SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
________________
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
________________
August 16, 1996
Date of Report (Date of Earliest Event Reported)
FINANCIAL SERVICES ACQUISITION CORPORATION
___________________________________________________________________________
(Exact Name of Registrant as Specified in Charter)
Delaware 0-25056 59-3262958
(State or Other Jurisdiction (Commission File Number) (I.R.S. Employer
of Incorporation) Identification No.)
667 Madison Avenue
New York, New York
(Address of Principal Executive Offices)
10021
(Zip Code)
212) 317-1000
(Registrant's Telephone Number, Including Area Code)
Not Applicable
(Former Name or Former Address, if Changed
Since Last Report)
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
On August 16, 1996, EBIC Acquisition Corp. ("Merger
Sub"), a wholly owned subsidiary of Financial Services
Acquisition Corporation (the "Registrant"), merged (the "Merger")
with and into Euro Brokers Investment Corporation ("Euro
Brokers"). The Merger was approved by the stockholders of Euro
Brokers at a special meeting of Euro Brokers stockholders held on
July 15, 1996 and by the stockholders of the Registrant at a
special meeting of the Registrant's stockholders held on August
15, 1996 (the "Special Meeting"). The Merger occurred pursuant
to an Agreement and Plan of Merger, dated as of March 8, 1996, as
amended (the "Merger Agreement"), by and among the Registrant,
Merger Sub and Euro Brokers. As a result of the Merger, Euro
Brokers became a wholly owned subsidiary of the Registrant and
each outstanding share of Euro Brokers common stock ("Euro
Brokers Common Stock") was converted into the right to receive
(i) 2.4263288 newly-issued shares of the Registrant's common
stock, par value $.001 per share ("Common Stock"), (ii) 4.5274405
newly-issued series B redeemable common stock purchase warrants
of the Registrant (the "Warrants"), (iii) $11.9398860 in cash,
without interest and (iv) if any fractional interest in a share
of Common Stock or a Warrant would be issuable pursuant to
clauses (i) or (ii) above, the cash value of such fractional
interest in lieu thereof (the consideration described in clauses
(i) through (iv) above, together with any Escrow Amounts (as
defined below) that ultimately become payable, collectively the
"Merger Consideration").
In addition, with respect to each share of Euro Brokers
Common Stock, .2695924 shares of Common Stock and $1.1966804 in
cash have been deposited in escrow (collectively, the "Escrow
Amounts") pending the making of certain post-Merger adjustments.
Whether all, some or none of the Escrow Amounts are eventually
released to holders of Euro Brokers Common Stock who have
surrendered such shares in the Merger (or, alternatively,
returned to the Registrant) will depend on the outcome of certain
events (for example, the accuracy of certain representations and
warranties made by Euro Brokers in the Merger Agreement) that
cannot currently be predicted, although it is expected that final
resolution with respect to the escrowed cash will occur by the
end of 1996 and final resolution with respect to the escrowed
shares will occur by September 1997.
Accordingly, the aggregate Merger Consideration
(including the Escrow Amounts) consists of (i) 4,505,666 shares
of Common Stock (ii) 7,566,666 Warrants and (iii) approximately
$22 million in cash.
The foregoing description of the Merger and the Merger
Agreement is qualified in its entirety by reference to the full
text of the Merger Agreement, a copy of which was filed as
Exhibit 2.1 to the Quarterly Report on Form 10-Q of the
Registrant, dated May 15, 1996. The Merger Agreement is
incorporated herein by reference in its entirety and filed as an
exhibit to this Report. The press releases issued by the
Registrant on August 15, 1996 and August 16, 1996 with respect to
the approval of the Merger Agreement at the Special Meeting and
the consummation of the Merger, respectively, are each
incorporated herein by reference in its entirety and filed as an
exhibit to this Report.
Euro Brokers, through its subsidiaries and affiliates,
is a wholesale broker of money market instruments, derivatives
and selected fixed income securities. It conducts its business
through offices in major financial centers, including New York,
London, Toronto, Tokyo and Hong Kong, and by means of
correspondent relationships with other brokers throughout the
world. Euro Brokers functions primarily as an intermediary,
matching the needs of its customers, who are primarily
multinational banks, securities dealers and other financial
institutions. Euro Brokers had net income of approximately $3.5
million on revenues of approximately $174 million for the year
ended 1995 and net income of approximately $3.5 million on
revenues of approximately $49 million for the three months ended
March 31, 1996 (unaudited). A further description of the
business of Euro Brokers is incorporated by reference from the
section captioned "Business of EBIC" in the Definitive Proxy
Statement on Schedule 14A of the Registrant (the "Proxy
Statement"), filed with the Securities and Exchange Commission
(the "Commission") on July 18, 1996 (File No. 000-25056), which
section is filed as an exhibit to this Report. FSAC currently
intends to maintain Euro Brokers as a wholly owned subsidiary
and, subject to any changes resulting from changing business
conditions or revised strategic plans, to operate Euro Brokers in
substantially the same manner as it operated prior to the Merger,
while also seeking strategic opportunities to expand the
business.
