THIRD CENTURY BANCORP
Up to 1,653,125 Shares
COMMON SHARES
(No Par Value)
Subscription Price $10.00 Per Share
AGENCY AGREEMENT
May ___, 2004
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Ladies and Gentlemen:
Third Century Bancorp, an Indiana corporation (the "Company"), and Mutual
Savings Bank, an Indiana-chartered savings bank located in Franklin, Indiana
(the "Bank") (references to the "Bank" include the Bank 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 ▇▇▇▇▇,
▇▇▇▇▇▇▇▇ & ▇▇▇▇▇, Inc. ("the Agent"), as follows:
Section 1. The Offering. The Bank, in accordance with its plan of
conversion adopted by its Board of Directors (as amended, the "Plan"), intends
to convert from an Indiana chartered mutual savings bank to an Indiana chartered
stock savings bank, and 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 1,653,125 shares of its common shares, without par value (the "Shares" or
"Common Shares"), in a subscription offering (the "Subscription Offering") to
(1) depositors of the Bank with Qualifying Deposits (as defined in the Plan) as
of December 31, 2002 ("Eligible Account Holders"), (2) the Mutual Savings Bank
Employee Stock Ownership Plan (the "ESOP"), (3) depositors of the Bank with
Qualifying Deposits as of March 31, 2004 ("Supplemental Eligible Account
Holders") and (4) the Bank's Other Members as defined in the Plan. Subject to
the prior subscription rights of the above-listed parties, the Company may offer
for sale in a community offering (the "Community Offering" and when referred to
together with or subsequent to the Subscription Offering, the "Subscription and
Community Offering") conducted concurrently with the Subscription Offering, the
Shares not 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 with a preference given to natural people residing in ▇▇▇▇▇▇▇ County,
Indiana. It is anticipated that shares not subscribed for in the Subscription
and Community Offering may be offered to certain members of the general public
on a best efforts basis through a selected dealers agreement (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 Bank 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 SB-2 (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 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, Chapter III, Subchapter A, Part 303, Subpart I
(the "FDIC Regulations"), the Bank has filed with the FDIC a Notice of Intent to
Convert to Stock Form (the "Notice"), and has filed such amendments thereto as
may have been required by the FDIC. In accordance with The Indiana Financial
Institutions Act, Chapter 28, of the Indiana Code, and any regulations
promulgated pursuant thereto, (the "Department Regulations" and together with
the FDIC Regulations, the "Conversion Regulations"), the Bank has filed an
Application to Convert from a Mutual Savings Bank to a Stock Savings Bank (the
"Conversion Application") with the Indiana Department of Financial Institutions
(the "Department") and has filed such amendments thereto as may have been
required by the Department. In addition, in accordance with the Bank Holding
Company Act of 1956, as amended ("BHCA"), the Company has filed with the Board
of Governors of the Federal Reserve System ("FRB"), the Company's application to
acquire ownership of the Bank on Form FRY-3 ("Holding Company Application") and
has filed such amendments thereto as may have been required by the FRB.
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 Bank hereby appoint the Agent as their exclusive financial advisor and
marketing agent (i) to utilize its best efforts to solicit subscriptions for
Common Shares and to advise and assist the Company and the Bank 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 Bank as to the matters set forth in the letter agreement, dated ___________,
2004, between the Bank and the Agent. It is acknowledged by the Company and the
Bank 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.
The obligations of the Agent pursuant to this Agreement 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 Bank and
the Agent may agree to renew this Agreement under mutually acceptable terms.
In the event the Company is unable to sell a minimum of 1,062,500 Shares
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 its counsel.
The release of Shares against payment therefor shall be made on a date and at a
place acceptable to the Company, the Bank and the Agent. Certificates for shares
shall be delivered directly to the purchasers in accordance with their
directions. The date upon which the Company shall release or deliver the Shares
sold in the Offering, in accordance with the terms herein, is called the
"Closing Date."
The Agent shall receive the following compensation for its services
hereunder:
(a) A management fee of $25,000, payable in four consecutive monthly
installments of $6,250. Such fee 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, including any accrued legal fees expended by the
Agent. The management fee shall be applied against the success fee
described in subparagraph 2(b).
(b) A success fee of 1.50% which shall be based on the aggregate purchase
price of common stock sold in the Subscription and Community Offering,
excluding shares purchased by the Bank's officers, directors, or employees
(or members of their immediate family) plus the ESOP, tax-qualified or
stock based compensation plans (except individual retirement accounts,
"▇▇▇"s) or similar plan created by the Bank for some or all of its
directors or employees.
(c) If any of the Common Shares remain available after the Subscription
Offering, at the request of the Bank, the Agent will seek to form a
syndicate of registered broker-dealers ("Selected 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. The Agent
will endeavor to distribute the Common Shares among the Selected Dealers in
a fashion which best meets the distribution objectives of the Bank and the
Plan. The Agent will be paid a fee not to exceed 5.5% of the aggregate
Purchase Price of the Shares sold by the Selected Dealers. The Agent will
pass onto the Selected Dealers who assist in the Syndicated Community
Offering an amount competitive with gross underwriting discounts charged at
such time for comparable amounts of stock sold at a comparable price per
share in a similar market environment. Fees with respect to purchases
effected with the assistance of Selected Dealers other than the Agent shall
be transmitted by the Agent to such Selected Dealers. The decision to
utilize Selected Dealers will be made by the Bank upon consultation with
the Agent.
(d) The Agent will be reimbursed for out-of-pocket expenses, including
costs of travel, meals and lodging, photocopying, telephone, facsimile and
couriers not to exceed $10,000. The Bank and Company shall reimburse the
Agent for fees and expenses of counsel, which shall not exceed $35,000. The
Bank will bear the expenses of the Offering customarily borne by issuers
including, without limitation, regulatory filing fees, SEC, "Blue Sky," and
NASD filing and registration fees; the fees of the Bank's accountants,
attorneys, appraiser, transfer agent and registrar, printing, mailing and
marketing expenses associated with the conversion; and the fees set forth
under this Section 2; and fees for "Blue Sky" legal work. The Company or
the Bank will reimburse the Agent for any such expenses incurred by the
Agent on their behalf.
