Exhibit 10.7
Stock Purchase Agreement
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (this "Agreement"), is dated as of August 21,
1996, by and among CAI Corporation, a Delaware corporation ("CAI"), Commercial
Federal Corporation, a Nebraska corporation ("CFC"), Mr. Robin R. Glackin
("Glackin"), Mr. Steven M. Ellis ("Ellis") and Mr. Bryon A. Lax ("Lax"). Each
of Glackin, Ellis and Lax is sometimes hereinafter referred to as a
"Shareholder", and collectively as the "Shareholders."
WHEREAS, CAI owns an aggregate of 1,250,100 shares of common stock, par value
$0.01 per share (the "CFC Common Stock"), of CFC; and
WHEREAS CFC owns the Warrant to Purchase 99 Shares of Common Stock (Par
Value $.01 per Share) of CAI Corporation, dated December 31, 1989 (the
"Warrant"), which entitles the holder thereof to purchase, upon exercise
thereof, 99 shares of non-voting common stock of CAI; and
WHEREAS, CFC desires to purchase from CAI the shares of CFC Common Stock owned
by CAI; and
WHEREAS, CAI wishes to acquire from CFC, and cancel, the Warrant; and
WHEREAS, the parties desire to make certain representations, warranties and
agreements in connection with the transactions contemplated hereby.
NOW, THEREFORE, in consideration of the mutual covenants, representations,
warranties and agreements contained herein, and intending to be legally bound
hereby, the parties agree as follows:
ARTICLE 1
SALE AND TRANSFER OF
COMMON STOCK; RETURN OF WARRANT
1.1 Sale and Transfer of Common Stock. Upon the basis of the representations,
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warranties and agreements herein contained, and subject to the terms and
conditions hereof, CAI agrees to sell, transfer and assign to CFC 1,250,100
shares of CFC Common Stock (such shares of CFC Common Stock are hereinafter
referred to as the "Shares"), in exchange for (i) a payment of $28,227,162
(the "Cash Consideration"), (ii) the transfer and assignment to CAI of the
Warrant (in whole and not in part), unexercised and free and clear of any
Liens (as defined herein), (iii) a payment of $2,200,000 in reimbursement
of certain costs and expenses incurred by CAI in connection with its
ownership of the Shares, including costs and expenses incurred in
connection with the proxy contest of 1995 (the "Expense Reimbursement
Payment"), and (iv) a payment of $62,500 as an agreed upon amount in lieu
of the pro rata portion of the dividend on the Shares of CFC's current
fiscal quarter (the "Dividend Amount").
1.2 Return of Warrant; Payment of Consideration. Upon the basis of the
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representations, warranties and agreements herein contained, and subject to
the terms and conditions hereof, CFC agrees to (i) purchase and accept from
CAI the Shares, (ii) transfer and assign the Warrant (in whole and not in
part), unexercised and free and clear of any Liens, to CAI, (iii) pay CAI
the Cash Consideration, (iv) pay CAI the Expense Reimbursement Payment and
(v) pay CAI the Dividend Amount.
1.3 Closing. The closing of the sale and purchase of the Shares and the
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other transactions contemplated hereby (the "Closing") shall take place in
Omaha, Nebraska on August 21, 1996, or at such other time or place as the
parties may mutually agree (the "Closing Date").
1.4 Closing Deliveries. At the Closing, the parties shall deliver the
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following documents, and take the following actions, all of which
deliveries and actions shall be deemed to occur simultaneously and none of
which shall be effective until all have occurred:
(a) CFC shall deliver, or cause to be delivered, to CAI (i) the Warrant (in
whole and not in part), duly endorsed, unexercised and free and clear
of any Liens, (ii) the Cash Consideration, the Expense Reimbursement
Payment and the Dividend Amount, in the form of a cash payment of
$30,489,662, by wire transfer of immediately available same day funds
in United States dollars to an account designated in writing by CAI;
and
(b) CAI shall deliver, or cause to be delivered pursuant to book entry at
DTC, to CFC 1,250,000 of the Shares and stock powers and certificate
for 100 of the Shares.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF CFC
CFC hereby represents and warrants to CAI and the Shareholders as follows:
2.1 Corporate Organization. CFC is a corporation duly organized, validly
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existing and in good standing under the laws of the State of Nebraska. CFC
has the corporate power and authority to own or lease all of its properties
and assets and to carry on its business as it is now being conducted and is
duly licensed or qualified to do business in each jurisdiction in which the
nature of the business conducted by it or the character or location of the
properties and assets owned or leased by it makes such licensing or
qualification necessary.
