UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington D.C. 20549
SCHEDULE 14A
(Rule 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
(Amendment No. )
Filed by the Registrant [X] Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[X] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material pursuant to ss.240.14a-12
FIRST FEDERAL BANKSHARES, INC.
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(Name of Registrant as Specified in its Charter)
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[ ] No fee required.
[X] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
1. Title of each class of securities to which transaction applies:
Common stock, par value $0.01 per share
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2. Aggregate number of securities to which transaction applies:
3,304,471
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3. Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
$0.1513
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4. Proposed maximum aggregate value of transaction:
$250,000
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5. Total fee paid:
$50.00
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[ ] Fee paid previously with preliminary materials:
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[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1. Amount Previously Paid:
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2. Form, Schedule or Registration Statement No.:
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3. Filing Party:
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4. Date Filed:
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PRELIMINARY COPY
FIRST FEDERAL BANKSHARES, INC.
329 Pierce Street
Sioux City, Iowa 51102
NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD DECEMBER 18, 2009
November 16, 2009
To Our Stockholders:
A special meeting of stockholders (the "Meeting") of First Federal
Bankshares, Inc. (the "Company") will be held on Friday, December 18, 2009. The
Meeting will be held at 12:00 noon, Central Time, at 801 Fourth Street, Sioux
City, Iowa 51102.
At the Meeting, stockholders will be asked:
1. To approve a plan of dissolution and liquidation (the "Plan of
Dissolution") approved and recommended by the Board of Directors,
pursuant to which the Company will be voluntarily dissolved, its
liabilities provided for, its affairs wound up and any remaining
assets distributed to stockholders.
Your proxy to vote at the Meeting is being solicited on behalf of the Board
of Directors. Record holders of our common shares at the close of business on
November 12, 2009 may vote at the Meeting. The attached proxy statement is being
mailed on or about November 17, 2009 to holders of the Company's common stock.
Whether or not you plan to attend the Meeting in person, your vote is
important. In order to maximize the economic benefits to stockholders as
discussed in the accompanying proxy statement, the Plan of Dissolution must be
approved by the stockholders. Failure to return the enclosed proxy card or to
vote in person at the Meeting will have the same effect as a vote against
approval of the Plan of Dissolution. If we do not receive the approval of the
majority of the outstanding shares of our common stock, we will not be able to
dissolve the Company, and will continue to incur operating expenses instead of
distributing those assets to the stockholders. The Board of Directors has
carefully considered this proposal and believes that approval is in the best
interest of the Company and the stockholders. Accordingly, the Board of
Directors recommends that you vote FOR this proposal.
Please read the enclosed proxy statement and accompanying materials and
vote your shares by signing and dating the proxy card and mailing it promptly in
the enclosed postage prepaid envelope. This will ensure that your shares are
represented at the Meeting. Of course, you are also welcome to attend the
Meeting and vote your shares in person, even if you have previously returned
your proxy card.
By Order of the Board of Directors
Barry E. Backhaus
President, Chairman of the Board and
Chief Executive Officer
First Federal Bankshares, Inc.
FIRST FEDERAL BANKSHARES, INC.
329 Pierce Street
Sioux City, Iowa 51102
(712) 277-0200
NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
To be Held on December 18, 2009
Notice is hereby given that a Special Meeting of Stockholders (the
"Meeting") of First Federal Bankshares, Inc. (the "Company") will be held at 801
Fourth Street, Sioux City, Iowa at12:00 noon, Central Time, on Friday, December
18, 2009.
A Proxy Card and a Proxy Statement for the Meeting are enclosed.
The Meeting is for the purpose of considering and acting upon:
1. the approval of a plan of dissolution and liquidation (the "Plan of
Dissolution"), pursuant to which the Company will be voluntarily
dissolved, its liabilities provided for, its affairs wound up and any
remaining assets distributed to stockholders;
and such other matters as may properly come before the Meeting, or any
adjournments thereof. The Board of Directors is not aware of any other business
to come before the Meeting. You may also be asked to take action on other
matters that may be brought before the Meeting by the Board of Directors. In
accordance with our Bylaws, matters that are not specified in this Notice of
Special Meeting cannot be brought before the Meeting unless they are brought
before the Meeting by the Board of Directors. The Board of Directors does not
intend to bring any additional matters before the Meeting as of this date.
Any action may be taken on the foregoing proposal at the Meeting on the
date specified above, or on any date or dates to which the Meeting may be
adjourned. Stockholders of record at the close of business on November 12, 2009
(the "Record Date") are the stockholders entitled to vote at the Meeting and any
adjournments thereof. A list of stockholders entitled to vote at the Meeting
will be available for inspection at the offices of the Corbett Anderson law
firm, 423 Sixth Street, Suite 400, the Security National Bank Building, Sioux
City, Iowa for a period of ten days prior to the Meeting and will also be
available for inspection at the Meeting.
You are requested to complete and sign the enclosed form of proxy, which is
solicited on behalf of the Board of Directors, and to mail it promptly in the
enclosed envelope. The proxy will not be used if you attend and vote at the
Meeting in person.
BY ORDER OF THE BOARD OF DIRECTORS
Jon G. Cleghorn
Secretary
Sioux City, Iowa
November 16, 2009
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IMPORTANT: THE PROMPT RETURN OF PROXIES WILL SAVE THE COMPANY THE EXPENSE OF
FURTHER REQUESTS FOR PROXIES TO ENSURE A QUORUM AT THE MEETING. A SELF-ADDRESSED
ENVELOPE IS ENCLOSED FOR YOUR CONVENIENCE. NO POSTAGE IS REQUIRED IF MAILED
WITHIN THE UNITED STATES.
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PRELIMINARY COPY
PROXY STATEMENT
First Federal Bankshares, Inc.
529 Pierce Street
Sioux City, Iowa 51101
(712) 277-0200
SPECIAL MEETING OF STOCKHOLDERS
To be held on December 18, 2009, 12:00 noon
This proxy statement is furnished in connection with the solicitation on
behalf of the Board of Directors of First Federal Bankshares, Inc. (the
"Company") of proxies to be used at the special meeting of stockholders of the
Company (the "Meeting"), which will be held at 801 Fourth Street, Sioux City,
Iowa on Friday, December 18, 2009 at 12:00 noon Central Time. The accompanying
Notice of Special Meeting and this proxy statement are first being mailed to
stockholders of the Company on or about November 17, 2009.
