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EXHIBIT 10.4
SHAREHOLDERS' AGREEMENT OF
HANOVER CAPITAL PARTNERS LTD.
THIS SHAREHOLDERS' AGREEMENT OF HANOVER CAPITAL PARTNERS LTD. (the
"Agreement"), dated as of the ___ day of ___________, 1997 (the "Effective
Date"), is entered into by and among (i) Hanover Capital Partners Ltd., a New
York corporation having its principal place of business at 00 Xxxx Xxxxxx, Xxxxx
0000, Xxx Xxxx, Xxx Xxxx 00000 (the "Company"), (ii) Hanover Capital Mortgage
Holdings, L.P., a Delaware limited partnership having its principal place of
business at 000 Xxxxxxxxx Xxxxx, Xxxxx 000, Xxxxxx, XX 00000 (the
"Partnership"), (iii) Xxxx X. Xxxxxxxx ("Xxxxxxxx"), (iv) Xxxxx X. Xxxxxxx
("Xxxxxxx"), (v) Xxxxxx X. Xxxxxxxxx ("Xxxxxxxxx") and (vi) Xxxx X. Xxxxxxx
("Xxxxxxx"). Burchett, Mizerak, Xxxxxxxxx and Xxxxxxx are collectively referred
to as the "Initial Shareholders."
RECITALS
A. The Company and the Initial Shareholders entered into an Agreement
of Shareholders, dated as of May 26, 1992 (the "Original Agreement"), which they
amended and restated pursuant to an Amended and Restated Shareholders' Agreement
of Hanover Capital Partners Ltd. dated as of January 1, 1996 (the "First Amended
Agreement").
B. Pursuant to an Agreement and Plan of Recapitalization dated as of
__________, 1997 (the "Plan of Recapitalization"), the Initial Shareholders
exchanged 166.424 shares of the Company's Class A Common Stock, $.01 par value
per share, constituting all of the issued and outstanding shares of the
Company's Class A Common Stock, for 3,000 shares of the Company's Class A Common
Stock, $.01 par value per share (the "Common Shares"), and 97,000 shares of the
Company's Series A Preferred Stock, $.01 par value per share (the "Preferred
Shares").
C. Pursuant to the Amended and Restated Agreement of Limited
Partnership of Hanover Capital Mortgage Holdings, L.P., dated as of ___________,
1997 (the "Partnership Agreement"), the Initial Shareholders contributed all of
the Preferred Shares to the Partnership in exchange for units of partnership
interest in the Partnership.
D. The Initial Shareholders and the Partnership hold the Common Shares
and Preferred Shares, respectively, set forth opposite their names on the
attached SCHEDULE 1.
E. The Company, the Partnership and the Initial Shareholders desire to
amend and restate the First Amended Agreement in its entirety in an effort to
ensure that (i) Hanover Capital Mortgage Holdings, Inc., a Maryland corporation
("HCHI") and the general partner of the Partnership, maintains its qualification
as a real estate estate investment trust ("REIT") for Federal income tax
purposes, and (ii) the Common Shares continue to be owned by persons whose
interests coincide with the interests of HCHI and the Partnership to the extent
provided in this Agreement. The Original Agreement and the First Amended
Agreement have been superseded in every respect by this Agreement.
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AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants contained in
this Agreement and for other valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties to this Agreement hereby agree
that the Original Agreement and the First Amended Agreement shall be amended and
restated as follows:
1. DEFINITIONS. For purposes of this Agreement, the following
terms shall be defined as follows:
AFFILIATE. "Affiliate" shall mean, with respect to any Person, any
other Person directly or indirectly controlling, controlled by or under common
control with such Person.
CLASS B SHAREHOLDER. "Class B Shareholder" shall mean any holder of
Class B Shares.
CLASS B SHARES. "Class B Shares" shall mean shares of the Company's
Class B Common Stock, $.01 par value, that the Company may be authorized to
issue from time to time and any other securities of the Company for which such
Class B Shares may be exchanged (by way of reorganization, recapitalization,
merger, consolidation or otherwise).
COMMON SHAREHOLDER. "Common Shareholder" shall mean any holder of
Common Shares.
COMMON SHARES. "Common Shares" shall mean shares of the Company's Class
A Common Stock, $.01 par value, that the Company may be authorized to issue from
time to time, any other securities of the Company for which such Common Shares
may be exchanged (by way of reorganization, recapitalization, merger,
consolidation or otherwise) and shall also include any shares of common stock of
the Company (other than Class B Shares) hereafter authorized and of any capital
stock of the Company of any other class (except Class B Shares) hereafter
authorized which is not preferred as to dividends or distribution of assets in
liquidation over any other class of capital stock of the Company or which has
ordinary voting power for the election of directors of the Company.
CONTROL. "Control" (including the terms "controlling," "controlled by,"
and "under common control with") shall mean the direct or indirect possession of
the power to direct or cause the direction of the management and policies of a
Person, corporation, partnership, limited liability company or other entity,
whether through the ownership of voting securities, by contract, or otherwise.
EVENT OF BANKRUPTCY. With respect to any Person, "Event of Bankruptcy"
shall mean any of the following events:
(a) the making by such Person of an assignment for the benefit
of creditors;
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(b) the filing by such Person of a voluntary petition under
any bankruptcy, insolvency or similar law which is not dismissed within ninety
(90) days after the filing thereof;
(c) the adjudication of such Person by a court of competent
jurisdiction as a bankrupt or insolvent, or the entry against such Person of an
order for relief under any bankruptcy, insolvency or similar proceeding within
ninety (90) days after the filing thereof;
(d) the filing by such Person of a petition or answer seeking
for himself or herself any reorganization, arrangement, composition,
readjustment, liquidation, dissolution or similar relief under any bankruptcy or
insolvency statute, law or regulation;
(e) the filing by such Person of an answer or other pleading
admitting or failing to contest the material allegations of a petition filed
against him or her in any bankruptcy or insolvency proceeding;
(f) such Person's written request for, consent to or
acquiescence in the appointment of a trustee, receiver or liquidator of such
Person or of all or any substantial part of such Person's properties; or
(g) the passage of (i) one hundred twenty (120) days after the
commencement of any proceeding against such Person seeking reorganization,
arrangement, composition, readjustment, liquidation, dissolution or similar
relief under any bankruptcy or insolvency statute, law or regulation without
such proceeding having been dismissed, (ii) ninety (90) days after the
appointment, without such Person's consent or acquiescence, of a trustee,
receiver or liquidator of such Person or of all or any substantial portion of
such Person's properties without such appointment having been vacated or stayed,
or (iii) ninety (90) days after the expiration of any stay of an appointment
referred to in the foregoing clause (ii) without such appointment having been
vacated.
