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EXECUTION COPY
STOCK PURCHASE AGREEMENT (this "Agreement"), dated as of
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February 19, 2001 between Provident Bankshares Corporation, a Maryland
corporation (the "Purchaser"), on the one hand and Mid-Atlantic Investors,
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a South Carolina general partnership ("M-A Investors"), Mid-Atlantic
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Partners, L.P., a South Carolina limited partnership ("M-A Partners"),
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Xxxxxxx Enterprises, Inc., a South Carolina corporation ("SEI"), Xxxxx
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Xxxxxx, a natural person and resident of South Carolina ("JZ"), and H.
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Xxxxx Xxxxxxx, a natural person and resident of South Carolina ("JS" and,
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together with M-A Investors, M-A Partners, SEI and JZ, the "Sellers" and
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each a "Seller") on the other hand.
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WHEREAS, each Seller owns that number of the issued and
outstanding shares of common stock, par value $1.00 per share ("Common
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Shares"), of Purchaser, set forth opposite his or its name on Schedule A
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hereto (such Seller's "Contract Shares");
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WHEREAS, the Purchaser desires to purchase from each Seller,
and each Seller desires to sell to the Purchaser, all of such Seller's
Contract Shares on the terms and subject to the conditions set forth
herein;
NOW THEREFORE, the Purchaser and each Seller agree as follows:
SECTION 1. Purchase and Sale of the Contract Shares.
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(1) Subject to the terms and conditions of this Agreement,
including the accuracy of the representations and warranties set forth
herein, the Purchaser agrees to purchase from each Seller, and each Seller
agrees to sell to the Purchaser, 75% of such Seller's Contract Shares at
the Closing (as defined below). A Seller's Contract Shares transferred or
to be transferred at the Closing are hereinafter referred to as such
Seller's "Closing Contract Shares".
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(2) Subject to the terms and conditions of this Agreement,
including the accuracy of the representations and warranties set forth
herein, the Purchaser agrees to purchase from each Seller, and each Seller
agrees to sell to the Purchaser, the remaining 25% of such Seller's
Contract Shares at the Second Closing (as defined below). A Seller's
Contract Shares transferred or to be transferred at the Second Closing are
hereinafter referred to as such Seller's "Second Closing Contract Shares".
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(3) The purchase price for the Contract Shares is $23.8568387
per Contract Share (the "Share Price"). In addition, at the Second
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Closing, the Purchaser shall pay each Seller a carrying charge (the
"Carrying Charge") in an amount equal to the product of (i) the amount
such Seller is receiving at the Second Closing for such Seller's Second
Closing Contract Shares, (ii) 0.07625 and (iii) a quotient, the numerator
of which is equal to the number of days elapsed from February 23, 2001 to
the Second Closing (which, if the Second Closing occurs on March 15, 2001,
shall be 20) and the denominator of which is equal to 365.
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EXECUTION COPY
(4) At the Closing and the Second Closing, each Seller shall
deliver to the Purchaser, in a form and in a manner reasonably acceptable
to the Purchaser, all of such Seller's Closing Contract Shares and Second
Closing Contract Shares, respectively, being sold at such time, free and
clear of all liens, pledges, charges, equities, claims or other
encumbrances, together with any further documents or instruments,
including, if appropriate, stock powers duly endorsed in blank or stock
transfer stamps affixed thereto, or certificates from broker-dealers
previously holding liens on such shares or holding such shares for a
Seller, reasonably requested by the Purchaser.
(5) At the Closing and the Second Closing, the Purchaser shall
pay by wire transfer to each Seller an amount equal to the Share Price
MULTIPLIED by the number of such Seller's Closing Contract Shares and
Second Closing Contract Shares, respectively, being sold at such time,
and, at the Second Closing, the Carrying Charge.
SECTION 2. The Closing and the Second Closing.
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(1) The Closing shall occur at 10:00 a.m. on February 23,
2001.
(2) Upon payment by the Purchaser to each Seller of the Share
Price for such Seller's Closing Contract Shares and delivery by each
Seller of its Closing Contract Shares to the Purchaser the Closing shall
have occurred and the purchase and sale of the Sellers' Closing Contract
Shares shall be deemed to be complete.
(3) The Second Closing shall occur at 10:00 a.m. on March 15,
2001.