The Merger Consideration was determined by negotiations
between the Registrant and Euro Brokers, and was intended,
subject to the above-described escrow arrangements, to provide
Euro Brokers stockholders (i) with a post-Merger pro forma 50%
ownership interest in the Registrant and (ii) with cash
consideration in an amount that would generally equalize (subject
to certain adjustments) the pre-Merger respective contributions
of the Registrant's stockholders and Euro Brokers' stockholders
to the post-Merger consolidated net worth of the Registrant.
The cash portion of the Merger Consideration was funded primarily
from the proceeds of the Registrant's initial public offering in
December 1994 (the "IPO") and, to a lesser extent, from a post-
Merger cash payment by Euro Brokers.
In addition to approving the Merger at the Special
Meeting, stockholders of the Registrant (i) approved certain
amendments to the Registrant's Certificate of Incorporation (the
"Charter Amendments"), (ii) elected eight persons to the
Registrant's Board of Directors (effective upon consummation of
the Merger) and (iii) adopted the Registrant's 1996 Stock Option
Plan (the "Stock Option Plan"). The background of the Special
Meeting, and of the Merger and the related transactions
contemplated by the Merger Agreement, is more fully described in
the Proxy Statement.
The Charter Amendments provide for (x) immediately
prior to the effectiveness of the Merger, an increase in the
authorized shares of Common Stock from 14,000,00 to 30,000,000,
and (y) immediately after the effectiveness of the Merger, (1)
the classification of the Board of Directors into three classes
serving staggered terms, with the initial number of directors to
be eight, (2) the elimination of the ability of stockholders to
act by written consent, (3) the restriction of the ability to
call special meetings of stockholders to the Chairman and the
President of the Registrant or to an affirmative vote of a
majority of the Board of Directors and (4) a requirement of an
80% supermajority vote to amend any of the provisions described
in this clause (y). A further description of the Charter
Amendments is incorporated by reference from the sections
captioned "Proposal 3: Amendment to Article Sixth" and "Proposal
4: Additional Common Stock Amendment" in the Proxy Statement,
which sections are filed as exhibits to this Report.
The eight directors elected to the Board of Directors
of the Registrant, and the classes to which they were elected,
were:
Director Class
Gilbert D. Scharf Class III
Michael J. Scharf Class III
Larry S. Kopp Class III
Donald R.A. Marshall Class II
Denis Martin Class II
William B. Wigton Class II
James W. Stevens Class I
Frederick B. Whittemore Class I
Class I directors will serve an initial one-year term expiring at
the Registrant's 1997 annual meeting, Class II directors will
serve an initial two-year term expiring at the Registrant's 1998
annual meeting and Class III directors will serve an initial
three-year term expiring at the Registrant's 1999 annual meeting.
Starting with the 1997 annual meeting and continuing for each
succeeding annual meeting, successors to the class of directors
whose term expires at that annual meeting will be elected for a
three-year term. All of the directors, other than Messrs.
Marshall, Wigton and Stevens, were members of the Registrant's
Board of Directors prior to the Merger. Messrs. Marshall and
Stevens were designees of Euro Brokers pursuant to the Merger
Agreement, and Mr. Wigton replaced Mr. William D. Birch, who
resigned effective upon consummation of the Merger. Mr. Marshall
is and remains the President and Chief Executive Officer of Euro
Brokers and, pursuant to the Merger Agreement, is to be appointed
Vice Chairman of the Registrant. Mr. Gilbert Scharf is and
remains Chairman, President and Chief Executive Officer of the
Registrant and has been appointed Vice Chairman of Euro Brokers.
The Stock Option Plan reserves 1,800,000 shares of
Common Stock for issuance. Pursuant to the Stock Option Plan,
no individual may be granted an option or options for more than
500,000 shares of Common Stock in any calendar year. No options
may be granted under the Stock Option Plan after the tenth
anniversary of its adoption. The foregoing summary of the Stock
Option Plan is not complete and is qualified in its entirety by
reference to the full text of the plan, which was filed as
Exhibit 10.11 to the Registration Statement on Form S-4 of the
Registrant (Reg. No. 333-06753), filed with the Commission on
June 25, 1996, and is incorporated herein by reference in its
entirety and filed as an exhibit to this Report.
