Exhibit 3
AMENDED AND RESTATED SHAREHOLDER AGREEMENT
THIS AMENDED AND RESTATED SHAREHOLDER AGREEMENT, dated as of this
29th day of February, 1996, is by and among Dartmouth Capital Group, Inc., a
Delaware corporation (the "Corporation"), Dartmouth Capital Group, L.P., a
Delaware limited partnership (the "Partnership"), Xxxxxx X. Xxxxxx ("Xxxxxx"),
and each of the persons signatory to a Signature Page to this Agreement (each
individually, a "Purchaser", and collectively, the "Purchasers", and
collectively with Xxxxxx, the "Shareholders") (all of the foregoing being
collectively referred to as the "Parties").
RECITALS
WHEREAS, the Partnership and the Corporation (which is the sole general
partner of the Partnership) have been organized for the purpose of identifying,
evaluating and acquiring equity or other interests in, or certain assets and
liabilities of, one or more financial institutions and/or similar or related
businesses (collectively, the "Venture");
WHEREAS, in order to provide the funds to conduct the first phase of
the Venture, the Corporation sold to the Purchasers shares ("Shares") of the
Corporation's common stock, par value $.01 (the "Common Stock"), pursuant to a
Capital Contribution and Shareholder Agreement dated as of May 22, 1995 among
the Parties (the "Original Agreement"), the net proceeds of which Shares were
contributed by the Corporation to the capital of the Partnership;
WHEREAS, the Parties have subsequently entered into a First Amendment
to Capital Contribution and Shareholder Agreement, dated as of May 23, 1995 (the
"First Amendment"), and a Second Amendment to Capital Contribution and
Shareholder Agreement, dated as of July 18, 1995 (the "Second Amendment"); and
WHEREAS, the Parties desire to amend and restate the Original Agreement
in order to incorporate each of the First Amendment and the Second Amendment, to
further amend the rights and obligations of each of the Parties, and to provide
for the possible admission of additional Persons as stockholders of the
Corporation and as Parties to this Agreement.
AGREEMENT
NOW, THEREFORE, in consideration of the premises contained herein and
for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties agree as follows:
1. DEFINITIONS. For purposes of this Agreement, capitalized terms not
defined in the preamble or the Recitals shall be defined as follows:
ACT shall mean the Securities Act of 1933, as amended.
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AFFILIATE shall mean a person or entity that directly, or
indirectly through one or more intermediaries, controls, or is
controlled by, or is under common control with, the person or entity
specified.
AGREEMENT shall mean this Amended and Restated Shareholder
Agreement.
BOOK-UP shall have the meaning given that term in Section 4
hereof.
CAPITAL ACCOUNT shall have the meaning given that term in the
Partnership Agreement.
CAPITAL CALL shall mean a Capital Call under, and as that term is
defined in, the Partnership Agreement and the Class A Subscription
Agreement.
CLASS A SUBSCRIPTION AGREEMENT shall mean a Subscription
Agreement entered into by a Shareholder (or his or her Investor
Affiliate) pursuant to the terms of the Partnership Agreement for the
purchase of Class A Interests.
INVESTOR AFFILIATE shall mean collectively, with respect to each
Shareholder, all of such Shareholder's Affiliates that are Partners.
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NOMINEE shall mean a person, if any, proposed and nominated by a
Shareholder in accordance with Section 5.1, or by a Nominating Limited
Partner in accordance with Section 5.2, to serve as a Director of the
Corporation.
NOMINATING LIMITED PARTNER shall have the meaning given that term
in Section 5.2 hereof.
PARTNER and CLASS A PARTNER shall have the meanings respectively
given those terms in the Partnership Agreement.
PARTNERSHIP AGREEMENT shall mean whichever of (i) the Agreement
of Limited Partnership by which the Partnership has been formed or (ii)
the Amended and Restated Agreement of Limited Partnership dated as of
February 29, 1996 restating the agreement referenced in the foregoing
clause (i), in each case as the same may be amended from time to time
and as in effect as of the applicable date.
TARGET BUSINESS shall have the meaning given that term in the
Partnership Agreement.
TARGET BUSINESS INVESTMENT shall mean any transaction in which
the Partnership will acquire an equity or other interest in, or certain
assets and liabilities of, any Target Business.
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2. REDEMPTION OF SHARES. Each Shareholder acknowledges that the
Partnership expects from time to time to make Capital Calls on the Shareholders
or their Investor Affiliates, in their respective capacities as Class A Partners
(to the extent the same remain Class A Partners), in the manner and in
accordance with the terms set forth in the Partnership Agreement. In the event
that a Shareholder or his or her Investor Affiliate fails to pay a Capital Call
within the time period set forth in the Partnership Agreement (including any
applicable notice or grace periods), the Corporation shall have the right, but
not the obligation, to repurchase all Shares then held by such Shareholder at a
price of $100 per Share. The Corporation's right to repurchase such
Shareholder's Shares under this Section shall be suspended 120 days after the
issuance of Class A Limited Partnership Interests to other Shareholders pursuant
to the same Capital Call until any subsequent default by such Shareholder on his
or her payment obligations arising out of any Capital Call.
3. RIGHT OF FIRST REFUSAL.
3.1 GENERALLY. Each Shareholder hereby grants each other Shareholder a
right of first refusal to purchase his or her Shares on the terms and subject to
the limitations contained in this Section 3.1 and in Section 3.2. In the event
that a Shareholder proposes to sell or otherwise transfer all or any portion of
his or her Shares to any person other than a person described in the last
sentence of this Section 3.1, the Shareholder shall give written notice of the
terms of such sale or transfer to each other Shareholder, offering the
applicable Shares to each other Shareholder on the identical terms. Each
Shareholder receiving such notice shall have twenty days from the date of the
notice in which to notify the selling Shareholder of the recipient Shareholder's
acceptance
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of the offer and intent to purchase the applicable Shares. In the event of
multiple acceptances of a single offer, the offered Shares shall be divided and
sold equally to all accepting Shareholders based upon the number of acceptances
tendered, unless the selling Shareholder and all accepting Shareholders shall
otherwise agree. If no recipient Shareholder accepts such offer, the selling
Shareholder may transfer the applicable Shares on the terms set forth in the
notice of intent to sell during the period ending ninety days following the date
of such notice, provided that the transferee executes and delivers to the
Corporation an Affirmation Agreement in the form attached hereto as Exhibit A.
The right of first refusal contained in this Section 3.1 shall not apply to
sales or other transfers to any Affiliate of such Shareholder or to any of such
Shareholder's immediate family members, including any trust or other vehicle for
the benefit of such persons.
3.2 SUSPENSION TO ADMIT NEW SHAREHOLDER PARTY. In the event the
Corporation determines, in accordance with Section 10, to admit additional
persons as Shareholders under this Agreement, and in order to facilitate the
admission of one or more such persons through transfers of then-outstanding
Shares, the Corporation may suspend temporarily the rights granted to existing
Shareholders under Section 3.1. Any such suspension shall apply solely to the
transfer to the persons, and in the transactions, contemplated by the
Corporation's determination under Section 10, and in the event such transfer
fails to occur the existing Shareholders' rights under Section 3.1 shall resume
without further action by the Corporation or any Shareholder.
4. AGREEMENT REGARDING BOOK-UP OF PARTNERSHIP ASSETS. The Parties
acknowledge that the Partnership Agreement provides that, immediately prior to
any contribution of additional
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capital to the Partnership, the General Partner of the Partnership may adjust
the Capital Account of each Partner to reflect the then-fair market value of the
Partnership's net assets (a "Book-up"). The Corporation and the Shareholders
hereby agree that, in the event that such capital is to be contributed to the
Partnership at any time on or before May 22, 2000, whether in connection with an
anticipated Target Business Investment or otherwise, they shall cause the
General Partner to effectuate such a Book-up.
5. VOTING AGREEMENT.
5.1 DESIGNATION OF DIRECTORS. Each Shareholder shall have the right to
nominate one person to serve as a Director of the Corporation. Each Shareholder
hereby agrees, subject to the provisions of Section 5.3 and any agreement
between the Company and a Nominating Limited Partner, to vote all Shares now or
hereafter owned or controlled, directly or indirectly, by such Shareholder and
otherwise to use his or her best efforts as a stockholder of the Corporation (i)
to set the number of Directors of the Corporation at a number equal to the
number of Nominees having been nominated for the applicable election, (ii) to
elect as Directors, at each election of Directors, each Nominee nominated for
election at such time, and (iii) not to vote to remove any Director so elected
during such Director's term unless (w) the Shareholder or Nominating Limited
Partner that nominated such Director so votes, or (x) such Director has breached
his or her fiduciary duties or been derelict in his or her duties to the
Corporation, or (y) such Director or the Shareholder or Nominating Limited
Partner that nominated such Director shall be a party to or otherwise
participate in any claim, proceeding or lawsuit (including derivative suits
brought in the name of the Corporation) against the Corporation, its officers,
Directors or stockholders, or (z)
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such Director has been convicted of any misdemeanor adversely affecting the
Company in any way, including its reputation, or any felony, or is barred by law
from serving as a Director of a bank or bank holding company. Any vacancy on the
Board created by the resignation, removal, incapacity or death of a Nominee
shall be filled by another person proposed and nominated by the applicable
Shareholder or Nominating Limited Partner.
5.2 AGREEMENTS WITH NOMINATING LIMITED PARTNERS. Upon the vote of
two-thirds of the Directors, the Company may enter into an agreement with a
non-Shareholder Limited Partner of the Partnership (a "Nominating Limited
Partner") whereunder such Nominating Limited Partner is granted the right to
designate a Director of the Company. In the event the Company enters into such
an agreement and the Nominating Limited Partner exercises its designation rights
thereunder by nominating a person to serve as a Director, such nominee shall
constitute a Nominee for purposes of Section 5.1 and each Shareholder agrees to
vote to elect such Nominee as a Director, subject only to the limitations
contained in Section 5.1 and the applicable agreement between the Company and
the Nominating Limited Partner.
5.3 TERMINATION OF DESIGNATION RIGHTS. Upon the earlier of (y) a
Shareholder's transfer of more than 50% of his or her Shares other than a
transfer to an Affiliate of such Shareholder or to one or more of such
Shareholder's immediate family members (including any trust or other vehicle for
the benefit of such persons), and (z) a default by a Shareholder on his or her
payment obligations relating to any Capital Call, the right of such Shareholder
(a "Passive Shareholder")
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to nominate a candidate for Director shall terminate, and each other
Shareholder's obligation to vote for, and not to vote to remove, the Passive
Shareholder's Nominee as a Director shall terminate.
6. REPRESENTATIONS, WARRANTIES AND COVENANTS.
6.1 BY THE PURCHASERS.
(a) SECURITIES LAW MATTERS. Each Purchaser acknowledges that the
Shares purchased by such Purchaser have not been registered under the Act, that
there is not, and the Corporation does not anticipate that there will be, any
market for the Shares, and that, whether or not such a market may hereafter
exist, the Shares cannot be offered, sold, pledged or otherwise transferred
within the meaning of the Act without an exemption from the registration
requirements of the Act. Each Purchaser further represents and warrants that (i)
he or she is an "accredited investor" within the meaning of Regulation D
promulgated under the Act, (ii) he or she has sufficient knowledge and
experience in business and financial matters to be capable of evaluating the
merits and risks of an investment in the Shares and of any further investment in
connection with any acquisition proposed as a result of the Venture, including
without limitation pursuant to a Capital Call by the Partnership, (iii) he or
she is able to bear the economic risks of an investment in the Shares and is, at
the present time, able to afford a complete loss of such investment, and (iv) he
or she is acquiring the Shares (or if the Shares were previously acquired, as of
the time of his or her acquisition of the Shares, he or she acquired the Shares)
for investment for his or her own account with no present intention of dividing
his or her interest with others or of reselling or otherwise distributing the
same in any transaction that would require registration under, or would be in
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violation of, the Act or any other securities law of the United States or of any
State, without prejudice, however, to a Purchaser's right to sell or otherwise
dispose of Shares under an effective registration statement or pursuant to an
exemption from registration under the Act. Each Purchaser agrees that, fifteen
days prior to any proposed transfer (other than a transfer pursuant to an
effective registration statement under the Act), the Purchaser shall give
written notice to the Corporation of such intended transfer, describing the
manner and circumstances of the proposed transfer and, if requested by the
Corporation, an opinion of counsel, reasonably satisfactory to the Corporation
and addressed to the Corporation, to the effect that the proposed transfer may
be effected without registration under the Act or any other securities law of
the United States or any State together with such representation letters and/or
other supporting materials as the Corporation may reasonably request.
(b) INFORMATION PROVIDED TO PURCHASER. Each Purchaser represents
and warrants that (i) such Purchaser has received and reviewed such information
regarding the organization, capitalization, financial condition and investments
of the Corporation and its Affiliates as such Purchaser has deemed necessary to
his or her decision to make an investment in the Shares, (ii) the Corporation or
its representatives have afforded such Purchaser and his or her advisors, if
any, the opportunity to discuss an investment in the Shares and to ask questions
concerning the Shares, the Corporation and the Venture, and the Corporation's
representatives have provided answers to all such questions, and (iii) such
Purchaser has not relied on any other Shareholder in determining to purchase
Shares hereunder.
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(c) EXECUTION AND AUTHORITY. Each Purchaser represents and
warrants that (i) such Purchaser has duly executed this Agreement, (ii) if such
Purchaser is not a natural person, the Purchaser's execution of this Agreement
and entrance into the other agreements hereunder, and its purchase of the
Shares, have been duly authorized by all necessary corporate or other action,
and the purchase of the Shares and the entrance into the Agreement has not
contravened and will not contravene its charter, by-laws or any law, regulation
or court order applicable to it, and (iii) such Purchaser is not a "creditor" as
such term is defined in Regulation T of the Board of Governors of the Federal
Reserve System.
8.2 BY THE CORPORATION AND THE PARTNERSHIP. Each of the Corporation and
the Partnership hereby jointly and severally makes the representations set forth
below as of the date hereof for the benefit of each of the initial Shareholders,
and as the date of admission of any additional Shareholder for the benefit of
such Shareholder:
(a) ORGANIZATIONAL MATTERS AND AUTHORIZATION OF AGREEMENT. Each
of the Corporation and the Partnership is duly authorized and validly existing
under the laws of the State of Delaware and has full power to perform its
obligations hereunder and to conduct its business as presently proposed to be
conducted. Each of the Corporation and the Partnership has taken all action
necessary to authorize its performance of the agreements contained in the
Agreement. The Agreement is the legal, valid and binding agreement of both the
Corporation and the Partnership, enforceable against the Corporation and the
Partnership in accordance with its terms, subject only to laws regarding
bankruptcy, insolvency, reorganization moratorium or otherwise affecting
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creditors' rights generally, and to the application of general principles of
equity (whether considered in a proceeding in law or at equity). Neither the
Corporation nor the Partnership is (i) in violation of its Certificate of
Incorporation or its by-laws (in the case of the Corporation) or its Certificate
of Limited Partnership or Partnership Agreement (in the case of the
Partnership), or (ii) to the knowledge of the Corporation and the Partnership,
in violation of any law, administrative regulation, or court or other
governmental decree or order applicable to it which violation would have a
material adverse effect on the Corporation or the Partnership, as applicable,
and the execution and delivery of this Agreement, the fulfillment of the terms
herein set forth and the consummation of the transactions herein contemplated
will not conflict with or constitute a breach of or a default under, the
Corporation's Certificate of Incorporation or its by-laws or the Partnership's
Certificate of Limited Partnership or Partnership Agreement, or any material
law, administrative regulation or court or governmental decree applicable to the
Corporation or the Partnership. Assuming that all representations and warranties
of all Purchasers are true and correct, no consent, approval, authorization or
other order of any regulatory body, administrative agency or other governmental
body was legally required by or on behalf of the Corporation for the valid
issuance and sale of the Shares sold under the Original Agreement or for the
consummation of the transactions contemplated herein.
(b) CAPITALIZATION AND EXPENSES. Schedule A attached hereto, as
amended from time to time, contains a true, accurate and complete listing of the
authorized and issued capital stock of the Corporation as of the date of this
Agreement. The Purchase Price stated on such Schedule A has been received by the
Corporation. The Corporation and the Partnership have no
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subsidiaries or Affiliates other than each other, those Shareholders
constituting Affiliates and those Target Businesses in which the Partnership has
heretofore consummated a Target Business Investment.
(c) OTHER MATTERS. There are no actions, suits, or legal
proceedings before or by any court or governmental agency or body pending or, to
the knowledge of the Corporation or the Partnership, threatened, to which the
Corporation or the Partnership is a party or of which the business or property
of the Corporation or the Partnership is the subject that relate to or challenge
the legality, validity or enforceability of this Agreement or any other
documents or agreement executed or to be executed by the Corporation or the
Partnership pursuant hereto or thereto or in connection herewith or therewith.
9. ASSIGNMENT. A Shareholder's rights under this Agreement are
assignable only with the prior written consent of the Corporation, which may be
granted or withheld in the Corporation's sole discretion.
10. ADDITION OF NEW SHAREHOLDERS. Each Party acknowledges that the
Corporation may, from time to time, (i) deem it desirable to sell additional
shares of Common Stock, or (ii) deem it desirable to facilitate one or more
transfers of then-outstanding Shares, in each case on terms providing for the
purchasers or transferees of such Common Stock to be afforded the same rights as
are afforded the Shareholders hereunder. The Parties agree that, upon a
two-thirds vote of the Board of Directors of the Corporation, the Corporation
may admit such a purchaser or transferee
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as a Shareholder under this Agreement, with all of the rights, privileges and
obligations as held by those persons who are Shareholders under this Agreement
as initially executed, such admission to be effected by the new Shareholder's
and the Corporation's execution of a counterpart signature page of this
Agreement. By the execution of such a signature page, the new Shareholder shall
be deemed to agree to each of the terms of this Agreement, including each of the
representations and warranties made by a Shareholder as are contained herein.
Any shares of Common Stock issued or transferred to such a new Shareholder will
be deemed "Shares" for all purposes under this Agreement. A transferee of Shares
who is admitted as a Shareholder pursuant to this Section 10 shall not be
required to execute an Affirmation Agreement.
11. AMENDMENT. Except as provided in the last sentence of this Section
11, this Agreement may be amended (including by restatement in its entirety) by
an instrument in writing executed by (i) the Corporation, acting upon a
two-thirds vote of its Board of Directors, and (ii) two-thirds (in number) of
the Shareholders as of the applicable time. Any such amendment shall be binding
upon all Parties, whether or not any such Party has executed such instrument of
amendment. Notwithstanding the foregoing, Sections 4 and 5 may be amended only
by an instrument in writing executed by all Parties.
12. GOVERNING LAW. This Agreement shall be governed by the internal laws
of the State of Delaware without giving effect to the conflicts of laws
principles thereof.
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13. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, all of which shall constitute a single instrument, and each such
counterpart shall constitute an original.
14. ENTIRE AND BINDING AGREEMENT; EFFECT ON PRIOR AGREEMENTS. This
Agreement reflects the entire agreement of the Parties relating to the subject
matter contained herein, supersedes all prior agreements of the parties relating
to such subject matter, including without limitation the Original Agreement, the
First Amendment and the Second Amendment, and is binding upon the Parties and
their respective assigns and inuring to the extent provided herein to the
benefit of the Parties and their respective permitted assigns. The Original
Agreement, as amended by the First Amendment and the Second Amendment, is hereby
terminated and shall hereafter be of no further force or effect.
IN WITNESS WHEREOF, the parties have set their hands and seals as of
the first date recited above.
DARTMOUTH CAPITAL GROUP, INC.
By: /s/ Xxxxxx X. Xxxxxx
---------------------------------
Xxxxxx X. Xxxxxx, President
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DARTMOUTH CAPITAL GROUP, L.P.
By: DARTMOUTH CAPITAL GROUP, INC.
Its General Partner
By: /s/ Xxxxxx X. Xxxxxx
---------------------------
Xxxxxx X. Xxxxxx, President
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[SIGNATURE PAGE TO AMENDED AND RESTATED SHAREHOLDER AGREEMENT]
[DATED AS OF FEBRUARY 29, 1996]
XXXXXX:
/s/ Xxxxxx X. Xxxxxx
-------------------------------------
Xxxxxx X. Xxxxxx
PURCHASERS:
/s/ Xxxxxx X. Xxxx
-------------------------------------
Xxxxxx X. Xxxx
/s/ Xxxx X. Xxxxx
-------------------------------------
Xxxx X. Xxxxx
/s/ Xxxxxx X. Xxx
-------------------------------------
Xxxxxx X. Xxx
/s/ Xxxxxxx X. Xxxxx
-------------------------------------
Xxxxxxx X. Xxxxx
/s/ K. Xxxxxx Xxxx
-------------------------------------
K. Xxxxxx Xxxx
/s/ Xxxxxxxxx X. Xxxxx
-------------------------------------
Xxxxxxxxx X. Xxxxx
NORTHWOOD CAPITAL PARTNERS LLC
By: /s/ Xxxxx X. Xxxxxx
----------------------------------
Xxxxx X. Xxxxxx
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NORTHWOOD VENTURES
By: /s/ Xxxxx X. Xxxxxx
---------------------------------
Xxxxx X. Xxxxxx
/s/ Xxxx X. X. Xxxxxxxx
-------------------------------------
Xxxx X. X. Xxxxxxxx
/s/ Xxxxxx X. Xxxxx
-------------------------------------
Xxxxxx X. Xxxxx
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SCHEDULE A
To Amended and Restated Shareholder Agreement
Dated as of February 29, 1996.
Purchaser Number of Shares Held Aggregate Purchase Price Paid
--------- --------------------- -----------------------------
Xxxxxx X. Xxxx 300 $30,000
Xxxx X. Xxxxx 400 40,000
Xxxxxx X. Xxx 195 19,500
Xxxxxxx X. Xxxxx 125 12,500
Xxxxxx X. Xxxxxx 50 5,000
K. Xxxxxx Xxxx 100 10,000
Xxxxxxxxx X. Xxxxx 400 40,000
Northwood Ventures 120 12,000
Northwood Capital Partners LLC 30 3,000
Xxxx X. X. Xxxxxxxx 125 12,500
Xxxxxx X. Xxxxx 100 10,000
