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EXHIBIT 1.2
PEOPLES FINANCIAL CORPORATION
1,495,000 Shares
COMMON SHARES
(No Par Value)
Subscription Price $10.00 Per Share
AGENCY AGREEMENT
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May ___, 1996
Trident Securities, Inc.
4601 Six Forks Road, 4th Floor
Raleigh, North Carolina 27609
McDonald & Company Securities, Inc.
2100 Society Building
800 Superior Avenue
Cleveland, Ohio 44114-2603
Ladies and Gentlemen:
Peoples Financial Corporation, an Ohio corporation (the "Company"),
and Peoples Federal Savings and Loan Association of Massillon, Massillon, Ohio,
a federally chartered mutual savings and loan association, the deposit accounts
of which are insured by the Savings Association insurance Fund ("SAIF")
administered by the Federal Deposit Insurance Corporation ("FDIC"), hereby
confirm their agreement with Trident Securities, Inc. ("Trident"), and McDonald
& Company Securities, Inc. ("McDonald"), as follows:
Peoples Federal Savings and Loan Association, in accordance with its
Plan of Conversion adopted by its Board of Directors, including any amendments
thereto (the "Plan"), intends to convert from a mutual savings and loan
association to a stock savings and loan association to be known as Peoples
Federal Savings and Loan Association of Massillon ("Peoples" in its mutual or
stock form, as the sense of the reference indicates), and will issue all of its
issued and outstanding capital stock to the Company. In addition, pursuant to
the Plan, the Company will offer and sell between minimum and super maximum
shares of common stock, no par value per share (the "Shares" or "Common
Stock"), in a subscription offering (the "Subscription Offering") to (1)
depositors of Peoples as of September 30, 1994 ("Eligible Account Holders"),
(2) the Company's employee stock ownership plan (the "ESOP"), (3) eligible
depositors of Peoples as of March 31, 1996 ("Supplemental Eligible Account
Holders") and (4) members of Peoples other than Eligible Account Holders and
Supplemental Eligible Account Holders ("Other Members"). Subject to the prior
subscription rights of the above-listed parties, the Company may offer for sale
in a community offering (the "Community Offering" and when referred to together
with the
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Subscription Offering, the "Offering") conducted subsequent to the Subscription
Offering, the Shares not so subscribed for or ordered in the Subscription
Offering to members of the general public, with a first preference to natural
persons who reside in Stark County, Ohio ("Other Subscribers") (all such
offerees being referred to in the aggregate as "Eligible Offerees"). 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 Peoples may reject, in whole or in part, any orders received in the
Community Offering. Collectively, the transactions described in the foregoing
paragraphs are referred to herein as the "Conversion."
The Company and Peoples desire to retain Trident and McDonald to
assist the Company with its sale of the Shares in the Offering. By and through
this Agency Agreement (the "Agreement"), the Company and Peoples confirm the
retention of Trident and McDonald to advise and assist the Company and Peoples
during the Offering.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a Registration Statement on Form S-1 (File No. 333-_____) (the
"Registration Statement") for the registration of the Shares under the
Securities Act of 1933, as amended (15 U.S.C. Sections 77a-77aa, as amended)
(the "1933 Act"), and has filed such amendments thereto, if any, as may have
been required to the date hereof. The offering prospectus which forms a part of
the Registration Statement, as amended, on file with the Commission at the time
the Registration Statement initially became effective is hereinafter called the
"Offering Prospectus," provided, however, that if any offering prospectus is
filed by the Company pursuant to Rule 424(b) or of the rules and regulations of
the Commission under the 1933 Act (17 C.F.R. Section 230.100 et. seq.) (the
"1933 Act Regulations") and is different from the offering prospectus on file
at the time the Registration Statement initially becomes effective, the term
"Offering Prospectus" shall refer to the offering prospectus filed pursuant to
Rule 424(b) or (c) from and after the time such offering prospectus is filed
with or mailed to the Commission for filing.
In accordance with Title 12, Part 563b of the Code of Federal
Regulations (the "Conversion Regulations"), Peoples has filed with the Office
of Thrift Supervision (the "OTS") an Application for Approval of Conversion on
Form AC (the "Conversion Application"), including the Offering Prospectus, and
has filed such amendments thereto, if any, as may have been required by the
OTS. The Conversion Application has been approved by the OTS and the related
Offering Prospectus has been authorized for use by the OTS. Copies of such
approvals have been supplied to Trident and McDonald and their counsel. In
addition, the Company has filed with the OTS an Application on Form H-(e)1-S
(the "Holding Company Application") to become a registered savings and loan
holding company under the Home Owners' Loan Act, as amended (12 U.S.C. Section
1467a) ("HOLA").
1. REPRESENTATIONS AND WARRANTIES. The Company and Peoples,
jointly and severally, represent and warrant to Trident and McDonald that:
(a) The Company has filed with the Commission the
Registration Statement including exhibits, and an amendment or amendments
hereto. The Registration Statement, as amended, was declared effective by the
Commission on __________, _____. No stop or
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equivalent order has been issued with respect to the Registration Statement and
no proceedings therefor have been initiated or, to the knowledge of Peoples,
threatened by the Commission.
(b) The Registration Statement, including exhibits and
amendments and/or supplements thereto, comply in all material respects with the
1933 Act and the 1933 Act Regulations. The Offering Prospectus has been
declared effective by the Commission and such action is in full force and
effect. No order has been issued by the Commission preventing or suspending the
use of the Offering Prospectus. No action by or for the Commission revoking
such action is pending or, to the knowledge of Peoples, threatened.
(c) The Registration Statement, as amended, 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.
Representations and warranties in this subsection (c) shall not apply to
statements or omissions which relate to Trident or McDonald and which were made
in reliance upon and in conformity with written information furnished to
Peoples by or on behalf of Trident or McDonald expressly for use in the
Offering Prospectus.
(d) Peoples has filed with the OTS the Conversion
Application. The Conversion Application was approved by the OTS on _______,
____. No stop or equivalent order has been issued with respect to the
Conversion Application and to the knowledge of Peoples, no proceedings therefor
have been initiated or threatened by the OTS.
(e) The Conversion Application, including exhibits and
amendments and/or supplements thereto, complies in all material respects with
the Conversion Regulations. The Offering Prospectus, which is included in the
Conversion Application as Item __, has been approved for use by the OTS and
such approval is in full force and effect. No order has been issued by the OTS
preventing or suspending the use of the Offering Prospectus. No action by or
before the OTS revoking such approval is pending or, to the knowledge of
Peoples, threatened.
(f) The Conversion Application, including the Offering
Prospectus, 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 are made,
not misleading. Representations and warranties in this subsection (I) shall not
apply to statements or omissions which relate to Trident or McDonald and which
were made in reliance upon and in conformity with written information furnished
to Peoples by or on behalf of Trident or McDonald expressly for use in the
Offering Prospectus.
(g) The Company has filed with the OTS the Holding Company
Application, and such Application was deemed complete by the OTS. As of the
Closing Date (as hereinafter defined), approval of the Company's acquisition of
Peoples will be obtained from the OTS.
(h) The Company has been duly incorporated and is validly
existing under the laws of the State of Ohio with full power and authority to
own its properties and conduct its business as described in the Registration
Statement and Offering Prospectus. The Articles and
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Regulations of the Company comply in all material respects with applicable
laws. The Company has obtained all licenses, permits and other governmental
authorizations currently required for the conduct of its business, except where
the failure to obtain such licenses, permits or authorizations would not have a
material adverse effect upon the business or operations of the Company. All of
such licenses, permits and other governmental authorizations are in full force
and effect and the Company is in all material respects in compliance therewith.
(i) Peoples is a mutual savings association duly organized
and validly existing under the laws of the United States with full power and
authority to own its properties and conduct its business as described in the
Offering Prospectus. The Charter and Bylaws of Peoples comply in all material
respects with applicable laws. Peoples has obtained all licenses, permits and
other governmental authorizations currently required for the conduct of its
business, except where the failure to obtain such licenses, permits or
authorizations would not have a material adverse effect upon-the business or
operations of Peoples; all of such licenses, permits and other governmental
authorizations are in full force and effect; and Peoples is in all material
respects in compliance therewith. The deposit accounts of Peoples are insured
up to applicable limits by the FDIC. Peoples is a member of the Federal Home
Loan Bank of Cincinnati (the "FHLB of Cincinnati").
(j) Peoples owns of record and beneficially all of the
outstanding shares of capital stock of Massillon Community Service Corporation
("Massillon"). Massillon is a corporation duly organized, validly existing and
in good standing under the laws of the State of Ohio with full power and
authority to own its properties and conduct its business as described in the
Offering Prospectus. The Articles of Incorporation and the Regulations of
Massillon comply in all material respects with the applicable laws of the State
of Ohio. Massillon has obtained all material licenses, permits and other
governmental authorizations currently required for the conduct of its business,
all of which are in full force and effect, and Massillon is in all material
respects complying therewith.
(k) The Plan has been duly and validly adopted by the Board
of Directors of Peoples. Before the Closing Date, the Plan will be duly and
validly approved by the members of Peoples and the offer and sale of the Shares
will have been conducted in all material respects in accordance with the Plan,
the Conversion Regulations and all other applicable laws, regulations,
decisions and orders, including all items, conditions, requirements and
provisions precedent to the Conversion imposed upon the Company or Peoples by
the OTS, the Commission or any other regulatory authority and in the manner
described in the Offering Prospectus. As of the date of this Agreement, to
Peoples' knowledge, no person has sought to obtain review of the final action
of the OTS in approving the Plan or the Conversion Application pursuant to the
Home Owners' Loan Act, as amended, or any other statute or regulation.