In connection with and as a condition to consummation
of the Merger, the Registrant also entered into a Registration
Rights Agreement, dated as of August 16, 1996 (the "Registration
Rights Agreement"), providing certain demand and ancillary
registration rights, in each case only effective for periods
after November 30, 1996, with respect to all shares of Common
Stock (including shares received upon exchange or exercise of the
Warrants) then held by Welsh, Carson, Anderson & Stowe VI, L.P.
(Euro Brokers' majority stockholder immediately prior to the
Merger) and certain related investors, certain current members of
Euro Brokers' management and the initial stockholders of the
Registrant (prior to the IPO). The foregoing description of the
Registration Rights Agreement is qualified in its entirety by the
full text of the Registration Rights Agreement, which is
incorporated herein by reference in its entirety and filed as an
exhibit to this Report.
In connection with the Merger, the Registrant also (i)
consummated a previously-announced agreement providing for the
exchange of an aggregate of 225,000 newly-issued shares of Common
Stock for all 333,333 of the Registrant's outstanding unit
purchase options granted to its IPO underwriters and their
designees and (ii) redeemed, at a price of approximately $5.30
per share, 136,000 shares of Common Stock validly tendered for
redemption pursuant to the initial business combination
redemption rights granted under the Registrant's Certificate of
Incorporation to holders of Common Stock issued in the IPO.
Giving effect to these transactions and assuming the issuance of
the entirety of the Merger Consideration, the Registrant will
have outstanding 9,011,332 shares of Common Stock and 15,133,332
Warrants.
ITEM 7. FINANCIAL STATEMENTS
(A) FINANCIAL STATEMENTS OF THE BUSINESS ACQUIRED.
The financial statements required pursuant to Item 7(a)
have not been included in this filing because it was
impracticable at the time hereof. The registrant will
file such financial statements as soon as practicable,
but not later than October 30, 1996.
(B) PRO FORMA FINANCIAL INFORMATION.
The pro forma financial information required pursuant
to Item 7(b) have not been included in this filing
because it was impracticable at the time hereof. The
registrant will file such pro forma financial
information as soon as practicable, but not later than
October 30, 1996.
(C) EXHIBITS.
2.1 Agreement and Plan of Merger, dated as of March 8,
1996, as amended, by and among the Registrant, EBIC
Acquisition Corp. and Euro Brokers Investment
Corporation (incorporated herein by reference to
Exhibit 2.1 of the Quarterly Report on Form 10-Q of the
Registrant (File No. 0-25056), dated May 15, 1996).
2.5 Registration Rights Agreement, dated as of August 16,
1996, by and among the Registrant and the persons
listed in Annexes I, II and III thereto.
10.11 Financial Services Acquisition Corporation 1996
Stock Option Plan (incorporated herein by
reference to Exhibit 10.11 of the Registration
Statement on Form S-4 of the Registrant (Reg. No.
333-06753), filed June 25, 1996).
20.1 Press Release, dated August 15, 1996.
20.2 Press Release, dated August 16, 1996
99.1 Sections captioned "Business of EBIC," "Proposal 3:
Amendment to Article Sixth" and "Proposal 4:
Additional Common Stock Amendment," at pages 86-90, 98-
101 and 101-102, respectively, of the Definitive Proxy
Statement on Schedule 14A of the Registrant (File No.
0-25056), filed July 18, 1996 (incorporated herein by
reference therefrom).
SIGNATURE
Pursuant to the requirements of the Securities Exchange
Act of 1934, the Registrant has duly caused this Report to be
signed on its behalf by the undersigned hereunto duly authorized.
FINANCIAL SERVICES
ACQUISITION CORPORATION
By: /s/ Gilbert Scharf
_______________________________
Name: Gilbert Scharf
Title: Chairman of the Board,
President and Chief
Executive Officer
Date: August 26, 1996
EXHIBIT INDEX
Exhibit No. Description Page No.
2.1 Agreement and Plan of Merger,
dated as of March 8, 1996, as
amended, by and among the
Registrant, EBIC Acquisition
Corp. and Euro Brokers
Investment Corporation
(incorporated herein by
reference to Exhibit 2.1 of the
Quarterly Report on Form 10-Q of
the Registrant (File No. 0-
25056), dated May 15, 1996).
2.5 Registration Rights Agreement,
dated as of August 15, 1996, by
and among the Registrant and the
persons listed on Annexes I, II
and III thereto.
10.11 Financial Services Acquisition
Corporation 1996 Stock Option
Plan (incorporated herein by
reference to Exhibit 10.11 of
the Registration Statement on
Form S-4 of the Registrant (Reg.
No. 333-06753), filed June 25,
1996).
