Exhibit 2
STOCKHOLDER AGREEMENT, dated as of December 31, 1996, among Argo
Bancorp, Inc., a corporation organized under the laws of the State of Delaware
(the "Company"), The Deltec Banking Corporation Limited, a banking corporation
organized under the laws of the Commonwealth of the Bahamas ("Deltec"), and Xxxx
X. Xxxxxxx, the controlling stockholder of the Company (the "Controlling
Stockholder"), who is signing this Agreement solely for the purposes of Section
1.1 hereof.
W I T N E S S E T H
WHEREAS, concurrently with the execution and delivery hereof, Deltec
has purchased 111,563 2/3 shares (the "Shares") of original common stock, par
value $0.01 per share (the "Common Stock") of the Company, pursuant to the Stock
Purchase Agreement, dated as of December 31, 1996 (the "Stock Purchase
Agreement"), between the Company and Deltec;
WHEREAS, as of the date hereof, the Company has the authority to issue
5,000,000 shares of the par value $0.01 per share, of which 4,500,000 shares are
common stock and 500,000 shares are serial preferred stock, and the Company's
authorized common stock consists of 3,020,000 shares designated as original
common stock, 340,000 shares designated as Class B common stock, 340,000 shares
designated as Class C common stock and 800,000 shares designated as Class D
common stock, of which 446,254 2/3 shares of Common Stock have been issued
(after giving effect to Deltec's purchase of the Shares) and no shares of Class
B common stock, Class C common stock or Class D common stock have ever been
issued or authorized to be issued, and no shares of serial preferred stock have
ever been issued or authorized to be issued; and
WHEREAS, by entering into this Agreement and the Stock Purchase
Agreement, the Company, Deltec and the Controlling Stockholder understand that
Deltec's acquisition of the Shares is solely for Deltec's own account for the
purpose of investment and for the purpose of owning up to, but not more than,
25% of the outstanding voting stock of the Company and with no purpose or effect
of controlling or exercising a controlling influence over the management or
policies of the Company;
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants and agreements set forth herein and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, and
in order to induce Deltec to purchase the Shares as contemplated by the Stock
Purchase Agreement, the parties hereto hereby agree as follows:
ARTICLE I
BOARD OF DIRECTORS
1.1 Directors. So long as this Agreement shall continue in effect and
so long as Deltec shall own at least 15% of the outstanding Common Stock of the
Company, Deltec shall have the right to nominate one director to serve on the
Board of Directors of the Company, and so long as Deltec shall remain in
compliance with Section 1.2 of this Agreement, the Controlling Stockholder shall
vote (or cause to be voted) all shares of Common Stock owned by him for the
election as a director of the Company of the nominee designated by Deltec at any
annual or special meeting called for such purpose.
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1.2 Rebuttal Agreement. While this Agreement continues in effect,
Deltec shall remain in compliance with the Rebuttal Agreement between Deltec and
the Office of Thrift Supervision.
ARTICLE II
SALE OR PURCHASE OF CAPITAL STOCK
2.1 Issuance of Capital Stock. If the Company shall at any time propose
to issue or sell any additional shares of its Common Stock (the "Additional
Shares"), whether such shares are authorized but previously unissued shares or
are treasury shares, then the Company shall notify Deltec thereof as promptly as
practicable and shall offer to sell to Deltec, concurrently with the issuance
and sale of the Additional Shares, such number of additional shares of Common
Stock (including fractional shares) so that Deltec shall continue, after giving
effect to such sales, to own exactly 25% of the outstanding shares of Common
Stock. In case such sale of Additional Shares is for cash, the Company's offer
to Deltec shall be at a purchase price equal to the price per share paid for the
Additional Shares and shall be upon substantially the same other terms and
conditions, except that in the case of the exercise of employee stock options,
the Company's offer to Deltec shall be at a price equal to the Market Price (as
hereinafter defined) on the date of sale. In case such sale of Additional Shares
is for consideration other than cash, the Company's offer to Deltec shall be at
a price equal to the fair market value per share of such other consideration, as
determined by the Board of Directors of the Company for purposes of the
Company's financial statements. "Market Price" as of any date shall mean the
average of the high and low sale prices of the Company's Common Stock as
reported on the NASDAQ Stock Market (the "Average") for the 30 business days
immediately preceding the date in question, provided that (i) prior to the
issuance of stock pursuant to a public offering (the "Public Offering") expected
to occur prior to June 30, 1997, or such later date as the Company and its
underwriters may determine, the Market Price shall equal 94.7% of the book value
of the Company as set forth on the Company's most recent balance sheet prior to
the date in question, (ii) the Market Price of stock purchased in connection
with the Public Offering shall equal the public offering price, (iii) during the
30-day period following the Public Offering the Market Price will equal the
greater of the public offering price or the Average for the period from the date
of the Public Offering to the date in question, and (iv) the Market Price of
stock purchased in connection with any subsequent public offering shall equal
the public offering price in such subsequent public offering.
2.2 Purchase or Acquisition of Common Stock. If at any time the Company
shall propose to purchase or otherwise acquire any outstanding shares of its
Common Stock, then the Company shall notify Deltec thereof as promptly as
practicable and shall offer to purchase from Deltec, concurrently with such
purchase or other acquisition, such number of shares (including fractional
shares) that, after giving effect thereto, Deltec will own exactly 25% of the
outstanding shares of Common Stock.
2.3 Other Classes of Stock. If at any time the Company shall propose to
issue or sell any shares of Class B common stock, Class C common stock, Class D
common stock or serial preferred stock authorized by its certificate of
incorporation or any other class of common stock hereafter authorized by the
Company, then the Company shall notify Deltec thereof as promptly as practicable
and shall offer to sell to Deltec,
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concurrently with the issuance of such shares such number of such shares as will
enable Deltec to maintain ownership of 25% of such other class of stock.
2.4. Registration Rights. The Company hereby grants Deltec the
following rights with respect to registration under the Securities Act of 1933
(the "Securities Act") of any shares of Common Stock or other equity securities
(hereinafter referred to as the "Registrable Securities") acquired by Deltec
from the Company under the Stock Purchase Agreement or this Agreement. If Deltec
desires to sell any Registrable Securities at any time after the earlier of the
completion of the Public Offering or June 30, 1997, Deltec shall give the
Company at least 30 days' notice thereof, specifying the approximate number of
Registrable Securities Deltec desires to sell and the intended method of
disposition thereof, and if in the opinion of Deltec or the Company such
intended method of disposition requires registration under the Securities Act,
the Company will promptly prepare and file a Registration Statement under the
Securities Act covering the Registrable Securities and will use its best efforts
to cause such Registration Statement to become effective as promptly as
practicable. If at any time after the completion of the Public Offering the
Company shall propose to file a Registration Statement under the Securities Act,
the Company shall give Deltec at least 10 days' notice thereof and shall afford
Deltec the opportunity to include any Registrable Securities it proposes to sell
in such Registration Statement. In connection with any such Registration
Statement, the Company shall indemnify and hold harmless Deltec and any
underwriter or placement agent of such Registrable Securities (each an
"Underwriter") against any losses, claims, damages or liabilities, joint or
several, or actions in respect thereof ("Claims"), to which Deltec or such
Underwriter may become subject, under the Securities Act or otherwise, insofar
as such Claims arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in the Registration Statement,
the related prospectus, any preliminary prospectus or any amendment or
supplement thereto (collectively, "Registration Documents") or the omission or
alleged omission to state in any Registration Document a material fact required
to be stated therein or necessary to make the statements made therein not
misleading, and will reimburse Deltec or any such Underwriter for any legal or
other expenses reasonably incurred in investigating or defending any such Claim
as such expenses are incurred; provided, that the Company shall not be liable in
any such case to the extent that any such Claim arises out of or is based upon
an untrue statement or alleged untrue statement or omission or alleged omission
made in any Registration Document in reliance upon and in conformity with
written information furnished to the Company by or on behalf of Deltec or any
such Underwriter specifically for use in such Registration Document. In
connection with any such Registration Statement, Deltec shall indemnify and hold
harmless the Company and any Underwriter against any Claims to which the Company
or such Underwriter may become subject, under the Securities Act or otherwise,
insofar as such Claims arise out of or are based upon any untrue statement or
alleged untrue statement of any material fact contained in written information
furnished to the Company by or on behalf of Deltec specifically for use therein,
and will reimburse the Company or any such Underwriter for any legal or other
expenses reasonably incurred in investigating or defending any such Claim as
such expenses are incurred. In connection with only the first two Registration
Statements filed by the Company pursuant to the second sentence of this Section
2.4 and all Registration Statements filed by the Company pursuant to the third
sentence of this Section 2.4, the Company shall be responsible for all expenses
and fees incident to the preparation of such
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Registration Statement, including all registration and filing fees, the cost of
preparing and printing the Registration Documents and any other documents used
in connection with the offering, purchase, sale and delivery of the Registrable
Securities, the costs and charges of any transfer agent, registrar, custodian or
attorneys-in-fact and the fees and disbursements of counsel for the Company and
the Company's independent public accountants, including the expenses of any
"comfort" letters; provided that Deltec shall be responsible for the fees and
disbursements of its own counsel, if any, and all underwriting discounts and
commissions relating to the sale or disposition of the Registrable Securities.
