- 23 - #0142327
67453-31044
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
(Amendment No. 19)
of S.G.I. Partners, L.P.
SCHEDULE 13D
(Amendment No. 9)
of
S.G.I. Partners, L.P. and
Peter R. Kellogg
SCHEDULE 13D
(Amendment No. 5)
of
Peter R. Kellogg
Under the Securities Exchange Act of 1934
The Sherwood Group, Inc.
(Name of Issuer)
Common Stock, Par Value $.01 per Share
(Title of Class of Securities)
824380109
(CUSIP Number)
S.G.I. Partners, L.P.
120 Broadway
New York, New York 10271
Peter R. Kellogg
120 Broadway
New York, New York 10271
(Name, address and telephone number of person
authorized to receive notices and communications)
December 5, 1997
(Date of event which requires filing of this statement)
Cusip No. 824380109
1. NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
S.G.I. Partners, L.P.
112972100
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) ___
(b) _X_
3. SEC USE ONLY
4. SOURCE AND AMOUNT OF FUNDS
WC
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(D) OR 2(E)
N/A
6. CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
Number of Shares Beneficially Owned by Each Reporting Person
With:
7. SOLE VOTING POWER 4,000,000
8. SHARED VOTING POWER 0
9. SOLE DISPOSITIVE POWER 4,000,000
10.SHARED DISPOSITIVE POWER 0
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
4,000,000
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
31.4%
14. TYPE OF REPORTING PERSON - PN
1. NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Peter R. Kellogg
SS# ###-##-####
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) _X_
(b) ___
3. SEC USE ONLY
4. SOURCE AND AMOUNT OF FUNDS
PF
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(D) OR 2(E)
N/A
6. CITIZENSHIP OR PLACE OF ORGANIZATION - USA
Number of Shares Beneficially Owned by Each Reporting Person
With:
7. SOLE VOTING POWER
1,000,0000
8. SHARED VOTING POWER
21,500
9. SOLE DISPOSITIVE POWER
1,000,000
10.SHARED DISPOSITIVE POWER
21,500
11. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
1,021,500
12. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES
13. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
8.03%
14. TYPE OF REPORTING PERSON - IN
Preliminary Note
This statement constitutes (a) Amendment No. 19 to the
Statement on Schedule 13D originally filed (the "Original
Statement") by S.G.I. Partners, L.P., a Delaware limited
partnership ("SGI"), (b) Amendment No. 9 to Schedule 13D filed by
the group (subject to the following paragraph) comprised of
S.G.I. and Peter R. Kellogg, and (c) Amendment No. 5 to Schedule
13D filed on behalf of Peter R. Kellogg.
The filing of this Combined Statement/Amendment is not and
shall not be deemed to be an admission that S.G.I. or Peter R.
Kellogg, comprise a "group" within the meaning of Section 13(d)
of the Securities Exchange Act of 1934.
This Combined Statement/Amendment is being filed as a result
of the execution of a Stock Purchase Agreement dated December 5,
1997 between The Sherwood Group, Inc. and IAT Reinsurance
Syndicate Ltd. (The "Stock Purchase Agreement") See Item 6.
Item 1. Security and Issuer
This Combined Statement/Amendment relates to the Common
Stock, par value $.01 (the "Common Stock"), of The Sherwood
Group, Inc., a Delaware corporation (the "Issuer"). The address
of the principal executive office of the Issuer is 10 Exchange
Place, Jersey City, New Jersey, 07302.
Item 2. Identity and Background
The persons filing this Combined Statement/Amendment are (a)
S.G.I. and (b) Peter R. Kellogg. This statement contains
information regarding shares of Common Stock owned by I.A.T.
Reinsurance Syndicate Ltd. ("IAT"), a Bermuda corporation of
which Mr. Kellogg is the sole holder of voting stock, and the
Peter R. and Cynthia K. Kellogg Foundation (the "Foundation"), a
charitable entity of which Peter R. Kellogg is a trustee. Mr.
Kellogg has sole dispositive and voting power with respect to the
shares of Common Stock owned personally and by IAT, and has
shared dispositive and voting power with respect to the shares of
Common Stock owned by the Foundation. Although shares of Common
Stock owned by IAT and the Foundation may be deemed to be
beneficially owned by Mr. Kellogg, the filing of this Statement
should not be deemed an admission that Mr. Kellogg beneficially
owns such shares or that the Foundation and IAT, or any other
person or persons refereed to herein constitute a "group" within
the meaning of Section 13(d)(3) of the Securities Exchange Act of
1934 (the "Act"), and the rules and regulations thereunder. (the
"Rules").
S.G.I.'s business address is:
120 Broadway
New York, New York 10271
The Foundation's business address is
c/o Spear, Leeds & Kellogg
120 Broadway
New York, New York 10271
Mr. Kellogg's principal occupation is:
Senior Managing Director
Spear, Leeds & Kellogg
120 Broadway
New York, New York 10271
IAT's address is:
c/o Spear, Leeds & Kellogg
120 Broadway
New York, New York 10271
Item 3. Source and Amount of Funds or Other Consideration
See Item 6.
Item 4. Purpose of Transaction
If the transaction memorialized by the Stock Purchase
Agreement is concluded, the Common Stock will be acquired by IAT
for investment purposes only.
