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EXHIBIT 99.1
STOCK OPTION AGREEMENT
This STOCK OPTION AGREEMENT (the "AGREEMENT") is made and entered into as
of October 6, 1999, between Rock Financial Corporation, a Michigan corporation
("COMPANY"), and Intuit Inc., a Delaware corporation ("PARENT"). Capitalized
terms used in this Agreement but not defined herein shall have the meanings
ascribed to such terms in the Merger Agreement (as defined below).
R E C I T A L S
A. Concurrently with the execution and delivery of this Agreement,
Company, Parent, Title Source, Inc., a Michigan corporation, Merger Sub 1, Inc.,
a Michigan corporation and a wholly owned subsidiary of Parent ("MERGER SUB 1")
and Merger Sub 2, Inc., a Michigan corporation and a wholly owned subsidiary of
Parent ("MERGER SUB 2"), are entering into an Agreement and Plan of Merger (the
"MERGER AGREEMENT"), that provides, among other things, upon the terms and
subject to the conditions thereof, for Company and Parent to enter into a
business combination transaction (the "COMPANY MERGER").
B. As a condition to Parent's willingness to enter into the Merger
Agreement, Parent has required that Company agree, and Company has so agreed, to
grant to Parent an option to acquire shares of Company Common Stock ("COMPANY
SHARES"), upon the terms and subject to the conditions set forth herein.
In consideration of the foregoing and of the mutual covenants and
agreements set forth herein and in the Merger Agreement and for other good and
valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the parties agree as follows:
1. Grant of Option. Company hereby grants to Parent an irrevocable option
(the "OPTION"), exercisable following the occurrence of an Exercise Event (as
defined in Section 2(a)), to acquire up to a number of Company Shares equal to
19.9% of the shares of Company Common Stock issued and outstanding as of the
date, if any, upon which an Exercise Notice (as defined in Section 2(b) below)
shall have been delivered (the "OPTION SHARES"), in the manner set forth below
by paying cash at a price of $23.00 per share (the "EXERCISE PRICE").
2. Exercise of Option
(a) For all purposes of this Agreement, an "EXERCISE EVENT" shall mean
the occurrence of any of (i) a Triggering Event (as such term is defined in the
Merger Agreement), (ii) the public announcement of an Option Acquisition
Proposal (as defined below), (iii) the acquisition by any person (other than
Parent, Merger Sub 1, Merger Sub 2 or any of their affiliates) or "group" (as
defined under Section 13(d) of the Exchange Act and the rules and regulations
thereunder) of beneficial ownership of 20% or more of the total outstanding
voting
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securities of the Company or any of its subsidiaries(provided, however, that no
exercise by a shareholder of the Company as of the date of this Agreement of any
Company Options that are outstanding and held by such shareholder as of the date
of this Agreement shall be deemed to cause a person to be the beneficial owner
of such interest of more than 20%), (iv) Company's failure to take all actions
necessary to hold the Company Shareholders' Meeting as promptly as practicable,
and in any event (to the extent permissible under applicable law) within 45 days
after the declaration of effectiveness of the Registration Statement, (v) the
termination of the Merger Agreement pursuant to (i) any of Section 8.1(f),
Section 8.1(g), or Section 8.1(h) thereof or (ii) pursuant to Section 8.1(k)
thereof to the extent that such termination arises from a willful breach of a
representation, warranty or covenant, or (vi) the commencement of a solicitation
within the meaning of Rule 14a-1(l) by any person or entity other than Company
or its Board of Directors (or any person or entity acting on behalf of Company
or its Board of Directors) seeking to alter the composition of Company's Board
of Directors.
