Warrant Purchase and Voting Agreement - Washington Mutual Inc. and Warburg Pincus
EXECUTION COPY
WARRANT PURCHASE AND VOTING AGREEMENT
WARRANT PURCHASE AND VOTING AGREEMENT, dated as of June 25,
2001 (this "Agreement"), between Washington Mutual, Inc., a Washington
corporation ("Washington Mutual"), and Warburg, Pincus Equity Partners, L.P., a
Delaware limited partnership ("Warburg, Pincus"), Warburg, Pincus Netherlands
Equity Partners I, C.V., a Dutch limited partnership ("Warburg, Pincus
Netherlands I"), Warburg, Pincus Netherlands Equity Partners II, C.V., a Dutch
limited partnership ("Warburg, Pincus Netherlands II"), Warburg, Pincus
Netherlands Equity Partners III, C.V., a Dutch limited partnership ("Warburg,
Pincus Netherlands III") (each of Warburg, Pincus, Warburg, Pincus Netherlands
I, Warburg, Pincus Netherlands II and Warburg, Pincus Netherlands III, a
"Stockholder", and collectively, the "Stockholders").
W I T N E S S E T H:
WHEREAS, Washington Mutual and Dime Bancorp, Inc., a Delaware
corporation ("Dime"), are, concurrently with the execution and delivery of this
Agreement, entering into an Agreement and Plan of Merger, dated as of the date
hereof (the "Merger Agreement;" capitalized terms used without definition herein
having the meanings assigned to them in the Merger Agreement), providing for the
merger of Dime with and into Washington Mutual (the "Merger");
WHEREAS, as of the date hereof, the Stockholders are the
record and beneficial owners, collectively, of (i) 13,607,664 shares of common
stock, par value $0.01 per share, of Dime ("Dime Common Stock"), (the "Existing
Shares" and, together with any shares of Dime Common Stock or other voting
capital stock of Dime acquired by the Stockholders after the date hereof,
whether upon the exercise of warrants or options, the conversion of convertible
securities or otherwise, the "Shares"), (ii) warrants (the "Series C Warrants")
to acquire 8,142.738 shares of Series C junior nonvoting convertible preferred
stock, par value $0.01 per share and liquidation preference of $0.01 per share,
of Dime (the "Series C Preferred Stock") and (iii) warrants (the "Series D
Warrants" and, together with the Series C Warrants, the "Warrants") to acquire
5,464.926 shares of Series D junior nonvoting convertible preferred stock, par
value $0.01 per share and liquidation preference of $0.01 per share, of Dime
(the "Series D Preferred Stock"); and
WHEREAS, Dime and Warburg, Pincus are party to an Investment
Agreement, dated as of July 6, 2000 (the "Investment Agreement"), which, among
other things, grants the Stockholders certain rights with respect to the
Warrants.
NOW THEREFORE, in consideration of the foregoing and the
mutual representations, warranties, covenants and agreements herein contained,
and intending to be legally bound hereby, the parties hereto agree as follows:
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ARTICLE I
PURCHASE AND SALE OF THE WARRANTS
1.1. Purchase and Sale of the Warrants. On the terms and subject to the
conditions of this Agreement, at the Warrant Purchase Closing (as defined in
Section 1.2), the Stockholders shall sell, transfer and deliver to Washington
Mutual, and Washington Mutual shall purchase from the Stockholders, the Warrants
(such sale, transfer and delivery and such purchase is hereinafter referred to
as the "Warrant Purchase"). In consideration of the sale, transfer and delivery
of the Warrants by the Stockholders, the Stockholders shall be entitled to the
right to receive the same Merger Consideration with respect to the Deemed Shares
(as defined below) as if the Stockholders had been holders of the Deemed Shares
immediately prior to the Effective Time in accordance with the election
procedures set forth in Section 2.6 of the Merger Agreement. The "Deemed Shares"
shall mean 7,903,073 shares of Dime Common Stock, which the parties hereto
hereby agree to in lieu of the number of shares of Dime Common Stock which the
Stockholders would have been entitled to receive under Section 4.2(d) of the
Investment Agreement had the Stockholders exercised their rights under such
Section immediately prior to the execution of the Merger Agreement with respect
to all of the Warrants and had Dime elected to pay all of the purchase price
payable to the Stockholders pursuant to such Section in shares of Dime Common
Stock. The parties hereto further agree that (i) for purposes of valuation of
the Warrants pursuant to Section 4.2(d) of the Investment Agreement, (x) the
Acquiror's Share Price (as defined in Exhibit 10 to the Investment Agreement)
shall be deemed to be the average of the closing prices of shares of Washington
Mutual Common Stock as reported on the New York Stock Exchange Composite
Transactions Tape for the five consecutive trading days ending on the trading
day immediately preceding the announcement of the signing of the Merger
Agreement (such average closing price, the "Announcement Price") and (y) in
calculating the underlying security price for purposes of the Black-Scholes
model, the Merger shall be treated as a fixed exchange ratio transaction and
(ii) the Dime Common Stock that would have been payable pursuant to Section
4.2(d) of the Investment Agreement shall be valued at 1.05 multiplied by the
Announcement Price. Notwithstanding the foregoing, (A) if the Exchange Ratio is
adjusted pursuant to Section 2.5(f) of the Merger Agreement, appropriate
adjustment shall be made to the Deemed Shares and (B) in the event that the
merger consideration payable under the Merger Agreement is otherwise increased,
this Section 1.1 shall be appropriately amended, taking into account the
methodology used herein and the terms of the Investment Agreement, including
Exhibit 10 thereto.
