EXHIBIT 1.2
RFS BANCORP, INC.
REVERE FEDERAL SAVINGS AND LOAN ASSOCIATION
UP TO 590,496 SHARES OF COMMON STOCK
($0.01 Par Value Per Share)
Purchase Price $10.00 Per Share
AGENCY AGREEMENT
November __, 1998
Trident Securities, Inc.
4601 Six Forks Road
Suite 400
Raleigh, North Carolina 27609
Gentlemen:
RFS Bancorp, Inc., a federal corporation (the "Company") and Revere Federal
Savings and Loan Association, Revere, Massachusetts ("Association"), a
federally-chartered, federally-insured savings and loan association, hereby
confirm as of the date hereof their respective agreements with Trident
Securities, Inc., Raleigh, North Carolina ("Trident"), a broker-dealer
registered with the Securities and Exchange Commission (the "SEC") and a member
of the NASD (as defined hereinafter), as follows:
1. Introduction.
The Association is reorganizing into the federal mutual holding company
structure according to the laws of the United States and the regulations issued
thereunder by the Office of Thrift Supervision ("OTS") (collectively the
"Reorganization Regulations"). A Notice of Mutual Holding Company Reorganization
on Form MHC-1, which includes the Association's Plan of Reorganization and Stock
Issuance, as subsequently amended ("Plan"), has been filed with the OTS and all
amendments required to the date hereof have also been filed. Prior to the date
hereof, the Plan has been adopted by the Board of Directors of the Association
(hereinafter referred to as "Directors") and prior to the Closing Date (as
defined hereinafter) the Plan will have been approved by an order of the OTS or
the OTS will have given written notice of its intent not to disapprove the
proposed reorganization; or sixty (60) days shall have passed since the OTS
received the notice and deemed it sufficient and the OTS has not given written
notice that the proposed reorganization is disapproved or extended for an
additional thirty (30) days
the period during which disapproval may be issued. As part of the reorganization
into the mutual holding company structure, the Association will convert to the
capital stock form of organization and become a wholly-owned subsidiary of the
Company, and the Company will issue a majority of its to-be outstanding shares
of common stock to Revere, MHC, a Federal mutual holding company (the "Mutual
Company"), and sell a minority of its common stock to the public. References
herein to the Association shall include the Association in its current mutual
form or post-reorganization stock form as a wholly owned subsidiary of the
Company, as indicated by the context. Each capitalized term not defined herein
shall have the meaning assigned to it in the Registration Statement on Form SB-2
(No. 333-_____) filed by the Company with the Securities and Exchange Commission
("SEC") (said Registration Statement, including the prospectus contained therein
and all supplements and amendments thereto including the Rule 424(b) prospectus
from and after the time it is filed with the SEC, is hereinafter referred to as
the "Registration Statement").
Upon consummation of the reorganization, the Company will have authorized
capital of 6,000,000 shares of capital stock, of which 5,000,000 shares shall be
common stock, $0.01 par value per share ("Common Stock"), and 1,000,000 shares
shall be serial preferred stock. Pursuant to the Plan, the Company is offering
between 379,525 and 513,475 (subject to adjustment to 590,496) shares of common
stock for a purchase price of $10.00 per share ("Purchase Price"), in the
following order of priority: (i) depositors of the Bank whose accounts totaled
$50.00 or more as of ____________, 1996; (ii) the Bank's Employee Stock
Ownership Plan (the "ESOP") (for a total of up to 8.0% of the shares sold in the
Offering); (iii) depositors of the Bank whose accounts totaled $50.00 or more as
of September 30, 1998 ("Supplemental Eligible Account Holders"); (iv) depositors
of the Bank whose accounts totaled $50.00 or more as of ___________6, 1998 (the
"Voting Record Date" and such depositors, "Other Members"); and (v) members of
the general public with preference given to natural persons residing in Revere,
Massachusetts. The offering of shares as described herein is hereinafter
collectively referred to as the "Offering." The transactions contemplated by the
Plan, including the Offering, are hereinafter collectively referred to as the
"Reorganization."
The Company and the Association have been advised by Trident that it
desires to use its best efforts to assist the Company with its sale of the
Common Stock in the Offering. Prior to the execution of this Agreement, the
Company delivered to Trident the Prospectus dated November __, 1998, and all
amendments and supplements thereto, if any, to be used in the Offering, which
contain information with respect to the Company, the Association and the Common
Stock.
2. Representations and Warranties.
A. The Company and the Association jointly and severally represent and
warrant to Trident that:
(a) The Association has filed with the OTS a Notice of Mutual
Holding Company Reorganization on Form MHC-1 and an
Application for Approval of a Minority Stock Issuance by a
Subsidiary Savings Association of a Mutual Holding Company
on Form MHC-2, including exhibits, and any amendment or
amendments thereto (collectively, the "MHC Application").
The prospectus contained in the Registration Statement (the
Prospectus) was approved for use by the OTS on November __,
1998. No order has been issued by the OTS preventing or
suspending the use of the Prospectus and no action by or
before the OTS to revoke such authorization is pending, or,
to the knowledge of the Company or the Association,
threatened. The Plan has been adopted by the Directors. At
the time the Prospectus was approved for use, the Prospectus
complied as to form in all material respects with the
requirements of the OTS and the Reorganization Regulations.
(b) The Company has filed with the SEC the Registration
Statement, including exhibits and an amendment or amendments
thereto, for the registration of the Shares under the
Securities Act of 1933, as amended (the "Securities Act")
and the Regulations promulgated thereunder (the "Securities
Act Regulations"); and such Registration Statement has been
declared effective under the Securities Act and no stop
order has been issued with respect thereto and no
proceedings therefor have been initiated or, to the
Company's knowledge, threatened by the SEC. Except as the
context may otherwise require, such Registration Statement,
as amended or supplemented, on file with the SEC at the time
the Registration Statement became effective, including the
Prospectus as amended by the Rule 424(b) Prospectus,
financial statements, schedules, exhibits and all other
documents filed as part thereof, as amended and
supplemented, is herein called the Registration Statement.
(c) As of the date hereof (i) the Registration Statement
complies with the Securities Act and the Securities Act
Regulations, and (ii) the Registration Statement does 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, in 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 or the Association by or on behalf of Trident
relating to Trident expressly for use in the Registration
Statement or Prospectus.
(d) The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby have
been duly and validly authorized by all necessary actions on
the part of each of the Company and the Association, and
this Agreement is a valid and binding obligation of each of
the Company and the Association, enforceable in accordance
with its terms (except as the enforceability thereof may be
limited by bankruptcy, insolvency, moratorium,
reorganization, conservatorship, receivership or similar
laws relating to or affecting the enforcement of creditors
rights generally or the rights of creditors of insured
financial institutions and their holding companies, the
accounts of whose subsidiaries are insured by the Federal
Deposit Insurance Corporation ("FDIC"), by general equity
principles, regardless of whether such enforceability is
considered in a proceeding in equity or at law, or laws
relating to the safety and soundness of insured depository
institutions and their affiliates, and except to the extent
that the provisions of Sections 8 and 9 hereof may be
unenforceable as against public policy or by applicable law,
including without limitation, Section 23A of the Federal
Reserve Act, 12 U.S.C. Section 371c ( Section 23A )).
(e) No order has been issued by the FDIC, the OTS, the SEC or
any other state regulatory or blue sky authority preventing
or suspending the use of the Prospectus and no action by or
before any such government entity to revoke any approval,
authorization or order of effectiveness related to the
Reorganization is pending or threatened.
(f) The MHC Application complied in all material respects with
the Reorganization Regulations, at the time of the approval
of the MHC Application by the OTS (including any amendments
or supplements thereto) and will so comply until the Closing
Date, unless otherwise expressly permitted in writing by the
OTS.
(g) RP Financial, LC. ("RP Financial"), which prepared the
appraisal of the Association dated _________, 1998, (and
updates, if any), is independent with respect to the Company
and the Association within the meaning of the OTS
Regulations. The Company and the Association believe RP
Financial to be experienced and expert in rendering
appraisals of thrift institutions, and nothing has come to
the attention of the Company or the Association which has
caused them to believe that the appraisal by RP Financial
was not prepared in accordance with the requirements of the
OTS Regulations.
(h) Shatswell, MacLeod & Company, P.C. the firm which certified
the financial statements filed as part of the MHC
Application and Prospectus is, with respect to the Company
and the Association, independent certified public
accountants as required by the Securities Act, the
Securities Act Regulations, Rule 101 of the Rules of Conduct
of the Code of Ethics of the American Institute of Certified
Public Accountants ("AICPA"), the Reorganization Regulations
and Title 12 of the Code of Federal Regulations.
(i) The consolidated financial statements, together with the
related schedules and notes thereto, included in the MHC
Application and which are part of the Prospectus present
fairly the financial
condition, results of operations, retained earnings and cash
flows of the Association at and for the dates indicated and
the periods specified and comply as to form in all material
respects with the applicable accounting requirements of the
Securities Act, the Reorganization Regulations and generally
accepted accounting principles ("GAAP"). The term
"Association" shall include the Association and RFS
Investment Corporation ("Subsidiary"), a first tier
subsidiary, except where the context otherwise indicates.
Said consolidated financial statements have been prepared in
conformity with GAAP applied on a consistent basis during
the periods involved, present fairly in all material
respects the information required to be stated therein and
are consistent with the most recent consolidated financial
statements and other reports filed by the Association with
the OTS and FDIC, except that accounting principles employed
in such filings conform to requirements of such authorities
and not necessarily to GAAP. The other financial,
statistical, and pro forma information and related notes
included in the Prospectus present fairly the information
shown therein on a basis consistent with the audited
consolidated financial statements of the Association
included in the Prospectus, and as to the pro forma
adjustments, the adjustments made therein have been properly
applied on the basis described therein.
(j) Since the respective dates as of which information is given
in the MHC Application and the Prospectus, except as may
otherwise be stated therein: (i) there has not been any
material adverse change in the condition (financial or
otherwise), earnings, capital or properties of the
Association, whether or not arising in the ordinary course
of business; (ii) there has not been any material increase
in the long-term debt of the Association or the Company and
neither the Association nor the Company has issued any
securities or incurred any liability or obligation for
borrowed money other than in the ordinary course of
business; (iii) there have not been any material
transactions entered into by the Company or the Association,
except those transactions entered into in the ordinary
course of business; (iv) the capitalization, liabilities,
earnings, assets, properties and business of the Company and
the Association conform in all material respects to the
descriptions thereof contained in the Prospectus; and (v)
neither the Company nor the Association has any material
liability, contingent or otherwise, except as set forth in
the Prospectus.
(k) The Association is a federally-chartered savings and loan
association in mutual form of organization and in the
Reorganization will convert to the capital stock form of
organization, in both instances duly authorized to conduct
its business and own its property as described in the MHC
Application; the Association has obtained all material
licenses, permits and other governmental authorizations
currently required for the conduct of its business; all such
licenses, permits and governmental authorizations currently
are in full force and effect, and the Association is in all
material respects complying with all material laws, rules,
regulations and orders applicable to the operation of its
businesses; the Association has not received notice of any
proceeding or action relating to the revocation or
modification of any such license, permit or governmental
authorization which, singly or in the aggregate, if subject
to an unfavorable decision, ruling or finding, would
materially and adversely affect the conduct of the business,
the condition, financial or otherwise, or the earnings of
the Association; the Association is in good standing with
the OTS and is duly qualified as a foreign corporation to
transact business and is in good standing in each
jurisdiction in which its ownership of property or leasing
of properties or the conduct of its business requires such
qualification, unless the failure to be so qualified in one
or more of such jurisdictions would not have a material
adverse effect on the condition, financial or otherwise, or
the business, operations or income of the Association. Other
than the stock of the Subsidiary, the Association does not
own equity securities or any equity interest in any other
business enterprise except as described in the Prospectus.
The Subsidiary has been duly organized and is in good
standing under the laws of its jurisdiction of incorporation
with full corporate power and authority to own property and
to conduct business as described in the MHC Application and
all of the outstanding stock of the Subsidiary has been duly
authorized and is fully paid and non-assessable, and such
stock is owned directly or indirectly by the Association,
free and clear of any material liens or encumbrances. Except
as described in the Prospectus, the activities of the
Subsidiary are permitted by the rules, regulations, policies
and practices of the OTS and the FDIC.
(l) The deposit accounts of the Association are insured by the
Savings Association Insurance Fund ("SAIF") as administered
by the FDIC up to the maximum amount allowed under law.
(m) Upon consummation of the Reorganization and the Offering,
(i) the authorized, issued and outstanding equity capital of
the Company and the Association will be as set forth in the
MHC Application and in the Prospectus, and no shares of
Common Stock have been or will be issued and outstanding
prior to the Closing Date; (ii) the Shares will have been
duly and validly authorized for issuance and, when issued
and delivered by the Company pursuant to the Plan against
payment of the consideration calculated as set forth in the
Plan and in the Registration Statement, will be duly and
validly issued, fully paid
and nonassessable; (iii) the issuance of the Shares will not
violate any preemptive rights; and (iv) the terms and
provisions of the Shares will conform in all material
respects to the description thereof contained in the MHC
Application and the Registration Statement; and (v) the
certificates representing the Shares will conform in all
material respects with the requirements of applicable laws
and the Reorganization Regulations. Upon the issuance of the
Shares, good title to the Shares will be transferred from
the Company to the purchasers thereof against payment
therefor, subject to such claims as may be asserted against
the purchasers thereof by third-party claimants.
(n) Neither the Company nor the Association is in violation of
its respective charter or bylaws. The consummation of the
transactions herein contemplated will not (i) conflict with
or constitute a breach of, or default under, the charter or
bylaws of the Company or the Association, or a material
breach of any material contract, lease or other instrument
to which the Company or the Association is a party or in
which the Company or the Association has a beneficial
interest, or any applicable material law, rule, regulation
or order; (ii) violate any material authorization, approval,
judgment, decree, order, statute, rule or regulation
applicable to the Company or the Association; or (iii)
result in the creation of any material lien, charge or
encumbrance upon any property of the Company or the
Association.
(o) The Company has or upon the Closing Date will have all such
power, authority, authorizations, approvals and orders as
may be required to enter into this Agreement, to carry out
the provisions and conditions hereof and to issue and sell
the Shares as provided in the Plan and as described in the
Prospectus, subject to the satisfaction or waiver of the
conditions of the OTS approval of the Reorganization, where
applicable, and except as may be required under the blue sky
laws of the various States referred to in Section 5(i)
hereof.
(p) The Association has good and marketable title to all
properties and assets that are material to the business of
the Association and that are described in the MHC
Application and the Prospectus as owned by it, free and
clear of all liens, except such liens as are described in
the MHC Application and the Prospectus or are not materially
significant to the business of the Association and all of
the leases and subleases material to the business of the
Association under which the Association holds properties,
including those described in the MHC Application and the
Prospectus, are in full force and effect.
(q) The Association is not in violation of any directive from
the FDIC,
the OTS, or any other agency to make any material change in
the method of conducting its business so as to comply in all
material respects with all applicable statutes and
regulations (including, without limitation, regulations,
decisions, directives and orders of the OTS and the FDIC)
and, to the best knowledge of the Association, other than as
described in the MHC Application or the Prospectus there is
no suit, proceeding, charge, formal investigation or action
before or by any court, regulatory authority or governmental
agency or body, domestic or foreign, now pending or
threatened, which could reasonably be expected to materially
and adversely affect the Reorganization, the performance of
this Agreement or the consummation of the transactions
contemplated in the Plan and as described in the MHC
Application or the Prospectus, or which might result in any
material adverse change in the condition, earnings, capital
or properties, of the Association, or which would materially
affect its properties and assets.
(r) The Association has received the opinions of Thacher
Proffitt & Wood with respect to the Federal income tax
consequences of the Reorganization and the opinion of
Shatswell MacLeod & Company, P.C. with respect to the
Massachusetts State income tax consequences of the
Reorganization; all material aspects of said opinions are
accurately summarized in the MHC Application and Prospectus;
and the facts and representations upon which such opinions
are based are truthful, accurate and complete, and neither
the Company nor the Association will take any action
inconsistent therewith.
(s) No default exists, and no event has occurred which with
notice or lapse of time, or both, would constitute a default
on the part of the Company or the Association, in the due
performance and observance by the Company or the Association
of any term, covenant or condition of any indenture,
mortgage, deed of trust, note, bank loan or credit agreement
or any other instrument or agreement to which the Company or
the Association is a party or by which it or its properties
is bound or affected in any respect which, in any such case,
is material to the Company or the Association; and no other
party to any such agreement has instituted or, to the
knowledge of the Company or the Association, threatened any
action or proceeding wherein the Company or the Association
would or might be alleged to be in default thereunder.
(t) Subsequent to the date the MHC Application and Prospectus
are approved by the OTS and prior to the Closing Date,
except as otherwise may be indicated or contemplated in the
MHC Application and Prospectus, the Association will not:
(i) issue any securities or incur any material liability or
obligation, direct or
contingent, for borrowed money, except borrowings from the
same or similar sources indicated in the Prospectus in the
ordinary course of its business, or (ii) enter into any
transaction which is material in light of the business and
properties of the Company or the Association, taken as a
whole, excluding origination, purchase and sale of loans and
other investments made in the ordinary course of its
business.
(u) The Association has filed all federal, state and local tax
returns required to be filed and has made timely payments of
all taxes due and payable with respect to such returns, have
made adequate reserves for accrued tax liability and no
deficiency has been asserted with respect thereto by any
taxing authority.
(v) Neither the Company nor the Association has made any payment
of funds of the Company or the Association as a loan for the
purchase of the Shares.
(w) Neither the Company nor the Association is in violation of
any rule or regulation of the OTS or the FDIC that could
reasonably be expected to result in any enforcement action
against the Company or the Association, or their officers or
directors, that could have a material adverse effect on the
financial condition, operations, businesses, assets or
properties of the Company and the Association, taken as a
whole.
(x) Prior to the Reorganization, the Association was not
authorized to issue shares of capital stock. The Association
has not: (i) placed any securities within the last 18 months
(except for notes to evidence other bank loans and
mortgage-backed securities in the ordinary course of
business); (ii) had any material dealings within the 12
months prior to the date hereof with any member of the NASD,
or any person related to or associated with such member,
other than discussions and meetings relating to the proposed
Offering and routine purchases and sales of securities for
or from its portfolio; (iii) except for the letter agreement
entered into between the Association and Trident dated
December 22, 1997 and attached hereto as Exhibit A, entered
into a material financial or management consulting
agreement, other than in the ordinary course of business,
except as contemplated hereunder; and (iv) engaged any
intermediary between Trident and the Company or the
Association in connection with the Offering of the Shares,
and no person is being compensated in any manner for such
service.
(y) The Company has taken all necessary action to qualify or
register the Shares for offer and sale in the Offering under
the laws of the States wherein such Shares will be offered
where such States require qualification or registration.
(z) Neither the Company nor the Association has relied upon
Trident or Trident's legal or other advisors for any legal,
tax or accounting advice in connection with the
Reorganization or the Offering.
(aa) All contracts and other documents required to be filed as
exhibits to the Registration Statement or the MHC
Application have been filed with the SEC or the OTS or both,
as the case may be. All Sales Information to be used by the
Association in the Offering and required by the
Reorganization Regulations to be filed, has been filed with
and approved for use by the SEC and OTS.
(bb) All of the loans represented as assets of the Association as
of the most recent date for which financial condition data
is included in the Prospectus 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 Company and the
Association, taken as a whole.
(cc) Neither the Company nor the Association has made any payment
of funds of the Company or the Association prohibited by
law, and no funds of the Company or the Association have
been set aside to be used for any payment prohibited by law.
(dd) The Company and the Association are in compliance with all
laws, rules and regulations relating to environmental
protection and neither the Company nor the Association is
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 and the Association, taken as a whole. There are no
actions, suits, regulatory investigations or other
proceedings pending or, to the knowledge of the Company or
the Association, threatened against the Company or the
Association relating to environmental protection. 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
or the Association or, to the knowledge of the Company and
the Association, and except as already disclosed in the
Prospectus, has occurred on, in or at any of the facilities
or properties owned or leased by the Company or the
Association or in which the Company or the Association has a
security interest, except such disposal, release or
discharge which
would not have a material adverse effect on the financial
condition, operations, business, assets or properties of the
Company, the Association or the Subsidiary, taken as a
whole.
(ee) All documents delivered by the Association or the Company or
their representatives in connection with the issuance and
sale of the Common Stock, except for those documents that
were prepared by parties other than the Association, the
Company or their representatives, were, on the dates on
which they were delivered, true, complete and correct.
(ff) The records of account holders, depositors, borrowers and
other members of the Association delivered to Trident by the
Association or its agent for use during the Reorganization
are believed to be reliable and accurate and the Association
is not aware of any inaccuracy in such records. Trident
shall have no liability to any person relating to the
reliability, accuracy or completeness of such records or for
any denial or allocation of a subscription to purchase
Shares to any person based upon such records.
Any certificate signed by an officer of the Company or the Association and
delivered to Trident or its counsel that refers to this Agreement and is
referred to therein as a "representation" or "warranty" shall be deemed to be a
representation and warranty by the Company or the Association to Trident and its
counsel as to the matters covered thereby with the same effect as if such
representation and warranty were set forth herein.
B. Trident represents and warrants as follows:
(a) Trident is registered as a broker-dealer and is in good
standing with the SEC and the NASD.
(b) There is not now pending or to its knowledge threatened
against Trident any action or proceeding before the SEC, the
NASD or any State securities commission concerning its
activities as a broker or dealer.
(c) Each of Trident and its employees, agents and
representatives who shall perform any of the services set
forth herein are duly authorized and empowered, and have all
necessary licenses, approvals and permits to perform such
services and Trident is a registered selling agent in the
jurisdictions in which the Company is relying on such
registration for the sale of the Shares and will remain
registered in such jurisdictions in which the Company and
the Association is relying on such registration with respect
to the sale of the Shares, until the Offering is consummated
or terminated.
(d) In the event that Trident, at the request of the
Association, assembles and manages a selling group of
broker-dealers which are members of the NASD to participate
in the solicitation of purchase orders for Shares under the
Selected Dealers' Agreement, all funds received by Trident
to purchase Shares will be handled in accordance with Rule
15c2-4 under the Securities Exchange Act of 1934, as
amended.
(e) The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby have
been duly and validly authorized by all necessary action on
the part of Trident, and this Agreement is a legal, valid
and binding obligation of Trident, 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 registered broker-dealers accounts of whose may
be protected by the Securities Investor Protection
Corporation 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 Sections 8 and 9 hereof may be unenforceable
as against public policy).
3. Employment of Trident; Sale and Delivery of the Shares.
A. On the basis of the representations and warranties herein but
subject to the terms and conditions set forth in this Section 3, the Company and
the Association hereby employ Trident as its agent to use its best efforts in
assisting the Company with the Company's sale of the Shares in the Subscription
Offering and Community Offering. The employment of Trident hereunder shall
terminate (a) forty-five (45) days after the Subscription Offering and Community
Offering closes, unless the Company and the Association, with the approval of
the OTS, is permitted to extend such period of time, or (b) upon consummation of
the Offering, whichever date shall first occur.
If the Company is unable to sell a minimum of 379,525 Shares (or such
lesser amount as the OTS may permit) within the period herein provided, this
Agreement shall terminate and the Association shall refund promptly to any
persons who have subscribed for any Shares the full amount which it may have
received with interest from such persons; and neither party to this Agreement
shall have any obligation to the other party, except as set forth in Sections 8,
9 and 10 hereof. Appropriate arrangements for placing the funds received from
subscriptions for Shares in special interest-bearing accounts with the
Association until all Shares are sold and paid for were made prior to the
commencement of the Subscription Offering, with provision for prompt refund to
the purchasers as set forth above, or for delivery to the Company if all shares
are sold.
If all conditions precedent to the consummation of the Reorganization are
satisfied, including the sale of all Shares required by the Plan to be sold, the
Company agrees to issue or have issued such Shares and to release for delivery
certificates to subscribers thereof for such
Shares as soon as possible after the Closing Date. Such release for delivery
shall be against payment to the Company by any means authorized pursuant to the
Prospectus, at the offices of Thacher Proffitt & Wood or at such other place as
shall be agreed upon among the parties hereto. The date upon which Trident is
paid the compensation due hereunder is herein called the "Closing Date."
B. Trident shall receive the following compensation for its services
hereunder:
(a) A management fee in the amount of 0.50% of the total amount
of stock sold in the Offering.
(b) A commission equal to two percent (2.0%) of the aggregate
dollar amount of the Shares sold in the Subscription
Offering and the Community Offering (excluding any Shares
sold to the Association's directors, executive officers,
employee benefit plans (including the ESOP), and Associates
(as defined in the Plan) of the Association's directors and
executive officers, and (iii) a commission agreed upon
jointly by Trident and the Association to reflect market
requirements at the time of the stock allocation in a
Syndicated Community Offering. All such fees are to be
payable in same day funds to Trident in Raleigh, North
Carolina, on the Closing Date.
(b) Trident shall be reimbursed for all out-of-pocket expenses
incurred by it or its counsel whether or not the Offering is
completed successfully. Full payment of Trident's allocable
expenses billed to date, including legal fees and reasonable
out-of-pocket expenses, shall be made in same day funds on
the Closing Date or, if the Offering is not completed or is
terminated for any reason, within ten (10) calendar days of
receipt by the Association of the detailed listing from
Trident of its allocable expenses. Trident's out-of- pocket
expenses (in the aggregate) will not exceed $18,000
excluding legal fees. Trident acknowledges receipt of
$10,000 advance payment from the Association which shall be
credited against the total reimbursement due Trident
hereunder.
Notwithstanding the limitations on reimbursement of Trident for allocable
expenses provided in the immediately preceding paragraph, in the event that a
resolicitation or other event causes the Offering to be extended beyond its
original expiration date, Trident and the Association shall negotiate in good
faith an adjustment to the amount of reimbursement payable to Trident for its
reasonable and allocable expenses, including legal fees.
The Company or the Association shall pay all applicable stock issue and
transfer taxes with respect to the sale of the Shares. The Company or the
Association shall pay all expenses of the Offering, including, but not limited
to, their attorneys' fees, NASD filing fees,
filing and registration fees, attorneys' fees relating to any required "blue
sky" or state securities laws research and filings, telephone charges, air
freight, rental equipment, supplies, transfer agent charges, fees relating to
auditing and accounting and costs of printing all documents necessary in
connection with the Offering.
4. Offering.
Subject to the provisions of Section 7 hereof, Trident is assisting
the Company on a best efforts basis in offering a minimum of 379,525 Shares and
a maximum of 513,475 Shares with the possibility of increasing the number of
shares to 590,496, in a Subscription and Community Offering. The Shares are to
be initially offered to the public at the price set forth on the cover page of
the Prospectus and the first page of this Agreement.
5. Further Agreements. The Company and the Association jointly and
severally covenant and agree that:
(a) Subsequent to the respective dates as of which information
is given in the Registration Statement and through and
including the Closing Date, except as otherwise may be
indicated or contemplated therein, neither the Company nor
the Association will issue any securities which will remain
issued at the Closing Date or incur any liability or
obligation, direct or contingent, or borrow money, except
borrowings or liabilities in the ordinary course of
business, or enter into any other transaction not in the
ordinary course of business and consistent with prior
practices, which is material in light of the financial
condition, operations, business, properties or assets of the
Company and the Association, taken as a whole.
(b) The Association will not, at any time before or after the
MHC Application is approved by the OTS, file any amendment
or supplement to such Application without notifying Trident
of its intention to file or prepare an amendment or
supplement to the Application and the Association shall
provide Trident and its counsel with the opportunity to
review such amendment or supplement.
(c) Subject to the right of the Company and the Association to
terminate the Offering at any time in its sole discretion,
the Company and the Association will use their best efforts
to cause the MHC Application to be approved by the OTS and
will immediately upon receipt of any information concerning
the events listed below notify Trident in writing: (i)
approval of the MHC Application; (ii) receipt of any
comments from the OTS or any other governmental entity, with
respect to the MHC Application and Registration Statement,
the Reorganization or the transactions contemplated by this
Agreement; (iii) requests by the OTS, or any other
governmental entity for any amendment or supplement to the
MHC Application and Registration Statement or for additional
information; (iv) issuance by the OTS or any other
governmental entity of any order or other action suspending
the Offering or the use of the MHC Application or the
Prospectus or any other filing of the Association under
the Reorganization Regulations or other applicable law, or
the threat of any such action; or (v) issuance by the OTS or
any state authority of any stop order suspending the
effectiveness of the MHC Application or the Registration
Statement or the initiation or threat of initiation of any
proceedings for that purpose. The Association will make
every reasonable effort to prevent the issuance by the OTS
or any state authority of any such order and, if any such
order shall at any time be issued, to obtain the lifting
thereof at the earliest possible time. The Company or the
Association will provide copies of the foregoing comments,
requests and orders to Trident upon receipt of such items by
the Company or the Association.
(d) The Company or the Association will deliver to Trident and
to its counsel two conformed copies of MHC Application as
originally filed and of each amendment or supplement
thereto. In addition, the Company or the Association will
deliver such additional copies of the foregoing documents to
you as may be required for any NASD filings. Further, the
Company or the Association will deliver to Trident and its
counsel such number of copies of the Prospectus, as amended
or supplemented, as Trident may reasonably request.
(e) The Company and the Association will furnish to Trident,
from time to time during the period when the Prospectus is
required to be delivered under the Securities Exchange Act
of 1934, as amended ("1934 Act"), such number of copies of
such Prospectus (as amended or supplemented) as Trident may
reasonably request for the purposes contemplated by the 1934
Act or the respective applicable rules and regulations
applicable thereunder ("1934 Act Regulations"). The Company
and the Association hereby authorize Trident to use the
Prospectus (as amended or supplemented, if amended or
supplemented) for any lawful manner in connection with the
sale of the Shares by Trident.
(f) The Company and the Association will comply with any and all
terms, conditions, requirements and provisions with respect
to the Reorganization and the transactions contemplated
thereby imposed by the OTS or the Reorganization Regulations
or any other governmental agency, including the terms,
conditions, requirements and provisions contained in the
Reorganization Regulations and the 1934 Act Regulations, to
be complied with prior and subsequent to the Closing Date
and when the Prospectus is required to be delivered, the
Company and the Association will comply, at its own expense,
with all requirements imposed upon it by the OTS, or the
Reorganization Regulations, and by the 1934 Act and the 1934
Act Regulations, in each case as from time to time in force,
in accordance with the provisions thereof and the
Registration Statement.
(g) If, at any time during the period when the Prospectus
relating to the Shares is required to be delivered, any
event relating to or affecting the Company or the
Association shall occur, as a result of which it is
necessary
or appropriate, in the reasonable opinion of counsel for the
Company and the Association or, in your reasonable opinion,
after consultation with Trident s counsel, to amend or
supplement the MHC Application or Prospectus in order to
make the MHC Application or Prospectus not misleading in
light of the circumstances existing at the time it is
delivered to a purchaser, the Association will, at its
expense, forthwith prepare, file with the OTS and furnish to
Trident a reasonable number of copies of an amendment or
amendments of, or a supplement or supplements to, the MHC
Application or Prospectus (in form and substance reasonably
satisfactory to Trident and its counsel after a reasonable
time for review) which will amend or supplement the MHC
Application or Prospectus so that as amended or supplemented
it will not contain any untrue statement of a material fact
or omit to state a material fact necessary in order to make
the statements therein, in light of the circumstances
existing at the time the Prospectus is delivered to a
purchaser, not misleading.
(h) The Company and the Association will take all necessary
actions, in cooperation with Trident, as may be required to
qualify or register the Shares for offer and sale by the
Company under the applicable securities or blue sky laws of
such jurisdictions as Trident may reasonably designate;
provided, however, that the Company shall not be obligated
to qualify as a foreign corporation to do business under the
laws of any such jurisdiction. In each jurisdiction where
any of the Shares shall have been qualified or registered as
above provided, the Company will make and file, subject to
the provisions hereof, such statements and reports in each
fiscal period as are or may be required by the laws of such
jurisdiction.
(i) Neither the Company nor the Association will sell or issue,
contract to sell or otherwise dispose of any shares of, or
securities convertible into or exercisable for, Common Stock
for a period of 90 days after the Closing Date, excluding
transactions related to stock options or other stock based
management compensation plans.
(j) During the period during which the Shares are registered
under the 1934 Act or for three years from the Closing Date,
whichever period is greater, the Company will furnish to its
stockholders as soon as practicable after the end of each
fiscal year an annual report (including consolidated
statements of income, stockholders' equity and cash flow of
the Company as of the end of and for such year, certified by
independent public accountants in accordance with Regulation
S-X under the 1934 Act) and, to each stockholder who so
requests, as soon as practicable after the end of the first
three quarters of the first full fiscal year (beginning with
the fiscal quarter ending after the Closing Date)
consolidated financial information of the Company for such
quarter in reasonable detail. In addition, the Company shall
issue appropriate press releases at the same time or prior
to the time of furnishing such annual and quarterly report
to stockholders of the Company. The Company will deliver
such press releases to Trident promptly after such releases
are issued.
(k) The Company will furnish to you during the period of three
years from the date hereof: (i) as soon as available, a copy
of each report of the Company furnished to or filed with the
SEC under the 1934 Act (including, but not limited to,
reports on Forms 10-KSB, 10-QSB and 8-K and all proxy
statements and annual reports to stockholders), a copy of
each other report of the Company mailed to its stockholders
or filed with any national securities exchange or system on
which any class of securities of the Company is listed or
quoted, each press release and material news items and
articles released by the Company as you may reasonably
request in writing, and (ii) from time to time, such other
nonconfidential information concerning the Company or the
Association as Trident may reasonably request in writing.
(l) At all times subsequent to the date of the Prospectus
through and including the Closing Date (i) the Registration
Statement and the Prospectus will comply with the Securities
Act and the Securities Act Regulations, (ii) the
Registration Statement 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, in light of the circumstances under which they were
made, not misleading, and (iii) the Prospectus will not
contain any untrue statement of a material fact or omit to
state any 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.
This subsection shall not apply to statements or omissions
made in reliance upon and in conformity with written
information furnished to the Company or the Association
relating to Trident by or on behalf of Trident expressly for
use in the Registration Statement.
(m) The Company will notify Trident immediately, and confirm the
notice in writing, (i) when any post-effective amendment to
the Registration Statement becomes effective or any
supplement to the Prospectus has been filed, (ii) of the
issuance by the SEC of any stop order relating to the
Registration Statement or of the initiation or the threat of
any proceedings for that purpose, (ii) of the receipt of any
notice with respect to the suspension of the qualification
of the Shares for offering or sale in any jurisdiction and
(iv) of the receipt of any comments from the staff of the
SEC relating to the Registration Statement. If the SEC
enters a stop order relating to the Registration Statement
at any time, the Company will make every reasonable effort
to obtain the lifting of such order at the earliest possible
moment.
(n) During the time when a prospectus is required to be
delivered under the Securities Act, the Company will comply
with all requirements imposed upon it by the Securities Act
and by the Securities Act Regulations to permit the
continuance of offers and sales of or dealings in the Shares
in accordance with the provisions hereof and the Prospectus.
If during the period when the Prospectus is required to be
delivered in connection with
the offer and sale of the Shares any event relating to or
affecting the Company and the Association, taken as a whole,
shall occur as a result of which it is necessary, in the
reasonable opinion of counsel for Trident, to amend or
supplement the Prospectus in order to make the Prospectus
not false or misleading in light of the circumstances
existing at the time it is delivered to a purchaser of the
Shares, the Company forthwith shall prepare and furnish to
Trident a reasonable number of copies of an amendment or
amendments or of a supplement or supplements to the
Prospectus (in form and substance reasonably satisfactory to
counsel for Trident) which shall amend or supplement the
Prospectus so that, as amended or supplemented, the
Prospectus shall not contain an untrue statement of a
material fact or omit to state a material fact necessary in
order to make the statements therein, in light of the
circumstances existing at the time the Prospectus is
delivered to a purchaser of the Shares, not misleading. The
Company will not file or use any amendment or supplement to
the Registration Statement or the Prospectus unless Trident
has been first furnished a copy or if Trident shall
reasonably object after having been furnished such copy. For
the purposes of this subsection the Company and the
Association shall furnish such information with respect to
themselves as Trident from time to time may reasonably
request.
(o) The Company will use the net proceeds from the sale of the
Shares substantially in the manner set forth in the
Prospectus.
(p) Other than as permitted by the Reorganization Regulations,
Massachusetts law and the laws of any state in which the
Shares are qualified for sale, the Association will not
distribute the Prospectus in connection with the offer and
sale of the Shares.
(q) The Association will file with the OTS such
post-Reorganization reports as may be required pursuant to
the Reorganization Regulations or the OTS approval of the
Reorganization and the Offering of the Shares.
(r) The Company will promptly register the Shares with the SEC
under Section 12(g) of the 1934 Act on or prior to the
Closing Date. The Company shall maintain the effectiveness
of such registration for a minimum period of three (3) years
or for such shorter period as may be required by applicable
law.
(s) The Company or the Association will maintain appropriate
arrangements for depositing all funds received from persons
mailing orders to purchase Shares in the Offering in an
interest-bearing account at the rate described in the
Prospectus or until refunds of such funds have been made to
the persons entitled thereto. The Company will maintain such
records of all funds received as are necessary to permit the
funds of each purchaser to be separately insured by the SAIF
(to the maximum extent allowable) and to enable the Company
to make appropriate refunds of such funds in the event that
such refunds are required to be made.
(t) The Company and the Association will take such actions and
furnish such information as are reasonably requested in
writing by Trident in order for Trident to ensure compliance
with the NASD's "Interpretation on Free Riding and
Withholding."
(u) Prior to the Closing Date, the Company, the Association and
the Subsidiary will conduct their respective businesses in
compliance in all material respects with all applicable
federal and state laws, rules, regulations, decisions,
directives and orders including, all decisions, directives
and orders of the OTS and the FDIC.
(v) The Association will not amend the Plan in any manner that
would materially and adversely affect the sale of the Shares
or the terms of this Agreement without consent of Trident,
which consent shall not unreasonably be withheld, unless
such amendment is required by the OTS.
(w) At the Closing Date, the Company and the Association will
have completed all conditions precedent to the
Reorganization and the offer and sale of the Shares in
accordance with the Plan, the Reorganization Regulations and
all other applicable laws, regulations, decisions and
orders, including all terms, conditions, requirements and
provisions precedent to the Reorganization and Offering
imposed upon Company or the Association by the OTS or any
other regulatory authority other than those which the OTS or
other regulatory authorities waive or expressly permit to be
completed after the Reorganization and Offering.
(x) The Reorganization will have been effected, in all material
respects, according to all applicable statutes, regulations,
decisions and orders; and, except with respect to the filing
of certain post-sale, post-reorganization reports, and
documents in compliance with the OTS's resolutions or
letters of approval, all terms, conditions, requirements and
provisions with respect to the Reorganization imposed by the
OTS, if any, will have been complied with by the Association
in all material respects, or appropriate waivers will have
been obtained, and all material notice and waiting periods
will have been satisfied, waived or elapsed.
(y) The Company will not deliver the Shares until each and every
condition set forth in Section 7 hereof has been satisfied,
unless such condition is waived in writing by Trident.
(z) At the time of the approval of the MHC Application by the
OTS (including any amendment or supplement thereto) and at
all times subsequent thereto until the Closing Date, the MHC
Application will comply as to form in all material respects
with the Reorganization Regulations.
(aa) Pursuant to the Plan, on the Closing Date, the Association
will reorganize into the federal mutual holding company
structure.
(bb) If necessary, the Association shall advise Trident as to the
allocation of deposits, in the case of Eligible Account
Holders, Supplemental Eligible Account Holders and Other
Members (as defined in the Plan), and of the Shares in the
event of an oversubscription and shall provide Trident final
instructions as to the allocation of the Shares in such
event, and such instructions shall be accurate, reliable and
complete. The Company and the Association or its agent
(__________________) shall be responsible for the allocation
of Shares, based on deposits in the case of Eligible and
Supplemental Eligible Account Holders, and in proportion to
the amounts of the subscriptions in the case of Other
Members, in the event of an oversubscription and shall
determine final instructions as to the allocation of the
Shares (Allocation Instructions) in such event. Trident
shall have no liability in respect to the Allocation
Instructions or process, and no liability for or related to
any denial or grant of a subscription in whole or in part.
The Company and the Association shall indemnify and hold
Trident harmless for any liability arising out of such
Allocation Instructions or any records of account holders,
depositors, borrowers and other members of the Association
delivered to Trident by the Company or the Association or
their agents for use during the Offering.
(cc) The Company will use its best efforts to obtain approval for
and maintain quotation of its Shares on the NASDAQ Stock
Market or the American Stock Exchange effective on or prior
to the Closing Date.
6. Payment of Expenses.
Whether or not the Reorganization is consummated, subject to Section
3B, the Company and the Association shall pay the following expenses: (a) all
regulatory filing fees, including but not limited to those payable to the SEC,
OTS, blue sky authorities and the NASD (including fees payable to the NASD for
Trident's filing pursuant to the NASD Corporate Finance Rule), (b) all stock
issue and transfer taxes which may be payable with respect to the sale of the
Shares, (c) attorneys fees of the Company and the Association, (d) attorneys
fees relating to any required blue sky laws research and filings, (e) telephone
charges, (f) air freight, (g) rental equipment, (h) supplies, (i) transfer agent
and registrar fees and expenses, (j) auditing and accounting fees and expenses,
(k) costs of printing and mailing all documents necessary in connection with the
Reorganization, and (l) slide production expenses in connection with any
community investor meetings to be held by Trident.
7. Conditions.
A. Conditions of Trident's Obligations. Except as may be waived by
Trident, the obligations of Trident as provided herein shall be subject to the
accuracy of the representations and warranties contained in Section 2 hereof as
of the date hereof and as of the Closing Date, to the accuracy of the written
statements of officers and directors of the Company and the Association made
pursuant to the provisions hereof, to the performance by the Company and the
Association of its obligations hereunder and to the following conditions:
(a) The Registration Statement shall have been declared
effective by
the SEC not later than 2:00 p.m. on the date of this
Agreement, or with Trident's consent at a later time and
date; and at the Closing Date no order suspending the
effectiveness of the Registration Statement shall have been
issued or proceedings therefor initiated or, to the
knowledge of the Company or the Association, threatened by
any state authority, and no order or other action suspending
the effectiveness of the Registration Statement or the
consummation of the Reorganization shall have been issued or
proceedings therefor initiated or to the knowledge of the
Company or the Association threatened by the SEC or any
state or other governmental authority.
(b) At the Closing Date Trident shall have received the opinion,
dated the Closing Date, addressed to Trident and for its
benefit, of Thacher Proffitt & Wood, special counsel for the
Company and the Association and/or qualified local counsel,
and satisfactory in form and substance to counsel for
Trident to the effect that:
i. Upon consummation of the Reorganization, the
Association will be a federally chartered capital stock savings bank duly
authorized to conduct business and own properties as described in the MHC
Application and the Registration Statement.
ii. The Association is organized and validly existing
as a savings and loan association. The Association is not in violation of its
Charter or Bylaws. The consummation of the Reorganization will not result in any
material violation of the provisions of the charter or bylaws of the Association
or regulation or order of the OTS.
iii. The Association is and upon completion of the
Merger the Company will be duly qualified as foreign corporations to transact
business in each jurisdiction in which their respective ownership of property or
leasing of properties or the conduct of their businesses requires such
qualification, unless the failure to be so qualified in one or more such
jurisdictions would not have a material adverse effect on the condition,
financial or otherwise, or the business, operations, income or prospects of the
Company or the Association. The Subsidiary is a validly existing Massachusetts
corporation with full corporate authority to own properties and, except as
described in the Prospectus, the activities of the Subsidiary are permitted by
the rules, regulations, resolutions and practices of the OTS and any other
federal authorities having jurisdiction over such matters; and all of the
outstanding stock of the Subsidiary has been duly authorized and is validly
issued, fully paid and nonassessable, and to such counsel's knowledge such stock
is owned directly or indirectly by the Association and is free and clear of any
material liens, encumbrances, claims or other restrictions.
iv. Upon completion of the Reorganization the Company
will have authorized the Shares as set forth in the Registration Statement, and
the issuance and sale of the Shares will be duly and validly authorized by all
necessary corporate action on the part of the Company; the Shares, upon receipt
of consideration and issuance in accordance with the terms of the Plan and this
Agreement, will be validly issued, fully paid, nonassessable and, except as
disclosed in the Registration Statement, free of preemptive rights, and good
title thereto shall
be transferred by the Company free and clear of all claims, encumbrances,
security interests and liens created by the Company.
v. The certificates for the Shares are in due and
proper form and comply in all material respects with applicable OTS Regulations.
vi. The issuance and sale of the capital stock of the
Association to the Company have been duly authorized by all necessary corporate
action of the Company and the Association and the Association has received the
approval of the OTS, and such capital stock, upon receipt of payment and
issuance in accordance with the terms of the Plan, will be validly issued, fully
paid and nonassessable and good title thereto shall be transferred by the
Association free and clear of all claims, encumbrances, security interests and
liens created by the Association.
vii. Subject to the satisfaction of the conditions to
the OTS approval of the MHC Application, no further approval, authorization,
consent or other order of any regulatory agency is required in connection with
the execution and delivery of this Agreement, the issuance and sale of the
Shares and the consummation of the Reorganization except as may be required
under the blue sky securities laws of various jurisdictions and the regulations
of the NASD (as to which no opinion need be rendered).
viii. The Association is a member of the Federal Home
Loan Bank of Boston. The Association is an insured depository institution under
the Federal Deposit Insurance Act. No action or proceeding to suspend or revoke
such membership is pending or to such counsel s knowledge, threatened.
ix. Upon consummation of the Reorganization, the
authorized, issued and outstanding capital stock of the Company and the
Association will be as set forth in the MHC Application and the Registration
Statement, and, no shares of common stock, or securities exercisable into or
exchangeable for common stock, have been issued prior to the Closing Date; at
the time of the Reorganization, the Shares issued in the Offering will have been
duly and validly authorized for issuance, and when issued and delivered by the
Company pursuant to the Plan against payment of the consideration calculated as
set forth in the Plan, will be duly and validly issued and fully paid and
nonassessable and at such time, all such capital stock shall be free and clear
of any material mortgage, pledge, lien, encumbrance or claim (legal or
equitable); and the issuance of the Shares is not subject to statutory
preemptive rights.
x. This Agreement has been duly authorized, executed
and delivered by the Company and the Association and is the legal, valid and
binding agreement of the Company and the Association and subject to, as to
enforceability, bankruptcy, insolvency, reorganization, moratorium and other
laws of general applicability relating to or affecting creditors' rights, to
general principles of equity and to laws to the safety and soundness of insured
depository institutions, and except to the extent that the provisions of
Sections 8 and 9 hereof may be unenforceable as against public policy or
applicable law, including but not limited to, Section 23A of the Federal Reserve
Act, as amended.
xi. The OTS has authorized the Reorganization and no
action has been taken, or, to such counsel's knowledge, is pending or threatened
to revoke such authorization.
xii. The Plan has been duly adopted by the required
vote of the Directors and members of the Association and complies in all
material respects with the Reorganization Regulations.
xiii. The MHC Application has been approved under the
Reorganization Regulations and no order suspending the approval has been issued
under the Reorganization Regulations or proceedings therefore initiated or, to
the best of such counsel's knowledge, threatened by the OTS or any state
authority. The Registration Statement has been declared effective by the SEC and
no proceedings are pending before the SEC seeking to revoke or rescind the order
declaring the Registration Statement effective, or to such counsel's knowledge,
are threatened.
xiv. At such time as the MHC Application was approved
and the Registration Statement declared effective (i) the MHC Application and
any amendment or supplement thereto (other than consolidated financial
statements and other financial and statistical data included therein and the
Independent Valuation, as to which no opinion need be rendered), complied as to
form in all material respects with the requirements of the Reorganization
Regulations; (ii) the Registration Statement (other than the consolidated
financial statements and other financial 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 Securities Act and the Securities Act
Regulations, and (iii) to such counsel's knowledge, all documents and exhibits
required to be filed with the MHC Application and the Registration Statement
have been so filed; and the descriptions in the MHC Application and the
Registration Statement of such documents and exhibits are accurate and complete
in all material respects.
xv. The information in the MHC Application and the
Registration Statement, under the captions "REGULATION," "THE REORGANIZATION"
"THE OFFERING," "CERTAIN RESTRICTIONS ON ACQUISITION OF THE BANK," "DIVIDEND
POLICY" and "DESCRIPTION OF CAPITAL STOCK," to the extent that it constitutes
matters of law, summaries of legal matters, or proceedings, or legal
conclusions, fairly present the information called for with respect to such
legal matters.
xvi. There are no legal or governmental proceedings
pending or, to such counsel's knowledge, threatened, individually, in the
aggregate, against the Company or the Association which are required to be
disclosed in the MHC Application and the Registration Statement, other than
those disclosed therein; provided that for this purpose, any litigation or
governmental proceeding is not considered to be "threatened" unless the
potential litigant or governmental authority has manifested to counsel a present
intention to initiate such litigation or proceeding.
xvii. To such counsel's knowledge, there are no
contracts, indentures, mortgages, loan agreements, notes, leases or other
instruments required to be described or referred to in the MHC Application and
the Registration Statement or required to be filed as exhibits thereto other
than those described or referred to therein or filed as exhibits
thereto, and to such counsel's knowledge the descriptions thereof or references
thereto are correct in all material respects.
xviii. No order has been issued by the SEC or the OTS
to suspend the Offering and no action for such purpose has been instituted or
to, such counsel's knowledge, threatened by the SEC or the OTS; no person has
sought to obtain review of the final action of the OTS in approving the
Reorganization.
xix. The Company will not be in violation of its
charter upon consummation of the Reorganization.
xx. The Association is not in violation of any
directive from the OTS or the FDIC to make any material change in the method of
conducting its business, except as described in the MHC Application and
Registration Statement.
xxi. To such counsel s knowledge, the Association has
and upon completion of the Reorganization the Company will have obtained all
licenses, permits and other governmental authorizations required for the conduct
of their businesses as described in the Registration Statement, except where the
failure to obtain such licenses, permits or governmental authorizations would
not have a material adverse effect on the financial condition, operations,
business, properties or assets of the Company and the Association, taken as a
whole; to such counsel's knowledge, all of the leases and subleases material to
the business of the Company and the Association under which the Company or the
Association holds properties are in full force and effect.
xxii. To such counsel's knowledge, the descriptions of
contracts, indentures, mortgages, loan agreements, notes, leases or other
instruments required to be described or referred to in the MHC Application and
the Registration Statement are correct in all material respects and to such
counsel's knowledge, no default exists in the due performance or observance of
any material obligation, agreement, covenant or condition contained in any
contract, indenture, mortgage, loan agreement, note or lease or other instrument
so described or referred to.
xxiii. The execution and delivery of this Agreement and
the consummation of the Reorganization do not conflict with or result in a
breach of the charter or bylaws of the Company or the Association, or, to such
counsel's knowledge, constitute a 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 or the Association 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
or the Association is a party or violate any governmental license or permit or
any law, administrative regulation or order or court order, writ, injunction or
decree (subject to the satisfaction of certain conditions imposed by the OTS in
connection with its approval of the MHC Application), which breach, default,
encumbrance or violation would have a material adverse effect on the financial
condition, operations, business, assets or properties of the Company and the
Association, taken as a whole.
xxiv. To such counsel's knowledge, there has been no
breach of any provision of the Company's or the Association's charter or bylaws,
or breach or default (or the occurrence of any event which, with notice or lapse
of time or both, would constitute a default) by the Company or the Association
under any agreement, contract, indenture, bond, debenture, note, instrument or
obligation to which the Company or the Association is a party or by which any of
them or any of their respective assets or properties may be bound, which breach
or default would have a material adverse effect on the financial condition,
operations, business, assets or properties of the Company and the Association,
taken as a whole.
xxv. In rendering such opinion, such counsel may rely
as to matters of fact, to the extent such counsel deems proper, on certificates
of responsible officers of the Company and the Association and public officials;
provided copies of any such certificates are delivered to Trident together with
the opinion to be rendered hereunder by counsel to the Company and the
Association. Such counsel may assume that any agreement is the valid and binding
obligation of any parties to such agreement other than the Association. Such
opinion may also contain such customary assumptions and qualifications and shall
be governed by the Legal Opinion Accord ("Accord") of the American Bar
Association Section of Business Law (1991).
xxvi. The opinion of Thacher Proffitt & Wood shall
cover matters of federal law; the opinion of qualified local counsel (if any)
shall cover the laws of the State of Massachusetts and shall be in form and
substance satisfactory to Trident and its counsel. For purposes of such
opinions, no proceeding shall be deemed to be pending, no order or stop order
shall be deemed to be issued, and no action shall be deemed to be instituted
unless, in each case, a director or executive officer of the Company or the
Association, or its counsel, shall have received a copy of such proceeding,
order, stop order or action. Such opinion may be limited to statutes,
regulations and judicial interpretations and to facts as they exist as of the
date of such opinions. In rendering such opinion, such counsel need assume no
obligation to revise or supplement it should such statutes, regulations and
judicial interpretations 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 proposed or pending regulations or 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 and the
Association of this Agreement or the issuance of the Shares.
(c) The Letter of Thacher Proffitt & Wood, special counsel for
the Company and the Association, addressed to Trident, dated
the Closing Date and in form and substance satisfactory to
special counsel for Trident to the effect that, nothing has
come to such counsel's attention that would lead it to
believe that, the MHC Application or the Registration
Statement, as amended or supplemented, if amended or
supplemented (except as to financial statements, notes to
financial statements, financial tables and other financial
and statistical data, including the appraisal contained
therein, with respect to which such counsel need express no
opinion), at the time it was approved and at the time any
amendment thereto was approved, contained any untrue
statement
of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the
statements made therein in light of the circumstances under
which they were made not misleading, or that the
Registration Statement, as amended or supplemented, if
amended or supplemented (except as to financial statements,
notes to financial statements, financial tables and other
financial and statistical data contained therein, with
respect to which counsel need express no opinion), as of the
Closing Date, contained any untrue statement of a material
fact or omitted to state a material fact necessary to make
the statements therein, in light of the circumstances under
which they were made, not misleading.
(d) At the Closing Date, Trident shall have received the opinion
of its counsel, Luse Lehman Gorman Pomerenk & Schick, P.C.
dated as of the Closing Date, with respect to such matters
as Trident may reasonably require. Such opinion may rely
upon the opinions of counsel to the Association, and as to
matters of fact, upon certificates of officers and directors
of the Company and the Association delivered pursuant hereto
or as such counsel shall reasonably request.
(e) At the Closing Date, Trident shall receive a certificate of
the Chief Executive Officer and the Chief Financial Officer
of each of the Company and the Association, dated the
Closing Date, to the effect that: (i) they have examined the
Registration Statement and the Registration Statement does
not contain an untrue statement of material fact or omit 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 with respect to the
Company or the Association; (ii) since the respective dates
as of which information is given in the MHC Application and
the Registration Statement, there has been no material
adverse change in the condition, financial or otherwise, or
in the earnings, capital or properties, of the Company and
the Association, whether or not arising in the ordinary
course of business; (iii) the representations and warranties
in Section 2 are true and correct with the same force and
effect as though expressly made at and as of the Closing
Date; (iv) the Company and the Association have complied
with all agreements and satisfied all conditions on their
respective parts to be performed or satisfied at or prior to
the Closing Date under the Agreement and the Plan and will
comply with all obligations under this Agreement and the
Plan to be satisfied by it after the Reorganization; (v) no
stop order revoking or suspending the approval of the MHC
Application has been initiated or to the knowledge of such
officers threatened by the SEC, OTS, or any state authority;
and (vi) no order suspending the Offering, the
Reorganization, or the effectiveness of the Registration
Statement
has been issued by the SEC and no proceedings for that
purpose have been initiated or to the knowledge of such
officers threatened by any state authority or the SEC.
(f) At the Closing Date, Trident shall receive, among other
documents, (i) copies of the letters from the OTS
authorizing the use of the Prospectus, (ii) a copy of the
order of the SEC declaring the Registration Statement
effective; (iii) copies of the certificates from the OTS
evidencing the corporate existence of the Company and the
Association; (iv) copy of the certificate from the FDIC
evidencing the insured status of the Association, and (v) a
copy of the letter from the OTS approving the Association s
Federal Stock Charter.
(g) Prior to and at the Closing Date: (i) in the reasonable
opinion of Trident, there shall have been no material
adverse change in the condition, financial or otherwise, in
the earnings, affairs or prospects of the Company and the
Association from that as of the latest dates as of which
such condition is set forth in the Prospectus, except as
referred to therein; (ii) there shall have been no material
transaction entered into by the Company or the Association
from the latest date as of which the financial condition of
the Company or the Association is set forth in the
Prospectus other than transactions as contemplated by and
disclosed in the Prospectus or transactions specifically
referred to or contemplated therein; (iii) neither the
Company nor the Association has received from the OTS or the
FDIC any direction (oral or written) to make any material
change in the method of conducting their business with which
it has not complied (which direction, if any, shall have
been disclosed to Trident) or which materially and adversely
would affect the business, operations or financial condition
or income of the Company or the Association; (iv) the
Association shall not have been in default (nor shall an
event have occurred which, with notice or lapse of time or
both, would constitute a default) under any provision of any
agreement or instrument relating to any material outstanding
indebtedness; (v) no action, suit or proceedings, at law or
in equity or before or by any federal or state commission,
board or other administrative agency, shall be pending or,
to the knowledge of the Company or the Association,
threatened against the Company or the Association or
affecting any of its properties wherein an unfavorable
decision, ruling or finding would materially and adversely
affect the business, operations, financial condition or
income of the Company or the Association; and (vi) the
Shares shall have been qualified or registered for offering
and sale under the securities or blue sky laws of the
jurisdiction as set forth in the blue sky survey, dated
____________, 1998 of Thacher Proffitt & Wood.
(h) Concurrently with the execution of this Agreement, Trident
shall receive a letter from Shatswell, MacLeod & Company,
P.C., dated the date hereof and addressed to Trident: (i)
confirming that Shatswell, MacLeod & Company, P.C., is a
firm of independent public accountants within the meaning of
Rule 101 of the Code of Professional Conduct of the AICPA
and Title 12 of the Code of Federal Regulations and stating
in effect that in its opinion the consolidated financial
statements of the Association for the years ended September
30, 1997 and 1996 and 1995, as are included in the
Prospectus and covered by their opinion included therein,
comply as to form in all material respects with the
applicable accounting requirements of the OTS and the
published rules and regulations of the OTS under 12 CFR Part
563.c and the applicable requirements of the SEC Regulations
specifically Regulation X, (ii) stating in effect that, on
the basis of certain agreed upon procedures (but not an
examination in accordance with generally accepted auditing
standards) consisting of a reading of the latest available
unaudited interim consolidated financial statements of the
Association prepared by the Association, a reading of the
minutes of the meetings of the Board of Directors and
members of the Association and consultations with officers
of the Association responsible for financial and accounting
matters, nothing came to its attention which caused it to
believe that: (A) during the period from the date of the
latest audited consolidated financial statements included in
the Prospectus to a specified date not more than five
business days prior to the date hereof, there was any
material increase in borrowings by the Association
(increases in borrowings shall not be deemed material if
such increases in total borrowings do not exceed $500,000);
or (B) there was any decrease in consolidated retained
earnings of the Association at the date of such letter from
the amounts shown in the latest audited consolidated
statement of condition included in the Prospectus or there
was any decrease in consolidated net income or net interest
income of the Association for the number of full months
commencing immediately after the period covered by the
latest audited consolidated income statement included in the
Prospectus and ended on the latest month end prior to the
date of the Prospectus or in such letter as compared to the
corresponding period in the preceding year; and (iii)
stating that, in addition to the examination referred to in
its opinion included in the Prospectus and the performance
of the procedures referred to in clause (ii) of this
subsection (h), it has compared with the general accounting
records of the Association, as applicable, which are subject
to the internal controls of the Association's accounting
system and other data prepared by the Association 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).
(i) At the Closing Date, Trident shall receive a letter from
Shatswell, MacLeod & Company, P.C. dated the Closing Date,
addressed to Trident, confirming the statements made by it
in the letter delivered by it pursuant to subsection (h) of
this Section 7, the "specified date" referred to in clause
(ii) (A) thereof to be a date specified in such letter,
which shall not be more than five business days prior to the
Closing Date.
(j) At the Closing Date, Trident shall have received a letter
from RP Financial, dated the Closing Date, confirming its
appraisal. Such appraisal shall be in form and substance
reasonably satisfactory to Trident and shall be consistent
with the terms of the Plan.
(k) At the Closing Date, Trident's counsel shall have been
furnished with such documents and opinions as they may
reasonably require for the purpose of enabling them to pass
upon the sale of the Shares as herein contemplated and
related proceedings or in order to evidence the occurrence
or completeness of any of the representations or warranties,
or the fulfillment of any of the conditions, herein
contained; and all proceedings taken by the Company and the
Association in connection with the Reorganization and the
sale of the Shares as herein contemplated shall be
satisfactory in form and substance to Trident and its
counsel.
(l) The Association shall not have sustained since the date of
the latest audited consolidated financial statements
included in the MHC Application and Registration Statement
any material loss or interference with its business from
fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or
governmental action, order or decree, otherwise than as set
forth or contemplated in the MHC Application and
Registration Statement, and since the respective dates as of
which information is given in the MHC Application and
Registration Statement, there shall not have been any
material change in the consolidated long-term debt of the
Association, or any change, or any development involving a
prospective change, in or affecting the general affairs of
management, financial position, retained earnings, cash flow
or results of operation of the Company or the Association,
otherwise than as set forth or contemplated in the MHC
Application and Registration Statement, the effect of which,
in any such case described above, is in Trident's reasonable
judgment sufficiently material and adverse as to make it
impracticable or inadvisable to proceed with the Offering or
the
delivery of the Shares on the terms and in the manner
contemplated in the Prospectus.
(m) Subsequent to the date hereof, there shall not have occurred
any of the following: (i) a suspension or limitation in
trading in securities generally on the New York Stock
Exchange or American Stock Exchange or in the
over-the-counter market, or quotations halted generally on
NASDAQ, or minimum or maximum prices for trading fixed, or
maximum ranges for prices for securities required by either
of such exchanges or the NASDAQ or by order of the SEC or
any other governmental authority; (ii) a general moratorium
on the operation of commercial banks, federal or state
savings and loan associations or savings banks in
Massachusetts or a general moratorium on the withdrawal of
deposits from commercial banks, federal savings and loan
associations or savings banks in Massachusetts declared by
either federal or Massachusetts authorities; (iii) the
engagement by the United States in hostilities which have
resulted in the declaration, on or after the date hereof, of
a national emergency or war; or (iv) a material decline in
the price of equity or debt securities if the effect of such
a decline, in Trident's reasonable judgment, is sufficiently
material and adverse as to make it impracticable or
inadvisable to proceed with the Offering or the delivery of
the Shares on the terms and in the manner contemplated in
the MHC Application and Prospectus.
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 Association
and delivered to Trident or to counsel for Trident shall be deemed a
representation and warranty by the Company and the Association 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, in
its sole discretion, may terminate this Agreement or, if Trident, in its sole
discretion so elects, may waive any 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 Association shall reimburse
Trident for its allocable expenses as provided in Section 3.B. hereof.
B. Conditions of the Company s and the Association's Obligations.
Except as may be waived by the Company or the Association, the obligations of
the Company and the Association as provided herein shall be subject to the
accuracy of the representations and warranties contained in Section 2.B hereof
as of the date hereof an as of the Closing Date and to the performance by
Trident of its obligations hereunder.
8. Indemnification.
(a) The Company and the Association jointly and severally agree
to indemnify and hold harmless Trident, its officers,
directors and employees and all persons who control Trident
within the meaning of Section 15 of the Securities Act or
Section 20(a) of the 1934 Act, against any and all loss,
liability, claim, damage and expense
whatsoever that such indemnified persons shall suffer and
shall further reimburse promptly such persons for any legal
or other expenses reasonably incurred by each or any of them
investigating, preparing to defend or defending against any
such action, proceeding or claim (whether commenced or
threatened) arising out of or based upon any untrue or
alleged untrue statement of a material fact or the omission
or alleged omission of a material fact required to be stated
or necessary to make the statements in light of the
circumstances under which they were made, not misleading in
(i) the MHC Application, the Registration Statement or (ii)
any application (including the MHC Application) or other
document or communication (in this Section 8 collectively
called "Application") prepared or executed by or on behalf
of the Company or the Association or based upon written
information furnished by or on behalf of the Company or the
Association, filed in any jurisdiction, to effect the
Reorganization or qualify the Shares under the Blue Sky Laws
thereof or filed with the OTS, unless such statement or
omission was made in reliance upon and in conformity with
written information furnished to the Company or the
Association with respect to Trident by or on behalf of
Trident expressly for use in the Registration Statement or
any amendment or supplement thereof or in any Application,
or (iii) any unwritten statement made with the Company's or
the Association's consent to a purchaser of the Shares by
any director or officer or any person employed by or
associated with the Company or the Association other than
Trident, its officers, directors or employees. This
indemnity shall be in addition to any other liability the
Company or the Association may have to Trident.
(b) The Company and the Association shall indemnify and hold
Trident harmless for any liability whatsoever arising out of
(i) the Allocation Instructions or (ii) any records of
Eligible Account Holders, Supplemental Eligible Account
Holders and Other Members (as those terms are defined in the
Plan) delivered to Trident by the Company or the Association
or their agents for use during the Reorganization and the
Offering.
(c) Trident agrees to indemnify and hold harmless the Company
and the Association, their respective officers, directors
and employees and all persons who control the Company and
the Association within the meaning of Section 15 of the
Securities Act or Section 20(a) of the 1934 Act, to the same
extent as the foregoing indemnity from the Company and the
Association to Trident, but only with respect to any
statements or omissions made in the Prospectus or any
amendment or supplement thereof or in any Application in
reliance upon, and in conformity with, information furnished
to the Company or the Association with respect to
Trident by or on behalf of Trident expressly for use in the
Registration Statement or in the Application.
(d) Promptly after receipt by an indemnified party under this
Section 8 of notice of the commencement of any action, such
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 of the commencement thereof,
but the omission to so notify the indemnifying party shall
not relieve the indemnifying party from any liability which
it may have to any indemnified party otherwise than under
this Section 8. In case any such action is brought against
any indemnified party, and it notifies the indemnifying
party of the commencement thereof, the indemnifying party
shall be entitled to participate therein and, to the extent
that it may wish, jointly with the other indemnifying party
similarly notified, to assume the defense thereof, with
counsel satisfactory to such indemnified party, and after
notice from the indemnifying party to such indemnified party
of its election so to assume the defense thereof, the
indemnifying party shall not be liable to such indemnified
party under this Section 8 for any legal or other expenses
subsequently incurred by such indemnified party in
connection with the defense thereof other than the
reasonable cost of investigation except as otherwise
provided herein. In the event the indemnifying party elects
to assume the defense of any such action and retain counsel
acceptable to the indemnified party, the indemnified party
may retain additional counsel, but shall bear the fees and
expenses of such counsel unless (i) the indemnifying party
shall have specifically authorized the indemnified party to
retain such counsel or (ii) the parties to such suit include
such indemnifying party and the indemnified party, and such
indemnified party shall have been advised by counsel that
one or more material legal defenses may be available to the
indemnified party which may not be available to the
indemnifying party, in which case the indemnifying party
shall not be entitled to assume the defense of such suit
notwithstanding the indemnifying party's obligation to bear
the fees and expenses of such counsel. In no event shall the
indemnifying parties be liable for the fees and expenses of
more than one separate firm of attorneys (and any special
counsel that said firm may retain) for all indemnified
parties in connection with any one action, proceeding, claim
or suit or separate but similar or related actions,
proceedings or claims in the same jurisdiction arising out
of the same general allegations or circumstances). An
indemnifying party against who indemnity may be sought shall
not be liable to indemnify an indemnified party under this
Section 8 if any settlement of any such action is effected
without such indemnifying party's consent. To the extent
applicable, this Section 8 is subject to and limited by
public policy
and the provisions of applicable law, including but not
limited to Section 23A.
9. Contribution.
In order to provide for just and equitable contribution in
circumstances in which the indemnity agreement provided for in Section 8 above
is for any reason held to be unavailable to the Company, the Association or
Trident other than in accordance with its terms, the Company, the Association
and Trident shall contribute to the aggregate losses, liabilities, claims,
damages, and expenses of the nature contemplated by said indemnity agreement
incurred by the Company, the Association and Trident (i) in such proportion as
is appropriate to reflect the relative benefits received by the Company and the
Association on the one hand and Trident on the other from the offering of the
Shares 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 Association on the one hand and Trident on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages, liabilities or judgments, as well as any other relevant
equitable considerations. The relative benefits received by the Company and the
Association on the one hand and Trident on the other shall be deemed to be in
the same proportion as the total proceeds from the Reorganization (before
deducting expenses) received by the Company and the Association bear to the
total fees received by Trident under this Agreement. The relative fault of the
Company and the Association on the one hand and Trident on the other shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Company and the
Association or by Trident and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Company, the Association and Trident agree that it would not be just
and equitable if contribution pursuant to this Section 9 were determined by pro
rata allocation or by any other method of allocation which does not take account
of the equitable considerations referred to in the immediately preceding
paragraph. The amount paid or payable by an indemnified party as a result of the
losses, claims, damages, liabilities or judgments referred to in the immediately
preceding paragraph shall be deemed to include, subject to the limitations set
forth above, 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 9, Trident shall not be required
to contribute any amount in excess of the amount by which fees owed Trident
pursuant to this Agreement exceeds the amount of any damages which Trident has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission for which Trident would be provided
indemnification under Section 8 hereof. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who is innocent of such fraudulent
misrepresentation.
10. Survival of Agreements, Representations and Indemnities.
The respective indemnities of the Company, the Association and Trident
and the representations and warranties of the Company and the Association set
forth in or made
pursuant to this Agreement shall remain in full force and effect, regardless of
any termination or cancellation of this Agreement or any investigation made by
or on behalf of Trident or the Company or the Association or any controlling
person or indemnified party referred to in Section 8 hereof, and shall survive
any termination or consummation of this Agreement and/or the issuance of the
Shares, and any legal representative of Trident, the Company, the Association
and any such controlling persons shall be entitled to the benefit of the
respective agreements, indemnities, warranties and representations.
11. Termination.
The Company, the Association or Trident may terminate this Agreement
by giving the notice indicated in subsection (b) below at any time after this
Agreement becomes effective as follows:
(a) If any domestic or international event or act or occurrence has
materially disrupted the United States securities markets such as
to make it, in Trident's reasonable opinion, impracticable to
proceed with the offering of the Shares; or if trading on the New
York Stock Exchange shall have been suspended; or if the United
States shall have become involved in a war or major hostilities;
or if a general banking moratorium has been declared by a state
or federal authority; or if a moratorium in foreign exchange
trading by major international banks or persons has been
declared; or if there shall have been a material adverse change
in the capitalization, condition or business of the Company or
the Association; or if the Company or the Association shall have
sustained a material or substantial loss by fire, flood,
accident, hurricane, earthquake, theft, sabotage or other
calamity or malicious act, whether or not said loss shall have
been insured; or if there shall have been a material adverse
change in condition or prospects of the Company or the
Association.
(b) If any party hereto elects to terminate this Agreement as
provided in this Section, such party shall notify the other
parties hereto promptly by telephone or telegram, confirmed by
letter and delivered by an overnight courier service the same
day.
(c) If this Agreement is terminated for any of the reasons set forth
in subsection (a) above and to fulfill its obligations pursuant
to Sections 3, 6, 8(a) and 9 of this Agreement and upon demand,
the Company or the Association shall pay Trident the full amount
owing thereunder.
12. Notices.
All Communications hereunder, except as herein otherwise specifically
provided, shall be in writing and if sent to Trident shall be mailed, delivered
or telegraphed and confirmed to Trident Securities, Inc., 4601 Six Forks Road,
Suite 400, Raleigh, North Carolina 27609, Attention: Timothy E. Lavelle,
Managing Director (with a copy to Luse Lehman Gorman Pomerenk & Schick, P.C.,
5335 Wisconsin Avenue, N.W., Suite 400 East, Washington, D.C. 20007, Attention:
Robert I. Lipsher, Esquire), or if sent to the Company or the Association, shall
be mailed, delivered or telegraphed and confirmed to the Company or the
Association at 310 Broadway, Revere, Massachusetts 02151, Attention: James J.
McCarthy, President (with a copy to Thacher Proffitt & Wood, 1700 Pennsylvania
Avenue, N.W., Suite 800, Washington D.C. 20006, Attention: Richard A. Schaberg).
13. Governing Law.
This Agreement shall be governed by the laws of the State of North
Carolina unless Federal law shall be deemed to apply.
14. Severability.
Any provision of this Agreement found to be invalid, unenforceable, or
otherwise limited by law or regulation shall not effect the validity or
enforceability of the remaining terms of this Agreement.
15. Miscellaneous.
(a) Time shall be of the essence of this Agreement.
(b) This Agreement is made solely for the benefit of and will be
binding upon the parties hereto and their respective successors
and the controlling persons, directors and officers, and no other
person will have any right or obligation hereunder. The term
"successors" shall not include any purchaser of any of the
Shares.
(c) This Agreement sets forth the entire understanding and agreement
among the parties hereto representing the subject matter hereof
and supersedes and cancels all prior agreements and
understanding, written or oral, including the Letter Agreement
between Trident and the Association dated December 22, 1997.
(d) This Agreement may be signed in various counterparts which
together will constitute one agreement.
If the foregoing correctly sets forth the arrangement among the Company,
the Association and Trident, please indicate acceptance thereof in the spaces
provided below for that purpose, whereupon this letter and your acceptance shall
constitute a binding agreement.
Please acknowledge your agreement to the foregoing by signing below and
returning to the Company and the Association one copy of this letter.
Yours very truly,
REVERE FEDERAL SAVINGS TRIDENT SECURITIES, INC.
AND LOAN ASSOCIATION
By: By:
---------------------------- ----------------------------
James J. McCarthy, President Timothy E. Lavelle, Managing
Director
Agreed to and accepted this __th day of November, 1998.
RFS BANCORP, INC.
(in organization)
By:
----------------------------
James J. McCarthy, President