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Exhibit 1.2
OHIO STATE FINNCIAL SERVICES, INC.
776,250 Shares
COMMON SHARES
(No Par Value)
Subscription Price $10.00 Per Share
AGENCY AGREEMENT
________ __, 1997
Charles Webb & Company, a division of
Keefe, Bruyette & Woods, Inc.
211 Bradenton Drive
Dublin, Ohio 43017-5034
Ladies and Gentlemen:
Ohio State Financial Services, Inc., an Ohio corporation (the
"Company") and Bridgeport Savings and Loan Association, Bridgeport, Ohio, an
Ohio chartered mutual savings and loan association (references to the
"Association" include the Association in the mutual or stock form, as indicated
by the context), with its deposit accounts insured by the Savings Association
Insurance Fund ("SAIF") administered by the Federal Deposit Insurance
Corporation ("FDIC")), hereby confirm their agreement with Charles Webb &
Company, a division of Keefe, Bruyette & Woods, Inc. ("Webb", "KBW" or "the
Agent"), as follows:
SECTION 1. THE OFFERING. The Association, in accordance with its plan
of conversion adopted by its Board of Directors (the "Plan"), intends to convert
from an Ohio chartered mutual savings and loan association to an Ohio chartered
stock savings and loan association, and will issue all of its issued and
outstanding capital stock to the Company. In addition, pursuant to the Plan, the
Company will offer and sell up to 776,250 shares of its common stock, no par
value per share (the "Shares" or "Common Shares"), in a subscription offering
(the "Subscription Offering") to (1) depositors of the Association with
Qualifying
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Deposits (as defined in the Association's Plan of Conversion) as of December 31,
1995 ("Eligible Account Holders"), (2) the Ohio State Financial Services, Inc.
Employee Stock Ownership Plan (the "ESOP"), (3) depositors of the Association
with Qualifying Deposits as of September 30, 1997 ("Supplemental Eligible
Account Holders"), (4) the Association's Other Eligible Members (as defined in
the Association's Plan of Conversion) and (5) employees, officers and directors
of the Association. Subject to the prior subscription rights of the above-listed
parties, the Company is offering for sale in a community offering (the
"Community Offering" and when referred to together with the Subscription
Offering, the "Subscription and Community Offering") conducted concurrently with
the Subscription Offering, the Shares not so subscribed for or ordered in the
Subscription Offering to members of the general public to whom a copy of the
Prospectus (as hereinafter defined) is delivered ("Other Subscribers"), with a
preference given to natural persons who reside in Belmont County, Ohio (all such
offerees being referred to in the aggregate as "Eligible Offerees"). It is
anticipated that shares not subscribed for in the Subscription and Community
Offering will be offered to certain members of the general public on a best
efforts basis through a selected dealers arrangement (the "Syndicated Community
Offering") (the Subscription Offering, Community Offering and Syndicated
Community Offering are collectively referred to as the "Offering"). It is
acknowledged that the purchase of Shares in the Offering is subject to the
maximum and minimum purchase limitations as described in the Plan and that the
Company and the Association may reject, in whole or in part, any orders received
in the Community Offering or Syndicated Community Offering. Collectively, these
transactions are referred to herein as the "Conversion."
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-1 (File No. 333-_____) (the
"Registration Statement") containing a prospectus relating to the Offering for
the registration of the Shares under the Securities Act of 1933 (the "1933
Act"), and has filed such amendments thereof and such amended prospectuses as
may have been required to the date hereof. The term "Registration Statement"
shall include any documents incorporated by reference therein and all financial
schedules and exhibits thereto, as amended, including post-effective amendments.
The prospectus, as amended, on file with the Commission at the time the
Registration Statement initially became effective is hereinafter called the
"Prospectus," except that if any Prospectus is filed by the Company pursuant to
Rule
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424(b) or (c) of the rules and regulations of the Commission under the 1933 Act
(the "1933 Act Regulations") differing from the prospectus on file at the time
the Registration Statement initially becomes effective, the term "Prospectus"
shall refer to the prospectus filed pursuant to Rule 424(b) or (c) from and
after the time said prospectus is filed with the Commission.
In accordance with Title 12, Part 563b of the Code of Federal
Regulations (the "Conversion Regulations"), the Association has filed with the
Office of Thrift Supervision (the "OTS") and the Division of Financial
Institutions of the Department of Commerce of the State of Ohio (the "Division")
an Application for Approval of Conversion on Form AC (the "Conversion
Application"), including the Prospectus and the Conversion Valuation Appraisal
Report prepared by RP Financial (the "Appraisal") and has filed such amendments
thereto as may have been required by the OTS and the Division. The Conversion
Application has been approved by the OTS, the Division and the related
Prospectus has been authorized for use by the OTS and the Division. In addition,
the Company has filed with the OTS its application on Form H-(e)1-S (the
"Holding Company Application") to become a registered savings and loan holding
company under the Home Owners' Loan Act, as amended ("HOLA"); and it has been
approved.
SECTION 2. RETENTION OF AGENT; COMPENSATION; SALE AND DELIVERY OF THE
SHARES. Subject to the terms and conditions herein set forth, the Company and
the Association hereby appoint the Agent as their exclusive financial advisor
and marketing agent (i) to utilize its best efforts to solicit subscriptions for
Shares of the Company's Common Stock and to advise and assist the Company and
the Association with respect to the Company's sale of the Shares in the Offering
and (ii) to participate in the Offering in the areas of market making, research
coverage and in syndicate formation (if necessary).
On the basis of the representations, warranties, and agreements herein
contained, but subject to the terms and conditions herein set forth, the Agent
accepts such appointment and agrees to consult with and advise the Company and
the Association as to the matters set forth in the letter agreement ("Letter
Agreement"), dated March 1, 1997 between the Association and Webb (a copy of
which is attached hereto as Exhibit A). It is acknowledged by the Company and
the Association that the Agent shall not be required to purchase any Shares or
be obligated to take any action which is inconsistent with all applicable laws,
regulations, decisions or orders.
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The obligations of the Agent pursuant to this Agreement (other than
those set forth in Sections 2(d) and (e) hereof) shall terminate upon the
completion or termination or abandonment of the Plan by the Company or upon
termination of the Offering, but in no event later than 45 days after the
completion of the Subscription Offering (the "End Date"). All fees or expenses
due to the Agent but unpaid will be payable to the Agent in next day funds at
the earlier of the Closing Date (as hereinafter defined) or the End Date. In the
event the Offering is extended beyond the End Date, the Company, the Association
and the Agent may agree to renew this Agreement under mutually acceptable terms.
In the event the Company is unable to sell a minimum of 573,750 Shares
within the period herein provided, this Agreement shall terminate and the
Company shall refund to any persons who have subscribed for any of the Shares,
the full amount which it may have received from them plus accrued interest as
set forth in the Prospectus; and none of the parties to this Agreement shall
have any obligation to the other parties hereunder, except as set forth in this
Section 2 and in Sections 6, 8 and 9 hereof.
In the event the Offering is terminated for any reason not attributable
to the action or inaction of the Agent, the Agent shall be paid the fees due to
the date of such termination pursuant to subparagraphs (a) and (d) below.
If all conditions precedent to the consummation of the Conversion,
including, without limitation, the sale of all Shares required by the Plan to be
sold, are satisfied, the Company agrees to issue, or have issued, the Shares
sold in the Offering and to release for delivery certificates for such Shares on
the Closing Date (as hereinafter defined) against payment to the Company by any
means authorized by the Plan; provided, however, that no funds shall be released
to the Company until the conditions specified in Section 7 hereof shall have
been complied with to the reasonable satisfaction of the Agent and their
counsel. The release of Shares against payment therefor shall be made on a date
and at a place acceptable to the Company, the Association and the Agent.
Certificates for shares shall be delivered directly to the purchasers in
accordance with their directions. The date upon which the Company shall release
or deliver the Shares sold in the Offering, in accordance with the terms herein,
is called the "Closing Date."
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The Agent shall receive the following compensation for its services
hereunder:
(a) A management fee of $25,000 payable in four consecutive
monthly installments of $6,250, the first of which was due on
March 1, 1997. Such fees shall be deemed to have been earned
when due. Should the Conversion be terminated for any reason
not attributable to the action or inaction of the Agent, the
Agent shall have earned and be entitled to be paid fees
accruing through the stage at which the termination occurred.
(b) A Success Fee of 1.50% of the aggregate Purchase Price of
Common Shares sold in the Subscription Offering and Community
Offering excluding shares purchased by the Association's
officers, directors, or employees (or members of their
immediate families) plus any ESOP, tax-qualified or stock
based compensation plans (except IRA's) or similar plan
created by the Association for some or all of its directors or
employees.
(c) If any of the shares remain available after the Subscription
Offering, at the request of the Association, Webb will seek to
form a syndicate of registered broker-dealers to assist in the
sale of such Common Shares on a best efforts basis, subject to
the terms and conditions set forth in the selected dealers
agreement. Webb will endeavor to distribute the Common Shares
among dealers in a fashion which best meets the distribution
objectives of the Association and the Plan of Conversion. Webb
will be paid a fee not to exceed 5.5% of the aggregate
Purchase Price of the Shares sold by them. Webb will pass onto
selected broker-dealers, who assist in the syndicated
community, an amount competitive with gross underwriting
discounts charged at such time for comparable amounts of stock
sold at a comparable price per share in a similar market
environment. Fees with respect to purchases affected with the
assistance of a broker/dealer other than Webb shall be
transmitted by Webb to such broker/dealer. The decision to
utilize selected broker-dealers will be made by the
Association upon consultation with Webb. In the event, with
respect to any purchases of Shares, fees paid pursuant to this
subparagraph 2(c), such fees shall be in lieu of, and not in
addition to, payment pursuant to subparagraph 2(a) and 2(b).
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(d) The Association and the Company hereby agree to reimburse the
Agent for the reasonable fees and expenses of its Counsel.
SECTION 3. PROSPECTUS; OFFERING. The Shares are to be initially
offered in the Offering at the Purchase Price as defined and set forth on the
cover page of the Prospectus.
SECTION 4. REPRESENTATIONS AND WARRANTIES. The Company and the
Association jointly and severally represent and warrant to and agree with the
Agent as follows:
(a) The Registration Statement which was prepared by the Company
and the Association and filed with the Commission was declared
effective by the Commission on __________ __, 1997. At the
time the Registration Statement, including the Prospectus
contained therein (including any amendment or supplement),
became effective, the Registration Statement contained all
statements that were required to be stated therein in
accordance with the 1933 Act and the 1933 Act Regulations,
complied in all material respects with the requirements of the
1933 Act and the 1933 Act Regulations and the Registration
Statement, including the Prospectus contained therein
(including any amendment or supplement thereto), and any
information regarding the Company or the Association contained
in Sales Information (as such term is defined in Section 8
hereof) authorized by the Company or the Association for use
in connection with the Offering, did not contain an untrue
statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which
they were made, not misleading, and at the time any Rule
424(b) or (c) Prospectus was filed with the Commission and at
the Closing Date referred to in Section 2, the Registration
Statement, including the Prospectus contained therein
(including any amendment or supplement thereto), and any
information regarding the Company or the Association contained
in Sales Information (as such term is defined in Section 8
hereof)
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authorized by the Company or the Association for use in
connection with the Offering will contain all statements that
are required to be stated therein in accordance with the 1933
Act and the 1933 Act Regulations and will not contain an
untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements
therein, in light of the circumstances under which they were
made, not misleading; provided, however, that the
representations and warranties in this Section 4(a) shall not
apply to statements or omissions made in reliance upon and in
conformity with written information furnished to the Company
or the Association by the Agent or its counsel expressly
regarding the Agent for use in the Prospectus under the
caption "The Conversion-Plan of Distribution" or statements in
or omissions from any Sales Information or information filed
pursuant to state securities or blue sky laws or regulations
regarding the Agent.