1.2. Closing. Unless this Agreement shall have been terminated pursuant
to Section 5.1, and subject to the satisfaction or waiver (where applicable) of
the conditions set forth in Section 1.3, the closing of the Warrant Purchase
(the "Warrant Purchase Closing") will take place concurrently with the Closing
of the Merger, at the time and place and on the date provided in Section 2.4 of
the Merger Agreement.
At the Warrant Purchase Closing, the Stockholders shall deliver to
Washington Mutual certificates representing the Warrants duly endorsed in blank
or accompanied by appropriate powers duly endorsed in blank or in proper form
for transfer, with appropriate transfer stamps, if any, affixed. Washington
Mutual shall cause the Exchange Agent to deliver to the Stockholders
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Election Forms for the Stockholders' use, in accordance with the terms of
Section 2.6 of the Merger Agreement, with respect to the Deemed Shares.
1.3. Conditions to Closing of Warrant Purchase. (a) The obligations of
Washington Mutual to consummate the Warrant Purchase shall be subject to the
satisfaction or waiver by Washington Mutual of the following conditions:
(i) All regulatory approvals required to consummate
the Warrant Purchase shall have been obtained and shall remain
in full force and effect and all statutory waiting periods in
respect thereof shall have expired or been terminated.
(ii) No Injunction preventing the consummation of the
Warrant Purchase shall be in effect. No statute, rule,
regulation, order, injunction or decree shall have been
enacted, entered, promulgated or enforced by any Governmental
Entity which prohibits or makes illegal the consummation of
the Warrant Purchase.
(iii) The representations and warranties of the
Stockholders contained herein shall have been true and correct
in all material respects as of the date hereof and shall be
true and correct in all material respects at and as of the
Closing Date as if made at and as of the Closing Date. The
Stockholders shall have performed in all material respects all
of their covenants and obligations contained herein required
to be performed by them on or prior to the Closing Date.
Washington Mutual shall have received a certificate signed on
behalf of the Stockholders by their general partner to the
foregoing effect.
(iv) The Closing of the Merger shall occur
concurrently.
(b) The obligations of the Stockholders to consummate the Warrant
Purchase shall be subject to the satisfaction or waiver by the Stockholders of
the following conditions:
(i) All regulatory approvals required to consummate
the Warrant Purchase shall have been obtained and shall remain
in full force and effect and all statutory waiting periods in
respect thereof shall have expired or been terminated.
(ii) No Injunction preventing the consummation of the
Warrant Purchase shall be in effect. No statute, rule,
regulation, order, injunction or decree shall have been
enacted, entered, promulgated or enforced by any Governmental
Entity which prohibits or makes illegal the consummation of
the Warrant Purchase.
(iii) The representations and warranties of
Washington Mutual contained herein shall have been true and
correct in all material respects as of the date hereof and
shall be true and correct in all material respects as of the
Closing Date. Washington Mutual shall have performed in all
material respects all of its covenants and obligations
contained herein required to be performed by it on or prior to
the Closing Date. The Stockholders shall have received a
certificate signed on behalf of Washington Mutual by the Chief
Executive Officer and the Chief Financial Officer of
Washington Mutual, to the foregoing effect.
