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As filed with the Securities and Exchange Commission on November 15, 1999
Registration No. 33-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
SECURITY FINANCIAL CORP.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
Delaware 341579662
(State or Other Jurisdiction (IRS Employer
of Incorporation or Organization) Identification No.)
ONE SOUTH MAIN STREET
NILES, OHIO 44446
(330) 544-7400
(Address, Including Zip Code, and Telephone Number, Including Area Code, of
Registrant's Principal Executive Offices)
MR. GLENN E. GRIFFITHS COPIES OF COMMUNICATION TO:
PRESIDENT AND CHIEF EXECUTIVE OFFICER EDWIN L. HERBERT, ESQ.
SECURITY FINANCIAL CORP. WERNER & BLANK CO., L.P.A.
ONE SOUTH MAIN STREET 7205 W. CENTRAL AVENUE
NILES, OH 44446 TOLEDO, OH 43617
(330) 544-7400 (419) 841-8051
(Name, Address, Including Zip Code, and Telephone Number, Including Area Code,
of Agent for Service)
Approximate date of commencement of proposed sale of the securities
to the public:
AS SOON AS PRACTICABLE AFTER THIS REGISTRATION STATEMENT BECOMES EFFECTIVE.
If the only securities being registered on this Form are being offered pursuant
to dividend or interest reinvestment plans, please check the following box [X].
If any of the securities being registered on this Form are being offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933 , other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. [ ].
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CALCULATION OF REGISTRATION FEE
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Title of Each Proposed Maximum Proposed Maximum
Class of Securities Amount to Offering Price Aggregate Offering Amount of
to be Registered be Registered Per Share(1) Price(1) Registration Fee
- - ---------------- ------------- ------------ -------- ----------------
<S> <C> <C> <C> <C>
Common Stock,
no par value 50,000 $ 71.36 $3,568,000.00 $ 992.000
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</TABLE>
(1) Estimated solely for the purpose of determining the registration fee. The
figure was calculated pursuant to Rule 457(c) using the average of the bid
and asked price on November 8, 1999 (such date being within five business
days prior to the date of filing the Registration Statement.)
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Prospectus
Security Financial Corp.
Dividend Reinvestment and
Stock Purchase Plan
50,000 Shares of Common Stock, No Par Value
Security Financial Corp. (the "Company" or "we") is offering to its
shareholders the opportunity to purchase shares of the Company's Common Stock,
no par value (the "Common Stock"), by reinvesting dividends or by making
optional cash investments under the Security Financial Corp. Dividend
Reinvestment and Stock Purchase Plan (the "Plan"). This prospectus describes the
Plan and provides complete details on it as it is currently in effect. Eligible
shareholders under the Plan may reinvest all or a portion of their cash
dividends in shares of Common Stock as well as make optional cash investments of
$100 or more per investment in Common Stock up to a total of $1,000 per calendar
quarter. In addition, dividends on all shares acquired and held in the accounts
of participants under the Plan will be automatically reinvested in additional
shares of Common Stock.
The Company's principal executive offices are located at One South
Main Street, Niles, Ohio 44446, telephone: (330) 544-7400. The Company's Common
Stock is traded over the counter.
The Administrator of the Plan will purchase shares of Common Stock for
participants from the Company at a price equal to the midpoint (computed to six
decimal places) between the highest asked and lowest asked price per share of
Common Stock over the ten trading days immediately preceding the dividend
payment date under the Plan on which purchases at that price are being made. No
brokerage commissions, fees or service charges will be incurred by participants
in connection with purchases of shares under the Plan or for participating in
the Plan. The Administrator will charge participants the brokerage commissions
for the sale of shares of Common Stock at the election of the participant upon
termination of participation in the Plan.
We suggest you keep this Prospectus for future reference.
Investing in the Company's securities involves risk. See "Risk
Factors" beginning on page 4.
None of the securities offered by this Prospectus are deposits or
accounts. They are not insured by the Federal Deposit Insurance Corporation or
any other governmental agency.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if this
Prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
The date of this Prospectus is November 15, 1999.
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- We have not authorized anyone to give you any information that
differs from the information in this Prospectus. If you receive
different information, you should not rely on it.
- This Prospectus does not constitute an offer to sell, or the
solicitation of an offer to buy, the securities to which it
relates in any circumstances in which such offer or solicitation
is unlawful.
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TABLE OF CONTENTS
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Page
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<S> <C>
RISK FACTORS.................................................................................................4
WHERE YOU CAN FIND MORE INFORMATION..........................................................................7
THE COMPANY..................................................................................................7
USE OF PROCEEDS..............................................................................................8
THE PLAN.....................................................................................................8
Purpose.............................................................................................8
Administration......................................................................................9
Eligibility.........................................................................................9
Participation by Shareholders......................................................................10
Purchases..........................................................................................11
Dividends..........................................................................................11
Costs..............................................................................................11
Optional Cash Payments.............................................................................12
Reports to Participants............................................................................13
Certificates for Shares............................................................................13
Withdrawal of Shares...............................................................................14
Termination of Participation in the Plan...........................................................15
General Information................................................................................16
LEGAL OPINION...............................................................................................19
EXPERTS ....................................................................................................20
INDEMNIFICATION.............................................................................................20
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RISK FACTORS
In addition to the other information in this Prospectus and the
information we incorporate by reference, you should consider carefully the
following factors in evaluating the Company and our business before purchasing
our Common Stock.
BECAUSE OUR COMMON STOCK TRADES OVER THE COUNTER, OUR SHARES MAY BE SUBJECT TO
EXTREME PRICE FLUCTUATIONS AND YOU MAY HAVE DIFFICULTY TRADING YOUR SHARES.
Persons who purchase our Common Stock may be unable to readily sell the
Common Stock. Our Common Stock trades only over the counter and has been trading
with limited volume. We are not currently listed on the Nasdaq National Market
or any national stock exchange. Furthermore, because our Common Stock is not
listed on the Nasdaq National Market, trading in our Common Stock is also
limited by SEC rules. There can be no assurance that we will list our securities
on a national securities exchange at any time in the future.
BECAUSE WE FACE INTENSE AND SIGNIFICANT COMPETITION FROM MANY LARGE MULTI-BANK
HOLDING COMPANIES, OUR ABILITY TO ATTRACT DEPOSITS, MAKE LOANS OR DEVELOP OTHER
LINES OF BUSINESS MAY BE ADVERSELY AFFECTED.
In addition to the challenge of attracting and retaining customers for
traditional banking services, our competitors now include securities dealers,
brokers, mortgage bankers, investment advisers and finance and insurance
companies who seek to offer one-stop financial services to their customers that
may include services that banks have not been able or allowed to offer to their
customers in the past. The increasingly competitive environment is a result
primarily of changes in regulation, changes in technology and product delivery
systems and the accelerating pace of consolidation among financial services
providers. If we fail to adequately address each of the competitive pressures in
the banking industry, our financial condition and results of operations could be
adversely affected.
BECAUSE WE ARE ENGAGED IN A HEAVILY REGULATED INDUSTRY, ANY CHANGES IN
GOVERNMENTAL LAWS AND REGULATION AND POLICY COULD LIMIT OUR FUTURE GROWTH.
Any changes to federal banking laws and regulations may negatively
impact our ability to expand services and to increase the value of our business.
