<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
SCHEDULE 13D
UNDER THE EXCHANGE ACT OF 1934
(Amendment No.____________)
AMTRUST CAPITAL CORP.
---------------------
(Name of Issuer)
COMMON STOCK, $.01 PAR VALUE
-------------------------------
(Title and Class of Securities)
03235B106
--------------
(CUSIP Number)
Richard J. Perry, Jr., Esquire
Perry & Associates, P.C.
1826 Jefferson Place, N.W.
Washington, D. C. 20036
(202) 775-8109
---------------------
(Name, Address and Telephone Number of Person Authorized to Receive
Notices and Communications)
April 26, 1996
------------------
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to report
the acquisition which is the subject of this Schedule 13D, and is filing this
schedule because of Rule 13d-1(b)(3) or (4), check the following box [ ].
Check the following box if a fee is being paid with the statement [ X ]. (A fee
is not required only if the reporting person: (1) has a previous statement on
file reporting beneficial ownership of more than five percent of the class of
securities described in Item 1; and (2) has filed no amendment subsequent
thereto reporting beneficial ownership of five percent or less of such class.)
(See Rule 13d-7.)
Exhibit Index at page 12
Page 1 of 25 Pages
<PAGE> 2
- -----------------------------------------------------------------------------
CUSIP NUMBER 03235B106 PAGE 2 OF 25 PAGES
------- -------
- -----------------------------------------------------------------------------
1. NAME OF REPORTING PERSON / S.S. OR I.R.S. IDENTIFICATION OF
ABOVE PERSON
Financial Institution Partners, L.P. / 52-1899611
- -----------------------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a)
(b)
- -----------------------------------------------------------------------------
3. SOURCE OF FUNDS
WC OO
- -----------------------------------------------------------------------------
4. IS DISCLOSURE OF LEGAL PROCEEDING REQUIRED PURSUANT TO ITEMS
2(d) AND 2(e)
NO
- -----------------------------------------------------------------------------
5. CITIZENSHIP OR PLACE OF ORIGIN
Organized: State of Delaware
- -----------------------------------------------------------------------------
NUMBER OF 6. SOLE VOTING POWER
SHARES
OWNED BY -----------------------------------------------------------------
EACH
REPORTING 7. SHARED VOTING POWER
PERSON WITH
28,500 SHARES
-----------------------------------------------------------------
8. SOLE DISPOSITIVE POWER
-----------------------------------------------------------------
9. SHARED DISPOSITIVE POWER
28,500 SHARES
- -----------------------------------------------------------------------------
10. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
28,500 SHARES
- -----------------------------------------------------------------------------
11. DOES THE AGGREGATE AMOUNT IN BOX 10 EXCLUDE CERTAIN SHARES?
NO
- -----------------------------------------------------------------------------
12. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (10)
6.11%
- -----------------------------------------------------------------------------
13. TYPE OF REPORTING PERSON
PN
- -----------------------------------------------------------------------------
Page 2 of 25 Pages
<PAGE> 3
- -----------------------------------------------------------------------------
CUSIP NUMBER 03235B106 PAGE 3 OF 25 PAGES
------- -------
- -----------------------------------------------------------------------------
1. NAME OF REPORTING PERSON / S.S. OR I.R.S. IDENTIFICATION OF
ABOVE PERSON
Hovde Capital, Inc. / 52-1891904
- -----------------------------------------------------------------------------
2.
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a)
(b)
- -----------------------------------------------------------------------------
3. SOURCE OF FUNDS
AF
- -----------------------------------------------------------------------------
4. IS DISCLOSURE OF LEGAL PROCEEDING REQUIRED PURSUANT TO ITEMS
2(d) AND 2(e)
NO
- -----------------------------------------------------------------------------
5. CITIZENSHIP OR PLACE OF ORIGIN
Incorporated: State of Delaware
- -----------------------------------------------------------------------------
NUMBER OF 6. SOLE VOTING POWER
SHARES
OWNED BY
EACH -----------------------------------------------------------------
REPORTING 7. SHARED VOTING POWER
PERSON WITH
28,500 SHARES
-----------------------------------------------------------------
8. SOLE DISPOSITIVE POWER
-----------------------------------------------------------------
9. SHARED DISPOSITIVE POWER
28,500 SHARES
- -----------------------------------------------------------------------------
10. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
28,500 SHARES
- -----------------------------------------------------------------------------
11. DOES THE AGGREGATE AMOUNT IN BOX 10 EXCLUDE CERTAIN SHARES?
NO
- -----------------------------------------------------------------------------
12.
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (10)
6.11%
- -----------------------------------------------------------------------------
13. TYPE OF REPORTING PERSON
CO
- -----------------------------------------------------------------------------
Page 3 of 25 Pages
<PAGE> 4
ITEM 1. SECURITY AND BANK
The class of security to which this statement relates is the common
stock, par value $0.01 per share (the "Shares"), of Amtrust Capital Corp. (the
"Company"). The address of the principal executive offices of the Company is 20
West Fifth Street, Peru, Indiana 46970.
ITEM 2. IDENTITY AND BACKGROUND
The persons filing this statement are Financial Institution Partners,
L.P. (the "Limited Partnership) and Hovde Capital, Inc. (the "General Partner").
The Limited Partnership is a Delaware limited partnership formed for the purpose
of investing in, among other things, the equity securities of various financial
institutions. Hovde Capital, Inc., a Delaware corporation, is the general
partner of Financial Institution Partners, L.P.
Attached as Schedule 1 hereto and incorporated by reference herein is a
list containing the principal business and the address of its principal business
and office for the Limited Partnership and the General Partner, as well as
information required by (a) through (f) of this Item as to each executive
officer, director and/or controlling person of the General Partner who are
Reporting Persons. The General Partner controls the Limited Partnership.
