Exhibit 3
As of May 25, 2006
Cascade Bancorp
0000 XX Xxxx Xxxxxx
P.O. Box 369
Bend, Oregon 97709
Re: Transfer of Shares by Xxxxx X. Xxxxxx
Reference is made to the Shareholders Agreement, dated as of December 27,
2005, by and among Cascade Bancorp (the "Company"), Xxxxx X. Xxxxxx and each
person listed on Schedule A thereto (the "Shareholders Agreement").
Xx. Xxxxxx has informed Northfield Mount Hermon School ("Northfield Mt.
Xxxxxx") that he intends to transfer by way of an outright gift and without
receipt of any payment of consideration in exchange therefor 333,333 Shares (as
such term is defined in the Shareholders Agreement) to Northfield Mt. Hermon
immediately or shortly following the effective time of the Merger (as such term
is defined in the Shareholders Agreement). Northfield Mt. Hermon understands
that (i) this transfer constitutes a "Permitted Transfer" under Section 2.03(d)
of the Shareholders Agreement, (ii) it will be receiving more than one percent
(1%) of the Total Outstanding Common Stock (as such term is defined in the
Shareholders Agreement) and (iii) upon receipt of such 333,333 Shares, it will
not own five percent (5%) or more of the Total Outstanding Common Stock.
Accordingly, Northfield Mt. Hermon hereby agrees, pursuant to Section 2.03(d) of
the Shareholders Agreement, that it will not sell more than one percent (1%) of
the Total Outstanding Common Stock in any 90-day period without the prior
written consent of the Company. Except with respect to the foregoing, Northfield
Mt. Xxxxxx understands and acknowledges that, upon receipt of its Shares, it
will not be a party to the Shareholders Agreement and the Shares held by it will
not be subject to the Shareholders Agreement; provided, that it will be entitled
to sell its Shares pursuant to an effective registration statement filed in
connection with Section 4 of the Shareholders Agreement (subject to the
restrictions set forth in the Investor Representation Letter, dated the date
hereof, among Northfield Mt. Hermon, Cascade and Xx. Xxxxxx); provided, further,
that it shall not be entitled to make any demand or request to the Company to
file or withdraw a registration statement pursuant to Section 4 of the
Shareholders Agreement.
In addition, to give effect to the foregoing restriction, Northfield Mt.
Xxxxxx agrees that the certificates evidencing the Shares shall bear a legend to
the following effect until such restrictions are no longer relevant:
THE SECURITIES REPRESENTED HEREBY MAY NOT BE SOLD, ASSIGNED, TRANSFERRED,
ENCUMBERED, OR IN ANY MANNER DISPOSED OF
EXCEPT IN CONFORMITY WITH THE TERMS OF A LETTER AGREEMENT (THE "AGREEMENT")
AMONG CASCADE BANCORP (THE "CORPORATION") AND THE REGISTERED HOLDER OF THE
SECURITIES (OR THE PREDECESSOR IN INTEREST TO THE SECURITIES). SUCH
AGREEMENT CONTAINS RESTRICTIONS ON THE ASSIGNMENT, TRANSFER, OR OTHER
DISPOSITION OF SUCH CORPORATION'S SECURITIES. THE CORPORATION WILL UPON
WRITTEN REQUEST XXXXXXX A COPY OF THE SHAREHOLDERS AGREEMENT TO THE HOLDER
HEREOF WITHOUT CHARGE.
NORTHFIELD MOUNT HERMON SCHOOL
By /s/ Xxxxxx X. Xxxxxxxxxx
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Name: Xxxxxx X. Xxxxxxxxxx
Title: Head of School
Accepted and agreed to as of the date first written above:
CASCADE BANCORP
By /s/ X. X. Xxxxxx
--------------------------------
Name: X. X. Xxxxxx
Title: CFO/EVP and Secretary