Neither Mr. Kellogg, IAT, or the Foundation, as
stockholders, have plans or proposals which related to or which
would result in any of the actions in clauses (a) through (j) of
Item 4 of Schedule 13D.
Mr. Kellogg, IAT and the Foundation, may determine to
purchase additional shares of Common Stock at any time and from
time to time subject to market and general economic conditions
and any purchase or purchases may be effected directly or through
one or more entities controlled or deemed to be controlled by Mr.
Kellogg. Mr. Kellogg may also sell or otherwise dispose of
shares of Common Stock owned directly or indirectly by him at any
time or from time to time, although he has no present plans or
proposals to do so. Any purchases or sales by Mr. Kellogg may be
in the open market, in a privately negotiated transaction or
otherwise.
Item 5. Interest in Securities of
(a) As of December 12, 1997, S.G.I. beneficially owned
directly an aggregate of 4,000,000 shares of Common Stock,
constituting 31.4% of the 12,724,624 shares outstanding. As of
December 12, 1997, Peter Kellogg beneficially owned directly and
indirectly through IAT and the Foundation an aggregate of
1,021,500 shares of Common Stock, constituting 8.03% of the
Common Stock outstanding. Of those shares, 650,000 were owned by
Mr. Kellogg personally, 350,000 shares were owned by IAT, and
21,500 shares were owned by the Foundation.
(b) S.G.I. has sole dispositive power with respect to the
4,000,000 shares that it owns. Peter R. Kellogg has sole
dispositive power with respect to the 1,000,000 shares of Common
Stock that he and IAT own, and Mr. Kellogg has shared dispositive
and voting power with respect to the shares of Common Stock owned
by the Foundation.
(c) Other than the transaction memorialized by the Stock
Purchase Agreement, there have been no transactions in the Common
Stock of the issuer in the past sixty days.
Item 6. Contract Arrangements, Understandings or Relationships
with respect to securities of the Issuer.
The Sherwood Group, Inc. and IAT have entered into a Stock
Purchase Agreement dated December 5, 1997. Under its terms, and
subject to the satisfaction of conditions precedent including the
expiration of any waiting period under the Hart Scott Rodino
Antitrust Improvement Act of 1976, as amended, IAT shall purchase
1,500,000 shares of the Common Stock of the issuer.
Item 7. Material to be filed as Exhibit.
STOCK PURCHASE AGREEMENT Dated As Of December 5, 1997.
SIGNATURE
After reasonable inquiry and to the best of my knowledge and
belief, I certify that the information set fourth in this
Statement is true, complete and correct.
Dated: December 12, 1997
______________________________
Peter R. Kellogg
120 Broadway
New York, NY 10271
______________________________
Carl H. Hewitt, President
SHD Capital Inc. - General
Partner of S.G.I. Partners, L.P.
STOCK PURCHASE AGREEMENT
Dated as of December 5, 1997
between
THE SHERWOOD GROUP, INC.
and
IAT REINSURANCE SYNDICATE LTD.
12/5/97
STOCK PURCHASE AGREEMENT
This STOCK PURCHASE AGREEMENT dated as of December __, 1997
(the "Agreement") by and between THE SHERWOOD GROUP, INC., a
Delaware corporation, having its principal office at 10 Exchange
Place Centre, Jersey City, New Jersey 07302 ("Seller"), and IAT
REINSURANCE SYNDICATE LTD., a corporation formed under the laws
of the Commonwealth of Bermuda with offices at Cedar House, 41
Cedar Avenue, Hamilton, Bermuda ("Buyer").
RECITALS:
A. Buyer wishes to acquire 1,500,000 shares of the common
stock, par value $.01 per share, of the Seller (the "Shares").
B. Seller desires to issue to Buyer, the Shares, upon the
terms and subject to the conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the premises and the
respective representations, warranties, covenants, agreements and
conditions hereinafter set forth, the parties hereto, intending
to be legally bound, agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1. Definitions. (a) As used in this Agreement,
the terms defined in the Preamble and the Recitals hereto shall
have the respective meanings ascribed thereto, and the following
terms shall have the meanings set forth below (such definitions
to be applicable equally to the singular and plural forms
thereof):
"Change of Control": shall be deemed to have occurred if
the board of directors of Seller approves and Seller executes and
delivers a definitive agreement with a Person (i) to merge into
or, consolidate with, or engage in a similar transaction with
such Person where, as a result of such merger, consolidation, or
similar transaction, the stockholders of Seller will own less
than 50% of the outstanding shares of the survivor after such
merger, consolidation or similar transaction or (ii) to sell all
or substantially all Seller's assets to a Person or (iii) the
stockholders of Seller approve a plan of complete liquidation of
Seller.
"Closing": as defined in Section 7.1.
"Closing Date": as defined in Section 7.1.
"Closing Documents": collectively, this Agreement and all
other documents and instruments to be executed and delivered by
Seller pursuant hereto, including the Registration Rights
Agreement.
"GAAP": generally accepted United States accounting
principles.
"Governmental Authority": any nation or government, any
state or other political subdivision thereof, any regulatory
agency or body and any entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining
to government.
"HSR": Hart Scott Rodino Antitrust Improvement Act of 1976,
as amended, and the rules and regulations issued thereunder.
"Laws": all federal, state, local and foreign laws,
ordinances, orders, rules and regulations (including, without
limitation, those relating to discrimination in employment,
occupational safety and health, trade practices, competition and
pricing, product warranties, zoning, building and sanitation,
toxic and chemical substances, employment, retirement and labor
relations, product advertising and pollution, discharge, disposal
and emission of wastes, materials and gases into the environment.
"Person" means an individual, a partnership, a corporation,
an association, a joint stock company, a trust, a joint venture,
an unincorporated organization, or a governmental entity (or any
department, agency, or political subdivision thereof).
"Registration Rights Agreement" means the Registration
Rights Agreement between Seller and Buyer dated the date of this
Agreement respecting the registration of the Shares under the
Securities Act.
"Securities Act": the Securities Act of 1933, as amended,
and any rules and regulations promulgated thereunder and any
successor federal statute, rules or regulations.
"Securities Exchange Act": Securities Exchange Act of 1934,
as amended, and any rules and regulations promulgated thereunder
and any successor federal statutes, rules or regulations.
"SEC": United States Securities and Exchange Commission.
"Seller Reports": as defined in Section 3.6.
"Subsidiary" means any corporation with respect to which a
specified Person (or a Subsidiary thereof) owns a majority of the
common stock or has the power to vote or direct the voting of
sufficient securities to elect a majority of the directors.
(b) Knowledge. To the extent that any representation,
warranty or other provision in the Agreement is, by its terms,
based upon or limited by the "knowledge" of Seller, that term
signifies that no information has come to the attention of Seller
or any of the president, executive vice president, senior vice
president or vice president of Seller that would give such party
actual knowledge or actual notice that such representation or
warranty or the subject matter of such provision is not true,
accurate or complete.
ARTICLE II
ISSUANCE AND PURCHASE OF SHARES
Section 2.1. Sale and Purchase of Shares. Seller hereby
agrees to issue to Buyer, and Buyer hereby agrees to purchase and
accept from Seller, the Shares upon the terms, conditions,
representations, warranties, covenants and agreements set forth
herein.
Section 2.2. Purchase Price. The purchase price for the
Shares is $19,312,500 (the "Purchase Price") payable to Seller in
immediately available funds by wire transfer on the date this
Agreement is executed by Seller and Buyer. Seller will return
the Purchase Price to Buyer if the Closing does not occur prior
to the termination of this Agreement.
Section 2.3 Use of Proceeds. Pending the Closing, Seller
may utilize the funds representing the Purchase Price for
investment in its subsidiaries.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SELLER
Seller represent and warrant to Buyer as follows:
Section 3.1. Capitalization of Seller. The authorized
capital stock of Seller consists of 51,000,000 shares, 1,000,000
of which are preferred stock, par value $.01 per share, none of
which are outstanding, 50,000,000 shares of common stock, $.01
par value per share, of which 12,724,624 shares are issued and
currently outstanding as of the date hereof and 845,898 of which
are reserved at the date hereof for issuance for options granted
or to be granted under The Sherwood Group, Inc. 1995 Stock Option
Plan, as amended and 1,618,577 of which at the date hereof are
held as treasury stock. All of the Shares when issued and paid
for as provided in this Agreement will be fully paid and
nonassessable.
Section 3.2. Organization; Corporate Name. Seller is a
corporation duly organized, validly existing and in good standing
under the laws of the State of Delaware.
Section 3.3. Authority. No further corporate act or
proceeding on the part of Seller is necessary to authorize this
Agreement or the other Closing Documents or the consummation of
the transactions contemplated hereby and thereby. This Agreement
constitutes and, when executed and delivered, the other Closing
Documents will constitute, valid and binding agreements of Seller
enforceable against Seller in accordance with their respective
terms, except as limited by bankruptcy, insolvency,
reorganization, moratorium or other laws affecting creditors'
rights generally, and by general equitable principles affecting
the availability of equitable relief.
Section 3.4. No Violation. Neither the execution and
delivery of this Agreement or the other Closing Documents, nor
the consummation by Seller of the transactions contemplated
hereby and thereby (i) will violate any statute, law, rule,
regulation, order, writ, injunction or decree of any court or
Governmental Authority applicable to Seller or any Subsidiary,
(ii) will require any authorization, consent, approval, exemption
or other action by, or filing with or notice to, any court or
Governmental Authority or any other Person, other than the
filings with and approvals disclosed in Schedule 3.4, or (iii)
will violate or conflict with, or constitute a default (or an
event which, with notice or lapse of time, or both, would
constitute a default) under, or will result in the termination
of, or accelerate the performance required by, or result in the
creation of any lien, security interest, charge or encumbrance
upon any of the assets material to the business, assets or
financial condition of Seller, under any term or provision of (a)
the Restated Certificate of Incorporation, as amended, or By-laws
of Seller, or (b) any material contract, commitment,
understanding, arrangement, agreement or restriction of any kind
or character to which Seller or any Subsidiary is a party, or by
which Seller or any Subsidiary, or any of their respective assets
or properties may be bound.
Section 3.5. Brokers or Finders. Neither Seller, nor any
person acting on its behalf has employed any broker or finder or
consultant, or has incurred any obligation or liability for any
brokerage fees, commissions, finders' fees or consultants' fees
in connection with the transactions contemplated by this
Agreement, and no Person has or will have any right, interest or
valid claim against or upon Buyer, for any such fee or
commission.
Section 3.6. SEC Reports; Financial Statements. Seller has
filed all reports, registration statements and filings, together
with any amendments required to be made thereto, required to be
filed with the SEC under the Securities Exchange Act since
January 1, 1993, including, but not limited to, Form 10-K, Form
10-Q and proxy statements, and will so file all such reports,
statements and filings required after the date hereof
(collectively, the "Seller Reports"). Included or to be included
in the Seller Reports are the consolidated financial statements
of Seller, which consist of the audited consolidated statement of
condition at May 31, 1997, and the related consolidated statement
of income and retained earnings and changes in financial position
for the fiscal year then ended. Seller financial statements
fairly presented, and the financial statements contained in the
Seller Reports filed after the date hereof will fairly present,
the financial position of Seller and its Subsidiaries (on a
consolidated basis) as at the dates thereof and the results of
operations and changes in financial position for the periods then
ended in conformity with GAAP applied on a consistent basis
(subject to any exceptions as to consistency specified in the
financial statements, and, in the case of the interim financial
statements, to normal recurring year-end adjustments). As of
their respective dates, the Seller Reports referred to herein
complied, or will comply, as the case may be, in all material
respects with all rules and regulations promulgated by the SEC
and did not, or will not, as the case may be, contain any untrue
statement of a material fact or omit to state a material fact
required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which
they were made, not misleading. Since May 31, 1997, neither
Seller nor any of its Subsidiaries has suffered any change in its
condition (financial or otherwise), properties, assets,
liabilities, prospects, business or operations which have been,
in any case or in the aggregate, materially adverse to Seller and
its Subsidiaries taken as a whole.
Section 3.7. Disclosure. No representation or warranty of
Seller contained in this Agreement or fact disclosed in the
Schedules of Seller hereto contains any untrue statement or omits
to state a material fact necessary in order to make the
statements herein or therein, in light of the circumstances under
which they were made, not misleading.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and warrants to Seller as follows:
Section 4.1. Status. Buyer is a corporation, duly
organized, validly existing and in good standing under the laws
of the Commonwealth of Bermuda and is an "accredited investor" as
defined in Rule 501 of Regulation D of the Securities Act.
Section 4.2. Validity. This Agreement and the Registration
Rights Agreement constitute the valid, legal and binding
agreements of Buyer, enforceable against Buyer in accordance with
their respective terms, except as such may be limited by
bankruptcy, insolvency, reorganization, moratorium or other laws
affecting creditors' rights generally, and by general equitable
principles affecting the availability of equitable relief. No
further corporate act or proceeding on the part of Buyer is
necessary to authorize this Agreement and the Registration Rights
Agreement or the consummation of the transaction contemplated
thereunder by Buyer.
Section 4.3. No Violation. Neither the execution and
delivery of this Agreement and the Registration Rights Agreement,
nor the consummation by Buyer of the transactions contemplated
hereby and thereby (i) will violate any statute, law, rule,
regulation, order, writ, injunction or decree of any court or
Governmental Authority applicable to Buyer or any Subsidiary or
Peter R. Kellogg, (ii) will require any authorization, consent,
approval, exemption or other action by, or filing with or notice
to, any court or Governmental Authority or any other Person,
other than the filings with and approvals disclosed in Schedule
4.3, or (iii) will violate or conflict with, or constitute a
default (or an event which, with notice or lapse of time, or
both, would constitute a default) under, or will result in the
termination of, or accelerate the performance required by, or
result in the creation of any lien, security interest, charge or
encumbrance upon any of the assets material to the business,
assets or financial condition of Buyer, under any term or
provision of (a) the basic corporate documents of Buyer, or (b)
any material contract, commitment, understanding, arrangement,
agreement or restriction of any kind or character to which
Seller, or any Subsidiary, or Peter R. Kellogg is a party, or by
which Buyer or any Subsidiary or Peter R. Kellogg, or any of
their respective assets or properties may be bound.
Section 4.4. Governmental Filings. Except as provided in
Schedule 4.3., no notices, reports or other filings are required
to be made by Buyer with, nor are any consents, registrations,
approvals, permits or authorizations required to be obtained by
Buyer from, any Governmental Authorities of the Commonwealth of
Bermuda, the several states of the United States or any foreign
jurisdictions or any other Person in connection with the
execution and delivery of this Agreement by Buyer and the
consummation by Buyer of the transactions contemplated hereby.
Section 4.5. Brokers and Finders. Except as set forth in
Schedule 4.4, neither Buyer nor any person acting on its behalf
has employed any broker, finder or consultant, or incurred any
obligation or liability for any brokerage fees, commissions, or
finders' fees or consultants' fees in connection with the
transactions contemplated by this Agreement, and in any event no
Person has or will have any right, interest or valid claim
against or upon Seller for any such fee or commission.
Section 4.6. Ownership of Shares. Inclusive of 1,021,500
shares of Common Stock of Seller owned by Peter R. Kellogg and
the Shares, Peter R. Kellogg will not be deemed to be
beneficially own more than 2,521,500 shares of Common Stock of
Seller upon consummation of the Closing. All the voting
securities of Buyer are beneficially owned by Peter R. Kellogg.
For purposes of this Agreement, the term beneficially own or
beneficially owned shall have the meaning given such term in Rule
13d-3 of the rules and regulations of the SEC under the
Securities Exchange Act.
Section 4.7. Investment Intent.
(i) Buyer is able to bear the economic risk
of an investment in the Shares,
including the loss of the entire
investment.
(ii) Buyer has prior substantial investment
experience, including investments in non-
registered securities.
(iii) Buyer is fully familiar with the
affairs of Seller.
(iv) Buyer has been afforded the opportunity
to ask questions of, and receive answers
from, directors and executive officers
of Seller concerning Seller, the terms
and conditions of the offering of the
Shares and any additional information
requested by Buyer. Buyer has been
furnished with all information and all
documents which Buyer has requested.
(v) Neither the offer nor the sale of the
Shares is being registered under the
Securities Act or the securities laws of
any state. The Shares are being offered
and sold in reliance on exemptions from
registration under the Securities Act
and the various state securities laws
for transactions not involving any
public offering. Accordingly, none of
the Shares can be sold, pledged,
hypothecated or otherwise transferred
(each individually a "Transfer") by
Buyer unless and until each is
registered under the Securities Act and
the securities laws of each applicable
state or an exemption from registration
pursuant to the Securities Act and such
laws is available to Buyer.
(vi) Seller is relying on exemptions from the
various federal and state securities
laws which depend, in part, upon Buyer's
investment intent and upon the
information Buyer has set forth in this
Agreement. This Agreement is delivered
to Seller by Buyer with the
understanding and intent that Seller
will rely on the representations and
warranties of Buyer contained in this
Agreement and with Buyer's consent to
such reliance.
(vii) The Shares are being purchased by
Buyer for its own account for investment
and not for distribution or resale or
fractionalization thereof or reselling
thereof or any part thereof within the
meaning of the Securities Act other than
in compliance therewith or in accordance
with an exemption therefrom. Buyer will
not Transfer any of the Shares unless
they are registered under the Securities
Act and the securities laws of each
applicable state or unless an exemption
from each such registration is available
for such Transfer, and such Transfer
will not violate the terms of this
Agreement or the Shares. Buyer has
adequate means of providing for its
current needs and possible business
contingencies and has no need for
liquidity of this investment in the
Shares.
(viii) Buyer specifically represents with
respect to the offer and sale of the
Shares to it that it has not received
any advertisement, article, notice or
other communication published in a
newspaper, magazine, or similar media or
broadcast over television or radio, nor
has Buyer attended any seminar or
meeting to which Buyer has been invited
by any general solicitation or general
advertising representing such offer or
sale.
(ix) Buyer understands that the offer and
sale of the Shares has not been
registered under the Securities Act, nor
pursuant to the provisions of the
securities or other laws of any other
applicable jurisdictions, in reliance
upon the exemption for private offerings
contained in Section 4(2) of the
Securities Act and the laws of such
jurisdictions. Buyer is fully aware
that the Shares, sold to Buyer are being
sold in reliance upon such exemptions
based upon Buyer's representations,
warranties and agreements. Buyer is
fully aware of the restrictions on sale,
transferability and assignment of the
Shares, and that Buyer must bear the
economic risk of an investment herein
for an indefinite period of time because
the offer and sale of the Shares has not
been registered under the Securities Act
and, therefore, the Shares cannot be
offered or sold unless the Shares are
subsequently registered under the
Securities Act or an exemption from such
registration is available.
(x) Buyer is making the investment hereunder
for Buyer's own account and not for the
account of others and for investment
purposes only and not with a view to or
for the transfer, assignment, resale or
distribution thereof, in whole or in
part. Buyer has no present plans to
enter into any such contract,
undertaking, agreement or arrangement.
(xi) The representations and warranties in
this Section of this Agreement shall
survive the Closing Date.
(xii) The address set forth in Section
10.7 for Buyer is Buyer's true and
correct residence, and Buyer has no
present intention of becoming a resident
of any other country, state or
jurisdiction prior to its purchase of
the Shares.
(xiii) Buyer acknowledges that Seller and
its officers and agents have made no
representations or warranties, whether
orally or in writing, or express or
implied, as to the financial condition,
assets, operations, business, prospects
or condition of Seller other than as set
forth in this Agreement and the Seller
Reports.
(xiv) Buyer understands the meaning and
legal consequences of the foregoing
representations and warranties, which
are true and correct as of the date
hereof and will be true and correct as
of the date of Buyer's purchase of the
Shares purchased hereby. Each such
representation and warranty shall
survive such purchase.
(xv) Each of the certificates representing
the Shares shall bear substantially the
following legend:
"THE SHARES EVIDENCED BY THIS
CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, AND HAVE BEEN ACQUIRED BY THE
PURCHASER FOR INVESTMENT PURPOSES. SAID
SHARES MAY NOT BE SOLD OR TRANSFERRED
UNLESS (A) THEY HAVE BEEN REGISTERED
UNDER SAID ACT, OR (B) THE TRANSFER
AGENT (OR THE COMPANY IF THEN ACTING AS
ITS TRANSFER AGENT) IS PRESENTED WITH
EITHER A WRITTEN OPINION SATISFACTORY TO
COUNSEL FOR THE COMPANY OR A "NO-ACTION'
OR INTERPRETIVE LETTER FROM THE
SECURITIES AND EXCHANGE COMMISSION TO
THE EFFECT THAT SUCH REGISTRATION IS NOT
REQUIRED UNDER THE CIRCUMSTANCES OF SUCH
SALE OR TRANSFER."
Section 4.8. Disclosure. No representation or warranty of
Buyer contained in this Agreement or fact disclosed in the
Schedules of Buyer hereto contains any untrue statement or omits
to state a material fact necessary in order to make the
statements herein or therein, in light of the circumstances under
which they were made, not misleading.
ARTICLE V
CONDITIONS PRECEDENT TO BUYER'S OBLIGATIONS
The obligations of Buyer hereunder are subject to the
satisfaction or fulfillment, at or prior to the Closing Date, of
each of the following conditions, any or all of which may be
waived in whole or in part by Buyer:
Section 5.1. Representations and Warranties True on the
Closing Date. The representations and warranties of Seller set
forth in Article III of this Agreement, and the statements
contained in the Schedules of Seller hereto or in any other
Closing Document delivered by Seller pursuant to this Agreement,
shall be true and correct in all material respects when made and
as of the Closing Date as though made or given on and as of the
Closing Date, except for any changes contemplated or permitted by
the terms of this Agreement or otherwise consented to in writing
by Buyer.
Section 5.2. Compliance With Agreement. Seller shall have
performed and complied in all material respects with each
obligation and covenant required to be performed or complied with
by Seller at or prior to the Closing Date pursuant to the terms
of this Agreement, including delivery of the Closing Documents
specified in Section 7.2, which shall be in form and substance
satisfactory to Buyer's counsel.
Section 5.3. Absence of Suit. No action, suit or
proceeding before any court or any Governmental Authority shall
have been commenced or threatened, and no investigation by any
Governmental Authority shall have been commenced, against Buyer,
Seller, or any of their respective affiliates, (i) seeking to
restrain, prohibit or enjoin the consummation of the transactions
contemplated hereby or to change any of the terms thereof, (ii)
questioning the validity, legality or enforceability of any such
transactions, or (iii) seeking damages in connection with any
such transactions.
Section 5.4. Consents and Approvals. All filings required
to be made prior to the Closing Date by Seller with, and all
material consents, approvals, waivers and authorizations required
to be obtained prior to the Closing Date by Seller and/or
Seller's Subsidiaries from, Governmental Authorities or other
Persons in connection with the execution and delivery of this
Agreement and the consummation of the transactions contemplated
hereby by Buyer or Seller, including without limitation, the
approval of any regulatory body shall have been made or obtained
(as the case may be).
Section 5.5. Actions Satisfactory. The form and substance
of all actions, proceedings, instruments and documents required
to consummate the transactions contemplated by the Agreement
shall be satisfactory in all reasonable respects to Buyer and its
counsel.
Section 5.6. HSR Act. Any waiting period applicable to the
consummation of the sale of the Shares to Buyer under the HSR Act
shall have expired or been terminated.
Section 5.7. Registration Rights Agreement. Seller shall
have executed and delivered to Buyer the Registration Rights
Agreement.
ARTICLE VI
CONDITIONS PRECEDENT TO SELLER'S OBLIGATIONS
The obligations of Seller hereunder are subject to the
satisfaction or fulfillment, at or prior to the Closing Date, of
the following conditions:
Section 6.1. Representations and Warranties True on the
Closing Date. The representations and warranties of Buyer set
forth in Article IV of this Agreement shall be true and correct
in all material respects when made and as of the Closing Date as
though made or given on and as of the Closing Date.
Section 6.2. Compliance With Agreement. Buyer shall have
performed and complied in all material respects with each
agreement and obligation required to be performed or complied
with by it at or prior to the Closing Date pursuant to the terms
of this Agreement, including the delivery of the Closing
Documents specified in Section 7.3, which shall be in form and
substance satisfactory to Seller's counsel.
Section 6.3. Absence of Suit. No action, suit or
proceeding before any court or any Governmental Authority shall
have been commenced or threatened, and no investigation by any
Governmental Authority shall have been commenced, against Buyer
or Seller or any of their respective affiliates, (i) seeking to
restrain, prohibit or enjoin the consummation of the transactions
contemplated hereby or to change any of the terms thereof, (ii)
questioning the validity, legality or enforceability of any such
transactions, or (iii) seeking damages in connection with any
such transactions.
Section 6.4. Consents and Approvals. All filings required
to be made prior to the Closing Date by Buyer with, and all
material consents, approvals, waivers and authorizations required
to be obtained prior to the Closing Date by Buyer from,
Governmental Authorities or any other Person in connection with
the execution and delivery of this Agreement and the consummation
of the transactions contemplated hereby by Buyer or Seller shall
have been made or obtained (as the case may be).
Section 6.5. Actions Satisfactory. The form and substance
of all actions, proceedings, instruments and documents required
to consummate the transactions contemplated by this Agreement
shall be satisfactory in all reasonable respects to Seller and
his counsel.
Section 6.6. HSR Act. Any waiting period applicable to the
consummation of the sale of the Shares to Buyer under the HSR Act
shall have expired or been terminated.