(4) Upon payment by the Purchaser to each Seller of the Share
Price for such Seller's Second Closing Contract Shares and the Carrying
Charge and delivery by each Seller of its Second Closing Contract Shares
to the Purchaser the Second Closing shall have occurred and the purchase
and sale of the Sellers' Second Closing Contract Shares shall be deemed to
be complete.
SECTION 3. Standstill. Each Seller hereby covenants to and
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agrees with the Purchaser that for a period of three years from the date
of this Agreement, such Seller will not, and shall cause his or its
affiliates, officers, directors, employees, counsel, investment bankers,
consultants and other representatives (such persons being generally
referred to herein as "Representatives") not to (and such Seller and his
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or its affiliates and their respective Representatives will not assist or
form a "group" within the meaning of Section 13(d)(3) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), act
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in concert or participate with or encourage other persons to), directly or
indirectly, (i) acquire or offer to acquire, seek, propose or agree to
acquire, by means of a purchase, tender or exchange offer, business
combination or in any other manner, beneficial ownership of any Common
Shares or other securities of the Purchaser, including rights or options
to acquire such ownership, (ii) seek or propose to influence, advise,
change or control the management, Board of Directors, governing
instruments or policies or affairs of the Purchaser in any way, including,
without limitation, by means of a solicitation of proxies (as such terms
are defined in Rule 14a-1 of Regulation 14A promulgated pursuant to
Section 14 of the Exchange Act, disregarding clause (iv) of Rule
14a-1(l)(2) and including any otherwise exempt solicitation pursuant to
Rule 14a-2(b)(1)), or by means of the submission or promotion or other
support of any "proposal", including any proposals as defined in Rule
14a-8 of such Regulation 14A (and hereby irrevocably withdraws any and all
pending proposals submitted by or on behalf of such Seller prior to the
execution and delivery of this Agreement) and (iii) seek or propose to
influence, advise or direct the vote of any holder of Common Shares or
other securities of the Purchaser.
The term "person" as used in this Agreement shall be broadly
interpreted to include, without limitation, the media and any corporation,
company, group, partnership or individual. The term "affiliate" as used in
this Agreement shall have the meaning ascribed to such term in Rule 12b-2
of the General Rules and Regulations under the Exchange Act.
SECTION 4. Confidentiality. Each Seller hereby covenants to
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and agrees with the Purchaser that neither such Seller nor any of his or
its affiliates or their respective Representatives shall, directly or
indirectly, make any statement or otherwise make any disclosure, directly
or indirectly, regarding the Purchaser or its subsidiaries or the
negotiations or discussions relating to this Agreement or this Agreement;
PROVIDED, that a Seller may make (i) a disclosure to the extent that such
disclosure is required by law, so long as, to the extent practicable, (x)
such Seller provides prompt advance written notice to the Purchaser and
(y) such Seller cooperates with the Purchaser, each in good faith, in
agreeing upon the language of such disclosure; and (ii) a statement the
purpose of which is to correct any statement of Purchaser specifically
regarding any Seller that is disparaging to the integrity, character or
business of such Seller.
SECTION 5. Representations and Warranties of each Seller. The
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Sellers hereby represent and warrant, jointly and severally, to the
Purchaser as of the date of this Agreement, the Closing and the Second
Closing as follows:
(1) Seller, in the case of M-A Investors, M-A Partners and
SEI, is duly organized and is validly existing under the laws of South
Carolina.
(2) Seller has the requisite capacity, power and authority to
enter into this Agreement and to consummate the transactions contemplated
hereby.
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(3) The execution and delivery of this Agreement by Seller and
the sale and delivery of the Contract Shares hereunder have been duly
authorized by all necessary actions on the part of such Seller and any
necessary third party (including any consultation, approval or other
action by or with any other person or governmental entity), and will not
conflict with or result in a breach or violation of any of the terms or
provisions of its certificate of incorporation or by-laws (if it is a
corporation) or equivalent constituent documents or result in the breach
or violation of any of the terms or provisions of, or constitute a default
under, any indenture, mortgage, deed of trust, loan agreement or any other
agreement or instrument to which it is a party or by which it is bound or
to which any of its properties or assets is subject, nor will any such
action result in any violation of the provisions of any statute or any
order, rule or regulation of any court or governmental agency or body
having jurisdiction over it or its property.
