CONFIDENTIAL
November 30, 2000
Mr.Vince A. Elhilow
President & Chief Executive Officer
Fidelity Bankshares, Inc.
218 Datura Street
West Palm Beach, FL 33401
Mr.Vince A. Elhilow
President & Chief Executive Officer
Fidelity Bankshares, MHC
218 Datura Street
West Palm Beach, FL 33401
Re: "Second Step" Conversion - Selling Agent Services, Proxy
Solicitation & Administrative Services
Dear Mr. Elhilow:
Ryan, Beck & Co. ("Ryan, Beck") is pleased to submit this engagement letter
setting forth the terms of the proposed engagement between Ryan, Beck and
Fidelity Bankshares, Inc. (the "Company") and Fidelity Bankshares, MHC (the
"MHC") in connection with the proposed conversion and sale of the Common Stock
of the Company held by Fidelity Bankshares, MHC.
1. BACKGROUND ON RYAN, BECK
Ryan, Beck, Inc., was organized in 1946 and is one of the nation's leading
investment bankers for financial institutions. The firm is a registered
broker-dealer with the Securities and Exchange Commission, a member of the
National Association of Securities Dealers, Inc., Securities Industry
Association and a member of the Securities Investor Protection Corporation.
Ryan, Beck's Financial Institutions Group, including corporate finance and
research, represents one of the largest such groups devoted solely to financial
institutions matters in the country. Moreover, Ryan, Beck is one of the largest
market makers in bank and thrift stocks.
2. SECOND STEP STOCK OFFERING
It is our understanding that the Company proposes to issue shares of common
stock of the Company held by the MHC in a subscription offering with any
remaining shares sold in a community offering and/or underwritten public
offering (collectively the "Offering"). Shares sold in the Offering shall
represent those shares representing the final independent appraisal times the
adjusted majority
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Mr. Vince A. Elhilow
November 30, 2000
Page 2
ownership of the MHC. In connection therewith, the Company's Board of Directors
will adopt a reorganization and stock issuance plan (the "Plan") whereby shares
of Common Stock will be offered for sale in the Offering. Ryan, Beck proposes to
act as financial advisor to the Company with respect to the Plan and selling
agent/lead manager with respect to the subscription, community offering, and any
public underwriting. Specific terms of services shall be set forth in a
definitive agency agreement and/or underwriting agreement (the "Definitive
Agreement") between Ryan, Beck and the Company to be executed on the date the
offering document is declared effective by the appropriate regulatory
authorities. The Definitive Agreement will include customary representations and
warranties, covenants, conditions, termination provisions and indemnification,
contribution and limitation of liability provisions, all to be mutually agreed
upon by Ryan, Beck and the Company (and its successors). Ryan, Beck's
willingness to execute a Definitive Agreement and conduct the Offering will be
subject to its satisfaction, in its sole discretion and judgment, with a number
of other factors, including but not limited to the following:
i. there being no material adverse change in the condition or operation
of the Company;
ii. satisfactory disclosure of all relevant financial information in the
disclosure documents and determination that the sale of the securities
is reasonable given such disclosures;
iii. the current financial position, earnings performance and future
prospects of the Company;
iv. receipt of a "comfort letter" from the Company's accountants
containing no material exceptions; and
v. the condition of the credit and equity markets and particularly as
they relate to securities of financial institutions.
3. SERVICES TO BE PROVIDED BY RYAN, BECK
a. Advisory Services - Thorough planning is essential to a successful
offering. Ryan, Beck serves as lead coordinator of the marketing and
logistic efforts necessary to prepare for an offering. Our actions are
intended to clearly define responsibilities and timetables, while avoiding
costly surprises. We assume responsibility for the initial preparation of
marketing materials--saving you time and legal expense. Moreover, as your
investment banker, Ryan, Beck will evaluate the financial, marketing and
regulatory issues involved in the Offering. Our specific responsibilities
include:
- Review and advice with respect to the Plan;
- Review and provide input with respect to the Business Plan to be
prepared in connection with the Reorganization;
- Participate in drafting the Prospectus and assist in obtaining all
requisite regulatory approvals on terms most favorable to the Company;
- Review and opine to the Board of Directors on the adequacy of the
appraisal process;
- Develop a marketing plan for the Offering including direct mail,
advertising, community meetings and telephone solicitation;
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Mr. Vince A. Elhilow
November 30, 2000
Page 3
- Provide specifications and assistance in selecting data processing
assistance, printer and other professionals;
- Develop an operating plan for the Stock Sale Center (the "Center"); -
Provide a list of equipment and supplies needed for the Center;
- Draft marketing materials including letters, brochures, slide show
script and advertisements; and
- Assist in arranging market-makers for post-reorganization trading.
b. Administrative Services and Stock Sale Center Management - Ryan, Beck will
manage all aspects of the Offering. A successful Offering requires an
enormous amount of attention to detail. Working knowledge and familiarity
with the law and "lore" of bank regulators, Securities and Exchange
Commission and National Association of Securities Dealers is essential.
