EXHIBIT 1.2
CATSKILL FINANCIAL CORPORATION STOCK OPTION AGREEMENT
THE TRANSFER OF THE OPTION GRANTED
BY THIS AGREEMENT IS SUBJECT TO RESALE RESTRICTIONS.
This STOCK OPTION AGREEMENT, dated as of June 7, 2000 (this
"Agreement"), is entered into between Catskill Financial Corporation, a Delaware
corporation ("Issuer"), and Xxxx Financial Corporation, a Delaware corporation
("Grantee").
WITNESSETH:
WHEREAS, Grantee, Charlie Acquisition Corporation, a
Delaware corporation, and Issuer have entered into an Agreement and Plan of
Merger, dated as of
even date with this Agreement (the "Plan"), which was executed by the parties
thereto prior to the execution of this Agreement; and
WHEREAS, as a condition and inducement to Grantee's
entering into the Plan and in consideration therefor, Issuer has agreed to grant
Grantee the
Option (as defined below).
NOW, THEREFORE, in consideration of the foregoing and
the mutual covenants and agreements set forth herein and in the Plan, the
parties hereto agree
as follows:
SECTION 1. Issuer hereby grants to Grantee an irrevocable option
(the "Option") to purchase, subject to the terms hereof, up to a number of fully
paid and nonassessable shares of common stock, par value $0.01 per share of
Issuer ("Issuer Common Stock") equal to 19.9% of the total of the number of
issued and outstanding shares of Issuer Common Stock as of the first date that
the Option becomes exercisable, at a price per share equal to $19.00 (the
"Option Price").
SECTION 2. (a) Grantee may exercise the Option, in whole or part, at
any time and from time to time following the occurrence of a Purchase Event (as
defined below); provided, however, that the Option shall terminate and be of no
further force and effect upon the earliest to occur of the following events
(which are collectively referred to as an "Exercise Termination Event"):
(i) The time immediately prior to the Effective Time (as
defined in the Plan);
(ii) 18 months after the first occurrence of a Purchase
Event;
(iii) 18 months after the termination of the Plan
following the occurrence of a Preliminary Purchase Event
(as defined below);
(iv) upon the valid termination of the Plan, if no
Purchase Event or Preliminary Purchase Event has occurred
prior to such termination, by Issuer pursuant to Sections
8.1(e) or 8.1(f) of the Plan as a result of a breach by
Grantee, both parties pursuant to Section 8.1(a) of the
Plan, or by either party pursuant to Sections 8.1(b) or
8.1(c) of the Plan;
(v) 18 months after the termination of the Plan, by
either party pursuant to Section 8.1(d) of the Plan based
on the required vote of Issuer's stockholders not being
obtained at a duly called meeting of the stockholders of
the Issuer, if no Purchase Event or Preliminary Purchase
Event has occurred prior to the meeting of Issuer's
stockholders (or any adjournment or postponement thereof)
held to vote on the Plan; or
(vi) 18 months after the termination of the Plan, by
Grantee pursuant to Sections 8.1(e) or 8.1(f) thereof as a
result of a breach by Issuer, or by Grantee pursuant to
Sections 8.1(g) or (h) of the Plan.