We are subject to extensive state and federal regulation, supervision, and
legislation that govern almost all aspects of our operations. These laws may
change from time to time and are primarily intended for the protection of
consumers, depositors and the deposit insurance funds. In addition, the
Company's earnings are affected by the monetary policies of the Federal Reserve
Board. These policies, which include regulating the national supply of bank
reserves and bank credit, can have a major effect upon the source and cost of
funds and the rates of return earned on loans and investments. The Federal
Reserve influences the size and distribution of bank reserves through its open
market operations and changes in
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cash reserve requirements against member bank deposits. We cannot predict what
effect any presently contemplated or future changes in the laws or regulations
or their interpretations would have on us, but such changes could be materially
adverse to our financial performance.
BECAUSE OUR PROFITABILITY IS DIRECTLY RELATED TO INTEREST RATES, ANY CHANGES IN
THESE RATES MAY ADVERSELY AFFECT OUR EARNINGS AND FINANCIAL CONDITION.
Changes in interest rates affect our operating performance and
financial condition in diverse ways. Our profitability depends in substantial
part on our "net interest spread," which is the difference between the rates we
receive on loans and investments and the rates we pay for deposits and other
sources of funds. Our net interest spread will depend on many factors that are
partly or entirely outside our control, including competition, federal economic,
monetary and fiscal policies, and economic conditions generally. Historically,
net interest spreads for other financial institutions have widened and narrowed
in response to these and other factors, which are often collectively referred to
as "interest rate risk."
BECAUSE WE DEPEND ON OUR ABILITY TO ATTRACT AND RETAIN KEY PERSONNEL, ANY LOSS
OF, OR OUR INABILITY TO ATTRACT, THESE PERSONNEL COULD ADVERSELY AFFECT US.
Our success depends upon the continued service of our senior management
team and upon our ability to attract and retain qualified financial services
personnel. Competition for qualified employees is intense. In our experience, it
can take a significant period of time to identify and hire personnel with the
combination of skills and attributes required in carrying out our strategy. If
we lose the services of our key personnel, or are unable to attract additional
qualified personnel, our business, financial condition, results of operations
and cash flows could be materially adversely affected.
BECAUSE OUR ABILITY TO PAY DIVIDENDS IS SUBJECT TO REGULATORY LIMITATIONS, THERE
IS NO ASSURANCE THAT WE WILL CONTINUE TO PAY DIVIDENDS.
Although we have paid dividends on our Common Stock in the past, there
is no assurance that we may or will continue to pay dividends in the future.
Dividends are subject to determination and declaration by our board of
directors, which takes into account many factors. The declaration of dividends
by us on our Common Stock is subject to the discretion of our board and to
applicable federal regulatory limitations. We cannot guarantee that dividends
will not be reduced or eliminated in future periods. Our ability to pay
dividends on our Common Stock depends on our receipt of dividends from our bank
subsidiary. The Company's subsidiary bank is an Ohio chartered state bank and,
as such, is subject to restrictions and limitations in the amount and timing of
the dividends it may pay to us.
WE HAVE IMPLEMENTED ANTI-TAKEOVER PROVISIONS, ANY OF WHICH MAY DISCOURAGE
TAKEOVER ATTEMPTS AND COULD REDUCE THE MARKET PRICE OF OUR COMMON STOCK.
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Provisions of our Articles of Incorporation and Bylaws and Delaware law
could have the effect of discouraging takeover attempts which certain
stockholders might deem to be in their interest.
THE FAILURE OF OUR COMPUTER SYSTEMS OR THOSE OF OUR KEY VENDORS, SUPPLIERS AND
CUSTOMERS TO BE YEAR 2000 COMPLIANT COULD NEGATIVELY IMPACT OUR BUSINESS.
We are dependent, to a substantial degree, upon the proper functioning
of our computer systems as well as those of our vendors, suppliers and
customers. Most of our information and data is provided electronically and is
dependent on information systems and telecommunications. In addition, most of
our products and services rely on information and data provided by others. If:
- - - our computer systems or those of our vendors and suppliers cannot provide
accurate information in a timely manner;
- - - we are unable to accurately and timely process such information;
- - - our customers are unable to receive and use our products and services; or
- - - a general disruption of our telecommunications and utilities occurs as a
result of the Year 2000 problem,
we could suffer financial loss and potential legal liability.
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WHERE YOU CAN FIND MORE INFORMATION
The Company files annual, quarterly and current reports, proxy
statements and other information with the SEC. You may read and copy any
document we file at the SEC's public reference facilities at 450 Fifth Street,
N.W., Washington D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further
information on the public reference room. The SEC maintains an Internet site
that contains reports, proxy and information statements, and other information
regarding issuers that file electronically with the SEC and the site address is
http:\\www.sec.gov.
The SEC allows the Company to "incorporate by reference" the
information we have filed with them, which means that we can disclose important
information to you by referring you to those documents. The information
incorporated by reference is considered to be part of this Prospectus. We
incorporate by reference all documents listed below and all filings made with
the SEC after the date of the filing of this registration statement pursuant to
Section 13(a), 13(c), 14 or 15 (d) of the Securities Exchange Act of 1934 until
this offering is terminated.
The documents we incorporate by reference are:
1) The Company's Annual Report on Form 10-KSB for the year ended
December 31, 1998;
2) The Company's Quarterly Report on Form 10-QSB for the quarter ended
March 31, 1999;
3) The Company's Report on Form 10-QSB for the quarter ended June 30,
1999;
4) The Company's Report on Form 10-QSB for the quarter ended September
30, 1999;
5) The Company's Reports on Form 8-K dated February 25 and May 7, 1999
and an Amendment on Form 8-K/A to the Form 8-K dated February 25,
1999; and
6) The description of the Company's common stock contained in our
registration statement on Form 10-SB filed with the SEC on April
30, 1998 and in an amendment to our registration statement on Form
10-SB/A filed on August 28, 1998.
You may get copies of any of the incorporated documents (excluding
exhibits, unless the exhibits are specifically incorporated) at no charge to you
by writing Ms. Lynn Bowers, our Corporate Secretary, at One South Main Street,
Niles Ohio 44446 or by calling 330-544-7400.
THE COMPANY
The Company, a bank holding company registered under the Bank Holding
Company Act, is headquartered in Niles, Ohio. The Company provides commercial
banking and related financial services from the 5 branches and offices of its
bank subsidiary, Security Dollar Bank, in Ohio.
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USE OF PROCEEDS
The Company has no basis for estimating the number of shares of Common
Stock that will ultimately be sold by the Company pursuant to the Plan or the
prices at which such shares will be sold. Any net proceeds received by the
Company from the sale of shares under the Plan will be added to the Company's
general funds and used for working capital and general corporate purposes,
including investments in and advances to the Company's subsidiary bank. The
amounts and timing of the application of proceeds will depend upon the funding
requirements of the Company and its subsidiary and the availability of other
funds. Based upon the anticipated growth of the Company's subsidiary bank and
the financial needs of the Company, management anticipates that the Company from
time to time will engage in additional financings of a character and in amounts
that have yet to be determined.
THE PLAN
The following is the description of the Plan.