(4) This Agreement has been duly executed and delivered by
Seller and constitutes a valid and binding obligation of Seller,
enforceable against the Seller in accordance with its terms, subject to
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium
and similar laws of general applicability relating to or affecting
creditors' rights and to general equity principles (regardless of whether
enforcement is sought in a proceeding in equity or at law).
(5) Such Seller has record and beneficial ownership of and
good and valid title to such Seller's Contract Shares, and except in
connection with a margin loan that will be repaid with the proceeds from
the sale of the Closing Contract Shares at the Closing and the sale of the
Second Closing Contract Shares at the Second Closing, such ownership and
title are free and clear of all liens, pledges, charges, equities, claims
or other encumbrances.
(6) Upon delivery of the Closing Contract Shares and Second
Closing Contract Shares hereunder and payment therefor pursuant hereto,
good and valid title to such Closing Contract Shares and Second Closing
Contract Shares, as the case may be, free and clear of all liens, pledges,
charges, equities, claims and encumbrances, will pass to the Purchaser.
(7) Such Seller beneficially owns only those Common Shares
identified as Contract Shares with respect to such Seller on Schedule A
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hereto, and such Seller holds no other securities of Purchaser other than
such Contract Shares.
(8) Seller is not participating with any other person, other
than the other Sellers, in any "group", as such term is used in Rule 13D
under the Exchange Act, with respect to any security of Purchaser.
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(9) There is not pending or, to Seller's knowledge, threatened
against Seller any action, suit or proceeding at law or in equity before
any court, tribunal, governmental body, agency or official or any
arbitrator that might affect the legality, validity or enforceability
against such Seller of this Agreement or such Seller's ability to perform
such Seller's obligations hereunder.
(10) No person or entity acting on behalf or under the
authority of Seller is or will be entitled to any broker's, finder's, or
similar fee or commission in connection with the transactions contemplated
by this Agreement, except for such fees or commissions as shall be paid by
the Sellers.
SECTION 6. Representations and Warranties of the Purchaser.
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The Purchaser represents and warrants to each of the Sellers as of the
date of this Agreement, the Closing and the Second Closing as follows:
(1) Purchaser is duly organized and is validly existing under
the laws of Maryland.
(2) Purchaser has the requisite power and authority to enter
into this Agreement and to consummate the transactions contemplated
hereby.
(3) The execution and delivery of this Agreement by Purchaser
has been duly authorized by all necessary actions on the part of such
Purchaser and any necessary third party (including any consultation,
approval or other action by or with any other person or governmental
entity), and will not conflict with or result in a breach or violation of
any of the terms or provisions of its certificate of incorporation or
by-laws or result in the breach or violation of any of the terms or
provisions of, or constitute a default under, any indenture, mortgage,
deed of trust, loan agreement or any other agreement or instrument to
which it is a party or by which it is bound or to which any of its
properties or assets is subject, nor will any such action result in any
violation of the provisions of any statute or any order, rule or
regulation of any court or governmental agency or body having jurisdiction
over it or its property.
(4) This Agreement has been duly executed and delivered by
Purchaser and constitutes a valid and binding obligation of Purchaser,
enforceable against the Purchaser in accordance with its terms, subject to
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium
and similar laws of general applicability relating to or affecting
creditors' rights and to general equity principles (regardless of whether
enforcement is sought in a proceeding in equity or at law).
(5) There is not pending or, to Purchaser's knowledge,
threatened against Purchaser any action, suit or proceeding at law or in
equity before any court, tribunal,
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governmental body, agency or official or any arbitrator that might affect
the legality, validity or enforceability against it of this Agreement or
its ability to perform its obligations hereunder.
(6) No person or entity acting on behalf or under the
authority of Purchaser is or will be entitled to any broker's, finder's,
or similar fee or commission in connection with the transactions
contemplated by this Agreement.
SECTION 7. Miscellaneous.
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(1) ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement and understanding among the Purchaser and each of the Sellers
with respect to the subject matter hereof and supersedes all other prior
agreements, understandings and arrangements, whether oral or written,
among the parties hereto.