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(iv) The Closing of the Merger shall occur
concurrently.
1.4. Termination of Investment Agreement. As of the Effective Time, the
Investment Agreement shall be terminated and shall be of no further force or
effect.
ARTICLE II
VOTING
2.1. Agreement to Vote. The Stockholders hereby agree that, from and
after the date hereof and until the date on which this Agreement is terminated
pursuant to Section 5.1, at the Dime Stockholders Meeting or any other meeting
of the stockholders of Dime, however called, or in connection with any written
consent of the stockholders of Dime, the Stockholders shall:
(a) appear at each such meeting or otherwise cause the Shares
to be counted as present thereat for purposes of calculating a quorum; and
(b) vote (or cause to be voted), in person or by proxy, or
deliver a written consent (or cause a consent to be delivered) covering, all the
Shares, and any other voting securities of Dime (whether acquired heretofore or
hereafter), that are beneficially owned by the Stockholders or as to which the
Stockholders have, directly or indirectly, the right to vote or direct the
voting, (i) in favor of adoption and approval of the Merger Agreement and the
Merger and any other action requested by Washington Mutual in furtherance
thereof; (ii) against any action or agreement that would result in a breach of
any covenant, representation or warranty or any other obligation or agreement of
Dime contained in the Merger Agreement or of the Stockholders contained in this
Agreement; and (iii) against any Acquisition Proposal or any other action,
agreement or transaction that is intended, or could reasonably be expected, to
materially impede, interfere or be inconsistent with, delay, postpone,
discourage or materially and adversely affect the Merger or this Agreement,
including: (A) any extraordinary corporate transaction, such as a merger,
consolidation or other business combination involving Dime or its Subsidiaries
(other than the Merger); (B) a sale, lease or transfer of a material amount of
assets of Dime or any of its Subsidiaries or a reorganization, recapitalization
or liquidation of Dime or any of its Subsidiaries; (C) a material change in the
policies or management of Dime; (D) an election of new members to the board of
directors of Dime, except where the vote is cast in favor of the nominees of a
majority of the existing directors; (E) any material change in the present
capitalization or dividend policy of Dime or any amendment or other change to
Dime's certificate of incorporation or bylaws; or (F) any other material change
in Dime's corporate structure or business; provided, however, that nothing in
this Agreement shall limit or affect any actions taken by any member of the
board of directors of Dime nominated by, or appointed at the request of, the
Stockholders solely in his or her capacity as a director of Dime; provided,
further, that nothing in this Agreement shall be interpreted as obligating the
Stockholders to exercise any Warrants.
2.2. No Inconsistent Agreements. The Stockholders hereby covenant and
agree that, except for this Agreement, none of the Stockholders (a) has entered,
and none of the
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Stockholders shall enter at any time while this Agreement remains in effect,
into any voting agreement or voting trust with respect to the Shares and (b) has
not granted, and none of the Stockholders shall grant at any time while this
Agreement remains in effect, a proxy, a consent or power of attorney with
respect to the Shares or the Warrants.
2.3. Proxy. The Stockholders hereby grant a proxy, and appoint as
attorney-in-fact, Fay Chapman, William Longbrake and Craig Tall, in their
respective capacities as officers of Washington Mutual, and any individual who
shall hereafter succeed to any such officer of Washington Mutual, and any other
person designated in writing by Washington Mutual, each of them individually,
with full power of substitution, to vote the Shares in accordance with Section
2.1 hereof. This proxy is coupled with an interest and shall be irrevocable for
so long as this Agreement is in effect, and the Stockholders will take such
further action or execute such other instruments as may be necessary to
effectuate the intent of this proxy and hereby revokes any proxy previously
granted by any Stockholder with respect to the Shares. The foregoing proxy is
subject to, and shall only become effective upon, Washington Mutual having
received all necessary regulatory approvals and consents, if any, required under
applicable law to exercise the voting powers granted by such proxy. Washington
Mutual may terminate this proxy with respect to the Stockholders by written
notice.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
3.1. Representations and Warranties of the Stockholders. The
Stockholders, jointly and severally, hereby represent and warrant to Washington
Mutual as follows:
(a) Organization; Authorization; Validity of Agreement; Necessary
Action. Each Stockholder is a limited partnership duly organized, validly
existing and in good standing under the laws of its jurisdiction of
organization. Each Stockholder has full power and authority to execute and
deliver this Agreement, to perform its obligations hereunder and to consummate
the transactions contemplated hereby. The execution, delivery and performance by
each Stockholder of this Agreement and the consummation by it of the
transactions contemplated hereby have been duly and validly authorized by such
Stockholder and no other actions or proceedings on the part of such Stockholder
or any general or limited partner therein are necessary to authorize the
execution and delivery by it of this Agreement and the consummation by it of the
transactions contemplated hereby. This Agreement has been duly executed and
delivered by each Stockholder and, assuming this Agreement constitutes a valid
and binding obligation of Washington Mutual, constitutes a valid and binding
obligation of each Stockholder, enforceable against it in accordance with its
terms, except as 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 and similar laws affecting creditors' rights and remedies generally.