2.2 Authority; No Violation.
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(a) CFC has full corporate power and authority to execute and deliver this
Agreement and the other documents and instruments contemplated hereby
and to consummate the transactions contemplated hereby and thereby.
The execution and delivery by CFC of each of this Agreement and the
other documents and instruments contemplated hereby and the
consummation of the transactions contemplated hereby and thereby have
been duly and validly approved by the Board of Directors of CFC, and no
other corporate proceedings on the part of CFC are necessary to
consummate the transactions contemplated hereby and thereby. This
agreement has been, and upon execution and delivery thereof by CFC,
each of the other documents and instruments contemplated hereby will
be, duly and validly executed and delivered by CFC and (assuming due
authorization, execution and delivery by CAI) this Agreement
constitutes, and upon execution and delivery thereof by CFC, each of
the other documents and instruments contemplated hereby will
constitute, a valid and binding obligation of CFC enforceable against
CFC in accordance with its respective terms.
(b) Neither the execution and delivery of this Agreement or any other
document or instrument contemplated hereby by CFC nor the consummation
by CFC of the transactions contemplated hereby and thereby, nor
compliance by CFC with any of the terms or provisions hereof or
thereof, will (i) violate any provision of the Articles of
Incorporation, By-Laws or similar governing documents of CFC, or (ii)
(x) violate any statute, code, ordinance, rule, regulation, judgment,
order, writ, decree or injunction ("Law") applicable to CFC or any of
its properties or assets, or (y) violate, conflict with, result in a
breach of any provision of or the loss of any benefit under, constitute
a default (or an event which, with notice or lapse of time, or both,
would constitute a default) under, result in the termination of or a
right of termination or cancellation under, accelerate the performance
required by, or result in the creation of any Lien upon any of the
respective properties or assets of CFC under, any of the terms,
conditions or provisions of any note, bond, mortgage, indenture, deed
of trust, license, lease, agreement or other instrument or obligation
to which CFC is a party, or by which it or any of its properties or
assets may be bound or affected.
2.3 Consents and Approvals. No consents or approvals of, or filings
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registration with, any court, administrative agency or commission or other
governmental authority or instrumentality (each a "Governmental Authority")
or with any third party are necessary in connection with (a) the execution
and delivery of CFC of this Agreement and the other documents and
instruments contemplated hereby and (b) the consummation by CFC of the
transaction contemplated hereby and thereby.
2.4 Title to Warrant. CFC has, and upon the transfer of the Warrant to CAI in
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accordance with the terms hereof, CAI will have, good, valid and marketable
title to the Warrant (in whole and not in part), free and clear of any
liens, charges, encumbrances, pledges, options, trusts, voting trusts,
restrictions, members or shareholders' agreements, adverse rights or claims
and security interests whatsoever ("Liens"). Except for this Agreement,
CFC does not have and is not bound by any outstanding subscriptions,
options, warrants, calls, commitments or agreements of any character
calling for the purchase, issuance, transfer or assignment of the Warrant,
any interest in the Warrant or the shares of non-voting common stock of CAI
purchasable upon exercise of the Warrant. Without limiting the generality
of the foregoing, CFC is the Holder (as defined in the Warrant) of the
Warrant and there are no other Holders of the Warrant.
2.5 Status of Warrant.
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(a) CFC's election, pursuant to its letter, dated August 13, 1996, to
exercise the Warrant has been effectively and irrevocably rescinded and
withdrawn for all purposes prior to the effectiveness of such election,
pursuant to the letter, dated August 14, 1996, a true, correct and
complete copy of which is attached hereto as Exhibit A.
(b) Neither CFC nor any other Holder (including, without limitation any
prior Holder) has exercised, in whole or in part, the Warrant, and no
person or entity (other than CFC in its capacity as Holder) has the
right or power to exercise or cause the exercise of the Warrant.
Without limiting the generality of the foregoing, neither CFC nor any
of its Representatives (as defined herein) has taken any action which
has caused (or which, with notice or the passage of time, will cause)
any shares of common stock or other securities of CAI to become
issuable or to be deemed to have been issued or to have become issuable
pursuant to the Warrant for any reason.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF CAI
CAI hereby represents and warrants to CFC as follows:
3.1 Corporate Organization. CAI is a corporation duly organized, validly
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existing and in good standing under the laws of the State of Delaware. CAI
has the corporate power and authority to own or lease all of its properties
and assets and to carry on its business as it is now being conducted and is
duly licensed or qualified to do business in each jurisdiction in which the
nature of the business conducted by it or the character or location of the
properties and assets owned or leased by it makes such licensing or
qualifications necessary.
