AGREEMENT Rebuttal of Rebuttable Determination of Control Under Part 574
AGREEMENT
Rebuttal of Rebuttable Determination of Control Under Part 574
- WHEREAS
- Xxxxxx X. Xxxxxx ("Xxxxxx"), individually, and as sole managing member of El Coronado Holdings,
L.L.C. ("ECH") and Trustee of the Xxxxx X. Xxxxxx Trust I, the Xxxxxx-Xxxxx Family Irrevocable Life Insurance
Trust, the Xxxxxxx X. Xxxxxx Trust, the Xxxxxxxxx X. Xxxxxx Trust, the Xxxxxxx X. Xxxxxx Trust, is the
beneficial owner of 342,147 shares (the "Shares") of the common stock, ($0.01 par value) (the "Stock") of
Monterey Bay Bancorp, Inc. ("MBBC"), 00 Xxxxxxx Xxxxxx, Xxxxxxxxxxx, Xxxxxxxxxx, 00000, which Shares represent
10.32 percent of a class of "voting stock" of MBBC as defined under the Acquisition of Control Regulations
("Regulations") of the Office of Thrift Supervision ("Office"), 12 C.F.R. 574 ("Voting Stock");
- MBBC is the holding company for Monterey Bay Bank ("Bank"). The Bank is a "savings
association" within the meaning of the Regulations;
- Austin seeks to acquire,
directly or through ECH, additional shares of stock of MBBC ("Additional
Shares"), such that Austin's, and possibly ECH's, ownership
thereof will exceed 10 percent of a class of Voting Stock but will not exceed 25
percent of a class of Voting Stock of MBBC; and Austin, and possibly ECH, is one
of the two largest shareholders of MBBC, which would constitute a "control
factor"; as defined in the Regulations ("Control Factor");
- Austin does not seek to acquire the Additional Shares or an additional Control Factor for the
purpose or effect of changing the control of MBBC or in connection with or as a participant in any transaction
having such purpose or effect;
- The Regulations require
a company or a person who intends to hold 10 percent or more but not in excess
of 25 percent of any class of Voting Stock of a savings association or holding
company thereof and that also would possess any of the Control Factors specified
in the Regulations, to file and obtain approval of an application
("Application") under the Savings and Loan Holding Company Act
("Holding Company Act"), 12 U.S. C. 1467a, or file and obtain
clearance of a notice ("Notice") under the Change in Control Act
("Control Act"), 12 U.S.C. 1817(j), prior to acquiring such amount of
stock and a Control Factor unless the rebuttable determination of control has
been rebutted;
- Under the Regulations, Austin (with respect to the Control Act) and ECH (with respect to the
Holding Company Act) would be determined to be in control, subject to rebuttal, of MBBC upon acquisition of the
Additional Shares;
- Austin has no intention to manage or control, directly or indirectly through ECH or otherwise,
MBBC;
- Austin has caused to be
submitted on or about October 30, 2000, a written statement on behalf of himself
and ECH seeking to rebut the determination of control, attached hereto and
incorporated by reference herein, (this submission referred to as the
"Rebuttal"), which submission is joined in by Xxxxx X. Xxxxxx, the
spouse of Austin (Austin, ECH and Xxxxx X. Xxxxxx are collectively referred to
as "Applicants");
- In order to rebut the rebuttable determination of control, Applicants agree to offer this Agreement as evidence that the acquisition of the Additional Shares as proposed would not constitute an acquisition of control under the Regulations.
- The Office has determined, and hereby agrees, to act favorably on the Rebuttal, and in consideration of such a determination and agreement by the Office to act favorably on the Rebuttal, Applicants, and any other existing, resulting or successor entities of Applicants, agree with the Office that:
- Unless Austin shall have filed a Notice under the Control Act, or, in the case of ECH an Application under the Holding Company Act, as appropriate, and either shall have obtained approval of the Application or clearance of the Notice in accordance with the Regulations, Applicants will not, except as expressly permitted otherwise herein or pursuant to an amendment to this Rebuttal Agreement:
- Seek or accept representation of more than one member of the board of directors of MBBC or the
Bank;
- Have or seek to have any representative serve as the chairman of the board of directors, or
chairman of an executive or similar committee of the Bank's or MBBC's board of directors or as president or chief
executive officer of the Bank or MBBC;
- Engage in any intercompany transaction with MBBC or the MBBC's affiliates;
- Propose a director in opposition to nominees proposed by the management of the Bank or MBBC for
the board of directors of the Bank or MBBC other than as permitted in paragraph A-1;
- Solicit proxies or participate in any solicitation of proxies with respect to any matter
presented to the stockholders of MBBC other than in support of, or in opposition to, a solicitation conducted on
behalf of management of MBBC;
- Do any of the following, except as necessary solely in connection with Austin's performance of duties as a member of Bank or MBBC's board of directors:
- Influence or attempt to influence in any respect the loan and credit decisions or policies of
the Bank or MBBC, the pricing of services, any personnel decisions, the location of any offices, branching, the
hours of operation or similar activities of the Bank or MBBC;
- Influence or attempt to influence the dividend policies and practices of the Bank or MBBC or
any decisions or policies of the Bank or MBBC as to the offering or exchange of any securities;
- Seek to amend, or otherwise take action to change, the bylaws, articles of incorporation, or
charter of the Bank or MBBC;
- Exercise, or attempt to exercise, directly or indirectly, control or a controlling influence
over the management, policies or business operations of the Bank or MBBC; or
- Seek or accept access to any non-public information concerning the Bank or MBBC.