Full payment of Agent's actual and accountable expenses, advisory fees and
compensation shall be made in next day funds on the earlier of the Closing Date
or a determination by the Bank to terminate or abandon the Plan.
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 Bank 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
Bank and filed with the Commission was declared effective by the Commission
on May ___, 2004. At the time the Registration Statement, including the
Prospectus contained therein (including any amendment or supplement),
became effective, the Registration Statement complied in all material
respects with the requirements of the 1933 Act and the 1933 Act Regulations
and the Registration Statement, including the Prospectus contained therein
(including any amendment or supplement thereto), and any information
regarding the Company or the Bank contained in Sales Information (as such
term is defined in Section 8 hereof) authorized by the Company or the Bank
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 is filed with the Commission and at
the Closing Date referred to in Section 2, the Prospectus (including any
amendment or supplement thereto) and any information regarding the Company
or the Bank contained in Sales Information (as such term is defined in
Section 8 hereof) authorized by the Company or the Bank 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 Bank by the Agent or its counsel expressly regarding the
Agent for use in the Prospectus under the caption "The
Conversion--Marketing Arrangements" 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
Bank and filed with the Department was approved on May ___, 2004 and the
related Prospectus has been authorized for use by the Department. At the
time of the approval of the Conversion Application, including the
Prospectus (including any amendment or supplement thereto), by the
Department 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
Department Regulations. 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 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 Bank 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--Marketing Arrangements" 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 has been prepared by the Bank and the Company
in material conformity with the requirements of the BHCA and has been filed
with and approved by the FRB. A conformed copy of the Holding Company
Application has been delivered to the Agent.
(c) By letter dated May ___, 2004, the FDIC issued its non-objection to the
Notice or the transactions contemplated thereby. At the time of the
non-objection to the Notice, including the Prospectus (including any
amendment or supplement thereto), by the FDIC and at all times subsequent
thereto until the Closing Date, the Notice, including the Prospectus
(including any amendment or supplement thereto), will comply in all
material respects with the FDIC Regulations. The Notice, 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 4(c) shall not apply to statements or omissions made in
reliance upon and in conformity with written information furnished to the
Company or the Bank by the Agent or its counsel expressly regarding the
Agent for use in the Prospectus contained in the Notice under the caption
"The Conversion--Marketing Arrangements" 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.
(d) No order has been issued by the Commission, the Department 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 pending or, to the best
knowledge of the Company or the Bank, threatened.
(e) At the Closing Date, the Plan will have been adopted by the Boards of
Directors of both the Company and the Bank and approved by the members of
the Bank, 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
precedent to the Conversion imposed upon the Company or the Bank by the
Department, the FDIC, the Commission, or any other regulatory authority and
in the manner described in the Prospectus. To the best knowledge of the
Company and the Bank, no person has sought to obtain review of the final
action of the Department or the FDIC in approving the Plan or in approving
or not objecting to the Conversion or the FRB in approving the Holding
Company Application pursuant to the BHCA.
(f) The Bank has been organized and is a validly existing Indiana chartered
savings bank in mutual form of organization and upon the Conversion will
become a duly organized and validly existing Indiana chartered savings bank
in permanent 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 Bank has obtained all
licenses, permits and other governmental authorizations currently required
for the conduct of its business, except those that individually or in the
aggregate would not materially adversely affect the financial condition,
results of operations or business of the Company, the Bank and Mutual
Financial Services, Inc., taken as a whole ("Material Adverse Effect"); all
such licenses, permits and governmental authorizations are in full force
and effect, and the Bank is in compliance with all material laws, rules,
regulations and orders applicable to the operation of its business, except
where failure to be in compliance would not have a Material Adverse Effect;
the Bank 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. The Bank 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 Bank. The Bank has one wholly owned
subsidiary, Mutual Financial Services, Inc., which is not a significant
subsidiary for purposes of Regulation S-X or SB. Upon completion of the
sale by the Company of the Shares contemplated by the Prospectus, (i) all
of the authorized and outstanding capital stock of the Bank will be owned
by the Company and (ii) the Company will have no direct subsidiaries other
than the Bank. The Conversion will be 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 Department's and the FDIC's resolutions or letters of
approval or non-objection, at the time of the Closing all terms,
conditions, requirements and provisions with respect to the Conversion
imposed by the Commission, the Department, the FDIC and the FRB, if any,
will have been complied with by the Company and the Bank 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 under the laws of the State of Indiana 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. The Company has obtained
all licenses, permits and other governmental authorizations currently
required for the conduct of its business except those that individually or
in the aggregate would not have a Material Adverse Effect; 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.
(h) The Bank is a member of the Federal Home Loan Bank of Indianapolis
("FHLB-Indianapolis"). The deposit accounts of the Bank 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 Bank, threatened. Upon consummation of the Conversion, the
liquidation account for the benefit of Eligible Account Holders and
Supplemental Eligible Account Holders will be duly established in
accordance with the requirements of the Conversion Regulations.
(i) The Company and the Bank 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 Bank, 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 Bank, taken as a whole;
and all of the leases and subleases material to the business of the Company
and the Bank, taken as a whole, under which the Company or the Bank hold
properties, including those described in the Registration Statement and
Prospectus, are in full force and effect.
(j) The Company and the Bank have received an opinion of their special
counsel, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇, with respect to the federal income tax
consequences of the Conversion, and an opinion of BKD, LLP with respect to
the Indiana income tax consequences of the Conversion; all material aspects
of such opinions are accurately summarized in the Registration Statement
and the Prospectus. The Company and the Bank represent and warrant that the
facts upon which such opinions are based are truthful, accurate and
complete.