3.2 Authority; No Violation.
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(a) CAI has full corporate power and authority to execute and deliver this
Agreement and the other documents and instruments contemplated hereby
and to consummate the transactions contemplated hereby and thereby.
The execution and delivery by CAI of each of this Agreement and the
other documents and instruments contemplated hereby and the
consummation of the transactions contemplated hereby and thereby have
been duly and validly approved by the Board of Directors of CAI, and no
other corporate proceedings on the part of CAI are necessary to
consummate the transactions contemplated hereby and thereby. This
Agreement has been, and upon execution and delivery thereof by CAI,
each of the other documents and instrument contemplated hereby will be,
duly and validly executed and delivered by CAI and (assuming due
authorization, execution and delivery by CFC) this Agreement
constitutes, and upon execution and delivery thereof by CAI, each of
the documents and instruments contemplated hereby will constitute, a
valid and binding obligation of CAI enforceable against CAI in
accordance with its respective terms.
(b) Neither the execution and delivery of this Agreement or any other
document or instrument contemplated hereby by CAI nor the consummation
by CAI of the transactions contemplated hereby and thereby, nor
compliance by CAI with any of the terms or provisions hereof or
thereof, will (i) violate any provision of
the Certificate of Incorporation, By-laws or similar governing
documents of CAI, or (ii) (x) violate any Law applicable to CAI or any
of its properties or assets, or (y) violate, conflict with, result in a
breach of any provision of or the loss of any benefit under, constitute
a default (or an event which, with notice or lapse of time, or both,
would constitute a default) under, result in the termination of or a
right of termination or cancellation under, accelerate the performance
required by, or result in the creation of any Lien upon any of the
respective properties or assets of CAI under, any of the terms,
conditions or provisions of any note, bond, mortgage, indenture, deed
of trust, license, lease, agreementt or other instrument or obligation
to which CAI is a party, or by which it or any of its properties or
assets may be bound or affected.
3.3 Consents and Approvals. No consents or approvals of, or filings or
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registration with, any Governmental Authority or with any third party are
necessary in connection with (a) the execution and delivery by CAI of this
Agreement and the other documents and instruments contemplated hereby and
(b) the consummation by CAI of the transactions contemplated hereby and
thereby.
3.4 Ownership of Shares.
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(a) The Shares are the only shares of CFC Common Stock beneficially owned
by CAI.
(b) CAI has (except for a lien of Comerica Bank on the Shares, which lien
will be paid in full from the Cash Consideration, and upon the
transfer of the Shares to CFC in accordance with the terms hereof CFC
will have, good, valid and marketable title to the Shares, free and
clear of any Liens. CAI does not have and is not bound by any
outstanding subscriptions, options, warrants, calls, commitments or
agreements of any character calling for the purchase, issuance,
transfer or assignment of the Shares or any interest in the Shares
other than the Comerica Lien.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
OF THE SHAREHOLDERS
Each Shareholder hereby represents and warrants on his own behalf to CFC as
follows:
4.1 Execution and Delivery. This Agreement has been, and upon execution and
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delivery thereof by such Shareholder, each of the other documents and
instruments contemplated hereby will be, duly and validly executed and
delivered by such Shareholder and (assuming due authorization, execution
and delivery by CFC) this Agreement constitutes, and upon execution and
delivery thereof by such Shareholder, each of the other documents and
instruments contemplated hereby will constitute, a valid and binding
obligation of such Shareholder, enforceable against such Shareholder in
accordance with its respective terms.
4.2 Ownership of CFC Common Stock. Except for the Shares, such Shareholder
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does not beneficially own any shares of CFC Common Stock, other than, with
respect to Glackin and Ellis, shares of CFC Common Stock granted to such
Shareholder as part of his compensation as a director of CFC.
ARTICLE V
CERTAIN COVENANTS AND AGREEMENTS
5.1 Forbearances. None of CFC, CAI nor any Shareholder shall take any action
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that is intended or may reasonably be expected to result in any of it
representations and warranties set forth in this Agreement being or
becoming untrue in any material respect at any time prior to the Closing,
except, in every case, as required by Law.
5.2 No Exercise or Transfer of Warrant. CFC hereby agrees that from and after
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the date of this Agreement, it shall not (a) exercise, in whole or in part,
give any notice of exercise, in whole or in part, or permit or cause any
other person or entity to exercise or give any notice of exercise, in whole
or in part, of, the Warrant or (b) except as contemplated hereby, sell,
assign, convey or otherwise transfer (including, without limitation,
through merger
or consolidation or otherwise by operation of law), in whole or in part,
the Warrant or any interest therein, including, without limitation, any
right to acquire, hold or exercise the Warrant or any part thereof.
5.3 Standstill. CAI and each Shareholder hereby agrees that during the
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Standstill Period (as defined herein), it shall not, directly or
indirectly, (a) acquire, agree to acquire or make any proposal to acquire,
the securities of CFC or any of its subsidiaries, any warrant or option to
acquire any such securities, any security convertible into or exchangeable
for any such securities or any other right to acquire any such securities
(except, in the case of Glackin and Ellis, for securities of CFC or any of
its subsidiaries issued to such Shareholders as members of the Board of
Directors of CFC); (b) seek or propose any merger, consolidation, business
combination, tender or exchange offer, sale or purchase of assets or
securities, dissolution, liquidation, restructuring, recapitalization or
similar transaction of or involving CFC or any of its subsidiaries; and (c)
make, or in any way participate in, any "solicitation" of proxies or
consents within the meaning of Rule 14a-1 under the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), with respect to any securities of
CFC or any of its subsidiaries, or seek to advise or influence any person
with respect to the voting of any securities of CFC or any of its
subsidiaries or demand a copy of the stock ledger, list of stockholders or
any other books and records of CFC or any of its subsidiaries (except in
connection with the enforcement of any claim of CAI or any such Shareholder
under this Agreement); (d) form, join or in any way participate in a
"group" (within the meaning of Section 13(d)(3) of the Exchange Act), with
respect to any securities of CFC or any of its subsidiaries; e) otherwise
act, alone or in concert with others, to seek to control or influence, in
any manner, the management, Board of Directors or policies of CFC or any of
its subsidiaries; (f) have any discussions or enter into any arrangements,
understandings or agreements (whether written or oral) with, or advise,
finance, assist or encourage, any other persons in connection with any of
the foregoing; or make any other investment in any other person that
engages, or offers or proposes to engage, in any of the foregoing;
provided, however, nothing contained herein shall be deemed to prohibit CAI
or any Shareholder from acquiring any publicly-traded security (other than
any security of CFC or any of its subsidiaries); provided, further, that if
the issuer (or any Affiliate thereof) of such publicly-traded security is
engaged in any activity otherwise prohibited under this Section 5.5,
neither CAI nor any of the Shareholders shall acquire a controlling
interest in such issuer or otherwise actively participate in the business
activities of such issuer. CAI and each Shareholder also agrees during
such period not to make any proposal, statement or inquiry, or disclose any
intention, plan or arrangement (whether written or oral) inconsistent with
the foregoing, or request CFC, directly or indirectly, to amend, waive or
terminate any provision of this Section 5.3 (including this sentence).
Notwithstanding anything in this Agreement to the contrary, no restriction
or prohibition set forth in this Section 5.3 shall apply to either of
Glackin or Ellis in his capacity as a director of CFC or any of its
subsidiaries. For purposes of this Agreement, the "Standstill Period"
shall mean the period of 60 months beginning on the date of this Agreement.
5.4 Indemnification. CFC hereby agrees to indemnify, defend and hold harmless
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CAI and each director, officer and Affiliate (as defined herein) of CAI,
including, without limitation, the Shareholders (collectively, the "CAI
Group"), from and against all reasonable fees and expenses of counsel
incurred by any member of the CAI Group in connection with the defense of
any litigation brought against any member of the CAI Group by or on behalf
of any shareholder of CFC challenging the validity of this Agreement or the
transactions contemplated hereby; provided, that the CAI Group shall
reasonably cooperate with CFC in the defense or settlement of any such
litigation. The indemnification provided hereunder is not intended to
apply to the conduct of any member of the CAI Group outside the scope of
this Agreement or the transactions contemplated hereby. Nothing contained
herein shall be deemed a waiver of any right of indemnification otherwise
available to any member of the CAI Group.
5.5 Waiver and Release.
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(a) CFC, on behalf of itself and its Representatives (as defined herein),
for good and sufficient consideration, the receipt and adequacy of
which are hereby acknowledged, hereby waives, releases and forever
discharges CAI and each Shareholder, and their respective
Representatives, from each and every class, individual, or derivative
claim, of any kind, known or unknown, from the beginning of the world
to the Closing, which CFC or its Representatives had, now have, or may
hereafter have, in any capacity, against CAI, the Shareholders and
their respective Representatives, or any of them, except for claims
arising out of this Agreement. For purposes of this Agreement,
"Representatives" shall mean, with respect to a particular party, its
officers, directors, employees, shareholders, Affiliates (as such term
is defined in Rule 12b-2 under the Exchange Act), and their respective
heirs, executors, successors, and administrators.
