<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended: March 31, 1997
Commission file number 0-1739
------
MADISON BANCSHARES GROUP, LTD.
- -------------------------------------------------------------------------------
(Exact Name of Small Business Issue as Specified In Its Charter)
Pennsylvania 33-2512079
-------------------- ------------------------------------
(State or other jurisdiction of (IRS Employer Identification Number)
incorporation or organization)
1767 Sentry Parkway West, Blue Bell, PA 19422
-------------------------------------------- -----------
(Address of principal executive offices) (Zip Code)
(215) 641-1111
- ------------------------------------------------------------------------------
(Registrant's telephone number, including area code)
N/A
- -------------------------------------------------------------------------------
(Former name, former address and former fiscal year, if changed since
last report)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the past 12 months (or for such shorter periods that the Registrant
was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
YES ____ X NO____
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the Issuer's classes
of common stock, as of the latest practicable date.
1,044,033 shares of Issuer's Common Stock, par value $1 per share, issued
and outstanding as of May 1, 1997.
<PAGE>
PART 1
ITEM 1 - FINANCIAL STATEMENTS
MADISON BANCSHARES GROUP, LTD. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF INCOME
FOR THE THREE MONTHS ENDED MARCH 31, 1997 AND 1996
(Unaudited)
<TABLE>
<CAPTION>
1997 1996
------------ ------------
<S> <C> <C>
Interest income:
Interest and fees on loans........................................ $ 2,155,773 $ 1,805,058
Interest and dividends on investment securities:
US Government obligations........................................ 53,045 74,135
Municipal bonds.................................................. 12,204 12,231
Other securities................................................. 17,133 6,909
Interest on temporary investments................................ 23,657 38,878
------------ -----------
2,261,812 1,937,211
Interest expense:
Interest on:
Demand deposits.................................................. 25,924 18,432
Savings and money market deposits................................ 144,038 161,967
Time deposits.................................................... 715,340 658,657
Federal Funds Purchased.......................................... 124,686 69
------------ ------------
1,009,988 839,125
Net interest income before provision for loan losses............... 1,251,824 1,098,086
Provision for loan losses.......................................... 90,000 90,000
------------ ------------
Net interest income after provision for loan losses................ 1,161,824 1,008,086
Other noninterest income:
Gain on sale of mortgage loans.................................... 37,401 15,619
Service charges on deposit accounts............................... 96,501 70,166
Gain on sale of investments ......................................
Other............................................................. 21,378 14,952
------------ ------------
Total noninterest income....................................... 155,280 100,737
Other noninterest expenses:
Salary and employee benefits...................................... 551,616 435,063
Occupancy......................................................... 167,277 126,342
Equipment......................................................... 56,893 44,970
Computer processing............................................... 59,418 49,647
Deposit insurance................................................. 2,000 500
Legal............................................................. 6,050 17,435
Professional fees................................................. 17,205 19,625
Business development.............................................. 32,437 27,385
Office and stationary supplies.................................... 31,619 19,852
Advertising....................................................... 23,151 19,765
Other operating................................................... 120,781 110,238
------------ ------------
Total noninterest expenses..................................... 1,068,447 870,822
Income before income taxes......................................... 248,657 238,001
Provision for income taxes......................................... 86,000 79,060
------------ ------------
Net income......................................................... $ 162,657 $ 158,941
------------ ------------
------------ ------------
Net income per common share........................................ $ 0.16 $ 0.15
Weighted average number of shares.................................. 1,044,033 1,037,432
</TABLE>
<PAGE>
MADISON BANCSHARES GROUP, LTD. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(Unaudited)
<TABLE>
<CAPTION>
MARCH 31, 1997 DECEMBER 31, 1996
-------------- -----------------
<S> <C> <C>
ASSETS
Cash and Cash Equivalents:
Cash and amounts due from banks........................... $ 5,586,037 $ 4,381,957
Federal funds sold........................................ 2,840,000 925,000
-------------- ---------------
Total cash and cash equivalents........................ 8,426,037 5,306,957
Investment Securities:
Held to maturity (fair value--1997 $2,092,460;
1996 $2,097,349)......................................... 2,107,517 2,108,206
Available for sale (amortized cost
1997 $3,518,742; 1996 $3,595,891)........................ 3,502,338 3,585,406
Loans (Net of allowance for loan losses--
1997, $965,438; 1996, $875,438)........................... 92,594,586 90,783,582
Mortgage loans held for sale............................... 703,991 2,111,618
Real Estate Owned.......................................... 509,618 511,618
Furniture, Equipment and Leasehold Improvements............ 552,993 584,533
Accrued interest receivable................................ 681,729 641,570
Other Assets............................................... 558,944 337,385
-------------- ---------------
TOTAL...................................................... $ 109,637,753 $ 105,970,875
-------------- ---------------
-------------- ---------------
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits:
Noninterest-bearing demand deposits....................... $ 13,775,775 $ 14,660,464
Interest-bearing demand deposits.......................... 5,735,778 4,564,916
Savings deposits.......................................... 5,035,106 4,571,352
Money market deposits..................................... 13,549,880 14,409,382
Time deposits............................................. 52,539,148 48,993,877
-------------- ---------------
Total Deposits......................................... 90,635,687 87,199,991
Borrowed Funds............................................. 10,000,000 10,000,000
Accrued Interest Payable................................... 814,540 704,707
Accrued Expenses and Other Liabilities..................... 54,556 91,957
-------------- ---------------
Total Liabilities...................................... 101,504,783 97,996,655
Commitments
Shareholders Equity:
Preferred stock, $5 par value--authorized 5,000,000
shares; issued and outstanding, 0 shares.
Common stock, $1 par value--authorized 20,000,000
shares; issued and outstanding, 1997, 1,044,033 shares;
1996, 971,360 shares..................................... 1,044,033 971,360
Capital surplus........................................... 7,821,575 7,185,686
Accumulated deficit....................................... (721,811) (175,907)
Net unrealized losses on available for sale securities.... (10,827) (6,919)
-------------- ---------------
Total shareholders' equity............................. 8,132,970 7,974,220
-------------- ---------------
TOTAL...................................................... $ 109,637,753 $ 105,970,875
-------------- ---------------
-------------- ---------------
</TABLE>
2
<PAGE>
MADISON BANCSHARES GROUP, LTD. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 1997 AND 1996
(Unaudited)
<TABLE>
<CAPTION>
1997 1996
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<S> <C> <C>
Operating activities:
Net income.......................................................... $ 162,657 $ 158,941
Adjustments for non-cash items included in net income:
Depreciation and amortization...................................... 39,415 31,461
Provision for loan losses.......................................... 90,000 90,000
Net amortization of bond premium/discount.......................... 1,849 186
Amortization of deferred fees & costs, net......................... (18,313) (45,461)
Gain on sale of mortgages held for sale............................ (23,151) (15,619)
Gain on sale of investments........................................