(k) The Company and the Bank 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
Department and the FDIC of the final appraisal of the Bank. 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 Bank.
This Agreement has been validly executed and delivered by the Company and
the Bank and is the valid, legal and binding agreement of the Company and
the Bank 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).
(l) Neither the Company nor the Bank is in violation of any directive
received from the Department, 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, regulations, decisions,
directives and orders of the Department 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 Bank, 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 financial condition, results of
operations or business of the Company or the Bank, or which would
materially affect their properties and assets.
(m) The financial statements, schedules and notes related thereto which are
included in the Prospectus fairly present the balance sheet, income
statement, statement of changes in equity capital and statement of cash
flows of the Bank 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 the 1933 Act Regulations and
applicable regulations of the Department and the FDIC. 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
Bank with the Department and the FDIC, except that accounting principles
employed in such regulatory filings conform to the requirements of the
Department and the FDIC and not necessarily to GAAP. The other financial,
statistical and pro forma information and related notes included in the
Prospectus present fairly the information shown therein on a basis
consistent with the audited and unaudited financial statements of the Bank
included in the Prospectus, and as to the pro forma adjustments, the
adjustments made therein have been properly applied on the basis described
therein.
(n) 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 Bank, considered as one enterprise, or in the earnings,
capital or properties of the Company or the Bank, 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 Bank or in the principal amount of
the Bank's assets which are classified by the Bank 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 equity capital or total assets of
the Bank, nor has the Company or the Bank issued any securities (other than
in connection with the incorporation of the Company, if necessary) 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 Bank; (iv) there has been
no material adverse change in the Company's or the Bank's relationship with
its insurance carriers, including, without limitation, cancellation or
other termination of the Company's or the Bank's fidelity bond or any other
type of insurance coverage; (v) except as disclosed in the Prospectus,
there has been no material change in management of the Company or the Bank;
(vi) neither the Company nor the Bank has sustained any material loss or
interference with its respective business or properties from fire, flood,
windstorm, earthquake, accident or other calamity, whether or not covered
by insurance; and (vii) neither the Company nor the Bank has defaulted in
the payment of principal or interest on any outstanding debt obligations.
All documents made available or delivered or to be made available or
delivered by the Bank 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 Bank, or in
connection with the Agent's exercise of due diligence, except for those
documents which were prepared by parties other than the Bank, the Company
or their representatives, to the best knowledge of the Bank 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.
(o) Neither the Company nor the Bank is (i) in violation of its articles of
incorporation or bylaws (and the Bank will not be in violation of its
articles of incorporation 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 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 Bank pursuant to the Articles of Incorporation and
Bylaws of the Company or the Articles of Incorporation and Bylaws of the
Bank (in either mutual or capital stock form) or any material contract,
lease or other instrument in which the Company or the Bank has a beneficial
interest, or any applicable law, rule, regulation or order; (ii) violate
any authorization, approval, judgment, decree, order, statute, rule or
regulation applicable to the Company or the Bank, except for such
violations which would not have a Material Adverse Effect; or (iii) with
the exception of the liquidation account established in the Conversion,
result in the creation of any material lien, charge or encumbrance upon any
property of the Company or the Bank.
(p) 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 or
the Bank 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 Bank is a party or by which either of them or any of their property
is bound or affected, except such defaults which would not have a Material
Adverse Effect; 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 and the Bank, threatened any action or proceeding wherein the
Company or the Bank would or might be alleged to be in default thereunder,
where such action or proceeding, if determined adversely to the Company or
the Bank, would have a Material Adverse Effect.
(q) 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; 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 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 Bank, 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.
(r) 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 or non-objection of
the Commission, the Department, the FDIC and the FRB, 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 National Association of Securities Dealers, Inc. ("NASD").
(s) BKD, LLP, which has certified the audited financial statements and
schedules of the Bank included in the Prospectus, has advised the Company
and the Bank in writing that they are, with respect to the Company and the
Bank, independent public accountants within the meaning of the Code of
Professional Ethics of the American Institute of Certified Public
Accountants.
(t) ▇▇▇▇▇▇ & Company, Inc., which has prepared the Bank's Conversion
Valuation Appraisal Report as of _________, 2004 (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 Bank
within the meaning of the Conversion Regulations.
(u) The Company and the Bank have timely filed all required federal, state
and local tax returns; the Company and the Bank 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.
(v) The Bank 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.
(w) To the knowledge of the Company and the Bank, neither the Company, the
Bank nor employees of the Company or the Bank has made any payment of funds
of the Company or the Bank 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.
(x) Prior to the Conversion, neither the Company nor the Bank has: (i)
issued any securities within the last 18 months (except for notes to
evidence bank loans and reverse repurchase agreements or other liabilities
in the ordinary course of business or as described in the Prospectus); (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 and other securities in the ordinary course of business; (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 Bank 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 placing the funds received from
subscriptions for Shares in a special interest-bearing account with the
Bank 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.
(y) The Company and the Bank have not relied upon the Agent or its legal
counsel for any legal, tax or accounting advice in connection with the
Conversion.
(z) The Company is not required to be registered under the Investment
Company Act of 1940, as amended.
(aa) Any certificates signed by an officer of the Company or the Bank
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 Bank 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. The Agent represents and
warrants to the Company and the Bank as follows:
(i) The Agent 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 Indiana with full power and authority to provide the services
to be furnished to the Bank 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.
(iii) Each of the Agent and its employees, agents and representatives who
shall perform any of the services hereunder shall be duly authorized and
empowered, and shall have all licenses, approvals and permits necessary to
perform such services; and the Agent is a registered selling agent in each
of the jurisdictions in which the Shares are to be offered by the Company
in reliance upon the Agent as a registered selling agent as set forth in
the blue sky memorandum prepared with respect to the Offering.
(iv) The execution and delivery of this Agreement by the Agent, the
consummation of the transactions contemplated hereby and compliance with
the terms and provisions hereof will not conflict with, or result in a
breach of, any of the terms, provisions or conditions of, or constitute a
default (or an event which with notice or lapse of time or both would
constitute a default) under, the Articles of Incorporation or Bylaws 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 Bank. The Company and the Bank
hereby jointly and severally covenant with the Agent as follows:
(a) The Company will not, at any time after the date the Registration
Statement is declared effective, file any amendment or supplement to the
Registration Statement without providing the Agent and its counsel 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 Bank will not, at any time after either the Conversion Application
is approved by the Department or the Notice is not objected to by the FDIC,
file any amendment or supplement to such Conversion Application or Notice
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 after the Holding Company Application
is approved by the FRB, file any amendment or supplement to such Holding
Company Application without providing the Agent and its counsel an
opportunity to review the non-confidential 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 Bank will use their best efforts to cause any
post-effective amendment to the Registration Statement to be declared
effective by the Commission, any post-effective amendment to the Conversion
Application to be approved by the Department and any post-effective
amendment to the Notice to be not objected to by the FDIC 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 Department; (iii) when the Bank receives a letter of
non-objection from the FDIC regarding the Notice; (iv) of any comments from
the Commission, the Department or the FDIC, or any other governmental
entity with respect to the Conversion or the transactions contemplated by
this Agreement; (v) of the request by the Commission, the Department, or
any other governmental entity for any amendment or supplement to the
Registration Statement, the Conversion Application, the Notice or for
additional information; (vi) of the issuance by the Commission, the
Department or the FDIC, 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 Bank
under the Conversion Regulations, or other applicable law, or the threat of
any such action; or (vii) of the occurrence of any event mentioned in
paragraph (h) below. The Company and the Bank will make every reasonable
effort (i) to prevent the issuance by the Commission, the Department or the
FDIC, or any other state authority of any such order and, if any such order
shall at any time be issued, and (ii) to obtain the lifting thereof at the
earliest possible time.
(e) The Company and the Bank will deliver to the Agent and to its counsel
two conformed copies of the Registration Statement, the Conversion
Application, the Notice and the Holding Company Application, as originally
filed and of each amendment or supplement thereto, including all exhibits.
Further, the Company and the Bank 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 Bank 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 Bank 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
Department, the FDIC, the FRB or the Conversion Regulations, and by the
1933 Act, the 1933 Act Regulations, the 1934 Act 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 Bank will comply, at their own expense, with all
material requirements imposed upon them by the Commission, the Department,
the FDIC, the FRB 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 or the Bank shall occur, as a result of which it is necessary or
appropriate, in the opinion of counsel for the Company and the Bank 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 Bank will immediately so inform the Agent and prepare and
file, at their own expense, with the Commission, the Department and the
FDIC, 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 of this Agreement, the Company and the Bank
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 Bank 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 Bank 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 Department and the
FDIC, and such Eligible Account Holders and Supplemental Eligible Account
Holders who continue to maintain their savings accounts in the Bank 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 Bank.
(k) The Company and the Bank will not sell or issue, contract to sell or
otherwise dispose of, for a period of 90 days after the Closing Date,
without the Agent's prior written consent, any of their 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 will file a registration statement for the Common Shares
under Section 12(g) of the 1934 Act prior to the completion of the Offering
and shall request that such registration statement be effective upon or
before 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 applicable law.
(m) During the period during which the Common Shares are registered under
the 1934 Act or for three 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 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 or
10-KSB, 10-Q or 10-QSB 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 shareholders or filed with the Commission, the FDIC
or any other supervisory or regulatory authority or any national securities
exchange or system on which any class of securities of the Company is
listed or quoted, each press release and material news items and additional
documents and information with respect to the Company or the Bank as the
Agent may reasonably request; and (iii) from time to time, such other
nonconfidential information concerning the Company or the Bank as the Agent
may reasonably request.
(o) The Company and the Bank 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 BHCA, the
1933 Act, the 1933 Act Regulations and the rules and 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 Bank 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 encourage and assist a
broker-dealer to maintain quotation of the Shares on the OTC-Bulletin
Board.
(r) The Bank 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 Bank'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 Bank will maintain such records of all
funds received to permit the funds of each subscriber to be separately
insured by the FDIC (to the maximum extent allowable) and to enable the
Bank 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 and the Bank 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 Rule 2790.
(t) Neither the Company nor the Bank will amend the Plan of Conversion
without notifying the Agent prior thereto.
(u) 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 in all material respects.
(v) Prior to the Closing Date, the Company and the Bank 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.
(w) 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 Bank will have: (i) issued
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 Bank, taken as a whole.
(x) The facts and representations provided to ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇ by the
Bank and the Company and upon which ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇ 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
Bank jointly and severally agree to pay or reimburse the Agent for actual
accountable out of pocket expenses, including but not limited to: (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; and (c) subject to Section 2(d), all reasonable expenses of the
Conversion, including but not limited to the Agent'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. In the event the Company
is unable to sell the minimum number of shares necessary to complete the
offering or the Conversion is terminated or otherwise abandoned, the Company and
the Bank shall promptly reimburse the Agent in accordance with Section 2(d)
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 Bank 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 Bank shall have performed all of their obligations hereunder to be performed
on or before such dates, and to the following further conditions:
(a) At the Closing Date, the Company and the Bank shall have conducted the
Conversion in all material respects in accordance with the Plan, the
Conversion Regulations, the applicable laws of Indiana, 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 Department and the FDIC.
(b) The Registration Statement shall have been declared effective by the
Commission, the Conversion Application approved by the Department and the
Notice not objected to by the FDIC 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
Bank's knowledge, threatened by the Commission, the Department, the FDIC,
or any other 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 ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇, special
counsel for the Company and the Bank, 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 Indiana.
(ii) The Company has corporate power and authority to own, lease
and operate its properties and to conduct its business as
described in the Registration Statement and the Prospectus.
(iii) The Bank is a validly existing Indiana chartered savings
bank in mutual form and immediately following the completion of
the Conversion will be a validly existing Indiana chartered
savings bank in permanent 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 Bank 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) The Bank is a member of the FHLB-Indianapolis. The deposit
accounts of the Bank are insured by the FDIC up to the maximum
amount allowed under law and to such counsel's Actual Knowledge,
no proceedings for the termination or revocation of such
insurance are pending or threatened; the description of the
liquidation account as set forth in the Prospectus under the
caption "The Conversion--Effects of Conversion to Stock Form on
Depositors and Borrowers of Mutual Savings Bank--Effect on
Liquidation Rights," 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.
(v) Immediately following the consummation of the Conversion, the
authorized, issued and outstanding Common Shares of the Company
will be within the range set forth in the Prospectus under the
caption "Capitalization," and 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. 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.
(vi) The Bank 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. 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 Bank; and this Agreement is a valid and binding obligation of
the Company and the Bank, enforceable against the Company and the
Bank 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 federally chartered 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 limitation the provisions of Sections 23A and
23B of the Federal Reserve Act and except that no opinion need 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).
(vii) The Conversion Application has been approved by the
Department and the Prospectus has been authorized for use by the
Department. The FRB has approved the Holding Company Application
and the purchase by the Company of all of the issued and
outstanding capital stock of the Bank and to such counsel's
Actual Knowledge, no action has been taken, and none is pending
or threatened, to revoke any such authorization or approval.
(viii) The Plan has been duly adopted by the required vote of the
directors of the Company and the Bank, and based upon the
certificate of the inspectors of election, by the members of the
Bank.
(ix) Subject to the satisfaction of the conditions to the
Department's approval of the Conversion, the FDIC's non-objection
to the Conversion and the FRB's approval of the Holding Company
application, 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 (as to which no opinion need be
rendered).
(x) The Registration Statement is effective under the 1933 Act
and no stop order suspending the effectiveness has been issued
under the 1933 Act or proceedings therefor initiated or, to such
counsel's Actual Knowledge, threatened by the Commission.
(xi) At the time the Conversion Application, including the
Prospectus contained therein, was approved by the Department, the
Conversion Application, including the Prospectus contained
therein, complied as to form in all material respects with the
requirements of the Department Regulations (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).
(xii) At the time of the Notice, including the Prospectus
contained therein, was not objected to by the FDIC, the Notice,
including the Prospectus contained therein, complied as to form
in all material respects with the requirements of the FDIC
Regulations (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 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 and the
1933 Act Regulations.
(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) To the Actual Knowledge of such counsel, there are no legal
or governmental proceedings pending or threatened which are
required to be disclosed in the Registration Statement and
Prospectus, other than those disclosed therein.
(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 Notice, 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
Notice, the Registration Statement or the Prospectus. The
description in the Conversion Application, the Notice, 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 and Indiana law, rules, regulations, decisions
and orders including, but not limited to, the Conversion
Regulations; to such counsel's Actual Knowledge, the Conversion
has been effected by the Company and the Bank in all material
respects in accordance with the Conversion Regulations and
applicable Office, FDIC and FRB approvals or letters of
non-objection issued thereunder; to such counsel's Actual
Knowledge, no order has been issued by the Department, the FDIC ,
the FRB, the Commission or any state authority to suspend the
Offering or the use of the Prospectus, and no action for such
purposes has been instituted or threatened by the Department, the
FDIC, the FRB, the Commission or any other 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
Department, the FDIC or the FRB, as the case may be, approving
the Plan, the Conversion Application, the Holding Company
Application, Notice or the Prospectus.
(xviii) To such counsel's Actual Knowledge, the Company and the
Bank 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 Bank are in all material respects complying
therewith.
(xix) Neither the Company nor the Bank is in violation of its
Articles of Incorporation 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 and the Bank 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 Bank pursuant to any
material contract, indenture, mortgage, loan agreement, note,
lease or other instrument to which the Company or the Bank 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 Bank 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 the Bylaws of the Company or the
Bank or result in any violation of any applicable federal or
state law, act, regulation (except that no opinion with respect
to the securities and blue sky laws of various jurisdictions or
the rules or regulations of the NASD need be rendered) or order
or court order, writ, injunction or decree.
(xix) The Company's Articles of Incorporation and Bylaws comply
in all material respects with the laws of the State of Indiana.
The Bank's Articles of Incorporation and Bylaws comply in all
material respects with Indiana law.
(xx) The information in the Prospectus under the captions
"Regulation," "The Conversion," "Restrictions on Acquisitions of
Stock and Related Takeover Defensive Provisions" and "Description
of Capital Stock," to the extent that such information
constitutes matters of law, summaries of legal matters, documents
or proceedings, or legal conclusions, has been reviewed by such
counsel and is correct in all material respects. The description
of the Conversion process in the Prospectus under the caption
"The Conversion" 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 fairly describes such process in all material
respects. The descriptions in the Prospectus of statutes or
regulations are accurate summaries and fairly present the
information required to be shown. The information under the
caption "The Conversion--Income Tax Consequences" has been
reviewed by such counsel and fairly describes the federal and
state tax opinions rendered by them and BKD, LLP, respectively,
to the Company and the Bank with respect to such matters.
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 Bank 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 Indiana.
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 Bank 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 Bank.
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 Bank, 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 Bank), nothing has come to
their attention that would lead them to believe that the
Conversion Application, the Notice, 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.
