MASSACHUSETTS FINCORP, INC.
COMMITTEE TO ENHANCE STOCKHOLDER VALUE
March 27, 2000
Dear Fellow Stockholder:
On behalf of the Committee to Enhance Stockholder Value (the "Committee"),
I am writing to thank those stockholders who have voted FOR the election of the
three nominees of the Committee (the "Committee Nominees") to the board of
directors of Massachusetts Fincorp, Inc. (the "Company"). If you have not yet
voted, I have enclosed a White proxy card and envelope for your convenience.
We believe that the election of the Committee Nominees will better assure
that the interests of all stockholders are protected and that stockholder value
will be enhanced.
EXAMINE MANAGEMENT'S RECORD - YOU BE THE JUDGE
* DECLINING EARNINGS. Net income has declined in every quarter since the
Company went public in December 1998.
* UNDERPERFORMING STOCK PRICE. The Company's stock price as a percentage of
book value per share was 68% as of March 8th, which was one of the lowest
of all publicly traded thrifts in Massachusetts.
* WASTEFUL EXPENDITURE OF STOCKHOLDERS' INVESTMENT. Measured by its
efficiency ratio (which is non-interest expense as a percent of the sum of
net interest income and non-interest income), the Company is one of the
least efficient (i.e., costliest to operate) of all publicly traded thrifts
in Massachusetts.
* $2,200,000 FOR NEW EXECUTIVE OFFICES. The board approved the purchase of a
one-acre parcel of land in Quincy, Massachusetts for $975,000 and spent an
additional $1,250,000 to remove an existing structure and construct the new
executive headquarters.
* REFUSING TO EXPAND THE BOARD AND AVOID THE PROXY FIGHT. The Company could
have easily avoided a costly proxy contest, costly to the Committee and to
you!
* AMENDING THE BYLAWS TO ELIMINATE STOCKHOLDER RIGHTS. The Company's legal
counsel sent me a letter on January 19th indicating that the Company had
changed its By-laws and that the Committee Nominees were ineligible to run
for board seats. On February 1, 2000, the Company, after wasting
stockholders money on legal fees to change the By-laws, withdrew the
changes.
VOTE THE WHITE PROXY CARD ONLY
-----
WE REQUEST THAT YOU NOT RETURN THE COMPANY'S BLUE PROXY CARD
<PAGE>
In addition to the above, I want to clarify certain information that we
previously provided to stockholders. On page 28 of the 1999 Annual Report and on
page 12 of the Notice of Annual Meeting of Stockholders that you received from
the Company, management goes into great detail on the matter of "Related Party
Transactions". They did not disclose payments to one of the directors for legal
fees in connection with the acquisition and development of the $2.2 million
executive headquarters.
Contrary to our previous statement, management was not required to report
these payments under Securities and Exchange Commission Regulation 404(b).
However, we strongly believe that this information should have been reported to
all stockholders in the "Related Party Transactions" disclosure contained in the
Annual Report and Proxy Statement. We believe that payments of legal fees to
directors are related party transactions, are material and should be fully
disclosed to stockholders.
YOUR VOTE IS IMPORTANT
----------------------
* No matter how many shares you own, we are seeking your support.
* PLEASE VOTE FOR MESSRS. JAINDL, BUCK AND SCHANTZ by signing, dating, and
mailing in the enclosed postage-paid envelope the enclosed WHITE PROXY CARD
as soon as possible. Only your latest dated proxy counts.
* Even if you have already returned a proxy to the Company's board of
directors, you have every legal right to revoke it by signing, dating, and
mailing the enclosed White proxy card or by voting in person at the annual
meeting.
You Can Call If You Have Questions
If you have any questions or require any assistance, please contact Mark
Jaindl at (610) 336-0653 ext. 112, or our proxy solicitors, Beacon Hill
Partners, at (800) 755-5001.
The Committee believes that it is in your best interest to elect the
Committee Nominees as Directors at the Annual Meeting. The Committee Strongly
Recommends a Vote "FOR" the Committee Nominees.
Sincerely,
/s/ Mark W. Jaindl
The Committee to Enhance Stockholder
Value
PLEASE SIGN AND DATE YOUR WHITE PROXY CARD AND RETURN IT
----------------
IN THE ENCLOSED ENVELOPE.