Changes in assets and liabilities which provided (used) cash:
Mortgage loans held for resale.................................... 1,430,279 (1,155,367)
Interest receivable............................................... (40,159) 7,323
Other assets...................................................... (221,559) (208,682)
Accrued interest payable.......................................... 109,833 243,233
Accrued expenses and other liabilitis............................. (37,401) (278,709)
----------- -----------
Net cash provided by (used in) operating activities.................. 1,493,450 (1,172,694)
Investing activities:
Proceeds from sale of investment securities available for sale..... 78,500
Proceeds from maturity of investment securities.................... 2,100,000
Purchase of investment securities.................................. (106,000)
Net change in loans to customers................................... (1,882,691) (3,819,811)
Purchase of furniture, equipment and leasehold improvements........ (7,875) (61,056)
Proceeds on sale of real estate owned.............................. 2,000
---------- ----------
Net cash used in investing activities............................... (1,810,066) (1,886,867)
Financing activities:
Increase in demand, savings and time deposits...................... 3,435,696 388,869
---------- -----------
Net cash provided by financing activities........................... 3,435,696 388,869
Net increase (decrease) in cash and cash equivalents................ 3,119,080 (2,670,692)
----------- -----------
Cash and cash equivalents, beginning of year........................ 5,306,957 10,473,002
----------- -----------
Cash and cash equivalents, end of period............................ $ 8,426,037 $ 7,802,310
----------- -----------
----------- -----------
Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest.......................................................... $ 900,153 $ 595,892
Income taxes...................................................... $ 125,000 $ 361,527
Supplemental disclosures of noncash investing activities Unrealized
loss on available for sale securities............................. $ (10,827) $ (16,653)
</TABLE>
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
<PAGE>
MADISON BANCSHARES GROUP, LTD. AND SUBSIDIARY
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 1997
1. Basis of presentation:
The accompanying unaudited consolidated financial statements were prepared
in accordance with instructions for quarterly reports on Form 10-Q and,
therefore, do not include information or footnotes necessary for a complete
presentation of financial condition, results of operations, shareholders'
equity and cash flows in conformity with generally accepted accounting
principles. However, the financial statements reflect all adjustments
which in the opinion of management are necessary for fair statement of
financial results and that all adjustments are of a normal recurring
nature. The results of operations for the three month periods ended March
31, 1997 and 1996 are not necessarily indicative of the results which may
be expected for the entire fiscal year.
2. Principles of consolidation:
The consolidated financial statements include the accounts of Madison
Bancshares Group, Ltd. and its wholly owned subsidiary, Madison Bank (the
Bank). All material intercompany balances and transactions have been
eliminated.
3. Stock dividends:
On January 21, 1997, the Board of Directors declared a 7-1/2% stock
dividend on Common Stock outstanding. The dividend was paid on February
20, 1997 to shareholders of record on February 5, 1997. This resulted in
an additional issuance of 72,673 shares of common stock.
4. Provision for income taxes:
The provision for income taxes is computed in accordance with Statement of
Financial Accounting Standards (SFAS) No. 109.
Three months ended
3/31/97 3/31/96
--------------------
Provision for current income taxes $86,000 $ 79,060
Provision for deferred income taxes ------- --------
Total $86,000 $ 79,060
------- ---------
------- ---------
A reconciliation between the provision for income taxes computed at the
statutory federal income tax rate of 34% and the actual provision for
income taxes is as follows:
Three months ended
3/31/97 3/31/96
-------------------
Federal income tax provision at statutory
rate $86,000 $79,060
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Actual provision for income taxes $86,000 $79,060
------- -------
------- -------
<PAGE>
MADISON BANCSHARES GROUP, LTD. AND SUBSIDIARY
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 1997
5. Net income per share:
Net income per share of common stock is based upon the weighted average
number of shares outstanding during the period of 1,044,033 in March, 1997
and 1,037,432 in March, 1996, after giving effect to the stock dividend of
January, 1997.
<PAGE>
ITEM 2--MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
This report contains "forward-looking" statements. Madison Bancshares Group,
Ltd. (the "Company") is including this statement for the express purpose of
availing itself of the protections of the safe harbor provided by the Private
Securities Litigation Reform Act of 1995 with respect to all such forward-
looking statements. Examples of forward-looking statements include, but are not
limited to (a) projections of changes in capital-to-assets ratio, (b) statements
of plans and objectives of the Company or its management or Board of Directors,
(c) statements of future economic performance and (d) statements of assumptions
underlying other statements and statements about the Company or its business.
Presented herein are the results of operations of the Company and its wholly
owned subsidiary, The Madison Bank (the "Bank"), for the quarters ended March
31, 1997 and 1996. The Bank commenced operations in August, 1989.
CAPITAL RESOURCES
The total shares of common stock outstanding on March 31, 1997 were
1,044,033 as compared to 964,759 at March 31, 1996. In April and June, 1996, the
Company issued an aggregate of 6,601 shares of common stock in connection with
the exercise of warrants. On February 20, 1997, an additional 72,673 shares were
issued in pursuant to a 7-1/2% stock dividend declared on January 21, 1997. The
book value per share of the Company's common stock (as adjusted for stock
dividends) at December 31, 1996 was $7.64 compared to $7.79 per share at March
31, 1997.
The chart below depicts certain capital ratios applicable to state chartered
Federal Reserve member banks and compares the Bank's actual ratios at March 31,
1997 and December 31, 1996, respectively, each of which exceeded the levels
required for a bank to be classified as well-capitalized.
<TABLE>
<CAPTION>
REGULATORY ACTUAL ACTUAL
RATIO MINIMUM 12/31/96 3/31/97
- ----------------------------------------------------------------------------------- --------------- ----------- -----------
<S> <C> <C> <C>
Qualifying Total Capital to Risk Weighted Assets................................... 8.0% 10.09% 10.94%
Tier 1 Capital, net of intangibles to Risk Weighted Assets......................... 4.0% 9.08% 9.77%
Tier 1 Leverage Ratio of Capital to Total Adjusted Average Assets.................. 4.0% 8.37% 7.55%
</TABLE>
<PAGE>
The Company's capital-to-assets ratio decreased from 7.52% as of December
31, 1996 to 7.42% as of March 31, 1997. Management anticipates that the
capital-to-assets ratio will continue to decline in future periods in the event
that the Company's assets continue to grow. For the quarter ended March 31,1997,
the Company's average return on equity was 8.13% and its return on average
assets was .60%. The Company's average return on equity as of December 31, 1996
was 7.04%; and its return on average assets was .61%.
