Execution Copy
Exhibit 99.2
SHAREHOLDERS AGREEMENT
SHAREHOLDERS AGREEMENT dated as of November 7, 2002 (the "Agreement"),
by and between Xxxxxxxxxx Corporation, a Vermont corporation ("Buyer"), the
undersigned directors and/or officers (each a "Shareholder" and collectively,
the "Shareholders") of Granite State Bankshares, Inc., a New Hampshire
corporation (the "Company"). Capitalized terms used herein and not defined
herein have the respective meanings set forth in the Merger Agreement (as
defined below).
WHEREAS, Buyer and the Company have entered into an Agreement and Plan
of Merger, dated as of November 7, 2002, as such agreement may be subsequently
amended or modified (the "Merger Agreement"), providing for the merger of the
Company with and into the Buyer (the "Merger");
WHEREAS, as of the date hereof, each Shareholder beneficially owns (as
defined in Rule 13d-3 under the Securities Exchange Act of 1934, as amended) and
has sole or shared voting power with respect to (a) the number of shares of
common stock, par value $1.00 per share (the "Common Stock"), of the Company
(the "Existing Shares" and together with any other shares of Common Stock which
such Shareholder acquires beneficial ownership in any capacity after the date
hereof and prior to the termination of this Agreement, the "Shares"), and (b)
holds stock options or other rights to acquire the number of shares of Common
Stock, each as set forth opposite such Shareholder's name on Schedule I attached
hereto;
WHEREAS, as a condition to the willingness of Buyer to enter into the
Merger Agreement, Parent has required that each Shareholder enter into this
Agreement with respect to such Shares; and
WHEREAS, the Shareholders intend this Agreement to be a voting
agreement authorized under Section 293-A:7:31 of the New Hampshire Business
Corporation Act.
NOW, THEREFORE, in consideration of, and as a condition to, Buyer's
entering into the Merger Agreement, and in consideration of the expenses
incurred and to be incurred by Buyer in connection therewith, the parties hereto
agree as follows:
1. Agreement to Vote. While this Agreement is in effect, such Shareholder agrees
to vote or cause to be voted all Shares that such Shareholder shall be entitled
to so vote, whether such Shares are held of record or beneficially owned by such
Shareholder at the special meeting of the Company's shareholders to be called
and held following the date hereof (including any adjournment or postponement
thereof, the "Company Meeting") or at any other meeting of the Company's
shareholders, and in connection with every action or approval by written consent
of the Company, (a) in favor of the approval of the Merger Agreement, the Merger
and the other transactions contemplated by the Merger Agreement and (b) against
any Acquisition Proposal other than the Merger.
2. Irrevocable Proxy. In furtherance and not in limitation of the foregoing,
each Shareholder hereby grants to, and appoints, until the date of the
termination of this Agreement, Buyer and each of Xxxx X. Xxxxxxx and F. Xxxxxxx
Xxxxxxxx in their respective capacities as officers of Buyer, and any individual
who shall thereafter succeed any such officer of Buyer, and any other designee
of Buyer, each of them individually, its irrevocable proxy and attorney-in-fact
(with full power of substitution) to vote each of such Shares as such
Shareholder's proxy as indicated in Section 1 at the Company Meeting and at
every such meeting of the Company (including adjournment or postponement
thereof) or in connection with any written consent of the Company's
Shareholders. Each Shareholder intends this proxy to be irrevocable and coupled
with an interest and will take such further action and execute such other
instruments as may be necessary to effectuate the intent of this proxy.
3. Agreement to Retain Shares. While this Agreement is in effect, other than as
provided herein, each Shareholder agrees that he or she will not sell, assign,
transfer or otherwise dispose of (including, without limitation, by the creation
of a Lien (as defined in Section 6 below)), or permit to be sold, assigned,
transferred or otherwise disposed of, any Shares beneficially owned by such
Shareholder, except (a) transfers by will or by operation of law, in which case
this Agreement shall bind the transferee, (b) transfers pursuant to any pledge
agreement, subject to the pledgee agreeing in writing to be bound by the terms
of this Agreement, (c) transfers in connection with estate and tax planning
purposes, including transfers to relatives, trusts and charitable organizations,
subject to the transferee agreeing in writing to be bound by the terms of this
Agreement, (d) transfers to any other Shareholder of the Company who has
executed a copy of this Agreement on the date hereof with respect the Shares
held by such Shareholder, and (e) as Buyer may otherwise agree in its sole
discretion.