PURPOSE
1. What is the purpose of the Plan?
The Plan offers holders of Common Stock a systematic method of
investing their cash dividends in Common Stock without the payment of
any brokerage commission, service charge or other expense. Because the
Common Stock will be purchased from the Company, the Plan will also
provide the Company with the means of raising new capital.
2. What are some of the advantages of the Plan?
A participant in the Plan who authorizes reinvestment of dividends will
have the following options:
a. Dividend reinvestment on all shares owned of record or
hereafter acquired of record.
b. The shareholder will indicate the number of shares on which
the shareholder wishes to have dividends reinvested. That
number of shares can be any number, up to and including the
number of shares currently owned of record.
c. Participants can avoid the inconvenience and expense of
safekeeping certificates for shares credited to their Plan
accounts since certificates for such shares will only be
issued at the request of a participant or upon termination of
participation. In addition, participants at no cost may
deposit shares currently participating in the Plan and being
held by them in certificate form with the Plan Administrator.
This will relieve participants of the responsibility for loss,
theft, or destruction of
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their certificates participating in the Plan. All shares held
by the Plan Administrator must be participating in the Plan.
d. Periodic statements of account will simplify record keeping.
e. Dividends on the designated shares will be reinvested in
shares of Common Stock at market price (see Question 10).
There are no brokerage commissions or service charges for
purchases under the Plan. Full investment of funds is possible
because the Plan permits fractions of shares, as well as full
shares, to be purchased. A statement of account will be mailed
to each participant following each payment of a dividend
pursuant to the terms of the Plan.
ADMINISTRATION
3. Who administers the Plan for the participants?
Security Dollar Bank, the Company's wholly owned subsidiary (the
"Administrator"), will administer the Plan, keep records, send
statements of account to participants and perform other duties
pertaining to the Plan. All shares held in the Plan will be held in
book entry by or through the Administrator until a participant makes a
written request for certificates of all or part of his or her shares
(see Question 21). The Administrator acts as the transfer agent of the
Company's Common Stock. All questions and correspondence concerning the
Plan should be addressed to the Administrator as follows:
Security Dollar Bank
Shareholder Relations Department
One South Main Street
Niles, OH 44446-0228
Phone: (330) 544-7400
All shares in the Plan will be credited to the account of Participants,
registered in the name of the Plan and held by the Administrator in
book entry form.
ELIGIBILITY
4. Who is eligible to participate?
All holders of record of shares of Common Stock of the Company are
eligible to participate in the Plan. Before they may participate in the
Plan, any beneficial owner of shares of Common Stock whose shares are
registered in names other than their own (for instance, in the name of
a broker or bank nominee) must either become shareholders of record by
having their shares transferred into their names, or make appropriate
arrangements with their broker or bank to participate in the Plan for
the benefit of such shareholder. The Common Stock of the Company is
Depository Trust Company (DTC) eligible under CUSIP number 81424E107.
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You will not be eligible to participate in the Plan if you reside in a
jurisdiction in which it is unlawful for the Company to permit your
participation.
PARTICIPATION BY SHAREHOLDERS
5. How do shareholders participate?
An eligible shareholder may join the Plan by completing and signing the
Shareholder Authorization Form enclosed herewith and returning it to
the Administrator. A Shareholder Authorization Form and a postage-paid
return envelope may be obtained at any time by writing to Security
Dollar Bank, Shareholder Relations Department, Administration, Security
Financial Corp. Dividend Reinvestment Plan, One South Main Street,
Niles, Ohio 44446-0228.
6. When may an eligible shareholder join the Plan?
An eligible shareholder may join the Plan at any time. If the
Shareholder Authorization Form is received by the Administrator prior
to the dividend record date (dividend record dates normally occur in
March, June, September and November), the next dividend paid will be
used pursuant to the Plan, to purchase shares of Common Stock. If the
Shareholder Authorization Form is received after the dividend record
date, that dividend will be paid in cash and participation in the Plan
will begin with the subsequent cash dividend payment.
7. What does the Shareholder Authorization Form provide?
The Shareholder Authorization Form enrolls the participant in the Plan
and it directs the Administrator to either reinvest all dividends or
dividends on a designated number of shares of the Common Stock
registered in the participant's name. The number of shares on which the
shareholder may reinvest dividends may be any number of one or more, up
to and including the number of shares currently owned of record.
8. Can shareholders participate with less than 100% of their cash
dividends?
Yes. Eligible shareholders have the option under the Plan to designate
the number of shares to participate in the dividend reinvestment plan.
Once the number of shares to participate has been selected, that number
will remain in effect until the election is changed.
9. Can shareholders change their election under the Plan?
Yes. At any time, shareholders may change their election of the number
of shares of Common Stock participating in the Dividend Reinvestment
Plan. To do so, a new Shareholder Authorization Form must be completed
and returned. The answer to Question 5 describes how to obtain a
Shareholder Authorization Form and a return envelope. Any change of
election concerning the reinvestment of dividends must be
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received by the Administrator prior to the dividend record date to be
effective for that dividend.
PURCHASES
10. What will be the price of Common Stock purchased under the Plan?
The price per share of Common Stock purchased under the Plan will be
the midpoint, computed to six decimal places, between the highest asked
and lowest asked price per share for transactions in the Common Stock
over the ten business days immediately preceding the dividend payment
date on which purchases of Common Stock at such price are being made.
11. How are shares acquired under the Plan?
Shares of Common Stock of the Company acquired by participants in the
Plan will be purchased from the Company.
12. How will the number of shares purchased for each participant be
determined?
The number of shares that will be purchased from a participant's
dividend will depend on the amount of that dividend and the applicable
purchase price of the Common Stock. The participant's account will be
credited with the number of shares, including any fractional share
(computed to the sixth decimal place), that results from dividing the
amount of dividends plus any optional cash payments to be invested by
the applicable purchase price.
13. When will purchases of Common Stock be made?
The Administrator will purchase Common Stock for the Plan on each
dividend payment date.
DIVIDENDS
14. Will dividends be paid on shares held in Plan accounts?
Yes. Cash dividends on full shares and any fraction of a share credited
to each Plan account will be reinvested automatically in full under the
Plan in additional shares of Common Stock and credited to each account.
COSTS
15. Are there any out-of-pocket expenses to a shareholder who participates
in the Plan?
No. All out-of-pocket costs and expenses associated with the operation
of the Plan, including service charges, will be paid by the Company.
However, a participant who
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withdraws from participation in the Plan and instructs the
Administrator to sell the Common Stock then held in the Plan for his or
her account will be responsible for his or her prorata share of
applicable brokerage commissions, if any.
OPTIONAL CASH PAYMENTS
16. May cash be added to purchase additional shares?
Yes. Additional shares may be purchased with optional cash payments by
participants in the Dividend Reinvestment Plan.
17. When can optional cash payments be made?
Optional cash payments received by the Administrator will be invested
in additional shares concurrently with the dividend being reinvested.
The Administrator will accept optional cash payments at anytime
following a cash dividend record date and prior to such dividend's
payment date. The Administrator will return to participants any
optional cash payments which are not invested within thirty (30) days
following such cash dividend's payable date. Optional cash payments
received after the payable date for a dividend will be received too
late to be invested with the proceeds received by the Administrator
from such dividend and the optional cash payment will be returned to
the participant. NO INTEREST WILL BE PAID ON ANY OPTIONAL CASH PAYMENT
WHILE HELD BY THE ADMINISTRATOR.
18. What is the maximum aggregate amount of cash that can be invested
through optional cash payments?
Up to $1,000 per calendar quarter in optional cash payments can be
invested in the Plan. Each optional cash payment must be at least $100.
The same amounts of cash need not be sent each quarter, and there is no
obligation to make an optional cash payment each quarter.
In the case of a nominee who holds Common Stock for more than one
beneficial owner, optional cash investments of more than $1,000 per
quarter may be made provided such nominee certifies to the
Administrator and the Company, accompanied by such documentation as the
Company may require, that each beneficial owner is not making optional
cash investments in excess of the quarterly limit.
The Company reserves the right, in its sole discretion, to determine
who is an owner for purposes of the foregoing restriction, and, without
limitation, to determine whether optional cash payments by any
particular owner aggregate more than $1,000 in any quarter. The Company
may require evidence satisfactory to it in its sole discretion to
demonstrate compliance with the $1,000 limitation.
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19. How can I make an optional cash payment to purchase additional shares?
A participant can make an optional cash payment to purchase additional
shares by returning the Authorization Form, completed for your optional
cash investment, to the Administrator with a check or money order made
payable to Security Dollar Bank at the address in paragraph 3 above.
PLEASE DO NOT SEND CASH. THE ADMINISTRATOR WILL PROVIDE AUTHORIZATION
FORMS TO PARTICIPANTS UPON REQUEST.
REPORTS TO PARTICIPANTS
20. What reports will be sent to participants in the Plan?
A statement of account showing amounts invested, purchase prices,
shares purchased, and other information for the year to date will be
mailed quarterly to each participant as soon as practicable after each
purchase of Common Stock, normally within 10 business days following
such purchase. THESE STATEMENTS ARE A CONTINUING RECORD OF CURRENT
ACTIVITY AND THE COST OF PURCHASES AND SHOULD BE RETAINED FOR TAX
PURPOSES. A YEAR-END STATEMENT WILL ALSO BE MAILED.
In addition, participants will receive copies of communications sent to
all holders of the Company Common Stock, including the annual report to
shareholders, any quarterly report provided to shareholders, a notice
of the annual meeting of shareholders and proxy statements, and
information for reporting dividend income for federal income tax
purposes.
CERTIFICATES FOR SHARES
21. Will certificates be issued for shares of Common Stock purchased under
the Plan?
No certificate will be issued to a participant for shares of Common
Stock credited to his or her Plan account unless he or she requests the
Plan Administrator, in writing, to do so, or until the participant's
account is terminated. Shares of Common Stock purchased through the
Plan for a participant will be credited to the account of the
participant, registered in the name of the Plan and held in book entry
form. The number of shares credited to a participant's Plan account, as
well as the number of shares of Common Stock on which dividends are
being reinvested will be shown on the periodic statement of the
participant's account.
A participant may, at any time, request in writing that the Plan
Administrator send the participant a certificate for all or part of the
whole shares of Common Stock credited to his or her Plan account. Any
remaining whole or fractional shares will continue to be credited to
the Plan account. Certificates for fractional shares will not be issued
under any circumstances.
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22. In whose name will certificates be registered when issued?
Accounts under the Plan will be maintained in the name in which
participants' shares of Common Stock were registered at the time they
enrolled in the Plan. Consequently, certificates for whole shares of
Common Stock will be similarly registered when issued unless the
participant requests issuance of the shares in a different name(s). If
different registration of the shares is desired, the participant should
call the Plan Administrator for transfer instructions (see Question 3).
23. May shares in a Plan account be pledged?
No. Shares of Common Stock credited to the Plan account may not be
pledged or assigned, and any such purported pledge or assignment shall
be void. A participant who wishes to pledge or assign such shares must
request that a certificate for such shares be issued in his or her
name.
WITHDRAWAL OF SHARES
24. How does a participant withdraw shares from the Plan?
A participant may withdraw all or a portion of the whole shares of
Common Stock credited to his or her Plan account by notifying the Plan
Administrator in writing (see Question 3), specifying the number of
whole shares to be withdrawn. Certificates for whole shares of Common
Stock so withdrawn will be issued to the participant at the earliest
possible opportunity. In no case will certificates for fractional
shares be issued. After a participant withdraws shares of Common Stock
from his or her Plan account, cash dividends on such shares will
continue to be reinvested in accordance with the instructions given by
the participant on his or her most recently dated Authorization Form,
so long as the participant remains the record holder of such shares and
has not terminated his or her participation in the Plan.
25. Can a participant sell shares of Common Stock held in his or her Plan
account?
A participant may request that all or a portion of the shares of Common
Stock held in his or her Plan account be sold by completing the "Sale
of Shares" section at the bottom of his or her account statement or by
writing a letter of instruction to the Plan Administrator (see Question
3). Any such request must be signed by a person named on the Plan
account. Sale of shares of Common Stock held in a participant's Plan
account does not terminate Plan participation if the participant
remains the registered owner of at least one share of Common Stock,
unless the participant specifically requests such termination. Sales
will be executed within ten business days of receipt by the Plan
Administrator of a duly executed request. Proceeds from the sale of
shares of Common Stock will depend on, among other things, the market
price of the Common Stock at the time the sale order is directed by the
Plan Administrator. Such market price may vary significantly between
the time the participant submits his or her request for sale of the
shares and the time the sale order is directed by the Plan
Administrator with a broker. There can be no guarantee
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that the shares of Common Stock will be sold at a specific price. The
participant will receive a check for the proceeds of the sale, less any
brokerage commission and any applicable transfer tax incurred.
26. What happens to any fractional share when a participant directs the
Plan Administrator to sell or withdraw all shares from his or her Plan
account?
Any fractional share will be directed to be sold by the Plan
Administrator and a cash payment made for the sale price thereof, less
any brokerage commission and transfer tax incurred. The net proceeds of
any fractional share, together with any proceeds from the sale of whole
shares or a certificate for whole shares, as the case may be, will be
mailed to the participant.
TERMINATION OF PARTICIPATION IN THE PLAN
27. How does a participant terminate participation in the Plan?
A participant may terminate his or her participation in the Plan at any
time by notifying the Plan Administrator in writing (see Question 3).
If notice of termination is received at least two weeks before the
record date for a cash dividend, that dividend will be paid, in cash,
to the participant; otherwise that dividend will be reinvested for the
participant's Plan account. No terminations will be processed between a
dividend record date and a dividend payment date. Any requests for
termination of participation received during this period will be held
until the shares purchased with the dividend are posted to the
participant's account. Any optional cash payment which has been
received by the Plan Administrator prior to receipt of notice to
discontinue dividend reinvestment will be invested in accordance with
the Plan unless return of the payment is requested in a written notice
received by the Plan Administrator at least one week prior to the date
when such cash payment is to be invested. Thereafter, the participant's
participation in the Plan will be terminated, the Plan account will be
closed, and all dividends on Common Stock held by the participant of
record will be paid directly to that participant.
Termination of dividend reinvestment will automatically terminate a
participant's right to invest in additional shares of Common Stock by
making optional cash payments.
28. What will participants receive when they terminate participation in the
Plan?