GROSS COMPANY VALUE. "Gross Company Value" shall mean, as of any date
of determination for as long as the Partnership (or HCHI) holds a majority of
the Preferred Shares, (a) the "Gross Asset Value," as reasonably and in good
faith determined by HCHI's Board of Directors in accordance with the Partnership
Agreement, of the Shares held by the Partnership (or HCHI) as of such date
divided by (b) a fraction, the numerator of which is the number of Shares held
by the Partnership (or HCHI) as of such date and the denominator of which is the
number of Shares that are outstanding as of such date. For as long as it holds
Shares, the Partnership (or HCHI) shall provide the other Shareholders with
statements of the Gross Asset Value of the Shares held by it in response to
reasonable written requests by such other Shareholders therefor. If neither the
Partnership nor HCHI holds a majority of the Preferred Shares as of the date of
determination, the Gross Company Value shall be the aggregate value of all of
the Shares as determined as provided in Section 3(g) of this Agreement.
IMMEDIATE FAMILY. "Immediate Family" shall mean, with respect to any
natural Person, (a) such Person's current or former spouse, descendants (by
blood or adoption), parents, parents-
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in-law, siblings and descendants of siblings (by blood or adoption) and (b) any
trust all of the beneficiaries of which consist of such Person and/or Persons
included in (a) immediately above.
OPTION EVENT. "Option Event" shall mean, with respect to any Common
Shareholder (other than the Partnership, HCHI or any Affiliate or Subsidiary of
the Partnership or HCHI), any of the following events:
(a) in the case of an Initial Shareholder, any event following
which (i) such Initial Shareholder is not employed by at least one of HCHI, the
Partnership, the Company and their respective Affiliates and Subsidiaries (in
the case of disability, for a period of at least two (2) consecutive months or a
total of sixty (60) days during any twelve-month period due to a condition that,
in the opinion of a physician who is mutually acceptable to the Company, the
Partnership and such Initial Shareholder or his or her legal representatives, is
likely to continue for at least one year from the time of inception) or (ii)
neither such Initial Shareholder nor a member of the Immediate Family or an
Affiliate of such Initial Shareholder owns an equity interest in HCHI or the
Partnership;
(b) an Event of Bankruptcy with respect to such Common
Shareholder;
(c) the death of such Common Shareholder;
(d) the agreement by, or requirement of, such Common
Shareholder to transfer all or any portion of his or her Common Shares to a
spouse or former spouse in connection with a legal separation or dissolution of
marriage;
(e) the Transfer of all or any portion of such Common
Shareholder's Common Shares by operation of law; or
(f) in the case of a Common Shareholder who was a member of
the Immediate Family or an Affiliate of an Initial Shareholder upon acquiring
his, her or its Common Shares, (i) any event described in subparagraph (a)
immediately above with respect to such Initial Shareholder or (ii) any event
that causes such Common Shareholder to no longer be a member of the Immediate
Family or an Affiliate of such Initial Shareholder.
OPTION EVENT VALUE. "Option Event Value" shall mean the value (per
share) of the Common Shares of a Common Shareholder who suffers an Option Event
determined by dividing (a) the Gross Company Value as of the date of such Option
Event by (b) the total number of outstanding Shares as of the date of such
Option Event.
PERMITTED TRANSFER. A "Permitted Transfer" shall mean a Transfer of
Common Shares by a Common Shareholder (a) to (i) a member of such Common
Shareholder's Immediate Family, (ii) an Affiliate of such Common Shareholder, or
(iii) another Shareholder, or (b) with the consent, in writing, of Shareholders
holding a majority of the issued and outstanding Shares (not held by such Person
or Affiliates of such Person).
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No Permitted Transfer shall be effective unless and until the Permitted
Transferee of the Common Shares so transferred executes and delivers to the
Company an executed counterpart of this Agreement, which shall evidence such
Permitted Transferee's agreement that the Common Shares intended to be
transferred shall continue to be subject to this Agreement and that as to such
Common Shares the Permitted Transferee shall be bound by the restrictions of
this Agreement.
PERSON. "Person" shall mean any individual or any corporation,
partnership, trust, limited liability company or other entity.
PREFERRED SHAREHOLDER. "Preferred Shareholder" shall mean any holder of
Preferred Shares.
PREFERRED SHARES. "Preferred Shares" shall mean shares of the Company's
Series A Preferred Stock, $.01 par value, that the Company may be authorized to
issue from time to time, any other securities of the Company for which such
Preferred Shares may be exchanged (by way of reorganization, recapitalization,
merger, consolidation or otherwise) and shall also include any shares of capital
stock of the Company hereafter authorized which are not Common Shares or Class B
Shares.
SHAREHOLDER. "Shareholder" shall mean any Common Shareholder, Class B
Shareholder or Preferred Shareholder.
SHARES. "Shares" shall mean any Common Shares, Class B Shares or
Preferred Shares.
SUBSIDIARY. "Subsidiary" with respect to any entity (the "parent")
shall mean any corporation, partnership, limited liability company, firm,
association, trust or other entity of which such parent, at the time in respect
of which such term is used, (a) owns directly or indirectly more than 50% of the
equity or beneficial interest, on a consolidated basis, or (b) owns directly or
indirectly more than 50% of the shares of capital stock or beneficial interest
having the power to vote for the election of directors, trustees, managers or
other officials having powers analogous to those of directors of a corporation.
Unless otherwise specifically indicated, when used herein the term Subsidiary
shall refer to a direct or indirect Subsidiary.
TRANSFER. "Transfer" shall mean to transfer, sell, assign, pledge,
hypothecate, give, create a security interest in or lien on, place in trust
(voting or otherwise), assign or in any other way encumber or dispose of,
directly or indirectly and whether or not by operation of law or for value, any
Shares.
