EXHIBIT 4.1
STOCK OPTION AGREEMENT
STOCK OPTION AGREEMENT, dated as of January 19, 1998 (the
"Agreement"), between The St. ▇▇▇▇ Companies, Inc., a Minnesota corporation
(the "Grantee"), and USF&G Corporation, a Maryland corporation (the "Grantor").
WHEREAS, the Grantee, SP Merger Corporation, a Maryland
corporation and a wholly owned subsidiary of the Grantee ("Newco"), and the
Grantor are entering into an Agreement and Plan of Merger, dated as of the
date hereof (the "Merger Agreement"), which provides, among other things, for
the merger of the Newco with and into Grantor (the "Merger");
WHEREAS, as a condition and inducement to Grantee's and
Newco's willingness to enter into the Merger Agreement, the Grantee and Newco
have requested that the Grantor grant to the Grantee an option to purchase up
to shares of Common Stock, par value $2.50 per share, of the Grantor
(the "Common Stock"), upon the terms and subject to the conditions hereof; and
WHEREAS, in order to induce the Grantee and Newco to enter
into the Merger Agreement, the Grantor is willing to grant the Grantee the
requested option.
NOW, THEREFORE, in consideration of the premises and the
mutual covenants and agreements set forth herein, the parties hereto agree as
follows:
1. The Option; Exercise ; Adjustments; Payment of
Spread. (a) Contemporaneously herewith the Grantee, Newco and the Grantor
are entering into the Merger Agreement. Subject to the other terms and
conditions set forth herein, the Grantor hereby grants to the Grantee an
irrevocable option (the "Option") to purchase up to 23,181,596 shares of
Common Stock (the "Shares") at a cash purchase price equal to $22.00 per
share (the "Purchase Price"). The Option may be exercised by the Grantee,
in whole or in part, at any time, or from time to time, following (but not
prior to) the occurrence of one of the events set forth in Section 2(d)
hereof, and prior to the termination of the Option in accordance with the
terms of this Agreement.
(b) In the event the Grantee wishes to exercise the Option,
the Grantee shall send a written notice to the Grantor (the "Stock Exercise
Notice") specifying a date (subject to the HSR Act (as defined below) and
applicable insurance regulatory approvals) not later than 10 business days and
not earlier than three business days following the date such notice is given
for the closing of such purchase. In the event of any change in the number of
issued and outstanding shares of Common Stock by reason of any stock dividend,
stock split, split-up, recapitalization, merger or other change in the
corporate or capital structure of the Grantor, the number of Shares subject to
this Option and the purchase price per Share shall be appropriately adjusted
to restore the Grantee to its rights hereunder, including its right to
purchase Shares representing 19.9% of the capital stock of the Grantor
entitled to vote generally for the election of the directors of the Grantor
which is issued and outstanding immediately prior to the exercise of the
Option.
(c) If at any time the Option is then exercisable pursuant
to the terms of Section 1(a) hereof, the Grantee may elect, in lieu of
exercising the Option to purchase Shares provided in Section 1(a) hereof, to
send a written notice to the Grantor (the "Cash Exercise Notice") specifying a
date not later than 20 business days and not earlier than 10 business days
following the date such notice is given on which date the Grantor shall pay to
the Grantee an amount in cash equal to the Spread (as hereinafter defined)
multiplied by all or such portion of the Shares subject to the Option as
Grantee shall specify. As used herein "Spread" shall mean the excess, if any,
over the Purchase Price of the higher of (x) if applicable, the highest price
per share of Common Stock (including any brokerage commissions, transfer taxes
and soliciting dealers' fees) paid or proposed to be paid by any person
pursuant to any Company Acquisition Proposal (as defined in the Merger
Agreement) (the "Alternative Purchase Price") or (y) the closing price of the
shares of Common Stock on the NYSE Composite Tape on the last trading day
immediately prior to the date of the Cash Exercise Notice (the "Closing
Price"). If the Alternative Purchase Price includes any property other than
cash, the Alternative Purchase Price shall be the sum of (i) the fixed cash
amount, if any, included in the Alternative Purchase Price plus (ii) the fair
market value of such other property. If such other property consists of
securities with an existing public trading market, the average of the closing
prices (or the average of the closing bid and asked prices if closing prices
are unavailable) for such securities in their principal public trading market
on the five trading days ending five days prior to the date of the Cash
Exercise Notice shall be deemed to equal the fair market value of such
property. If such other property consists of something other than cash or
securities with an existing public trading market and, as of the payment date
for the Spread, agreement on the value of such other property has not been
reached, the Alternative Purchase Price shall be deemed to equal the Closing
Price. Upon exercise of its right to receive cash pursuant to this Section
1(c), the obligations of the Grantor to deliver Shares pursuant to Section 3
shall be terminated with respect to such number of Shares for which the Grantee
shall have elected to be paid the Spread.
