EXHIBIT 1.2
ROCKY FORD FINANCIAL, INC.
ROCKY FORD FEDERAL SAVINGS AND LOAN ASSOCIATION
272,000 TO 423,200 SHARES
COMMON STOCK
(PAR VALUE $0.01 PER SHARE)
$10.00 PER SHARE
SALES AGENCY AGREEMENT
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Trident Securities, Inc.
0000 Xxx Xxxxx Xxxx, Xxxxx 000
Xxxxxxx, Xxxxx Xxxxxxxx 00000
Dear Sirs:
Rocky Ford Financial, Inc., a Delaware-chartered corporation (the
"Company"), and Rocky Ford Federal Savings and Loan Association, a federally
chartered and insured mutual savings association (the "Association"), hereby
confirm, as of __________ __, 1997, their respective agreements with Trident
Securities, Inc. ("Trident"), a broker-dealer registered with the Securities and
Exchange Commission ("Commission") and a member of the National Association of
Securities Dealers, Inc. ("NASD"), as follows:
1. Introductory. The Association intends to convert from a federally
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chartered mutual savings association to a federally chartered stock savings
association as a wholly owned subsidiary of the Company (together with the
Offerings, as defined below, the issuance of shares of common stock of the
Association to the Company and the incorporation of the Company, the
"Conversion") pursuant to a plan of conversion adopted on January 14, 1997 (as
amended, the "Plan"). In accordance with the Plan, the Company is offering
shares of its common stock, par value $0.01 per share (the "Shares" and the
"Common Stock"), pursuant to nontransferable subscription rights in a
subscription offering (the "Subscription Offering") to certain depositors and
borrowers of the Association and to the Association's tax-qualified employee
benefit plans (i.e., the Association's Employee Stock Ownership Plan (the
"ESOP")). In the event of an oversubscription within any subscription priority
category, preference may be given within that category to natural persons and
trusts of natural persons who permanently reside in Xxxxx County, Colorado (the
Association's "Local Community"), but only if such preference becomes permitted
by applicable law and is approved by the Association's Board of Directors in its
sole discretion. Concurrently with the Subscription Offering, shares of the
Common Stock not sold in the Subscription Offering are being offered to the
general public in a community offering, with preference being given to natural
persons and trusts of natural persons permanently residing in the Association's
Local Community (the "Community Offering") (the Subscription and Community
Offerings are sometimes referred to collectively as the "Offerings"), subject to
the right of the Company and the Association, in their absolute discretion, to
reject orders in the Community Offering in whole or in part. In the Offerings,
the Company is offering between 272,000 and 368,000 Shares, with the possibility
of offering up to 423,200 Shares without a resolicitation of subscribers, as
contemplated by Title 12 of the Code of Federal Regulations, Part 563b. No
person, individually or together with associates of and persons acting in
concert
Trident Securities, Inc.
Sales Agency Agreement
Page 2
with such person, may purchase in the aggregate more than the lesser of
5% or $150,000 of the Shares issued in the Conversion.
The Company and the Association have been advised by Trident that it will
utilize its best efforts in assisting the Company and the Association with the
sale of the Shares in the Offerings and, if deemed necessary by the Company in a
syndicated community offering. Prior to the execution of this Agreement, the
Company has delivered to Trident the Prospectus dated __________ __, 1997 (as
hereinafter defined) and all supplements thereto to be used in the Offerings.
Such Prospectus contains information with respect to the Company, the
Association and the Shares.
2. Representations and Warranties.
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(a) The Company and the Association jointly and severally represent
and warrant to Trident that:
(i) The Company has filed with the Commission a registration
statement, including exhibits and an amendment or amendments thereto,
on Form SB-2 (No. 333-_____), including a Prospectus relating to the
Offerings, for the registration of the Shares under the Securities Act
of 1933, as amended (the "Act"); and such registration statement has
become effective under the Act and no stop order has been issued with
respect thereto and no proceedings therefor have been initiated or, to
the Company's best knowledge, threatened by the Commission. Except as
the context may otherwise require, such registration statement, as
amended or supplemented, on file with the Commission at the time the
registration statement became effective, including the Prospectus,
financial statements, schedules, exhibits and all other documents
filed as part thereof, as amended and supplemented, is herein called
the "Registration Statement," and the prospectus, as amended or
supplemented, on file with the Commission at the time the Registration
Statement became effective is herein called the "Prospectus," except
that if the prospectus filed by the Company with the Commission
pursuant to Rule 424(b) of the general rules and regulations of the
Commission under the Act (together with the enforceable published
policies and actions of the Commission thereunder, the "SEC
Regulations") differs from the form of prospectus on file at the time
the Registration Statement became effective, the term "Prospectus"
shall refer to the Rule 424(b) prospectus from and after the time it
is filed with or mailed for filing to the Commission and shall include
any amendments or supplements thereto from and after their dates of
effectiveness or use, respectively. If any Shares remain unsubscribed
following completion of the Subscription Offering and the Community
Offering, the Company (i) will promptly file with the Commission a
post-effective amendment to such Registration Statement relating to
the results of the Subscription and the Community Offerings, any
additional information with respect to the proposed plan of
distribution and any revised pricing information or (ii) if no such
post-
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Sales Agency Agreement
Page 3
effective amendment is required, will file with, or mail for filing
to, the Commission a prospectus or prospectus supplement containing
information relating to the results of the Subscription and the
Community Offerings and pricing information pursuant to Rule 424(c) of
the Regulations, in either case in a form reasonably acceptable to the
Company and Trident.
(ii) The Association has filed an Application for Approval of
Conversion on Form AC, including exhibits (as amended or supplemented,
the "Form AC" and together with the Form H-(e)1-S referred to below,
the "Conversion Application") with the Office of Thrift Supervision
(the "Office") under the Home Owners' Loan Act, as amended (the
"HOLA") and the enforceable rules and regulations, including published
policies and actions, of the Office thereunder (the "OTS
Regulations"), which has been approved by the Office; and the
Prospectus and the proxy statement for the solicitation of proxies
from members for the special meeting to approve the Plan (the "Proxy
Statement") included as part of the Form AC have been approved for use
by the Office. No order has been issued by the Office preventing or
suspending the use of the Prospectus or the Proxy Statement; and no
action by or before the Office revoking such approvals is pending or,
to the Association's best knowledge, threatened. The Company has
filed with the Office the Company's application on Form H-(e)1-S
promulgated under the savings and loan holding company provisions of
the Home Owners' Loan Act and the regulations promulgated thereunder
("HOLA") and has received approval of its acquisition of the
Association from the Office.
(iii) At the date of the Prospectus and at all times subsequent
thereto through and including the Closing Date (i) the Registration
Statement and the Prospectus (as amended or supplemented, if amended
or supplemented) complied with the Act and the Regulations, (ii) the
Registration Statement (as amended or supplemented, if amended or
supplemented) 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 not misleading, and (iii) the
Prospectus (as amended or supplemented, if amended or supplemented)
did not contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which
they were made, not misleading. Representations or warranties in this
subsection shall not apply to statements or omissions made in reliance
upon and in conformity with written information furnished to the
Company or the Association relating to Trident by or on behalf of
Trident expressly for use in the Registration Statement or Prospectus.
Trident Securities, Inc.
Sales Agency Agreement
Page 4
(iv) The Company has been duly incorporated as a Delaware
corporation, and the Association has been duly organized as a mutual
savings association under the laws of the United States, and each of
them is validly existing and in good standing under the laws of the
jurisdiction of its organization with full power and authority to own
its property and conduct its business as described in the Registration
Statement and Prospectus; the Association is a member in good standing
of the Federal Home Loan Bank of Topeka; and the deposit accounts of
the Association are insured by the Savings Association Insurance Fund
("SAIF") administered by the Federal Deposit Insurance Corporation
("FDIC") up to the applicable legal limits. Each of the Company and
the Association is not required to be qualified to do business as a
foreign corporation in any jurisdiction where non-qualification would
have a material adverse effect on the Company and the Association,
taken as a whole. The Association does not own equity securities of
or an equity interest in any business enterprise except as described
in the Prospectus. Upon amendment of the Association's charter and
bylaws as provided in the rules and regulations of the Office and
completion of the sale by the Company of the Shares as contemplated by
the Prospectus, (i) the Association will be converted pursuant to the
Plan to a federally chartered capital stock savings association with
full power and authority to own its property and conduct its business
as described in the Prospectus, (ii) all of the authorized and
outstanding capital stock of the Association will be owned of record
and beneficially by the Company, and (iii) the Company will have no
direct subsidiaries other than the Association.