2. RESTRICTIONS ON TRANSFER OF COMMON SHARES. Except as otherwise
provided in this Agreement, no Common Shareholder (other than the Partnership,
HCHI or any Affiliate or Subsidiary of the Partnership or HCHI) may Transfer all
or any part of the Common Shares owned by him or her other than by a Permitted
Transfer without complying with the following procedures:
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(a) NOTICE TO COMPANY AND OTHER SHAREHOLDERS. If at any time a
Common Shareholder (other than the Partnership, HCHI or any Affiliate or
Subsidiary of the Partnership or HCHI) (the "Offeror") desires or otherwise
proposes to Transfer Shares to any Person other than by a Permitted Transfer (a
"Third Party Offeree"), such Offeror shall give notice of such Transfer (the
"Transfer Notice") to the Company, the other Common Shareholders (the "Common
Offerees") and the Preferred and Class B Shareholders (collectively, the
"Preferred Offerees"). The Transfer Notice shall include the terms and
conditions of such Transfer, including the name of the Third Party Offeree, the
proposed purchase price, if any, per share of such Shares (the "Offer Price"),
the payment terms (including a description of any proposed non-cash
consideration), and the type of disposition and the number of such Shares to be
transferred (the "Offered Shares"). The Transfer Notice shall further state that
the Company, the Common Offerees and the Preferred Offerees may acquire, in
accordance with the provisions of this Agreement, any of the Offered Shares for
the Offer Price and upon the other terms and conditions set forth in the
Transfer Notice; PROVIDED, that if such Transfer does not involve a sale, the
Offer Price for purposes of this Section 2 shall be the Option Event Value of
such Offered Shares as of the date of the Transfer Notice.
(b) COMPANY'S RIGHT OF FIRST REFUSAL. For a period of twenty
(20) days from the receipt of the Transfer Notice (the "Company Offer Period"),
the Company may, by written notice to the Offeror, the Common Offerees and the
Preferred Offerees, elect to purchase all or any portion of the Offered Shares
at the Offer Price per share.
(c) COMMON OFFEREES' RIGHT OF FIRST REFUSAL. If the Company
does not elect to purchase all of the Offered Shares, the Common Offerees shall
have a period of ten (10) additional days beyond the Company Offer Period (the
"Common Offer Period") to elect, by written notice to the Offeror, to purchase
the Offered Shares not purchased by the Company (the "Refused Shares") at the
Offer Price per share in such proportions as they may agree upon. If the Common
Offerees are unable to agree within the Common Offer Period on the proportions
in which they will purchase the Refused Shares, each of the Common Offerees
shall be entitled to purchase his or her PRO RATA portion (based on the number
of Common Shares such Common Offeree owns in relation to the total number of
Common Shares owned by all of the Common Offerees) of the Refused Shares not
purchased by the Company by notifying the Offeror in writing, within an
additional ten (10) day period after the close of the Common Offer Period and
with copies to the Company and the other Shareholders, of his or her election to
make such purchase. The Common Offerees shall have a right of oversubscription
such that if any Common Offeree does not elect to purchase his or her PRO RATA
portion of the Refused Shares, the other Common Offerees shall, among them, have
the right to purchase up to the balance of the Refused Shares not so purchased.
Such right of oversubscription may be exercised by a Common Offeree by
specifying in his or her notice to the Offeror his or her election to purchase
more than his or her PRO RATA portion of the Refused Shares. If, as a result
thereof, such oversubscriptions exceed the number of Refused Shares available in
respect of such oversubscription privilege, the oversubscribing Common Offerees
shall be reduced with respect to their oversubscriptions in accordance with
their respective PRO RATA portions of the Refused Shares.
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(d) PREFERRED OFFEREES' RIGHT OF FIRST REFUSAL. If the Company
and the Common Offerees do not elect to purchase all of the Offered Shares, the
Preferred Offerees shall have a period of ten (10) additional days beyond the
Common Offer Period (plus any extensions thereof) (the "Preferred Offer Period")
to elect, by written notice to the Offeror, to purchase the Refused Shares not
purchased by the Common Offerees (the "Twice Refused Shares") at the Offer Price
per share in such proportions as they may agree upon. If the Preferred Offerees
are unable to agree within the Preferred Offer Period on the proportions in
which they will purchase the Twice Refused Shares, each of the Preferred
Offerees shall be entitled to purchase its PRO RATA portion (based on the number
of Preferred and Class B Shares such Preferred Offeree owns in relation to the
total number of Preferred and Class B Shares owned by all of the Preferred
Offerees) of the Twice Refused Shares by notifying the Offeror in writing,
within an additional ten (10) day period after the close of the Preferred Offer
Period and with copies to the Company and the other Shareholders, of its
election to make such purchase. The Preferred Offerees shall have a right of
oversubscription such that if any Preferred Offeree does not elect to purchase
his or her PRO RATA portion of the Twice Refused Shares, the other Preferred
Offerees shall, among them, have the right to purchase up to the balance of the
Twice Refused Shares not so purchased. Such right of oversubscription may be
exercised by a Preferred Offeree by specifying in its notice to the Offeror its
election to purchase more than its PRO RATA portion of the Twice Refused Shares.
If, as a result thereof, such oversubscriptions exceed the number of Twice
Refused Shares available in respect of such oversubscription privilege, the
oversubscribing Preferred Offerees shall be reduced with respect to their
oversubscriptions in accordance with their respective PRO RATA portions of the
Twice Refused Shares.
(e) CLOSING. A closing of the purchase of Offered Shares
pursuant to Sections 2(b), 2(c) or 2(d) immediately above shall take place at
the principal office of the Company within one hundred twenty (120) days after
the delivery of the Transfer Notice. Notwithstanding any other provision of this
Agreement, however, if the Offer Price of such Offered Shares has been
determined pursuant to Section 3(g) below, (i) any Person who has elected to
purchase any of such Offered Shares shall have the right to thereafter reduce
(including to zero) the number of Offered Shares he, she or it has elected to
purchase by delivering a written notice thereof to the Offeror (and the other
Persons who have elected to purchase any of such Offered Shares shall have
oversubscription rights with respect to such reduction) within ten (10) days
after such determination (but in any event before such closing), and (ii) such
closing shall take place thirty (30) days after such determination (or on the
next day that is not a Saturday, Sunday or legal holiday in New York, New York).
At such closing, each Person purchasing Offered Shares shall deliver to the
Offeror against delivery of certificates duly endorsed and stock powers
representing the Offered Shares being acquired by such Person the Offer Price
per share payable in respect of such Offered Shares; PROVIDED, HOWEVER, that the
amount payable by any such Person shall in no event be payable on terms, or on a
schedule, less favorable to such Person than those specified in the Transfer
Notice if such Transfer involves a sale. All of the foregoing deliveries shall
be deemed to be made simultaneously and none shall be deemed completed until all
have been completed.