2. Conditions to Delivery of Shares. The Grantor's
obligation to deliver Shares upon exercise of the Option is subject only to
the conditions that:
(a) No preliminary or permanent injunction or other order
issued by any federal or state court of competent jurisdiction in
the United States prohibiting the delivery of the Shares shall be
in effect; and
(b) Any applicable waiting periods under the
▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements Act of ▇▇▇▇ (▇▇▇ "▇▇▇
▇▇▇") shall have expired or been terminated; and
(c) Any approval required to be obtained prior to the
delivery of the Shares under the insurance laws of any state or
foreign jurisdiction shall have been obtained and be in full force
and effect; and
(d) (i) any person (other than Grantee or any of its
subsidiaries) shall have acquired beneficial ownership (as such
term is defined in Rule 13d-3 under the Exchange Act) or the right
to acquire beneficial ownership of, or any "group" (as such term is
defined under the Exchange Act) shall have been formed which
beneficially owns or has the right to acquire beneficial ownership
of, shares of Common Stock (other than trust account shares)
aggregating 15 percent or more of the then outstanding Common
Stock; (ii) in the event a Company Acquisition Proposal shall have
been made to Grantor or any of its Subsidiaries or any of its
stockholders or any person shall have publicly announced an
intention (whether or not conditional) to make a Company
Acquisition Proposal with respect to Grantor or any of its
Subsidiaries and thereafter the Merger Agreement is terminated by
either Grantor or Grantee pursuant to Section 8.2(ii) of the Merger
Agreement; (iii) the Merger Agreement is terminated by Grantor
pursuant to Section 8.3(a) of the Merger Agreement; (iv) the Merger
Agreement is terminated by Grantee pursuant to Section 8.4(a) of
the Merger Agreement; or (v) Grantor shall have delivered to
Grantee the written notification pursuant to Section 8.3(a)(i
ii) of the Merger Agreement and Grantee shall have notified
Grantor in writing that Grantee does not intend to match the
Superior Proposal (as defined in the Merger Agreement) referred
to in such notification. As used in this Agreement, "person"
shall have the meaning specified in Sections 3(a)(9) and
13(d)(3) of the Exchange Act.
3. The Closing. (a) Any closing hereunder shall take
place on the date specified by the Grantee in its Stock Exercise Notice or
Cash Exercise Notice, as the case may be, at 9:00 A.M., local time, at the
offices of ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, 125 Broad Street, New York, New York, or, if
the conditions set forth in Section 2(a), (b) or (c) have not then been
satisfied, on the second business day following the satisfaction of such
conditions, or at such other time and place as the parties hereto may agree
(the "Closing Date"). On the Closing Date, (i) in the event of a closing
pursuant to Section 1(b) hereof, the Grantor will deliver to the Grantee a
certificate or certificates, representing the Shares in the denominations
designated by the Grantee in its Stock Exercise Notice and the Grantee will
purchase such Shares from the Grantor at the price per Share equal to the
Purchase Price or (ii) in the event of a closing pursuant to Section 1(c)
hereof, the Grantor will deliver to the Grantee cash in an amount determined
pursuant to Section 1(c) hereof. Any payment made by the Grantee to the
Grantor, or by the Grantor to the Grantee, pursuant to this Agreement shall
be made by certified or official bank check or by wire transfer of federal
funds to a bank designated by the party receiving such funds.