LIQUIDITY
The Bank's Asset/Liability Management Committee, comprised of the members of
the Bank's Executive Committee and its Treasurer, are responsible for managing
the liquidity position and interest rate sensitivity of the Bank. The
Committee's function is to balance the Bank's interest sensitive assets and
liabilities, while providing adequate liquidity for projected needs. The primary
objective of the Asset/ Liability Committee is to optimize net interest margin
in an ever changing rate environment.
Due to the nature of the Company's business, some degree of interest rate
risk is inherent and appropriate. Management attempts to manage the level of
earnings exposure arising from interest rate movements.
Interest rate sensitivity is measured by the difference between interest
earning assets and interest-bearing liabilities which mature or reprice within a
specific time interval ("Gap"). A positive Gap indicates that interest earning
assets exceed interest bearing liabilities within a given interval. A positive
Gap position results in increased net interest income when rates increase and a
corresponding decrease when rates decline.
In the opinion of the Company's management, the effect of any future
inflation, reflected in a higher costs of funds environment, would be minimal
since the Bank has the ability to quickly increase yields on its interest
earning assets (primarily short term investments and commercial loans) through
the matching of funds.
At March 31, 1997, the risk management review indicated that if interest
rates change in the future, the general effect on profits of the Bank's gap
position, within a one year period, would be plus or minus (+ or -) $94,350, or
.09 basis points. Management believes that any impact will not be significant.
Management attempts to structure the Balance Sheet to provide for the
repricing of assets and liabilities in approximately equal amounts.
<PAGE>
RESULTS OF OPERATIONS
As of March 31, 1997, the Company held deposits aggregating $90,635,687,
which reflects an increase over deposits of $87,199,991 held at December 31,
1996. Of the $90,635,687 deposits held at March 31, 1997, $13,775,775, or
approximately 15%, were non-interest bearing deposits. Total deposit accounts
numbered 6,289 at March 31, 1997. As of the same date, outstanding loans
receivable in connection with loans made to 1,287 loan accounts totaled
approximately $94,457,476 (excluding loan loss reserve and deferred loan fees).
The following tables and graphs set forth a comparative breakdown of the
Company's deposits and loans outstanding for the periods ended March 31, 1997
and December 31, 1996, respectively.
DEPOSIT LIABILITIES
<TABLE>
<CAPTION>
MARCH 31, 1997 DECEMBER 31, 1996
-------------------------- --------------------------
<S> <C> <C> <C> <C>
% OF % OF
TYPE OF ACCOUNT BALANCE PORTFOLIO BALANCE PORTFOLIO
- -------------------------------------------------------------- ------------- ----------- ------------- -----------
Non-Interest bearing (1)...................................... 13,775,775 15% 14,660,464 17%
Interest bearing (2).......................................... 5,735,778 6 4,564,916 5
Money Market (3).............................................. 13,549,880 15 14,409,382 17
Savings (4)................................................... 5,035,106 6 4,571,352 5
CD's Under 100M (5)........................................... 30,242,783 33 25,649,521 33
CD's Over 100M (6)............................................ 22,296,365 21 23,344,356 23
------------- --- ------------- ---
Totals........................................................ $ 90,635,687 100% $ 87,199,991 100%
------------- --- ------------- ---
------------- --- ------------- ---
</TABLE>
[cad 157]CHART[cad 179] [cad 157]CHART[cad 179]
<PAGE>
LOANS OUTSTANDING
<TABLE>
<CAPTION>
MARCH 31, 1997 DECEMBER 31, 1996
-------------------------- --------------------------
<S> <C> <C> <C> <C>
% OF % OF
TYPE OF ACCOUNT BALANCE PORTFOLIO BALANCE PORTFOLIO
- -------------------------------------------------------------- ------------- ----------- ------------- -----------
Real Estate Loans, Mortgages(1)............................... $ 48,353,301 51% $ 44,800,169 48%
Commercial Loans (2).......................................... 39,878,247 42 38,685,537 41
Consumer Loans (3)............................................ 5,521,937 6 8,348,462 9
Residential Loans Held for Sale (4)........................... 703,991 1 2,111,618 2
------------- --- ------------- ---
Totals........................................................ $ 94,457,476 100% $ 93,945,786 100%
------------- --- ------------- ---
------------- --- ------------- ---
</TABLE>
[cad 157]CHART[cad 179] [cad 157]CHART[cad 179]
The primary source of earnings for the Company, the Bank is net
interest income, the difference between the interest earned on loans and other
investments and the interest paid on deposits and other borrowings.
<PAGE>
The graph below sets forth the Bank's interest income and interest expense
growth for the period from March 31, 1996 through March 31, 1997:
[cad 157]graph[cad 179]
For the three months ended March 31, 1997, the Company's net income was
$162,657 or $.16 per share, as compared to net income of $.15 per share during
the three month period ended March 31, 1996. The increase from $158,941 to
$162,657 was attributable to asset growth of the Bank, specifically loan growth.
The Bank's net interest income, after provision for loan losses, for the
quarters ended March 31, 1997 and March 31, 1996 were $1,161,824 and $1,008,086,
respectively. Total interest income was $2,261,812 for the quarter ended March
31, 1997, as compared to $1,937,211 for the quarter ended March 31, 1996.
Interest paid on deposits and borrowings increased to $1,009,988 from $839,125
during the corresponding quarter of 1997.
<PAGE>
The increase in interest income primarily was due to growth in loans as the
graph below depicts.
[cad 157]GRAPH[cad 179]
As of December 31, 1996 the Bank had $875,438 in its allowance for loan
losses representing .96% of outstanding loans receivable. During the first
quarter of 1997, the Bank added $90,000 to the reserve representing 1.02% of
outstanding loans receivable. There were no loans charged off against the
reserve in the first quarter and there were no recoveries. The allowance for
loan loss reserve is $965,438 as of March 31, 1997. The principal amount of
non-accrual loans at March 31, 1997 totaled $934,113 as compared to $735,007 as
of December 31, 1996. A substantial portion of the non-accrual loans are
partially or fully secured and in the process of collection. Management believes
that the allowance for loan losses is reasonable and adequate to cover any known
losses or any losses reasonably expected in the portfolio.
