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EXHIBIT 2.2
STOCK OPTION AGREEMENT
STOCK OPTION AGREEMENT (the "Agreement"), dated as of May 31,
1999, by and between, E*TRADE Group, Inc., a Delaware corporation ("Parent"),
and Telebanc Financial Corporation, a Delaware corporation ("Company").
Capitalized terms used herein but not defined herein shall have the meanings
set forth in the Reorganization Agreement referred to below.
WHEREAS, concurrently with the execution and delivery of this
Agreement, Company, Parent and Turbo Acquisition Corp., a Delaware corporation
and wholly-owned subsidiary of Parent ("Merger Sub"), are entering into an
Agreement and Plan of Merger and Reorganization, dated as of the date hereof
(the "Reorganization Agreement"), pursuant to which, among other things, upon
the terms and subject to the conditions thereof, Merger Sub will be merged with
and into Company (the "Merger"), with Company continuing as the surviving
corporation; and
WHEREAS, as a condition and inducement to Parent's willingness
to enter into the Reorganization Agreement, Parent has required that Company
agree, and Company has agreed, to grant to Parent an option to purchase certain
newly issued shares of Company's Common Stock, par value $.01 per share
("Company Common Stock"), upon the terms and subject to the conditions set
forth herein;
NOW, THEREFORE, in consideration of the foregoing and of the
mutual covenants and agreements set forth herein and in the Reorganization
Agreement, the parties hereto agree as follows:
1. Grant of Option. Company hereby grants to Parent an
irrevocable option (the "Company Option") to purchase up to 3,369,881 shares
(the "Company Shares") of Company Common Stock" in the manner set forth below
at a price (the "Exercise Price") of $93.45 per Company Share, payable in cash.
2. Exercise of Option. (a) The Company Option may be
exercised by Parent, in whole or in part at any time or from time to time after
(i) the occurrence of any of the events described in Section 7.3(b) of the
Reorganization Agreement or (ii) immediately prior to the occurrence of any of
the events which obligate Company to pay Parent the Termination Fee pursuant to
section 7.3(c) of the Reorganization Agreement. In the event Parent wishes to
exercise the Company Option, Parent shall deliver to Company a written notice
(an "Exercise Notice") specifying the total number of Company Shares it wishes
to purchase; provided that, if prior notification to or approval of the Office
of Thrift Supervision (the "OTS") or any other regulatory or antitrust agency
is required in connection with such purchase, Parent shall promptly file the
required notice or application for approval, shall promptly notify Company of
such filing, and shall expeditiously process the same and the period of time
that otherwise would run pursuant to this sentence shall run instead from the
date on which any required notification periods have expired or been terminated
or such approvals have been obtained and any requisite waiting period or
periods shall have passed. Each closing of a purchase of Company Shares (an
"Option Closing") shall occur at a place, on a date and at a time designated by
Parent in an Exercise Notice delivered at least two business days prior to the
date of the Option Closing. The
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Company Option shall terminate upon the earlier of: (w) the Effective Time;
(x) the termination of the Reorganization Agreement pursuant to Section 7.1
thereof (other than a termination in connection with which Parent is entitled
to any payments as specified in Sections 7.3(b) or (c) thereof); (y) 180 days
following any termination of the Reorganization Agreement in connection with
which Parent is entitled to a payment as specified in Section 7.3(b) thereof
(or if, at the expiration of such 180 day period, the Company Option cannot be
exercised by reason of any applicable judgment, decree, order, law or
regulation, twenty (20) business days after such impediment to exercise shall
have been removed or shall have become final and not subject to appeal); or (z)
180 days following the occurrence of any event in connection with which Parent
has become entitled to payment of the Termination Fee pursuant to Section
7.3(c) of the Reorganization Agreement (or if, at the expiration of such 180
day period, the Company Option cannot be exercised by reason of any applicable
judgment, decree, order, law or regulation, twenty (20) business days after
such impediment to exercise shall have been removed or shall have become final
and not subject to appeal).
(b) Notwithstanding any other provision of this Agreement or the
Reorganization Agreement, in no event shall Parent's Total Profit (as
hereinafter defined) exceed in the aggregate $90,000,000 and, if it otherwise
would exceed such amount Parent, in its sole discretion, shall either (i)
reduce the number of Company Shares subject to the Company Option, (ii) pay
cash to Company, (iii) receive a smaller Termination Fee (as defined in Section
7.3(b) of the Reorganization Agreement) or (iv) any combination thereof, so
that Parent's actually realized Total Profit shall not exceed in the aggregate
$90,000,000 after taking into account the foregoing actions.
(c) As used herein, the term "Total Profit" shall mean the sum of
(i) (x) the amount (before taxes but net of reasonable and customary
commissions paid or payable in connection with such transaction) received by
parent pursuant to the sale of Company Shares less (y) Parent's purchase price
for such Company Shares, (ii) any amounts (before taxes but net of reasonable
and customary commissions paid or payable in connection with such transaction)
received by parent on the transfer of the Company Option (or any portion
thereof) to any unaffiliated Person(s) (if permitted hereunder) or to Company
and (iii) the amount received by Parent pursuant to Section 7.3(b) or Section
7.3(c) of the Reorganization Agreement.
3. Conditions to Closing. The obligation of Company to
issue the Company Shares to Parent hereunder is subject to the conditions that
(i) all consents, approvals, orders or authorizations of, or registrations,
declarations or filings with, any Governmental Entity or Regulatory Entity if
any, required in connection with the issuance of the Company Shares hereunder
shall have been obtained or made, as the case may be; and (ii) no preliminary
or permanent injunction or other order by any court of competent jurisdiction
prohibiting or otherwise restraining such issuance shall be in effect.
4. Closing. At each Option Closing, (a) Company will
deliver to Parent a certificate or certificates in definitive form representing
the number of Company Shares designated by Parent in its Exercise Notice, such
certificate or certificates to be registered in the name of Parent or its
designee and to bear the legend set forth in Section 10, and (b) Parent will
deliver to Company the aggregate Exercise Price for the Company Shares so
designated by wire transfer of immediately available funds or certified check
or bank check. At any Option Closing
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at which Parent is exercising the Company Option in part, Parent shall present
and surrender this Agreement to Company, and Company shall deliver to Parent an
executed new agreement with the same terms as this Agreement evidencing the
right to purchase the remaining balance of the shares of Company Common Stock
purchasable hereunder.
5. Representations and Warranties of 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
Delaware 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 the consummation by Company of the transactions
contemplated hereby have been duly authorized by all necessary corporate action
on the part of 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 constitutes a valid and binding obligation of Company, enforceable
against Company in accordance with its terms, except as such enforceability may
be limited by bankruptcy and other laws affecting the rights and remedies of
creditors generally and general principles of equity, (d) Company has taken all
action necessary to authorize and reserve for issuance and to permit it to
issue, upon exercise of the Company Option, and at all times from the date
hereof through the expiration of the Company Option will have reserved, that
number of unissued Company Shares that are subject to the Company Option, all
of which, upon their issuance and delivery in accordance with the terms of this
Agreement, will be validly issued, fully paid and nonassessable, (e) upon
delivery of the Company Shares to Parent upon the exercise of the Company
Option, Parent will acquire the Company Shares free and clear of all liens,
claims, charges, encumbrances and security interests of any nature whatsoever
except those imposed by Parent, (f) assuming that the consents approvals,
authorizations, permits, filings and notifications referred to in subsection
(g) are obtained or made, as applicable, the execution and delivery of this
Agreement by Company does not, and the performance of this Agreement by Company
will not, conflict with, or result in any violation of, or default (with or
without notice or lapse of time, or both) under, or give rise to a right of
termination, cancellation or acceleration of any obligation or the loss of a
benefit under, or the creation of a lien, pledge, security interest or other
encumbrance on assets pursuant to (any such conflict, violation, default, right
of termination, cancellation or acceleration, loss or creation, a "Violation"),
(A) any provision of the Amended and Restated Certificate of Incorporation or
By-laws, each as amended, of Company or (B) any provisions of any material
mortgage, indenture, lease, contract or other agreement, instrument, permit,
concession, franchise, or license or (C) any judgment, order, decree, statute,
law, ordinance, rule or regulation applicable to Company or its properties or
assets, except in the case of clauses (B) and (C) immediately above, for
violations which would not, individually or in the aggregate, have a Material
Adverse Effect on Company and (g) except as described in Section 2.3 of the
Reorganization Agreement, 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 or Regulatory Entity.