(b) The certificates representing the Shares shall bear an
appropriate legend relating to the fact that such Shares have not been
registered under the Securities Act of 1933, as amended (the "Securities Act").
4. Representations and Warranties of the Grantor. The
Grantor represents and warrants to the Grantee that (a) the Grantor is a
corporation duly organized, validly existing and in good standing under the
laws of the State of Maryland and has the requisite corporate power and
authority to enter into and perform this Agreement; (b) the execution and
delivery of this Agreement by the Grantor and the consummation by it of the
transactions contemplated hereby have been duly authorized by the Board of
Directors of the Grantor and this Agreement has been duly executed and
delivered by a duly authorized officer of the Grantor and constitutes a valid
and binding obligation of the Grantor, enforceable in accordance with its
terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or affecting
creditors' rights and to general equity principles; (c) the Grantor has taken
all necessary corporate action to authorize and reserve the Shares issuable
upon exercise of the Option and the Shares, when issued and delivered by the
Grantor upon exercise of the Option and paid for by Grantee as contemplated
hereby, will be duly authorized, validly issued, fully paid and non-assessable
and free of preemptive rights; (d) except as otherwise required by the HSR Act
and applicable insurance laws, the execution and delivery of this Agreement by
the Grantor and the consummation by it of the transactions contemplated hereby
do not require the consent, waiver, approval or authorization of or any filing
with any person or public authority and will not violate, result in a breach
of or the acceleration of any obligation under, or constitute a default under,
any provision of Grantor's charter or by-laws, or any material indenture,
mortgage, lien, lease, agreement, contract, instrument, order, law, rule,
regulation, judgment, ordinance, or decree, or restriction by which the
Grantor or any of its subsidiaries or any of their respective properties or
assets is bound; (e) no "fair price", "moratorium", "control share
acquisition," "interested shareholder" or other form of antitakeover statute
or regulation, including without limitation, Sections 3-602 of the Maryland
General Corporation Law, or similar provision contained in the charter or
by-laws of Grantor, is or shall be applicable to the acquisition of Shares
pursuant to this Agreement; and (f) the Grantor has taken all corporate action
necessary so that any Shares acquired pursuant to this Agreement shall not be
counted for purposes of determining the number of shares of Common Stock
beneficially owned by the Grantee or any of its Affiliates or Associates (as
such terms are defined in the Rights Agreement) pursuant to the Amended and
Restated Rights Agreement, dated as of March 11, 1997, between Grantor and The
Bank of New York, as Rights Agent (the "Rights Agreement").
5. Representations and Warranties of the Grantee. The
Grantee represents and warrants to the Grantor that (a) the execution and
delivery of this Agreement by the Grantee and the consummation by it of the
transactions contemplated hereby have been duly authorized by all necessary
corporate action on the part of the Grantee and this Agreement has been duly
executed and delivered by a duly authorized officer of the Grantee and
constitutes a valid and binding obligation of Grantee; and (b) the Grantee is
acquiring the Option and, if and when it exercises the Option, will be
acquiring the Shares issuable upon the exercise thereof for its own account and
not with a view to distribution or resale in any manner which would be in
violation of the Securities Act.
6. Listing of Shares; Filings; Governmental Consents.
Subject to applicable law and the rules and regulations of the New York Stock
Exchange, Inc. (the "NYSE"), after the Option becomes exercisable hereunder,
the Grantor will promptly file an application to list the Shares on the NYSE
and will use its reasonable best efforts to obtain approval of such listing
and to effect all necessary filings by the Grantor under the HSR Act and the
applicable insurance laws of each state and foreign jurisdiction; provided,
however, that if the Grantor is unable to effect such listing on the NYSE by
the Closing Date, the Grantor will nevertheless be obligated to deliver the
Shares upon the Closing Date. Each of the parties hereto will use its
reasonable best efforts to obtain consents of all third parties and
governmental authorities, if any, necessary to the consummation of the
transactions contemplated.