Other real estate owned at March 31, 1997 totaled $509,618. This represents
one property in Bryn Mawr, Pennsylvania in connection with which the Bank has
entered into a lease purchase agreement. The Bank continues to receive a monthly
rental fee and an installment payment of $50,000 is due on or before May 31,
1997. The property is in excellent condition and continues to be well
maintained.
From the quarter ended March 31, 1997, non-interest expenses were $1,068,447
as compared to $870,822 during the first quarter of 1996, a 23% increase. Of
this amount, $551,616, or approximately 52%, was attributable to salary and
related employee benefits as compared to $435,063, or 50%,
<PAGE>
during the first quarter of 1996. The increase was primarily due to increased
staffing to accommodate the Bank's growth and its new branch which opened
August, 1996.
Interest expense of $1,009,988 represented 45% of gross interest income for
the three months ended March 31, 1997. Interest expense increased by 20% over
the same period in 1996. Even though the average cost of funds declined from
4.94% at March 31, 1996 to 4.81% at March 31, 1997, the increase in interest
expense rose due to interest bearing liabilities increasing from an average of
$68 million in 1996 to an average of $84 million in 1997, an average increase of
24%.
Occupancy expenses of $167,277 accounted for 16% of total non-interest
expenses in the first quarter of 1997 as compared to $126,342, or 15%, during
the first quarter of 1996. This 32% increase was due to expenses incurred to
open a new branch and the lease of additional space at the Bank's main office
for employee growth.
Equipment expenses of $56,893 for the quarter ended March 31, 1997
represented an increase of $11,923 from $44,970 for the first quarter of 1996.
The increase was a result of additional maintenance contracts on certain of the
Bank's equipment and additional equipment leases for the new branch and as a
result of employee growth.
Other operating expenses comprised primarily of advertising, business
development expenses, professional fees, data processing fees, printing and
supplies and Pennsylvania Shares Tax payments, during the quarter ended March
31, 1997 were $292,661, or approximately 27% of total non-interest expenses.
During the first quarter of 1996 other operating expenses were $264,447 or
approximately 30% of total expenses.
Income tax expense of $86,000 was provided for the quarter ended March 31,
1997. Income tax expense for the quarter ended March 31, 1996 was $79,060. The
slight increase in income tax expense is due to increased earnings.
Interest income on investment securities relates primarily to interest on
U.S. Government Obligations and municipal bonds. Interest income of $65,249 for
the quarter ended March 31, 1997, decreased 32% from $86,366 for the quarter
ended March 31, 1996. The decrease is a direct result of the change in liquidity
position of the Company. Secondary earning assets declined and a migration to
borrowed funds resulted as funding of asset growth outpaced the deposit growth
during the first quarter of 1997 as compared to the first quarter of 1996.
Interest income on temporary investments is comprised primarily of dividends
from investments in Federal Home Loan Stock. First quarter 1997 was
<PAGE>
$17,133 as compared to $6,909 first quarter 1996. The 148% increase was due
to increased investment in Federal Home Loan Bank Stock.
Interest income on temporary investments represents Federal Funds sold. At
March 31, 1997, interest income on Federal Funds sold was $23,657, as compared
to $38,878 at March 31, 1996, a 64% decrease. The decrease was a direct result
of the change in the Bank's liquidity position described above.
Total interest and fees on loans at March 31, 1997 was $2,155,773 compared
to $1,805,058 at March 31, 1996, representing a 19% increase. The Bank
experienced a 25% average loan growth while the yield on the portfolio decreased
from 10.05% to 9.49%. The decrease in rates from March, 1996 to March, 1997 had
little effect on earnings due to the ability of the bank to reprice liabilities
on a timely basis with market fluctuations and the increased loan growth.
RECENT DEVELOPMENTS
On April 29, 1997, subject to approval by the Pennsylvania Department of
Banking and the Federal Reserve Bank, the Company entered into an agreement of
sale with 8000 Verree Road Associates ("Verree Associates"), pursuant to which
the Company has agreed to purchase a property in northeast Philadelphia from
Verree Associates for use as a branch of the Bank.
<PAGE>
PART II--OTHER INFORMATION
ITEM 6 EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits Filed
<TABLE>
<CAPTION>
PAGE NUMBER IN
EXHIBIT NUMBER SEQUENTIAL NUMBERING SYSTEM
- ------------------- --------------------------------------------------------------------------------------------
<C> <S> <C>
2 None --
4 Amended and Restated Articles of Incorporation, as amended, and Amended and Restated Bylaws
of the Issuer *
10 Agreement of Sale dated April 29, 1997, by and between Madison Bancshares Group, Ltd. and
8000 Verree Road Associates
11 Not Applicable --
15 Not Applicable --
18 Not Applicable --
19 None --
20 None --
23 None --
24 None --
25 None --
27 Financial Data Schedule --
28 None --
</TABLE>
- -----------------
* Incorporated by reference from the Issuer's Registration Statement on Form S-1
No. 33-27146
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Issuer has duly caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.
Madison Bancshares Group, Ltd.
/s/ Vito A. DeLisi
-------------------------------
Vito A. DeLisi
Executive Vice President
/s/ E. Cheryl Hinkle
---------------------------------
E. Cheryl Hinkle
Vice President, Principal
Financial Officer
Date Executed: May 6, 1997
<PAGE>
AGREEMENT OF SALE
THIS AGREEMENT made this 29th day of April, 1997, by and between 8000
VERREE ROAD ASSOCIATES, a Pennsylvania partnership ("Seller") and MADISON BANK
SHARES GROUP, LTD., or its assignee or nominee (the "Purchaser").
W I T N E S S E T H:
1. Sale of Premises. Seller agrees to sell and convey to Purchaser, and
Purchaser agrees to purchase from Seller all that certain parcel of land situate
on the northwest corner of the intersection of Rhawn Street and Verree Road in
City of Philadelphia, Pennsylvania, known as 8000 Verree Road containing
approximately 20,000 +- square feet, as shown on the Site Plan dated June 27,
1994, last revised October 18, 1994 (the "Premises"), prepared by Architectural
Management, Inc., and approved pursuant to Philadelphia Department of Licenses
and Inspection, Permit No. 417725 which has been previously delivered to
Purchaser, permitting the construction of a two-story building with a 1,500
square foot first floor for use as a bank branch, 1,000 square foot second floor
offices, 1,500 square foot basement and parking lot for 25 cars ("Site Plan")
and all the right, title and interest of Seller in and to the following:
(a) options, rights, easements, rights-of-way, ways, waters,
privileges and appurtenances and rights to the same belonging to and/or inuring
to the benefit of the Seller and/or the Premises;
(b) any land lying in the beds of any street, road or avenue, opened
or proposed, in front of or adjoining said Premises; and
<PAGE>
(c) the Site Plan and all municipal, county, state and federal
permits, approvals and development agreements with respect to same.