(l) Upon the consummation of the Conversion, Peoples will be
a stock savings association duly organized and validly existing under the laws
of the United States with full power and authority to own its properties and
conduct its business as set forth in the Offering Prospectus and will be a
member in good standing of the FHLB of Cincinnati. Upon the consummation of the
Conversion, Peoples will have all of the necessary corporate power and
authority to enter into
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this Agreement, to perform all of its obligations hereunder and to consummate
the transactions contemplated hereby and will have all material licenses,
permits and other governmental authorizations currently required for the
conduct of its business. Upon consummation of the Conversion, the liquidation
account for the benefit of Eligible Account Holders and Supplemental Account
Holders will be duly established in accordance with the requirements of the
Conversion Regulations.
(m) The Company, Peoples and Massillon are duly qualified and
in good standing as foreign corporations in all jurisdictions in which the
conduct of their business requires such qualification or, if not so qualified
and in good standing, failure to so qualify would not have any material adverse
effect on the Company and Peoples taken as a whole.
(n) Except as disclosed in the Offering Prospectus, neither
the Company nor Peoples owns of record or beneficially any equity securities
of, or an equity interest in, any entity or business enterprise, other than, in
the case of the Company, Peoples, and, in the case of Peoples, Massillon.
(o) Each of the Company, Peoples and Massillon has good title
to all assets and liabilities material to their respective businesses and to
those assets described in the Offering Prospectus as owned by the Company,
Peoples or Massillon, free and clear of all material liens, charges,
encumbrances or restrictions, except as set forth in the Offering Prospectus.
All of the leases and subleases material to the business of the Company,
Peoples and Massillon under which any one of them holds properties, including
those set forth in the Offering Prospectus, are in full force and effect as
described therein.
(p) This Agreement has been duly and validly authorized,
executed and delivered by the Company and Peoples. This Agreement constitutes
the valid and legally binding obligation of the Company and Peoples of
enforceable against them in accordance with its terms, except as the
enforceability thereof may be limited by bankruptcy, insolvency, moratorium,
reorganization or similar laws relating to or affecting the enforcement of
creditors' rights generally or the rights of creditors of savings and loan
holding companies, the accounts of whose subsidiaries are insured by the FDIC
or by general equity principles regardless of whether such enforceability is
considered in a proceeding in equity or at law, and except to the extent, if
any, that the provisions of Section 6 and 7 of this Agreement may be
unenforceable as against public policy.
(q) The Conversion will constitute a tax-free reorganization
under the Internal Revenue Code of 1986, as amended, and will not be a taxable
transaction under the laws of Ohio to the Company or Peoples or to persons
receiving subscription rights in accordance with the Plan. The Company and
Peoples have received the opinion of Vorys, Sater, Seymour and Pease, special
counsel to the Company and Peoples, with respect to the federal and Ohio tax
consequences of the Conversion. The facts relied upon by such firm as set forth
in such opinion are accurate and complete as of the date of such opinion.
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(r) The Company and Peoples have all such power, authority,
authorizations, approvals and orders as may be required to enter into this
Agreement, to perform all of their obligations hereunder and to consummate the
transactions contemplated hereby. Without limiting the generality of the
foregoing sentence, on or before the Closing Date, (i) the Company will have
the power, authority, authorizations, approvals and orders to issue and sell
the Shares in accordance with this Agreement and the Offering Prospectus. On or
before the Closing Date, the form of the Stock Charter for Peoples will have
been approved by the OTS.
(s) Neither the Company, Peoples nor Massillon is in
violation of any rule or regulation of the OTS or the FDIC or any other agency
which might materially and adversely affect the condition (financial or
otherwise), operations, businesses, assets or properties of the Company,
Peoples and Massillon taken as a whole. Neither the Company, Peoples nor
Massillon is subject to any directive from the OTS or the FDIC (or their
predecessors) or any other agency to make any change in the method of
conducting its business or affairs. Each of the Company, Peoples and Massillon
has conducted its business in material compliance with all applicable statutes
and regulations (including, without limitation, all regulations, decisions,
directives and orders of the FHLB of Cincinnati, the OTS and the FDIC, or their
predecessors). Except as set forth in the Registration Statement and flee
Offering Prospectus, there is not pending or, to the knowledge of the Company
and Peoples, threatened any litigation, charge, investigation, action, suit or
proceeding before or by any court, regulatory authority or governmental agency
or body which, individually or in the aggregate, might materially affect the
performance of the terms and conditions of this Agreement or the consummation
of the transactions contemplated hereby or which, individually or in the
aggregate, might result in any material adverse change in the condition
(financial or otherwise), business, prospects or results of operations of the
Company, Peoples and Massillon, taken as a whole.
(t) The statements of financial condition as of September 30,
1995 and 1994, of Peoples and the related statements of operations, changes in
retained earnings and cash flows for each of the three years ended September
30, 1995, 1994 and 1993, examined and reported upon by Hall, Kistler & Company
P.L.L., independent certified public accountants, complete copies of which are
included in the Offering Prospectus and the Registration Statement (the
"Audited Financial"), have been prepared in conformity with generally accepted
accounting principles applied on a consistent basis and fairly present the
financial position of Peoples at such dates and the results of its operations,
changes in retained earnings and cash flows for such periods. The statement of
financial condition as of December 31, 1995 (unaudited) and September 30, 1994
and 1995 of Peoples and the related statements of income retained earnings and
cash flows for the years ended September 30, 1993, 1994 and 1995 and the three
months ended December 31, 1994 and 1995 (unaudited), complete copies of which
are included in the Offering Prospectus and the Registration Statement (the
"Interim Financials"), have been prepared in conformity with generally accepted
accounting principles for interim financial statements applied on a consistent
basis and fairly present the financial position of Peoples at such dates and
the results of its operations, changes in retained earnings and cash flows for
such periods. The tabular information in the Offering Prospectus fairly
presents the information purported to be shown thereby at the respective dates
and for the respective periods covered thereby.
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(u) The capitalization, assets, properties and business of
the Company, Peoples and Massillon conform in all material respects to the
descriptions thereof contained in the Offering Prospectus as of the date
specified. Since such date, there has been no material adverse change in either
the condition (financial or otherwise) of the Company, Peoples and Massillon,
taken as a whole, or in the assets, properties, operations, earnings or
business prospects of the Company, Peoples and Massillon, taken as a whole. The
Company, Peoples and Massillon, taken as a whole, have no material contingent
liabilities of any kind, except as set forth in the Offering Prospectus.
(v) No material default exists, and no event has occurred
which, with notice or lapse of time, or both, would constitute a default, on
the part of the Company, Peoples or Massillon or, to their knowledge, on the
part of any other party, in the due performance and observance of any term,
covenant or condition of any agreement which is material to the condition
(financial or otherwise) of the Company, Peoples and Massillon, taken as a
whole. Such agreements are in full force and effect. No other party to any such
agreement has instituted or, to the knowledge of the Company and Peoples,
threatened any action or proceeding wherein the Company, Peoples or Massillon
is alleged to be in default thereunder.
(w) Neither the Company, Peoples and Massillon is in
violation of its respective Articles of Incorporation, Charter, Regulations or
Bylaws or in default in any respect in the performance of any material
obligation, agreement or condition contained in any bond, debenture, note or
any other evidence of indebtedness by which it is bound, except where such
default would not be material to the Company, Peoples and Massillon, taken as a
whole. The execution, delivery and fulfillment of the terms of this Agreement
and the consummation of the transactions contemplated hereby (i) do not and
will not violate or conflict with the respective Articles of Incorporation,
Charter, Regulations or Bylaws of the Company, Peoples or Massillon or their
respective Corporate Regulations or (ii) in any respect, violate, conflict with
or constitute a breach of, or default (or an event which, with notice or lapse
of time, or both, would constitute a default), except where such violation,
conflict, breach or default would not be material to the Company, Peoples and
Massillon, taken as a whole, under (I) any agreement, indenture or other
instrument by which the Company, Peoples or Massillon is bound, or (II) any
governmental license or permit or any law, administrative regulation or
authorization, approval, court decree, injunction or order.
(x) Subsequent to the respective dates as of which
information is given in the Offering Prospectus and before the Closing Date,
neither the Company, Peoples nor Massillon will (i) issue any securities or
incur any liability or obligation, direct or contingent, for borrowed money,
except (I) the shares of Peoples common stock to be issued in the Conversion
and (II) borrowings from the FHLB of Cincinnati and other borrowings in the
ordinary course of business, including, but not limited to, borrowings in the
form of deposits, or (ii) enter into any other transaction not in the ordinary
course of business which is material in light of the businesses and properties
of the Company, Peoples and Massillon, taken as a whole.
(y) No equity securities of Peoples in its mutual form are
outstanding other than deposits accepted in the ordinary course of business. On
the Closing Date, the authorized,
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issued and outstanding equity capital of the Company in its stock form will be
within the range set forth in the Offering Prospectus under the caption
"Capitalization."