(v) The Association has good, marketable and insurable title to
all assets material to its business and to those assets described in
the Prospectus as owned by it, free and clear of all material liens,
charges, encumbrances or restrictions, except for liens for taxes not
yet due, except as described in the Prospectus and except as could not
in the aggregate have a material adverse effect upon the operations or
financial condition of the Association; and all of the leases and
subleases material to the operations or financial condition of the
Association, under which it holds properties, including those
described in the Prospectus, are in full force and effect as described
therein.
(vi) The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby have been duly
and validly authorized by all necessary actions on the part of each of
the Company and the Association, and this Agreement is a valid and
binding obligation with valid execution and delivery of each of the
Company and the Association, enforceable in accordance with its terms
(except as the enforceability thereof may be limited by bankruptcy,
insolvency, moratorium, reorganization or similar laws relating to or
affecting the enforcement of creditors' rights generally or the rights
of
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Page 5
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 that the
provisions of Sections 8 and 9 hereof may be unenforceable as against
public policy or pursuant to Section 23A of the Federal Reserve Act,
12 U.S.C. Section 371c ("Section 23A")).
(vii) There is no litigation or governmental proceeding pending
or, to the best knowledge of the Company or the Association,
threatened against or involving the Company, the Association, or any
of their respective assets which individually or in the aggregate
would reasonably be expected to have a material adverse effect on the
condition (financial or otherwise), results of operations and
business, including the assets and properties, of the Company and the
Association, taken as a whole.
(viii) The Company and the Association have received the
opinions of Housley Kantarian & Xxxxxxxxx, P.C. with respect to
federal tax consequences of the Conversion, and of Xxxxxxxx, White &
Company with respect to the Colorado tax consequences of the
Conversion, to the effect that the Conversion will constitute a tax-
free reorganization under the Internal Revenue Code of 1986, as
amended, and will not be a taxable transaction for the Association or
the Company under the laws of Colorado, and the facts relied upon in
such opinions are accurate and complete.
(ix) Each of the Company and the Association has all such
corporate power, authority, authorizations, approvals and orders as
may be required to enter into this Agreement and to carry out the
provisions and conditions hereof, subject to the limitations set forth
herein and subject to the satisfaction of certain conditions imposed
by the Office in connection with its approvals of the Form AC and the
Application H-(e)1-S, and except as may be required under the
securities, or "blue sky," laws of various jurisdictions, and in the
case of the Company, as of the Closing Date, will have such approvals
and orders to issue and sell the Shares to be sold by the Company as
provided herein, and in the case of the Association, as of the Closing
Date, will have such approvals and orders to issue and sell the Shares
of its Common Stock to be sold to the Company as provided in the Plan,
subject to the issuance of amended charter in the form required for
federally chartered stock savings associations (the "Stock Charter"),
the form of which Stock Charter has been approved by the Office.
(x) Neither the Company nor the Association is in violation of
any rule or regulation of the Office or the FDIC that could reasonably
be expected to result in any enforcement action against the Company,
the Association, or their
Trident Securities, Inc.
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Page 6
officers or directors that might have a material adverse effect on the
condition (financial or otherwise), operations, businesses, assets or
properties of the Company and the Association, taken as a whole.
(xi) The consolidated financial statements and any related notes
or schedules which are included in the Registration Statement and the
Prospectus fairly present the consolidated financial condition,
income, retained earnings and cash flows of the Association at the
respective dates thereof and for the respective periods covered
thereby and comply as to form with the applicable accounting
requirements of the Regulations and the applicable accounting
regulations of the Office. Such financial statements have been
prepared in accordance with generally accepted accounting principles
consistently applied throughout the periods involved, except as set
forth therein, and such financial statements are consistent with
financial statements and other reports filed by the Association with
supervisory and regulatory authorities except as such generally
accepted accounting principles may otherwise require. The tables in
the Prospectus accurately present the information purported to be
shown thereby at the respective dates thereof and for the respective
periods therein.
(xii) There has been no material change in the condition
(financial or otherwise), results of operations or business, including
assets and properties, of the Company and the Association, taken as a
whole, since the latest date as of which such condition is set forth
in the Prospectus, except as set forth therein; and the
capitalization, assets, properties and business of each of the Company
and the Association conform to the descriptions thereof contained in
the Prospectus. None of the Company nor the Association has any
material liabilities of any kind, contingent or otherwise, except as
set forth in the Prospectus.
(xiii) There has been no breach or default (or the occurrence of
any event which, with notice or lapse of time or both, would
constitute a default) under, or creation or imposition of any lien,
charge or other encumbrance upon any of the properties or assets of
the Company and the Association pursuant to any of the terms,
provisions or conditions of, any agreement, contract, indenture, bond,
debenture, note, instrument or obligation to which the Company or the
Association is a party or by which any of them or any of their
respective assets or properties may be bound or is subject, or
violation of any governmental license or permit or any enforceable
published law, administrative regulation or order or court order,
writ, injunction or decree, which breach, default, encumbrance or
violation would have a material adverse effect on the condition
(financial or otherwise), operations, business, assets or properties
of the Company and the Association taken as a whole; all agreements
which are material to the condition (financial or otherwise), results
of operations or business of the Company and the
Trident Securities, Inc.
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Page 7
Association taken as a whole are in full force and effect, and no
party to any such agreement has instituted or, to the best knowledge
of the Company and the Association, threatened any action or
proceeding wherein the Company or the Association would be alleged to
be in default thereunder.
(xiv) None of the Company or the Association is in violation of
its respective charter or bylaws. The execution and delivery hereof
and the consummation of the transactions contemplated hereby by the
Company and the Association do not conflict with or result in a breach
of the charter or bylaws of the Company or the Association (in either
mutual or stock form) or constitute a material breach of or default
(or an event which, with notice or lapse of time or both, would
constitute a default) under, give rise to any right of termination,
cancellation or acceleration contained in, or result in the creation
or imposition of any lien, charge or other encumbrance upon any of the
properties or assets of the Company or the Association pursuant to any
of the terms, provisions or conditions of, any material agreement,
contract, indenture, bond, debenture, note, instrument or obligation
to which the Company or the Association is a party or violate any
governmental license or permit or any enforceable published law,
administrative regulation or order or court order, writ, injunction or
decree (subject to the satisfaction of certain conditions imposed by
the Office in connection with its approval of the Conversion
Application), which breach, default, encumbrance or violation would
have a material adverse effect on the condition (financial or
otherwise), operations or business of the Company and the Association
taken as a whole.
(xv) Subsequent to the respective dates as of which information
is given in the Registration Statement and Prospectus and prior to the
Closing Date (as hereinafter defined), except as otherwise may be
indicated or contemplated therein, none of the Company or the
Association has issued any securities which will remain issued at the
Closing Date or incurred any liability or obligation, direct or
contingent, or borrowed money, except borrowings in the ordinary
course of business, or entered into any other transaction not in the
ordinary course of business and consistent with prior practices, which
is material in light of the business of the Company and the
Association, taken as a whole.
(xvi) Upon consummation of the Conversion, the authorized,
issued and outstanding equity capital of the Company shall be within
the range as set forth in the Prospectus under the caption
"Capitalization," and no Common Stock of the Company shall be
outstanding immediately prior to the Closing Date; the issuance and
the sale of the Shares of the Company have been duly authorized by all
necessary action of the Company and approved by the Office and, when
issued in accordance with the terms of the Plan and paid for, shall be
validly issued,
Trident Securities, Inc.
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Page 8
fully paid and nonassessable and shall conform to the description
thereof contained in the Prospectus; the issuance of the Shares is not
subject to preemptive rights, except as set forth in the Prospectus;
and good title to the Shares will be transferred by the Company upon
issuance thereof against payment therefor, free and clear of all
claims, encumbrances, security interests and liens against the Company
whatsoever. The certificates representing the Shares will conform in
all material respects with the requirements of applicable laws and
regulations. The issuance and sale of the capital stock of the
Association to the Company has been duly authorized by all necessary
action of the Association and the Company and appropriate regulatory
authorities (subject to the satisfaction of various conditions imposed
by the Office in connection with its approval of the Conversion
Application), and such capital stock, when issued in accordance with
the terms of the Plan, will be fully paid and nonassessable and will
conform in all material respects to the description thereof contained
in the Prospectus.
(xvii) 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 declaration of effectiveness of any required post-effective
amendment by the Commission and approval thereof by the Office and
approval of the Company's application on Form H-(e)1-S by the Office,
the issuance of the Stock Charter by the Office and as may be required
under the securities laws of various jurisdictions.
(xviii) All contracts and other documents required to be filed
as exhibits to the Registration Statement or the Conversion
Application have been filed with the Commission and/or the Office, as
the case may be.
(xix) Xxxxxxxx, White & Company, which has audited the financial
statements of the Association at September 30, 1996 and 1995 and for
the years ended September 30, 1996 and 1995 included in the
Prospectus, is an independent public accountant within the meaning of
the Code of Professional Ethics of the American Institute of Certified
Public Accountants and Title 12 of the Code of Federal Regulations,
Section 571.2(c)(3).
(xx) For the past five years, the Company and the Association
have timely filed all required federal, state and local franchise tax
returns, and no deficiency has been asserted with respect to such
returns by any taxing authorities, and the Company and the Association
have paid all taxes that have become due and, to the best of their
knowledge, have made adequate reserves for similar future tax
liabilities, except where any failure to make such filings, payments
and reserves, or the assertion of such a deficiency, would not have a
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material adverse effect on the condition of the Company and the
Association taken as a whole.
(xxi) All of the loans represented as assets of the Association
on the most recent financial statements of the Association included in
the Prospectus meet or are exempt from all requirements of federal,
state or local law pertaining to lending, including without limitation
truth in lending (including the requirements of Regulation Z and 12
C.F.R. Part 226 and Section 563.99), real estate settlement
procedures, consumer credit protection, equal credit opportunity and
all disclosure laws applicable to such loans, except for violations
which, if asserted, would not have a material adverse effect on the
Company and the Association taken as a whole.
(xxii) The records of account holders, depositors, borrowers and
other members of the Association delivered to Trident by the
Association or its agent for use during the Conversion have been
prepared or reviewed by the Association and, to the best knowledge of
the Company and the Association, are reliable and accurate.
(xxiii) None of the Company, the Association, or the employees
of the Company or the Association has made any payment of funds of the
Company or the Association prohibited by law, and no funds of the
Company or the Association have been set aside to be used for any
payment prohibited by law.
(xxiv) To the best knowledge of the Company and the Association,
the Company and the Association are in compliance with all laws, rules
and regulations relating to the discharge, storage, handling and
disposal of hazardous or toxic substances, pollutants or contaminants
and neither the Company nor the Association believes that the Company
or the Association is subject to liability under the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as
amended, or any similar law, except for violations which, if asserted,
would not have a material adverse effect on the Company and the
Association, taken as a whole. There are no actions, suits,
regulatory investigations or other proceedings pending or, to the best
knowledge of the Company or the Association, threatened against the
Company or the Association relating to the discharge, storage,
handling and disposal of hazardous or toxic substances, pollutants or
contaminants. To the best knowledge of the Company and the
Association, no disposal, release or discharge of hazardous or toxic
substances, pollutants or contaminants, including petroleum and gas
products, as any of such terms may be defined under federal, state or
local law, has been caused by the Company or the Association or, to
the best knowledge of the Company or the Association, has occurred on,
in or at any of the facilities or
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properties of the Company or the Association, except such disposal,
release or discharge which would not have a material adverse effect on
the Company and the Association, taken as a whole.
(xxv) At the Closing Date, the Company and the Association will
have completed the conditions precedent to, and shall have conducted
the Conversion in all material respects in accordance with, the Plan,
the OTS Regulations and all other applicable laws, regulations,
published decisions and orders, including all terms, conditions,
requirements and provisions precedent to the Conversion imposed by the
Office.
(b) Trident represents and warrants to the Company and the
Association that:
(i) Trident is registered as a broker-dealer with the
Commission, and is in good standing with the Commission and the NASD.
(ii) Trident is validly existing as a corporation in good
standing under the laws of its jurisdiction of incorporation, with
full corporate power and authority to provide the services to be
furnished to the Company and the Association hereunder.
(iii) 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 Trident,
and this Agreement is a legal, valid and binding obligation of
Trident, 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 registered broker-dealers accounts of whose may be
protected by the Securities Investor Protection Corporation 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 that the provisions of Sections 8 and 9 hereof may be
unenforceable as against public policy or pursuant to Section 23A).
(iv) Each of Trident and, to Trident's knowledge, its employees,
agents and representatives who shall perform any of the services
required hereunder to be performed by Trident shall be duly authorized
and shall have all licenses, approvals and permits necessary to
perform such services, and Trident is a registered selling agent in
the jurisdictions listed in Exhibit A hereto and will remain
registered in such jurisdictions in which the Company is relying on
such registration for the sale of the Shares, until the Conversion is
consummated or terminated.
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(v) The execution and delivery of this Agreement by Trident, the
fulfillment of the terms set forth herein and the consummation of the
transactions contemplated hereby shall not violate or conflict with
the corporate charter or bylaws of Trident or violate, conflict with
or constitute a breach of, or default (or an event which, with notice
or lapse of time, or both, would constitute a default) under, any
material agreement, indenture or other instrument by which Trident is
bound or under any governmental license or permit or any law,
administrative regulation, authorization, approval or order or court
decree, injunction or order.
(vi) Any funds received by Trident to purchase Common Stock will
be handled in accordance with Rule 15c2-4 under the Securities
Exchange Act of 1934, as amended (the "Exchange Act").
(vii) There is not now pending or, to Trident's knowledge,
threatened against Trident any action or proceeding before the
Commission, the NASD, any state securities commission or any state or
federal court concerning Trident's activities as a broker-dealer.
3. Employment of Trident; Sale and Delivery of the Shares. On the basis
------------------------------------------------------
of the representations and warranties herein contained, but subject to the terms
and conditions herein set forth, the Company and the Association hereby employ
Trident as their agent to utilize its best efforts in assisting the Company with
the Company's sale of the Shares in the Subscription Offering and Community
Offering. The employment of Trident hereunder shall terminate (a) forty-five
(45) days after the Subscription and Community Offering closes, unless the
Company and the Association, with the approval of the Office, are permitted to
extend such period of time, or (b) upon consummation of the Conversion,
whichever date shall first occur.
In the event the Company is unable to sell a minimum of 272,000 Shares (or
such lesser amount as the Office may permit) within the period herein provided,
this Agreement shall terminate, and the Company and the Association shall refund
promptly to any persons who have subscribed for any of the Shares, the full
amount which it may have received from them, together with interest as provided
in the Prospectus, and no party to this Agreement shall have any obligation to
the other party hereunder, except as set forth in Sections 6, 8(a) and 9 hereof.
Appropriate arrangements for placing the funds received from subscriptions for
Shares in special interest-bearing accounts with the Association until all
Shares are sold and paid for were made prior to the commencement of the
Subscription and Community Offering, with provision for prompt refund to the
purchasers as set forth above, or for delivery to the Company if all Shares are
sold.
If all conditions precedent to the consummation of the Conversion are
satisfied, including the sale of all Shares required by the Plan to be sold, the
Company agrees to issue or have issued such Shares and to release for delivery
certificates to subscribers thereof for such Shares
Trident Securities, Inc.
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Page 12
on the Closing Date against payment to the Company by any means authorized
pursuant to the Prospectus, at the principal office of the Company at 801 Xxxxx
Avenue, Rocky Ford, Colorado or at such other place as shall be agreed upon
between the parties hereto. The date upon which Trident is paid the compensation
due hereunder is herein called the "Closing Date."
Trident agrees either (a) upon receipt of an executed order form of a
subscriber to forward the offering price of the Common Stock ordered on or
before twelve noon on the next business day following receipt or execution of an
order form by Trident to the Association for deposit in a segregated account or
(b) to solicit indications of interest in which event (i) Trident will
subsequently contact any potential subscriber indicating interest to confirm the
interest and give instructions to execute and return an order form or to receive
authorization to execute the order form on the subscriber's behalf, (ii) Trident
will mail acknowledgements of receipt of orders to each subscriber confirming
interest on the business day following such confirmation, (iii) Trident will
debit accounts of such subscribers on the third business day ("debit date")
following receipt of the confirmation referred to in (i), and (iv) Trident will
forward completed order forms together with such funds to the Association on or
before twelve noon on the next business day following the debit date for deposit
in a segregated account. Trident acknowledges that if the procedure in (b) is
adopted, subscribers' funds are not required to be in their accounts until the
debit date.
In addition to the expenses specified in Section 6 hereof, Trident shall
receive the following compensation for its services hereunder:
(a) A commission equal to 2.35% of the aggregate dollar amount of
Common Stock sold to residents in the State of Colorado in the Subscription
and Community Offerings, and a commission of 1.50% of the aggregate dollar
amount of Common Stock sold to residents outside the State of Colorado in
the Subscription and Community Offerings. All such fees are to be payable
in next-day funds to Trident on the Closing Date. No commissions shall be
payable on shares purchased by officers, directors, employees or their
associates or employee plans. Further, all commissions shall be based on
the amount of stock sold; however, commissions shall be capped at the
midpoint of the final appraised value. In addition, in the event that the
offering is closed above the midpoint appraised value as stated on the
final Prospectus cover, the above described commissions schedule shall be
applied on a pro rata basis as if the offering had closed at the midpoint
of valuation range.
(b) For stock sold by other NASD member firms under selected dealer's
agreements, the commission shall not exceed a fee to be agreed upon jointly
by Trident and the Association to reflect market requirements at the time
of the stock allocation in a Syndicated Community Offering.
Trident Securities, Inc.
Sales Agency Agreement
Page 13
(c) Trident shall be reimbursed for allocable expenses, incurred by
it whether or not the Offerings are successfully completed; provided,
however, that reimbursable legal fees will not exceed $26,500 (excluding
out of pocket expenses), that other reimbursable expenses will not exceed
$11,000 and that neither the Company nor the Association shall pay or
reimburse Trident for any of the foregoing expenses accrued after Trident
shall have notified the Company or the Association of its election to
terminate this Agreement pursuant to Section 11 hereof or after such time
as the Company or the Association shall have given notice in accordance
with Section 12 hereof that Trident is in breach of this Agreement. Full
payment to defray Trident's reimbursable expenses shall be made in next-day
funds on the Closing Date or, if the Conversion is not completed and is
terminated for any reason, within ten (10) business days of receipt by the
Company of a written request from Trident for reimbursement of its
expenses. Trident acknowledges receipt of $11,000 advance payment from the
Association which shall be credited against the total reimbursement due
Trident hereunder.
(c) Notwithstanding the limitations on reimbursement of Trident for
allocable expenses provided in the immediately preceding paragraph (b), in
the event that a resolicitation or other event causes the Offerings to be
extended beyond their original expiration date, Trident shall be reimbursed
for its allocable expenses incurred during such extended period, provided
that the allowance for allocable expenses provided for in the immediately
preceding paragraph (b) above have been exhausted and subject to the
following. Such reimbursement shall be in amount equal to the product
obtained by dividing $11,000 (original out-of-pocket expenses) by the total
number of days of the unextended Subscription Offering (calculated from the
date of the Prospectus to the intended close of the Subscription Offering
as stated in the Prospectus) and multiplying such product by the number of
days of the extension (that number of days from the date of the
supplemental prospectus used in the extended Subscription Offering to the
closing of the extension of the Subscription Offering described in such
supplemental prospectus).
The Company shall pay any stock issue and transfer taxes which may be
payable with respect to the sale of the Shares. The Company and the Association
shall also pay all expenses of the Conversion incurred by them or on their prior
approval including but not limited to their attorneys' fees, NASD filing fees,
and attorneys' fees relating to any required state securities laws research and
filings, telephone charges, air freight, rental equipment, supplies, transfer
agent charges, fees relating to auditing and accounting and costs of printing
all documents necessary in connection with the Conversion.
Trident Securities, Inc.
Sales Agency Agreement
Page 14
4. Offering. Subject to the provisions of Section 7 hereof, Trident is
--------
assisting the Company on a best efforts basis in offering a minimum of 272,000
and a maximum of 368,000 Shares, with the possibility of offering up to 423,200
Shares (except as the Office may permit to be decreased or increased) in the
Subscription and Community Offerings. The Shares are to be offered to the
public at the price set forth on the cover page of the Prospectus and the first
page of this Agreement.
5. Further Agreements. The Company and the Association jointly and
------------------
severally covenant and agree that:
(a) The Company shall deliver to Trident, from time to time, such
number of copies of the Prospectus as Trident reasonably may request. The
Company authorizes Trident to use the Prospectus in any lawful manner in
connection with the offer and sale of the Shares.
(b) The Company will notify Trident immediately upon discovery, and
confirm the notice in writing, (i) when any post-effective amendment to the
Registration Statement becomes effective or any supplement to the
Prospectus has been filed, (ii) of the issuance by the Commission of any
stop order relating to the Registration Statement or of the initiation or
the threat of any proceedings for that purpose, (iii) of the receipt of any
notice with respect to the suspension of the qualification of the Shares
for offering or sale in any jurisdiction, and (iv) of the receipt of any
comments from the staff of the Commission relating to the Registration
Statement. If the Commission enters a stop order relating to the
Registration Statement at any time, the Company will make every reasonable
effort to obtain the lifting of such order at the earliest possible moment.
(c) During the time when a prospectus is required to be delivered
under the Act, the Company will comply so far as it is able with all
requirements imposed upon it by the Act, as now in effect and hereafter
amended, and by the Regulations, as from time to time in force, so far as
necessary to permit the continuance of offers and sales of or dealings in
the Shares in accordance with the provisions hereof and the Prospectus. If
during the period when the Prospectus is required to be delivered in
connection with the offer and sale of the Shares any event relating to or
affecting the Company and the Association, taken as a whole, shall occur as
a result of which it is necessary, in the opinion of counsel for Trident,
with the concurrence of counsel to the Company, to amend or supplement the
Prospectus in order to make the Prospectus not false or misleading in light
of the circumstances existing at the time it is delivered to a purchaser of
the Shares, the Company forthwith shall prepare and furnish to Trident a
reasonable number of copies of an amendment or amendments or of a
supplement or supplements to the Prospectus (in form and substance
satisfactory to counsel for Trident) which shall amend or supplement the
Prospectus so that, as amended or supplemented, the Prospectus shall not
contain an untrue statement of a material fact or omit to state a material
fact
Trident Securities, Inc.
Sales Agency Agreement
Page 15
necessary in order to make the statements therein, in light of the
circumstances existing at the time the Prospectus is delivered to a
purchaser of the Shares, not misleading. The Company will not file or use
any amendment or supplement to the Registration Statement or the Prospectus
of which Trident has not first been furnished a copy or to which Trident
shall reasonably object after having been furnished such copy. For the
purposes of this subsection the Company and the Association shall furnish
such information with respect to themselves as Trident from time to time
may reasonably request.
(d) The Company and the Association have taken or will take all
reasonably necessary action as may be required to qualify or register the
Shares for offer and sale by the Company under the securities or blue sky
laws of such jurisdictions as Trident and either the Company or its counsel
may agree upon; provided, however, that the Company shall not be obligated
to qualify as a foreign corporation to do business under the laws of any
such jurisdiction. In each jurisdiction where such qualification or
registration shall be effected, the Company, unless Trident agrees that
such action is not necessary or advisable in connection with the
distribution of the Shares, shall file and make such statements or reports
as are, or reasonably may be, required by the laws of such jurisdiction.
(e) Appropriate entries will be made in the financial records of the
Association sufficient to establish a liquidation account for the benefit
of eligible account holders as of December 31, 1995 and supplemental
eligible account holders as of March 31, 1997 in accordance with the
requirements of the Office.
