EXHIBIT 10.24

 

SECOND AMENDMENT TO RIGHTS AGREEMENT

 

Second Amendment, dated as of June 12, 2003 (this “Amendment”), to the Rights
Agreement, dated as of October 12, 1999 (the “Rights Agreement”), between First
Essex Bancorp, Inc., a Delaware corporation (the “Company”), and BankBoston,
N.A., a national banking association, as Rights Agent, amended effective
November 14, 2001 to appoint EquiServe Trust Company, N.A. the Rights Agent (the
“Rights Agent”).  Capitalized terms not otherwise defined in this Amendment
shall have the meaning ascribed to them in the Rights Agreement.

 

WHEREAS, pursuant to Section 26 of the Rights Agreement, the Company may, prior
to the Distribution Date and subject to the last sentence of Section 26,
supplement or amend any provision of the Rights Agreement without the approval
of any holders of the Rights; and

 

WHEREAS, the Company now desires to amend the Rights Agreement as set forth in
this Amendment, and pursuant to Section 26 of the Rights Agreement, the Company
hereby directs that the Rights Agreement shall be amended as set forth in this
Amendment.

 

NOW THEREFORE, in consideration of the premises and the mutual agreements herein
set forth, the parties hereby agree as follows:

 

1. AMENDMENTS TO SECTION 1.

 

(A) SECTION 1 OF THE RIGHTS AGREEMENT IS HEREBY AMENDED BY ADDING THE FOLLOWING
DEFINITIONS:

 

“Sovereign” shall mean Sovereign Bancorp, Inc., a Pennsylvania corporation.

 

“Merger” shall have the meaning set forth in the Merger Agreement.

 

“Merger Agreement” shall mean the Agreement and Plan of Merger, by and among the
Company, Sovereign Merger Sub, Inc. and Sovereign, authorized and approved by
the Board of Directors of the Company at the meeting of the Board of Directors
held on June 12, 2003, as it may be amended from time to time.

 

(B) THE DEFINITION OF “ACQUIRING PERSON” IN SECTION 1 OF THE RIGHTS AGREEMENT IS
HEREBY AMENDED BY INSERTING THE FOLLOWING SENTENCE AT THE END THEREOF:

 

“Notwithstanding the foregoing or any other provision of this Rights Agreement
to the contrary, none of Sovereign, any Subsidiary of Sovereign or any other
Person shall be deemed to be an Acquiring Person by virtue of the Merger
Agreement as a result of any of (i) the announcement or execution of the Merger
Agreement, or the announcement or execution of any other transactions
contemplated thereby; (ii) the consummation of the

 

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Merger or any other transactions contemplated in the Merger Agreement; (iii) the
consummation of the Bank Merger (as defined in the Merger Agreement) or any
other transactions contemplated in the Bank Plan of Merger (as defined in the
Merger Agreement), or of the merger of any other subsidiaries of the Company or
Sovereign contemplated by the Merger Agreement; or (iv) the announcement or
execution by Sovereign of any form of affiliate letter in connection with the
Merger Agreement, between Sovereign and various stockholders of the Company, or
the exercise by Sovereign of any of its rights thereunder (each of (i), (ii),
(iii) and (iv) are hereinafter referred to as a “Sovereign Transaction”).”

 

2. AMENDMENTS TO SECTION 3(B).  SECTION 3(B) OF THE RIGHTS AGREEMENT IS HEREBY
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 any
Sovereign Transaction.”

 

3. AMENDMENT TO SECTION 11(C).  SECTION 11(C) OF THE RIGHTS AGREEMENT IS HEREBY
AMENDED BY ADDING THE FOLLOWING SENTENCE AT THE END THEREOF:

 

“(IV)       Notwithstanding anything in this Rights Agreement to the contrary,
each Sovereign Transaction shall not be deemed to be a Business Combination and
shall not cause the Rights to be adjusted or exercisable in accordance with, or
any other action to be taken or any obligation or duty to arise pursuant to,
this Section 11(c).”

 

4. AMENDMENT TO SECTION 12(A).  SECTION 12(A) OF THE RIGHTS AGREEMENT IS HEREBY
AMENDED BY ADDING THE FOLLOWING SENTENCE AT THE END THEREOF:

 

“Notwithstanding anything in this Rights Agreement to the contrary, each
Sovereign Transaction shall not be deemed to be a change in the Common Shares or
the Preferred Shares under this Section 12(a) and shall not cause the Rights to
be adjusted or exercisable in accordance with, or any other action to be taken
or any obligation or duty to arise pursuant to, this Section 12.”

 

5. AMENDMENT TO SECTION 22.  SECTION 22 OF THE RIGHTS AGREEMENT IS HEREBY
AMENDED BY ADDING THE FOLLOWING SENTENCE AFTER THE FIRST SENTENCE:

 

“In the event the transfer agency relationship in effect between the Company and
the Rights Agent terminates, the Rights Agent will be deemed to have resigned on
the effective date of such termination.”

 

6. NEW SECTION 33.  A NEW SECTION 33 IS ADDED AS FOLLOWS:

 

“Notwithstanding anything to the contrary contained herein, the Rights Agent
shall not be liable for any delays or failures in performance resulting from
acts beyond its reasonable control including, without limitation, acts of God,
terrorist acts, shortage of supplies, breakdowns or malfunctions, interruptions
or malfunction of computer facilities

 

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or loss of data due to power failures or mechanical difficulties with
information storage or retrieval systems, labor difficulties, war or civil
unrest.”

 

7. EFFECTIVENESS.  THIS AMENDMENT SHALL BE DEEMED EFFECTIVE AS OF THE DATE FIRST
ABOVE WRITTEN, AS IF EXECUTED BY THE COMPANY ON SUCH DATE.  EXCEPT AS EXPRESSLY
SET FORTH HEREIN, THIS AMENDMENT SHALL NOT BY IMPLICATION OR OTHERWISE ALTER,
MODIFY, AMEND OR IN ANY WAY AFFECT ANY OF THE TERMS, CONDITIONS, OBLIGATIONS,
COVENANTS OR AGREEMENTS CONTAINED IN THE RIGHTS AGREEMENT, ALL OF WHICH ARE
RATIFIED AND AFFIRMED IN ALL RESPECTS AND SHALL CONTINUE IN FULL FORCE AND
EFFECT AND SHALL BE OTHERWISE UNAFFECTED.  THE COMPANY AGREES THAT IT SHALL NOT,
WITHOUT THE PRIOR WRITTEN CONSENT OF SOVEREIGN, AMEND THE RIGHTS AGREEMENT IN A
MANNER WHICH SHALL (I) CAUSE SOVEREIGN, OR ANY OF ITS SUBSIDIARIES, TO BECOME AN
ACQUIRING PERSON AS A RESULT OF ANY SOVEREIGN TRANSACTION; (II) CAUSE A
DISTRIBUTION DATE TO OCCUR AS A RESULT OF ANY SOVEREIGN TRANSACTION; (III) CAUSE
ANY RIGHT TO BECOME EXERCISABLE IN ACCORDANCE WITH THE RIGHTS AGREEMENT AS A
RESULT OF ANY SOVEREIGN TRANSACTION; OR (IV) CAUSE ANY RIGHT TO BE ADJUSTED OR
BECOME ELIGIBLE FOR EXCHANGE PURSUANT TO SECTION 11 OF THE RIGHTS AGREEMENT OR
GIVE ANY HOLDERS OF RIGHTS THE RIGHT TO RECEIVE OR PURCHASE ANY SECURITIES OF
ANY PERSON PURSUANT TO SUCH SECTION 11 AS A RESULT OF ANY SOVEREIGN
TRANSACTION.  NOTWITHSTANDING THE FOREGOING, IF SOVEREIGN, OR ANY OF ITS
SUBSIDIARIES, ACQUIRES BENEFICIAL OWNERSHIP OF ANY SECURITIES OF THE COMPANY
OTHER THAN PURSUANT TO A SOVEREIGN TRANSACTION, THEN THE PREVIOUS SENTENCE SHALL
BE RESCINDED AND BE OF NO FURTHER FORCE OR EFFECT.

 

8. GOVERNING LAW.  THIS AMENDMENT SHALL BE DEEMED TO BE A CONTRACT MADE UNDER
THE LAWS OF THE STATE OF DELAWARE 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.

 

9. COUNTERPARTS.  THIS AMENDMENT MAY BE EXECUTED IN ANY NUMBER OF COUNTERPARTS,
EACH OF SUCH COUNTERPARTS SHALL FOR ALL PURPOSES BE DEEMED AN ORIGINAL, AND ALL
SUCH COUNTERPARTS TOGETHER SHALL CONSTITUTE BUT ONE AND THE SAME INSTRUMENT.

 

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IN WITNESS WHEREOF, the parties have caused this Amendment to be duly executed
as of the day and year first above written.

 

 

FIRST ESSEX BANCORP, INC.

 

 

 

 

 

/s/ William F. Burke

 

 

William F. Burke

 

Executive Vice President

 

 

 

 

 

EQUISERVE TRUST COMPANY, N.A.

 

 

 

 

 

/s/ Margaret M.. Prentice

 

 

Margaret M. Prentice

 

Managing Director

 

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