(z) When issued in accordance with the terms of the Plan, the
Shares will be validly issued, fully paid and nonassessable, will conform to
the description thereof set forth in the Registration Statement and the
Offering Prospectus and will be issued in compliance in all material respects
with all applicable securities laws. Notwithstanding the foregoing, until
payments are received by the Company from the ESOP in accordance with the terms
of a loan agreement by and between the Company and the ESOP, shares for which
payment in money has not been received will not be fully paid and
non-assessable. The issuance of the Shares is not subject to preemptive rights.
Good title to the Shares will be transferred to the purchasers thereof upon
issuance thereof against payment therefor, free and clear of all claims,
encumbrances, security interests and liens whatsoever, except such claims,
encumbrances, security interests and liens asserted against the purchasers
thereof for debts of such purchasers. The certificates evidencing the Shares
will conform to the requirements of applicable laws and regulations.
(aa) On the Closing Date, the Company and Peoples will have
satisfied all conditions precedent to, and conducted the Conversion in all
material respects in accordance with, the Plan, the Registration Statement, the
Conversion Application, the Offering Prospectus, the Conversion Regulations and
all other applicable laws, regulations, decisions and orders, including all
terms, conditions, requirements and provisions precedent to the consummation of
the transactions contemplated by the Plan, the Registration Statement, the
Conversion Application and the Offering Prospectus and the approval of the (i)
Conversion Application imposed upon them by the OTS and (ii) the Registration
Statement imposed upon them by the Commission.
(bb) Appropriate arrangements for placing the funds received
from subscriptions for Shares in a segregated interest-bearing account with
Peoples until all Shares are paid for (the "Escrow Account") were made before
the commencement of the Offering, with provision (i) for prompt refund to
subscribers if the transactions contemplated by the Plan and the Offering
Prospectus are otherwise not consummated or (ii) for delivery to the Company if
the transactions contemplated by the Plan and the Offering Prospectus are
consummated.
(cc) No approval of any regulatory, supervisory or other
public authority is required in connection with the execution and delivery of
this Agreement or the issuance and sale of the Shares, except the approval of
the OTS and the Commission, the approval of the reasonableness of Trident and
McDonald's compensation by The National Association of Securities Dealers, Inc.
("NASD"), and as may be otherwise required under the securities laws of various
states.
(dd) All contracts and other documents required to be filed
as exhibits to the (i) Conversion Application have been filed with the OTS and
(ii) Registration Statement have been filed with the Commission.
(ee) Hall, Kistler & Company P.L.L., the public accounting
firm which has certified the financial statements of Peoples included in the
Offering Prospectus, are independent
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certified public accountants within the meaning of the Code of Professional
Ethics of the American Institute of Certified Public Accountants and within the
meaning of 12 C.F.R. Section 571 .2(c)(3).
(ff) Each of the Company and Peoples has (i) timely filed all
required federal and state tax returns and no deficiency has been asserted with
respect to such returns by any taxing authorities, (ii) paid all taxes that
have become due and (iii) made adequate reserves for similar future tax
liabilities.
(gg) The records of account holders, depositors, borrowers
and other members of Peoples delivered to Trident and McDonald by Peoples for
use in connection with the Conversion are reliable and accurate in all material
respects.
(hh) Neither the Company nor Peoples has not engaged in any
transaction in connection with which the Company or Peoples could be subject to
either a civil penalty assessed pursuant to Section 502(i) of the Employee
Retirement Income Security Act of 1974, as amended ("ERlSA"), or a tax imposed
by Section 4975 of the Internal Revenue Code of 1986, as amended. No material
liability to the Pension Benefit Guaranty Corporation has been or is expected
by the Company or Peoples to be incurred by the Company or Peoples with respect
to any pension plan subject to ERISA (a "Pension Plan"). There has been no
"reportable event" (within the meaning of Section 4043(b) of ERISA) with
respect to any Pension Plan and no event or condition which presents a material
risk of the termination of any Pension Plan by the Pension Benefit Guaranty
Corporation. Full payment has been made of all amounts which Peoples is
required, under the terms of any Pension Plan, to have paid as contributions to
such Pension Plan as of the date hereof, as no "accumulated funding deficiency"
(as defined in Section 302 of ERISA and Section 412 of the Code), whether or
not waived, exists with respect to any Pension Plan.
(ii) Keller and Company, Inc. (the "Appraiser"), the
corporation which prepared an appraisal of the estimated pro forma fair market
value of Peoples, has advised Peoples that the- Appraiser is independent with
respect to each of them within the meaning of the Conversion Regulations.
(jj) The Company and Peoples are in compliance in all
material respects with 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.
(kk) To the knowledge of the Company and Peoples, neither the
Company, Peoples nor the employees of the Company or Peoples has made any
payment of funds of the Company or Peoples 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.
(ll) The Company and Peoples have not relied upon Trident or
McDonald or its legal counsel or other advisors for any legal, tax or
accounting advise in connection with the Conversion, other than advice with
respect to state securities matters.
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Section 2. RETENTION OF TRIDENT AND MCDONALD: COMPENSATION: SALE AND
DELIVERY OF THE SHARES. Subject to the terms and conditions herein set forth,
the Company and Peoples hereby appoint Trident and McDonald as their financial
advisors and marketing agents to utilize its best efforts to solicit
subscriptions for Shares and to advise and assist the Company and Peoples with
respect to the sale of the Shares in the Offering.
On the basis of the representations, warranties and agreements herein
contained, but subject to the terms and conditions herein set forth, Trident
and McDonald accepts such appointment and agrees to consult with and advise the
Company and Peoples as to the matters set forth in the letter agreement
("Letter Agreement"), dated September 21, 1995, between Peoples and Trident and
McDonald, a copy of which is attached hereto as Exhibit A. It is acknowledged
by the Company and Peoples that Trident and McDonald 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.
The obligations of Trident and McDonald pursuant to this Agreement
shall terminate upon the completion or termination or abandonment of the Plan
by the Company or Peoples or upon termination of the Offering, but in no event
later than 45 days after the completion of the Subscription Offering unless
extended by agreement of all parties (the "End Date"). All fees or expenses due
to Trident and McDonald but unpaid will be payable to Trident and McDonald in
next day funds at the earlier of the Closing Date (as hereinafter defined) or
the End Date.
In the event the Company is unable to sell a minimum of 1,105,000
Shares within the period herein provided, this Agreement shall terminate, and
the Company shall refund to any persons who have subscribed for any of the
Shares, the full amount which it may have received from them, plus accrued
interest as set forth in the Offering Prospectus; and none of the parties to
this Agreement shall have any obligation to the other parties hereunder, except
as set forth in this Section 2 and in Sections 6, 7, 8 and 9 hereof.
In the event the Offering is terminated for any reason not
attributable to the action or inaction of Trident and McDonald, Trident and
McDonald (collectively, the "Parties") shall be paid the expenses due to the
date of such termination pursuant to section (c) below.
If all conditions precedent to the consummation of the Conversion,
including, without limitation, the sale of all Shares required by the Plan to
be sold, are satisfied, the Company agrees to issue or have issued the Shares
sold in the Offering and to release for delivery certificates for such Shares
on the Closing Date (as hereinafter defined) against payment to the Company by
any means authorized by the Plan, provided, however, that no funds shall be
released to the Company until the conditions specified in Section 5 hereof
shall have been complied with to the reasonable satisfaction of Trident and
McDonald. The release of Shares against payment therefor shall be made on a
date and at a place acceptable to the Parties (it being understood that such
date shall not be more than 10 business days after termination of the Offering
unless the Offering is oversubscribed in which case the Parties shall agree on
another time and place that is within a reasonable period of time of the
termination of the Offering) or such other time or place as shall be agreed
upon by the Parties. The date upon which the Company shall release or deliver
the
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Shares sold in the Offering, in accordance with the terms hereof, is herein
called the "Closing Date."
Trident and McDonald shall receive the following compensation for
their services hereunder:
(a) Two percent (2.0%) of the aggregate dollar amount of all Shares
sold in the Subscription Offering, excluding Shares sold to Peoples' ESOP,
directors or executive officers (or "associates of such directors and executive
officers" as defined in the Peoples' Plan of Conversion).
(b) Two and one-half percent (2.5%) of the aggregate dollar amount of
all Shares sold by Trident in the Community Offering.
(c) The foregoing fees and commissions are to be payable to Trident
and McDonald on the Closing Date. No commissions will be payable on any Shares
sold in excess of the Midpoint of the final valuation range as determined by an
independent appraiser.
(d) Trident and McDonald shall be reimbursed for all allocable
expenses, of which $10,000 has been paid, incurred by them, including, but not
limited to, legal fees, travel, communications and postage, whether or not the
Conversion is successfully completed. Reimbursement for such legal fees and
out-of-pocket expenses and legal fees shall not exceed $45,000.
It further is understood that Peoples will pay all other expenses of
the Conversion including but not limited to its attorneys' fees, NASD filing
fees, and filing and registration fees and fees of either Trident's and
McDonald's attorneys or the attorneys relating to any required state securities
law filings, telephone charges, air freight, rental equipment, supplies,
transfer agent charges, fees relating to auditing and accounting and costs of
printing all documents necessary in connection with the foregoing.
Full payment of Trident's and McDonald's actual and accountable
expenses shall be made in next day funds on the Closing Date or, if the
Offering is not completed and is abandoned or terminated for any reason, within
five (5) days of receipt by the Company or Peoples of a reasonable accounting
from Trident and McDonald of their expenses.
In the event of a resolicitation of subscribers, the parties agree to
renegotiate the expense cap on legal fees and out-of-pocket expenses applicable
to Trident and McDonald.
3. Closing.
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(a) The Closing shall take place at a location, at a time and
on a business day which is agreed upon by the parties hereto, but which is not
later than the fifth business day after the date upon which Peoples certifies
to the OTS that orders have been received for the number of Shares to be sold
in the Conversion (herein referred to as the "Closing Date").
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(b) As of the Closing Date, the offer, sale and issuance of the
Shares by the Company will be approved by the OTS and duly and validly
authorized by all necessary action of the Company and Peoples in its mutual and
stock forms.
(c) At the Closing, the Shares will be issued by the Company
against payment of the purchase price therefor by wire transfer in immediately
available funds from the Escrow Account. Certificates evidencing the Shares
shall be prepared in definitive form and in such denominations and registered
in such names as set forth in the Order Forms or, in the case of Shares not
subscribed for pursuant to Order Forms, in such names as Trident and McDonald
(or Selected Dealers, if applicable) may request, upon at least two business
days' prior notice to Peoples and shall be, (i) in the case of Shares
subscribed for pursuant to Order Forms, delivered by Peoples directly to the
purchasers thereof as promptly as practicable following the Closing, and (ii)
in the case of Shares not subscribed for pursuant to Order Forms, made
available for checking and packaging at least one business day before the
Closing at a location to be designated by Trident and McDonald.
(d) On or before the Closing Date, the following will
occur:
(i) The OTS will issue a Stock Charter for Peoples;
(ii) Peoples in the stock form will be duly
organized and validly existing under the laws of the United States, with
full power and authority to own its properties and conduct its business as
described in the Offering Prospectus; and
(iii) The Conversion will be approved by Peoples'
members and the OTS.
4. FURTHER AGREEMENTS. The Company and Peoples covenant and agree
that:
(a) The Company will deliver to Trident and McDonald, from time
to time, such number of copies of the Offering Prospectus as Trident and
McDonald may reasonably request. The Company hereby authorizes and directs
Trident and McDonald to use the Offering Prospectus in connection with the
offer and sale of the Shares.
(b) Peoples will notify Trident and McDonald immediately upon
obtaining knowledge thereof, and confirm the notice in writing: (i) when any
amendment to the Conversion Application is filed with the OTS or when any
supplement to the Offering Prospectus is filed with the OTS; (ii) of the
issuance by the OTS of any stop order relating to the Conversion Application or
the Offering Prospectus or of the initiation or the threat of any proceedings
for such purpose; (iii) of the receipt of any notice with respect to the
suspension of the qualification of the Shares for offering or sale in any
jurisdiction; and (iv) of the receipt of any comments from the OTS relating to
the Conversion Application or the Offering Prospectus. In the event the OTS
enters a stop order relating to the Conversion Application or the Offering
Prospectus at any time, Peoples
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will make every reasonable effort to obtain the lifting of such order at the
earliest possible moment.
(c) The Company will notify Trident and McDonald immediately
upon obtaining knowledge thereof, and confirm the notice in writing: (i) when
any amendment to the Registration Statement is filed with the Commission or
when any supplement to the Offering Prospectus is filed with the Commission;
(ii) of the issuance by the Commission of any stop order relating to the
Registration Statement or the Offering Prospectus or of the initiation or the
threat of any proceedings for such purpose; (iii) of the receipt of any notice
with respect to the suspension of the qualification of the Shares for offering
or sale in any jurisdiction; and (iv) of the receipt of any comments from the
Commission relating to the Registration Statement or the Offering Prospectus.
In the event the Commission enters a stop order relating to the Registration
Statement or the Offering Prospectus at any time, the Company will make every
reasonable effort to obtain the lifting of such order at the earliest possible
moment.
(d) During the time when an Offering Prospectus is required
to be delivered in accordance with the Conversion Regulations, the 1933 Act and
the 1933 Act Regulations, Peoples will comply in all material respects with all
requirements of the Conversion Regulations, the 1933 Act and the 1933 Act
Regulations, as now in effect and as hereafter amended, as from time to time in
force, so far as is necessary to permit the continuance of offers and sales of
or dealings in the Shares in accordance with the provisions hereof and the
Offering Prospectus. If, during the period when the Offering Prospectus is used
in connection with the offer and sale of the Shares, any event relating to or
affecting the Company or Peoples shall occur as a result of which it is
necessary, in the reasonable opinion of counsel for the Company or Peoples and
counsel for Trident and McDonald, to amend or supplement the Offering
Prospectus in order to make the Offering Prospectus not false or misleading in
light of the circumstances existing at the time the Offering Prospectus is
delivered to a purchaser of the Shares, the Company and Peoples shall forthwith
prepare and furnish to Trident and McDonald a reasonable number of copies of an
amendment or amendments or of a supplement or supplements to the Offering
Prospectus (in form and substance reasonably satisfactory to counsel for
Trident and McDonald) which shall amend or supplement the Offering Prospectus
so that, as amended or supplemented, the Offering Prospectus will 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 existing at the time the Offering Prospectus is delivered to a
purchaser of the Shares, not misleading. The Company and Peoples will not file
or use any amendment or supplement to the Conversion Application, the
Registration Statement or the Offering Prospectus of which Trident and McDonald
has not first been furnished a copy or as to which Trident or McDonald shall
reasonably object after having been furnished such copy. For the purpose of
this subsection (d), the Company and Peoples shall furnish such information
with respect to themselves as Trident and McDonald from time to time reasonably
may request.
(e) The Company and Peoples will take all reasonably
necessary action as may be required to qualify or register the Shares for offer
and sale by the Company under the securities or "blue sky" laws of such
jurisdictions as Trident and McDonald and the Company and Peoples may agree
upon; provided, however, that the Company will not be obligated to qualify as a
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foreign corporation under the laws of any such jurisdiction. In each
jurisdiction in which such qualification or registration will be effected, the
Company, unless Trident and McDonald agree that such action is not necessary or
advisable in connection with the distribution of the Shares, will file and make
such statements or reports as are, or reasonably may be, required by the laws
of such jurisdiction.
(f) The Company shall file with the Commission a registration
statement for the Shares under Section 12(g) of the Securities Exchange Act of
1934, as amended (hereinafter referred to as the "Exchange Act"), upon
completion of the Offering and will request that such registration statement
become effective upon the completion of the Conversion and the Company will
maintain the effectiveness of such registration under Section 12(g) of the
Exchange Act for not less than three (3) years.
(g) For a period of three (3) years from the date of this
Agreement, the Company will furnish the following to Trident and McDonald:
(i) As soon as publicly available after the
end of each fiscal year, a copy of the Annual Report of the Company to
Shareholders for such year;
(ii) As soon as publicly available, a copy of
each report or definitive proxy statement of the Company filed with the
Commission under the Exchange Act or mailed to shareholders; and
(iii) From time to time, such other public
information concerning Peoples and the Company as Trident and McDonald may
reasonably request.
(h) The Company and Peoples will use the net proceeds
from the sale of the Shares in the manner set forth in the Offering Prospectus
under the caption "Use of Proceeds."
(i) The Company will not deliver the Shares until each and
every condition set forth in Section 5 of this Agreement has been satisfied in
full, unless such condition is waived in writing by Trident and McDonald.
(j) The Company and Peoples will take such actions and
furnish such information as are reasonably requested by Trident and McDonald in
order for Trident and McDonald to ensure compliance with the NASD's
"Interpretation Relating to Free-Riding and Withholding."
(k) The liquidation account for the benefit of Eligible
Account Holders and Supplemental Account Holders will be duly established and
maintained in accordance with the requirements of the OTS, and such Eligible
Account Holders and Supplemental Account Holders who continue to maintain their
savings accounts in Peoples will have an inchoate interest in their pro rata
portion of the liquidation account which shall have a priority superior to that
of the holders of shares of Common Stock in the event of a complete liquidation
of Peoples.
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(l) The Company and Peoples will not sell or issue, contract
to sell or otherwise dispose of, for a period of 90 days after the Closing
Date, without Trident's and McDonald's prior written consent, any shares of
Common Stock other than the Shares or other than in connection with any plan or
arrangement described in the Offering Prospectus, including existing stock
benefit plans.
(m) Other than as permitted by the Conversion Regulations,
the 1933 Act, the 1933 Act Regulations, and the laws of any state in which the
Shares are registered or qualified for sale or exempt from registration,
neither the Company nor Peoples will distribute any prospectus, offering
circular or other offering material in connection with the offer and sale of
the Shares.
(n) The Company will use its best efforts to (i) encourage
and assist a market maker to establish and maintain a market for the Shares and
(ii) list the Shares on a national or regional securities exchange or on the
Nasdaq Small Cap Market effective on or prior to the Closing Date.
(o) Peoples will maintain appropriate arrangements for
depositing all funds received from persons mailing subscriptions for or orders
to purchase Shares in the Offering on an interest-bearing basis at the rate
described in the Offering Prospectus until the Closing Date and satisfaction of
all conditions precedent to the release of Peoples' 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 Offering
Prospectus or until refunds of such funds have been made to the persons
entitled thereto or withdrawal authorizations cancelled in accordance with the
Plan and as described in the Offering Prospectus. Peoples 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
Peoples to make the appropriate refunds of such funds in the event that such
refunds are required to be made in accordance with the Plan and as described in
the Offering Prospectus.
(p) The Company will promptly take all necessary action to
register as a savings and loan holding company under the HOLA within 90 days of
the Closing Date.
(q) Peoples will not amend the Plan without notifying Trident
and McDonald prior thereto.