(f) ADDITIONAL RIGHTS OF PREFERRED OFFEREES. Notwithstanding
any other provision of this Section 2, and in addition to any and all rights it
may have under this
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Agreement, a Preferred Offeree may (i) assign its rights under this Section 2 to
purchase Offered Shares or cause any Offered Shares that it may purchase
pursuant to this Section 2 to be issued in the name of any such Person as it may
designate, and (ii) require the Company to issue to it in exchange for any
Offered Shares purchased by it pursuant to this Section 2 an equal number of
Class B Shares. The Company shall maintain a number of authorized but unissued
Class B Shares equal to the number of Common Shares that are issued and
outstanding.
(g) NO RIGHTS OF OFFEROR TO PURCHASE. During the period that a
Common Shareholder's Common Shares are subject to repurchase under this Section
2 as a result of a proposed Transfer by such Common Shareholder, such Common
Shareholder shall have no right to participate in the purchase of the Common
Shares of any other Common Shareholder whose Common Shares are also then subject
to purchase under this Section 2 or Section 3. If the Common Shares of two or
more Common Shareholders are subject to purchase at any time under this
Agreement, the Company, the Common Shareholders whose Common Shares are not then
subject to purchase and the Preferred Optionees may exercise their rights to
purchase the Common Shares of all of such Common Shareholders or any combination
of them in any amounts or proportions.
(h) SHARES NOT PURCHASED BY COMPANY OR OTHER SHAREHOLDERS. If
the Company and/or the Common and Preferred Offerees do not elect to purchase
all of the Offered Shares, then the remaining Offered Shares may be Transferred
to the Third Party Offeree, on the terms and conditions (including for the
price, if any) specified in the Transfer Notice, within thirty (30) days after
the expiration of the Preferred Offer Period plus any ten (10) day extensions
thereof pursuant to Section 2(d), after which, if such Offered Shares have not
been Transferred to such Third Party Offeree, all restrictions contained herein
shall again be in full force and effect. As a condition to the effectiveness of
any Transfer of Common Shares to a Third Party Offeree, such Third Party Offeree
shall execute and deliver to the Company, with copies to each of the
Shareholders, a counterpart of this Agreement (including appropriate amendments
to the SCHEDULES attached hereto), which shall evidence such Third Party
Offeree's agreement that the Common Shares so Transferred to him or her shall
continue to be subject to this Agreement and that as to such Common Shares the
Third Party Offeree shall be bound by the restrictions of this Agreement.
(i) TRANSFERS PURSUANT TO SECTION 3. This Section 2 shall not
apply to any Transfer made pursuant to Section 3 of this Agreement.
3. OPTION EVENTS.
(a) NOTICE. Within thirty (30) days after the occurrence of an
Option Event with respect to any Common Shareholder (other than the Partnership,
HCHI or any Affiliate or Subsidiary of the Partnership or HCHI) (the
"Optionor"), such Optionor shall notify the Company, the other Common
Shareholders (the "Common Optionees") and the Preferred and Class B Shareholders
(collectively, the "Preferred Optionees") of such occurrence. Any notice
delivered pursuant to this Section 3(a) shall specify the number of Common
Shares owned by such Optionor.
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(b) RIGHT OF COMPANY TO PURCHASE. After the occurrence of an
Option Event with respect to an Optionor, the Company shall have the right to
purchase all or any portion of such Optionor's Common Shares (the "Option
Shares") at a price equal to the Option Event Value per share of such Option
Shares. To exercise its right to purchase Option Shares of an Optionor, the
Company shall provide written notice of its election to make such purchase,
within the ninety (90) day period (the "Company Option Period") after the
occurrence of such Option Event, to such Optionor, the Common Optionees and the
Preferred Optionees.
(c) RIGHT OF COMMON OPTIONEES TO PURCHASE. If the Company does
not elect to purchase all of the Option Shares it may purchase pursuant to
Section 3(b) following the occurrence of an Option Event with respect to an
Optionor, the Common Optionees shall have a period of thirty (30) additional
days beyond the Company Option Period (the "Common Option Period") to elect, by
written notice to the Optionor, to purchase the Option Shares not purchased by
the Company (the "Remaining Shares") at a price equal to the Option Event Value
per share in such proportions as they may agree upon. If the Common Optionees
are unable to agree within the Common Option Period on the proportions in which
they will purchase the Remaining Shares, each of the Common Optionees shall be
entitled to purchase his or her PRO RATA portion (based on the number of Common
Shares such Common Optionee owns in relation to the total number of Common
Shares owned by all of the Common Optionees) of the Remaining Shares by
notifying such Optionor in writing, within an additional ten (10) day period
after the close of the Common Option Period and with copies to the Company and
the other Shareholders, of his or her election to make such purchase. The Common
Optionees shall have a right of oversubscription such that if any Common
Optionee does not elect to purchase his or her PRO RATA portion of the Remaining
Shares, the other Common Optionees shall, among them, have the right to purchase
up to the balance of the Remaining Shares not so purchased. Such right of
oversubscription may be exercised by a Common Optionee by specifying in his or
her notice to the Optionor his or her election to purchase more than his or her
PRO RATA portion of the Remaining Shares. If, as a result thereof, such
oversubscriptions exceed the number of Remaining Shares available in respect of
such oversubscription privilege, the oversubscribing Common Optionees shall be
reduced with respect to their oversubscriptions in accordance with their
respective PRO RATA portions of the Remaining Shares.