6. Representations and Warranties of Parent. Parent
represents and warrants to Company that (a) Parent is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware 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
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Agreement by Parent and the consummation by Parent of the transactions
contemplated hereby have been duly authorized by all necessary corporate action
on the part of Parent and no other corporate proceedings on the part of Parent
are necessary to authorize this Agreement or any of the transactions
contemplated hereby, (c) this Agreement has been duly executed and delivered by
Parent and constitutes a valid and binding obligation of Parent, enforceable
against Parent in accordance with its terms, except as such enforceability may
be limited by bankruptcy and other laws affecting the rights and remedies of
creditors generally and general principles of equity, (d) assuming that the
consents, approvals, authorizations, permits, filings and notifications
referred to in subsection (e) are obtained or made, as applicable, the
execution and delivery of this Agreement by Parent does not, and the
performance of this Agreement by Parent will not, result in any Violation
pursuant to, (A) any provision of the Certificate of Incorporation or By-laws,
each as amended, of Parent, (B) any provisions of any material mortgage,
indenture, lease, contract or other agreement, instrument, permit, concession,
franchise, or license or (C) any judgment, order, decree, statute, law,
ordinance, rule or regulation applicable to Parent or its properties or assets,
except in the case of each of clauses (B) and (C) immediately, above, for
Violations which would not, individually or in the aggregate, have a Material
Adverse Effect on Parent, (e) except as described in Section 3.3 of the
Reorganization Agreement and Section 3(a) of this Agreement, and except as may
be required under the Exchange Act, the execution and delivery of this
Agreement by Parent does not, and the performance of this Agreement by Parent
will not, require any consent, approval, authorization or permit of, or filing
with or notification to, any Governmental Entity or Regulatory Entity and (f)
any Company Shares acquired upon exercise of the Company Option will not be,
and the Company Option is not being, acquired by Parent with a view to the
public distribution thereof and Parent will not sell or otherwise dispose of
such shares in violation of applicable law or this Agreement.
7. Registration Rights.
(a) Following any exercise of the Company Option,
Parent may by written notice (the "Registration Notice") to Company request
Company to register under the Securities Act all or any part of the shares of
Company Common Stock acquired pursuant to this Agreement, including any voting
securities issued by way of dividend, distribution or otherwise in respect
thereof (the "Restricted Shares"), beneficially owned by Parent (the
"Registrable Securities") in order to permit the sale or other distribution of
such Registrable Securities, including pursuant to a firm commitment
underwritten public offering; provided, however, that any such Registration
Notice must relate to a number of shares equal to at least 2% of the
outstanding shares of Company Common Stock and that any rights to require
registration hereunder shall terminate with respect to any Shares that may be
sold in any 90-day period pursuant to Rule 144 under the Securities Act. The
Registration Notice shall include a certificate executed by Parent and its
proposed managing underwriter, which underwriter shall be an investment banking
firm of nationally recognized standing and reasonably acceptable to the Company
(the "Manager"), stating that Manager in good faith believes that, based on the
then prevailing market conditions, it will be able to sell the Registrable
Securities at a per share price equal to at least 90% of the Fair Market Value
of such shares. For purposes of this Section 8, the term "Fair Market Value"
shall mean the per share average of the closing sale prices of Company's Common
Stock on the Nasdaq National Market for the twenty (20) trading days
immediately preceding the date of the Registration Notice.
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(b) Company shall use commercially reasonable
efforts to effect, as promptly as practicable, the registration under the
Securities Act of the unpurchased Registrable Securities; provided, however,
that (i) Parent shall not be entitled to more than two effective registration
statements hereunder and (ii) Company will not be required to file any such
registration statement during any period of time (not to exceed 40 days after
such request in the case of clause (A) below or 90 days in the case of clauses
(B) and (C) below) when (A) Company is in possession of material non-public
information which it reasonably believes would be detrimental to be disclosed
at such time and, based on consultation with counsel to Company, such
information would have to be disclosed if a registration statement were filed
at that time; (B) Company is required under the Securities Act to include
audited financial statements for any period in such registration statement and
such financial statements are not yet available for inclusion in such
registration statement; or (C) Company determines, in its reasonable good
faith, judgment, that such registration would interfere with any financing,
acquisition or other material transaction involving Company or any of its
affiliates. 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, then such registration
shall not be taken into account as an effective registration for purposes of
clause (i) above. Company shall use commercially reasonable efforts to cause
any Registrable Securities registered pursuant to this Section 8 to be
qualified for sale under the securities or Blue Sky laws of such jurisdictions
as Parent may reasonably request and shall continue such registration or
qualification in effect in such jurisdiction; provided, however, that Company
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.
