Exhibit (10)(a)
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XXXXXXXX & COMPANY LETTERHEAD
November 12, 1997
Board of Directors
Anson Savings Bank, SSB
000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Dear Directors:
This letter sets forth the agreement between Anson Savings Bank, SSB
("Anson" or "Bank"), Wadesboro, North Carolina, and Xxxxxxxx & Company, ("F&C"),
Hurst, Texas, under the terms of which Xxxxx has engaged F&C, in connection with
its conversion from mutual to stock form, to (1) determine the pro forma market
value of the shares of common stock to be issued and sold by Anson or its
holding company; and (2) assist Anson in preparing a business plan to be filed
with the application for approval to convert to stock.
F&C agrees to deliver the written valuation and business plan to Anson at
the above address on or before a mutually agreed upon date and to meet and
consult with the Board of Directors of Anson with regard to both the written
valuation and the business plan. Further, F&C agrees to perform such other
services as are necessary or required in connection with comments from the
applicable regulatory authorities relating to the business plan and appraisal
and the preparation of appraisal updates as requested by Xxxxx or its counsel.
It is understood that the services of F&C under this agreement shall be limited
as herein described.
F&C's fee for the business plan and initial appraisal valuation report and
any required updates shall be $25,000 ($10,000 for the business plan and $15,000
for the appraisal). In addition, Xxxxx shall reimburse F&C for all out-of-
pocket expenses. Payment under this agreement shall be made as follows:
1. Upon execution of this engagement letter -- $7,500;
2. Upon issuance of the business plan -- $7,500;
3. Upon issuance of the appraisal -- $7,500; and
4. Upon completion of the conversion -- $2,500.
5. Out-of-pocket expenses are to be paid monthly.
If, during the course of Anson's conversion, unforeseen events occur so as
to change materially the nature or the work content of the services described in
this contract, the terms of the contract shall be subject to renegotiation.
Such unforeseen events shall include, but not be limited to, major changes in
the conversion regulations, appraisal guidelines or processing
Board of Directors
November 12, 1997
Page 2
procedures as they relate to conversion appraisals, major changes in Anson's
management or operating policies, execution of a merger agreement with another
institution prior to completion of conversion, and excessive delays or
suspension of processing of conversions by the regulatory authorities such that
completion of Anson's conversion requires the preparation by F&C of a new
appraisal report or business plan, excluding appraisal updates during the course
of the engagement.
To induce F&C to provide the services described above, Xxxxx hereby agrees
as follows:
1. Anson shall supply to F&C such information with respect to its business
and financial condition as F&C reasonably may request in order to make
the aforesaid valuation. Such information made available to F&C shall
include, but not be limited to, annual financial statements, periodic
regulatory filings, material agreements, debt instruments and corporate
books and records.
2. Anson hereby represents and warrants, to the best of its knowledge, that
any information provided to F&C does not and will not, at any time
relevant hereto, contain any misstatement or untrue statement of a
material fact or omit any and all material facts required to be stated
therein or necessary to make the statements therein not false or
misleading in light of the circumstances under which they were made.
3. Xxxxx shall indemnify and hold harmless F&C and any employees of F&C who
act for or on behalf of F&C in connection with the services called for
under this agreement, from and against any and all loss, cost, damage,
claim, liability or expense of any kind, including reasonable attorneys
fees and other expenses incurred in investigating, preparing to defend
and defending any claim or claims (specifically including, but not
limited to, claims under federal and state securities laws) arising out
of any misstatement or untrue statement of a material fact contained in
the information supplied by Xxxxx to F&C or by an omission to state a
material fact in the information so provided which is required to be
stated therein in order to make the statement therein not false or
misleading.
4. F&C shall not be entitled to indemnification pursuant to Paragraph 3
above with regard to any claim arising where, with regard to the basis
for such claim, F&C had knowledge that a statement of a fact material to
the evaluation and contained in the information supplied by Xxxxx was
untrue or had knowledge that a material fact was omitted from the
information so provided and that such material fact was necessary in
order to make the statement made to F&C not false or misleading.
Board of Directors
November 12, 1997
Page 3
5. F&C additional shall not be entitled to indemnification pursuant to
Paragraph 3 above notwithstanding its lack of actual knowledge of an
intentional misstatement or omission of a material fact in the
information provided if F&C is determined to have been negligent or to
have failed to exercise due diligence in the preparation of its
valuation.
Xxxxx and F&C are not affiliated, and neither Anson nor F&C has an economic
interest in, or held in common with, the other and has not derived a significant
portion of its gross revenue, receipts or net income for any period from
transactions with the other.
In order for F&C to consider this proposal binding, please acknowledge your
consent to the foregoing by executing the enclosed copies of this letter and
returning one copy to us, together with a check payable to Xxxxxxxx & Company in
the amount of $7,500. The extra copy is for your conversion counsel.
Yours very truly,
Xxxxx X. Xxxxxxx
Principal
Agreed to ($7,500 check enclosed):
Anson Savings Bank, SSB
Wadesboro, North Carolina
By:
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Xxxxxx X. Xxxx, President
