for lack of good faith and for obligations expressly
assumed by us in this Agreement.
Upon application to us, we will inform you as to the states in which we
believe the Common Stock has been qualified for sale under, or are exempt from
the requirements of, the respective blue sky laws of such states, but we assume
no responsibility or obligation as to your rights to sell Common Stock in any
state.
Additional copies of the Prospectus and any supplements thereto will be
supplied in reasonable quantities upon request.
Any notice from us to you shall be deemed to have been duly given if
mailed, telephoned, or telegraphed to you at the address to which this Agreement
is mailed.
This Agreement shall be construed in accordance with the laws of the State
of Ohio.
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Please confirm your agreement hereto by signing and returning the
confirmations accompanying this letter at once to us as Xxxxxxx Xxxx & Company,
000 Xxxxxxxxx, Xxxxxx, Xxxx 00000. The enclosed duplicate company will evidence
the agreement between us.
XXXXX, XXXXXXXX & XXXXX, INC.
By XXXXXXX XXXX & COMPANY,
A Division Thereof
By:
------------------------------
Xxxxxxxx X. XxXxxxx
Executive Vice President
CONFIRMED AS OF:
____________________________, 1997
(Name of Dealer)
By:
------------------------------
Its:
------------------------------
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