(b) CAI and each Shareholder, on behalf of itself and its respective
Representatives, for good and sufficient consideration, the receipt and
adequacy of which are hereby acknowledged, hereby waives, releases and
forever discharges CFC and its Representatives, from each and every
class, individuals, or derivative claim, of any kind, known or unknown,
from the beginning of the world to the Closing, which CAI, any
Shareholder, or any of their respective Representatives had, now have,
or may hereafter have, in any capacity, against CFC and its
Representatives, or any of them, except for claims arising out of this
Agreement, the Note or the Security Agreement.
5.6 Public Announcements. Promptly following execution of this Agreement, CFC
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shall issue a press release in the form attached hereto as Exhibit B. CFC
shall not, and for so long as CFC shall be in compliance with all of its
obligations under the Note and the Security Agreement, neither CAI nor any
Shareholder shall, (i) make any public statement that is contrary to such
press release or (ii) make any public or private statement or issue any
press release concerning the subject matter hereof which contains
derogatory information or statements regarding the other parties hereto or
their Representatives.
5.7 Resignations. At or prior to payment in full of the Note by CFC, each of
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Ellis and Glackin shall deliver to CFC a duly executed letter of
resignation from the Board of Directors of CFC, substantially in the form
of Exhibit C attached hereto.
ARTICLE VI
MISCELLANEOUS
6.1 Survival of Representations, Warranties and Agreements. Each of the
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representations, warranties, covenants and agreements of the parties
contained herein shall survive the Closing indefinitely.
6.2 Expenses. Except as otherwise provided in this Agreement, all costs and
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expenses incurred in connection with this Agreement and the transactions
contemplated hereby shall be paid by the party incurring such expense.
6.3 Notices. All notices and communications required or permitted hereunder
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shall be in writing, and effective upon receipt, if delivered in person,
sent by certified or registered mail (postage prepaid), sent by a
nationally recognized overnight courier or sent by means of facsimile with
telephone confirmation or receipt as follows (or at such other address or
telecopy number for a party as shall be specified by like notice):
To CFC: Commercial Federal Corporation
P.O. Box 1103
2120 South 72nd Street
Omaha, Nebraska 68101
Attention: William A. Fitzgerald
Telephone: (402) 554-9200
Telecopy: (402) 390-5256
To the CAI Corporation
Shareholders 12770 Coit Road, Suite 902
and CAI: Dallas, Texas 75251
Attention: Robin R. Glackin
Telephone: (214) 991-7716
Telecopy: (214) 991-8922
6.4 Modifications; Waivers. The provisions of this Agreement may only be
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modified by written agreement duly executed by all parties hereto. No
waiver of any provision of this Agreement shall be binding unless executed
in writing by granting the waiver. No waiver of any provision of this
Agreement shall be deemed or shall constitute a waiver of any other
provision, whether or not similar, nor shall any waiver constitute a
continuing waiver.
6.5 Headings. Captions and headings appearing in this Agreement are for ease
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of reference only and do not constitute a part of this Agreement.
6.6 GOVERNING LAW. THIS AGREEMENT AND ALL QUESTIONS CONCERNING ITS VALIDITY,
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CONSTRUCTION OR PERFORMANCE SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT REGARD TO THE
CONFLICTS OF LAWS PRINCIPLES THEREOF.
6.7 Counterparts. This Agreement may be executed in more than one counterpart,
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each of which shall be deemed to be an original, but all of which together
shall constitute one and the same document.
6.8 Assignment; Successors and Assigns. This Agreement may not be assigned by
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any party hereto without the prior written consent of CAI, on behalf of
itself and the Shareholders, in the case of any assignment by CFC, and CFC,
in the case of an assignment by CAI or any Shareholder. This Agreement
shall inure to the benefit of, be binding upon, and be enforceable by and
against the parties and their respective successors and permitted assigns.
6.9 Entire Agreement. This Agreement constitutes the entire agreement and
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supersedes all prior agreements and understandings, both written and oral,
among or between the parties with respect to the subject matter hereof.
IN WITNESS WHEREOF, the parties have executed this Agreement or caused this
Agreement to be executed and delivered by their respective officers or
representatives thereunto duly authorized, in each case, as of the date first
indicated above.
COMMERCIAL FEDERAL CORPORATION CAI CORPORATION
By: /s/William A. Fitzgerald By: /s/ Steven M. Ellis
William A. Fitzgerald Steven M. Ellis
Chairman of the Board and Senior Vice President
Chief Executive Officer
/s/ Robin R. Glackin
Robin R. Glackin
/s/ Steven M. Ellis
Steven M. Ellis
/s/ Byron A. Lax
Byron A. Lax