7. Repurchase of Shares. If by the date that is the first
anniversary of the date the Merger Agreement was terminated pursuant to the
terms thereof (the "Merger Termination Date"), neither the Grantee nor any
other Person has acquired more than fifty percent (excluding the Shares) of the
shares of outstanding Common Stock, then the Grantor has the right to purchase
(the "Repurchase Right") all, but not less than all, of the Shares acquired
upon exercise of this Option at the greater of (i) the Purchase Price or (ii)
the average of the last sales prices for shares of Common Stock on the five
trading days ending five days prior to the date the Grantor gives written
notice of its intention to exercise the Repurchase Right. If the Grantor does
not exercise the Repurchase Right within thirty days following the end of the
one year period after the Merger Termination Date, the Repurchase Right
lapses. In the event the Grantor wishes to exercise the Repurchase Right, the
Grantor shall send a written notice to the Grantee specifying a date (not
later than 20 business days and not earlier than 10 business days following
the date such notice is given) for the closing of such purchase.
8. Sale of Shares. At any time prior to the first
anniversary of the Merger Termination Date, the Grantee shall have the right
to sell (the "Sale Right") to the Grantor all, but not less than all, of the
Shares acquired upon exercise of this Option at the greater of (i) the
Purchase Price, or (ii) the average of the last sales prices for shares of
Common Stock on the five trading days ending five days prior to the date the
Grantee gives written notice of its intention to exercise the Sale Right. If
the Grantee does not exercise the Sale Right prior to the first anniversary of
the Merger Termination Date, the Sale Right terminates. In the event the
Grantee wishes to exercise the Sale Right, the Grantee shall send a written
notice to the Grantor specifying a date not later than 20 business days and
not earlier than 10 business days following the date such notice is given for
the closing of such sale.
9. Registration Rights. (a) In the event that the Grantee
shall desire to sell any of the Shares within three years after the purchase
of such Shares pursuant hereto, and such sale requires, in the opinion of
counsel to the Grantee, which opinion shall be reasonably satisfactory to the
Grantor and its counsel, registration of such Shares under the Securities Act,
the Grantor will cooperate with the Grantee and any underwriters in
registering such Shares for resale, including, without limitation, promptly
filing a registration statement which complies with the requirements of
applicable federal and state securities laws, and entering into an underwriting
agreement with such underwriters upon such terms and conditions as are
customarily contained in underwriting agreements with respect to secondary
distributions; provided that the Grantor shall not be required to have
declared effective more than two registration statements hereunder and shall be
entitled to delay the filing or effectiveness of any registration statement
for up to 120 days if the offering would, in the judgment of the Board of
Directors of the Grantor, require premature disclosure of any material
corporate development or material transaction involving the Grantor or
interfere with any previously planned securities offering by the Company.
(b) If the Common Stock is registered pursuant to the
provisions of this Section 9, the Grantor agrees (i) to furnish copies of the
registration statement and the prospectus relating to the Shares covered
thereby in such numbers as the Grantee may from time to time reasonably request
and (ii) if any event shall occur as a result of which it becomes necessary to
amend or supplement any registration statement or prospectus, to prepare and
file under the applicable securities laws such amendments and supplements as
may be necessary to keep available for at least 45 days a prospectus covering
the Common Stock meeting the requirements of such securities laws, and to
furnish the Grantee such numbers of copies of the registration statement and
prospectus as amended or supplemented as may reasonably be requested. The
Grantor shall bear the cost of the registration, including, but not limited
to, all registration and filing fees, printing expenses, and fees and
disbursements of counsel and accountants for the Grantor, except that the
Grantee shall pay the fees and disbursements of its counsel, and the
underwriting fees and selling commissions applicable to the shares of Common
Stock sold by the Grantee. The Grantor shall indemnify and hold harmless (i)
Grantee, its affiliates and its officers and directors and (ii) each
underwriter and each person who controls any underwriter within the meaning
of the Securities Act or the Securities Exchange Act of 1934, as amended
(collectively, the "Underwriters") ((i) and (ii) being referred to as
"Indemnified Parties") against any losses, claims, damages, liabilities or
expenses, to which the Indemnified Parties may become subject, insofar as such
losses, claims, damages, liabilities (or actions in respect thereof) and
expenses arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained or incorporated by reference in any
registration statement filed pursuant to this paragraph, or arise out of or
are based upon the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements therein
not misleading; provided, however, that the Grantor will not be liable in any
such case to the extent that any such loss, liability, claim, damage or expense
arises out of or is based upon an untrue statement or alleged untrue statement
in or omission or alleged omission from any such documents in reliance upon
and in conformity with written information furnished to the Grantor by the
Indemnified Parties expressly for use or incorporation by reference therein.