(r) The Company shall assist Trident and McDonald, if
necessary, in connection with the allocation of the Shares in the event of an
oversubscription and shall provide Trident and McDonald with any information
necessary to assist the Company in allocating the Shares in such event and such
information shall be accurate and reliable.
(s) Prior to the Closing Date, the Company and Peoples will
inform Trident and McDonald of any event or circumstances of which it is aware
as a result of which the Registration Statement and/or Offering Prospectus, as
then amended or supplemented, would contain an untrue statement of a material
fact or omit to state a material fact necessary in order to make the statements
therein not misleading.
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5. CONDITIONS OF TRIDENT AND MCDONALD'S OBLIGATIONS. The obligations
of Trident and McDonald set forth in this Agreement shall be subject to the
accuracy of the representations and warranties contained in Section l of this
Agreement as of the date hereof and as of the Closing Date, to the accuracy of
the statements of officers and directors of the Company and Peoples made
pursuant to the provisions hereof, to the performance by the Company and
Peoples of their respective covenants and obligations hereunder, and to the
following additional conditions:
(a) On the Closing Date, the Company and Peoples will have
satisfied the conditions precedent to, and will have conducted the Conversion
in all material respects in accordance with, the Plan, the Conversion
Regulations, and all applicable laws, regulations, decisions and orders,
including all terms, conditions, requirements and conditions precedent to the
Conversion imposed by the OTS.
(b) The Registration Statement shall have been declared
effective by the Commission and the Conversion Application approved by the OTS
not later than 5:30 p.m. on the date of this Agreement, or with Trident's and
McDonald's consent at a later time and date; and at the Closing Date, no stop
order suspending the effectiveness of the Registration Statement shall have
been issued under the 1933 Act or proceedings therefore initiated or threatened
by the Commission or any state authority, and no order or other action
suspending the authorization of the Offering Prospectus or the consummation of
the Conversion shall have been issued or proceedings therefore initiated or, to
the Company's or Peoples' knowledge, threatened by the Commission, the OTS, the
FDIC, or any state authority.
(c) On the Closing Date, Trident and McDonald shall receive
an opinion of Vorys, Sater, Seymour and Pease, special counsel for the Company
and Peoples (hereinafter referred to as "Special Counsel"), dated as of the
Closing Date, addressed to Trident and McDonald, in form and substance
reasonably satisfactory to Trident and McDonald and to the effect that:
(i) The Company has been duly incorporated
and is validly existing as a corporation under the laws of the State of Ohio
and its Articles of Incorporation and Regulations comply in all material
respects with the laws of the State of Ohio.
(ii) The Company has the corporate power and
authority to own, lease and operate its properties and to conduct its business
as described in the Registration Statement and the Offering Prospectus.
(iii) Before the Closing Date, Peoples was a
mutual savings association validly existing under the laws of the United States
with full power and authority to own its properties and conduct its business as
described in the Offering Prospectus. To its knowledge, Peoples has obtained
all licenses, permits and other governmental authorizations currently required
for the conduct of its business, all of which are in full force and effect, and
Peoples is in all material respects in compliance therewith, except where the
failure to so comply would not
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have a material adverse effect on Peoples. Before the Closing Date, the deposit
accounts of Peoples were insured up to applicable limits by the FDIC.
(iv) To the knowledge of such counsel, Peoples
owns of record and beneficially all of the outstanding shares of Massillon
Community Service Corporation and Massillon is the only subsidiary of Peoples.
Massillon is a corporation validly existing and in good standing under the laws
of the State of Ohio with full power and authority to own its properties and
conduct its business as described in the Offering Prospectus. To the knowledge
of such counsel, Massillon currently is conducting no business, other than
holding cash, and has no assets other than cash.
(v) The Plan complies with the Conversion
Regulations and has been duly and validly approved and adopted by the Board of
Directors and members of Peoples in its mutual form. To the knowledge of such
counsel, no person has sought to obtain review of the final action of the OTS
in approving the Plan or the Conversion Application pursuant to the HOLA, as
amended, or any other statute or regulation.
(vi) The form of the Stock Charter has
been approved by the OTS. Upon the consummation of the Conversion, Peoples
will be a stock savings association duly organized and validly existing under
the laws of the United States with full power and authority to own its
properties and conduct its business as set forth in the Offering Prospectus and
is a member of the FHLB of Cincinnati. Upon consummation of the Conversion, to
the knowledge of such counsel, Peoples, in its stock form, will have obtained
all licenses, permits and other governmental authorizations currently required
for the conduct of its business, all of which are in full force and effect, and
Peoples, in its stock form, is in all material respects in compliance
therewith, except where the failure to so comply would not have a material
adverse effect on Peoples, in its stock form.
(vii) Immediately after the Closing Date, the
deposit accounts of Peoples will be insured up to applicable limits by the
FDIC. To the knowledge of such counsel, no proceedings for the termination or
revocation of such insurance are pending or threatened. The descriptions of the
liquidation account as set forth in the Offering Prospectus under the captions
"The Conversion - Principal Effects of the Conversion - Tax Consequences" and
"- Liquidation Account" have been reviewed by such counsel and are accurate in
all material respects.
(viii) This Agreement has been duly and validly
executed and delivered by each of the Company and Peoples. 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 each of the Company and Peoples. This Agreement is a
legal, valid and binding obligation of each of the Company and Peoples,
enforceable against each of them in accordance with its terms, except as the
enforceability thereof may be limited by bankruptcy, insolvency, moratorium,
reorganization or similar laws relating to or affecting the enforcement of
creditors' rights generally or the rights of creditors of savings and loan
holding companies, the accounts of whose subsidiaries are insured by the FDIC
or by general equity principles regardless of whether such enforceability is
considered in a proceeding in equity or at
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law, and except to the extent, if any, that the provisions of Sections 6 and 7
of this Agreement may be unenforceable as against public policy.
(ix) Each of the Company and Peoples has all
such corporate power and authority, and, subject to the satisfaction of the
conditions to the OTS' approval of the Conversion Application and the Holding
Company Application, has received all approvals and consents from the OTS and
the Commission which are necessary to be obtained, to enter into this
Agreement, to perform all of its obligations hereunder and to consummate the
transactions contemplated hereby. Without limiting the generality of the
foregoing sentence, each of the Company and Peoples has the corporate power and
authority, and has received all approvals and consents from the Commission and
the OTS which are necessary to be obtained in order to offer, issue and sell up
to 1,719,250 shares of Company common stock in accordance with the Plan and the
Offering Prospectus and the OTS has approved the Holding Company Application
and issued its order of approval under the saving's and loan holding company
provisions of the HOLA, the purchase by the Company of all of the issued and
outstanding capital stock of Peoples has been authorized by the OTS and no
action has been taken and to such counsel's knowledge, none is pending or
threatened to revoke any such authorization or approval.
(x) To its knowledge and except as disclosed
in the Offering Prospectus, neither the Company, Peoples nor Massillon is in
material violation of any rule or regulation of the OTS or the FDIC which might
materially and adversely affect the condition (financial or otherwise),
operations, businesses, assets, or properties of the Company, Peoples or
Massillon. To its knowledge, neither the Company nor Peoples is subject to any
written directive from the OTS or the FDIC (or their predecessors) to make any
material change in the method of conducting its business or affairs. Except as
set forth in the Offering Prospectus, to its knowledge, there is not pending or
threatened any litigation, charge, investigation, action, suit or proceeding
before or by any court, regulatory authority or governmental agency or body
which might affect the performance of the terms and conditions of this
Agreement or the consummation of the transactions contemplated hereby or which
might result in any material adverse change in the condition (financial or
otherwise), business, prospects or results of operations of the Company or
Peoples.
(xi) To its knowledge, no material default
exists, and no event has occurred which, with notice or lapse of time, or both,
would constitute a default, on the part of either the Company, Peoples or
Massillon in the due performance and observance of any term, covenant or
condition of any agreement which is material to the condition (financial or
otherwise) of the Company, Peoples and Massillon taken as a whole. To its
knowledge, such agreements are in full force and effect, and no other party to
any such agreement has instituted or threatened any action or proceeding
wherein Peoples or Massillon would or might be alleged to be in default
thereunder.
(xii) To its knowledge, neither the Company,
Peoples nor Massillon is in violation of its respective Articles of
Incorporation, Charter, Regulations or Bylaws or the Corporate Regulations or
in default in any material respect in the performance of any material
obligation, agreement or condition contained in any bond, debenture, note or
any other evidence
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of indebtedness, except where such a default would not have a material adverse
affect on the Company, Peoples and Massillon taken as a whole. The execution,
delivery and fulfillment of the terms of this Agreement and the consummation of
the transactions contemplated hereby (A) do not and will not violate or
conflict with the respective Articles of Incorporation, Charter, Regulations or
Bylaws or Corporate Regulations of the Company, Peoples and Massillon or to its
knowledge, in any material respect, violate, conflict with or constitute a
breach of, or default (or an event which, with notice or lapse of time, or
both, would constitute a default) under (I) any material agreement, indenture
or other instrument by which the Company, Peoples or Massillon is bound, or
(II) any governmental license or permit or any law, administrative regulation
or authorization, approval, court decree, injunction or order, except where
such violation, conflict, breach or default would not have a material adverse
affect on the Company, Peoples and Massillon taken as a whole.