(c) The registration rights set forth in this
Section 8 are subject to the condition that Parent shall provide Company with
such information with respect to Parent's Registrable Securities, the plans for
the distribution thereof, and such other information with respect to Parent as,
in the reasonable judgment of counsel for Company, is necessary to enable
Company to include in such registration statement all material facts required
to be disclosed with respect to a registration thereunder.
(d) If Company securities of the same type as the
Registrable Securities are then authorized for quotation or trading or listing
on the New York Stock Exchange, the Nasdaq National Market, or any other
securities exchange or automated quotations system, Company, upon the request
of Parent, shall promptly file an application, if required, to authorize for
quotation, trading or listing the shares of Registrable Securities on such
exchange or system and will use its reasonable best efforts to obtain approval,
if required, of such quotation, trading or listing as soon as practicable.
(e) A registration effected under this Section 7
shall be effected at Company's expense, except for underwriting discounts and
commissions and fees and expenses of counsel to Parent, and Company shall
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 as such underwriters may
reasonably require. In connection with any such registration, the parties
agree (i) to indemnify each other and the underwriters in the customary manner
and (ii) to enter into an underwriting agreement in form
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and substance customary for transactions of the type contemplated hereby with
the Manager and the other underwriters participating in such offering.
8. Adjustment Upon Changes in Capitalization.
(a) In the event of any change in Company Common
Stock by reason of stock dividends, splits, mergers (other than the Merger),
recapitalizations, combinations, exchange of shares or the like, the type and
number of shares or securities subject to the Company Option, and the Exercise
Price per share, shall be adjusted appropriately, and proper provision shall be
made in the agreements governing such transaction so that Parent shall receive,
upon exercise of the Company Option, the number and class of shares or other
securities or property that Parent would have received in respect of the
Company Common Stock if the Company Option had been exercised immediately prior
to such event or the record date therefor, as applicable.
(b) In the event that Company shall enter in an
agreement: (i) to consolidate with or merge into any person, other than Parent
or any of its Subsidiaries, and shall not be the continuing or surviving
corporation of such consolidation or merger; (ii) to permit any person, other
than Parent or one of its subsidiaries, to merge into Company and Company shall
be the continuing or surviving corporation, but, in connection with such
merger, the then-outstanding shares of Company Common Stock shall be changed
into or exchanged for stock or other securities of Company or any other person
or cash or any other property or the outstanding shares of Company Common Stock
immediately prior to such merger shall after such merger represent less than
50% of the outstanding shares and share equivalents of the merged company; or
(iii) to sell or otherwise transfer all or substantially all of its assets to
any person, other than Parent or any of its Subsidiaries, then, and in each
such case, the agreement governing such transaction shall make proper provision
so that upon the consummation of any such transaction and upon the terms and
conditions set forth herein, Parent shall receive for each Company Share with
respect to which the Company Option has not been exercised an amount of
consideration in the form of and equal to the per share amount of consideration
that would be received by the holder of one share of Company Common Stock less
the Exercise Price (and, in the event of an election or similar arrangement
with respect to the type of consideration to be received by the holders of
Company Common Stock, subject to the foregoing, proper provision shall be made
so that the holder of the Company Option would have the same election or
similar rights as would the holder of the number of shares of Company Common
Stock for which the Company Option is then exercisable).
9. Certain Agreements of Company. Company agrees: (1)
that it will not, by charter amendment or through reorganization,
consolidation, merger, dissolution or sale of assets, or by any other voluntary
act, avoid or seek to avoid the observance or performance of any of the
covenants, stipulations or conditions to be observed or performed hereunder by
Company and (2) promptly to take all action as may from time to time be
required (including (x) complying with all applicable premerger notification,
reporting and waiting period requirements specified in 15 U.S.C. Section 18a
and regulations promulgated thereunder and (y) in the event that, under the
Home Owners' Loan Act, as amended, or any state or other federal banking law,
prior approval of or notice to the OTS or to any state or other federal
regulatory authority is necessary before the Option may be exercised,
cooperating fully with Parent in preparing such applications or notices and
providing such information to the OTS or such state or other federal
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regulatory authority as they may require) in order to permit Parent to exercise
the Option and Company duly and effectively to issue shares of Company Common
Stock pursuant hereto.
10. Restrictive Legends. Each certificate representing
shares of Company Common Stock issued to Parent hereunder shall, to the extent
applicable, 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, AND MAY BE REOFFERED
OR SOLD ONLY IF SO REGISTERED OR IF AN EXEMPTION FROM SUCH REGISTRATION IS
AVAILABLE. SUCH SECURITIES ARE ALSO SUBJECT TO ADDITIONAL RESTRICTIONS ON
TRANSFER AS SET FORTH IN THE STOCK OPTION AGREEMENT, DATED AS OF MAY 31, 1999,
A COPY OF WHICH MAY BE OBTAINED FROM THE ISSUER.
11. Binding Effect; No Assignment. This Agreement shall
be binding upon and inure to the benefit of the parties hereto and their
respective successors and permitted assigns. Neither this Agreement nor the
rights or the obligations of either party hereto are assignable, except by
operation of law, or with the written consent of the other party. Nothing
contained in this Agreement, express or implied, is intended to confer upon any
person other than the parties hereto and their respective permitted assigns any
rights or remedies of any nature whatsoever by reason of this Agreement. Any
Restricted Shares sold by Parent in compliance with the provisions of Section 7
shall, upon consummation of such sale, be free of the restrictions imposed with
respect to such shares by this Agreement, unless and until Parent shall
repurchase or otherwise become the beneficial owner of such shares, and any
transferee of such shares shall not be entitled to the rights of Parent.
Certificates representing shares sold in a registered public offering pursuant
to Section 7 shall not be required to bear the legend set forth in Section 10.
12. 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 should be brought in equity to
enforce the provisions of this Agreement, neither party will allege, and each
party hereby waives the defense, that there is an adequate remedy at law.
13. Entire Agreement. This Agreement and the
Reorganization Agreement (including the Company Disclosure Schedule and the
Parent Disclosure Schedule relating thereto) constitute the entire agreement
among the parties with respect to the subject matter hereof and supersede all
other prior agreements and understandings, both written and oral, among the
parties or any of them with respect to the subject matter hereof.
14. Further Assurance. 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 the transactions contemplated
hereby.
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15. Validity. The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or enforceability of
the other provisions of this Agreement, which shall remain in full force and
effect. In the event any court or other competent authority holds any
provision of this Agreement to be null, void or unenforceable, the parties
hereto shall negotiate in good faith the execution and delivery of an amendment
to this Agreement in order, as nearly as possible, to effectuate, to the extent
permitted by law, the intent of the parties hereto with respect to such
provision. Each party agrees that, should any court or other competent
authority hold any provision of this Agreement or part hereof to be null, void
or unenforceable, or order any party to take any action inconsistent herewith,
or not take any action required herein, the other party shall not be entitled
to specific performance of such provision or part hereof or to any other
remedy, including but not limited to money damages, for breach hereof or of any
other provision of this Agreement or part hereof as the result of such holding
or order.
16. Notices. Any notice or communication required or
permitted hereunder shall be in writing and either delivered personally,
telegraphed or telecopied or sent by certified or registered mail, postage
prepaid, and shall be deemed to be given, dated and received when so delivered
personally, telegraphed or telecopied or, if mailed, five business days after
the date of mailing to the following address or telecopy number, or to such
other address or addresses as such person may subsequently designate by notice
given hereunder.
(a) if to Parent or Merger Sub, to:
E*TRADE Group, Inc.
Four Embarcadero Place
▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, Esq.
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇▇, Phleger & ▇▇▇▇▇▇▇▇ LLP
▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. Mo, Esq.
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
and
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▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP
Spear Street Tower
▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: J. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Esq.
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
(b) if to Company, to:
Telebanc Financial Corporation
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: President
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP
Columbia Square
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇▇▇▇ ▇.▇. ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Esq.
▇▇▇▇▇▇ ▇▇▇▇▇, Esq.
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
17. Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of Delaware applicable
to agreements made and to be performed entirely within such State without
regard to any applicable conflicts of law rules.
18. Descriptive Headings. The descriptive headings
herein are inserted for convenience of reference only and are not intended to
be part of or to affect the meaning or interpretation of this Agreement.
19. Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed to be an original, but all of
which, taken together, shall constitute one and the same instrument.
20. Expenses. Except as otherwise expressly provided
herein or in the Reorganization Agreement, all costs and expenses incurred in
connection with the transactions contemplated by this Agreement shall be paid
by the party incurring such expenses.
21. 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.
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IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective duly authorized officers as of the
date first above written.
E*TRADE Group, Inc.
By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: CHIEF EXECUTIVE OFFICER
Telebanc Financial Corporation
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: President and Chief
Executive Officer
SIGNATURE PAGE TO STOCK OPTION AGREEMENT