(f) The Company will file a registration statement for the Common
Stock under Section 12(g) of the Exchange Act, prior to completion of the
stock offering pursuant to the Plan and shall request that such
registration statement be effective upon completion of the Conversion. The
Company shall maintain the effectiveness of such registration for a minimum
period of three years or for such shorter period as may be required by
applicable law.
(g) The Company will make generally available to its security holders
as soon as practicable, but not later than 45 days after the close of the
period covered thereby, an earnings statement (in form complying with the
provisions of Rule 158 of the regulations promulgated under the Act)
covering a twelve-month period beginning not later than the first day of
the Company's fiscal quarter next following the effective date (as defined
in said Rule 158) of the Registration Statement.
(h) For a period of three (3) years from the date of this Agreement
(unless the Common Stock shall have been deregistered under the Exchange
Act), the Company will furnish to Trident, as soon as publicly available
after the end of each fiscal year, a copy of its annual report to
shareholders for such year; and the Company will furnish to
Trident Securities, Inc.
Sales Agency Agreement
Page 16
Trident (i) as soon as publicly available, a copy of each report or
definitive proxy statement of the Company filed with the Commission under
the Exchange Act or mailed to shareholders, and (ii) from time to time,
such other public information concerning the Company as Trident may
reasonably request.
(i) The Company shall use the net proceeds from the sale of the Shares
consistently with the manner set forth in the Prospectus.
(j) The Company shall not deliver the Shares until each and every
condition set forth in Section 7 hereof has been satisfied, unless such
condition is waived by Trident.
(k) The Company shall advise Trident, if necessary, as to the
allocation of deposits, in the case of eligible account holders and
supplemental eligible account holders and votes, in the case of other
members, and of the Shares in the event of an oversubscription and shall
provide Trident final instructions as to the allocation of the Shares
("Allocation Instructions") in such event and such information shall be
accurate and reliable. Trident shall be entitled to rely on such
instructions and shall have no liability in respect of its reliance
thereon, including without limitation, no liability for or related to any
denial or grant of a subscription in whole or in part.
(l) The Company and the Association will take such actions and furnish
such information as are reasonably requested by Trident in order for
Trident to ensure compliance with the NASD's "Interpretation Relating to
Free-Riding and Withholding."
6. Payment of Expenses. Whether or not the Conversion is consummated,
-------------------
the Company and the Association shall pay or reimburse Trident for (a) all
filing fees paid or incurred by Trident in connection with all filings with the
NASD with respect to the Subscription and Community Offerings and, (b) in
addition, if the Company is unable to sell a minimum of 272,000 Shares or such
lesser amount as the Office may permit or the Conversion is otherwise
terminated, the Company and the Association shall reimburse Trident for
allocable expenses incurred by Trident relating to the offering of the Shares as
provided in Section 3 hereof; provided, however, that neither the Company nor
the Association shall pay or reimburse Trident for any of the foregoing expenses
accrued after Trident shall have notified the Company or the Association of its
election to terminate this Agreement pursuant to Section 11 hereof or after such
time as the Company or the Association shall have given notice in accordance
with Section 12 hereof that Trident is in breach of this Agreement.
7. Conditions of Trident's Obligations. Except as may be waived by
-----------------------------------
Trident, the obligations of Trident as provided herein shall be subject to the
accuracy of the representations and warranties contained in Section 2 hereof as
of the date hereof and as of the Closing Date,
Trident Securities, Inc.
Sales Agency Agreement
Page 17
to the performance by the Company and the Association of their obligations
hereunder and to the following conditions:
(a) At the Closing Date, Trident shall receive the favorable opinions
of Housley Kantarian & Xxxxxxxxx, X.X., special counsel for the Company and
the Association, or ________________________, counsel to the Association,
dated the Closing Date, addressed to Trident, in form and substance
reasonably satisfactory to counsel for Trident and to the effect that:
(i) the Company has been duly incorporated, and is validly
existing as a corporation in good standing under the laws of its
jurisdiction of incorporation, and the Association is validly existing
as a mutual savings association in good standing under the laws of the
United States, each with full power and authority to own its
properties and conduct its business as described in the Prospectus;
(ii) each of the Company and the Association has been qualified
to do business and, to such counsel's knowledge, is in good standing
as a foreign corporation in each jurisdiction where the ownership or
leasing of its properties or the conduct of its business requires such
qualification or, if not so qualified and in good standing, failure to
so qualify would not have any material adverse effect on the Company
and the Association, taken as a whole;
(iii) the Association is a member of the Federal Home Loan Bank
of Topeka, and the deposit accounts of the Association are insured by
the SAIF up to the applicable legal limits;
(iv) to the knowledge of such counsel, the activities of the
Association as such activities are described in the Prospectus are
permitted under federal, Delaware and Colorado law to subsidiaries of
a Delaware business corporation and the Association does not have any
subsidiaries;
(v) to the knowledge of such counsel, the Association has
obtained all licenses, permits and other governmental authorizations
currently required for the conduct of its business as such business is
described in the Prospectus, all such licenses, permits and other
governmental authorizations are in full force and effect and the
Association is in all material respects complying therewith, except
where the failure to hold such licenses, permits or governmental
authorizations or the failure to so comply would not have a material
adverse effect on the Company and the Association, taken as a whole;
Trident Securities, Inc.
Sales Agency Agreement
Page 18
(vi) the Plan complies with, and, to the knowledge of such
counsel, the Conversion of the Association from a federally chartered
mutual savings association to a federally chartered stock savings
association and the creation of the Company as a holding company for
the Association have been effected in all material respects in
accordance with, the HOLA and the OTS Regulations; to such counsel's
knowledge, all of the terms, conditions, requirements and provisions
with respect to the Plan and the Conversion imposed by the Office,
except with respect to the filing or submission of certain required
post-Conversion reports or other materials by the Company or the
Association, have been complied with by the Company and the
Association; and, to the knowledge of such counsel, no person has
sought to obtain regulatory or judicial review of the final action of
the Office in approving the Plan;
(vii) the Company and Association have authorized Common Stock
as set forth in the Registration Statement and the Prospectus, and the
description of such Common Stock in the Registration Statement and the
Prospectus is accurate in all material respects;
(viii) the issuance and sale of the Shares have been duly and
validly authorized by all necessary corporate action on the part of
the Company; the Shares, upon receipt of payment and issuance in
accordance with the terms of the Plan and this Agreement, will be
validly issued, fully paid, nonassessable and, except as disclosed in
the Prospectus, free of preemptive rights, and good title thereto
shall be transferred by the Company free and clear of all claims,
encumbrances, security interests and liens created by the Company;
(ix) the certificates for the Shares are in proper form and
comply in all material respects with applicable Delaware law;
(x) the issuance and sale of the capital stock of the
Association to the Company have been duly authorized by all necessary
corporate action of the Association and the Company and have received
the approval of the Office, and such capital stock, upon receipt of
payment and issuance in accordance with the terms of the Plan, will be
validly issued, fully paid and nonassessable and owned of record and,
to the knowledge of such counsel, beneficially by the Company;
(xi) subject to the satisfaction of the conditions to the
Office's approval of the Conversion Application, no further approval,
authorization, consent or other order of any public board or body is
required in connection with the execution and delivery of this
Agreement, the issuance of the Shares and the consummation of the
Conversion, except with respect to the issuance to the
Trident Securities, Inc.