(b) The Conversion Application which was prepared by the Company
and the Association and filed with the OTS and the Division
was approved by the OTS and the Division on _______ __, 1997
and the related Prospectus has been authorized for use by the
OTS and the Division. At the time of the approval of the
Conversion Application, including the Prospectus (including
any amendment or supplement thereto), by the OTS and the
Division and at all times subsequent thereto until the Closing
Date, the Conversion Application, including the Prospectus
(including any amendment or supplement thereto), will comply
in all material respects with the Conversion Regulations,
except to the extent waived in writing by the OTS. The
Conversion Application, including the Prospectus (including
any amendment or supplement thereto), does not include any
untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances
under which they were made, not misleading; provided, however,
that the representations and warranties in this Section
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4(b) shall not apply to statements or omissions made in
reliance upon and in conformity with written information
furnished to the Company or the Association by the Agent or
its counsel expressly regarding the Agent for use in the
Prospectus contained in the Conversion Application under the
caption "The Conversion-Plan of Distribution" or statements in
or omissions from any sales information or information filed
pursuant to state securities or blue sky laws or regulations
regarding the Agent. The Holding Company Application for
approval pursuant to the HOLA and the regulations promulgated
thereunder (the "Control Act Regulations"), has been prepared
by the Association and the Company in material conformity with
the requirements of the Control Act Regulations and has been
filed with and approved by the OTS. A conformed copy of the
Holding Company Application has been delivered to the Agent.
(c) The Company has filed with the OTS the Holding Company
Application, and such Application was deemed complete by the
OTS. As of the Closing Date, approval of the Company's
acquisition of the Association will have been obtained from
the OTS.
(d) No order has been issued by the OTS, the Division or the FDIC
(hereinafter any reference to the FDIC shall include the SAIF)
preventing or suspending the use of the Prospectus, and no
action by or before any such government entity to revoke any
approval, authorization or order of effectiveness related to
the Conversion is, to the best knowledge of the Company or the
Association, pending or threatened.
(e) At the Closing Date, the Plan will have been adopted by the
Boards of Directors of both the Company and the Association
and approved by the members of the Association, and the offer
and sale of the Shares will have been conducted in all
material respects in accordance with the Plan, the Conversion
Regulations, and all other applicable laws, regulations,
decisions and orders, including all terms, conditions,
requirements and provisions
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precedent to the Conversion imposed upon the Company or the
Association by the OTS, the Commission, or any other
regulatory authority and in the manner described in the
Prospectus. No person has sought to obtain review of the final
action of the OTS in approving the Plan or in approving the
Conversion or the Holding Company Application pursuant to the
HOLA, or any other statute or regulation.
(f) The Association has been organized and is a validly existing
Ohio chartered savings and loan association in mutual form of
organization and upon the Conversion will become a duly
organized and validly existing federally chartered savings and
loan association in capital stock form of organization, in
both instances duly authorized to conduct its business and own
its property as described in the Registration Statement and
the Prospectus; the Association has obtained all material
licenses, permits and other governmental authorizations
currently required for the conduct of its business; all such
licenses, permits and governmental authorizations are in full
force and effect, and the Association is in all material
respects complying with all laws, rules, regulations and
orders applicable to the operation of its business; the
Association is existing under the laws of the state of Ohio
and is duly qualified as a foreign corporation to transact
business and is in good standing in each jurisdiction in which
its ownership of property or leasing of property or the
conduct of its business requires such qualification, unless
the failure to be so qualified in one or more of such
jurisdictions would not have a material adverse effect on the
condition, financial or otherwise, or the business, operations
or income of the Association. The Association does not own
equity securities or any equity interest in any other business
enterprise except as described in the Prospectus or as would
not be material to the operations of the Association. Upon
completion of the sale by the Company of the Shares
contemplated by the Prospectus, (i) the Association will be
converted pursuant to the Plan to an Ohio
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chartered stock savings and loan association, (ii) all of the
authorized and outstanding capital stock of the Association
will be owned by the Company, and (iii) the Company will have
no direct subsidiaries other than the Association. The
Conversion will have been effected in all material respects in
accordance with all applicable statutes, regulations,
decisions and orders; and, except with respect to the filing
of certain post-sale, post-Conversion reports, and documents
in compliance with the 1933 Act Regulations, the OTS'
resolutions or letters of approval, all terms, conditions,
requirements and provisions with respect to the Conversion
imposed by the Commission, the OTS, the Division and the FDIC,
if any, will have been complied with by the Company and the
Association in all material respects or appropriate waivers
will have been obtained and all material notice and waiting
periods will have been satisfied, waived or elapsed.
(g) The Company has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the State
of Ohio with corporate power and authority to own, lease and
operate its properties and to conduct its business as
described in the Registration Statement and the Prospectus,
and at the Closing Date the Company will be qualified to do
business as a foreign corporation in each jurisdiction in
which the conduct of its business requires such qualification,
except where the failure to so qualify would not have a
material adverse effect on the condition, financial or
otherwise, or the business, operations or income of the
Company. The Company has obtained all material licenses,
permits and other governmental authorizations currently
required for the conduct of its business; all such licenses,
permits and governmental authorizations are in full force and
effect, and the Company is in all material respects complying
with all laws, rules, regulations and orders applicable to the
operation of its business.
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(h) The Association has one wholly owned subsidiary, Trailway
Financial, Inc., which is duly incorporated and validly
existing as a corporation in good standing under the laws of
the State of Ohio, and is duly licensed and possessed of full
corporate power and authority to own its properties and
conduct its business as described in the Prospectus.
(i) The Association is a member of the Federal Home Loan Bank of
Cincinnati ("FHLB-Cincinnati"). The deposit accounts of the
Association are insured by the FDIC up to the applicable
limits; and no proceedings for the termination or revocation
of such insurance are pending or, to the best knowledge of the
Company or the Association, threatened. Upon consummation of
the Conversion, the liquidation account for the benefit of
Eligible Account Holders will be duly established in
accordance with the requirements of the Conversion
Regulations.
(j) The Company, the Association and its subsidiaries have good
and marketable title to all real property and good title to
all other assets material to the business of the Company and
the Association, taken as a whole, and to those properties and
assets described in the Registration Statement and Prospectus
as owned by them, free and clear of all liens, charges,
encumbrances or restrictions, except such as are described in
the Registration Statement and Prospectus, or are not material
to the business of the Company and the Association, taken as a
whole; and all of the leases and subleases material to the
business of the Company and the Association, taken as a whole,
under which the Company or the Association hold properties,
including those described in the Registration Statement and
Prospectus, are in full force and effect.
(k) The Company and the Association have received an opinion of
their special counsel, Vorys, Sater, Seymour and Pease with
respect to the federal and Ohio income tax consequences of the
Conversion; all material aspects of the opinion of Vorys,
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Sater, Seymour and Pease are accurately summarized in the
Registration Statement and will be accurately summarized in
the Prospectus; and further represent and warrant that the
facts upon which such opinion is based are truthful, accurate
and complete.
(l) The Company and the Association have all such power,
authority, authorizations, approvals and orders as may be
required to enter into this Agreement, to carry out the
provisions and conditions hereof and to issue and sell the
Shares to be sold by the Company as provided herein and as
described in the Prospectus except approval or confirmation by
the OTS of the final appraisal of the Association. The
consummation of the Conversion, the execution, delivery and
performance of this Agreement and the consummation of the
transactions herein contemplated have been duly and validly
authorized by all necessary corporate action on the part of
the Company and the Association and this Agreement has been
validly executed and delivered by the Company and the
Association and is the valid, legal and binding agreement of
the Company and the Association enforceable in accordance with
its terms (except as the enforceability thereof may be limited
by bankruptcy, insolvency, moratorium, reorganization or
similar laws relating to or affecting the enforcement of
creditors' rights generally or the rights of creditors of
savings and loan holding companies, the accounts of whose
subsidiaries are insured by the FDIC or by general equity
principles regardless of whether such enforceability is
considered in a proceeding in equity or at law, and except to
the extent if any, that the provisions of Sections 8 and 9
hereof may be unenforceable as against public policy).
(m) The Company and the Association are not in violation of any
directive received from the OTS, the Division, the FDIC, or
any other agency to make any material change in the method of
conducting their businesses so as to comply in all material
respects with all applicable statutes and regulations
(including, without limitation,
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regulations, decisions, directives and orders of the OTS, the
Division and the FDIC) and, except as may be set forth in the
Registration Statement and the Prospectus, there is no suit or
proceeding or charge or action before or by any court,
regulatory authority or governmental agency or body, pending
or, to the knowledge of the Company or the Association,
threatened, which might materially and adversely affect the
Conversion, the performance of this Agreement or the
consummation of the transactions contemplated in the Plan and
as described in the Registration Statement and the Prospectus
or which might result in any material adverse change in the
condition (financial or otherwise), earnings, capital or
properties of the Company or the Association, or which would
materially affect their properties and assets.
(n) The financial statements, schedules and notes related thereto
which are included in the Prospectus fairly present the
consolidated balance sheet, income statement, statement of
changes in equity and cash flows of the Association at the
respective dates indicated and for the respective periods
covered thereby and comply as to form in all material respects
with the applicable accounting requirements of Title 12 of the
Code of Federal Regulations and generally accepted accounting
principles (including those requiring the recording of certain
assets at their current market value). Such financial
statements, schedules and notes related thereto have been
prepared in accordance with generally accepted accounting
principles consistently applied through the periods involved,
present fairly in all material respects the information
required to be stated therein and are consistent with the most
recent financial statements and other reports filed by the
Association with the OTS and the Division. The other
financial, statistical and pro forma information and related
notes included in the Prospectus present fairly the
information shown therein on a basis consistent with the
audited and unaudited financial statements of the Association
included in the Prospectus, and as to
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the pro forma adjustments, the adjustments made therein have
been properly applied on the basis described therein.