At the Meeting, stockholders of the Company are being asked to consider and
vote upon the proposal to adopt a plan of dissolution and liquidation adopted by
the Board of Directors (the "Plan of Dissolution"), a copy of which is attached
as Exhibit A to this proxy statement pursuant to which the Company will be
voluntarily dissolved, its liabilities provided for, its affairs wound up and
any remaining assets distributed to stockholders.
RISK FACTORS
In addition to the other information presented in this proxy statement,
stockholders should consider the following risks that relate to the value that
they may derive from the Plan of Dissolution.
There is no assurance as to when the Company's winding up will have progressed
sufficiently to permit distribution of the remaining assets to the Company's
stockholders, or that distribution of all or any part of the remaining assets
will be permissible.
There is no guarantee that the winding up of the Company will not take
longer than anticipated. It may take longer than currently anticipated to
complete the necessary proceedings and unanticipated claims may be raised
against the Company, the resolution of which may delay completion of the
Company's winding up. In addition, it may be necessary for the Company to
utilize some or all of its assets as security for disputed, conditional or
contingent claims while they are being resolved. If there are valid claims
against the Company, it may be necessary for the Company to utilize some or all
of its assets to satisfy these claims. Accordingly, there is no guarantee that
we will be able to distribute all, or any, of the remaining assets to
stockholders as anticipated.
If the Company's assets are distributed to stockholders without payment of or
appropriate provision being made for all the Company's liabilities in connection
with the winding up of its affairs, stockholders could be liable for amounts
distributed to them.
Under Delaware law, if we fail to pay or provide adequately for the
Company's liabilities and obligations in connection with the winding up of the
Company, for a period of three years following the filing by the Company of its
certificate of dissolution, a stockholder of the Company could be held liable to
creditors of the Company for his or her pro rata portion (based on ownership of
common stock as of the record date for the distribution) of any such liability,
limited to the amount previously received by the stockholder in distributions
from the Company under the Plan of Dissolution. If we make a distribution to
you, but have not held back enough cash to satisfy all Company liabilities, you
might have to pay back some or all of the assets you receive. We do not plan to
make any distribution pursuant to the Plan of Dissolution without payment or
adequate provision having been made for all the Company's liabilities.
CAUTIONARY NOTICE REGARDING FORWARD-LOOKING INFORMATION
We caution you that this proxy statement contains statements that contain
"forward-looking" information, indicated by statements not related to historical
facts. These statements are based on our current beliefs as to the outcome and
timing of future events, and actual results may differ materially from those
projected or implied in the forward-looking statements. Further, some
forward-looking statements are based upon assumptions of future events that may
not prove to be accurate. The forward-looking statements involve risks and
uncertainties, including, but not limited to, the risks and uncertainties
referred to below under "Certain Risks," "Information Regarding the Company and
Selected Financial Data" and elsewhere within this proxy statement.
MEETING AND VOTING INFORMATION
Date, Time and Place of the Meeting
The Meeting will be held on Friday, December 18, 2009, at 12:00 noon,
Central Time, at 801 Fourth Street, Sioux City, Iowa.
Matters to be Considered at the Meeting
At the Meeting, stockholders will be asked to consider and vote to approve
the Plan of Dissolution. The Meeting has been called by the Board of Directors
solely for the stockholders to consider and act upon the Plan of Dissolution,
which the Board of Directors has approved and recommended to the stockholders
for their approval. The Board of Directors does not intend to bring any other
matter before the Meeting. Pursuant to the Company's Bylaws, only those matters
that are brought before a special meeting of stockholders by the Board of
Directors may be addressed at the special meeting of stockholders.
Who May Vote
Only holders of the Company's common stock, as recorded in the Company's
share register as of the close of business on November 12, 2009 (the "Record
Date"), may vote at the Meeting. At the close of business on November 12, 2009,
there were 3,304,471 common shares of the Company entitled to vote. Each such
stockholder will be entitled to one vote for each common share held on all
matters to come before the Meeting. Each stockholder may vote in person or by
proxy.
The directors and executive officers of the Company currently own, in the
aggregate, 174,564 shares, or 5.29%, of the outstanding shares of our common
stock, and have options to purchase an additional 19,050 shares, which, if
exercised, would result in the directors and officers owning 5.84% of the
outstanding shares of our common stock. It is unlikely that any directors or
officers will exercise options to purchase additional shares before the Record
Date. See "Security Ownership of Certain Beneficial Owners and Management." We
expect that the directors and executive officers of the Company will vote all of
the shares that they hold in favor of the proposal.
Quorum and Required Vote
The presence at the Meeting (in person or by proxy) of a majority of the
common shares outstanding will constitute a quorum for conducting business.
Under Delaware law, the affirmative vote of a majority of the outstanding common
shares entitled to cast a vote is required to approve the Plan of Dissolution.
Accordingly, we must receive the affirmative vote of the holders of at least
1,652,236 shares in order to approve the Plan of Dissolution. The Board of
Directors recommends a vote FOR approval of the Plan of Dissolution.
You can abstain from voting by marking the "abstain" box on your proxy card
or, if you choose to attend and vote at the Meeting, on the ballot at the
Meeting. Proxies marked as abstaining and proxies containing "broker non-votes"
will be counted as present for purposes of establishing a quorum. "Broker
non-votes" occur when a broker returns a proxy on behalf of customers but does
not cast a vote on matters for which the broker has received no direction from
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its customers. Abstentions and broker non-votes are not counted "for" or
"against" a particular matter. Because we are required to obtain the affirmative
vote of a majority of the outstanding shares entitled to vote on the Plan of
Dissolution, abstentions and broker non-votes have the same effect as a vote
"against" the Plan of Dissolution.
How to Vote
You can provide your voting instructions before the Meeting by mail by
completing, signing and promptly returning your proxy card in the enclosed
postage prepaid envelope. If you hold shares in "street name" through a broker
or bank, you will receive materials regarding this proxy statement from your
broker or bank. You must instruct your broker or bank to vote your shares.
Please carefully follow the directions on your proxy card that you received with
this proxy statement and any instructions that you receive from your broker or
bank.
Alternatively, you may vote in person if you attend the Meeting, even if
you have previously mailed your proxy card.