For purposes of this Agreement, "OPTION ACQUISITION PROPOSAL" shall
mean any offer or proposal (other than an offer or proposal by Parent, Merger
Sub 1, Merger Sub 2 or their affiliates) relating to any transaction or series
of related transactions involving: (A) any purchase from the Company or
acquisition by any person or "group" (as defined under Section 13(d) of the
Exchange Act and the rules and regulations thereunder) of more than a 20%
interest in the total outstanding voting securities of the Company or any of its
subsidiaries, or any tender offer or exchange offer that if consummated would
result in any person or "group" (as defined under Section 13(d) of the Exchange
Act and the rules and regulations thereunder) beneficially owning 20% or more of
the total outstanding voting securities of the Company or any of its
subsidiaries, or any merger, consolidation, statutory share exchange, business
combination or similar transaction involving the Company (provided, however,
that none of the foregoing transactions or series of related transactions
described in this clause (A) shall be deemed to occur solely by virtue of the
exercise by any person who is a shareholder of the Company as of the date of
this Agreement of any Company Options that are outstanding and held by such
shareholder as of the date of this Agreement); (B) any sale, lease (other than
in the ordinary course of business), exchange, transfer, license (other than in
the ordinary course of business), acquisition or disposition of more than 20% of
the assets of the Company; or (C) any liquidation or dissolution of the Company.
(b) Parent may deliver to Company a written notice (an "EXERCISE
NOTICE") specifying that it wishes to exercise and close a purchase of Option
Shares at any time following the occurrence of an Exercise Event and specifying
the total number of Option Shares it wishes to acquire. The closing of a
purchase of Option Shares (a "CLOSING") specified in such Exercise Notice shall
take place at the principal offices of Company upon such business day as may be
designated by Parent therein, but no later than the later of (1) five business
days after such Exercise Notice is delivered in accordance with the terms
hereof, and (2) one business day after the conditions of closing are satisfied
or waived.
(c) The Option shall terminate upon the earliest to occur of (i) the
Effective Time (as such term is defined in the Merger Agreement), (ii)
termination of the Merger Agreement pursuant to either Section 8.1(a) or 8.1(i)
thereof, (iii) termination of the Merger
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Agreement pursuant to Section 8.1(b) or 8.1(d) thereof if prior thereto no
Exercise Event shall have occurred, or (iv) 12 months following the termination
of the Merger Agreement under any other circumstances; provided, however, that
if the Option is exercisable but cannot be exercised by reason of any applicable
government order or because the waiting period related to the issuance of the
Option Shares under the HSR Act shall not have expired or been terminated, or
because any other condition to closing has not been satisfied, then the Option
shall not terminate until the tenth business day after such impediment to
exercise shall have been removed or shall have become final and not subject to
appeal.
(d) If Parent receives proceeds in connection with any sales or other
dispositions of Option Shares or the Option (including by surrendering the
option pursuant to Section 9 hereof), plus any dividends (or equivalent
distributions under Section 8(a) hereof) received by Parent declared on Option
Shares, then, to the extent that the sum of (i) such proceeds, plus (ii) the sum
of (a) any Termination Fee, plus (b) any Additional Fee, exceeds the sum of (1)
Eighteen Million Five Hundred Thousand Dollars ($18,500,000) plus (2) the
Exercise Price multiplied by the number of Company Shares purchased by Parent
pursuant to the Option, then all proceeds to Parent in excess of such sum shall
be promptly remitted in cash by Parent to Company.
3. Conditions to Closing. The obligation of Company to issue Option
Shares to Parent hereunder is subject to the conditions that (a) any waiting
period under the HSR Act applicable to the issuance of the Option Shares
hereunder shall have expired or been terminated, (b) all material consents,
approvals, orders or authorizations of, or registrations, declarations or
filings with, any Governmental Entity, if any, required in connection with the
issuance of the Option Shares hereunder shall have been obtained or made, as the
case may be, and (c) no preliminary or permanent injunction or other order by
any court of competent jurisdiction prohibiting or otherwise restraining such
issuance shall be in effect. It is understood and agreed that upon delivery to
Company of an Exercise Notice, the parties will use their respective reasonable
efforts to satisfy all conditions to Closing so that a Closing may take place as
promptly as practicable.
