Exhibit 10.1
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REGISTRATION RIGHTS AGREEMENT
Dated as of August 28, 2000
Among
SOVEREIGN REAL ESTATE INVESTMENT TRUST
SOVEREIGN BANK
and
XXXXXX BROTHERS INC.
and
XXXXXXX XXXXX BARNEY INC.
as Initial Purchasers
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TABLE OF CONTENTS
PAGE
1. Definitions...............................................1
2. Securities Subject to This Agreement......................5
3. Registered Exchange Offer.................................5
4. Shelf Registration........................................8
5. Liquidated Damages.......................................11
6. Registration Procedures..................................12
7. Registration Expenses....................................23
8. Indemnification and Contribution.........................24
9. Rule 144A................................................28
10. Participation in Underwritten Registrations..............29
11. Selection of Underwriters................................29
12. Miscellaneous............................................29
This Registration Rights Agreement (this "Agreement") is made and
entered into as of August 28, 2000 by and among Sovereign Real Estate
Investment Trust, a statutory business trust created under the Business
Trust Act of the State of Delaware (the "Company"), Sovereign Bank, a
federally chartered savings bank (the "Bank"), Xxxxxx Brothers Inc. and
Xxxxxxx Xxxxx Barney Inc. (together with Xxxxxx Brothers Inc., the
"Initial Purchasers").
This Agreement is entered into in connection with the Purchase
Agreement, dated as of August 21, 2000 (the "Purchase Agreement"), by and
among the Company, the Bank, Sovereign REIT Holdings, Inc. (the "Selling
Holder") and Sovereign Bancorp, Inc. ("SBI") and the Initial Purchasers,
which provides for (i) the sale by the Company and the Selling Holder to
the Initial Purchasers of an aggregate of 161,792 shares of the Company's
12% Series A Noncumulative Exchangeable Preferred Interests (the
"Preferred Shares"). Upon the occurrence of an Exchange Event (as defined
in the Purchase Agreement), each Preferred Share will be automatically
exchanged for one newly issued share of Series A Noncumulative Preferred
Stock of the Bank (the "Bank Preferred Stock"). In order to induce the
Initial Purchasers to enter into the Purchase Agreement, the Company and
the Bank have agreed to provide the registration rights set forth in this
Agreement for the benefit of the Initial Purchasers and their direct and
indirect transferees and assigns. The execution and delivery of this
Agreement is a condition to the Initial Purchasers' obligations to
purchase the Preferred Shares under the Purchase Agreement. Capitalized
terms used but not specifically defined herein have the respective
meanings ascribed thereto in the Purchase Agreement.
The parties hereby agree as follows:
1. Definitions. As used in this Agreement, the following
capitalized terms shall have the following meanings:
Broker-Dealer: Any broker or dealer registered under the
Exchange Act.
Closing Date: August 28, 2000.
Commission: The Securities and Exchange Commission.
Consummate: A registered Exchange Offer shall be deemed
"Consummated" for purposes of this Agreement upon the occurrence of
(a) (i) the filing and effectiveness under the Securities Act of the
Exchange Offer Registration Statement relating to the New Shares to be
issued in the Exchange Offer, (ii) the maintenance of the Exchange Offer
Registration Statement continuously effective and the keeping of the
Exchange Offer open for a period not less than the minimum period required
pursuant to Section 3(b) hereof, and (iii) the delivery by the Company of
the New Shares in the same aggregate liquidation preference as the
aggregate liquidation preference of Transfer Restricted Securities that
were validly tendered by Holders thereof pursuant to the Exchange Offer,
and (b) (i) the filing and effectiveness under the rules and regulations
of the OTS of the Exchange Offer Offering Circular relating to the New
Bank Shares to be issued in the Exchange Offer, (ii) the maintenance of
the Exchange Offer Offering Circular continuously effective and the
keeping of the Exchange Offer open for a period not less than the minimum
period required pursuant to Section 3(b) hereof, (iii) and if an Automatic
Exchange has occurred, the delivery by the Bank of the New Bank Shares in
the same aggregate liquidation preference as the aggregate liquidation
preference of Transfer Restricted Securities that were validly tendered by
Holders thereof pursuant to the Exchange Offer. If an Automatic Exchange
has occurred, an Exchange Offer shall be deemed Consummated if the
requirements of (b) of this definition have been met.
Effectiveness Target Date: As defined in Section 5(a) hereof.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Exchange Offer: Shall mean (A) if such Exchange Offer is
Consummated prior to an Automatic Exchange: (i) the registration by the
Bank under the rules and regulations of the OTS of the New Bank Shares
pursuant to an OTS Offering Circular and (ii) the registration by the
Company under the Securities Act of the New Shares pursuant to a
Registration Statement pursuant to which the Company offers the Holders of
all outstanding Transfer Restricted Securities the opportunity to exchange
all such outstanding Transfer Restricted Securities held by such Holders
for New Shares in an aggregate liquidation amount equal to the aggregate
amount of the Transfer Restricted Securities tendered in such exchange
offer by such Holders and (B) if such Exchange Offer is Consummated
following the occurrence of an Automatic Exchange: the registration by the
Bank under the rules and regulations of the OTS of the New Bank Shares
pursuant to an OTS Offering Circular pursuant to which the Bank offers the
Holders of all outstanding Transfer Restricted Securities the opportunity
to exchange all such outstanding Transfer Restricted Securities held by
such Holders for New Bank Shares in an aggregate liquidation amount equal
to the aggregate liquidation amount of the Transfer Restricted Securities
tendered in such exchange offer by such Holders.
Exchange Offer Offering Circular: The offering circular filed by
the Bank with the OTS relating to the Exchange Offer.
Exchange Offer Registration Statement: The registration
statement filed by the Company with the Commission relating to the
Exchange Offer, including the Prospectus which forms a part thereof.
Exempt Resales: The transactions in which the Initial Purchasers
propose to sell the Preferred Shares to certain "qualified institutional
buyers," as such term is defined in Rule 144A under the Securities Act.
Holders: As defined in Section 2(b) hereof.
Liquidated Damages: As defined in Section 5(a) hereof.
NASD: National Association of Securities Dealers, Inc.
New Bank Shares: The shares of preferred stock of the Bank to be
issued pursuant to the Exchange Offer.
New Shares: The preferred shares of the Company to be issued
pursuant to the Exchange Offer.
OTS: The Office of Thrift Supervision.
OTS Offering Circular: each of the Exchange Offer Offering
Circular and the Shelf Offering Circular filed pursuant to the provisions
of this Agreement, in either case including all amendments and supplements
thereto (including post-effective amendments) and all exhibits and
material incorporated by reference therein.
Participant: As defined in Section 8(a) hereof.
Person: An individual, partnership, corporation, limited
liability company, trust or unincorporated organization, or a government
or agency or political subdivision thereof.
Prospectus: The prospectus included in a Registration Statement which
shall include the OTS Offering Circular, as amended or supplemented by any
prospectus supplement and by all other amendments thereto, including post-
effective amendments, and all material incorporated by reference into such
Prospectus.
Registration Default: As defined in Section 5(a) hereof.
Registration Statement: each of the Exchange Offer Registration
Statement and the Shelf Registration Statement filed pursuant to the
provisions of this Agreement, in either case including the Prospectus
included therein, all amendments and supplements thereto (including post-
effective amendments) and all exhibits and material incorporated by
reference therein.
Securities Act: The Securities Act of 1933, as amended.
Shelf Filing Deadline: As defined in Section 4(a) hereof.
Shelf Offering Circular: As defined in Section 4(a) hereof.
Shelf Registration Statement: As defined in Section 4(a) hereof.
Transfer Restricted Securities: The Preferred Shares and Bank
Preferred Stock, until the earliest to occur of (a) the date on which such
Preferred Shares or Bank Preferred Stock, as the case may be, have been
exchanged by a person other than a Broker-Dealer for New Shares or New
Bank Shares, as the case may be, in the Exchange Offer, (b) following the
exchange by a Broker-Dealer in the Exchange Offer of Preferred Shares for
New Shares or of shares of Bank Preferred Stock for New Bank Shares, as
the case may be, the date on which such New Shares or New Bank Shares are
sold to a purchaser who receives from such Broker-Dealer on or prior to
the date of such sale a copy of the Prospectus contained in the Exchange
Offer Registration Statement, in the case of a sale of New Shares, or a
copy of the Exchange Offer Offering Circular, in the case of a sale of New
Bank Shares, (c) the date on which such Preferred Shares have been
effectively registered under the Securities Act and disposed of in
accordance with the Shelf Registration Statement or such Bank Preferred
Stock has been effectively registered under the rules and regulations of
the OTS and disposed of in accordance with the Shelf Offering Circular, or
(d) the date on which such Preferred Shares have been distributed to the
public pursuant to Rule 144 under the Securities Act or are saleable
pursuant to Rule 144(k) under the Securities Act or such Preferred Bank
Stock has been distributed to the public pursuant to the corresponding
rules and regulations of the OTS.
Underwritten Registration or Underwritten Offering: A registration in
which securities of the Company or the Bank are sold to an underwriter for
reoffering to the public.
2. Securities Subject to This Agreement.
(a) Transfer Restricted Securities: The securities entitled to
the benefits of this Agreement are the Transfer Restricted Securities.
(b) Holders of Transfer Restricted Securities. A Person is
deemed to be a holder of Transfer Restricted Securities (each such Person,
a "Holder") whenever such Person is the holder of record of Transfer
Restricted Securities.
3. Registered Exchange Offer.
(a) Unless the Exchange Offer shall not be permissible under
applicable law or Commission or OTS policy (after the procedures set forth
in Section 6(a) below have been complied with) or one of the events set
forth in Section 4(a)(ii) has occurred, (i) the Company shall file with
the Commission the Exchange Offer Registration Statement under the
Securities Act and the Bank shall file with the OTS the Exchange Offer
Offering Circular under the rules and regulations of the OTS, in each case
on or prior to Xxxxx 00, 0000, (xx) the Company shall use its reasonable
best efforts to cause the Exchange Offer Registration Statement to become
effective on or prior to August 31, 2001 and the Bank shall use its
reasonable best efforts to cause the Exchange Offer Offering Circular to
become effective on or prior to the date on which the Exchange Offer
Registration Statement is declared effective by the Commission or, in the
event of an Automatic Exchange, on or prior to Xxxxxx 00, 0000, (xxx) in
connection with the foregoing, (x) the Company shall file (A) all pre-
effective amendments to the Exchange Offer Registration Statement as may
be necessary in order to cause the Exchange Offer Registration Statement
to become effective, (B) if applicable, a post-effective amendment to the
Exchange Offer Registration Statement pursuant to Rule 430A under the
Securities Act and (C) all necessary filings in connection with the
registration and qualification of the New Shares to be made under the Blue
Sky laws of such jurisdictions as are necessary to permit Consummation of
the Exchange Offer, and (y) the Bank shall file (A) all pre-effective
amendments to the Exchange Offer Offering Circular as may be necessary in
order to cause the Exchange Offer Offering Circular to become effective,
(B) if applicable, a post-effective amendment to the Exchange Offer
Offering Circular pursuant to the rules and regulations of the OTS and
(C) all necessary filings in connection with the registration and
qualification of the New Bank Shares to be made under the Blue Sky laws
of such jurisdictions as are necessary to permit Consummation of the
Exchange Offer, and (iv) unless the Exchange Offer would not be permitted
by applicable law or Commission or OTS policy, (A) the Company will
commence the Exchange Offer and use its best efforts to issue on or prior
to 30 business days after the later of the date on which the Exchange
Offer Registration Statement was declared effective by the Commission or
the Exchange Offer Offering Circular was declared effective by the OTS,
New Shares in exchange for all Preferred Shares tendered prior thereto in
the Exchange Offer, or (B) in the event of an Automatic Exchange, the Bank
will commence the Exchange Offer and use its best efforts to issue on or
prior to 30 business days after the date on which the Exchange Offer
Offering Circular was declared effective by the OTS, New Bank Shares in
exchange for all shares of Preferred Bank Stock tendered prior thereto in
the Exchange Offer. The Exchange Offer Registration Statement and
Exchange Offer Offering Circular shall each be on the appropriate form to
permit registration of the New Shares or New Bank Shares, as the case may
be, to be offered in exchange for the Transfer Restricted Securities and
resales of New Shares or New Bank Shares, as the case may be, held by
Broker-Dealers as contemplated by Section 3(c) below. The 30 business day
period referred to in clause (iv) of this Section 3(a) shall not include
any period during which the Company is pursuing a Commission ruling or the
Bank is pursuing an OTS ruling pursuant to Section 6(a)(i) below.
(b) (i) The Company shall use its best efforts to cause the
Exchange Offer Registration Statement to be effective continuously and
shall keep the Exchange Offer open for a period of not less than the
minimum period required under applicable federal and state securities laws
to Consummate the Exchange Offer; provided, however, that in no event
shall such period be less than 20 business days. The Company shall cause
the Exchange Offer to comply in all material respects with all applicable
federal and state securities laws. No securities other than the New
Shares shall be included in the Exchange Offer Registration Statement.
The Company shall use its best efforts to cause the Exchange Offer to be
Consummated on the earliest practicable date after the later of the
respective dates on which the Exchange Offer Registration Statement and
the Exchange Offer Offering Circular have become effective, but in no
event later than 30 business days thereafter.
(ii) The Bank shall use its best efforts to cause the
Exchange Offer Offering Circular to be effective continuously and shall
keep the Exchange Offer open for a period of not less than the minimum
period required under applicable federal and state securities laws to
Consummate the Exchange Offer; provided, however, that in no event shall
such period be less than 20 business days. The Bank shall cause the
Exchange Offer to comply in all material respects with all applicable
federal and state securities laws. No securities other than the New Bank
Shares shall be included in the Exchange Offer Offering Circular. The
Bank shall use its best efforts to cause the Exchange Offer to be
Consummated on the earliest practicable date after the later of the
respective dates on which the Exchange Offer Offering Circular and the
Exchange Offer Registration Statement have become effective, but in no
event later than 30 business days thereafter.
(c) The Company or the Bank, as the case may be, shall indicate
in a "Plan of Distribution" section contained in the Prospectus contained
in the Exchange Offer Registration Statement or the Exchange Offer
Offering Circular, as the case may be, that any Broker-Dealer who holds
Preferred Shares or Preferred Bank Stock, as the case may be, that are
Transfer Restricted Securities and that were acquired for its own account
as a result of market-making activities or other trading activities (other
than Transfer Restricted Securities acquired directly from the Company or
the Bank), may exchange such Preferred Shares or Bank Preferred Stock, as
the case may be, pursuant to the Exchange Offer; however, such Broker-
Dealer may be deemed to be an "underwriter" within the meaning of the
Securities Act and the rules and regulations of the OTS and must,
therefore, deliver a prospectus meeting the requirements of the Securities
Act and the rules and regulations of the OTS in connection with any
resales of the New Shares or New Bank Shares received by such Broker-
Dealer in the Exchange Offer, which prospectus delivery requirement may be
satisfied by the delivery by such Broker-Dealer of the Prospectus
contained in the Exchange Offer Registration Statement or the Exchange
Offer Offering Circular, as the case may be. Such "Plan of Distribution"
section shall also contain all other information with respect to such
resales by Broker-Dealers that the Commission or the OTS, as the case may
be, may require in order to permit such resales pursuant thereto, but
such "Plan of Distribution" shall not name any such Broker-Dealer or
disclose the amount of New Shares or New Bank Shares held by any such
Broker-Dealer except to the extent required by the Commission or the OTS.
The Company and the Bank shall each use their reasonable best
efforts to keep the Exchange Offer Registration Statement and Exchange
Offer Offering Circular continuously effective, supplemented and amended
as required by the provisions of Section 6(c) below to the extent
necessary to ensure that it is available for resales of New Shares or New
Bank Shares, as the case may be, acquired by Broker-Dealers for their own
accounts as a result of market-making activities or other trading
activities and to ensure that it conforms with the requirements of this
Agreement, the Securities Act and the policies, rules and regulations of
the Commission and the rules and regulations of the OTS as announced from
time to time, for a period of 180 days from the later of the respective
dates on which the Exchange Offer Registration Statement or Exchange Offer
Offering Circular is declared effective.
The Company and Bank shall provide sufficient copies of the
latest version of such Prospectus or Exchange Offer Offering Circular to
Broker-Dealers promptly upon request at any time during such 180-day
period in order to facilitate such resales.
4. Shelf Registration.
(a) Shelf Registration. If (i) the Company or the Bank is not
required to file an Exchange Offer Registration Statement or Exchange
Offer Offering Circular or to Consummate the Exchange Offer because the
Exchange Offer is not permitted by applicable law or Commission or OTS
policy (after the procedures set forth in Section 6(a) below have been
complied with) or (ii) if any Holder of Transfer Restricted Securities
that is a "qualified institutional buyer" (as defined in Rule 144A under
the Securities Act) shall notify the Company, or in the event of an
Automatic Exchange, the Bank, at least 20 business days prior to the
Consummation of the Exchange Offer that (A) such Holder is prohibited by
applicable law or Commission or OTS policy from participating in the
Exchange Offer or (B) such Holder may not resell the New Shares or New
Bank Shares, as the case may be, acquired by it in the Exchange Offer to
the public without delivering a prospectus and that the Prospectus
contained in the Exchange Offer Registration Statement or the Exchange
Offer Offering Circular, as the case may be, is not appropriate or
available for such resales by such Holder or (C) such Holder is a Broker-
Dealer and holds Preferred Shares acquired directly from the Company or
one of its affiliates or Bank Preferred Stock acquired directly from the
Bank or one of its affiliates, then the Company and the Bank shall in lieu
of, or in the event of (ii) above, in addition to, effecting the
registration of the New Shares pursuant to the Exchange Offer Registration
Statement and the New Bank Shares pursuant to the Exchange Offer Offering
Circular use their best efforts to:
(x) cause to be filed a shelf registration statement
pursuant to Rule 415 under the Securities Act, which may be
an amendment to the Exchange Offer Registration Statement
(in either event, the "Shelf Registration Statement") and a
shelf offering circular pursuant to the rules and
regulations of the OTS, which may be an amendment to the
Exchange Offer Offering Circular (in either event, the
"Shelf Offering Circular"), on or prior to the earlier to
occur of (1) the 90th day after the date on which the
Company determines that it is not required to file the
Exchange Offer Registration Statement or Exchange Offer
Offering Circular or (2) the 90th day after the date on
which the Company receives notice from a Holder of Transfer
Restricted Securities as contemplated by clause (ii) of
paragraph (a) above (such earlier date being the "Shelf
Filing Deadline"), which Shelf Registration Statement and
Shelf Offering Circular shall each provide for resales of
all Transfer Restricted Securities the Holders of which
shall have provided the information required pursuant to
Section 4(b) hereof; and
(y) cause such Shelf Registration Statement and Shelf
Offering Circular to be declared effective by the
Commission and OTS, respectively, on or before the 90th day
after the Shelf Filing Deadline.
The Company shall use its best efforts to keep such Shelf Registration
Statement and the Bank shall use its best efforts to keep such Shelf
Offering Circular continuously effective, supplemented and amended as
required by the provisions of Sections 6(b) and (c) hereof to the extent
necessary to ensure that it is available for resales of Preferred Shares,
or in the case of an Automatic Exchange, Bank Preferred Stock, by the
Holders of Transfer Restricted Securities entitled to the benefit of this
Section 4(a) and to ensure that it conforms with the requirements of this
Agreement, the Securities Act, the policies, rules and regulations of the
Commission and the rules and regulations of the OTS, each as announced
from time to time, for a period of at least six months (as extended
pursuant to Section 6(c)) following the later of the date on which such
Shelf Registration Statement first becomes effective under the Securities
Act or such Shelf Offering Circular first becomes effective under the
rules and regulations of the OTS, or such shorter period as will terminate
when all Transfer Restricted Securities covered by such Registration
Statement and/or Shelf Offering Circular have been sold pursuant thereto;
provided however, that the foregoing shall not apply if the effective
Shelf Registration Statement and Shelf Offering Circular would in the
reasonable good faith judgment of the Company and the Bank materially
interfere with or materially and adversely affect any pending or proposed
acquisition, merger, recapitalization, consolidation, reorganization,
financing or other material event or transaction, or negotiations,
discussions or pending proposals with respect thereto so long as the
Company and the Bank within 3 months thereafter complies with the
requirements of Section 6(c)(xiv) hereof. Any such period during which the
Company or Bank fails to keep the Shelf Registration Statement or Shelf
Offering Circular effective and usable for offers and sales of Transfer
Restricted Securities is referred to as a "Suspension Period." A
Suspension Period shall commence on and include the date that the Company
gives notice that the Shelf Registration Statement or Shelf Offering
Circular are no longer effective or the prospectus included therein is no
longer usable for offers and sales of Transfer Restricted Securities and
shall end on the date when each Holder of Transfer Restricted Securities
covered by such Shelf Registration Statement and Shelf Offering Circular
either receives the copies of the supplemented or amended prospectus
contemplated by Section 6(c)(xiv) hereof or is advised in writing by the
Company that use of the prospectus may be resumed. If one or more
Suspension Periods occur, the six month time period referenced above shall
be extended by the aggregate of the number of days included in each such
Suspension Period.
(b) Provision by Holders of Certain Information in Connection
with the Shelf Registration Statement and Shelf Offering Circular. No
Holder of Transfer Restricted Securities may include any of its Transfer
Restricted Securities in any Shelf Registration Statement or Shelf
Offering Circular pursuant to this Agreement unless and until such Holder
furnishes to the Bank in writing, within 20 days after receipt of a
written request therefor, such information as the Bank may reasonably
request for use in connection with any Shelf Registration Statement (or
Prospectus or preliminary Prospectus included therein) or Shelf Offering
Circular in order to comply with applicable law, the policies, rules and
regulations of the Commission and the rules and regulations of the OTS.
No Holder of Transfer Restricted Securities shall be entitled to
Liquidated Damages pursuant to Section 5 hereof unless and until such
Holder shall have used its best efforts to provide all such reasonably
requested information. Each Holder as to which any Shelf Registration
Statement or Shelf Offering Circular is being effected agrees to furnish
promptly to the Company and the Bank all information required to be
disclosed in order to make the information previously furnished to the
Company and the Bank by such Holder not materially misleading.
5. Liquidated Damages.
(a) If (a) any of the Registration Statements or OTS Offering
Circulars required by this Agreement is not filed with the Commission or
the OTS, as the case may be, on or prior to the date specified for such
filing in this Agreement, (b) any of such Registration Statements or OTS
Offering Circulars has not been declared effective by the Commission or
the OTS, as the case may be, on or prior to the date specified for such
effectiveness in this Agreement (the "Effectiveness Target Date"), (c) the
Exchange Offer has not been Consummated within 30 business days after the
Effectiveness Target Date with respect to the Exchange Offer Registration
Statement or Exchange Offer Offering Circular or (d) any Registration
Statement or OTS Offering Circular required by this Agreement is filed and
declared effective but shall thereafter cease to be effective or fail to
be usable (at any time that the Company and the Bank are obligated to
maintain the effectiveness of usability thereof) for its intended purpose
without being succeeded within five business days by a post-effective
amendment to such Registration Statement or OTS Offering Circular, as the
case may be, that cures such failure and that is itself immediately
declared effective (each such event referred to in clauses (a) through
(d), a "Registration Default"), the Bank shall accrue and pay additional
sums ("Liquidated Damages") to each holder of the Preferred Shares with
respect to the first 7-day period immediately following the occurrence of
such Registration Default, in each case in an amount equal to ten (10)
basis points (.10%) per annum of the aggregate liquidation preference of
such Preferred Shares (calculated on an annualized basis). The amount of
Liquidated Damages will increase by an additional ten (10) basis points
(.10%) per annum with respect to each subsequent 7-day period until all
Registration Defaults have been cured, up to a maximum amount of fifty
(50) basis points (.50%) per annum. All accrued Liquidated Damages shall
be paid to Holders by the Bank in the same manner and at the same times as
regular scheduled dividends are paid on the Preferred Shares (except that
such Liquidated Damages shall be paid whether or not the Company elects to
pay the regular scheduled dividends on the Preferred Shares on such
dividend payment dates). Following the cure of all Registration Defaults
relating to any particular Transfer Restricted Securities, the accrual of
Liquidated Damages with respect to such Transfer Restricted Securities
will cease. In the event of any Registration Default after an Automatic
Exchange, the Bank shall pay such Liquidated Damages to holders of the
Bank Preferred Stock.
All obligations of the Company and the Bank set forth in the
preceding paragraph that have accrued and are outstanding with respect to
any Transfer Restricted Security at the time such security ceases to be a
Transfer Restricted Security shall survive until such time as all such
obligations with respect to such Transfer Restricted Security shall have
been satisfied in full.
(b) Special Dividends and Liquidated Damages shall be paid to
DTC by wire transfer of immediately available funds or by federal funds
check and to holders of certificated securities by wire transfer to the
accounts specified by them or by mailing checks to their registered
addresses if no accounts have been specified. Each obligation to pay
Special Dividends or Liquidated Damages, as the case may be, shall be
deemed to accrue from the applicable date of the occurrence of the
Registration Default.
6. Registration Procedures.
(a) Exchange Offer Registration Statement/Exchange Offer
Offering Circular. In connection with the Exchange Offer, the Company and
the Bank shall each comply with all of the provisions of Section 6(c)
below, shall use their respective reasonable best efforts to effect such
exchange to permit the sale of Transfer Restricted Securities being sold
in accordance with the intended method or methods of distribution thereof,
and shall comply with all of the following provisions:
(i) If in the reasonable opinion of counsel to the Company
and the Bank there is a question as to whether the Exchange Offer is
permitted by applicable law, the Company or the Bank, as the case may be,
hereby agrees to seek a no-action letter or other favorable decision from
the Commission or the OTS, as the case may be, allowing the Company or the
Bank to Consummate the Exchange Offer. The Company and the Bank each
hereby agrees to pursue the issuance of such a decision to the Commission
or OTS staff level, as the case may be, but shall not be required to take
commercially unreasonable action to effect a change of Commission or OTS
policy. The Company and the Bank hereby agree, however, to
(A) participate in telephonic conferences with the Commission or OTS, as
the case may be, (B) deliver to the Commission or OTS staff an analysis
prepared by counsel to the Company and the Bank setting forth the legal
bases, if any, upon which such counsel has concluded that the Exchange
Offer should be permitted and (C) diligently pursue a resolution by the
Commission or OTS staff of such submission.
(ii) As a condition to its participation in the Exchange
Offer pursuant to the terms of this Agreement, each Holder of Transfer
Restricted Securities shall furnish, upon the request of the Company and
the Bank, prior to the Consummation thereof, a written representation to
the Company and the Bank (which may be contained in the letter of
transmittal contemplated by the Exchange Offer Registration Statement or
Exchange Offer Offering Circular) to the effect that (A) it is not an
affiliate of the Company or the Bank, (B) it is not engaged in, and does
not intend to engage in, and has no arrangement or understanding with any
person to participate in, a distribution of the New Shares or, if an
Automatic Exchange has occurred, the New Bank Shares, to be issued in the
Exchange Offer and (C) it is acquiring the New Shares or New Bank Shares,
as the case may be, in its ordinary course of business. Each Holder may
also be required to acknowledge and agree that any Broker-Dealer and any
such Holder using the Exchange Offer to participate in a distribution of
the securities to be acquired in the Exchange Offer (1) could not under
Commission policy as in effect on the date of this Agreement rely on the
position of the Commission enunciated in Xxxxxx Xxxxxxx and Co., Inc.
(available June 5, 1991) and Exxon Capital Holdings Corporation (available
May 13, 1988), as interpreted in the Commission's letter to Shearman &
Sterling dated July 2, 1993, and similar no-action letters (including
Xxxxx & Xxxx LLP (available February 7, 1997), and any no-action letter
obtained pursuant to clause (i) above) and (2) must comply with the
registration and prospectus delivery requirements of the Securities Act
and the rules and regulations of the OTS in connection with a secondary
resale transaction and that in the case of resales of New Shares and New
Bank Shares, such a secondary resale transaction should be covered by an
effective registration statement and an effective offering circular
containing the selling security holder information required by the
applicable rules and regulations of the Commission and of the OTS if the
resales are of New Shares or New Bank Shares obtained by such Holder in
exchange for Preferred Shares acquired by such Holder directly from the
Company.
(iii) Prior to the effectiveness of the Exchange Offer
Registration Statement, the Company shall provide a supplemental letter to
the Commission (A) stating that the Company is registering the Exchange
Offer in reliance on the position of the Commission enunciated in Exxon
Capital Holdings Corporation (available May 13, 1988), Xxxxxx Xxxxxxx and
Co., Inc. (available June 5, 1991), Xxxxx & Wood LLP (available February
7, 1997) and, if applicable, any no-action letter obtained pursuant to
clause (i) above and (B) including a representation that the Company has
not entered into any arrangement or understanding with any Person to
distribute the New Shares to be received in the Exchange Offer and that,
to the best of the Company's information and belief, each Holder
participating in the Exchange Offer is acquiring the New Shares in its
ordinary course of business and has no arrangement or understanding with
any Person to participate in the distribution of the New Shares received
in the Exchange Offer. To the extent required by the OTS, the Bank shall
provide similar undertakings to the OTS prior to the effectiveness of the
Exchange Offer Offering Circular.
(b) Shelf Registration Statement/Shelf Offering Circular.
In connection with the Shelf Registration Statement and Shelf Offering
Circular, the Company and the Bank shall each comply with all the
provisions of Section 6(c) below and shall use their respective reasonable
best efforts to effect such registration to permit the sale of the
Transfer Restricted Securities being sold in accordance with the intended
method or methods of distribution thereof, and pursuant thereto (i) the
Company will prepare and file with the Commission a Registration Statement
relating to the registration on any appropriate form under the Securities
Act, which form shall be available for the sale of the Transfer Restricted
Securities in accordance with the intended method or methods of
distribution thereof within the time periods and otherwise in accordance
with the provisions hereof and (ii) the Bank will prepare and file with
the OTS an OTS Offering Circular relating to the registration for the sale
of the Transfer Restricted Securities in accordance with the intended
method or methods of distribution thereof within the time periods and
otherwise in accordance with the provisions hereof.
(c) General Provisions. In connection with any Registration
Statement, Prospectus or OTS Offering Circular required by this Agreement
to permit the sale or resale of Transfer Restricted Securities (including,
without limitation, any Registration Statement and the related Prospectus
or any OTS Offering Circular required to permit resales of Preferred
Shares or Bank Preferred Stock by Broker-Dealers), the Company and Bank
shall each:
(i) use their respective reasonable best efforts to keep
such Registration Statement or OTS Offering Circular, as the case may be,
continuously effective and provide all requisite financial statements for
the period specified in Section 3 or 4 of this Agreement, as applicable
(subject to the proviso set forth in the last paragraph of Section 4(a) of
this Agreement); upon the occurrence of any event that would cause any
such Registration Statement or the Prospectus contained therein or any
such OTS Offering Circular (A) to contain a material misstatement or
omission or (B) not to be effective and usable for resale of Transfer
Restricted Securities during the period required by this Agreement, the
Company and the Bank shall file promptly an appropriate amendment to such
Registration Statement and OTS Offering Circular, respectively, in the
case of clause (A), correcting any such misstatement or omission, and, in
the case of either clause (A) or (B), use its reasonable best efforts to
cause such amendment to be declared effective and such Registration
Statement and the related Prospectus or OTS Offering Circular, as the case
may be, to become usable for their intended purpose(s) as soon as
practicable thereafter;
(ii) prepare and file with the Commission and OTS such
amendments and post-effective amendments to the Registration Statement and
OTS Offering Circular, respectively, as may be necessary to keep the
Registration Statement and OTS Offering Circular effective for the
applicable period set forth in Section 3 or 4 hereof, as applicable
(subject to the proviso set forth in the last paragraph of Section 4(a) of
this Agreement), or such shorter period as will terminate when all
Transfer Restricted Securities covered by such Registration Statement and
OTS Offering Circular have been sold; cause the Prospectus and OTS
Offering Circular to be supplemented by any required supplement, and as so
supplemented to be filed pursuant to and to comply fully with the
applicable rules and regulations of the Commission and of the OTS in a
timely manner; and comply with the provisions of the Securities Act and
OTS rules and regulations with respect to the disposition of all
securities covered by such Registration Statement and OTS Offering
Circular during the applicable period in accordance with the intended
method or methods of distribution by the sellers thereof set forth in such
Registration Statement or supplement to the Prospectus and OTS Offering
Circular;
(iii) in the case of a Shelf Registration Statement and
Shelf Offering Circular, advise the underwriter(s), if any, and selling
Holders promptly and, if requested by such Persons, confirm such advice in
writing, (A) when the Prospectus or any Prospectus supplement or Offering
Circular supplement or post-effective amendment has been filed, and, with
respect to any Registration Statement or OTS Offering Circular or any
post-effective amendment thereto, when the same has become effective,
(B) of any request by the Commission or OTS for amendments to the
Registration Statement or OTS Offering Circular or amendments or
supplements to the Prospectus or for additional information relating
thereto, (C) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement under the
Securities Act or by the OTS of any stop order suspending the
effectiveness of the OTS Offering Circular under the rules and regulations
of the OTS or of the suspension by any state securities commission of the
qualification of the Transfer Restricted Securities for offering or sale
in any jurisdiction, or the initiation of any proceeding for any of the
preceding purposes, or (D) of the existence of any fact or the happening
of any event that makes any statement of a material fact made in the
Registration Statement, the Prospectus, the OTS Offering Circular, any
amendment or supplement thereto, or any document incorporated by reference
therein untrue, or that requires the making of any additions to or changes
in the Registration Statement or the Prospectus or OTS Offering Circular
in order to make the statements therein not misleading in any material
respect; and if at any time the Commission shall issue any stop order
suspending the effectiveness of the Registration Statement, or the OTS
shall issue any stop order suspending the effectiveness of the OTS
Offering Circular under the rules and regulations of the OTS, or any state
securities commission or other regulatory authority shall issue an order
suspending the qualification or exemption from qualification of the
Transfer Restricted Securities under state securities or Blue Sky laws,
the Company and the Bank shall each use its reasonable best efforts to
obtain the withdrawal or lifting of such order at the earliest possible
time;
(iv) in the case of a Shelf Registration Statement and
Shelf Offering Circular, furnish to each of the selling Holders and each
of the underwriter(s), if any, before filing with the Commission and OTS,
copies of any Registration Statement or any Prospectus included therein
and any OTS Offering Circular, or any amendments or supplements to any
such Registration Statement or Prospectus and OTS Offering Circular
(including all documents incorporated by reference after the initial
filing of such Registration Statement or OTS Offering Circular, if any),
which documents will be subject to the review of such Holders and
underwriter(s), if any, for a period of at least five business days,
subject to customary and reasonable confidentiality restrictions, and the
Company and Bank will not file any such Registration Statement or
Prospectus or OTS Offering Circular or any amendment or supplement to any
such Registration Statement or Prospectus or OTS Offering Circular
(including all such documents incorporated by reference) to which Holders
of a majority in aggregate liquidation preference of Transfer Restricted
Securities covered by such Registration Statement and OTS Offering
Circular or the underwriter(s), if any, shall reasonably object within
five business days after the receipt thereof. A selling Holder or
underwriter, if any, shall be deemed to have reasonably objected to such
filing if such Registration Statement, OTS Offering Circular, amendment,
Prospectus or supplement, as applicable, as proposed to be filed, contains
a material misstatement or omission;
(v) in the case of a Shelf Registration Statement and Shelf
Offering Circular, make available at reasonable times for inspection by
the selling Holders, any underwriter participating in any disposition
pursuant to such Registration Statement and Shelf Offering Circular, and
any attorney or accountant retained by such selling Holders or any of the
underwriter(s), all financial and other records, pertinent corporate
documents and properties of the Company and the Bank and cause the
Company's and Bank's officers, directors, managers and employees to supply
all information reasonably requested by any such Holder, underwriter,
attorney or accountant in connection with such Registration Statement and
OTS Offering Circular, subject to customary and reasonable confidentiality
restrictions, subsequent to the filing thereof and prior to its
effectiveness;
(vi) in the case of a Shelf Registration Statement and
Shelf Offering Circular, if requested by any selling Holders or the
underwriter(s), if any, at the expense of such selling Holders or
underwriter(s) promptly incorporate in any Registration Statement or
Prospectus and OTS Offering Circular, pursuant to a supplement or post-
effective amendment if necessary, such information as such selling Holders
and underwriter(s), if any, may reasonably request to have included
therein relating to the proposed distribution or other sale as required by
applicable Commission or OTS rules or policies, including, without
limitation, information relating to the "Plan of Distribution" of the
Transfer Restricted Securities, information with respect to the aggregate
liquidation preference of Transfer Restricted Securities being sold to
such underwriter(s), the purchase price being paid therefor and any other
terms of the offering of the Transfer Restricted Securities to be sold in
such offering, and at the expense of such selling Holders or
underwriter(s) make all required filings of such Prospectus, OTS Offering
Circular, supplement or post-effective amendment as soon as practicable
after the Company and the Bank are notified of the matters to be
incorporated in such Prospectus supplement or post-effective amendment;
(vii) in the case of a Shelf Registration Statement and
Shelf Offering Circular, furnish to each selling Holder and each of the
underwriter(s), if any, without charge, at least one copy of the
Registration Statement, as first filed with the Commission, and the Shelf
Offering Circular, as first filed with the OTS, and of each amendment
thereto, including all documents incorporated by reference therein, if
any, and all exhibits (including exhibits incorporated therein by
reference);
(viii) in the case of a Shelf Registration Statement and
Shelf Offering Circular, deliver to each selling Holder, without charge,
and each of the underwriter(s), if any, at such underwriter's expense, as
many copies of the Prospectus (including each preliminary prospectus) and
OTS Offering Circular (including each preliminary offering circular) and
any amendment or supplement thereto as such Persons reasonably may
request; the Company and the Bank hereby consent to the use of the
Prospectus and OTS Offering Circular and any amendment or supplement
thereto by each of the selling Holders and each of the underwriter(s), if
any, in connection with the offering and the sale of the Transfer
Restricted Securities covered by the Prospectus and OTS Offering Circular
or any amendment or supplement thereto;
(ix) in the case of a Shelf Registration Statement and
Shelf Offering Circular, enter into such agreements (including an
underwriting agreement) and make such representations and warranties, and
take all such other actions in connection therewith, in order to expedite
or facilitate the disposition of the Transfer Restricted Securities
pursuant to any Registration Statement and OTS Offering Circular
contemplated by this Agreement, all to such extent as may be reasonably
requested by any purchaser or by any Holder of Transfer Restricted
Securities or underwriter, if any, in connection with any sale or resale
pursuant to any Registration Statement or OTS Offering Circular
contemplated by this Agreement; and in connection with an Underwritten
Registration (provided that the Company and the Bank shall not be
obligated to participate in more than one Underwritten Offering and such
Underwritten Offering shall include Transfer Restricted Securities
representing not less than 1/3 of the aggregate liquidation preference of
all Transfer Restricted Securities then outstanding), the Company and Bank
shall at the expense of the Selling Holders and the underwriters:
(A) upon request, furnish (or in the case of
paragraphs (i) and (iii), use its reasonable best efforts to furnish) to
each selling Holder and each underwriter, if any, in such substance and
scope as they may reasonably request and as are customarily made by
issuers to underwriters in primary underwritten offerings, upon the later
of the date of effectiveness of the Shelf Registration Statement or the
Shelf Offering Circular:
(1) a certificate from each of the Bank and the
Company, dated the later of the date of the effectiveness of the Shelf
Registration Statement or Shelf Offering Circular, signed by (y) the
Chairman of the Board, its President or an Executive Vice President and
(z) the Chief Financial Officer of the Company or the Bank, as the case
may be, confirming, as of the date thereof, such matters as such parties
may reasonably request;
(2) an opinion, dated the later of the date of
the effectiveness of the Shelf Registration Statement or Shelf Offering
Circular, of counsel for the Company and the Bank, covering such matters
as such parties may reasonably request, and in any event including a
statement to the effect that such counsel has participated in conferences
with officers and other representatives of the Company and the Bank,
representatives of the independent public accountants for the Company and
the Bank, the Initial Purchasers' representatives and the Initial
Purchasers' counsel in connection with the preparation of such
Registration Statement and the related Prospectus and such OTS Offering
Circular and have considered the matters required to be stated therein and
the statements contained therein, and that such counsel advises that, on
the basis of the foregoing, no facts came to such counsel's attention that
caused such counsel to believe that the applicable Registration Statement,
at the time such Registration Statement or any post-effective amendment
thereto became effective, contained an untrue statement of a material fact
or omitted to state a material fact required to be stated therein or
necessary to make the statements therein not misleading or that the
Prospectus contained in such Registration Statement, as of its date,
contained an untrue statement of a material fact or omitted to state a
material fact necessary in order to make the statements therein, in light
of the circumstances under which they were made, not misleading or that
the applicable OTS Offering Circular, at the time such OTS Offering
Circular or any post-effective amendment thereto became effective,
contained an untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading. Without limiting the foregoing, such
counsel may state further that such counsel assumes no responsibility for,
and has not independently verified, the accuracy, completeness or fairness
of the statements contained therein and also expresses no view as to the
financial statements, notes and schedules and other financial and
statistical data included in any Registration Statement contemplated by
this Agreement or the related Prospectus or any OTS Offering Circular
contemplated by this Agreement; and
(3) a customary comfort letter, dated the later
of the date of the effectiveness of the Shelf Registration Statement and
the Shelf Offering Circular, from the Bank's and the Company's independent
accountants, in the customary form and covering matters of the type
customarily covered in comfort letters by underwriters in connection with
primary underwritten offerings;
(B) set forth in full or incorporate by reference in
the underwriting agreement, if any, the indemnification provisions and
procedures of Section 8 hereof with respect to all parties to be
indemnified pursuant to said Section; and
(C) deliver such other documents and certificates as
may be reasonably requested by such parties to evidence compliance with
clause (A) above and with any other customary conditions contained in the
underwriting agreement or other agreement entered into by the Company or
the Bank pursuant to this clause (xi), if any.
(x) in the case of a Shelf Registration Statement and Shelf
Offering Circular, prior to any public offering of Transfer Restricted
Securities, at the expense of the selling Holders and the underwriter(s),
if any, cooperate with the selling Holders, the underwriter(s), if any,
and their respective counsel in connection with the registration and
qualification of the Transfer Restricted Securities under the securities
or Blue Sky laws of such jurisdictions as the selling Holders or
underwriter(s) may reasonably request and do any and all other acts or
things necessary or advisable to enable the disposition in such
jurisdictions of the Transfer Restricted Securities covered by the Shelf
Registration Statement and Shelf Offering Circular; provided, however,
that the Company and the Bank shall not be required to register or qualify
as a foreign corporation where they are not now so qualified or to take
any action that would subject them to service of process in suits or to
taxation, other than as to matters and transactions relating to the
Registration Statement or the OTS Offering Circular, in any jurisdiction
where they are not now so subject;
(xi) in the case of (a) an Exchange Offer Registration
Statement, shall issue, upon the request of any Holder of Preferred Shares
covered by the Exchange Offer Registration Statement, New Shares in the
same aggregate liquidation preference as the Preferred Shares surrendered
to the Company by such Holder in exchange therefor or being sold by such
Holder, such New Shares to be registered in the name of such Holder or in
the name of the purchaser(s) of such Preferred Shares, as the case may be;
in return, the Preferred Shares held by such Holder shall be surrendered
to the Company for cancellation or (b) an Exchange Offer Offering
Circular, in the event of an Automatic Exchange, shall issue, upon the
request of any Holder of Bank Preferred Stock covered by the Exchange
Offer Offering Circular, New Bank Shares in the same aggregate liquidation
preference as the Preferred Bank Stock surrendered to the Bank by such
Holder in exchange therefor or being sold by such Holder, such New Bank
Shares to be registered in the name of such Holder or in the name of the
purchaser(s) of such Preferred Bank Stock, as the case may be; in return,
the Preferred Bank Stock held by such Holder shall be surrendered to the
Bank for cancellation;
(xii) in the case of a Shelf Registration Statement and
Shelf Offering Circular, cooperate with the selling Holders and the
underwriter(s), if any, to facilitate the timely preparation and delivery
of certificates representing Transfer Restricted Securities to be sold and
not bearing any restrictive legends and enable such Transfer Restricted
Securities to be in such denominations and registered in such names as the
Holders or the underwriter(s), if any, may request at least two business
days prior to settlement of any sale of Transfer Restricted Securities
made by such underwriter(s);
(xiii) use its reasonable best efforts to cause the Transfer
Restricted Securities covered by the Registration Statement and OTS
Offering Circular to be registered with or approved by such other
governmental agencies or authorities, if any, as may be necessary to
enable the seller or sellers thereof or the underwriter(s), if any, to
consummate the disposition of such Transfer Restricted Securities, subject
to the proviso contained in clause (xii) above;
(xiv) if any fact or event contemplated by
clause (c)(iii)(D) above shall exist or have occurred, prepare a
supplement or post-effective amendment to the Registration Statement or
related Prospectus or OTS Offering Circular or any document incorporated
therein by reference or file any other required document so that, as
thereafter delivered to the purchasers of Transfer Restricted Securities,
the Prospectus or OTS Offering Circular will not contain an untrue
statement of a material fact or omit to state any material fact necessary
to make the statements therein not misleading;
(xv) obtain CUSIP numbers (if not previously obtained) for
all Transfer Restricted Securities not later than the later of the
effective date of the Registration Statement and OTS Offering Circular and
provide certificates for the Transfer Restricted Securities;
(xvi) cooperate and assist in any filings required to be
made with the NASD and in the performance of any due diligence
investigation by any underwriter (including any "qualified independent
underwriter") that is required to be retained in accordance with the rules
and regulations of the NASD;
(xvii) otherwise use its reasonable best efforts to comply
with all applicable rules and regulations of the Commission and OTS, and
make generally available to its security holders, as soon as practicable,
a consolidated earning statement meeting the requirements of Rule 158
under the Securities Act (which need not be audited) for the twelve-month
period (A) commencing at the end of the fiscal quarter in which the
effective date of the Registration Statement and the OTS Offering Circular
occurs; and
(xvii) provide promptly to each Holder upon request each
document filed with the Commission and the OTS pursuant to the
requirements of Section 13 and Section 15 of the Exchange Act.
Each Holder agrees by acquisition of a Transfer Restricted
Security that, upon receipt of any notice from the Company or the Bank of
the existence of any fact of the kind described in Section 6(c)(iii)(D)
hereof, such Holder will forthwith discontinue disposition of Transfer
Restricted Securities pursuant to the applicable Registration Statement
and OTS Offering Circular until such Holder's receipt of the copies of the
supplemented or amended Prospectus or OTS Offering Circular contemplated
by Section 6(c)(xiv) hereof, or until it is advised in writing (the
"Advice") by the Company or the Bank that the use of the Prospectus or OTS
Offering Circular may be resumed, and has received copies of any
additional or supplemental filings that are incorporated by reference in
the Prospectus or OTS Offering Circular. If so directed by the Company
and the Bank each Holder will deliver to the Bank (at the Bank's expense)
all copies, other than permanent file copies then in such Holder's
possession, of the Prospectus and OTS Offering Circular covering such
Transfer Restricted Securities that was current at the time of receipt of
such notice to discontinue such disposition of Transfer Restricted
Securities. In the event the Company and the Bank shall give any such
notice, the time period regarding the effectiveness of such Registration
Statement and OTS Offering Circular set forth in Section 3 or 4 hereof, as
applicable, shall be extended by the number of days during the period from
and including the date of the giving of such notice pursuant to Section
6(c)(iii)(D) hereof to and including the date when each selling Holder of
Transfer Restricted Securities covered by such Registration Statement and
OTS Offering Circular shall have received the copies of the supplemented
or amended Prospectus and OTS Offering Circular contemplated by Section
6(c)(xiv) hereof or shall have received the Advice.
7. Registration Expenses.
Except as otherwise expressly provided herein, all expenses
incident to the Company's and the Bank's performance of or compliance with
this Agreement will be borne by the Company and the Bank, regardless of
whether a Registration Statement or OTS Offering Circular becomes
effective, including without limitation: (i) all registration and filing
fees and expenses; (ii) all fees and expenses of compliance with federal
securities and state Blue Sky or securities laws; (iii) all expenses of
printing (including printing certificates for the New Shares or New Bank
Shares to be issued in the Exchange Offer and printing of Prospectuses and
OTS Offering Circulars), and associated messenger and delivery services
and telephone; (iv) all fees and disbursements of counsel for the Company
and the Bank; and (v) all fees and disbursements of independent certified
public accountants of the Company and the Bank (including the expenses of
any special audit and comfort letters required by or incident to such
performance).
The Company and the Bank will, in any event, each bear its
respective internal expenses (including, without limitation, all salaries
and expenses of its officers and employees performing legal or accounting
duties), the expenses of any annual audit and the fees and expenses of any
Person, including special experts, retained by the Company or the Bank, as
the case may be.
8. Indemnification and Contribution.
(a) In connection with a Shelf Registration Statement or Shelf
Offering Circular or in connection with any delivery of a Prospectus
contained in an Exchange Offer Registration Statement or of an Exchange
Offer Offering Circular by any participating Broker-Dealer or the Initial
Purchasers, as applicable, who seeks to sell New Shares or New Bank
Shares, as the case may be, the Company and the Bank, jointly and
severally, shall indemnify and hold harmless each Holder of Transfer
Restricted Securities included within any such Shelf Registration
Statement or Shelf Offering Circular and each participating Broker-Dealer
or the Initial Purchaser selling New Shares or New Bank Shares, and each
person, if any, who controls any such person within the meaning of Section
15 of the Securities Act (each, a "Participant") from and against any
loss, claim, damage or liability, or any action in respect thereof
(including, but not limited to, any loss, claim, damage, liability or
action relating to purchases and sales of securities) to which such
Participant or controlling person may become subject, under the Securities
Act or the rules and regulations of the OTS (including without limitation
12. C.F.R. Section 563g.10) or otherwise, insofar as such loss, claim,
damage, liability or action arises out of, or is based upon, (i) any
untrue statement or alleged untrue statement of a material fact contained
in any such Registration Statement or any Prospectus forming part thereof
or any OTS Offering Circular or in any amendment or supplement thereto or
(ii) 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, and shall reimburse each Participant promptly upon demand
for any legal or other expenses reasonably incurred by such Participant in
connection with investigating or defending or preparing to defend against
any such loss, claim, damage, liability or action as such expenses are
incurred; provided, however, that the Company and Bank shall not be liable
in any such case to the extent that any such loss, claim, damage,
liability or action arises out of, or is based upon, any untrue statement
or alleged untrue statement or omission or alleged omission made in any
such Registration Statement or any Prospectus forming part thereof or any
OTS Offering Circular or in any such amendment or supplement in reliance
upon and in conformity with written information furnished to the Company
and the Bank by or on behalf of any Participant specifically for inclusion
therein and provided further that with respect to any untrue statement or
omission of material fact made in any such Registration Statement or any
Prospectus forming part thereof or any OTS Offering Circular or in any
such amendment or supplement, the indemnity agreement contained in this
Section 8(a) shall not inure to the benefit of any Participant from whom
the person asserting any such loss, claim, damage or liability purchased
the securities concerned, to the extent that any such loss, claim, damage
or liability of such Participant occurs under the circumstance where it
shall have been determined by a court of competent jurisdiction by final
and nonappealable judgment that (w) the Company had previously furnished
copies of an amended or supplemented Prospectus or OTS Offering Circular
correcting such untrue statement or omission to such Participant in
compliance with Section 6(c)(viii), (x) delivery of the amended or
supplemented Prospectus or OTS Offering Circular was required by the
Securities Act or by the applicable rules and regulations of the OTS to be
made to such person, and (y) the amended or supplemented Prospectus or OTS
Offering Circular correcting such untrue statement or omission was not
sent or given to such person at or prior to the written confirmation of
the sale of such securities to such person. The foregoing indemnity
agreement is in addition to any liability which the Company and the Bank
may otherwise have to any Participant or to any controlling person of that
Participant.
(b) Each Participant, severally and not jointly, shall indemnify
and hold harmless the Company and the Bank, each of their respective
directors, officers, employees or agents and each person, if any, who
controls the Company or the Bank within the meaning of Section 15 of the
Securities Act, from and against any loss, claim, damage or liability, or
any action in respect thereof, to which the Company the Bank or any such
director, officer, employee, agent or controlling person may become
subject, under the Securities Act or the rules and regulations of the OTS
(including without limitation 12 C.F.R. Section 563g.10) or otherwise,
insofar as such loss, claim, damage, liability or action arises out of, or
is based upon, (i) any untrue statement or alleged untrue statement of a
material fact contained in any Registration Statement or any Prospectus
forming part thereof or any OTS Offering Circular or in any amendment or
supplement thereto or (ii) 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, but in each case only to the extent
that the untrue statement or alleged untrue statement or omission or
alleged omission was made in reliance upon and in conformity with written
information furnished to the Company and the Bank by or on behalf of that
Participant specifically for inclusion therein, and shall reimburse the
Company and the Bank and any such director, officer, employee, agent or
controlling person for any legal or other expenses reasonably incurred by
the Company or the Bank or any such director, officer, employee, agent or
controlling person in connection with investigating or defending or
preparing to defend against any such loss, claim, damage, liability or
action as such expenses are incurred. The foregoing indemnity agreement
is in addition to any liability which any Participant may otherwise have
to the Company or the Bank or any such director, officer, employee, agent
or controlling person.
(c) Promptly after receipt by an indemnified party under this
Section 8 of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made
against the indemnifying party under this Section 8, notify the
indemnifying party in writing of the claim or the commencement of that
action; provided, however, that the failure to notify the indemnifying
party shall not relieve it from any liability which it may have under this
Section 8 except to the extent it has been materially prejudiced by such
failure and, provided further, that the failure to notify the indemnifying
party shall not relieve it from any liability which it may have to an
indemnified party otherwise than under this Section 8. If any such claim
or action shall be brought against an indemnified party, and it shall have
notified the indemnifying party thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it wishes, jointly
with any other similarly notified indemnifying party, to assume the
defense thereof with counsel satisfactory to the indemnified party. After
notice from the indemnifying party to the indemnified party of its
election to assume the defense of such claim or action, the indemnifying
party shall not be liable to the indemnified party under this Section 8
for any legal or other expenses subsequently incurred by the indemnified
party in connection with the defense thereof other than reasonable costs
of investigation; provided, however, that any indemnified party shall have
the right to employ separate counsel in any such action and to participate
in the defense thereof but the fees and expenses of such counsel shall be
at the expense of such indemnified party unless (i) the employment thereof
has been specifically authorized by the indemnifying party in writing,
(ii) such indemnified party shall have been advised by such counsel that
there may be one or more legal defenses available to it which are
different from or additional to those available to the indemnifying party
and in the reasonable judgment of such counsel it is advisable for such
indemnified party to employ separate counsel or (iii) the indemnifying
party has failed to assume the defense of such action and employ counsel
reasonably satisfactory to the indemnified party, in which case, if such
indemnified party notifies the indemnifying party in writing that it
elects to employ separate counsel at the expense of the indemnifying
party, the indemnifying party shall not have the right to assume the
defense of such action on behalf of such indemnified party, it being
understood, however, that the indemnifying party shall not, in connection
with any one such action or separate but substantially similar or related
actions in the same jurisdiction arising out of the same general
allegations or circumstances, be liable for the reasonable fees and
expenses of more than one separate firm of attorneys at any time for all
such indemnified parties, which firm shall be designated in writing by
Xxxxxx Brothers Inc., if the indemnified parties under this Section 8
consist of any Participant or any of their respective officers, employees
or controlling persons, or by the Company, if the indemnified parties
under this Section 8 consist of the Company or the Bank or any of their
respective directors, officers, employees or controlling persons. No
indemnifying party shall (i) without the prior written consent of the
indemnified parties (which consent shall not be unreasonably withheld),
settle or compromise or consent to the entry of any judgment with respect
to any pending or threatened claim, action, suit or proceeding in respect
of which indemnification or contribution may be sought hereunder (whether
or not the indemnified parties are actual or potential parties to such
claim or action) unless such settlement, compromise or consent includes an
unconditional release of each indemnified party from all liability arising
out of such claim, action, suit or proceeding or (ii) be liable for any
settlement of any such action effected without its written consent (which
consent shall not be unreasonably withheld), but if settled with its
written consent or if there be a final judgment for the plaintiff in any
such action, the indemnifying party agrees to indemnify and hold harmless
any indemnified party from and against any loss or liability by reason of
such settlement or judgment.
(d) If the indemnification provided for in this Section 8 shall
for any reason be unavailable to or insufficient to hold harmless an
indemnified party under Section 8(a) or 8(b) in respect of any loss,
claim, damage or liability, or any action in respect thereof, referred to
therein, then each indemnifying party shall, in lieu of indemnifying such
indemnified party, contribute to the amount paid or payable by such
indemnified party as a result of such loss, claim, damage or liability, or
action in respect thereof, in such proportion as shall be appropriate to
reflect the relative fault of the Company and the Bank on the one hand and
the Participants on the other with respect to the statements or omissions
which resulted in such loss, claim, damage or liability, or action in
respect thereof, as well as any other relevant equitable considerations.
The relative fault shall be determined by reference to whether the untrue
or alleged untrue statement of a material fact or omission or alleged
omission to state a material fact relates to information supplied by the
Company and the Bank, on the one hand, or the Participants on the other,
the intent of the parties and their relative knowledge, access to
information and opportunity to correct or prevent such statement or
omission. The Company, the Bank and the Participants agree that it would
not be just and equitable if contributions pursuant to this Section 8(d)
were to be determined by pro rata allocation (even if the Participants
were treated as one entity for such purpose) or by any other method of
allocation which does not take into account the equitable considerations
referred to herein. The amount paid or payable by an indemnified party as
a result of the loss, claim, damage or liability, or action in respect
thereof, referred to above in this Section 8(d) shall be deemed to
include, for purposes of this Section 8(d), any legal or other expenses
reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 8(d), no Participant shall be required to
contribute any amount in excess of the amount by which the proceeds
received by such Participant from an offering of the Preferred Shares or
Bank Preferred Stock exceeds the amount of any damages which such
Participant has otherwise paid or become liable to pay by reason of any
untrue or alleged untrue statement or omission or alleged omission. 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.
The Participants' obligations to contribute as provided in this Section
8(d) are several and not joint.
9. Rule 144A.
The Company and Bank hereby agree with each Holder, for so long
as any Transfer Restricted Securities remain outstanding, to make
available to any Holder or beneficial owner of Transfer Restricted
Securities in connection with any sale thereof and any prospective
purchaser of such Transfer Restricted Securities from such Holder or
beneficial owner, the information required by Rule 144A(d)(4) under the
Securities Act in order to permit resales of such Transfer Restricted
Securities pursuant to Rule 144A and any corresponding provision of the
rules and regulations of the OTS.
10. Participation in Underwritten Registrations.
No Holder may participate in any Underwritten Registration
hereunder unless such Holder (a) agrees to sell such Holder's Transfer
Restricted Securities on the basis provided in any underwriting
arrangements approved by the Persons entitled hereunder to approve such
arrangements and (b) completes and executes all reasonable questionnaires,
powers of attorney, indemnities, underwriting agreements, lock-up letters,
confidentiality agreements and other documents required under the terms of
such underwriting arrangements.
11. Selection of Underwriters
The Holders of Transfer Restricted Securities covered by the
Shelf Registration Statement and Shelf Offering Circular who desire to do
so may sell such Transfer Restricted Securities in an Underwritten
Offering. In any such Underwritten Offering, the investment banker or
investment bankers and manager or managers that will administer the
offering will be selected by the Holders of a majority in aggregate
liquidation preference of the Transfer Restricted Securities included in
such offering; provided that such investment bankers and managers must be
reasonably satisfactory to the Company and the Bank.
12. Miscellaneous
(a) Automatic Exchange. Upon the occurrence of an Automatic
Exchange, the Company shall have no further obligations under this
Agreement.
(b) Remedies. The Company and Bank agree that monetary damages
(including Liquidated Damages) would not be adequate compensation for any
loss incurred by reason of a breach by either of them of the provisions of
this Agreement and hereby agree to waive the defense in any action for
specific performance that a remedy at law would be adequate.
(c) No Inconsistent Agreements. The Company and the Bank will
not on or after the date of this Agreement enter into any agreement with
respect to their securities that is inconsistent with the rights granted
to the Holders in this Agreement or otherwise conflicts with the
provisions hereof. Neither the Company nor the Bank has previously entered
into any agreement granting any registration rights with respect to its
securities to any Person. The rights granted to the Holders hereunder do
not in any way conflict with and are not inconsistent with the rights
granted to the holders of the Company's or the Bank's securities under any
agreement in effect on the date hereof.
(d) Adjustments Affecting the Securities. The Company and the
Bank will not take any action, or permit any change to occur, with respect
to Preferred Shares or Bank Preferred Stock that would materially and
adversely affect the ability of the Holders to Consummate any Exchange
Offer unless such action or change is required by applicable law.
(e) Amendments and Waivers. The provisions of this Agreement
may not be amended, modified or supplemented, and waivers or consents to
or departures from the provisions hereof may not be given, unless the
Company and the Bank have obtained the written consent of Holders of a
majority of the outstanding liquidation preference of Transfer Restricted
Securities. Notwithstanding the foregoing, a waiver or consent to
departure from the provisions hereof that relates exclusively to the
rights of Holders whose securities are being tendered pursuant to the
Exchange Offer and that does not affect directly or indirectly the rights
of other Holders whose securities are not being tendered pursuant to such
Exchange Offer may be given by the Holders of a majority of the
outstanding liquidation preference of Transfer Restricted Securities being
tendered.
(f) Notices. All notices and other communications provided for
or permitted hereunder shall be made in writing by hand-delivery, first-
class mail (registered or certified, return receipt requested),
telecopier, or air courier guaranteeing overnight delivery:
(i) if to a Holder, at the address of such Holder
maintained by the Transfer Agent ; and
(ii) if to the Company:
Sovereign Bank
0000 Xxxxxxxxx Xxxxxxxxx
Xxxxxxxxxx, XX 00000
Attention: Xxxx X. XxXxxxxx
Telecopier No. 000-000-0000
With a copy to:
Xxxxxx X. Xxxxxxx
Xxxxxxx & Xxx
000 Xxxxx Xxxxx Xxxxxx
Xxxxxxx, XX 00000
Telecopier No. 000-000-0000
All such notices and communications shall be deemed to have been
duly given: at the time delivered by hand, if personally delivered; five
business days after being deposited in the mail, postage prepaid, if
mailed; when receipt acknowledged, if telecopied; and on the next business
day, if timely delivered to an air courier guaranteeing overnight
delivery.
(g) Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors and assigns of each of the
parties, including without limitation and without the need for an express
assignment, subsequent Holders of Transfer Restricted Securities;
provided, however, that this Agreement shall not inure to the benefit of
or be binding upon a successor or assign of a Holder unless and to the
extent such successor or assign acquired Transfer Restricted Securities
from such Holder.
(h) Counterparts. This Agreement may be executed in any number
of counterparts and by the parties hereto in separate counterparts, each
of which when so executed shall be deemed to be an original and all of
which taken together shall constitute one and the same agreement.
(i) Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
(j) Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York.
(k) Severability. In the event that any one or more of the
provisions contained herein, or the application thereof in any
circumstance, is held invalid, illegal or unenforceable, the validity,
legality and enforceability of any such provision in every other respect
and of the remaining provisions contained herein shall not be affected or
impaired thereby.
(l) Entire Agreement. This Agreement together with the other
transaction documents is intended by the parties as a final expression of
their agreement and intended to be a complete and exclusive statement of
the agreement and understanding of the parties hereto in respect of the
subject matter contained herein.
(m) Required Consents. Whenever the consent or approval of
Holders of a specified percentage of Transfer Restricted Securities is
required hereunder, Transfer Restricted Securities held by the Company,
the Bank or their affiliates (as such term is defined in Rule 405 under
the Securities Act) shall not be counted in determining whether such
consent or approval was given by the Holders of such required percentage.
IN WITNESS WHEREOF, the parties have executed this Agreement as
of the date first written above.
SOVEREIGN REAL ESTATE INVESTMENT
TRUST
By: /s/ Sovereign Real Estate
Investment Trust
Name:
Title:
SOVEREIGN BANK
By: /s/ Sovereign Bank
Name:
Title:
Accepted as of the date hereof:
XXXXXX BROTHERS INC.,
as Initial Purchaser
By: /s/ Xxxxxx Brothers, Inc.
Name:
Title:
XXXXXXX XXXXX BARNEY INC.,
as Initial Purchaser
By: /s/ Solomon Xxxxx Xxxxxx Inc.
Name:
Title:
