EXHIBIT 3
AMENDMENT TO AMENDED AND RESTATED
SHAREHOLDERS RIGHTS AGREEMENT
Amendment, dated as of June 13, 2002 (this "Amendment"), to the Amended
and Restated Shareholders Rights Agreement, dated as of November 26, 1997 (as
amended, the "Rights Agreement"), by and between Medford Bancorp, Inc., a
Massachusetts corporation (the "Company"), Medford Savings Bank, a Massachusetts
savings bank, and EquiServe Trust Company, N.A., as rights agent (the "Rights
Agent").
WHEREAS, in accordance with the terms of the Rights Agreement, the Company
deems it desirable to make certain amendments to the Rights Agreement; and
WHEREAS, Section 27 of the Rights Agreement provides that prior to the
Distribution Date (as defined in the Rights Agreement), the Company and the
Rights Agent shall, if the Company so directs, supplement or amend any provision
of the Rights Agreement without the approval of any holders of certificates
representing shares of the Company's common stock; and
WHEREAS, the Company intends to enter into an Agreement and Plan of Merger
(the "Merger Agreement") with Citizens Financial Group, Inc., a Delaware
corporation ("CFG"), and Citizens Bank of Massachusetts, a Massachusetts
chartered trust company (the "CBM"), pursuant to which, among other things, a
subsidiary of CBM will be merged with and into the Company; and
WHEREAS, prior to entering into the Merger Agreement and related
agreements, the Company desires to amend certain provisions of the Rights
Agreement so that the execution, delivery and performance of the Merger
Agreement and the Stockholders Agreements referred to below will not cause the
Rights issued under the Rights Agreement to become exercisable.
NOW, THEREFORE, in consideration of the premises and mutual agreements
herein set forth, the parties hereby agree as follows:
1. Amendments of Section 1.
(a) The definition of "Acquiring Person" set forth in Section 1 of the
Rights Agreement is amended to add the following sentence at the end thereof:
"Notwithstanding anything in this Rights Agreement to the contrary,
neither Citizens Financial Group, Inc. ("CFG"), any of its existing or
future Affiliates or Associates nor any Stockholder (as defined below)
shall be deemed to be an Acquiring Person as a result of (i) the
execution, delivery or performance of the Agreement and Plan of Merger,
dated as of June 13, 2002, by and among the Company, Citizens Bank of
Massachusetts ("CBM") and CFG (as the same may be amended from time to
time, the "Merger Agreement"), pursuant to which a subsidiary of CBM will
be merged with and into the Company; (ii) the execution, delivery or
performance of the Stockholders Agreements, each dated as of June 13,
2002, by and between CBM and certain officers and directors of the Company
(each a "Stockholder" and collectively the "Stockholders") as contemplated
by the Merger Agreement (as the same may be amended from
time to time, collectively, the "Stockholders Agreements"); or (iii) the
consummation of the transactions contemplated by the Merger Agreement
(including, without limitation, the acquisition of Shares (as defined in
the Merger Agreement))."
(b) Section 1(e) of the Rights Agreement is amended by adding the
following sentence at the end thereof:
"Notwithstanding anything in this Rights Agreement to the contrary,
neither CFG, any of its existing or future Affiliates or Associates nor
any Stockholder shall be deemed to be the Beneficial Owner of shares of
Common Stock of the Company as a result of (i) the execution, delivery or
performance of the Merger Agreement or the Stockholders Agreements, or
(ii) the consummation of the transactions contemplated by the Merger
Agreement (including, without limitation, the acquisition of Shares (as
defined in the Merger Agreement))."
(c) The definition of "Triggering Event" set forth in Section 1 of the
Rights Agreement is amended to add the following proviso at the end thereof:
"; provided, however, that no Triggering Event shall occur as a result of
(i) the execution, delivery or performance of the Merger Agreement or the
Stockholders Agreements, or (ii) the consummation of the transactions
contemplated by the Merger Agreement (including, without limitation, the
acquisition of Shares (as defined in the Merger Agreement))."
(d) The definition of "Stock Acquisition Date" in Section 1 of the Rights
Agreement is amended by adding the following sentence at the end thereof:
"Notwithstanding anything in this Rights Agreement to the contrary, a
Stock Acquisition Date shall not be deemed to have occurred as a result of
(i) the execution, delivery or performance of the Merger Agreement or the
Stockholders Agreements, or (ii) the consummation of the transactions
contemplated by the Merger Agreement (including, without limitation, the
acquisition of Shares (as defined in the Merger Agreement))."
2. Amendment of Section 3(a). Section 3(a) of the Rights Agreement is
amended to add the following sentence at the end thereof:
"Notwithstanding anything in this Rights Agreement to the contrary, a
Distribution Date shall not be deemed to have occurred as a result of (i)
the execution, delivery or performance of the Merger Agreement or the
Stockholders Agreements, or (ii) the consummation of the transactions
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contemplated by the Merger Agreement (including, without limitation, the
acquisition of Shares (as defined in the Merger Agreement))."
3. Amendment of Section 7(a). Section 7(a) of the Rights Agreement is
amended by:
(A) deleting subclause (i) in its entirety and inserting the following in
lieu thereof:
"(i) the moment in time immediately prior to the Effective Time (as such
term is defined in the Merger Agreement) (the "Final Expiration Date")";
and
(B) by adding the following sentence at the end thereof:
"Notwithstanding anything in this Rights Agreement to the contrary,
neither (i) the execution, delivery or performance of the Merger Agreement
or the Stockholders Agreement; nor (ii) the consummation of the
transactions contemplated by the Merger Agreement (including, without
limitation, the acquisition of Shares (as defined in the Merger
Agreement)), shall be deemed to be events that cause the Rights to become
exercisable pursuant to the provisions of this Section 7 or otherwise."
4. Amendment of Section 11. Section 11 of the Rights Agreement is amended
to add the following sentence after the first sentence of said Section:
"Notwithstanding anything in this Rights Agreement to the contrary,
neither (i) the execution, delivery or performance of the Merger Agreement
or the Stockholders Agreement; nor (ii) the consummation of the
transactions contemplated by the Merger Agreement (including, without
limitation, the acquisition of Shares (as defined in the Merger
Agreement)), shall be deemed to be a Section 11(a)(ii) Event or to cause
the Rights to be adjusted or to become exercisable in accordance with this
Section 11."
5. Amendment of Section 13. Section 13 of the Rights Agreement is amended
to add the following sentence at the end thereof:
"Notwithstanding anything in this Rights Agreement to the contrary,
neither (i) the execution, delivery or performance of the Merger Agreement
or the Stockholders Agreement; nor (ii) the consummation of the
transactions contemplated by the Merger Agreement (including, without
limitation, the acquisition of Shares (as defined in the Merger
Agreement)), shall be deemed to be a Section 13 Event or to cause the
Rights to be adjusted or to become exercisable in accordance with Section
13."
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6. Amendment to Section 21. Section 21 of the Rights Agreement is amended
to add the following sentence after the first sentence of such section:
"In the event that the Company's Agreement for Stock Transfer Agent
Services is terminated in accordance with its terms, the Rights Agent
shall be deemed to have resigned as Rights Agent automatically on the
termination date of such agreement, and the Company will provide any
notice to the holders of Rights Certificates of such resignation required
under this Agreement."
7. Effectiveness. This Amendment shall be deemed effective as of the point
in time immediately prior to the execution and delivery of the Merger Agreement
by the Company, CFG and CBM. Except as amended hereby, the Rights Agreement
shall remain in full force and effect and shall be otherwise unaffected hereby.
8. Miscellaneous. Capitalized terms used herein without definition shall
have the meanings given to them in the Rights Agreement. This Amendment shall be
deemed to be a contract made under the laws of The Commonwealth of Massachusetts
and for all purposes shall be governed by and construed in accordance with the
laws of such state applicable to contracts to be made and performed entirely
within such state. This Amendment may be executed in any number of counterparts,
each of such counterparts shall for all purposes be deemed to be an original,
and all such counterparts shall together constitute but one and the same
instrument. If any provisions, covenant or restriction of this Agreement is held
by a court of competent jurisdiction or other authority to be invalid, illegal
or unenforceable, the remainder of the terms, provisions, covenants and
restrictions of this Amendment shall remain in full force and effect and shall
in no way be effected, impaired or invalidated.
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EXECUTED under seal as of the date set forth above.
Attest: MEDFORD BANCORP, INC.
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇ By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇ Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: E.V.P./C.F.O. Title: Chairman/President/C.E.O.
Attest: MEDFORD SAVINGS BANK
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇ By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇ Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: E.V.P./C.F.O. Title: Chairman/President/C.E.O.
Attest: EQUISERVE TRUST COMPANY, N.A.,
as Rights Agent
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇ By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
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Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇ Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: Account Manager Title: Managing Director
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