2. Purchase Price.
(a) Price. The purchase price f or the Premises (the "Purchase
Price") shall be Two Hundred Fifty Thousand Dollars ($250,000.00).
(b) Payment. The Purchase Price shall be payable as follows:
(i) Twenty-five Thousand Dollars ($25,000.00) by Purchaser's
plain check upon execution hereof to be held in escrow as
set forth below; and
(ii) the balance at Closing in certified check, bank check, wire
transfer or title company check.
(c) Deposit. All monies to be paid by Purchaser in accordance with
Paragraph 2(b)(i) (the "Deposit") shall be placed and held in an
interest-bearing savings account by LaBrum & Doak (hereinafter "Escrow Holder")
and disbursed in accordance with the laws of the Commonwealth of Pennsylvania
and the provisions of this Agreement. At Closing, the Deposit and the interest
accrued thereon shall be applied on account of the Purchase Price.
3. Title.
(a) Condition. Title to the Premises shall be: (a) good and
marketable and free and clear of all liens, assessments, restrictions,
encumbrances, easements, leases, tenancies and covenants, and (b) insurable as
aforesaid at regular standard rates by a reputable title insurance company to be
selected by Purchaser, pursuant to an ALTA Owner's Policy of Title Insurance
Form B.
2
<PAGE>
(b) Defective Title. If title to the Premises cannot be conveyed to
Purchaser at the time and date of Closing hereunder in accordance with the
requirements of this Agreement for reasons currently unknown to Seller, then, in
addition to all other remedies provided by law, including the right to specific
performance, Purchaser shall have the option of:
(i) taking such title as Seller can cause to be conveyed with a
reasonable and appropriate abatement of the Purchase Price,
whereupon the parties hereto shall consummate this
transaction and the relevant provisions relating to the
condition of title shall be deemed waived by Purchaser; or
(ii) terminating this Agreement by giving written notice to
Seller, whereupon Escrow Agent shall return the Deposit plus
accrued interest thereon to Purchaser, and Seller shall
immediately reimburse Purchaser for all costs incurred by
Purchaser with respect to this transaction, including title
company fees, loan and/or mortgage application fees,
appraisal fees, legal fees, and expenses incurred for all
tests and studies. Upon payment of the foregoing, Purchaser
shall turn over to Seller plans, applications, studies,
permits and the like which it has obtained relating to the
Premises. Thereafter, this Agreement shall be null and void
and neither party shall have any further liability or
obligation hereunder.
4. Closing. Closing hereunder shall take place on or before sixty (60)
days from the date of this Agreement at the offices of Wisler, Pearlstine,
Talone, Craig, Garrity and Potash, LLP.
3
<PAGE>
If all conditions and contingencies set forth herein have not been satisfied
or waived by such date, Purchaser may, by written notice to Seller, extend
the Closing for an additional period of time in order to secure the
satisfaction of all such conditions but not to exceed 30 days.
5. Provisions with Respect to Closing. At Closing hereunder:
(a) Delivery by Seller. Seller shall deliver to Purchaser the
following:
(i) Deed. A special Warranty Deed to the Premises prepared by
Purchaser duly executed and acknowledged by Seller and in
proper recordable form.
(ii) Possession. Actual, sole and exclusive physical possession
of the Premises, unoccupied and free and clear of any
leases, claims to or rights of possession..
(iii) Title Company Affidavits. Such resolutions,
certificates or other documents as Purchaser's title
company shall require to evidence the due authorization
of the execution and performance of this Agreement and
the documents to be delivered pursuant hereto,
including the customary form of said title company's
Seller's Affidavit.
(iv) Agreements, Plans and Permits. All easement agreements,
development agreements, permits, evidence of approvals,
proof of payment of all required fees for use and
development of the Premises, executed assignments of all its
right, title and interest thereto.
4
<PAGE>
(v) Additional Instruments. Such further documents or
instruments in form suitable for recording, if appropriate,
as may be deemed reasonably necessary by Purchaser to
effectuate the provisions hereof.
(b) Transfer Taxes. All realty transfer taxes imposed on or arising
in connection with this transaction shall be borne equally by Seller and
Purchaser.
(c) Water and Sewer. Water and sewer rental (if any) and all other
apportionable charges shall be adjusted as of the date of Closing on a per them
basis, and such apportionments shall be made, where applicable, with relation to
the fiscal year of the taxing authority.
(d) Real Estate Taxes. All real estate taxes shall be adjusted as of
the date of Closing hereunder on a per them basis, and such apportionments shall
be made, where applicable, with relation to the fiscal year of the taxing
authority.
6. Delivery of Plans and Tests. Upon execution hereof Seller shall turn
over to Purchaser copies of all currently existing studies, plans, tests,
surveys and any other materials relevant to the physical condition of the
Premises which are in the possession of Seller or Seller's agents or
representatives.
7. Condemnation. Seller represents that it has not received any notice
of any condemnation proceedings or other proceedings in the nature of eminent
domain in connection with the Premises. In the event of the taking by eminent
domain proceedings of any part of the Premises which would preclude hinder or
render more costly the full completion by Purchaser of its planned development
of the Premises or upon the commencement of any such proceeding, at any time
prior to the time and date Closing is completed hereunder, Purchaser shall have
the right, at Purchaser"s
5
<PAGE>
sole option, to terminate this Agreement. If the Agreement is so terminated,
Escrow Agent shall return to Purchaser the Deposit plus interest, this
Agreement shall thereupon become null and void, and thereafter neither party
shall have any further liability or obligation hereunder. If Purchaser does
not so terminate this Agreement, the Purchase Price for the Premises shall be
reduced by the total of any awards or other proceeds received by Seller prior
to Closing with respect to any taking. At Closing, Seller shall assign to
Purchaser all rights of Seller in and to any other awards or proceeds payable
after Closing by reason of any taking. Seller agrees to notify Purchaser of
any eminent domain proceeding within five (5) days after Seller learns of any
such proceeding and, in order to exercise its right of termination, Purchaser
must so notify Seller within thirty (30) days after Purchaser receives such
notice.