(d) 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 Bank 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 or the Bank 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 or the Bank independently,
or of the Company and the Bank 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 Bank 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 Bank, 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 Bank
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 Bank, threatened by the Department, the FDIC, the
Commission, the FRB, or any state authority; and (viii) to the best
knowledge of the Company or the Bank, no person has sought to obtain review
of the final action of the Department approving the Plan.
(e) Prior to and at the Closing Date: (i) in the reasonable opinion of the
Agent, there shall have been no material adverse change in the financial
condition, results of operations or business of the Company and the Bank
considered as one enterprise, from that as of the latest dates as of which
such condition is set forth in the Prospectus, other than transactions
referred to or contemplated therein; (ii) the Company or the Bank shall not
have received from the Department 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 financial condition, results of operations or business of the
Company and the Bank taken as a whole; (iii) neither the Company nor the
Bank shall have been in default (nor shall an event have occurred which,
with notice or lapse of time or both, would constitute a default) under any
provision of any agreement or instrument relating to any outstanding
indebtedness; (iv) no action, suit or 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 or the Bank,
threatened against the Company or the Bank or affecting any of their
properties wherein an unfavorable decision, ruling or finding would
materially and adversely affect the financial condition, results of
operations or business taken as a whole; and (v) the Shares shall 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 Bank.
(f) Concurrently with the execution of this Agreement, the Agent shall
receive a letter from BKD, LLP dated as of the date of the Prospectus and
addressed to the Agent: (i) confirming that BKD, LLP is a firm of
independent public accountants 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 Department, the FDIC and the
Commission and stating in effect that in its opinion the financial
statements, schedules and related notes of the Bank as of December 31, 2003
and 2002 and for the years ended December 31, 2003 and 2002 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 Department, the FDIC and the
Commission 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 financial statements of the Bank
prepared by the Bank, a reading of the minutes of the meetings of the Board
of Directors and members of the Bank and consultations with officers of the
Bank 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 Act, applicable accounting requirements of the Department, the
FDIC and the Commission 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 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 Bank; or (C) there was any decrease in the net assets
of the Bank at the date of such letter as compared with amounts shown in
the latest unaudited balance sheets 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 Bank, which are subject to the internal
controls of the Bank, the accounting system and other data prepared by the
Bank, 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.
(g) At the Closing Date, the Agent shall receive a letter dated the Closing
Date, addressed to the Agent, confirming the statements made by BKD, LLP 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) to be a
date specified in the letter required by this subsection (g) which for
purposes of such letter shall not be more than three business days prior to
the Closing Date.
(h) At the Closing Date, the Bank shall receive a letter from ▇▇▇▇▇▇ &
Company, Inc., dated the Closing Date (i) confirming that said firm is
independent of the Company and the Bank and is experienced and expert in
the area of corporate appraisals, (ii) stating in effect that the Appraisal
prepared by such firm complies in all material respects with the applicable
requirements of the Department and the FDIC Regulations, and (iii) further
stating that its opinion of the aggregate pro forma market value of the
Company and the Bank expressed in its Appraisal dated as of __________,
2004, as most recently updated, remains in effect.
(i) At or prior to the Closing Date, the Agent shall receive: (i) a copy of
the letters from the Department approving the Conversion Application and
authorizing the use of the Prospectus and the Proxy Statement; (ii) a copy
of the order from the Commission declaring the Registration Statement
effective; (iii) a certificate from the Department evidencing the valid
existence of the Bank; (iv) a certificate from the State of Indiana
evidencing the good standing of the Company; (v) a certificate from the
FDIC evidencing the Bank's insurance of accounts; (vi) a certificate from
the FHLB-Indianapolis evidencing the Bank's membership therein; (vii) a
copy of the letter from the FRB approving the Company's Holding Company
Application; (viii) a certified copy of the Bank's Articles of
Incorporation and Bylaws; and (ix) a copy of the letter of non-objection
from the FDIC.
(j) 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 (the "NYSE") 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, Indiana savings banks or federal savings banks or a
general moratorium on the withdrawal of deposits from commercial banks,
Indiana savings banks or federal savings banks 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 judgment, makes it impracticable or inadvisable
to proceed with the Offering or the delivery of the Shares on the terms and
in the manner contemplated in the Registration Statement and the
Prospectus.
(k) 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 Bank in connection with the
Conversion and the sale of the Shares as herein contemplated shall be
satisfactory in form and substance to the Agent and its counsel.
Section 8. Indemnification.
(a) The Company and the Bank 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 Conversion Application (or any amendment or supplement thereto), the
Notice (or any amendment or supplement thereto), the Holding Company
Application or any instrument or document executed by the Company or the
Bank or based upon written information supplied by the Company or the Bank
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 Bank with
their consent or based upon written or oral information furnished by or on
behalf of the Company or the Bank, 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), the Notice (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 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 (or any
amendment or supplement thereto), the Notice (or any amendment or
supplement thereto) any Blue Sky Application or Sales Information made in
reliance upon and in conformity with information furnished in writing to
the Company or the Bank 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 Bank by the Agent regarding the
Agent is set forth in the Prospectus under the caption "The
Conversion--Marketing Arrangements"; and, provided further, that such
indemnification shall be to the extent not prohibited by the Commission,
the Department, the FDIC and the FRB.
(b) The Agent agrees to indemnify and hold harmless the Company and the
Bank, their directors and officers and each person, if any, who controls
the Company or the Bank 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
Bank, 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 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), the Notice (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), the Notice (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 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), the Notice (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 Bank 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 Bank by the Agent regarding the
Agent is set forth in the Prospectus under the caption "The
Conversion--Marketing Arrangements."
(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.