The Plan Administrator will send to a participant who has terminated
participation in the Plan a certificate for the number of whole shares
in his or her Plan account unless directed otherwise. Any fractional
share will be sold and a cash payment will be made to the participant
for the sale price thereof, less any brokerage commission and transfer
tax incurred.
29. May a former participant later rejoin in the Plan after termination?
15
<PAGE> 17
Yes. Any eligible shareholder of record may rejoin the Plan at any time
by completing a new shareholder Authorization Form. However, the
Company may reject any such Form from a previous participant on grounds
of excessive termination and rejoining.
GENERAL INFORMATION
30. What happens when a participant sells or transfers all shares of Common
Stock held in certificate form?
If a participant disposes of all of the shares of Common Stock held in
certificate form the Plan Administrator will continue to reinvest the
dividends on all shares credited to that participant's Plan account,
provided there is at least one full share of Common Stock in his or her
Plan account.
31. What happens when a participant who is reinvesting dividends on all or
a portion of the shares of Common Stock held in certificate form sells
or transfers a portion of such shares?
If a participant who is reinvesting cash dividends on all of the shares
of Common Stock held in certificate form disposes of a portion of such
shares, the Plan Administrator will continue to reinvest the dividends
on the remainder of such shares and, of course, will continue to
reinvest the dividends on the shares of Common Stock credited to the
participant's Plan account.
If a participant who is reinvesting cash dividends on a portion of the
shares of Common Stock held in certificate form disposes of a portion
of such shares, the Plan Administrator will continue to reinvest cash
dividends on the remainder of such shares up to the number of shares of
Common Stock authorized in the participant's most recently dated
Authorization Form and will continue to reinvest the cash dividends on
the shares credited to the participant's Plan account.
For example, if a participant selected the partial dividend
reinvestment option and authorized the Plan Administrator to reinvest
the cash dividends paid on 50 shares of a total of 100 shares of Common
Stock held in certificate form, and then the participant disposes of 25
shares of Common Stock, the Plan Administrator would continue to
reinvest the cash dividends paid on 50 of the remaining 75 shares. If
instead the participant disposed of 75 shares of Common Stock, the Plan
Administrator would continue to reinvest the cash dividends paid on the
remaining 25 shares of Common Stock.
16
<PAGE> 18
32. What happens if the Company declares a stock dividend or stock split?
Shares of Common Stock distributed by the Company pursuant to a stock
dividend or a stock split with respect to shares of Common Stock owned
by the participant and held in certificate form will be issued in
certificate form to the Participant, which additional shares will
participate in the reinvestment of dividends if the option to reinvest
on all shares was selected at the time of enrollment. (See Question 8).
Shares of Common Stock issued pursuant to a stock split or stock
dividend on shares held in the plan and allocated to the account of a
participant, will be automatically added to such account and will
automatically participate in the reinvestment of dividends.
33. How will a participant's shares held by the Plan Administrator be voted
at shareholder's meetings?
Each participant in the Plan will receive a voting authorization card
on which to indicate how the shares held by the Plan Administrator in
such participant's Plan account should be voted. The Plan Administrator
will vote at any annual or special meeting of shareholders full shares
of Common Stock held for each participant's account under the Plan in
accordance with the directions provided by the participant to the Plan
Administrator. Fractional interests will not be voted. In the event
that a participant provides no direction to the Plan Administrator,
shares held by the Plan Administrator for that participant under the
Plan will not be voted. If a participant also holds shares of Common
Stock registered in his or her own name, such participant will receive
a separate proxy card for those shares in connection with any meeting
of shareholders.
34. What is the responsibility of the Company and the Plan Administrator
under the Plan?
In administering the Plan, the Company and the Plan Administrator will
not be liable for any act done in good faith or for any good faith
omission to act including, without limitation, any claim of liability
arising out of failure to terminate a participant's Plan account upon
such participant's death or adjudicated incompetency prior to receipt
of notice in writing of such death or incompetency, or any claim with
respect to the timing or price of any purchase or sale.
PARTICIPANTS MUST RECOGNIZE THAT NEITHER THE COMPANY NOR THE PLAN
ADMINISTRATOR CAN ASSURE THEM OF A PROFIT OR PROTECT THEM AGAINST A
LOSS ON SHARES PURCHASED OR SOLD UNDER THE PLAN.
The Plan does not represent a change in the Company's dividend policy
or a guarantee of future dividends, which will continue to be
determined by the Board of Directors in light of the Company's
earnings, financial condition and other factors.
35. May the Plan be changed or discontinued?
Although the Company intends to continue the Plan in the future, the
Company reserves the right to amend, suspend, modify or terminate the
Plan at any time. Written notice of
17
<PAGE> 19
any such amendment, suspension, modification or termination will be
sent by the Company to participants, but the absence of notification
will not affect the effectiveness of the amendment, suspension,
termination or modification.
If the Company terminates the Plan for the purpose of establishing
another dividend reinvestment and Common Stock purchase plan,
participants in the Plan will, if the Company so elects, be enrolled
automatically in such other plan and shares credited to their Plan
accounts will be credited automatically under such other plan unless
notice to the contrary is received.
The Company also reserves the right to terminate any shareholder's
participation in the Plan at any time.
36. How is the Plan to be interpreted?
Any question of interpretation arising under the Plan will be
determined by the Company and any such interpretation will be final.
The Company may adopt rules and regulations for the administration of
the Plan.
37. What is sufficient notice to a participant?
Any notice or certificate which is to be given by the Plan
Administrator to a participant shall be in writing and shall be deemed
to have been sufficiently given for all purposes when deposited,
postage prepaid, in the United States mail, addressed to the
participant at the participant's address as it shall last appear on the
Plan Administrator's records.
38. Can successor Plan Administrators be named?
The Company may from time to time designate a successor Plan
Administrator under the Plan.
39. What are the income tax consequences of participation in the Plan?
The following summary sets forth the general federal income tax
consequences for an individual participating in the Plan. This
discussion is not, however, intended to be an exhaustive treatment of
such tax considerations. Future legislative changes or changes in
administrative or judicial interpretations, some or all of which may be
retroactive, could significantly alter the tax treatment discussed
herein. Accordingly, and because tax consequences may differ among
participants in the Plan, each participant is urged to consult his or
her own tax advisor to determine the particular tax consequences
(including state income tax consequences) that may result from
participation in and the subsequent disposal of shares purchased under
the Plan.
In general, participants reinvesting dividends under the Plan have the
same federal income tax consequences with respect to their dividends as
do shareholders who are not
18
<PAGE> 20
participants in the Plan. On the dividend payment date, participants
will receive a taxable dividend equal to the cash dividend reinvested,
to the extent the Company has earnings and profits. This treatment
applies with respect to both the shares of Common Stock held of record
by such participants and such participants' Plan account shares even
though the dividend amount is not actually received in cash but is
instead applied to the purchase of shares of Common Stock under the
Plan.
Shares or any fractional interest thereof of Common Stock purchased
from the Company with reinvested dividends will have a tax basis equal
to the amount of such reinvested dividends. The shares or any
fractional interest thereof will have a holding period beginning on the
day following the purchase date.
Shares or any fractional interest thereof purchased with optional cash
investments will have a tax basis equal to the amount of such payments.
The holding period for such shares or fractional interest thereof will
begin on the day following the purchase date.
Participants will not recognize any taxable income when they receive
certificates for whole shares credited to their account, either upon
their request for such certificates or upon withdrawal from or
termination of the Plan. However, participants will recognize gain or
loss when whole shares acquired under the Plan are sold or exchanged
either through the Plan at their request or by the participants after
withdrawal from or termination of the Plan. Participants will also
recognize gain or loss when they receive cash payments for fractional
interests in shares credited to their account upon withdrawal from or
termination of the Plan. The amount of gain or loss will be the
difference between the amount a participant receives for his or her
whole shares or fractional interests and the tax basis for such shares.
Provided that the shares are capital assets in the hands of the
participant, the gain or loss will be a capital gain or loss, and will
be long-term or short-term depending on the holding period.
If a participant is a foreign shareholder whose dividends are subject
to United States income tax withholding, or a participating domestic
shareholder subject to backup withholding, the tax required to be
withheld will be deducted from the amount of cash dividends reinvested.
Since such withholding tax applies also to a dividend on shares
credited to the participant's Plan account, only the net dividend on
such shares will be applied to the purchase of additional shares of
Common Stock. The Company cannot refund amounts withheld. Participants
subject to withholding should contact their tax advisors or the IRS for
additional information.
LEGAL OPINION
A legal opinion to the effect that the shares of Common Stock offered
hereby have been duly authorized and, upon issuance in accordance with the terms
of the Plan will be validly issued, fully paid and nonassessable, has been
rendered by Werner & Blank Co., L.P.A.
19
<PAGE> 21
EXPERTS
The consolidated financial statements incorporated in this Prospectus
by reference from the Company's Annual Report on Form 10-KSB for the year ended
December 31, 1998 have been audited by S. R. Snodgrass, A.C., independent
auditors, as stated in their report which is incorporated herein by reference,
and have been so incorporated in reliance upon the report of such firm given
upon their authority as experts in accounting and auditing.
INDEMNIFICATION
Under the Company's Bylaws, directors and officers of the Company are
entitled to be indemnified to the fullest extent permitted by law in connection
with actual or threatened lawsuits or proceedings arising out of their service
to the Company or to another organization at the request of the Company. With
respect to indemnification of directors, officers and controlling persons of the
Company for liabilities arising under the Securities Act of 1933, the Company
has been informed that, in the opinion of the Securities Exchange Commission,
such indemnification is against public policy as expressed in that Act and is
therefore, unenforceable.
20
<PAGE> 22
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following is an itemized statement of expenses (all but the
registration fee are estimates) of the Registrant in connection with the
issuance and sale of the shares of Common Stock being registered.
<TABLE>
<S> <C>
Registration fee $ 992.00
Printing $ 10,000.00
Blue Sky fees and expenses $ 2,000.00
Legal fees and expenses $ 12,500.00
Accounting fees and expenses $ 1,000.00
Miscellaneous $ 1,000.00
-------------
TOTAL $ 27,492.00
=============
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the Delaware General Corporation Law, as amended (the
"Delaware GCL"), permits, under certain circumstances, the indemnification of
any person with respect to any threatened, pending, or completed action, suit,
or proceeding, whether civil, criminal, administrative, or investigative, to
which such person was or is a party or is threatened to be made a party by
reason of the fact that such person is or was a director, officer, employee, or
agent of the corporation or was serving in a similar capacity for another
enterprise at the request of the corporation. To the extent that a director,
officer, employee or agent of the corporation has been successful in defending
any such proceeding, the Delaware GCL provides that he shall be indemnified
against expenses (including attorneys' fees) actually and reasonably incurred by
him in connection therewith.
With respect to a proceeding by or in the right of the corporation,
such person may be indemnified against expenses (including attorneys' fees) if
he acted in good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the corporation. The statute provides, however,
that no indemnification is allowed in such a proceeding if such person is
adjudged liable to the corporation unless, and only to the extent that, the
court may, upon application, determine that he is entitled to indemnification
under the circumstances. With respect to proceedings other than those brought by
or in the right of the corporation, such person may be indemnified against
judgments, fines, and amounts paid in settlement, as well as expenses, if he
acted in good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the corporation and, with respect to any
criminal action, had no reasonable cause to believe his conduct was unlawful,
notwithstanding the outcome of the proceeding. Except with respect to mandatory
indemnification of expenses to successful
<PAGE> 23
defendants as described in the preceding paragraph or pursuant to a court order,
the indemnification described in this paragraph may be made only upon a
determination in each specific case by majority vote of a quorum of directors
not parties to the proceeding, by written opinion of independent legal counsel,
or by the stockholders, that the defendant met the applicable standard of
conduct described above.
The Delaware GCL permits a corporation to advance expenses incurred by
a proposed indemnitee in advance of final disposition of the proceeding provided
the indemnitee undertakes to repay such advanced expenses if it is ultimately
determined that he is not entitled to indemnification. A corporation may
purchase insurance on behalf of an indemnitee against any liability asserted
against him in his designated capacity, whether or not the corporation itself
would be empowered to indemnify him against such liability.
Delaware law also provides that the above rights shall not be deemed
exclusive of other rights of indemnification or advancement of expenses under
any bylaw, agreement, vote of stockholders or disinterested directors, or
otherwise.
Under the Registrant's Bylaws, it must advance expenses incurred by the
director or officer subject to delivery of an undertaking by or on behalf of the
director or officer to repay the expenses only if it is ultimately determined
that the director or officer is not entitled to indemnification.
The Registrant's Bylaws provide that each person who was or is made a party to,
or is involved in, any action, suit or proceeding by reason of the fact that he
or she is or was a director or officer of the Registrant (or was serving at the
request of the Registrant as a director, officer, employee or agent for another
entity) while serving in such capacity shall be indemnified and held harmless by
the Registrant, to the fullest extent authorized by the Delaware GCL, as in
effect (or, to the extent authority for indemnification is broadened, as it may
be amended) against all expense, liability or loss (including attorneys' fees,
judgements, fines, Employee Retirement Income Security Act ("ERISA") excise
taxes or penalties, amounts paid or to be paid in settlement), reasonably
incurred or suffered by such person in connection therewith.
As noted above, the Registrant's Bylaws generally require the Registrant to
indemnify its directors and officers to the fullest extent permitted by the
Delaware GCL and are intended to provide the maximum protection available under
the Delaware GCL. Because this provision is tied to the Delaware GCL, it may be
modified by future changes in such law without further shareholder action. The
Registrant's Bylaws expressly provide, however, that any such modification would
be effective (for acts or omissions prior to the date of a change) only to the
extent it would provide broader indemnification rights than those available
under then existing law. In addition, the Registrant's Bylaws provide that all
rights to indemnification and advances granted by such Bylaws shall be deemed to
be contractual obligations between the Registrant and its directors and
officers. Accordingly, the Bylaw provision cannot be repealed without the
consent of the indemnitee. Repeal or modification of the Bylaw provision would
only be effective on a prospective basis and would not affect rights to
indemnification and expense advances in effect at the time of any act or
omission that is the subject of a proceeding against a director or officer.
Indemnification under any contract or agreement entered into between the
<PAGE> 24
Registrant and its directors and officers would likewise not be affected by any
such Bylaw repeal or modification.
The Registrant's Bylaw provisions are intended to indemnify for conduct which is
determined to be grossly negligent or reckless. Insofar as indemnification for
liabilities arising under the Securities Act may be permitted to directors,
officers and other agents of the Registrant pursuant to the foregoing provisions
or otherwise, the Registrant has been advised that, in the opinion of the
Commission, such indemnification is contrary to public policy expressed in the
Securities Act and is therefore unenforceable, absent a decision to the contrary
by a court of competent jurisdiction.
Section 102 (b) (7) of the Delaware GCL permits Delaware corporations
in their certificates of incorporation to eliminate or limit the personal
liability of directors to the corporation or its stockholders for monetary
damages for breaches of certain duties. Under the Registrant's Certificate of
Incorporation, a director of the Registrant shall have no personal liability to
the Registrant or its stockholders for monetary damages for breach of fiduciary
duty as a director, with the exception of liability: (i) for any breach of the
director's duty of loyalty to the Registrant or its stockholders; (ii) for acts
or omissions not in good faith or that involve intentional misconduct or a
knowing violation of law, (iii) for unlawful dividends; or (iv) for any
transaction from which the director derived an improper personal benefit.
The Registrant anticipates that it will maintain director and officer
insurance in customary amounts consistent with the provisions of the Delaware
GCL.
ITEM 16. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
See the Index to Exhibits of this Registration Statement on Form S-3.
ITEM 17. UNDERTAKINGS.
(a) The undersigned Registrant hereby undertakes
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this Registration Statement
<PAGE> 25
to include any material information with respect to the plan of distribution
not previously disclosed in the Registration Statement or any material change to
such information in the Registration Statement.
(2) That, for the purpose of determining any liability under
the Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
<PAGE> 26
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Niles, State of Ohio, this 11th day of November,
1999.
Security Financial Corp.
/s/ Glenn E. Griffiths
------------------------------------
Glenn E. Griffiths
President and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Glenn E. Griffiths
- - -----------------------------------------
Glenn E. Griffiths President, Chief Executive Officer November 11, 1999
and Director (Principal Executive Officer) -----------------
/s/ Stephen K. Miller
- - -----------------------------------------
Stephen K. Miller Treasurer November 11, 1999
(Principal Accounting Officer) -----------------
/s/ *
- - -----------------------------------------
Robert J. McClurkin Director November 11, 1999
-----------------
/s *
- - -----------------------------------------
Douglas J. Neuman Director November 11, 1999
-----------------
/s/ *
- - -----------------------------------------
Peter P. Rossi, Jr. Director November 11, 1999
-----------------
/s *
- - -----------------------------------------
Christopher J. Shaker Director November 11, 1999
-----------------
*
- - -----------------------------------------
Robert I. Griffith, Jr. Director November 11, 1999
-----------------
*
- - -----------------------------------------
Gary A. Clayman Director November 11, 1999
-----------------
</TABLE>
II-5
<PAGE> 27
* Glenn E. Griffiths hereby signs this Registration Statement on November 11,
1999, on behalf of each of the persons so indicated for whom he is
attorney-in-fact pursuant to a power of attorney filed herewith, which persons,
together with the undersigned, constituted a majority of the Registrant's Board
of Directors.
/s/ Glenn E. Griffiths
----------------------
Glenn E. Griffiths
<PAGE> 28
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit No. Exhibit
----------- -------
<S> <C>
4 Shareholder Authorization Form for use in connection with the
Security Financial Corp. Dividend Reinvestment and Stock
Purchase Plan
5 Opinion of Werner & Blank Co., L.P.A. as to validity of
securities registered
23.1 Consent of S. R. Snodgrass, A. C., independent auditors for
the Registrant
23.2 Consent of Werner & Blank Co., L.P.A., regarding opinion
(contained in Exhibit 5)
24 Power of Attorney
</TABLE>
<PAGE> 1
EXHIBIT 4
SHAREHOLDER AUTHORIZATION FORM
SECURITY FINANCIAL CORP.
DIVIDEND REINVESTMENT AND STOCK PURCHASE PLAN
1. DIVIDEND REINVESTMENT
(Check only one box - fill in amount where appropriate)
| | a. Full Cash Dividend Reinvestment. I wish to reinvest under the Plan cash
dividends on all shares registered in my name.
| | b. Partial Cash Dividend Reinvestment. I wish to have cash dividends
reinvested on shares personally held by me in certificate
form and on all Plan shares held in my name. I wish to have the balance
of my cash dividends mailed to me.
2. OPTIONAL CASH INVESTMENTS (minimum $100 and maximum $1,000 per quarter)
| | a. Cash Payment. Please buy shares with the enclosed check or money order
for $ payable to Security Dollar Bank.
To the extent I have so designated, I hereby elect to participate in the Plan
and authorize Security Dollar Bank, as my agent, to apply cash dividends and any
optional cash investments received by it on my behalf to the purchase of shares
of Security Financial Corp. Common Stock. I understand that all dividends
received on shares credited to my Plan account will be automatically reinvested
in Security Financial Corp. Common Stock.
- - ----------------------------------------------------------------------------- *
Signature
- - ----------------------------------------------------------------------------- *
Signature
Date
-------------------------------------------------------------------------
(PLEASE SIGN ABOVE EXACTLY AS NAME APPEARS ON REVERSE SIDE. IF SHARES ARE
HELD JOINTLY, EACH SHAREHOLDER MUST SIGN.
* Under penalties of perjury, I certify (1) that the number shown on the reverse
of this Form is my correct Taxpayer Identification Number and (2) that I am not
subject to backup withholding because: (a) I am exempt from backup withholding,
or (b) I have not been notified by the Internal Revenue Service (the "IRS") that
I am subject to backup withholding as a result of a failure to report all
interest or dividends, or (c) the IRS has notified me that I am no longer
subject to backup withholding.
<PAGE> 2
SHAREHOLDER AUTHORIZATION FORM
SECURITY FINANCIAL CORP.
<TABLE>
<CAPTION>
<S><C>
DIVIDEND REINVESTMENT AND STOCK PURCHASE PLAN
- - ------------------------------------------------------------------------------------------------------------------------------------
NAME(S) EXACTLY AS SET FORTH ON YOUR STOCK CERTIFICATE
- - ------------------------------------------------------------------------------------------------------------------------------------
ADDITIONAL SPACE FOR NAME(S) IF NECESSARY
- - ------------------------------------------------------------------------------------------------------------------------------------
STREET ADDRESS
- - ------------------------------------------------------------------------------------------------------------------------------------
CITY STATE ZIP CODE
- - ---------------------------------------------- ----------------------------------- -----------------------------------------------
| | I am a U.S. Citizen or Resident Alien
Social Security Number (To be Employer Identification Number (to | | I am a Nonresident Alien
completed if the shareholder is an be completed if the shareholder is
individual. If shares are held jointly, not an individual.)
the Social Security Number should be
that of the first person listed on the
stock certificate.)
</TABLE>
BE SURE TO COMPLETE BOTH SIDES OF THIS FORM.
MAIL TO SECURITY DOLLAR BANK, ATTN: SHAREHOLDER RELATIONS DEPARTMENT
ONE SOUTH MAIN STREET, NILES, OH 44446
<PAGE> 1
EXHIBIT 5
November 11, 1999
Security Financial Corp.
