Exhibit 10.3.2
EXECUTION COPY
PUT AGREEMENT
This PUT AGREEMENT (this "Put Agreement"),
dated as of January 26, 2005, by and
between Sutter Holding Company, Inc., a
Delaware Corporation (the "Company") and
MacKenzie Patterson Fuller, Inc., a
California corporation (the "Investor").
Capitalized terms not otherwise defined
herein shall have the meanings assigned
to them in the Certificate of Designations,
Preferences and Rights of Series A
Convertible Preferred Stock of Sutter (the
"Series A Certificate").
W I T N E S S E T H:
WHEREAS, pursuant to that certain Purchase Agreement (the
"Purchase
Agreement") dated as of the date hereof by
and between the Company and the
Investor, the Investor has agreed to
purchase and the Company has agreed to sell
certain shares (the "Shares") of Series A
Preferred Stock, par value $0.0001 per
share.
NOW, THEREFORE, in consideration of the
mutual agreements contained herein and
in reliance on the representations and
warranties contained herein and for other
good and valuable consideration, the
receipt of which is hereby acknowledged,
and intending to be legally bound hereby,
the parties hereto agree as follows:
1. Put
Arrangements.
(a) The
Investor shall have the right (such right, the "Put") to
require
the Company at any time with at least 90 days prior written notice
(the
"Put Notice"), to repurchase effective as of the third anniversary
of
the date hereof or any time thereafter, all, but not less than all,
of
the Shares held by the Investor at the time of such repurchase at
a
price equal to the Redemption Price as of the third anniversary of
the
date hereof (the "Put Price"); provided, the Investor may exercise
the
Put at the Put Price at any time after an Organic Change upon
delivering the Put Notice.
(b) If the Put
Notice has been timely delivered the Company shall, on or
after the third anniversary of the date hereof, purchase and
the
Investor shall sell all of the Shares owned by the Investor at the
time
of such
repurchase at the Put Price (the "Put Closing").
2. Key
Man Event Put.
(a) If the
Company receives payments from a life insurance policy due to
the death of R. Michael Collins, Robert Dixon or William Knuff,
III
(such payment, a "Key Man Event"), the Company shall inform the
Investor of the occurrence of a Key Man Event. The Investor shall
have
the right (such right, the "Key Man Put") to require the Company
to
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redeem the number of Shares (such shares, the "Key Man Shares")
equal
to: (x) the net proceeds from such Key Man Event divided by (y)
the
Redemption Price as of the third anniversary of the date hereof,
by
delivering a written notice within 90 days of receipt of notice of
the
occurrence of a Key Man Event specifying that the Investor is
exercising the Key Man Put (the "Key Man Put Notice").
(b) Within 10
Business Days of the delivery of the Key Man Put Notice, the
Company shall purchase and the Investor shall sell the Key Man
Shares
at the Put Price (each, a "Key Man Closing").
3. Put
Closing.
(a) At the Put
Closing, the Investor shall deliver to the Company
certificates representing all of the Shares owned by the Investor
as of
such date, free and clear of all liens and encumbrances and
duly
endorsed in blank or accompanied by duly executed forms of
assignment
(with signatures guaranteed), and the Company shall deliver to
the
Investor the Put Price by cashier's or certified check payable to
the
Investor or by wire transfer of immediately available funds to
an
account designated by the Investor.
(b) If: (i)
the Company, or any third party on behalf of the Company, is
unable to deliver the full amount of the Put Price at the Put
Closing
and (ii) as of the date of the Put Closing, the Investor owns 50%
or
more of the Shares that the Investor owned as of the date
hereof,
Investor may demand that the Company shall assign to the
Investor,
instead of and not in addition to the Put Price, all of its rights
to
all of the common shares of FLF, Inc. (d/b/a Diversified Risk
Insurance
Brokers)
("Diversified Risk") and the Investor shall deliver to the
Company certificates representing all of the Shares owned by
the
Investor as of such date, free and clear of all liens and
encumbrances
and duly endorsed in blank or accompanied by duly executed forms
of
assignment (with signatures guaranteed).
(c) If:
(i) the Company, or
any third party on behalf of the Company, is
unable to deliver the full amount of the Put Price at the Put
Closing
and (ii) as of the date of the Put Closing, the Investor owns less
than
50% of the Shares that the Investor owned as of the date hereof,
the
Investor may require the Company to promptly initiate the sale
of
Diversified Risk (the "Default Sale") in order to satisfy the
Company's
obligations under the Put, such Default Sale to be consummated
within
90 days of the Put Closing. Promptly upon consummation of the
Default
Sale, the Company shall deliver the full amount of the Put Price
and
the Investor shall deliver to the Company certificates representing
all
of the Shares owned by the Investor as of such date, free and clear
of
all liens and encumbrances and duly endorsed in blank or
accompanied by
duly executed forms of assignment (with signatures guaranteed).
4. Key
Man Closing. At any Key Man Closing, the Investor shall deliver
to
the Company certificates representing the Key Man Shares to be
repurchased by the Company free and clear of all liens and
encumbrances
2
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and duly endorsed in blank or accompanied by duly executed forms
of
assignment (with signatures guaranteed), and the Company shall
deliver
to the Investor an amount equal to: (x) the Redemption Price as of
the
third anniversary of the date hereof multiplied by (y) the number
of
Key Man Shares, by cashier's or certified check payable to the
Investor
or by wire transfer of immediately available funds to an
account
designated by the Investor.
5. Bank
Default. The Company
must promptly, inform the Investor of the
occurrence of any "Payment Default" (a, "Bank Event of Default")
as
such term is defined in the Business Loan Agreement by and between
Bank
of Alameda and Diversified Risk dated as of the date hereof (along
with
the documents executed along with such Business Loan Agreement,
the
"Bank of Alameda Loan Agreement"). The Investor may then deliver
a
notice (such notice, a "Bank Default Notice") informing the
Company
that that the Investor intends to cure Event of Default, such
notice to
be delivered as soon as possible, but in any event within five
(5)
Business Days. If:
(a) the Investor
timely delivers the Bank Default
Notice and (b) the Investor cures the Event of Default, the
Company
shall, unless barred from so doing by the provisions of the Bank
of
Alameda Loan Agreement, promptly assign to the Investor, instead of
and
not in addition to the Put Price, all of its rights to all of
the
common shares of Diversified Risk and the Investor shall deliver to
the
Company certificates representing all of the Shares owned by
the
Investor as of such date, free and clear of all liens and
encumbrances
and duly endorsed in blank or accompanied by duly executed forms
of
assignment (with
signatures guaranteed). If the Company is barred from
assigning its rights to all of the common shares of Diversified
Risk to
the Investor pursuant to the Bank of Alameda Loan Agreement,
the
Company will