ARTICLE III
MISCELLANEOUS
3.1 Amendments, Termination, Transfer, etc. Neither this Agreement nor
any provision hereof may be changed, waived, discharged or terminated orally,
but only by an instrument in writing signed by each of the Company, Deltec, and
the Controlling Stockholder.
3.2 Notices. All notices, requests, permissions, waivers, and other
communications hereunder shall be in writing and shall be deemed to have been
duly given when received if delivered by hand, facsimile transmission or by
United States mail (registered, return receipt requested), properly addressed
and postage prepaid:
If to the Company or the Controlling Stockholder, to:
Argo Bancorp, Inc.
0000 Xxxx 00xx Xxxxxx
Xxxxxx, Xxxxxxxx 00000
Attn: Xxxxxxx Xxxxx, Esq.
General Counsel
Tel.: 000-000-0000
Fax: 000-000-0000
with a copy to:
Xxxxxxx, Xxxxxx & Xxxxxxxx
0000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxxxxxxx, X.X. 00000
Attn: Xxxx X. Xxxxxxxx, Esq.
Tel.: 000-000-0000
Fax: 000-000-0000
If to Deltec, to:
The Deltec Banking Corporation Limited
Deltec House, P.O. Box N-3229
Xxxxxx Xxx, Nassau, Bahamas
Attn: Xxxxxxx X. Xxxxxxx, President
Tel.: 000-000-0000
Fax: 000-000-0000
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with a copy to:
Xxxxxxxx & Xxxxxxxx
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxxx X. Xxxx, Esq.
Tel.: 000 000-0000
Fax: 000 000-0000
Such names and addresses may be changed by such notice.
3.3 Binding Effect; Benefit. This Agreement shall inure to the benefit
of and be binding upon the parties hereto and their respective successors, legal
representatives and permitted assigns. Nothing in this Agreement, expressed or
implied, is intended to confer upon any person other than the parties hereto and
their respective successors, legal representatives and permitted assigns, any
rights, obligations or liabilities under or by reason of this Agreement.
3.4 Assignability. This Agreement shall not be assignable by any party
without the prior written consent of each other party hereto.
3.5 Headings. The headings contained in this Agreement are for
convenience only and shall not affect the meaning or interpretation of this
Agreement.
3.6 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original and all of which
together shall be deemed to be one and the same instrument.
3.7 APPLICABLE LAW. ALL QUESTIONS CONCERNING THE CONSTRUCTION, VALIDITY
AND INTERPRETATION OF THIS AGREEMENT SHALL BE GOVERNED BY THE INTERNAL LAW OF
THE STATE OF DELAWARE, WITHOUT GIVING EFFECT TO PRINCIPLES OF CONFLICTS OF LAW.
IN WITNESS WHEREOF, the undersigned have hereto set their hands as of
the day and year first above written.
ARGO BANCORP, INC.
By: /s/ Xxxxxxx X. Xxxxx
Name: Xxxxxxx X. Xxxxx
Title: Senior Vice President & Corporate Secretary
THE DELTEC BANKING CORPORATION LIMITED
By: /s/ Xxxxxxx X. Xxxxxxx
Name: Xxxxxxx X. Xxxxxxx
Title: President
/s/ Xxxx X. Xxxxxxx
XXXX X. XXXXXXX
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