4. Closing. At any Closing, (a) Company shall deliver to Parent a
single certificate in definitive form representing the number of Company Shares
designated by Parent in its Exercise Notice consistent with this Agreement, such
certificate to be registered in the name of Parent and to bear the legend set
forth in Section 9 hereof, against delivery of (b) payment by Parent to Company
of the aggregate Exercise Price for the Company Shares so designated and being
purchased by delivery of a certified check, bank check or wire transfer of
immediately available funds.
5. Representations and Warranties of the Company. Company represents
and warrants to Parent that: (a) Company is a corporation duly organized,
validly existing and in good standing under the laws of the State of Michigan
and has the corporate power and authority to enter into this Agreement and to
carry out its obligations hereunder; (b) the execution and delivery of this
Agreement by Company and consummation by Company of the transactions
contemplated hereby have been duly authorized by all necessary corporate action
on the part of
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Company and no other corporate proceedings on the part of Company are necessary
to authorize this Agreement or any of the transactions contemplated hereby; (c)
this Agreement has been duly executed and delivered by Company and, assuming the
due execution and delivery thereof by Parent, constitutes a legal, valid and
binding obligation of Company and, assuming this Agreement constitutes a legal,
valid and binding obligation of Parent, is enforceable against Company in
accordance with its terms, except as enforceability may be limited by bankruptcy
and other similar laws affecting the rights of creditors generally and general
principles of equity; (d) except for any filings, authorizations, approvals or
orders required under the HSR Act, Company has taken all necessary corporate and
other action to authorize and reserve for issuance and to permit it to issue
upon exercise of the Option, and at all times from the date hereof until the
termination of the Option will have reserved for issuance, a sufficient number
of unissued Company Shares for Parent to exercise the Option in full and will
take all necessary corporate or other action to authorize and reserve for
issuance all additional Company Shares or other securities which may be issuable
pursuant to Section 7(a) upon exercise of the Option, all of which, upon their
issuance and delivery in accordance with the terms of this Agreement and payment
therefor by Parent, will be validly issued, fully paid and nonassessable; (e)
upon delivery of the Company Shares and any other securities to Parent upon
exercise of the Option, Parent will acquire such Company Shares or other
securities free and clear of all claims, liens, charges, encumbrances and
security interests of any kind or nature whatsoever; (f) the execution and
delivery of this Agreement by Company do not, and the performance of this
Agreement by the Company will not, (i) conflict with or violate the Articles of
Incorporation or Bylaws of the Company, (ii) conflict with or violate any law,
rule, regulation, order, judgment or decree applicable to the Company or any of
its subsidiaries or by which they or any of their respective properties is bound
or affected or (iii) except to the extent it will not interfere with or prevent
Company in any way from performing all of its obligations hereunder, result in
any material breach of or constitute a material default (or an event that with
notice or lapse of time or both would become a material default) under, or
impair Company's rights or alter the rights or obligations of any third party
under, or give to others any rights of termination, amendment, acceleration or
cancellation of, or result in the creation of a material Encumbrance on any of
the material properties or assets of Company or any of its subsidiaries pursuant
to, any note, bond, mortgage, indenture, contract, agreement, lease, license,
permit, franchise, concession, or other instrument or obligation to which
Company or any of its subsidiaries is a party or by which Company or any of its
subsidiaries or its or any of their respective assets are bound or affected; and
(g) the execution and delivery of this Agreement by Company does not, and the
performance of this Agreement by Company will not, require any consent,
approval, authorization or permit of, or filing with, or notification to, any
Governmental Entity, except pursuant to the HSR Act.