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 Bank or the Agent, the Company,
the Bank 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, but after deducting any contribution received by the Company, the
Bank or the Agent from persons other than the other parties 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 and
expenses paid to the Agent pursuant to Section 2 of this Agreement bears to the
gross proceeds received by the Company from the sale of the Shares in the
Offering, and the Company and the Bank shall be responsible for the balance. If,
however, the allocation provided above is not permitted by applicable law, 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 Bank 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
Bank 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 Bank on the one hand or the Agent
on the other and the parties' relative intent, good faith, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Company, the Bank 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 pursuant to Section 8(b) or
this Section 9 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
▇▇▇▇ ▇▇▇) shall be entitled to contribution from any person who was not found
guilty of such fraudulent misrepresentation. The obligations of the Company, the
Bank and the Agent under this Section 9 and under Section 8 shall be in addition
to any liability which the Company, the Bank and the Agent may otherwise have.
For purposes of this Section 9, each of the Agent's, the Company's or the Bank's
officers and directors and each person, if any, who controls the Agent or the
Company or the Bank 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 Bank. 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 Bank and the Agent, the
representations and warranties and other statements of the Company, the Bank and
the Agent set forth in or made pursuant to this Agreement and the provisions
relating to contribution 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 Bank 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 Bank, 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) Subsequent to the date hereof, if any domestic or international event
or act or occurrence has materially disrupted the United States securities
markets such as to make it, in the Agent's reasonable opinion,
impracticable to proceed with the offering of the Shares; or if trading on
the NYSE shall have suspended (except that this shall not apply to the
imposition of NYSE trading collars imposed on program trading); or if the
United States shall have become involved in a war or major hostilities; or
if a general banking moratorium has been declared by a state or federal
authority which has a material effect on the Bank or the Conversion; or if
a moratorium in foreign exchange trading by major international banks or
persons has been declared; or if there shall have been a material adverse
change in the financial condition, results of operations or business of the
Company, or if the Bank shall have sustained a material or substantial loss
by fire, flood, accident, hurricane, earthquake, theft, sabotage or other
calamity or malicious act, whether or not said loss shall have been
insured; or if there shall have been a material adverse change in the
financial condition, results of operations or business of the Company or
the Bank.
(b) In the event the Company fails to sell the required minimum number of
the Shares by March 31, 2002, 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 as set forth in Sections 2(a), 6, 8 and 9 hereof.
(c) 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
Bank 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.
(d) If the Agent elects to terminate this Agreement as provided in this
Section, the Company and the Bank shall be notified promptly by telephone
or telegram, confirmed by letter.
The Company and the Bank 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 Bank have provided the Agent 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 ▇▇▇▇▇, ▇▇▇▇▇▇▇▇
& ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇
(with a copy to ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇, P.C., N.W., Suite 400,
Washington, D.C. 20015, Attention: ▇▇▇▇ ▇▇▇▇) and, if sent to the Company and
the Bank, shall be mailed, delivered or telegraphed and confirmed to the Company
and the Bank at ▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, President (with a copy to ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇, ▇▇▇▇ Merchants
Bank Building, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇).
Section 13. Parties. The Company and the Bank 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 Bank, when the
same shall have been given by the undersigned or any other officer of the
Company or the Bank. This Agreement shall inure solely to the benefit of, and
shall be binding upon, the Agent, the Company, the Bank, 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.
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 Bank. At the closing, the Company and the Bank 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.
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 or dealing shall be construed to modify, amend or otherwise
affect any of the provisions hereof.
If the foregoing correctly sets forth the arrangement among the Company,
the Bank and the Agent, please indicate acceptance thereof in the space provided
below for that purpose, whereupon this letter and the Agent's acceptance shall
constitute a binding agreement.
Very truly yours,
THIRD CENTURY BANCORP MUTUAL SAVINGS BANK
By Its Authorized Representative: By Its Authorized Representative:
--------------------------------- --------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, President ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, President
Accepted as of the date first above
written
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇, Inc.
By Its Authorized Representative:
---------------------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Managing Director
Exhibit A
THIRD CENTURY BANCORP
______________ SHARES
(MAXIMUM OFFERED IN CONVERSION)
COMMON STOCK
(NO PAR VALUE PER SHARE)
SELECTED DEALER'S AGREEMENT
_______________, 2004
We have agreed to assist Third Century Bancorp (the "Company") in
connection with the offer and sale of shares (the "Shares") of common stock, no
par value per share (the "Common Stock"), of the Company, to be issued in
connection with the conversion of Mutual Savings Bank, an Indiana chartered
savings bank (the "Bank"), from mutual to stock form. The Company in connection
with its plan to effect such conversion, offered _____________ Shares for
subscription by certain of the Bank's depositors and borrowers, and the Bank's
employee stock ownership plan in a subscription offering, and certain members of
the general public in a concurrent direct community offering. The Shares which
were not subscribed for pursuant to such subscription and direct community
offerings are being offered to the public in a syndicated community offering
(the "Syndicated Community Offering") in accordance with the conversion
regulations of the Federal Deposit Insurance Corporation ("FDIC") and Indiana
Department of Financial Institutions (the "Department"). The Shares, the bases
on which the number of Shares to be issued may change, and certain of the terms
on which they are being offered are more fully described in the enclosed
Prospectus (the "Prospectus").
We are offering to Selected Dealers (of which you are one) the opportunity
to participate in the solicitation of offers to buy the Shares in the Syndicated
Community Offering and we will pay you a fee in the amount of _____________
percent (________) of the dollar amount of the Shares sold on behalf of the
Company by you. The number of Shares sold by you shall be determined based on
the authorized designation of your firm on the order form or forms for such
Shares accompanying the funds transmitted for payment therefor (whether in the
form of a check payable to the Bank or a withdrawal from an existing account at
the Bank) to the special account established by the Company for the purpose of
holding such funds. It is understood, of course, that payment of your fee will
be made only out of compensation received by us for the Shares sold on behalf of
the Company by you, as evidenced in accordance with the preceding sentence. The
Bank has requested us to invite you to become a "Sponsoring Dealer," that is, a
Selected Dealer who solicits offers which result in the sale on behalf of the
Bank of at least ___________ Shares. You may become a Sponsoring Dealer (subject
to your fulfillment of the requirement in the preceding sentence) by checking
the box on the confirmation at the end of this letter. If you become a
Sponsoring Dealer, you shall be entitled to an additional fee in the amount of
_______ percent (______%) of the dollar amount of the Shares sold on behalf of
the Company by you as evidenced in the manner set forth above.