(2) EXPENSES. Each party hereto shall be responsible for and
shall pay its own costs and expenses, including attorneys' fees and
accountants' fees and expenses, incurred in connection with the
negotiation, execution and delivery of this Agreement. Each Seller shall
pay any transfer taxes imposed on transferors payable in connection with
the sale of his or its Contract Shares to be sold by him or it hereunder.
(3) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE
TO CONTRACTS MADE AND TO BE PERFORMED IN SUCH STATE WITHOUT REGARD TO THE
CONFLICT OF LAW PRINCIPLES THEREOF.
(4) SUCCESSORS AND ASSIGNS. This Agreement shall benefit and
bind the successors and permitted assigns of the parties hereto. Any
assignment of this Agreement by any party without the prior written
consent of each of the other parties shall be void AB INITIO.
(5) AMENDMENTS. This Agreement may only be amended or modified
by a written instrument signed by the Purchaser and each of the Sellers.
(6) WAIVERS. No waiver of any provision of this Agreement by
any party shall be deemed to be a continuing waiver of any provision of
this Agreement by such party.
(7) EQUITABLE RELIEF. The parties hereby expressly recognize
and acknowledge that immediate, extensive and irreparable damage would
result in the event the Sellers' covenants and agreements in this
Agreement are not specifically enforced. Therefore, in addition to, and
not in limitation of, any other remedy
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available to the Purchaser, the respective rights of the Purchaser and
obligations of the Sellers shall be enforceable in a court of equity by
decree of specific performance and appropriate injunctive relief may be
applied for and granted in connection therewith.
(8) COUNTERPARTS; DELIVERY. This Agreement may be executed in
any number of separate counterparts, each such counterpart being deemed to
be an original instrument, and all such counterparts shall together
constitute the same agreement. Delivery may be effected via facsimile.
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IN WITNESS WHEREOF, the Purchaser and each Seller have
executed this Agreement below.
PROVIDENT BANKSHARES CORPORATION
By: /s/ Xxxx X. Xxxxxx
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Name: Xxxx X. Xxxxxx
Title: President and Chief Operating Officer
MID-ATLANTIC INVESTORS
By: _________________________________
Name:
Title:
MID-ATLANTIC PARTNERS, L.P.
By: _________________________________
Name:
Title:
SHREARER ENTERPRISES, INC.
By: _________________________________
Name:
Title:
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Xxxxx Xxxxxx
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H. Xxxxx Xxxxxxx
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IN WITNESS WHEREOF, the Purchaser and each Seller have
executed this Agreement below.
PROVIDENT BANKSHARES CORPORATION
By: ________________________________
Name: Xxxx X. Xxxxxx
Title: President and Chief Operating Officer
MID-ATLANTIC INVESTORS
By: /s/ H. Xxxxx Xxxxxxx
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Name: H. Xxxxx Xxxxxxx
Title: Managing Partner
MID-ATLANTIC PARTNERS, L.P.
By: _________________________________
Name:
Title:
SHREARER ENTERPRISES, INC.
By: /s/ H. Xxxxx Xxxxxxx
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Name: H. Xxxxx Xxxxxxx
Title: President & Partner
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Xxxxx Xxxxxx
/s/ H. Xxxxx Xxxxxxx
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H. Xxxxx Xxxxxxx
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IN WITNESS WHEREOF, the Purchaser and each Seller have
executed this Agreement below.
PROVIDENT BANKSHARES CORPORATION
By: _________________________________
Name: Xxxx X. Xxxxxx
Title: President and Chief Operating Officer
MID-ATLANTIC INVESTORS
By: /s/ Xxxxx Xxxxxx
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Name: Xxxxx Xxxxxx
Title: General Partner
MID-ATLANTIC PARTNERS, L.P.
By: /s/ Xxxxx Xxxxxx
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Name: Xxxxx Xxxxxx
Title: General Partner
SHREARER ENTERPRISES, INC.
By: _________________________________
Name:
Title:
/s/ Xxxxx Xxxxxx
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Xxxxx Xxxxxx
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H. Xxxxx Xxxxxxx
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SCHEDULE A
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Seller Contract Shares
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Mid-Atlantic Investors 414,251
Mid-Atlantic Partners, L.P. 438,506
Xxxxxxx Enterprises, Inc. 0
Xxxxx Xxxxxx 554,400
H. Xxxxx Xxxxxxx 0
A-1
