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EXHIBIT 10.7
AMENDED AND RESTATED STOCK PURCHASE AGREEMENT
This Amended and Restated Stock Purchase Agreement (this "Agreement")
is entered into as of this 4th day of December, 1997, by and among MegaBank
Financial Corporation, a Colorado corporation (the "Corporation"), and Xxxxxx
X. Xxxxxxxx, the Xxxx X. Xxxxxxxx Trust, the Realtek Company Profit Sharing
Plan and Trust, Xxxxxx Investments Partnership, a Colorado partnership, Respond
Corp., a Colorado corporation, and Orchard Valley Financial Corporation, a
Colorado corporation (each a "Stockholder" and collectively the
"Stockholders"). The Corporation and Stockholders hereby agree as follows:
RECITALS
WHEREAS, the Corporation and certain of the Stockholders entered into
a Stock Purchase Agreement, dated December 20, 1990 (the "Original Stock
Purchase Agreement"), wherein the Corporation agreed to redeem all of the
shares of capital stock of the Corporation owned by such Stockholders upon the
terms and conditions set forth in the Original Stock Purchase Agreement; and
WHEREAS, the Corporation and the Stockholders entered into an
Amendment to Stock Purchase Agreement, dated April 16, 1992 ("Amendment No.
1"), wherein the Original Stock Purchase Agreement was amended to add
additional Stockholders and to make certain other modifications; and
WHEREAS, the parties hereto desire to further amend and restate the
Original Stock Purchase Agreement, as previously amended by Amendment No. 1, as
hereinafter described;
AGREEMENT
NOW, THEREFORE, IT IS AGREED:
ARTICLE 1.00-PURPOSE
The purpose of this Agreement is to provide:
A. For the orderly continuation of the affairs of the Corporation
at the time that certain events occur which may require the sale, transfer, or
exchange of the stock of the Corporation held by the Stockholders as provided
by the terms of this Agreement.
B. For a means by which the Stockholders may sell shares of stock
when certain events set out in this Agreement take place.
ARTICLE 2.00-PURCHASE AND SALE
At the time of the execution of this Agreement, the Stockholders own
the following shares of the common stock (the "Stock") in the Corporation:
Xxxxxx X. Xxxxxxxx 53,160 shares
Xxxx X. Xxxxxxxx Trust 2,563 shares
Realtek Company Profit Sharing Plan and Trust 20,494 shares
Xxxxxx Investments Partnership 1,663 shares
Orchard Valley Financial Corporation 21,815 shares
Respond Corp. 9,360 shares
Pursuant to the terms of this Agreement, the Stockholders agree to sell certain
of their shares of Stock in accordance with the terms of this Agreement and the
Corporation agrees to purchase the same in accordance with its terms and
conditions. In the event of any stock dividends or stock splits, the shares
received thereby by the Stockholders shall be similarly subject to the terms of
this Agreement.
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ARTICLE 3.00-ENCUMBRANCE
The parties acknowledge and agree that they do not wish to prevent any
Stockholder from pledging, hypothecating or otherwise encumbering his shares of
Stock.
ARTICLE 4.00-PURCHASE AT DEATH
4.01 Purchase by the Corporation. Upon the death of Xxxxxx X.
Xxxxxxxx (herein "Xxxxxxxx"), each Stockholder shall have an option for ninety
(90) days from the date of Xxxxxxxx'x death to cause a Purchase (as hereinafter
defined) by the Corporation. Such option may be exercised by any Stockholder
by delivering a written notice (an "Exercise Notice") to the Corporation,
signed by the Stockholder, requesting that a number of such Stockholder's
shares be purchased pursuant to this Agreement. The number of shares to be
purchased shall be designated by the Stockholder in the Exercise Notice and
shall not exceed the number of shares owned by such Stockholder's at the time
of Xxxxxxxx'x death. The Exercise Notice must be received by the Corporation
within ninety (90) days from the date of Xxxxxxxx'x death. Once given and
timely received, the Exercise Notice shall be irrevocable with respect to the
Stockholders executing such Exercise Notice (the "Selling Stockholders"), and
the Corporation and the Selling Stockholders, respectively, agree to consummate
a Purchase, on the terms set forth in Section 4.02.
