LOAN AGREEMENT
Exhibit
10.2
THIS
LOAN AGREEMENT
(“Loan
Agreement”) is made and entered into as of the ___ day of ______________, 2007,
by and between the
BENEFICIAL MUTUAL SAVINGS BANK EMPLOYEE STOCK OWNERSHIP PLAN
TRUST
(“Borrower”), a trust forming part of the Beneficial Mutual Savings Bank
Employee Stock Ownership Plan (“ESOP”); and
BENEFICIAL MUTUAL BANCORP, INC.
(“Lender”), a corporation organized and existing under the laws of the United
States of America.
W
I T N E
S S E T H
WHEREAS,
the Borrower is authorized to purchase shares of common stock of Beneficial
Mutual Bancorp, Inc. (“Common Stock”), either directly from Beneficial Mutual
Bancorp, Inc. or in open market purchases in an amount not to exceed _________
shares of Common Stock.
WHEREAS,
the Borrower is authorized to borrow funds from the Lender for the purpose
of
financing authorized purchases of Common Stock; and
WHEREAS,
the Lender is willing to make a loan to the Borrower for such
purpose.
NOW,
THEREFORE, the parties agree hereto as follows:
ARTICLE
I
DEFINITIONS
The
following definitions shall apply for purposes of this Loan Agreement, except
to
the extent that a different meaning is plainly indicated by the
context:
Business
Day
means
any day other than a Saturday, Sunday or other day on which banks are authorized
or required to close under federal or local law or regulation.
Code
means
the Internal Revenue Code of 1986, as amended (including the corresponding
provisions of any succeeding law).
Default
means an
event or condition which would constitute an Event of Default. The determination
as to whether an event or condition would constitute an Event of Default
shall
be determined without regard to any applicable requirements of notice or
lapse
of time.
ERISA
means
the Employee Retirement Income Security Act of 1974, as amended (including
the
corresponding provisions of any succeeding law).
Event
of Default
means an
event or condition described in Article 5.
Loan
means
the loan described in section 2.1.
Loan
Documents
means,
collectively, the Loan Agreement, the Promissory Note and the Pledge Agreement
and all other documents now or hereafter executed and delivered in connection
with such documents, including all amendments, modifications and supplements
of
or to all such documents.
Pledge
Agreement
means
the agreement described in section 2.8(a).
Principal
Amount
means
the face amount of the Promissory Note, determined as set forth in section
2.1(c).
Promissory
Note
means
the promissory note described in section 2.3.
Register
means
the register described in section 2.9.
ARTICLE
II
THE
LOAN;
PRINCIPAL AMOUNT;
INTEREST;
SECURITY; INDEMNIFICATION
Section
2.1 The
Loan; Principal Amount.
(a) The
Lender hereby agrees to lend to the Borrower such amount, and at such time,
as
shall be determined under this Section 2.1; provided, however, that in no
event
shall the aggregate amount lent under this Loan Agreement from time to time
exceed the greater of (i) $__________ or (ii) the aggregate amount paid by
the Borrower to purchase up to _________ shares of Common Stock.
(b) Subject
to the limitations of Section 2.1(a), the Borrower shall determine the amounts
borrowed under this Agreement, and the time at which such borrowings are
effected. Each such determination shall be evidenced in a writing which shall
set forth the amount to be borrowed and the date on which the Lender shall
disburse such amount, and such writing shall be furnished to the Lender by
notice from the Borrower. The Lender shall disburse to the Borrower the amount
specified in each such notice on the date specified therein or, if later,
as
promptly as practicable following the Lender’s receipt of such notice; provided,
however, that the Lender shall have no obligation to disburse funds pursuant
to
this Agreement following the occurrence of a Default or an Event of Default
until such time as such Default or Event of Default shall have been
cured.
(c) For
all
purposes of this Loan Agreement, the Principal Amount on any date shall be
equal
to the excess, if any, of:
(i)
|
the
aggregate amount disbursed by the Lender pursuant to section 2.1(b)
on or
before such date; over
|
(ii)
|
the
aggregate amount of any repayments of such amounts made before
such
date.
|
The
Lender shall maintain on the Register a record of, and shall record in the
Promissory Note, the Principal Amount, any changes in the Principal Amount
and
the effective date of any changes in the Principal Amount.
Section
2.2 Interest.
(a) The
Borrower shall pay to the Lender interest on the Principal Amount, for the
period commencing with the first disbursement of funds under this Loan Agreement
and continuing until the Principal Amount shall be paid in full, at the rate
of
______________ percent (_____%) per annum. Interest payable under this Agreement
shall be computed on the basis of a year of 365 days and actual days elapsed
(including the first day but excluding the last) occurring during the period
to
which the computation relates.
2
(b) Accrued
interest on the Principal Amount shall be payable by the Borrower on the
dates
set forth in Schedule I to the Promissory Note. All interest on the Principal
Amount shall be paid by the Borrower in immediately available
funds.
(c) Anything
in the Loan Agreement or the Promissory Note to the contrary notwithstanding,
the obligation of the Borrower to make payments of interest shall be subject
to
the limitation that payments of interest shall not be required to be made
to the
Lender to the extent that the Lender’s receipt thereof would not be permissible
under the law or laws applicable to the Lender limiting rates of interest
which
may be charged or collected by the Lender. Any such payment referred to in
the
preceding sentence shall be made by the Borrower to the Lender on the earliest
interest payment date or dates on which the receipt thereof would be permissible
under the laws applicable to the Lender limiting rates of interest which
may be
charged or collected by the Lender. Such deferred interest shall not bear
interest.
Section
2.3 Promissory
Note.
The
Loan
shall be evidenced by the Promissory Note of the Borrower attached hereto
as an
exhibit payable to the order of the lender in the Principal Amount and otherwise
duly completed.
Section
2.4 Payment
of Trust Loan.
The
Principal Amount of the Loan shall be repaid in accordance with Schedule
I to
the Promissory Note on the dates specified therein until fully
paid.
Section
2.5 Prepayment.
The
Borrower shall be entitled to prepay the Loan in whole or in part, at any
time
and from time to time; provided, however, that the Borrower shall give notice
to
the Lender of any such prepayment; and provided, further, that any partial
prepayment of the Loan shall be in an amount not less than $1,000. Any such
prepayment shall be: (a) permanent and irrevocable; (b) accompanied by all
accrued interest through the date of such prepayment; (c) made without premium
or penalty; and (d) applied on the inverse order of the maturity of the
installment thereof unless the Lender and the Borrower agree to apply such
prepayments in some other order.
Section
2.6 Method
of Payments.
(a) All
payments of principal, interest, other charges (including indemnities) and
other
amounts payable by the Borrower hereunder shall be made in lawful money of
the
United States, in immediately available funds, to the Lender at the address
specified in or pursuant to this Loan Agreement for notices to the Lender,
on
the date on which such payment shall become due. Any such payment made on
such
date but after such time shall, if the amount paid bears interest, and except
as
expressly provided to the contrary herein, be deemed to have been made on,
and
interest shall continue to accrue and be payable thereon until, the next
succeeding Business Day. If any payment of principal or interest becomes
due on
a day other than a Business Day, such payment may be made on the next succeeding
Business Day, and when paid, such payment shall include interest to the day
on
which payment is in fact made.
3
(b) Notwithstanding
anything to the contrary contained in this Loan Agreement or the Promissory
Note, the Borrower shall not be obligated to make any payment, repayment
or
prepayment on the Promissory Note if doing so would cause the ESOP to cease
to
be an employee stock ownership plan within the meaning of section 4975(e)(7)
of
the Code or qualified under section 401(a) of the Code or cause the Borrower
to
cease to be a tax exempt trust under section 501(a) of the Code or if such
act
or failure to act would cause the Borrower to engage in any “prohibited
transaction” as such term is defined in the section 4975(c) of the Code and the
regulations promulgated thereunder which is not exempted by section 4975(c)(2)
or (d) of the Code and the regulations promulgated thereunder or in section
406
of ERISA and the regulations promulgated thereunder which is not exempted
by
section 408(b) of ERISA and the regulations promulgated thereunder; provided,
however, that in each case, the Borrower, may act or refrain from acting
pursuant to this section 2.6(b) on the basis of an opinion of counsel, and
any
opinion of such counsel. The Borrower may consult with counsel, and any opinion
of such counsel shall be full and complete authorization and protection in
respect of any action taken or suffered or omitted by it hereunder in good
faith
and in accordance with such opinion of counsel. Nothing contained in this
section 2.6(b) shall be construed as imposing a duty on the Borrower to consult
with counsel. Any obligation of the Borrower to make any payment, repayment
or
prepayment on the Promissory Note or refrain from taking any other act hereunder
or under the Promissory Note which is excused pursuant to this section 2.6(b)
shall be considered a binding obligation of the Borrower, or both, as the
case
may be, for the purposes of determining whether a Default or Event of Default
has occurred hereunder or under the Promissory Note and nothing in this section
2.6(b) shall be construed as providing a defense to any remedies otherwise
available upon a Default or an Event of Default hereunder (other than the
remedy
of specific performance).
Section
2.7 Use
of Proceeds of Loan.
The
entire proceeds of the Loan shall be used solely for acquiring shares of
Common
Stock, and for no other purpose whatsoever.
Section
2.8 Security.
(a) In
order
to secure the due payment and performance by the Borrower of all of its
obligations under this Loan Agreement, simultaneously with the execution
and
delivery of this Loan Agreement by the Borrower, the Borrower
shall:
(i)
|
pledge
to the Lender as Collateral (as defined in the Pledge Agreement),
and
grant to the Lender a first priority lien on and security interest
in, the
Common Stock purchased with the Principal Amount, by the execution
and
delivery to the lender of the Pledge Agreement attached hereto
as an
exhibit; and
|
(ii)
|
execute
and deliver, or cause to be executed and delivered, such other
agreement,
instruments and documents as the Lender may reasonably require
in order to
effect the purposes of the Pledge Agreement and this Loan
Agreement.
|
(b) The
Lender shall release from encumbrance under the Pledge Agreement and transfer
to
the Borrower, as of the date on which any payment or repayment of the Principal
Amount is made, a number of shares of Common Stock held as Collateral determined
pursuant to the applicable provisions of the ESOP.
4
Section
2.9 Registration
of the Promissory Note.
(a) The
Lender shall maintain a Register providing for the registration of the Principal
Amount and any stated interest and of transfer and exchange of the Promissory
Note. Transfer of the Promissory Note may be effected only by the surrender
of
the old instrument and either the reissuance by the Borrower of the old
instrument to the new holder or the issuance by the Borrower of a new instrument
to the new holder. The old Promissory Note so surrendered shall be canceled
by
the Lender and returned to the Borrower after such cancellation.
(b) Any
new
Promissory Note issued pursuant to section 2.9(a) shall carry the same rights
to
interest (unpaid and to accrue) carried by the Promissory Note so transferred
or
exchanged so that there will not be any loss or gain of interest on the note
surrender. Such new Promissory Note shall be subject to all of the provisions
and entitled to all of the benefits of this Agreement. Prior to due presentment
for registration or transfer, the Borrower may deem and treat the registered
holder of any Promissory Note as the holder thereof for purposes of payment
and
other purposes. A notation shall be made on each new Promissory Note of the
amount of all payments of principal and interest theretofore paid.
ARTICLE
III
REPRESENTATIONS
AND WARRANTIES OF THE BORROWER
The
Borrower hereby represents and warrants to the Lender as follows:
Section
3.1 Power,
Authority, Consents.
The
Borrower has the power to execute, deliver and perform this Loan Agreement,
the
Promissory Note and Pledge Agreement, all of which have been duly authorized
by
all necessary and proper corporate or other action.
Section
3.2 Due
Execution, Validity, Enforceability.
Each
of
the Loan Documents, including, without limitation, this Loan Agreement, the
Promissory Note and the Pledge Agreement, has been duly executed and delivered
by the Borrower; and each constitutes the valid and legally binding obligation
of the Borrower, enforceable in accordance with its terms.
Section
3.3 Properties,
Priority of Liens.
The
liens
which have been created and granted by the Pledge Agreement constitute valid,
first liens on the properties and assets covered by the Pledge Agreement,
subject to no prior or equal lien.
Section
3.4 No
Defaults, Compliance with Laws.
The
Borrower is not in default in any material respect under any agreement,
ordinance, resolution, decree, bond, note, indenture, order or judgment to
which
it is a party or by which it is bound, or any other agreement or other
instrument by which any of the properties or assets owned by it is materially
affected.
5
Section
3.5 Purchase
of Common Stock.
Upon
consummation of any purchase of Common Stock by the Borrower with the proceeds
of the Loan, the Borrower shall acquire valid, legal and marketable title
to all
of the Common Stock so purchased, free and clear of any liens, other than
a
pledge to the Lender of the Common Stock so purchased pursuant to the Pledge
Agreement. Neither the execution and delivery of the Loan Documents nor the
performance of any obligation thereunder violates any provisions of law or
conflicts with or results in a breach of or creates (with or without the
giving
of notice of lapse of time, or both) a default under any agreement to which
the
Borrower is a party or by which it is bound or any of its properties is
affected. No consent of any federal, state, or local governmental authority,
agency, or other regulatory body, the absence of which could have a materially
adverse effect on the Borrower or the Trustee, is or was required to be obtained
in connection with the execution, delivery, or performance of the Loan Documents
and the transaction contemplated therein or in connection therewith, including
without limitation, with respect to the transfer of the shares of Common
Stock
purchased with the proceeds of the Loan pursuant thereto.
Section
3.6 ESOP;
Contributions.
As
of the
effective date of the ESOP sponsor’s conversion, the ESOP and the Borrower will
be duly created, organized and maintained by the ESOP sponsor in compliance
with
all applicable laws, regulations and rulings. The ESOP will qualify as an
“employee stock ownership plan” as defined in section 4975(e)(7) of the Code.
The ESOP provides that the ESOP sponsor may make contributions to the ESOP
in an
amount necessary to enable the Trustee to amortize the Loan in accordance
with
the terms of the Promissory Note; provided, however, that no such contributions
shall be required if they would adversely affect the qualification of the
ESOP
under section 401(a) of the Code.
Section
3.7 Trustee.
The
trustee of the ESOP has been duly appointed by the ESOP sponsor.
Section
3.8 Compliance
with Laws; Actions.
Neither
the execution and delivery by the Borrower of this Loan Agreement or any
instruments required thereby, nor compliance with the terms and provisions
of
any such documents by the lender, constitutes a violation of any provision
of
any law or any regulation, order, writ, injunction or decree of any court
or
governmental instrumentality, or an event of default under any agreement,
to
which the Borrower is a party, to which the Borrower is bound or to which
the
Borrower is subject, which violation or event of default would have a material
adverse effect on the Borrower. There is no action or proceeding pending
or
threatened against either the ESOP or the Borrower before any court or
administrative agency.
ARTICLE
IV
REPRESENTATIONS
AND WARRANTIES OF THE LENDER
The
Lender hereby represents and warrants to the Borrower as follows:
Section
4.1 Power,
Authority, Consents.
The
Lender has the power to execute, deliver and perform this Loan Agreement,
the
Pledge Agreement and all documents executed by the Lender in connection with
the
Loan, all of
6
which
have been duly authorized by all necessary and proper corporate or other
action.
No consent, authorization or approval or other action by any governmental
authority or regulatory body, and no notice by the Lender to, or filing by
the
Lender with, any governmental authority or regulatory body is required for
the
due execution, delivery and performance of this Loan Agreement.
Section
4.2 Due
Execution, Validity, Enforceability.
This
Loan
Agreement and the Pledge Agreement have been duly executed and delivered
by the
Lender, and each constitutes a valid and legally binding obligation of the
Lender, enforceable in accordance with its terms.
ARTICLE
V
EVENTS
OF DEFAULT
Section
5.1 Events
of Default under Loan Agreement.
Each
of
the following events shall constitute an “Event of Default”
hereunder:
(a) Failure
to make any payment or mandatory prepayment of principal of the Promissory
Note
when due, or failure to make any payment of interest on the Promissory Note
not
later than five (5) Business Days after the date when due.
(b) Failure
by the Borrower to perform or observe any term, condition or covenant of
this
Loan Agreement or of any of the other Loan Documents, including, without
limitation, the Promissory Note and the Pledge Agreement.
(c) Any
representation or warranty made in writing to the Lender in any of the Loan
Documents, or any certificate, statement or report made or delivered in
compliance with this Loan Agreement, shall have been false or misleading
in any
material respect when made or delivered.
Section
5.2 Lender’s
Rights upon Event of Default.
If
an
Event of Default under this Loan Agreement shall occur and be continuing,
the
Lender shall have no rights to assets of the Borrower other than: (a)
contributions (other than contributions of Common Stock) that are made by
the
ESOP sponsor to enable the Borrower to meet its obligations pursuant to this
Loan Agreement and earnings attributable to the investment of such contributions
and (b) “Eligible Collateral” (as defined in the Pledge Agreement); provided,
however, that: (i) the value of the Borrower’s assets transferred to the Lender
following an Event of Default in satisfaction of the due and unpaid amount
of
the Loan shall not exceed the amount in default (without regard to amounts
owing
solely as a result of any acceleration of the Loan); (ii) the Borrower’s assets
shall be transferred to the Lender following an Event of Default only to
the
extent of the failure of the Borrower to meet the payment schedule of the
Loan;
and (iii) all rights of the Lender to the Common Stock purchased with the
proceeds of the Loan covered by the Pledge Agreement following an Event of
Default shall be governed by the terms of the Pledge Agreement.
7
ARTICLE
VI
MISCELLANEOUS
PROVISIONS
Section
6.1 Payments
Due to the Lender.
If
any
amount is payable by the Borrower to the Lender pursuant to any indemnity
obligation contained herein, then the Borrower shall pay, at the time or
times
provided therefor, any such amount and shall indemnify the Lender against
and
hold it harmless from any loss or damage resulting from or arising out of
the
nonpayment or delay in payment of any such amount. If any amounts as to which
the Borrower has so indemnified the Lender hereunder shall be assessed or
levied
against the Lender, the Lender may notify the Borrower and make immediate
payment thereof, together with interest or penalties in connection therewith,
and shall thereupon be entitled to and shall receive immediate reimbursement
therefor from the Borrower, together with interest on each such amount as
provided for in section 2.2(c). Notwithstanding any other provision contained
in
this Loan Agreement, the covenants and agreements of the Borrower contained
in
this section 6.1 shall survive: (a) payment of the Promissory Note and (b)
termination of this Loan Agreement.
Section
6.2 Payments.
All
payments hereunder and under the Promissory Note shall be made without set-off
or counterclaim and in such amounts as may be necessary in order that all
such
payments shall not be less than the amounts otherwise specified to be paid
under
this Loan Agreement and the Promissory Note, subject to any applicable tax
withholding requirements. Upon payment in full of the Promissory Note, the
Lender shall xxxx such Promissory Note “Paid” and return it to the
Borrower.
Section
6.3 Survival.
All
agreements, representations and warranties made herein shall survive the
delivery of this Loan Agreement and the Promissory Note.
Section
6.4 Modifications,
Consents and Waivers; Entire Agreement.
No
modification, amendment or waiver of or with respect to any provision of
this
Loan Agreement, the Promissory Note, the Pledge Agreement, or any of the
other
Loan Documents, nor consent to any departure from any of the terms or conditions
thereof, shall in any event be effective unless it shall be in writing and
signed by the party against whom enforcement thereof is sought. Any such
waiver
or consent shall be effective only in the specific instance and for the purpose
for which given. No consent to or demand on a party in any case shall, of
itself, entitle it to any other or further notice or demand in similar or
other
circumstances. This Loan Agreement embodies the entire agreement and
understanding between the Lender and the Borrower and supersedes all prior
agreements and understandings relating to the subject matter
hereof.
Section
6.5 Remedies
Cumulative.
Each
and
every right granted to the Lender hereunder or under any other document
delivered hereunder or in connection herewith, or allowed it by law or equity,
shall be cumulative and may be exercised from time to time. No failure on
the
part of the Lender or the holder of the Promissory Note to exercise, and
no
delay in exercising, any right shall operate as a waiver thereof, nor shall
any
single or partial exercise of any right preclude any other or future exercise
thereof or the exercise of any other right. The due payment and performance
of
the
8
obligations
under the Loan Documents shall be without regard to any counterclaim, right
of
offset or any other claim whatsoever which the Borrower may have against
the
Lender and without regard to any other obligation of any nature whatsoever
which
the Lender may have to the Borrower, and no such counterclaim or offset shall
be
asserted by the Borrower in any action, suit or proceeding instituted by
the
Lender for payment or performance of such obligations.
Section
6.6 Further
Assurances; Compliance with Covenants.
At
any
time and from time to time, upon the request of the Lender, the Borrower
shall
execute, deliver and acknowledge or cause to be executed, delivered and
acknowledged, such further documents and instruments and do such other acts
and
things as the Lender may reasonably request in order to fully effect the
terms
of this Loan Agreement, the Promissory Note, the Pledge Agreement, the other
Loan Documents and any other agreements, instruments and documents delivered
pursuant hereto or in connection with the Loan.
Section
6.7 Notices.
Except
as
otherwise specifically provided for herein, all notice, requests, reports
and
other communications pursuant to this Loan Agreement shall be in writing,
either
by letter (delivered by hand or commercial messenger service or sent by
registered or certified mail, return receipt requested, except for routine
reports delivered in compliance with Article VI hereof which may be sent
by
ordinary first-class mail) or telex or telecopier addressed as
follows:
(a) If
to the
Borrower:
(b) If
to the
Lender:
Any
notice, request or communication hereunder shall be deemed to have been given
on
the day on which it is delivered by hand or by commercial messenger service,
or
sent by telex or telecopier, to such party at its address specified above,
or,
if sent by mail, on the third Business Day after the day deposited in the
mail,
postage prepaid, addressed as aforesaid. Any party may change the person
or
address to whom or which notices are to be given hereunder, by notice duly
given
hereunder; provided, however, that any such notice shall be deemed to have
been
given only when actually received by the party to whom it is
addressed.
Section
6.8 Counterparts.
This
Loan
Agreement may be signed in any number of counterparts which, when taken
together, shall constitute one and the same document.
Section
6.9 Construction;
Governing Law.
The
headings used in the table of contents and in this Loan Agreement are for
convenience only and shall not be deemed to constitute a part hereof. All
uses
herein of any gender or of singular or plural terms shall be deemed to include
uses of the other genders or plural or singular terms, as the context may
require. All references in this Loan Agreement of an Article or section shall
be
to an Article or section of this Loan Agreement, unless otherwise specified.
This Loan Agreement, the Promissory Note, the Pledge Agreement and the other
Loan Documents shall be governed by, and construed and interpreted in accordance
with, the laws of the Commonwealth of Pennsylvania.
9
Section
6.10 Severability.
Wherever
possible, each provision of this Loan Agreement shall be interpreted in such
manner as to be effective and valid under applicable law; however, the
provisions of this Loan Agreement are severable, and if any clause or provision
hereof shall be held invalid or unenforceable in whole or in part in any
jurisdiction, then such invalidity or unenforceability shall affect only
such
clause or provision, or part thereof, in such jurisdiction and shall not
in any
manner affect such clause or provision in any other jurisdiction, or any
other
clause or provisions in this Loan Agreement in any jurisdiction. Each of
the
covenants, agreements and conditions contained in this Loan Agreement are
independent, and compliance by a party with any of them shall not excuse
non-compliance by such party with any other. The Borrower shall not take
any
action the effect of which shall constitute a breach or violation of any
provision of this Loan Agreement.
Section
6.11 Binding
Effect: No Assignment or Delegation.
This
Loan
Agreement shall be binding upon and inure to the benefit of the Borrower
and its
successors and the Lender and its successors and assigns. The rights and
obligations of the Borrower under this Agreement shall not be assigned or
delegated without the prior written consent of the Lender, and any purported
assignment or delegation without such consent shall be void.
10
IN
WITNESS WHEREOF, the parties have caused this Loan Agreement to be executed
as
of the date first written above.
BENEFICIAL
MUTUAL SAVINGS BANK
EMPLOYEE
STOCK OWNERSHIP PLAN TRUST
___________________________________________
Authorized
Trust Officer
BENEFICIAL
MUTUAL BANCORP, INC.
By:_______________________________________
President and Chief Executive
Officer
|
11
PLEDGE
AGREEMENT
THIS
PLEDGE AGREEMENT (“Pledge
Agreement”) is made as of the ___ day of _________________, 2007, by and between
the
BENEFICIAL MUTUAL SAVINGS BANK EMPLOYEE STOCK OWNERSHIP PLAN
TRUST
(“Pledgor”), and BENEFICIAL
MUTUAL BANCORP, INC. (“Pledgee”).
W
I T N E
S S E T H
WHEREAS,
this Pledge Agreement is being executed and delivered to the Pledgee pursuant
to
the terms of a Loan Agreement (“Loan Agreement”), by and between the Pledgor and
the Pledgee;
NOW,
THEREFORE, in consideration of the mutual agreements contained herein and
in the
Loan Agreement, the parties hereto do hereby covenant and agree as
follows:
Section
1. Definitions.
The
following definitions shall apply for purposes of this Pledge Agreement,
except
to the extent that a different meaning is plainly indicated by the context;
all
capitalized terms used but not defined herein shall have the respective meanings
assigned to them in the Loan Agreement:
Collateral
shall
mean the Pledged Shares and, subject to section 5 hereof, and to the extent
permitted by applicable law, all rights with respect thereto, and all proceeds
of such Pledged Shares and rights.
ESOP
shall
mean the Beneficial Mutual Savings Bank Employee Stock Ownership
Plan.
Event
of Default
shall
mean an event so defined in the Loan Agreement.
Liabilities
shall
mean all the obligations of the Pledgor to the Pledgee, howsoever created,
arising or evidenced, whether direct or indirect, absolute or contingent,
now or
hereafter existing, or due or to become due, under the Loan Agreement and
the
Promissory Note.
Pledged
Shares
shall
mean all the Shares of Common Stock of the Pledgee purchased by the Pledgor
with
the proceeds of the loan made by the Pledgee to the Pledgor pursuant to the
Loan
Agreement, but excluding any such shares previously released pursuant to
section
4.
Section
2. Pledge.
To
secure the payment of and performance of all the Liabilities, the Pledgor
hereby
pledges to the Pledgee, and grants to the Pledgee, a security interest in,
and
lien upon, the Collateral.
Section
3. Representations
and Warranties of the Pledgor.
The
Pledgor represents, warrants, and covenants to the Pledgee as
follows:
(a) the
execution, delivery and performance of this Pledge Agreement and the pledging
of
the Collateral hereunder do not and will not conflict with, result in a
violation of, or constitute a default under, any agreement binding upon the
Pledgor;
(b) the
Pledged Shares are and will continue to be owned by the Pledgor free and
clear
of any liens or rights of any other person except the lien hereunder and
under
the Loan Agreement in favor of the Pledgee, and the security interest of
the
Pledgee in the Pledged Shares and the proceeds thereof is and will continue
to
be prior to and senior to the rights of all others;
1
(c) this
Pledge Agreement is the legal, valid, binding and enforceable obligation
of the
Pledgor in accordance with its terms;
(d) the
Pledgor shall, from time to time, upon request of the Pledgee, promptly deliver
to the Pledgee such stock powers, proxies, and similar documents, satisfactory
in form and substance to the Pledgee, with respect to the Collateral as the
Pledgee may reasonably request; and
(e) subject
to the first sentence of section 4(b), the Pledgor shall not, so long as
any
Liabilities are outstanding, sell, assign, exchange, pledge or otherwise
transfer or encumber any of its rights in and to any of the
Collateral.
Section
4. Eligible
Collateral.
(a) As
used
herein the term “Eligible Collateral” shall mean the amount of Collateral which
has an aggregate fair market value equal to the amount by which the Pledgor
is
in default (without regard to any amounts owing solely as the result of an
acceleration of the Loan Agreement) or such lesser amount of Collateral as
may
be required pursuant to section 13 of this Pledge Agreement.
(b) The
Pledged Shares shall be released from this Pledge Agreement in a manner
conforming to the requirements of Treasury Regulations Section 54.4975-7(b)(8),
as the same may be from time to time amended or supplemented, and the applicable
provisions of the ESOP. Subject to such Regulations, the Pledgee may from
time
to time, after any Default or Event of Default, and without prior notice
to the
Pledgor, transfer all or any part of the Eligible Collateral in the name
of the
Pledgee or its nominee, without disclosing that such Eligible Collateral
is
subject to any rights of the Pledgor and may from time to time, whether before
or after any of the Liabilities shall become due and payable, without notice
to
the Pledgor, take all or any of the following actions: (i) notify the parties
obligated on any of the Eligible Collateral to make payment to the Pledgee
of
any amounts due or due to become due thereunder, (ii) release or exchange
all or
any part of the Eligible Collateral, or compromise or extend or renew for
any
period (whether or not longer than the original period) any obligations of
any
nature of any party with respect thereto, and (iii) take control of any proceeds
of the Eligible Collateral.
Section
5. Delivery.
(a) The
Pledgor shall deliver to the Pledgee upon execution of this Pledge Agreement
(i)
either (A) certificates for the Pledged Shares, each certificate duly signed
in
blank by the Pledgor or accompanied by a stock transfer power duly signed
in
blank by the Pledgor and each such certificate accompanied by all required
documentary or stock transfer tax stamps or (B) if the Trustee does not yet
have
possession of the Pledged Shares, an assignment by the Pledgor of all the
Pledgor’s rights to and interest in the Pledged Shares and (ii) an irrevocable
proxy, in form and substance satisfactory to the Pledgee, signed by the Pledgor
with respect to the Pledged Shares.
(b) So
long
as no Default or Event of Default shall have occurred and be continuing,
(i) the
Pledgor shall be entitled to exercise any and all voting and other rights
pertaining to the Collateral or any part thereof for any purpose not
inconsistent with the terms of this Pledge Agreement, and (ii) the Pledgor
shall
be entitled to receive any and all cash dividends or other distributions
paid in
respect of the Collateral.
2
Section
6. Events
of Default.
(a) If
a
Default or Event Default shall be existing, in addition to the rights it
may
have under the Loan Agreement, the Promissory Note, and this Pledge Agreement,
or by virtue of any other instrument, (i) the Pledgee may exercise, with
respect
to the Eligible Collateral, from time to time, any rights and remedies available
to it under the Uniform Commercial Code as in effect from time to time in
the
Commonwealth of Pennsylvania or otherwise available to it and (ii) the Pledgee
shall have the right, for and in the name, place and stead of the Pledgor,
to
execute endorsement, assignments, stock powers and other instruments of
conveyance or transfer with respect to all or any of the Eligible Collateral.
Written notification of intended disposition of any of the Eligible Collateral
shall be given by the Pledgee to the Pledgor at least three (3) Business
Days
before such disposition. Subject to section 13 below, any proceeds of any
disposition of Eligible Collateral may be applied by the Pledgee to the payment
of expenses in connection with the Eligible Collateral, including, without
limitation, reasonable attorneys’ fees and legal expenses, and any balance of
such proceeds may be applied by the Pledgee toward the payment of such of
the
Liabilities as are in Default, and in such order of application, as the Pledgee
may from time to time elect. No action of the Pledgee permitted hereunder
shall
impair or affect its rights in and to the Eligible Collateral. All rights
and
remedies of the Pledgee expressed hereunder are in addition to all other
rights
and remedies possessed by it, including, without limitation, those contained
in
the documents referred to in the definition of Liabilities in section 1
hereof.
(b) In
any
sale of any of the Eligible Collateral after a Default or an Event of Default
shall have occurred, the Pledgee is hereby authorized to comply with any
limitation or restriction in connection with such sale as it may be advised
by
counsel if necessary in order to avoid violation of applicable law (including,
without limitation, compliance with such procedures as may restrict the number
of prospective bidders and purchasers or further restrict such prospective
bidders or purchasers to persons who will represent and agree that they are
purchasing for their own account for investment and not with a view to the
distribution or resale of such Eligible Collateral), or in order to obtain
such
required approval of the sale or of the purchase by any governmental regulatory
authority or official, and the Pledgor further agrees that such compliance
shall
not result in such sale’s being considered or deemed not to have been made in a
commercially reasonable manner, nor shall the Pledgee be liable or accountable
to the Pledgor for any discount allowed by reason of the fact that such Eligible
Collateral is sold in compliance with any such limitation or
restriction.
Section
7. Payment
in Full.
Upon the
payment in full of all outstanding Liabilities, this Pledge Agreement shall
terminate and the Pledgee shall forthwith assign, transfer and deliver to
the
Pledgor, against receipt and without recourse to the Pledgee, all Collateral
then held by the Pledgee pursuant to the Pledge Agreement.
Section
8. No
Waiver.
No
failure or delay in the part of the Pledgee in exercising any right or remedy
hereunder or under any other document which confers or grants any rights
to the
Pledgee in respect of the Liabilities shall operate as a waiver thereof nor
shall any single or partial exercise of any such rights or remedy preclude
any
other or further exercise thereof or the exercise of any other right or remedy
of the Pledgee.
3
Section
9. Binding
Effect; No Assignment or Delegation.
This
Pledge Agreement shall be binding upon and inure to the benefit of the Pledgor,
the Pledgee and their respective successors and assigns, except that the
Pledgor
may not assign or transfer its rights hereunder without the prior written
consent of the Pledgee (which consent shall not unreasonably be withheld).
Each
duty or obligation of the Pledgor to the Pledgee pursuant to the provisions
of
this Pledge Agreement shall be performed in favor of any person or entity
designated by the Pledgee, and any duty or obligation of the Pledgee to the
Pledgor may be performed by any other person or entity designated by the
Pledgee.
Section
10. Governing
Law.
This
Pledge Agreement shall be governed by and construed in accordance with the
laws
of the Commonwealth of Pennsylvania applicable to agreements to be performed
wholly within the Commonwealth of Pennsylvania.
Section
11. Notices.
All
notices, requests, instructions or documents hereunder shall be in writing
and
delivered personally or sent by United States mail, registered or certified,
return receipt requested, with proper postage prepaid as follows:
(a) |
If
to the Pledgee:
Beneficial
Mutual Bancorp, Inc.
000
Xxxxxx Xxxxxx
Xxxxxxxxxxxx,
Xxxxxxxxxxxx 00000
|
(b) |
If
to the Pledgor:
Beneficial
Mutual Savings Bank
Employee
Stock Ownership Plan Trust
000
Xxxxxx Xxxxxx
Xxxxxxxxxxxx,
Xxxxxxxxxxxx 00000
|
or
at
such other address as either of the parties may designate by written notice
to
the other party. If delivered personally, the date on which a notice, request,
instruction or document is delivered shall be the date on which such delivery
is
made, and, if delivered by mail, the date on which such notice, request,
instruction, or document is deposited in the mail shall be the date of delivery.
Each notice, request, instruction or document shall bear the date on which
it is
delivered.
Section
12. Interpretation.
Wherever
possible each provision of this Pledge Agreement shall be interpreted in
such
manner as to be effective and valid under applicable law, but if any provision
herein shall be prohibited by or invalid under such law, such provision shall
be
ineffective to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or the remaining provisions
hereof.
Section
13. Construction.
All
provisions hereof shall be construed so as to maintain (a) the ESOP as a
qualified leveraged employee stock ownership plan under section 401(a) and
4975(e)(7) of the Internal Revenue Code of 1986 (the “Code”), (b) the Trust as
exempt from taxation under section 501(a) of the Code and (c) the Trust Loan
as
an exempt loan under section 54.4975-7(b) of the Treasury Regulations and
as
described in Department of Labor Regulation section 2550.408b-3.
4
IN
WITNESS WHEREOF, this Pledge Agreement has been duly executed by the parties
hereto as of the day and year first above written.
|
BENEFICIAL
MUTUAL SAVINGS BANK
EMPLOYEE
STOCK OWNERSHIP PLAN TRUST
_____________________________________
Authorized
Trust Officer
BENEFICIAL
MUTUAL BANCORP, INC.
By:
___________________________________
President and Chief Executive
Officer
|
5
PROMISSORY
NOTE
FOR
VALUE RECEIVED,
the
undersigned,
BENEFICIAL MUTUAL SAVINGS BANK EMPLOYEE STOCK OWNERSHIP PLAN
TRUST
(the
“Borrower”), hereby promises to pay to the order of BENEFICIAL
MUTUAL BANCORP, INC. (the
“Lender”) up to $___________ payable in accordance with the Loan Agreement made
and entered into between the Borrower and the Lender of even date herewith
(“Loan Agreement”) pursuant to which this Promissory Note is
issued.
The
Principal Amount of this Promissory Note shall be payable in accordance with
the
schedule attached hereto (“Schedule I”).
This
Promissory Note shall bear interest at the rate per annum set forth or
established under the Loan Agreement, such interest to be payable in accordance
with Schedule I.
Anything
herein to the contrary notwithstanding, the obligation of the Borrower to
make
payments of interest shall be subject to the limitation that payments of
interest shall not be required to be made to the Lender to the extent that
the
Lender’s receipt thereof would not be permissible under the law or laws
applicable to the Lender limiting rates on interest which may be charged
or
collected by the Lender. Any such payments on interest which are not made
as a
result of the limitation referred to in the preceding sentence shall be made
by
the Borrower to the Lender on the earliest interest payment date or dates
on
which the receipt thereof would be permissible under the laws applicable
to the
Lender limiting rates of interest which may be charged or collected by the
Lender. Such deferred interest shall not bear interest.
Payments
of both principal and interest on this Promissory Note are to be made at
the
principal office of the Lender or such other place as the holder hereof shall
designate to the Borrower in writing, in lawful money of the United States
of
America in immediately available funds.
Failure
to make any payments of principal on this Promissory Note when due, or failure
to make any payment of interest on this Promissory Note not later than five
(5)
Business Days after the date when due, shall constitute a default hereunder,
whereupon the principal amount of accrued interest on this Promissory Note
shall
immediately become due and payable in accordance with the terms of the Loan
Agreement.
This
Promissory Note is secured by a Pledge Agreement between the Borrower and
the
Lender of even date herewith and is entitled to the benefits
thereof.
BENEFICIAL
MUTUAL SAVINGS BANK
EMPLOYEE
STOCK OWNERSHIP PLAN TRUST
__________________________
Authorized
Trust Officer
|