Exhibit 99.3
Appraisal Agreement with Keller & Company, Inc.
KELLER & COMPANY, INC.
555 METRO PLACE NORTH
SUITE 524
DUBLIN, OHIO 43017
(614)766-1426
(614)766-1459 FAX
March 12, 1997
The Board of Directors
Pioneer Bank, A Federal Sevings Bank
2055 First Street
P.O. Box 846
Baker City, Oregon 97814
Re: Conversion Valuation Agreement
Attn: Dan L. Webber, President
Keller & Company, Inc. (hereinafter referred to as KELLER) hereby proposes
to prepare an independent conversion appraisal of Pioneer Bank, A Federal
Savings Bank, Baker City, Oregon, (hereinafter referred to as PIONEER), relating
to the conversion of PIOPNEER from a mutual to a stock institution. KELLER will
provide a pro forma valuation of the market value of the shares to be sold in
the proposed conversion of PIONEER.
KELLER is a financial consulting firm that primarily serves the financial
institution industry. KELLER is experienced in evaluating and appraising thrift
institutions and thrift institution holding companies. KELLER is an experienced
conversion appraiser for filings with Office of Thrift Supervision ("OTS"), and
the Federal Deposit Insurance Corporation ("FDIC") and is also approved by the
Internal Revenue Service as an expert in thrift stock valuations.
KELLER agrees to prepare the conversion appraisal in the format required by
the OTS in a timely manner for prompt filing with the OTS and the Securities and
Exchange Commission. KELLER will provide any additional information as requested
and will complete appraisal updates in accordance with regulatory requirements.
KELLER will also be available to meet with any regulatory agency to review the
appraisal.
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The appraisal report will provide a detailed description of PIONEER,
including its financial condition, operating performance, asset quality, rate
sensitivity position, liquidity level and management qualifications. The
appraisal will include a description of PIONEER's market area, including both
economic and demographic characteristics and trends. An analysis of other
publicly-traded thrift institutions will be performed to determine a comparable
group and adjustments to the appraised value will be made based on a
comparision of PIONEER with the comparable group.
In making its appraisal, KELLER will rely upon the information in the
Subscription and Community Offering Circular (Prospectus), including the
financial statements. Among other factors, KELLER will also consider the
following: the present and projected operating results and financial condition
of PIONEER; the economic and demographic conditions in PIONEER's existing
marketing area; pertinent historical financial and other information relating to
PIONEER; a comparative evaluation of the operating and financial statistics of
PIONEER with those of other thrift institutions; the proposed price per share;
the aggregate size of the offering of Common Stock; the impact of the Conversion
on PIONEER's capital position and earnings potential; PIONEER's proposed
dividend policy; and the trading market for such securities. In preparing the
appraisal, KELLER will rely solely upon, and assume the accuracy and
completeness of, financial and statistical information provided by PIONEER, and
will not independently value the assets or liabilities of PIONEER in order to
prepare the appraisal.
Upon completion of the conversion appraisal, KELLER will provide a written
presentation of the Board of Directors of PIONEER to review the content of the
appraisal, the format and the assumptions. A written presentation will be
provided to each board member.
For its services in making this appraisal, KELLER's fee will be $17,000,
plus out-of-pocket expenses not to exceed $800. The appraisal fee will include
the preparation of one valuation update. All additional valuation updates will
be subject to an additional fee of $1,000 each. Upon the acceptance of this
proposal, KELLER shall be paid a retainer of $3,000 to be applied to the total
appraisal fee of $17,000, the balance of which will be payable at the time of
the completion of the appraisal.
PIONEER agrees, by the acceptance of this proposal, to indemnify KELLER and
its employees and affiliates for certain costs and expenses, including
reasonable legal fees, in connection with claims or litigation relating to the
appraisal and arising out of any misstatement
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or untrue statement of a material fact in information supplied to KELLER by
PIONEER or by an intentional omission by PIONEER to state a material fact in the
information so provided, except where KELLER has been negligent or at fault.
This proposal will be considered accepted upon the execution of the two
enclosed copies of this agreement and the return of one executed copy to KELLER,
accompanied by the specified retainer.
KELLER & COMPANY, INC.
By: /s/ Michael R. Keller
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Michael R. Keller
President
Pioneer Bank, A Federal Savings Bank
By: /s/ Dan L. Webber
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Dan L. Webber
President
Date: 3/31/97
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