(c) The Grantee and the Underwriters shall indemnify and
hold harmless the Grantor, its affiliates and its officers and directors
against any losses, claims, damages, liabilities or expenses to which the
Grantor, its affiliates and its officers and directors may become subject,
insofar as such losses, claims, damages, liabilities (or actions in respect
thereof) and expenses arise out of or are based upon any untrue statement
of any material fact contained or incorporated by reference in any
registration statement filed pursuant to this paragraph, or arise out of or
are based upon the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements
therein not misleading, in each case to the extent, but only to the extent,
that such untrue statement or alleged untrue statement or omission or
alleged omission was made in reliance upon and in conformity with written
information furnished to the Grantor by the Grantee or the Underwriters, as
applicable, specifically for use or incorporation by reference therein.
10. Expenses. Each party hereto shall pay its own expenses
incurred in connection with this Agreement, except as otherwise specifically
provided herein.
11. Specific Performance. The Grantor acknowledges that if
the Grantor fails to perform any of its obligations under this Agreement
immediate and irreparable harm or injury would be caused to the Grantee for
which money damages would not be an adequate remedy. In such event, the
Grantor agrees that the Grantee shall have the right, in addition to any other
rights it may have, to specific performance of this Agreement. Accordingly,
if the Grantee should institute an action or proceeding seeking specific
enforcement of the provisions hereof, the Grantor hereby waives the claim or
defense that the Grantee has an adequate remedy at law and hereby agrees not
to assert in any such action or proceeding the claim or defense that such a
remedy at law exists. The Grantor further agrees to waive any requirements
for the securing or posting of any bond in connection with obtaining any such
equitable relief.
12. Notice. All notices, requests, demands and other
communications hereunder shall be deemed to have been duly given and made if
in writing and if served by personal delivery upon the party for whom it is
intended or delivered by registered or certified mail, return receipt
requested, or if sent by facsimile transmission, upon receipt of oral
confirmation that such transmission has been received, to the person at the
address set forth below, or such other address as may be designated in writing
hereafter, in the same manner, by such person:
If to the Grantee:
The St. ▇▇▇▇ Companies, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇. ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Chief Executive Officer
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to:
▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Grantor:
USF&G Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Chief Executive Officer
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to:
▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
13. Parties in Interest. This Agreement shall inure to the
benefit of and be binding upon the parties named herein and their respective
successors and assigns; provided, however, that such successor in interest or
assigns shall agree to be bound by the provisions of this Agreement. Nothing
in this Agreement, express or implied, is intended to confer upon any person
other than the Grantor or the Grantee, or their successors or assigns, any
rights or remedies under or by reason of this Agreement.
14. Entire Agreement; Amendments. This Agreement, together
with the Merger Agreement and the other documents referred to therein,
contains the entire agreement between the parties hereto with respect to the
subject matter hereof and supersedes all prior and contemporaneous agreements
and understandings, oral or written, with respect to such transactions. This
Agreement may not be changed, amended or modified orally, but may be changed
only by an agreement in writing signed by the party against whom any waiver,
change, amendment, modification or discharge may be sought.
15. Assignment. No party to this Agreement may assign any
of its rights or obligations under this Agreement without the prior written
consent of the other party hereto, except that the Grantee may assign its
rights and obligations hereunder to any of its direct or indirect wholly owned
subsidiaries (including Newco), but no such transfer shall relieve the Grantee
of its obligations hereunder if such transferee does not perform such
obligations.
16. Headings. The section headings herein are for
convenience only and shall not affect the construction of this Agreement.
17. Counterparts. This Agreement may be executed in any
number of counterparts, each of which, when executed, shall be deemed to be an
original and all of which together shall constitute one and the same document.
18. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Maryland(regardless of
the laws that might otherwise govern under applicable Maryland principles of
conflicts of law).