(d) RIGHT OF PREFERRED OPTIONEES TO PURCHASE. If the Company
and the Common Optionees do not elect to purchase all of the Option Shares, the
Preferred Optionees shall have a period of thirty (30) additional days beyond
the Common Option Period (plus any extensions thereof) (the "Preferred Option
Period") to elect, by written notice to the Optionor, to purchase the Remaining
Shares not purchased by the Common Optionees (the "Twice Remaining Shares") at a
price equal to the Option Event Value per share in such proportions as they may
agree upon. If the Preferred Optionees are unable to agree within the Preferred
Option Period on the proportions in which they will purchase the Twice Remaining
Shares, each of the Preferred Optionees shall be entitled to purchase its PRO
RATA portion (based on the number of Preferred and Class B Shares such Preferred
Optionee owns in relation to the total number of Preferred and Class B Shares
owned by all of the Preferred Optionees) of the Twice Remaining Shares by
notifying such Optionor in writing, within an additional ten (10) day period
after the close of the
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Preferred Option Period and with copies to the Company and the other
Shareholders, of its election to make such purchase. The Preferred Optionees
shall have a right of oversubscription such that if any Preferred Optionee does
not elect to purchase its PRO RATA portion of the Twice Remaining Shares, the
other Preferred Optionees shall, among them, have the right to purchase up to
the balance of the Twice Remaining Shares not so purchased. Such right of
oversubscription may be exercised by a Preferred Optionee by specifying in its
notice to the Optionor its election to purchase more than its PRO RATA portion
of the Twice Remaining Shares. If, as a result thereof, such oversubscriptions
exceed the number of Twice Remaining Shares available in respect of such
oversubscription privilege, the oversubscribing Preferred Optionees shall be
reduced with respect to their oversubscriptions in accordance with their
respective PRO RATA portions of the Twice Remaining Shares.
(e) CLOSING AND PAYMENT. A closing of the purchase of Option
Shares to be purchased pursuant to Section 3(b), 3(c) or 3(d) immediately above
as a result of an Option Event shall take place at the principal office of the
Company within one hundred twenty (120) days after the occurrence of such Option
Event. Notwithstanding any other provision of this Agreement, however, if the
Option Event Value of such Option Shares has been determined pursuant to Section
3(g) below, (i) any Person who has elected to purchase any of such Option Shares
shall have the right to thereafter reduce (including to zero) the number of
Option Shares he, she or it has elected to purchase by a written notice thereof
to the Optionor (and the other Persons who have elected to purchase any of such
Option Shares shall have oversubscription rights with respect to such
reduction), and (ii) such closing shall take place within the thirty day period
after such determination. At such closing, each Person purchasing Option Shares
shall deliver to the Optionor against delivery of certificates duly endorsed and
stock powers representing the Option Shares being acquired by such Person the
Option Event Value per share payable in respect of such Option Shares. All of
the foregoing deliveries shall be deemed to be made simultaneously and none
shall be deemed completed until all have been completed. The price to be paid
for any Option Shares purchased pursuant to this Section 3 may be paid, at the
option of the purchaser, with a promissory note of the purchaser that (i) is
fully recourse to the purchaser, (ii) is secured by the purchased Option Shares,
(iii) has a term not longer than three (3) years, (iv) provides for level,
annual payments of principal over its term, (v) may be prepaid in full or part
at any time without penalty and (vi) provides for monthly payments of interest
on its outstanding principal balance at a rate, adjusted annually on each
anniversary of the date of its issuance, at least equal to the prime rate of
interest as published from time to time in the Wall Street Journal plus 1%.
(f) ADDITIONAL RIGHTS OF PREFERRED OPTIONEES. Notwithstanding
any other provision of this Section 3, and in addition to any and all rights it
may have under this Agreement, a Preferred Optionee may (i) assign its rights
under this Section 3 to purchase Option Shares or cause any Option Shares that
it may purchase pursuant to this Section 3 to be delivered in the name of any
such Person as it may designate, and (ii) require the Company to issue to it in
exchange for any Option Shares purchased by it pursuant to this Section 3 an
equal number of Class B Shares. The Company shall maintain a number of
authorized but unissued Class B Shares equal to the number of Common Shares that
are issued and outstanding.
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(g) VALUE OF SHARES IF NEITHER THE PARTNERSHIP NOR HCHI A
MAJORITY PREFERRED SHAREHOLDER. If neither the Partnership nor HCHI holds a
majority of the Preferred Shares as of the date any Optionor suffers an Option
Event and the Company or any Common or Preferred Optionee has elected to
purchase any or all of the Optionor's Option Shares, the Gross Company Value
shall be determined by valuing the Company on a "going concern" rather than a
"liquidation" basis as of the time of such Option Event pursuant to this Section
3(g).
(i) AGREEMENT AS TO VALUE. The Optionor and the
Persons who have elected to purchase any or all of the Option Shares pursuant to
this Section 3 (the "Purchasers") shall attempt to determine such Gross Company
Value in good faith. If the Optionor and those of the Purchasers who have
elected to purchase a majority of the total number of Option Shares which the
Purchasers have elected to purchase (a "Majority of the Purchasers") reach an
agreement as to the Gross Company Value within thirty (30) days after the last
timely delivery of an election by a Purchaser to purchase any or all of the
Option Shares, such agreed upon amount shall be the Gross Company Value for
purposes of any purchase of Option Shares from such Optionor as a result of such
Option Event.
(ii) AGREEMENT AS TO APPRAISER. If an agreement
as to the Gross Company Value is not reached by the Optionor and a Majority of
the Purchasers pursuant to Section 3(g)(i) immediately above within thirty (30)
days after the last timely delivery of an election by a Purchaser to purchase
any or all of the Option Shares, the Optionor and the Purchasers shall use their
best efforts to agree on the selection of an independent appraiser or investment
banking firm to determine the Gross Company Value. If the Option Shares of more
than one Optionor are then being valued, each such Optionor shall participate in
the selection of such appraiser or investment banking firm so that the value of
all such Option Shares may be determined by a single appraiser or investment
banking firm. If the Optionor and a Majority of the Purchasers reach an
agreement as to the selection of an appraiser or investment banking firm within
sixty (60) days after the last timely delivery of an election by a Purchaser to
purchase any or all of the Option Shares, such appraiser or investment banking
firm shall determine the Gross Company Value within sixty (60) days after its
selection. The amount determined by such appraiser or investment banking firm
shall be the Gross Company Value for purposes of any purchase of Option Shares
from such Optionor as a result of such Option Event.
(iii) NO AGREEMENT AS TO APPRAISER. If an
appraiser or investment banking firm has not been selected to determine the
Gross Company Value pursuant to Section 3(g)(ii) immediately above within sixty
(60) days after the last timely delivery of an election by a Purchaser to
purchase any or all of the Option Shares, two independent appraisers or
investment banking firms with at least five (5) years of experience in valuing
companies engaged in businesses similar to that of the Company shall be selected
to determine the Gross Company Value. One such appraiser or investment banking
firm shall be promptly selected by the Optionor. The other such appraiser of
investment banking firm shall be promptly selected by a Majority of the
Purchasers. If a Majority of the Purchasers are unable to agree among themselves
on such a selection within a thirty (30) day period, the selection of an
appraiser or investment banking firm for the Purchasers shall be made by the
Board of Directors of the Company. After two appraisers or investment banking
firms have been selected to determine the
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Gross Company Value pursuant to this Section 3(g)(iii), such two appraisers or
investment banking firms shall separately determine the Gross Company Value
within sixty (60) days after their respective selections, and the Gross Company
Value (for purposes of any purchase of Option Shares from the Optionor as a
result of such Option Event) shall be the arithmetic average of the amounts
determined by such appraisers or investment banking firms; PROVIDED, that if the
higher of such values exceeds the lower of such values by more than 25% of such
lower value, either the Optionor or a Majority of the Purchasers may cause such
two appraisers or investment banking firms to select a third appraiser or
investment banking firm to determine the Gross Company Value, in which case the
Gross Company Value (for purposes of any purchase of Option Shares from the
Optionor as a result of such Option Event) shall be the arithmetic average of
the two of such three amounts that are closest together.
(iv) COST OF APPRAISALS. If a single appraiser or
investment banking firm determines the Gross Company Value pursuant to Section
3(g)(ii) above, the cost of such appraiser or investment banking firm shall be
paid one-half by the Optionor and one-half by the Purchasers (as among them, in
proportion to the numbers of Option Shares they have elected to purchase). If
two appraisers or investment banking firms determine the Gross Company Value,
(A) the costs of the appraiser or investment banking firm selected by the
Optionor shall be paid by the Optionor, and (B) the costs of the appraiser or
investment banking firm selected by a Majority of the Purchasers shall be paid
by the Purchasers (as among them, in proportion to the numbers of Option Shares
they have elected to purchase). The costs of any third appraiser or investment
banking firm shall be paid by the Purchasers (as among them, in proportion to
the numbers of Option Shares they have elected to purchase) unless the Gross
Company Value determined by such third appraiser or investment banking firm is
closer to the value determined by the appraiser or investment banking firm
selected by a Majority of the Purchasers than to the value determined by the
appraiser or investment banking firm selected by the Optionor, in which case the
costs of such third appraiser or investment banking firm shall be paid by the
Optionor.
(v) VALUATION METHODOLOGY. The valuation factors
that may be considered in determining the Gross Company Value may include,
without limitation, the following: the current earnings of the Company and each
of its Affiliates and Subsidiaries; the earnings history of the Company and each
of its Affiliates and Subsidiaries; the prices paid for interests in similar
businesses during any relevant recent period; the average price/earnings ratios
of companies engaged in similar businesses; the current market values of the
assets of the Company and its Affiliates and Subsidiaries; management and
executive performance; tax liabilities to which the Company and its Affiliates
and Subsidiaries may be subject; and such additional criteria which are
appropriate to review in valuing interests in a going business.
(h) NO RIGHTS OF OPTIONOR TO PURCHASE. During the period
that a Common Shareholder's Common Shares are subject to repurchase under this
Section 3 as a result of an Option Event with respect to such Common
Shareholder, such Common Shareholder shall have no right to participate in the
purchase of the Common Shares of any other Common Shareholder whose Common
Shares are also then subject to purchase under Section 2 above or this Section
3. If the Common Shares of two or more Common Shareholders are subject to
purchase at any time under this Agreement, the Company, the Common Shareholders
whose Common Shares are not
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then subject to purchase and the Preferred Optionees may exercise their rights
to purchase the Common Shares of all of such Common Shareholders or any
combination of them in any amounts or proportions.
(i) SHARES NOT PURCHASED. If all of the Common Shares of an
Optionor are not purchased pursuant to this Section 3 after the occurrence of an
Option Event with respect to such Optionor, then the remaining Common Shares of
such Optionor may be retained by such Optionor or, if such Option Event involves
a Transfer, by the recipient of such Transfer, subject to all of the
restrictions contained herein. As a condition to the effectiveness of any
Transfer that occurs in connection with an Option Event, the recipient of such
Transfer shall execute and deliver to the Company, with copies to each of the
Shareholders, a counterpart of this Agreement (with appropriate amendments to
the SCHEDULES attached hereto), which shall evidence such recipient's agreement
that the Shares so Transferred to him or her shall continue to be subject to
this Agreement and that as to such Common Shares such recipient shall be bound
by the restrictions of this Agreement.
(j) ESTATES AND REPRESENTATIVES. In the case of any Optionor
who has died or become incompetent, any reference in this Section 3 to such
Optionor shall be a reference to such Optionor's estate or other legal
representatives or successors, as the context may require.
4. PREEMPTIVE RIGHTS.
(a) PREEMPTIVE RIGHTS. The Company hereby grants to each
Shareholder so long as he, she or it shall hold any Shares the right to purchase
up to a PRO RATA portion of New Securities (as defined in Section 4(b) below)
which the Company, from time to time, proposes to sell or issue. A Shareholder's
PRO RATA portion, for purposes of this Section 4, is the ratio of the number of
Shares then owned by such Shareholder to the total number of Shares then
outstanding on a fully diluted basis after giving effect to the exercise of all
options, warrants and the like and the conversion of all securities convertible
into or exchangeable for Shares. The Shareholders shall have a right of
oversubscription such that if any Shareholder does not elect to purchase his,
her or its PRO RATA portion of any New Securities, the other Shareholders shall,
among them, have the right to purchase up to the balance of the New Securities
not so purchased. Such right of oversubscription may be exercised by a
Shareholder by specifying in its notice pursuant to Section 4(c) below its
election to purchase more than its PRO RATA portion of the New Securities. If,
as a result thereof, such oversubscriptions exceed the number of New Securities
available in respect of such oversubscription privilege, the oversubscribing
Shareholders shall be reduced with respect to their oversubscriptions in
accordance with their respective PRO rata portions of the New Securities.
(b) NEW SECURITIES. "New Securities" shall mean any capital
stock of the Company whether now authorized or not, any rights, options or
warrants to purchase capital stock and any indebtedness or preferred stock of
the Company which is convertible into capital stock (or which is convertible
into a security which, in turn, is convertible into capital stock); PROVIDED,
that the term "New Securities" does not include (i) shares of capital stock
issued as a stock dividend to all holders of capital stock PRO RATA or upon any
subdivision or combination of
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shares of capital stock, or (ii) any employee stock options approved by the
Board of Directors of the Company.