4.02 Purchase. A "Purchase" shall mean the purchase for cash by
the Corporation of a number of whole shares of Stock from a Selling
Stockholder, said number to be determined by subtracting from such Selling
Stockholder's Allocable Insurance Proceeds (as hereinafter defined) any
indebtedness due and payable to the Corporation by such Selling Stockholder and
dividing the remainder by the price for shares of Stock (to be determined in
accordance with Article 5.00), rounded down to the next whole share of Stock.
The "Allocable Insurance Proceeds" for each Selling Stockholder shall mean the
net proceeds payable to the Corporation following Xxxxxxxx'x death from the
insurance policy listed on Exhibit B (the "Net Insurance Proceeds"), multiplied
by a fraction, the numerator of which is the number of shares of Stock
designated in the Exercise Notice by such Selling Stockholder, and the
denominator of which is the number of shares of Stock designated in all
Exercise Notices by all Selling Stockholders.
4.03 Net Insurance Proceeds. To the extent that an Exercise Notice
is not timely delivered following Xxxxxxxx'x death or the Net Insurance
Proceeds exceed the amounts necessary for the Corporation to purchase Stock of
the Selling Stockholders pursuant to this Article 4.00, the Corporation shall
be entitled to retain the entire amount of the Net Insurance Proceeds or such
excess, respectively, without liability to any Stockholder or any other party
therefor.
4.04 Closing. The closing of a Purchase shall take place at the
office of the Corporation at a date designated by the Corporation, which date
shall be not more than thirty (30) days after the date of receipt by the
Corporation of the Exercise Notice or payment to the Corporation of the Net
Insurance Proceeds, whichever is later.
4.05 Certain Definitions. For purposes of this Article 4.00, the
term "Stockholder" shall include, in addition to the Stockholders specifically
named herein, Xxxxxxxx'x estate, the trustee of any trust created by Xxxxxxxx
which was treated during his lifetime as owned by Xxxxxxxx under the provisions
of Subpart E of Part I of Subchapter J of the Internal Revenue Code of 1986 as
amended, and any entity hereafter formed by Xxxxxxxx in which he beneficially
owns greater than 50% of the voting rights.
ARTICLE 5.00-STOCK VALUE AND RE-EVALUATION
The purchase price for the shares of Stock shall be Forty Five Dollars
($45.00) per share until altered by re-evaluation as hereinafter provided.
The Stockholders and the Corporation agree that the value of the Stock includes
an amount representing the good will of the Corporation as a going concern.
Within three (3) months after the end of each fiscal year of the Corporation
and/or 45 days after review of audited financial
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statements of the Corporation for the preceding fiscal year, the Stockholders
and the Corporation may, by mutual agreement, redetermine such value as of the
end of the preceding fiscal year, and such redetermination shall be entered
into the valuation schedule attached hereto as Exhibit A. If the Stockholders
and the Corporation fail to redetermine the value for any fiscal year(s), the
last previously stipulated value shall be used, with an appropriate adjustment,
upward or downward, to reflect changes in the book value per share of the
Corporation since the effective date of the last valuation.
ARTICLE 6.00-CORPORATE RESTRICTIONS AFTER PURCHASE
[intentionally omitted]
ARTICLE 7.00-LIFE INSURANCE
7.01 Owner and Beneficiary. The Corporation has purchased a life
insurance policy on the life of Xxxxxx X. Xxxxxxxx. (See Exhibit B). The
Corporation hereby reserves the right to exercise all incidents of ownership
with respect to such policy.