None of the Reporting Persons or executive officers, directors or
controlling persons of the General Partner have, during the last five years,
been convicted in a criminal proceeding (excluding traffic violations or similar
misdemeanors) or been a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction and as a result of such proceeding
was or is subject to a judgment, decree or final order enjoining future
violations of, or prohibiting or mandating activities subject to, federal or
state securities laws or finding of any violation with respect to such laws.
The Reporting Persons do not believe that they constitute a "group"
within the meaning of Section 13(d)(3) of the Securities Exchange Act of 1934,
as amended. Nevertheless, the Reporting Persons are making this filing because
of the possibility that they may be deemed a group, although each of the
Reporting Persons disclaims any membership in, and the existence of, such a
group. Neither the making of this filing nor any statement contained herein
shall be deemed to be an admission by any of the Reporting Persons that a group
exists.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
Information regarding the source and amount of funds used by the
Reporting Persons in acquiring beneficial ownership of their Shares is set forth
in Schedule 2 attached hereto and incorporated herein by reference.
Page 4 of 25 Pages
<PAGE> 5
ITEM 4. PURPOSE OF TRANSACTION
The Reporting Persons have acquired the Shares for investment purposes
and as set forth below:
(a) Each of the Reporting Persons may independently acquire additional
Shares or dispose of some or all of its Shares.
(b) None.
(c) None.
(d) None.
(e) None.
(f) None.
(g) None.
(h) None.
(i) None.
(j) None.
ITEM 5. INTEREST IN SECURITIES OF THE COMPANY
(a), (b) Schedule 3 hereto, which is incorporated by reference herein,
sets forth, as of December 18, 1998, information relating to the aggregate
number of Shares of the Company and the percentage of the outstanding Shares of
the Company as of such date (based upon information provided by the Company,
there are 466,662 Shares outstanding as of that date) as to each of the
Reporting Persons. With respect to the Shares set forth on Schedule 3, by virtue
of its control over the Limited Partnership, all decisions regarding voting and
disposition of the Shares beneficially owned by the Limited Partnership is made
by the General Partner acting through its chief executive officer or president.
As such, the Limited Partnership and the General Partner share voting and
investment power with respect to those Shares. Neither the General Partner, the
executive officers, directors or controlling persons beneficially owns any
Shares personally or otherwise, except for the Shares owned by the Partnership.
(c) The Reporting Persons have not effected any transactions in the
Shares within sixty (60) days of December 18, 1998. Furthermore, the Reporting
Persons did not effect any transactions in the Shares within sixty (60) days of
April 26, 1996. The Reporting Persons' last purchase on August 2, 1995 did not
cause the Reporting Persons to beneficially own more than five percent of the
Shares. However, since the date of the last purchase, the Reporting Persons
were unaware that the total amount of outstanding Shares of the Company had
decreased, thereby causing the Reporting Persons to beneficially own more than
five percent of the Shares.
Page 5 of 25 Pages
<PAGE> 6
(d) None.
(e) Not applicable.
Each of the Reporting Persons disclaims beneficial ownership of Shares
beneficially owned by any of the other Reporting Persons.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO
SECURITIES OF THE COMPANY
None.
ITEM 7. MATERIALS TO BE FILED AS EXHIBITS
Exhibit A - Consent Agreement pursuant to 17 C.F.R.Sections 13d-1(f)(1)
Exhibit B- [OMITTED - - FILED PURSUANT TO REQUEST FOR CONFIDENTIAL
TREATMENT]
Exhibit C - Customer Agreement between NationsBanc Montgomery Securities and
Financial Institution Partners, L.P.
Exhibit D - Prime Broker Agreement between NationsBanc Montgomery Securities
and Financial Institution Partners, L.P.
Exhibit E - Partnership Agreement between NationsBanc Montgomery Securities
and Financial Institution Partners, L.P.
Page 6 of 25 Pages
<PAGE> 7
SIGNATURES
After reasonable inquiry and to the best of his/its knowledge and belief,
each of the undersigned Reporting Persons certifies that the information set
forth in this statement with respect to him/it is true, complete and correct.
FINANCIAL INSTITUTION PARTNERS, L.P., by
its General Partner, HOVDE CAPITAL, INC.
By: /s/ Eric D. Hovde
-----------------------------------
Eric D. Hovde
Its: President
HOVDE CAPITAL, INC.
By: /s/ Eric D. Hovde
-----------------------------------
Eric D. Hovde
Its: President
Dated: 12/18/98
----------
Page 7 of 25 Pages
<PAGE> 8
SCHEDULE 1
INFORMATION RELATING TO REPORTING PERSONS
<TABLE>
<CAPTION>
PRINCIPAL BUSINESS AND
ADDRESS OF PRINCIPAL BUSINESS
NAME OR PRINCIPAL OFFICE
---- ----------------------------
<S> <C>
Financial Institution Partners, L.P. Limited partnership formed to make
investments primarily in equity
securities of financial
institutions.
1629 Colonial Parkway
Inverness, Illinois 60067
Organized: State of Delaware
Hovde Capital, Inc. Corporation formed to serve as the
general partner of Financial
Institution Partners, L.P.
1629 Colonial Parkway
Inverness, Illinois 60067
Incorporated: State of Delaware
</TABLE>
Page 8 of 25 Pages
<PAGE> 9
INFORMATION RELATING TO EXECUTIVE OFFICERS, DIRECTORS
AND/OR CONTROLLING PERSONS
<TABLE>
<CAPTION>
NAME PRINCIPAL OCCUPATION
ADDRESS BUSINESS ADDRESS CITIZENSHIP
- ------- ---------------- -----------
<S> <C> <C>
Steven D. Hovde(1) Investment banker U.S.
1629 Colonial Parkway Hovde Financial, Inc.
Inverness, Illinois 60067 1629 Colonial Parkway
Inverness, Illinois 60067
Investment banking firm
Eric D. Hovde(2) Investment banker U.S.