Revocation of a Proxy
Any stockholder who votes by proxy may revoke the proxy at any time before
it is formally voted at the Meeting. You can revoke a proxy by:
o giving written notice of revocation to First Federal Bankshares, Inc.
c/o Corbett, Anderson, Corbett, Vellinga & Irvin, L.L.P., 423 Sixth
Street, Suite 400, the Security National Bank Building, Sioux City,
Iowa 51102, Attention: Secretary;
o executing and returning a proxy card bearing a later date; or
o attending the Meeting and voting in person.
Attendance at the Meeting, by itself, will not revoke any proxy you
previously granted.
Persons Making the Solicitation and Solicitation Costs
The Company will bear the costs of solicitation of proxies for the Meeting.
The Company has engaged Laurel Hill Advisory Group, LLC to act as solicitation
agent in connection with the proxy statement. The Company will pay Laurel Hill
Advisory Group, LLC a fee of $6,500 for serving as the solicitation agent. In
addition, directors and officers of the Company may solicit proxies from
stockholders of the Company by telephone, telegram, e-mail, personal interview
or otherwise. These directors and officers will not receive additional
compensation, but may be reimbursed for out-of-pocket expenses in connection
with this solicitation. We will reimburse brokers, banks, nominees, fiduciaries
and other custodians for expenses incurred in mailing the proxy statement to the
beneficial owners of common shares held of record by them.
This proxy statement and the accompanying proxy card are first being mailed
on or about November 17, 2009 to holders of the common shares of the Company.
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PROPOSAL 1
APPROVAL OF THE PLAN OF DISSOLUTION AND LIQUIDATION
The following is a summary description of the material aspects of the Plan
of Dissolution. This summary may not contain all the information that is
important to you and should be read in conjunction with the Plan of Dissolution,
which is attached as Exhibit A to this proxy statement. The Plan of Dissolution
contemplates a distribution of the Company's remaining assets to the
stockholders, to the extent permitted by law, upon completion of the winding up
of the Company, and the complete cancellation of the stockholders' interests in
the Company. In considering your vote on the Plan of Dissolution, you should
read this entire proxy statement and the Plan of Dissolution.
Overview of the Plan of Dissolution
At the Meeting, stockholders will be asked to approve the Plan of
Dissolution adopted by our Board of Directors, a copy of which is attached as
Exhibit A to this proxy statement. The principal terms of the Plan of
Dissolution provide for:
o the voluntary dissolution of the Company and the winding up of its
business and affairs in accordance with Delaware law; and
o the distribution to the Company's stockholders of the Company's
remaining assets, if any.
On September 29, 2009, the Board of Directors of the Company approved and
adopted the Plan of Dissolution for the Company and directed that such plan be
recommended and submitted to a vote of the stockholders of the Company at a
special meeting. Approval of the holders of a majority of the outstanding shares
of the Company's common stock is required for the Plan of Dissolution to become
effective.
To wind up the Company's affairs, all of its liabilities must be paid or
provided for, certain tax reports and other regulatory filings made and other
administrative actions taken as may be required for regulatory purposes or as
are otherwise required by law. We currently expect that the Company may be able
to sufficiently complete its winding up so that it is able to distribute its
remaining assets to its stockholders in the fourth calendar quarter of 2009 or
the first calendar quarter of 2010. The Company may make more than one
distribution to stockholders during the winding up process. However, there is no
assurance that claims will not be asserted against the Company or that other
delays will not occur in the course of the winding up process that will require
additional time to resolve and delay the intended distribution to the Company's
stockholders.
Background and Reasons for the Plan of Dissolution
The Company was previously the holding company for Vantus Bank, a federally
chartered stock savings bank (the "Bank"). The Bank was the Company's principal
operating subsidiary, and the Company did not conduct significant operations
other than owning and managing the Bank.
During the first and second calendar quarters of 2009, Moody's Investors
Service and Fitch Ratings downgraded all of the Company's fourteen trust
preferred CDO securities to "speculative grade." As a result, the Company was
required to apply a higher risk weighing formula to these securities when
calculating its regulatory capital ratios, and the Company's capital ratios fell
below the threshold for "adequately capitalized" institutions.
On May 10, 2009, the Bank's primary federal regulator, the Office of Thrift
Supervision (the "OTS") notified the Bank that the Bank was required to increase
its capital, imposed a number of restrictions on the Bank's activities, and
required the Bank to submit a plan to the OTS by June 15, 2009 that would
restore the Bank to adequately capitalized status by September 30, 2009.
On July 31, 2009, the Company and the Bank consented to separate
Stipulations and Consents to Issuance of Order to Cease and Desist (the "Cease
and Desist Orders"). The Cease and Desist Orders imposed additional restrictions
on the operations of the Company and the Bank, required the Company to submit a
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business plan that would result in the Bank achieving a Tier 1 capital ration of
8.0% and a total risk-based capital ratio of 12.0%, as well as other business
and financial objectives.
On August 14, 2009, the OTS notified the Bank that the capital restoration
plan that it provided in response to the May 10, 2009 OTS letter was
unacceptable, and that the OTS intended to issue a Prompt Corrective Action
Directive (the "Directive") to the Bank. On August 31, 2009, the Bank entered
into a Stipulation and Consent to the Directive, which included the Bank's
consent to the OTS's appointment of a receiver.
On September 4, 2009, the Bank was closed by the OTS, and the Federal
Deposit Insurance Corporation (the "FDIC") was appointed as receiver of the
Bank. Subsequently, Great Southern Bank, Springfield, Missouri, assumed all of
the deposits of the Bank and purchased approximately $387 million of the Bank's
assets in a transaction facilitated by the FDIC. The Company did not receive any
proceeds from the transaction with Great Southern Bank.
On September 8, 2009, the Company received a NASDAQ Staff Determination
Letter notifying the Company that, as a result of concerns about the Company's
ability to remain compliant with the requirements for continued listing on The
Nasdaq Stock Market, the NASDAQ staff had made a determination to delist the
Company's common stock from The Nasdaq Stock Market. The Company did not appeal
the determination, and on September 17, 2009, trading in the Company's common
stock on The Nasdaq Stock Market was suspended. On October 6, 2009, NASDAQ filed
with the SEC a Form 25-NSE, which removed the Company's common stock from
listing and registration on The Nasdaq Stock Market.
In the absence of the Bank, the Company's assets consist solely of
approximately $225,000 in cash. The Company is funding its current expenses out
of available cash assets. The Company does not have sufficient resources to
acquire another financial institution, and does not intend to engage in any
other operations. In addition, because it no longer owns and operates a
depository institution, the Company believes it is unlikely that it will be a
desirable acquisition target. Accordingly, the Company does not consider
continuing in existence to be a sensible business plan. Given the Company's
limited assets, it is unlikely that the Company would be able to continue to
function as an economically viable enterprise for the benefit of its
stockholders. In particular, the costs of administering the Company's affairs as
a publicly owned enterprise are prohibitive, and seeking other business
opportunities is not a viable alternative given the Company's limited assets.
The costs associated with continued operations or exploring other business
opportunities would likely erode any remaining potential value to stockholders.
If stockholders do not approve the Plan of Dissolution, the Board of
Directors will re-evaluate the prospects of the Company, and whether there is
any other prudent course of action. This may result in again soliciting
stockholder approval of the dissolution of the Company, which may be on
substantially the same basis as the Plan of Dissolution or on another basis, or
seeking reorganization or liquidation of the Company under the U.S. Bankruptcy
Code or by a similar legal process. Any costs associated with any such
alternative plan and the related solicitation of stockholder approval would
further reduce the assets of the Company available for distribution to the
stockholders.
Winding up of the Company
In accordance with Delaware law (assuming that the stockholders approve the
Plan of Dissolution), the Company's business and affairs will be wound up under
the direction of the Board of Directors. We expect that a limited number of the
directors and officers will continue to serve for a period of time after the
approval of the Plan of Dissolution. Depending on the length of time taken to
wind up the affairs of the Company, other individuals (who may be former
officers or directors of the Company) may be elected by the remaining directors
to oversee completion of the winding up. Delaware law also permits the Board of
Directors, any creditor or any stockholder to apply to the Delaware courts at
any time during the winding up proceedings to have such proceedings continued
under the law and the supervision of the court.
In the event the Company's winding up takes materially longer than
anticipated, the Company's Board of Directors may establish a liquidating trust
to administer the remaining tasks involved in winding up the Company's affairs.
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In such event, the remaining assets of the Company would be transferred to the
liquidating trust and the Company's stockholders would become the beneficiaries
of the trust. Beneficial interests in the trust likely would not be transferable
(except by operation of law).
No federal or state regulatory approvals are required in order for the
Company to effectuate the Plan of Dissolution, other than compliance with the
applicable laws of Delaware governing the winding up of corporations, with which
the Company expects to be able to comply in the ordinary course.
We presently believe that the Company has no material liabilities. Barring
unforeseen events, we anticipate that we will be able to complete the Company's
winding up and make a distribution to stockholders as soon as the fourth
calendar quarter of 2009 or the first calendar quarter of 2010. However, there
is no assurance that the winding up of the Company will not take longer than
anticipated. It may take longer than currently anticipated to complete the
necessary proceedings and unanticipated claims may be raised against the
Company, the resolution of which may delay completion of the Company's winding
up. It may also be necessary for the Company to use its assets as security for
asserted claims. In addition, if there are valid claims against the Company, it
may be necessary for the Company to satisfy these claims out of its assets.
Accordingly, there is no assurance that we will be able to distribute all, or
any, of the assets to stockholders as anticipated.
Assets to be Distributed
Since September 30, 2009, Company has incurred significant expenses in
connection with the winding up of its affairs, including accounting, legal, SEC
filing, printing, proxy solicitation, premiums for insurance to satisfy the
Company's indemnification obligation, and continued operating expenses. As of
the date of this proxy statement, the Company's assets consist solely of
approximately $225,000 in cash. After incurring additional expenses in
connection with its winding up and making appropriate reserves for expenses and
claims, the Company expects to have approximately $175,000 in cash. When we are
in a position to make a distribution to stockholders, stockholders will be
provided information regarding the manner in which the distribution is to be
made and if it will be required for stockholders to surrender their share
certificates to the Company. Stockholders should not send their share
certificates to the Company at this time. The Company may make more than one
distribution to stockholders.
The Company's remaining assets may only be distributed to the Company's
stockholders if all liabilities of and claims against the Company have been paid
or provided for. The Company is required under Delaware law and the Plan of
Dissolution to pay or provide for:
o all claims, including contingent, conditional or unmatured contractual
claims known to the Company;
o any claims against the Company that is the subject of a pending
action, suit or proceeding; and
o claims that, based upon facts known to the Company, are likely to
arise or to become known to the Company within 10 years after the
dissolution.
The Company does not know of any contractual claims. The Company is not
subject to any pending action, suit or proceeding, and the Company does not
believe that there are any claims that are likely to arise within 10 years.
However, there can be no assurance that the Company will not become subject to
such an action, suit or proceeding prior to the completion of the winding up.
There is no assurance as to when the Company's winding up will have
progressed sufficiently to permit distribution of the remaining assets to the
Company's stockholders or that distribution of all, or any, of such assets will
be permissible.
Indemnification of Directors and Officers of the Company
Under the Company's certificate of incorporation and bylaws, the Company is
obligated to indemnify its directors and officers against liabilities and
expenses incurred by them in connection with their service to the Company,
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including with respect to the dissolution of the Company and the winding up of
its affairs, and to advance expenses incurred in responding to claims of such
liability, subject to certain very limited exceptions. The Company's dissolution
will not terminate these indemnification obligations, and indemnification claims
could be asserted against the Company in the course of the Company's winding up
in the same manner as other claims may be asserted against the Company, as
discussed above.
In connection with the dissolution, the Company may grant releases to
current or former directors, officers and employees of the Company of any claims
the Company may have against such persons in consideration of such person
releasing the Company from any indemnification obligations the Company has to
such person.
Record Date for Liquidating Distributions
The record date for determining stockholders of record for the purposes of
the distribution of remaining assets pursuant to the Plan of Dissolution will be
the date on which the Company files a certificate of dissolution with the State
of Delaware, which the Company expects will be the day after the Meeting or the
day after any adjournment of the Meeting. The Company intends to instruct its
transfer agent not to process any transactions in the Company's common stock
after 5:00 p.m. on such date. Accordingly, this date will serve as the record
date for any subsequent distributions to stockholders.
No Appraisal or Dissenter's Rights
Pursuant to Delaware law, there are no appraisal, dissenter's or similar
rights available to the Company's stockholders in connection with the
transactions contemplated by the Plan of Dissolution.
Abandonment; Amendment
Notwithstanding stockholder approval of the Plan of Dissolution, the Board
of Directors may abandon the dissolution of the Company and the Plan of
Dissolution at any time prior to filing the certificate of dissolution. The Plan
of Dissolution requires, assuming stockholder approval, that the Company file a
certificate of dissolution with the State of Delaware after the approval of the
Company's stockholders has been received. Upon such filing, in accordance with
Delaware law, the dissolution of the Company will be effective and may no longer
be abandoned.