6. Registration Rights
(a) Following the occurrence of an Exercise Event, Parent (sometimes
referred to herein as the "HOLDER") may by written notice (a "REGISTRATION
NOTICE") to Company (the "REGISTRANT") request the Registrant to register under
the Securities Act all or any part of the shares acquired by the Holder pursuant
to this Agreement (such shares requested to be registered the "REGISTRABLE
SECURITIES") in order to permit the sale or other disposition of such shares;
provided, however, that any such Registration Notice must relate to a number of
shares equal to
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at least 2% of the outstanding shares of Common Stock of the Registrant and that
any rights to require registration hereunder shall terminate with respect to any
shares that may be sold pursuant to Rule 144(k) under the Securities Act or at
such time as all of the Registrable Securities may be sold in any three month
period pursuant to Rule 144 under the Securities Act. Upon receipt of a
Registration Notice, the Registrant shall use all reasonable efforts to effect,
as promptly as practicable, the registration under the Securities Act of the
Registrable Securities requested to be registered in the Registration Notice;
provided, however, that (i) the Holder shall not be entitled to more than an
aggregate of two effective registration statements hereunder (provided that if
the Registrant withdraws a filed registration statement at the request of the
Holder (other than as the result of a material change in the Registrant's
business or the Holder's learning of new material information concerning the
Registrant), then such filing shall be deemed to have been an effective
registration for purposes of this clause (i)), and (ii) the Registrant will not
be required to maintain the effectiveness of any such registration statement for
a period greater than 90 days. If consummation of the sale of any Registrable
Securities pursuant to a registration hereunder does not occur within 180 days
after the filing with the SEC of the initial registration statement therefor,
the provisions of this Section 6 shall again be applicable to any proposed
registration. The Registrant shall use all reasonable efforts to cause any
Registrable Securities registered pursuant to this Section 6 to be qualified for
sale under the securities or blue sky laws of such jurisdictions as the Holder
may reasonably request and shall continue such registration or qualification in
effect in such jurisdictions until the Holder has sold or otherwise disposed of
all of the securities subject to the registration statement; provided, however,
that the Registrant shall not be required to qualify to do business in, or
consent to general service of process in, any jurisdiction by reason of this
provision. In the event that, following the occurrence of an Exercise Event,
Company enters into (with the approval of Company's Board of Directors) any bona
fide, definitive agreement with any third party (a "TRANSACTION AGREEMENT")
providing for the consummation of any transaction (a "TRANSACTION"), and such
Transaction Agreement provides, upon the consummation of the Transaction, for
the registration of the Option Shares then outstanding (or issuable upon a
subsequent exercise of the Option) or for issuance of other securities in
exchange for such Option or Option Shares that may, promptly after the
consummation of the Transaction (or the exercise of this Option after such
consummation to the extent that the Option is exercised after such consummation)
be freely resold by Parent without any restrictions under applicable state or
U.S. federal securities laws (including without limitation volume of sale
restrictions or other limitations imposed by Rule 144 or Rule 145 under the
Securities Act), then during the period beginning on the date that the Company
enters into such a Transaction Agreement and ending on the earlier of (a) the
date that such Transaction Agreement is terminated and (b) the one hundred and
twentieth (120th) day following the date on which the Company enters into such a
Transaction Agreement, the Company may elect, upon written notice to Parent
delivered at any time during such period, not to proceed with the registration
of any Registrable Securities under this Section 6(a); provided, however, that
the Company may only make one such election.
(b) The registration rights set forth in this Section 6 are subject to
the condition that the Holder shall provide the Registrant with such information
with respect to the Holder's Registrable Securities, the plan for distribution
thereof, and such other information with respect to the Holder as, in the
reasonable judgment of counsel for the Registrant, is necessary to
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enable the Registrant to include in a registration statement all material facts
required to be disclosed with respect to a registration thereunder, including
the identity of the Holder and the Holder's plan of distribution.
(c) A registration effected under this Section 6 shall be effected at
the Registrant's expense, except for underwriting discounts and commissions and
the fees and expenses of counsel to the Holder, and the Registrant shall use all
reasonable efforts to provide to the underwriters such documentation (including
certificates, opinions of counsel and "comfort" letters from auditors) as are
customary in connection with underwritten public offerings and as such
underwriters may reasonably require. In connection with any registration, the
Holder and the Registrant agree to enter into an underwriting agreement
reasonably acceptable to each such party, in form and substance customary for
transactions of this type with the underwriters participating in such offering.
