Board of Directors
EverTrust Financial Group, Inc.
2707 Colby Avenue
Suite 600
Everett, Washington 98201
Members of the Board:
The notice of proposed mutual-to-stock conversion and subsequent amendments thereto, filed on behalf of Mutual Bancshares, Everett, Washington, now known as EverTrust Financial Group, Inc., ("EFG") have been reviewed by the Federal Deposit Insurance Corporation ("FDIC") pursuant to Section 303.161 of the FDIC Rules and Regulations. As described in the notice and amendments, EFG proposes to convert from a Washington-chartered mutual holding company to a Washington-chartered stock holding company. Stock of EFG will be offered for sale in conjunction with the transaction. Mutual Bancshares was formed in 1993 as a holding company as part of the mutual-to-stock conversion of Everett Mutual Bank ("EMB"), Everett, Washington. In anticipation of this proposed transaction, Mutual Bancshares changed its name to EverTrust Financial Group, Inc. EFG owns, in addition to EMB, the Commercial Bank of Everett, Everett, Washington; I-Pro, Inc., Kent, Washington; and Mutual Bancshares Capital, Inc., Bothell, Washington. As part of the conversion, it is our understanding that EFG will create a second charitable foundation, The EverTrust Foundation ("Foundation") with common stock and cash contributed by the holding company.
The FDIC has relied on information provided in EFG's notice of conversion and the accompanying business plan in reaching its decision. It is anticipated that notification of any planned material deviations from the business plan, such as a return of capital, will be provided to the FDIC in advance of the event. Based on the information presented in EFG's notice of conversion, as amended, the FDIC plans to issue a letter of nonobjection to the proposed conversion transaction, provided that EFG satisfies the following conditions:
1. The Foundation's organizers committing to the following oversight provisions:
(a) Common stock of EFG held by the Foundation shall be voted by the Foundation at the same ratio as all other shares voted on each and every proposal considered by the stockholders of EFG;
(b) The Foundation shall be subject to examination by the FDIC;
(c) The Foundation shall comply with all supervisory directives imposed by the FDIC;
(d) The Foundation shall operate in accordance with written policies adopted by the Foundation's board of directors, including adopting a conflict of interest policy acceptable to the FDIC; and
(e) The Foundation shall provide a proposed operating plan prior to conversion and annual reports to the FDIC describing the grants made and grant recipients.
2. EFG must provide written evidence that its Plan of Conversion has been approved by the affirmative vote of a majority of the total votes eligible to be cast at the special meeting.
3. EFG must receive all relevant final approvals from the State of Washington, Department of Financial Institutions, Division of Banks; the Federal Reserve Bank of San Francisco; and/or the Federal Reserve Board of Governors.
4. EFG must submit final disclosure materials acceptable to the FDIC Division of Supervision, Registration and Disclosure Section.
5. EFG must advise this office of the results of the subscription offering and deliver an updated appraisal that:
(a) Takes the results of the subscription offering into account;
(b) Discusses any material occurrences during the subscription period; and
(c) Explains any orders that may have been rejected.
Provided that EFG meets the foregoing conditions and that the FDIC is satisfied with the appraiser's determination in the updated appraisal that the results of the subscription offering represent fair value for EFG, and provided further that there has been no significant alteration to the terms of the conversion transaction (by action of other regulators or otherwise) subsequent to the date of this letter, the FDIC will issue a letter of non-objection to the proposed conversion transaction.
Sincerely,
James L. Sexton
Director
Board of Directors
EverTrust Financial Group, Inc.
2707 Colby Avenue
Suite 600
Everett, Washington 98201
Members of the Board:
The notice of proposed mutual-to-stock conversion and subsequent amendments thereto, filed on behalf of Mutual Bancshares, Everett, Washington, now known as EverTrust Financial Group, Inc., ("EFG") have been reviewed by the Federal Deposit Insurance Corporation ("FDIC") pursuant to Section 303.161 of the FDIC Rules and Regulations. As described in the notice and amendments, EFG proposes to convert from a Washington-chartered mutual holding company to a Washington-chartered stock holding company. Stock of EFG will be offered for sale in conjunction with the transaction. Mutual Bancshares was formed in 1993 as a holding company as part of the mutual-to-stock conversion of Everett Mutual Bank ("EMB"), Everett, Washington. In anticipation of this proposed transaction, Mutual Bancshares changed its name to EverTrust Financial Group, Inc. EFG owns, in addition to EMB, the Commercial Bank of Everett, Everett, Washington; I-Pro, Inc., Kent, Washington; and Mutual Bancshares Capital, Inc., Bothell, Washington. As part of the conversion, it is our understanding that EFG will create a second charitable foundation, The EverTrust Foundation ("Foundation") with common stock and cash contributed by the holding company.
The FDIC has relied on information provided in EFG's notice of conversion and the accompanying business plan in reaching its decision. It is anticipated that notification of any planned material deviations from the business plan, such as a return of capital, will be provided to the FDIC in advance of the event. Based on the information presented in EFG's notice of conversion, as amended, the FDIC plans to issue a letter of nonobjection to the proposed conversion transaction, provided that EFG satisfies the following conditions:
1. The Foundation's organizers committing to the following oversight provisions:
(a) Common stock of EFG held by the Foundation shall be voted by the Foundation at the same ratio as all other shares voted on each and every proposal considered by the stockholders of EFG;
(b) The Foundation shall be subject to examination by the FDIC;
(c) The Foundation shall comply with all supervisory directives imposed by the FDIC;
(d) The Foundation shall operate in accordance with written policies adopted by the Foundation's board of directors, including adopting a conflict of interest policy acceptable to the FDIC; and
(e) The Foundation shall provide a proposed operating plan prior to conversion and annual reports to the FDIC describing the grants made and grant recipients.
2. EFG must provide written evidence that its Plan of Conversion has been approved by the affirmative vote of a majority of the total votes eligible to be cast at the special meeting.
3. EFG must receive all relevant final approvals from the State of Washington, Department of Financial Institutions, Division of Banks; the Federal Reserve Bank of San Francisco; and/or the Federal Reserve Board of Governors.
4. EFG must submit final disclosure materials acceptable to the FDIC Division of Supervision, Registration and Disclosure Section.
5. EFG must advise this office of the results of the subscription offering and deliver an updated appraisal that:
(a) Takes the results of the subscription offering into account;
(b) Discusses any material occurrences during the subscription period; and
(c) Explains any orders that may have been rejected.
Provided that EFG meets the foregoing conditions and that the FDIC is satisfied with the appraiser's determination in the updated appraisal that the results of the subscription offering represent fair value for EFG, and provided further that there has been no significant alteration to the terms of the conversion transaction (by action of other regulators or otherwise) subsequent to the date of this letter, the FDIC will issue a letter of non-objection to the proposed conversion transaction.
Sincerely,
James L. Sexton
Director