(b) Ownership. The Existing Shares and the Warrants are, and all of the
Shares and Warrants from the date hereof through and on the Closing Date will
be, owned beneficially and
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of record by the Stockholders. As of the date hereof, (i) Warburg, Pincus holds
of record 12,859,243 shares of Dime Common Stock, 7694.8874 Series C Warrants
and 5164.3551 Series D Warrants, (ii) Warburg, Pincus Netherlands I holds of
record 408,230 shares of Dime Common Stock, 244.2821 Series C Warrants and
163.9478 Series D Warrants, (iii) Warburg, Pincus Netherlands II holds of record
272,153 shares of Dime Common Stock, 162.8548 Series C Warrants and 109.2985
Series D Warrants and (iv) Warburg, Pincus Netherlands III holds of record
68,038 shares of Dime Common Stock, 40.7137 Series C Warrants and 27.3246 Series
D Warrants. Each Series C Warrant is exercisable for 1 share of Series C
Preferred Stock, which is convertible into 1,000 shares of Dime Common Stock.
Each Series D Warrant is exercisable for 1 share of Series D Preferred Stock,
which is convertible into 1,000 shares of Dime Common Stock. As of the date
hereof, (i) the Existing Shares constitute all of the shares of Dime Common
Stock and (ii) the Warrants constitute all warrants to acquire shares of Dime
Common Stock, in each case held of record, owned by or for which voting power or
disposition power is held or shared by the Stockholders or any of their
respective affiliates (but excluding 2,000 restricted shares of Dime Common
Stock and 3,000 options exercisable for Dime Common Stock, subject to vesting,
received by the Stockholders' representative member of Dime's board of
directors). The Stockholders (x) have and will have at all times through the
Closing Date, together with their general partner, sole voting power, sole power
of disposition, sole power to issue instructions with respect to the matters set
forth in Article II hereof, and sole power to agree to all of the matters set
forth in this Agreement, in each case with respect to all of the Existing Shares
and with respect to all of the Shares on the Closing Date, and (y) have and will
have sole power of disposition with respect to the Warrants, in each case with
no limitations, qualifications or restrictions on such rights, subject to
applicable federal securities laws and the terms of this Agreement. The
Stockholders have good and marketable title to the Existing Shares and the
Warrants, free and clear of any Liens. At the Warrant Purchase Closing,
Washington Mutual shall acquire good and marketable title to the Warrants, free
and clear of any Liens.
(c) No Violation. The execution and delivery of this Agreement by the
Stockholders does not, and the performance by the Stockholders of their
obligations under this Agreement will not, (i) conflict with or violate the
limited partnership agreement of any Stockholder, (ii) conflict with or violate
any law, ordinance or regulation of any Governmental Entity applicable to any
Stockholder or by which any of its assets or properties is bound, or (iii)
conflict with, result in any breach of or constitute a default (or an event that
with notice or lapse of time or both would become a default) under, or give to
others any rights of termination, amendment, acceleration or cancellation of, or
require payment under, or require redemption or repurchase of or otherwise
require the purchase or sale of any securities, or result in the creation of any
Lien on the properties or assets of any Stockholder pursuant to, any note, bond,
mortgage, indenture, contract, agreement, lease, license, permit, franchise or
other instrument or obligation to which any Stockholder is a party or by which
any Stockholder or any of its assets or properties is bound, except for any of
the foregoing as could not reasonably be expected, either individually or in the
aggregate, to materially impair the ability of the Stockholders to perform their
obligations hereunder or to consummate the transactions contemplated hereby on a
timely basis.
