EXHIBIT 10.39
AMENDMENT NO. 1 TO
STANDSTILL AGREEMENT
THIS AMENDMENT NO. 1 (this "Amendment"), dated October 31, 2002, to the
STANDSTILL AGREEMENT ("Agreement"), dated the 20th day of February 2002, is made
by and between American Physicians Capital, Inc., a Michigan corporation
("ACAP"), on the one hand, and Xxxxxxxx Value Partners III, L.P., Xxxxxxxx Value
Partners V, L.P., Xxxxxxxx Associates, L.P., Xxxxxxxx Partners, L.P., Xxxxxxxx
Value, LLC, The Xxxxxxxx de Fleur Foundation, Inc., and Xxxxxx Xxxxxxxx
(collectively, the "Xxxxxxxx Group"), and Xxxxxxx X. Xxxxxxxxx ("Xxxxxxxx
Director") on the other.
WHEREAS, ACAP, the Xxxxxxxx Group and the Xxxxxxxx Director have agreed
that it is in their mutual interests to enter into this Amendment as hereinafter
described.
NOW, THEREFORE, in consideration of the premises and the representations,
warranties, and agreements contained herein, and other good and valuable
consideration, the parties hereto mutually agree as follows:
1. Section 7 of the Agreement is hereby amended and restated in its
entirety as follows:
The Xxxxxxxx Group has requested that the ACAP Board shall authorize the
repurchase of a sufficient number of its outstanding shares of common
stock so that (i) the number of shares outstanding on December 31, 2002 is
at least fifteen percent (15%) less than the number of shares outstanding
on December 31, 2001, and (ii) the number of shares outstanding on
December 31, 2003 is at least fifteen percent (15%) less than the number
of shares outstanding on the earlier of (x) December 31, 2002 or (y) the
date on which the number of shares outstanding was at least fifteen
percent (15%) less than the number of shares outstanding on December 31,
2001. For purposes of this paragraph, outstanding shares shall mean all
shares entitled to vote, and shall exclude all treasury shares. ACAP
agrees that, in light of all factors its Board considers appropriate, the
Board shall promptly consider increasing ACAP's existing share repurchase
program and in particular consider the request of the Xxxxxxxx Group, and
that the Board will further monitor such repurchase program during fiscal
2002 and 2003 in light of all relevant factors, including among others,
whether ACAP's shares are trading below the book value per share of ACAP
and its consolidated subsidiaries, the availability and alternative uses
of ACAP's excess capital, regulatory considerations, the reaction of
rating agencies to any proposed repurchase, and the market price of ACAP's
shares. Notwithstanding the foregoing, ACAP shall not be required to
authorize or consummate any repurchases described herein (i) if the ACAP
Board determines in good faith that such action is not in the best
interests of ACAP or its shareholders, or (ii) if any governmental
regulatory agency threatens or commences regulatory action against ACAP or
any of its subsidiaries as a direct or indirect result of such
repurchases.
2. Except as specifically set forth above, this Amendment shall not be
deemed to amend the terms and conditions of the Agreement in any respect.
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3. Unless otherwise defined to the contrary herein, all capitalized terms
used in this Amendment shall have the meaning set forth in the Agreement.
4. This Amendment may be executed in counterpart in accordance with
Section 17 of the Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of
the day and year first above written.
AMERICAN PHYSICIANS CAPITAL, INC. /s/ Xxxxxxx X. Xxxxxxxxx
------------------------------
Xxxxxxx X. Xxxxxxxxx
/s/ Xxxxxxx X. Xxxxxxxxx
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By: XXXXXXX X. XXXXXXXXX /s/ Xxxxxx Xxxxxxxx
President and CEO ------------------------------
Xxxxxx Xxxxxxxx
XXXXXXXX VALUE PARTNERS III, L.P.
/s/ Xxxxxx Xxxxxxxx
---------------------------------------
By: XXXXXXXX VALUE LLC
General Partner, by Xxxxxx Xxxxxxxx,
Managing and Sole Member
XXXXXXXX VALUE PARTNERS V, L.P.
/s/ Xxxxxx Xxxxxxxx
---------------------------------------
By: XXXXXXXX VALUE LLC
General Partner, by Xxxxxx Xxxxxxxx,
Managing and Sole Member
XXXXXXXX ASSOCIATES, L.P.
/s/ Xxxxxx Xxxxxxxx
---------------------------------------
By: XXXXXXXX VALUE LLC
General Partner, by Xxxxxx Xxxxxxxx
Managing and Sole Member
XXXXXXXX PARTNERS, L.P.
/s/ Xxxxxx Xxxxxxxx
---------------------------------------
By: XXXXXX XXXXXXXX
General Partner
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XXXXXXXX VALUE, LLC
/s/ Xxxxxx Xxxxxxxx
---------------------------------------
By: XXXXXX XXXXXXXX
Managing and Sole Member
THE XXXXXXXX DE FLEUR
FOUNDATION, INC.
/s/ Xxxxxx Xxxxxxxx
--------------------------------------
By: XXXXXX XXXXXXXX
President
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