<PAGE> 1
As filed with the Securities and Exchange Commission on July 10, 1998
Registration No. 333-56463
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------------------
PRE-EFFECTIVE AMENDMENT NO. 2
TO FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
---------------------------
OAK HILL FINANCIAL, INC.
(Exact name of Registrant as specified in its charter)
Ohio 6712 31-1010517
(State or other jurisdiction of (Primary Standard Industrial (I.R.S. Employer
incorporation or organization) Classification Code Number) Identification No.)
---------------------------
14621 State Route 93
Jackson, Ohio 45640
(740) 286-3283
(Address, including zip code, and telephone number, including
area code, of Registrant's principal executive offices)
---------------------------
John D. Kidd
President and Chief Executive Officer
Oak Hill Financial, Inc.
14621 State Route 93
Jackson, Ohio 45640
(740) 286-3283
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
---------------------------
Copies of Correspondence to:
H. Grant Stephenson, Esq. Terri R. Abare, Esq.
Porter, Wright, Morris & Arthur Vorys, Sater, Seymour and Pease LLP
41 South High Street 221 East Fourth Street
Columbus, Ohio 43215 Cincinnati, Ohio 45202
(614) 227-2155 (513)723-4000
---------------------------
Approximate date of commencement of proposed sale of the securities to the
public: As soon as practicable after the Effective Date of this Registration
Statement.
If the only securities being registered on this Form are being offered pursuant
to dividend or interest reinvestment plans, please check the following box. [ ]
If any securities being registered on this Form are to be 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. [ ]
If this Form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
----------
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, please check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
----------
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
II-1
<PAGE> 2
<TABLE>
CALCULATION OF REGISTRATION FEE
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------
Proposed Maximum Proposed Maximum Amount of
Title of Each Class of Amount to be Offering Price Aggregate Offering Registration
Securities to be Registered Registered Per Share* Price* Fee*
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common stock, without par value.......... 1,006,250 $22.50 $22,640,625 $6,679
- ----------------------------------------------------------------------------------------------------------------
</TABLE>
* Estimated solely for the purpose of calculating the registration fee pursuant
to Rule 457(c), based on the average high and low prices of the Common Stock as
reported on the Nasdaq National Market on June 5, 1998.
This Registration Statement shall be deemed to cover an indeterminate number of
additional shares of Oak Hill Financial, Inc. Common Stock, without par value,
as may be issuable pursuant to future stock dividends, stock splits or similar
transactions.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES
AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE
A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE
SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION ACTING PURSUANT
TO SECTION 8(a), MAY DETERMINE.
II-2
<PAGE> 3
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth the various expenses in connection with
the sale and distribution of the securities being registered hereby, other than
underwriting discounts and commissions, if any. All amounts shown are estimates,
except the SEC registration fee:
SEC registration fee..................................... $ 6,679
Printing and engraving fee............................... 15,000
Legal fees and expenses.................................. 20,000
Accounting fees and expenses............................. 5,000
Blue Sky fees and expenses............................... 5,000
Transfer agent and registrar fees and expenses........... 4,000
Miscellaneous fees and expenses.......................... 1,321
Total........................................... $57,000
-------
All the costs identified above will be paid by the Selling Shareholders.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
(a) Article VI of the Company's Regulations provides that the Company
shall indemnify any person who was or is a party or is threatened to be made a
party to any action (other than an action by or in the right of the Company) by
reason of the fact that the person was or is a director of the Company; or while
a director of the Company such person was or is serving at the request of the
Company as a director, officer, or in some other agency capacity for another
entity. The Company may indemnify any person who was or is a party or is
threatened to be made a party to any action (other than an action by or in the
right of the Company) by reason of the fact that the person was or is an
officer, employee or agent of the Company, or while an officer, employee or
agent of the Company was or is serving at the request of the Company as a
director, officer or in some other agency capacity for another entity.
Indemnification covers expenses (including attorney's fees), judgments, fines
and amounts paid in settlements if such an aforementioned person acted in good
faith and in a manner in which they reasonably believed to be in or not opposed
to the best interests of the Company; and, with respect to a criminal
proceeding, the person had no reasonable cause to believe that the conduct was
unlawful. The termination of an action by judgment, order, settlement or
conviction, or upon a plea of nolo contendere, shall not, by itself, create a
presumption about a person's state of mind.
The Company may indemnify any person who was or is a party or is
threatened to be made a party in an action by or in the right of the Company to
procure a judgment in its favor by reason of the fact that the person is a
director, officer, employee or agent, or is serving at the request of the
Company as a director, officer or in some other agency capacity for another
entity. In actions by the Company, indemnification covers expenses (including
attorney's fees) incurred by a person in connection with defense or settlement
of such action if they acted in good faith and in a manner reasonably believed
to be in or not opposed to the best interests of the Company. No indemnification
shall be made in respect of (1) any action as to which such person is adjudged
to be liable for negligence or misconduct in the performance of their duties,
unless and only to the extent the court in which such action was brought
determines upon application that such person is reasonably entitled to indemnity
for such expenses as the court shall deem proper; or (2) any action in which the
only liability asserted against a director is pursuant to Section 1701.95 of the
Ohio Revised Code dealing with liability for unlawful loans, dividends or
distributions.
Any indemnification shall be made by the Company only as authorized in
the specific case upon a determination that the indemnification was proper
because the person met the applicable standard of conduct set forth above. Such
determination shall be made (1) by the Board of Directors by a majority vote of
a quorum of disinterested directors; (2) in a written opinion by independent
counsel; (3) by the shareholders; or (4) by the court where the action was
brought. Any determination made by the disinterested directors or independent
counsel shall be properly communicated to the person who threatened or brought
the action by or in the right of the Company. Such person shall have the right,
within ten days after notification, to petition the court to review the
reasonableness of such determination. To the extent that a director or other
person in an agency capacity has been successful on the merits or in defense of
an action referred to above, that person shall be indemnified against expenses
(including attorney's fees) reasonably incurred in connection with the action;
this type of indemnification does not require an authorized determination by the
Company.
II-3
<PAGE> 4
Expenses (including attorney's fees) incurred by a director in
defending an action referred to above, except where the liability asserted
against a director is pursuant to Section 1701.95 of the Ohio Revised Code,
shall be paid by the Company as they are incurred in advance of the final
disposition of the action, if the director agrees to repay such amount if it is
proved that the director's action or failure to act was undertaken with
deliberate intent to cause injury to the Company or with reckless disregard for
the best interests of the Company. Expenses (including attorney's fees) incurred
by a director or other person in an agency capacity in defending an action
referred to above, including an action brought against a director pursuant to
Section 1701.95 of the Ohio Revised Code, may be paid by the Company as incurred
before final disposition of the action as authorized by the directors if such
person agrees to repay the Company if it is ultimately determined that the
person is not entitled to be indemnified.
The indemnification authorized by Article VI is not exclusive of, and
is in addition to, any other rights granted to those seeking indemnification
under the Company's regulations, common law and corporation law of the State of
Ohio, or vote of shareholders or disinterested directors. Indemnification rights
shall continue in the person who has ceased to be affiliated with the Company
and shall inure to such person's heirs, executors and administrators.
The Company may purchase insurance on behalf of any person who was or
is a director, officer, employee or agent of the Company, or was or is serving
at the request of the Company as director, officer or in some other agency
capacity for another entity, against liability that is asserted or incurred by
such person in any such capacity, whether or not the Company has the power to
indemnify such person against liability under the provisions of Article VI.
Under Section 1701.13 of the Ohio General Corporation Law, a corporation may
purchase and maintain insurance on behalf of any person who is or was a
director, officer, employee, or agent of the corporation, or who, while serving
in such capacity, is or was at the request of the corporation, a director,
officer, employee or agent of another corporation or legal entity or of an
employee benefit plan, against liability asserted against or incurred by such
person in any such capacity whether or not the corporation would have the power
to provide indemnity under Section 1701.13 of the Ohio General Corporation Law.
The above discussion of the Company's Regulations and of Section
1701.13 of the Ohio General Corporation Law is not intended to be exhaustive and
is respectively qualified in its entirety by such Regulations and statute.
ITEM 16. EXHIBITS.
EXHIBIT EXHIBIT
NUMBER DESCRIPTION
------ -----------
1 Underwriting Agreement among the Selling Shareholders,
McDonald & Company Securities, Inc., and Advest, Inc. (Filed
herewith)
*2(a) Agreement and Plan of Merger, dated April 28, 1997, between
Oak Hill Banks and Unity Savings Bank (reference is made to
Exhibit 2(a) of the Registrant's 8-K, filed on October 14,
1997, and incorporated herein by reference).
*2(b) Supplemental Agreement, dated April 28, 1997, among Oak Hill
Financial, Inc., Oak Hill Banks, and Unity Savings Bank
(reference is made to Exhibit 2(b) of the Registrant's 8-K
filed on October 14, 1997, and incorporated herein by
reference).
*3(a) Second Amended and Restated Articles of Incorporation
(reference is made to Form SB-2, Exhibit 3(i), File No.
33-096216 and incorporated herein by reference).
*3(b) Restated Code of Regulations (reference is made to Form SB-2,
Exhibit 3(ii), File No. 33-96216 and incorporated herein by
reference).
*4(a) Reference is made to Articles FOURTH, FIFTH, SEVENTH, EIGHTH,
TENTH AND ELEVENTH of the Registrant's Restated Articles of
Incorporation (contained in the Registrant's Restated Articles
of Incorporation filed as Exhibit 3(a) hereto) and Articles
II, III, IV, VI and VIII of the Registrant's Amended and
Restated Code of Regulations (contained in the Registrant's
Amended and Restated Code of Regulations filed as Exhibit 3(b)
hereto).
*4(b) Rights Plan, dated January 23, 1998, between Oak Hill
Financial, Inc., and Fifth Third Bank, (reference is made to
Exhibit 4.1 to the Form 8-A, filed with the Securities and
Exchange Commission on January 23, 1998 and incorporated
herein by reference).
5 Opinion of Porter, Wright, Morris & Arthur regarding legality.
(Previously filed)
*23(a) Consent of Porter, Wright, Morris & Arthur (included in
Exhibit 5)
II-4
<PAGE> 5
23(b) Consent of Grant Thornton LLP. (Previously filed)
24 Powers of Attorney. (Previously filed)
- -----------------------------------------------
*Incorporated by reference as indicated
ITEM 17. UNDERTAKINGS.
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: (i) to include any prospectus required by section
10(a)(3) of the Securities Act of 1933; (ii) to reflect in the prospectus any
facts or events arising after the effective date of the registration statement
(or the most recent post-effective amendment thereof) which, individually or in
the aggregate, represent a fundamental change in the information set forth in
the registration statement. Notwithstanding the foregoing, any increase or
decrease in volume or securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any deviation
from the low or high end of the estimated maximum offering range may be
reflected in the form of prospectus filed with the Commission pursuant to Rule
424(b) if, in the aggregate, the changes in volume and price represent no more
than a 20% change in the maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the effective registration statement;
(iii) 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 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to 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.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Securities Act of 1933 and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by
the Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the Registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act of 1933 and will be governed by the final adjudication of such
issue.
II-5
<PAGE> 6
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant has duly caused this Pre-Effective Amendment No. 2 to the
Registration Statement on Form S-3 to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Jackson, State of Ohio,
on July 9, 1998.
OAK HILL FINANCIAL, INC.
By: /s/ John D. Kidd
------------------------
John D. Kidd, President
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement on Form S-3 has been signed by the following persons in
the capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/ John D. Kidd President, Chief July 9, 1998
- ----------------------------------- Executive Officer, Director )
John D. Kidd (Principal Executive Officer) )
)
)
*Evan E. Davis Chairman of the Board ) July 9, 1998
- ----------------------------------- )
Evan E. Davis )
)
)
*Richard P. LeGrand Executive Vice President and ) July 9, 1998
- ----------------------------------- Director )
Richard P. LeGrand )
)
)
*H. Tim Bichsel Secretary and Treasurer ) July 9, 1998
- ----------------------------------- (Principal Financial and Accounting )
H. Tim Bichsel Officer) )
)
)
*Barry M. Dorsey Director ) July 9, 1998
- ----------------------------------- )
Barry M. Dorsey )
)
)
*Rick A. McNelly Director ) July 9, 1998
- ----------------------------------- )
Rick A. McNelly )
)
)
*Donald R. Seigneur Director ) July 9, 1998
- ----------------------------------- )
Donald R. Seigneur )
)
)
/s/ H. Grant Stephenson Director ) July 9, 1998
- ----------------------------------- )
H. Grant Stephenson )
)
)
*C. Clayton Johnson Director ) July 9, 1998
- ----------------------------------- )
C. Clayton Johnson )
)
)
*D. Bruce Knox Director ) July 9, 1998
- ----------------------------------- )
D. Bruce Knox )
)
)
*By /s/ H. Grant Stephenson July 9, 1998
--------------------------------------
H. Grant Stephenson, Attorney-in-fact
for each of the persons indicated
</TABLE>
II-6
<PAGE> 7
EXHIBIT INDEX
EXHIBIT
NUMBER DESCRIPTION
------ -----------
1 Underwriting Agreement among the Selling Shareholders,
McDonald & Company Securities, Inc., and Advest, Inc. (Filed
herewith)
*2(a) Agreement and Plan of Merger, dated April 28, 1997, between
Oak Hill Banks and Unity Savings Bank (reference is made to
Exhibit 2(a) of the Registrant's 8-K, filed on October 14,
1997, and incorporated herein by reference).
*2(b) Supplemental Agreement, dated April 28, 1997, among Oak Hill
Financial, Inc., Oak Hill Banks, and Unity Savings Bank
(reference is made to Exhibit 2(b) of the Registrant's 8-K
filed on October 14, 1997, and incorporated herein by
reference).
*3(a) Second Amended and Restated Articles of Incorporation
(reference is made to Form SB-2, Exhibit 3(i), File No.
33-096216 and incorporated herein by reference).
*3(b) Restated Code of Regulations (reference is made to Form SB-2,
Exhibit 3(ii), File No. 33- 96216 and incorporated herein by
reference).
*4(a) Reference is made to Articles FOURTH, FIFTH, SEVENTH, EIGHTH,
TENTH AND ELEVENTH of the Registrant's Restated Articles of
Incorporation (contained in the Registrant's Restated Articles
of Incorporation filed as Exhibit 3(a) hereto) and Articles
II, III, IV, VI and VIII of the Registrant's Amended and
Restated Code of Regulations (contained in the Registrant's
Amended and Restated Code of Regulations filed as Exhibit 3(b)
hereto).
*4(b) Rights Plan, dated January 23, 1998, between Oak Hill
Financial, Inc., and Fifth Third Bank, (reference is made to
Exhibit 4.1 to the Form 8-A, filed with the Securities and
Exchange Commission on January 23, 1998 and incorporated
herein by reference).
5 Opinion of Porter, Wright, Morris & Arthur regarding legality.
(Previously filed)
*23(a) Consent of Porter, Wright, Morris & Arthur (included in
Exhibit 5)
23(b) Consent of Grant Thornton LLP. (Previously filed)
24 Powers of Attorney. (Previously filed)
- -----------------------------------------------
*Incorporated by reference as indicated
<PAGE> 1
Exhibit 1
OAK HILL FINANCIAL, INC.
1,006,250 Common Shares(1)
UNDERWRITING AGREEMENT
July , 1998
McDONALD & COMPANY SECURITIES, INC.
ADVEST, INC.
As Representatives of the Several Underwriters
named in Schedule B hereto
c/o McDONALD & COMPANY SECURITIES, INC.
McDonald Investment Center
800 Superior Avenue
Cleveland, Ohio 44114-2603
Gentlemen:
Oak Hill Financial, Inc. (the "Company"), the holding company of Oak
Hill Banks (the "Bank"), and Evan E. Davis, John D. Kidd, Richard P. LeGrand and
Donna J. Lloyd (each a "Selling Shareholder" and collectively, the "Selling
Shareholders") hereby confirm their agreement with you as follows:
1. Underwriters and Representatives. The term "Underwriters," as used
herein, will mean and refer collectively to you and the other Underwriters named
in Schedule B annexed hereto, and the term "Representative" will refer to you in
your capacity as a representative of the Underwriters for the offering of the
Common Shares, without par value, of the Company (the "Common Shares") referred
to herein. Except as may be expressly set forth below, any reference to you in
this Agreement shall be solely in your capacity as a Representative.
2. Shares Offered. The Selling Shareholders as set forth on Schedule A
propose to sell to the several Underwriters as set forth on Schedule B an
aggregate of 875,000 authorized and issued Common Shares. Such 875,000 Common
Shares proposed to be sold by the Selling Shareholders are hereinafter referred
to as the "Firm Shares." The amount of Common Shares proposed to be sold
- --------
(1) Includes an option to purchase from the Selling Shareholders up to
131,250 additional Common Shares, solely to cover over-allotments.
<PAGE> 2
by each Selling Shareholder is reflected in Schedule A hereto. In addition, the
Selling Shareholders propose to grant to the Underwriters an Option (as
hereinafter defined) to purchase up to an additional 131,250 issued outstanding
Common Shares (the "Option Shares") on the terms and for the purposes set forth
in Section 5(b) hereof. The Firm Shares and the Option Shares are hereinafter
sometimes together called the "Shares," and the Shares are more fully described
in the Registration Statement and Prospectus (as hereinafter defined).
3. Representations and Warranties of the Company. The Company
represents and warrants to the Underwriters that:
(a) The Company has prepared a Registration Statement on Form
S-3 (File No. 333-56463)relating to the Shares, including a Preliminary
Prospectus (as hereinafter defined), in conformity with the
requirements of the Securities Act of 1933, as amended (the "Act"), and
the rules, regulations and instructions (the "Rules and Regulations")
of the Securities and Exchange Commission (the "Commission") thereunder
and has filed such Registration Statement with the Commission. The
Company complies with the conditions for the use of Form S-3. One or
more amendments to such Registration Statement, including, in each
case, a revised Preliminary Prospectus, have been so prepared and
filed. If such Registration Statement has not become effective as of
the execution and delivery of this Agreement, and the filing of a
further amendment (the "Final Amendment") to such Registration
Statement is necessary to permit such Registration Statement to become
effective, such amendment will be filed promptly by the Company with
the Commission. If such Registration Statement has become effective and
any post-effective amendment has been filed with the Commission prior
to the execution and delivery of this Agreement, the most recent
post-effective amendment has been declared effective by the Commission.
If such Registration Statement has become effective and the Prospectus
included as part of the Registration Statement at the time it became
effective omitted information permitted to be omitted by Rule 430A of
the Rules and Regulations ("Rule 430A Information"), a final Prospectus
(the "Rule 430A Prospectus") containing all required Rule 430A
Information will promptly be filed by the Company pursuant to Rule
424(b) of the Rules and Regulations.
The term "Preliminary Prospectus" as used herein means any
form of prospectus (as referred to in Rule 430 of the Rules and
Regulations) with respect to the Shares included, at any time, as part
of such Registration Statement or filed with the Commission, pursuant
to Rule 424(a) of the Rules and Regulations, prior to such Registration
Statement being declared effective. The Registration Statement referred
to in this Section 3(a), as amended at the time that it becomes or
became effective, or, if applicable, as amended at the time the most
recent post-effective amendment to such Registration Statement filed
with the Commission prior to the execution and delivery of this
Agreement became effective, including financial statements and all
exhibits and other information (whether filed or incorporated by
reference) deemed to be part thereof at such time pursuant to Rule 430A
of the Rules and Regulations is herein called the "Registration
Statement." The final Prospectus relating to the Shares in the form
first filed with the Commission pursuant to Rule 424(b)(1) or (4) of
the Rules and Regulations or, if no such filing is required, the form
of final
2
<PAGE> 3
prospectus included in the Registration Statement at the Effective Date
(as hereafter defined) is herein called the "Prospectus." The date on
which the Registration Statement becomes effective is hereinafter
called the "Effective Date." As used herein, the terms "Registration
Statement", "Prospectus" and "Preliminary Prospectus" shall include in
each case the documents, if any, incorporated by reference therein.
(b) When the Registration Statement becomes effective, and at
all subsequent times to and including the Closing Time (as hereinafter
defined) and at the Option Exercise Time (as hereinafter defined), or
for such longer period as the Prospectus may be required by the Act or
the Rules and Regulations or the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), or the rules and regulations promulgated
thereunder to be delivered in connection with sales of the Shares by
the Underwriters or a dealer, the Registration Statement and the
Prospectus (as amended or as supplemented if the Company shall have
filed with the Commission any amendment thereof or supplement thereto;
provided, however, that no amendment or supplement to the Registration
Statement or the Prospectus shall be made without prior consultation
with you) will comply with the requirements of the Act and the Rules
and Regulations, will contain all statements required to be stated
therein in accordance with the Act and the Rules and Regulations, will
not contain an untrue statement of a material fact and will not omit to
state a material fact required to be stated therein or necessary in
order to make the statements therein, in the light of the circumstances
under which they were made, not misleading; provided, however, that the
representations and warranties in this subsection (b) do not apply to
statements or omissions in the Registration Statement or the Prospectus
based upon and made in conformity with written information furnished to
the Company through or on behalf of an Underwriter specifically for
inclusion therein.
(c) The Commission has not issued an order preventing or
suspending the use of any Preliminary Prospectus with respect to the
Shares and has not instituted or, to the Company's knowledge,
threatened to institute any proceedings with respect to such an order.
Each Preliminary Prospectus, when filed with the Commission, conformed
in all material respects with the requirements of the Act and the Rules
and Regulations and, as of its date, did not include any untrue
statement of a material fact or omit to state a material fact necessary
to make the statements therein, in the light of the circumstances under
which they were made, not misleading; provided, however, that the
representations and warranties in this sentence do not apply to
statements or omissions in each such Preliminary Prospectus based upon
and made in conformity with written information furnished to the
Company through or on behalf of an Underwriter specifically for
inclusion therein.
(d) The documents incorporated by reference into the
Preliminary Prospectus, the Prospectus or the Registration Statement
heretofore filed, when they were filed (or, if any amendment with
respect to any such document was filed, when such document was filed),
conformed in all material respects with the requirements of the
Exchange Act and the rules and regulations promulgated thereunder, any
additional documents so filed will, when they are filed, conform in all
material respects with the requirements of the Exchange Act and the
3
<PAGE> 4
rules and regulations promulgated thereunder; no such document when it
was filed (or, if an amendment with respect to any such document was
filed, when such amendment was filed), contained an untrue statement of
material fact or omitted to state a material fact required to be stated
therein, or necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading; and no
additional document so filed, when it is filed will contain an untrue
statement of material fact or omit to state a material fact required to
be stated therein, or necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading.
(e) The Company is, and at the Closing Time and at the Option
Exercise Time will be, a corporation duly organized, validly existing
and in good standing under the laws of the State of Ohio. The Company
has, and at the Closing Time and at the Option Exercise Time will have,
the power and authority (corporate, governmental, regulatory and
otherwise) and has or will have all necessary approvals, orders,
licenses, certificates, permits and other governmental authorizations
(collectively, the "Authorizations") to own or lease all of the assets
owned or leased by it and to conduct its business as described in the
Registration Statement and the Prospectus, except where the failure to
have any Authorization would not have a material adverse effect on the
condition (financial or otherwise), assets, business, properties,
prospects or results of operations of the Company and its Subsidiaries,
taken as a whole (a "Material Adverse Effect"). The Company is, and at
the Closing Time and at the Option Exercise Time will be, duly licensed
or qualified to do business and in good standing as a foreign
corporation in all jurisdictions (i) in which the nature of the
activities conducted by the Company requires such qualification and
(ii) in which the Company owns or leases real property, except where
the failure to be so licensed or qualified would not have a Material
Adverse Effect. The Articles of Incorporation and Code of Regulations
of the Company comply in all material respects with applicable law. A
complete and correct copy of the Articles of Incorporation and the Code
of Regulations of the Company, in each case as amended and as currently
in effect, have been delivered or made available to you or your
counsel, and no changes therein will be made subsequent to the date
hereof and prior to the expiration of the Option. Action Finance
Company, an Ohio corporation ("Action"), and the Bank (each a
"Subsidiary" and collectively, the "Subsidiaries") are the only
subsidiaries of the Company.
(f) The Bank is, and at the Closing Time and at the Option
Exercise Time will be, a bank duly organized, validly existing and in
good standing under the laws of the State of Ohio. The deposit accounts
of the Bank are insured up to applicable limits by the Federal Deposit
Insurance Corporation (the "FDIC"), and no proceedings for the
termination or revocation of such insurance are pending or, to the
knowledge of the Company or the Bank, threatened. The Bank has, and at
the Closing Time and at the Option Exercise Time will have, the power
and authority (corporate, governmental, regulatory and otherwise) and
has or will have all necessary Authorizations to own or lease all of
the assets owned or leased by it and to conduct its business as
described or incorporated by reference in the Registration Statement
and the Prospectus, except where the failure to have any Authorization
would not have a Material Adverse Effect. The Bank is, and at the
Closing Time and at the Option
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<PAGE> 5
Exercise Time will be, duly licensed or qualified to do business and in
good standing as a foreign corporation in all jurisdictions (i) in
which the nature of the activities conducted by the Bank requires such
qualification and (ii) in which the Bank owns or leases real property,
except where the failure to be so licensed or qualified would not have
a Material Adverse Effect. The Articles of Incorporation and Code of
Regulations of the Bank comply in all material respects with applicable
law. A complete and correct copy of the Articles of Incorporation and
the Code of Regulations of the Bank, in each case as amended and as
currently in effect, have been delivered or made available to you or
your counsel, and no changes therein will be made subsequent to the
date hereof and prior to the expiration of the Option.
(g) Action is, and at the Closing Time and at the Option
Exercise Time will be, a corporation duly organized, validly existing
and in good standing under the laws of the State of Ohio. Action has,
and at the Closing Time and at the Option Exercise Time will have, the
power and authority (corporate, governmental, regulatory and otherwise)
and has or will have all necessary Authorizations to own or lease all
of the assets owned or leased by it and to conduct its business as
described in the Registration Statement and the Prospectus, except
where the failure to have any Authorization would not have a Material
Adverse Effect. Action is, and at the Closing Time and at the Option
Exercise Time will be, duly licensed or qualified to do business and in
good standing as a foreign corporation in all jurisdictions (i) in
which the nature of the activities conducted by the Action requires
such qualification and (ii) in which Action owns or leases real
property, except where the failure to be so licensed or qualified would
not have a Material Adverse Effect. The Articles of Incorporation and
Code of Regulations of Action comply in all material respects with
applicable law. A complete and correct copy of the Articles of
Incorporation and the Code of Regulations of Action, in each case as
amended and as currently in effect, have been delivered or made
available to you or your counsel, and no changes therein will be made
subsequent to the date hereof and prior to the expiration of the
Option.
(h) This Agreement has been duly and validly authorized,
executed and delivered on behalf of the Company and constitutes a valid
and binding obligation of the Company enforceable in accordance with
its terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights and to general equity
principles, except as rights to indemnity and contribution hereunder
may be limited by applicable law. This Agreement and the resolutions of
the Board of Directors authorizing the same will be maintained
continuously as an official record of the Company consistent with the
provisions of 12 U.S.C. Section 1823(e).
(i) At the Closing Time and at the Option Exercise Time, the
Company will be authorized to issue only 5,000,000 Common Shares,
1,500,000 preferred shares, $.01 par value per share (the "Voting
Preferred Shares") and 1,500,000 non-voting preferred shares (the
"Non-Voting Preferred Shares"), and at the Closing Time and the Option
Exercise Time will have issued and outstanding, fully paid and
nonassessable, ________________ Common Shares and no Voting Preferred
Shares or Non-Voting Preferred Shares. At the Closing Time
5
<PAGE> 6
and at the Option Exercise Time, the Company will have authorized and
reserved for issuance pursuant to the exercise of options and warrants
only _______ Common Shares, pursuant to the Company's Amended and
Restated 1995 Stock Option Plan (the "Stock Option Plan"), without
giving effect to the exercise after the date hereof of any such options
or warrants. Subsequent to the date hereof and prior to the Closing
Time and the Option Exercise Time, the Company will not issue any
securities. Except as contemplated by this Agreement and as set forth
or incorporated by reference in the Registration Statement and the
Prospectus, the Company does not have outstanding, and at the Closing
Time and at the Option Exercise Time the Company will not have
outstanding, any options to purchase, or any rights or warrants to
subscribe for, or any securities or obligations convertible into, or
any contracts or commitments to issue or sell shares of capital stock
or any warrants, convertible securities or obligations.
(j) The consolidated financial statements of the Company and
the Bank (including the notes thereto) filed with and as part of the
Registration Statement and the Prospectus, or incorporated by reference
therein, fairly present the financial position of the Company and the
Bank as of the respective dates thereof and the consolidated results of
operations, cash flows and shareholders' equity of the Company and the
Bank for the respective periods indicated, have been prepared in
conformity with generally accepted accounting principles applied on a
basis consistent with prior periods (except as otherwise described in
the notes thereto), and comply as to form in all material respects with
any applicable accounting requirements of the Commission and the FDIC.
Grant Thornton, LLP (the "Company's Accountants"), who have audited and
reported on such consolidated financial statements, is a firm of
independent certified public accountants within the meaning of the Code
of Professional Conduct of the American Institute of Certified Public
Accountants, as required by the Act and the Rules and Regulations. The
financial information and data set forth in the Prospectus are fairly
presented and were prepared on a basis consistent with such financial
statements or the books and records of the Company, as the case may be.
No financial statements or schedules are required to be included in the
Registration Statement or the Prospectus which are not included
therein.
(k) The financial and statistical information and data set
forth in the Prospectus under the captions "THE COMPANY," "SELECTED
CONSOLIDATED FINANCIAL INFORMATION," "RISK FACTORS," "PRICE RANGE OF
COMMON STOCK AND DIVIDENDS," "MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS," and "SELLING
SHAREHOLDERS" are true and correct in all material respects and, as to
the financial information, are prepared on a basis consistent with the
audited consolidated financial statements of the Company.
(l) Subsequent to the respective dates as of which information
is given in the Registration Statement and the Prospectus and at all
times prior to the expiration of the Option, except as set forth in or
contemplated by the Registration Statement and the Prospectus, (i) the
Company has and will have conducted its business in substantially the
same manner as on March 31, 1998; (ii) the Company has not incurred and
will not have
6
<PAGE> 7
incurred any material liabilities or obligations, direct or contingent,
or entered into any material transactions not in the ordinary course of
business; (iii) the Company has not paid or declared and will not pay
or declare any dividends or other distributions on its capital stock;
and (iv) there has not been and will not have been any change in the
capitalization of the Company or any other change which would have a
Material Adverse Effect.
(m) There are no actions, suits or proceedings at law or in
equity pending or, to the knowledge of the Company, threatened against
the Company or any of its Subsidiaries or any of their respective
assets or any of their respective officers or directors before or by
any federal, state, county or local court, commission, regulatory body,
arbitration panel, administrative agency or other governmental body,
domestic or foreign, wherein an unfavorable ruling, decision or finding
could have a Material Adverse Effect. Neither the Company nor any of
its Subsidiaries is involved in any labor dispute nor, to the Company's
knowledge, is any such dispute threatened, which dispute could have a
Material Adverse Effect.
(n) Neither the Company nor the Bank is in violation of any
rule or regulation of the Commission, the Board of Governors of the
Federal Reserve System (the "Federal Reserve"), the Ohio Division of
Banks (the "Division") or the FDIC, which would materially and
adversely affect the condition (financial or otherwise), operations,
business, assets or properties of the Company and the Bank, taken as a
whole. Neither the Company nor the Bank is subject to any directive
from the Federal Reserve, the Division or the FDIC to make any change
in the method of conducting its business or affairs, and the Company
and the Bank have conducted their business in compliance with all
applicable statutes and regulations (including, without limitation, all
regulations, decisions, directives and orders of the Federal Reserve,
the Division and the FDIC), except where the failure to so comply would
not have a Material Adverse Effect. Except as set forth or incorporated
by reference in the Prospectus, there is not pending or, to the
knowledge of the Company or the Bank, threatened any litigation,
charge, investigation, action, suit or proceeding before or by any
court, regulatory authority or governmental agency or body which,
individually or in the aggregate, would affect the performance of the
terms and conditions of this Agreement or the consummation of the
transactions contemplated hereby or which, individually or in the
aggregate, would have a Material Adverse Effect.
(o) There has been no material adverse change in the condition
(financial or otherwise), assets, business, properties, prospects or
results of operations of the Company and its Subsidiaries, taken as a
whole, since the latest date as of which such condition is set forth or
incorporated by reference in the Prospectus, except as referred to
therein. The capitalization, assets, properties and business of the
Company and the Bank conform in all material respects to the
descriptions thereof contained or incorporated by reference in the
Prospectus as of the date specified. Subsequent to the respective dates
as of which information is given in the Prospectus, except as otherwise
may be indicated therein, neither the Company nor the Bank has issued
any securities or incurred any liability or obligation, direct or
contingent, for borrowed money, except borrowings in the ordinary
course of
7
<PAGE> 8
business, or entered into any other transaction not in the ordinary
course of business, which is material in light of the businesses and
properties of the Company and the Bank, taken as a whole. Neither the
Company nor any of its Subsidiaries has any material contingent
liabilities of any kind, except as set forth or incorporated by
reference in the Prospectus.
(p) Except as set forth or incorporated by reference in the
Prospectus, no material default (or event which, with notice or lapse
of time, or both, would constitute a material default) exists on the
part of either the Company or the Bank or, to their knowledge, on the
part of any other party, in the due performance and observance of any
term, covenant or condition of any agreement to which the Company or
the Bank is a party and which is material to the condition (financial
or otherwise) of the Company and the Bank, taken as a whole. Such
agreements are in full force and effect, and no other party to any such
agreement has instituted or, to the knowledge of the Company or the
Bank, threatened any action or proceeding wherein the Company or the
Bank is or would be alleged to be in default thereunder, under
circumstances where such action or proceeding, if determined adversely
to the Company or the Bank, would have a Material Adverse Effect.
(q) Neither the Company nor the Bank is in violation of its
respective Articles of Incorporation or Code of Regulations, in each
case as amended as of the date hereof, or is in default, in any
material respect, in the performance of any material obligations,
agreement or condition contained in any bond, debenture, note or any
other evidence of indebtedness by which it is bound. The execution,
delivery and fulfillment of the terms of this Agreement and the
consummation of the transactions contemplated hereby do not and will
not (i) violate or conflict with the respective Articles of
Incorporation or the Code of Regulations of the Company or the Bank,
(ii) violate, conflict with or constitute a breach of, or default (or
an event which, with notice or lapse of time, or both, would constitute
a default) under, any agreement, indenture or other instrument to which
the Company or the Bank is a party, (iii) result in a breach or
violation of any of the terms and provisions of, or constitute a
default (or give rise to a state of facts which, with notice or lapse
of time, or both, would constitute a default) under or result in the
creation or imposition of any lien, charge or encumbrance upon the
assets or properties of the Company or the Bank, pursuant to any
indenture, mortgage, deed of trust, voting trust agreement, loan
agreement, letter of credit agreement, bond, debenture, note agreement
or other evidence of indebtedness, lease, contract or other agreement
or instrument to which the Company or the Bank is a party or by which
the Company, the Bank or any of their respective properties are bound,
or (iv) violate or conflict with any governmental license or permit or
any law, administrative regulation or authorization, approval, court
decree, injunction or order; except such breaches, violations or
defaults as would not have a Material Adverse Effect.
(r) The Company and its Subsidiaries have, and at the Closing
Time and at the Option Exercise Time will have, complied in all
material respects, except as described or incorporated by reference in
the Prospectus, with all laws, regulations, ordinances and orders
relating to public health, safety or the environment (including without
limitation all laws, regulations, ordinances and orders relating to
releases, discharges, emissions or disposals to
8
<PAGE> 9
air, water, land or groundwater, to the withdrawal or use of
groundwater, to the use, handling or disposal of polychlorinated
biphenyls, asbestos or urea formaldehyde, to the treatment, storage,
disposal or management of hazardous substances, pollutants or
contaminants, or to exposure to toxic, hazardous or other controlled,
prohibited or regulated substances), the violation of which would or
might have a Material Adverse Effect on the consummation of the
transactions contemplated by this Agreement. In addition, and
irrespective of such compliance, neither the Company nor any of its
Subsidiaries is subject to any liability for environmental remediation
or clean-up, including any liability or class of liability of the
lessee under the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended, or the Resource Conservation and
Recovery Act of 1976, as amended, which liability would or might have a
Material Adverse Effect on the consummation of the transactions
contemplated by this Agreement.
(s) The Company (i) keeps books, records and accounts that, in
reasonable detail, accurately and fairly reflect the transactions and
dispositions of the assets of the Company and the Bank, and (ii)
maintains a system of internal accounting controls sufficient to
provide reasonable assurances that (A) transactions are executed in
accordance with management's general or specific authorization, (B)
transactions are recorded as necessary to permit preparation of
financial statements in conformity with generally accepted accounting
principles and to maintain accountability for assets, (C) access to
assets is permitted only in accordance with management's general or
specific authorization and (D) the recorded accountability for assets
is compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any differences. Neither
the Company nor any of its Subsidiaries has made any payment to any
state, federal or foreign governmental officer or official or other
person charged with similar public or quasi-public duties (other than
payments required or permitted by the laws of the United States or any
jurisdiction thereof.)
(t) The outstanding Common Shares have been duly authorized
and validly issued, and are fully paid and nonassessable and not
subject to preemptive rights. The holders of Common Shares will not be
subject to personal liability for the obligations of the Company solely
by reason of being such holders. The Common Shares and the Shares
conform, and when the Registration Statement becomes effective and, at
the Closing Time and at the Option Exercise Time, will conform, to all
statements with regard thereto contained or incorporated by reference
in the Registration Statement and the Prospectus.
(u) All of the issued and outstanding shares of capital stock
of the Bank have been duly authorized and validly issued, are fully
paid and non-assessable and are owned by the Company, free and clear of
any liens, charges, encumbrances or restrictions, except as set forth
or incorporated by reference in the Prospectus. Except for shares of
capital stock of the Bank and Action, the Company does not own, and at
the Closing Time and at the Option Exercise Time will not own, any
shares of capital stock or any other equity securities of any
corporation or have any equity interest in any firm, partnership or
other entity.
9
<PAGE> 10
(v) No consent, approval, authorization or order of any court
or governmental agency or body is required for the consummation by the
Company of the transactions contemplated by this Agreement, except such
as may be required under the Act, the Exchange Act or under state
securities or Blue Sky laws or except such as have been obtained.
(w) The Company and the Bank have good and marketable title to
all properties and assets described in the Prospectus or any document
incorporated by reference in the Prospectus as owned by them, free and
clear of all liens, charges, encumbrances or restrictions, except such
as are described in or referred to in the Prospectus or any document
incorporated by reference in the Prospectus or such as would not have a
Material Adverse Effect. The Company and the Bank have valid,
subsisting and enforceable leases for the properties reflected in the
Prospectus or any document incorporated by reference in the Prospectus
as leased by them, except as enforceability may be limited by general
equitable principles, bankruptcy, insolvency, moratorium,
reorganization or other laws affecting creditors' rights generally.
(x) There is no document or contract of a character required
to be described in the Prospectus or to be filed as an exhibit to the
Registration Statement which is not described or filed as required. No
statement, representation, warranty or covenant made by the Company in
this Agreement or in any certificate or document required by this
Agreement to be delivered to you is, was when made or, as of the
Closing Time and the Option Exercise Time, will be, inaccurate, untrue
or incorrect. No transaction has occurred between or among the Company
or any Subsidiary and any of their respective officers, directors or
shareholders or any affiliate of any such officer, director or
shareholder that is required by the Act or the Rules and Regulations to
be described in, and is not described in, the Registration Statement,
the Prospectus or the documents incorporated by reference therein.
(y) The Company and its Subsidiaries own or possess all
patents, patent rights, licenses, inventions, copyrights, know-how
(including trade secrets, applications and other unpatented or
unpatentable proprietary or confidential information, systems or
procedures), trademarks, service marks and trade names (collectively,
"Proprietary Rights") used in or necessary for the conduct of the
business of the Company as now conducted and as proposed to be
conducted as described in the Prospectus or the documents incorporated
by reference in the Prospectus, except where the failure to own such
Proprietary Rights would not have a Material Adverse Effect. The
Company and its Subsidiaries have the right to use all Proprietary
Rights used in or necessary for the conduct of their respective
businesses without infringing the rights of any person or violating the
terms of any licensing or other agreement to which the Company or any
Subsidiary is a party and, to the Company's knowledge, no person is
infringing upon any of the Proprietary Rights, except where the
infringement of or lack of a right to use such Proprietary Rights would
not have a Material Adverse Effect. Except as disclosed in the
Prospectus or the documents incorporated by reference into the
Prospectus, no charges,
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<PAGE> 11
claims or litigation have been asserted or, to the Company's knowledge,
threatened against the Company or any Subsidiary contesting the right
of the Company or any Subsidiary to use, or the validity of, any of the
Proprietary Rights or challenging or questioning the validity or
effectiveness of any license or agreement pertaining thereto or
asserting the misuse thereof, and, to the Company's knowledge, no valid
basis exists for the assertion of any such charge, claim or litigation.
All licenses and other agreements to which the Company or any
Subsidiary is a party relating to Proprietary Rights are in full force
and effect and constitute valid, binding and enforceable obligations of
the Company or such Subsidiary and, to the Company's knowledge, the
other parties thereto, subject in each case to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws of
general applicability relating to or affecting creditors' rights and to
general equity principles, as the case may be, and there have not been
and there currently are not any defaults (or any event which, with
notice or lapse of time, or both, would constitute a default) by the
Company or any Subsidiary under any license or other agreement
affecting Proprietary Rights used in or necessary for the conduct of
the business of the Company or any Subsidiary, except for defaults, if
any, which would not have a Material Adverse Effect. The validity,
continuation and effectiveness of all licenses and other agreements
relating to the Proprietary Rights and the current terms thereof will
not be affected by the transactions contemplated by this Agreement.
(z) Neither the Company nor any Subsidiary is conducting or
intends to conduct its business in a manner in which it would become an
"investment company" as defined in Section 3(a) of the Investment
Company Act of 1940, as amended.
(aa) All issuances and sales by the Company of its securities
prior to the date hereof were either (i) registered under the Act, or
(ii) exempt from registration under the Act, and all such issuances and
sales complied in all respects with the provisions of all applicable
federal and state securities laws. Except as set forth in or
contemplated by the Prospectus, no holder of any securities of the
Company has the right to require registration of any Common Shares or
other securities of the Company because of the filing or effectiveness
of the Registration Statement.
(bb) Neither the Company nor any of its officers or directors
or affiliates (as defined in the Rules and Regulations) has taken or
will take, directly or indirectly, any action designed to stabilize or
manipulate the price of any security of the Company or any action which
has constituted or which might reasonably be expected to cause or
result in stabilization or manipulation of the price of any security of
the Company, to facilitate the sale or resale of any of the Shares.
(cc) The Company and the Bank have not, and at the Closing
Time and at the Option Exercise Time will not have, incurred any
liability for financial advisory, finder's or brokerage fees or agent's
commissions in connection with the offer and sale of the Shares, this
Agreement or the transactions hereby contemplated.
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<PAGE> 12
(dd) For each of the past ten years, the Company and the Bank
have timely filed all federal, state, local and foreign income,
employment, withholding, franchise and other tax returns required to be
filed through the date hereof and have paid all taxes shown as due
thereon or made adequate reserves for similar future tax liabilities.
Except as disclosed or incorporated by reference in the Prospectus, no
tax deficiency has been, nor does the Company have any knowledge of any
tax deficiency which might be, asserted against the Company or the Bank
by any taxing authorities, which would have a Material Adverse Effect.
(ee) All contracts and other documents required to be filed as
exhibits to the Registration Statement have been filed with the
Commission.
(ff) Neither the Company nor the Bank has engaged in any
transaction in connection with which the Company or the Bank could be
subject to either a civil penalty assessed pursuant to Section 502(i)
of the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), or a tax imposed by Section 4975 of the Internal Revenue
Code of 1986, as amended (the "Code"). No material liability to the
Pension Benefit Guaranty Corporation has been, or is expected by the
Company or the Bank to be, incurred by the Company or the Bank with
respect to any pension plan subject to ERISA (a "Pension Plan"). There
has been no "reportable event" within the meaning of Section 4043(b) of
ERISA with respect to any Pension Plan and no event or condition which
presents a material risk of the termination of any Pension Plan by the
Pension Benefit Guaranty Corporation. Full payment has been made of all
amounts which the Bank is required, under the terms of any Pension
Plan, to have paid as contributions to such Pension Plan as of the date
hereof, and no "accumulated funding deficiency," as defined in Section
302 of ERISA and Section 412 of the Code, whether or not waived, exists
with respect to any Pension Plan.
(gg) The Company and the Bank are in compliance in all
material respects with applicable financial record-keeping and
reporting requirements of the Currency and Foreign Transactions
Reporting Act of 1970, as amended, and the regulations and rules
promulgated thereunder.
(hh) To the knowledge of the Company and the Bank, (i) neither
the Company, the Bank nor the employees of the Company or the Bank has
made any payment of funds of the Company or the Bank as a loan for the
purchase of the Shares or made any payment of funds prohibited by law,
and (ii) no funds have been set aside to be used for any payment
prohibited by law.
(ii) The Company and the Bank have not relied upon the
Underwriters or their legal counsel or other advisors for any legal,
tax or accounting advice in connection with the transactions
contemplated by this Agreement.
4. Representations and Warranties of the Selling Shareholders. Each of
the Selling
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<PAGE> 13
Shareholders severally represents and warrants to the Underwriters and, except
as to matters covered in subsection (e), to the Company that:
(a) Such Selling Shareholder has, and at the Closing Time and
the Option Exercise Time, as the case may be, will have, good and
marketable title to the Shares proposed to be sold by such Selling
Shareholder hereunder on such date and full right, power and authority
to enter into this Agreement and to sell, assign, transfer and deliver
the Shares reflected on Schedule A as being sold by such Selling
Shareholder hereunder, free and clear of all voting trust and/or
buy-sell arrangements, liens, encumbrances, equities, claims,
restrictions and community property rights, other than those created by
the Power of Attorney (as hereinafter defined) and the Custody
Agreement (as hereinafter defined) or this Agreement for the benefit of
the Underwriters. Upon delivery of and payment for such Shares
hereunder, the Underwriters will acquire good and marketable title
thereto, free and clear of all voting trust and/or buy-sell
arrangements, liens, encumbrances, equities, claims, restrictions and
community property rights.
(b) Such Selling Shareholder has not taken and will not take,
directly or indirectly, any action designed to or which might be
reasonably expected to cause or result in, under the Exchange Act or
otherwise, stabilization or manipulation of the price of any security
of the Company to facilitate the sale or resale of the Shares.
(c) Such Selling Shareholder (other than John D. Kidd) has
executed and delivered a Power of Attorney (the "Power of Attorney")
between the Selling Shareholder and John D. Kidd (the "Agent"), naming
the Agent as such Selling Shareholder's attorney-in-fact (and, by the
execution by the Agent of this Agreement, such Agent hereby represents
and warrants that he has been duly appointed as attorney-in-fact by
each of the other Selling Shareholders pursuant to the Power of
Attorney) for the purpose of entering into and carrying out this
Agreement, and the Power of Attorney has been duly executed by such
Selling Shareholder and a copy thereof has been delivered to you.
(d) Such Selling Shareholder has deposited in custody, under a
Custody Agreement (the "Custody Agreement"), with John D. Kidd, as
custodian (the "Custodian"), certificates in negotiable form for the
Shares to be sold hereunder by such Selling Shareholder, for the
purpose of further delivery pursuant to this Agreement. Such Selling
Shareholder agrees that the Shares to be sold by such Selling
Shareholder on deposit with the Custodian are subject to the interests
of the Company, the Underwriters and the other Selling Shareholders,
that the arrangements made for such custody and the appointment of the
Agent pursuant to the Power of Attorney are to that extent irrevocable,
and that the obligations of such Selling Shareholder hereunder and
under the Power of Attorney and the Custody Agreement shall not be
terminated except as provided in this Agreement, the Power of Attorney
or the Custody Agreement by any act of such Selling Shareholder, by
operation of law, whether by the death or incapacity of such Selling
Shareholder, or by the occurrence of any other event. If any Selling
Shareholder should die or become incapacitated, or if any other event
should occur before the delivery
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<PAGE> 14
of the Shares hereunder, the documents evidencing Shares then on
deposit with the Custodian shall be delivered by the Custodian in
accordance with the terms and conditions of this Agreement as if such
death, incapacity or other event has not occurred, regardless of
whether the Custodian shall have received notice thereof. The Agent has
been authorized by such Selling Shareholder to execute and deliver this
Agreement, and the Custodian has been authorized to receive and
acknowledge receipt of the proceeds of sale of the Shares to be sold by
such Selling Shareholder against delivery thereof and otherwise to act
on behalf of such Selling Shareholder. The Custody Agreement has been
duly executed by such Selling Shareholder and a copy thereof has been
delivered to you.
(e) Each Preliminary Prospectus, insofar as it relates to each
Selling Shareholder and, to the knowledge of each Selling Shareholder
in all other respects, as of its date, has not included, and will not
include, any untrue statement of a material fact and has not omitted or
will not omit to state a material fact required to be stated therein or
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading. When the
Registration Statement becomes effective, and at all times subsequent
thereto, neither the Registration Statement nor the Prospectus, nor any
amendment thereof of supplement thereto, as it relates to each Selling
Shareholder, and, to the knowledge of each Selling Shareholder in all
other respects, included or will include any untrue statement of a
material fact or omitted or will omit to state any material fact
required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading; provided, however, that the immediately
preceding clause shall not have any effect if information has been
given by each Selling Shareholder to the Company and the Underwriters
in writing which would eliminate or remedy any such untrue statement or
omission; and provided, further, however, that the representations and
warranties in this subsection (e) do not apply to statements or
omissions in the Preliminary Prospectus, the Registration Statement or
the Prospectus based upon and made in conformity with written
information furnished to the Company through or on behalf of the
Underwriters specifically for inclusion therein.
(f) Each Selling Shareholder will not sell, contract to sell
or otherwise dispose of any Common Shares or any securities convertible
into Common Shares for a period of 120 days after the Effective Date
without the prior written consent of the Underwriters.
(g) In order to document the Underwriters' compliance with the
reporting and withholding provisions of the Internal Revenue Code of
1986, as amended, with respect to the transactions herein contemplated,
each of the Selling Shareholders agrees to deliver to you, prior to or
at the Closing Time, a properly completed and executed United States
Treasury Department Form W-8 or W-9 (or other applicable form of
statement specified by Treasury Department regulations in lieu
thereof).
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<PAGE> 15
5. Purchase, Sale and Delivery of the Shares; Closing; Distribution.
(a)(i) On the basis of the representations and warranties set
forth in this Agreement and subject to the terms and conditions herein
set forth, the Selling Shareholders, severally and not jointly, agree
to sell to the Underwriters 875,000 Firm Shares as reflected in
Schedule A hereto, and the Underwriters, severally and not jointly,
agree to purchase such 875,000 Firm Shares from the Selling
Shareholders, at and for a price of $ per Share (the "Purchase
Price"), only in those jurisdictions and in such amounts where due
qualification and/or registration has been effected or an exemption
from such qualification and/or registration is available under the
applicable securities or Blue Sky laws of such jurisdiction. This
agreement to purchase Shares only covers the initial sale of the Shares
by the Underwriters and not any subsequent sale of such Shares in any
trading market which may develop after the public offering.
(ii) Delivery of the Firm Shares shall be made to the
Representatives at the offices of McDonald & Company Securities, Inc.
("McDonald & Company"), at McDonald Investment Center, 800 Superior
Avenue, Cleveland, Ohio 44114-2603, or such other location as you and
the Selling Shareholders shall agree, against payment by you of the
purchase price therefor by delivery of certified or bank cashier's
checks payable in next day funds to the order of each of the Selling
Shareholders for the Shares sold by each of them, at 10:00 a.m.,
Cleveland time, on July , 1998, or on such other business day
(Saturdays, Sundays and legal holidays in the City of Cleveland not
being considered business days for the purposes of this Agreement) not
later than the fourth full business day following the date of this
Agreement as you shall determine and advise the Company by at least two
full business days' notice in writing, which time and date are herein
called the "Closing Time." Delivery of the Firm Shares shall be made in
registered form in such name or names and in such denominations as you
shall request by at least two full business days' notice in writing.
The cost of original issue tax stamps and transfer stamps, if any, in
connection with the issuance and delivery or sale of the Firm Shares by
the Selling Shareholders to the Underwriters shall be borne by the
Selling Shareholders. The Selling Shareholders will pay and save
harmless each Underwriter, or its nominees, and any subsequent holder
of the Firm Shares from any and all liabilities with respect to or
resulting from any failure or delay in paying federal or state stamp
and other transfer taxes, if any, which may be payable or determined to
be payable in connection with the sale by the Selling Shareholders to
such Underwriter of the Firm Shares or any portion thereof.
(iii) The Selling Shareholders, through their Custodian, will
make the certificates for the Firm Shares available to you for
examination at such offices as you shall designate, not later than 2:00
p.m., on the business day preceding the Closing Time.
(iv) The obligations of each Underwriter to purchase and pay
for the Firm Shares shall be subject to compliance as of such date with
all the conditions specified in Section 9 hereof and to the absence of
any termination of this Agreement pursuant to
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<PAGE> 16
Section 11.
(b)(i) The Selling Shareholders indicated on Schedule A,
severally and not jointly, hereby grant to the Underwriters an option
(the "Option") to purchase from such Selling Shareholders up to 131,250
Option Shares, at and for a price for each Option Share equal to the
Purchase Price; provided, however, that the Option may be exercised
only for the purpose of covering any over-allotments which may be made
by you in connection with the distribution and sale of the Firm Shares.
(ii) The Option is exercisable by you in whole or in part at
any time on or before 12:00 noon, Cleveland time, on the day prior to
the Closing Time, and at any time thereafter during the period ending
30 days after the date of the Prospectus, by giving notice to the
Company in the manner provided in Section 12 hereof, setting forth the
number of Option Shares as to which the Option is being exercised, the
name or names in which the certificates for such Option Shares are to
be registered, the denominations of such certificates and the date of
delivery of such Option Shares, which date, if not the Closing Time,
shall not be less than two nor more than five business days after such
notice.
(iii) Upon the exercise of the Option, the Selling
Shareholders indicated on Schedule A shall sell to the Underwriters the
number of Option Shares specified in the notice exercising the Option,
and the Underwriters, on the basis of the representations and
warranties of the Selling Shareholders contained herein and in each
certificate and document contemplated under this Agreement to be
delivered to you, but subject to the terms and conditions of this
Agreement, severally and not jointly, shall purchase from such Selling
Shareholders the number of Option Shares specified in such notice.
(iv) Delivery of the Option Shares with respect to which the
Option shall have been exercised shall be made to the Representatives
at the offices of McDonald & Company at McDonald Investment Center, 800
Superior Avenue, Cleveland, Ohio 44114-2603 or such other location as
you and the Agent shall agree, against payment by you, as Underwriters,
of the aggregate Purchase Price therefor to the Selling Shareholders
indicated on Schedule A by certified or bank cashier's check or checks
payable in next-day funds to the order of each of such Selling
Shareholders in the amount to which such Selling Shareholders are
entitled, at 10:00 a.m., Cleveland time, on the date and in the place
designated in the notice given by you as above provided for, unless
some other place, time and date is mutually agreed upon (such time and
date being herein called the "Option Exercise Time"). The cost of
original issue tax stamps or transfer stamps, if any, in connection
with each issuance and delivery of the Option Shares by such Selling
Shareholders to the Underwriters shall be borne by such Selling
Shareholders. The Selling Shareholders indicated on Schedule A will pay
and save harmless each Underwriter, or its nominees, and any subsequent
holder of Option Shares from any and all liabilities with respect to or
resulting from any failure or delay in paying federal and state stamp
taxes, if any, which may be payable or determined to be payable as a
result of
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<PAGE> 17
the sale by such Selling Shareholders to such Underwriters of the
Option Shares or any portion thereof.
(v) The Selling Shareholders indicated on Schedule A, through
their Custodian, will make the certificates for the Option Shares to be
purchased at the Option Exercise Time available to you for examination
at such offices as you shall designate, not later than 2:00 p.m., on
the business day next preceding such Option Exercise Time.
(vi) The obligation of each Underwriter to purchase and pay
for the Option Shares at the Option Exercise Time shall be subject to
compliance as of such date with all the conditions specified in Section
9 hereof and to the absence of any termination of this Agreement
pursuant to Section 11 hereof.
(c) Subject to the terms and conditions hereof, the
Underwriters agree that (i) they will offer the Shares to the public as
set forth in the Prospectus as soon after the Registration Statement
becomes effective as may be practicable, (ii) they will offer and sell
the Shares to the public only in those jurisdictions and in such
amounts where due qualification and/or registration has been effected
or an exemption from such qualification and/or registration is
available under the applicable securities or Blue Sky laws of such
jurisdiction, and (iii) the Shares will be offered and sold only in
those jurisdictions where broker/dealer licensing has been obtained or
where there is an exemption from such licensing. This agreement to
offer Shares to the public only covers the initial sale of the Shares
by the Underwriters and not any subsequent sale of such Shares in any
trading market which may develop after the public offering.
6. Registration Statement and Prospectus.
(a) The Company will deliver to you, without charge, two fully
signed copies of the Registration Statement and of each amendment
thereto (including all financial statements, exhibits and documents
incorporated by reference) and the number of conformed copies of the
Registration Statement and of each amendment thereto (including all
financial statements and documents incorporated by reference, but
excluding exhibits) as you may reasonably request.
(b) The Company has delivered to the Underwriters and to each
of the dealers selected by you in connection with the distribution of
the Shares (a "Selected Dealer" and, collectively, "Selected Dealers"),
without charge, as many copies as you have requested of each
Preliminary Prospectus heretofore filed with the Commission and will
deliver to the Underwriters and to any Selected Dealer, without charge,
on the Effective Date, and thereafter from time to time during the
period in which the Prospectus is required by law to be delivered in
connection with sales of Shares by an Underwriter or a dealer, as many
copies of the Prospectus and any documents incorporated by reference
(and, in the event of any amendment of or supplement to the Prospectus,
of such amended or supplemented Prospectus) as you may reasonably
request.
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<PAGE> 18
(c) The Company has authorized the Underwriters to use and to
make available for use by prospective dealers the Preliminary
Prospectuses and authorizes the Underwriters, all Selected Dealers and
all dealers to whom any of such Shares may be sold by the Underwriters
or by any Selected Dealer to use the Prospectus, as from time to time
amended or supplemented, in connection with the sale of the Shares in
accordance with the applicable provisions of the Act, the applicable
Rules and Regulations and applicable state law until completion of the
public offering of the Shares and for such longer period as you may
request if the Prospectus is required to be delivered in connection
with sales of the Shares by an Underwriter or a dealer.
7. Covenants of the Company. The Company covenants and agrees with the
Underwriters that:
(a) After the execution and delivery of this Agreement, the
Company will not at any time, whether before or after the Effective
Date, file any amendment of or supplement to the Registration Statement
or the Prospectus of which you shall not previously have been advised
and furnished with a copy, or which you or Vorys, Sater, Seymour and
Pease LLP ("Counsel for the Underwriters") shall not have approved
(which approval shall not be unreasonably withheld or delayed) or which
is not in compliance with the Act or the Rules and Regulations.
(b) If the Registration Statement has not become effective,
the Company will promptly file the Final Amendment with the Commission
and will use its best efforts to cause the Registration Statement to
become effective. If the Registration Statement has become effective,
the Company will file the Rule 430A Prospectus or other Prospectus with
the Commission as promptly as practicable, but in no event later than
is permitted by Rule 424(b). The Company will promptly advise you (i)
when the Registration Statement or any post-effective amendment thereto
shall hereafter become effective, or any amendments or supplements to
the Prospectus or any document which shall be incorporated by reference
into the Prospectus shall have been filed with the Commission; (ii) of
the nature and substance of any request of the Commission or any state
or other regulatory body for any amendment or supplement of the
Registration Statement or the Prospectus or for additional information;
(iii) of the issuance by the Commission of any stop order suspending
the effectiveness of the Registration Statement or of any order
preventing or suspending the use of any Preliminary Prospectus or
prohibiting the offer or sale of any of the Shares or of the initiation
of any proceedings for such purpose; (iv) of any receipt by the Company
of any notification with respect to the suspension of qualification of
the Shares for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose; and (v) of the
happening of any event during the periods in which the Prospectus is to
be used in conjunction with the offer or sale of Shares which makes any
statement made in the Registration Statement or the Prospectus untrue
in any material respect or which requires the making of any changes in
the Registration Statement or the Prospectus in order to make the
statements therein not
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<PAGE> 19
misleading. The Company will use its best efforts to prevent the
issuance of any stop order or any order preventing or suspending the
use of the Registration Statement or Prospectus and, if such order is
issued, to obtain the lifting thereof as promptly as possible.
(c) The Company will prepare and file with the Commission,
upon your request, any such amendments of or supplements to the
Registration Statement or the Prospectus, in form satisfactory to
Porter, Wright, Morris & Arthur ("Counsel for the Company"), as, in the
opinion of Counsel for the Underwriters, may be necessary or advisable
in connection with the distribution of the Shares or any change in the
price at which, or the terms upon which, the Shares may be offered by
you and will use its best efforts to cause the same to become effective
as promptly as possible.
(d) The Company will comply with the Act, the Rules and
Regulations and the Exchange Act, and the rules and regulations
thereunder, so as to permit the continuance of sales of and dealings in
the Shares under the Act and the Exchange Act. If at any time when a
prospectus is required to be delivered under the Act an event shall
have occurred as a result of which it is necessary to amend or
supplement the Prospectus in order to make the statements therein not
untrue or not misleading in any material respect or to make the
Prospectus comply with the Act and the Rules and Regulations, the
Company will notify you promptly thereof and will, subject to the
provisions of Section 7(a) hereof, file with the Commission an
amendment or supplement which will correct such statement in accordance
with the requirements of Section 10 of the Act and shall furnish to the
Underwriters a reasonable number of copies of an amendment or
amendments or of a supplement or supplements to the Prospectus (in form
and substance reasonably satisfactory to Counsel for the Company and
Counsel for the Underwriters) which shall amend or supplement the
Prospectus so that, as amended or supplemented, the Prospectus will not
contain any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in the
light of the circumstances existing at the time the Prospectus is
delivered to a purchaser of the Shares, not misleading. The Company
will not file or use any amendment or supplement to the Registration
Statement or the Prospectus of which the Underwriters have not first
been furnished a copy or as to which the Underwriters shall reasonably
object after having been furnished such copy. For the purposes of this
subsection (d), the Company and the Bank shall furnish such information
with respect to themselves as the Underwriters from time to time
reasonably may request.
(e) The Company will comply with all of the provisions of any
undertakings contained in the Registration Statement.
(f) The Company will take all reasonable actions to furnish to
whomever you direct, when and as requested by you, all necessary
documents, exhibits, information, applications, instruments and papers
as may be required or, in the opinion of Counsel for the Underwriters,
desirable in order to permit or facilitate the sale of the Shares. The
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<PAGE> 20
Company will use its best efforts to qualify or register the Shares for
sale under the so-called Blue Sky laws of such jurisdictions as you
shall request, to make such applications, file such documents and
furnish such information as may be required for such purpose and to
comply with such laws so as to continue such qualification in effect so
long as required for the purposes of the distribution of the Shares;
provided, however, that the Company shall not be required to qualify as
a foreign corporation in any jurisdiction, and provided further that
the Company shall not be required to file a consent to service of
process in any jurisdiction in any action other than one arising out of
the offering or sale of the Shares.
(g) During the period of two years commencing on the Effective
Date, the Company will furnish to the Underwriters, in such quantity as
the Underwriters may reasonably request, (i) within 90 days after the
end of each fiscal year of the Company, either (A) a consolidated
balance sheet of the Company and its then consolidated subsidiaries,
and a separate balance sheet of each subsidiary of the Company, the
accounts of which are not included in such consolidated balance sheet,
as of the end of such fiscal year, and consolidated statements of
operations, cash flows and changes in shareholders' equity of the
Company and its then consolidated subsidiaries, and separate statements
of operations, cash flows and changes in shareholders' equity of each
of the subsidiaries of the Company, the accounts of which are not
included in such consolidated statements, for the fiscal year then
ended, all in reasonable detail, prepared in accordance with generally
accepted accounting principles, consistently applied, and all certified
by independent accountants (within the meaning of the Act and the Rules
and Regulations), or (B) the Company's Form 10-K (or Form 10-KSB) for
such fiscal year as filed with the Commission in accordance with the
Exchange Act; (ii) within 45 days after the end of each of the first
three fiscal quarters of each fiscal year, either (A) similar balance
sheets as of the end of such fiscal quarter and similar statements of
operations, cash flows and changes in shareholders' equity for the
fiscal quarter then ended, all in reasonable detail, and all certified
by the Company's principal financial officer or the Company's principal
accounting officer as having been prepared in accordance with generally
accepted accounting principles, consistently applied, or (B) the
Company's Form 10-Q (or Form 10-QSB) for such fiscal quarter as filed
with the Commission in accordance with the Exchange Act; (iii) as soon
as available, each report and each proxy or information statement
furnished to or filed with the Commission, any securities exchange or
the National Association of Securities Dealers, Inc. (the "NASD") and
each report and financial statement furnished to the Company's
shareholders generally; and (iv) any material reports filed by the
Company in connection with the quotation of its Common Shares on The
Nasdaq Stock Market or any listing on any stock exchange.
(h) Counsel for the Company, the Company's Accountants, the
Selling Shareholders and the officers of the Company will respectively
furnish the opinions, the letters and the certificates referred to in
subsections (e), (f), (g), (h), (i) and (j) of Section 9 hereof, and,
in the event that the Company shall file any amendment to the
Registration Statement relating to the offering of the Shares or any
amendment or supplement to the
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<PAGE> 21
Prospectus relating to the offering of the Shares subsequent to the
Effective Date, whether pursuant to subsection (c) of this Section 7 or
otherwise, such counsel, such accountants, such shareholders and such
officers will, at the time of such filing or at such subsequent time as
you shall specify, respectively furnish to you such opinions, letters
and certificates, each dated the date of its delivery, of the same
nature as the opinions, letters and certificates referred to in
subsections (e), (f), (g), (h), (i) and (j) of Section 9 hereof, as you
may reasonably request.
(i) Prior to the expiration of the Option, the Company will
not issue, directly or indirectly, without first consulting with you
and Counsel for the Underwriters, any press release or other
communication or hold any press conference with respect to the Company
or its activities or the offering contemplated hereby.
(j) Except as described in the Prospectus or as contemplated
by this Agreement, the Company and the Selling Shareholders shall not,
without your prior written consent, sell, contract to sell or otherwise
dispose of any Common Shares, or any securities convertible into Common
Shares, for a period of 120 days after the Effective Date, other than
the grant of options pursuant to the Stock Option Plan. In connection
with the execution of this Agreement, the Company shall deliver to you
the written agreement of each of the directors or executive officers of
the Company who are not Selling Shareholders and of each Selling
Shareholder to the effect that such person shall not, without your
prior written consent, for a period of 120 days after the Effective
Date, offer, sell, contract to sell, or grant any option to purchase or
otherwise dispose of any Common Shares or any securities convertible
into or exchangeable for Common Shares.
(k) The Company will not at any time, directly or indirectly,
take any action designed to, which will constitute or which might
reasonably be expected to cause or result in the stabilization of the
price of the Shares to facilitate the sale or resale of the Shares.
(l) After the Closing Time and the Option Exercise Time, the
Company and the Bank will be and remain in compliance with the
financial record-keeping requirements and internal accounting control
requirements of Section 13(b)(2) of the Exchange Act.
(m) The Company and the Bank will take such actions and
furnish such information as reasonably requested by the Underwriters in
order for the Underwriters to ensure compliance with the NASD's
"Interpretation Relating to Free-Riding and Withholding."
(n) Not later than the 45th day following the end of the
fiscal quarter first occurring after the first anniversary of the
Effective Date, the Company will make generally available to its
securities holders and deliver to you an earnings statement (which need
not be audited) covering a period of at least 12 months beginning not
earlier
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<PAGE> 22
than the Effective Date, which shall satisfy the provisions of Section
11(a) of the Act and/or Rule 158 promulgated under the Act.
(o) The Company shall deliver to you a Power of Attorney for
each Selling Shareholder, except John D. Kidd, and a Custody Agreement
for each Selling Shareholder at or before the execution of this
Agreement.
8. Expenses. The Selling Shareholders will pay and bear all costs,
fees, taxes and expenses incident to the performance of the obligations of the
Company under this Agreement including, but not limited to: (a) costs incident
to the preparation, printing and filing under the Act of each Preliminary
Prospectus, the Prospectus, the Registration Statement and any amendments
thereto, supplements thereof and exhibits thereto; (b) the costs of printing and
distributing to the Underwriters and any Selected Dealers copies of any
Preliminary Prospectus, the Prospectus, the Registration Statement and any
amendment thereto or supplement thereof required by this Agreement or the Act;
(c) the costs of preparing, printing, mailing, delivering, filing and
distributing preliminary and final Blue Sky memoranda, Underwriter's
Questionnaires and Powers of Attorney, the Selected Dealer Agreement, this
Agreement and all documents related thereto; (d) the filing fees of the
Commission; (e) the costs of qualification or registration of the Shares in the
jurisdictions referred to in Section 7(f) hereof, including the legal fees and
expenses of Counsel for the Underwriters in connection therewith, not to exceed
$5,000, and all filing fees in connection therewith; (f) the cost of preparation
of all filings with the NASD and all filing fees in connection therewith; (g)
fees and expenses of Counsel for the Company, the Company's Accountants and the
Company's consultants; (h) fees and expenses of the Company's registrar and
transfer agent, including the cost of supplying share certificates representing
Common Shares; and (i) all costs and expenses incurred or to be incurred by the
Company in connection with the transactions contemplated by this Agreement. If
the Firm Shares are not sold to the Underwriters by reason of any failure,
refusal or inability on the part of the Selling Shareholders to perform any
agreement on their part to be performed hereunder or to fulfill any condition of
the Underwriters' obligations hereunder, or if you shall terminate this
Agreement pursuant to Section 11(a) hereof, the Selling Shareholders, jointly
and severally, shall promptly reimburse you for all reasonable expenses actually
incurred by you in contemplation of the performance by the Company of its
obligations hereunder, including but not limited to the fees and disbursements
of Counsel for the Underwriters, the Underwriters' reasonable printing and
traveling expenses and postage, telegraph, telecopy and telephone charges
relating directly to the offering contemplated by the Prospectus, and also
including reasonable advertising expenses of the Underwriters incurred after the
Effective Date, up to a maximum of $45,000.
9. Conditions of the Underwriters' Obligations. The Underwriters'
obligations hereunder to purchase and pay for the Shares are subject (as of the
date hereof, the Closing Time and the Option Exercise Time) to the accuracy of
and compliance with the representations and warranties of the Company herein and
in each certificate and document contemplated under this Agreement to be
delivered, to the performance by the Company of its covenants and agreements
hereunder and under each such certificate and document, and to the following
additional conditions:
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<PAGE> 23
(a)(i) The Registration Statement shall have become effective
not later than 5:00 p.m., Cleveland time, on the date of this
Agreement, or at such later time or on such later date as you may agree
to in writing; (ii) if required, the Prospectus shall have been filed
with the Commission pursuant to Rule 424(b)(1) or (4) of the Rules and
Regulations within the applicable time period prescribed for such
filing thereunder and in accordance with the provisions of Section 7(b)
hereof; (iii) at or prior to the Closing Time or the Option Exercise
Time, as the case may be, no stop order suspending the effectiveness of
the Registration Statement or the qualification or registration of the
Shares under the Blue Sky laws of any jurisdiction shall have been
issued and no proceeding for that purpose shall have been initiated or
shall be threatened or contemplated by the Commission or the
authorities of any such jurisdiction; (iv) any request for additional
information on the part of the Commission or any such authorities shall
have been complied with to the satisfaction of the Commission or such
authorities and to the reasonable satisfaction of Counsel for the
Underwriters; (v) the NASD, upon review of the terms of the public
offering of Shares, shall not have objected to such offering, such
terms, or the Underwriters' participation in the same; and (vi) after
the date hereof, no amendment or supplement to the Registration
Statement or the Prospectus shall have been filed without your prior
consent.
(b) You shall not have advised the Company that the
Registration Statement or the Prospectus or any amendment thereof or
supplement thereto, in your reasonable judgment after conferring with
Counsel for the Underwriters, contains an untrue statement of a fact
which is material or omits to state a fact which is material and is
required to be stated therein or is necessary to make the statements
therein, in the light of the circumstances under which they were made,
not misleading.
(c) Between the time of the execution and delivery of this
Agreement and the Closing Time or the Option Exercise Time, as the case
may be, there shall be no litigation instituted against the Company,
any Subsidiary, any of their officers or directors or the Selling
Shareholders, and between such dates there shall be no proceeding
instituted or threatened against the Company, any Subsidiary, any of
their officers or directors or the Selling Shareholders, before or by
any federal, state, county or local commission, regulatory body,
administrative agency or other governmental body, domestic or foreign,
in which litigation or proceeding an unfavorable ruling, decision or
finding would, in the judgment of the Underwriters, have a Material
Adverse Effect or would materially and adversely affect the ability of
the Company or the Selling Shareholders to perform their obligations
under this Agreement.
(d) Each of the representations and warranties of the Company
and the Selling Shareholders contained herein and in each certificate
and document contemplated under this Agreement to be delivered shall be
true and correct at the Closing Time and the Option Exercise Time as if
made at the Closing Time or the Option Exercise Time, as the case may
be, and all covenants and agreements contained herein, and in each such
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<PAGE> 24
certificate and document, to be performed on the part of the Company
and all conditions contained herein and in each such certificate and
document to be fulfilled or complied with by the Company at or prior to
the Closing Time or the Option Exercise Time, as the case may be, shall
have been duly performed, fulfilled or complied with.
(e) At the Closing Time and the Option Exercise Time, Counsel
for the Company shall furnish to you an opinion, in form and substance
reasonably satisfactory to you and Counsel to the Underwriters, dated
as of the date of its delivery, to the effect that:
(i) The Company is a corporation duly organized,
validly existing and in good standing under the laws of the
State of Ohio. The Company has the power and authority
(corporate, governmental, regulatory and otherwise) and has or
will have all necessary Authorizations to own or lease all of
the assets owned or leased by it and to conduct its business
as described in the Registration Statement and the Prospectus,
except where the failure to have any Authorization would not
have a Material Adverse Effect. The Company is duly licensed
or qualified to do business and in good standing as a foreign
corporation in all jurisdictions (i) in which the nature of
the activities conducted by the Company requires such
qualification and (ii) in which the Company owns or leases
real property, except where the failure to be so licensed or
qualified would not have a Material Adverse Effect. The
Subsidiaries are the only subsidiaries of the Company.
(ii) The Bank is a bank duly organized, validly
existing and in good standing under the laws of the State of
Ohio. The deposit accounts of the Bank are insured up to
applicable limits by the FDIC and, to the knowledge of such
counsel, no proceedings for the termination or revocation of
such insurance are pending or threatened. The Bank has the
power and authority (corporate, governmental, regulatory and
otherwise) and has or will have all necessary Authorizations
to own or lease all of the assets owned or leased by it and to
conduct its business as described in the Registration
Statement and the Prospectus, except where the failure to have
any Authorization would not have a Material Adverse Effect.
The Bank is duly licensed or qualified to do business and in
good standing as a foreign corporation in all jurisdictions
(i) in which the nature of the activities conducted by the
Bank requires such qualification and (ii) in which the Bank
owns or leases real property, except where the failure to be
so licensed or qualified would not have a Material Adverse
Effect.
(iii) The Company has the corporate power and
authority to enter into this Agreement and to consummate any
other transaction contemplated by this Agreement.
(iv) This Agreement has been duly authorized by all
necessary
24
<PAGE> 25
corporate action on the part of the Company. This Agreement
has been duly executed and delivered by the Company and,
assuming due authorization, execution and delivery by you, is
a valid and binding agreement of the Company, enforceable in
accordance with its terms, subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar
laws of general applicability relating to or affecting
creditors' rights and to general equity principles, except as
rights to indemnity and contribution hereunder may be limited
by applicable law.
(v) To the knowledge of such counsel and except as
disclosed in the Prospectus, neither the Company nor the Bank
is in material violation of any rule or regulation of the
Federal Reserve, the Division or the FDIC which might have a
Material Adverse Effect. To the knowledge of such counsel,
neither the Company nor the Bank is subject to any written
directive from the Federal Reserve, the Division or the FDIC
to make any material change in the method of conducting its
business or affairs. Except as set forth or incorporated by
reference in the Prospectus, to the knowledge of such counsel,
there is not pending or threatened any litigation, charge,
investigation, action, suit or other proceeding before or by
any court, regulatory authority or governmental agency or body
which would affect the performance of the terms and conditions
of this Agreement or the consummation of the transactions
contemplated hereby or which would have a Material Adverse
Effect.
(vi) The authorized capital stock of the Company is
as set forth or incorporated by reference in the Prospectus.
The issued and outstanding Common Shares have been duly
authorized and validly issued, are fully paid and
nonassessable, and have not been issued in violation of any
preemptive right.
(vii) The issued and outstanding shares of capital
stock of the Bank have been duly authorized and validly
issued, are fully paid and nonassessable and are owned by the
Company free and clear of any liens, charges, encumbrances or
restrictions, except as set forth or incorporated by reference
in the Prospectus.
(viii) To such counsel's knowledge, no holders of
Common Shares or other securities of the Company have
registration rights with respect to securities of the Company
because of the filing or effectiveness of the Registration
Statement.
(ix) The terms and provisions of the Common Shares
and the Shares conform in all material respects to the
description thereof contained or incorporated by reference in
the Registration Statement and Prospectus, and the forms of
certificates evidencing the Common Shares and the Shares
comply with the Ohio General Corporation Law.
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(x) The execution and delivery of this Agreement and
the consummation of the transactions herein contemplated did
not and will not (A) violate or conflict with the respective
Articles of Incorporation or the Code of Regulations of the
Company or the Bank, (B) violate, conflict with or constitute
a breach of, or a default (or an event which, with notice or
lapse of time, or both, would constitute a default) under any
agreement, indenture or other instrument to which the Company
or the Bank is a party, (C) result in a breach or violation of
any of the terms and provisions of, or constitute a default
(or give rise to a state of facts which, with notice or lapse
of time, or both, would constitute a default) under or result
in the creation or imposition of any lien, charge or
encumbrance upon the assets or properties of the Company or
the Bank, pursuant to any indenture, mortgage, deed of trust,
voting trust agreement, loan agreement, letter of credit
agreement, bond, debenture, note agreement or other evidence
of indebtedness, lease, contract or other agreement or
instrument known to such counsel to which the Company or the
Bank is a party or by which the Company, the Bank or any of
their respective properties are bound, or (D) violate or
conflict with any governmental license or permit known to such
counsel, or any law, administrative regulation or
authorization, or any approval, court decree, injunction or
order known to such counsel; except such breaches, violations
or defaults as would not have a Material Adverse Effect;
provided, however, that no opinion need be rendered concerning
state securities or Blue Sky laws.
(xi) The Registration Statement has become effective
under the Act and (A) to such counsel's knowledge, no stop
order suspending the effectiveness of the Registration
Statement has been issued, (B) no proceedings for that purpose
have been instituted or, to such counsel's knowledge, are
pending or threatened under the Act, and (C) all filings
required by Rule 424 and, if applicable, Rule 430A, of the
Rules and Regulations have been made.
(xii) Each of the Registration Statement and the
Prospectus, and each amendment or supplement thereto (other
than the financial statements, financial data and supporting
schedules included in such Registration Statement or
Prospectus, as to which such counsel need express no opinion),
as of the effective date of the Registration Statement,
complied as to form with the requirements of the Act and the
applicable Rules and Regulations, and all written decisions
and orders of the Commission, as the case may be (except as to
information with respect to the Underwriters and except as to
financial statements, notes to financial statements, financial
tables and other financial and statistical data included
therein, as to which no opinion need be expressed). To the
knowledge of such counsel, all documents and exhibits required
to be filed with the Registration Statement (in each case as
amended or supplemented, if so amended or supplemented) have
been so filed. The description in the Registration Statement
of such documents and exhibits is accurate in all material
respects and presents fairly the information required to be
shown. To the knowledge of such counsel,
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<PAGE> 27
there are no contracts or other documents of a character
required to be described in the Registration Statement or the
Prospectus which are not described. There are no statutes or
regulations applicable to the Company or any Subsidiary of a
character required to be disclosed in the Registration
Statement or the Prospectus which have not been so disclosed
and properly described therein. To the knowledge of such
counsel, there are no certificates, permits or other
authorizations from governmental regulatory officials or
bodies required to be obtained or maintained by, or legal or
governmental proceedings, past, pending or threatened, against
the Company or any Subsidiary of a character required to be
disclosed in the Registration Statement or the Prospectus
which have not been so disclosed and properly described
therein. The Company complies with the conditions permitting
its use of Form S-3
(xiii) Each document filed pursuant to the Exchange
Act and incorporated by reference in the Prospectus, when so
filed, complied as to form, in all material respects, with the
Exchange Act and the applicable rules and regulations
thereunder.
(xiv) The description of contracts or other documents
in the Registration Statement and the Prospectus are accurate
in all material respects and fairly present the information
required by the Act or the Rules and Regulations to be
presented. To such counsel's knowledge, there are no contracts
or other documents of a character required to be described or
referred to in the Registration Statement or Prospectus or to
be filed as an exhibit to the Registration Statement that are
not described or referred to therein and filed as required.
(xv) No approval of any regulatory, supervisory or
other public authority is required in connection with the
execution and delivery of this Agreement, except (i) the
declaration of effectiveness of the Registration Statement and
any required post-effective amendment to the Registration
Statement by the Commission, (ii) as may be otherwise required
under the securities laws of various jurisdictions, and (iii)
as may be required under the rules and regulations of the
NASD.
(xvi) The statements in the Prospectus under the
captions "RISK FACTORS - Control by Management; Anti-Takeover
Provisions," and "RISK FACTORS - Holding Company Structure;
Government Regulations and Policies," insofar as they refer to
statements of law or legal conclusions, have been prepared or
reviewed by such counsel and are correct in all material
respects.
(xvii) Neither the Company nor any Subsidiary is an
"investment company" as defined in Section 3(a) of the
Investment Company Act and, if the Company and the
Subsidiaries conduct their respective businesses as set forth
in the Registration Statement and the Prospectus, none will
become an "investment
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<PAGE> 28
company" or be required to register under the Investment
Company Act.
(xviii) All issuances and sales by the Company of its
securities during the past three years were either (a)
registered under the Act or (b) exempt from registration under
the Act and, to such counsel's knowledge, otherwise complied
in all respects with the provisions of all applicable federal
and state securities laws.
(xix) This Agreement has been duly authorized,
executed and delivered by or on behalf of each Selling
Shareholder. The Agent and the Custodian for the Selling
Shareholders has been duly and validly authorized to carry out
all transactions contemplated herein on behalf of the Selling
Shareholders. The performance of this Agreement and the
consummation of the transactions herein contemplated by the
Selling Shareholders will not result in a breach or violation
of any of the terms and provisions of, or constitute a default
under, any statute, any indenture, mortgage, deed of trust,
note agreement or other agreement or instrument to which any
of the Selling Shareholders is known by such counsel to be a
party or to be bound or to which any of the property of the
Selling Shareholders is known by such counsel to be subject,
or violate any order, rule or regulation of any court or
governmental agency or body having effect on the date of such
opinion and known by such counsel as having jurisdiction over
any of the Selling Shareholders or any of their properties. To
such counsel's knowledge, no consent, approval, authorization
or order of any court or governmental agency or body is
required for the consummation of the transactions contemplated
by this Agreement in connection with the sale of Shares
hereunder, except such as have been obtained under the Act and
such as may be required under applicable Blue Sky laws in
connection with the purchase and distribution of such Shares
by the Underwriters and the clearance of such offering with
the NASD.
(xx) Each of the Selling Shareholders has full right,
power and authority to enter into this Agreement, to execute
the Power of Attorney and the Custody Agreement and to sell,
transfer and deliver the Shares to be sold at the Closing Time
by such Selling Shareholder hereunder and, to the knowledge of
such counsel, good title to such Shares so sold, free and
clear of all voting trust or buy-sell arrangements, liens,
encumbrances, equities, claims, restrictions and community
property rights whatsoever, has been transferred to the
Underwriter who has purchased such Shares hereunder.
(xxi) This Agreement is a legal, valid and binding
agreement of each of the Selling Shareholders, enforceable in
accordance with its terms, subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar
laws of general applicability relating to or affecting
creditors' rights and to general equity principles, except as
rights to indemnity and contribution hereunder may be limited
by applicable law.
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<PAGE> 29
(xxii) Such counsel has participated in the
preparation of the Registration Statement and the Prospectus,
including review and discussion of the contents thereof
(including review and discussion of the contents of all
documents incorporated by reference therein), and nothing has
come to the attention of such counsel that has caused them to
believe that the Registration Statement (including the
documents incorporated by reference therein) at the time the
Registration Statement became effective, contained an untrue
statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under
which they were made, not misleading, or the Prospectus, as of
its date and as of the Closing Date or the Option Exercise
Time, as the case may be, or any supplement to the Prospectus,
as of its respective date, and as of the Closing Date or the
Option Exercise Time, as the case may be, contained any untrue
statement of a material fact or omitted to state a material
fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not
misleading (it being understood that such counsel need express
no opinion with respect to the financial statements and the
notes thereto and the schedules and other financial and
statistical data included in the Registration Statement or the
Prospectus, or any document incorporated by reference
therein).
In rendering the opinions and confirmations set forth above, such
counsel may rely (as to matters of fact) upon certificates of the
Selling Shareholders and responsible officers of the Company and of the
transfer agent and certificates of public officials, provided copies of
such certificates are delivered to the Underwriters. In such opinions,
references to "knowledge," "conferences," "investigations" or "document
review" may refer to the actual knowledge (or knowledge based on
certificates) and conscious awareness of facts or other information of
the individual lawyers who were actively involved in the transactions
contemplated in this Agreement and in the preparation of the documents
involved and the opinion letters.
(f) Concurrently with the execution and delivery of this
Agreement and at the Closing Time and at the Option Exercise Time, the
Company's accountants shall have furnished to you a letter, dated as of
the date of its delivery, addressed to you and in form and substance
reasonably satisfactory to you, to the effect that:
(i) Such accountants are independent certified public
accountants with respect to the Company as required by the Act
and the Rules and Regulations.
(ii) In their opinion, the financial statements and
schedules and notes examined by them and included or
incorporated by reference in the Registration Statement and
the Prospectus comply as to form in all material respects with
the applicable accounting requirements of the Act and the
Rules and Regulations with respect to registration statements
on Form S-3.
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<PAGE> 30
(iii) On the basis of inquiries and procedures
conducted by them, including a reading of the latest available
unaudited interim financial statements of the Company,
inquiries of officials of the Company and the Bank responsible
for operational, financial and accounting matters, a reading
of the minute books of the Company and the Bank, a reading of
the latest available interim unaudited consolidated financial
statements of the Company and the Bank (with an indication of
the date thereof) and other specified procedures and
inquiries, nothing has come to their attention that caused
them to believe that (A) the historical amounts in "Selected
Consolidated Financial Information" included in the
Registration Statement do not agree with or are not derivable
from corresponding amounts in the consolidated financial
statements from which such amounts were derived; (B) the
unaudited financial statements of the Company set forth or
incorporated by reference in the Registration Statement and
the Prospectus do not comply as to form in all material
respects with the applicable accounting requirements of the
Act and the Rules and Regulations or are not fairly presented
in conformity with generally accepted accounting principles
applied on a basis consistent with that of the audited
financial statements; and (C) during the period April 1, 1998,
to a specified date no more than five days prior to the date
thereof, in the case of the first letter, and not more than
two business days prior to the date thereof in the case of any
subsequent letters, there was any change in the capital stock
or debt (other than normal payments) of the Company and the
Bank on a consolidated basis, or any decrease in the
shareholders' equity of the Company and the Bank on a
consolidated basis, each as compared with the amounts shown in
the balance sheet as of March 31, 1998, included in the
Registration Statement or incorporated by reference therein or
any decrease from March 31, 1998, to the specified date, on a
proportional basis with the corresponding period for the
preceding year, in revenues, net income and net income per
share of the Company and the Bank on a consolidated basis,
except in all instances for changes, decreases or increases
which the Registration Statement and the Prospectus disclose
have occurred or may occur and except for such other changes,
decreases or increases which you shall in your sole discretion
accept.
(iv) In addition to their examination referred to in
their reports included in the Registration Statement and the
Prospectus and the inquiries and limited procedures referred
to in clause (iii) above, they have performed other
procedures, not constituting an audit, with respect to certain
numerical data and financial information appearing in the
Registration Statement and the Prospectus, requested by you
and specified in such letter and have compared such data and
information with the accounting records of the Company and
found them to be in agreement.
(g) At the Closing Time and at the Option Exercise Time, there
shall be furnished to you, on behalf of the Company, a certificate,
dated the date of its delivery, signed by both the chief executive
officer and the chief financial officer of the Company,
30
<PAGE> 31
in form and substance reasonably satisfactory to you, to the effect
that:
(i) Each signer of such certificate has carefully
examined the Registration Statement and the Prospectus and the
documents incorporated by reference therein and (A) to his
knowledge, as of the date of such certificate and as of the
Effective Date, the statements in the Registration Statement
and the Prospectus and the documents incorporated by reference
therein are and were true and correct in all material
respects, and neither the Registration Statement nor the
Prospectus nor such document incorporated by reference omits
to state a material fact required to be stated therein or
necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading;
(B) since the Effective Date, no event has occurred of which
he has knowledge and which was required by the Act or the
Rules and Regulations to be set forth in a supplement to or
amendment of the Prospectus but which has not been so set
forth; and (C) since the dates as of which and the periods for
which information is given in the Registration Statement and
the Prospectus, there has not been to his knowledge any change
which would have a Material Adverse Effect, other than changes
which the Registration Statement and the Prospectus
specifically disclose have occurred or may occur subsequent to
the Effective Date.
(ii) No stop order suspending the effectiveness of
the Registration Statement has been issued, and no proceedings
for such purpose have been commenced or are, to the knowledge
of each signer of such certificate, threatened or contemplated
by the Commission.
(iii) The Company has not received notice that any
stop order suspending the qualification by registration of any
of the Shares under the Blue Sky laws of any jurisdiction has
been issued, or that any proceedings for such purpose have
been commenced, and, to the knowledge of each signer of such
certificate, no such proceedings are threatened or
contemplated by any jurisdiction.
(iv) Each of the representations and warranties of
the Company contained in this Agreement and in each
certificate and document contemplated under this Agreement to
be delivered to you was, when originally made and is, at the
time such certificate is dated, true and correct.
(v) Each of the covenants required herein to be
performed by the Company on or prior to the date of such
certificate has been duly, timely and fully performed and each
condition herein required to be complied with by the Company
on or prior to the date of such certificate has been duly,
timely and fully complied with by the Company.
(h) The Company shall have furnished to you such certificates,
in addition to
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<PAGE> 32
those specifically mentioned herein, as you may have reasonably
requested in a timely manner as to (i) the accuracy and completeness,
at the Closing Time and the Option Exercise Time, of any statement in
the Registration Statement or the Prospectus, (ii) the accuracy, at the
Closing Time and the Option Exercise Time, of the representations and
warranties of the Company herein and in each certificate and document
contemplated under this Agreement to be delivered to you, (iii) the
performance by the Company of its obligations hereunder and under each
such certificate and document, and (iv) the fulfillment of the
conditions concurrent and precedent to your obligations hereunder.
(i) At the Closing Time, there shall be furnished to you
certificates, dated the date of their delivery, from and signed by each
of the Selling Shareholders, in form and substance reasonably
satisfactory to you, to the effect that:
(i) Each of the representations and warranties of
each such Selling Shareholder contained in this
Agreement, and in each certificate and document
contemplated under this Agreement to be delivered to
you, was, when originally made, and is, at the time
such certificate is dated, true and correct.
(ii) Each of the covenants required herein, or in the
Power of Attorney and the Custody Agreement, to be
performed by each such Selling Shareholder on or
prior to the date of such certificate has been duly,
timely and fully performed, and each condition herein
required, or required in the Power of Attorney and
the Custody Agreement, to be complied with by each
such Selling Shareholder on or prior to the date of
such certificate has been duly, timely and fully
complied with by such Selling Shareholder.
(j) The executive officers and directors of the Company and
the Selling Shareholders shall have entered into agreements with the
Underwriters and the Company to the effect that they will not sell,
contract to sell or otherwise dispose of any Common Shares or any
securities convertible into Common Shares for a period of 120 days
after the Effective Date, except with the prior written consent of the
Company and the Underwriters.
(k) Except as contemplated by the Registration Statement and
the Prospectus, since the date hereof there shall not have been any
change in the capitalization of the Company or any change which would
have a Material Adverse Effect, arising for any reason whatsoever.
(l) All corporate proceedings and other legal matters relating
to the sale and transfer of the Shares, this Agreement, the
Registration Statement, the Prospectus and other related matters shall
be reasonably satisfactory in all material respects to Counsel for the
Underwriters, who shall have furnished to you, at the Closing Time and
Option Exercise Time, such opinion, in form and substance reasonably
satisfactory to you, with
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<PAGE> 33
respect to the sufficiency of the aforementioned corporate proceedings
and other legal matters as you may reasonably require.
(m) Counsel for the Underwriters shall have been furnished
such documents as they reasonably may require for the purpose of
enabling them to review or pass upon the matters required by the
Underwriters and for the purpose of evidencing the accuracy,
completeness or satisfaction of any of the representations, warranties
or conditions herein contained, including, but not limited to,
resolutions of the Board of Directors of the Company regarding the
authorization of this Agreement and the transactions contemplated
hereby.
(n) Prior to and at the Closing Time and the Option Exercise
Time, in the reasonable opinion of the Underwriters: (i) there shall
have been no material adverse change in the financial or other
condition of the Company and the Bank, taken as a whole, from that as
of the latest date as of which such condition is set forth or
incorporated by reference in the Prospectus; (ii) there shall have been
no material transaction entered into by the Company or any Subsidiary,
from the latest date as of which the financial condition of the Company
or the Bank is set forth or incorporated by reference in the
Prospectus, other than transactions referred to or contemplated therein
and transactions in the ordinary course of business; (iii) neither the
Company nor the Bank shall have received from the Federal Reserve, the
Division or FDIC any direction (oral or written) to make any material
change in the method of conducting their respective businesses which
would have a Material Adverse Effect; (iv) no action, suit or other
proceeding, at law or in equity, or before or by any federal or state
commission, board or other administrative agency, or before any
arbitrator or arbitrators, shall be pending or threatened against the
Company or any Subsidiary or affecting any of their respective assets
wherein an unfavorable decision, ruling or finding would have a
Material Adverse Effect (provided that for this Section 9(n), the
Underwriters shall not regard any proceeding to be "threatened" unless
a potential party has manifested to the management of the Company or
the Bank or to Counsel for the Company a present intention to initiate
a proceeding); and (v) the Shares shall have been qualified or
registered for offering and sale (or exempt from such requirements) by
the Company under the securities or Blue Sky laws of each jurisdiction
upon which the Underwriters and the Company shall have agreed.
(o) The Company shall have furnished to you a certificate
dated at the Effective Date, signed by both the chief executive officer
and the chief financial officer of the Company, in form and substance
reasonably satisfactory to you, to the effect that the Company
continues to expect that net income after taxes for the year ending
December 31, 1998 will be at least $1.20 per share.
All of the opinions, letters, evidence and certificates mentioned above
or elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance reasonably satisfactory
to Counsel for the Underwriters. You reserve the
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<PAGE> 34
right to waive any condition hereinabove set forth. If any condition of the
Underwriters' obligations hereunder to be satisfied prior to the Closing Time or
the Option Exercise Time is not so satisfied, this Agreement may be terminated
by you prior to the Closing Time or the Option Exercise Time, as applicable, by
notice in writing or by telegram confirmed in writing to the Company.
10. Indemnification and Contribution.
(a) The Company agrees to indemnify and hold harmless each of
the Underwriters and each person who controls any of the Underwriters
within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act, from and against any and all losses, claims, damages,
liabilities or actions, joint or several (including any investigation,
legal or other expense reasonably incurred in connection with, and any
amount paid in settlement of, any commenced or threatened action, suit
or proceeding or any claim asserted), to which any of the Underwriters
or any such controlling person may become subject under the Act, the
Exchange Act or otherwise, but only insofar as such losses, claims,
damages, liabilities or actions arise out of, or are based upon:
(i) any misrepresentation by the Company or a Selling
Shareholder in this Agreement, including, but not limited to,
the breach of, or any inaccuracy in, the representations and
warranties of the Company or the Selling Shareholders
contained in this Agreement or any certificate or other
document contemplated by this Agreement or any failure of the
Company or the Selling Shareholders to perform their
obligations and covenants under this Agreement; or
(ii) any untrue statement or alleged untrue statement
of a material fact contained in the Registration Statement,
any Preliminary Prospectus, the Prospectus, any document
incorporated by reference therein or any amendment thereof or
supplement thereto or in any application or other document
executed by the Company or a Selling Shareholder based upon
written information furnished by or on behalf of the Company
or a Selling Shareholder and filed in any jurisdiction in
order to register or qualify the Shares under the securities
laws thereof or filed with the Commission, or the omission or
alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein,
in the light of the circumstances under which they were made,
not misleading; provided, however, that the indemnity
agreement contained in this Section 10(a) shall not extend to
any Underwriter in respect of any such losses, claims,
damages, liabilities or actions arising out of, or based upon,
any such untrue statement or alleged untrue statement or any
such omission or alleged omission, if such statement or
omission was made in reliance upon information furnished in
writing to the Company through you or on behalf of you
specifically for use in connection with the preparation of the
Registration Statement, any Preliminary Prospectus or the
Prospectus or any amendment thereof or supplement thereto and,
provided further, that the indemnity agreement provided
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<PAGE> 35
in this Section 10(a) with respect to any Preliminary
Prospectus shall not inure to the benefit of any Underwriter
from whom the person asserting any losses, claims, damages,
liabilities or actions based upon any untrue statement or
alleged untrue statement of material fact or omission or
alleged omission to state therein a material fact purchased
Shares, if a copy of the Prospectus in which such untrue
statement or alleged untrue statement or omission or alleged
omission was corrected has not been sent or given to such
person within the time required by the Act and the Rules and
Regulations thereunder, unless such failure is the result of
noncompliance by the Company with Section 6(a) hereof. The
Company agrees to pay any legal and other expenses for which
it is liable under this subsection (a) from time to time (but
not more frequently than monthly) within 30 days after its
receipt of a bill therefor.
(b) Each Selling Shareholder agrees, subject to the
limitations set forth in the following paragraph, jointly and
severally, to indemnify and hold harmless each of the Underwriters and
each person who controls any of the Underwriters within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act, from and
against any and all losses, claims, damages, liabilities or actions,
joint or several (including any investigation, legal or other expense
reasonably incurred in connection with, and any amount paid in
settlement of, any commenced or threatened action, suit or proceeding
or any claim asserted), to which any of the Underwriters or any such
controlling person may become subject under the Act, the Exchange Act
or otherwise, but only insofar as such losses, claims, damages,
liabilities or actions arise out of, or are based upon:
(i) any misrepresentation by the Company or a Selling
Shareholder in this Agreement, including, but not limited to,
the breach of, or any inaccuracy in, the representations and
warranties of the Company or the Selling Shareholders
contained in this Agreement or any certificate or other
document contemplated by this Agreement or any failure of the
Company or the Selling Shareholders to perform their
obligations and covenants under this Agreement; or
(ii) any untrue statement or alleged untrue statement
of a material fact contained in the Registration Statement,
any Preliminary Prospectus, the Prospectus, any document
incorporated by reference therein or any amendment thereof or
supplement thereto or in any application or other document
executed by the Company or a Selling Shareholder based upon
written information furnished by or on behalf of the Company
or a Selling Shareholder and filed in any jurisdiction in
order to register or qualify the Shares under the securities
laws thereof or filed with the Commission, or the omission or
alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein,
in the light of the circumstances under which they were made,
not misleading; provided, however, that the indemnity
agreement contained in this Section 10(b) shall not extend to
any Underwriter in respect of any such losses, claims,
damages, liabilities or actions arising out of, or based upon,
any such
35
<PAGE> 36
untrue statement or alleged untrue statement or any such
omission or alleged omission, if such statement or omission
was made in reliance upon information furnished in writing to
the Company through you or on behalf of you specifically for
use in connection with the preparation of the Registration
Statement, any Preliminary Prospectus or the Prospectus or any
amendment thereof or supplement thereto and, provided further,
that the indemnity agreement provided in this Section 10(b)
with respect to any Preliminary Prospectus shall not inure to
the benefit of any Underwriter from whom the person asserting
any losses, claims, damages, liabilities or actions based upon
any untrue statement or alleged untrue statement of material
fact or omission or alleged omission to state therein a
material fact purchased Shares, if a copy of the Prospectus in
which such untrue statement or alleged untrue statement or
omission or alleged omission was corrected has not been sent
or given to such person within the time required by the At and
the Rules and Regulations thereunder, unless such failure is
the result of noncompliance by the Company with Section 6(a)
hereof. The Selling Shareholders agree to pay any legal and
other expenses for which they are liable under this subsection
(b) from time to time (but not more frequently than monthly)
within 30 days after their receipt of a bill therefor.
(c) Each Underwriter agrees, severally and not jointly, to
indemnify and hold harmless the Company, its directors, its officers
who shall have signed the Registration Statement, each of the Selling
Shareholders and each person, if any, who controls the Company within
the meaning of Section 15 of the Act or Section 20 of the Exchange Act
(i) to the same extent as the foregoing indemnity from the Company and
the Selling Shareholders to each Underwriter, but in each case to the
extent, and only to the extent, that any statement in or omission from
or alleged omission from the Registration Statement, any Preliminary
Prospectus, the Prospectus or any amendment or supplement thereto was
made in reliance upon information furnished in writing to the Company
by such Underwriter specifically for use in connection with the
preparation of the Registration Statement, any Preliminary Prospectus
or the Prospectus or any amendment or supplement thereto, and (ii) to
the extent any such loss, claim, damage, liability or action arises out
of, or is based upon, a failure or alleged failure of such Underwriter
to deliver the Prospectus as required by applicable laws. Each
Underwriter agrees, severally and not jointly, to pay any legal and
other expenses for which it is liable under this subsection (c) from
time to time (but not more frequently than monthly) within 30 days
after receipt of a bill therefor.
(d) If any action is brought against a person entitled to
indemnification pursuant to the foregoing subsection (a), (b) or (c)
(an "indemnified party") in respect of which indemnity may be sought
against a person granting indemnification (an "indemnifying party")
pursuant to such subsections, such indemnified party shall promptly
notify such indemnifying party in writing of the commencement thereof;
provided, however, that the omission so to notify the indemnifying
party of any such action shall not release the indemnifying party from
any liability it may have to such
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<PAGE> 37
indemnified party otherwise than on account of the indemnity agreement
contained in subsection (a), (b) or (c) of this Section 10. In case any
such action is brought against an indemnified party and the indemnified
party notifies an indemnifying party of the commencement thereof, the
indemnifying party against which a claim is to be made will be entitled
to participate therein at its own expense and, to the extent that it
may wish, to assume at its own expense the defense thereof, with
counsel reasonably satisfactory to such indemnified party; provided,
however, that (i) if the defendants in any such action include both the
indemnified party and the indemnifying party, and the indemnified party
shall have reasonably concluded based upon the written advice of
counsel that there may be legal defenses available to it and/or other
indemnified parties which are different from or additional to those
available to the indemnifying party, the indemnified party shall have
the right to select separate counsel reasonably satisfactory to the
indemnifying party to assume such legal defenses and otherwise to
participate in the defense of such action on behalf of such indemnified
party or parties; and (ii) in any event, the indemnified party shall be
entitled to have counsel chosen by such indemnified party participate
in, but not conduct, the defense. Upon receipt of notice from the
indemnifying party to such indemnified party of its election so to
assume the defense of such action and approval by the indemnified party
of counsel, the indemnifying party will not be liable to such
indemnified party under this Section 10 for any legal or other expenses
subsequently incurred by such indemnified party in connection with the
defense thereof unless (A) the indemnified party shall have employed
such counsel in connection with the assumption of legal defenses in
accordance with proviso (i) to the next preceding sentence (it being
understood, however, that the indemnifying party shall not be liable
for the expenses of more than one separate counsel); (B) the
indemnifying party shall not have employed counsel reasonably
satisfactory to the indemnified party to represent the indemnified
party within a reasonable time after notice of commencement of the
action; or (C) the indemnifying party has authorized in writing the
employment of counsel for the indemnified party at the expense of the
indemnifying party. An indemnifying party shall not be liable for any
settlement of any action or proceeding effected without its written
consent.
(e) In order to provide for just and equitable contribution in
circumstances in which the indemnity agreement provided for in
subsection (a), (b) or (c) of this Section 10 is unavailable in
accordance with its terms, the Company and the Selling Shareholders
and, subject to the limitations set forth below, each of the
Underwriters shall contribute to the aggregate losses, claims, damages
and liabilities, of the nature contemplated by said indemnity agreement
(including any investigation, legal and other expenses incurred in
connection with, and any amount paid in settlement of, any action, suit
or proceeding or any claims asserted, but after deducting in the case
of losses, claims, damages, liabilities and expenses suffered any
contribution received by such party from persons, other than any
Underwriter, who may also be liable for contribution, including persons
who control the Company within the meaning of the Act, officers of the
Company who signed the Registration Statement, directors of the Company
and the Selling Shareholders) incurred by the Company, the Selling
Shareholders and the Underwriters, in such proportions as
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<PAGE> 38
are applicable to reflect the relative benefits received by the Company
and the Selling Shareholders, on the one hand, and the Underwriters, on
the other hand, from the offering of Shares; provided, however, that if
such allocation is not permitted by applicable law or if the
indemnified party failed to give the notice required under subsection
(d) of this Section 10, then the relative fault of the Company and the
Selling Shareholders, on the one hand, and the Underwriters, on the
other hand, in connection with the statements or omissions which
resulted in such losses, claims, damages and liabilities and other
relevant equitable considerations will be considered together with such
relative benefits. The relative benefits received by the Company and
the Selling Shareholders, on the one hand, and the Underwriters, on the
other hand, shall be deemed to be in such proportion as the total net
proceeds from the offering (before deducting expenses) received by the
Company and the Selling Shareholders bears to the total underwriting
discount received by the Underwriters, in each case as set forth in the
table on the cover page of the Prospectus and in the notes thereto. The
relative fault of the Company and the Selling Shareholders, on the one
hand, and of the Underwriters, on the other, shall be determined by
reference to, among other things, whether in the case of an untrue
statement or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact, such statement
or omission relates to information supplied by the Company, the Selling
Shareholders or by the Underwriters, and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent
such untrue statement or omission. The Company, the Selling
Shareholders and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this subsection (e) were
determined by pro-rata allocation or by any other method of allocation
that does not take account of the equitable considerations referred to
in this subsection (e). The amount paid or payable by the indemnified
party as a result of the losses, claims, damages or liabilities
referred to above in this subsection (e) shall be deemed to include any
legal or other expenses reasonably incurred by such indemnified party
in connection with investigating or defending against or appearing as a
third party witness in any such action or claim. Notwithstanding the
provisions of this subsection (e), (i) no Underwriter shall be required
to contribute any amount in excess of the amount by which the total
price at which the Shares purchased by it were offered to the public
exceeds the amount of any damages which such Underwriter has otherwise
been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission, and (ii) no person guilty of
fraudulent misrepresentation within the meaning of Section 11(f) of the
Act shall be entitled to contribution from any person who is not guilty
of such fraudulent misrepresentation. For purposes of this subsection
(e), each person, if any, who controls any Underwriter within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act
shall have the same rights to contribution as such Underwriter. Any
party entitled to contribution will, promptly after receipt of notice
of commencement of any action, suit or proceeding against such party in
respect of which a claim for contribution may be made against another
party or parties under this Section 10(e), notify such party or parties
from whom contribution may be sought, but the omission to so notify
such party or parties shall not relieve the party or parties from whom
contribution may be sought or they may have under this Section 10(e) or
otherwise. No party shall be liable
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<PAGE> 39
for contribution for any settlement of any action or claim effected
without its written consent.
(f) The respective indemnity and contribution agreements by
the Underwriters, the Selling Shareholders and the Company contained in
subsections (a), (b), (c), (d) and (e) of this Section 10, and the
respective covenants, representations and warranties of the Company or
the Selling Shareholders in Sections 2, 3, 4, 5, 6, 7 and 8 hereof
shall remain operative and in full force and effect regardless of (i)
any investigation made by any Underwriter, on its behalf or by or on
behalf of any person who controls such Underwriter, of the Company or
any controlling person of the Company, any director or officer of the
Company or any Selling Shareholder, (ii) acceptance of any of the
Shares and payment therefor, or (iii) with respect to Section 8 and
this Section 10 only, any termination of this Agreement, and shall
survive the delivery of the Shares, and any successor of any
Underwriter or the Company, or of any person who controls any
Underwriter or the Company, or of any Selling Shareholder, as the case
may be, shall be entitled to the benefit of such respective indemnity
and contribution agreements. The respective indemnity and contribution
agreements by the Underwriters, the Company and the Selling
Shareholders contained in subsections (a), (b), (c) and (d) of this
Section 10 shall be in addition to any liability which the
Underwriters, the Company and the Selling Shareholders may otherwise
have to the other.
11. Defaulting Underwriters.
(a) If any Underwriter shall default in its obligation to
purchase the Shares which it has agreed to purchase hereunder at the
Closing Time or the Option Exercise Time, as the case may be, the
Representatives may in their discretion arrange for the Representatives
or another party or other parties to purchase such Shares on the terms
contained herein. If within thirty-six hours after such default by any
Underwriter the Representatives do not arrange for the purchase of such
Shares, then the Selling Shareholders shall be entitled to a further
period of thirty-six hours within which to procure another party or
other parties reasonably satisfactory to the Representatives to
purchase such Shares on such terms. In the event that, within the
respective prescribed periods, the Representatives notify the Custodian
that they have so arranged for the purchase of such Shares, or the
Custodian notifies the Representatives that the Selling Shareholders
have so arranged for the purchase of such Shares, the Representatives
or the Selling Shareholders shall have the right to postpone either the
Closing Time or the Option Exercise Time, as the case may be, for a
period of not more than seven days, in order to effect whatever changes
may thereby be made necessary in the Registration Statement or the
Prospectus, or in any other documents or arrangements, and the Company
agrees to file promptly any amendment to the Registration Statement or
the Prospectus which in the opinion of the Representatives may thereby
be made necessary. The term "Underwriter" as used in this Agreement
shall include any person substituted under this Section with like
effect as if such person had originally been a party to this
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<PAGE> 40
Agreement with respect to such Shares.
(b) If, after giving effect to any arrangements for the
purchase of the Shares of a defaulting Underwriter or Underwriters by
the Representatives and the Selling Shareholders as provided in
subsection (a) above, the aggregate number of such Shares which remains
unpurchased does not exceed 10% of the aggregate number of all the
Shares to be purchased at either the Closing Time or the Option
Exercise Time, as the case may be, then the Selling Shareholders shall
have the right to require each non-defaulting Underwriter to purchase
the number of Shares which such Underwriter agreed to purchase
hereunder at either the Closing Time or the Option Exercise Time, as
the case may be, and, in addition, to require each non-defaulting
Underwriter to purchase its pro rata share (based on the number of
Shares which such Underwriter agreed to purchase hereunder) of the
Shares of such defaulting Underwriter or Underwriters for which such
arrangements have not been made; but nothing herein shall relieve a
defaulting Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the
purchase of the Shares of a defaulting Underwriter or Underwriters by
the Representatives and the Selling Shareholders as provided in
subsection (a) above, the aggregate number of such Shares which remains
unpurchased exceeds 10% of the aggregate number of all the Shares to be
purchased at, or if the Selling Shareholders shall not exercise the
right described in subsection (b) above to require non-defaulting
Underwriters to purchase Shares of a defaulting Underwriter or
Underwriters at either the Closing Time or the Option Exercise Time, as
the case may be, then this Agreement shall thereupon terminate, without
liability on the part of any non-defaulting Underwriter or the Selling
Shareholders, except for the expenses to be borne by the Selling
Shareholders and the Underwriters as provided in Section 8 hereof and
the indemnity and contribution agreements in Section 10 hereof; but
nothing herein shall relieve a defaulting Underwriter from liability
for its default.
12. Termination. This Agreement (except for the provisions of Sections
8 and 10 hereof) may be terminated by you, by notice to the Company on or after
the Effective Date and prior to the Closing Time or the Option Exercise Time, if
at any time during that period any of the following has occurred:
(a) Any of the conditions specified in Section 9 hereof shall
not have been fulfilled when and as required by this Agreement to be
fulfilled or any of the covenants, representations or warranties
contained herein or in any certificate or document contemplated under
this Agreement to be delivered to you shall not have been satisfied or
fulfilled within the respective times herein provided for, unless
compliance therewith or performance or satisfaction thereof shall have
been expressly waived by you in writing;
(b) Except as disclosed in or contemplated by the Prospectus,
since the respective dates as of which information is given in the
Registration Statement and the Prospectus, any material adverse change
or any development involving a prospective
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<PAGE> 41
material adverse change in or affecting the condition (financial or
otherwise) assets, business, properties, prospects or results of
operations of the Company and the Bank taken as a whole, whether or not
arising in the ordinary course of business;
(c) Any outbreak of hostilities or escalation in existing
hostilities anywhere in the world or other national or international
calamity or crisis or change in economic or political conditions, if
the effect of such outbreak, escalation, calamity, crisis or change on
the financial markets in the United States would, in your reasonable
judgment, make it impracticable to offer for sale or to enforce
contracts made by the Underwriters for the resale of the Shares agreed
to be purchased hereunder;
(d) Any general suspension of trading in securities on the New
York Stock Exchange, the American Stock Exchange or The Nasdaq Stock
Market or any general limitation on prices for such trading or any
general restrictions on the distribution of securities, all to such a
degree as would, in your reasonable judgment, materially adversely
affect the market for the Shares; or
(e) A banking moratorium shall have been declared by federal,
Ohio or New York State authorities.
In addition, you may terminate this Agreement by giving notice of a material
breach by the Company or any Selling Shareholder of this Agreement at any time
after this Agreement becomes effective. This Agreement may also be terminated as
provided in Section 9 and Section 11, however, certain terminations of this
Agreement require payments by the Selling Shareholders to the Underwriters as
provided in Section 8.
13. Notice. Except as otherwise expressly provided in this Agreement,
(a) whenever advice or a notice, objection, designation, request or report is
given or is required by the provisions of this Agreement to be given to the
Company, such advice, notice, objection, designation, request or report shall be
in writing or by telegraph confirmed in writing, addressed to the Company and
delivered to Oak Hill Financial, Inc., 14621 State Route 93, Jackson, Ohio
45640, Attention: John D. Kidd, President, with a copy to Porter, Wright, Morris
& Arthur, 41 South High Street, Columbus, Ohio 43215, Attention: H. Grant
Stephenson, Esq.; and (b) whenever advice or a notice, objection, designation,
request or report is given or is required by the provisions of this Agreement to
be given to the Selling Shareholders, such advice, notice, objection,
designation, request or report shall be in writing or by telegraph confirmed in
writing, addressed to the Agent of the Selling Shareholder, Oak Hill Financial,
Inc., 14621 State Route 93, Jackson, Ohio 45640, Attention: John D. Kidd; and
(c) whenever advice or a notice, objection, designation, request or report is
given or is required by the provisions of this Agreement to be given to you,
such advice, notice, objection, designation, request or report shall be in
writing, addressed to McDonald & Company Securities, Inc., McDonald Investment
Center, 800 Superior Avenue, Cleveland, Ohio 44114-2603, Attention: Charles R.
Crowley, with a copy to Vorys, Sater, Seymour and Pease LLP, Suite 2100, Atrium
Two, 221 East Fourth Street, Cincinnati, Ohio 45202, Attention: Terri Reyering
Abare, Esq., or at such other address
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<PAGE> 42
as a party hereto may give notice in accordance herewith.
14. Survival of Agreements, Representations and Indemnities. The
respective indemnities and contribution agreements of the Company, the Selling
Shareholders and the Underwriters, the representation and warranties of the
Company and the Selling Shareholders and the agreements in Sections 8, 10 and 12
set forth in or made pursuant to this Agreement shall remain in full force and
effect, regardless of any termination or cancellation of this Agreement or any
investigation made by or on behalf of the Underwriters or the Company, any
Selling Shareholder or any controlling person or indemnified party referred to
in Section 10 of this Agreement, and shall survive any termination of this
Agreement and/or the delivery of and payment for the Shares.
15. Miscellaneous.
(a) This Agreement is made solely for the benefit of the
Underwriters, the Company, the Company's directors, the Company's
officers who shall have signed the Registration Statement, the Selling
Shareholders and any controlling person referred to in Section 10
hereof, and their respective successors and assigns, and no other
person, partnership, association or corporation shall acquire or have
any right under or by virtue of this Agreement. The term "successor" or
the term "successors and assigns" as used in this Agreement shall not
include any buyer, as such, of any of the Shares from any Underwriter.
(b) The information in the Prospectus under the caption
"UNDERWRITING" shall constitute the only information furnished in
writing by or on behalf of the Underwriters for use in connection with
the preparation of the Registration Statement as originally filed or in
any amendment thereto, any Preliminary Prospectus or the Prospectus, as
the case may be.
(c) This Agreement shall supersede any agreement or
understanding, oral or in writing, express or implied, between the
Company and you relating to the sale of any of the Shares.
(d) No change, amendment or supplement to, or waiver of, this
Agreement or any term, provision or condition contained herein, shall
be valid or of any effect unless in writing and signed by the party
against whom such is asserted.
(e) This Agreement shall be governed by and construed in
accordance with the laws of the State of Ohio applicable to contracts
made and to be performed therein without giving effect to the
principles of conflicts of law thereof.
(f) This Agreement may be signed in two or more counterparts
with the same effect as if the signatures to each counterpart were upon
a single instrument, and all such counterparts together shall be deemed
an original of this Agreement.
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<PAGE> 43
(g) In the event that any term, provision or covenant of this
Agreement or the application thereof to any circumstance or situation
shall be invalid or unenforceable, in whole or in part, the remainder
hereof and the application of such term, provision or covenant to any
other circumstance or situation shall not be affected thereby, and each
term, provision or covenant of this Agreement shall be valid and
enforceable to the full extent permitted by law.
(h) This Agreement will inure solely to the benefit of and be
binding upon the parties hereto and the officers and directors and
controlling persons referred to in Section 10 hereof and their
respective successors, assigns, heirs, executors and administrators,
and no other persons will have any right or obligation hereunder.
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<PAGE> 44
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed copies hereof, whereupon it
will be a binding agreement by and between the Company and you in accordance
with its term.
Very truly yours,
OAK HILL FINANCIAL, INC.
By:
------------------------------
John D. Kidd, President
SELLING SHAREHOLDERS:
EVAN E. DAVIS
By:
------------------------------
JOHN D. KIDD
By:
------------------------------
RICHARD P. LEGRAND
By:
------------------------------
DONNA J. LLOYD
By:
------------------------------
Accepted as of the date first above
written:
McDONALD & COMPANY SECURITIES, INC.
Acting on behalf of itself and as
Representative of the several Underwriters
named in Schedule B hereto.
By:
--------------------------------------
Charles R. Crowley, Managing Director
ADVEST, INC.
Acting on behalf of itself and as
Representative of the several Underwriters
named in Schedule B hereto.
By:
--------------------------------------
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SCHEDULE A
Common Shares to be Sold by the Selling Shareholders
Selling Shareholder Number of Firm Shares Number of Option Shares
- ------------------- --------------------- -----------------------
Evan E. Davis 560,000 86,625
John D. Kidd 270,600 44,625
Richard P. LeGrand 25,200 --
Donna J. Lloyd 19,200 --
------- -------
Total: 875,000 131,250
======= =======
<PAGE> 46
SCHEDULE B
Common Shares to be Purchased by the Underwriters
Underwriter Number of Firm Shares
- ----------- ---------------------
McDonald & Company Securities, Inc.
Advest, Inc.
Total: 875,000
=======