(d) Consents and Approvals. The execution and delivery of this
Agreement by the Stockholders does not, and the performance by the Stockholders
of their obligations under this Agreement will not, require any Stockholder to
obtain any consent, approval, authorization or permit of, or to make any filing
with or notification to, any Governmental Entity based on the law,
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ordinance or regulation of any applicable Governmental Entity, except for any of
the foregoing as could not reasonably be expected, either individually or in the
aggregate, to materially impair the ability of the Stockholders to perform their
obligations hereunder or to consummate the transactions contemplated hereby on a
timely basis.
(e) Absence of Litigation. There is no suit, action, investigation or
proceeding pending or, to the knowledge of the Stockholders, threatened against
any Stockholder before or by any Governmental Entity that could reasonably be
expected to materially impair the ability of the Stockholders to perform their
obligations hereunder or to consummate the transactions contemplated hereby on a
timely basis.
(f) Absence of Agreements with Dime. Except for the Investment
Agreement and the letter agreement (the "Letter Agreement") among the
Stockholders and Dime, dated as of the date hereof and attached as Exhibit A
hereto, there are no existing agreements or arrangements between any Stockholder
or any of its affiliates, on one hand, and Dime or any of its Subsidiaries, on
the other hand, relating to the Shares, the Warrants or any other securities of
or investment in Dime.
(g) Broker's Fees. Neither the Stockholders nor any of their respective
affiliates has employed any broker or finder or incurred any liability for any
broker's fees, commissions or finder's fees in connection with any of the
transactions contemplated by this Agreement.
3.2. Representations and Warranties of Washington Mutual. Washington
Mutual hereby represents and warrants to the Stockholders as follows:
(a) Organization; Authorization; Validity of Agreement; Necessary
Action. Washington Mutual is a corporation duly organized under the laws of the
State of Washington and is validly existing and in good standing under the laws
of the State of Washington. Washington Mutual has full corporate power and
authority to execute and deliver this Agreement, to perform its obligations
hereunder and to consummate the transactions contemplated hereby. The execution,
delivery and performance by Washington Mutual of this Agreement and the
consummation by it of the transactions contemplated hereby have been duly and
validly authorized by Washington Mutual and no other corporate actions or
proceedings on the part of Washington Mutual are necessary to authorize the
execution and delivery by it of this Agreement and the consummation by it of the
transactions contemplated hereby. This Agreement has been duly executed and
delivered by Washington Mutual and, assuming this Agreement constitutes a valid
and binding obligation of the Stockholders, constitutes a valid and binding
obligation of Washington Mutual, enforceable against it in accordance with its
terms, except as 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 and similar laws affecting creditors' rights and remedies generally.
(b) No Violation. The execution and delivery of this Agreement by
Washington Mutual does not, and the performance by Washington Mutual of its
obligations under this Agreement will not, (i) conflict with or violate the
articles of incorporation or bylaws of Washington Mutual, (ii) conflict with or
violate any law, ordinance or regulation of any Governmental Entity applicable
to Washington Mutual or by which any of its assets or properties is bound, or
(iii) conflict with, result in any breach of or constitute a default (or an
event that with
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notice or lapse of time or both would become a default) under, or give to others
any rights of termination, amendment, acceleration or cancellation of, or
require payment under, or require redemption or repurchase of or otherwise
require the purchase or sale of any securities, or result in the creation of any
Lien on the properties or assets of Washington Mutual pursuant to, any note,
bond, mortgage, indenture, contract, agreement, lease, license, permit,
franchise or other instrument or obligation to which Washington Mutual is a
party or by which Washington Mutual or any of its assets or properties is bound,
except for any of the foregoing as could not reasonably be expected, either
individually or in the aggregate, to materially impair the ability of Washington
Mutual to perform its obligations hereunder or to consummate the transactions
contemplated hereby on a timely basis.
(c) Consents and Approvals. Except for those consents, approvals,
authorizations, permits, filings and notifications set forth in Section 5.4 of
the Merger Agreement, the execution and delivery of this Agreement by Washington
Mutual does not, and the performance by Washington Mutual of its obligations
under this Agreement will not, require Washington Mutual to obtain any consent,
approval, authorization or permit of, or to make any filing with or notification
to, any Governmental Entity based on the law, ordinance or regulation of any
applicable Governmental Entity, except for any of the foregoing as could not
reasonably be expected, either individually or in the aggregate, to materially
impair the ability of Washington Mutual to perform its obligations hereunder or
to consummate the transactions contemplated hereby on a timely basis.
(d) Absence of Litigation. There is no suit, action, investigation or
proceeding pending or, to the knowledge of Washington Mutual, threatened against
Washington Mutual before or by any Governmental Entity that could reasonably be
expected to materially impair the ability of Washington Mutual to perform its
obligations hereunder or to consummate the transactions contemplated hereby on a
timely basis.
(e) Broker's Fees. Except as set forth in Section 5.7 of the Washington
Mutual Disclosure Schedule, neither Washington Mutual nor any Subsidiary thereof
nor any of their respective officers or directors has employed any broker or
finder or incurred any liability for any broker's fees, commissions or finder's
fees in connection with any of the transactions contemplated by this Agreement.
ARTICLE IV
OTHER COVENANTS
4.1. Further Agreements of the Stockholders. (a) The Stockholders
hereby agree, while this Agreement is in effect, and except as expressly
contemplated hereby, not to sell, transfer, pledge, encumber, assign,
distribute, gift or otherwise dispose of (collectively, a "Transfer") or enforce
or permit the execution of the provisions of any redemption, share purchase or
sale, recapitalization or other agreement with Dime or any other person or enter
into any contract, option or other arrangement or understanding with respect to
any Transfer (whether by actual disposition or effective economic disposition
due to hedging, cash settlement or otherwise) of, any of the
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Existing Shares, any Shares acquired after the date hereof, any securities
exercisable or exchangeable for or convertible into Dime Common Stock (including
the Warrants), any other capital stock of Dime or any interest in any of the
foregoing with any person. Without limiting the foregoing, the Stockholders
hereby agree that, while this Agreement is in effect, they will not exercise
their rights to require Dime to repurchase the Warrants pursuant to Section
4.2(d) or (e) of the Investment Agreement.
(b) In the event of a stock dividend or distribution, or any change in
Dime Common Stock by reason of any stock dividend or distribution, split-up,
recapitalization, combination, exchange of shares or the like, the term "Shares"
shall be deemed to refer to and include the Shares as well as all such stock
dividends and distributions and any securities into which or for which any or
all of the Shares may be changed or exchanged or which are received in such
transaction.
(c) The Stockholders hereby agree that during the term of this
Agreement they shall not, and shall not permit any of their respective
Representatives to, (i) initiate, solicit, encourage or knowingly facilitate,
directly or indirectly, any inquiries or the making of any proposal with respect
to any matter described in Section 4.1(a) or any Acquisition Proposal, (ii)
participate in any negotiations concerning, or provide to any other person any
nonpublic information or data relating to Dime or any of its Subsidiaries for
the purpose of, or have any discussions with, any person relating to, or
cooperate with or assist or participate in, or knowingly facilitate, any
inquiries or the making of any proposal which constitutes, or would reasonably
be expected to lead to, any effort or attempt by any other person to seek to
effect any matter described in Section 4.1(a) or any Acquisition Proposal, or
(iii) agree to or release any person from any obligation under any existing
standstill agreement or arrangement relating to Dime. The Stockholders agree
immediately to cease and cause to be terminated any existing activities,
discussions or negotiations with any parties conducted heretofore with respect
to any possible Acquisition Proposal, or any matter described in Section 4.1(a),
and the Stockholders will take the necessary steps to inform their respective
Representatives of the obligations undertaken by the Stockholders pursuant to
this Section 4.1. Nothing contained in this Section 4.1(c) shall prevent any
representative of any Stockholder from discharging his or her fiduciary duties
as a member of the board of directors of Dime.
(d) The Stockholders hereby agree, while this Agreement is in effect,
to notify Washington Mutual promptly in writing of (i) the number of any
additional shares of Dime Common Stock or other securities of Dime acquired by
any Stockholder, if any, after the date hereof and (ii) any such inquiries or
proposals which are received by, any such information which is requested from,
or any such negotiations or discussions which are sought to be initiated or
continued with, any Stockholder with respect to any matter described in Section
4.1(a) or (c).
(e) While this Agreement is in effect, the Stockholders hereby waive
any and all rights they may have pursuant to Sections 4.2(b)(5) and 4.10 of the
Investment Agreement.
4.2. Further Agreements of Washington Mutual. Washington Mutual hereby
agrees that while this Agreement is in effect it will not modify, waive or amend
any provision of the Merger Agreement in a manner that affects the type or
amount of consideration that the Stockholders are entitled to receive hereunder
in respect of the Warrant Purchase. Except for the
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foregoing, the Stockholders shall not have any rights as third party
beneficiaries or otherwise under or in respect of the Merger Agreement.
ARTICLE V
MISCELLANEOUS
5.1. Termination. This Agreement shall terminate and no party shall
have any rights or duties hereunder if this Agreement is terminated in
accordance with the terms of this Section 5.1. Either of Washington Mutual or
the Stockholders may terminate this Agreement on or after the date of
termination of the Merger Agreement in accordance with its terms. Nothing in
this Section 5.1 shall relieve or otherwise limit any party of liability for
breach of this Agreement.
5.2. Stop Transfer Order. In furtherance of this Agreement, the
Stockholders shall and hereby do authorize and instruct Dime to instruct its
transfer agent to enter a stop transfer order with respect to all of the
Existing Shares, the Warrants and all Shares acquired by the Stockholders after
the date hereof.
5.3. Further Assurances. From time to time, at the other party's
request and without further consideration, each party shall execute and deliver
such additional documents and take all such further action as may be necessary
or desirable to consummate the transactions contemplated by this Agreement.
5.4. No Ownership Interest. Nothing contained in this Agreement shall
be deemed to vest in Washington Mutual any direct or indirect ownership or
incidence of ownership of or with respect to any Shares or Warrants. All rights,
ownership and economic benefits of and relating to the Shares and the Warrants
shall remain vested in and belong to the Stockholders, and Washington Mutual
shall have no authority to manage, direct, superintend, restrict, regulate,
govern, or administer any of the policies or operations of Dime or exercise any
power or authority to direct the Stockholders in the voting of any of the
Shares, except as otherwise provided herein.
5.5. Notices. All notices and other communications hereunder shall be
in writing and shall be deemed given if delivered personally, telecopied (with
confirmation) or delivered by an overnight courier (with confirmation) to the
parties at the following addresses (or at such other address for a party as
shall be specified by like notice):
(a) if to Washington Mutual to:
Washington Mutual, Inc.
1201 Third Avenue WMT 1501
Seattle, Washington 98101
Fax: (206) 461-5739
Attention: Craig E. Tall
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with a copy to:
Simpson Thacher & Bartlett
425 Lexington Avenue
New York, New York 10017
Fax: (212) 455-2502
Attention: Lee Meyerson, Esq.
Brian Stadler, Esq.
(b) if to the Stockholders to:
Warburg, Pincus Equity Partners, L.P.
466 Lexington Avenue
New York, New York 10017
Fax: (212) 599-5617
Attention: Kewsong Lee
with a copy to:
Wachtell, Lipton, Rosen & Katz
51 W. 52nd St.
New York, New York 10019
Fax: (212) 403-2000
Attention: Andrew R. Brownstein, Esq.
5.6. Interpretation
The words "hereof," "herein" and "hereunder" and words of similar
import when used in this Agreement shall refer to this Agreement as a whole and
not to any particular provision of this Agreement, and Section references are to
this Agreement unless otherwise specified. Whenever the words "include,"
"includes" or "including" are used in this Agreement, they shall be deemed to be
followed by the words "without limitation." The headings contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement. No provision of this Agreement
shall be construed to require Washington Mutual, the Stockholders or any of
their respective Subsidiaries or affiliates to take any action which would
violate or conflict with any applicable law (whether statutory or common), rule
or regulation.
5.7. 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 both
parties need not sign the same counterpart.
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5.8. Entire Agreement. This Agreement (together with the Merger
Agreement, to the extent referred to herein) constitutes the entire agreement
and supersedes all prior agreements and understandings, both written and oral,
between the parties with respect to the subject matter hereof.
5.9. Governing Law. This Agreement shall be governed and construed in
accordance with the laws of the State of New York applicable to contracts made
and performed entirely within such State. The parties hereby irrevocably submit
to the jurisdiction of the courts of the State of New York and the Federal
courts of the United States of America located in the State of New York solely
in respect of the interpretation and enforcement of the provisions of this
Agreement and in respect of the transactions contemplated hereby, and hereby
waive, and agree not to assert, as a defense in any action, suit or proceeding
for the interpretation or enforcement hereof, that it is not subject thereto or
that such action, suit or proceeding may not be brought or is not maintainable
in said courts or that the venue thereof may not be appropriate or that this
Agreement may not be enforced in or by such courts, and the parties hereto
irrevocably agree that all claims with respect to such action or proceeding
shall be heard and determined in such a New York State or Federal court. The
parties hereby consent to and grant any such court jurisdiction over the person
of such parties and over the subject matter of such dispute (solely for purposes
of this Section 5.9 with respect to matters involving this Agreement and the
transactions provided for herein) and agree that mailing of process or other
papers in connection with any such action or proceeding in the manner provided
in Section 5.5 or in such other manner as may be permitted by law shall be valid
and sufficient service thereof.