19. Termination. The right to exercise the Option granted
pursuant to this Agreement shall terminate at the earliest of (i) the
Effective Time (as defined in the Merger Agreement) (ii) if the Option is not
exercised within 60 days after first becoming exercisable and (iii) if not then
exercisable, thirty days after termination of the Merger Agreement in
accordance with its terms (the dates referred to in clause (ii) and (iii) being
hereinafter referred to as the "Termination Date"); provided that, if the
Option cannot be exercised or the Shares cannot be delivered to Grantee upon
such exercise because the conditions set forth in Section 2(a), (b) or (c)
hereof have not yet been satisfied, the Termination Date shall be extended
until thirty days after such impediment to exercise or delivery has been
removed.
All representations and warranties contained in this
Agreement shall survive delivery of and payment for the Shares.
20. Profit Limitation. (a) Notwithstanding any other
provision of this Agreement or the Merger Agreement, in no event shall the
Grantee's Total Profit (as hereinafter defined) exceed $75 million and, if
it otherwise would exceed such amount, the Grantee, shall repay such excess
amount to Grantor in cash (or the purchase price for purposes of Section 7
or 8, as applicable, shall be reduced) so that Grantee's Total Profit shall
not exceed $75 million after taking into account the foregoing actions.
Notwithstanding any other provision of this Agreement, this
Option may not be exercised for a number of Shares as would, as of the date of
the Stock Exercise Notice, result in a Notional Total Profit (as defined
below) of more than $75 million and, if exercise of the Option otherwise would
exceed such amount, the Grantee, at its discretion, may increase the Purchase
Price for that number of Shares set forth in the Stock Exercise Notice so that
the Notional Total Profit shall not exceed $75 million; provided, that nothing
in this sentence shall restrict any exercise of the Option permitted hereby on
any subsequent date at the Purchase Price set forth in Section 1(a) hereof.
As used herein, the term "Total Profit" shall mean the
aggregate amount (before taxes) of the following: (i) (x) the amount of cash
received by Grantee pursuant to Section 8.5 of the Merger Agreement and
Section 1(c) hereof, less (y) any repayment of such cash to Grantor, (ii) (x)
the amount received by Grantee pursuant to the Grantor's repurchase of Shares
pursuant to Sections 7 or 8 hereof, less (y) the Grantee's purchase price for
such Shares, and (iii) (x) the net cash amounts received by Grantee pursuant to
the sale of Shares (or any other securities into or for which such Shares are
converted or exchanged) to any unaffiliated party, less (y) the Grantee's
purchase price for such Shares.
As used herein, the term "Notional Total Profit" with
respect to any number of Shares as to which Grantee may propose to exercise
this Option shall be the Total Profit determined as of the date of the Stock
Exercise Notice assuming that this Option were exercised on such date for such
number of Shares and assuming that such Shares, together with all other Shares
acquired upon exercise of the Option and held by Grantee and its affiliates as
of such date, were sold for cash at the closing market price for the Common
Stock as of the close of business on the preceding trading day (less customary
brokerage commissions).
21. Severability. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction to
be invalid, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions of this Agreement shall remain in full force and
effect and shall in no way be affected, impaired or invalidated.
22. Public Announcement. The initial press release
referring to this Option shall be a joint press release in the form previously
agreed by Grantor and Grantee and thereafter the Grantee and the Grantor shall
consult with each other prior to issuing, and will provide each other with a
meaningful opportunity to review, comment upon and concur with, any press
releases or otherwise making public announcements with respect to the Option
and prior to making any filings with any third party and/or Governmental
Entity (as defined in the Merger Agreement) (including any national securities
exchange) with respect thereto, except as may be required by law, court
process or by obligations pursuant to any listing agreement with or rules of
any national securities exchange or interdealer quotation system.
IN WITNESS WHEREOF, the Grantee and the Grantor have caused
this Agreement to be duly executed and delivered on the day and year first
above written.
USF&G CORPORATION
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
Title: Chairman of the Board, President
and Chief Executive Officer
THE ST. ▇▇▇▇ COMPANIES, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
Title: Chairman of the Board, President
and Chief Executive Officer