4. Legend. The Company shall cause its transfer agent to note on its records for
the Company (in whatever form maintained) that such Shares are subject to the
restrictions on voting and transfer set forth herein, and at Buyer's request
shall have any existing certificates representing Shares subject to this
Agreement canceled and reissued bearing the following legend:
"THIS CERTIFICATE AND THE SHARES REPRESENTED HEREBY ARE SUBJECT TO
CERTAIN VOTING AND TRANSFER RESTRICTIONS CONTAINED IN A SHAREHOLDERS
AGREEMENT BY AND BETWEEN XXXXXXXXXX CORPORATION AND CERTAIN BENEFICIAL
OWNERS OF GRANITE STATE BANKSHARES, INC. AND THESE SHARES MAY BE SOLD,
ASSIGNED, TRANSFERRED, OR OTHERWISE DISPOSED OF ONLY IN COMPLIANCE
THEREWITH. COPIES OF THE ABOVE-REFERENCED AGREEMENT ARE ON FILE AT THE
OFFICES OF GRANITE STATE BANKSHARES, INC."
5. No Exercise of Options. Such Stockholder hereby agrees that between the date
hereof and the Effective Time, he or she shall not exercise any stock options
owned by him or her to purchase shares of Common Stock; provided, however, that
such Stockholder may exercise any such stock options that are subject to an
exercise period that expires prior to the Effective Time or in accordance with
the Merger Agreement.
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6. Representations and Warranties of Shareholder. Each Shareholder, severally
and not jointly, hereby represents and warrants to Parent as follows:
(a) Such Shareholder has the complete and unrestricted power and the
unqualified right to enter into and perform the terms of this Agreement.
This Agreement has been duly and validly executed and delivered by such
Shareholder and constitutes a legal, valid and binding agreement with
respect to such Shareholder, enforceable against such Shareholder in
accordance with its terms, except to the extent enforcement may be limited
by general principles of equity whether applied in a court of law or a
court of equity and by bankruptcy, insolvency, moratorium and other similar
laws affecting creditors' rights and remedies generally.
(b) Such Shareholder (i) beneficially owns the number of Shares indicated
opposite such Shareholder's name on Schedule I, hereto, free and clear of
any liens, claims, charges or other encumbrances or restrictions of any
kind whatsoever ("Liens"), and has sole, and otherwise unrestricted, voting
power with respect to such Shares with no limitations, qualifications or
restrictions on such rights and (ii) does not beneficially own any shares
of capital stock of the Company other than such Shares.
(c) There are no proxies, voting trusts or understandings to or by which
such Shareholder is a party or bound or that expressly requires that any of
the Shares be voted in a specific manner other than as provided in this
Agreement or that provides for any right on the part of any other person
other than such Shareholder to vote such Shares.
7. Term of Agreement. The Agreement with respect to voting contained in Section
1 hereof shall remain in full force and effect until the earlier of (a) the
consummation of the Merger or (b) the termination of the Merger Agreement in
accordance with Article VIII thereof and the agreement with respect to transfer
contained in Section 3 hereof shall remain in full force and effect until the
earlier of (i) the Company Meeting or (ii) the termination of the Merger
Agreement in accordance with Article VIII thereof.
8. Specific Performance; Injunctive Relief. Such Shareholder has signed this
Agreement intending to be bound thereby. Such Shareholder expressly agrees that
this Agreement shall be specifically enforceable in any court of competent
jurisdiction in accordance with its terms against such Shareholder. All of the
covenants and agreements contained in this Agreement shall be binding upon, and
inure to the benefit of, the respective parties and their permitted successors,
assigns, heirs, executors, administrators and other legal representatives, as
the case may be.
9. Waivers. No waivers of any breach of this Agreement extended by Buyer to any
Shareholder shall be construed as a waiver of any rights or remedies of Buyer
with respect to any other Shareholder of the Company who has executed a copy of
this Agreement with respect to Shares held by such Shareholder or with respect
to any subsequent breach of the Shareholder or any other such Shareholder of the
Company.
10. Amendments and Modifications. This Agreement may not be modified, amended,
altered or supplemented except upon the execution and delivery of a written
agreement executed by the parties hereto.
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11. Governing Law. This Agreement is deemed to be signed as a sealed instrument
and is to be governed by the laws of the State of New Hampshire, without giving
effect to the principles of conflicts of laws thereof. If any provision hereof
is deemed unenforceable, the enforceability of the other provisions hereof shall
not be affected.
12. Counterparts. This Agreement may be executed in one or more counterparts,
each of which will be deemed an original but all of which together shall
constitute one and the same instrument.
[Signature Page Follows]
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EXECUTED as of the date first above written.
BUYER: SHAREHOLDER:
XXXXXXXXXX CORPORATION
By: /s/ F. Xxxxxxx Xxxxxxxx /s/ Xxxxxx X. Xxxxxxx
------------------------------------------- -----------------------------
Name: F. Xxxxxxx Xxxxxxxx Xxxxxx X. Xxxxxxx
Title: Senior Vice President, General
Counsel and Corporate Secretary /s/ Xxxxxx X. Xxxx
-----------------------------
Xxxxxx X. Xxxx
/s/ Xxxxx X. Xxxxxxx
-----------------------------
Xxxxx X. Xxxxxxx
/s/ Xxxxx X. Xxxxxx
-----------------------------
Xxxxx X. Xxxxxx
-----------------------------
Xx. Xxxxx X. Xxxxxxx
/s/ Xxxxx X. Read
-----------------------------
Xxxxx X. Read
/s/ Xxxxxxx X. Xxxxx
-----------------------------
Xxxxxxx X. Xxxxx
/s/ Xxxxx X. Xxxxxx, III
-----------------------------
Xxxxx X. Xxxxxx, III
/s/ E. Story Xxxxxx
-----------------------------
E. Story Xxxxxx
/s/ Xxxxxxx X. Xxxxxx
-----------------------------
Xxxxxxx X. Xxxxxx
/s/ Xxxxxxx X. Xxxxxxxx
-----------------------------
Xxxxxxx X. Xxxxxxxx
/s/ Xxxxxxx X. Xxxx
-----------------------------
Xxxxxxx X. Xxxx
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SCHEDULE I(1)
Stockholder Shares Options
----------- ------ -------
Xxxxxx X. Xxxxxxx 63,318(2) (includes 12,735 11,000
shares which Xx.
Xxxxxxx is Trustee)
Xxxxxx X. Xxxx 7,360(2) 7,625
Xxxxx X. Xxxxxxx 32,358(2) 400
Xxxxx X. Xxxxxx 9,273(2) 11,000
Xx. Xxxxx X. Xxxxxxx 3,656(2) 11,000
Xxxxx X. Read 8,865(2) 11,801
Xxxxxxx X. Xxxxx 180,603(2) 103,000
Xxxxx X. Xxxxxx, III 26,690(2) 11,000
E. Story Xxxxxx 9,730(2) 7,625
Xxxxxxx X. Xxxxxx 68,770(3) 51,500
Xxxxxxx X. Xxxxxxxx 117,844(3) (includes 4,587 51,500
shares held as
trustee for Xxxxx
X. Xxxxx Trust)
Xxxxxxx X. Xxxx 64,514(3) 51,500
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1 Shares include shares allocable to a Shareholder's account under the Company's
employee stock ownership, deferred investment or other similar plans.
2 Does not include dividend reinvestment plan shares that have not yet been
reported on an SEC Form 4.
3 Shares do not include the most recent ESOP distributions/allocations.
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