8. Assessments. Seller shall be responsible to pay for all assessments
levied against the Premises on or before the date of this Agreement, or levied
against the Premises after the date of this Agreement by reason of work
commenced or completed on or before the date of this Agreement. If Closing is
completed hereunder by Purchaser, Purchaser shall be responsible to pay for all
assessments levied against the Premises after the date of this Agreement by
reason of work commenced after such date. However, if Closing does not take
place for any reason whatsoever, Purchaser shall have no liability or obligation
to pay for such assessments. If at the time and date of Closing hereunder, the
Premises, or any portion thereof, shall be affected by any assessments which is
required to be paid by Seller by the provisions of this paragraph and which is
or may be payable in annual or other installments of which the first installment
is then a lien or has been paid, then for the purpose of this Agreement, all of
the unpaid installments of any such assessments
6
<PAGE>
including those which become due and payable after Closing hereunder shall
be deemed to be due and payable and liened upon the Premises and shall be
paid and discharged by Seller at such Closing.
9. Seller's Warranties and Representations. Seller, to induce Purchaser
to enter into this Agreement and to purchase the Premises, warrants and
represents to Purchaser that the following matters are true as of the date
hereof and shall be true as of the date of Closing hereunder:
(a) There are no leases, tenancies, licenses or other rights of
occupancy or use for any portion of the Premises in effect as of the date of
this Agreement. Seller agrees not to enter into any lease, license or agreement
for the occupancy or use of any portion of the Premises after the date of this
Agreement without Purchaser's written consent.
(b) No assessments for public improvements have been made against the
Premises which remain unpaid and Seller has no knowledge and has received no
notice of any proposed assessment for public improvements or of any proposed
public improvements for which an assessment may be levied against the Premises.
(c) There are no outstanding violations of any federal, state, county
or municipal law, ordinance, order, regulation or requirement affecting any
portion of the Premises, and no written notice of any such violation has been
issued by any governmental or quasi-governmental authority. In the event that
any such notice is received by Seller after the date of this Agreement, Seller
shall promptly notify Purchaser and afford Purchaser full opportunity, with
Seller's cooperation, to contest such action or to initiate or participate in
such proceedings as Purchaser may deem necessary or desirable to protect
Purchaser's interests.
(d) There is no suit, action, or proceeding pending or threatened
against or affecting Seller or the Premises before or by any court,
administrative agency or other governmental
7
<PAGE>
or quasi-governmental authority, or which brings into question the validity
of this Agreement or this transaction or which could adversely affect title
to, or the development, use and enjoyment of, or value of the Premises.
(e) Seller has not engaged in any financing transaction which would
increase the real estate transfer taxes over the standard percentage due in a
real estate transfer.
(f) Seller has full power and authority to enter into and fulfill
Seller's obligations under this Agreement and the execution, delivery and
performance of this Agreement by the Seller constitutes a valid and binding
obligation of the Seller enforceable in accordance with its terms. No consent,
waiver, or approval by any other parties is required in connection with the
execution and delivery by the Seller of this Agreement or with the performance
by the Seller of its obligations hereunder or any instrument contemplated
hereby. The execution, delivery and performance by Seller of its obligations
under this Agreement will not conflict with or result in a breach of, or
constitute a default under, any of the provisions of any law, governmental rule,
regulations, judgment, decree or order by which the Seller is bound, or by any
of the provisions of any contract to which the Seller is a party or by which the
Seller is bound or, if Seller is not an individual, by the Seller's partnership
agreement or corporate charter or by-laws.
(g) This Agreement and Seller's obligations hereunder are legal,
valid and binding obligations of Seller, enforceable in accordance with their
terms, and there are no claims or defenses, personal or otherwise, or offsets
whatsoever to the enforceability or validity of this Agreement.
(h) The Premises is located in an R-5 District, and Seller knows of
no pending amendments to the pertinent sections of the zoning, subdivision or
development ordinances of City or County of Philadelphia ("City") as of the date
hereof.
8
<PAGE>
(i) Seller has not entered into any outstanding open space, "clean
and green", Act 515, Act 319 or any other pay-back agreements, covenants or
otherwise, applicable to or relating to the Premises. In the event Seller or
any predecessor in title has entered into any such agreements or covenants, all
roll-back taxes assessed against the Premises by virtue of the development or
Purchaser's intended use of the Premises and all interest and penalties shall be
borne by and be the responsibility of Seller and be paid at Closing.
(j) Except as may be delineated on the Site Plan, the Premises is not
located in a flood plain or other area designated by any governmental agency as
wetlands.
(k) Seller has as of the date of the Agreement, and will have as of
the date of the Closing, good, marketable and indefeasible title to the Premises
subject only to the matters set forth in this Agreement.
(l) To Seller's knowledge, there are no Hazardous Substances (as
defined below) stored, used or present in, or at the Premises. The Premises has
never been used by the Seller, or to Seller's knowledge, by any previous owners
or operators, to refine, produce, store, handle, transfer, process or transport
Hazardous Substances. To Seller's knowledge, there has been no Release (as
defined below), actual or threatened, of any Hazardous Substances by Seller or
any other party including owners or operators of adjacent property at on, over,
into, through or from the Premises. To Seller's knowledge, there has been no
Release of any Hazardous Substances for which Seller (or, to Seller's knowledge,
its predecessor in interest or successor in interest) is or may be liable.
Seller has not violated any Environmental Law in the use or occupancy of the
Premises. To Seller's knowledge, there have been no air emissions, or
discharges to surface waters or groundwaters, of Hazardous Substances which have
occurred prior to the date hereof. For purposes of this
9
<PAGE>
Agreement, each of the terms "Release", "Environmental Law" and "Hazardous
Substance" shall be defined as follows:
(i) "Hazardous Substance" means any substance presently listed,
defined, designated or classified hazardous, toxic,
radioactive or dangerous, or otherwise regulated, under any
Environmental Law, whether by type or by quantity, including
any material containing any such substance as a component.
Hazardous Substance include without limitation petroleum or
any derivative or by-product thereof, asbestos, radioactive
material, and polychlorinate biphenyls;
(ii) "Environmental Law" means any federal, state or local law,
statute, ordinance, rule, regulation, code license, permit,
authorization, approval, consent order, judgment, decree,
injunction or agreement by or with any governmental entity
relating to (1) 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 (2) the use, storage,
recycling, treatment, generation transportation, processing,
handling, labeling, production, release or disposal of
Hazardous Substances. The term Environmental Law includes
without limitation: (1) the Comprehensive Environmental
Response, Compensation and Liability Act, as amended, 42
U.S.C. Section 9601, et seq.; the Resource
10
<PAGE>
Conservation and Recovery Act, as amended, 42 U.S.C.
Section 6901, et seq.; the Clean Air Act, as amended, 42
U.S.C. Section 7401, et seq.; the Federal Water Pollution
Control Act, as amended, 33 U.S.C. Section 1251, et seq.;
the Toxic Substances Control Act, as amended 15 U.S.C.
Section 9601, et seq.; the Emergency Planning and
Community Right to Know Act, 42 U.S.C. Section 11001, et
seq.; the Safe Drinking Water Act, 42 U.S.C Section
300(f), et seq.; and all comparable state and local laws,
and (2) any common law (including without limitation
common law that may impose strict liability) that may
impose liability or obligations for injuries or damages
due to, or threatened as a result of, the presence of or
exposure to any Hazardous Substance;
(iii) "Release" means the releasing, spilling, leaking,
discharging, disposing, discarding or dumping of any
Hazardous Substance from, on, into or about the
Premises.
(m) To Seller's knowledge, there are no above ground or underground
storage tanks, vessels or related equipment or containers located on the
Premises that are subject to federal, state or local laws, statutes, rules,
regulations or ordinances.
(n) Seller has submitted plans to the City for the development of the
Premises as described on the Site Plan and on page 1 hereof. With respect
thereto, Seller makes the following warranties and representations:
(i) Seller has obtained final, irrevocable, unconditional,
uncontestable and unappealable approval from the City, and
11
<PAGE>
all other applicable federal, state and local governing
bodies or agencies ("Governmental Authorities"), for a
variance from R-5 zoning, with all appeal periods having
lapsed and no appeals pending, to lawfully develop the
Premises and construct the building, all as shown on the
Site Plan. Any conditions upon the Site Plan and to the
above-described approval by all Governmental Authorities
will be satisfied by Seller prior to Closing. The Site Plan
approval does not require the making of any off-site
improvements as a condition to the issuance of any building
permits. Notwithstanding the foregoing, it is understood
that Seller's approval expires after one (1) year from its
issuance date which was February 3, 1997 if Purchaser fails
to commence construction within such period.
(ii) At Closing, Seller shall assign to Purchaser, for no
additional consideration, all plans, permits, approvals and
easements which Seller has obtained and which relate to the
Premises and further, shall cooperate with Purchaser in
transferring any permits or approvals held in Seller's name
to Purchaser. Seller shall also fully cooperate with
Purchaser as necessary for Purchaser to secure all other
approvals and permits required, including the building
permit from all Governmental Authorities and shall provide
full and free access to the site as necessary therefor.
Seller warrants to Purchaser that no later than the date of
Closing all plans, permits and approvals related to the
12
<PAGE>
Premises shall have been paid for in full by Seller. This
warranty shall survive settlement.
(iii) Seller has paid all fees and costs associated with the
approvals described herein including reviewing and
engineering fees of Governmental Authorities, impact,
open space, park and recreation, sewer connection and
equivalent dwelling unit fees, contributions for traffic
devices and costs associated with public improvements and
has posted all required financial security.
(iv) If any Governmental Authority declares or effects (whether
it be a de jure, de facto or otherwise) any moratorium on,
or any other impediment to, the issuance or use of permits
required for construction of the building as described
above, or shall in any other way prohibit or impair
Purchaser in any respect f rom or render more costly the
construction of the building, and/or permitting the
occupancy of, any of the building, then Purchaser shall have
the right, at Purchaser's election, to extend all affected
election and/or performance dates as necessary or to
terminate this Agreement in whole or in part as to the
affected units. In the event this Agreement is terminated
pursuant to this paragraph, the Escrow Holder shall
immediately return the Deposit to the Purchaser.
(o) The representations and warranties set forth in this Agreement do
not contain any untrue statement of material fact or omit to state a material
13
<PAGE>
fact necessary in order to make such representations and warranties and
information, in light of the circumstances under which they have been made, not
misleading, and Seller has not withheld from Purchaser its knowledge of any
material fact or event that has occurred or is about to occur regarding the
Premises which has had or, so far as it can reasonably foresee, will have an
adverse affect on the Premises.
(p) Seller shall not enter into any agreement or contract affecting
the Premises nor shall Seller grant any easement or further encumber the
Premises without the prior written consent of the Purchaser.
(q) Seller knows of no impediment, restriction or circumstance which
would preclude or render unreasonably expensive or burdensome, the application
for or the pursuit or receipt of all required approvals and permits from all
Governmental Authorities for the development of the Premises as described in the
Site Plan or as such Site Plan is proposed to be modified by Madison.
10. Contingencies. Notwithstanding anything contained herein to the
contrary, Purchaser's obligation to close hereunder is contingent upon the
satisfaction of each of the following conditions, any of which may be waived by
Purchaser:
(i) This Agreement and the development and occupancy of the Premises
by Purchaser as described herein, has been approved by certain
regulatory agencies from whom Purchaser is required to seek
approval being the Commonwealth of Pennsylvania Department of
Banking and the Federal Reserve Board.
(ii) The approval, without the imposition of any additional
conditions, by all required Governmental Authorities of an
14
<PAGE>
amendment to the Site Plan to be filed by Purchaser at its cost,
changing the building to a one-story bank branch of at least
1,800 square feet with appropriate reduction in required parking.
(iii) The assignment of the Site Plan, all permits and approvals as
described above to Purchaser and the approval by City or the
appropriate Governmental Authority of Purchaser as the substitute
developer of the Premises, if required.
(iv) The receipt by Purchaser of all final, irrevocable,
unconditional, uncontestable and unappealable permits, licenses,
certificates and approvals including a building permit from all
Governmental Authorities, with all appeal periods having lapsed
and no appeals pending, to lawfully develop the Premises and
construct the building as described in the Site Plan, modified as
provided above.
(v) The receipt by Purchaser of all necessary easements, permits and
approvals to allow the connection of the proposed building to be
constructed upon the Premises with all required water, sanitary
sewer, storm sewer, gas, electric and other required utilities.
(vi) All the warranties and representations by Seller as set forth in
this Agreement shall be true and correct at and as of the Closing
date in all respects as though such warranties and
representations were made both at and as of the date of this
Agreement and at and as of the Closing date.
15
<PAGE>
(vii) No representation, statement or warranty by Seller contained
in this Agreement or in any exhibit attached hereto contains
or will contain any untrue statement or omits or will omit a
material fact necessary to make the statement of fact
therein recited not misleading.
(viii) Seller shall have performed, observed and complied with all
covenants, agreements and conditions required by this Agreement
to be performed, observed and complied with prior to or as of the
date of Closing.
(ix) Seller shall have complied with all the corporate formalities and
state law requirements required to execute this Agreement and
sell the Premises.
(x) None of the approvals or permits required by Purchaser as
described above shall be encumbered by any unreasonable,
burdensome or otherwise unacceptable conditions or require the
expenditure of monies in an amount deemed unacceptable by
Purchaser.
11. Indemnification. The Seller agrees to indemnify and hold harmless
Purchaser against any and all losses, costs, expenses, claims, damages or
liabilities (including the amount of any settlement and any expenses incurred in
enforcing this Agreement), which Purchaser may suffer, incur or become subject
to, and to reimburse Purchaser for any legal, engineering or other expenses
incurred by it in connection with the investigation of any claims and the
defense of any actions, insofar as such losses, costs, expenses, claims,
damages, liabilities or actions arise out of or are based upon (i) any false,
misleading or untrue warranty or representation, intentional or unintentional,
or the breach of any warranty or representation made by Seller; (ii) any breach
or default in performance by Seller of any of its covenants or agreements with
Purchaser contained herein; and
16
<PAGE>
(iii) any claims against the Purchaser with respect to the Premises for
expenses, costs, damages or contribution under any Environmental Law based on
any Release, presence or storage of Hazardous Substances which Release,
presence or storage occurred prior to Closing whether known or unknown to
Seller.
12. Seller's Default. Notwithstanding anything contained in this
Agreement to the contrary, in the event that Seller fails to close, or otherwise
fails to comply with its obligations hereunder the remedies of Purchaser shall
not be limited and Purchaser shall be entitled to such remedies as Purchaser may
have at law or in equity, including specific performance, and damages shall
include the amount of all expenses incurred by Purchaser in connection with the
proposed purchase, including, but not limited to, appraisal costs, engineering,
legal, accounting, consultant fees and survey costs and any other costs and
expenses incurred. In the event of default by Seller, Purchaser may require the
Escrow Agent to return the Deposit, and interest accrued thereon, to the
Purchaser in addition to any other remedies.
13. Purchaser's Default. Should Purchaser fail to complete Closing in
default of its obligations hereunder, after written notice and the expiration of
a 30-day cure period, the Deposit and all accrued interest thereon shall be paid
to Seller as liquidated damages (which shall be Seller's sole and exclusive
remedy). Upon such payment, this Agreement shall be null and void, and,
thereafter, neither party shall have any further liability or obligation
hereunder. In the event of a bona fide dispute between the parties hereto with
respect to the disposition of the Deposit, the Escrow Holder shall continue to
hold the Deposit until the issue 'is resolved by agreement or by court decision,
or the Escrow Holder may pay the Deposit over to a court of competent
jurisdiction.
17
<PAGE>
14. Notices. All notices, statements, demands, requests, consents,
communications and certificates from either party to the other shall be made in
writing and sent by United States certified mail, return receipt requested,
postage prepaid, or by express mail by reputable carrier, delivered to
addressee, addressed as follows:
To the Seller at: c/o Fasy Realtors
Third Street and Godfrey Avenue
Philadelphia, PA 19120
and
John Givnish
6401 Rising Sun Avenue
Philadelphia, PA 19111
With a copy to: James 0. Hausch, Esquire
1818 Market Street
Suite 2900
Philadelphia, PA 19103-3629
To the Purchaser at: Madison Bank
1767 Sentry Parkway West
Blue Bell, PA 19422
With a copy to: Michael O'Donoghue, Esquire
Wisler, Pearlstine, Talone,
Craig, Garrity & Potash, LLP
Office Court at Walton Point
484 Norristown Road
Blue Bell, PA 19422
or such other addresses either party may from time to time direct by service of
notice on the other party as provided above. All such notices shall be deemed
to have been sufficiently given for all purposes hereof on the date of proper
mailing thereof and may be given on behalf of either party by its counsel.
15. Waiver of Tender. Formal tender of an executed deed and 'the purchase
money are hereby waived.
18
<PAGE>
16. Assignment - Nominee. Purchaser shall be permitted to assign this
Agreement or any of its rights hereunder, or to name nominees to take title to
the Premises, or any portion or portions thereof; however, until Closing is
completed Purchaser shall remain liable for all provisions, conducts and
obligations imposed on Purchaser by this Agreement.
17. Brokerage. Seller and Purchaser represent and warrant that neither
has dealt with any broker, agent, finder or other intermediary who is entitled
to receive a commission or other. payment in connection with the conveyance of
the Premises under this Agreement and each agrees to indemnify and hold the
other harmless from any breach of this paragraph. Any commission owed to James
J. Reese Real Estate shall be paid by Seller at Closing.
18. Time of Essence. Time, wherever mentioned herein, shall be of the
essence of this Agreement.
19. Entire Agreement. This Agreement shall be binding upon and inure to
the benefit of Seller and Purchaser and their respective successors and/or
assigns. This is the entire Agreement between the parties hereto with respect
to the purchase and sale of the Premises and there are no other terms,
covenants, conditions, obligations, warranties, representations or
statements, oral or otherwise, of any kind whatsoever other than those which
are set forth herein. Any agreement hereafter made shall be ineffective to
change, modify, discharge or effect an abandonment of this Agreement in whole
or in part unless such agreement is in writing and signed by the party
against whom enforcement of the change, modification, discharge or
abandonment is sought. This Agreement may be executed in one or more
counterparts.
20. Survival of Warranties. Notwithstanding any presumption to the
contrary, all warranties, representations and conditions contained in this
19
<PAGE>
Agreement, which, by their nature, impliedly or expressly, involve performance,
in any particular, after Closing, or which cannot be ascertained to have been
fully performed until after Closing shall survive settlement and not merge into
the deed. This provision shall be effective as to all such warranties,
representations and conditions.
IN WITNESS WHEREOF, the parties have caused their duly authorized officers
or partners to duly execute this Agreement as of the day and year first above
written.
SELLER:
8000 VERREE ROAD ASSOCIATES
By:_____________________________________
________________________________________
PURCHASER:
MADISON BANK SHARES GROUP, LTD.
By:_____________________________________
20
<PAGE>
JOINDER BY ESCROW HOLDER
The Undersigned, as Escrow Agent hereunder, hereby acknowledges receipt of
the Deposit and agrees to hold it in accordance with the terms hereof.
__________________________________
21
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<PAGE>
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<NAME> MADISON BANCSHARES GROUP LTD.
<MULTIPLIER> 1,000
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<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
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