20.1 Press Release, dated August 15,
1996
20.2
Press Release, dated August 16,
1996
99.1 Sections captioned "Business of
EBIC," "Proposal 3: Amendment
to Article Sixth" and "Proposal
4: Additional Common Stock
Amendment," at pages 86-90, 98-
101 and 101-102, respectively,
of the Definitive Proxy
Statement on Schedule 14A of the
Registrant (File No. 0-25056),
filed July 18, 1996
(incorporated herein by
reference therefrom).
CONFORMED COPY
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT (this "Agreement"), dated
as of August 16, 1996, by and among Financial Services
Acquisition Corporation, a Delaware corporation (the "Company"),
and the stockholders listed on Annexes I, II and III hereto and
signatory hereto (the "Stockholders").
WHEREAS, the Company has entered into an Agreement and
Plan of Merger, dated as of March 8, 1996 (the "Merger
Agreement"), with EBIC Acquisition Corp., a Delaware corporation
and a wholly owned subsidiary of the Company ("Sub"), and Euro
Brokers Investment Corporation, a Delaware corporation ("Euro
Brokers"), providing for, among other things, the merger (the
"Merger") of Sub with and into Euro Brokers; and
WHEREAS, this Agreement is being entered into in
connection with and as a condition to the parties thereto closing
the Merger and the other transactions contemplated under the
Merger Agreement;
NOW THEREFORE, for good and valuable consideration, the
receipt of which is hereby acknowledged, the parties signatory
hereto agree as follows:
1. Certain Definitions. As used herein, the
following terms shall have the following respective meanings:
"Commission" shall mean the Securities and Exchange
Commission, or any other federal agency at the time
administering the Securities Act.
"Common Stock" shall mean the Common Stock, $.001 par
value, of the Company as constituted as of the date of this
Agreement, subject to adjustment pursuant to the provisions
of Section 7 hereof.
"EBIC Management Shares" shall mean (i) all shares of
Common Stock (including without limitation the Merger Escrow
Shares and any shares of Common Stock issued in respect of
New Options (as defined in the Merger Agreement)) issued to
the EBIC Management Stockholders in connection with the
Merger and (ii) any additional shares of Common Stock issued
in respect of the Merger Warrants held by the EBIC
Management Stockholders (including any Warrants issued as
part of the New Options), whether upon exercise thereof
pursuant to their terms, upon the exchange thereof pursuant
to the Exchange Offer (as defined in the Merger Agreement)
or otherwise.
"EBIC Management Stockholders" shall mean those persons
listed on Annex II hereto.
"Exchange Act" shall mean the Securities Exchange Act
of 1934 or any similar federal statute, and the rules and
regulations of the Commission thereunder, all as the same
shall be in effect at the time.
"Existing Registration Obligations" shall mean (i) the
registration obligations of the Company under that certain
Warrant Agreement, dated November 30, 1994, between the
Company and Continental Stock Transfer Trust Company, and
(ii) the registration obligations of the Company under that
certain Unit Purchase Option, dated November 30, 1994 and
granted by the Company to certain persons and entities.
"FSAC Management Escrow Shares" shall mean all 833,333
FSAC Management Shares that have been deposited in escrow
pursuant to the terms of that certain Stock Escrow
Agreement, dated November 30, 1994, between the Company,
Continental Stock Transfer & Trust Company and the FSAC
Management Stockholders.
"FSAC Management Shares" shall mean (i) the aggregate
1,430,333 shares of Common Stock currently held by the
Management Stockholders (including the FSAC Management
Escrow Shares) and (ii) any additional shares of Common
Stock issued in respect of the conversion, pursuant to their
terms, or the exchange, pursuant to the Exchange Offer (as
defined in the Merger Agreement) or otherwise, of the FSAC
Management Warrants.
"FSAC Management Stockholders" shall mean those persons
listed on Annex III hereto.
"FSAC Management Warrants" shall mean (i) the aggregate
1,399,000 Warrants currently held by the FSAC Management
Stockholders and (ii) any securities (other than Common
Stock) issued upon exchange, adjustment or transfer of any
such Warrants.
"Investor Shares" shall mean (i) all shares of Common
Stock (including without limitation the Merger Escrow Shares
and any shares of Common Stock issued in respect of New
Options) issued to the Investor Stockholders in connection
with the Merger and (ii) any additional shares of Common
Stock issued in respect of the Merger Warrants held by the
Investor Stockholders (including any Warrants issued as part
of the New Options), whether upon the exercise thereof
pursuant to their terms, upon the exchange thereof pursuant
to the Exchange Offer (as defined in the Merger Agreement)
or otherwise.
"Investor Stockholders" shall mean those persons listed
on Annex I hereto.
"Management Shares" shall mean, collectively, the EBIC
Management Shares and the FSAC Management Shares.
"Management Stockholders" shall mean, collectively, the
EBIC Management Stockholders and the FSAC Management
Stockholders.
"Merger Escrow Shares" shall mean all Investor Shares
and EBIC Management Shares that, pursuant to the terms of
the Merger Agreement and that certain Escrow Agreement,
dated as of March 8, 1996, among the Company, Sub, Euro
Brokers, United States Trust Company of New York, as escrow
agent, and certain others, have been deposited into escrow
to pay, if applicable, certain indemnification and other
obligations arising under the Merger Agreement.
"Merger Warrants" shall mean (i) all Warrants issued to
the Investor Stockholders and the EBIC Management
Stockholders in connection with the Merger and (ii) any
securities (other than Common Stock) issued upon exchange,
adjustment or transfer of any such Warrants.
"Public Sale" shall mean any sale or other disposition
of Common Stock to the public pursuant to an offering
registered under the Securities Act or pursuant to the
provisions of Rule 144 (or any successor or similar rule)
adopted under the Securities Act.
"Registrable Stock" shall mean the Investor Shares, the
Management Shares and any securities issued upon exchange,
adjustment or transfer of any of such shares, subject to
adjustment pursuant to the provisions of Section 7 hereof,
provided, however, that neither the Merger Escrow Shares nor
the FSAC Management Escrow Shares shall be deemed to
constitute shares of Registrable Stock for purposes of the
registration rights granted pursuant to Sections 2 or 3
below until such time as such shares shall have been
released from escrow. As to any particular Registrable
Stock, such securities shall cease to be Registrable Stock
when they have been sold or otherwise disposed of pursuant
to a Public Sale.
"Registration Expenses" shall mean the expenses so
described in Section 5 hereof.
"Securities Act" shall mean the Securities Act of 1933
or any similar federal statute, and the rules and
regulations of the Commission thereunder, all as the same
shall be in effect at the time.
"Selling Expenses" shall mean the expenses so described
in Section 5 hereof.
"Warrants" shall mean the Redeemable Common Stock
Purchase Warrants of the Company.
2. Required Registration.
(a) At any time after October 1, 1996, (i) in the case of
the first such request, the holders of Investor Shares
representing at least a majority of the total outstanding
Investor Shares constituting Registrable Stock at such time, and
(ii) in the case of the second such request, the holders of at
least a majority of the total outstanding Registrable Stock at
such time, may request the Company to register under the
Securities Act all or any portion of the Registrable Stock held
by such requesting holder or holders for sale in the manner
specified in such notice, provided, however, that (x) the only
securities which the Company shall be required to register
pursuant hereto shall be shares of Common Stock and (y) the
Company shall take all necessary steps to ensure that the first
registration of Registrable Stock pursuant to a request made
under this Section 2 is not declared or deemed effective by the
Commission prior to November 30, 1996.
(b) Promptly following receipt of any notice under
paragraph (a) above, the Company shall notify each holder of
Management Shares and any other holders of Registrable Stock of
whom the Company is aware from whom notice has not been received
and shall, subject to the proviso to said paragraph (a), use its
best efforts to register under the Securities Act, for Public
Sale in accordance with the method of disposition specified in
such notice from requesting holders, the number of shares of
Registrable Stock specified in such notice (and in any notices
received from other holders pursuant to this paragraph (b) within
20 days after their receipt of such notice from the Company). If
the holders of a majority of the Registrable Stock requesting
registration specify an underwritten public offering, the Company
shall designate the managing underwriter of such offering,
subject to the approval of the holders of a majority of the
Registrable Stock covered by the offering, which approval shall
not be unreasonably withheld. The Company shall be obligated to
register Registrable Stock pursuant to this Section 2 on two
occasions only. Notwithstanding anything to the contrary
contained herein, the obligation of the Company under this
Section 2 shall be deemed satisfied only when a registration
statement covering all shares of Registrable Stock specified in
notices received as aforesaid, for sale in accordance with the
method of disposition (subject to clauses (i) and (ii) of
paragraph (d) below) specified by the requesting holders, shall
have become effective and, if such method of disposition is a
firm commitment underwritten public offering, all such shares
shall have been sold pursuant thereto.
(c) The Company shall be entitled to include in any
registration statement referred to in this Section 2, for sale in
accordance with the method of disposition specified by the
requesting holders, shares of Common Stock to be sold by the
Company for its own account, except as and to the extent that, in
the opinion of the managing underwriter (if such method of
disposition shall be an underwritten public offering), such
inclusion would adversely affect the marketing of the Registrable
Stock to be sold. Except as provided in this paragraph (c), the
Company will not effect any registration of its Common Stock to
be sold for cash for its own account from the date of receipt of
a notice from requesting holders pursuant to this Section 2 until
the completion of the period of distribution of the registration
contemplated thereby or withdrawal of the registration.
(d) Notwithstanding anything to the contrary contained in
this Section 2:
(i) The number of Management Shares included in the
Registrable Stock to be included in any registration
statement referred to in this Section 2 for which the
requested method of disposition is an underwritten public
offering may be reduced (pro rata among the requesting
holders of Management Shares based upon the number of
Management Shares so requested to be registered) if and to
the extent that in the opinion of the managing underwriter,
such inclusion would adversely affect the marketing of the
Registrable Stock to be sold, provided, however, that if the
Company has determined to include in such registration
statement shares of Common Stock to be sold for its own
account, as contemplated by Section 2(c) above, any
reduction shall first be made, if and to the extent
necessary, from such shares (including a reduction to zero)
before any reduction is made from the shares requested to be
registered by the requesting holders of Management Shares.
(ii) The number of shares of Registrable Stock to be
included in any registration statement referred to in this
Section 2 for which the method of disposition is other than
an underwritten public offering shall not, prior to June 30,
1997, exceed a number equal to 50% of the number of shares
of Registrable Stock then outstanding, provided, however,
that such limitation shall not apply if, at any time prior
to the request for such registration, the product obtained
by multiplying (x) the number of outstanding shares of
Common Stock by (y) the closing price of a share of Common
Stock in the principal securities market in which the Common
Stock shall be traded shall have exceeded $100 million for
20 consecutive trading days.
(iii) The Company shall not be required to file a
registration statement pursuant to this Section 2, (x)
during any period of time when (A) the Company is
contemplating an underwritten public offering of its equity
securities and, in the judgment of the managing underwriter
thereof, such filing would adversely affect the contemplated
offering, (B) the Company is in possession of material
nonpublic information the disclosure of which in such
registration statement it reasonably believes would be
detrimental to the Company at such time or (C) the 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 therein or (y) during the pendency
of the Exchange Offer or within 60 days after the
consummation or termination thereof. The aggregate delays
or postponements by the Company of the filing of a
registration statement pursuant to clause (x) of this
Section 2(d)(iii) shall not exceed 60 days.
3. Incidental Registration. If the Company at any
time after November 30, 1996 (other than pursuant to Section 2
hereof or in connection with the Exchange Offer or pursuant to
its Existing Registration Obligations) proposes to register any
of its Common Stock under the Securities Act for sale to the
public, whether for its own account or for the account of other
securityholders or both (except with respect to registration
statements on Forms S-4 or S-8 (or any successor forms), a
registration pursuant to an employee benefit plan or a
registration of securities on a form which does not permit the
inclusion of securities sold in a secondary offering), it will
give written notice at such time to all holders of whom it is
aware of outstanding Registrable Stock of its intention to do so.
Upon the written request of any such holder, given within 30 days
after receipt of any such notice by the Company, to register any
of its Registrable Stock (in accordance, subject to the following
sentence, with the method of disposition being used by the
Company as specified in the Company's notice), the Company will
use its best efforts to cause the Registrable Stock as to which
registration shall have been so requested, to be included in the
securities to be covered by the registration statement proposed
to be filed by the Company, all to the extent requisite to permit
the sale or other disposition by the holder of such Registrable
Stock so requested to be registered. In the event that any
registration pursuant to this Section 3 shall be, in whole or in
part, an underwritten public offering of Common Stock, any
request by a holder pursuant to this Section 3 to register
Registrable Stock shall specify that either (i) such Registrable
Stock is to be included in the underwriting on the same terms and
conditions as the shares of Common Stock otherwise being sold
through underwriters under such registration or (ii) such
Registrable Stock is to be sold in the open market without any
underwriting, on terms and conditions comparable to those
normally applicable to offerings of common stock in reasonably
similar circumstances. The number of shares of Registrable Stock
to be included in such an underwriting may be reduced (pro rata
among the requesting holders based upon the number of shares so
requested to be registered) if and to the extent that the
managing underwriter shall be of the opinion that such inclusion
would adversely affect the marketing of the securities to be sold
by the Company therein, provided, however, that no reduction of
the number of shares of Registrable Stock so to be included in
such registration shall be made if any shares are to be included
therein for the account of any person other than the Company or
another holder pursuant to a demand registration right existing
at the date of this Agreement or permitted hereby.
Notwithstanding the foregoing, the Company may at any
time in its discretion withdraw, without the consent of any
requesting holders, a registration statement that the Company had
filed or proposed to file pursuant to this Section 3 and abandon
the proposed offering in which any requesting holder or holders
had requested to participate.
4. Registration Procedures.
(a) If and whenever the Company is required by the
provisions of Section 2 or 3 hereof to use its best efforts to
effect the registration of any of the Registrable Stock under the
Securities Act, the Company will:
(i) prepare (and afford a single counsel for the
selling holders of Registrable Stock reasonable opportunity
to review and comment thereon) and file with the Commission
as soon as practicable (but in a any event within 60 days of
receipt of a request from requesting holders pursuant to
Section 2 hereof) a registration statement on any form for
which the Company then qualifies or which counsel for the
Company shall deem appropriate and which form shall be
available for the underwritten sale of the Registrable Stock
(which, in the case of an underwritten public offering
pursuant to Section 2 hereof, shall be Form S-1, S-3 or
another form of general applicability satisfactory to the
managing underwriter selected as therein provided) with
respect to such securities and use its best efforts to cause
such registration statement to become effective and to
remain effective until, in the case of a firm commitment
underwritten public offering, until each underwriter has
completed the distribution of all securities purchased by
it, and, in the case of any other registration, until the
earlier of (x) the sale of all Registrable Stock covered
thereby and (y) 120 days after the effective date thereof.
(ii) prepare (and afford a single counsel for the
selling holders of Registrable Stock reasonable opportunity
to review and comment thereon) and file with the Commission
such amendments and supplements to such registration
statement and the prospectus used in connection therewith as
may be necessary to keep such registration statement
effective for the period specified in paragraph (i) above
and as comply with the provisions of the Securities Act with
respect to the disposition of all Registrable Stock covered
by such registration statement in accordance with the
method(s) of disposition set forth in such registration
statement for such period;
(iii) furnish to each seller and to each underwriter
such number of copies of the registration statement and the
prospectus included therein (including each preliminary
prospectus) as such persons may reasonably request in order
to facilitate the Public Sale of the Registrable Stock
covered by such registration statement;
(iv) use its best efforts to register or qualify the
Registrable Stock covered by such registration statement
under the securities or blue sky laws of such jurisdictions
as a majority in interest of the sellers of Registrable
Stock or, in the case of an underwritten public offering,
the managing underwriter, shall reasonably request (provided
that the Company will not be required to (x) qualify
generally to do business in any jurisdiction where it would
not otherwise be required to qualify but for this paragraph
(iv) or (y) take any action that would subject it to
taxation in any such jurisdiction or to general service of
process in any jurisdiction);
(v) immediately notify each seller under such
registration statement and each underwriter, at any time
when a prospectus relating thereto is required to be
delivered under the Securities Act, of the happening of any
event as a result of which the prospectus contained in such
registration statement, as then in effect, includes an
untrue statement of a material fact or omits to state any
material fact required to be stated therein or necessary to
make the statements therein not misleading in the light of
the circumstances then existing;
(vi) use its reasonable best efforts (if the offering
is underwritten) to furnish, at the request of holders of a
majority in interest of the Registrable Stock being sold, on
the date that Registrable Stock is delivered to the
underwriters for sale pursuant to such registration: (x) an
opinion, dated such date, of counsel representing the
Company for the purposes of such registration, addressed to
the underwriters and to such seller, stating that such
registration statement has become effective under the
Securities Act and that (A) to the knowledge of such
counsel, no stop order suspending the effectiveness thereof
has been issued and no proceedings for that purpose have
been instituted or are pending or contemplated under the
Securities Act, (B) the registration statement, the related
prospectus, and each amendment or supplement thereof, comply
as to form in all material respects with the requirements of
the Securities Act and the applicable rules and regulations
of the Commission thereunder (except that such counsel need
express no opinion as to financial statements contained
therein) and (C) to such other effects as are customarily
covered in such opinions given in connection with such
registrations and are reasonably requested by counsel for
the underwriters or by such sellers or their counsel, and
(y) a letter dated such date from the independent public
accountants retained by the Company, addressed to the
underwriters and to such sellers, stating that they are
independent public accountants within the meaning of the
Securities Act and that, in the opinion of such accountants,
the financial statements of the Company included in the
registration statement or the prospectus, or any amendment
or supplement thereof, comply as to form in all material
respects with the applicable accounting requirements of the
Securities Act, and such letter shall additionally cover
such other financial matters with respect to the
registration in respect of which such letter is being given
as are customarily covered in such letters given in
connection with such registrations and are reasonably
requested by such underwriters or sellers;
(vii) make available for inspection by each seller,
any underwriter participating in any distribution pursuant
to such registration statement, and any attorney, accountant
or other agent retained by such seller or underwriter, all
financial and other records, pertinent corporate documents
and properties of the Company, and cause the Company's
officers, directors and employees to supply all information
reasonably requested by any such seller, underwriter,
attorney, accountant or agent in connection with such
registration statement, in each case, subject to the
Company's prior receipt from such persons of appropriate
agreements to maintain the confidentiality of any such
records, documents and information; and
(viii) if such registration covers a firm commitment
underwritten public offering, enter into a written agreement
with the managing underwriter selected in the manner herein
provided in such form and containing such provisions as are
customary in the securities business for such an arrangement
between major underwriters and companies of the Company's
size and investment stature, provided that such agreement
shall not contain any such provision applicable to the
Company which is inconsistent with the provisions hereof and
provided, further, that the time and place of the closing
under said agreement shall be as mutually agreed upon
between the Company and such managing underwriter.