(xiii) Assuming compliance with applicable state
securities laws, the Common Shares to be issued and sold by the Company, when
the purchase orders have been accepted and the purchase price for the Common
Stock has been paid in money as specified in the Registration Statement, will
be validly issued and outstanding, fully paid and non-assessable; provided,
however, that until payments are received by the Company from the ESOP in
accordance with the terms of a loan agreement by and between the Company and
the ESOP, as set forth in the Registration Statement, shares for which the ESOP
submitted an order but for which payment in money has not been received will
not be fully paid and non-assessable. Upon the payment of the purchase price in
money as specified in the Registration Statement and upon compliance with the
other terms and conditions of their orders, the purchasers of the Shares will
acquire good title thereto, free and clear of any material lien, claim,
security interest or other encumbrance or other defect in title (except
restrictions on transfer under applicable law and except such claims as may be
asserted against the purchasers thereof by third party claimants). Except for
the subscription rights under the Plan of Conversion, there are no preemptive
or other rights to subscribe for or to purchase Shares, or, except as otherwise
set forth in Ohio or federal law, as applicable, or the Articles of
Incorporation and Regulations of the Company, any restriction upon the voting
of any common shares of the Company. At the time of the consummation of the
Conversion the Shares subscribed for will have been duly and validly authorized
for issuance and, upon payment for the Shares in accordance with the Plan. The
Shares will be validly issued, fully paid and non-assessable; the terms and
provisions of the Shares conform, in all material respects to the description
thereof contained in the Registration Statement and Offering Prospectus and
certificates evidencing the Shares are in due and proper form.
(xiv) Except where appropriate waivers have
been received and with respect to certain post-Conversion reports and any
other actions required to be performed after the Closing Date, Peoples and the
Company have, in all material respects, satisfied, to its knowledge (i) all
terms, conditions, requirements and provisions precedent to the consummation of
the transactions contemplated by the Plan and (ii) the conditions of approval
of the Conversion Application and the Holding Company Application imposed upon
them by the OTS.
(xv) 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
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issuance and sale of the Shares, except (i) the approval of the OTS, (ii) the
approval of the Commission, (iii) as may be otherwise required under the
securities laws of various jurisdictions and (iv) as may be required under the
rules and regulations of the NASD and/or the Nasdaq Small Cap Market.
(xvi) The Company may offer, issue and sell the
Shares in the Offering on the terms described in the Offering Prospectus
without registration of the Company, Peoples or their directors, officers or
employees as brokers or dealers under the Exchange Act.
(xvii) The statements in the Offering
Prospectus under the captions "Dividend Policy," "The Conversion,"
"Regulation," "Taxation," "Restrictions on Acquisition of Peoples Federal and
PFC and Related Anti-Takeover Provisions," and "Description of Authorized
Shares," insofar as they are, or refer to, statements of law or legal
conclusions, have been prepared or reviewed by such Special Counsel and are
correct in all material respects.
(xviii) The Registration Statement is effective
under the 1933 Act and, to the knowledge of such counsel, no stop order
suspending the effectiveness has been issued under the 1933 Act, or to such
counsel's knowledge, proceedings therefor been initiated or threatened by the
Commission.
(xix) The Conversion Application has been
approved by the OTS, and the Offering Prospectus has been authorized for use
by the OTS. To their knowledge, no proceedings are pending by or before the OTS
seeking to revoke or rescind the orders declaring the Conversion Application or
the Offering Prospectus effective nor, to its knowledge, are any such
proceedings contemplated or threatened.
(xx) The Conversion Application, the Proxy
Statement and the Offering Prospectus (in each case as amended or
supplemented, if so amended or supplemented) comply as to form in all material
respects with the requirements of the Conversion Regulations and the rules,
regulations and all written decisions and orders of the OTS, except as to
financial statements, notes to financial statements, financial tables and other
financial and statistical data included therein, as to which an opinion need
not be expressed. The Registration Statement and flee Offering Prospectus (in
each case as amended or supplemented, if so amended or supplemented) comply as
to form in all material respects with the requirements of the 1933 Act and the
1933 Act Regulations and the rules, regulations and all written decisions and
orders of the Commission, except as to financial statements, notes to financial
statements, financial tables and other financial and statistical data included
therein, as to which an opinion need not be expressed. To the knowledge of such
counsel, all documents and exhibits required to be filed with the Conversion
Application and the Registration Statement (in each case as amended or
supplemented, if so amended or supplemented) have been so filed or a waiver
from such filing has been obtained. The description in the Conversion
Application and the Registration Statement of such documents and exhibits is
accurate in all material respects and presents fairly the information required
to be shown. To the knowledge of such counsel, there are no contracts or other
documents of a character required to be described in the Registration
Statement, the Conversion Application, the Proxy Statement or the Offering
Prospectus which are not described. To the knowledge of such
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counsel, there are no statutes or regulations applicable to the Company or
Peoples of a character required to be disclosed in the Registration Statement,
the Conversion Application, the Proxy Statement or the Offering Prospectus
which have not been so disclosed and properly described therein. To the
knowledge of such counsel, there are no certificates, permits or other
authorizations from governmental regulatory officials or bodies required to be
obtained or maintained by, or legal or governmental proceedings, past, pending
or threatened, against the Company or Peoples of a character required to be
disclosed in the Registration Statement, the Conversion Application, the Proxy
Statement or the Offering Prospectus which have not been so disclosed and
properly described therein.
Such counsel shall state that no facts have come to the
attention of such counsel which would lead such counsel to believe that the
Registration Statement or the Conversion Application (including the Proxy
Statement and Offering Prospectus included therein), or any amendment thereto,
when such Registration Statement or Conversion Application or amendment became
effective, contained an untrue statement of a material fact or omitted 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 are made not
misleading and that no facts have come to the attention of such counsel which
would lead such counsel to believe that the Registration Statement or the
Conversion Application (including the Proxy Statement and Offering Prospectus
included therein), or any amendment thereto, the Offering Prospectus or Proxy
Statement at the time of the Closing Date, as amended or supplemented, contains
any untrue statement of a material fact or omits to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading (it being understood
that such counsel need express no opinion with respect to the financial
statements and the notes thereto and other financial, statistical and
accounting information included in the Registration Statement or Conversion
Application or the Offering Prospectus or Proxy Statement); provided, however,
that such counsel may state that, such counsel has not independently verified
the accuracy, completeness or fairness of the statements contained in the
Registration Statement, Conversion Application or Offering Prospectus or Proxy
Statement or any amendments thereof or supplements thereto, and such counsel
may further state that the limitations inherent in their participation in the
preparation of the Registration Statement, Conversion Application and the
Offering Prospectus or Proxy Statement and the knowledge available to them are
such that they are unable to assume, and do not assume, responsibility for the
accuracy, completeness or fairness of the statements contained in the
Registration Statement, Conversion Application and the Offering Prospectus or
Proxy Statement or any amendment thereof or supplement thereto.
In rendering such opinion, such counsel may rely (A) as to
matters involving the application of laws of any jurisdiction other than the
United States, to the extent such counsel deems proper and specified in such
opinion satisfactory to Trident and McDonald, upon the opinion of other counsel
of good standing (providing that such counsel states that it believes that
Trident and McDonald is justified in relying upon such specified opinion or
opinions), and (B) as to matters of fact, to the extent such counsel deems
proper, on certificates of responsible officers of Peoples, the Company and
their subsidiaries and public officials, provided copies of any such opinions
or certificates are delivered to Trident and McDonald together with the opinion
of such counsel. Such counsel may assume that any agreement is the valid and
binding obligation of any
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parties to such agreement other than Peoples, the Company or their
subsidiaries. As to matters stated in such opinion(s) to be "to such counsel's
knowledge" (or an equivalent phrase), such counsel may state in such opinion(s)
that such phrase refers to the actual conscious knowledge of the individual
lawyers involved in the actual representation of Peoples and the Company.
(d) Counsel for Trident and McDonald shall have been
furnished such documents as they reasonably may require for the purpose of
enabling them to review or pass upon the matters required by Trident and
McDonald and for the purpose of evidencing the accuracy, completeness or
satisfaction of any of the representations, warranties or conditions herein
contained, including, but not limited to, resolutions of the Board of Directors
of the Company and Peoples regarding the authorization of this Agreement and
the transactions contemplated hereby.
(e) Prior to and at the Closing Date, in the reasonable
opinion of Trident and McDonald: (i) there shall have been no material adverse
change in the financial or other condition of the Company or Peoples from that
as of the latest date as of which such condition is set forth in the Offering
Prospectus; (ii) there shall have been no material transaction entered into by
the Company or Peoples from the latest date as of which the financial condition
of the Company or Peoples is set forth in the Offering Prospectus, other than
transactions referred to or contemplated therein and transactions in the
ordinary course of business; (iii) the Company or Peoples shall not have
received from the OTS any direction (oral or written) to make any material
change in the method of conducting their respective businesses with which it
has not complied (which direction, if any, shall have been disclosed to Trident
and McDonald) or which materially and adversely would affect the business,
operations, financial condition or income of the Company or Peoples; (iv) no
action, suit or proceeding, at law or in equity, or before or by any federal or
state commission, board or other administrative agency, or before any
arbitrator or arbitrators, shall be pending or threatened against the Company
or Peoples or affecting any of their respective assets wherein an unfavorable
decision, ruling or finding materially and adversely would affect the business,
operations, financial condition or income of the Company or Peoples; and (v)
the Shares shall have been qualified or registered for offering and sale by the
Company under the securities or "blue sky" laws of each jurisdiction upon which
Trident and McDonald and the Company shall have agreed.