(d) Indemnification
(i) The Registrant will indemnify the Holder, each of its
directors and officers and each person who controls the Holder within the
meaning of Section 15 of the Securities Act, and each underwriter of the
Registrant's securities, with respect to any registration, qualification or
compliance which has been effected pursuant to this Agreement, against all
expenses, claims, losses, damages or liabilities (or actions in respect
thereof), including any of the foregoing incurred in settlement of any
litigation, commenced or threatened, arising out of or based on any untrue
statement (or alleged untrue statement) of a material fact contained in any
registration statement, prospectus, offering circular or other document, or any
amendment or supplement thereto, incident to any such registration,
qualification or compliance, or based on any omission (or alleged omission) to
state therein a material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances in which they were made,
not misleading, or any violation by the Registrant of any rule or regulation
promulgated under the Securities Act applicable to the Registrant in connection
with any such registration, qualification or compliance, and the Registrant will
reimburse the Holder and, each of its directors and officers and each person who
controls the Holder within the meaning of Section 15 of the Securities Act, and
each underwriter for any legal and any other expenses reasonably incurred in
connection with investigating, preparing or defending any such claim, loss,
damage, liability or action, provided that the Registrant will not be liable in
any such case to the extent that any such claim, loss, damage, liability or
expense arises out of or is based on any untrue statement or omission or alleged
untrue statement or omission, made in reliance upon and in conformity with
written information furnished to the Registrant by the Holder or director or
officer or controlling person or underwriter seeking indemnification, provided,
however, that the indemnity agreement contained in this subsection 6(e)(i) shall
not apply to amounts paid in settlement of any such loss, claim, damage,
liability or action if such settlement is effected without the consent of the
Registrant, which consent shall not be unreasonably withheld.
(ii) The Holder will indemnify the Registrant, each of its
directors and
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officers and each underwriter of the Registrant's securities covered by such
registration statement and each person who controls the Registrant within the
meaning of Section 15 of the Securities Act, against all claims, losses, damages
and liabilities (or actions in respect thereof), including any of the foregoing
incurred in settlement of any litigation, commenced or threatened, arising out
of or based on any untrue statement (or alleged untrue statement) of a material
fact contained in any such registration statement, prospectus, offering circular
or other document, or any omission (or alleged omission) to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, or any violation by the Holder of any rule or regulation
promulgated under the Securities Act applicable to the Holder in connection with
any such registration, qualification or compliance, and will reimburse the
Registrant, such directors, officers or control persons or underwriters for any
legal or any other expenses reasonably incurred in connection with
investigating, preparing or defending any such claim, loss, damage, liability or
action, in each case to the extent, but only to the extent, that such untrue
statement (or alleged untrue statement) or omission (or alleged omission) is
made in such registration statement, prospectus, offering circular or other
document in reliance upon and in conformity with written information furnished
to the Registrant by the Holder expressly for use therein, provided that in no
event shall any indemnity under this Section 6(e) exceed the gross proceeds of
the offering received by the Holder and provided further that the indemnity
agreement contained in this subsection 6(e)(ii) shall not apply to amounts paid
in settlement of any such loss, claim, damage, liability or action if such
settlement is effected without the consent of the Holder, which consent shall
not be unreasonably withheld.
(iii) Each party entitled to indemnification under this Section
6(e) (the "INDEMNIFIED PARTY") shall give notice to the party required to
provide indemnification (the "INDEMNIFYING PARTY") promptly after such
Indemnified Party has actual knowledge of any claim as to which indemnity may be
sought, and shall permit the Indemnifying Party to assume the defense of any
such claim or any litigation resulting therefrom, provided that counsel for the
Indemnifying Party, who shall conduct the defense of such claim or litigation,
shall be approved by the Indemnified Party (whose approval shall not
unreasonably be withheld), and the Indemnified Party may participate in such
defense at such party's expense; provided, however, that the Indemnifying Party
shall pay such expense if representation of the Indemnified Party by counsel
retained by the Indemnifying Party would be inappropriate due to actual or
potential differing interests between the Indemnified Party and any other party
represented by such counsel in such proceeding, and provided further that the
failure of any Indemnified Party to give notice as provided herein shall not
relieve the Indemnifying Party of its obligations under this Section 6(e) unless
the failure to give such notice is materially prejudicial to an Indemnifying
Party's ability to defend such action. No Indemnifying Party, in the defense of
any such claim or litigation shall, except with the consent of each Indemnified
Party, consent to entry of any judgment or enter into any settlement which does
not include as an unconditional term thereof the giving by the claimant or
plaintiff to such Indemnified Party of a release from all liability in respect
to such claim or litigation. No Indemnifying Party shall be required to
indemnify any Indemnified Party with respect to any settlement entered into
without such Indemnifying Party's prior consent (which shall not be unreasonably
withheld).
