EXHIBIT 1.2
MASSACHUSETTS FINCORP, INC.
504,475 to 784,904 SHARES
COMMON STOCK
(PAR VALUE $0.01 PER SHARE)
$10.00 PER SHARE
SALES AGENCY AGREEMENT
----------------------
Trident Securities, Inc.
0000 Xxx Xxxxx Xxxx, Xxxxx 000
Xxxxxxx, Xxxxx Xxxxxxxx 00000
Dear Sirs:
Massachusetts Fincorp, Inc., a corporation organized under the laws of the
State of Delaware (the "Company"), and The Massachusetts Co-operative Bank, a
Massachusetts-chartered mutual co-operative bank (the "Bank") hereby confirm, as
of ____________, 1998, their agreement with Trident Securities, Inc.
("Trident"), a broker-dealer registered with the Securities and Exchange
Commission (the "Commission") and a member of the National Association of
Securities Dealers, Inc. (the "NASD"), as follows:
1. Introductory. The Company has been formed for the purpose of becoming the
holding company for the Bank, which intends to convert from mutual to stock
form (together with the Offerings (as hereinafter defined), and the issuance
of shares of stock of the Bank to the Company, the "Conversion") pursuant to
a plan of conversion, as amended, adopted by the Board of Directors of the
Bank on May 6, 1998 and amended on __________, 1998 (the "Plan"). In
accordance with the Plan, the Company is offering shares of its common
stock, par value $0.01 per share (the "Shares" or the "Common Stock")
pursuant to nontransferable subscription rights in a subscription offering
(the "Subscription Offering") to certain depositors of the Bank, to certain
tax-qualified employee benefit plans of the Company and the Bank
(collectively, the "Employee Plans"), including the Massachusetts Co-
operative Bank Employee Stock Ownership Plan (the "ESOP") and directors,
officers and employees of the Bank. Concurrently with the Subscription
Offering, shares of the Common Stock not sold in the Subscription Offering
are being offered in a community offering to certain members of the general
public with a preference being given to natural persons residing in Suffolk
and Norfolk Counties, Massachusetts (the "Direct Community Offering") (the
Subscription Offering and the Direct Community Offering are sometimes
referred to collectively as the "Subscription and Direct Community
Offering"), subject to the right of the Bank, in its absolute discretion, to
reject orders in the Direct Community Offering in whole or in part. It is
anticipated that shares of Common Stock not subscribed for in the
Subscription and
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Direct Community Offering (if any) will be offered to certain members of
the general public on a best efforts basis by a selling group of broker-
dealers managed by Trident in a syndicated offering (the "Syndicated
Offering") (the Subscription Offering, the Direct Community Offering and
the Syndicated Offering are referred to collectively as the "Offerings").
In the Subscription and Direct Community Offering (and the Syndicated
Offering, if applicable), the Company is offering between 504,475 and
682,525 Shares (the "Current Valuation Range"), with the possibility of
offering up to 784,904 Shares without a resolicitation of subscribers
pursuant to (i) Massachusetts General Laws, Chapter 170, Section 26E, (ii)
209 C.M.R. 33.00 et. seq., (iii) 12 C.F.R. 333.4 or (iv) 12 C.F.R. 303.15
(collectively, the "Conversion Regulations"). With the exception of the
ESOP, no individual person or other entity, together with associates of and
persons acting in concert with such person or other entity, may subscribe
for more than 2% of the Common Stock offered in the Conversion.
The Company has filed with the Commission a registration statement on Form
SB-2 (No. 333-60237), including a prospectus for the registration of the Shares
under the Securities Act of 1933, as amended (the "Securities Act"), and such
amendments thereto, if any, and such amended prospectuses as may have been
required to the date hereof by the Commission in order to declare such
registration statement effective; and will file such additional amendments
thereto and such amended prospectuses and prospectus supplements as may
hereafter be required. Such registration statement (as amended to date, if
applicable, and as from time to time amended or supplemented hereafter) and the
prospectus constituting a part thereof (including in each case all documents
incorporated or deemed to be incorporated by reference therein, if any, and the
information, if any, deemed to be part thereof pursuant to the rules and
regulations of the Commission under the Securities Act, as from time to time
amended or supplemented pursuant to the Securities Act or otherwise (the
"Securities Act Regulations")) are hereinafter referred to as the "Registration
Statement" and the "Prospectus," respectively, except that if any revised
prospectus that shall be used by the Company in connection with the Subscription
and Direct Community Offering or the Syndicated Offering differs from the
Prospectus on file with the Commission at the time the Registration Statement
becomes effective (whether or not such revised prospectus is required to be
filed by the Company pursuant to Rule 424(b) of the Securities Act Regulations),
the term "Prospectus" shall refer to such revised prospectus from and after the
time it is first provided to Trident for such use.
In connection with the Conversion and pursuant to the terms of the Plan as
described in the Prospectus, immediately following the consummation of the
Conversion, subject to compliance with certain conditions as may be imposed by
regulatory authorities, the Company will contribute a number of Shares equal to
5% of the Common Stock sold in the Offerings (the "Foundation Shares") to the
Massachusetts Co-operative Charitable Foundation, a charitable foundation to be
established
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by the Bank and the Company (the "Foundation").
The Company has been advised by Trident that Trident will use its best
efforts in assisting the Company with the sale of the Shares in the Offerings.
Prior to the execution of this Agreement, the Company has delivered to Trident
the Prospectus dated October ___, 1998 (hereinafter defined) and all supplements
thereto to be used in the Offerings. Such Prospectus contains information with
respect to the Company, the Bank, the Foundation and the Shares.
2. Representations and Warranties.
--
The Company and the Bank jointly and severally represent and warrant to
Trident as follows:
a. The Registration Statement has been declared effective by the
Commission, no stop order has been issued with respect thereto and no
proceedings therefor have been initiated or, to the knowledge of the
Company and the Bank, threatened by the Commission. At the time the
Registration Statement became effective and at all times subsequent
thereto through and including the Closing Date referred to in Section
4 below, the Registration Statement (as amended or supplemented)
complied and will comply in all material respects with the
requirements of the Securities Act and the Securities Act Regulations
and did not and will not contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading. At the date
of the Prospectus and at all times subsequent thereto through and
including the Closing Date (as hereinafter defined), the Prospectus
(as amended or supplemented) complied and will comply in all material
respects with the Conversion Regulations and the Prospectus did not
and will not include an 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 under which they were made,
not misleading. Representations or warranties in this subsection shall
not apply to statements or omissions made in reliance upon and in
conformity with written information furnished to the Company relating
to Trident by or on behalf of Trident expressly for use in the
Prospectus or the Registration Statement.
b. As of the Closing Date, the Bank will have completed all conditions
precedent to its conversion from the mutual to stock form in
accordance with the Plan, the Conversion Regulations and all other
applicable laws, regulations, decisions and orders. The Plan has been
approved by the Commissioner of Banks of The Commonwealth of
Massachusetts (the "Commissioner") and has been reviewed
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without objection by the Federal Deposit Insurance Corporation
("FDIC"), subject to conditions customarily imposed in such non-
objection letters, and no person has challenged or sought to obtain
judicial review of the action of the Commissioner in approving the
Plan and the Conversion.
c. The Bank has filed an Application for Conversion including (i) the
Prospectus; (ii) a Notice and Information Statement relating to the
Special Meeting of the Bank's depositors (as amended or supplemented,
the "Notice"); and (iii) certain exhibits (such Application for
Conversion, Prospectus, Notice and exhibits, as amended or
supplemented, shall sometimes be referred to collectively herein as
the "Conversion Application"). By letter dated ___________, 1998, the
Commissioner has approved the Conversion Application, such approval
remains in full force and effect and no order has been issued by the
Commissioner suspending or revoking such approval and no proceedings
therefor have been initiated or, to the knowledge of the Company or
the Bank, threatened by the Commissioner.
d. The Commissioner has not, by order or otherwise, prevented or
suspended the use of the Prospectus or any supplemental sales
literature authorized by the Company or the Bank for use in connection
with the Offerings.
e. As of the Closing Date, the Company will have completed all conditions
precedent to its registration as a savings and loan holding company.
The Company has filed an application on Form H-(e)1 (the "Holding
Company Application") with the Office of Thrift Supervision (the
"OTS") for approval to acquire the Bank and become a savings and loan
holding company and has received written notice from the OTS of its
approval of the Holding Company Application.
f. The Bank is now a Massachusetts-chartered co-operative bank of mutual
form of organization and upon the Conversion will be a Massachusetts-
chartered co-operative bank of capital stock form of organization, in
both instances duly licensed to conduct its business as described in
the Prospectus. Each of the Bank and the Bank Subsidiaries
(hereinafter defined) is in good standing under the laws of The
Commonwealth of Massachusetts and is not required to qualify as a
foreign corporation in any jurisdiction. The Bank is a member in good
standing of the Federal Home Loan Bank of Boston (the "FHLB of
Boston") and the Co-operative Central Bank (the "Central Bank"). The
deposit accounts of the Bank are insured by the Bank Insurance Fund of
the FDIC up to the applicable
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limits, and deposits not insured by the FDIC are insured by the Share
Insurance Fund of the Central Bank. Upon the Conversion, the
liquidation account for the benefit of eligible account holders and
supplemental eligible account holders will be duly established in
accordance with the requirements of the Conversion Regulations. The
Bank does not own equity securities of, or an equity interest in, any
business enterprise, except as described in the Prospectus and except
for equity securities held in its investment portfolio representing
not more than 5% of the equity interest in any business entity.
g. The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Delaware
with corporate power and authority to own, lease and operate its
properties and to conduct its business as described in the Prospectus
and to enter into and perform its obligations under this Agreement.
The Company is duly qualified as a foreign corporation to transact
business and is in good standing in The Commonwealth of Massachusetts
and in all other jurisdictions in which such qualification is
required, whether by reason of the ownership or leasing of property or
the conduct of business.
h. As of the Closing Date, the Company will not directly own any
subsidiaries other than the Bank. The Bank's only subsidiaries (other
than, prior to the Closing Date, the Company) are Mass Securities
Corporation and Mass SEC Corp. II (the "Bank Subsidiaries").
i. Each of the Company, the Bank and the Bank Subsidiaries has obtained
all licenses, permits and other governmental authorizations currently
required for the conduct of its business or as required for the
conduct of its business as contemplated by the Conversion Application
and the Holding Company Application; all such licenses, permits and
other governmental authorizations are in full force and effect; and
each of the Company, the Bank and the Bank Subsidiaries is in all
material respects complying therewith.
j. Each of the Company, the Bank and the Bank Subsidiaries has good,
marketable and insurable title to all assets material to its business
and to those assets described in the Prospectus as owned by it, free
and clear of all material liens, charges, encumbrances or
restrictions, except for liens for taxes not yet due, except as
described in the Prospectus and except as could not in the aggregate
have a material adverse effect upon the operations or financial
condition of the Company, the Bank and the Bank Subsidiaries, taken as
a whole. All of the leases and subleases material to the operations or
financial condition of the Company,
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the Bank and the Bank Subsidiaries, taken as a whole, under which the
Company, the Bank or the Bank Subsidiaries holds properties, including
those described in the Prospectus, are in full force and effect as
described therein.
k. The execution and delivery of this Agreement and the consummation of
the transactions contemplated hereby and all actions in connection
with the contribution of Foundation Shares to the Foundation have been
duly and validly authorized by all necessary actions on the part of
each of the Company and the Bank, and this Agreement is a valid and
binding obligation of each of the Company and the Bank, enforceable in
accordance with its terms (except as the enforceability thereof may be
limited by bankruptcy, insolvency, moratorium, reorganization or
similar laws relating to or affecting the enforcement of creditors'
rights generally or the rights of creditors of financial institutions,
the accounts of which are insured by the FDIC or by general equity
principles, regardless of whether such enforceability is considered in
a proceeding in equity or at law, and except to the extent that the
provisions of Section 7 hereof may be unenforceable as against public
policy).
l. There is no litigation or governmental proceeding pending or, to the
best knowledge of any of the Company, the Bank or the Bank
Subsidiaries, threatened against or involving the Company, the Bank or
the Bank Subsidiaries or their assets which individually or in the
aggregate would reasonably be expected to have a material adverse
effect on the condition (financial or otherwise), results of
operations and business, including the assets and properties, of the
Company, the Bank or the Bank Subsidiaries.
m. The Bank has received the opinion of Xxxxxxx, Xxxxxx & Xxxxxxxx with
respect to federal tax consequences of the Conversion to the effect
that the Conversion will constitute a tax-free reorganization under
the Internal Revenue Code of 1986, as amended. The Bank has also
received the opinion of Xxxxx Xxxxxxxx LLP that the Conversion will
not be a taxable transaction for the Bank under the laws of The
Commonwealth of Massachusetts. The Bank and the Company have received
the opinion of Xxxxx Xxxxxxxx LLP that the contribution of Foundation
Shares to the Foundation will not constitute an act of self-dealing,
and that the Company will be entitled to a deduction in the amount of
the fair market value of the Foundation Shares contributed at the time
of the contribution less the nominal par value that the Foundation is
required to pay the Company for such Foundation Shares, subject to a
limitation based on 10% of the Company's annual taxable income before
the charitable contribution deduction. The facts relied upon in
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such opinions are accurate and complete.
n. Each of the Company and the Bank has all such corporate power,
authority, authorizations, approvals and orders as may be required to
enter into this Agreement and to carry out the provisions and
conditions hereof, subject to the limitations set forth herein and
subject to the satisfaction of certain conditions imposed by the
Commissioner in connection with his approval of the Conversion
Application, and except as may be required under the securities, or
"blue sky," laws of various jurisdictions. As of the Closing Date, the
Company will have such approvals and orders to issue and sell the
Shares to be sold by the Company as provided herein, and as provided
in the Plan, subject to the issuance of an amended charter of the Bank
in the form required for Massachusetts-chartered capital stock co-
operative banks (the "Stock Charter"), the form of which Stock Charter
has been approved by the Commissioner.
o. Each of the Company and the Bank has the corporate powers and
authority to establish the Foundation and contribute the Foundation
Shares.
p. To the best of its knowledge, the Bank is not in violation of any rule
or regulation of The Commonwealth of Massachusetts or the FDIC that
could reasonably be expected to result in any enforcement action
against the Bank or its officers or directors that might have a
material adverse effect on the condition (financial or otherwise),
operations, businesses, assets or properties of the Bank.
q. The financial statements and any related notes or schedules which are
included in the Prospectus and the Registration Statement fairly
present the balance sheets, income and comprehensive income, changes
in surplus and cash flows of the Bank at the respective dates thereof
and for the respective periods covered thereby and comply as to form
with the applicable accounting requirements of the Conversion
Regulations and the Securities Act Regulations. Such financial
statements have been prepared in accordance with generally accepted
accounting principles ("GAAP") consistently applied throughout the
periods involved, except as set forth therein, and such financial
statements are consistent with financial statements and other reports
filed by the Bank with supervisory and regulatory authorities. The
tables in the Prospectus and the Registration Statement accurately
present the information purported to be shown thereby at the
respective dates thereof and for the respective periods therein.
r. There has been no material change in the condition (financial or
otherwise),
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results of operations or business, including the assets and
properties, of the Company, the Bank or the Bank Subsidiaries, since
the latest date as of which such condition is set forth in the
Prospectus and the Registration Statement, except as set forth
therein. The capitalization, assets, properties and business of the
Company, the Bank and the Bank Subsidiaries conform to the
descriptions thereof contained in the Prospectus and the Registration
Statement. The Company, the Bank and the Bank Subsidiaries have no
material liabilities of any kind, contingent or otherwise, except as
set forth in the Prospectus and the Registration Statement.
s. There has been no breach or default (or the occurrence of any event
which, with notice or lapse of time or both, would constitute a
default) under, or creation or imposition of any lien, charge or other
encumbrance upon any of the properties or assets of the Company, the
Bank or the Bank Subsidiaries pursuant to any of the terms, provisions
or conditions of, any agreement, contract, indenture, bond, debenture,
note, instrument or obligation to which the Company, the Bank or the
Bank Subsidiaries is a party or by which it or any of its respective
assets or properties may be bound or is subject, or violation of any
governmental license or permit or any enforceable published law,
administrative regulation or order or court order, writ, injunction or
decree, which breach, default, encumbrance or violation would have a
material adverse effect on the condition (financial or otherwise),
operations, business, assets or properties of the Company, the Bank or
the Bank Subsidiaries. All agreements which are material to the
condition (financial or other wise), results of operations or business
of the Company, the Bank and the Bank Subsidiaries are in full force
and effect, and no party to any such agreement has instituted or, to
the best knowledge of the Company, the Bank or the Bank Subsidiaries,
threatened, any action or proceeding wherein the Company, the Bank or
the Bank Subsidiaries would be alleged to be in default thereunder.
t. The Bank is not in violation of its mutual charter or bylaws. The
execution and delivery hereof and the consummation of the transactions
contemplated hereby by the Bank do not conflict with or result in a
breach of the charter or bylaws of the Bank (in either mutual or stock
form) or constitute a material breach of or default (or an event
which, with notice or lapse of time or both, would constitute a
default) under, give rise to any right of termination, cancellation or
acceleration contained in, or result in the creation or imposition of
any lien, charge or other encumbrance upon any of the properties or
assets of the Bank, pursuant to any of the terms, provisions or
conditions of, any material agreement, contract,
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xxxxxxxxx, xxxx, xxxxxxxxx, note, instrument or obligation to which the
Bank is a party or violate any governmental license or permit or any law,
administrative regulation or order or court order, writ, injunction or
decree, which breach, default, encumbrance or violation would have a
material adverse effect on the condition (financial or otherwise),
operations, business, assets or properties of the Bank.
u. The Company is not in violation of its certificate of incorporation or
bylaws. The execution and delivery hereof and the consummation of the
transactions contemplated hereby by the Company do not conflict with or
result in a breach of the certificate of incorporation or bylaws of the
Company or constitute a material breach of or default (or an event which,
with notice or lapse of time or both, would constitute a default) under,
give rise to any right of termination, cancellation or acceleration
contained in, or result in the creation or imposition of any lien, charge
or other encumbrance upon any of the properties or assets of the Company,
pursuant to any of the terms, provisions or conditions of, any material
agreement, contract, indenture, bond, debenture, note, instrument or
obligation to which the Company is a party or violate any governmental
license or permit or any law, administrative regulation or order or court
order, writ, injunction or decree, which breach, default, encumbrance or
violation would have a material adverse effect on the condition (financial
or otherwise), operations business, assets or properties of the Company.
v. Subsequent to the respective dates as of which information is given in the
Prospectus and the Registration Statement and prior to the Closing Date,
except as otherwise may be indicated or contemplated therein, none of the
Company, the Bank or the Bank Subsidiaries will have issued any securities
which will remain issued at the Closing Date or incurred any liability or
obligation, direct or contingent, or borrowed money, except borrowings in
the ordinary course of business, or entered into any other transaction not
in the ordinary course of business and consistent with prior practices,
which is material in light of the business of the Company, the Bank and the
Bank Subsidiaries, taken as a whole.
w. Upon consummation of the Conversion, the authorized, issued and outstanding
equity capital of the Company shall be within the range as set forth in the
Prospectus under the caption "CAPITALIZATION," and no Common Stock of the
Company shall be outstanding immediately prior to the Closing Date, other
than shares issued to the Bank, which will be canceled upon the Closing (as
hereinafter defined). The issuance and the sale of the Shares of the
Company
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have been duly authorized by all necessary action of the Company and,
when issued in accordance with the terms of the Plan and paid for,
shall be validly issued, fully paid and nonassessable and shall
conform to the description thereof contained in the Prospectus. The
issuance of the Shares is not subject to preemptive rights, except as
set forth in the Prospectus, and good title to the Shares will be
transferred by the Company upon issuance thereof against payment
therefor, free and clear of all claims, encumbrances, security
interests and liens against the Company whatsoever. The certificates
representing the Shares will conform in all material respects with the
requirements of applicable laws and regulations.
x. Upon consummation of the Conversion, the authorized equity capital of
the Bank shall be 3,000,000 shares of capital stock, of which
2,500,000 shares will be common stock, par value $0.01 per share (the
"Bank Common Stock"), and 500,000 shares will be serial preferred
stock, par value $0.01 per share, of which no shares will be issued
and outstanding. No shares of Bank Common Stock or Bank preferred
stock have been or will be issued prior to the Closing Date. At the
time of the Closing, the Bank Common Stock will have been duly
authorized for issuance by all necessary action of the Bank and
approved by the Commissioner and, when issued in accordance with the
terms of the Plan and paid for, shall be validly issued, fully paid
and nonassessable. The issuance of the Bank Common Stock is not
subject to preemptive rights, and good title to the Bank Common Stock
will be transferred by the Bank upon issuance thereof against payment
therefor, free and clear of all claims, encumbrances, security
interests and liens against the Bank whatsoever. The certificate(s)
representing the Bank Common Stock will conform in all material
respects with the requirements of applicable laws and regulations.
y. No approval of any regulatory or supervisory or other public authority
is required in connection with the execution and delivery of this
Agreement or the issuance of the Shares, except for compliance with
certain conditions imposed in the approval of the Conversion
Application and the Plan by the Commissioner, the declaration of
effectiveness of any required post-effective amendment by the
Commission, the issuance of the Stock Charter by the Commissioner,
compliance with any conditions imposed by the OTS in its approval of
the Holding Company Application, compliance with certain conditions
imposed in the review of the Plan without objection by the FDIC and as
may be required under the securities laws of various jurisdictions.
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z. All contracts and other documents required to be filed as exhibits to
the Conversion Application and the Holding Company Application or as
required by the Commissioner, the FDIC or the OTS have been filed with
the Commissioner, the FDIC and/or the OTS, as the case may be.
aa. All contracts and other documents required to be filed as exhibits to
the Registration Statement have been filed with the Commission.
bb. Wolf & Company, P.C. ("Wolf"), who have audited the financial
statements of the Bank as of December 31, 1997 and 1996, and for each
of the years in the three-year period ended December 31, 1997,
included in the Prospectus and the Registration Statement, are
independent public accountants within the meaning of the Code of
Professional Ethics of the American Institute of Certified Public
Accountants and Title 12 of the Code of Federal Regulations, Section
335.604(a) of the FDIC's securities disclosure regulations.
cc. FinPro, Inc. (the "Appraiser") which prepared the appraisal of the pro
forma market value of the Shares, is independent with respect to the
Bank within the meaning of the Conversion Regulations, and has so
advised the Bank.
dd. The Bank and the Bank Subsidiaries have timely filed all required
federal, state and local franchise tax returns, and the Bank has no
knowledge of any tax deficiency which has been asserted with respect
to such returns by any taxing authorities. The Bank and the Bank
Subsidiaries have paid all taxes that have become due and, to the best
of their knowledge, have made adequate reserves for similar future tax
liabilities, except where any failure to make such filings, payments
and reserves, or the assertion of such a deficiency, would not have a
material adverse effect on the condition of the Bank and the Bank
Subsidiaries.
ee. All of the loans represented as assets of the Bank on the most recent
financial statements of the Bank included in the Prospectus and the
Registration Statement meet or are exempt from all requirements of
federal, state or local law pertaining to lending, including without
limitation truth in lending (including the requirements of Regulation
Z and 12 C.F.R. Part 226 and Section 563.99), real estate settlement
procedures, consumer credit protection, equal credit opportunity and
all disclosure laws applicable to such loans, except for violations
which, if asserted, would not have a material adverse effect on the
Bank.
ff. The records of account holders, depositors and other members of the
Bank
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delivered to Trident by the Bank or its agent for use during the
Conversion have been prepared or reviewed by the Bank and, to the best
knowledge of the Bank, are reliable and accurate.
gg. None of the Company, the Bank or the Bank Subsidiaries, or the
employees of the Company, the Bank or the Bank Subsidiaries has made
any payment of funds of the Company, the Bank or the Bank Subsidiaries
prohibited by law, and no funds of the Company, the Bank or the Bank
Subsidiaries have been set aside to be used for any payment prohibited
by law.
hh. To the best knowledge of the Company, the Bank and the Bank
Subsidiaries, the Company, the Bank and the Bank Subsidiaries are in
compliance with all laws, rules and regulations relating to the
discharge, storage, handling and disposal of hazardous or toxic
substances, pollutants or contaminants and none of the Company, the
Bank or the Bank Subsidiaries believes that the Company, the Bank or
the Bank Subsidiaries are subject to liability under the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as
amended, or any similar law, except for violations which, if asserted,
would not have a material adverse effect on the Company, the Bank and
the Bank Subsidiaries, taken as a whole. There are no actions, suits,
regulatory investigations or other proceedings pending or, to the best
knowledge of the Company, the Bank and the Bank Subsidiaries,
threatened against the Company, the Bank or the Bank Subsidiaries
relating to the discharge, storage, handling or disposal of hazardous
or toxic substances, pollutants or contaminants. To the best knowledge
of the Company, the Bank and the Bank Subsidiaries, no disposal,
release or discharge of hazardous or toxic substances, pollutants or
contaminants, including petroleum and gas products, as any of such
terms may be defined under federal, state or local law, has been
caused by the Company, the Bank or the Bank Subsidiaries or, to the
best knowledge of the Company, the Bank or the Bank Subsidiaries, has
occurred on, in or at any of the facilities or properties of the
Company, the Bank or the Bank Subsidiaries, except such disposal,
release or discharge which would not have a material adverse effect on
the Company, the Bank or the Bank Subsidiaries, taken as a whole.
ii. At the Closing Date, the Company and the Bank will have completed the
conditions precedent to, and shall have conducted the Conversion in
all material respects in accordance with, the Plan, the Conversion
Regulations, the Securities Act, the Securities Act Regulations and
all other applicable laws, regulations, published decisions and
orders, including all terms, conditions, requirements and
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provisions precedent to the Conversion imposed by the Commissioner,
the FDIC and the OTS in their approval and review without objection of
the Plan, the Conversion Application and the Holding Company
Application, as applicable.
jj. Upon completion of the Conversion, the Foundation will be duly
incorporated and validly existing as a non-stock corporation in good
standing under the laws of the State of Delaware. All approvals
required to contribute the Foundation Shares to the Foundation shall
have been received, except as specifically disclosed in the
Prospectus. The Foundation Shares will have been duly authorized for
issuance and pursuant to the Plan, will be duly and validly issued and
fully-paid and non-assessable.
Any closing certificate signed by any officer of the Company, the Bank or
the Bank Subsidiaries and delivered to Trident or Trident's counsel that
contains a representation or warranty shall be deemed a representation and
warranty of the Company, the Bank or the Bank Subsidiaries, as applicable, to
Trident as to the matters covered thereby.
3. Agency. On the basis of the representations and warranties herein
-
contained, but subject to the terms and conditions herein set forth, the
Company and the Bank hereby agree with Trident as follows:
a. Assistance with Conversion. The Company and the Bank hereby employ
---------------------------
Trident to assist the Company and the Bank on a best efforts basis in
the offer and sale of the Shares in the Conversion by assisting in:
i. training and educating the employees of the Bank regarding the
mechanics and regulatory requirements of the conversion process;
ii. conducting information meetings for the employees of the Bank,
depositors of the Bank and the general public, if desired by the
Bank;
iii. coordinating the selling efforts in the local communities of the
Bank, if desired by the Bank; and
iv. keeping records of all subscriptions for the Shares.
b. Assistance with the Direct Community Offering and the Syndicated
----------------------------------------------------------------
Offering. The Company and the Bank hereby employ Trident to act as
--------
their exclusive agent to utilize its best efforts in managing the sale
of the Shares in the Direct
Trident Securities, Inc.
Sales Agency Agreement
Page 14
Community Offering and the Syndicated Offering; provided, however,
that the Company and the Bank acknowledge and agree that Trident may
offer to other NASD-registered broker dealers ("Selected Dealers") the
opportunity to solicit subscriptions for the Shares to be sold in the
Syndicated Offering on a best efforts basis pursuant to the terms and
conditions of the Selected Dealers' agreements between Trident and
each of the Selected Dealers (the "Selected Dealers' Agreement").
c. Other Matters. Subscriptions shall be submitted in the Subscription
-------------
Offering only during the subscription period by means of order forms
as described in the Prospectus (the "Order Forms"), and may be
submitted in the Direct Community Offering and the Syndicated
Community Offering by means of Order Forms or by solicitation of
indications of interest from customers of Selected Dealers residing in
those states where the Common Stock is registered or is exempt from
registration. The Company shall notify Trident promptly after the
expiration of the Subscription Offering of the number of Shares sold
in the Subscription Offering and the aggregate number of Shares
remaining that are available to be sold in the Direct Community
Offering or the Syndicated Offering, if any. The Company shall advise
Trident as to the allocation of the Shares in the event of an
oversubscription and shall provide Trident with final instructions
(the "Allocation Instructions") as to the allocation of the Shares in
such event. Trident shall be entitled to rely on such Allocation
Instructions and shall have no liability in respect of its reliance
thereon, including without limitation, no liability for or related to
any denial or grant, full or partial, of a subscription unless
liability resulting from such denial or grant is due to Trident's
gross negligence or willful disregard of the Allocation Instructions.
The Company shall indemnify and hold harmless Trident against any
losses, claims, damages or liabilities resulting from Trident's
reliance on the Allocation Instructions or from the failure of the
Company or the Bank (or their agents) to properly record stock orders,
to properly credit subscription rights of Eligible Account Holders or
Supplemental Eligible Account Holders, to properly allocate Shares in
the event of an oversubscription or to otherwise properly deal with or
account for any records of qualifying deposit account holders of the
Bank during the Conversion.
d. Fees and Expenses.
-----------------
i. As compensation for Trident's services hereunder, the Company
agrees to pay to Trident a management fee of $10,000 and a
commission equal to 2.0% of the aggregate dollar amount of the
Shares sold in the Offerings
Trident Securities, Inc.
Sales Agency Agreement
Page 15
excluding any Shares sold to the Employee Plans, directors and
executive officers and "associates" of the Bank's directors and
executive officers. All fees and commissions shall be payable to
Trident on the Closing Date, in next day funds.
ii. In addition to the fees described in (i) above, the Company and the
Bank agree to reimburse Trident for all allocable out-of-pocket
expenses, including travel, communication, legal fees and postage (up
to an aggregate of $45,000) incurred by Trident in connection with the
Conversion. The expenses to be reimbursed hereunder shall be payable
by the Company or the Bank as they are incurred by Trident and billed
on a periodic basis to the Company or the Bank, and shall be payable
regardless of whether the Closing occurs or this Agreement is
terminated in accordance with paragraph (e) of this Section 3. To the
extent not previously paid, full payment of Trident's expenses shall
be made in same day funds at the Closing and any expenses and fees
incurred by Trident or its counsel but not billed as of the Closing
shall subsequently be payable in full upon receipt of such xxxxxxxx.
iii. Regardless of whether the Closing occurs or this Agreement is
terminated in accordance with paragraph (e) of this Section 3 and in
addition to the obligations under clauses (i) and (ii) hereof, each of
the Company and the Bank shall pay all expenses incident to the
performance of its obligations in connection with the Conversion
including, but not limited to, all fees and disbursements of its
counsel, the Appraiser and the conversion agent, all expenses incurred
in the preparation, printing, filing and distribution of all documents
relating to the Conversion (including all NASD filing fees), telephone
charges, air freight, rental equipment, supplies, marketing materials,
all fees and expenses of the transfer agent of the Company and all
transfer taxes that may be payable with respect to the sale of the
Common Stock, all fees of the accountants of the Bank, and all legal
and filing fees incurred in connection with the matters referred to in
Section 5(d) hereof. Any expenses to be reimbursed to Trident pursuant
to this clause (iii) shall be in addition to, and not subject to, the
limitations on, the expenses to be reimbursed to Trident pursuant to
clause (ii) above.
iv. Notwithstanding the limitations on reimbursement of Trident for
allocable expenses provided in clause (ii) above, in the event that a
resolicitation or other event causes the Offerings to be extended
beyond their original
Trident Securities, Inc.
Sales Agency Agreement
Page 16
expiration date, Trident shall be reimbursed for its reasonable
allocable expenses incurred during such extended period, provided
that the allowance for allocable expenses provided for in clause
(ii) above has been exhausted and subject to the following: such
reimbursement shall be an amount equal to the lesser of (a)
$10,000, or (b) the product obtained by dividing $45,000 by the
total number of days of the unextended Subscription Offering
(calculated from the date of the Prospectus to the intended close
of the Subscription Offering as stated in the Prospectus) and
multiplying such product by the number of days of the extension
(that number of days from the date of the supplemental prospectus
used in the extended Subscription Offering to the closing of the
extension of the Subscription Offering described in such
supplemental prospectus).
v. In the event of a Syndicated Community Offering, Trident,
pursuant to a Selected Dealers' Agreement will assemble a
syndicate of brokers-dealers to assist with the placement of
Shares. Trident and other NASD members who are parties to the
Selected Dealers' Agreement will be paid a commission which shall
not exceed a fee to be agreed upon jointly by Trident and the
Bank to reflect market requirements at the time of the stock
allocation in the Syndicated Community Offering.
e. Termination. The employment of Trident hereunder shall terminate
-----------
upon the first to occur of the following: (i) the forty-fifth day
after the expiration of the Subscription Offering, as extended, unless
the Bank with the approval of the Commissioner, is permitted to extend
such date; (ii) the Closing; or (iii) the termination of this
Agreement pursuant to Section 9 hereof
4. Closing.
-------
a. Subject to the terms and conditions set forth herein, the closing of
the purchase and sale of the Common Stock (the "Closing") shall take
place at the offices of Xxxxxxx, Xxxxxx & Xxxxxxxx, Washington, D.C.,
at 10:00 a.m., Washington, D.C. time, on a business day that shall be
agreed upon by the parties hereto (the "Closing Date"). At the
Closing, the Common Stock will be issued by the Company against
payment of the purchase price therefor. Certificates representing the
Common Stock shall be prepared in definitive form and in such
denominations and registered in such names as set forth on the Order
Forms or (in the case of Shares not subscribed for pursuant to Order
Forms) in such names as Trident may request, upon at least two
business days' prior notice to the
Trident Securities, Inc.
Sales Agency Agreement
Page 17
Company, and will be (i) in the case of Shares subscribed for pursuant
to Order Forms, delivered by the Company or its agent directly to the
purchasers thereof as promptly as practicable following the Closing,
and (ii) in the case of Shares not subscribed for pursuant to Order
Forms, made available for checking and packaging at least one business
day prior to the Closing at a location to be designated by Trident.
b. Pursuant to the Conversion Regulations, prior to the commencement of
the Offerings, appropriate arrangements will be made for placing the
funds received in payment for the shares of Common Stock in special
interest-bearing segregated accounts (the "Segregated Accounts") with
the Bank until such shares are sold and paid for at the Closing. If
the Closing does not occur within the time specified in Section
3(e)(i) of this Agreement, the Bank will promptly refund all funds,
including interest, in the Segregated Accounts to the persons who have
the beneficial interests therein, unless alternative arrangements are
agreed to by the parties and approved by the Commissioner and the
FDIC.
5. Covenants of the Company and the Bank. Each of the Company and the Bank
--
covenants and agrees with Trident as follows:
a. The Company and the Bank will prepare and file such amendments or
supplements to the Registration Statement, the Prospectus, the
Conversion Application and the Notice as may hereafter be required by
the Securities Act Regulations or the Conversion Regulations or as may
hereafter be reasonably requested by Trident. Following completion of
the Subscription Offering and the Direct Community Offering, in the
event of a Syndicated Offering, the Company and the Bank will (i)
promptly prepare and file with the Commission a post-effective
amendment to the Registration Statement relating to the results of the
Subscription Offering and the Direct Community Offering, any
additional information with respect to the proposed plan of
distribution and any revised pricing information or (ii) if no such
post-effective amendment is required, file with, or mail for filing
to, the Commission a prospectus or prospectus supplement containing
information relating to the results of the Subscription Offering and
the Direct Community Offering and pricing information pursuant to Rule
424(c) of the Securities Act Regulations, in either case in a form
acceptable to Trident.
b. The Company and the Bank will notify Trident immediately, and confirm
the notice in writing of, (i) the effectiveness of any post-effective
amendment to the Registration Statement, the filing of any supplement
or amendment to the
Trident Securities, Inc.
Sales Agency Agreement
Page 18
Prospectus, and the receipt of any approval relating to the Conversion
Application, (ii) the receipt of any comments from the Commissioner,
the FDIC or the Commission with respect to the Prospectus, the
Conversion Application or the transactions contemplated by this
Agreement or the Plan, (iii) any request by the Commission, the
Commissioner or the FDIC for any amendment to the Registration
Statement or the Conversion Application or any amendment or supplement
to the Prospectus or for additional information, (iv) the issuance by
the Commissioner of any order suspending the Offerings or the use of
the Prospectus or the initiation of any proceedings for that purpose,
(v) the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or the initiation of any
proceedings for that purpose, (vi) the receipt of any notice with
respect to the suspension of any qualification of the Common Stock for
offering or sale in any jurisdiction, and (vii) the receipt of any
comments from the OTS with respect to the Holding Company Application.
The Company and the Bank will make every reasonable effort to prevent
the issuance of any stop order and, if any stop order is issued, to
obtain the lifting thereof at the earliest possible moment.
c. The Company and the Bank will give Trident prompt notice of its
intention to file any amendment to the Holding Company Application,
the Conversion Application or the Registration Statement (including
any post-effective amendment) or any amendment or supplement to the
Prospectus (including any revised prospectus that the Company proposes
for use in connection with the Syndicated Offering that differs from
the prospectus on file at the Commission at the time the Registration
Statement becomes effective, whether or not such revised prospectus is
required to be filed pursuant to Rule 424(b) of the Securities Act
Regulations), will furnish Trident with copies of any such amendment
or supplement a reasonable amount of time prior to such proposed
filing or use, as the case may be, and will not file any such
amendment or supplement or use any such prospectus to which Trident or
counsel for Trident may reasonably object.
d. The Company or the Bank has furnished or will furnish to Trident
copies of the Conversion Application, and each amendment thereto (one
of each of which will include all exhibits), the Prospectus and all
amendments and supplements thereto, the Registration Statement and all
amendments and supplements thereto, and the Holding Company
Application and all amendments and supplements thereto, in each case
as soon as available and in such quantities as Trident may from time
to time reasonably request.
Trident Securities, Inc.
Sales Agency Agreement
Page 19
e. During the period when the Prospectus is required to be delivered, the
Company and the Bank will comply, at their own expense, with all
requirements imposed upon them by the Commissioner, the FDIC, the
Conversion Regulations, and the Securities Act, the Securities Act
Regulations, the Securities Exchange Act of 1934 (the "Exchange Act")
and the rules and regulations of the Commission promulgated
thereunder, including, without limitation, Rule l0b-6 under the
Exchange Act, so far as necessary to permit the continuance of sales
or dealing in shares of Common Stock during such period in accordance
with the provisions hereof and the Prospectus.
f. If during the Offerings any event occurs as a result of which the
Prospectus, as then amended or supplemented, would include an untrue
statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statement
therein, in light of the circumstances then existing, not misleading,
or if during such period it is necessary to amend or supplement the
Conversion Application or the Prospectus to comply with the Conversion
Regulations or the Securities Act Regulations, the Company promptly
will notify Trident and will prepare and file with the Commissioner,
the FDIC and the Commission and any other authority with jurisdiction,
an amendment or supplement that will correct such statement or
omission or effect such compliance.
g. The Company and the Bank have taken or will take all necessary action
to qualify or obtain an exemption for the Common Stock for offer and
sale under the securities laws of such jurisdictions as Trident and
the Company may agree upon and to continue such qualifications or
exemptions in effect so long as required for the distribution of the
Common Stock pursuant to the Conversion; provided, however, that the
Company shall not be obligated in connection therewith to execute any
general consent to service of process or to qualify as a foreign
corporation to do business under the laws of any such jurisdiction.
The Company shall notify Trident immediately of the suspension of
qualification of the Common Stock or the threat of such action, in any
jurisdiction, of which the Company becomes aware. The Company shall
comply in all material respects with the undertakings, if any, given
by it in connection with the qualification of the Common Stock for
offer and sale under laws of such jurisdictions.
h. The Company authorizes Trident and any Selected Dealers to act as
agent of the Company in distributing the Prospectus to persons
entitled to subscription rights and other persons having record
addresses in the states or jurisdictions set forth in
Trident Securities, Inc.
Sales Agency Agreement
Page 20
a survey of the securities or "blue sky" laws of the various
jurisdictions in which the Offerings will be made (the "Blue Sky
Survey").
i. The Company will make generally available to its security holders as
soon as practicable but no later than sixty (60) days from the close
of the period covered thereby an earnings statement (in compliance
with the provisions of Rule 158 of the Securities Act Regulations)
covering a twelve month period beginning not later than the first day
of the Company's fiscal quarter next following the "effective date"
(as defined in Rule 158) of the Registration Statement.
j. During the period ending on the third anniversary of the expiration of
the fiscal year during which the Closing occurs, the Company will
furnish to its stockholders as soon as practicable after the end of
each such fiscal year an annual report (including consolidated
statements of financial condition and consolidated statements of
income, stockholders' equity and cash flows of the Company, the Bank
and any subsidiaries, certified by independent public accountants)
and, as soon as practicable after the end of each of the first three
quarters of each fiscal year (beginning with the fiscal quarter ending
after the effective date of the Registration Statement), consolidated
summary financial information of the Company, the Bank and any
subsidiaries for such quarter in reasonable detail. In addition, such
annual report and quarterly consolidated summary financial information
shall be made public through the issuance of appropriate press
releases at the same time or prior to the time of the furnishing
thereof to stockholders of the Company.
k. During the period ending on the third anniversary of the expiration of
the fiscal year during which the Closing occurs, the Company will
furnish to Trident (i) as soon as available, a copy of each report or
other document of the Company furnished generally to stockholders of
the Company or furnished to or filed with the Commission under the
1934 Act or any national securities exchange or system on which any
class of securities of the Company is listed, and (ii) from time to
time, such other public information concerning the Company as Trident
may reasonably request.
l. The Company and the Bank will conduct the Conversion in all material
respects in accordance with the Plan, the Conversion Regulations and
all other applicable regulations, decisions and orders thereunder,
including all applicable terms, requirements and conditions precedent
to the Conversion imposed upon the Company or the Bank by the
Commissioner, the FDIC or the OTS.
Trident Securities, Inc.
Sales Agency Agreement
Page 21
m. Each of the Company and the Bank will use the net proceeds received by
it from the sale of the Common Stock in the manner specified in the
Prospectus under "USE OF PROCEEDS."
n. The Company will report the use of proceeds of the Offerings pursuant
to the requirements of Rule 463 of the Securities Act Regulations.
o. The Company will file a registration statement for the Common Stock
under Section 12(g) of the Exchange Act prior to completion of the
Offerings and will request that such registration statement be
effective upon completion of the Conversion. The Company will maintain
the effectiveness of such registration for not less than three years.
The Company will file with the National Quotation Bureau, Inc. all
documents and notices required by the National Quotation Bureau, Inc.
of companies that have issued securities that are traded in the over-
the-counter market and quotations for which are reported by the
National Daily Quotation Service "Pink Sheet."
p. The Company and the Bank will take such actions and furnish such
information as are reasonably requested by Trident in order for
Trident to ensure compliance with the NASD's "Interpretation Relating
to Free-Riding and Withholding."
q. The Company and the Bank will comply with, or cause to be complied
with, the conditions to Trident's obligations set forth in Section 6
hereof unless such conditions are waived in writing by Trident and
shall not deliver the Shares until each and every condition set forth
in Section 6 hereof has been satisfied, unless such condition is
waived in writing by Trident.
r. The Company will promptly prepare and file with the Commissioner, the
Commission, the FDIC, the OTS and any other appropriate regulatory
agency such reports or documents as may be required by the Conversion
Regulations, the Securities Act and rules and regulations promulgated
thereunder and other applicable laws and regulations to be filed with
such agencies, including, without limitation, reports with respect to
the sale of the Common Stock and the application of the proceeds
thereof.
s. The Company will not sell or issue, contract to sell or otherwise
dispose of, for a period of 180 days after the Closing Date, without
Trident's prior written consent, any shares of Common Stock other than
in connection with the Offerings or in
Trident Securities, Inc.
Sales Agency Agreement
Page 22
connection with any employee benefit plan or arrangement described in
the Prospectus.
t. The Company and the Bank agree that their counsel will undertake the
obligations customarily undertaken by underwriters and their counsel
with respect to preparation and delivery of the Blue Sky Survey
setting forth the registration and other filing requirements of (or
exemptions from) the securities laws of the states in which the
Offerings are being made.
6. Conditions to Trident's Obligations. Except as may be waived in writing by
Trident, the obligations of Trident as provided herein shall be subject to
the accuracy, as of the date hereof and at the Closing Date (as if made at
the Closing Date), of the representations and warranties of the Company and
the Bank herein, to the performance by the Company and the Bank of their
respective obligations hereunder and to the following additional
conditions:
a. The Prospectus and all supplemental sales literature shall have
received all required authorizations of the Commissioner for use in
final form. No order suspending the Offerings or authorization for
final use of the Prospectus shall have been issued or proceedings
therefor initiated or threatened by the Commissioner and no order
suspending the sale of the Common Stock in any jurisdiction shall have
been issued.
b. The Registration Statement shall have been declared effective by the
Commission. No stop order suspending the effectiveness of the
Registration Statement shall have been issued under the Securities Act
or proceedings therefor initiated or threatened by the Commission.
c. At the Closing Date, the Company and the Bank will have completed in
all material respects the conditions precedent to the Conversion in
accordance with the Plan, the applicable Conversion Regulations and
all other applicable laws, regulations, decisions and orders,
including all terms, conditions, requirements and provisions precedent
to the Conversion imposed upon the Company or the Bank by the
Commissioner, the FDIC, the OTS or any other regulatory authority
other than those that the Commissioner, the FDIC or the OTS permit to
be completed after the Conversion.
d. The Plan shall have been reviewed without objection by the FDIC. The
OTS shall have approved the Holding Company Application. Any filings
required by the
Trident Securities, Inc.
Sales Agency Agreement
Page 23
Conversion Regulations or by the Home Owners Loan Act (and the
regulations promulgated thereunder) shall have been timely made. Any
request of the Commissioner, the FDIC, the Commission or the OTS for
additional information (to be included in the Conversion Application,
the Prospectus, the Notice, the Registration Statement or the Holding
Company Application or otherwise) shall have been complied with. The
NASD, upon review of the terms of this Agreement, shall not have
objected to Trident's performance of its obligations hereunder or the
terms herein set forth.
e. At the Closing Date, the Common Stock shall have been approved for
quotation on the National Daily Quotation Service "Pink Sheet" upon
notice of issuance.
f. Nothing shall have come to the attention of Trident that would cause
Trident to reasonably believe that the Conversion Application, the
Holding Company Application, the Prospectus or the Registration
Statement or any amendment or supplement thereto, contains an untrue
statement of fact that in the opinion of Vorys, Xxxxx, Xxxxxxx and
Xxxxx LLP, counsel for Trident, is material, or omits to state a fact
that in the opinion of such counsel is material and is required to be
stated therein or is necessary to make the statements therein not
misleading.
g. Except as contemplated in the Prospectus, subsequent to the respective
dates as of which information is given in the Prospectus, there shall
not have occurred any of the events specified in Section 9 hereof
which, in the reasonable judgment of Trident, makes it impractical or
inadvisable to proceed with the offering of the Shares.
h. Trident shall have received a certificate, dated the Closing Date,
signed by the chief executive officer and the chief financial officer
of each of the Company and the Bank, in form and substance
satisfactory to counsel for Trident, to the effect that at the
effective date thereof and at all times subsequent thereto through and
including the Closing Date, the Registration Statement did not contain
any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary in order to make the
statements therein not misleading and that at the date thereof and at
all times subsequent thereto through and including the Closing Date,
the Prospectus did not contain any untrue statement of a material fact
or omit to state any 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; that since
the effective date of the Registration Statement, no event has
occurred that should have been set forth in
Trident Securities, Inc.
Sales Agency Agreement
Page 24
an amendment or supplement to the Conversion Application, the
Prospectus, the Notice, the Registration Statement or the Holding
Company Application under applicable law that has not been so set
forth, and to the best of their knowledge, that no order has been
issued by the Commissioner, the FDIC, the Commission or the OTS to
suspend the offering of the Common Stock or the approval of the
Conversion Application or the Holding Company Application and, to the
best of their knowledge, no action for such purposes has been
instituted or threatened by the Commissioner, the FDIC, the Commission
or the OTS; that, to the best of their knowledge, no person has sought
to obtain review of the final actions of the Commissioner, the FDIC,
the Commission or the OTS in connection with the Conversion; and that
all of its representations and warranties contained herein are true
and correct as if made at and as of the Closing Date.
i. Trident shall have received the opinion of Xxxxxxx, Xxxxxx & Xxxxxxxx,
special counsel for the Company and the Bank, which opinion shall
address those matters set forth below in subsections (i) through
(xvii), inclusive. Such opinion shall be dated the Closing Date, in
form and substance satisfactory to counsel for Trident, to the
following effect:
i. The Company has been duly incorporated and is validly existing as
a corporation in good standing under the laws of the State of
Delaware. The Company has full corporate power and authority to
own, lease and operate its properties and to conduct its business
as described in the Registration Statement and Prospectus and to
enter into and perform its obligations under this Agreement. The
Company is duly qualified as a foreign corporation to transact
business and is in good standing in The Commonwealth of
Massachusetts and in all other jurisdictions in which the failure
to so qualify would have a material adverse effect upon the
financial condition, results of operations or business of the
Company, the Bank and the Bank Subsidiaries, taken as a whole.
ii. The Bank has been at all times since the date hereof and prior to
the Closing Time duly organized, and is validly existing, under
the laws of The Commonwealth of Massachusetts as a co-operative
bank of mutual form, and, at the Closing Time, has become duly
organized, validly existing and in good standing under the laws
of The Commonwealth of Massachusetts as a co-operative bank of
stock form, in both instances with full corporate power and
authority to own, lease and operate its properties and to conduct
its business as described in the Registration Statement and
Trident Securities, Inc.
Sales Agency Agreement
Page 25
the Prospectus and to enter into and perform its obligations
under this Agreement. The Bank is duly qualified as a foreign
corporation in each jurisdiction in which the failure to so
qualify would have a material adverse effect upon the financial
condition, results of operations or business of the Company, the
Bank and the Bank Subsidiaries, taken as a whole. The Bank is a
member in good standing of the FHLB of Boston and the Central
Bank. The deposit accounts of the Bank are insured by the FDIC in
the BIF up to the applicable limits, and deposits not insured by
the FDIC are insured by the Share Insurance Fund of the Central
Bank. The liquidation account for the benefit of account holders
as of April 30, 1997 and ___________ has been duly established in
accordance with the requirements of the Conversion Regulations,
and such account holders who continue to maintain their deposit
accounts in the Bank have a contingent creditors' interest in
their pro rata portion of the liquidation account which will have
a priority superior to that of the holders of shares of Common
Stock in the event of a complete liquidation of the Bank.
iii. The Company does not directly own any subsidiaries other than the
Bank, and the Bank's only subsidiaries are the Bank Subsidiaries.
The Bank Subsidiaries have been duly incorporated and are validly
existing as corporations in good standing under the laws of The
Commonwealth of Massachusetts, have full corporate power and
authority to own, lease and operate their properties and to
conduct their business as described in the Prospectus and are
duly qualified as foreign corporations to transact business and
are in good standing in each jurisdiction in which the failure to
so qualify would have a material adverse effect upon the
financial condition, results of operations or business of the
Company, the Bank and the Bank Subsidiaries, taken as a whole.
The activities of the Bank Subsidiaries as described in the
Prospectus are permitted to subsidiaries of a savings and loan
holding company and of a Massachusetts-chartered co-operative
bank by the rules, regulations, resolutions and practices of the
OTS and the Commissioner. All of the issued and outstanding
capital stock of each of the Bank Subsidiaries has been duly
authorized and validly issued, is fully paid and non-assessable
and is owned of record by the Bank free and clear of any security
interest, mortgage, pledge, lien, encumbrance or claim.
iv. The execution and delivery of this Agreement and the consummation
of the transactions contemplated hereby,
Trident Securities, Inc.
Sales Agency Agreement
Page 26
(1) have been duly and validly authorized by all necessary
action on the part of each of the Company and the Bank, and
this Agreement constitutes the legal, valid and binding
agreement of each of the Company and the Bank, enforceable
in accordance with its terms, except as rights to indemnity
and contribution hereunder may be limited under applicable
law (it being understood that such counsel may avail itself
of customary exceptions concerning the effect of bankruptcy,
insolvency or similar laws and the availability of equitable
remedies),
(2) to the best of such counsel's knowledge, will not conflict
with or constitute a breach of or default under, and no
event has occurred 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 any property or assets of the Company, the Bank or the
Bank Subsidiaries pursuant to any contract, indenture,
mortgage, loan agreement, note, lease or other instrument to
which the Company, the Bank or the Bank Subsidiaries are a
party or by which any of them may be bound, or to which any
of the property or assets of the Company, the Bank or the
Bank Subsidiaries is subject, other than conflicts,
breaches, defaults, liens, charges or encumbrances that,
individually or in the aggregate, would not have a material
adverse effect on the financial condition, results of
operations or business of the Company, the Bank and the Bank
Subsidiaries, taken as a whole,
(3) will not result in any violation of the provisions of the
Certificate of Incorporation, charter or bylaws of the
Company, the Bank or the Bank Subsidiaries, and
(4) will not result in any violation of any law or
administrative regulation or any administrative or court
decree that, individually or in the aggregate, would have a
material adverse effect on the financial condition, results
of operations or business of the Company, the Bank and the
Bank Subsidiaries, taken as a whole.
v. Upon consummation of the Conversion, the authorized, issued and
outstanding capital stock of the Company will be within the range
as set
Trident Securities, Inc.
Sales Agency Agreement
Page 27
forth in the Prospectus under "CAPITALIZATION," and no shares of
Common Stock have been issued and outstanding prior to the
Closing Time except for shares issued to the Bank to be canceled
at the Closing. The Shares and the Foundation Shares have been
duly and validly authorized for issuance and sale and, when the
Shares are issued and delivered by the Company pursuant to the
Plan against payment of the consideration therefor, the Shares
will be duly and validly issued and fully paid and non-
assessable. The issuance of the Shares is not subject to
preemptive or other similar rights. The terms and conditions of
the Common Stock conform to the description thereof contained in
the Prospectus under the caption "DESCRIPTION OF CAPITAL STOCK OF
THE COMPANY," and, to the extent that it constitutes matters of
law or legal conclusions, that section of the Prospectus has been
reviewed by such counsel and is correct in all material respects.
The certificates representing shares of Common Stock are in
compliance in all material respects with all applicable legal
requirements.
vi. Upon consummation of the Conversion, all of the issued and
outstanding capital stock of the Bank will be duly authorized and
validly issued and fully paid and non-assessable, and all such
capital stock will be owned of record by the Company free and
clear of any security interest, mortgage, pledge, lien,
encumbrance or legal or equitable claim.
vii. The Commissioner has approved the Conversion Application and the
OTS has approved the Holding Company Application and no action is
pending or, to the best of such counsel's knowledge, threatened
regarding the Conversion Application or the Holding Company
Application or the acquisition by the Company of all of the
Bank's issued and outstanding capital stock. The Conversion
Application and the Holding Company Application comply as to form
in all material respects with the Conversion Regulations, the
regulations of the OTS and all other applicable requirements of
the Commissioner, the FDIC and the OTS (other than the financial
statements, appraisal and statistical data included therein, as
to which no opinion need be rendered), and, to the best of such
counsel's knowledge, include all documents required to be filed
as exhibits thereto, and is complete in all material respects.
The Company is duly authorized to become a savings and loan
holding company and is duly authorized to own all of the issued
and outstanding capital stock of the Bank to be issued pursuant
to the Plan.
Trident Securities, Inc.
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Page 28
viii. The FDIC has reviewed the Plan without objection and no action is
pending or, to the best of such counsel's knowledge, threatened
respecting the FDIC's review thereof, the notice of the
Conversion filed with the FDIC complied as to form in all
material respects with the FDIC's regulations and all other
applicable requirements of the FDIC, and, to the best of such
counsel's knowledge, included all documents required to be filed
as exhibits thereto, and is complete in all material respects.
ix. The Plan has been duly authorized by the Boards of Directors of
the Company and the Bank and by the mutual shareholders of the
Bank. The Commissioner's approval of the Plan (and the FDIC's
non-objection thereto) remains in full force and effect. The
Bank's charter has been amended, effective upon consummation of
the Conversion and the filing of such amended charter with the
Secretary of State of The Commonwealth of Massachusetts, to
authorize the issuance of permanent capital stock. To the best of
such counsel's knowledge, the Company and the Bank have conducted
the Conversion in all material respects in accordance with
applicable requirements of the Plan, the Conversion Regulations
and all other applicable regulations, decisions and orders
thereunder, including all material applicable terms, conditions,
requirements and conditions precedent to the Conversion imposed
upon the Company or the Bank by the Commissioner or the FDIC. No
order, to the best of such counsel's knowledge, has been issued
by the Commissioner or the FDIC to suspend the Offerings and, no
action for such purpose has been instituted or, to the best of
such counsel's knowledge threatened by the Commissioner or the
FDIC and, to the best of such counsel's knowledge, no person has
sought to obtain review of the final action of the Commissioner
in approving, or of the FDIC in issuing a notice of non-objection
to, the Plan.
x. The Prospectus and the Notice have been duly authorized by the
Commissioner for final use pursuant to the Conversion Regulations
and no action has been taken, or is pending or, to the best of
such counsel's knowledge, threatened, by the Commissioner to
revoke such authorization. The Prospectus and the Notice (other
than the financial statements, appraisal and statistical data
included therein, as to which no opinion need be rendered)
complied as to form in all material respects with the
requirements of the Conversion Regulations.
Trident Securities, Inc.
Sales Agency Agreement
Page 29
xi. The Registration Statement is effective under the Securities Act
and no stop order suspending the effectiveness of the
Registration Statement has been issued under the Securities Act
or proceedings therefor initiated or, to the best of such
counsel's knowledge, threatened by the Commission. At the time
the Registration Statement became effective, the Registration
Statement (other than the financial statements, appraisal and
statistical data included therein, as to which no opinion need be
rendered) and the Prospectus complied as to form in all material
respects with the requirements of the Securities Act and the
Securities Act Regulations.
xii. No further approval, authorization, consent or other order of any
public board or body is required in connection with the execution
and delivery of this Agreement, the issuance of the Shares, the
contribution of Foundation Shares to the Foundation and the
consummation of the Conversion, except as may be required under
the securities or "blue sky" laws of various jurisdictions as to
which no opinion need be rendered.
xiii. The information in the Prospectus under the caption "THE
CONVERSION," to the extent that it constitutes matters of law or
legal conclusions, has been reviewed by such counsel and is
correct in all material respects. The information in the
Prospectus under the caption "FEDERAL AND STATE TAXATION," to the
extent that it constitutes matters of law or legal conclusions
concerning federal tax matters, has been reviewed by such counsel
and is correct in all material respects. The information under
the caption "The Conversion -- Tax Aspects" correctly summarizes
the opinion of such counsel regarding the federal tax effects of
the Conversion to the Bank and the mutual shareholders of the
Bank
xiv. To the best of such counsel's knowledge, there are no legal or
governmental proceedings pending or threatened against or
affecting the Company, the Bank or the Bank Subsidiaries that are
required, individually or in the aggregate, to be disclosed in
the Registration Statement and the Prospectus, other than those
disclosed therein, and all pending legal or governmental
proceedings to which the Company, the Bank or the Bank
Subsidiaries are a party or to which any of their property is
subject which are not described in the Registration Statement,
including ordinary routine litigation incidental to the business,
are, considered in the aggregate, not material.
Trident Securities, Inc.
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xv. To the best of such counsel's knowledge and information, there
are no contracts, indentures, mortgages, loan agreements, notes,
leases or other instruments required to be described or referred
to in the Registration Statement or to be filed as exhibits
thereto other than those described or referred to therein or
filed as exhibits thereto.
xvi. To the best of such counsel's knowledge and information, the
Company, the Bank and the Bank Subsidiaries have obtained all
licenses, permits and other governmental approvals and
authorizations currently required for the conduct of their
respective businesses as described in the Registration Statement
and Prospectus, except for such licenses, permits, approvals or
authorizations the failure of which to have would not result in a
material adverse change in the financial condition, results of
operations or the business of the Company, the Bank and the Bank
Subsidiaries, taken as a whole. All such licenses, permits and
other governmental authorizations are in full force and effect,
and each of the Company, the Bank and the Bank Subsidiaries is in
all material respects complying therewith.
xvii. Upon completion of the Conversion, the Foundation will be duly
incorporated and validly existing as a non-stock corporation in
good standing under the laws of the State of Delaware. All
approvals required to contribute the Foundation Shares to the
Foundation have been received, except as specifically disclosed
in the Prospectus. The Foundation Shares will have been duly
authorized for issuance and pursuant to the Plan, will be duly
and validly issued and fully-paid and non-assessable.
xviii. Neither the Company, the Bank nor the Bank Subsidiaries is in
violation of its charter or certificate of incorporation upon
consummation of the Conversion nor, to the best of such counsel's
knowledge, in default (nor has any event occurred which, with
notice or lapse of time or both, would constitute a default) in
the performance or observance of any obligation, agreement,
covenant or condition contained in any contract, indenture,
mortgage, loan agreement, note, lease or other instrument to
which the Company, the Bank or the Bank Subsidiaries is a party
or by which the Company, the Bank or the Bank Subsidiaries or any
of their respective property may be bound in any respect that
would have a material adverse effect upon the financial
condition, results of operations or business of the Company, the
Bank and the Bank Subsidiaries, taken as a whole.
Trident Securities, Inc.
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Page 31
xix. The Foundation has been effected in all material respects in
accordance with the requirements of the FDIC and the State of
Delaware. All terms, conditions, requirements and provisions
regarding the organization and purpose of the Foundation imposed
by the FDIC, except with respect to the filing and submission of
any required reports after the Foundation is formed and the
Conversion completed, have been completed. To the best of such
counsel's knowledge, no person has sought to obtain regulatory or
judicial review of the final action of the FDIC or the
Commissioner in approving or issuing a non-objection letter
regarding the formation of the Foundation and the contribution of
the Foundation Shares.
In rendering such opinion, such counsel may rely as to matters of fact on
certificates of responsible officers of the Company and the Bank and
certificates of public officials, and as to matters of law other than federal
law, on opinions of other counsel admitted to practice the applicable law
reasonably acceptable to counsel for Trident; provided, however, that such
counsel shall provide a letter addressed to Trident which states that with
respect to the opinion of such other counsel, nothing has come to such counsel's
attention that would lead it to believe that it and Trident are not reasonably
justified in relying upon such opinion. In addition, such other counsel shall
address its opinion letter to Trident or expressly state in its opinion letter
or in a separate letter addressed to Trident that Trident and Trident's counsel
are entitled to rely upon such opinion. Such counsel may assume that any
agreement is the valid and binding obligation of any party to such agreement
other than the Company or the Bank. Copies of any certificates of officers of
the Company or the Bank on which counsel relies shall be furnished to counsel
for Trident at the time the opinion is delivered.
Such counsel's opinion may be limited to present statutes, regulations and
judicial interpretations and to facts as they exist as of the date of the
opinions. In rendering such opinion, counsel need assume no obligation to
revise or supplement it should present laws be changed by legislative or
regulatory action, judicial decision or otherwise. Such counsel need express no
view, opinion or belief with respect to whether any proposed or pending
legislation, if enacted, or any regulations or any policy statements issued by
any regulatory agency, whether or not promulgated pursuant to any such
legislation, would affect the validity of the execution and delivery by the
Company or the Bank of this Agreement or the issuance of the Shares.
(j) At the Closing Date, Trident shall receive the letter of Xxxxxxx,
Xxxxxx & Xxxxxxxx, special counsel for the Company and the Bank, dated
the Closing Date, addressed to Trident, in form and substance
reasonably satisfactory to counsel for Trident and to the effect that:
in connection with the preparation of the
Trident Securities, Inc.
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Conversion Application (including the Prospectus and the Notice) and
the Registration Statement, such counsel participated in conferences
with directors, officers, employees and other representatives of the
Bank and representatives of the independent public accountants for the
Bank as well as reviewed various documents and other information
deemed relevant and, based on such conferences and review, nothing has
come to such counsel's attention that would lead such counsel to
believe (i) that the Registration Statement, at the time it became
effective (including any post-effective amendments), or that the
Conversion Application, at the time it was approved, 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 not misleading (except as to information with respect to
Trident, as to the appraisal and as to financial statements, notes to
financial statements, financial tables and other financial and
statistical data contained therein with respect to which such counsel
need express no comment), or (ii) that the Prospectus or the Notice,
at the date thereof or at Closing Time, included 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 light
of the circumstances under which they were made, not misleading
(except as to information with respect to Trident, as to the appraisal
and as to financial statements, notes to financial statements,
financial tables and other financial and statistical data contained
therein with respect to which such counsel need express no comment).
In rendering this letter, counsel may state that they have not
undertaken to verify independently the information in the Conversion
Application, the Prospectus and the Notice or the Registration
Statement and therefore, do not assume any responsibility for the
accuracy or completeness thereof
(k) Counsel for Trident 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 Trident, and for the
purposes 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 and the Bank regarding the
authorization of this Agreement and the transactions contemplated
hereby.
(l) Prior to and at the Closing Date, in the reasonable opinion of
Trident, (i) there shall have been no material adverse change in the
condition, financial or otherwise, of the Bank since the last date as
of which such condition is set forth in
Trident Securities, Inc.
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the Prospectus, except as referred to therein; (ii) there shall have
been no transaction entered into by the Bank after the latest date as
of which the financial condition of the Bank is set forth in the
Prospectus other than transactions referred to or contemplated
therein, transactions in the ordinary course of business, and
transactions which are not material to the Bank; (iii) the Bank shall
not have received from the Commissioner, the FDIC, or any other
governmental authority any direction (oral or written) to make any
material change in the method of conducting their respective
businesses with which it has not complied or which is material to the
business of the Bank; (iv) no action, suit or proceeding, at law or in
equity or before or by any federal or state commission, board or other
administrative agency, shall be pending or threatened against the
Company, the Bank or the Bank Subsidiaries or affecting any of their
respective assets, wherein an unfavorable decision, ruling or finding
materially and adversely would affect the business, operations,
financial condition or income of the Company, the Bank and the Bank
Subsidiaries, taken as a whole; and (v) the Shares shall have been
qualified or registered for offering and sale by the Company or are
exempt from such qualification or registration under the securities or
"blue sky" laws of such jurisdictions as Trident and the Company shall
have agreed upon.
(m) At the Closing Date, Trident shall receive, among other documents, (i)
a copy of the letter of the Commissioner approving the Conversion
Application and authorizing the use of the Prospectus, (ii) a copy of
the letter from The Commonwealth of Massachusetts or the Commissioner
evidencing the good standing of the Bank, (iii) a copy of the letter
from the FDIC raising no objection to the Plan and the Conversion;
(iv) a copy of the letter from The Commonwealth of Massachusetts or
the Commissioner approving the Bank's Stock Charter; (v) a copy of the
letter from the OTS approving the Holding Company Application; and
(vi) a copy of a statement from the Commission declaring the
Registration Statement effective.
(n) Trident shall have received such opinion of Vorys, Xxxxx, Xxxxxxx and
Xxxxx, LLP, counsel for Trident, dated the Closing Date, with respect
to certain matters as Trident may reasonably request, and such counsel
shall have received such documents, papers and records as they request
for the purpose of enabling them to pass upon such matters.
(o) Concurrently with the execution of this Agreement, Trident shall
receive a letter from Wolf, dated the date hereof and addressed to
Trident: (i) confirming that Wolf is a firm of independent public
accountants within the meaning of the
Trident Securities, Inc.
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Page 34
Securities Act and the FDIC's securities disclosure regulations and 12
C.F.R. (S) 335.604(a) and no information concerning its relationship
with or interests in the Bank is required by the Conversion
Application, and stating in effect that in Wolf's opinion the
financial statements of the Bank as are included in the Prospectus
comply as to form in all material respects with the applicable
accounting requirements of the Conversion Regulations, the Securities
Act, the Securities Act Regulations and GAAP; (ii) stating in effect
that, on the basis of certain agreed upon procedures (but not an audit
examination in accordance with GAAP) consisting of a reading of the
latest available unaudited interim financial statements of the Bank
prepared by the Bank, a reading of the minutes of the meetings of the
Board of Directors and shareholders of the Bank and consultations with
officers of the Bank responsible for financial and accounting matters,
nothing came to their attention which caused them to believe that: (A)
such unaudited financial statements, including Recent Developments,
are not in conformity with GAAP applied on a basis substantially
consistent with that of the audited financial statements included in
the Prospectus; or (B) during the period from the date of the latest
unaudited financial statements included in the Prospectus to a
specified date not more than three business days prior to the date
hereof, there was any material increase in borrowings, and any other
form of debt other than deposits of the Bank (increases in borrowings
will not be deemed to be material if such increase in total borrowings
outstanding does not exceed $1,000,000); (C) there was any decrease in
changes in surplus of the Bank at the date of such letter as compared
with amounts shown in the latest unaudited statement of condition
included in the Prospectus, including Recent Developments; or (D)
there was any decrease in net income or net interest income of the
Bank for the number of full months commencing immediately after the
period covered by the latest unaudited income statement included in
the Prospectus, including Recent Developments, and ended on the latest
month end prior to the date of the Prospectus or such letter as
compared to the corresponding period in the preceding year; and (iii)
stating that, in addition to the audit examination referred to in its
opinion included in the Prospectus and the performance of the
procedures referred to in clause (ii) of this subsection (o), they
have compared with the general accounting records of the Bank, which
are subject to the internal controls of the Bank, accounting system
and other data prepared by the Bank, directly from such accounting
records, to the extent specified in such letter, such amounts and/or
percentages set forth in the Prospectus as Trident may reasonably
request; and they have found such amounts and percentages to be in
agreement therewith (subject to rounding).
(p) At the Closing Date, Trident shall receive a letter from Wolf, dated
the Closing
Trident Securities, Inc.
Sales Agency Agreement
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Date, addressed to Trident, confirming the statements made by its
letter delivered by it pursuant to subsection (o) of this Section 6,
the "specified date" referred to in clause (ii)(B) thereof to be a
date specified in such letter, which shall not be more than three
business days prior to the Closing Date.
(q) Trident shall have received a confirming letter from the Appraiser,
dated the Closing Date, with respect to its estimated pro forma fair
market value appraisal. Such letter shall be of the type described in
the Prospectus to be submitted promptly after completion of the
offering of the Shares.
(r) All necessary approvals and consents to the consummation of the
Conversion shall have been obtained, and the Shares shall have been
qualified or be exempt from qualification under the state securities
laws of the states as shall have been agreed upon by Trident and the
Company.
(s) The representations and warranties of each of the Company and the Bank
contained herein shall be true and correct on the date of this
Agreement and on and as of the Closing Date, and each of the Company
and the Bank shall have performed all covenants and agreements
contained herein, to be performed on their part at or prior to the
Closing Date.
(t) At any time prior to the Closing Date, (i) there shall not have
occurred any material adverse change in the financial markets in the
United States or elsewhere or any outbreak of hostilities or
escalation thereof or other calamity or crisis the effects of which,
in the judgment of Trident, are so material and adverse as to make it
impracticable to market the Common Stock or to enforce contracts,
including subscriptions or orders, for the sale of the Common Stock,
and (ii) trading generally on either the Nasdaq National Market or the
New York Stock Exchange shall not have been suspended, or minimum or
maximum prices for trading shall not have been fixed, or maximum
ranges for prices for securities shall not have been required, by
either of such Exchange or Market or by order of the Commission or any
other governmental authority, and a banking moratorium shall not have
been declared by either federal or Massachusetts authorities.
All such opinions, certificates, letters and documents shall be in
compliance with the provisions hereof only if they are, in the reasonable
opinion of Trident and its counsel, satisfactory to Trident and its counsel. Any
certificates signed by an officer or director of the Company or the Bank
prepared for Trident's reliance and delivered to Trident or to counsel for
Trident pursuant to this Agreement shall be deemed a representation and warranty
by the Company or the Bank, as the
Trident Securities, Inc.
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case may be, to Trident as to the statements made therein. If any condition to
Trident's obligations hereunder to be fulfilled prior to or at the Closing Date
is not so fulfilled, Trident may terminate this Agreement or, if Trident so
elects, may waive in writing such conditions which have not been fulfilled, or
may extend the time of their fulfillment. If Trident terminates this Agreement
as aforesaid, the Company or the Bank shall reimburse Trident for its
accountable expenses as provided in Section 3 hereof.
7. Indemnification and Contribution.
--
(a) Each of the Company and the Bank hereby agrees to indemnify and hold
harmless Trident and each person, if any, who controls Trident within
the meaning of Section 15 or Section 20(a) of the Exchange Act,
against any losses, damages or liabilities, joint or several, to which
Trident or each such controlling person may become subject, under the
Securities Act, the Exchange Act or other federal or state statutory
law or regulation, at common law or otherwise, insofar as such losses,
claims, damages, or liabilities (or actions in respect thereof) arise
out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in the Prospectus or the
Registration Statement or any amendment or supplement thereto, or in
any application filed under any state securities law, or in any other
document executed by the Company or the Bank in connection with, or in
contemplation of the transactions contemplated by this Agreement or
arise out of or are based upon the omission or alleged omission to
state therein a material fact required to be stated therein or
necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading. Each of the
Company and the Bank agrees to reimburse Trident and each such
controlling person in connection with investigating, preparing or
defending against any such loss, claim, damage, liability or action;
provided, however, that neither the Company nor the Bank will be
liable in any such case to the extent that any such loss, claim,
damage, liability or expense arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission
made in the Prospectus or the Registration Statement or any amendment
or supplement thereto, or in any state securities law application, or
in any other document executed by the Company or the Bank in
connection with or in contemplation of the transactions contemplated
by this Agreement in reliance upon and in conformity with written
information furnished to the Company or the Bank by or on behalf of
Trident specifically for use therein. In the event the Company or the
Bank advances any amounts alleged to be due under this Section 7(a) to
the indemnified party, and it is determined by a court of competent
jurisdiction that the indemnified party is not entitled to
indemnification hereunder,
Trident Securities, Inc.
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then the indemnified party shall repay, without interest, any amounts
so advanced to the Company or the Bank. The indemnification
obligations of the Company and the Bank as provided above are in
addition to any liabilities the Company or the Bank may have under
other agreements, under common law or otherwise.
(b) Trident agrees to indemnify and hold harmless the Company and the
Bank, their directors, officers and employees, and each person, if
any, who controls the Company or the Bank within the meaning of the
Securities Act, against any losses, claims, damages or liability to
which the Company or the Bank, or any such director, officer, or
controlling person may be subject, under the Securities Act, the
Exchange Act, or other federal or state statutory law or regulation,
at common law or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based
upon any untrue or alleged untrue statement of any material fact
contained in the Prospectus or the Registration Statement or any
amendment or supplement thereto, or in any other document executed by
the Company or the Bank in connection with or in contemplation of the
transactions contemplated by this Agreement or in any state
securities law application, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not
misleading, in each case to the extent, but only to the extent, that
such untrue statement or alleged untrue statement or omission or
alleged omission was made in the Prospectus or the Registration
Statement, or any amendment or supplement thereto, in any state
securities law application, or in any other document executed by the
Company or the Bank in connection with or in contemplation of the
transactions contemplated by this Agreement in reliance upon and in
conformity with any written information furnished to the Company or
the Bank by Trident specifically for use in the preparation thereof.
Trident will reimburse any legal or other expenses reasonably incurred
by the Company or the Bank or any such director, officer, or
controlling person in connection with investigating, preparing or
defending against any such loss, claim, damage, liability or action.
In the event Trident advances any amounts alleged to be due under this
Section 7(b) to an indemnified party and it is determined by a court
of competent jurisdiction that the indemnified party is not entitled
to indemnification hereunder, then the indemnified party shall repay,
without interest, any amounts so advanced to Trident. The
indemnification obligations of Trident as provided above are in
addition to any liabilities Trident may have under other agreements,
under common law or otherwise.
Trident Securities, Inc.
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(c) Promptly after receipt by an indemnified party under this Section 7 of
notice of the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against an
indemnifying party under this Section 7, notify the indemnifying party
in writing of the commencement thereof; provided, however, that the
omission to so notify the indemnifying party will not relieve an
indemnifying party from any liability which it or he may have to any
indemnified party otherwise than under this Section 7, except to the
extent, and only to the extent, that the indemnifying party
establishes that such failure to so notify prejudiced it or his rights
in the defense against such claim. In case any such action is brought
against any indemnified party, and such indemnified party notifies an
indemnifying party of the commencement thereof, the indemnifying party
will be entitled to participate in, and, to the extent that it or he
may wish, jointly with all other indemnifying parties, similarly
notified, to assume the defense thereof, with counsel reasonably
satisfactory to such indemnified party; provided, however, 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 advice of its counsel, that there may be legal
defenses available to it or him and/or other indemnified parties which
are different from or additional to those available to the
indemnifying party, the indemnified party or parties shall have the
right to select separate counsel to assume such legal defenses and to
otherwise participate in the defense of such action on behalf of such
indemnified party or parties. 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 7 for any legal or other expenses
subsequently incurred by such indemnified party in connection with the
defense thereof unless:
i. the indemnified party shall have employed such counsel in
connection with the assumption of legal defenses in accordance
with the proviso 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);
ii. 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 or
commencement of the action; or
iii. the indemnifying party has authorized the employment of counsel
at the
Trident Securities, Inc.
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expense of the indemnifying party.
d. If the indemnification provided for in this Section 7 is unavailable
to an indemnified party in respect of any losses, claims, damages or
liabilities referred to therein, then each indemnifying party, in lieu
of indemnifying such indemnified party, shall, subject to the
limitations hereinafter set forth, contribute to the amount paid or
payable by such indemnified party as a result of such losses, claims,
damages or liabilities:
i. in such proportion as is appropriate to reflect the relative
benefits received by the Company and the Bank and Trident from
the Offerings; or
ii. if the allocation provided by clause (i) above is not permitted
by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Company and the Bank and
Trident in connection with the statements or omissions which
resulted in such losses, claims, damages or liabilities, as well
as any other relevant equitable considerations.
The respective relative benefits received by the Company and the Bank and
Trident shall be deemed to be represented by the percentage that the fees to be
paid to Trident hereunder bears to the total gross proceeds of the Conversion.
The relative fault of the Company and the Bank and Trident shall be determined
by reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission to state a material fact relates to
information supplied by the Company and the Bank, or by Trident, and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. The amount paid or payable by a
party as a result of the losses, claims, damages and liabilities referred to
above shall be deemed to include, subject to the limitations set forth in
paragraph (d) of this Section 7, any legal or other fees or expenses reasonably
incurred by such party in connection with investigating or defending any action
or claim.
The Company and the Bank and Trident agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by pro rata
or per capita allocation or by any other method or allocation which does not
take into account the equitable considerations referred to in the immediately
preceding paragraph. Notwithstanding the provisions of this Section 7, no
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
Trident Securities, Inc.
Sales Agency Agreement
Page 40
8. Survival of Certain Representations and Obligations. All representations,
--
warranties and agreements of the Company and the Bank herein and of
Trident, if any, or certificates delivered pursuant hereto, and the
agreement of the parties contained in Section 7 hereof, will remain in full
force and effect and will survive the issuance of and payment for the
Shares and/or any termination or consummation of this Agreement, and any
legal representative of Trident, the Company and the Bank and any such
controlling persons shall be entitled to the benefit of the respective
agreements, indemnities, warranties and representations.
9. Termination. Trident shall have the right by giving notice as hereinafter
--
specified at any time at or prior to the Closing Date, to terminate this
Agreement if any of the following events shall occur:
a. there shall have occurred (i) any general suspension of, or limitation
on prices for, trading in securities on the New York Stock Exchange or
in the over-the-counter market, (ii) a declaration of a banking
moratorium or any suspension of payments in respect of banks or
savings associations in the United States, (iii) a commencement of a
war, armed hostilities or other substantial international or national
calamity directly or indirectly involving the United States, (iv) any
limitation (whether or not mandatory) by any governmental authority
on, or any other event which might materially affect, the extension of
credit by banks or other lending institutions, or (v) a material
change in United States or any other currency exchange rates or a
suspension of, or limitation on, the markets therefor;
b. there shall be threatened, instituted or pending any action, suit,
proceeding or other application before or by any court, regulatory
authority or governmental agency or body or by any other person that,
in the reasonable judgment of Trident might materially and adversely
affect the financial condition, business, or results of operations of
the Company or the Bank or the value of the Shares;
c. the Company or the Bank shall have sustained a material loss by fire,
flood, accident or other calamity which is material to the property,
financial condition, business, or results of operations of the Company
or the Bank, whether or not such loss shall have been insured; or
d. there otherwise shall have been, since the respective dates as of
which information is given in the Prospectus, any material adverse
change in the financial condition, business, or results of operations
of the Bank, whether or not arising in the ordinary course of
business, that in the reasonable judgment of Trident makes it
Trident Securities, Inc.
Sales Agency Agreement
Page 41
impractical or inadvisable to proceed with the offering of the Shares.
A termination pursuant to this Section 9 shall be without liability on the
part of Trident to the Company or the Bank or on the part of the Company or the
Bank to Trident (except that the Company and the Bank shall remain responsible
for the expenses to be paid or reimbursed by them pursuant to Sections 3(d) (ii)
and (iii) and the respective obligations of the parties pursuant to Section 7
hereof shall remain in full force and effect).
10. Notices. All notices or communications hereunder shall be in writing and
---
if sent to Trident shall be mailed, delivered, telecopied or telegraphed
and confirmed to Trident at its address set forth on the first page hereof
to the attention of Xxxxxxx X. Xxxxxxx (with a copy to Vorys, Xxxxx,
Xxxxxxx and Xxxxx LLP, 000 Xxxx Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxx 00000,
Attention: Xxxxx Xxxxxxxx Xxxxx); or if sent to the Company or the Bank
shall be mailed, delivered, telecopied or telegraphed and confirmed to the
Company or the Bank at 0000 Xxxxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000,
Attention: Xxxx X. Xxxxx (with a copy to Xxxxxxx, Xxxxxx & Xxxxxxxx, 0000
Xxxxxxxxx Xxxxxx, X.X., Xxxxxxxxxx, X.X. 00000, Attention: Xxxxxxxx X.X.
Spacassi).
11. Parties. This Agreement shall inure to the benefit of, and shall be
---
binding upon, Trident, the Company and the Bank, and the controlling
persons, officers and directors referred to in Section 7 hereof, and their
respective successors, legal representatives and assigns, and no other
person shall have any legal or equitable right, remedy or claim under or by
virtue of this Agreement.
12. Applicable Law. This Agreement shall be governed by, and construed in
---
accordance with, the laws of The Commonwealth of Massachusetts, except to
the extent that federal law applies.
13. Counterparts. This Agreement may be executed in separate counterparts,
---
each of which when so executed and delivered shall be an original, but all
of which together shall constitute but one and the same instrument.
If the foregoing is in accordance with your understanding of our agreement,
kindly sign and return to us the enclosed duplicates hereof, whereupon it will
become a binding agreement between the Company and the Bank and Trident in
accordance with its terms.
MASSACHUSETTS FINCORP, INC.
Trident Securities, Inc.
Sales Agency Agreement
Page 42
By:
Xxxx X. Xxxxx
President, Chief Executive Officer and
Chairman of the Board
THE MASSACHUSETTS CO-OPERATIVE BANK
By:
Xxxx X. Xxxxx
President and Chief Executive Officer
The foregoing Sales Agency
Agreement is hereby confirmed
and accepted as of the date
first above written.
TRIDENT SECURITIES, INC.
By:
Xxxxxxx X. Xxxxxxx
President
Trident Securities, Inc.
Sales Agency Agreement
Page 43
Exhibit A
Trident Securities, Inc. is a registered selling agent in the jurisdictions
listed below:
Alabama Missouri
Arizona Nebraska
Arkansas Nevada
California New Hampshire
Colorado New Jersey
Connecticut New Mexico
Delaware New York
District of Columbia North Carolina
Florida North Dakota (Trident Securities, Inc. only, no agents)
Georgia Ohio
Idaho Oklahoma
Illinois Oregon
Indiana Pennsylvania
Iowa Rhode Island
Trident Securities, Inc.
Sales Agency Agreement
Page 44
Kansas South Carolina
Kentucky Tennessee
Louisiana Texas
Maine Vermont
Maryland Virginia
Massachusetts Washington
Michigan West Virginia
Minnesota Wisconsin
Mississippi Wyoming
Trident Securities, Inc. is not a registered selling agent in the jurisdictions
listed below:
Alaska
Hawaii
Montana
South Dakota
Utah
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Tuesday, September 22, 1998
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