(c) NOTICE FROM THE COMPANY. In the event the Company proposes
to issue New Securities, the Company shall give each Shareholder written notice
of such proposal, describing the type of New Securities and the price and the
terms upon which the Company proposes to issue such New Securities. For a period
of twenty (20) days following the delivery of such notice by the Company, the
Company shall be deemed to have irrevocably offered to sell to each Shareholder
its PRO RATA share of such New Securities for the price and upon the terms
specified in the notice. Each Shareholder may exercise his, her or its
preemptive rights hereunder by giving written notice to the Company stating
therein the quantity of New Securities to be purchased by such Shareholder.
Notwithstanding any other provision of this Section 4, and in addition to any
and all rights it may have hereunder, a Preferred Shareholder may (i) assign its
rights under this Section 4 to purchase New Securities or cause any New
Securities that it may purchase pursuant to this Section 4 to be delivered in
the name of any such Person as it may designate and (ii) require that any New
Securities that it purchases hereunder be nonvoting to the extent necessary to
preserve HCHI's status as a REIT for federal income tax purposes.
(d) SALE BY THE COMPANY. In the event any Shareholder fails to
exercise in full his, her or its preemptive right within the twenty (20) day
period described in Section 4(c) immediately above, the Company shall have sixty
(60) days thereafter to sell the New Securities with respect to which such
preemptive right was not exercised at a price and upon terms no more favorable
to the purchasers thereof than specified in the Company's notice pursuant to
Section 4(c) immediately above.
(e) CLOSING. The closing for any issuance under this Section 4
shall take place as proposed by the Company with respect to the shares to be
issued, at which closing the Company shall deliver certificates for such shares
in the respective names of the purchasing Shareholders against receipt of
payment therefor. All such shares shall be held by such Shareholders subject in
all respects to the terms of this Agreement.
5. CORPORATE GOVERNANCE. No Shareholder shall grant any proxy or
enter into or agree to be bound by any voting trust with respect to his, her or
its Shares nor shall any Shareholder enter into any shareholders agreements or
arrangements of any kind with any person with respect to the Shares on terms
which conflict with the provisions of this Agreement (whether or not such
agreements and arrangements are with other Shareholders), including, but not
limited to, agreements or arrangements with respect to the acquisition,
disposition or voting of Shares inconsistent herewith.
6. TERMINATION. This Agreement shall terminate upon the earlier
to occur of (a) dissolution or complete liquidation of the Company, (b) an
assignment for the benefit of creditors by, or an adjudication of bankruptcy or
appointment of a receiver for the Company or (c) a merger or consolidation of
the Company pursuant to which the Common Shareholders do not Control the
surviving corporation; provided, however, that no such termination shall have
any effect on the obligations herein set forth of the Company or the
Shareholders which have accrued
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as of such termination and to the extent applicable to such obligations, this
Agreement shall continue in effect until all such obligations have been
satisfied in full.
7. FAILURE TO DELIVER SHARES. If a Shareholder becomes obligated
to sell any Shares to the Company or to other Shareholders under this Agreement
and fails to deliver such Shares in accordance with the terms of this Agreement,
the Company or the other Shareholders (whichever the case may be) may, in
addition to all other remedies it or they may have, send to such Shareholder the
purchase price for such Shares as herein specified. Thereupon, the Company upon
written notice to the obligated Shareholder, (a) shall cancel on its books the
certificate or certificates representing the Shares to be sold and (b) shall
issue, in lieu thereof, in the name of the Company or the other Shareholders
(whichever the case may be) a new certificate or certificates representing such
Shares, and thereupon all of the obligated Shareholder's rights in and to such
Shares shall terminate.
8. REMEDIES; DISPUTES.
(a) SPECIFIC PERFORMANCE. If a Shareholder makes or attempts
to make a Transfer of Shares contrary to the provisions of this Agreement, the
Company and the other Shareholders may enforce their respective rights under
this Agreement by actions for specific performance (to the extent permitted by
law) in addition to pursuing any other legal or equitable remedies they may
have. In addition, the Company may refuse to recognize any Person who receives
shares of stock in the Company contrary to the provisions of this Agreement as a
shareholder for any purpose, including, without limitation, for purposes of
dividend and voting rights, until all applicable provisions of this Agreement
have been complied with.
(b) DISPUTE RESOLUTION. All disputes, differences and
controversies arising hereunder shall be settled and finally determined by
arbitration in the City of New York under the then existing rules of the
American Arbitration Association.
9. ENTIRE AGREEMENT; AMENDMENT; WAIVER. This Agreement sets forth
the entire understanding of the parties, and supersedes all prior agreements and
all other arrangements and communications, whether oral or written, with respect
to the subject matter of this Agreement, including, without limitation, the
Original Agreement the First Amended Agreement and the Plan of Recapitalization.
Neither this Agreement nor any provision of this Agreement may be waived,
modified, amended or terminated except by a written agreement signed by the
parties to this Agreement. Waiver by a party to this Agreement of any breach of
or failure to comply with any provision of this Agreement by any other party
shall not be construed as, or constitute, a continuing waiver of such provision,
or a waiver or any other breach of, or failure to comply with, any other
provision of this Agreement.
10. SEVERABILITY. The invalidity or unenforceability of any
particular provision of this Agreement shall not affect the other provisions of
this Agreement, and this Agreement shall be construed in all respects as if the
invalid or unenforceable provision were omitted.
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11. NOTICES. All notices and other communications necessary or
contemplated under this Agreement shall be in writing and shall be deemed to
have been duly given or made if personally delivered or sent by United States
mail or express mail service or by telegram confirmed by letter or telecopy to
the respective addresses set forth below:
(a) THE COMPANY. For notices and communications to the
Company:
Hanover Capital Partners Ltd.
00 Xxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, Xxx Xxxx 00000
Attention: President
(b) THE SHAREHOLDERS. For notices and communications to
the Shareholders, to the respective addresses set forth on SCHEDULE 1 attached
hereto.
All notices and other communications will be deemed to have been duly given,
unless earlier received, (i) if sent by certified or registered mail, return
receipt requested, or by first-class mail, five (5) calendar days after being
deposited in the United States mails, postage prepaid, (ii) if sent by United
States Express Mail or other express mail service, two calendar days (other than
Sundays and federal holidays) after being deposited therein, (iii) if sent by
telegram or telecopy, on the date sent provided confirmatory notice is sent by
first-class mail, postage prepaid, and (iv) if delivered by hand, on the date of
receipt.
By notice complying with the foregoing provisions of this Section 11, each party
shall have the right to change the mailing address for future notices and
communications to such party.
12. BINDING EFFECT; ASSIGNMENT. This Agreement shall be binding
upon and shall inure to the benefit of the parties hereto and to their
respective heirs, executors, administrators, legal representatives, successors
and permitted assigns; provided, however, that the rights under this Agreement
may not be assigned except as expressly provided herein. This Agreement shall
apply to all stock and equity securities of the Company now or hereafter
acquired by the Shareholders or any of their successors in interest.
13. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York, without giving
effect to the principles relating to conflicts of law, as to all matters,
including, but not limited to, matters of validity, construction, effect,
performance and remedies.
14. RECAPITALIZATION, EXCHANGES, ETC. Except upon termination of this
Agreement pursuant to Section 6(c) above, the provisions of this Agreement shall
apply, to the full extent set forth in this Agreement with respect to Shares, to
any and all shares of capital stock of the Company or any successor or assign of
the Company (whether by merger, consolidation, sale of assets or otherwise)
which may be issued in respect of, in exchange for, or in substitution of the
Shares, by reason of a stock dividend, stock split, stock issuance, reverse
stock split, combination, recapitalization, reclassification, merger,
consolidation or otherwise. Upon the
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occurrence of any such events, amounts set forth on SCHEDULE 1 shall be
appropriately adjusted and this Agreement shall be amended to reflect the same
within ten (10) days.
15. PURCHASE FOR INVESTMENT; LEGEND. Each of the parties to this
Agreement acknowledges that he, she or it holds the Shares shown opposite his,
her or its name on the attached SCHEDULE 1, that all of the Shares held by such
party as shown on SCHEDULE 1 to this Agreement are being (or have been) acquired
for investment and not with a view to the distribution thereof and that no
transfer, hypothecation or assignment of Shares may be made except in compliance
with applicable federal and state securities laws. All the certificates of
Shares of the Company which are now or hereafter owned by the Common
Shareholders and which are subject to the terms of this Agreement shall have
endorsed in writing, stamped or printed, thereon, the following legend:
THESE SECURITIES ARE SUBJECT TO THE TERMS AND CONDITIONS,
INCLUDING RESTRICTIONS ON TRANSFER, OF A SHAREHOLDERS'
AGREEMENT, DATED AS OF ______________, 1997, A COPY OF WHICH
IS ON FILE WITH THE SECRETARY OF THE COMPANY AND WILL BE
MAILED TO ANY PROPERLY INTERESTED PERSON WITHOUT CHARGE WITHIN
FIVE (5) DAYS AFTER THE COMPANY'S RECEIPT OF A WRITTEN REQUEST
THEREFOR.
All Shares shall also bear all legends required by federal and state
securities laws.
16. HEADINGS. All headings and captions in this Agreement are for
purposes of reference only and shall not be construed to limit or affect the
substance of this Agreement.
17. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument, and all signatures need
not appear on any one counterpart. The Company agrees that a copy of this
Agreement shall be kept at the principal office of the Company for inspection by
the Shareholders. Any Shareholder shall have the right to inspect said copy of
this Agreement and the books and records of the Company at reasonable times
after reasonable notice.
18. NO EMPLOYMENT RIGHTS; NO DISCLOSURE. Each Shareholder agrees
and acknowledges that (a) neither the holding of Shares by such Shareholder nor
any provision of this Agreement shall give any Shareholder the right to be
retained in the employ of the Company or otherwise affect his or her employment
relationship with the Company, and (b) neither the Company nor any other
Shareholder shall have any duty affirmatively to disclose to a Shareholder, and
no Shareholder shall have any right to be advised of, any material information
regarding the Company or its business or prospects at any time prior to, upon or
in connection with any mandatory transfer of Shares under this Agreement.
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19. WAIVER OF CLAIMS; INDEMNIFICATION. Each Shareholder hereby waives
any claims he, she or it might otherwise have had against the Company or any
other Shareholder under the Original Agreement, the First Amended Agreement or
the Plan of Recapitalization. The Initial Shareholders (the "Indemnitors") shall
indemnify the Company and the other Shareholders (the "Indemnitees") for, and
hold them harmless from and against, any losses, expenses or damages the
Indemnitees may suffer or incur as a result of any actions or claims arising
under the Original Agreement, the First Amended Agreement or the Plan of
Recapitalization.
[Remainder of Page Intentionally Left Blank]
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IN WITNESS WHEREOF, the parties to this Agreement have executed this
Agreement as of the date first above written.
"COMPANY"
HANOVER CAPITAL PARTNERS LTD.
By:
----------------------------------------
Name:
Title:
"PARTNERSHIP"
HANOVER CAPITAL MORTGAGE , L.P.
By: Hanover Capital Mortgage Holdings, Inc.,
General Partner
By:
----------------------------------------
Name:
Title:
"XXXXXXXX"
--------------------------------------------
Xxxx X. Xxxxxxxx
"XXXXXXX"
--------------------------------------------
Xxxxx X. Xxxxxxx
"XXXXXXXXX"
--------------------------------------------
Xxxxxx X. Xxxxxxxxx
"XXXXXXX"
--------------------------------------------
Xxxx X. Xxxxxxx
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SCHEDULE 1
Shareholder Number and Class of Shares
----------- --------------------------
Xxxx X. Xxxxxxxx 1,650 Shares of Class A Common
000 Xxxxxxxx Xxxxxx Xxxxx
Xxxxxxxxx, XX 00000
Xxxxx X. Xxxxxxx 450 Shares of Class A Common
00 Xxxxxxx Xxx Xxxxx
Xxxxxxxx Xxxxxxxx, XX 00000
Xxxxxx X. Xxxxxxxxx 000 Shares of Class A Common
000 X. Xxxxxxxx Xxxxxx Xxxxx
Xxxxxxxxx Xxxxxxx, XX 00000
Xxxx X. Xxxxxxx 450 Shares of Class A Common
0 Xxxxx Xxxx Xxxxx
Xxxxxx Xxxxxx, XX 00000
Hanover Capital Mortgage Holdings, L.P. 97,000 Shares of Series A Preferred
000 Xxxxxxxxx Xxxxx Xxxxx
Xxxxx 000
Xxxxxx, XX 00000
20