(b) The term "Preliminary Purchase Event" shall mean any
of the following events or transactions occurring on or after the date hereof
and prior to an Exercise Termination Event:
(i) Issuer without having received Grantee's prior
written consent, shall have entered into any letter of intent or
definitive agreement to engage in an Acquisition Transaction (as
defined below) with any person (as defined below) other than Grantee
or any of its subsidiaries (each a "Grantee Subsidiary") or the
Board of Directors of Issuer shall have recommended that the
stockholders of Issuer approve or accept any Acquisition Transaction
with any Person (as the term "person" is defined in Sections 3(a)9
and 13(d)(3) of the Exchange Act and the rules and regulations
thereunder) other than Grantee or any Grantee Subsidiary. For
purposes of this Agreement, "Acquisition Transaction" shall mean (x)
a merger, consolidation or other business combination involving
Issuer, (y) a purchase, lease or other acquisition of all or
substantially all of the assets of Issuer, (z) a purchase or other
acquisition (including by way of merger, consolidation, share
exchange or otherwise) of Beneficial Ownership (as the term
"beneficial ownership" is defined in Regulation 13d-3(a) of the
Exchange Act) of securities representing 20% or more of the voting
power of Issuer; provided, however, that "Acquisition Transaction"
shall not include a transaction entered into after the termination
of the Plan in which the Issuer is the surviving entity, if in
connection with such transaction, no person acquires Beneficial
Ownership of 20% or more of the total voting power of the Issuer to
be outstanding after giving effect to such transaction and in which
the aggregate voting power of Issuer acquired by all persons is less
than 33% of the total voting power of Issuer;
(ii) Any Person (other than Grantee, any Grantee
Subsidiary or any current affiliate of Issuer) shall have acquired
Beneficial Ownership of 20% or more of the outstanding shares of
Issuer Common Stock;
(iii) (a) Any Person (other than Grantee or any
Grantee Subsidiary) shall have made a bona fide proposal to Issuer
or, by a public announcement or written communication that is or
becomes the subject of public disclosure, to Issuer's stockholders
prior to the Catskill Stockholders' Meeting to engage in an
Acquisition Transaction (including, without limitation, any
situation in which any Person other than Grantee or any Grantee
Subsidiary shall have commenced (as such term is defined in Rule
14d-2 promulgated under the Exchange Act of 1934, as amended (the
"Exchange Act"), or shall have filed a registration statement under
the Securities Act of 1933, as amended (the "Securities Act"), with
respect to a tender offer or exchange offer to purchase any shares
of Issuer Common Stock such that, upon consummation of such offer,
such person would have Beneficial Ownership of 20% or more of the
then outstanding shares of Issuer Common Stock (such an offer being
referred to herein as a "Tender Offer" or an "Exchange Offer",
respectively) and (b) the stockholders of Issuer do not approve the
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Merger, as defined in the Plan, at a meeting of the Issuer's
stockholders;
(iv) There shall exist a willful or intentional
breach under the Plan by Issuer and such breach would entitle
Grantee to terminate the Plan; or
(v) The meeting of the Issuer's stockholders to be
held for the purpose of voting on the Plan shall
not have been held pursuant to the Plan or shall have been canceled
prior to termination of the Plan, or for any reason whatsoever
Issuer's Board of Directors shall have failed to recommend, or shall
have withdrawn or modified in a manner adverse to Grantee the
recommendation of Issuer's Board of Directors, that Issuer's
stockholders approve the Plan, or if Issuer or Issuer's Board of
Directors fails to oppose any proposal of the type described at
Section 2(b)(iii)(a) above by any Person (other than Grantee or any
Grantee Subsidiary).
(c) The term "Purchase Event" shall mean any of the
following events or transactions occurring on or after the date hereof and prior
to an Exercise Termination Event:
(i) The acquisition by any Person (other than
Grantee or any Grantee Subsidiary) of Beneficial
Ownership (other than on behalf of the Issuer) of 20% or
more of the then outstanding Issuer Common Stock;
(ii) The occurrence of a Preliminary Purchase
Event described in Section 2(b)(i); or
(iii) The termination of the Plan by Grantee
pursuant to Section 8.1(h) thereof.
(d) Issuer shall notify Grantee promptly in writing of
the occurrence of any Preliminary Purchase Event or Purchase Event known to
Issuer; provided, however, that the giving of such notice by Issuer shall not be
a condition to the right of Grantee to exercise the Option.
(e) In the event that Grantee is entitled to and wishes
to exercise the Option, it shall send to Issuer a written notice (the "Option
Notice," the date of which being hereinafter referred to as the "Notice Date")
specifying (i) the total number of shares of Issuer Common Stock it will
purchase pursuant to such exercise and (ii) the time (which shall be on a
business day that is not less than three nor more than 10 business days from the
Notice Date) on which the closing of such purchase shall take place (the
"Closing Date"); such closing to take place at the principal office of the
Issuer; provided, however, that if prior notification to or approval of the
Board of Governors of the Federal Reserve System ("FRB"), Office of the
Comptroller of the Currency ("OCC"), the Office of Thrift Supervision ("OTS"),
the New York State Banking Department ("NYSBD"), the Federal Trade Commission
(the "FTC"), the Antitrust Division of the Department of Justice ("DOJ") or any
other Governmental Authority is required in connection with such purchase (each,
a "Notification" or an "Approval," as the case may be), at Grantee's sole
expense, (a) Grantee shall promptly file the required notice or application for
approval ("Notice/Application"), (b) Grantee shall expeditiously process the
Notice/Application and (c) for the purpose of determining the Closing Date
pursuant to clause (ii) of this sentence, the period of time that otherwise
would run from the Notice Date shall instead run from the later of (x) in
connection with any Notification, the date on which any required notification
periods have expired or been terminated and (y) in connection with any Approval,
the date on which such approval has been obtained and any requisite waiting
period or periods shall have expired. For purposes of Section 2(a) hereof, any
exercise of the Option shall be deemed to occur on the Notice Date relating
thereto. Prior to the Closing Date, Grantee shall have the right to revoke its
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exercise of the Option by written notice to the Issuer given not less than three
business days prior to the Closing Date.
(f) At the closing referred to in Section 2(e) hereof,
Grantee shall pay to Issuer the aggregate purchase price for the number of
shares of Issuer Common Stock specified in the Option Notice in immediately
available funds by wire transfer to a bank account designated by Issuer;
provided, however, that failure or refusal of Issuer to designate such a bank
account shall not preclude Grantee from exercising the Option.
(g) At such closing, simultaneously with the delivery of
immediately available funds as provided in Section 2(f) hereof, Issuer shall
deliver to Grantee a certificate or certificates representing the number of
shares of Issuer Common Stock specified in the Option Notice and, if the Option
should be exercised in part only, a new Option evidencing the rights of Grantee
thereof to purchase the balance of the shares of Issuer Common Stock purchasable
hereunder.
(h) Certificates for Issuer Common Stock delivered at a
closing hereunder shall be endorsed with a restrictive legend substantially as
follows:
THE TRANSFER OF THE SHARES REPRESENTED BY
THIS CERTIFICATE IS SUBJECT TO RESALE RESTRICTIONS
ARISING UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
AND APPLICABLE STATE SECURITIES LAWS.
It is understood and agreed that the reference to the resale restrictions of the
Securities Act in the above legend shall be removed by delivery of substitute
certificate(s) without such reference if Grantee shall have delivered to Issuer
a copy of a letter from the staff of the Securities and Exchange Commission (the
"SEC") or Governmental Authority responsible for administering any applicable
state securities laws or an opinion of counsel to the effect that such legend is
not required for purposes of the Securities Act or applicable state securities
laws. In addition such certificates shall bear any other legend as may be
required by law.
(i) Upon the giving by Grantee to Issuer of an Option
Notice and the tender of the applicable purchase price in immediately available
funds on the Closing Date, unless prohibited by applicable law, Grantee shall be
deemed to be the holder of record of the number of shares of Issuer Common Stock
specified in the Option Notice, notwithstanding that the stock transfer books of
Issuer shall then be closed or that certificates representing such shares of
Issuer Common Stock shall not then actually be delivered to Grantee. Issuer
shall pay all expenses and other charges that may be payable in connection with
the preparation, issuance and delivery of stock certificates under this Section
2 in the name of Grantee.
SECTION 3. Issuer agrees: (i) that it shall at all times until the
termination of this Agreement have reserved for issuance upon the exercise of
the Option that number of authorized and reserved shares of Issuer Common Stock
equal to the maximum number of shares of Issuer Common Stock at any time and
from time to time issuable hereunder, all of which shares will, upon issuance
pursuant hereto, be duly authorized, validly issued, fully paid, non-assessable,
and delivered free and clear of all claims, liens, encumbrances and security
interests and not subject to any preemptive rights; (ii) that it will not, by
amendment of its certificate of incorporation or through reorganization,
consolidation, merger, dissolution or sale of assets, or by any other voluntary
act, avoid or seek to avoid the observance or performance of any of the
covenants, stipulations or conditions to be observed or performed hereunder by
Issuer; (iii) promptly to take all reasonable action as may from time to time be
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requested by Grantee, at Grantee's expense (including (x) complying with all
premerger notification, reporting and waiting period requirements specified in
15 U.S.C. ss. 18a and regulations promulgated thereunder and (y) in the event
prior approval of or notice to the FRB, OCC, FTC, DOJ or any other Governmental
Authority, under the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as
amended, the Bank Holding Company Act, the Change in Bank Control Act, the Home
Owners' Loan Act of 1933, as amended, or any other applicable federal or state
law, is necessary before the Option may be exercised), cooperating with Grantee
in preparing such applications or notices and providing such information to each
such Governmental Authority as it may require in order to permit Grantee to
exercise the Option and Issuer duly and effectively to issue shares of Issuer
Common Stock pursuant hereto; and (iv) to take all action provided herein to
protect the rights of Grantee against dilution.
SECTION 4. This Agreement (and the Option granted hereby) are
exchangeable, without expense, at the option of Grantee, upon presentation and
surrender of this Agreement at the principal office of Issuer, for other
agreements providing for Options of different denominations entitling the holder
thereof to purchase, on the same terms and subject to the same conditions as are
set forth herein, in the aggregate the same number of shares of Issuer Common
Stock purchasable hereunder. The terms "Agreement" and "Option" as used herein
include any agreements and related options for which this Agreement (and the
Option granted hereby) may be exchanged. Upon receipt by Issuer of evidence
reasonably satisfactory to it of the loss, theft, destruction or mutilation of
this Agreement, and (in the case of loss, theft or destruction) of reasonably
satisfactory indemnification, and upon surrender and cancellation of this
Agreement, if mutilated, Issuer will execute and deliver a new Agreement of like
tenor and date.
SECTION 5. The number of shares of Issuer Common Stock purchasable
upon the exercise of the Option shall be subject to adjustment from time to time
as follows:
(a) In the event of any change in the type or number of
shares of Issuer Common Stock by reason of stock dividends, split-ups, mergers,
recapitalizations, combinations, subdivisions, conversions, exchanges of shares
or other issuances of additional shares (other than pursuant to the exercise of
the Option), the type and number of shares of Issuer Common Stock purchasable
upon exercise hereof shall be appropriately adjusted and proper provision shall
be made so that, in the event that any additional shares of Issuer Common Stock
are to be issued or otherwise become outstanding as a result of any such change
(other than pursuant to an exercise of the Option), the number of shares of
Issuer Common Stock that remain subject to the Option shall be increased or
decreased (as applicable) so that, after such issuance and together with the
shares of Issuer Common Stock previously issued pursuant to the prior partial
exercise of the Option (as adjusted on account of any of the foregoing changes
in the Issuer Common Stock), such number of shares shall equal the sum of 19.9%
of the total of the number of shares of Issuer Common Stock issued and
outstanding on the date the Option first becomes exercisable.
(b) Whenever the number of shares of Issuer Common Stock
purchasable upon exercise hereof is adjusted as provided in this Section 5, the
Option Price shall be adjusted by multiplying the Option Price by a fraction,
the numerator of which shall be equal to the number of shares of Issuer Common
Stock purchasable prior to the adjustment and the denominator of which shall be
equal to the number of shares of Issuer Common Stock purchasable after the
adjustment.
SECTION 6. (a) Upon the occurrence of a Purchase Event that occurs
prior to an Exercise Termination Event, Issuer shall, at the request of Grantee
(whether on its own behalf or on behalf of any subsequent holder of the Option
(or part thereof) or of any of the shares of Issuer Common Stock issued pursuant
hereto), promptly prepare, file and keep current a shelf registration statement
with the SEC, under the Securities Act covering any shares issued and issuable
pursuant to the Option and shall use its reasonable best efforts to cause such
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registration statement to become effective, and to remain current and effective
for a period not in excess of 180 days from the day such registration statement
first becomes effective, in order to permit the sale or other disposition of any
shares of Issuer Common Stock issued upon total or partial exercise of the
Option ("Option Shares") in accordance with any plan of disposition requested by
Grantee. Grantee shall have the right to demand two such registrations, which
demand right shall be transferable but in no event shall Issuer be required to
effect more than two registrations in the aggregate pursuant to this Option or
any subdivision hereof. Grantee shall provide all information reasonably
requested by Issuer for inclusion in any registration statement to be filed
hereunder. In connection with any such registration statement, Issuer and
Grantee shall provide each other with representations, warranties, indemnities
and other agreements customarily given in connection with such registration. If
requested by Grantee in connection with such registration, Issuer and Grantee
shall become a party to any underwriting agreement relating to the sale of such
shares, but only to the extent of obligating themselves in respect of
representations, warranties, indemnities and other agreements customarily
included in such underwriting agreements and reasonably acceptable to Issuer.
Notwithstanding the foregoing, if Grantee revokes any exercise notice or fails
to exercise any Option with respect to any exercise notice pursuant to Section
2(e) hereof, Issuer shall not be obligated to continue any registration process
with respect to the sale of Option Shares issuable upon the exercise of such
Option and Grantee shall not be deemed to have demanded registration of Option
Shares. If Issuer withdraws a registration statement which has been declared
effective at the request of Grantee, or any subsequent holder, then such filing
shall be deemed an effective registration for all purposes hereunder. The Issuer
will not be required to file any such registration statement during any period
of time (not to exceed 30 days in the case of clauses (A) or (C) below or 45
days in the case of clause (B) below) when (A) the Issuer is in possession of
material non-public information which it reasonably believes would be
detrimental to be disclosed at such time and such information would have to be
disclosed if a registration statement were filed at that time; (B) the Issuer is
required under the Securities Act and the rules and regulations thereunder to
include audited financial statements for any period in such registration
statement and such financial statements are not yet available for inclusion in
such registration statement; or (C) the Issuer reasonably determines that such
registration would interfere with any financing, acquisition or material
transaction involving the Issuer. The registration rights set forth in this
Section 6 are subject to the condition that the Grantee or subsequent holder
shall provide the Issuer with such information with respect to the holder's
securities, the plan for distribution thereof, and such other information with
respect to the holder that is required under applicable securities laws to
enable the Issuer to include in a registration statement all material facts
required to be disclosed with respect to a registration thereunder, including
the identity of the holder and the holder's plan of distribution. The Grantee
shall not be able to exercise its registration rights hereunder if Grantee can
rely on Rule 144 promulgated under the Securities Act to sell such number of
shares of Issuer Common Stock that the Grantee otherwise would seek to register.
(b) Concurrently with the preparation and filing of a
registration statement under Section 6(a) hereof, Issuer shall also make all
filings required to comply with state securities laws in such number of states
as Grantee may reasonably request; provided, that Issuer shall not be required
to qualify to do business in, or consent to service of process in, any
jurisdiction by reason of this provision.
SECTION 7. (a) Upon the occurrence of a Purchase Event that occurs
prior to an Exercise Termination Event, at the request (the date of such request
being the "Option Repurchase Request Date") of Grantee, Issuer shall repurchase,
subject to compliance with applicable law and out of funds legally available
therefor, the Option from Grantee at a price (the "Option Repurchase Price")
equal to the amount by which (A) the market/offer price (as defined below)
exceeds (B) the Option Price, multiplied by the number of shares for which the
Option may then be exercised. The term "market/offer price" shall mean the
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highest of (i) the price per share of Issuer Common Stock at which a tender
offer or exchange offer therefor has been made after the date hereof and on or
prior to the Option Repurchase Request Date (ii) the price per share of Issuer
Common Stock paid or to be paid by any third party pursuant to an agreement with
Issuer (whether by way of a merger, consolidation or otherwise), (iii) the
average of the 20 highest last sale prices for shares of Issuer Common Stock as
reported within the 90-day period ending on the Option Repurchase Request Date,
and (iv) in the event of a sale of all or substantially all of Issuer's assets,
the sum of the price paid in such sale for such assets and the current market
value of the remaining assets of Issuer as determined by an investment banking
firm selected by Grantee and reasonably acceptable to Issuer, divided by the
number of shares of Issuer Common Stock outstanding at the time of such sale. In
determining the market/offer price, the value of consideration other than cash
shall be the value determined by an investment banking firm selected by Grantee
and reasonably acceptable to Issuer. The investment banking firm's determination
shall be conclusive and binding on all parties.
(b) Grantee may exercise its right to require Issuer to repurchase
the Option pursuant to this Section 7 by surrendering for such purpose to
Issuer, at its principal office, a copy of this Agreement, accompanied by a
written notice or notices stating that Grantee elects to require Issuer to
repurchase the Option in accordance with the provisions of this Section 7. As
promptly as practicable, and in any event within 30 business days after the
surrender of the Option and the receipt of such notice or notices relating
thereto, Issuer shall deliver or cause to be delivered to Grantee the Option
Repurchase Price.
(c) Issuer hereby undertakes to use its reasonable best efforts to
obtain all required regulatory, shareholder and legal approvals and to file any
required notices as promptly as practicable in order to accomplish any
repurchase contemplated by this Section 7. Nonetheless, to the extent that
Issuer is prohibited under applicable law or regulation from repurchasing the
Option in full, Issuer shall promptly so notify Grantee and thereafter deliver
or cause to be delivered, from time to time, to Grantee the portion of the
Option Repurchase Price that it is no longer prohibited from delivering, within
five business days after the date on which Issuer is no longer so prohibited;
provided, however, that if Issuer at any time after delivery of a notice of
repurchase pursuant to Section 7(b) hereof is prohibited as referred to above,
from delivering to Grantee the Option Repurchase Price in full, Grantee may
revoke its notice of repurchase of the Option either in whole or in part
whereupon, in the case of a revocation in part, Issuer shall promptly (i)
deliver to Grantee that portion of the Option Purchase Price that Issuer is not
prohibited from delivering after taking into account any such revocation and
(ii) deliver, as appropriate, to Grantee, a new Agreement evidencing the right
of Grantee to purchase that number of shares of Issuer Common Stock equal to the
number of shares of Issuer Common Stock purchasable immediately prior to the
delivery of the notice of repurchase less the number of shares of Issuer Common
Stock covered by the portion of the Option repurchased.
(d) Issuer shall not enter into any agreement with any
Person (other than Grantee or a Grantee Subsidiary) for an Acquisition
Transaction unless the other Person assumes all the obligations of Issuer
pursuant to this Section 7 in the event that Grantee elects, in its sole
discretion, to require such other Person to perform such obligations.
SECTION 8. Notwithstanding Sections 2 and 6 hereof, if Grantee has
given the notice referred to in one or more of such Sections, the exercise of
the rights specified in any such Section shall be extended (a) if the exercise
of such rights requires obtaining regulatory approvals (including any required
waiting periods) to the extent necessary to obtain all regulatory approvals for
the exercise of such rights, and (b) to the extent necessary to avoid liability
under Section 16(b) of the Exchange Act by reason of such exercise; provided,
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that in no event shall any closing date occur more than 12 months after the
related notice date, and, if the closing date shall not have occurred within
such period due to the failure to obtain any required approval by the FRB, OCC,
OTS, FTC, DOJ or any other Governmental Authority despite the reasonable best
efforts of Grantee and Issuer to obtain such approvals, the exercise of the
rights shall be deemed to have been rescinded as of the related notice date. In
the event (a) Grantee receives official notice that an approval of the FRB, OCC,
FTC, DOJ or any other Governmental Authority required for the purchase and sale
of the Option Shares will not be issued or granted or (b) a closing date has not
occurred within 12 months after the related notice date due to the failure to
obtain any such required approval, Grantee shall be entitled to exercise the
Option in connection with the concurrent resale of the Option Shares pursuant to
a registration statement as provided in Section 6 hereof.
SECTION 9. Issuer hereby represents and warrants to Grantee as
follows:
(a) Issuer has the requisite corporate power and
authority to execute and deliver this Agreement and to consummate the
transactions contemplated hereby. The execution and delivery of this Agreement
and the consummation of the transactions contemplated hereby have been duly
approved by the Board of Directors of Issuer and no other corporate proceedings
on the part of Issuer are necessary to authorize this Agreement or to consummate
the transactions so contemplated. This Agreement has been duly executed and
delivered by, and constitutes a valid and binding obligation of, Issuer,
enforceable against Issuer in accordance with its terms, subject to any required
Governmental Approval, and except as enforceability thereof may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium and other similar
laws affecting the enforcement of creditors' rights generally and general
principles of equity.
(b) Issuer has taken all necessary corporate action to
authorize and reserve and to permit it to issue, and at all times from the date
hereof through the termination of this Agreement in accordance with its terms
will have reserved for issuance upon the exercise of the Option, that number of
shares of Issuer Common Stock equal to the maximum number of shares of Issuer
Common Stock at any time and from time to time issuable hereunder, and all such
shares, upon issuance pursuant hereto, will be duly authorized, validly issued,
fully paid, non-assessable, and will be delivered free and clear of all claims,
liens, encumbrances and security interests and not subject to any preemptive
rights.
SECTION 10. (a) Neither of the parties hereto may assign any of its
rights or delegate any of its obligations under this Agreement or the Option
created hereunder to any other Person without the express written consent of the
other party, except that Grantee may assign this Agreement to a wholly owned
subsidiary of Grantee and Grantee may assign its rights hereunder in whole or in
part after the occurrence of a Preliminary Purchase Event. The term "Grantee" as
used in this Agreement shall also be deemed to refer to Grantee's permitted
assigns.
(b) Any assignment of rights of Grantee to any permitted
assignee of Grantee hereunder shall bear the restrictive legend at the beginning
thereof substantially as follows:
THE TRANSFER OF THE OPTION REPRESENTED BY THIS
ASSIGNMENT AND THE RELATED OPTION AGREEMENT IS SUBJECT TO RESALE
RESTRICTIONS ARISING UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
AND APPLICABLE STATE SECURITIES LAWS AND TO CERTAIN PROVISIONS OF AN
AGREEMENT BETWEEN CATSKILL FINANCIAL CORPORATION AND XXXX FINANCIAL
CORPORATION ("XXXX"), DATED AS OF JUNE 7, 2000. A COPY OF SUCH
AGREEMENT IS ON FILE AT THE PRINCIPAL OFFICE OF XXXX, AND WILL BE
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PROVIDED TO ANY PERMITTED ASSIGNEE OF THE OPTION WITHOUT CHARGE UPON
RECEIPT OF A WRITTEN REQUEST THEREFOR.
SECTION 11. Each of Grantee and Issuer will use its reasonable
efforts to make all filings with, and to obtain consents of, all third parties
including, if applicable, the FRB, OCC, FTC, DOJ and other Governmental
Authorities necessary to the consummation of the transactions contemplated by
this Agreement.
SECTION 12. The parties hereto acknowledge that damages would be an
inadequate remedy for a breach of this Agreement by either party hereto and that
the obligations of the parties hereto shall be enforceable by either party
hereto through injunctive or other equitable relief. Both parties further agree
to waive any requirement for the securing or posting of any bond in connection
with the obtaining of any such equitable relief and that this provision is
without prejudice to any other rights that the parties hereto may have for any
failure to perform this Agreement.
SECTION 13. If any term, provision, covenant or restriction
contained in this Agreement is held by a court or a federal or state regulatory
agency of competent jurisdiction to be invalid, void or unenforceable, the
remainder of the terms, provisions and covenants and restrictions contained in
this Agreement shall remain in full force and effect, and shall in no way be
affected, impaired or invalidated. If for any reason such court or regulatory
agency determines that Grantee is not permitted to acquire or Issuer is not
permitted to repurchase pursuant to Section 7 hereof, the full number of shares
of Issuer Common Stock provided in Section 1 hereof (as adjusted pursuant
hereto), it is the express intention of Issuer to allow Grantee to acquire or to
require Issuer to repurchase such lesser number of shares as may be permissible
without any amendment or modification hereof.
SECTION 14. All notices, requests, claims, demands and other
communications hereunder shall be deemed to have been duly given when delivered
in the manner and at the respective addresses of the parties set forth in the
Plan.
SECTION 15. This Agreement, the rights and obligations of the
parties hereto, and any claims or disputes relating thereto shall be governed by
and construed in accordance with the laws of the State of Delaware (but not
including the choice of law rules thereof).
SECTION 16. This Agreement may be executed in counterparts, each of
which shall be deemed to be an original, but all of which shall constitute one
and the same agreement and shall be effective at the time of execution and
delivery.
SECTION 17. Except as otherwise expressly provided herein, each of
the parties hereto shall bear and pay all costs and expenses incurred by it or
on its behalf in connection with the transactions contemplated hereunder.
SECTION 18. Except as otherwise expressly provided herein or in the
Plan, this Agreement contains the entire agreement between the parties with
respect to the transactions contemplated hereunder and supersedes all prior
arrangements or understandings with respect thereof, written or oral. The terms
and conditions of this Agreement shall inure to the benefit of and be binding
upon the parties hereto and their respective successors and permitted assigns.
Nothing in this Agreement, expressed or implied, is intended to confer upon any
party, other than the parties hereto, and their respective successors except as
assigns, any rights, remedies, obligations or liabilities under or by reason of
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this Agreement, except as expressly provided herein.
SECTION 19. Capitalized terms used in this Agreement and not defined
herein but defined in the Plan shall have the meanings assigned therein.
SECTION 20. Nothing contained in this Agreement shall be deemed to
authorize or require Issuer or Grantee to breach any provision of the Plan or
any provision of law applicable to the Grantee or Issuer.
SECTION 21. In the event that any selection or determination is to
be made by Grantee or a subsequent holder hereunder and at the time of such
selection or determination there is more than one Grantee or holders, such
selection shall be made by a majority in interest of such Grantees or holders.
SECTION 22. In the event of any exercise of the option by Grantee,
Issuer and such Grantee shall execute and deliver all other documents and
instruments and take all other action that may be reasonably necessary in order
to consummate the transactions provided for by such exercise.
SECTION 23. Except to the extent Grantee exercises the Option,
Grantee shall have no rights to vote or receive dividends or have any other
rights as a shareholder with respect to shares of Issuer Common Stock covered
hereby.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, each of the parties has caused this Option
Agreement to be executed and delivered on its behalf by their respective
officers thereunto duly authorized, all as of the date first above written.
CATSKILL FINANCIAL CORPORATION
By: /s/ Xxxxxx X. Xxxxx
---------------------------------------------
Name: Xxxxxx X. Xxxxx
Title: Chairman, President and Chief Executive
Officer
XXXX FINANCIAL CORPORATION
By: /s/ Xxxxxx X. Xxxxxxx, Xx.
---------------------------------------------
Name: Xxxxxx X. Xxxxxxx, Xx.
Title: Chairman, President and Chief Executive
Officer