(o) Since the respective dates as of which information is given in
the Registration Statement including the Prospectus: (i) there
has not been any material adverse change, financial or
otherwise, in the condition of the Company or the Association
and its subsidiaries considered as one enterprise, or in the
earnings, capital or properties of the Company or the
Association, whether or not arising in the ordinary course of
business; (ii) there has not been any material increase in the
long-term debt of the Association or in the principal amount
of the Association's assets which are classified by the
Association as substandard, doubtful or loss or in loans past
due 90 days or more or real estate acquired by foreclosure, by
deed-in-lieu of foreclosure or deemed in-substance foreclosure
or any material decrease in retained earnings or total assets
of the Association nor has the Company or the Association
issued any securities (other than in connection with the
incorporation of the Company) or incurred any liability or
obligation for borrowing other than in the ordinary course of
business; (iii) there have not been any material transactions
entered into by the Company or the Association; (iv) there has
not been any material adverse change in the aggregate dollar
amount of the Association's deposits or its consolidated net
worth or spread; (v) there has been no material adverse change
in the Company's or the Association's relationship with its
insurance carriers, including, without limitation,
cancellation or other termination of the Company's or the
Association's fidelity bond or any other type of insurance
coverage; (vi) except as disclosed in the Prospectus there has
been no material change in management of the Company or the
Association, neither of which has any material undisclosed
liability of any kind, contingent or otherwise; (vii) the
Company or the Association has not sustained any material loss
or interference with its respective business or
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properties from fire, flood, windstorm, earthquake, accident
or other calamity, whether or not covered by insurance; (viii)
the Company or the Association is not in default in the
payment of principal or interest on any outstanding debt
obligations; (ix) the capitalization, liabilities, assets,
properties and business of the Company and the Association
conform in all material respects to the descriptions thereof
contained in the Prospectus; and (x) neither the Company, the
Association nor its wholly owned subsidiary has any material
contingent liabilities, except as set forth in the Prospectus.
All documents made available to or delivered or to be made
available to or delivered by the Association or the Company or
their representatives in connection with the issuance and sale
of the Shares, including records of account holders,
depositors, borrowers and other members of the Association, or
in connection with the Agent's exercise of due diligence,
except for those documents which were prepared by parties
other than the Association, the Company or their
representatives, to the best knowledge of the Association and
the Company, were on the dates on which they were delivered,
or will be on the dates on which they are to be delivered,
true, complete and correct in all material respects.
(p) As of the date hereof and as of the Closing Date, neither the
Company, the Association nor its subsidiary is (i) in
violation of its articles of incorporation or code of
regulations or charter or bylaws, respectively (and the
Association will not be in violation of its charter or bylaws
in capital stock form upon consummation of the Conversion), or
(ii) in default in the performance or observance of any
material obligation, agreement, covenant, or condition
contained in any material contract, lease, loan agreement,
indenture or other instrument to which it is a party or by
which it or any of its property may be bound; the consummation
of the Conversion, the execution, delivery and performance of
this Agreement and the consummation of the transactions herein
contemplated have been duly and validly authorized by all
necessary corporate action on
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the part of the Company and the Association and this Agreement
has been validly executed and delivered by the Company and the
Association and is a valid, legal and binding Agreement of the
Company and the Association enforceable in accordance with its
terms, except as the enforceability thereof may be limited by
(i) bankruptcy, insolvency, reorganization, moratorium,
conservatorship, receivership or other similar laws now or
hereafter in effect relating to or affecting the enforcement
of creditors' rights generally or the rights of creditors of
federal savings institutions, (ii) general equitable
principles, (iii) laws relating to the safety and soundness of
insured depository institutions, and (iv) applicable law or
public policy with respect to the indemnification and/or
contribution provisions contained herein, and except that no
representation or warranty need be made as to the effect or
availability of equitable remedies or injunctive relief
(regardless of whether such enforceability is considered in a
proceeding in equity or at law). The consummation of the
transactions herein contemplated will not: (i) conflict with
or constitute a breach of, or default under, or result in the
creation of any material lien, charge or encumbrance (with the
exception of the liquidation account established in the
Conversion) upon any of the assets of the Company or the
Association pursuant to the articles of incorporation and code
of regulations of the Company or the charter and bylaws of the
Association (in either mutual or capital stock form), or any
material contract, lease or other instrument to which the
Company or the Association has a beneficial interest, or any
applicable law, rule, regulation or order; (ii) violate any
authorization, approval, judgement, decree, order, statute,
rule or regulation applicable to the Company or the
Association, except for such violations which would not have a
material adverse effect on the financial condition and results
of operations of the Company and the Association on a
consolidated basis; or (iii) with the exception of the
liquidation account established in the Conversion, result in
the creation of any material
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lien, charge or encumbrance upon any property of the Company
or the Association.
(q) No default exists, and no event has occurred which with notice
or lapse of time, or both, would constitute a default, on the
part of the Company, the Association or its subsidiary in the
due performance and observance of any term, covenant or
condition of any indenture, mortgage, deed of trust, note,
bank loan or credit agreement or any other instrument or
agreement to which the Company or the Association or its
subsidiary is a party or by which any of them or any of their
property is bound or affected, except such defaults which
would not have a material adverse affect on the financial
condition or results of operations of the Company, the
Association and its subsidiary on a consolidated basis; such
agreements are in full force and effect; and no other party to
any such agreements has instituted or, to the best knowledge
of the Company, the Association or its subsidiary, threatened
any action or proceeding wherein the Company, the Association
or its subsidiary would or might be alleged to be in default
thereunder.
(r) Upon consummation of the Conversion, the authorized, issued
and outstanding equity capital of the Company will be within
the range set forth in the Prospectus under the caption
"Capitalization," and no Shares have been or will be issued
and outstanding prior to the Closing Date (other than in
connection with the incorporation of the Company); the Shares
will have been duly and validly authorized for issuance and,
when issued and delivered by the Company pursuant to the Plan
against payment of the consideration calculated as set forth
in the Plan and in the Prospectus, will be duly and validly
issued, fully paid and non-assessable, except for shares
purchased by the ESOP with funds borrowed from the Company to
the extent payment therefor in cash has not been received by
the Company; except to the extent that subscription rights and
priorities pursuant thereto exist pursuant to the Plan, no
preemptive rights exist with respect to
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the Shares; and the terms and provisions of the Shares will
conform in all material respects to the description thereof
contained in the Registration Statement and the Prospectus. To
the best knowledge of the Company and the Association, upon
the issuance of the Shares, good title to the Shares will be
transferred from the Company to the purchasers thereof against
payment therefor, subject to such claims as may be asserted
against the purchasers thereof by third-party claimants.
(s) No approval of any regulatory or supervisory or other public
authority is required in connection with the execution and
delivery of this Agreement or the issuance of the Shares,
except for the approval of the Commission, the Division, the
OTS, and any necessary qualification, notification,
registration or exemption under the securities or blue sky
laws of the various states in which the Shares are to be
offered, and except as may be required under the rules and
regulations of the NASD and/or The Nasdaq Stock Market
("Nasdaq").
(t) S.R. Snodgrass, A.C., which has certified the consolidated
audited financial statements and schedules of the Association
included in the Prospectus, has advised the Company and the
Association in writing that they are, with respect to the
Company and the Association, independent public accountants
within the meaning of the Code of Professional Ethics of the
American Institute of Certified Public Accountants and Title
12 of the Code of Federal Regulations and Section 571.2(c)(3).
(u) RP Financial, which has prepared the Association's Conversion
Valuation Appraisal Report as of _________ _, 1997 (as amended
or supplemented, if so amended or supplemented) (the
"Appraisal"), has advised the Company in writing that it is
independent of the Company and the Association within the
meaning of the Conversion Regulations.
(v) The Company, the Association and its subsidiary have timely
filed all required federal, state and local tax returns; the
Company, the Association
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and its subsidiary have paid all taxes that have become due
and payable in respect of such returns, except where permitted
to be extended, have made adequate reserves for similar future
tax liabilities and no deficiency has been asserted with
respect thereto by any taxing authority.
(w) The Association is in compliance in all material respects with
the applicable financial record-keeping and reporting
requirements of the Currency and Foreign Transactions
Reporting Act of 1970, as amended, and the regulations and
rules thereunder.
(x) To the knowledge of the Company and the Association, neither
the Company, the Association nor employees of the Company or
the Association have made any payment of funds of the Company
or the Association as a loan for the purchase of the Shares or
made any other payment of funds prohibited by law, and no
funds have been set aside to be used for any payment
prohibited by law.
(y) Prior to the Conversion, neither the Company nor the
Association has: (i) issued any securities within the last 18
months (except for notes to evidence other bank loans and
reverse repurchase agreements or other liabilities in the
ordinary course of business or as described in the Prospectus,
and except for any shares issued in connection with the
incorporation of the Company); (ii) had any material dealings
within the 12 months prior to the date hereof with any member
of the NASD, or any person related to or associated with such
member, other than discussions and meetings relating to the
proposed Offering and routine purchases and sales of United
States government and agency securities; (iii) entered into a
financial or management consulting agreement except as
contemplated hereunder; and (iv) engaged any intermediary
between the Agent and the Company and the Association in
connection with the offering of the Shares, and no person is
being compensated in any manner for such service. Appropriate
arrangements have been made for
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placing the funds received from subscriptions for Shares in a
special interest-bearing account with the Association until
all Shares are sold and paid for, with provision for refund to
the purchasers in the event that the Conversion is not
completed for whatever reason or for delivery to the Company
if all Shares are sold.
(z) The Company and the Association have not relied upon the Agent
or its legal counsel or other advisors for any legal, tax or
accounting advice in connection with the Conversion.
(aa) The Company is not required to be registered under the
Investment Company Act of 1940, as amended.
(bb) Any certificates signed by an officer of the Company or the
Association pursuant to the conditions of this Agreement and
delivered to the Agent or their counsel that refers to this
Agreement shall be deemed to be a representation and warranty
by the Company or the Association to the Agent as to the
matters covered thereby with the same effect as if such
representation and warranty were set forth herein.
SECTION 5. REPRESENTATIONS AND WARRANTIES.
------------------------------
KBW represents and warrants to the Company and the Association that:
(i) it is a corporation and is validly existing in good
standing under the laws of the State of New York and licensed to
conduct business in the State of Ohio and that Webb is an
unincorporated division thereof with full power and authority to
provide the services to be furnished to the Association and the Company
hereunder.
(ii) The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby have been duly and
validly authorized by all necessary action on the part of the Agent,
and this Agreement has been duly and validly executed and delivered by
the Agent and is a legal, valid and binding agreement of the Agent,
enforceable in accordance with its terms.
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(iii) Each of the Agent and its employees, agent and
representatives who shall perform any of the services hereunder shall
be duly authorized and empowered, and shall have all licenses,
approvals and permits necessary to perform such services.
(iv) The execution and delivery of this Agreement by the
Agent, the consummation of the transactions contemplated hereby and
compliance with the terms and provisions hereof will not conflict with,
or result in a breach of, any of the terms, provisions or conditions
of, or constitute a default (or an event which with notice or lapse of
time or both would constitute a default) under, the articles of
incorporation of the Agent or any agreement, indenture or other
instrument to which the Agent is a party or by which it or its property
is bound.
(v) No approval of any regulatory or supervisory or other
public authority is required in connection with the Agent's execution
and delivery of this Agreement, except as may have been received.
(vi) There is no suit or proceeding or charge or action before
or by any court, regulatory authority or government agency or body or,
to the knowledge of the Agent, pending or threatened, which might
materially adversely affect the Agent's performance of this Agreement.
SECTION 5.L COVENANTS OF THE COMPANY AND THE ASSOCIATION. The Company
and the Association hereby jointly and severally covenant with KBW as follows:
(a) The Company will not, at any time after the date the
Registration Statement is declared effective, file any
amendment or supplement to the Registration Statement without
providing the Agent and its counsel an opportunity to review
such amendment or supplement or file any amendment or
supplement to which amendment or supplement the Agent or its
counsel shall reasonably object.
(b) The Association will not, at any time after the Conversion
Application is approved by the OTS,
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file any amendment or supplement to such Conversion
Application without providing the Agent and its counsel an
opportunity to review such amendment or supplement or file any
amendment or supplement to which amendment or supplement the
Agent or its counsel shall reasonably object.
(c) The Company will not, at any time before the Holding Company
Application is approved by the OTS, file any amendment or
supplement to such Holding Company Application without
providing the Agent and its counsel an opportunity to review
the nonconfidential portions of such amendment or supplement
or file any amendment or supplement to which amendment or
supplement the Agent or its counsel shall reasonably object.
(d) The Company and the Association will use their best efforts to
cause any post-effective amendment to the Registration
Statement to be declared effective by the Commission and any
post-effective amendment to the Conversion Application to be
approved by the OTS and will immediately upon receipt of any
information concerning the events listed below notify the
Agent: (i) when the Registration Statement, as amended, has
become effective; (ii) when the Conversion Application, as
amended, has been approved by the OTS; (iii) any comments from
the Commission, the OTS or any other governmental entity with
respect to the Conversion or the transactions contemplated by
this Agreement; (iv) of the request by the Commission, the OTS
or any other governmental entity for any amendment or
supplement to the Registration Statement, the Conversion
Application or for additional information; (v) of the issuance
by the Commission, the OTS or any other governmental entity of
any order or other action suspending the Offering or the use
of the Registration Statement or the Prospectus or any other
filing of the Company or the Association under the Conversion
Regulations, or other applicable law, or the threat of any
such action; (vi) the issuance by the Commission, the OTS or
any authority of any stop order suspending the effectiveness
of the Registration Statement or of
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the initiation or threat of initiation or threat of any
proceedings for that purpose; or (vii) of the occurrence of
any event mentioned in paragraph (h) below. The Company and
the Association will make every reasonable effort (i) to
prevent the issuance by the Commission, the OTS or any state
authority of any such order and, if any such order shall at
any time be issued, (ii) to obtain the lifting thereof at the
earliest possible time.
(e) The Company and the Association will deliver to the Agent and
to its counsel two conformed copies of the Registration
Statement, the Conversion Application and the Holding Company
Application, as originally filed and of each amendment or
supplement thereto, including all exhibits. Further, the
Company and the Association will deliver such additional
copies of the foregoing documents to counsel to the Agent as
may be required for any NASD filings.
(f) The Company and the Association will furnish to the Agent,
from time to time during the period when the Prospectus (or
any later prospectus related to this offering) is required to
be delivered under the 1933 Act or the Securities Exchange Act
of 1934 (the "1934 Act"), such number of copies of such
Prospectus (as amended or supplemented) as the Agent may
reasonably request for the purposes contemplated by the 1933
Act, the 1933 Act Regulations, the 1934 Act or the rules and
regulations promulgated under the 1934 Act (the "1934 Act
Regulations"). The Company authorizes the Agent to use the
Prospectus (as amended or supplemented, if amended or
supplemented) in any lawful manner contemplated by the Plan in
connection with the sale of the Shares by the Agent.
(g) The Company and the Association will comply with any and all
material terms, conditions, requirements and provisions with
respect to the Conversion and the transactions contemplated
thereby imposed by the Commission, the Division, the OTS or
the Conversion Regulations, and by the 1933 Act, the 1933 Act
Regulations, the 1934 Act
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and the 1934 Act Regulations to be complied with prior to or
subsequent to the Closing Date and when the Prospectus is
required to be delivered, and during such time period the
Company and the Association will comply, at their own expense,
with all material requirements imposed upon them by the
Commission, the Division, the OTS or the Conversion
Regulations, and by the 1933 Act, the 1933 Act Regulations,
the 1934 Act and the 1934 Act Regulations, including, without
limitation, Rule 10b-5 under the 1934 Act, in each case as
from time to time in force, so far as necessary to permit the
continuance of sales or dealing in the Common Shares during
such period in accordance with the provisions hereof and the
Prospectus.
(h) If, at any time during the period when the Prospectus relating
to the Shares is required to be delivered, any event relating
to or affecting the Company, the Association or its subsidiary
shall occur, as a result of which it is necessary or
appropriate, in the opinion of counsel for the Company and the
Association or in the reasonable opinion of the Agent's
counsel, to amend or supplement the Registration Statement or
Prospectus in order to make the Registration Statement or
Prospectus not misleading in light of the circumstances
existing at the time the Prospectus is delivered to a
purchaser, the Company and the Association will immediately so
inform the Agent and prepare and file, at their own expense,
with the Commission, the Division and the OTS and furnish to
the Agent a reasonable number of copies of an amendment or
amendments of, or a supplement or supplements to, the
Registration Statement or Prospectus (in form and substance
reasonably satisfactory to the Agent and its counsel after a
reasonable time for review) which will amend or supplement the
Registration Statement or Prospectus so that as amended or
supplemented it will not contain an untrue statement of a
material fact or omit to state a material fact necessary in
order to make the statements therein, in light of the
circumstances existing at the time the Prospectus is delivered
to a purchaser, not misleading. For the purpose
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of this Agreement, the Company and the Association each will
timely furnish to the Agent such information with respect to
itself as the Agent may from time to time reasonably request.
(i) The Company and the Association will take all necessary
actions, in cooperating with the Agent, and furnish to
whomever the Agent may direct, such information as may be
required to qualify or register the Shares for offering and
sale by the Company or to exempt such Shares from
registration, or to exempt the Company as a broker-dealer and
its officers, directors and employees as broker-dealers or
agents under the applicable securities or blue sky laws of
such jurisdictions in which the Shares are required under the
Conversion Regulations to be sold or as the Agent and the
Company and the Association may reasonably agree upon;
provided, however, that the Company shall not be obligated to
file any general consent to service of process, to qualify to
do business in any jurisdiction in which it is not so
qualified, or to register its directors or officers as
brokers, dealers, salesmen or agents in any jurisdiction. In
each jurisdiction where any of the Shares shall have been
qualified or registered as above provided, the Company will
make and file such statements and reports in each fiscal
period as are or may be required by the laws of such
jurisdiction.
(j) The liquidation account for the benefit of Eligible Account
Holders and Supplemental Eligible Account Holders will be duly
established and maintained in accordance with the requirements
of the OTS, and such Eligible Account Holders and Supplemental
Eligible Account Holders who continue to maintain their
savings accounts in the Association 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
the Common Shares in the event of a complete liquidation of
the Association.
(k) The Company and the Association will not sell or issue,
contract to sell or otherwise dispose of,
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for a period of 90 days after the Closing Date, without the
Agent's prior written consent, any common shares other than
the Shares or other than in connection with any plan or
arrangement described in the Prospectus, including existing
stock benefit plans.
(l) The Company shall register its Common Shares under Section
12(g) of the 1934 Act concurrently with the Offering pursuant
to the Plan and shall request that such registration be
effective prior to or upon completion of the Conversion. The
Company shall maintain the effectiveness of such registration
for not less than three years or such shorter period as may be
required by the OTS.
(m) During the period during which the Company's Common Shares are
registered under the 1934 Act or for three (3) years from the
date hereof, whichever period is greater, the Company will
furnish to its shareholders as soon as practicable after the
end of each fiscal year an annual report of the Company
(including a consolidated balance sheet and statements of
consolidated income, shareholders' equity and cash flows of
the Company and its subsidiaries as at the end of and for such
year, certified by independent public accountants in
accordance with Regulation S-X under the 1933 Act and the 1934
Act).
(n) During the period of three years from the date hereof, the
Company will furnish to the Agent: (i) as soon as practicable
after such information is publicly available, a copy of each
report of the Company furnished to or filed with the
Commission under the 1934 Act or any national securities
exchange or system on which any class of securities of the
Company is listed or quoted (including, but not limited to,
reports on Forms 10-K, 10-Q and 8-K and all proxy statements
and annual reports to stockholders), (ii) a copy of each other
non-confidential report of the Company mailed to its
stockholders or filed with the Commission, the OTS or any
other supervisory or regulatory authority or any national
securities exchange or system on which any class of
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securities of the Company is listed or quoted, each press
release and material news items and additional documents and
information with respect to the Company or the Association as
the Agent may reasonably request; and (iii) from time to time,
such other nonconfidential information concerning the Company
or the Association as the Agent may reasonably request.
(o) The Company and the Association will use the net proceeds from
the sale of the Shares in the manner set forth in the
Prospectus under the caption "Use of Proceeds."
(p) Other than as permitted by the Conversion Regulations, the
HOLA, the 1933 Act, the 1933 Act Regulations, and the laws of
any state in which the Shares are registered or qualified for
sale or exempt from registration, neither the Company nor the
Association will distribute any prospectus, offering circular
or other offering material in connection with the offer and
sale of the Shares.
(q) The Company will use its best efforts to (i) encourage and
assist a market maker to establish and maintain a market for
the Shares and (ii) list and maintain quotation of the Shares
on a national or regional securities exchange or on Nasdaq
effective on or prior to the Closing Date.
(r) The Association will maintain appropriate arrangements for
depositing all funds received from persons mailing
subscriptions for or orders to purchase Shares in the Offering
on an interest-bearing basis at the rate described in the
Prospectus until the Closing Date and satisfaction of all
conditions precedent to the release of the Association's
obligation to refund payments received from persons
subscribing for or ordering Shares in the Offering in
accordance with the Plan and as described in the Prospectus or
until refunds of such funds have been made to the persons
entitled thereto or withdrawal authorizations canceled in
accordance with the Plan and as described in the Prospectus.
The Association will maintain such records of all
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funds received to permit the funds of each subscriber to be
separately insured by the FDIC (to the maximum extent
allowable) and to enable the Association to make the
appropriate refunds of such funds in the event that such
refunds are required to be made in accordance with the Plan
and as described in the Prospectus.
(s) The Company will promptly take all necessary action to
register as a savings and loan holding company under the HOLA.
(t) The Company and the Association will take such actions and
furnish such information as are reasonably requested by the
Agent in order for the Agent to ensure compliance with the
NASD's "Interpretation Relating to Free Riding and
Withholding."
(u) Neither the Company nor the Association will amend the Plan of
Conversion without notifying the Agent prior thereto.
(v) The Company shall assist the Agent, if necessary, in
connection with the allocation of the Shares in the event of
an oversubscription and shall provide the Agent with any
information necessary to assist the Company in allocating the
Shares in such event and such information shall be accurate
and reliable.
(w) Prior to the Closing Date, the Company and the Association
will inform the Agent of any event or circumstances of which
it is aware as a result of which the Registration Statement
and/or Prospectus, as then amended or supplemented, would
contain an untrue statement of a material fact or omit to
state a material fact necessary in order to make the
statements therein not misleading.
(x) Subsequent to the date the Registration Statement is declared
effective by the Commission and prior to the Closing Date,
except as otherwise may be indicated or contemplated therein
or set forth in an amendment or supplement thereto, neither
the Company nor the Association will have: (i) issued
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any securities or incurred any liability or obligation, direct
or contingent, for borrowed money, except borrowings from the
same or similar sources indicated in the Prospectus in the
ordinary course of its business, or (ii) entered into any
transaction which is material in light of the business and
properties of the Company and the Association, taken as a
whole.
(y) The facts and representations provided to Vorys, Sater,
Seymour and Pease by the Association and the Company and upon
which Vorys, Sater, Seymour and Pease will base its opinion
under Section 7(c)(1) are and will be truthful, accurate and
complete.
SECTION 6. PAYMENT OF EXPENSES. Whether or not the Conversion is
completed or the sale of the Shares by the Company is consummated, the Company
and the Association jointly and severally agree to pay or reimburse the Agent
for: (a) all filing fees in connection with all filings related to the Offering
with the NASD; (b) any stock issue or transfer taxes which may be payable with
respect to the sale of the Shares; (c) all reasonable expenses of the
Conversion, including but not limited to the Company's and the Association's,
and the Agency's attorneys' fees and expenses, blue sky fees, transfer agent,
registrar and other agent charges, fees relating to auditing and accounting or
other advisors and costs of printing all documents necessary in connection with
the Conversion; provided, however, there will be no out-of-pocket expenses
charged by the Agent for expenses such as travel, lodging and meals. In the
event the Company is unable to sell a minimum of 573,750 Shares or the
Conversion is terminated or otherwise abandoned, the Company and the Association
shall promptly reimburse the Agent in accordance with Section 2 hereof.
SECTION 7. CONDITIONS TO THE AGENT'S OBLIGATIONS. The obligations of
the Agent hereunder, as to the Shares to be delivered at the Closing Date, are
subject, to the extent not waived in writing by the Agent, to the condition that
all representations and warranties of the Company and the Association herein
are, at and as of the commencement of the Offering and at and as of the Closing
Date, true and correct in all material respects, the condition that the Company
and the Association shall have performed all of their obligations hereunder to
be
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performed on or before such dates, and to the following
further conditions:
(a) At the Closing Date, the Company and the Association shall
have conducted the Conversion in all material respects in
accordance with the Plan, the Conversion Regulations, and all
other applicable laws, regulations, decisions and orders,
including all terms, conditions, requirements and provisions
precedent to the Conversion imposed upon them by the OTS.
(b) The Registration Statement shall have been declared effective
by the Commission and the Conversion Application approved by
the OTS and the Division not later than 5:30 p.m. on the date
of this Agreement, or with the Agent's consent at a later time
and date; and at the Closing Date, no stop order suspending
the effectiveness of the Registration Statement shall have
been issued under the 1933 Act or proceedings therefore
initiated or threatened by the Commission or any state
authority, and no order or other action suspending the
authorization of the Prospectus or the consummation of the
Conversion shall have been issued or proceedings therefore
initiated or, to the Company's or the Association's knowledge,
threatened by the Commission, the OTS, the FDIC, or any state
authority.
(c) At the Closing Date, the Agent shall have received:
(1) The favorable opinion, dated as of the Closing Date and
addressed to the Agent and for its benefit, of Vorys, Sater,
Seymour and Pease, special counsel for the Company and the
Association, in form and substance to the effect that:
(i) The Company has been duly incorporated
and is validly existing as a corporation under the
laws of the State of Ohio.
(ii) The Company has corporate power and
authority to own, lease and operate its properties
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and to conduct its business as described in the
Registration Statement and the Prospectus.
(iii) The Association is a validly existing
Ohio savings and loan association in mutual form and
immediately following the completion of the
Conversion will be a validly existing Ohio savings
and loan association in capital stock form of
organization, in both instances duly authorized to
conduct its business and own its property as
described in the Registration Statement and the
Prospectus. All of the outstanding capital stock of
the Association upon completion of the Conversion
will be duly authorized and, upon payment therefor,
will be validly issued, fully paid and non-assessable
and will be owned by the Company, to such counsel's
Actual Knowledge, free and clear of any liens,
encumbrances, claims or other restrictions.
(iv) To such counsel's Actual Knowledge, the
Association has one subsidiary, Trailway Financial,
Inc., which is duly incorporated and validly existing
as a corporation in good standing under the laws of
the State of Ohio, and which has full corporate power
and authority to own its own properties and conduct
its business as described in the Prospectus. To such
counsel's Actual Knowledge, the subsidiary holds all
licenses, certificates and permits from governmental
authorities necessary for the conduct of its business
as described in the Prospectus except where the
failure to hold such licenses, certificates or
permits would not have a material adverse effect on
the business, assets or financial condition of the
Association on a consolidated basis; and such
subsidiary is not in material violation of its
articles of incorporation or bylaws. To such
counsel's Actual Knowledge, all of the outstanding
stock of the subsidiary has been duly authorized and
is validly issued, fully paid and nonassessable, and
all such stock is owned directly by the Association,
free and clear of any liens, encumbrances, claims or
other restrictions.
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(v) The Association is a member of the
FHLB-Cincinnati. The deposit accounts of the
Association are insured by the FDIC up to the maximum
amount allowed under law and no proceedings for the
termination or revocation of such insurance are
pending or, to such counsel's Actual Knowledge,
threatened; the description of the liquidation
account as set forth in the Prospectus under the
captions "The Conversion-Liquidation Account," to the
extent that such information constitutes matters of
law and legal conclusions, has been reviewed by such
counsel and is accurately described in all material
respects.
(vi) Immediately following the consummation
of the Conversion, the authorized, issued and
outstanding capital stock of the Company will be
within the range set forth in the Prospectus under
the caption "Capitalization," and, except for shares
issued upon incorporation of the Company, no Common
Shares have been issued prior to the Closing Date; at
the time of the Conversion, the Shares subscribed for
pursuant to the Offering will have been duly and
validly authorized for issuance, and when issued and
delivered by the Company pursuant to the Plan against
payment of the consideration calculated as set forth
in the Plan and Prospectus, will be duly and validly
issued and fully paid and non-assessable, except for
shares purchased by the ESOP with funds borrowed from
the Company to the extent payment therefor in cash
has not been received by the Company; except to the
extent that subscription rights and priorities
pursuant thereto exist pursuant to the Plan, the
issuance of the Shares is not subject to preemptive
rights and the terms and provisions of the Shares
conform in all material respects to the description
thereof contained in the Prospectus. To such
counsel's Actual Knowledge, upon the issuance of the
Shares, good title to the Shares will be transferred
from the Company to the purchasers thereof against
payment therefor, subject to such claims as may be
asserted against the purchasers thereof by
third-party claimants.
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(vii) The Association and the Company have
full corporate power and authority to enter into the
Agreement and to consummate the transactions
contemplated thereby and by the Plan of Conversion.
The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby
have been duly and validly authorized by all
necessary action on the part of the Company and the
Association; and this Agreement is a valid and
binding obligation of the Company and the
Association, enforceable against the Company and the
Association in accordance with its terms, except as
the enforceability thereof may be limited by (i)
bankruptcy, insolvency, reorganization, moratorium,
conservatorship, receivership or other similar laws
now or hereafter in effect relating to or affecting
the enforcement of creditors' rights generally or the
rights of creditors of federal savings institutions,
(ii) general equitable principles, (iii) laws
relating to the safety and soundness of insured
depository institutions, and (iv) applicable law or
public policy with respect to the indemnification
and/or contribution provisions contained herein,
including without limitations the provision of
Sections 23A and 23B of the Federal Reserve Act and
except that no opinion need to be expressed as to the
effect or availability of equitable remedies or
injunctive relief (regardless of whether such
enforceability is considered in a proceeding in
equity or at law).
(viii) The Conversion Application has been
approved by the Division and the OTS and the
Prospectus has been authorized for use by the OTS.
The OTS has approved the Holding Company Application
and the purchase by the Company of all of the issued
and outstanding capital stock of the Association and
no action has been taken, and to such counsel's
Actual Knowledge, none is pending or threatened, to
revoke any such authorization or approval.
(ix) The Plan has been duly adopted by the
required vote of the directors of the Company and
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the Association, and based upon the certificate of
the inspectors of election, by the members of the
Association.
(x) Subject to the satisfaction of the
conditions to the OTS' approval of the Conversion, no
further approval, registration, authorization,
consent or other order of any federal regulatory
agency, is required in connection with the execution
and delivery of this Agreement, the issuance of the
Shares and the consummation of the Conversion, except
as may be required under the securities or blue sky
laws of various jurisdictions (as to which no opinion
need be rendered) and except as may be required under
the rules and regulations of the NASD and/or Nasdaq
(as to which no opinion need by rendered).
(xi) The Registration Statement is effective
under the 1933 Act and no stop order suspending the
effectiveness has been issued under the 1933 Act or
proceedings therefor initiated or, to such counsel's
Actual Knowledge, threatened by the Commission.
(xii) At the time the Conversion
Application, including the Prospectus contained
therein, was approved by the Division and the OTS,
the Conversion Application, including the Prospectus
contained therein, complied as to form in all
material respects with the requirements of the
Conversion Regulations, state law, federal law and
all applicable rules and regulations promulgated
thereunder (other than the financial statements, the
notes thereto, and other tabular, financial,
statistical and appraisal data included therein, as
to which no opinion need be rendered).
(xiii) At the time that the Registration
Statement became effective, (i) the Registration
Statement (as amended or supplemented, if so amended
or supplemented) (other than the financial
statements, the notes thereto, and other tabular,
financial, statistical and appraisal data included
therein, as to which no opinion need be rendered),
complied as to form in all material respects with
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the requirements of the 1933 Act and the 1933 Act Regulations, and
(ii) the Prospectus (other than the financial statements, the notes
thereto, and other tabular, financial, statistical and appraisal
data included therein, as to which no opinion need be rendered)
complied as to form in all material respects with the requirements
of the 1933 Act, the 1933 Act Regulations, the Conversion
Regulations and federal law.
(xiv) The terms and provisions of the Shares
of the Company conform, in all material respects, to
the description thereof contained in the Registration
Statement and Prospectus, and the form of certificate
used to evidence the Shares is in due and proper
form.
(xv) There are no legal or governmental
proceedings pending, or to such counsel's Actual
Knowledge, threatened which are required to be
disclosed in the Registration Statement and
Prospectus, other than those disclosed therein.
(xvi) To such counsel's Actual Knowledge,
there are no material contracts, indentures,
mortgages, loan agreements, notes, leases or other
instruments required to be described or referred to
in the Conversion Application, the Registration
Statement or the Prospectus or required to be filed
as exhibits thereto other than those described or
referred to therein or filed as exhibits thereto in
the Conversion Application, the Registration
Statement or the Prospectus. The description in the
Conversion Application, the Registration Statement
and the Prospectus of such documents and exhibits is
accurate in all material respects and fairly presents
the information required to be shown.
(xvii) The Plan complies in all material
respects with all applicable federal laws, rules,
regulations, decisions and orders including, but not
limited to, the Conversion Regulations; no order has
been issued by the Dvision, the OTS, the Commission,
the FDIC, or any other state authority to suspend the
Offering or the use of the
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Prospectus, and no action for such purposes has been
instituted or, to such counsel's Actual Knowledge,
threatened by the Division, the OTS, the Commission,
the FDIC, or any state authority and, to such
counsel's Actual Knowledge, no person has sought to
obtain regulatory or judicial review of the final
action of the OTS, approving the Plan, the Conversion
Application, the Holding Company Application or the
Prospectus.
(xviii) To such counsel's Actual Knowledge, the
Company and the Association have obtained all
material licenses, permits and other governmental
authorizations currently required for the conduct of
their businesses and all such licenses, permits and
other governmental authorizations are in full force
and effect, and the Company and the Association are
in all material respects complying therewith.
(xix) To such counsel's Actual Knowledge,
neither the Company nor the Association is in
violation of its articles of incorporation and code
of regulations or its charter and bylaws, as
appropriate or, to such counsel's Actual Knowledge,
in default or violation of any obligation, agreement,
covenant or condition contained in any contract,
indenture, mortgage, loan agreement, note, lease or
other instrument to which it is a party or by which
it or its property may be bound, except for such
defaults or violations which would not have a
material adverse impact on the financial condition or
results of operations of the Company, the Association
and its subsidiary on a consolidated basis; to such
counsel's Actual Knowledge, the execution and
delivery of this Agreement, the incurrence of the
obligations herein set forth and the consummation of
the transactions contemplated herein will not
conflict with or constitute a breach of, or default
under, or result in the creation or imposition of any
lien, charge or encumbrance upon any property or
assets of the Company or the
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Association pursuant to any material contract,
indenture, mortgage, loan agreement, note, lease or
other instrument to which the Company or the
Association is a party or by which any of them may be
bound, or to which any of the property or assets of
the Company or the Association are subject (other than
the establishment of the liquidation account); and,
such action will not result in any violation of the
provisions of the articles of incorporation or code of
regulations of the Company or the charter or bylaws of
the Association or, to such counsel's actual
knowledge, result in any violation of any applicable
federal law, act, regulation need be rendered (except
that no opinion with respect to the securities and
blue sky laws of various jurisdictions or the rules or
regulations of the NASD and/or the Nasdaq Stock
Market) or order or court order, writ, injunction or
decree.
(xx) The Company's articles of incorporation
and code of regulations comply in all materials
respects with the laws of the State of Ohio. The
Association's charter and bylaws comply in all
material respects with the laws of the State of Ohio
and the Rules and Regulations of the Division.
(xxi) To such counsel's Actual Knowledge,
neither the Company nor the Association is in
violation of any directive from the Division, the OTS
or the FDIC to make any material change in the method
of conducting its respective business.
(xxii) The information in the Prospectus
under the captions "Regulation," "The Conversion,"
"Restrictions on Acquisition of the Company and the
Association" and "Description of Authorized Shares,"
to the extent that such information constitutes
matters of law, summaries of legal matters, documents
or proceedings, or legal conclusions, has been
reviewed by such counsel and is correct in all
material respects. The description of the Conversion
process under the caption "The Conversion" in the
Prospectus has been reviewed by such counsel and
fairly describes such process in all material
respects. The discussion of statutes or regulations
described or referred to in the Prospectus are
accurate
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summaries and fairly present the information required
to be shown. The information under the caption "The
Conversion-Principal Effects of the Conversion--Tax
Consequences" has been reviewed by such counsel and
fairly describes the opinions rendered by them to the
Company and the Association with respect to such
matters.
In addition, such counsel shall state that
during the preparation of the Conversion Application,
the Registration Statement and the Prospectus, they
participated in conferences with certain officers of,
the independent public and internal accountants for,
and other representatives of the Company and the
Association, at which conferences the contents of the
Conversion Application, the Registration Statement
and the Prospectus and related matters were discussed
and, while such counsel have not confirmed the
accuracy or completeness of or otherwise verified the
information contained in the Conversion Application,
the Registration Statement or the Prospectus, and do
not assume any responsibility for such information,
based upon such conferences and a review of documents
deemed relevant for the purpose of rendering their
opinion (relying as to materiality as to factual
matters on certificates of officers and other factual
representations by the Company and the Association,
nothing has come to their attention that would lead
them to believe that the Conversion Application, the
Registration Statement, the Prospectus, or any
amendment or supplement thereto (other than the
financial statements, the notes thereto, and other
tabular, financial, statistical and appraisal data
included therein as to which no view need be
rendered) contained an untrue statement of a material
fact or omitted to state a material fact required to
be stated therein or necessary to make the statements
therein, in light of the circumstances under which
they were made, not misleading.
In giving such opinion, such counsel may
rely as to all matters of fact on certificates of
officers or directors of the Company and the
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Association and certificates of public officials. Such
counsel's opinion shall be limited to matters governed
by federal laws and by the laws of the State of Ohio.
The term "Actual Knowledge" as used herein shall have
the meaning set forth in the Legal Opinion Accord of
the American Bar Association Section of Business Law.
For purposes of such opinion, no proceedings shall be
deemed to be pending, no order or stop order shall be
deemed to be issued, and no action shall be deemed to
be instituted unless, in each case, a director or
executive officer of the Company or the Association
shall have received a copy of such proceedings, order,
stop order or action. In addition, such opinion may be
limited to present statutes, regulations and judicial
interpretations and to facts as they presently exist;
in rendering such opinion, such counsel need assume no
obligation to revise or supplement it should the
present laws be changed by legislative or regulatory
action, judicial decision or otherwise; and such
counsel need express no view, opinion or belief with
respect to whether any proposed or pending
legislation, if enacted, or any proposed or pending
regulations or policy statements issued by any
regulatory agency, whether or not promulgated pursuant
to any such legislation, would affect the validity of
the Conversion or any aspect thereof. Such counsel may
assume that any agreement is the valid and binding
obligation of any parties to such agreement other than
the Company or the Association.
(d) At the Closing Date, the Agent shall have received
the favorable opinion, dated as of the Closing Date,
of Silver, Freedman & Taff, L.L.P., the Agent's
counsel, with respect to such matters as the Agent
may reasonably require. Such opinion may rely upon
the opinions of counsel to the Company and the
Association, and as to matters of fact, upon
certificates of officers and directors of the Company
and the Association delivered pursuant hereto or as
such counsel shall reasonably request.
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(e) At the Closing Date, the Agent shall receive a
certificate of the Chief Executive Officer and the
Principal Accounting Officer of the Company and the
Association in form and substance reasonably
satisfactory to the Agent's Counsel, dated as of such
Closing Date, to the effect that: (i) they have
carefully examined the Prospectus and, in their
opinion, at the time the Prospectus became authorized
for final use, the Prospectus did not contain any
untrue statement of a material fact or omit to state a
material fact necessary in order to make the
statements therein, in light of the circumstances
under which they were made, not misleading; (ii) since
the date the Prospectus became authorized for final
use, no event has occurred which should have been set
forth in an amendment or supplement to the Prospectus
which has not been so set forth, including
specifically, but without limitation, any material
adverse change in the condition, financial or
otherwise, or in the earnings, capital, properties or
business of the Company, the Association or its
subsidiary, and the conditions set forth in this
Section 7 have been satisfied; (iii) since the
respective dates as of which information is given in
the Registration Statement and the Prospectus, there
has been no material adverse change in the condition,
financial or otherwise, or in the earnings, capital or
properties of the Company, the Association or its
subsidiary, independently, or of the Company, the
Association or its subsidiary, considered as one
enterprise, whether or not arising in the ordinary
course of business; (iv) the representations and
warranties in Section 4 are true and correct with the
same force and effect as though expressly made at and
as of the Closing Date; (v) the Company, and the
Association have complied in all material respects
with all agreements and satisfied all conditions on
their part to be performed or satisfied at or prior to
the Closing Date and will comply in all material
respects with all obligations to be satisfied by them
after the Conversion; (vi) no stop order suspending
the effectiveness of the Registration Statement has
been initiated or, to the best knowledge of the
Company or the Association,
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41
threatened by the Commission or any state authority;
(vii) no order suspending the Offering, the
Conversion, the acquisition of all of the shares of
the Association by the Company or the effectiveness of
the Prospectus has been issued and no proceedings for
that purpose are pending or, to the best knowledge of
the Company or the Association, threatened by the
Division, the OTS, the Commission, the FDIC, or any
state authority; and (viii) to the best knowledge of
the Company or the Association, no person has sought
to obtain review of the final action of the OTS
approving the Plan.
(f) Prior to and at the Closing Date: (i) in the
reasonable opinion of the Agent, there shall have been
no material adverse change in the condition, financial
or otherwise, or in the earnings or business of the
Company, the Association or its subsidiary
independently, or of the Company, the Association and
its subsidiary, considered as one enterprise, from
that as of the latest dates as of which such condition
is set forth in the Prospectus other than transactions
referred to or contemplated therein; (iii) the Company
or the Association shall not have received from the
Division, the OTS or the FDIC any direction (oral or
written) to make any material change in the method of
conducting their business with which it has not
complied (which direction, if any, shall have been
disclosed to the Agent) or which materially and
adversely would affect the business, operations or
financial condition or income of the Company and the
Association (together with its Subsidiary) taken as a
whole; (iv) the Company, the Association and its
subsidiary shall not have been in default (nor shall
an event have occurred which, with notice or lapse of
time or both, would constitute a default) under any
provision of any agreement or instrument relating to
any outstanding indebtedness; (v) no action, suit or
proceeding, at law or in equity or before or by any
federal or state commission, board or other
administrative agency, shall be pending or, to the
knowledge of the Company, the Association or its
subsidiary, threatened against
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42
the Company, the Association or its subsidiary or
affecting any of their properties wherein an
unfavorable decision, ruling or finding would
materially and adversely affect the business,
operations, financial condition or income of the
Company, the Association and its subsidiary taken as a
whole; and (vi) the Shares have been qualified or
registered for offering and sale or exempted therefrom
under the securities or blue sky laws of the
jurisdictions as the Agent shall have reasonably
requested and as agreed to by the Company and the
Association.
(g) Concurrently with the execution of this Agreement, the
Agent shall receive a letter from S.R. Snodgrass, A.C.
dated as of the date of the Prospectus and addressed
to the Agent: (i) confirming that S.R. Snodgrass, A.C.
is a firm of independent public accounts within the
meaning of Rule 101 of the Code of Professional Ethics
of the American Institute of Certified Public
Accountants and applicable regulations of the OTS and
stating in effect that in its opinion the consolidated
financial statements, schedules and related notes of
the Association as of December 31, 1996 and 1995 and
for each of the three years in the period ended
December 31, 1996, as are included in the Prospectus
and covered by their opinion included therein, comply
as to form in all material respects with the
applicable accounting requirements and related
published rules and regulations of the OTS and the
1933 Act; (ii) stating in effect that, on the basis of
certain agreed upon procedures (but not an audit in
accordance with generally accepted auditing standards)
consisting of a reading of the latest available
unaudited interim consolidated financial statements of
the Association prepared by the Association, a reading
of the minutes of the meetings of the Board of
Directors and members of the Association and
consultations with officers of the Association
responsible for financial and accounting matters,
nothing came to their attention which caused them to
believe that: (A) the unaudited financial statements
included in the Prospectus are not in conformity with
the 1933
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Act, applicable accounting requirements of the OTS and
generally accepted accounting principles applied on a
basis substantially consistent with that of the
audited financial statements included in the
Prospectus; or (B) during the period from the date of
the latest unaudited consolidated financial statements
included in the Prospectus to a specified date not
more than three business days prior to the date of the
Prospectus, except as has been described in the
Prospectus, there was any increase in borrowings,
other than normal deposit fluctuations, by the
Association; or (c) there was any decrease in the
consolidated net assets of the Association at the date
of such letter as compared with amounts shown in the
latest unaudited consolidated statement of condition
included in the Prospectus; and (iii) stating that, in
addition to the audit referred to in their opinion
included in the Prospectus and the performance of the
procedures referred to in clause (ii) of this
subsection (f), they have compared with the general
accounting records of the Association, which are
subject to the internal controls of the Association,
the accounting system and other data prepared by the
Association, directly from such accounting records, to
the extent specified in such letter, such amounts
and/or percentages set forth in the Prospectus as the
Agent may reasonably request; and they have reported
on the results of such comparisons.
(h) At the Closing Date, the Agent shall receive a letter
dated the Closing Date, addressed to the Agent,
confirming the statements made by S.R. Snodgrass,
A.C. in the letter delivered by it pursuant to
subsection (f) of this Section 7, the "specified
date" referred to in clause (ii) of subsection (f)
thereof to be a date specified in such letter, which
shall not be more than three business days prior to
the Closing Date.
(i) At the Closing Date, the Agent shall receive a letter
from RP Financial, dated the date thereof and
addressed to counsel for the Agent (i) confirming that
said firm is independent of the Company and the
Association and is experienced and
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expert in the area of corporate appraisals within the
meaning of Title 12 of the Code of Federal
Regulations, Section 563b.7(f)(1)(i), (ii) stating in
effect that the Appraisal prepared by such firm
complies in all material respects with the applicable
requirements of Title 12 of the Code of Federal
Regulations, and (iii) further stating that their
opinion of the aggregate pro forma market value of the
Company and the Association expressed in their
Appraisal dated as of _________ __, 1997, and most
recently updated, remains in effect.
(j) The Company and the Association shall not have
sustained since the date of the latest financial
statements included in the Prospectus any material
loss or interference with its business from fire,
explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or
court or governmental action, order or decree,
otherwise than as set forth or contemplated in the
Registration Statement and Prospectus and since the
respective dates as of which information is given in
the Registration Statement and Prospectus, there shall
not have been any change in the long-term debt of the
Company or the Association other than debt incurred in
relation to the purchase of Shares by the
Association's Eligible Plans, or any change, or any
development involving a prospective change, in or
affecting the general affairs, management, financial
position, stockholders' equity or results of
operations of the Company or the Association,
otherwise than as set forth or contemplated in the
Registration Statement and Prospectus, the effect of
which, in any such case described above, is in Webb's
reasonable judgment sufficiently material and adverse
as to make it impracticable or inadvisable to proceed
with the Subscription Offering or the delivery of the
Shares on the terms and in the manner contemplated in
the Prospectus.
(k) At or prior to the Closing Date, the Agent shall
receive: (i) a copy of the letter from the OTS
approving the Conversion Application and
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45
authorizing the use of the Prospectus; (ii) a copy of
the order from the Commission declaring the
Registration Statement effective; (iii) a certificate
from the Division and the OTS evidencing the existence
of the Association; (iv) certificate of good standing
from the State of Ohio evidencing the good standing of
the Company and the Association's subsidiary; (v) a
certificate from the FDIC evidencing the Association's
insurance of accounts; (vi) a certificate of the
FHLB-Cincinnati evidencing the Association's
membership thereof; (vii) a copy of the letter from
the OTS approving the Company's Holding Company
Application; and (viii) a copy of the Association's
stock charter.
(l) Subsequent to the date hereof, there shall not have
occurred any of the following: (i) a suspension or
limitation in trading in securities generally on the
New York Stock Exchange or in the over-the-counter
market, or quotations halted generally on the Nasdaq
Stock Market, or minimum or maximum prices for trading
have been fixed, or maximum ranges for prices for
securities have been required by either of such
exchanges or the NASD or by order of the Commission or
any other governmental authority; (ii) a general
moratorium on the operations of commercial banks, Ohio
savings and loan association or federal savings banks
or a general moratorium on the withdrawal of deposits
from commercial banks, Ohio savings banks or federal
savings and loan associations declared by federal or
state authorities; (iii) the engagement by the United
States in hostilities which have resulted in the
declaration, on or after the date hereof, of a
national emergency or war; or (iv) a material decline
in the price of equity or debt securities if the
effect of such a declaration or decline, in the
Agent's reasonable judgement, makes it impracticable
or inadvisable to proceed with the Offering or the
delivery of the shares on the terms and in the manner
contemplated in the Registration Statement and the
Prospectus.
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(m) At or prior to the Closing Date, counsel to the Agent
shall have been furnished with such documents and
opinions as they may reasonably require for the
purpose of enabling them to pass upon the sale of the
Shares as herein contemplated and related proceedings
or in order to evidence the occurrence or completeness
of any of the representations or warranties, or the
fulfillment of any of the conditions, herein
contained; and all proceedings taken by the Company or
the Association in connection with the Conversion and
the sale of the Shares as herein contemplated shall be
satisfactory in form and substance to Webb and its
counsel.
SECTION 8. INDEMNIFICATION.
(a) The Company and the Association jointly and severally
agree to indemnify and hold harmless the Agent, its
respective officers and directors, employees and
agents, and each person, if any, who controls the
Agent within the meaning of Section 15 of the 1933 Act
or Section 20(a) of the 1934 Act, against any and all
loss, liability, claim, damage or expense whatsoever
(including but not limited to settlement expenses),
joint or several, that the Agent or any of them may
suffer or to which the Agent and any such persons may
become subject under all applicable federal or state
laws or otherwise, and to promptly reimburse the Agent
and any such persons upon written demand for any
expense (including reasonable fees and disbursements
of counsel) incurred by the Agent or any of them in
connection with investigating, preparing or defending
any actions, proceedings or claims (whether commenced
or threatened) to the extent such losses, claims,
damages, liabilities or actions: (i) arise out of or
are based upon any untrue statement or alleged untrue
statement of a material fact contained in the
Registration Statement (or any amendment or supplement
thereto), preliminary or final Prospectus (or any
amendment or supplement thereto), the
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Conversion Application (or any amendment or supplement
thereto), the Holding Company Application or any
instrument or document executed by the Company or the
Association or based upon written information supplied
by the Company or the Association filed in any state
or jurisdiction to register or qualify any or all of
the Shares or to claim an exemption therefrom, or
provided to any state or jurisdiction to exempt the
Company as a broker-dealer or its officers, directors
and employees as broker-dealers or agent, under the
securities laws thereof (collectively, the "Blue Sky
Application"), or any document, advertisement, oral
statement or communication ("Sales Information")
prepared, made or executed by or on behalf of the
Company or the Association with their consent or based
upon written or oral information furnished by or on
behalf of the Company or the Association, whether or
not filed in any jurisdiction, in order to qualify or
register the Shares or to claim an exemption therefrom
under the securities laws thereof; (ii) arise out of
or are based upon the omission or alleged omission to
state in any of the foregoing documents or
information, a material fact required to be stated
therein or necessary to make the statements therein,
in light of the circumstances under which they were
made, not misleading; or (iii) arise from any theory
of liability whatsoever relating to or arising from or
based upon the Registration Statement (or any
amendment or supplement thereto), preliminary or final
Prospectus (or any amendment or supplement thereto),
the Conversion Application (or any amendment or
supplement thereto), any Blue Sky Application or Sales
Information or other documentation distributed in
connection with the Conversion; provided, however,
that no indemnification is required under this
paragraph (a) to the extent such losses, claims,
damages, liabilities or actions arise out of or are
based upon any untrue material
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statement or alleged untrue material statement in, or
material omission or alleged material omission from,
the Registration Statement (or any amendment or
supplement thereto), preliminary or final Prospectus
(or any amendment or supplement thereto), the
Conversion Application, any Blue Sky Application or
Sales Information made in reliance upon and in
conformity with information furnished in writing to
the Company or the Association by the Agent or its
counsel regarding the Agent provided, that it is
agreed and understood that the only information
furnished in writing to the Company or the Association
by the Agent regarding the Agent is set forth in the
Prospectus under the caption "the Conversion--Plan of
Distribution"; and, PROVIDED FURTHER, that such
indemnification shall be to the extent permitted by
the Commissioner, the OTS, the FDIC and the Board of
Governors of the Federal Reserve.
(b) The Agent agrees to indemnify and hold harmless the
Company and the Association, their directors and
officers and each person, if any, who controls the
Company or the Association within the meaning of
Section 15 of the 1933 Act or Section 20(a) of the
1934 Act against any and all loss, liability, claim,
damage or expense whatsoever (including but not
limited to settlement expenses), joint or several,
which they, or any of them, may suffer or to which
they, or any of them may become subject under all
applicable federal and state laws or otherwise, and to
promptly reimburse the Company, the Association, and
any such persons upon written demand for any expenses
(including reasonable fees and disbursements of
counsel) incurred by them, or any of them, in
connection with investigating, preparing or defending
any actions, proceedings or claims (whether commenced
or threatened) to the extent such losses, claims,
damages, liabilities or actions: (i) arise out of or
are based upon any untrue statement or
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alleged untrue statement of a material fact contained
in the Registration Statement (or any amendment or
supplement thereto), the Conversion Application (or
any amendment or supplement thereto), the preliminary
or final Prospectus (or any amendment or supplement
thereto), any Blue Sky Application or Sales
Information, (ii) are based upon the omission or
alleged omission to state in any of the foregoing
documents a material fact required to be stated
therein or necessary to make the statements therein,
in the light of the circumstances under which they
were made, not misleading, or (iii) arise from any
theory of liability whatsoever relating to or arising
from or based upon the Registration Statement (or any
amendment or supplement thereto), preliminary or final
Prospectus (or any amendment or supplement thereto),
the Conversion Application (or any amendment or
supplement thereto), or any Blue Sky Application or
Sales Information or other documentation distributed
in connection with the Conversion; provided, however,
that the Agent's obligations under this Section 8(b)
shall exist only if and only to the extent (i) that
such untrue statement or alleged untrue statement was
made in, or such material fact or alleged material
fact was omitted from, the Registration Statement (or
any amendment or supplement thereto), the preliminary
or final Prospectus (or any amendment or supplement
thereto), the Conversion Application (or any amendment
or supplement thereto), any Blue Sky Application or
Sales Information in reliance upon and in conformity
with information furnished in writing to the Company
or the Association by the Agent or its counsel
regarding the Agent. Provided, that it is agreed and
understood that the only information furnished in
writing to the Company or the Association by the Agent
regarding the Agent is set forth in the Prospectus
under the caption "the Conversion--Plan of
Distribution."
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(c) Each indemnified party shall give prompt written
notice to each indemnifying party of any action,
proceeding, claim (whether commenced or threatened),
or suit instituted against it in respect of which
indemnity may be sought hereunder, but failure to so
notify an indemnifying party shall not relieve it from
any liability which it may have on account of this
Section 8 or otherwise. An indemnifying party may
participate at its own expense in the defense of such
action. In addition, if it so elects within a
reasonable time after receipt of such notice, an
indemnifying party, jointly with any other
indemnifying parties receiving such notice, may assume
defense of such action with counsel chosen by it and
approved by the indemnified parties that are
defendants in such action, unless such indemnified
parties reasonably object to such assumption on the
ground that there may be legal defenses available to
them that are different from or in addition to those
available to such indemnifying party. If an
indemnifying party assumes the defense of such action,
the indemnifying parties shall not be liable for any
fees and expenses of counsel for the indemnified
parties incurred thereafter in connection with such
action, proceeding or claim, other than reasonable
costs of investigation. In no event shall the
indemnifying parties be liable for the fees and
expenses of more than one separate firm of attorneys
(and any special counsel that said firm may retain)
for each indemnified party in connection with any one
action, proceeding or claim or separate but similar or
related actions, proceedings or claims in the same
jurisdiction arising out of the same general
allegations or circumstances.
(d) The agreements contained in this Section 8 and in
Section 9 hereof and the representations and
warranties of the Company and the Association set
forth in this Agreement shall remain operative and in
full
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force and effect regardless of: (i) any investigation
made by or on behalf of agent or their officers,
directors or controlling persons, agent or employees
or by or on behalf of the Company or the Association
or any officers, directors or controlling persons,
agent or employees of the Company or the Association;
(ii) delivery of and payment hereunder for the Shares;
or (iii) any termination of this Agreement.
SECTION 9. CONTRIBUTION. In order to provide for just and equitable
contribution in circumstances in which the indemnification provided for in
Section 8 is due in accordance with its terms but is for any reason held by a
court to be unavailable from the Company, the Association or the Agent, the
Company, the Association and the Agent shall contribute to the aggregate losses,
claims, damages and liabilities (including any investigation, legal and other
expenses incurred in connection with, and any amount paid in settlement of, any
action, suit or proceeding of any claims asserted, but after deducting any
contribution received by the Company, the Association or the Agent from persons
other than the other party thereto, who may also be liable for contribution) in
such proportion so that the Agent is responsible for that portion represented by
the percentage that the fees paid to the Agent pursuant to Section 2 of this
Agreement (not including expenses) bears to the gross proceeds received by the
Company from the sale of the Shares in the Offering, and the Company and the
Association shall be responsible for the balance. If, however, the allocation
provided above is not permitted by applicable law or if the indemnified party
failed to give the notice required under Section 8 above, then each indemnifying
party shall contribute to such amount paid or payable by such indemnified party
in such proportion as is appropriate to reflect not only such relative fault of
the Company and the Association on the one hand and the Agent on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities (or actions, proceedings or claims in respect
thereto), but also the relative benefits received by the Company and the
Association on the one hand and the Agent on the other from the Offering (before
deducting expenses). The relative fault shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates to
information supplied by the Company and/or the Association on the one hand or
the
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Agent on the other and the parties' relative intent, good faith, knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The Company, the Association and the Agent agree that it would not be
just and equitable if contribution pursuant to this Section 9 were determined by
pro-rata allocation or by any other method of allocation which does not take
into account the equitable considerations referred to above in this Section 9.
The amount paid or payable by an indemnified party as a result of the losses,
claims, damages or liabilities (or actions, proceedings or claims in respect
thereof) referred to above in this Section 9 shall be deemed to include any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action, proceeding or claim.
It is expressly agreed that the Agent shall not be liable for any loss,
liability, claim, damage or expense or be required to contribute any amount
which in the aggregate exceeds the amount paid (excluding reimbursable expenses)
to the Agent under this Agreement. It is understood that the above stated
limitation on the Agent's liability is essential to the Agent and that the Agent
would not have entered into this Agreement if such limitation had not been
agreed to by the parties to this Agreement. No person found guilty of any
fraudulent misrepresentation (within the meaning of Section 11(f) of the 1933
Act) shall be entitled to contribution from any person who was not found guilty
of such fraudulent misrepresentation. The obligations of the Company and the
Association under this Section 9 and under Section 8 shall be in addition to any
liability which the Company and the Association may otherwise have. For purposes
of this Section 9, each of the Agent's, the Company's or the Association's
officers and directors and each person, if any, who controls the Agent or the
Company or the Association within the meaning of the 1933 Act and the 1934 Act
shall have the same rights to contribution as the Agent, the Company or the
Association. Any party entitled to contribution, promptly after receipt of
notice of commencement of any action, suit, claim or proceeding against such
party in respect of which a claim for contribution may be made against another
party under this Section 9, will notify such party from whom contribution may be
sought, but the omission to so notify such party shall not relieve the party
from whom contribution may be sought from any other obligation it may have
hereunder or otherwise than under this Section 9.
SECTION 10. SURVIVAL OF AGREEMENTS, REPRESENTATIONS AND INDEMNITIES.
The respective indemnities of the Company, the Association and the Agent and the
representations and warranties
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and other statements of the Company, the Association and the Agent set forth in
or made pursuant to this Agreement shall remain in full force and effect,
regardless of any termination or cancellation of this Agreement or any
investigation made by or on behalf of the Agent, the Company, the Association or
any controlling person referred to in Section 8 hereof, and shall survive the
issuance of the Shares, and any successor or assign of the Agent, the Company,
the Association, and any such controlling person shall be entitled to the
benefit of the respective agreements, indemnities, warranties and
representations.
SECTION 11. TERMINATION. The Agent may terminate this Agreement by
giving the notice indicated below in this Section 11 at any time after this
Agreement becomes effective as follows:
(a) In the event the Company fails to sell the required
minimum number of the Shares by June 30, 1998, and in
accordance with the provisions of the Plan or as
required by the Conversion Regulations, and applicable
law, this Agreement shall terminate upon refund by the
Company to each person who has subscribed for or
ordered any of the Shares the full amount which it may
have received from such person, together with interest
as provided in the Prospectus, and no party to this
Agreement shall have any obligation to the other
hereunder, except for payment by the Company and/or
the Association as set forth in Sections 2(a), 6, 8
and 9 hereof.
(b) If any of the conditions specified in Section 7 shall
not have been fulfilled when and as required by this
Agreement unless waived in writing, or by the Closing
Date, this Agreement and all of the Agent's
obligations hereunder may be cancelled by the Agent by
notifying the Company and the Association of such
cancellation in writing or by telegram at any time at
or prior to the Closing Date, and any such
cancellation shall be without liability of any party
to any other party except as otherwise provided in
Sections 2(a), 6, 8 and 9 hereof.
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(c) If the Agent elects to terminate this Agreement as
provided in this Section, the Company and the
Association shall be notified promptly by telephone
or telegram, confirmed by letter.
The Company and the Association may terminate this Agreement in the
event the Agent is in material breach of the representations and warranties or
covenants contained in Section 5 and such breach has not been cured after the
Company and the Association have provided Webb with notice of such breach.
This Agreement may also be terminated by mutual written consent of the
parties hereto.
SECTION 12. NOTICES. All communications hereunder, except as herein
otherwise specifically provided, shall be mailed in writing and if sent to the
Agent shall be mailed, delivered or telegraphed and confirmed to Charles Webb &
Company, 211 Bradenton, Dublin, Ohio 43017-5034, Attention: Patricia A. McJoynt
(with a copy to Silver, Freedman & Taff, L.L.P., Attention: Martin L. Meyrowitz,
P.C. and, if sent to the Company and the Association, shall be mailed, delivered
or telegraphed and confirmed to the Company and the Association at 435 Main
Street, Bridgeport, Ohio 43912, Attention: Jon W. Letzkus, President (with a
copy to Vorys, Sater, Seymour and Pease, Attention: _______________).
SECTION 13. PARTIES. The Company and the Association shall be entitled
to act and rely on any request, notice, consent, waiver or agreement purportedly
given on behalf of the Agent when the same shall have been given by the
undersigned. The Agent shall be entitled to act and rely on any request, notice,
consent, waiver or agreement purportedly given on behalf of the Company or the
Association, when the same shall have been given by the undersigned or any other
officer of the Company or the Association. This Agreement shall inure solely to
the benefit of, and shall be binding upon, the Agent, the Company, the
Association, and their respective successors and assigns, and no other person
shall have or be construed to have any legal or equitable right, remedy or claim
under or in respect of or by virtue of this Agreement or any provision herein
contained. It is understood and agreed that this Agreement is the exclusive
agreement among the parties hereto, and supersedes any prior agreement among the
parties and may not be varied except in writing signed by all the parties.
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SECTION 14. CLOSING. The closing for the sale of the Shares shall take
place on the Closing Date at such location as mutually agreed upon by the Agent
and the Company and the Association. At the closing, the Company and the
Association shall deliver to the Agent in next day funds the commissions, fees
and expenses due and owing to the Agent as set forth in Sections 2 and 6 hereof
and the opinions and certificates required hereby and other documents deemed
reasonably necessary by the Agent shall be executed and delivered to effect the
sale of the Shares as contemplated hereby and pursuant to the terms of the
Prospectus.
SECTION 15. PARTIAL INVALIDITY. In the event that any term, provision
or covenant herein or the application thereof to any circumstance or situation
shall be invalid or unenforceable, in whole or in part, the remainder hereof and
the application of said term, provision or covenant to any other circumstances
or situation shall not be affected thereby, and each term, provision or covenant
herein shall be valid and enforceable to the full extent permitted by law.
SECTION 16. CONSTRUCTION. This Agreement shall be construed in
accordance with the laws of the State of Ohio.
SECTION 17. COUNTERPARTS. This Agreement may be executed in separate
counterparts, each of which so executed and delivered shall be an original, but
all of which together shall constitute but one and the same instrument.
If the foregoing correctly sets forth the arrangement among the
Company, the Association and the Agent, please indicate acceptance thereof in
the space provided below for that purpose, whereupon this letter and the Agent's
acceptance shall constitute a binding agreement.
SECTION 18. ENTIRE AGREEMENT. This Agreement, including schedules and
exhibits hereto, which are integral parts hereof and incorporated as though set
forth in full, constitutes the entire agreement between the parties pertaining
to the subject matter hereof superseding any and all prior or contemporaneous
oral or prior written agreements, proposals, letters of intent and
understandings, and cannot be modified, changed, waived or terminated except by
a writing which expressly states that it is an amendment, modification or
waiver, refers to this Agreement and is signed by the party to be charged. No
course of conduct
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or dealing shall be construed to modify, amend or otherwise affect any of the
provisions hereof.
Very truly yours,
OHIO STATE FINANCIAL BRIDGEPORT SAVINGS AND LOAN
SERVICES, INC. ASSOCIATION
By Its Authorized By Its Authorized
Representative: Representative:
- ------------------------------- ----------------------------
Jon W. Letzkus Jon W. Letzkus
President President
Accepted as of the date first above written
KEEFE, BRUYETTE & WOODS, INC.
By Its Authorized
Representative:
- --------------------------------------
John Bruno
Senior Vice President
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