(g) At the Closing Date, Trident and McDonald shall receive a
certificate of the President and the Principal Financial Officer of each of
Peoples and the Company (hereinafter referred to as the "Officers"), dated the
Closing Date, to the effect that: (i) the Officers have carefully examined the
Offering Prospectus and, at the time the Offering Prospectus became authorized
for use, the Offering Prospectus did not contain any untrue statement of a
material fact or omit to state a material fact necessary in order to make the
statement therein, in light of the circumstances under which they were made,
not misleading; (ii) since the date the Offering Prospectus became authorized
for use, no event has occurred which should have been set forth in an amendment
or supplement to the Offering Prospectus which has not been so set forth,
including, without limitation, any material adverse change in the business,
financial condition, income or operations of Peoples, and the conditions set
forth in clauses (ii) through (iv) inclusive of subsection (d) of this Section
5 have been satisfied; (iii) no order has been issued by the
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Commission or the OTS to suspend the effectiveness of the Offering Prospectus
or to terminate the Offering and, to the best knowledge of the Officers, no
action for such purposes has been instituted or threatened by the Commission or
the OTS; (iv) to the best knowledge of the Officers, no person has sought to
obtain review of the final action of the OTS approving the Plan pursuant to
Section 5(i)(2)(B) of the Home Owners' Loan Act, as amended; and (v) all of the
representations and warranties contained in Section 1 of this Agreement are
true and correct with the same force and effect as though expressly made on the
Closing Date and all of the covenants and obligations of the Company and
Peoples set forth in this Agreement have been fulfilled.
(g) At the Closing Date, Trident and McDonald shall receive,
among other documents, (i) a copy of the letter from the Commission approving
the Registration Statement; (ii) a copy of the letter from the OTS approving
the Conversion Application and authorizing the use of the Offering Prospectus;
(iii) a copy of the letter from the OTS evidencing the corporate existence of
Peoples; and (iv) a copy of the letter from the OTS approving the Stock
Association's Stock Charter.
(h) As soon as available after the Closing Date, Trident and
McDonald shall receive a certified copy of Peoples' Stock Charter executed by
the OTS.
(i) Concurrently with the execution of this Agency Agreement,
Trident and McDonald shall have received a letter from Hall, Kistler & Company
P.L.L. independent certified public accountants, dated the date hereof and
addressed to Trident and McDonald, in substance and form reasonably
satisfactory to counsel for Trident and McDonald, with respect to the financial
statements and certain financial information contained in the Offering
Prospectus.
(j) At the Closing Date, Trident and McDonald shall receive a
letter in form and substance reasonably satisfactory to counsel for Trident and
McDonald from Hall, Kistler & Company P.L.L., independent certified public
accountants, dated the Closing Date and addressed to Trident and McDonald,
confirming the statements made by them in the letter delivered by them pursuant
to the preceding subsection as of a specified date not more than five (5)
business days prior to the Closing Date.
(k) All corporate proceedings and action taken by the Company
or Peoples in connection with the issuance and sale of the Shares as herein
contemplated shall be reasonably satisfactory in form and substance to Trident
and McDonald and their counsel.
(l) All opinions, certificates, letters and documents
prepared for Trident's and McDonald's reliance shall be in compliance with the
provisions hereof only if they are, in the reasonable opinion of Trident and
McDonald, satisfactory to Trident and McDonald. Any certificates signed by an
officer or director of the Company or Peoples prepared for Trident's and
McDonald's reliance and delivered to Trident and McDonald or to counsel for
Trident and McDonald shall be deemed a representation and warranty by the
Company and Peoples to Trident and McDonald as to the statements made therein.
If any condition to Trident's and McDonald's obligations hereunder to be
fulfilled prior to or at the Closing Date is not so fulfilled, Trident and
McDonald may terminate this Agreement or, if Trident and McDonald so elect, may
waive any
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such conditions which have not been fulfilled, or may extend the time of their
fulfillment. If Trident and McDonald terminate this Agreement in accordance
with the foregoing, Peoples shall reimburse Trident and McDonald for their
accountable expenses as provided in Section 2 of this Agreement.
6. Indemnification.
---------------
(a) The Company hereby agrees to indemnify and hold harmless
Trident and McDonald, their officers, directors and employees and each person,
if any, who controls either Trident and McDonald within the meaning of Section
15 of the Securities Act of 1933, as amended, or Section 20(a) of the Exchange
Act:
(i) Against any and all loss, liability,
claim, damage and expense whatsoever, including, but not limited to, legal
fees and expenses, reasonably incurred by any of them in investigating,
preparing to defend or defending against any action, proceeding or claim
(whether commenced or threatened) (A) arising out of or based upon any breach
of any representation or warranty set forth in this Agreement, or any breach of
warranty by the Company or Peoples with respect to this Agreement, (B) arising
out of or based upon the failure of the Company or Peoples to fulfill any
covenant or obligation set forth in this Agreement, or arising out of or based
upon any untrue or alleged untrue statement of a material fact or the omission
or alleged omission of a material fact required to be stated or necessary to
make not misleading any statements contained in (I) the Registration Statement,
Conversion Application, the Proxy Statement or the Offering Prospectus or (II)
any other document or communication prepared or executed by or on behalf of the
Company or Peoples or based upon written information furnished by or on behalf
of the Company or Peoples with the consent of the Company or Peoples to effect
the Conversion or qualify the Shares under the securities laws of the United
States or any state or filed with the Commission or the OTS, unless such
statement or omission was made in reliance upon and in conformity with written
information furnished to the Company or Peoples with respect to Trident or
McDonald by or on behalf of Trident or McDonald expressly for use in the
Registration Statement, Conversion Application, Proxy Statement, the Offering
Prospectus or any document filed to qualify the Shares under the securities
laws of any state, or any amendment or supplement thereof, or in the Offering
Prospectus. This indemnity shall be in addition to any liability the Company or
Peoples may have to Trident and McDonald otherwise; and
(ii) Against any and all loss, liability,
claim, damage and expense whatsoever to the extent of the aggregate amount
paid in settlement of any litigation, investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any untrue statement or omission referenced in subsection
(i) of this Section 6(a), or any alleged untrue statement or omission
referenced in subsection (i) of this Section 6(a), if such settlement is
effected with the prior written consent of the Company or Peoples.
(b) Trident and McDonald hereby agree to indemnify and hold
harmless the Company and Peoples, their respective officers, directors and
employees and each person, if any, who controls the Company within the meaning
of Section 15 of the Act or Section 20(a) of the
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Exchange Act, to the same extent as the foregoing indemnity from the Company
and Peoples to Trident and McDonald, but only with respect to statements or
omissions, if any, made in the Offering Prospectus, the Proxy Statement, the
Registration Statement, the Conversion Application or any document filed to
qualify the Shares under the securities laws of any state, as amended or
supplemented, in reliance upon, and in conformity with, written information
furnished to the Company or Peoples with respect to Trident or McDonald by or
on behalf of Trident or McDonald expressly for use in the Offering Prospectus,
the Proxy Statement, the Registration Statement, the Conversion Application or
any document filed to qualify the Shares under the securities laws of any
state, as amended or supplemented.
(c) Promptly after receipt by an indemnified party under
this Section 6 of notice of the commencement of any action, such indemnified
party will, if a claim in respect thereof is to be made against the
indemnifying party under this Section 6, notify the indemnifying party of the
commencement thereof, provided, however, that the omission to so notify the
indemnifying party will not relieve the indemnifying party from any liability
which it may have to any indemnified party otherwise than under this Section 6.
In case any such action is brought against any indemnified party, and the
indemnified party notifies the indemnifying party of the commencement thereof,
the indemnifying party will be entitled to participate therein and, to the
extent that the indemnifying party may wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel satisfactory to such indemnified party, and after notice from the
indemnifying party to such indemnified party of the indemnifying party's
election so to assume the defense thereof, the indemnifying party will not be
liable to such indemnified party under this Section 6 for any legal or other
expenses subsequently incurred by such indemnified party in connection with the
defense thereof, other than the reasonable cost of investigation, except as
otherwise provided herein. In the event the indemnifying party elects to assume
the defense of any such action and retain counsel acceptable to the indemnified
party, the indemnified party may retain additional counsel, but shall bear the
fees and expenses of such counsel unless (i) the indemnifying party shall have
specifically authorized the indemnified party to retain such counsel or (ii)
the parties to such suit include such indemnifying party and the indemnified
party, and such indemnified party shall have been advised by counsel that one
or more material legal defenses may be available to the indemnified party which
may not be available to the indemnifying party, in which case the indemnifying
party shall not be entitled to assume the defense of such suit notwithstanding
the indemnifying party's obligation to bear the fees and expenses of such
counsel. An indemnifying party against whom indemnity may be sought shall not
be liable to indemnify an indemnified party under this Section 6 if any
settlement of any such action is effected without such indemnifying party's
consent.
7. Contribution.
------------
(a) The parties agree that the provisions of this Section 7
shall apply to the fullest extent permitted by Section 23A of the Federal
Reserve Act. In order to provide for just and equitable contribution in
circumstances in which the indemnity provided for in Section 6 of this
Agreement is for any reason held to be unavailable to Trident and McDonald
other than in accordance with its terms, the Company and/or Peoples and Trident
and McDonald shall contribute to the aggregate losses, liabilities, claims,
damages, and expenses of the nature
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contemplated by such indemnity incurred by the Company and/or Peoples and
Trident and McDonald (i) in such proportion as is appropriate to reflect the
relative benefits received by the Company and/or Peoples on the one hand and
Trident and McDonald on the other from the offering of the Shares or, (ii) if
the allocation provided by clause (i) above is not permitted by applicable law,
in such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Company
and/or Peoples on the one hand and Trident and McDonald on the other, in
connection with the statements or omissions which resulted in such losses,
claims, damages, liabilities or judgments, as well as any other relevant
equitable considerations. The relative benefits received by the Company and/or
Peoples, on the one hand, and Trident and McDonald, on the other, shall be
deemed to be in the same proportions as the total proceeds from the sale of the
Shares (before deducting expenses) received by the Company and/or Peoples bear
to the total fees received by Trident and McDonald under this Agreement. The
relative fault of the Company and/or Peoples on the one hand and Trident and
McDonald on the other shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company and/or Peoples or by Trident and McDonald, the relative
intent of the parties, the knowledge of the parties, access to information, and
opportunity to correct or prevent such statement or omission.
(b) The Company and Peoples and Trident and McDonald agree
that it would not be just and equitable if contribution pursuant to this
Section 7 were determined by pro rata allocation or by any other method of
allocation which does not take account of the equitable considerations referred
to in the immediately preceding paragraph. The amount paid or payable by an
indemnified party as a result of the losses, claims, damages, liabilities or
judgments referred to in the immediately preceding paragraph shall be deemed to
include, subject to the limitations set forth above, any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 7, Trident and McDonald shall not be required to
contribute any amount in excess of the amount by which fees owed Trident and
McDonald pursuant to this Agreement exceed the amount of any damages which
Trident and McDonald has otherwise been required to pay by reason of such
untrue or alleged untrue statement or omission or alleged omission. No person
guilty of fraudulent misrepresentation (within the meaning of Section II (f) of
the Act) shall be entitled to contribution from any person who is not guilty of
such fraudulent misrepresentation.
(c) To the extent Trident and McDonald are required by this
Section 7 to indemnify or make a contribution to the Company and/or Peoples,
each of Trident and McDonald shall be required to pay a proportion of such
total amount of indemnification or contribution equal to a fraction, the
numerator of which is the aggregate amount of fees received by Trident or
McDonald, as the case may be, pursuant to this Agreement and the denominator of
which is the aggregate amount of fees received by both Trident and McDonald
pursuant to this Agreement.
8. SURVIVAL OF AGREEMENTS REPRESENTATIONS AND INDEMNITIES. The
respective indemnities of the Company and Peoples and of Trident and McDonald
and the representations and warranties of the Company and Peoples set forth in
or made pursuant to this Agreement shall
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remain in full force and effect regardless of any termination or cancellation
of this Agreement or any investigation made by or on behalf of Trident and
McDonald or the Company or Peoples or any controlling person or indemnified
party referred to in Section 6 of this Agreement, and shall survive any
termination of this Agreement and/or the issuance of the Shares. Any successor
or assign of Trident and McDonald, the Company or Peoples, any such controlling
person and any legal representative of Trident and McDonald, the Company or
Peoples shall be entitled to the- benefit of the respective agreements,
indemnities, warranties and representations contained in this Agreement.
9. Termination.
-----------
(a) Trident and McDonald may terminate this Agreement by
giving notice at any time after this Agreement becomes effective, as follows:
(i) If the obligations of Trident and McDonald
cannot, in the reasonable opinion of Trident and McDonald, be fulfilled
because of the breach of any of the representations or warranties contained in
Section 1 of this Agreement, the failure by the Company or Peoples to perform
their covenants and obligations under this Agreement or the failure of the
Company or Peoples to fulfill any of the other conditions set forth under
Section 5 of this Agreement.
(ii) If any domestic or international event or
act or occurrence has materially disrupted the United States securities
markets such as to make impracticable, in Trident's and McDonald's reasonable
opinion, proceeding with the offering of the Shares; or if trading on the New
York Stock Exchange shall have been suspended or if limits in prices or volumes
or the manner of trading shall have been imposed by the New York Stock
Exchange; or if the United States shall have become involved in a war or major
hostilities; or if a general banking moratorium has been declared by a state or
federal authority; or if a moratorium in foreign exchange trading by major
international banks or persons has been declared; or if there shall have been a
material adverse change in the capitalization, condition or business of the
Company or Peoples; or if the Company or Peoples shall have sustained a
material or substantial loss by, but not limited to, fire, flood, accident,
hurricane, earthquake, theft, sabotage or other calamity or malicious act,
whether or not said loss shall have been insured; or if there shall have been a
material adverse change in the condition or prospects of the Company or
Peoples; or if Trident and McDonald elect to terminate this Agreement under any
other section of this Agreement.
(iii) If Trident and McDonald elect to terminate
this Agreement as provided in this Section 9, the Company and Peoples shall be
notified promptly by Trident and McDonald by telephone or telegram, confirmed
by letter.
(iv) If this Agreement is terminated by Trident
and McDonald for any of the reasons set forth in subsections (a) or (b) of this
Section 9, the Company or Peoples shall reimburse Trident and McDonald for any
expenses incurred by Trident and McDonald and reimbursable in accordance with
Section 2 of this Agreement.
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(b) (i) The Company or Peoples may terminate this Agreement
by giving notice of a material breach of this Agreement by McDonald or Trident
at any time after this Agreement becomes effective.
(ii) If the Company or Peoples elects to terminate
this Agreement as provided in this Section 9, Trident and McDonald shall be
notified promptly by the Company or Peoples by telephone or telegram,
confirmed by letter.
10 NOTICES. All communications hereunder, except as herein
otherwise specifically provided, shall be in writing and:
If sent to Trident and McDonald, shall be mailed, delivered or telegraphed and
confirmed to:
Timothy E. Lavelle
President
Trident Securities, Inc.
4601 Six Forks Road, 4th Floor
Raleigh, North Carolina 27609
and
Charles R. Crowley
Managing Director
McDonald & Company Securities, Inc.
2100 McDonald Investment Center
800 Superior Avenue Cleveland,
Ohio 44114-2603
with a copy to:
John Bruno
Muldoon, Murphy & Faucette
5101 Wisconsin Avenue
Washington, D.C. 20016
If sent to the Company or Peoples, shall be mailed, delivered or telegraphed
and confirmed to:
Paul von Gunten
Peoples Financial Corporation
211 Lincoln Way East
Massillon, Ohio 44646
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with a copy to:
John C. Vorys, Esq.
Vorys, Sater, Seymour and Pease
Suite 2100, Atrium Two
221 East Fourth Street
Cincinnati, Ohio 45202
11. PARTIES. The Company and Peoples shall be entitled to act and rely
on any request, notice, consent, waiver or agreement purportedly given on
behalf of Trident and McDonald when the same shall have been given by the
undersigned. Trident and McDonald shall be entitled to act and rely on any
request, notice, consent, waiver, or agreement purportedly given on behalf of
the Company or Peoples, when the same shall have been given by the undersigned
or any other officer of the Company or Peoples. This Agreement shall inure
solely to the benefit of, and shall be binding upon, Trident and McDonald, the
Company, Peoples and the controlling persons and indemnified parties referred
to in Section 6 of this Agreement, and their respective successors, legal
representatives and assigns, and no other person shall have or be construed to
have any legal or equitable right, remedy or claim under, or in respect of, or
by virtue of, this Agreement or any provision herein contained.
12. CLOSING. At the Closing, Trident and McDonald shall submit a list
of the persons subscribing for the Shares and the number of Shares so
subscribed. The Company or Peoples shall deliver to Trident and McDonald in
immediately available funds the commissions and remaining expenses due and
owing to Trident and McDonald as set forth in Section 2 of this Agreement, and
the opinions and certificates required hereby and other documents deemed
reasonably necessary by Trident and McDonald shall be executed and delivered to
effect the sale of the Shares as contemplated hereby and pursuant to the terms
of the Offering Prospectus.
13. PARTIAL INVALIDITY. In the event that any term, provision or
covenant of this Agreement 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 such term, provision or covenant to any other
circumstance or situation shall not be affected thereby, and each term,
provision or covenant of this Agreement shall be valid and enforceable to the
full extent permitted by law.
14. CONSTRUCTION. This Agreement shall be construed in
accordance with the laws of the State of Ohio.
15. COUNTERPARTS. This Agreement may be executed in separate
counterparts, each of which when so executed and delivered shall be an
original, but all of which together shall constitute but one and the same
instrument.
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If the foregoing correctly sets forth the understanding between Trident and
McDonald and the Company and Peoples, please so indicate in the space provided
below for that purpose, whereupon this letter shall constitute a binding
agreement between Trident and McDonald and the Company and Peoples.
Very truly yours,
PEOPLES FINANCIAL CORPORATION
By: /s/ Paul von Gunten
--------------------------------------
Paul von Gunten
President and Chief Executive Officer
PEOPLES FEDERAL SAVINGS AND LOAN
ASSOCIATION OF MASSILLON
By: /s/ Paul von Gunten
--------------------------------------
Paul von Gunten
President and Chief Executive Officer
Accepted as of the date first above written:
TRIDENT SECURITIES, INC.
By: /s/ Timothy E. Lavelle
----------------------------
McDONALD & COMPANY SECURITIES, INC.
By: /s/ Charles R. Crowley
----------------------------
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