Sales Agency Agreement
Page 19
Association of the Stock Charter by the Office and as may be required
under the "blue sky" laws of various jurisdictions;
(xii) the execution and delivery of this Agreement and the
consummation of the Conversion have been duly and validly authorized
by all necessary corporate action on the part of each of the Company
and the Association; and this Agreement is a legal, valid and binding
obligation of each of the Company and the Association, enforceable in
accordance with its terms (except as the enforceability thereof may be
limited by bankruptcy, insolvency, moratorium, reorganization,
receivership, conservatorship or similar laws relating to or affecting
the enforcement of creditors' rights generally or the rights of
creditors of depository institutions whose accounts are insured by the
FDIC or 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 that the
provisions of Sections 8 and 9 hereof may be unenforceable as against
public policy or pursuant to Section 23A, as to which no opinion need
be rendered);
(xiii) there are no material legal or governmental proceedings
pending or, to the knowledge of such counsel, threatened against or
involving the assets of the Company or the Association (provided that
for this purpose such counsel need not regard any litigation or
governmental procedure to be "threatened" unless the potential
litigant or government authority has manifested to the management of
the Company or the Association, or to such counsel, a present
intention to initiate such litigation or proceeding);
(xiv) the statements in the Prospectus and incorporated by
reference in the Proxy Statement under the captions "Business of the
Association--Lending Activities," "Regulation," "Taxation,"
"Dividends," "Certain Restrictions on Acquisition of the Company and
the Association" and "Description of Capital Stock," insofar as they
are, or refer to, statements of law or legal conclusions (excluding
financial data included therein, as to which an opinion need not be
expressed), have been prepared or reviewed by such counsel and are
correct in all material respects;
(xv) the Form AC has been approved by the Office, and the
Prospectus and the Proxy Statement have been authorized for use by the
Office; the Registration Statement and any post-effective amendment
thereto has been declared effective by the Commission; except as to
any necessary qualifications or registration under the securities laws
of the jurisdictions in which the Shares were offered, no further
approval of any governmental authority is required for the issuance
and sale of the Shares (subject to the satisfaction of various
Trident Securities, Inc.
Sales Agency Agreement
Page 20
conditions subsequent imposed by the Office in connection with its
approval of the Conversion Application), and no proceedings are
pending by or before the Commission or the Office seeking to revoke or
rescind the orders declaring the Registration Statement effective or
approving the Conversion Application or, to the knowledge of such
counsel, are contemplated or threatened (provided that for this
purpose such counsel need not regard any litigation or governmental
procedure to be "threatened" unless the potential litigant or
government authority has manifested to the management of the Company
or the Association, or to such counsel, a present intention to
initiate such litigation or proceeding);
(xvi) the execution and delivery of this Agreement and the
consummation of the Conversion by the Company and the Association do
not conflict with or result in a breach of the charter or bylaws of
the Company or the Association (in either mutual or stock form) or, to
the best knowledge of such counsel, constitute a material breach of or
default (or an event which, with notice or lapse of time or both,
would constitute a default) under, give rise to any right of
termination, cancellation or acceleration contained in, or result in
the creation or imposition of any lien, charge or other encumbrance
upon any of the properties or assets of the Company or the Association
pursuant to any of the terms, provisions or conditions of, any
material agreement, contract, indenture, bond, debenture, note,
instrument or obligation to which the Company or the Association is a
party or violate any governmental license or permit or any enforceable
published law, administrative regulation or order or court order,
writ, injunction or decree (subject to the satisfaction of certain
conditions imposed by the Office in connection with its approval of
the Conversion Application), which breach, default, encumbrance or
violation would have a material adverse effect on the condition
(financial or otherwise), operations, business, assets or properties
of the Company and the Association taken as a whole;
(xvii) to the knowledge of such counsel, there has been no
material breach of any provision of the Company's or the Association's
charter or bylaws or breach or default (or the occurrence of any event
which, with notice or lapse of time or both, would constitute a
default) under any agreement, contract, indenture, bond, debenture,
note, instrument or obligation to which the Company or the Association
is a party or by which any of them or any of their respective assets
or properties may be bound, or any governmental license or permit, or
a violation of any enforceable published law, administrative
regulation or order, or court order, writ, injunction or decree which
breach, default, encumbrance or violation would have a material
adverse effect on the condition (financial or otherwise), operations,
business, assets or properties of the Company and the Association
taken as a whole; and,
Trident Securities, Inc.
Sales Agency Agreement
Page 21
(xviii) the Conversion Application, the Registration Statement,
the Prospectus and the Proxy Statement, in each case as amended,
comply as to form in all material respects with the requirements of
the Act, the HOLA, the SEC Regulations and the OTS Regulations, as the
case may be (except as to information with respect to Trident included
therein and financial statements, notes to financial statements,
financial tables and other financial and statistical data, including
the appraisal, included therein, as to which an opinion need not be
expressed); to such counsel's knowledge, all documents and exhibits
required to be filed with the Conversion Application and the
Registration Statement have been so filed and the descriptions in the
Conversion Application and the Registration Statement of such
documents and exhibits are accurate in all material respects.
In rendering such opinions, such counsel may rely as to matters of
fact on certificates of officers and directors of the Company and the
Association and certificates of public officials delivered pursuant hereto.
Such counsel may assume that any agreement is the valid and binding
obligation of any parties to such agreement other than the Company and the
Association. Such opinions may be governed by, and interpreted in
accordance with, the Legal Opinion Accord (the "Accord") of the ABA Section
of Business Law (1991), and, as a consequence, references in such opinions
to such counsel's "knowledge" may be limited to "actual knowledge" as
defined in the Accord (or knowledge based on certificates). Such opinions
may be limited to present statutes, regulations and judicial
interpretations and to facts as they presently exist; in rendering such
opinions, such counsel need assume no obligation to revise or supplement
them 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 regulations or any policy statements issued
by any regulatory agency, whether or not promulgated pursuant to any such
legislation, would affect the validity of the execution and delivery by the
Company and the Association of this Agreement or the issuance of the
Shares.
(b) At the Closing Date, Trident shall receive the letters of Housley
Kantarian & Xxxxxxxxx, P.C., special counsel for the Company and the
Association, dated the Closing Date, addressed to Trident, in form and
substance reasonably satisfactory to counsel for Trident and to the effect
that: (i) based on such counsel's participation in conferences with
representatives of the Company, the Association, its counsel, the
independent appraiser, the independent certified public accountants,
Trident and its counsel, review of documents and understanding of
applicable law (including the requirements of Form SB-2 and the character
of the Registration Statement contemplated thereby) and the experience such
counsel has gained in its practice under the Act, nothing has come to such
counsel's attention that would lead it to believe that the Registration
Statement, as amended (except as to information in respect of Trident
contained therein
Trident Securities, Inc.
Sales Agency Agreement
Page 22
and except as to the financial statements, notes to financial statements,
financial tables and other financial and statistical data contained
therein, as to which such counsel need express no comment), at the time it
became effective contained any untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary
to make the statements made therein, in light of the circumstances under
which they were made, not misleading, or that the Prospectus, as amended
(except as to information in respect of Trident contained therein and
except as to financial statements, notes to financial statements, financial
tables and other financial and statistical data contained therein as to
which such counsel need express no comment), at the time the Prospectus was
filed with the Commission under Rule 424(b) and at the Closing Date,
contained any untrue statement of a material fact or omitted to state a
material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading (in making this
statement such counsel may state that it has not undertaken to verify
independently the information in the Registration Statement or Prospectus
and, therefore, does not assume any responsibility for the accuracy or
completeness thereof), and (ii) based on such counsel's participation in
conferences with representatives of the Company and the Association
concerning the Association and the Company, and their counsel, Housley
Kantarian & Xxxxxxxxx, P.C. ("HKB"), nothing has come to such counsel's
attention that would lead it to believe that Trident should not rely on the
legal opinion of ____________________________________________ delivered
under Section 7(a) hereof (in making this statement, HKB may state, if
true, that its members are not licensed to practice law in Colorado, it has
not undertaken to research legal matters or issues involved in
_______________________________'s opinion and it has not undertaken to
verify independently factual information relied upon in
____________________________________'s opinion and, therefore, it does not
render any opinion with respect to _____________________________________'s
opinion and it does not assume responsibility for the accuracy or
completeness of _______________________________'s opinion).
(c) Counsel for Trident shall have been furnished such documents as
they reasonably may require for the purpose of enabling them to review or
pass upon the matters required by Trident, and for the purpose of
evidencing the accuracy, completeness or satisfaction of any of the
representations, warranties or conditions herein contained, including but
not limited to, resolutions of the Board of Directors of the Company and
the Association regarding the authorization of this Agreement and the
transactions contemplated hereby.
(d) Prior to and at the Closing Date, in the reasonable opinion of
Trident, (i) there shall have been no material change in the condition,
financial or otherwise, business or results of operations of the Company
and the Association, taken as a whole, since the latest date as of which
such condition is set forth in the Prospectus, except as referred to
therein; (ii) there shall have been no transaction entered into by the
Company and the Association after the latest date as of which the financial
condition of the Company or
Trident Securities, Inc.
Sales Agency Agreement
Page 23
the Association is set forth in the Prospectus other than transactions
referred to or contemplated therein, transactions in the ordinary course of
business, and transactions which are not material to the Company and the
Association, taken as a whole; (iii) none of the Company or the Association
shall have received from the Office or Commission any direction (oral or
written) to make any change in the method of conducting their respective
businesses which is material to the business of the Company and the
Association, taken as a whole, with which they have not complied; (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 threatened against the Company or the Association or affecting any of
their respective assets, wherein an unfavorable decision, ruling or finding
would have a material adverse effect on the business, operations, financial
condition or income of the Company and the Association, taken as a whole;
and (v) the Shares shall have been qualified or registered for offering and
sale by the Company under the securities or blue sky laws of such
jurisdictions as Trident and the Company shall have agreed upon.
(e) At the Closing Date, Trident shall receive a certificate of the
principal executive officer and the principal financial officer of each of
the Company and the Association, dated the Closing Date, to the effect
that: (i) they have examined the Prospectus and, at the time the Prospectus
became authorized by the Company for use, the Prospectus did 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 with respect to
the Company or the Association; (ii) since the date the Prospectus became
authorized by the Company for 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 change in the business, condition (financial or otherwise) or
results of operations of the Company or the Association and, the conditions
set forth in clauses (ii) through (iv) inclusive of subsection (d) of this
Section 7 have been satisfied; (iii) to the best knowledge of such
officers, no order has been issued by the Commission or the Office to
suspend the Subscription Offering or the Community Offering or the
effectiveness of the Prospectus, and no action for such purposes has been
instituted or threatened by the Commission or the Office; (iv) to the best
knowledge of such officers, no person has sought to obtain review of the
final actions of the Office and division approving the Plan; and (v) all of
the representations and warranties contained in Section 2 of this Agreement
are true and correct, with the same force and effect as though expressly
made on the Closing Date.
(f) At the Closing Date, Trident shall receive, among other documents,
(i) copies of the letters from the Office authorizing the use of the
Prospectus and the Proxy Statement, (ii) a copy of the order of the
Commission declaring the Registration Statement effective; (iii) copies of
the letters from the Office evidencing the corporate
Trident Securities, Inc.
Sales Agency Agreement
Page 24
existence of the Association; (iv) a copy of the letter from the
appropriate Delaware authority evidencing the incorporation (and, if
generally available from such authority, good standing) of the Company; (v)
a copy of the Company's corporate charter certified by the appropriate
Delaware governmental authority; and, (vi) if available, a copy of the
letter from the Office approving the Association's Stock Charter.
(g) As soon as available after the Closing Date, Trident shall receive
a copy of the Association's certified Federal Stock Charter executed by the
appropriate federal governmental authority.
(h) Concurrently with the execution of this Agreement, Trident
acknowledges receipt of a letter from Xxxxxxxx, White & Company,
independent certified public accountants, addressed to Trident and the
Company, in substance and form satisfactory to counsel for Trident, with
respect to the financial statements and certain financial information
contained in the Prospectus.
(i) At the Closing Date, Trident shall receive a letter in form and
substance satisfactory to counsel for Trident from Xxxxxxxx, White &
Company, independent certified public accountants, dated the Closing Date
and addressed to Trident and the Company, confirming the statements made by
them in the letter delivered by them pursuant to the preceding subsection
as of a specified date not more than five (5) days prior to the Closing
Date.
All such opinions, certificates, letters and documents shall be in
compliance with the provisions hereof only if they are, in the reasonable
opinion of Trident and its counsel, satisfactory to Trident and its counsel.
Any certificates signed by an officer or director of the Company or the
Association prepared for Trident's reliance and delivered to Trident or to
counsel for Trident shall be deemed a representation and warranty by the Company
and the Association to Trident as to the statements made therein. If any
condition to Trident's obligations hereunder to be fulfilled prior to or at the
Closing Date is not so fulfilled, Trident may terminate this Agreement or, if
Trident so elects, may waive any such conditions which have not been fulfilled,
or may extend the time of their fulfillment. If Trident terminates this
Agreement as aforesaid, the Company and the Association shall reimburse Trident
for its expenses as provided in Section 3(b) hereof.
8. Indemnification.
---------------
(a) The Company and the Association jointly and severally agree to
indemnify and hold harmless Trident, its officers, directors and employees
and each person, if any, who controls Trident within the meaning of Section
15 of the Act or Section 20(a) of the Exchange Act, against any and all
loss, liability, claim, damage and expense whatsoever and shall further
promptly reimburse such persons for any legal or other expenses
Trident Securities, Inc.
Sales Agency Agreement
Page 25
reasonably incurred by each or any of them in investigating, preparing to
defend or defending against any such action, proceeding or claim (whether
commenced or threatened) arising out of or based upon (A) any
misrepresentation by the Company or the Association in this Agreement or
any breach of warranty by the Company or the Association with respect to
this Agreement or arising out of or based upon any untrue or alleged untrue
statement of a material fact or the omission or alleged omission of a
material fact required to be stated or necessary to make not misleading any
statements contained in (i) the Registration Statement or the Prospectus or
(ii) any application (including the Form AC and the Form H-(e)1-S) or other
document or communication (in this Section 8 collectively called
"Application") prepared or executed by or on behalf of the Company or the
Association or based upon written information furnished by or on behalf of
the Company or the Association, whether or not filed in any jurisdiction,
to effect the Conversion or qualify the Shares under the securities laws
thereof or filed with the Office or Commission, unless such statement or
omission was made in reliance upon and in conformity with written
information furnished to the Company or the Association with respect to
Trident by or on behalf of Trident expressly for use in the Prospectus or
any amendment or supplement thereof or in any Application, as the case may
be, or (B) the participation by Trident in the Conversion. This indemnity
shall be in addition to any liability the Company and the Association may
have to Trident otherwise.
(b) The Company shall indemnify and hold Trident harmless for any
liability whatsoever arising out of (i) the Allocation Instructions or (ii)
any records of account holders, depositors, borrowers and other members of
the Association delivered to Trident by the Association or its agents for
use during the Conversion.
(c) Trident agrees to indemnify and hold harmless the Company and the
Association, their officers, directors and employees and each person, if
any, who controls the Company and the Association within the meaning of
Section 15 of the Act or Section 20(a) of the Exchange Act, to the same
extent as the foregoing indemnity from the Company and the Association to
Trident, but only with respect to (A) statements or omissions, if any, made
in the Prospectus or any amendment or supplement thereof, in any
Application or to a purchaser of the Shares in reliance upon, and in
conformity with, written information furnished to the Company or the
Association with respect to Trident by or on behalf of Trident expressly
for use in the Prospectus or in any Application; (B) any misrepresentation
by Trident in Section 2(b) of this Agreement; or (C) any liability of the
Company or the Association which is found in a final judgment by a court of
competent jurisdiction (not subject to further appeal) to have principally
and directly resulted from gross negligence or willful misconduct of
Trident.
(d) Promptly after receipt by an indemnified party under this Section
8 of notice of the commencement of any action, such indemnified party will,
if a claim in respect thereof is to be made against the indemnifying party
under this Section 8, notify
Trident Securities, Inc.
Sales Agency Agreement
Page 26
the indemnifying party of the commencement thereof; but the omission so to
notify the indemnifying party will not relieve it from any liability which
it may have to any indemnified party otherwise than under this Section 8.
In case any such action is brought against any indemnified party, and it
notifies the indemnifying party of the commencement thereof, the
indemnifying party will be entitled to participate therein and, to the
extent that it may wish, jointly with the other indemnifying party
similarly notified, to assume the defense thereof, with counsel
satisfactory to such indemnified party, and after notice from the
indemnifying party to such indemnified party of its election so to assume
the defense thereof, the indemnifying party will not be liable to such
indemnified party under this Section 8 for any legal or other expenses
subsequently incurred by such indemnified party in connection with the
defense thereof other than the reasonable cost of investigation except as
otherwise provided herein. In the event the indemnifying party elects to
assume the defense of any such action and retain counsel acceptable to the
indemnified party, the indemnified party may retain additional counsel, but
shall bear the fees and expenses of such counsel unless (i) the
indemnifying party shall have specifically authorized the indemnified party
to retain such counsel or (ii) the parties to such suit include such
indemnifying party and the indemnified party, and such indemnified party
shall have been advised by counsel that one or more material legal defenses
may be available to the indemnified party which may not be available to the
indemnifying party, in which case the indemnifying party shall not be
entitled to assume the defense of such suit notwithstanding the
indemnifying party's obligation to bear the fees and expenses of such
counsel. An indemnifying party against whom indemnity may be sought shall
not be liable to indemnify an indemnified party under this Section 8 if any
settlement of any such action is effected without such indemnifying party's
consent. To the extent required by law, this Section 8 is subject to and
limited by the provisions of Section 23A.