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7. Representations and Warranties of Parent
(a) Investment Purpose. Any Option Shares Parent acquires pursuant to
this Option will be acquired for Parent's own account, and no one else will have
any interest in such Option Shares. Parent will acquire Option Shares for
investment purposes only, and not with a view to any resale or distribution
thereof, and will not sell any of the Option Shares purchased pursuant to this
Agreement except in compliance with state and federal securities law. Parent
acknowledges that, as of the date of this Agreement, the Option Shares have not
been registered under federal or state law and may not be resold without
registration under state and federal securities laws or applicable exemptions
from such registration requirements. Parent also acknowledges that the Company
is relying on these representations, warranties and covenants for purposes of
determining whether Parent is eligible to receive this Option or purchase any
Option Shares without registration under applicable state and federal securities
laws.
(b) Ability to Bear Risk; Sophistication; Access to Information.
Parent represents, warrants and covenants that Parent will be able to bear the
economic risk of any investment in the Option Shares for an indefinite period.
In addition, Parent represents, warrants and covenants that at the time Parent
exercises this Option, Parent, or Parent's financial advisor, will have such
knowledge and experience in financial and business matters that Parent will be
capable of evaluating the merits and risks of the prospective investment in the
Option Shares. In addition, Parent represents, warrants and covenants that at
the time Parent exercises this Option, Parent will have, or Parent's financial
advisor will have, carefully reviewed all of the information regarding the
Company, access to which will be accorded to Parent, and Parent will be
thoroughly familiar with the business, operations, properties, financial
condition, results of operations, prospects and risks of the Company and its
business by virtue of Parent's review and of Parent's relationship with the
Company and will have discussed with officers of the Company any questions
Parent may have with respect to the Company or its securities.
(c) Opinion of Counsel for Transfers. Parent will not dispose of all
or any part of or any interest in this Option or any of the Option Shares Parent
acquires upon exercise of this Option, or encumber, pledge, hypothecate, sell or
transfer this Option, any of such Option Shares or any interest therein, unless
Parent furnishes the Company, upon it's request, with an opinion of counsel in
form and substance satisfactory to the Company to the effect that the
disposition will not require registration of this Option or any of the Option
Shares. The Company may refuse to transfer this Option or any Option Shares if
it believes that such transfer will require registration or qualification of the
Option Shares under any securities laws or result in a breach of any of Parent's
representations, warranties or covenants in this Agreement.
8. Adjustment Upon Changes in Capitalization; Rights Plans
(a) In the event of any change in the Company Shares by reason of
stock dividends, stock splits, reverse stock splits, mergers (other than the
Company Merger), recapitalizations, combinations, exchanges of shares and the
like, the type and number of shares or securities subject to the Option and the
Exercise Price shall be adjusted appropriately, and
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proper provision shall be made in the agreements governing such transaction so
that Parent shall receive, upon exercise of the Option, the number and class of
shares or other securities or property that Parent would have received in
respect of the Company Shares if the Option had been exercised immediately prior
to such event or the record date therefor, as applicable.
(b) Prior to such time as the Option is terminated, and at any time
after the Option is exercised (in whole or in part, if at all), Company shall
not (i) adopt (nor permit the adoption of) a Rights Agreement (as defined in the
Merger Agreement) that contains provisions for the distribution or exercise of
rights thereunder as a result of Parent or any affiliate or transferee of Parent
being the beneficial owner of shares of Company by virtue of the Option being
exercisable or having been exercised (or as a result of beneficially owning
shares issuable in respect of any Option Shares), or (ii) take any other action
which would prevent or disable Parent from exercising its rights under this
Agreement or enjoying the full rights and privileges possessed by other holders
of Company Common Stock generally.
9. Surrender of Option. If, at any time after the occurrence of an
Exercise Event and prior to the termination of the Option, any person or "group"
(as defined under Section 13(d) of the Exchange Act and the rules and
regulations thereunder) other than Parent, Merger Sub 1, Merger Sub 2 and their
affiliates (an "ACQUIRING PERSON") (a) acquires beneficial ownership of more
than a 50% interest in the total outstanding voting securities of Company or any
of its subsidiaries (provided, however, that no exercise by a shareholder of the
Company as of the date of this Agreement of any Company Options that are
outstanding and held by such shareholder as of the date of this Agreement shall
be deemed to cause a person to be the beneficial owner of such interest of more
than 50%) or (b) shall have entered into an agreement with Company for, or shall
have effected, a merger, consolidation, business combination or similar
transaction involving Company, or any sale, lease (other than in the ordinary
course of business), exchange, transfer, license (other than in the ordinary
course of business), acquisition or disposition of more than 50% of the assets
of Company, then Parent may, at its sole option and upon Parent's written
request to Company, surrender the Option to Company in exchange for the payment
by Company to Parent in immediately available funds of an amount equal to the
product of: (x) the excess, if any, of (i) the closing sale price of Company
Common Stock on the Nasdaq National Market on the trading day immediately
preceding the date of such request over (ii) the Exercise Price, multiplied by
(y) the total number of Option Shares as to which the Option has not theretofore
been exercised. Upon the delivery by Parent to Company of a surrender request,
each party shall take all actions necessary to consummate such surrender
transaction as expeditiously as possible. Upon exercise of its right to
surrender the Option or any portion thereof and full payment therefor to Parent
pursuant to this Section 8, any and all rights of Parent with respect to the
portion of the Option so surrendered shall be terminated.
10. Restrictive Legends. Each certificate representing Option Shares
issued to Parent hereunder (other than certificates representing shares sold in
a registered public offering
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pursuant to Section 6) shall include a legend in substantially the following
form:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS
AND MAY BE REOFFERED OR SOLD ONLY IF SO REGISTERED OR IF THE COMPANY
RECEIVES AN OPINION OF COUNSEL, REASONABLY SATISFACTORY TO IT, THAT AN
EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE.
11. Listing and HSR Filing. The Company, upon the request of Parent,
shall promptly file an application to list the Company Shares to be acquired
upon exercise of the Option for quotation on the Nasdaq National Market and
shall use its reasonable efforts to obtain approval of such listing as promptly
as practicable. Promptly after the date hereof, each of the parties hereto shall
promptly file with the Federal Trade Commission and the Antitrust Division of
the United States Department of Justice all required premerger notification and
report forms and other documents and exhibits required to be filed under the HSR
Act to permit the acquisition of the Company Shares subject to the Option at the
earliest possible date.
12. Binding Effect. This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective successors and permitted
assigns. Nothing contained in this Agreement, express or implied, is intended to
confer upon any person other than the parties hereto and their respective
successors and permitted assigns any rights or remedies of any nature whatsoever
by reason of this Agreement.
13. Specific Performance. The parties recognize and agree that if for
any reason any of the provisions of this Agreement are not performed in
accordance with their specific terms or are otherwise breached, immediate and
irreparable harm or injury would be caused for which money damages would not be
an adequate remedy. Accordingly, each party agrees that in addition to other
remedies the other party shall be entitled to an injunction restraining any
violation or threatened violation of the provisions of this Agreement. In the
event that any action shall be brought in equity to enforce the provisions of
the Agreement, neither party will allege, and each party hereby waives the
defense, that there is an adequate remedy at law.