1826 Jefferson Place, NW Hovde Financial, Inc.
Washington, D.C. 20036 1826 Jefferson Place, NW
Washington, D.C. 20036
Investment banking firm
Braddock J. LaGrua(3) Investment banker U.S.
1826 Jefferson Place, NW Hovde Financial, Inc.
Washington, D.C. 20036 1826 Jefferson Place, NW
Washington, D.C. 20036
Investment banking firm
</TABLE>
- --------
(1) Steven D. Hovde is affiliated with the following Reporting Persons:
Chairman, CEO of Hovde Capital, Inc.
(2) Eric D. Hovde is affiliated with the following Reporting Persons: President
of Hovde Capital, Inc.
(3) Braddock J. LaGrua is affiliated with the following Reporting Persons:
Executive VP, Treasurer of Hovde Capital, Inc.
Page 9 or 25 Pages
<PAGE> 10
SCHEDULE 2
The following table sets forth the amount and source of funds used by
each Reporting Person in acquiring the Shares beneficially owned by it.
<TABLE>
<CAPTION>
AMOUNT
ORIGINALLY
TOTAL FINANCED/ SOURCE OF
NAME CONSIDERATION CURRENT BALANCE FUNDS
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
Financial $245,812.50 $85,500.00/ Working Capital/
Institution $160,312.50 Line of Credit*
Partners, L.P.
Hovde Capital, $245,812.50 $85,500.00/ Working Capital/
Inc. $160,312.50 Line of Credit of
Affiliate*
</TABLE>
- -------
* $160,312.50 was financed through a line of credit with NationsBanc Montgomery
Securities at Federal Funds rate +5/8.
Page 10 or 25 Pages
<PAGE> 11
SCHEDULE 3
The following table sets forth the number and approximate percentage of
Shares beneficially owned by each of the Reporting Persons. Each of the
Reporting Persons has shared power to vote or to direct the vote and to dispose
or to direct the disposition of the Shares of which each of them, respectively,
possesses beneficial ownership.
<TABLE>
<CAPTION>
APPROXIMATE
NAME NUMBER OF SHARES PERCENTAGE
- ---- ---------------- ----------
<S> <C> <C>
Financial Institution 28,500 6.11%
Partners, L.P.
Hovde Capital, Inc. 28,500 6.11%
- ----------------------------------------------------------------------
Aggregate Shares Held by 28,500 6.11%
Reporting Persons
</TABLE>
Page 11 of 25 Pages
<PAGE> 12
EXHIBIT INDEX
<TABLE>
<CAPTION>
Page
<S> <C> <C>
Exhibit A - Consent Agreement to 17 C.F.R. Section 13d-1(f)(1) 13
Exhibit B - [OMITTED - - FILED PURSUANT TO REQUEST 15(4)
FOR CONFIDENTIAL TREATMENT]
Exhibit C - Customer Agreement between NationsBanc 16
Montgomery Securities and Financial Institution
Partners, L.P.
Exhibit D - Prime Broker Agreement between NationsBanc 20
Montgomery Securities and Financial Institution
Partners, L.P.
Exhibit E - Partnership Agreement between NationsBanc 24
Montgomery Securities and Financial Institution
Partners, L.P.
</TABLE>
- --------
(4) Portions of Exhibit B have been omitted pursuant to a request for
confidential treatment of information in accordance with Rule 24b-2 of the
SecuritiesExchange Act of 1934.
Page 12 of 25 Pages
<PAGE> 13
EXHIBIT A
Consent Agreement Pursuant to 17 C.F.R. Section 13d-1(f)(1)
Each of the undersigned hereby consents and agrees to the filing on
behalf of each of them of the foregoing joint statement on Schedule 13D pursuant
to 17 C.F.R. 13d-1(f)(1) with respect to his/its beneficial ownership of the
shares of the Issuer.
FINANCIAL INSTITUTION PARTNERS, L.P., by its
General Partner, HOVDE CAPITAL, INC.
By: /s/ Eric D. Hovde
--------------------------------
Eric D. Hovde
Its: President
HOVDE CAPITAL, INC.
By: /s/ Eric D. Hovde
--------------------------------
Eric D. Hovde
Its: President
Page 13 of 25 Pages
<PAGE> 14
BRACKETS USED TO DENOTE LOCATION OF PORTIONS
OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT
Page 14 of 25 Pages
<PAGE> 15
EXHIBIT B
[OMITTED]
Page 15 of 25 Pages
<PAGE> 16
EXHIBIT C
CUSTOMER AGREEMENT
This agreement sets forth the terms and conditions pursuant to which we,
NationsBanc Montgomery Securities LLC, and our successors and assigns, will
maintain your account for purchases and sales of "securities and other
property," which means, but is not limited to securities, financial instruments,
commodities and money of every kind and nature and related contracts and
options. This definition includes securities or other property currently or
hereafter held, carried or maintained by, or in the possession or control of, us
or any of our related entities for any purpose in and for any account now or
hereafter opened by you. You understand that, if your account is a cash account,
the provisions of paragraphs 18 & 19 are not binding upon you unless you enter
into a margin transaction and, if your account is a commodities account, the
provisions of paragraph 14 shall not be applicable.
1. APPLICABLE LAW AND REGULATIONS. All transactions in your account shall be
subject to all applicable laws and the rules and regulations of all federal,
state and self-regulatory agencies, including, but not limited to, the Board
of Governors of the Federal Reserve System and the constitution, rules,
customs and usages of the exchange or market (and its clearing house) where
the transactions are executed.
2. SECURITY INTEREST AND LIEN. All securities or other property which we may
at any time be carrying or maintaining for you or which may at any time be
in our possession or control for any purpose, including safekeeping, shall
be subject to a general lien for the discharge of all of your obligations to
us, irrespective of whether or not we have made advances in connection with
such securities or other property, and irrespective of the number of
accounts you may have with us.
3. DEPOSITS ON CASH TRANSACTIONS. If at any time NationsBanc Montgomery
Securities LLC considers it necessary for its protection, it may in its
discretion require you to deposit cash or collateral in your account to
assure due performance by you of your open contractual commitments.
4. BREACH OR DEFAULT. In the event of any breach by you of any agreement with
us, or any default by you in any obligation to us, or should you die or
file a petition in bankruptcy or for the appointment of a receiver by or
against you, or should we for any reason whatsoever deem it necessary for
our protection, we are hereby authorized, at our discretion, to sell any or
all of the securities and other property in any of your accounts which may
be in our possession or control, or which we may be carrying or maintaining
for you (either individually or jointly with others), or to buy-in any
securities or other property of which your account or accounts may be short,
or to cancel any other standing orders, to close out your account or
accounts in whole or in part or in order to close out any commitment made on
your behalf. Any such sale, purchase or cancellation may be made according
to our judgment and may be made, at our discretion, on the exchange or other
market where such business is then usually transacted, or at public auction
or at private sale, without advertising the same and without notice to you
or to your personal representative, and without prior tender, demand or call
of any kind upon you, or upon your personal representative (each of which is
expressly waived by you), and we may purchase the whole or any part thereof
free from any right of redemption, and you shall remain liable for any
deficiency; it being understood that a prior tender, demand, call or notice
of any kind shall not be considered a waiver of our right to sell or buy any
securities and/or other property held by us, or owed us by you, at any time
as hereinbefore provided. Nothing in this agreement shall be construed as
relieving you of any obligations imposed by law.
5. FINALITY OF REPORTS. Reports of execution of orders and statements of your
accounts shall become conclusive if not objected to in writing, the former
within five days, and the latter within ten days, after forwarding by us to
you by mail or otherwise.
6. RECEIPT OF TRUTH-IN-LENDING. You hereby acknowledge receipt and review of
NationsBanc Montgomery Securities LLC's Truth-In-Lending disclosure
statement contained here within. You understand that interest will be
charged on any debit balances in accordance with the methods described in
that statement or in any amendment or revision thereto which may be provided
to you. It is understood and agreed that the interest charge made to your
account at the close of one charge period will be compounded, unless paid;
that is, the unpaid interest charge for previous periods will be added to
the opening balance for the next charge period, thereby becoming part of the
principal amount due and bearing like interest.
7. TRANSFERS BETWEEN ACCOUNTS. At any time and from time to time, at our
discretion, we may without notice to you apply and/or transfer any or all
securities and/or other property of yours interchangeably between any of
your accounts.
Page 16 of 25 Pages
<PAGE> 17
8. SELL ORDERS. It is understood and agreed that you will designate any sell
order for a short account which you place with us as a "short sale" and
hereby authorize us to mark such order as being "short," and when placing
with us any order for a long account, will designate it as such and hereby
authorize us to mark such order as being "long." Any sell order which you
shall designate as being for long account as above provided is for
securities then owned by you and, if such securities are not then
deliverable by us from any of your accounts, the placing of such order shall
constitute a representation by you that it is impracticable for you to then
deliver such securities to us but that you will deliver them as soon as it
is possible for you to do so without undue inconvenience or expense.
9. AGE, BENEFICIAL INTEREST. If you are an individual, you represent that
you are of full legal age, and, in any event not less than eighteen years of
age. You further represent that no one except you has an interest in your
account with us.
10. OPERATIONAL MATTERS. NationsBanc Montgomery Securities LLC primarily uses
banks located in California and New York to issue checks. Also, when we
hold securities for your account, dividends and interest are credited on or
about the payable date as received. Most of our customers prefer to have
these funds held in their accounts, and this will be the procedure which we
will follow with your account unless you advise us of an alternative
procedure which you would prefer. For example, we could arrange for checks
to be sent to you monthly. If you require special arrangements, please bring
the matter to our attention. NationsBanc Montgomery Securities LLC's policy
is not to receive remuneration for directing orders to particular brokers/
dealers or market centers for execution. Notwithstanding this policy, should
NationsBanc Montgomery Securities LLC receive such remuneration on any
transaction, appropriate disclosure will be made.
11. CREDIT REPORT. NationsBanc Montgomery Securities LLC may, in its
discretion, request an investigative consumer report on you as a credit
reference, which report may include information with respect to character,
general reputation, personal characteristics and mode of living. In
accordance with the Fair Credit Reporting Act, a copy of any such report, if
obtained, will be made available to you upon written request.
12. CLEARANCE ACCOUNTS. If NationsBanc Montgomery Securities LLC carries
your account as clearing broker by arrangement with another broker through
whose courtesy your account has been introduced, then unless NationsBanc
Montgomery Securities LLC receives from you a written notice to the
contrary, NationsBanc Montgomery Securities LLC shall accept from such other
broker, without any inquiry or investigation by us, (i) orders for the
purchase and sale of securities and other property on margin or otherwise,
and (ii) any other instructions concerning said account. You understand
NationsBanc Montgomery Securities LLC shall have no responsibility or
liability to you for any acts or omissions of such other broker, its
officers, employees or agents.
13. WAIVER, ASSIGNMENT AND NOTICES. No term or provision of this Agreement
may be waived or modified unless in writing and signed by the party against
whom such waiver or modification is sought to be enforced. NationsBanc
Montgomery Securities LLC's failure to insist at any time upon strict
compliance with this Agreement or with any of the terms hereunder or any
continued course of such conduct on its part shall in no event constitute or
be considered a waiver by NationsBanc Montgomery Securities LLC of any of
its rights or privileges. This Agreement contains the entire understanding
between you and NationsBanc Montgomery Securities LLC concerning the subject
matter of this Agreement. You may not assign your rights or obligations
hereunder without first obtaining the prior written consent of NationsBanc
Montgomery Securities LLC. Notice or other communications, including margin
calls, delivered or mailed to the address given below shall, until
NationsBanc Montgomery Securities LLC has received notice in writing of a
different address, be deemed to have been personally delivered to you.
14. ARBITRATION.
- - ARBITRATION IS FINAL AND BINDING ON THE PARTIES.
- - THE PARTIES ARE WAIVING THEIR RIGHT TO SEEK REMEDIES IN COURT,
INCLUDING THE RIGHT TO JURY TRIAL.
- - PRE-ARBITRATION DISCOVERY IS GENERALLY MORE LIMITED THAN AND
DIFFERENT FROM COURT PROCEEDINGS.
- - THE ARBITRATORS' AWARD IS NOT REQUIRED TO INCLUDE FACTUAL FINDINGS
OR LEGAL REASONING AND ANY PARTY'S RIGHT TO APPEAL OR TO SEEK
MODIFICATION OF RULINGS BY THE ARBITRATORS IS STRICTLY LIMITED.
Page 17 of 25 Pages
<PAGE> 18
- - THE PANEL OF ARBITRATORS WILL TYPICALLY INCLUDE A MINORITY OF
ARBITRATORS WHO WERE OR ARE AFFILIATED WITH THE SECURITIES INDUSTRY.
YOU AGREE, AND BY CARRYING AN ACCOUNT FOR YOU, WE AGREE, THAT ALL CONTROVERSIES
WHICH MAY ARISE BETWEEN US CONCERNING ANY TRANSACTION OR THE CONSTRUCTION,
PERFORMANCE OR BREACH OF THIS OR ANY OTHER AGREEMENT BETWEEN US, WHETHER ENTERED
INTO PRIOR, ON, OR SUBSEQUENT TO THE DATE HEREOF, SHALL BE DETERMINED BY
ARBITRATION. ANY ARBITRATION UNDER THIS AGREEMENT SHALL BE CONDUCTED ONLY IN THE
FORUMS PROVIDED BY THE NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC. OR THE
BOARD OF GOVERNORS OF THE NEW YORK STOCK EXCHANGE, INC., AS YOU MAY ELECT. IF
YOU DO NOT MAKE SUCH ELECTION BY REGISTERED MAIL ADDRESSED TO NATIONSBANC
MONTGOMERY SECURITIES LLC, 600 MONTGOMERY STREET, SAN FRANCISCO, CA 94111,
ATTENTION: LEGAL DEPARTMENT, AND RECEIVED WITHIN FIVE DAYS AFTER DEMAND BY US
THAT YOU MAKE SUCH ELECTION, THEN NATIONSBANC MONTGOMERY SECURITIES LLC MAY MAKE
SUCH ELECTION. THE AWARD OF THE ARBITRATORS, OR OF THE MAJORITY OF THEM, SHALL
BE FINAL, AND JUDGMENT UPON ANY AWARD RENDERED BY THE ARBITRATORS MAY BE ENTERED
IN ANY COURT HAVING JURISDICTION THEREOF.
No person shall bring a putative or certified class action to arbitration, nor
seek to enforce any pre-dispute arbitration agreement against any person who has
initiated in court a putative class action or who is a member of a putative
class who has not opted out of the class with respect to any claims encompassed
by the putative class action until:
(i) the class certification is denied;
(ii) the class is decertified; or
(iii) the customer is excluded from the class by the court.
Such forbearance to enforce an agreement to arbitrate shall not constitute a
waiver of any rights under this agreement except to the extent stated herein.
15. NEW YORK LAW TO GOVERN. This Agreement and its enforcement shall be
governed by the laws of the State of New York (without regard to any
principles of conflicts of law) and its provisions shall be continuous;
shall cover individually and collectively all accounts which you may open or
reopen with us, and shall inure to the benefit of our present organization,
and any successor organization, irrespective of any change or changes at any
time in the personnel thereof, for any cause whatsoever, and of the assigns
of our present organization or any successor organization, and shall be
binding upon you, and/or your estate, executors, administrators, heirs and
assigns.
16. PARTIAL UNENFORCEABILITY. If any provision herein is or should become
inconsistent with any present or future law, rule or regulation of any
sovereign government or a regulatory body having jurisdiction over the
subject matter of this Agreement or is held to be invalid, void or
unenforceable by reason of any law, rule, administrative order or judicial
decision, such provision shall be deemed to be rescinded or modified in
accordance with any such law, rule, regulation, order or decision. In all
other respects, this Agreement shall continue and remain in full force and
effect.
17. LIMIT ORDERS. NationsBanc Montgomery Securities LLC reserves the right
to not accept from customers limit orders in NASDAQ or over-the-counter
securities in which it acts as a market maker.
18. MARGIN IN MARGIN ACCOUNTS (NOT APPLICABLE TO CASH ACCOUNTS). You hereby
agree to maintain such margin in your margin account as NationsBanc
Montgomery Securities LLC may in its discretion require and you agree to pay
forthwith on demand any debit balance owing with respect to any of your
margin accounts, and if not paid this shall be a breach of this Agreement
and NationsBanc Montgomery Securities LLC may take such action as it
considers necessary for its protection in accordance with this Agreement.
You understand that, even if NationsBanc Montgomery Securities LLC has a
policy of giving customers notice of a margin deficiency, NationsBanc
Montgomery Securities LLC is not obligated to request additional margin from
you, and there may be circumstances where NationsBanc Montgomery Securities
LLC will liquidate securities and/or other property in your account without
notice to you. You will be charged interest on your debit balance which if
not paid at the close of an interest period will be added to the opening
balance for the next interest period. Please consult the attached disclosure
statement for an outline of NationsBanc Montgomery Securities LLC's interest
policies.
Page 18 of 25 Pages
<PAGE> 19
CASH/MARGIN
19. CUSTOMER'S CONSENT TO LOAN OR PLEDGE OF SECURITIES AND OTHER PROPERTY
(NOT APPLICABLE TO CASH ACCOUNTS). You hereby authorize NationsBanc
Montgomery Securities LLC to lend either to itself or to others any
securities and other property held by NationsBanc Montgomery Securities LLC
in your margin account and to carry all such property in its general loans
and such property may be pledged, repledged, hypothecated or rehypothecated,
without notice to you, either separately or in common with other such
property for any amounts due to NationsBanc Montgomery Securities LLC
thereon or for a greater sum, and NationsBanc Montgomery Securities LLC
shall have no obligation to retain a like amount of similar property in its
possession and control.
BY SIGNING THIS AGREEMENT YOU ACKNOWLEDGE THAT THE SECURITIES IN YOUR MARGIN
ACCOUNT MAY BE LOANED TO NATIONSBANC MONTGOMERY SECURITIES LLC OR LOANED OUT TO
OTHERS AND THAT YOU HAVE RECEIVED AND REVIEWED A COPY OF THIS AGREEMENT.
THIS AGREEMENT CONTAINS A PRE-DISPUTE ARBITRATION CLAUSE AT PAGES 2-3 AT
PARAGRAPH 14.
IF JOINT ACCOUNT BOTH PARTIES MUST SIGN. PERSONS SIGNING ON BEHALF OF OTHERS
PLEASE INDICATE TITLE OR CAPACITY IN WHICH YOU HAVE SIGNED.
Financial Institution Partners, L.P.
- -----------------------------------------------------
(TYPED OR PRINTED NAME)
By: Hovde Capital, Inc., general partner
By: Richard J. Perry, Jr., Secretary
- -----------------------------------------------------
(SIGNATURE)
/s/ Richard J. Perry, Jr.
- -----------------------------------------------------
(SIGNATURE)
1824 Jefferson Place, N.W.
- -----------------------------------------------------
(MAILING ADDRESS)
Washington DC 20036
- -----------------------------------------------------
(CITY) (STATE) (ZIP)
2/4/98
- -----------------------------------------------------
(DATE)
Acct.
No:
-------------------------------------------------
<PAGE> 20
EXHIBIT D
NationsBanc Montgomery Securities LLC
PRIME BROKER AGREEMENT
In accordance with the requirements set forth in the January 25, 1994 No-Action
Letter of the Division of Market Regulation of the Securities and Exchange
Commission (the "No-Action Letter"), NationsBanc Montgomery Securities LLC
("NMS"), a North Carolina corporation, and each Customer on whose behalf this
agreement has been executed ("Customer"), hereby agree as follows.
1. As of October 3, 1994 or such later date when the No-Action Letter shall
become effective, this Agreement shall apply to all transactions in which
NMS is given up as the prime broker for Customer; i.e. transactions executed
for Customer by one or more executing brokers (each, an "Executing Broker"),
which transactions are submitted to NMS for clearance and settlement.
2. If Customer is the beneficial owner of an account managed by an Investment
Advisor registered with the Securities and Exchange Commission under the
Investment Advisors Act of 1940 or such other authorized agent,
attorney-in-fact or third party ("Investment Advisor"), then this Agreement
has been executed on Customer's behalf by such Investment Advisor. Each
Customer on whose behalf this Agreement has been executed is named on
Schedule A hereto, as such Schedule may be modified from time to time.
Investment Advisor represents and warrants that it has on file written
authorization to execute agreements on behalf of each Customer named on
Schedule A and shall indemnify and hold NMS harmless from any claim or
claims arising from Investment Advisor's unauthorized execution of this
Agreement on any such Customer's behalf.
3. All Executing Brokers through whom Customer or Investment Advisor, as the
case may be, is initially authorized to execute prime brokerage transactions
are identified on Schedule B hereto. Prior to entering into a prime
brokerage transaction with an Executing Broker not identified on Schedule B.
Customer or Investment Advisor shall state in a writing sent via facsimile
to NMS that it desires to do so and confirm with NMS that a prime brokerage
agreement has been executed between NMS and such Executing Broker. Upon
execution of a prime brokerage agreement between NMS and such Executing
Broker, Schedule B hereto shall be deemed automatically amended to include
such Executing Broker and, only thereafter, may Customer execute prime
brokerage transactions with such Executing Broker pursuant to this
Agreement.
4. Customer or Investment Advisor, as the case may be, will promptly notify
NMS of each transaction executed by an Executing Broker on Customer's
behalf, no later than the close of business on trade date. At a minimum,
such notice will include the security involved, the number of shares or
units, the price per share or unit, whether the transaction was a long or
short sale or a purchase, the Executing Broker and the Executing Broker's
commission.
Page 20 of 25 Pages
<PAGE> 21
5. On the next business day following trade date, NMS will send to Customer,
or if requested in writing, to Investment Advisor, notification confirming
the details of each transaction executed by Executing Broker on Customer's
behalf, based upon the information provided to NMS by Customer or Investment
Advisor. Such notification will include all information required for a
confirmation pursuant to Rule 10b-10 under the Securities Exchange Act of
1934 ("Rule 10b-10"), except the capacity of the executing broker, an
average price designation, and, in principal trades, the reported trade
price and the difference between that price and the net price to Customer,
if this information has not been provided to NMS by Customer or Investment
Advisor. In addition, the notification will disclose any transaction-based
charges imposed by NMS and any commission charged by Executing Broker.
6. NMS will settle transactions on Customer's behalf, unless, during the time
permitted for disaffirmations under the agreement then in effect between
NMS and Executing Broker, NMS disaffirms all unsettled transactions of
Customer that NMS determines to disaffirm in good faith and in accordance
with reasonable commercial standards. NMS will promptly send to Customer or
Investment Advisor, as applicable, a notice of cancellation of all
disaffirmed transactions to offset any notifications sent previously. NMS
shall not be responsible for the clearance and settlement of transactions
that it disaffirms. Rather, Customer shall be responsible and liable solely
to Executing Broker(s) for the clearance and settlement of such
transactions.
7. Without limiting the generality of the foregoing, if Customer is the
beneficial owner of an account managed by an Investment Advisor registered
under the Investment Advisor's Act of 1940, NMS, in its sole and absolute
discretion, may elect not to settle prime brokerage transactions on behalf
of Customer if Customer fails to maintain in its account with NMS minimum
net equity of at least $250,000 in cash or securities with a ready market as
defined in Rule 15c3-l(c)(11) under the Securities Exchange Act of 1934.
Otherwise, if Customer is not the beneficial owner of an account managed by
an Investment Advisor registered under the Investment Advisor's Act of 1940,
NMS, in its sole and absolute discretion, may elect not to settle prime
brokerage transactions on behalf of Customer if Customer fails to maintain
in its account with NMS minimum net equity of at least $1,000,000 in cash or
securities with a ready market as defined in Rule 15c3-l(c)(11) under the
Securities Exchange Act of 1934.
8. Furthermore, in the event net equity in Customer's account with NMS falls
below the minimum amount set forth in the No-Action Letter, Customer shall
have until 12:00 noon of the fifth business day following the date on which
net equity fell below the minimum amount to restore net equity to the level
required in the No-Action Letter. If Customer fails to restore net equity to
the required level, NMS shall notify each Executing Broker, by the same
day's close of business, that NMS is no longer acting as Prime Broker for
Customer. As of the day following such notice, NMS may not accept any prime
brokerage transactions commenced on behalf of Customer.
Page 21 of 25 Pages
<PAGE> 22
9. So long as this Agreement is in effect, NMS will be responsible to ensure
that all transactions which it has affirmed and not subsequently
disaffirmed, and is obligated to clear, are cleared between NMS and
Customer, and accordingly, appear on NMS's books in either a cash or margin
account for Customer and conform to Regulation T promulgated by the Board of
Governors of the Federal Reserve System and applicable self-regulatory
organization margin requirements.
10. Customer may instruct, in a writing separate from the prime brokerage
agreement between Customer and Executing Broker, Executing Broker to send
confirmations of transactions, as required by Rule l0b-10, to Customer in
care of NMS. Confirmations received by NMS on Customer's behalf are
available to Customer without charge, promptly upon request. The parties
acknowledge that providing such an instruction is not a condition to
entering into this Agreement, nor shall Customer be charged differential
fees or otherwise receive incentives for providing such an instruction.
11. NMS is hereby authorized to disclose Customer's name and address to each
Executing Broker identified on Schedule B as such Schedule may be modified
from time to time, to enable such Executing Broker to establish on its books
an account for Customer to be used in the event transactions are disaffirmed
by NMS.
12. NMS will issue to Customer a statement of account at least on a quarterly
basis. The statement will include all transactions that occurred during
the statement period and the resultant security positions and money
balances.
13. Customer represents and warrants that it is currently in compliance, and
during the term of this Agreement will remain in compliance, with all
applicable requirements of the No-Action Letter, and any supplements or
amendments thereto; including, in particular, the requirement that it
execute an agreement similar to this Agreement with each Executing Broker at
any point in time identified on Schedule B.
14. In the event of an inconsistency between any term or terms of this Agreement
and those of any Cash Account Agreement, Margin Agreement or Clearing
Agreement between the parties, this Agreement shall control to the extent
of such inconsistency.
15. This Agreement may be amended or modified only by NMS upon prior written
notice to Investment Advisor or Customer. Such amendment or modification
shall become effective immediately in the event Customer continues to accept
prime brokerage services from NMS after the date on which such notice is
given.
16. This Agreement may be terminated by either party hereto upon prior written
notice. Any such termination shall not affect Customer's liabilities and
obligations to NMS with respect to transactions executed prior to such
termination.
17. This Agreement shall be governed by and construed in accordance with the
laws of the State of New York, without giving effect to the conflict of law
principles thereof.
Page 22 or 25 Pages
<PAGE> 23
18. (a) ARBITRATION IS FINAL AND BINDING ON THE PARTIES.
(b) THE PARTIES ARE WAIVING THEIR RIGHTS TO SEEK REMEDIES IN COURT,
INCLUDING THE RIGHT TO A JURY TRIAL.
(c) PRE-ARBITRATION DISCOVERY IS GENERALLY MORE LIMITED THAN AND
DIFFERENT FROM COURT PROCEEDINGS.
(d) THE ARBITRATORS' AWARD IS NOT REQUIRED TO INCLUDE FACTUAL FINDINGS OR
LEGAL REASONING AND ANY PARTY'S RIGHT TO APPEAL OR SEEK MODIFICATIONS
OR RULINGS BY THE ARBITRATORS IS STRICTLY LIMITED.
(e) THE PANEL OF ARBITRATORS WILL TYPICALLY INCLUDE A MINORITY OF
ARBITRATORS WHO WERE OR ARE AFFILIATED WITH THE SECURITIES INDUSTRY.
ANY CONTROVERSY BETWEEN NMS OR ANY OF ITS AFFILIATES OR ANY OF ITS OR THEIR
PARTNERS, OFFICERS, DIRECTORS OR EMPLOYEES ON THE ONE HAND, AND CUSTOMER AND/OR
INVESTMENT ADVISOR ON THE OTHER HAND, ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR THE ACCOUNTS ESTABLISHED HEREUNDER, SHALL BE SETTLED BY
ARBITRATION, IN ACCORDANCE WITH THE RULES THEN OBTAINING OF THE NEW YORK STOCK
EXCHANGE, INC. (OR SUCH OTHER ARBITRATION PANEL OR BOARD AS MAY BE REQUIRED BY
LAW). ANY AWARD OF THE ARBITRATORS SHALL BE FINAL, AND JUDGMENT UPON THE AWARD
RENDERED MAY BE ENTERED IN ANY COURT, STATE OR FEDERAL, HAVING JURISDICTION.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement, WHICH IS
ACKNOWLEDGED TO CONTAIN A PRE-DISPUTE ARBITRATION CLAUSE, to be duly executed
and delivered as of the date set forth below.
<TABLE>
<S> <C>
Financial Institution Partners, L.P.
- --------------------------------------------
CUSTOMER OR INVESTMENT ADVISOR ACCEPTED AND AGREED TO:
NATIONSBANC MONTGOMERY
By: HOVDE CAPITAL, INC., general partner SECURITIES LLC AS PRIME BROKER
By: /s/ Richard J. Perry, Jr. By: /s/ Glenn Dailey
----------------------------------------- ------------------------------------------
Richard J. Perry, Jr., Secretary Senior Managing Director
- -------------------------------------------- ---------------------------------------------
Print Name and Title Print Name and Title
Date: 2/4/98 Date: 2/5/98
--------------------------------------- ----------------------------------------
</TABLE>
Page 23 of 25 Pages
<PAGE> 24
EXHIBIT E
NationsBanc Montgomery Securities LLC
----------------------------
ACCOUNT NUMBER
----------------------------
ACCOUNT NAME
PARTNERSHIP AGREEMENT
Ladies and Gentlemen:
In consideration of your opening and carrying a partnership account in the name
of Financial Institution Partners, L.P. a duly organized partnership (the
"Partnership") of which each of the undersigned is a general partner, the
undersigned jointly and severally agree that each of the following persons, to
wit:
Eric D. Hovde Steven D. Hovde
- ------------------------------ ------------------------
Richard J. Perry, Jr. Braddock J. LaGrua
- ------------------------------ ------------------------
are hereby appointed the authorized agents and attorneys-in-fact of the
Partnership (the "Authorized Agents"), and shall have authority on behalf of the
Partnership, and for its account and risk, to buy, sell (including short sales),
tender, convert, exchange, trade and otherwise deal in, through you as brokers,
stocks, bonds, options and any other securities (on margin or otherwise) in
accordance with your terms and conditions for the Partnership account.
You are authorized to follow the instructions of the Authorized Agents in every
respect concerning said account, and to deliver to them on behalf of the
Partnership account all demands, notices, confirmations, reports, statements of
accounts, and communications of every kind; to deliver to them on behalf of the
Partnership account money, securities and property of every kind, and to follow
the orders of said Authorized Agents regarding the same. The Authorized Agents
are hereby authorized to execute and deliver on behalf of the Partnership
account agreements relating to any of the foregoing matters and to terminate or
modify same or waive any of the provisions thereof; and generally to deal with
you on behalf of the Partnership account as fully and completely as if each
alone were interested in said accounts, all without notice to the other or
others interested in said account.
This Authorization and indemnity is in addition to, and in no way limits or
restricts, any rights which you have under any other agreement or agreements
between you and the undersigned, or any of them, now existing or hereafter
entered into, and is binding on the Partnership and its legal representatives,
successors and assigns. This authorization and indemnity is also a continuing
one and shall remain in full force and effect until revoked by a written notice,
addressed to you and delivered to you at your principal office in San Francisco.
No such revocation shall affect any liability arising out of any transaction
initiated prior to such revocation. The undersigned, jointly and severally agree
to indemnify and hold you harmless from and to pay you promptly on demand any
debit balance in said account, including any loss or debit balance resulting
from transactions initiated prior to receipt of such revocation.
The undersigned hereby certify that the general and/or limited partners of said
Partnership are as follows: *
Name N/A Occupation
------------------------------ ----------------------------
Name Occupation
------------------------------ ----------------------------
Name Occupation
------------------------------ ----------------------------
*or attach signature page(s) of partnership
Page 24 of 25 Pages
<PAGE> 25
Name Occupation
------------------------------ ----------------------------
Name Occupation
------------------------------ ----------------------------
Name Occupation
------------------------------ ----------------------------
Name Occupation
------------------------------ ----------------------------
Name Occupation
------------------------------ ----------------------------
Name Occupation
------------------------------ ----------------------------
Name Occupation
------------------------------ ----------------------------
Name Occupation
------------------------------ ----------------------------
Name Occupation
------------------------------ ----------------------------
Name Occupation
------------------------------ ----------------------------
The undersigned further authorizes you, in the event of death or retirement of
any of the general and/or limited partners of said Partnership, to take such
proceedings, require such papers, retain such portions or restrict transactions
in said account as you may deem advisable to protect you against any liability,
penalty or loss under any present or future laws or otherwise. It is further
agreed that in the event of the death or retirement of any member of the said
Partnership the remaining members will immediately cause you to be notified of
such fact.
This Authorization and indemnity and its enforcement shall be governed by the
laws of the State of New York, shall cover individually and collectively all
accounts covered by this agreement and authorization which the undersigned may
open or reopen with you, and shall inure to the benefit of your present
organization, and any successor organization, irrespective of any change or
changes of any kind of the personnel thereof for any cause whatsoever, and of
the assigns of your present organization or any successor organization.
CUSTOMER CONSENT TO LOAN OR PLEDGE OF SECURITIES AND OTHER PROPERTY (NOT
APPLICABLE TO CASH ACCOUNTS): each of the undersigned has signed the enclosed
Customer's Agreement and Customer's Loan Consent which are intended to cover, in
addition to the provisions hereof, the terms upon which the Partnership is to be
carried.
Very truly yours,
HOVDE CAPITAL, INC.
Dated: 2/4/98 By: /s/ Richard J. Perry, Jr.
----------------------------- -------------------------------
General Partner(s)
-------------------------------
-------------------------------
Page 25 of 25 Pages