9. Contribution. In order to provide for just and equitable contribution
------------
in circumstances in which the indemnity agreement provided for in Section 8
above is for any reason held to be unavailable to Trident, the Company and/or
the Association other than in accordance with its terms, the Company or the
Association and Trident shall contribute to the aggregate losses, liabilities,
claims, damages, and expenses of the nature contemplated by said indemnity
agreement incurred by the Company or the Association and Trident (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company and the Association on the one hand and Trident on the other from the
offering of the Shares or (ii) if the allocation provided by clause (i) above is
not permitted by applicable law, in such proportion as is appropriate to reflect
not only the relative benefits referred to in clause (i) above, but also the
relative fault of the Company or the Association on the one hand and Trident on
the other hand in connection with the statements or omissions which resulted in
such losses, claims, damages, liabilities or judgments, as well as any other
relevant equitable considerations. The relative benefits received by the
Company and the Association on the one hand and Trident on the other shall be
deemed to be in the same proportions as the total net proceeds from the
Trident Securities, Inc.
Sales Agency Agreement
Page 27
Conversion received by the Company and the Association bear to the total fees
received by Trident under this Agreement. The relative fault of the Company or
the Association on the one hand and Trident on the other shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company or the Association or by Trident
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
The Company and the Association and Trident 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 account
of the equitable considerations referred to in the immediately preceding
paragraph. The amount paid or payable by an indemnified party as a result of
the losses, claims, damages, liabilities or judgments referred to in the
immediately preceding paragraph shall be deemed to include, subject to the
limitations set forth above, any legal or other expenses reasonably incurred by
the indemnified party in connection with investigating or defending any such
action or claim. Notwithstanding the provisions of this Section 9, Trident
shall not be required to contribute any amount in excess of the amount by which
fees owed Trident pursuant to this Agreement exceeds the amount of any damages
which Trident has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who is not guilty of such
fraudulent misrepresentation. To the extent required by law, this Section 8 is
subject to and limited by the provisions of Section 23A.
10. Survival of Agreements, Representations and Indemnities. The
--------------------------------------------------------
respective indemnities of the Company and the Association and Trident and the
representation and warranties of the Company and the Association and of Trident
set forth in or made pursuant to this Agreement shall remain in full force and
effect, regardless of any termination or cancellation of this Agreement or any
investigation made by or on behalf of Trident or the Company or the Association
or any controlling person or indemnified party referred to in Section 8 hereof,
and shall survive any termination or consummation of this Agreement and/or the
issuance of the Shares, and any legal representative of Trident, the Company,
the Association and any such controlling persons shall be entitled to the
benefit of the respective agreements, indemnities, warranties and
representations.
11. Termination. Trident may terminate this Agreement by giving the
-----------
notice indicated below in this Section at any time after this Agreement becomes
effective as follows:
(a) If any domestic or international event or act or occurrence has
materially disrupted the United States securities markets such as to make
it, in Trident's reasonable opinion, impracticable to proceed with the
offering of the Shares; or if trading on the New York Stock Exchange shall
have suspended; or if the United States shall have
Trident Securities, Inc.
Sales Agency Agreement
Page 28
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
material effect on the Association or the Conversion; or if a moratorium in
foreign exchange trading by major international associations or persons has
been declared; or if there shall have been a material change in the
capitalization, condition or business of the Company, or if the Association
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 change in the condition or prospects of
the Company or the Association.
(b) If Trident elects to terminate this Agreement as provided in this
Section, the Company and the Association shall be notified promptly by
Trident by telephone or telegram, confirmed by letter.
(c) If this Agreement is terminated by Trident for any of the reasons
set forth in subsection (a) above, and to fulfill its obligations, if any,
pursuant to Sections 3, 6, 8(a) and 9 of this Agreement and upon demand,
the Company and the Association shall pay Trident the full amount so owing
thereunder.
(d) The Association may terminate the Conversion in accordance with
the terms of the Plan. Such termination shall be without liability to any
party, except that the Company and the Association shall be required to
fulfill their obligations pursuant to Sections 3(b), 3(c), 6, 8(a) and 9 of
this Agreement.
12. Notices. All communications hereunder, except as herein otherwise
-------
specifically provided, shall be in writing and if sent to Trident shall be
mailed, delivered or telegraphed and confirmed to Trident Securities, Inc., 0000
Xxx Xxxxx Xxxx, Xxxxx 000, Xxxxxxx, Xxxxx Xxxxxxxx 00000, Attention: Mr. R. Xxx
Xxxxxxx, Xx. (with a copy to Xxxxxxx, Spidi, Sloane & Xxxxx, P.C., 0000 X
Xxxxxx, X.X., Xxxxx 000 Xxxx, Xxxxxxxxxx, X.X. 00000, Attention: Xxxxxxx X.
Xxxxxx, Esquire) and if sent to the Company or the Association shall be mailed,
delivered or telegraphed and confirmed to Rocky Ford Federal Savings and Loan
Association, 000 Xxxxx Xxxxxx, Xxxxx Xxxx, Xxxxxxxx 00000, Attention: Xxxxx X.
Xxxxxxxx, President (with a copy to Housley Kantarian & Xxxxxxxxx, P.C., Suite
700, 0000 - 00xx Xxxxxx, X.X., Xxxxxxxxxx, X.X. 00000, Attention: Xxxxxx X.
Xxxxxx, Esquire).
13. Parties. This Agreement shall inure solely to the benefit of, and
-------
shall be binding upon, Trident, the Company, the Association and the controlling
and other persons referred to in Section 8 hereof, and their respective
successors, legal representatives and assigns, and no other person shall have or
be construed to have any legal or equitable right, remedy or claim under or in
respect of or by virtue of this Agreement or any provision herein contained.
Trident Securities, Inc.
Sales Agency Agreement
Page 29
14. Construction. Unless governed by preemptive federal law, this
------------
Agreement shall be governed by and construed in accordance with the substantive
laws of North Carolina.
15. Counterparts. This Agreement may be executed in separate
------------
counterparts, each of which when so executed and delivered shall be an original,
but all of which together shall constitute but one and the same instrument.
Please acknowledge your agreement to the foregoing by signing below and
returning to the Company one copy of this letter.
ROCKY FORD FINANCIAL, ROCKY FORD FEDERAL SAVINGS AND LOAN
INC. ASSOCIATION
By: _______________________ By: ____________________________
Xxxxx X. Xxxxxxxx Xxxxx X. Xxxxxxxx
President and Chief President and Chief
Executive Officer Executive Officer
Date: _____________________ Date: ____________________________
Agreed to and accepted:
TRIDENT SECURITIES, INC.
By: ________________________
Date:
Exhibit A
Jurisdictions where Trident is a Registered Selling Agent
Trident Securities, Inc. is a registered selling agent in the jurisdictions
--
listed below:
Alabama Missouri
Arizona Nebraska
Arkansas Nevada
California New Hampshire
Colorado New Jersey
Connecticut New Mexico
Delaware New York
District of Columbia North Carolina
Florida North Dakota (Trident Securities, Inc. only, no
agents)
Georgia Ohio
Idaho Oklahoma
Illinois Oregon
Indiana Pennsylvania
Iowa Rhode Island
Kansas South Carolina
Kentucky Tennessee
Louisiana Texas
Maine Vermont
Maryland Virginia
Massachusetts Washington
Michigan West Virginia
Minnesota Wisconsin
Mississippi Wyoming
Trident Securities, Inc. is not a registered selling agent in the jurisdictions
---
listed below:
Alaska
Hawaii
Montana
South Dakota
Utah