- None of Applicants is a party to any agreement with the Bank or MBBC.
- Applicants shall not
assist, aid or abet any of their affiliates or associates that are not parties
to this Agreement to act, or act in concert with any person or company, in a
manner which is inconsistent with the terms hereof or which constitutes an
attempt to evade the requirements of this Agreement.
- Any amendment to this Agreement shall only be proposed in connection with an amended rebuttal
filed by Applicants with the Office for its determination;
- Prior to acquisition of
any shares of "Voting Stock" of MBBC as defined in the Regulations in
excess of the Additional Shares, any required filing will be made by Austin
under the Control Act or, in the case of ECH, the Holding Company Act and either
approval of the acquisition under the Holding Company Act shall be obtained from
the Office or any Notice filed under the Control Act shall be cleared in
accordance with the Regulations;
- At any time during which
10 percent or more of any class of Voting Stock of MBBC is owned or controlled
by Applicants, no action which is inconsistent with the provisions of this
Agreement shall be taken by Applicants until Austin or ECH, as appropriate,
files and either obtains from the Office a favorable determination with respect
to either an amended rebuttal, approval of an Application under the Holding
Company Act, or clearance of a Notice under the Control Act, in accordance with
the Regulations.
- Where any amended
rebuttal filed by Applicants is denied or disapproved, Applicants shall take no
action which is inconsistent with the terms of this Agreement, except after
either (1) reducing the amount of shares of Voting Stock of MBBC owned or
controlled by Applicants to an amount under 10 percent of a class of Voting
Stock or immediately ceasing any other actions that give rise to a conclusive or
rebuttable determination of control under the Regulations; or (2) in the case of
Austin, filing a Notice under the Control Act, or in the case of ECH, an
Application under the Holding Company Act, as appropriate, and either obtaining
approval of the Application or clearance of the Notice, in accordance with the
Regulations.
- Where any Application or
Notice filed by Austin or ECH is disapproved, Applicants shall take no action
which is inconsistent with the terms of this Agreement, except after reducing
the amount of shares of Voting Stock of MBBC owned or controlled by Applicants
to an amount under 10 percent of any class of Voting Stock, or immediately
ceasing any other actions that give rise to a conclusive or rebuttable
determination of control under the Regulations.
- Should circumstances
beyond Austin's control result in Austin being placed in a position to
direct the management or policies of the Bank or MBBC, then Austin shall either
(1) in the case of ECH, promptly file an Application under the Holding Company
Act or, in the case of Austin, a Notice under the Control Act, as appropriate,
and take no affirmative steps to enlarge that control pending either a final
determination with respect to the Application or Notice, or (2) promptly reduce
the amount of shares of MBBC Voting Stock owned or controlled by Applicants to
an amount under 10 percent of any class of Voting Stock or immediately cease any
actions that give rise to a conclusive or rebuttable determination of control
under the Regulations.
- By entering into this
agreement and by offering it for reliance in reaching a decision on the request
to rebut the presumption of control under the Regulations, as long as 10 percent
or more of any class of Voting Stock of MBBC is owned or controlled, directly or
indirectly, by Applicants, and Applicants possesses any Control Factor as
defined in the Regulations, Applicants will submit to the jurisdiction of the
Regulations, including (1) the filing of an amended rebuttal or Application or
Notice for any proposed action which is prohibited by this Agreement, and (2)
the provisions relating to a penalty for any person who willfully violates or
with reckless disregard for the safety or soundness of a savings association
participates in a violation of the Holding Company Act or Control Act and the
Regulations thereunder, and any regulation or order issued by the Office.
- Any violation of this Agreement shall be deemed to be a violation of the Holding Company Act or Control Act and the Regulations, and shall be subject to such remedies and procedures as are provided in the Holding Company Act or Control Act and the Regulations for a violation thereunder and in addition shall be subject to any such additional remedies and procedures as are provided under any such applicable statutes or regulations for a violation, willful or otherwise, of any agreement entered into with the Office.
- This Agreement may be
executed in one or more counterparts, each of which shall be deemed an original
but all of which counterparts collectively shall constitute one instrument
representing the Agreement among the parties thereto. It shall not be necessary
that any one counterpart be signed by all of the parties hereto as long as each
of the parties has signed at least one counterpart.
- This Agreement shall be interpreted in a manner consistent with the provisions of the Rules and
Regulations of the Office.
- This Agreement shall
terminate upon (i) the approval by the Office of ECH's Application under
the Holding Company Act or clearance by the Office of Austin's Notice under
the Control Act to acquire MBBC, and consummation of the transaction as
described in such Application or Notice, (ii) the disposition by Austin or ECH
of a sufficient number of shares of MBBC, or (iii) the taking of such other
action that thereafter Austin and ECH are not in control and would not be
determined to be in control of MBBC under the Control Act, the Holding Company
Act or the Regulations of the Office as in effect at that time.
- IN WITNESS THEREOF, the parties hereto have executed this Agreement by their duly authorized officer.
XXXXXX X. XXXXXX
EL XXXXXXXX HOLDINGS, LLC
By: Xxxxxx X. Xxxxxx, Sole Managing Member
XXXXX X. XXXXXX
OFFICE OF THRIFT SUPERVISION
By:
Date:
