Exhibit 10.1
UNITED STATES DEPARTMENT OF THE
TREASURY
1500 Pennsylvania Avenue,
NW
Washington, D.C.
Dear Ladies and
Gentlemen:
The company set forth on the signature page
hereto (the “ Company ”) intends to issue in
private placement the number of shares of a series of its preferred
stock set forth on Schedule A hereto (the “Preferred
Shares ”) and a warrant to purchase the number of shares
of its common stock set forth in Schedule A hereto (the “
Warrant ” and, together with the Preferred Shares, the
“ Purchased Securities ”) and the United States
Department of the Treasury (the “ Investor ”)
intends to purchase from the Company the Purchased
Securities.
The purpose of this letter agreement is to
confirm the terms and conditions of the purchase by the Investor of
the Purchased Securities. Except to the extent
supplemented or superceded by terms set forth herein or in the
Schedules hereto, the provisions contained in the Securities
Purchase Agreement – Standard Terms attached hereto as
Exhibit A (the “ Securities Purchase Agreement
”) are incorporated by reference herein. Terms
that are defined in the Securities Purchase Agreement are used in
this letter agreement as so defined. In the event of any
inconsistency between this letter agreement and the Securities
Purchase Agreement, the terms of this letter agreement shall
govern.
Each of the Company and the Investor hereby
confirms its agreement with the other party with respect to the
issuance by the Company of the Purchased Securities and the
purchase by the Investor of the Purchased Securities pursuant to
this letter agreement and the Securities Purchase Agreement on the
terms specified on Schedule A hereto.
This letter agreement (including the Schedules
hereto) and the Securities Purchase Agreement (including the
Annexes thereto) and the Warrant constitute the entire agreement,
and supercede all other prior agreements, understandings,
representations and warranties, both written and oral, between the
parties, with respect to the subject matter hereof. This
letter agreement constitutes the “Letter Agreement”
referred to in the Securities Purchase Agreement.
This letter agreement may be executed in any
number of separate counterparts, each such counterpart being deemed
to be an original instrument, and all such counterparts will
together constitute the same agreement. TRAP Letter Agreement
Executed signature pages to this letter agreement may be delivered
by facsimile and such facsimile will be deemed as sufficient as if
actual signature pages had been delivered.
In witness whereof, this letter agreement has
been duly executed and delivered by the authorized representative
of the parties hereto as of the date written below.
|
|
UNITED STATES
DEPARTMENT OF THE TREASURY
|
|
|
|
|
|
|
|
|
|
|
By:
|
/s/ Neel
Kashkari
|
|
|
|
Name: Neel
Kashkari
|
|
|
|
Title: Interim Assistant Secretary For Financial
Stability
|
|
|
|
|
|
|
|
|
|
|
CARVER BANCORP,
INC.
|
|
|
|
|
|
|
|
|
|
|
By:
|
/s/ Deborah
C. Wright
|
|
|
|
Name: Deborah
C. Wright
|
|
|
|
Title: Chairman, President and Chief Executive
Officer
|
Date: January 16, 2009
EXHIBIT A
SECURITIES PURCHASE
AGREEMENT
STANDARD TERMS
TABLE OF CONTENTS
|
|
|
Page
|
|
|
|
|
|
|
Article I
|
|
|
|
|
|
|
|
Purchase; Closing
|
|
|
|
|
|
|
1.1
|
Purchase
|
7
|
|
1.2
|
Closing
|
7
|
|
1.3
|
Interpretation
|
9
|
|
|
|
|
|
|
Article II
|
|
|
|
|
|
|
|
Representations and
Warranties
|
|
|
|
|
|
|
2.1
|
Disclosure
|
10
|
|
2.2
|
Representations
and Warranties of the Company
|
10
|
|
|
|
|
|
|
Article III
|
|
|
|
|
|
|
|
Covenants
|
|
|
|
|
|
|
3.1
|
Commercially
Reasonable Efforts
|
20
|
|
3.2
|
Expenses
|
21
|
|
3.3
|
Sufficiency of
Authorized Common Stock; Exchange Listing
|
21
|
|
3.4
|
Certain
Notifications Until Closing
|
22
|
|
3.5
|
Access,
Information and Confidentiality
|
22
|
|
|
|
|
|
|
Article IV
|
|
|
|
|
|
|
|
Additional Agreements
|
|
|
|
|
|
|
4.1
|
Purchase for
Investment
|
23
|
|
4.2
|
Legends
|
23
|
|
4.3
|
Certain
Transactions
|
25
|
|
4.4
|
Transfer of
Purchased Securities and Warrant Shares; Restrictions on Exercise
of the Warrant
|
25
|
|
4.5
|
Registration
Rights.
|
26
|
|
4.6
|
Voting of
Warrant Shares
|
39
|
|
4.7
|
Depositary
Shares
|
39
|
|
4.8
|
Restriction on
Dividends and Repurchases
|
39
|
|
4.9
|
Repurchase of
Investor Securities
|
41
|
|
4.10
|
Executive
Compensation
|
42
|
|
4.11
|
Bank and Thrift
Holding Company Status
|
42
|
|
4.12
|
Predominantly
Financial
|
42
|
|
|
Article V
|
|
|
|
|
|
|
|
Miscellaneous
|
|
|
|
|
|
|
5.1
|
Termination
|
43
|
|
5.2
|
Survival of
Representations and Warranties
|
43
|
|
5.3
|
Amendment
|
44
|
|
5.4
|
Waiver of
Conditions
|
44
|
|
5.5
|
Governing
Law: Submission to Jurisdiction, Etc.
|
44
|
|
5.6
|
Notices
|
44
|
|
5.7
|
Definitions
|
45
|
|
5.8
|
Assignment
|
45
|
|
5.9
|
Severability
|
45
|
|
5.10
|
No Third Party
Beneficiaries
|
46
|
LIST OF ANNEXES
|
|
FORM OF
CERTIFICATE OF DESIGNATIONS FOR PREFERRED STOCK
|
INDEX OF DEFINED TERMS
|
|
|
|
|
Affiliate
|
|
5.7(b)
|
|
Agreement
|
|
Recitals
|
|
Appraisal
Procedure
|
|
4.9(c)(i)
|
|
Appropriate
Federal Banking Agency
|
|
2.2(s)
|
|
Bank Holding
Company
|
|
4.11
|
|
Bankruptcy
Exceptions
|
|
2.2(d)
|
|
Benefit
Plans
|
|
1.2(d)(iv)
|
|
Board of
Directors
|
|
2.2(f)
|
|
Business
Combination
|
|
4.4
|
|
business
day
|
|
1.3
|
|
Capitalization
Date
|
|
2.2(b)
|
|
Certificate of
Designations
|
|
1.2(d)(iii)
|
|
Charter
|
|
1.2(d)(iii)
|
|
Closing
|
|
1.2(a)
|
|
Closing
Date
|
|
1.2(a)
|
|
Code
|
|
2.2(n)
|
|
Common
Stock
|
|
Recitals
|
|
Company
|
|
Recitals
|
|
Company
Financial Statements
|
|
2.2(h)
|
|
Company
Material Adverse Effect
|
|
2.1(a)
|
|
Company
Reports
|
|
2.2(i)(i)
|
|
Company
Subsidiary; Company Subsidiaries
|
|
2.2(i)(i)
|
|
control;
controlled by; under common control with
|
|
5.7(b)
|
|
Controlled
Group
|
|
2.2(n)
|
|
CPP
|
|
Recitals
|
|
EESA
|
|
1.2(d)(iv)
|
|
ERISA
|
|
2.2(n)
|
|
Exchange
Act
|
|
2.1(b)
|
|
Fair Market
Value
|
|
4.9(c)(ii)
|
|
Federal
Reserve
|
|
4.11
|
|
GAAP
|
|
2.1(a)
|
|
Governmental
Entities
|
|
1.2(c)
|
|
Holder
|
|
4.5(k)(i)
|
|
Holders’
Counsel
|
|
4.5(k)(ii)
|
|
Indemnitee
|
|
4.5(g)(i)
|
|
Information
|
|
3.5(b)
|
|
Initial Warrant
Shares
|
|
Recitals
|
|
Investor
|
|
Recitals
|
|
Junior
Stock
|
|
4.8(c)
|
|
knowledge of
the Company; Company’s knowledge
|
|
5.7(c)
|
|
Last Fiscal
Year
|
|
2.1(b)
|
|
Letter
Agreement
|
|
Recitals
|
|
officers
|
|
5.7(c)
|
|
Parity
Stock
|
|
4.8(c)
|
|
Pending
Underwritten Offering
|
|
4.5(l)
|
|
Permitted
Repurchases
|
|
4.8(a)(ii)
|
|
Piggyback
Registration
|
|
4.5(a)(iv)
|
|
Plan
|
|
2.2(n)
|
|
Term
|
|
Location of
Definition
|
|
Preferred
Shares
|
|
Recitals
|
|
Preferred
Stock
|
|
Recitals
|
|
Previously
Disclosed
|
|
2.1(b)
|
|
Proprietary
Rights
|
|
2.2(u)
|
|
Purchase
|
|
Recitals
|
|
Purchase
Price
|
|
1.1
|
|
Purchased
Securities
|
|
Recitals
|
|
Qualified
Equity Offering
|
|
4.4
|
|
register;
registered; registration
|
|
4.5(k)(iii)
|
|
Registrable
Securities
|
|
4.5(k)(iv)
|
|
Registration
Expenses
|
|
4.5(k)(v)
|
|
Regulatory
Agreement
|
|
2.2(s)
|
|
Rule 144; Rule
144A; Rule 159A; Rule 405; Rule 415
|
|
4.5(k)(vi)
|
|
Savings and
Loan Holding Company
|
|
4.11
|
|
Schedules
|
|
Recitals
|
|
SEC
|
|
2.1(b)
|
|
Securities
Act
|
|
2.2(a)
|
|
Selling
Expenses
|
|
4.5(k)(vii)
|
|
Senior
Executive Officers
|
|
4.10
|
|
Share Dilution
Amount
|
|
4.8(a)(ii)
|
|
Shelf
Registration Statement
|
|
4.5(a)(ii)
|
|
Signing
Date
|
|
2.1(a)
|
|
Special
Registration
|
|
4.5(i)
|
|
Stockholder
Proposals
|
|
3.1(b)
|
|
subsidiary
|
|
5.8(a)
|
|
Tax;
Taxes
|
|
2.2(o)
|
|
Transfer
|
|
4.4
|
|
Warrants
|
|
Recitals
|
|
Warrant
Shares
|
|
2.2(d)
|
Exhibit 10.01
SECURITIES PURCHASE AGREEMENT
– STANDARD TERMS
Recitals:
WHEREAS, the United States Department of the
Treasury (the “ Investor ”) may from time to
time agree to purchase shares of preferred stock and warrants from
eligible financial institutions which elect to participate in the
Troubled Asset Relief Program Capital Purchase Program (“
CPP ”);
WHEREAS, an eligible financial institution
electing to participate in the CPP and issue securities to the
Investor (referred to herein as the “ Company ”)
shall enter into a letter agreement (the “ Letter
Agreement ”) with the Investor which incorporates this
Securities Purchase Agreement – Standard Terms;
WHEREAS, the Company agrees to expand the flow
of credit to U.S. consumers and businesses on competitive terms to
promote the sustained growth and vitality of the U.S.
economy;
WHEREAS, the Company agrees to work diligently,
under existing programs, to modify the terms of residential
mortgages as appropriate to strengthen the health of the U.S.
housing market;
WHEREAS, the Company intends to issue in a
private placement the number of shares of the series of its
Preferred Stock (“ Preferred Stock ”) set forth
on Schedule A to the Letter Agreement (the “
Preferred Shares ”) and a warrant to purchase the
number of shares of its Common Stock (“ Common Stock
”) set forth on Schedule A to the Letter Agreement
(the “ Initial Warrant Shares ”) (the “
Warrant ” and, together with the
Preferred Shares, the “ Purchased Securities ”)
and the Investor intends to purchase (the “ Purchase
”) from the Company the Purchased Securities; and
WHEREAS, the Purchase will be governed by this
Securities Purchase Agreement – Standard Terms and the Letter
Agreement, including the schedules thereto (the “
Schedules ”), specifying additional terms of the
Purchase. This Securities Purchase Agreement – Standard Terms
(including the Annexes hereto) and the Letter Agreement (including
the Schedules thereto) are together referred to as this
“Agreement”. All references in this
Securities Purchase Agreement – Standard Terms to
“Schedules” are to the Schedules attached to the Letter
Agreement.
NOW, THEREFORE , in consideration of the premises, and of the
representations, warranties, covenants and agreements set forth
herein, the parties agree as follows:
Exhibit 10.01
Purchase; Closing
Purchase . On the terms and subject to the conditions set
forth in this Agreement, the Company agrees to sell to the
Investor, and the Investor agrees to purchase from the Company, at
the Closing (as hereinafter defined), the Purchased Securities for
the price set forth on Schedule A (the “ Purchase
Price ”).
Closing .
On the terms and subject to the conditions set
forth in this Agreement, the closing of the Purchase (the “
Closing ”) will take place at the location specified
in Schedule A , at the time and on the date set forth in
Schedule A or as soon as practicable thereafter, or at such
other place, time and date as shall be agreed between the Company
and the Investor. The time and date on which the Closing occurs is
referred to in this Agreement as the “ Closing Date
”.
Subject to the fulfillment or waiver of the
conditions to the Closing in this Section 1.2, at the Closing the
Company will deliver the Preferred Shares and the Warrant, in each
case as evidenced by one or more certificates dated the Closing
Date and bearing appropriate legends as hereinafter provided for,
in exchange for payment in full of the Purchase Price by wire
transfer of immediately available United States funds to a bank
account designated by the Company on Schedule A .
The respective obligations of each of the
Investor and the Company to consummate the Purchase are subject to
the fulfillment (or waiver by the Investor and the Company, as
applicable) prior to the Closing of the conditions that (i) any
approvals or authorizations of all United States and other
governmental, regulatory or judicial authorities (collectively,
“ Governmental Entities ”) required for the
consummation of the Purchase shall have been obtained or made in
form and substance reasonably satisfactory to each party and shall
be in full force and effect and all waiting periods required by
United States and other applicable law, if any, shall have expired
and (ii) no provision of any applicable United States or other law
and no judgment, injunction, order or decree of any Governmental
Entity shall prohibit the purchase and sale of the Purchased
Securities as contemplated by this Agreement.
The obligation of the Investor to consummate the
Purchase is also subject to the fulfillment (or waiver by the
Investor) at or prior to the Closing of each of the following
conditions:
(A) the representations and warranties of the
Company set forth in (x) Section 2.2(g) of this Agreement shall be
true and correct in all respects as though made on and as of the
Closing Date, (y) Sections 2.2(a) through (f) shall be true and
correct in all material respects as though made on and as of the
Closing Date (other than representations and warranties that by
their terms speak as of another date, which representations and
warranties shall be true and correct in all material respects as of
such other date) and (z) Sections 2.2(h) through (v) (disregarding
all qualifications or limitations set forth in such representations
and warranties as to “materiality”, “Company
Material Adverse Effect” and words of similar import) shall
be true and correct as though made on and as of the Closing Date
(other than representations and warranties that by their terms
speak as of another date, which representations and warranties
shall be true and correct as of such other date), except to the
extent that the failure of such representations and warranties
referred to in this Section 1.2(d)(i)(A)(z) to be so true and
correct, individually or in the aggregate, does not have and would
not reasonably be expected to have a Company Material Adverse
Effect and (B) the Company shall have performed in all material
respects all obligations required to be performed by it under this
Agreement at or prior to the Closing;
Exhibit 10.01
the Investor shall have received a certificate
signed on behalf of the Company by a senior executive officer
certifying to the effect that the conditions set forth in Section
1.2(d)(i) have been satisfied;
the Company shall have duly adopted and filed
with the Secretary of State of its jurisdiction of organization or
other applicable Governmental Entity the amendment to its
certificate or articles of incorporation, articles of association,
or similar organizational document (“ Charter
”) in substantially the form attached hereto as
Annex A (the “ Certificate of
Designations ”) and such filing shall have been
accepted;
(A) the Company shall have effected such changes
to its compensation, bonus, incentive and other benefit plans,
arrangements and agreements (including golden parachute, severance
and employment agreements) (collectively, “ Benefit
Plans ”) with respect to its Senior Executive Officers
(and to the extent necessary for such changes to be legally
enforceable, each of its Senior Executive Officers shall have duly
consented in writing to such changes), as may be necessary, during
the period that the Investor owns any debt or equity securities of
the Company acquired pursuant to this Agreement or the Warrant, in
order to comply with Section 111(b) of the Emergency Economic
Stabilization Act of 2008 (“ EESA ”) as
implemented by guidance or regulation thereunder that has been
issued and is in effect as of the Closing Date, and (B) the
Investor shall have received a certificate signed on behalf of the
Company by a senior executive officer certifying to the effect that
the condition set forth in Section 1.2(d)(iv)(A) has been
satisfied;
each of the Company’s Senior Executive
Officers shall have delivered to the Investor a written waiver in
the form attached hereto as Annex B releasing the Investor
from any claims that such Senior Executive Officers may otherwise
have as a result of the issuance, on or prior to the Closing Date,
of any regulations which require the modification of, and the
agreement of the Company hereunder to modify, the terms of any
Benefit Plans with respect to its Senior Executive Officers to
eliminate any provisions of such Benefit Plans that would not be in
compliance with the requirements of Section 111(b) of the EESA as
implemented by guidance or regulation thereunder that has been
issued and is in effect as of the Closing Date;
Exhibit 10.01
the Company shall have delivered to the Investor
a written opinion from counsel to the Company (which may be
internal counsel), addressed to the Investor and dated as of the
Closing Date, in substantially the form attached hereto as Annex
C ;
the Company shall have delivered certificates in
proper form or, with the prior consent of the Investor, evidence of
shares in book-entry form, evidencing the Preferred Shares to
Investor or its designee(s); and
the Company shall have duly executed the Warrant
in substantially the form attached hereto as Annex D and
delivered such executed Warrant to the Investor or its
designee(s).
Interpretation . When a reference is made in this Agreement to
“Recitals,” “Articles,”
“Sections,” or “Annexes” such reference
shall be to a Recital, Article or Section of, or Annex to, this
Securities Purchase Agreement – Standard Terms, and a
reference to “Schedules” shall be to a Schedule to the
Letter Agreement, in each case, unless otherwise indicated. The
terms defined in the singular have a comparable meaning when used
in the plural, and vice versa. References to “herein”,
“hereof”, “hereunder” and the like refer to
this Agreement as a whole and not to any particular section or
provision, unless the context requires otherwise. The table of
contents and headings contained in this Agreement are for reference
purposes only and are not part of this Agreement. Whenever the
words “include,” "includes” or
“including” are used in this Agreement, they shall be
deemed followed by the words “without limitation.” No
rule of construction against the draftsperson shall be applied in
connection with the interpretation or enforcement of this
Agreement, as this Agreement is the product of negotiation between
sophisticated parties advised by counsel. All references to
“$” or “dollars” mean the lawful currency
of the United States of America. Except as expressly stated in this
Agreement, all references to any statute, rule or regulation are to
the statute, rule or regulation as amended, modified, supplemented
or replaced from time to time (and, in the case of statutes,
include any rules and regulations promulgated under the statute)
and to any section of any statute, rule or regulation include any
successor to the section. References to a “ business
day ” shall mean any day except Saturday, Sunday and any
day on which banking institutions in the State of New York
generally are authorized or required by law or other governmental
actions to close.
Exhibit 10.01
Representations and
Warranties
Disclosure .
“ Company Material Adverse Effect
” means a material adverse effect on (i) the business,
results of operation or financial condition of the Company and its
consolidated subsidiaries taken as a whole; provided ,
however , that Company Material Adverse Effect shall not be
deemed to include the effects of (A) changes after the date of the
Letter Agreement (the “ Signing Date ”) in
general business, economic or market conditions (including changes
generally in prevailing interest rates, credit availability and
liquidity, currency exchange rates and price levels or trading
volumes in the United States or foreign securities or credit
markets), or any outbreak or escalation of hostilities, declared or
undeclared acts of war or terrorism, in each case generally
affecting the industries in which the Company and its subsidiaries
operate, (B) changes or proposed changes after the Signing Date in
generally accepted accounting principles in the United States
(“ GAAP ”) or regulatory accounting
requirements, or authoritative interpretations thereof, (C) changes
or proposed changes after the Signing Date in securities, banking
and other laws of general applicability or related policies or
interpretations of Governmental Entities (in the case of each of
these clauses (A), (B) and (C), other than changes or occurrences
to the extent that such changes or occurrences have or would
reasonably be expected to have a materially disproportionate
adverse effect on the Company and its consolidated subsidiaries
taken as a whole relative to comparable U.S. banking or financial
services organizations), or (D) changes in the market price or
trading volume of the Common Stock or any other equity,
equity-related or debt securities of the Company or its
consolidated subsidiaries (it being understood and agreed that the
exception set forth in this clause (D) does not apply to the
underlying reason giving rise to or contributing to any such
change); or (ii) the ability of the Company to consummate the
Purchase and the other transactions contemplated by this Agreement
and the Warrant and perform its obligations hereunder or thereunder
on a timely basis.
“ Previously Disclosed ”
means information set forth or incorporated in the Company’s
Annual Report on Form 10-K for the most recently completed fiscal
year of the Company filed with the Securities and Exchange
Commission (the “ SEC ”) prior to the Signing
Date (the “ Last Fiscal Year ”) or in its other
reports and forms filed with or furnished to the SEC under Sections
13(a), 14(a) or 15(d) of the Securities Exchange Act of 1934 (the
“ Exchange Act ”) on or after the last day of
the Last Fiscal Year and prior to the Signing Date.
Representations and Warranties of the
Company . Except as
Previously Disclosed, the Company represents and warrants to the
Investor that as of the Signing Date and as of the Closing Date (or
such other date specified herein):
Exhibit 10.01
Organization, Authority and Significant
Subsidiaries . The
Company has been duly incorporated and is validly existing and in
good standing under the laws of its jurisdiction of organization,
with the necessary power and authority to own its properties and
conduct its business in all material respects as currently
conducted, and except as has not, individually or in the aggregate,
had and would not reasonably be expected to have a Company Material
Adverse Effect, has been duly qualified as a foreign corporation
for the transaction of business and is in good standing under the
laws of each other jurisdiction in which it owns or leases
properties or conducts any business so as to require such
qualification; each subsidiary of the Company that is a
“significant subsidiary” within the meaning of Rule
1-02(w) of Regulation S-X under the Securities Act of 1933 (the
“ Securities Act ”) has been duly organized and
is validly existing in good standing under the laws of its
jurisdiction of organization. The Charter and bylaws of
the Company, copies of which have been provided to the Investor
prior to the Signing Date, are true, complete and correct copies of
such documents as in full force and effect as of the Signing
Date.
Capitalization . The authorized capital stock of the Company,
and the outstanding capital stock of the Company (including
securities convertible into, or exercisable or exchangeable for,
capital stock of the Company) as of the most recent fiscal
month-end preceding the Signing Date (the “ Capitalization
Date ”) is set forth on Schedule B
. The outstanding shares of capital stock of the Company
have been duly authorized and are validly issued and outstanding,
fully paid and nonassessable, and subject to no preemptive rights
(and were not issued in violation of any preemptive rights). Except
as provided in the Warrant, as of the Signing Date, the Company
does not have outstanding any securities or other obligations
providing the holder the right to acquire Common Stock that is not
reserved for issuance as specified on Schedule B , and the
Company has not made any other commitment to authorize, issue or
sell any Common Stock. Since the Capitalization Date,
the Company has not issued any shares of Common Stock, other than
(i) shares issued upon the exercise of stock options or delivered
under other equity-based awards or other convertible securities or
warrants which were issued and outstanding on the Capitalization
Date and disclosed on Schedule B and (ii) shares disclosed
on Schedule B .
Preferred Shares . The Preferred Shares have been duly and
validly authorized, and, when issued and delivered pursuant to this
Agreement, such Preferred Shares will be duly and validly issued
and fully paid and non-assessable, will not be issued in violation
of any preemptive rights, and will rank pari passu with or
senior to all other series or classes of Preferred Stock, whether
or not issued or outstanding, with respect to the payment of
dividends and the distribution of assets in the event of any
dissolution, liquidation or winding up of the Company.
The Warrant and Warrant Shares
. The Warrant has been duly
authorized and, when executed and delivered as contemplated hereby,
will constitute a valid and legally binding obligation of the
Company enforceable against the Company in accordance with its
terms, except as the same may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting
the enforcement of creditors’ rights generally and general
equitable principles, regardless of whether such enforceability is
considered in a proceeding at law or in equity (“
Bankruptcy Exceptions ”). The shares of Common Stock
issuable upon exercise of the Warrant (the “ Warrant
Shares ”) have been duly authorized and reserved for
issuance upon exercise of the Warrant and when so issued in
accordance with the terms of the Warrant will be validly issued,
fully paid and non-assessable, subject, if applicable, to the
approvals of its stockholders set forth on Schedule C
.
Exhibit 10.01
Authorization, Enforceability
.
The Company has the corporate power and
authority to execute and deliver this Agreement and the Warrant
and, subject, if applicable, to the approvals of its stockholders
set forth on Schedule C , to carry out its
obligations hereunder and thereunder (which includes the issuance
of the Preferred Shares, Warrant and Warrant Shares). The
execution, delivery and performance by the Company of this
Agreement and the Warrant and the consummation of the transactions
contemplated hereby and thereby have been duly authorized by all
necessary corporate action on the part of the Company and its
stockholders, and no further approval or authorization is required
on the part of the Company, subject, in each case, if applicable,
to the approvals of its stockholders set forth on Schedule C
. This Agreement is a valid and binding obligation of the Company
enforceable against the Company in accordance with its terms,
subject to the Bankruptcy Exceptions.
The execution, delivery and performance by the
Company of this Agreement and the Warrant and the consummation of
the transactions contemplated hereby and thereby and compliance by
the Company with the provisions hereof and thereof, will not (A)
violate, conflict with, or result in a breach of any provision of,
or constitute a default (or an event which, with notice or lapse of
time or both, would constitute a default) under, or result in the
termination of, or accelerate the performance required by, or
result in a right of termination or acceleration of, or result in
the creation of, any lien, security interest, charge or encumbrance
upon any of the properties or assets of the Company or any Company
Subsidiary under any of the terms, conditions or provisions of (i)
subject, if applicable, to the approvals of the Company’s
stockholders set forth on Schedule C , its organizational
documents or (ii) any note, bond, mortgage, indenture, deed of
trust, license, lease, agreement or other instrument or obligation
to which the Company or any Company Subsidiary is a party or by
which it or any Company Subsidiary may be bound, or to which the
Company or any Company Subsidiary or any of the properties or
assets of the Company or any Company Subsidiary may be subject, or
(B) subject to compliance with the statutes and regulations
referred to in the next paragraph, violate any statute, rule or
regulation or any judgment, ruling, order, writ, injunction or
decree applicable to the Company or any Company Subsidiary or any
of their respective properties or assets except, in the case of
clauses (A)(ii) and (B), for those occurrences that, individually
or in the aggregate, have not had and would not reasonably be
expected to have a Company Material Adverse Effect.
Exhibit 10.01
Other than the filing of the Certificate of
Designations with the Secretary of State of its jurisdiction of
organization or other applicable Governmental Entity, any current
report on Form 8-K required to be filed with the SEC, such filings
and approvals as are required to be made or obtained under any
state “blue sky” laws, the filing of
any proxy statement contemplated by Section
3.1 and such as have been made or obtained, no notice to, filing
with, exemption or review by, or authorization, consent or approval
of, any Governmental Entity is required to be made or obtained by
the Company in connection with the consummation by the Company of
the Purchase except for any such notices, filings, exemptions,
reviews, authorizations, consents and approvals the failure of
which to make or obtain would not, individually or in the
aggregate, reasonably be expected to have a Company Material
Adverse Effect.
Anti-takeover Provisions and Rights
Plan . The
Board of Directors of the Company (the “ Board of
Directors ”) has taken all necessary action to ensure
that the transactions contemplated by this Agreement and the
Warrant and the consummation of the transactions contemplated
hereby and thereby, including the exercise of the Warrant in
accordance with its terms, will be exempt from any anti-takeover or
similar provisions of the Company’s Charter and bylaws, and
any other provisions of any applicable “moratorium”,
“control share”, “fair price”,
“interested stockholder” or other anti-takeover laws
and regulations of any jurisdiction. The Company has
taken all actions necessary to render any stockholders’
rights plan of the Company inapplicable to this Agreement and the
Warrant and the consummation of the transactions contemplated
hereby and thereby, including the exercise of the Warrant by the
Investor in accordance with its terms.
No Company Material Adverse Effect
. Since the last day of the last
completed fiscal period for which the Company has filed a Quarterly
Report on Form 10-Q or an Annual Report on Form 10-K with the SEC
prior to the Signing Date, no fact, circumstance, event, change,
occurrence, condition or development has occurred that,
individually or in the aggregate, has had or would reasonably be
expected to have a Company Material Adverse Effect.
Company Financial Statements
. Each of the
consolidated financial statements of the Company and its
consolidated subsidiaries (collectively the “ Company
Financial Statements ”) included or incorporated by
reference in the Company Reports filed with the SEC since December
31, 2006, present fairly in all material respects the consolidated
financial position of the Company and its consolidated subsidiaries
as of the dates indicated therein (or if amended prior to the
Signing Date, as of the date of such amendment) and the
consolidated results of their operations for the periods specified
therein; and except as stated therein, such financial statements
(A) were prepared in conformity with GAAP applied on a consistent
basis (except as may be noted therein), (B) have been prepared
from, and are in accordance with, the books and records of the
Company and the Company Subsidiaries and (C) complied as to form,
as of their respective dates of filing with the SEC, in all
material respects with the applicable accounting requirements and
with the published rules and regulations of the SEC with respect
thereto.
Exhibit 10.01
Reports .
Since December 31, 2006, the Company and each
subsidiary of the Company (each a “ Company Subsidiary
” and, collectively, the “ Company Subsidiaries
”) has timely filed all reports, registrations, documents,
filings, statements and submissions, together with any amendments
thereto, that it was required to file with any Governmental Entity
(the foregoing, collectively, the “ Company Reports
”) and has paid all fees and assessments due and payable in
connection therewith, except, in each case, as would not,
individually or in the aggregate, reasonably be expected to have a
Company Material Adverse Effect. As of their respective
dates of filing, the Company Reports complied in all material
respects with all statutes and applicable rules and regulations of
the applicable Governmental Entities. In the case of
each such Company Report filed with or furnished to the SEC, such
Company Report (A) did not, as of its date or if amended prior to
the Signing Date, as of the date of such amendment, contain an
untrue statement of a material fact or omit to state a material
fact necessary in order to make the statements made therein, in
light of the circumstances under which they were made, not
misleading, and (B) complied as to form in all material respects
with the applicable requirements of the Securities Act and the
Exchange Act. With respect to all other Company Reports,
the Company Reports were complete and accurate in all material
respects as of their respective dates. No executive
officer of the Company or any Company Subsidiary has failed in any
respect to make the certifications required of him or her under
Section 302 or 906 of the Sarbanes-Oxley Act of 2002.
The records, systems, controls, data and
information of the Company and the Company Subsidiaries are
recorded, stored, maintained and operated under means (including
any electronic, mechanical or photographic process, whether
computerized or not) that are under the exclusive ownership and
direct control of the Company or the Company Subsidiaries or their
accountants (including all means of access thereto and therefrom),
except for any non-exclusive ownership and non-direct control that
would not reasonably be expected to have a material adverse effect
on the system of internal accounting controls described below in
this Section 2.2(i)(ii). The Company (A) has implemented
and maintains disclosure controls and procedures (as defined in
Rule 13a-15(e) of the Exchange Act) to ensure that material
information relating to the Company, including the consolidated
Company Subsidiaries, is made known to the chief executive officer
and the chief financial officer of the Company by others within
those entities, and (B) has disclosed, based on its most recent
evaluation prior to the Signing Date, to the Company’s
outside auditors and the audit committee of the Board of Directors
(x) any significant deficiencies and material weaknesses in the
design or operation of internal controls over financial reporting
(as defined in Rule 13a-15(f) of the Exchange Act) that are
reasonably likely to adversely affect the Company’s ability
to record, process, summarize and report financial information and
(y) any fraud, whether or not material, that involves management or
other employees who have a significant role in the Company’s
internal controls over financial reporting.
Exhibit 10.01
No Undisclosed Liabilities
. Neither the Company nor
any of the Company Subsidiaries has any liabilities or obligations
of any nature (absolute, accrued, contingent or otherwise) which
are not properly reflected or reserved against in the Company
Financial Statements to the extent required to be so reflected or
reserved against in accordance with GAAP, except for (A)
liabilities that have arisen since the last fiscal year end in the
ordinary and usual course of business and consistent with past
practice and (B) liabilities that, individually or in the
aggregate, have not had and would not reasonably be expected to
have a Company Material Adverse Effect.
Offering of Securities . Neither the Company nor any person
acting on its behalf has taken any action (including any offering
of any securities of the Company under circumstances which would
require the integration of such offering with the offering of any
of the Purchased Securities under the Securities Act, and the rules
and regulations of the SEC promulgated thereunder), which might
subject the offering, issuance or sale of any of the Purchased
Securities to Investor pursuant to this Agreement to the
registration requirements of the Securities Act.
Litigation and Other Proceedings
. Except (i) as set forth
on Schedule D or (ii) as would not, individually or in the
aggregate, reasonably be expected to have a Company Material
Adverse Effect, there is no (A) pending or, to the knowledge of the
Company, threatened, claim, action, suit, investigation or
proceeding, against the Company or any Company Subsidiary or to
which any of their assets are subject nor is the Company or any
Company Subsidiary subject to any order, judgment or decree or (B)
unresolved violation, criticism or exception by any Governmental
Entity with respect to any report or relating to any examinations
or inspections of the Company or any Company
Subsidiaries.
Exhibit 10.01
Compliance with Laws. Except as would not, individually or
in the aggregate, reasonably be expected to have a Company Material
Adverse Effect, the Company and the Company Subsidiaries have all
permits, licenses, franchises, authorizations, orders and approvals
of, and have made all filings, applications and registrations with,
Governmental Entities that are required in order to permit them to
own or lease their properties and assets and to carry on their
business as presently conducted and that are material to the
business of the Company or such Company
Subsidiary. Except as set forth on Schedule E ,
the Company and the Company Subsidiaries have complied in all
respects and are not in default or violation of, and none of them
is, to the knowledge of the Company, under investigation with
respect to or, to the knowledge of the Company, have been
threatened to be charged with or given notice of any violation of,
any applicable domestic (federal, state or local) or foreign law,
statute, ordinance, license, rule, regulation, policy or guideline,
order, demand, writ, injunction, decree or judgment of any
Governmental Entity, other than such noncompliance, defaults or
violations that would not, individually or in the aggregate,
reasonably be expected to have a Company Material Adverse
Effect. Except for statutory or regulatory restrictions
of general application or as set forth on Schedule E , no
Governmental Entity has placed any restriction on the business or
properties of the Company or any Company Subsidiary that would,
individually or in the aggregate, reasonably be expected to have a
Company Material Adverse Effect.
Employee Benefit Matters . Except as would not reasonably be
expected to have, either individually or in the aggregate, a
Company Material Adverse Effect: (A) each “employee benefit
plan” (within the meaning of Section 3(3) of the Employee
Retirement Income Security Act of 1974, as amended (“
ERISA ”)) providing benefits to any current or former
employee, officer or director of the Company or any member of its
“ Controlled Group ” (defined as any
organization which is a member of a controlled group of
corporations within the meaning of Section 414 of the Internal
Revenue Code of 1986, as amended (the “ Code ”))
that is sponsored, maintained or contributed to by the Company or
any member of its Controlled Group and for which the Company or any
member of its Controlled Group would have any liability, whether
actual or contingent (each, a “ Plan ”) has been
maintained in compliance with its terms and with the requirements
of all applicable statutes, rules and regulations, including ERISA
and the Code; (B) with respect to each Plan subject to Title IV of
ERISA (including, for purposes of this clause (B), any plan subject
to Title IV of ERISA that the Company or any member of its
Controlled Group previously maintained or contributed to in the six
years prior to the Signing Date), (1) no “reportable
event” (within the meaning of Section 4043(c) of
ERISA), other than a reportable event for which the
notice period referred to in Section 4043(c) of ERISA has been
waived, has occurred in the three years prior to the Signing Date
or is reasonably expected to occur, (2) no “accumulated
funding deficiency” (within the meaning of Section 302 of
ERISA or Section 412 of the Code), whether or not waived, has
occurred in the three years prior to the Signing Date or is
reasonably expected to occur, (3) the fair market value of the
assets under each Plan exceeds the present value of all benefits
accrued under such Plan (determined based on the assumptions used
to fund such Plan) and (4) neither the Company nor any member of
its Controlled Group has incurred in the six years prior to the
Signing Date, or reasonably expects to incur, any liability under
Title IV of ERISA (other than contributions to the Plan or premiums
to the PBGC in the ordinary course and without default) in respect
of a Plan (including any Plan that is a “multiemployer
plan”, within the meaning of Section 4001(c)(3) of ERISA);
and (C) each Plan that is intended to be qualified under Section
401(a) of the Code has received a favorable determination letter
from the Internal Revenue Service with respect to its qualified
status that has not been revoked, or such a determination letter
has been timely applied for but not received by the Signing Date,
and nothing has occurred, whether by action or by failure to act,
which could reasonably be expected to cause the loss, revocation or
denial of such qualified status or favorable determination
letter.
Exhibit 10.01
Taxes . Except as would not, individually
or in the aggregate, reasonably be expected to have a Company
Material Adverse Effect, (i) the Company and the Company
Subsidiaries have filed all federal, state, local and foreign
income and franchise Tax returns required to be filed through the
Signing Date, subject to permitted extensions, and have paid all
Taxes due thereon, and (ii) no Tax deficiency has been determined
adversely to the Company or any of the Company Subsidiaries, nor
does the Company have any knowledge of any Tax
deficiencies. “ Tax ” or “
Taxes ” means any federal, state, local or foreign
income, gross receipts, property, sales, use, license, excise,
franchise, employment, payroll, withholding, alternative or add on
minimum, ad valorem, transfer or excise tax, or any other tax,
custom, duty, governmental fee or other like assessment or charge
of any kind whatsoever, together with any interest or penalty,
imposed by any Governmental Entity.
Properties and Leases . Except as would not, individually or in
the aggregate, reasonably be expected to have a Company Material
Adverse Effect, the Company and the Company Subsidiaries have good
and marketable title to all real properties and all other
properties and assets owned by them, in each case free from liens,
encumbrances, claims and defects that would affect the value
thereof or interfere with the use made or to be made thereof by
them. Except as would not, individually or in the
aggregate, reasonably be expected to have a Company Material
Adverse Effect, the Company and the Company Subsidiaries hold all
leased real or personal property under valid and enforceable leases
with no exceptions that would interfere with the use made or to be
made thereof by them.
Environmental Liability . Except as would not, individually or in
the aggregate, reasonably be expected to have a Company Material
Adverse Effect:
Exhibit 10.01
there is no legal, administrative, or other
proceeding, claim or action of any nature seeking to impose, or
that would reasonably be expected to result in the imposition of,
on the Company or any Company Subsidiary, any liability relating to
the release of hazardous substances as defined under any local,
state or federal environmental statute, regulation or ordinance,
including the Comprehensive Environmental Response, Compensation
and Liability Act of 1980, pending or, to the Company’s
knowledge, threatened against the Company or any Company
Subsidiary;
to the Company’s knowledge, there is no
reasonable basis for any such proceeding, claim or action;
and
neither the Company nor any Company Subsidiary
is subject to any agreement, order, judgment or decree by or with
any court, Governmental Entity or third party imposing any such
environmental liability.
Risk Management Instruments
. Except as would not,
individually or in the aggregate, reasonably be expected to have a
Company Material Adverse Effect, all derivative instruments,
including, swaps, caps, floors and option agreements, whether
entered into for the Company’s own account, or for the
account of one or more of the Company Subsidiaries or its or their
customers, were entered into (i) only in the ordinary course of
business, (ii) in accordance with prudent practices and in all
material respects with all applicable laws, rules, regulations and
regulatory policies and (iii) with counterparties believed to be
financially responsible at the time; and each of such instruments
constitutes the valid and legally binding obligation of the Company
or one of the Company Subsidiaries, enforceable in accordance with
its terms, except as may be limited by the Bankruptcy
Exceptions. Neither the Company or the Company
Subsidiaries, nor, to the knowledge of the Company, any other party
thereto, is in breach of any of its obligations under any such
agreement or arrangement other than such breaches that would not,
individually or in the aggregate, reasonably be expected to have a
Company Material Adverse Effect.
Agreements with Regulatory Agencies
. Except as set forth on
Schedule F , neither the Company nor any Company Subsidiary
is subject to any material cease-and-desist or other similar order
or enforcement action issued by, or is a party to any material
written agreement, consent agreement or memorandum of understanding
with, or is a party to any commitment letter or similar undertaking
to, or is subject to any capital directive by, or since December
31, 2006, has adopted any board resolutions at the request of, any
Governmental Entity (other than the Appropriate Federal Banking
Agencies with jurisdiction over the Company and the Company
Subsidiaries) that currently restricts in any material respect the
conduct of its business or that in any material manner relates to
its capital adequacy, its liquidity and funding policies and
practices, its ability to pay dividends, its credit, risk
management or compliance policies or procedures, its internal
controls, its management or its operations or business (each item
in this sentence, a “ Regulatory Agreement ”),
nor has the Company or any Company Subsidiary been advised since
December 31, 2006 by any such Governmental Entity that it is
considering issuing, initiating, ordering, or requesting any such
Regulatory Agreement. The Company and each Company
Subsidiary are in compliance in all material respects with each
Regulatory Agreement to which it is party or subject, and neither
the Company nor any Company Subsidiary has received any notice from
any Governmental Entity indicating that either the Company or any
Company Subsidiary is not in compliance in all material respects
with any such Regulatory Agreement. " Appropriate
Federal Banking Agency " means the “appropriate Federal
banking agency” with respect to the Company or such Company
Subsidiaries, as applicable, as defined in Section 3(q) of the
Federal Deposit Insurance Act (12 U.S.C. Section
1813(q)).
Exhibit 10.01
Insurance . The Company and the Company
Subsidiaries are insured with reputable insurers against such risks
and in such amounts as the management of the Company reasonably has
determined to be prudent and consistent with industry
practice. The Company and the Company Subsidiaries are
in material compliance with their insurance policies and are not in
default under any of the material terms thereof, each such policy
is outstanding and in full force and effect, all premiums and other
payments due under any material policy have been paid, and all
claims thereunder have been filed in due and timely fashion,
except, in each case, as would not, individually or in the
aggregate, reasonably be expected to have a Company Material
Adverse Effect.
Intellectual Property . Except as would not, individually
or in the aggregate, reasonably be expected to have a
Company Material Adverse Effect, (i) the Company and each Company
Subsidiary owns or otherwise has the right to use, all intellectual
property rights, including all trademarks, trade dress, trade
names, service marks, domain names, patents, inventions, trade
secrets, know-how, works of authorship and copyrights therein, that
are used in the conduct of their existing businesses and all rights
relating to the plans, design and specifications of any of its
branch facilities (“ Proprietary Rights ”) free
and clear of all liens and any claims of ownership by current or
former employees, contractors, designers or others and (ii) neither
the Company nor any of the Company Subsidiaries is materially
infringing, diluting, misappropriating or violating, nor has the
Company or any or the Company Subsidiaries received any written
(or, to the knowledge of the Company, oral) communications alleging
that any of them has materially infringed, diluted, misappropriated
or violated, any of the Proprietary Rights owned by any other
person. Except as would not, individually or in the
aggregate, reasonably be expected to have a Company Material
Adverse Effect, to the Company’s knowledge, no other person
is infringing, diluting, misappropriating or violating, nor has the
Company or any or the Company Subsidiaries sent any written
communications since January 1, 2006 alleging that any person has
infringed, diluted, misappropriated or violated, any of the
Proprietary Rights owned by the Company and the Company
Subsidiaries.
Exhibit 10.01
Brokers and Finders . No broker, finder or investment
banker is entitled to any financial advisory, brokerage, finder's
or other fee or commission in connection with this Agreement or the
Warrant or the transactions contemplated hereby or thereby based
upon arrangements made by or on behalf of the Company or any
Company Subsidiary for which the Investor could have any
liability.
Covenants
Commercially Reasonable Efforts
.
Subject to the terms and conditions of this
Agreement, each of the parties will use its commercially reasonable
efforts in good faith to take, or cause to be taken, all actions,
and to do, or cause to be done, all things necessary, proper or
desirable, or advisable under applicable laws, so as to permit
consummation of the Purchase as promptly as practicable and
otherwise to enable consummation of the transactions contemplated
hereby and shall use commercially reasonable efforts to cooperate
with the other party to that end.
If the Company is required to obtain any
stockholder approvals set forth on Schedule C , then the
Company shall comply with this Section 3.1(b) and Section 3.1(c).
The Company shall call a special meeting of its stockholders, as
promptly as practicable following the Closing, to vote on proposals
(collectively, the “ Stockholder Proposals ”) to
(i) approve the exercise of the Warrant for Common Stock for
purposes of the rules of the national security exchange on which
the Common Stock is listed and/or (ii) amend the Company’s
Charter to increase the number of author