7.02 Insurance Companies. The insurance company that has issued
the policy of life insurance listed on Exhibit B of this Agreement is
authorized to act in accordance with the terms of such policy regardless of the
provisions of this Agreement. Payments made by any such insurance company,
pursuant to the policy terms, shall be a complete discharge of its obligations.
ARTICLE 8.00-RELEASE FROM INDEBTEDNESS
With respect to a Selling Stockholder which sells all shares of Stock
owned by such Stockholder pursuant to this Agreement: (i) the Corporation
agrees to use its best efforts to release any property of a Selling Stockholder
that is used as security for any indebtedness of the Corporation, said release
to occur, to the extent practicable, within twelve (12) months of the date of
the death of Xxxxxx X. Xxxxxxxx; (ii) the Corporation shall also use its best
efforts to release the Selling Stockholders from any liability on any notes or
other obligations incurred for the benefit of the Corporation for which they
are individually or jointly liable, said releases to occur, to the extent
practicable, within twelve (12) months after the date of death of Xxxxxx X.
Xxxxxxxx; provided, however, that in the event that the Corporation is
unable to secure said releases, it shall indemnify and hold harmless the
Selling Stockholders, their estates and successors, from any and all
liabilities which are incurred in the event of a default by the Corporation.
ARTICLE 9.00-SECURITY
[intentionally omitted]
ARTICLE 10.00-TERMINATION OF AGREEMENT
This Agreement shall terminate upon the occurrence of any of the
following events:
10.01 The cessation of the Corporation's business;
10.02 The bankruptcy, receivership or dissolution of the Corporation;
10.03 On the date that the insurance described on Exhibit B lapses or
is canceled; or
10.04 Upon written notice by Xxxxxxxx to the Corporation.
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ARTICLE 11.00-BINDING UPON LEGAL REPRESENTATIVES
This Agreement shall be binding upon and shall inure to the benefit of
the respective heirs, legal representatives, assigns, transferees and
successors of each of the parties hereto.
ARTICLE 12.00-CONSTRUCTION
The titles appearing herein are used for purpose of convenience only
and shall in no way change the meaning of this Agreement. If any conflict
between any heading and the text of this Agreement exists, the text shall
control.
ARTICLE 13.00-NOTICES
Any and all notices, designations, consents, offers, acceptances or
any other communications provided for herein shall be given in writing either
by:
(a) Registered or certified mail which shall be
addressed, in the case of the Corporation, to its principal office,
and in the case of any Stockholder, to his address appearing on the
stock books of the Corporation or his residence or at such other
address as may be designated for him; or
(b) Personal delivery to the party requiring notice and
securing a written receipt.
The effective date of the notice shall be the date of the written receipt
received upon personal delivery or five (5) days after mailing in the case of
certified mail.
ARTICLE 14.00-INVALID PROVISION
The invalidity and unenforceability of any particular provision of
this Agreement shall not affect the other provisions hereof and this Agreement
shall be construed in all respects as if such invalid and unenforceable
provisions were omitted.
ARTICLE 15.00-MODIFICATION
No change or modification of this Agreement shall be valid unless the
same is in writing and signed by all the parties hereto.
ARTICLE 16.00-ATTORNEYS' FEES
In the event suit is brought to enforce any or all of the provisions
of this Agreement, the prevailing party shall be entitled to reimbursement of
his court costs and attorneys' fees.
ARTICLE 17.00-GENDER AND NUMBER
As used herein, the masculine gender shall include the feminine and
neuter genders, and the singular shall include the plural, and vice versa,
where the context requires.
ARTICLE 18.00-ADDITIONAL DOCUMENTS AND FURTHER ASSURANCES
The parties hereto agree to execute any other documents that are
necessary to effectuate the provisions of this Agreement.
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ARTICLE 19.00-GOVERNING LAW
This Agreement and all of its provisions shall be governed and
construed in accordance with the laws of the State of Colorado.
IN WITNESS WHEREOF, the parties hereto have executed this Amended and
Restated Stock Purchase Agreement as of the date first above written.
The Corporation:
MEGABANK FINANCIAL CORPORATION
By:/s/ Xxxxx X. Xxxxx
------------------------------------
Xxxxx X. Xxxxx, President
The Stockholders:
/s/ Xxxxxx X. Xxxxxxxx
---------------------------------------
Xxxxxx X. Xxxxxxxx
THE XXXX X. XXXXXXXX TRUST
By:/s/ Xxxxxx X. Xxxxxxxx
------------------------------------
Xxxxxx X. Xxxxxxxx, Trustee
THE REALTEK COMPANY PROFIT
SHARING PLAN AND TRUST
By:/s/ Xxxxxx X. Xxxxxxxx
------------------------------------
Xxxxxx X. Xxxxxxxx, Administrator
XXXXXX INVESTMENTS PARTNERSHIP
By:/s/ Xxxxxx X. Xxxxxxxx
------------------------------------
Xxxxxx X. Xxxxxxxx, General Partner
ORCHARD VALLEY FINANCIAL CORP.
By:/s/ Xxxxxx X. Xxxxxxxx
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Xxxxxx X. Xxxxxxxx, President
RESPOND CORP.
By:/s/ Xxxxxx X. Xxxxxxxx
------------------------------------
Xxxxxx X. Xxxxxxxx, President
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Each of the undersigned hereby acknowledges that this Agreement was
prepared by legal counsel representing the Corporation. Further, each of the
undersigned recognize that said legal counsel was acting solely on behalf of
the Corporation and not on behalf of any Stockholder, individually or
collectively. Each of the undersigned represent and warrant that he/she/it has
been advised to seek independent legal and financial counsel with respect to
the execution of this Agreement and that he/she/it has had the opportunity to
do so. Each of the undersigned agrees that the statements, representations and
warranties made in this paragraph may be relied upon by the Corporation and it
legal counsel and their respective successors in interest.
The Corporation:
MEGABANK FINANCIAL CORPORATION
By:/s/ Xxxxx X. Xxxxx
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Xxxxx X. Xxxxx, President
The Stockholders:
/s/ Xxxxxx X. Xxxxxxxx
---------------------------------------
Xxxxxx X. Xxxxxxxx
THE XXXX X. XXXXXXXX TRUST
By:/s/ Xxxxxx X. Xxxxxxxx
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Xxxxxx X. Xxxxxxxx, Trustee
THE REALTEK COMPANY PROFIT
SHARING PLAN AND TRUST
By:/s/ Xxxxxx X. Xxxxxxxx
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Xxxxxx X. Xxxxxxxx, Administrator
XXXXXX INVESTMENTS PARTNERSHIP
By:/s/ Xxxxxx X. Xxxxxxxx
------------------------------------
Xxxxxx X. Xxxxxxxx, General Partner
ORCHARD VALLEY FINANCIAL CORP.
By:/s/ Xxxxxx X. Xxxxxxxx
------------------------------------
Xxxxxx X. Xxxxxxxx, President
RESPOND CORP.
By:/s/ Xxxxxx X. Xxxxxxxx
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Xxxxxx X. Xxxxxxxx, President
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EXHIBIT A
VALUE OF SHARES
DATE VALUE INITIALS OF PARTIES
---- ----- -------------------
Fiscal Year
1998
Fiscal Year
1999
Fiscal Year
2000
Fiscal Year
2001
Fiscal Year
2002
Fiscal Year
2003
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EXHIBIT B
POLICIES OF INSURANCE OWNED
ON THE LIVES OF THE XXXXXX X. XXXXXXXX
Name of
Insurance Policy Face
Company Number Owner Insured Amount
------- ------ ----- ------- ------
Transamerica Life 40779161 MegaBank Xxxxxx X. $3,000,000
Financial Xxxxxxxx
Corporation