Neither Delaware law nor the Plan of Dissolution provides for the amendment
of the Plan of Dissolution. Accordingly, the Plan of Dissolution may not be
amended after stockholder approval has been received.
Potential Liability of Stockholders
Under Delaware law, we are required, in connection with the winding up of
the Company, to pay or adequately provide for payment of all of the Company's
liabilities and obligations. If we distribute assets to stockholders without
paying or providing adequately for all the Company's liabilities and
obligations, Delaware law provides that, for a period of three years following
the filing by the Company of a certificate of dissolution, a stockholder could
be held liable to creditors of the Company for its pro rata portion (based on
relative shareholdings) of any such liability, limited to the amount received by
the stockholder in distributions from the Company under the Plan of Dissolution.
If we made a distribution to you, in such circumstances, you may have to pay
back some or all of the distributions made to you. Because we intend to
carefully evaluate, and make adequate provision for, the Company's liabilities
in winding up the Company, we do not anticipate that any distribution will be
made pursuant to the Plan of Dissolution without payment or adequate provision
having been made for all the Company's liabilities.
Recommendation of the Board of Directors
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT YOU VOTE "FOR" THE
APPROVAL OF THE PLAN OF DISSOLUTION.
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INFORMATION REGARDING THE COMPANY AND SELECTED FINANCIAL DATA
The following selected historical financial data is based on the
consolidated financial reports of the Company and the Bank and, accordingly,
reflects the operations of the Bank. Effective September 4, 2009, the Bank was
placed into receivership, certain assets of the Bank were sold, and the Company
no longer owned the Bank. Accordingly, the selected financial data as of
September 30, 2009 reflects only the financial condition and results of
operations of the Company, without the Bank. In addition, the selected financial
data for the periods ended June 30, 2005, June 30, 2006, June 30, 2007, June 30,
2008, June 30, 2009 and September 30, 2009 have been revised to include the Bank
as discontinued operations. Accordingly, the assets, liabilities and income
(loss) of the Bank are set forth under "assets of discontinued operations,"
"liabilities of discontinued operations," and "income (loss) from discontinued
operations," respectively. The selected financial information is not an
indication of the future performance of the Company, or of the assets that may
be available for distribution. We expect that any future financial performance
of the Company, if the Plan of Dissolution is not approved, to be substantially
different from the selected financial information set forth below.
(Dollars in thousands, except per share amounts)
June 30,
----------------------------------------------------
Financial Condition September 30, 2009 2009 2008 2007 2006 2005
- ------------------------------------------------------------------------------------------------------------------------------------
Total assets $609 $492,363 $566,535 $648,459 $617,056 $590,764
Cash and cash equivalents 609 857 833 1,439 3,125 669
Securities available for sale - - - - - 680
Loans receivable, net - - 693 1,767 1,461 1,139
Other assets - 15 55 22 501 2,043
Assets of discontinued operations - 491,491 564,954 645,231 611,969 586,233
Accrued expenses and other liabilities 28 82 - - - -
Accrued taxes payable - - 158 221 115 141
Liabilities of discontinued operations - 501,654 534,385 577,983 548,618 520,328
Stockholders' equity (deficit) 581 (9,373) 31,992 70,255 68,323 70,295
Three months ended
September 30, Years ended June 30,
--------------------------------------------------------------------------
Operations Data 2009 2008 2009 2008 2007 2006 2005
- ------------------------------------------------------------------------------------------------------------------------------------
Total interest income $2 $16 $ 60 $ 128 $217 $166 $171
Total interest expense - - - - - - -
- ------------------------------------------------------------------------------------------------------------------------------------
Net interest income 2 16 60 128 217 166 171
Provision for losses on loans - - - - - - -
- ------------------------------------------------------------------------------------------------------------------------------------
Net interest income after provision for loan losses 2 16 60 128 217 166 171
- ------------------------------------------------------------------------------------------------------------------------------------
Non-interest income:
Gain on sale of investment securities - - - - 203 -
Reversal of losses upon disposition of subsidiary
in excess of investment (1) 10,162 - - - - - -
Other income - - - - 28 74 -
- ------------------------------------------------------------------------------------------------------------------------------------
Total non-interest income 10,162 - - - 28 277 -
- ------------------------------------------------------------------------------------------------------------------------------------
Non-interest expense:
Professional, insurance and regulatory expense 211 6 101 196 243 294 233
Other non-interest expense - 28 730 197 207 233 180
- ------------------------------------------------------------------------------------------------------------------------------------
Total non-interest expense 211 34 831 393 450 527 413
Income (loss) before income taxes and discontinued
operations 9,953 (18) (771) (265) (205) (84) (242)
Income tax expense (benefit) - (6) (138) (90) (107) (32) (94)
- ------------------------------------------------------------------------------------------------------------------------------------
Income (loss) from continuing operations 9,953 (12) (633) (175) (98) (52) (148)
- ------------------------------------------------------------------------------------------------------------------------------------
Income (loss) from discontinued operations,
net of tax - (786) (51,688) (25,184) 3,167 3,384 4,361
- ------------------------------------------------------------------------------------------------------------------------------------
Net income (loss) $9,953 ($798) ($52,321) ($25,359) $3,069 $3,332 $4,213
====================================================================================================================================
Per share information:
Basic earnings (loss) from continuing operations $3.06 ($0.01) ($0.20) ($0.05) ($0.02) ($0.02) ($0.04)
Basic earnings (loss) from discontinued operations 0.00 (0.24) (15.90) (7.77) 0.95 1.01 1.23
- ------------------------------------------------------------------------------------------------------------------------------------
Basic earnings (loss) per share $3.06 ($0.25) ($16.10) ($7.82) $0.93 $0.99 $1.19
====================================================================================================================================
Diluted earnings (loss) from continuing operations $3.06 ($0.01) ($0.20) ($0.05) ($0.02) ($0.01) $0.04
Diluted earnings (loss) from discontinued operations - (0.24) (15.90) (7.77) 0.94 0.99 1.20
- ------------------------------------------------------------------------------------------------------------------------------------
Diluted earnings (loss) per share $3.06 ($0.25) ($16.10) ($7.82) $0.92 $0.98 $1.16
====================================================================================================================================
Cash dividends declared per common share - - - $0.315 $0.415 $0.400 $0.400
====================================================================================================================================
- -------------------------
(1) Non-cash item. The Company recorded equity in losses of the Bank through
June 30, 2009, which was $10,162 higher than the Company's recorded investment
at that date.