One South Main Street
Niles, Ohio 44446
Re: Dividend Reinvestment and Stock Purchase Plan - Issuance of Shares
Gentlemen:
This letter is written in connection with the Registration Statement on
Form S-3 (the "Registration Statement") to be filed with the Securities and
Exchange Commission (the "Commission"), pursuant to the Securities Act of 1933,
as amended (the "Securities Act"), for the purpose of registering 50,000 shares
(the "Shares") of common stock, no par value (the "Common Stock"), of Security
Financial Corp. (the "Company"), to be offered and sold pursuant to the
Company's Dividend Reinvestment and Stock Purchase Plan (the "Plan").
For purposes of rendering the opinion expressed below, I have examined
and relied upon originals, or copies certified to my satisfaction, of such
records, documents, certificates of public officials and officers of the
Company, and other documents and instruments as I have deemed appropriate.
In conducting my examination, I have assumed, without investigation,
the genuineness of all signatures, the correctness of all certificates, the
authenticity of all documents submitted to me as originals, the conformity to
original documents of all documents submitted to me as certified or photostatic
copies and the authenticity of the originals of such copies, and the accuracy
and completeness of all records made available to me by the Company. In
rendering my opinion below, I have assumed, without investigation, that any
certificate or other document on which I have relied that was given or dated
earlier than the date of this letter continued to remain accurate insofar as
relevant to such opinion, from such earlier date through and including the date
of this letter. In addition, I have assumed, without investigation, the accuracy
of the representations and statements as to factual matters made in the
Registration Statement and in the prospectus to be delivered to each shareholder
and employee of the Company participating in the Plan (the "Prospectus"), and
the accuracy of representations and statements as to factual matters made by the
officers and employees of the Company and public officials.
The opinion expressed below is subject, without investigation, to the
following assumptions:
<PAGE> 2
Security Financial Corp.
November 11, 1999
Page 2
A. The Registration Statement will become automatically effective on
the day of the filing thereof with the Commission pursuant to Rule 462 under the
Securities Act, and, together with any subsequent amendments thereto, will
continue to remain effective under the Securities Act, throughout all periods
relevant to the opinion expressed below.
B. The Prospectus will fulfill, and, together with any subsequent
amendments or supplements thereto, will continue to fulfill all of the
requirements of the Securities Act, throughout all periods relevant to the
opinion expressed below.
C. The resolutions of the board of directors authorizing the adoption
of the Plan, any amendment to the Plan, or the offer, sale and issuance of the
Shares pursuant to the Plan, (the "Authorizing Resolutions") will not be revoked
or rescinded, and no amendment, modification, or other alteration of the
Authorizing Resolutions will cause such resolutions, as amended, to deviate
materially in substance from the provisions of the Authorizing Resolutions as in
effect on the date hereof.
D. All offers, sales and issuances of the Shares will be made in a
manner (i) which complies with the terms, provisions and conditions described in
the Prospectus and any amendments or supplements to the Prospectus, and (ii)
which is within the scope of the Authorizing Resolutions.
E. All offers, sales and issuances of the Shares will be made in
accordance with the terms, provisions, and conditions of the Plan.
F. All offers, sales and issuances of the Shares will comply with the
securities laws of the states having jurisdiction thereover.
G. At all times relevant to the opinion set forth below, the Company
has been and will remain in good standing in Delaware and in each foreign
jurisdiction where qualification is required.
H. No subsequent amendment, modification or other alteration of the
Plan, the Prospectus or the Registration Statement will cause the terms,
provisions and conditions relating to the offer, sale and issuance of the Shares
pursuant thereto to deviate materially in substance from said terms, provisions
and conditions as described therein on the date hereof.
The opinion expressed below is subject to the following qualifications:
(a) The opinion expressed below is limited to the matters expressly set
forth in this opinion letter, and no opinion is to be implied or may be inferred
beyond the matters expressly so stated.
<PAGE> 3
Security Financial Corp.
November 11, 1999
Page 3
(b) I disclaim any obligation to update this opinion letter for events
occurring after the date of this opinion letter.
(c) The opinion expressed below is limited to the effect of the General
Corporation Law of the State of Delaware; accordingly, no opinion is expressed
with respect to the laws of any other jurisdiction, or the effect thereof, on
the offer, sale or issuance of the Shares.
Based upon and subject to the foregoing, I am of the opinion that the
Shares, when issued, will be validly issued, fully paid and nonassessable.
* * *
I hereby consent to the filing of this opinion letter as an exhibit to
the Registration Statement. This opinion letter is rendered solely for your
benefit in connection with the Registration Statement. Except as provided in
this opinion letter, without my prior written consent, this opinion letter may
not be: (i) relied upon by any other person or for any other purpose; (ii)
quoted in whole or in part or otherwise referred to in any report or document;
or (iii) furnished (the original or copies thereof) to any other person.
Sincerely,
/s/ Werner & Blank Co., L.P.A.
Werner & Blank Co., L.P.A.
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation in this Registration Statement of Security
Financial Corp. (the "Company") on Form S-3, of our report dated January 22,
1999 on the 1998 consolidated financial statements of the Company, which report
is included in the Company's Annual Report on Form 10-KSB for the year ended
December 31, 1998. We also consent to the reference to our firm under the
heading "Experts" in the prospectus, which is part of this Registration
Statement.
/s/ S. R. Snodgrass, A.C.
S. R. Snodgrass, A.C.
Wexford, Pennsylvania
November 1, 1999
<PAGE> 1
EXHIBIT 24
POWERS OF ATTORNEY
DIRECTORS OF SECURITY FINANCIAL CORP.
Know all men by these presents that each person whose name is signed
below has made, constituted and appointed, and by this instrument does make,
constitute and appoint Glenn E. Griffiths, his true and lawful attorney with
full power of substitution and resubstitution to affix for him and in his name,
place and stead, as attorney-in-fact, his signature as director or officer, or
both, of Security Financial Corp., a Delaware corporation, (the "Company"), to a
Registration Statement on Form S-3 or other form registering common stock of the
Company under the Securities Act of 1933 in connection with the Company's
Dividend Reinvestment Plan and Stock Repurchase Plan, and to any and all
amendments, post effective amendments and exhibits to that Registration
Statement, and to any and all applications and other documents pertaining
thereto, giving and granting to such attorney-in-fact full power and authority
to do and perform every act and thing whatsoever necessary to be done in the
premises, as fully as he might or could do if personally present, and hereby
ratifying and confirming all that said attorney-in-fact or any such substitute
shall lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, this Power of Attorney has been signed at Niles,
Ohio, this 26th day of August, 1999.
/s/ Glenn E. Griffiths
- - -----------------------------------------------
Glenn E. Griffiths
/s/ Robert J. McClurkin
- - -----------------------------------------------
Robert J. McClurkin
/s/ Douglas J. Neuman
- - -----------------------------------------------
Douglas J. Neuman
/s/ Peter P. Rossi, Jr.
- - -----------------------------------------------
Peter P. Rossi, Jr.
/s/ Christopher J. Shaker
- - -----------------------------------------------
Christopher J. Shaker
/s/ Gary A. Clayman
- - -----------------------------------------------
Gary A. Clayman
/s/ Robert I. Griffith, Jr.
- - -----------------------------------------------
Robert I. Griffith, Jr.