14. Entire Agreement. This Agreement and the Merger Agreement
(including the appendices and exhibits thereto) constitute the entire agreement
between the parties with respect to the subject matter hereof and supersede all
other prior agreements and understandings, both written and oral, between the
parties with respect to the subject matter hereof.
15. Further Assurances. Each party will execute and deliver all such
further documents and instruments and take all such further action as may be
necessary in order to consummate as promptly as practicable the transactions
contemplated hereby.
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16. Severability. In the event that any provision of this Agreement or
the application thereof, becomes or is declared by a court of competent
jurisdiction to be illegal, void or unenforceable, the remainder of this
Agreement will continue in full force and effect and the application of such
provision to other persons or circumstances will be interpreted so as reasonably
to effect the intent of the parties hereto. The parties further agree to replace
such void or unenforceable provision of this Agreement with a valid and
enforceable provision that will achieve, to the extent possible, the economic,
business and other purposes of such void or unenforceable provision.
17. Notices. All notices and other communications hereunder shall be in
writing and shall be deemed given (1) when delivered personally, (2) on the date
delivery is made if sent by commercial delivery service, (3) five business days
after being mailed if mailed by registered or certified mail (postage prepaid,
return receipt requested, or (4) on the date sent if sent via facsimile,
telegraph or telex (receipt confirmed) to the parties at the following addresses
or facsimile numbers (or at such other address or facsimile numbers for a party
as shall be specified by like notice):
(a) if to Parent, to:
If sent by registered or certified mail, to:
Intuit Inc.
Attn: General Counsel
▇▇▇▇▇ ▇▇▇▇.
▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Fax No. (▇▇▇) ▇▇▇-▇▇▇▇
If personally delivered or delivered by commercial
delivery service, to:
Intuit Inc.
Attn: General Counsel
Legal Dept.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax No. (▇▇▇)-▇▇▇-▇▇▇▇
with a copy to:
Fenwick & West LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Fax No. (▇▇▇) ▇▇▇-▇▇▇▇
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(b) if to Company, to:
Rock Financial Corporation
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▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: President
Fax No. (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ and ▇▇▇▇
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Fax No.(▇▇▇) ▇▇▇-▇▇▇▇
17. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of California, regardless of the laws that
might otherwise govern under applicable principles of conflicts of law.
18. Counterparts. This Agreement may be executed in one or more
counterparts, all of which shall be considered one and the same agreement and
shall become effective when one or more counterparts have been signed by each of
the parties and delivered to the other party, it being understood that all
parties need not sign the same counterpart.
19. Expenses. Except as otherwise expressly provided herein or in the
Merger Agreement, all costs and expenses incurred in connection with the
transactions contemplated by this Agreement shall be paid by the party incurring
such expenses.
20. Amendments; Waiver. This Agreement may be amended by the parties
hereto and the terms and conditions hereof may be waived only by an instrument
in writing signed on behalf of each of the parties hereto, or, in the case of a
waiver, by an instrument signed on behalf of the party waiving compliance.
21. Assignment. Neither party hereto may sell, transfer, assign or
otherwise dispose of this Agreement or any of its rights or obligations under
this Agreement or the Option created hereunder to any other person, without the
express written consent of the other party. Any purported assignment in
violation of this Section shall be void. The rights and obligations hereunder
shall inure to the benefit of and be binding upon any permitted successor of a
party hereto.
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22. WAIVER OF JURY TRIAL. EACH OF PARENT AND COMPANY HEREBY IRREVOCABLY
WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM
(WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO
THIS AGREEMENT OR THE ACTIONS OF PARENT OR COMPANY IN THE NEGOTIATION,
ADMINISTRATION, PERFORMANCE AND ENFORCEMENT HEREOF.
[THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized respective officers as of the date first
written above.
ROCK FINANCIAL CORPORATION
By:
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Name:
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Title:
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INTUIT INC.
By:
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Name:
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Title:
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[SIGNATURE PAGE TO STOCK OPTION AGREEMENT]