Ryan, Beck's experience in managing many thrift reorganizations and second
step conversion offerings will minimize the burden on your management and
disruption to normal banking business. At the same time, our legal,
accounting and regulatory background ensures that details are attended to
in a professional fashion. An Offering requires accurate and timely record
keeping and reporting. Furthermore, customer inquiries must be handled
professionally and accurately. The Center centralizes all data and work
effort relating to the Offering.
- Provide experienced on-site registered representatives to minimize
disruption of day-to-day business;
- Identify and organize space for the Center, the focal point of sales
and proxy solicitation activity;
- Administer the Center. All substantive stock and proxy related matters
will be handled by employees of Ryan, Beck;
- Organize and implement all proxy solicitation efforts;
- Prepare procedures for processing proxies, stock orders and cash, and
for handling requests for information;
- Ryan, Beck will outsource all reorganization agent/data
processing/transfer agent functions. Ryan, Beck recommends outsourcing
such services to Chase/Mellon Shareholder Services or Crowe Chizek and
Company LLP. The cost of such services will be borne by the Company
and are subject to separate agreement;
- Provide scripts, training and guidance for the telephone team in
soliciting proxies and in the stock sales telemarketing effort;
- Educate the Company's directors, officers and employees about the
Reorganization and Offering, their roles and relevant securities laws;
- Train branch managers and customer-contact employees on the proper
response to stock purchase inquiries;
- Train and supervise Center staff assisting with proxy and order
processing;
- Prepare daily sales reports for management and ensure funds received
balance to such reports;
- Coordinate functions with the data processing agent, printer, transfer
agent, stock certificate printer and other professionals;
- Design and implement procedures for handling IRA and Keogh orders; and
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Mr. Vince A. Elhilow
November 30, 2000
Page 4
- Provide post-offering subscriber assistance and management of the
pro-ration process.
c. Securities Marketing Services - Ryan, Beck uses various sales techniques
including direct mail, advertising, community investor meetings, telephone
solicitation, and if necessary, selling group formation. The sales approach
is tailored to fit your specific situation. Our techniques are designed to
attract a stockholder base comprised largely of community oriented
individuals loyal to the Company.
Our specific actions include:
- Assign licensed registered representatives from our staff to work at
the Center to solicit orders on behalf of the Company from eligible
prospects who have been targeted as likely and desirable stockholders;
- Assist management in developing a list of potential investors who are
viewed as priority prospects;
- Respond to inquiries concerning the Offering and investment
opportunities;
- Organize, coordinate and participate in community informational
meetings. These meetings are intended to both relieve customer anxiety
and attract potential investors. The meetings generate widespread
publicity for the Offering while providing local exposure of the
Company and promoting favorable stockholder relations;
- Supervise and conduct a telemarketing campaign to identify prospects
from among the Company's customer base;
- Continually advise management on market conditions and the community's
responsiveness to the Offering;
- If appropriate and at the request of the Company, arrange a syndicated
community Offering involving a selling group of selected
broker-dealers acting on a "best efforts" basis to assist in selling
stock during the Offering. In so doing, prepare broker "fact sheets"
and arrange "road shows" for the purpose of stimulating interest in
the stock and informing the brokerage community of the particulars of
the Offering. Alternatively, if so directed by the Company, Ryan, Beck
will lead manage a "stand-by" firm commitment underwriting including
other underwriters agreed to by the Company and Ryan, Beck. In the
event the Company elects to pursue a firm commitment underwriting,
such arrangement shall be subject to separate terms and agreement;
- Coordinate efforts to maximize after-market support and Company
sponsorship.
4. COMPENSATION
a. For its services hereunder, the Company will pay to Ryan, Beck the
following compensation in connection with the Reorganization and Offering.
(1) An advisory and management fee of $100,000 in connection with the
advisory, administrative and proxy solicitation services set forth in
section 3.a. and 3.b. hereof (the "Management Fee"); the Management
Fee shall be payable as follows: $25,000 upon signing this Agreement;
$25,000 upon the initial filing of the Registration Statement; and
$50,000 upon closing of the Offering.
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Mr. Vince A. Elhilow
November 30, 2000
Page 5
(2) A fee of one percent (1.00%) of the dollar amount of the Common Stock
sold in the Offering other than those shares sold pursuant to (3)
below. No fee shall be payable pursuant to this subsection in
connection with the sale of stock to officers, directors, employees or
immediate family of such persons ("Insiders") and qualified and
non-qualified employee benefit plans of the Company or the Insiders.
(3) For stock sold by a group of NASD member firms (which will include
Ryan, Beck & Co.) pursuant to a syndicated community offering solely
managed by Ryan, Beck (the "Selling Group"), a fee equal to one
percent (1.00%) which fee along with the fee payable directly by the
Company to selected dealers shall not exceed seven percent (7.00%) in
the aggregate. Ryan, Beck will not commence sales of the stock through
members of the Selling Group without the specific prior approval of
the Company. To the extent the Company elects to employ Ryan, Beck as
well as other broker-dealers to serve as "stand-by" underwriters then
any "stand-by" fees associated therewith are to be paid separately by
the Company. The total underwriting discount shall not exceed seven
percent (7.00%) in the aggregate.
Such fees (less the amount of any advance payments) are to be paid to
Ryan, Beck at the closing of the Offering. If, pursuant to a
resolicitation undertaken by the Company, Ryan, Beck is required to
provide significant additional services, or expend significant
additional time, the parties shall mutually agree to the dollar amount
of the additional compensation due.
b. If (i) the Plan is abandoned or terminated by the Company; (ii) the
Offering is not consummated by December 31, 2001; (iii) Ryan, Beck
terminates this relationship because there has been a material adverse
change in the financial condition or operations of the Company since
September 30, 2000; or (iv) immediately prior to commencement of the
Offering, Ryan, Beck terminates this relationship because in its opinion,
which shall have been formed in good faith after reasonable determination
and consideration of all relevant factors, there has been a failure to
satisfactorily disclose all relevant information in the disclosure
documents or the existence of market conditions which might render the sale
of the shares by the Company hereby contemplated inadvisable; Ryan, Beck
shall not be entitled to the fees set forth above under subparagraph (a),
but in addition to reimbursement of its reasonable out-of-pocket expenses
as set forth in paragraph 7 below, shall be entitled to retain the
Management Fee already paid.
5. DOCUMENTS
The Company and its counsel will complete, file with the appropriate regulatory
authorities and, as appropriate, amend from time to time, the information to be
contained in the Company's applications to banking and securities regulators and
any related exhibits thereto. In this regard, the Company and its counsel will
prepare a prospectus and any other necessary disclosure documents relating to
the offering of the Common Stock in conformance with applicable rules and
regulations. As the Company's financial advisor, Ryan, Beck will in conjunction
with counsel, conduct an examination of the relevant documents and records of
the Company and will make such other reasonable investigation as deemed
necessary and appropriate under the circumstances. The Company agrees to make
all such documents, records and other information deemed necessary by Ryan,
Beck, or its counsel, available to them upon reasonable request. Ryan, Beck's
counsel will prepare, subject to the approval of the Company's counsel, the
Definitive Agreement. Ryan, Beck's counsel shall be selected by Ryan, Beck,
subject to the approval of the Company.
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Mr. Vince A. Elhilow
November 30, 2000
Page 6
6. EXPENSES AND REIMBURSEMENT
The Company will bear all of its expenses in connection with the Reorganization
and the Offering of its Common Stock including, but not limited to, the
Company's attorney fees, NASD filing fees, "blue sky" legal fees, expenses for
appraisal, auditing and accounting services, advertising expenses, printing
expenses, "road show" expenses, syndicate related expenses, temporary personnel
expenses and the preparation of stock certificates. In the event Ryan, Beck
incurs such expenses on behalf of the Company, the Company shall pay or
reimburse Ryan, Beck for such reasonable fees and expenses regardless of whether
the Reorganization is successfully completed. Ryan, Beck will not incur any
single expense of more than $2,000, pursuant to this paragraph without the prior
approval of the Company.
The Company also agrees to reimburse Ryan, Beck for reasonable out-of-pocket
expenses, including legal fees and expenses, incurred by Ryan, Beck in
connection with the services contemplated hereunder. Ryan, Beck will not incur
legal fees (including up to $10,000 or out-of-pocket expenses of counsel) in
excess of $60,000 without the approval of the Company. Other out-of-pocket
expenses directly incurred by Ryan, Beck will not exceed $65,000 without the
approval of the Company. The parties acknowledge, however, that such caps may be
increased by the mutual consent of the Company and Ryan, Beck in the event of
any material delay in the Offering which would require an update of the
financial information in tabular form contained in the Prospectus for a period
later than December 31, 2000. Not later than two days before closing, we will
provide you with a detailed accounting of all reimbursable expenses to be paid
at closing.
7. MARKET MAKING & RESEARCH
Ryan, Beck agrees to use its best efforts to maintain a market and if necessary
solicit other broker dealers to make a market in the Common Stock after the
"Second Step Conversion".
8. INFORMATION TO BE SUPPLIED; DOCUMENTS AND CONFIDENTIALITY
a. The Company and its counsel will complete, file with the appropriate
regulatory authorities and, as appropriate, amend from time to time, the
information to be contained in the Company applications to banking and
securities regulators and any related exhibits thereto. In this regard, the
Company and its counsel will prepare a prospectus and any other necessary
disclosure documents relating to the offering of the Common Stock in
conformance with applicable rules and regulations. As the Company's
financial advisor, Ryan, Beck will in conjunction with counsel, conduct an
examination of the relevant documents and records of the Company and will
make such other reasonable investigation as deemed necessary and
appropriate under the circumstances.
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Mr. Vince A. Elhilow
November 30, 2000
Page 7
b. The Company acknowledges that all advice (written or oral) given by Ryan,
Beck to the Company is intended solely for the benefit and use of the
Company. Other than to the extent required to be reflected in Board and
committee meeting minutes, no advice (written or oral) of Ryan, Beck
hereunder shall be used, reproduced, disseminated, quoted or referred to at
any time, in any manner, or for any purpose, nor shall any public
references to Ryan, Beck be made by the Company (or such persons), without
the prior written consent of Ryan, Beck.
c. Ryan, Beck will maintain the confidentiality of the Information and, unless
and until such information shall have been made publicly available by the
Company or by others without breach of a confidentiality agreement, shall
disclose the Information only as authorized by the Company or as required
by law or by order of a governmental authority or court of competent
jurisdiction. In the event that Ryan, Beck is legally required to make
disclosure of any of the Information, Ryan, Beck will give notice to the
Company prior to such disclosure, to the extent that Ryan, Beck can
practically do so. The foregoing paragraph shall not apply to information
that:
i. at the time of disclosure by the Company is, or thereafter
becomes, generally available to the public or within the
industries in which the Company or Ryan, Beck or its affiliates
conduct business, other than as a result of a breach by Ryan,
Beck of its obligations under this Agreement;
ii. prior to or at the time of disclosure by the Company, was already
in the possession of, or conceived by, Ryan, Beck or any of its
affiliates, or could have been developed by them from information
then in their possession, by the application of other information
or techniques in their possession, generally available to the
public, or available to Ryan, Beck or its affiliates other than
from the Company;
iii. at the time of disclosure by the Company or thereafter, is
obtained by Ryan, Beck or any of its affiliates from a third
party who Ryan, Beck reasonably believes to be in possession of
the information not in violation of any contractual, legal or
fiduciary obligation to the Company with respect to that
information; or
iv. is independently developed by Ryan, Beck or its affiliates.
d. In connection with Ryan, Beck's activities on behalf of the Company, the
Company will furnish Ryan, Beck with all financial and other information
regarding the Company that Ryan, Beck reasonably believes appropriate to
its assignment (all such information so furnished by the Company, whether
furnished before or after the date of this Agreement, being referred to
herein as the "Information"). The Company will provide Ryan, Beck with
access to the officers, directors, employees, independent accountants,
legal counsel and other advisors and consultants for the Company. The
Company recognizes and agrees that Ryan, Beck:
i. will use and rely primarily on the Information and information
available from generally recognized public sources in performing
the services contemplated by this Agreement without independently
verifying the Information or such other information;
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Mr. Vince A. Elhilow
November 30, 2000
Page 8
ii. does not assume responsibility for the accuracy of the
Information or such other information; and
iii. will not make an appraisal of any assets or liabilities owned or
controlled by the Company or its market competitors.
e. Nothing in this Agreement shall be construed to limit the ability of Ryan,
Beck or its affiliates to pursue, investigate, analyze, invest in, or
engage in investment banking, financial advisory or any other business
relationships with, entities other than the Company, notwithstanding that
such entities may be engaged in a business which is similar to or
competitive with the business of the Company, and notwithstanding that such
entities may have actual or potential operations, products, services,
plans, ideas, customers or supplies similar or identical to the Company, or
may have been identified by the Company as potential merger or acquisition
targets or potential candidates for some other business combination,
cooperation or relationship. The Company expressly acknowledges and agrees
that it does not claim any proprietary interest in the identity of any
other entity in its industry or otherwise, and that the identity of any
such entity is not confidential information.
9. BLUE SKY
To the extent required by applicable state law, Ryan, Beck and the Company will
need to obtain or confirm exemptions, qualifications or registration of the
Common Stock under applicable state securities laws and NASD policies. Such work
will be performed by the Company's counsel and the cost of such legal work and
related filing fees will be paid by the Company. The Company will cause the
counsel performing such services to prepare a Blue Sky memorandum related to the
Offering including Ryan, Beck's participation therein and shall furnish Ryan,
Beck a copy thereof addressed to Ryan, Beck or upon which such counsel shall
state Ryan, Beck may rely.
10. AVAILABILITY OF "STARS" PROGRAM
As an additional service to the Company, Ryan, Beck will make available for a
period of 1 year following the completion of the Offering, advisory services
through the Ryan, Beck Strategic Advisory Services ("STARS") program. The
undersigned will serve as the senior relationship manager for this program. If
the Company elects to avail itself of the STARS program, Ryan, Beck will meet
with the Company at its request. Ryan, Beck also will provide opinions and
recommendations, upon request, for the areas covered below:
Valuation Analysis
Merger and Acquisition Planning and Analysis
Merger and Acquisition Trends
Planning, Forecasting & Competitive Strategy
Capital, Asset & Liability Structure & Management
Stock Repurchase Programs
Dividend Policy
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Mr. Vince A. Elhilow
November 30, 2000
Page 9
Dividend Reinvestment Programs
Market Development and Sponsorship of Bank Securities
Financial Disclosure
Financial Relations
Financial Reports
Branch Sales and Purchases
Stock Benefit Plan Analysis and Advisory
Stockholder & Investor Relations Presentations & Programs
Fairness Opinions
Scanning of Potential Acquisition Candidates
Based on Published Statement Information
(This screening does not extend to any in-depth merger and
acquisition analyses or studies which are available under Ryan,
Beck's normal fee schedule, and does not include retention of Ryan,
Beck by the Company for any specific merger/acquisition situation.)
If the Company elects to utilize the STARS program Ryan, Beck will waive the
regular retainer fee and hourly charges for this program for the first year. The
Company also will reimburse Ryan, Beck's reasonable out-of-pocket expenses
incurred in conjunction with the performance of these services. Such
out-of-pocket expenses shall include travel, legal and other miscellaneous
expenses. Ryan, Beck will not incur any single expense in excess of $2,000
pursuant to this paragraph without the prior approval of the Company.
If negotiations for a transaction conducted during the term of the STARS
Advisory Agreement described above result in the execution of a definitive
agreement and/or consummation of a transaction for which Ryan, Beck customarily
would be entitled to a fee for its advisory or other investment banking
services, Ryan, Beck shall receive a contingent advisory fee ("Advisory Fee") in
accordance with the terms of a separate engagement letter with respect to such
transaction.
11. INDEMNIFICATION
The Definitive Agreement will provide for indemnification of the type usually
found in underwriting agreements as to certain liabilities, including
liabilities under the Securities Act of 1933. The Company also agrees to defend,
indemnify and hold harmless Ryan, Beck and its officers, directors, employees
and agents against all claims, losses, actions, judgments, damages or expenses,
including but not limited to reasonable attorneys' fees, arising solely out of
the engagement described herein, except that such indemnification shall not
apply to Ryan, Beck's own bad faith, willful misconduct or gross negligence.
12. CONFIDENTIALITY
To the extent consistent with legal requirements and except as otherwise set
forth in the Prospectus, all information given to Ryan, Beck by the Company,
unless publicly available or otherwise available to Ryan, Beck without
restriction to breach of any confidentiality agreement ("Confidential
Information"), will be held by Ryan, Beck in confidence and will not be
disclosed to anyone other than Ryan, Beck's agents without the Company's prior
approval or used for any purpose other than those
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Mr. Vince A. Elhilow
November 30, 2000
Page 10
referred to in this engagement letter. Upon any termination of its engagement,
Ryan, Beck shall promptly deliver to the Company all materials specifically
produced for it and will return to the Company all Confidential Information
provided to Ryan, Beck during the course of its engagement hereunder.
13. NASD MATTERS
Ryan, Beck has an obligation to file certain documents and to make certain
representations to the National Association of Security Dealers ("NASD") in
connection with the Reorganization. The Company agrees to cooperate with Ryan,
Beck and provide such information as may be necessary for Ryan, Beck to comply
with all NASD requirements applicable to it in connection with its participation
as contemplated herein in the Reorganization. Ryan, Beck is and will remain
through completion of the Reorganization a member in a good standing of the NASD
and will comply with all applicable NASD requirements.
14. OBLIGATIONS
(a) Except as set forth below, this engagement letter is merely a statement of
intent. While Ryan, Beck and the Company agree in principle to the contents
hereof and propose to proceed promptly and in good faith to work out the
arrangements with respect to the Reorganization, any legal obligations
between Ryan, Beck and the Company shall be only: (i) those set forth
herein in paragraphs 2, 3 and 4 regarding services and payments; (ii) those
set forth in paragraph 6 regarding reimbursement for certain expenses;
(iii) those set forth in paragraph 11 regarding indemnification; (iv) those
set forth in paragraph 12 regarding confidentiality; and (v) as set forth
in a duly negotiated and executed Definitive Agreement.
(b) The obligation of Ryan, Beck to enter into the Definitive Agreement shall
be subject to there being, in Ryan, Beck's opinion, which shall have been
formed in good faith after reasonable determination and consideration of
all relevant factors: (i) no material adverse change in the condition or
operation of the Company; (ii) satisfactory disclosure of all relevant
information in the disclosure documents and a determination that the sale
of stock is reasonable given such disclosures; (iii) no market conditions
which might render the sale of the shares by the Company hereby
contemplated inadvisable; and (iv) agreement that the price established by
the independent appraiser is reasonable in the then prevailing market
conditions.
15. INDEPENDENT CONTRACTOR; NO FIDUCIARY DUTY
The Company acknowledges and agrees that it is a sophisticated business
enterprise and that Ryan, Beck has been retained pursuant to this Agreement to
act as financial advisor to the Company solely with respect to the matters set
forth herein. In such capacity, Ryan, Beck shall act as an independent
contractor, and any duties of Ryan, Beck arising out of its engagement pursuant
to this Agreement shall be contractual in nature and shall be owed solely to the
Company. Each party disclaims any intention to impose any fiduciary duty on the
other.
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Mr. Vince A. Elhilow
November 30, 2000
Page 11
16. GOVERNING LAW
This Agreement shall be governed by and construed in accordance with
the laws of the State of Florida applicable to contracts executed and to be
wholly performed therein without giving effects to its conflicts of laws
principles or rules. Any dispute hereunder shall be brought in a court in the
State of Florida.
17. WAIVER OF TRIAL BY JURY
EACH OF RYAN, BECK AND THE COMPANY WAIVES ALL RIGHT TO TRIAL BY JURY IN
ANY ACTION, PROCEEDING, CLAIM OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT
OR OTHERWISE) RELATED TO OR ARISING OUT OF THIS AGREEMENT.
Please acknowledge your agreement to the foregoing by signing in the place
provided below and returning one copy of this letter to our office together with
the retainer payment in the amount of $25,000. We look forward to working with
you.
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Mr. Vince A. Elhilow
November 30, 2000
Page 12
RYAN, BECK & CO., INC.
BY: /s/ Ben A. Plotkin
------------------------------------------------------
Ben A. Plotkin
Chairman & Chief Executive Officer
Accepted and Agreed to This 30 Day of November, 2000
FIDELITY BANKSHARES, INC.
BY: /s/ Vince A. Elhilow
------------------------------------------------------
Vince A. Elhilow
President & Chief Executive Officer
FIDELITY BANKSHARES, MHC
BY: /s/ Vince A. Elhilow
------------------------------------------------------
Vince A. Elhilow
President & Chief Executive Officer