Each order form for the purchase of Shares must set forth the identity,
address and tax identification number of each person ordering Shares regardless
of whether the Shares will be registered in street name or in the purchaser's
name. Such order form should clearly identify your firm.
As soon as practicable after all the Shares are sold, we will remit to you,
out of our compensation as provided above, the fees to which you are entitled
hereunder, including your Sponsoring Dealer fee.
This offer is made subject to the terms and conditions herein set forth and
is made only to Selected Dealers which are (i) members in good standing of the
National Association of Securities Dealers, Inc. ("NASD") which agree to comply
with all applicable rules of the NASD, including, without limitation, the NASD's
Rule 2790 and Rule 2740 of the NASD's Conduct Rules, or (ii) foreign dealers not
eligible for membership in the NASD which agree (A) not to sell any Shares
within the United States, its territories or possessions or to persons who are
citizens thereof or residents therein and (B) in making other sales to comply
with the above-mentioned NASD Interpretation, Rules 2730, 2740 and 2750 of the
above-mentioned Conduct Rules as if they were NASD members and Rule 2420 of such
Conduct Rules as it applies to non-member brokers or dealers in a foreign
country.
Orders for Shares will be strictly subject to confirmation and we, acting
on behalf of the Company, reserve the right in our absolute discretion to reject
any order in whole or in part, to accept or reject orders in the order of their
receipt or otherwise, and to allot. Neither you nor any other person is
authorized by the Company, the Bank or by us to give any information or make any
representations other than those contained in the Prospectus in connection with
the sale of any of the Shares. No Selected Dealer is authorized to act as agent
for us when soliciting offers to buy the Shares from the public or otherwise. No
Selected Dealer shall engage in any transaction prohibited by Regulation M
promulgated under the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), with respect to the Common Stock during the offering.
We and each Selected Dealer assisting in selling Shares pursuant hereto
agree to comply with the applicable requirements of the Exchange Act and
applicable rules and regulations issued by the Board of Governors of the Federal
Reserve System, the FDIC and the Department. In addition, we and each Selected
Dealer confirm that the Securities and Exchange Commission (the "Commission")
interprets Rule 15c2-8 promulgated under the Exchange Act as requiring that a
prospectus be supplied to each person who is expected to receive a confirmation
of sale 48 hours prior to delivery of such person's order form.
We and each Selected Dealer further agree to the extent that our customers
desire to pay for Shares with funds held by or to be deposited with us, in
accordance with the interpretation of the Commission of Rule 15c2-4 promulgated
under the Exchange Act either (a) upon receipt of an executed order form or
direction to execute an order form on behalf of a customer to forward the
syndicated community offering price for the Shares ordered on or before 12:00
noon on the business day following receipt or execution of an order form by us
to the Bank for deposit in a segregated account or (b) to solicit indications of
interest in which event (i) we will subsequently contact any customers
indicating interest to confirm the interest and give instructions to execute and
return an order form or to receive authorization to execute an order form on
their behalf, (ii) we will mail acknowledgments of receipt of orders to each
customer confirming interest on the business day following such confirmation,
(iii) we will debit accounts of such customers on the fifth business day (the
"debit date") following receipt of the confirmation referred to in (i), and (iv)
we will forward completed order forms together with such funds to the Bank on or
before 12:00 noon on the next business day following the debit date for deposit
in a segregated account. We acknowledge that if the procedure in (b) is adopted,
our customer's funds are not required to be in their accounts until the debit
date. We and each Selected Dealer further acknowledge that, in order to use the
foregoing "sweep arrangements," we comply with the net capital requirements for
broker/dealers under Rule 15c3-1(a)(1) of the Exchange Act.
Unless earlier terminated by us, this Agreement shall terminate 45 full
business days after the date hereof, but may be extended by us for an additional
period or periods not exceeding 30 full business days in the aggregate. We may
terminate this Agreement or any provisions hereof at any time by written or
telegraphic notice to you. Of course, our obligations hereunder are subject to
the successful completion of the offering, including the sale of all of the
Shares.
You agree that at any time or times prior to the termination of this
Agreement you will, upon our request, report to us the number of Shares sold on
behalf of the Company by you under this Agreement.
We shall have full authority to take such actions as we may deem advisable
in respect to all matters pertaining to the offering. We shall be under no
liability to you except for lack of good faith and for obligations expressly
assumed by us in this Agreement.
Upon application to us, we will inform you as to the states in which we
believe the Shares have been qualified for sale under, or are exempt from the
requirements of, the respective "blue sky" laws of such states, but we assume no
responsibility or obligation as to your rights to sell Shares in any state.
Additional copies of the Prospectus and any supplements thereto will be
supplied in reasonable quantities upon request.
Any notice from us to you shall be deemed to have been duly given if
mailed, telephoned or telegraphed to you at the address to which this Agreement
is mailed.
This Agreement shall be construed in accordance with the laws of the State
of Ohio.
Please confirm your agreement hereto by signing and returning the
confirmation accompanying this letter at once to us at ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇,
Inc., ▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇. The enclosed duplicate copy will
evidence the agreement between us.
Very truly yours,
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇, INC.
By:
--------------------------------
[Name]
CONFIRMED AND ACCEPTED
As of the date first above written:
[NAME OF SELECTED DEALER]
By:
----------------------------------------
Name:
Title: