EXHIBIT 1.2
7,015,000 Shares
(subject to increase up to 8,067,250 Shares
in the event of an oversubscription)
FIRSTFED AMERICA BANCORP, INC.
(a Delaware corporation)
Common Stock
(par value $0.01 per share)
AGENCY AGREEMENT
__________, ▇▇▇▇
▇▇▇▇▇▇▇ ▇'▇▇▇▇▇ & Partners, L.P.
Two World Trade Center, ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
FIRSTFED AMERICA BANCORP, INC., a Delaware corporation (the "Company"), and
First Federal Savings Bank of America, a federally chartered mutual savings bank
(the "Savings Bank"), hereby confirm their agreement with Sandler ▇'▇▇▇▇▇ &
Partners, L.P. ("Sandler ▇'▇▇▇▇▇" or the "Agent") with respect to the offer and
sale by the Company of 7,015,000 shares (subject to increase up to 8,067,250
shares in the event of an oversubscription) of the Company's common stock, par
value $0.01 per share (the "Common Stock"). The shares of Common Stock to be
sold by the Company are hereinafter called the "Securities." In addition, as
described herein, the Company expects to contribute shares of Common Stock in an
amount equal to 8% of the shares of Common Stock sold in the Offerings (as
hereinafter defined) to the First Federal Savings Bank of America Foundation
(the "Foundation"), such shares hereinafter being referred to as the "Foundation
Shares."
The Securities are being offered in accordance with the plan of conversion
(the "Plan") adopted by the Board of Directors of the Savings Bank pursuant to
which the Savings Bank intends to convert from a federally chartered mutual
savings bank to a federally chartered stock savings bank and issue all of its
stock to the Company. Pursuant to the Plan, the Company is offering to certain
of the Savings Bank's depositors and borrowers and to the Savings Bank's
employee stock ownership plan (the "ESOP") rights to subscribe for the
Securities in a subscription offering (the "Subscription Offering"). To
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the extent Securities are not subscribed for in the Subscription Offering, such
Securities may be offered to certain members of the general public, with
preference given to natural persons residing in the Savings Bank's Local
Community (as defined in the Plan) in a direct community offering (the
"Community Offering" and together with the Subscription Offering, as each may be
extended or reopened from time to time, the "Subscription and Community
Offering") to be commenced concurrently with the Subscription Offering. It is
currently anticipated by the Savings Bank and the Company that any Securities
not subscribed for in the Subscription and Community Offering will be offered,
subject to Section 2 hereof, in a syndicated community offering (the "Syndicated
Community Offering"). The Subscription and Community Offering and the
Syndicated Community Offering are hereinafter referred to collectively as the
"Offerings," and the conversion of the Savings Bank from mutual to stock form,
the acquisition of the capital stock of the Savings Bank by the Company and the
Offerings are hereinafter referred to collectively as the "Conversion." It is
acknowledged that the number of Securities to be sold in the Conversion may be
increased or decreased as described in the Prospectus (as hereinafter defined).
If the number of Securities is increased or decreased in accordance with the
Plan, the term "Securities" shall mean such greater or lesser number, where
applicable.
In connection with the Conversion and pursuant to the terms of the Plan as
described in the Prospectus, the Company has established the Foundation.
Immediately following the consummation of the Conversion, subject to the
approval of the establishment of the Foundation by the depositors of the Savings
Bank and compliance with certain conditions as may be imposed by regulatory
authorities, the Company will contribute newly issued shares of Common Stock in
an amount equal to 8% of the Securities sold in the Offering, or between 414,800
and 561,200 shares of Common Stock (subject to increase in certain circumstances
to 646,100 shares).
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-1 (No. 333-______) including a
prospectus for the registration of the Securities and the Foundation Shares
under the Securities Act of 1933, as amended (the "1933 Act"), has filed such
amendments thereto, if any, and such amended prospectuses as may have been
required to the date hereof by the Commission in order to declare such
registration statement effective, and will file such additional amendments
thereto and such amended prospectuses and prospectus supplements as may
hereafter be required. Such registration statement (as amended to date, if
applicable, and as from time to time amended or supplemented hereafter) and the
prospectus constituting a part thereof (including in each case all documents
incorporated or deemed to be incorporated by reference therein, if any, and the
information, if any, deemed to be part thereof pursuant to the rules and
regulations of the Commission under the 1933 Act, as from time to time amended
or supplemented pursuant to the 1933 Act or otherwise (the "1933 Act
Regulations")) are hereinafter referred to as the "Registration Statement" and
the "Prospectus," respectively, except that if any revised prospectus that shall
be used by the Company in connection with the Subscription and Community
Offering or the Syndicated Community Offering which differs from the Prospectus
on file with the Commission at the time the Registration Statement becomes
effective (whether or not such revised prospectus is required to be filed by the
Company pursuant to Rule 424(b) of the 1933 Act
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Regulations), the term "Prospectus" shall refer to such revised prospectus from
and after the time it is first provided to the Agent for such use.
Concurrently with the execution of this Agreement, the Company is
delivering to the Agent copies of the Prospectus of the Company to be used in
the Subscription and Community Offering. Such Prospectus contains information
with respect to the Savings Bank, the Company and the Common Stock.
SECTION 1. REPRESENTATIONS AND WARRANTIES.
(a) The Company and the Savings Bank jointly and severally represent and
warrant to the Agent as of the date hereof as follows:
(i) The Registration Statement has been declared effective by the
Commission, no stop order has been issued with respect thereto and no
proceedings therefor have been initiated or, to the knowledge of the
Company and the Savings Bank, threatened by the Commission. At the time
the Registration Statement became effective and at the Closing Time
referred to in Section 2 hereof, the Registration Statement complied and
will comply in all material respects with the requirements of the 1933 Act
and the 1933 Act Regulations and did not and will not contain an untrue
statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading. The Prospectus, at the date hereof does not and at the Closing
Time referred to in Section 2 hereof will not, include an untrue statement
of a material fact or omit to state a material fact necessary in order to
make the statements therein, in the light of the circumstances under which
they were made, not misleading; provided, however, that the representations
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and warranties in this subsection shall not apply to statements in or
omissions from the Registration Statement or Prospectus made in reliance
upon and in conformity with information with respect to the Agent furnished
to the Company in writing by the Agent expressly for use in the
Registration Statement or Prospectus (the "Agent Information," which the
Company and the Savings Bank acknowledge appears only in the sections
captioned "Market for Common Stock," and "The Conversion -Marketing and
Underwriting Arrangements," and " - Syndicated Community Offering" of the
Prospectus).
(ii) The Company has filed with the Office of Thrift Supervision,
Department of the Treasury (the "OTS") the Company's application for
approval of its acquisition of the Savings Bank (the "Holding Company
Application") on Form H-(e)1-S promulgated under the savings and loan
holding company provisions of the Home Owners' Loan Act (the "HOLA") and
the regulations promulgated thereunder. The Company has received written
notice from the OTS of its approval of the acquisition of the Savings Bank,
such approval remains in full force and effect and no order has been issued
by the OTS suspending or revoking such approval and no proceedings therefor
have been initiated or, to the knowledge of the Company or the Savings
Bank, threatened by the OTS. At the date of such approval, the Holding
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Company Application complied in all material respects with the applicable
provisions of HOLA and the regulations promulgated thereunder.
(iii) Pursuant to the rules and regulations of the OTS governing the
conversion of federally chartered mutual savings banks to stock form (the
"Conversion Regulations"), the Savings Bank has filed with the OTS an
application for conversion on Form AC, and has filed such amendments
thereto and supplementary materials as may have been required to the date
hereof (such application, as amended to date, if applicable, and as from
time to time amended or supplemented hereafter, is hereinafter referred to
as the "Conversion Application"), including copies of the Savings Bank's
Proxy Statement, to be dated on or about ____________ , 1996, relating to
the Conversion (the "Proxy Statement"), and the Prospectus. The OTS has,
by letter dated _____________, 1996, approved the Conversion Application,
such approval remains in full force and effect and no order has been issued
by the OTS suspending or revoking such approval and no proceedings therefor
have been initiated or, to the knowledge of the Company or the Savings
Bank, threatened by the OTS. At the date of such approval and at the
Closing Time referred to in Section 2, the Conversion Application complied
and will comply in all material respects with the applicable provisions of
the Conversion Regulations.
(iv) At the time of their use, the Proxy Statement and any other
proxy solicitation materials will comply in all material respects with the
applicable provisions of the Conversion Regulations and will 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 the light of the
circumstances under which they were made, not misleading. The Savings Bank
will promptly file the Prospectus and any supplemental sales literature
with the OTS. The Prospectus and all supplemental sales literature, as of
the date the Registration Statement became effective and at the Closing
Time referred to in Section 2, complied and will comply in all material
respects with the applicable requirements of the Conversion Regulations
and, at or prior to the time of their first use, will have received all
required authorizations of the OTS for use in final form.
(v) The OTS has not, by order or otherwise, prevented or suspended
the use of the Prospectus or any supplemental sales literature authorized
by the Company or the Savings Bank for use in connection with the
Offerings.
(vi) ▇▇▇▇▇▇ & Company, Inc., which prepared the valuation of the
Savings Bank as part of the Conversion, has advised the Company and the
Savings Bank that it satisfies all requirements for an appraiser set forth
in the Conversion Regulations and any interpretations or guidelines issued
by the OTS with respect thereto.
(vii) KPMG Peat Marwick LLP, the accountants who certified the
financial statements and supporting schedules of the Savings Bank included
in the Registration Statement, have advised the Company and the Savings
Bank that they are
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independent public accountants within the meaning of the Code of Ethics of
the American Institute of Certified Public Accountants; and such
accountants are, with respect to the Company, the Savings Bank and each
subsidiary of the Savings Bank, independent certified public accountants as
required by the 1933 Act and the 1933 Act Regulations.
(viii) The only subsidiaries of the Savings Bank are _________________
(each a "Subsidiary" and collectively the "Subsidiaries").
(ix) The consolidated financial statements and the related notes
thereto included in the Registration Statement and the Prospectus present
fairly the consolidated financial position of the Company, the Savings Bank
and the Subsidiaries as at the dates specified and the results of
operations, retained earnings and cash flows for the periods specified and
comply as to form in all material respects with the applicable accounting
requirements of the 1933 Act Regulations and the Conversion Regulations;
except as otherwise stated in the Registration Statement, said financial
statements have been prepared in conformity with generally accepted
accounting principles applied on a consistent basis; and the supporting
schedules and tables included in the Registration Statement present fairly
the information required to be stated therein.
(x) Since the respective dates as of which information is given in
the Registration Statement and the Prospectus, except as otherwise stated
therein (A) there has been no material adverse change in the financial
condition, results of operations, or business of the Company, the Savings
Bank and the Subsidiaries, taken as a whole, whether or not arising in the
ordinary course of business, and (B) except for transactions specifically
referred to or contemplated in the Prospectus, there have been no
transactions entered into by the Company, the Savings Bank or the
Subsidiaries, other than those in the ordinary course of business and
consistent with past practice, which are material with respect to the
Company, the Savings Bank and the Subsidiaries, taken as a whole.
(xi) The Company has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the State of Delaware
with corporate power and authority to own, lease and operate its properties
and to conduct its business as described in the Prospectus and to enter
into and perform its obligations under this Agreement; the Company is duly
qualified as a foreign corporation to transact business and is in good
standing in the State of Massachusetts and in all other jurisdictions in
which such qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except where the failure to
so qualify would not have a material adverse effect on the financial
condition, results of operations or business of the Company and its
subsidiaries, taken as a whole.
(xii) Upon consummation of the Conversion and the contribution of the
Foundation Shares as described in the Prospectus, the authorized, issued
and
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outstanding capital stock of the Company will be as set forth in the
Prospectus under "Capitalization" (except for subsequent issuances, if any,
pursuant to reservations, agreements or employee benefit plans specified in
the Prospectus); no shares of Common Stock have been or will be issued and
outstanding prior to the Closing Time referred to in Section 2; at the time
of Conversion, the Securities will have been duly 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 stated
on the cover page of the Prospectus, will be duly and validly issued and
fully paid and nonassessable; the terms and provisions of the Common Stock
and the capital stock of the Company conform to all statements relating
thereto contained in the Prospectus; the certificates representing the
shares of Common Stock will conform with the requirements of federal and
Delaware law; and the issuance of the Securities is not subject to
preemptive or other similar rights.
(xiii) The Savings Bank, as of the date hereof, is a federally
chartered savings bank in mutual form and upon consummation of the
Conversion will be a federally chartered savings bank in stock form, in
both instances with full corporate power and authority to own, lease and
operate its properties and to conduct its business as described in the
Prospectus; the Company, the Savings Bank and each Subsidiary has obtained
all licenses, permits and other governmental authorizations required for
the conduct of their respective businesses or required for the conduct of
their respective businesses as contemplated by the Holding Company
Application, except where the failure to obtain such licenses, permits or
other governmental authorizations would not have a material adverse effect
on the financial condition, results of operations or business of the
Company, the Savings Bank or the Subsidiaries; all such licenses, permits
and other governmental authorizations are in full force and effect and the
Company, the Savings Bank and each Subsidiary is in all material respects
in compliance therewith; neither the Company, the Savings Bank nor any
Subsidiary has received notice of any proceeding or action relating to the
revocation or modification of any such license, permit or other
governmental authorization which, singly or in the aggregate, if the
subject of an unfavorable decision, ruling or finding, might have a
material adverse effect on the financial condition, results of operations
or business of the Company, the Savings Bank or the Subsidiaries; and the
Savings Bank is in good standing under the laws of the United States and is
qualified to do business in any jurisdiction in which the failure to so
qualify would have a material adverse effect on the financial condition,
results of operations or business of the Company, the Savings Bank and the
Subsidiaries, taken as a whole.
(xiv) The deposit accounts of the Savings Bank are insured by the
Federal Deposit Insurance Corporation ("FDIC") up to the applicable limits
and, upon consummation of the Conversion, the liquidation account for the
benefit of eligible account holders and supplemental eligible account
holders will be duly established in accordance with the requirements of the
Conversion Regulations.
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(xv) Upon consummation of the Conversion, the authorized, issued and
outstanding capital stock of the Savings Bank is 1,000 shares of common
stock, par value $1.00 per share (the "Savings Bank Common Stock"); no
shares of Savings Bank Common Stock or of any Savings Bank preferred stock
have been or will be issued and outstanding prior to the Closing Time
referred to in Section 2; at the time of Conversion, the Savings Bank
Common Stock will have been duly authorized for issuance and, when issued
and delivered by the Savings Bank pursuant to the Plan against payment of
the consideration calculated as set forth in the Plan and as described in
the Prospectus, will be duly and validly issued and fully paid and
nonassessable, and all such Savings Bank Common Stock will be owned
beneficially and of record by the Company free and clear of any security
interest, mortgage, pledge, lien, encumbrance, claim or equity; the terms
and provisions of the Savings Bank Common Stock conform to all statements
relating thereto contained in the Prospectus; and the issuance of the
Savings Bank Common Stock is not subject to preemptive or similar rights.
(xvi) The Foundation has been duly incorporated and is validly
existing as a non-stock corporation in good standing under the laws of the
State of Delaware with corporate power and authority to own, lease and
operate its properties and to conduct its business as described in the
Prospectus; the Foundation will not be a savings and loan holding company
within the meaning of 12 C.F.R. Section 574.2(q) as a result of the
issuance of shares of Common Stock to it in accordance with the terms of
the Plan and in the amounts as described in the Prospectus; no approvals
are required to establish the Foundation and to contribute the shares of
Common Stock thereto as described in the Prospectus other than those set
forth in the OTS approval of the Conversion Application; except as
specifically disclosed in the Prospectus and the Proxy Statement, there are
no agreements and/or understandings, written or oral, between the Company
and/or the Savings Bank and the Foundation with respect to the control,
directly or indirectly, over the voting or the acquisition or disposition
of the Foundation Shares; at the time of the Conversion, the Foundation
Shares will have been duly authorized for issuance and, when issued and
contributed by the Company pursuant to the Plan, will be duly and validly
issued and fully paid and non-assessable; and the issuance of the
Foundation Shares is not subject to preemptive or similar rights.
(xvii) Each Subsidiary has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, has full corporate power and authority
to own, lease and operate its properties and to conduct its business as
described in the Registration Statement and Prospectus, and is duly
qualified to transact business and is in good standing in each jurisdiction
in which the failure to so qualify would have a material adverse effect on
the financial condition, results of operations or business of the Company,
the Savings Bank and the Subsidiaries, taken as a whole; the activities of
the Subsidiaries are permitted to subsidiaries of a federally chartered
savings bank by the rules, regulations, resolutions and practices of the
OTS; all of the issued and outstanding capital stock of the Subsidiaries
has been duly authorized and validly issued, is fully
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paid and nonassessable and is owned by the Savings Bank, free and clear of
any security interest, mortgage, pledge, lien, encumbrance, claim or
equitable claim.
(xviii) The Company and the Savings Bank have taken all corporate
action necessary for them to execute, deliver and perform this Agreement,
and this Agreement has been duly executed and delivered by, and is the
valid and binding agreement of, the Company and the Savings Bank,
enforceable in accordance with its terms, except as may be limited by
bankruptcy, insolvency or other laws affecting the enforceability of the
rights of creditors generally and judicial limitations on the right of
specific performance and except as the enforceability of indemnification
and contribution provisions may be limited by applicable securities laws.
(xix) Subsequent to the respective dates as of which information is
given in the Registration Statement and the Prospectus and prior to the
Closing Time, except as otherwise may be indicated or contemplated therein,
none of the Company, the Savings Bank or any Subsidiary will have (A)
issued any securities or incurred any liability or obligation, direct or
contingent, for borrowed money, except borrowings in the ordinary course of
business from the same or similar sources indicated in the Prospectus, or
(B) entered into any transaction or series of transactions that is or are
material in light of the business of the Company, the Savings Bank and the
Subsidiaries, taken as a whole, excluding the origination, purchase and
sale of loans or the purchase and sale of investment securities or
mortgage-backed securities in the ordinary course of business.
(xx) No approval of any regulatory or supervisory or other public
authority is required in connection with the execution and delivery of this
Agreement or the issuance of the Securities and the Foundation Shares that
has not been obtained and a copy of which has been delivered to the Agent,
except for the issuance of the federal stock charter by the OTS, and as may
be required under the securities laws of various jurisdictions.
(xxi) Neither the Company, the Savings Bank nor any Subsidiary is in
violation of its charter or bylaws (and the Savings Bank will not be in
violation of its charter or bylaws in stock form upon consummation of the
Conversion); and neither the Company, the Savings Bank nor the Subsidiaries
is in default (nor has any event occurred which, with notice or lapse of
time or both, would constitute a default) in the performance or observance
of any obligation, agreement, covenant or condition contained in any
contract, indenture, mortgage, loan agreement, note, lease or other
instrument to which the Company, the Savings Bank or the Subsidiaries is a
party or by which it or any of them may be bound, or to which any of the
property or assets of the Company, the Savings Bank or the Subsidiaries is
subject, except for such defaults that would not, individually or in the
aggregate, have a material adverse effect on the financial condition,
results of operations or business of the Company, the Savings Bank and the
Subsidiaries, taken as a whole.
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(xxii) The execution, delivery and performance of this Agreement and
the consummation of the transactions contemplated herein do not and will
not conflict with or constitute a breach of, or default under, or result in
the creation or imposition of any lien, charge or encumbrance upon any
property or assets of the Company, the Savings Bank or the Subsidiaries
pursuant to, any contract, indenture, mortgage, loan agreement, note, lease
or other instrument to which the Company, the Savings Bank or any
Subsidiary is a party or by which it or any of them may be bound, or to
which any of the property or assets of the Company, the Savings Bank or any
Subsidiary is subject, except for such defaults that would not,
individually or in the aggregate, have a material adverse effect on the
financial condition, results of operations or business of the Company, the
Savings Bank and the Subsidiaries, taken as whole, nor will such action
result in any violation of the provisions of the charter or bylaws of the
Company, the Savings Bank or the Subsidiaries, or any applicable law,
regulation or administrative or court decree.
(xxiii) No labor dispute with the employees of the Company, the
Savings Bank or any Subsidiary exists or, to the knowledge of the Company
or the Savings Bank, is imminent; and the Company is not aware of any
existing or imminent labor disturbance by the employees of any of its
principal suppliers or contractors that might be expected to result in any
material adverse change in the financial condition, results of operations
or business of the Company, the Savings Bank and the Subsidiaries, taken
as a whole.
(xxiv) Each of the Company, the Savings Bank and each Subsidiary has
good and marketable title to all properties and assets for which ownership
is material to the business of the Company, the Savings Bank or the
Subsidiaries and to those properties and assets described in the Prospectus
as owned by them, free and clear of all liens, charges, encumbrances or
restrictions, except such liens, charges, encumbrances or restrictions as
are described in the Prospectus or are not material in relation to the
business of the Company, the Savings Bank and the Subsidiaries, taken as a
whole; and all of the leases and subleases material to the business of the
Company, the Savings Bank and the Subsidiaries taken as a whole under which
the Company, the Savings Bank and the Subsidiaries hold properties,
including those described in the Prospectus, are valid and binding
agreements of the Company, the Savings Bank or the Subsidiaries,
enforceable in accordance with their terms, subject, as to enforceability,
to bankruptcy, insolvency, reorganization, moratorium and other laws of
general applicability relating to or affecting creditors' rights, and to
general principles of equity.
(xxv) Neither the Company, the Savings Bank nor any Subsidiary is in
violation of any directive from the OTS or the FDIC to make any material
change in the method of conducting their respective businesses; the Savings
Bank and the Subsidiaries have conducted and are conducting their
businesses so as to comply with all applicable statutes, regulations and
administrative and court decrees (including, without limitation, all
regulations, decisions, directives and orders of the OTS or the
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FDIC) except in such respects as would not have a material adverse effect
upon the Company, the Savings Bank and the Subsidiaries taken as a whole.
(xxvi) There is no action, suit or proceeding before or by any court
or government agency or body, domestic or foreign, now pending, or, to the
knowledge of the Company, the Savings Bank, or any Subsidiary, threatened,
against or affecting the Company, the Savings Bank or any Subsidiary (other
than as disclosed in the Registration Statement) which might result in any
material adverse change in the financial condition, results of operations
or business of the Company, the Savings Bank and the Subsidiaries, taken as
a whole, or which might materially and adversely affect the properties or
assets thereof or which might materially and adversely affect the
consummation of the Conversion; all pending legal or governmental
proceedings to which the Company, the Savings Bank or any Subsidiary is a
party or of which any of their respective properties or assets is the
subject that are not described in the Registration Statement, including
ordinary routine litigation incidental to the business, are, in the
aggregate, not material; and there are no contracts or documents of the
Company, the Savings Bank, or any Subsidiary which are required to be filed
as exhibits to the Registration Statement or the Conversion Application
which have not been so filed.
(xxvii) The Savings Bank has obtained opinions of its counsel,
▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, with respect to the legality of the Securities
and the Foundation Shares to be issued and the federal income tax
consequences of the Conversion and the reorganization of the Company as
contemplated by the Holding Company Application, copies of which are filed
as exhibits to the Registration Statement; all material aspects of the
aforesaid opinions that are required to be disclosed are accurately
summarized in the Prospectus; the facts and representations upon which such
opinions are based are truthful, accurate and complete in all material
respects, and neither the Savings Bank nor the Company has taken or will
take any action inconsistent therewith.
(xxviii) The Savings Bank has obtained an opinion of KPMG Peat
Marwick, LLP with respect to the Massachusetts income tax consequences of
the Conversion and the federal income tax consequences of the Foundation,
copies of which are filed as exhibits to the Registration Statement; all
material aspects of the aforesaid opinions that are required to be
disclosed are accurately summarized in the Prospectus; the facts and
representations upon which such opinions are based are truthful, accurate
and complete in all material respects, and neither the Savings Bank nor the
Company has taken or will take any action inconsistent therewith.
(xxix) The Company is not required to be registered under the
Investment Company Act of 1940, as amended.
(xxx) All of the loans represented as assets on the most recent
financial statements or selected financial information of the Savings Bank
included in the Prospectus meet or are exempt from all requirements of
federal, state or local law
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pertaining to lending, including, without limitation, truth in lending
(including the requirements of Regulations 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 result in a
material adverse effect on the financial condition, results of operations
or business of the Company, the Savings Bank and the Subsidiaries, taken as
a whole.
(xxxi) To the best knowledge of the Company and the Savings Bank,
none of the Company, the Savings Bank or any Subsidiary, or any of their
respective employees has made any payment of funds of the Company, the
Savings Bank or any Subsidiary as a loan for the purchase of the Common
Stock or made any other payment of funds prohibited by law, and no funds
have been set aside to be used for any payment prohibited by law.
(xxxii) The Company, the Savings Bank and each Subsidiary is in
compliance in all material respects with the applicable financial
recordkeeping and reporting requirements of the Currency and Foreign
Transaction Reporting Act of 1970, as amended, and the rules and
regulations thereunder.
(xxxiii) Neither the Company, the Savings Bank nor any Subsidiary, or
any properties owned or operated by the Company, the Savings Bank or any
Subsidiary, is in violation of or is liable under any Environmental Law (as
defined below), except for such violations or liabilities that,
individually or in the aggregate, would not have a material adverse effect
on the business, financial condition or results of operations of the
Company, the Savings Bank and the Subsidiaries, taken as a whole. There
are no actions, suits or proceedings, or demands, claims, or notices
(including, without limitation, notices, demand letters or requests for
information from any environmental agency) instituted or pending, or to the
knowledge of the Company or the Savings Bank threatened, relating to the
liability of any property owned or operated by the Company, the Savings
Bank or any Subsidiary thereof, under any Environmental Law. For purposes
of this subsection, the term "Environmental Law" means any federal, state,
local or foreign law, statute, ordinance, rule, regulation, code, license,
permit, authorization, approval, consent, order, judgment, decree,
injunction or agreement with any regulatory authority relating to (i) the
protection, preservation or restoration of the environment (including,
without limitation, air, water, vapor, surface water, groundwater, drinking
water supply, surface soil, subsurface soil, plant and animal life or any
other natural resource), and/or (ii) the use, storage, recycling,
treatment, generation, transportation, processing, handling, labeling,
production, release or disposal of any substance presently listed, defined,
designated or classified as hazardous, toxic, radioactive or dangerous, or
otherwise regulated, whether by type or by quantity, including any material
containing any such substance as a component.
(xxxiv) The Company, the Savings Bank and each Subsidiary has filed
all federal, state and local tax returns required to be filed and has made
timely
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payments of all taxes shown as due and payable in respect of such returns,
and no deficiency has been asserted with respect thereto by any taxing
authority.
(xxxv) The Company has received approval, subject to official notice
of issuance, to have the Securities quoted on the National Market of the
Nasdaq Stock Market, Inc. ("Nasdaq") effective at the Closing Time referred
to in Section 2 hereof.
(b) Any certificate signed by the President and Chief Executive Officer
and/or the Chief Financial Officer of the Company or the Savings Bank and
delivered to either of the Agent or counsel for the Agent shall be deemed a
representation and warranty by the Company or the Savings Bank of each as to the
matters covered thereby.
SECTION 2. APPOINTMENT OF SANDLER ▇'▇▇▇▇▇; SALE AND DELIVERY OF THE
SECURITIES; CLOSING.
On the basis of the representations and warranties herein contained and
subject to the terms and conditions herein set forth, the Company hereby
appoints Sandler ▇'▇▇▇▇▇ as its Agent to consult with and advise the Company,
and to assist the Company in its solicitation of subscriptions and purchase
orders for Securities, in connection with the Company's sale of the Securities
in the Subscription and Community Offering and the Syndicated Community
Offering. On the basis of the representations and warranties herein contained,
and subject to the terms and conditions herein set forth, Sandler ▇'▇▇▇▇▇
accepts such appointment and agrees to use its best efforts to assist the
Company with its solicitation of subscriptions and purchase orders for
Securities in accordance with this Agreement; provided, however, that the Agent
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shall not be obligated to take any action that is inconsistent with any
applicable laws, regulations, decisions or orders. The services to be rendered
by Sandler ▇'▇▇▇▇▇ pursuant to this appointment include the following: (i)
consulting as to the securities marketing implications of any aspect of the Plan
or related corporate documents, (ii) reviewing all offering documents, the
Prospectus, stock order forms and related offering materials (it being
understood that preparation and filing of such documents is the sole
responsibility of the Company and the Savings Bank and their counsel); (iii)
assisting in the design and implementation of a marketing strategy for the
Offerings; (iv) assisting Savings Bank management in scheduling and preparing
for meetings with potential investors and broker-dealers; and (v) providing such
other general advice and assistance as may be requested to promote the
successful completion of the Offerings.
The appointment of the Agent hereunder shall terminate upon the earliest
to occur of (a) forty-five (45) days after the last day of the Subscription and
Community Offering, unless the Company and the Agent agree in writing to extend
such period and the OTS agrees to extend the period of time in which the
Securities may be sold, (b) the receipt and acceptance of subscriptions and
purchase orders for all of the Securities, or (c) the completion of the
Syndicated Community Offering.
If any of the Securities remain available after the expiration of the
Subscription and Community Offering, at the request of the Company and the
Savings Bank, Sandler ▇'▇▇▇▇▇ will seek to form a syndicate of registered
brokers or dealers ("Selected Dealers")
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to assist in the solicitation of purchase orders of such Securities on a best
efforts basis, subject to the terms and conditions set forth in a selected
dealers' agreement (the "Selected Dealers' Agreement"), substantially in the
form set forth in Exhibit A to this Agreement. Sandler ▇'▇▇▇▇▇ will endeavor to
limit the aggregate fees to be paid by the Company and the Savings Bank to
Selected Dealers under any such Selected Dealers' Agreement to an amount
competitive with gross underwriting discounts charged at such time for
underwritings of comparable amounts of stock sold at a comparable price per
share in a similar market environment; provided, however, that the aggregate
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fees payable to Sandler ▇'▇▇▇▇▇ and Selected Dealers shall not exceed 7% of the
aggregate Purchase Price (as defined in the Prospectus) of the Securities sold
by such Selected Dealers. Sandler ▇'▇▇▇▇▇ will endeavor to distribute the
Securities among the Selected Dealers in a fashion that best meets the
distribution objectives of the Company and the Savings Bank and the requirements
of the Plan and applicable law, which may result in limiting the allocation of
stock to certain Selected Dealers. It is understood that in no event shall
Sandler ▇'▇▇▇▇▇ be obligated to act as a selected dealer or to take or purchase
any Securities.
In the event the Company is unable to sell at least the Total Minimum of
Securities, as disclosed on the cover of the Prospectus, within the periods
herein provided, this Agreement shall terminate and the Company shall refund to
any persons who have subscribed for any of the Securities the full amount that
it may have received from them, together with interest as provided in the
Prospectus, and no party to this Agreement shall have any obligation to the
others hereunder, except for the obligations of the Company and the Savings Bank
as set forth in Sections 4, 6(a) and 7 hereof and the obligations of the Agent
as provided in Sections 6(b) and 7 hereof. Appropriate arrangements for placing
the funds received from subscriptions for Securities or other offers to purchase
Securities in special interest-bearing accounts with the Savings Bank until all
Securities are sold and paid for were made prior to the commencement of the
Subscription Offering, with provision for refund to the purchasers as set forth
above, or for delivery to the Company if all Securities are sold.
If at least the Total Minimum of Securities, as disclosed on the cover
of the Prospectus, are sold, the Company agrees to issue or have issued the
Securities sold and to release for delivery certificates for such Securities at
the Closing Time against payment therefor by release of funds from the special
interest-bearing accounts referred to above. The closing shall be held at the
offices of ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇, Washington, D.C., at 10:00 a.m., local
time, or at such other place and time as shall be agreed upon by the parties
hereto, on a business day to be agreed upon by the parties hereto. The Company
shall notify the Agent by telephone, confirmed in writing, when funds shall have
been received for all the Securities. Certificates for Securities shall be
delivered directly to the purchasers thereof in accordance with their
directions. Notwithstanding the foregoing, certificates for Securities purchased
through Selected Dealers shall be made available to the Agent for inspection at
least 48 hours prior to the Closing Time at such office as the Agent shall
designate. The hour and date upon which the Company shall release for delivery
all of the Securities, in accordance with the terms hereof, are herein called
the "Closing Time."
-14-
The Company will pay any stock issue and transfer taxes that may be
payable with respect to the sale of the Securities.
In addition to reimbursement of the expenses specified in Section 4
hereof, the Agent will receive the following compensation for its services
hereunder: 1.56% of the aggregate Purchase Price (as defined in the Prospectus)
of the Securities sold in the Subscription Offering and in the Community
Offering.
With respect to any Securities sold by an NASD member firm (other than
Sandler ▇'▇▇▇▇▇) under the Selected Dealers' Agreement in the Syndicated
Community Offering, the Company shall pay (i) the compensation payable to
Selected Dealers under any Selected Dealers' Agreement, (ii) any sponsoring
dealer's fees, and (iii) a management fee to Sandler ▇'▇▇▇▇▇ of one and one-half
percent (1.50%). Any fees payable to Sandler ▇'▇▇▇▇▇ for Securities sold by
Sandler ▇'▇▇▇▇▇ under any such agreement shall be limited to an aggregate of
1.56% of the aggregate Purchase Price of such Securities.
Notwithstanding the foregoing, no fee shall be payable with respect to
any Securities sold in the Subscription and Community Offering to (i) any
employee benefit plan of the Company or the Savings Bank established for the
benefit of their respective directors, officers or employees or (ii) any
director, officer or employee of the Company or the Savings Bank or any member
of such person's immediate family (which term shall mean parents, spouse,
siblings, children and grandchildren).
If this Agreement is terminated by the Agent in accordance with the
provisions of Section 9(a) hereof or the Conversion is terminated by the Company
or the Savings Bank, no fee shall be payable by the Company or the Savings Bank;
however, Sandler ▇'▇▇▇▇▇ shall be entitled to reimbursement of expenses in
accordance with Section 4 hereof.
All fees payable to the Agent hereunder shall be payable in immediately
available funds at Closing Time, or upon the termination of this Agreement, as
the case may be. In recognition of the long lead times involved in the
conversion process, the Savings Bank agrees to make advance payments to the
Agent in the aggregate amount of $50,000, $25,000 of which has been previously
paid, and the remaining $25,000 of which shall be payable upon execution hereof,
which shall be credited against any fees or expenses payable hereunder.
SECTION 3. COVENANTS OF THE COMPANY AND THE SAVINGS BANK. The Company
and the Savings Bank covenant with the Agent as follows:
(a) The Company and the Savings Bank will prepare and file such amendments
or supplements to the Registration Statement, the Prospectus, the Conversion
Application and the Proxy Statement as may hereafter be required by the 1933 Act
Regulations or the Conversion Regulations or as may hereafter be reasonably
requested by the Agent. Following completion of the Subscription and Community
Offering, in the event of a Syndicated Community Offering, the Company and the
Savings Bank will (i) promptly
-15-
prepare and file with the Commission a post-effective amendment to the
Registration Statement relating to the results of the Subscription and Community
Offering, any additional information with respect to the proposed plan of
distribution and any revised pricing information or (ii) if no such post-
effective amendment is required, file with, or mail for filing to, the
Commission a prospectus or prospectus supplement containing information relating
to the results of the Subscription and Community Offering and pricing
information pursuant to Rule 424(c) of the 1933 Act Regulations, in either case
in a form acceptable to the Agent. The Company and the Savings Bank will notify
the Agent immediately, and confirm the notice in writing, (i) of the
effectiveness of any post-effective amendment to the Registration Statement, the
filing of any supplement to the Prospectus and the filing of any amendment to
the Conversion Application, (ii) of the receipt of any comments from the OTS or
the Commission with respect to the transactions contemplated by this Agreement
or the Plan, (iii) of any request by the Commission or the OTS for any amendment
to the Registration Statement or the Conversion Application or any amendment or
supplement to the Prospectus or for additional information, (iv) of the issuance
by the OTS of any order suspending the Offerings or the use of the Prospectus or
the initiation of any proceedings for that purpose, (v) of the issuance by the
Commission of any stop order suspending the effectiveness of the Registration
Statement or the initiation of any proceedings for that purpose, and (vi) of the
receipt of any notice with respect to the suspension of any qualification of the
Securities for offering or sale in any jurisdiction. The Company and the
Savings Bank will make every reasonable effort to prevent the issuance of any
stop order and, if any stop order is issued, to obtain the lifting thereof at
the earliest possible moment.
(b) The Company and the Savings Bank will give the Agent notice of its
intention to prepare or file any amendment to the Conversion Application or
Registration Statement (including any post-effective amendment) or any amendment
or supplement to the Prospectus (including any revised prospectus that the
Company proposes for use in connection with the Syndicated Community Offering of
the Securities that differs from the prospectus on file at the Commission at the
time the Registration Statement becomes effective, whether or not such revised
prospectus is required to be filed pursuant to Rule 424(b) of the 1933 Act
Regulations), will furnish the Agent with copies of any such amendment or
supplement a reasonable amount of time prior to such proposed filing or use, as
the case may be, and will not file any such amendment or supplement or use any
such prospectus to which the Agent or counsel for the Agent may reasonably
object.
(c) The Company and the Savings Bank will deliver to the Agent as many
signed copies and as many conformed copies of the Conversion Application and the
Registration Statement as originally filed and of each amendment thereto
(including exhibits filed therewith or incorporated by reference therein) as the
Agent may reasonably request, and from time to time such number of copies of
the Prospectus as the Agent may reasonably request.
(d) During the period when the Prospectus is required to be delivered, the
Company and the Savings Bank will comply, at their own expense, with all
requirements imposed upon them by the OTS, by the applicable Conversion
Regulations, as from time to time in force, and by the 1933 Act, the 1933 Act
Regulations, the Securities Exchange
-16-
Act of 1934 (the "1934 Act") and the rules and regulations of the Commission
promulgated thereunder, including, without limitation, Rule 10b-6 under the 1934
Act, so far as necessary to permit the continuance of sales or dealing in shares
of Common Stock during such period in accordance with the provisions hereof and
the Prospectus.
(e) If any event or circumstance shall occur as a result of which it is
necessary, in the opinion of counsel for the Agent, to amend or supplement the
Prospectus in order to make the Prospectus not misleading in the light of the
circumstances existing at the time it is delivered to a purchaser, the Company
and the Savings Bank will forthwith amend or supplement the Prospectus (in form
and substance satisfactory to counsel for the Agent) so that, as so amended or
supplemented, the Prospectus will not include an untrue statement of a material
fact or omit to state a material fact necessary in order to make the statements
therein, in the light of the circumstances existing at the time it is delivered
to a purchaser, not misleading, and the Company and the Savings Bank will
furnish to the Agent a reasonable number of copies of such amendment or
supplement. For the purpose of this subsection, the Company and the Savings
Bank each will furnish such information with respect to itself as the Agent may
from time to time reasonably request.
(f) The Company and the Savings Bank will take all necessary action, in
cooperation with the Agent, to qualify the Securities for offering and sale
under the applicable securities laws of such states of the United States and
other jurisdictions as the Conversion Regulations may require and as the Agent
and the Company have agreed; provided, however, that the Company and the Savings
-------- -------
Bank shall not be obligated to file any general consent to service of process or
to qualify as a foreign corporation in any jurisdiction in which it is not so
qualified. In each jurisdiction in which the Securities have been so qualified,
the Company and the Savings Bank will file such statements and reports as may be
required by the laws of such jurisdiction to continue such qualification in
effect for a period of not less than one year from the effective date of the
Registration Statement.
(g) The Company authorizes Sandler ▇'▇▇▇▇▇ and any Selected Dealers to act
as agent of the Company in distributing the Prospectus to persons entitled to
subscription rights and other persons having record addresses in the states or
jurisdictions set forth in a survey of the securities or "blue sky" laws of the
various jurisdictions in which the Offerings will be made (the "Blue Sky
Survey").
(h) The Company will make generally available to its security holders as
soon as practicable but no later than sixty (60) days from the close of the
period covered thereby an earnings statement (in compliance with the provisions
of Rule 158 of the 1933 Act Regulations) covering a twelve month period
beginning not later than the first day of the Company's fiscal quarter next
following the "effective date" (as defined in said Rule 158) of the Registration
Statement.
(i) During the period ending on the third anniversary of the expiration of
the fiscal year during which the closing of the transactions contemplated hereby
occurs, the Company will furnish to its stockholders as soon as practicable
after the end of each such fiscal year an annual report (including consolidated
statements of financial condition and
-17-
consolidated statements of income, stockholders' equity and cash flows of the
Company, the Savings Bank and the Subsidiaries, certified by independent public
accountants) and, as soon as practicable after the end of each of the first
three quarters of each fiscal year (beginning with the fiscal quarter ending
after the effective date of the Registration Statement), consolidated summary
financial information of the Company, the Savings Bank and the Subsidiaries for
such quarter in reasonable detail. In addition, such annual report and
quarterly consolidated summary financial information shall be made public
through the issuance of appropriate press releases at the same time or prior to
the time of the furnishing thereof to stockholders of the Company.
(j) During the period ending on the third anniversary of the expiration of
the fiscal year during which the closing of the transactions contemplated hereby
occurs, the Company will furnish to the Agent (i) as soon as available, a copy
of each report or other document of the Company furnished generally to
stockholders of the Company or furnished to or filed with the Commission under
the 1934 Act or any national securities exchange or system on which any class of
securities of the Company is listed, and (ii) from time to time, such other
information concerning the Company as the Agent may reasonably request.
(k) The Company and the Savings Bank will conduct the Conversion (including
the formation and operation of the Foundation) in all material respects in
accordance with the Plan, the Conversion Regulations and all other applicable
regulations, decisions and orders thereunder, including all applicable terms,
requirements and conditions precedent to the Conversion imposed upon the Company
or the Savings Bank by the OTS.
(l) Each of the Company and the Savings Bank will use the net proceeds
received by it from the sale of the Securities in the manner specified in the
Prospectus under "Use of Proceeds."
(m) The Company will file with the Commission such reports on Form SR as
may be required pursuant to Rule 463 of the 1933 Act Regulations.
(n) The Company will file a registration statement for the Common Stock
under Section 12(g) of the 1934 Act prior to completion of the Offerings and
will request that such registration statement be effective upon completion of
the Conversion. The Company will maintain the effectiveness of such
registration for not less than three years. The Company will file with the
Nasdaq all documents and notices required by Nasdaq National Market of companies
that have issued securities that are traded in the over-the-counter market and
quotations for which are reported by the Nasdaq National Market.
(o) During the period beginning on the date hereof and ending on the later
of the third anniversary of the Closing Time or the date on which the Agent
receives full payment in satisfaction of any claim for indemnification or
contribution to which it may be entitled pursuant to Sections 6 or 7,
respectively, neither the Company nor the Savings Bank shall, without the prior
written consent of the Agent, which consent shall not be unreasonably withheld,
take or permit to be taken any action that could result in the Savings Bank
common stock becoming subject to any security interest, mortgage, pledge, lien
or
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encumbrance; provided, however, that this covenant shall be null and void if the
-------- -------
Board of Governors of the Federal Reserve System or other Federal agency with
jurisdiction over the Savings Bank, by regulation, policy statement or general
or specific interpretive release or letter permits indemnification of the Agent
by the Savings Bank as contemplated by Section 6(a) hereof.
(p) The Company and the Savings Bank will take such actions and furnish
such information as are reasonably requested by the Agent in order for the Agent
to ensure compliance with the National Association of Securities Dealers, Inc.'s
("NASD") "Interpretation Relating to Free-Riding and Withholding."
(q) The Company and the Savings Bank will comply with the conditions
imposed by or agreed to with the OTS in connection with its approval of the
Holding Company Application and the Conversion Application including those
conditions relating to the establishment and the operation of the Foundation;
the Company and the Savings Bank shall use their best efforts to ensure that the
Foundation submits within the time frames required by applicable law a request
to the Internal Revenue Service to be recognized as a tax-exempt organization
under Section 501(c)(3) of the Internal Revenue Code of 1986, as amended (the
"Code"); the Company and the Savings Bank will take no action which will result
in the possible loss of the Foundation's tax-exempt status; and neither the
Company nor the Savings Bank will contribute any additional assets to the
Foundation until such time that such additional contributions will be deductible
for federal and state income tax purposes.
(r) The Company will not sell or issue, contract to sell or otherwise
dispose of, for a period of 180 days after the Closing Time, without the Agent's
prior written consent, any shares of Common Stock other than the Securities or
the Foundation Shares or other than in connection with any employee benefit plan
or arrangement described in the Prospectus.
SECTION 4. PAYMENT OF EXPENSES. The Company and the Savings Bank jointly
and severally agree to pay all expenses incident to the performance of their
obligations under this Agreement, including but not limited to (i) the cost of
obtaining all securities and bank regulatory approvals, (ii) the printing and
filing of the Registration Statement as originally filed and of each amendment
thereto, (iii) the preparation, issuance and delivery of the certificates for
the Securities to the purchasers in the Offerings, (iv) the fees and
disbursements of the Company's and the Savings Bank's counsel, accountants,
conversion agent and other advisors, (v) the qualification of the Securities
under securities laws in accordance with the provisions of Section 3(f) hereof,
including filing fees and the fees and disbursements of counsel in connection
therewith and in connection with the preparation of the Blue Sky Survey, (vi)
the printing and delivery to the Agent of copies of the Registration Statement
as originally filed and of each amendment thereto and the printing and delivery
of the Prospectus and any amendments or supplements thereto to the purchasers in
the Offerings and the Agent, (vii) the printing and delivery to the Agent of
copies of a Blue Sky Survey and (viii) the fees and expenses incurred in
connection with the listing of the Securities on the Nasdaq National Market. In
the event the Agent incurs any
-19-
such fees and expenses on behalf of the Savings Bank or the Company, the Savings
Bank will reimburse the Agent for such fees and expenses whether or not the
Conversion is consummated; provided, however, that the Agent shall not incur any
-------- -------
substantial expenses on behalf of the Savings Bank or the Company pursuant to
this Section without the prior approval of the Savings Bank.
The Company and the Savings Bank jointly and severally agree to pay
certain expenses incident to the performance of the Agent's obligations under
this Agreement, including (i) the filing fees paid or incurred by the Agent in
connection with all NASD filings and (ii) all reasonable out-of-pocket expenses
incurred by the Agent relating to the Offerings, including, without limitation,
advertising, promotional, syndication and travel expenses and fees and expenses
of the Agent's counsel, up to an aggregate of $75,000. All fees and expenses to
which the Agent is entitled to reimbursement under this paragraph of this
Section 4 shall be due and payable upon receipt by the Company or the Savings
Bank of a written accounting therefor setting forth in reasonable detail the
expenses incurred by the Agent.
SECTION 5. CONDITIONS OF AGENT'S OBLIGATIONS. The Company, the Savings
Bank and the Agent agree that the issuance and sale of the Securities and all
obligations of the Agent hereunder are subject to the accuracy of the
representations and warranties of the Company and the Savings Bank herein
contained as of the date hereof and the Closing Time, to the accuracy of the
statements of officers and directors of the Company and the Savings Bank made
pursuant to the provisions hereof, to the performance by the Company and the
Savings Bank of their obligations hereunder, and to the following further
conditions:
(a) No stop order suspending the effectiveness of the Registration
Statement shall have been issued under the 1933 Act or proceedings therefor
initiated or threatened by the Commission, no order suspending the Offerings or
authorization for final use of the Prospectus shall have been issued or
proceedings therefor initiated or threatened by the OTS and no order suspending
the sale of the Securities in any jurisdiction shall have been issued.
(b) At Closing Time, the Agent shall have received:
(1) The favorable opinion, dated as of Closing Time, of ▇▇▇▇▇▇▇,
▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, counsel for the Company and the Savings Bank, in form
and substance satisfactory to counsel for the Agent, providing that:
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Delaware.
(ii) The Company has full corporate power and authority to own
its properties and to conduct its business as described in the
Registration Statement and Prospectus and to enter into and perform
its obligations under this Agreement.
-20-
(iii) The Company is duly qualified as a foreign corporation
to transact business and is in good standing in the State of
Massachusetts and in each other jurisdiction in which the failure to
so qualify would have a material adverse effect upon the financial
condition, results of operations or business of the Company, the
Savings Bank and the Subsidiaries, taken as a whole.
(iv) Upon consummation of the Conversion and the issuance of
Foundation Shares to the Foundation immediately upon completion
thereof, subject to compliance with all conditions imposed upon the
formation and contribution thereof by the OTS under the terms of any
written notice or order of approval of the Conversion Application or
the Holding Company Application, in an amount as described in the
Prospectus, the authorized, issued and outstanding capital stock of
the Company will be within the range as set forth in the Prospectus
under "Capitalization," and no shares of Common Stock have been issued
and outstanding prior to the Closing Time.
(v) The Securities and the Foundation Shares have been duly
and validly authorized for issuance and sale and, when issued and
delivered by the Company pursuant to the Plan against payment of the
consideration calculated as set forth in the Plan, or contributed by
the Company pursuant to the Plan in the case of the Foundation Shares,
will be duly and validly issued and fully paid and non-assessable.
(vi) The issuance of the Securities and the Foundation Shares
is not subject to preemptive or other similar rights arising by
operation of law or, to the best of such counsel's knowledge and
information, otherwise.
(vii) The Savings Bank has been at all times since the date
hereof and prior to the Closing Time duly organized, and is validly
existing, under the laws of the United States of America as a
federally chartered savings bank of mutual form, and, at the Closing
Time, has become duly organized, validly existing and in good standing
under the laws of the United States of America as a federally
chartered savings bank of stock form, in both instances with full
corporate power and authority to own, lease and operate its properties
and to conduct its business as described in the Registration Statement
and the Prospectus; and the Savings Bank is duly qualified as a
foreign corporation in each jurisdiction in which the failure to so
qualify would have a material adverse effect upon the financial
condition, results of operations or business of the Company, the
Savings Bank and the Subsidiaries, taken as a whole.
(viii) The Savings Bank is a member of the Federal Home Loan
Bank of New York and the deposit accounts of the Savings Bank are
insured by the FDIC up to the applicable limits.
-21-
(ix) Each of the Subsidiaries has been duly incorporated and
is validly existing as a corporation in good standing under the laws
of the state of Massachusetts, has full corporate power and authority
to own, lease and operate its properties and to conduct its business
as described in the Prospectus and is duly qualified as a foreign
corporation to transact business and is in good standing in each
jurisdiction in which the failure to so qualify would have a material
adverse effect upon the financial condition, results of operations or
business of the Company, the Savings Bank and the Subsidiaries, taken
as a whole; the activities of each Subsidiary as described in the
Prospectus are permitted to subsidiaries of a savings and loan holding
company and of a federally chartered savings bank by the rules,
regulations, resolutions and practices of the OTS; all of the issued
and outstanding capital stock of each Subsidiary has been duly
authorized and validly issued, is fully paid and nonassessable and is
owned directly by the Savings Bank free and clear of any security
interest, mortgage, pledge, lien, encumbrance or claim.
(x) The Foundation has been duly incorporated and is validly
existing as a non-stock corporation in good standing under the laws of
the State of Delaware with corporate power and authority to own, lease
and operate its properties and to conduct its business as described in
the Prospectus; the Foundation is not a savings and loan holding
company within the meaning of 12 C.F.R. Section 574.2(q) as a result
of the issuance of shares of Common Stock to it in accordance with the
terms of the Plan and in the amounts as described in the Prospectus;
no approvals are required to establish the Foundation and to
contribute the shares of Common Stock thereto as described in the
Prospectus other than those set forth in any written notice or order
of approval of the Conversion Application or the Holding Company
Application copies of which were provided to the Agent prior to the
Closing Time.
(xi) Upon consummation of the Conversion, all of the issued
and outstanding capital stock of the Savings Bank will be duly
authorized and validly issued and fully paid and nonassessable, and
all such capital stock will be owned of record by the Company free and
clear of any security interest, mortgage, pledge, lien, encumbrance or
legal or equitable claim.
(xii) The OTS has duly approved the Holding Company
Application and the Conversion Application and no action is pending
or, to the best of such counsel's knowledge, threatened respecting the
Holding Company Application or the Conversion Application (including
therewith, the establishment of the Foundation and the contribution of
shares of Common Stock thereto) or the acquisition by the Company of
all of the Savings Bank's issued and outstanding capital stock; the
Holding Company Application and the Conversion Application comply as
to form in all material respects with the Conversion Regulations and
all other applicable requirements of the OTS, and, to best of such
counsel's knowledge, include all documents required to
-22-
be filed as exhibits thereto, and is complete in all material
respects, excluding the Prospectus and any related marketing materials
filed as a part of the Holding Company Application or the Conversion
Application as to which no opinion need be given; the Company is duly
authorized to become a savings and loan holding company and is duly
authorized to own all of the issued and outstanding capital stock of
the Savings Bank to be issued pursuant to the Plan.
(xiii) The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby, including the
establishment of the Foundation and the contribution thereto of the
Foundation Shares, (A) have been duly and validly authorized by all
necessary action on the part of each of the Company and the Savings
Bank, and this Agreement constitutes the legal, valid and binding
agreement of each of the Company and the Savings Bank, enforceable in
accordance with its terms, except as rights to indemnity and
contribution hereunder may be limited under applicable law (it being
understood that such counsel may avail itself of customary exceptions
concerning the effect of bankruptcy, insolvency or similar laws and
the availability of equitable remedies), (B) to the best of such
counsel's knowledge, will not conflict with or constitute a breach of,
or default under, and no event has occurred which, with notice or
lapse of time or both, would constitute a default under, or result in
the creation or imposition of any lien, charge or encumbrance, that,
individually or in the aggregate, would have a material adverse effect
on the financial condition, results of operations or business of the
Company, the Savings Bank and the Subsidiaries, taken as a whole, upon
any property or assets of the Company, the Savings Bank or any
Subsidiary pursuant to any contract, indenture, mortgage, loan
agreement, note, lease or other instrument to which the Company, the
Savings Bank or any Subsidiary is a party or by which any of them may
be bound, or to which any of the property or assets of the Company,
the Savings Bank or any Subsidiary is subject, and (C) will not result
in any violation of the provisions of the charter or bylaws of the
Company, the Savings Bank or any Subsidiary.
(xiv) The Prospectus has been duly authorized by the OTS for
final use pursuant to the Conversion Regulations and no action has
been taken, or is pending or, to the best of such counsel's knowledge,
threatened, by the OTS to revoke such authorization.
(xv) The Registration Statement is effective under the 1933
Act and no stop order suspending the effectiveness of the Registration
Statement has been issued under the 1933 Act or proceedings therefor
initiated or, to the best of such counsel's knowledge, threatened by
the Commission.
(xvi) No further approval, authorization, consent or other
order of any public board or body is required in connection with the
execution and delivery of this Agreement, the issuance of the
Securities and the Foundation
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Shares and the consummation of the Conversion, except as may be
required under the securities or Blue Sky laws of various
jurisdictions as to which no opinion need be rendered.
(xvii) At the time the Registration Statement became effective,
the Registration Statement (other than the financial statements,
appraisal and statistical data included therein, as to which no
opinion need be rendered) complied as to form in all material respects
with the requirements of the 1933 Act and the 1933 Act Regulations.
(xviii) The Common Stock conforms to the description thereof
contained in the Prospectus, and the form of certificate used to
evidence the Common Stock is in due and proper form and complies with
all applicable statutory requirements.
(xix) To the best of such counsel's knowledge, there are no
legal or governmental proceedings pending or threatened against or
affecting the Company, the Savings Bank, any Subsidiary or the
Foundation that are required, individually or in the aggregate, to be
disclosed in the Registration Statement and Prospectus, other than
those disclosed therein, and all pending legal or governmental
proceedings to which the Company, the Savings Bank or the Subsidiaries
is a party or to which any of their property is subject which are not
described in the Registration Statement, including ordinary routine
litigation incidental to the business, are, considered in the
aggregate, not material.
(xx) The information in the Prospectus describing the
liquidation account under the captions "The Conversion - Liquidation
Rights" and "-Effects of Conversion - Effect on Liquidation Rights,"
and the information under "Risk Factors - Establishment of the
Charitable Foundation," " -Recapitalization of SAIF and its Impact on
SAIF Premiums," "Financial Institution Regulation and Possible
Legislation," "- Certain Anti-takeover Provisions Which May Discourage
Takeover Attempts," " - Possible Adverse Income Tax Consequences of
the Distribution of Subscription Rights," "Dividend Policy," "Federal
and State Taxation," "Regulation," "The Conversion," "Restrictions on
Acquisition of the Company and the Bank," "Description of Capital
Stock of the Company" and "Description of Capital Stock of the Bank"
to the extent that it constitutes matters of law, summaries of legal
matters, documents or proceedings, or legal conclusions, is complete
in all material respects.
(xxi) To the best of 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
Registration Statement or to be filed as exhibits thereto other than
those described or referred to therein or filed as exhibits thereto.
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(xxii) The Plan has been duly authorized by the Boards of
Directors of the Company and the Savings Bank and the OTS's approval
of the Plan remains in full force and effect; the Savings Bank's
charter has been amended, effective upon consummation of the
Conversion and the filing of such amended charter with the OTS, to
authorize the issuance of permanent capital stock; to the best of such
counsel's knowledge, the Company and the Savings Bank have conducted
the Conversion and the establishment and the funding of the Foundation
in all material respects in accordance with applicable requirements of
the Plan, the Conversion Regulations and all other applicable
regulations, decisions and orders thereunder, including all material
applicable terms, conditions, requirements and conditions precedent to
the Conversion imposed upon the Company or the Savings Bank by the OTS
and no order, to the best of such counsel's knowledge, has been issued
by the OTS to suspend the Offerings and, no action for such purpose
has been instituted or, to the best of such counsel's knowledge
threatened by the OTS; and, to the best of such counsel's knowledge,
no person has sought to obtain review of the final action of the OTS
in approving the Plan.
(xxiii) To the best of such counsel's knowledge and information,
the Company, the Savings Bank and each Subsidiary has obtained all
licenses, permits and other governmental approvals and authorizations
currently required for the conduct of their respective businesses as
described in the Registration Statement and Prospectus, except for
such licenses, permits, approvals or authorizations the failure of
which to have would not result in a material adverse change in the
financial condition, results of operations or the business of the
Company, the Savings Bank and the Subsidiaries, taken as a whole, and
all such licenses, permits and other governmental authorizations are
in full force and effect, and each of the Company, the Savings Bank
and each Subsidiary is in all material respects complying therewith.
(xxiv) Neither the Company, the Savings Bank nor any Subsidiary
is in violation of its charter upon consummation of the Conversion
nor, to the best of such counsel's knowledge, in default (nor has any
event occurred which, with notice or lapse of time or both, would
constitute a default) in the performance or observance of any
obligation, agreement, covenant or condition contained in any
contract, indenture, mortgage, loan agreement, note, lease or other
instrument to which the Company, the Savings Bank or any Subsidiary is
a party or by which the Company, the Savings Bank or any Subsidiary or
any of their respective property may be bound in any respect that
would have a material adverse effect upon the financial condition,
results of operations or business of the Company, the Savings Bank and
the Subsidiaries, taken as a whole.
(2) The favorable opinion, dated as of Closing Time, of Breyer &
Aguggia, counsel for the Agent, with respect to the matters set forth in
Section 5(b)(1)(i), (iv),
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(v), (vi) (solely as to preemptive rights arising by operation of law),
(xiii)(A), (xvii) and (xviii) and such other matters as the Agent may
reasonably require.
(3) In giving their opinions required by subsections (b)(l) and
(b)(2), respectively, of this Section, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ and
Breyer & Aguggia shall each additionally state that nothing has come to
their attention that would lead them to believe that the Registration
Statement (except for the appraisal, financial statements and schedules and
other financial or statistical data included therein, as to which counsel
need make no statement), at the time it became effective, contained an
untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements therein
not misleading or that the Prospectus (except for the appraisal, financial
statements and schedules and other financial or statistical data included
therein, as to which counsel need make no statement), at the time the
Registration Statement became effective or at Closing Time, included an
untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements therein,
in the light of the circumstances under which they were made, not
misleading. In giving their opinions, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ and
Breyer & Aguggia may rely as to certain matters of fact on certificates of
officers and directors of the Company and the Savings Bank and certificates
of public officials, and as to matters of Massachusetts law and Delaware
law upon the opinions of ___________ and Morris, Nichols, Arsht & ▇▇▇▇▇▇▇,
respectively, which opinions shall be in form and substance satisfactory to
the Agent, and Breyer & Aguggia may also rely as to certain matters on the
opinion of ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇.
(c) At the Closing Time referred to in Section 2, the Company and the
Savings Bank will have completed in all material respects the conditions
precedent to the Conversion in accordance with the Plan, the applicable
Conversion Regulations and all other applicable laws, regulations, decisions and
orders, including all terms, conditions, requirements and provisions precedent
to the Conversion imposed upon the Company or the Savings Bank by the OTS, the
FDIC, or any other regulatory authority other than those that the OTS or the
FDIC permit to be completed after the Conversion.
(d) At Closing Time, there shall not have been, since the date hereof or
since the respective dates as of which information is given in the Registration
Statement and the Prospectus, any material adverse change in the financial
condition, results of operations or business of the Company, the Savings Bank
and the Subsidiaries, taken as a whole, whether or not arising in the ordinary
course of business, and the Agent shall have received a certificate of the
President and Chief Executive Officer of the Company and of the Savings Bank
and the chief financial or chief accounting officer of the Company and of the
Savings Bank, dated as of Closing Time, to the effect that (i) there has been no
such material adverse change, (ii) there shall have been no material transaction
entered into by the Company or the Savings Bank from the latest date as of which
the financial condition of the Company or the Savings Bank is set forth in the
Registration Statement and the Prospectus other than transactions referred to or
contemplated therein and transactions in the ordinary course of business, (iii)
neither the Company nor the Savings Bank shall have received from
-26-
the OTS any direction (oral or written) to make any material change in the
method of conducting its business with which it has not complied (which
direction, if any, shall have been disclosed to the Agent) or which materially
and adversely might affect the financial condition, results of operations or
business of the Company and the Savings Bank taken as a whole, (iv) the
representations and warranties in Section 1 hereof are true and correct with the
same force and effect as though expressly made at and as of the Closing Time,
(v) the Company and the Savings Bank have complied with all agreements and
satisfied all conditions on their part to be performed or satisfied at or prior
to Closing Time, (vi) no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that purpose have
been initiated or threatened by the Commission and (vii) no order suspending the
Offerings or the authorization for final use of the Prospectus has been issued
and no proceedings for that purpose have been initiated or threatened by the OTS
or the FDIC and no person has sought to obtain regulatory or judicial review of
the action of the OTS in approving the Plan in accordance with the Conversion
Regulations.
(e) At the time of the execution of this Agreement, the Agent shall have
received from KPMG Peat Marwick LLP a letter dated such date, in form and
substance satisfactory to the Agent, to the effect that (i) they are independent
certified public accountants with respect to the Company, the Savings Bank and
the Subsidiaries within the meaning of the 1933 Act, the 1933 Act Regulations
and the Conversion Regulations; (ii) it is their opinion that the consolidated
financial statements and supporting schedules included in the Registration
Statement and covered by their opinions therein comply as to form in all
material respects with the applicable accounting requirements of the 1933 Act,
the 1933 Act Regulations and the OTS Regulations; (iii) based upon limited
procedures as agreed upon by the Agent and KPMG Peat Marwick LLP and set forth
in detail in such letter, nothing has come to their attention which causes them
to believe that (A) the unaudited financial statements and supporting schedules
of the Savings Bank and the Subsidiaries included in the Registration Statement
do not comply as to form in all material respects with the applicable accounting
requirements of the 1933 Act, the 1933 Act Regulations and the OTS Regulations
or are not presented in conformity with generally accepted accounting principles
applied on a basis substantially consistent with that of the audited financial
statements included in the Registration Statement and the Prospectus, (B) the
unaudited amounts included under the caption "Recent Developments" in the
Registration Statement do not agree with the amounts set forth in the unaudited
consolidated financial statements as of and for the dates and periods presented
under such caption or such unaudited amounts were not determined on a basis
substantially consistent with that of the audited financial statements included
in the Registration Statement and the Prospectus, (C) at a specified date not
more than five (5) days prior to the date of this Agreement, there has been any
increase in the consolidated long term or short term debt of the Savings Bank
and the Subsidiaries or any decrease in consolidated total assets, allowance for
loan losses, total savings deposits or equity of the Savings Bank and the
Subsidiaries, in each case as compared with the amounts shown in the December
31, 1995 balance sheet included in the Registration Statement or, (D) during the
period from December 31, 1995 to a specified date not more than five days prior
to the date of this Agreement, there were any decreases, as compared with the
corresponding period in the preceding year, in net interest income, net interest
income after provision for loan losses, or net income of the Savings Bank and
-27-
the Subsidiaries, except in all instances for increases or decreases that the
Registration Statement and the Prospectus disclose have occurred or may occur;
and (iv) in addition to the examination referred to in their opinions and the
limited procedures referred to in clause (iii) above, they have carried out
certain specified procedures, not constituting an audit, with respect to certain
amounts, percentages and financial information that are included in the
Registration Statement and Prospectus and that are specified by the Agent, and
have found such amounts, percentages and financial information to be in
agreement with the relevant accounting, financial and other records of the
Company, the Savings Bank and the Subsidiaries identified in such letter.
(f) At Closing Time, the Agent shall have received from KPMG Peat Marwick
LLP a letter, dated as of Closing Time, to the effect that they reaffirm their
statements made in the letter furnished pursuant to subsection (e) of this
Section, except that the specified date referred to shall be a date not more
than five days prior to Closing Time.
(g) At Closing Time, the Securities shall have been approved for listing on
the Nasdaq National Market upon notice of issuance.
(h) At Closing Time, the Agent shall have received a letter from ▇▇▇▇▇▇ &
Company, Inc., dated as of the Closing Time, confirming its appraisal.
(i) At Closing Time, counsel for the Agent shall have been furnished with
such documents and opinions as they may require for the purpose of enabling them
to pass upon the issuance and sale of the Securities and the Foundation Shares
as herein contemplated and related proceedings, or in order to evidence the
accuracy of any of the representations or warranties, or the fulfillment of any
of the conditions, herein contained; and all proceedings taken by the Company in
connection with the issuance and sale of the Securities and the Foundation
Shares as herein contemplated shall be satisfactory in form and substance to the
Agent and counsel for the Agent.
(j) At any time prior to Closing Time, (i) there shall not have occurred
any material adverse change in the financial markets in the United States or
elsewhere or any outbreak of hostilities or escalation thereof or other calamity
or crisis the effects of which, in the judgment of the Agent, are so material
and adverse as to make it impracticable to market the Securities or to enforce
contracts, including subscriptions or orders, for the sale of the Securities,
and (ii) trading generally on either the Nasdaq National Market or the New York
Stock Exchange shall not have been suspended, or minimum or maximum prices for
trading shall not have been fixed, or maximum ranges for prices for securities
shall not have been required, by either of such Exchange or Market or by order
of the Commission or any other governmental authority, and a banking moratorium
shall not have been declared by either Federal, New York or Massachusetts
authorities.
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SECTION 6. INDEMNIFICATION.
(a) The Company and the Savings Bank, jointly and severally, agree to
indemnify and hold harmless the Agent, each person, if any, who controls the
Agent, within the meaning of Section 15 of the 1933 Act or Section 20 of the
1934 Act, and its respective partners, directors, officers, employees and agents
as follows:
(i) from and against any and all loss, liability, claim, damage
and expense whatsoever, as incurred, related to or arising out of the
Conversion (including the establishment of the Foundation and the
contribution of the Foundation Shares thereto by the Company) or any action
taken by the Agent where acting as agent of the Company and the Savings
Bank or otherwise as described in Section 2 hereof; provided, however, that
-------- -------
this indemnity agreement shall not apply to any loss, liability, claim,
damage or expense found in a final judgment by a court of competent
jurisdiction to have resulted primarily from the bad faith, willful
misconduct or gross negligence of the Agent;
(ii) from and against any and all loss, liability, claim, damage
and expense whatsoever, as incurred, based upon or arising out of any
untrue statement or alleged untrue statement of a material fact contained
in the Registration Statement (or any amendment thereto), or the omission
or alleged omission therefrom of a material fact required to be stated
therein or necessary to make the statements therein not misleading or
arising out of any untrue statement or alleged untrue statement of a
material fact contained in the Prospectus (or any amendment or supplement
thereto) or the omission or alleged omission therefrom of a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
(iii) from and against any and all loss, liability, claim, damage
and expense whatsoever, as incurred, to the extent of the aggregate amount
paid in settlement of any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or of any claim
whatsoever described in clauses (i) or (ii) above, if such settlement is
effected with the written consent of the Company or the Savings Bank, which
consent shall not be unreasonably withheld; and
(iv) from and against any and all expense whatsoever, as incurred
(including, subject to Section 6(c) hereof, the fees and disbursements of
counsel chosen by the Agent), reasonably incurred in investigating,
preparing or defending against any litigation, or any investigation,
proceeding or inquiry by any governmental agency or body, commenced or
threatened, or any pending or threatened claim whatsoever described in
clauses (i) or (ii) above, to the extent that any such expense is not paid
under (i), (ii) or (iii) above;
provided, however, that the indemnification provided for in this paragraph (a)
-------- -------
shall not apply to any loss, liability, claim, damage or expense to the extent
arising out of any untrue statement or alleged untrue statement of a material
fact or omission or alleged omission of
-29-
a material fact required to be stated therein or necessary to make not
misleading any statements contained in the Registration Statement (or any
amendment thereto) or the Prospectus (or any amendment or supplement thereto)
made in reliance upon and in conformity with written information relating to the
Agent furnished to the Company or the Savings Bank by the Agent expressly for
use in the Registration Statement (or any amendment thereto) or the Prospectus
(or any amendment or supplement thereto), which information is included in the
sections captioned "Market for the Common Stock," "The Conversion - Marketing
and Underwriting Arrangements" and "- Syndicated Community Offering" of the
Prospectus. Notwithstanding the foregoing, the indemnification provided for in
this paragraph (a) shall not apply to the Savings Bank to the extent that such
indemnification by the Savings Bank would constitute an impermissible covered
transaction under Section 23A of the Federal Reserve Act.
(b) The Agent agrees to indemnify and hold harmless the Company, the
Savings Bank, their directors and trustees, each of their officers who signed
the Registration Statement, and each person, if any, who controls the Company
within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act
against any and all loss, liability, claim, damage and expense described in the
indemnity contained in subsection (a) of this Section, as incurred, but only
with respect to untrue statements or alleged untrue statements of a material
fact or omissions or alleged omissions of a material fact, made in the
Registration Statement (or any amendment thereto) or the Prospectus (or any
amendment or supplement thereto) in reliance upon and in conformity with the
Agent Information.
(c) Each indemnified party shall give notice as promptly as reasonably
practicable to each indemnifying party of any action commenced against it in
respect of which indemnity may be sought hereunder, but failure to so notify an
indemnifying party shall not relieve such indemnifying party from any liability
that it may have otherwise than on account of this indemnity agreement. An
indemnifying party may participate at its own expense in the defense of any such
action. In no event shall the indemnifying parties be liable for fees and
expenses of more than one counsel (in addition to no more than one local counsel
in each separate jurisdiction in which any action or proceedings is commenced)
separate from their own counsel for all indemnified parties in connection with
any one action or separate but similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances.
(d) The Company and the Savings Bank also agree that the Agent shall not
have any liability (whether direct or indirect, in contract or tort or
otherwise) to the Savings Bank, the Company, its security holders or the Savings
Bank's or the Company's creditors relating to or arising out of the engagement
of the Agent pursuant to, or the performance by the Agent of the services
contemplated by, this Agreement, except to the extent that any loss, claim,
damage or liability is found in a final judgment by a court to have resulted
primarily from the Agent's bad faith, willful misconduct or gross negligence.
(e) In addition to, and without limiting, the provisions of Section
(6)(a)(iv) hereof, in the event that any Agent, any person, if any, who controls
the Agent within the meaning of Section 15 of the 1933 Act or Section 20 of the
1934 Act or any of its partners, directors,
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officers, employees or agents is requested or required to appear as a witness or
otherwise gives testimony in any action, proceeding, investigation or inquiry
brought by or on behalf of or against the Company or the Savings Bank or any of
its respective affiliates or any participant in the transactions contemplated
hereby in which the Agent or such person or agent is not named as a defendant or
subject to an investigation or inquiry, the Company and the Savings Bank jointly
and severally agree to reimburse the Agent for all reasonable and necessary out-
of-pocket expenses incurred by it in connection with preparing or appearing as a
witness or otherwise giving testimony and to compensate the Agent in an amount
to be mutually agreed upon.
SECTION 7. CONTRIBUTION. In order to provide for just and equitable
contribution in circumstances in which the indemnity agreement provided for in
Section 6 hereof is for any reason held to be unenforceable by the indemnified
parties although applicable in accordance with its terms, the Company, the
Savings Bank and the Agent shall contribute to the aggregate losses,
liabilities, claims, damages and expenses of the nature contemplated by said
indemnity agreement incurred by the Company or the Savings Bank and the Agent,
as incurred, in such proportions (i) that the Agent is responsible for that
portion represented by the percentage that the maximum aggregate marketing fees
appearing on the cover page of the Prospectus bears to the maximum aggregate
gross proceeds appearing thereon and the Company and the Savings Bank are
jointly and severally responsible for the balance or (ii) if, but only if, the
allocation provided for in clause (i) is for any reason held unenforceable, in
such proportion as is appropriate to reflect not only the relative benefits to
the Company and the Savings Bank on the one hand and the Agent on the other, as
reflected in clause (i), but also the relative fault of the Company and the
Savings Bank on the one hand and the Agent on the other (relative fault shall be
determined by reference to, among other things, whether the untrue statement of
a material fact or omission to state a material fact relates to information
supplied by the Company and Savings Bank or the Agent and the parties relative
intent, knowledge, and access to information), as well as any other relevant
equitable considerations; provided, however, that no person guilty of fraudulent
-------- -------
misrepresentation (within the meaning of Section 11(f) of the ▇▇▇▇ ▇▇▇) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this Section, each person, if any, who
controls the Agent within the meaning of Section 15 of the 1933 Act or Section
20 of the 1934 Act shall have the same rights to contribution as the Agent, and
each director of the Company, each director of the Savings Bank, each officer of
the Company who signed the Registration Statement, and each person, if any, who
controls the Company or the Savings Bank within the meaning of Section 15 of the
1933 Act or Section 20 of the 1934 Act shall have the same rights to
contribution as the Company and the Savings Bank. Notwithstanding anything to
the contrary set forth herein, to the extent permitted by applicable law, in no
event shall the Agent be required to contribute an aggregate amount in excess of
the aggregate marketing fees to which the Agent is entitled and actually paid
pursuant to this Agreement.
SECTION 8. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE DELIVERY.
All representations, warranties and agreements contained in this Agreement, or
contained in certificates of officers of the Company or the Savings Bank
submitted pursuant
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hereto, shall remain operative and in full force and effect, regardless of any
investigation made by or on behalf of the Agent or any controlling person, or by
or on behalf of the Company, and shall survive delivery of the Securities.
SECTION 9. TERMINATION OF AGREEMENT.
(a) The Agent may terminate this Agreement, by notice to the Company, at
any time at or prior to Closing Time (i) if there has been, since the date of
this Agreement or since the respective dates as of which information is given in
the Registration Statement, any material adverse change in the condition,
financial or otherwise, or in the earnings, business affairs or business
prospects of the Company or the Savings Bank, or the Company, the Savings Bank
and the Subsidiaries, taken as a whole, whether or not arising in the ordinary
course of business; or (ii) if there has occurred any material adverse change in
the financial markets in the United States or elsewhere or any outbreak of
hostilities or escalation thereof or other calamity or crisis the effects of
which, in the judgment of the Agent, are so material and adverse as to make it
impracticable to market the Securities or to enforce contracts, including
subscriptions or orders, for the sale of the Securities; or (iii) or if trading
generally on either the Nasdaq National Market or the New York Stock Exchange
has been suspended, or minimum or maximum prices for trading have been fixed, or
maximum ranges for prices for securities have been required, by either of such
Exchange or Market or by order of the Commission or any other governmental
authority, or if a banking moratorium has been declared by either Federal, New
York or Massachusetts authorities; or (iv) if any condition specified in Section
5 shall not have been fulfilled when and as required to be fulfilled; or (v) if
there shall have been such material adverse change in the condition or prospects
of the Company or the Savings Bank or the prospective market for the Company's
securities as in the Agent's good faith opinion would make it inadvisable to
proceed with the offering, sale or delivery of the Securities; or (vi) if in the
Agent's good faith opinion, the aggregate price for the Securities established
by ▇▇▇▇▇▇ & Company, Inc. is not reasonable or equitable under then prevailing
market conditions; or (vii) if the Conversion is not consummated prior to
__________, 1997.
(b) If this Agreement is terminated pursuant to this Section, such
termination shall be without liability of any party to any other party except
that the provisions of Section 4 relating to reimbursement of expenses and the
provisions of Sections 6 and 7 hereof shall survive any termination of this
Agreement.
SECTION 10. NOTICES. All notices and other communications
hereunder shall be in writing and shall be deemed to have been duly given if
mailed or transmitted by any standard form of telecommunication. Notices to the
Agent shall be directed to the Agent at Two World Trade Center, ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, attention of ▇▇▇▇ ▇. ▇▇▇▇▇, with a copy to ▇▇▇▇ ▇.
▇▇▇▇▇▇▇, Esq., Breyer & Aguggia, ▇▇▇▇ ▇ ▇▇▇▇▇▇, ▇.▇., ▇▇▇▇▇ ▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇; notices to the Company and the Savings Bank shall be
directed to either of them at ▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇, attention ▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, President, with a copy to ▇▇▇▇▇▇ ▇.
Passaic, Jr., Esq., ▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.,
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇.
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SECTION 11. PARTIES. This Agreement shall inure to the benefit of
and be binding upon the Agent, the Company and the Savings Bank and their
respective successors. Nothing expressed or mentioned in this Agreement is
intended or shall be construed to give any person, firm or corporation, other
than the Agent, the Company and the Savings Bank and their respective successors
and the controlling persons and officers and directors referred to in Sections 6
and 7 and their heirs and legal representatives, any legal or equitable right,
remedy or claim under or in respect of this Agreement or any provision herein or
therein contained. This Agreement and all conditions and provisions hereof and
thereof are intended to be for the sole and exclusive benefit of the Agent, the
Company and the Savings Bank and their respective successors, and said
controlling persons and officers and directors and their heirs and legal
representatives, and for the benefit of no other person, firm or corporation.
SECTION 12. ENTIRE AGREEMENT; AMENDMENT. With the exception of
that certain agreement between the Savings Bank and Sandler ▇'▇▇▇▇▇ dated April
12, 1996 relating to records management services in connection with the Savings
Bank's Conversion, this Agreement represents the entire understanding of the
parties hereto with reference to the transactions contemplated hereby and
supersedes any and all other oral or written agreements heretofore made. No
waiver, amendment or other modification of this Agreement shall be effective
unless in writing and signed by the parties hereto.
SECTION 13. GOVERNING LAW AND TIME. This Agreement shall be
governed by and construed in accordance with the laws of the State of New York
applicable to agreements made and to be performed in said State without regard
to the conflicts of laws provisions thereof. Specified times of day refer to
Eastern time.
SECTION 14. SEVERABILITY. Any term or provision of this Agreement
that is invalid or unenforceable in any jurisdiction shall, as to that
jurisdiction, be ineffective to the extent of such invalidity or
unenforceability without rendering invalid or unenforceable the remaining terms
and provisions of this Agreement or affecting the validity or enforceability of
any of the terms or provisions of this Agreement in any other jurisdiction. If
any provision of this Agreement is so broad as to be unenforceable, the
provision shall be interpreted to be only so broad as is enforceable.
SECTION 15. HEADINGS. Sections headings are not to be considered
part of this Agreement, are for convenience and reference only, and are not to
be deemed to be full or accurate descriptions of the contents of any paragraph
or subparagraph.
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If the foregoing is in accordance with your understanding of our agreement,
please sign and return to the Company a counterpart hereof, whereupon this
instrument, along with all counterparts, will become a binding agreement between
the Agent, the Company and the Savings Bank in accordance with its terms.
Very truly yours,
FIRSTFED AMERICA BANCORP, INC.
By:
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
President and Chief Executive Officer
FIRST FEDERAL SAVINGS BANK OF
AMERICA
By:
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
President and Chief Executive Officer
CONFIRMED AND ACCEPTED,
as of the date first above written:
Sandler ▇'▇▇▇▇▇ & Partners, L.P.
By: Sandler ▇'▇▇▇▇▇ & Partners Corp.,
the sole general partner
By:
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