8
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table shows the number of the Company's common shares
beneficially owned by each director and executive officer of the Company and
beneficial owner of more than 5% of the Company's common stock, and all of the
Company's directors and executive officers as a group. This ownership
information is as of November 12, 2009, and is determined in accordance with SEC
rules for reporting beneficial ownership of shares.
Shares of Stock
Beneficially Owned at Percent
Name and Address of Beneficial Owner(1) November 12, 2009(2) of Class(3)
------------------------------------ --------------------- -----------
Barry E. Backhaus, President, Chief Executive Officer,
Chairman of the Board and Director(4) 86,568(9) 2.62%
Jon G. Cleghorn, Vice President, Secretary and Director(5) 42,800(10) 1.30%
Arlene T. Curry, Director(6) 8,769(11) *
Allen J. Johnson, Director 12,851(12) *
Ronald A. Jorgensen, Director 6,000(13) *
Charles D. Terlouw, Director 6,400(14) *
David M. Roederer, Director 5,000(15) *
Gary L. Evans, Director 25,676(16) *
Current Directors and Executive Officers as a Group
(8 persons) 194,064(17) 5.84%
Levon L. Mathews(7) 5,000(18) *
Mike Moderski(8) 9,034(19) *
Jeffrey L. Gendell
55 Railroad Avenue 259,694(20) 7.90%
Greenwich, Connecticut 06830
*Less than 1% of outstanding common stock.
- -----------------------------------------
(1) The mailing address for each person, unless otherwise indicated, is 329
Pierce Street, Sioux City, Iowa 51101.
(2) Includes all shares held directly, as well as by spouses and minor
children, in trust and other indirect ownership, over which shares the
listed stockholders effectively exercise sole or share voting or
dispositive power.
(3) Based upon 3,304,471 shares issued and outstanding.
(4) Mr. Backhaus was appointed as President and Chief Executive Officer of the
Company and Chairman of the Board effective September 15, 2009.
(5) Mr. Cleghorn was appointed as Vice President and Secretary of the Company
effective September 15, 2009.
(6) Ms. Curry resigned as Chairman of the Board effective September 15, 2009.
(7) Mr. Mathews resigned as President and Chief Executive Officer of the
Company effective September 25, 2009.
(8) Mr. Moderski resigned as Chief Financial Officer of the Company effective
September 18, 2009.
(9) Includes 3,700 shares subject to options issued under the 1999 Stock Option
Plan that have vested.
(10) Includes 450 shares subject to options issued under the 1999 Stock Option
Plan that have vested.
(11) Includes 5,450 shares subject to options issued under the 1999 Stock Option
Plan that have vested.
(12) Includes 450 shares subject to options issued under the 1999 Stock Option
Plan that have vested.
(13) Includes 650 shares subject to options issued under the 1999 Stock Option
Plan that have vested and 2,350 shares subject to options issued under the
2006 Stock-Based Incentive Plan that have vested or will vest within 60
days.
(14) Includes 3,000 shares subject to options issued under the 2006 Stock-Based
Incentive Plan that have vested or will vest within 60 days.
(15) Includes 3,000 shares subject to options issued under the 2006 Stock-Based
Incentive Plan that have vested or will vest within 60 days
(16) Includes 450 shares subject to options issued under the 1999 Stock Option
Plan that have vested.
(17) Because Messrs. Mathews and Moderski resigned their positions prior to the
date of this proxy statement, the shares of stock that they beneficially
own are not included in this total. If the shares of stock that Messrs.
Mathews and Moderski beneficially own were included, the directors and
officers as a group would beneficially own 208,098 shares, or 6.23% of the
outstanding shares.
(18) All 5,000 shares are subject to options issued under the 2006 Stock-Based
Incentive Compensation Plan that will vest within 60 days.
(19) Includes 4,800 shares subject to options issued under the 1999 Stock Option
Plan that have vested and 3,234 shares subject to options issued under the
2006 Stock-Based Incentive Plan that have vested.
(20) As of June 30, 2008, based upon a Schedule 13F filed with the SEC by
Jeffrey L. Gendell on August 14, 2009.
9
INTERESTED PARTIES AND RELATED PARTY TRANSACTIONS
Other than beneficial ownership interests set forth below under "Security
Ownership of Certain Beneficial Owners and Management," none of the directors or
executive officers has any direct or indirect interest in the Company. In the
course of its business, the Bank regularly extended loans to directors and
officers of the Company. All such loans were purchased by Great Southern Bank in
the transaction facilitated by the FDIC in connection with its receivership of
the Bank. The Company is not aware of any transactions with any directors or
officers, or with their affiliates, that would constitute a related party
transaction.
MATERIAL FEDERAL INCOME TAX CONSEQUENCES
The following discussion summarizes material federal income tax
consequences of the Plan of Dissolution to the Company and our stockholders.
The following summary is based on the Internal Revenue Code of 1986, as
amended, Treasury Regulations promulgated thereunder, judicial decisions and
published administrative rules and pronouncements of the Internal Revenue
Service, all as in effect on the date hereof. Changes in such rules or new
interpretations thereof may have retroactive effect and could significantly
affect the federal income tax consequences described below.
The Company has not requested an opinion of counsel or a ruling from the
Internal Revenue Service with respect to any of the tax aspects of the Plan of
Dissolution. In addition, this summary does not discuss foreign, state or local
tax consequences of the Plan of Dissolution, nor does it purport to address the
federal income tax consequences of the Plan of Dissolution to special classes of
taxpayers (such as foreign taxpayers, broker-dealers, banks, mutual funds,
insurance companies, financial institutions, small business investment
companies, regulated investment companies, real estate investment trusts,
tax-exempt organizations, investors in pass-through entities, persons whose
functional currency is not the U.S. dollar or who hold common shares of the
Company as part of a position in a straddle or as part of a hedging or
conversion transaction and persons who acquired common shares of the Company on
an exercise of employee stock options or rights or otherwise as compensation or
who hold employee stock options or rights to acquire common shares of the
Company).
Consequences to the Company
Because the assets to be distributed by the Company to the stockholders
will consist solely of cash, the Company will not recognize gain or loss on the
distribution.
Consequences to Stockholders of the Company
In general, a stockholder of the Company will recognize gain or loss on its
receipt of cash in an amount equal to the difference between the amount of cash
received and the stockholder's aggregate tax basis in its shares in the Company.
Any gain or loss recognized by a stockholder generally will be eligible for
capital gain or loss treatment, assuming the shares are held as a capital asset.
Any capital gain or loss recognized will be long-term capital gain or loss if
the shares giving rise to the recognized gain or loss have been held for more
than one year; otherwise, the capital gain or loss will be short-term.
A non-corporate stockholder's long-term capital gain generally is subject
to federal income tax at a maximum rate of 15%, while any capital loss can be
offset only against other capital gains plus $3,000 ($1,500 in the case of a
married individual filing a separate return) of ordinary income in any tax year.
Any unutilized capital loss of a non-corporate stockholder may generally be
carried forward as a capital loss to succeeding tax years for an unlimited time
until the loss is exhausted. A corporate stockholder's capital gain is subject
to federal income tax at a maximum rate of 35%, while any capital loss can be
offset only against other capital gains. Any unused capital loss of a corporate
stockholder generally can be carried back three years and carried forward five
years to be offset against net capital gains generated in those years.
10
If a stockholder has failed to furnish a correct taxpayer identification
number or has failed to clarify that he or she has provided a correct taxpayer
identification number and that he or she is not subject to "backup withholding,"
the stockholder may be subject to a 28% backup withholding tax with respect to
any liquidating distribution. An individual's taxpayer identification number is
his or her social security number. Certain stockholders specified in the
Internal Revenue Code may be exempt from backup withholding. The backup
withholding tax is not an additional tax and may be credited against a
taxpayer's federal income tax liability.
Stockholders are urged to consult their tax advisors concerning the
federal, state, local and other tax consequences applicable to them under the
Plan of Dissolution in light of their particular circumstances.
LISTING AND TRADING OF COMMON STOCK
The shares of common stock of the Company are now quoted on the OTC
(over-the-counter) Bulletin Board ("OTCBB") and on the "Pink Sheets" with ticker
symbol FFSX. The OTCBB is a regulated quotation service that displays quotes,
last sale prices, and volume information in OTC equity securities. Information
about the OTCBB may be found on the Internet at www.otcbb.com. Pink Sheets is a
source of market maker quotations, historical prices and corporate information
about over-the-counter issues and issuers. Information about the Pink Sheets can
be found at www.pinksheets.com. Stocks trading on the OTCBB or the Pink Sheets
are not "listed" or sponsored by the issuers.
If the Plan of Dissolution is approved, the Company plans to close its
stock transfer books as of 5:00 p.m. on the date on which the Company files a
certificate of dissolution with the State of Delaware, which the Company expects
will be the day after the Meeting, or the day after any adjournment of the
Meeting. The Company may require stockholders to surrender to the Company for
cancellation the certificates representing the common shares of the Company they
hold in order to receive a distribution of the remaining assets of the Company.
Until such time, and so long as the OTCBB or the Pink Sheets continue to provide
a market for the stock, stockholders will be permitted to transfer common shares
in the same manner as they currently may be transferred.
STOCKHOLDER PROPOSALS
Our Bylaws treat annual meetings and special meetings differently with
respect to stockholder proposals.
Special Meetings
Pursuant to our Bylaws, matters that are not specified in a notice of a
special meeting cannot be brought before such special meeting unless they are
brought before the special meeting by the Board of Directors. Accordingly, no
stockholder proposals will be considered at the Meeting.
Annual Meetings
We intend, subject to the approval of the stockholders, to dissolve,
liquidate and wind up the affairs of the Company. Accordingly, if the Plan of
Dissolution is approved, we do not expect to call or hold an annual meeting of
the stockholders of the Company with respect to the Company's fiscal year ended
June 30, 2009.
The Bylaws of the Company provide an advance notice procedure for certain
business, or nominations to the Board of Directors, to be brought before an
annual meeting. In order for a stockholder to properly bring business before an
annual meeting, or to propose a nominee to the Board, the stockholder must give
written notice to the Secretary of the Company not less than ninety (90) days
before the date fixed for such annual meeting; provided, however, that in the
event that less than one hundred (100) days notice or prior public disclosure of
the date of the annual meeting is given or made, notice by the stockholder to be
11
timely must be received not later than the close of business on the tenth day
following the day on which such notice of the date of the annual meeting was
mailed or such public disclosure was made. The notice must include the
stockholder's name, record address, and number of shares owned by the
stockholder, describe briefly the proposed business, the reasons for bringing
the business before the annual meeting, and any material interest of the
stockholder in the proposed business. In the case of nominations to the Board,
certain information regarding the nominee must be provided. Nothing in this
paragraph shall be deemed to require the Company to include in its proxy
statement and proxy relating to an annual meeting any stockholder proposal that
does not meet all of the requirements for inclusion established by the SEC in
effect at the time such proposal is received.
If the Plan of Dissolution is not approved, we expect the next annual
meeting of stockholders to be held on or about January 15, 2010. Accordingly,
because notice of any such annual meeting of stockholders will necessarily be
given less than one hundred (100) days in advance of the date of the annual
meeting, written notice for certain business, or nominations to the Board of
Directors, to be brought before the next Annual Meeting must be given to the
Company no later than 10 days following the date the notice of any such Annual
Meeting was mailed or made public. If notice is received after that date, it
will be considered untimely, and the Company will not be required to present the
matter at the annual meeting.
OTHER MATTERS
You may also be asked to take action on other matters that may be brought
before the Meeting by the Board of Directors, although we do not expect any
other matters to be brought before the Meeting as of this date. However, if any
matters should properly come before the annual meeting, it is intended that
holders of the proxies will act as directed by a majority of the Board of
Directors.
BY ORDER OF THE BOARD OF DIRECTORS
Jon G. Cleghorn
Secretary
Sioux City, Iowa
November 16, 2009
12
REVOCABLE PROXY
FIRST FEDERAL BANKSHARES, INC.
SPECIAL MEETING OF STOCKHOLDERS
December 18, 2009
The undersigned hereby appoints Barry E. Backhaus and Jon G. Cleghorn, and
each of them, with full powers of substitution to act as attorneys and proxies
(the "Proxies") for the undersigned to vote all shares of Common Stock of the
Company that the undersigned is entitled to vote at the Special Meeting of
Stockholders (the "Meeting") to be held at 801 Fourth Street, Sioux City, Iowa,
at 12:00 noon, Central Time, on Friday, December 18, 2009. The Proxies are, and
each of them is, authorized to cast all votes to which the undersigned is
entitled as follows:
VOTE
FOR AGAINST ABSTAIN
----- --------- ---------
1. The adoption of the Plan of [ ] [ ] [ ]
Dissolution, pursuant to which the
Company will be voluntarily
dissolved, its liabilities provided
for, its affairs wound up and any
remaining assets distributed to
stockholders.
The Board of Directors recommends a vote "FOR" Proposal 1.
- --------------------------------------------------------------------------------
THIS PROXY WILL BE VOTED AS DIRECTED, BUT IF NO INSTRUCTIONS ARE SPECIFIED, THIS
PROXY WILL BE VOTED FOR PROPOSAL 1. IF ANY OTHER BUSINESS IS PROPERLY PRESENTED
AT SUCH MEETING, THIS PROXY WILL BE VOTED BY THE MAJORITY OF THE BOARD OF
DIRECTORS. AT THE PRESENT TIME, THE BOARD OF DIRECTORS KNOWS OF NO OTHER
BUSINESS TO BE PRESENTED AT THE MEETING.
- --------------------------------------------------------------------------------
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS
Should the undersigned be present and elect to vote at the Meeting or at
any adjournment thereof and after notification to the Secretary of the Company
at the Meeting of the stockholder's decision to terminate this proxy, then the
power of said attorneys and proxies shall be deemed terminated and of no further
force and effect. This proxy may also be revoked by sending written notice to
the Secretary of the Company at the address set forth on the Notice of Special
Meeting of Stockholders, or by the filing of a later dated proxy prior to a vote
being taken on a particular proposal at the Meeting.
The undersigned acknowledges receipt from the Company prior to the
execution of this proxy of notice of the Meeting and a proxy statement dated
November 16, 2009.
Dated: [ ] Check Box if You Plan to Attend
------------------------- the Special Meeting
- ------------------------------- -----------------------------------
Print name of Stockholder Print name of Stockholder
- ------------------------------- -----------------------------------
Signature of Stockholder Signature of Stockholder
Please sign exactly as your name appears on this card. When signing as attorney,
executor, administrator, trustee or guardian, please give your full title. If
shares are held jointly, each holder should sign.
- --------------------------------------------------------------------------------
Please complete and date this proxy and return it promptly
in the enclosed postage-prepaid envelope.
- --------------------------------------------------------------------------------
EXHIBIT A
---------
PLAN OF DISSOLUTION AND LIQUIDATION
PLAN OF DISSOLUTION AND LIQUIDATION
OF
FIRST FEDERAL BANKSHARES, INC.
The Board of Directors of First Federal Bankshares, Inc., a Delaware
Corporation (the "Corporation") has unanimously adopted this Plan of Dissolution
and Liquidation (the "Plan"). This Plan is for the purpose of effecting the
dissolution of the Corporation, and the distribution of its remaining assets, in
accordance with Title 8, Chapter 1, Subchapter X of the Delaware General
Corporation Law, as follows:
1. Approval.
--------
The Plan is subject to, and shall become effective upon, the approval of
the Corporation's stockholders. The Board of Directors shall call a special
meeting of the stockholders, at which meeting the Plan will be submitted to a
vote of the stockholders (the "Special Meeting"). The Plan must be approved by
stockholders holding more than 50% of the shares of the Corporation's common
stock. The approval must occur at a meeting where a quorum of stockholders
holding more than 50% of the Corporation's common stock are present in person or
by proxy.
The Board of Directors shall prepare or cause to be prepared and submitted
to the stockholders, not less than ten (10) nor more than sixty (60) days prior
to the date of the Special Meeting, a proxy statement containing all information
required by applicable law and such other information as the Board of Directors
shall determine is necessary or appropriate for the stockholders to make an
informed decision regarding the dissolution of the Corporation.
2. Payment of or Reserve Against Liabilities.
-----------------------------------------
The Corporation shall:
(a) pay or make reasonable provision to pay all claims and obligations,
including all contingent, conditional or unmatured contractual claims
known to the Corporation, including without limitation federal and
state income taxes and state franchise taxes;
(b) make such provision as will be reasonably likely to be sufficient to
provide compensation for any claim against the Corporation which is
the subject of a pending action, suit or proceeding to which the
Corporation is a party; and
(c) make such provision as will be reasonably likely to be sufficient to
provide compensation for claims that have not been made known to the
Corporation or that have not arisen but that, based on facts known to
the Corporation, are likely to arise or to become known to the
Corporation within ten years after the date of dissolution. Such
claims shall be paid in full and any such provision for payment made
shall be made in full if there are sufficient funds. If there are
1
insufficient funds, such claims and obligations shall be paid or
provided for according to their priority and, among claims of equal
priority, ratably to the extent of funds legally available therefor.
3. Filings.
-------
The officers of the Corporation shall prepare or cause to be prepared,
execute and file:
(a) a Certificate of Dissolution with the Secretary of State of Delaware
in accordance with the provisions of Section 275(d) of the Delaware
General Corporation Law;
(b) with the Securities and Exchange Commission a preliminary proxy
statement, if necessary, and a definitive proxy statement on Schedule
14A;
(c) with the Securities and Exchange Commission, a post-effective
amendment to the current registration statement on Form S-8, which
amendment shall terminate the registration of any shares registered by
such registration statement that remain unsold;
(d) with the Securities and Exchange Commission, a Form 15 terminating the
registration of the Corporation's securities under Section 15(d) of
the Securities Exchange Act of 1934;
(e) with the appropriate taxing agencies, the final tax returns of the
Corporation; and (f) all other returns, documents and information
required to be filed by reason of the dissolution of the Corporation.
The officers of the Corporation shall cause the Corporation to pay all fees
incurred in connection with the filings required in connection with the
dissolution of the Corporation.
4. Distribution of Assets.
----------------------
Any funds remaining after the payment and provisions required by Section 2
are made and all fees and expenses related to the dissolution of the Corporation
are paid shall be distributed to the Corporation's stockholders.
5. Miscellaneous.
-------------
The officers of the Corporation shall carry out and consummate the Plan and
may adopt all resolutions, execute all documents, file all papers and take any
and all other actions they deem necessary or desirable for the purpose of
effecting the dissolution of the Corporation, the winding up of its business and
affairs and the distribution of its assets.
2