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


 

















 


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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