ARTICLE VII
CLOSING
Section 7.1. Closing Date. The closing of the acquisition
of the Shares and the consummation of the transactions
contemplated by the Agreement (the "Closing") shall take place at
the offices of Crummy, Del Deo, Dolan, Griffinger & Vecchione,
One Riverfront Plaza, Newark, New Jersey, at 10:00 a.m. on
January 31, 1998 or at such other time and place as may be
mutually agreed upon by the parties (the "Closing Date"). All
proceedings to take place on the Closing Date shall be deemed to
take place simultaneously and no delivery shall be deemed to have
been made until all such proceedings have been completed.
Section 7.2. Documents to be Delivered by Seller. At the
Closing, Seller shall deliver to Buyer the following documents:
(a) Stock Certificates. Certificates representing the
Shares registered in the name of Buyer.
(b) Compliance Certificate. A certificate signed by
Seller to the effect that the representations and warranties of
Seller set forth in Article III of this Agreement are true and
correct in all material respects on and as of the Closing Date
with the same effect as though made or given on and as of the
Closing Date (except for changes contemplated or permitted by the
terms of this Agreement or consented to in writing by Buyer), and
that Seller have performed and complied in all material respects
with each obligation and covenant required to be performed or
complied with by Seller on or prior to the Closing Date.
(c) Good Standing Certificates. A good standing
certificate of current date of Seller, from the Secretary of
State of the State of Delaware.
(d) Secretary's Certificates. Certificate, dated the
Closing Date, executed by the Secretary of Seller, which shall
identify by name and title and bear the signature of each officer
thereof authorized to execute any Closing Document to be executed
and delivered on behalf of Seller, pursuant to the terms of this
Agreement and shall have attached to it as exhibits (i) a copy of
the By-laws, as amended, of the Seller, and (ii) a copy of the
Certificate of Incorporation, as amended, of the Seller certified
by the Secretary of State of the state of its formation as of a
recent date.
(e) Opinion of Counsel. The opinion of Crummy, Del
Deo, Dolan, Griffinger & Vecchione, P.C., counsel to Seller,
addressed to Buyer dated the Closing Date, in form reasonably
satisfactory to Buyer and its counsel.
(f) Other Documents. All other documents, instruments
or writings required to be delivered to Buyer at or prior to the
Closing pursuant to the terms of this Agreement, including the
Registration Rights Agreement have been executed and delivered by
Seller.
Section 7.3. Documents to be Delivered by Buyer. At the
Closing, Buyer shall deliver to Seller the following documents:
(a) Compliance Certificate. A certificate signed by
Buyer to the effect that the representations and warranties of
Buyer set forth in Article IV of this Agreement are true and
correct in all material respects on and as of the Closing Date
with the same effect as though made or given on and as of the
Closing Date (except for changes contemplated or permitted by the
terms of this Agreement or consented to in writing by Seller),
and that Buyer has performed and complied in all material
respects with each obligation and covenant required to be
performed or complied with by Buyer on or prior to the Closing
Date.
(b) Good Standing Certificate. A copy of the basic
corporate documents of Buyer certified by the appropriate
governmental authority of the Commonwealth of Bermuda as of a
recent date.
(c) Opinion of Counsel. The opinion of counsel to
Buyer addressed to Seller, dated the Closing Date, in form
reasonably satisfactory to Seller and its counsel.
(d) Other Documents. All other documents, instruments
or writings required to be delivered to Seller at or prior to the
Closing Date pursuant to this Agreement.
ARTICLE VIII
TERMINATION AND ABANDONMENT
Section 8.1. Termination by Mutual Consent. This Agreement
may be terminated at any time prior to the Closing Date by the
mutual written consent of Buyer and Seller.
Section 8.2. Termination by Buyer or Seller. This
Agreement may be terminated at any time prior to the Closing Date
by Buyer or Seller (i) if the Closing has not occurred on or
before January 31, 1998, unless the party seeking to invoke this
subclause (i) is then in material breach of any of its
obligations hereunder; (ii) if a court of competent jurisdiction
or any Governmental Authority shall have issued an order, decree
or ruling or taken any other action, in each case permanently
restraining, enjoining or otherwise prohibiting the transactions
contemplated by this Agreement, and such order, decree, ruling or
other action shall have become final and nonappealable, or (iii)
if the other party shall have breached or failed to comply in all
material respects with its representations, warranties, covenants
and agreements contained in this Agreement; provided, however,
that if such breach or failure is reasonably capable of being
cured on or before January 31, 1998 and such party commences such
cure as soon as practicable and diligently prosecutes (subject to
any other limitations of this Agreement) such cure, such party
shall be entitled to postpone the Closing Date for a period
reasonably sufficient to effect such cure to the reasonable
satisfaction of the party asserting such breach or failure, but
in no event beyond January 31, 1998.
Section 8.3. Effect of Termination. In the event of
termination of this Agreement pursuant to this Article VIII, no
party hereto (or, in the case of Seller, any of its directors or
officers) shall have any liability or further obligation to any
other party to this Agreement, provided that, if this Agreement
is so terminated by a party because one or more of the conditions
to such party's obligations hereunder is not satisfied as a
result of the other party's willful failure to comply with its
obligations under this Agreement, the terminating party's right
to pursue all legal remedies for breach of contract or otherwise,
including, without limitation, damages relating thereto, shall
also survive such termination unimpaired. If this Agreement is
terminated without a Closing, Seller will return the Purchase
Price received by Seller to Buyer upon the date of such
termination.
ARTICLE IX
REPURCHASE RIGHT
In the event a Change of Control occurs within sixty (60)
days after a Closing, Seller shall have the right upon ten (10)
days notice to Buyer after a Change of Control to repurchase the
Shares for the Purchase Price plus interest at the rate of twelve
per cent (12%) per annum on the Purchase Price from the date of
payment by Buyer to Seller to the date the Purchase Price is
returned to Buyer plus the out-of-pocket expenses of Buyer
incurred in connection with this Agreement. Buyer shall tender
certificates representing the Shares duly endorsed for transfer
to Seller or its designee upon payment of the above amount to
Buyer.
ARTICLE X
MISCELLANEOUS AND GENERAL
Section 10.1. Schedules. The Schedules referenced in this
Agreement constitute an integral part hereof. Information set
forth in the Schedules specifically references the article or
section of this Agreement to which such information relates and
shall not be deemed to have been disclosed with respect to any
other article or section of this Agreement or for any other
purpose.
Section 10.2. Further Assurances. Seller and Buyer hereby
agree to execute and deliver such other documents and
instruments, and take such other actions, as may be necessary or
desirable in order to consummate and implement the transactions
contemplated by this Agreement.
Section 10.3. Parties-in-Interest; Assignment. This
Agreement shall be binding upon, inure to the benefit of, and be
enforceable by the parties hereto and their respective successors
and assigns. Buyer may not assign its rights and obligations
under this Agreement to any third party without the consent of
Seller.
Section 10.4. Governing Law. The validity, interpretation,
enforceability and performance of this Agreement shall be
governed by and construed in accordance with the laws of the
State of New Jersey.
Section 10.5. Amendment and Modification. The parties may
amend, modify and supplement this Agreement only by a writing
signed by all parties.
Section 10.6. Waiver of Conditions. The conditions to the
respective obligations of Buyer and Seller to consummate the
transactions contemplated hereby are for the sole benefit of such
party and may be waived by such party in whole or in part.
Section 10.7. Notices. All notices, requests, demands and
other communications hereunder shall be in writing and delivered
personally or sent by express overnight or certified mail,
postage prepaid, or by facsimile transaction:
if to Buyer: IAT Reinsurance Syndicate Ltd.
41 Cedar Avenue
Cedar House,
Hamilton, Bermuda
Facsimile: 441-292-8666
If to Buyer at PO Box:
IAT Reinsurance Syndicate Ltd.
PO Box 1179
Hamilton HMEX, Bermuda
with a copy to:
Peter R. Kellogg
120 Broadway
New York, New York 10271
Facsimile: (212) 433-7294
if to Seller: The Sherwood Group, Inc.
10 Exchange Place Centre
15th Floor
Jersey City, NJ 07302-3913
Facsimile: (973) 946-4510
with a copy to:
Crummy, Del Deo, Dolan, Griffinger & Vecchione
A Professional Corporation
One Riverfront Plaza
Newark, New Jersey 07102-5497
Attention: Frank E. Lawatsch, Jr. Esq.
Facsimile: (973) 639-6249
or to such other persons or addresses as may be designated in
writing by the party to receive such notice.
Section 10.8. Publicity. Prior to the Closing Date,
neither Buyer nor Seller shall issue or make, or cause to be
issued or made, any announcement or written statement for
dissemination to the public concerning this Agreement or the
transactions contemplated hereby without the prior written
consent of the other, except such as may be required to be made
by law or by regulation of any Governmental Authority, and then
only, to the extent practicable, after prior consultation by the
party required to make such announcement or statement with the
other parties hereto concerning the timing and content of such
announcement or other statement. Both parties hereto acknowledge
that Seller will issue a press release and, if it so determines,
make a filing with the SEC respecting this Agreement and the
Registration Rights Agreement.
Section 10.9. Transfer Taxes. Any excise, transfer or
other similar tax imposed with respect to the transactions
provided for in this Agreement, and any interest or penalties-
related thereto, shall be paid by Buyer; and Buyer shall
indemnify and hold Seller harmless from and against any such tax,
interest or penalty that may be assessed against Seller.
Section 10.10. Expenses. Whether or not the transactions
contemplated hereby are consummated, each of the parties shall
bear its own expenses (including, without limitation, the
expenses of its brokers, accountants, counsel and other agents)
in connection with the transactions contemplated hereby, except
as is otherwise provided for in this Agreement or as may
otherwise be agreed to in writing by the parties.
Section 10.11. Entire Agreement. This Agreement (including
the Schedules thereto), constitutes the entire agreement between
the parties hereto with respect to the transactions contemplated
hereby, and there have been and are no agreements,
representations or warranties between the parties other than
those set forth or provided for herein or therein.
Section 10.12. Counterparts. This Agreement may be
executed in one or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute
one and the same instrument.
Section 10.13. Captions. The article, section and
paragraph captions herein are for convenience of reference only,
do not constitute a part of this Agreement, and shall not be
deemed to limit or otherwise affect any of the provisions hereof.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date and year first above written.
THE SHERWOOD GROUP, INC.
By:
Name: Arthur Kontos
Title: President and Chief
Executive Officer
IAT REINSURANCE SYNDICATE LTD.
Name: Peter R. Kellogg
Title: President