5.10. Amendment. This Agreement may not be amended except by an
instrument in writing signed on behalf of each of the parties hereto.
5.11. Enforcement. The parties agree that irreparable damage would
occur in the event that any of the provisions of this Agreement were not
performed in accordance with their specific terms. It is accordingly agreed that
the parties shall be entitled to specific performance of the terms hereof, this
being in addition to any other remedy to which they are entitled at law or in
equity. Each of the parties further agrees to waive any requirements for the
securing or posting of any bond in connection with obtaining any such equitable
relief.
5.12. Severability. Any term or provision of this Agreement which is
determined by a court of competent jurisdiction to be invalid or unenforceable
in any jurisdiction shall, as to that jurisdiction, be ineffective to the extent
of such invalidity or unenforceability without rendering invalid or
unenforceable the remaining terms and provisions of this Agreement or affecting
the validity or enforceability of any of the terms or provisions of this
Agreement in any other jurisdiction, and if any provision of this Agreement is
determined to be so broad as to be unenforceable, the provision shall be
interpreted to be only so broad as is enforceable, in all cases so long as
neither the economic nor legal substance of the transactions contemplated hereby
is affected in any manner materially adverse to any party or its stockholders or
limited partners. Upon any such determination, the parties shall negotiate in
good faith in an effort to agree upon a suitable and equitable substitute
provision to effect the original intent of the parties.
5.13. Assignment; Third Party Beneficiaries. Neither this Agreement nor
any of the rights, interests or obligations of any party hereunder shall be
assigned by any of the parties hereto
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(whether by operation of law or otherwise) without the prior written consent of
the other party. Subject to the preceding sentence, this Agreement will be
binding upon, inure to the benefit of and be enforceable by the parties and
their respective successors and permitted assigns. This Agreement is not
intended to confer upon any person other than the parties hereto any rights or
remedies hereunder.
5.14. Release. Subject to the consummation of the Warrant Purchase,
each Stockholder, on behalf of itself and its affiliates, hereby releases and
discharges, and indemnifies and holds harmless, Dime and its affiliates and
their successors (including Washington Mutual as successor to Dime) and assigns
from all actions, cause of action, claims and demands arising out of or relating
to the Investment Agreement or the Letter Agreement.
5.15. Joint and Several Nature of Agreement. All representations,
warranties, covenants and agreements of any Stockholder contained in this
Agreement shall be deemed to be joint and several representations, warranties,
covenants and agreements of all of the Stockholders.
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IN WITNESS WHEREOF, Washington Mutual and the Stockholders
have each caused this Agreement to be signed by their respective officers or
other authorized person thereunto duly authorized as of the date first written
above.
WARBURG, PINCUS EQUITY PARTNERS, L.P.
By: WARBURG, PINCUS & CO., its General Partner
/s/ Kewsong Lee
By: _____________________________________
Name: Kewsong Lee
Title: Partner
WARBURG, PINCUS Netherlands EQUITY PARTNERS I, C.V.
By: WARBURG, PINCUS & CO., its General Partner
/s/ Kewsong Lee
By: _____________________________________
Name: Kewsong Lee
Title: Partner
WARBURG, PINCUS Netherlands EQUITY PARTNERS II, C.V.
By: WARBURG, PINCUS & CO., its General Partner
/s/ Kewsong Lee
By: _____________________________________
Name: Kewsong Lee
Title: Partner
WARBURG, PINCUS Netherlands EQUITY PARTNERS III,
C.V.
By: WARBURG, PINCUS & CO., its General Partner
/s/ Kewsong Lee
By: _____________________________________
Name: Kewsong Lee
Title: Partner
WASHINGTON MUTUAL, INC.
/s/ Craig E. Tall
By: _____________________________________
Name: Craig E. Tall
Title: Vice Chairman
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