(b) In connection with each registration hereunder, the
selling holders of Registrable Stock will:
(i) furnish to the Company in writing such information with
respect to themselves and the proposed distribution by them
as shall be reasonably necessary in order to assure
compliance with federal and applicable state securities laws
or as shall reasonably be requested by the Company or its
counsel; and
(ii) not effect any public sale or distribution of the
issue being registered or any equity security of the
Company, or any securities convertible into or exchangeable
or exercisable for such equity securities, including a sale
pursuant to Rule 144 under the Securities Act, during the 14
days prior to, and during the 90-day period beginning on,
the effective date of such registration statement (except as
part of such registration), if and to the extent requested
by the Company or the managing underwriter.
(c) Each seller of Registrable Stock agrees that, upon
receipt of any notice from the Company of the happening of any
event of the kind described in Section 4(a)(v) that requires the
preparation of a supplement or amendment to such prospectus, such
seller will forthwith discontinue disposition of Registrable
Stock pursuant to the registration statement covering such
Registrable Stock until such seller's receipt of the copies of
the supplemented or amended prospectus, and, if so directed by
the Company, such seller will deliver to the Company all copies,
other than permanent file copies, then in such seller's
possession, of the most recent prospectus covering such
Registrable Stock at the time of receipt of such notice. In the
event the Company shall give such notice, the Company shall
extend the period during which such registration statement shall
be maintained effective by the number of days during the period
from and including the date of the giving of notice hereof to the
date when the Company shall make available to the sellers of
Registrable Stock a supplemented or amended prospectus.
(d) In connection with each registration pursuant to
Sections 2 and 3 hereof covering an underwritten public offering,
no holder of Registrable Stock may participate in any
registration hereunder unless such holder (i) agrees to sell its
Registrable Stock on the basis provided in the underwriting
arrangements applicable to such registration (appropriately
modified if such sales are not covered by such underwriting) and
(ii) completes and executes all questionnaires, powers of
attorney, indemnities, underwriting agreements and other
documents as are required to be executed under the terms of such
underwriting arrangements, subject, however, to the provisions of
Section 6 hereof.
5. Expenses. All expenses incurred by the Company in
complying with Sections 2 and 3 hereof, including without
limitation all registration and filing fees, printing expenses,
fees and disbursements of counsel and independent public
accountants for the Company, fees of the National Association of
Securities Dealers, Inc., transfer taxes, fees of transfer agents
and registrars, costs of insurance and reasonable fees and
expenses of a single counsel for the sellers of Registrable
Stock, but excluding any Selling Expenses, are herein called
"Registration Expenses." All underwriting discounts, selling
commissions and transfer taxes applicable to the sale of
Registrable Stock and any out-of-pocket expenses (other than the
single counsel described above) of the sellers (or agents who
manage their accounts) are herein called "Selling Expenses."
The Company will pay all Registration Expenses in
connection with each registration statement filed pursuant to
Section 2 or 3 hereof. All Selling Expenses in connection with
any registration statement filed pursuant to Section 2 or 3
hereof shall be borne by the participating sellers in proportion
to the number of shares sold by each, or by such persons other
than the Company (except to the extent the Company shall be a
seller) as they may agree.
6. Indemnification. In the event of a registration
of any of the Registrable Stock under the Securities Act pursuant
to Section 2 or 3 hereof, the Company will indemnify and hold
harmless each seller of such Registrable Stock thereunder and
each underwriter of Registrable Stock thereunder and each
officer, director and each other person, if any, who controls
such seller or underwriter within the meaning of the Securities
Act, against any losses, claims, damages or liabilities, joint or
several, to which such seller or underwriter or controlling
person becomes subject under the Securities Act or otherwise,
insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact
contained in any registration statement under which such
Registrable Stock was registered under the Securities Act
pursuant to Section 2 or 3, any preliminary prospectus or
final prospectus contained therein, or any amendment or
supplement thereof, 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, and will reimburse each such seller, each
such underwriter and each such controlling person for any
reasonable legal or other expenses reasonably incurred by them in
connection with investigating or defending any such loss, claim,
damage, liability or action, provided, however, that the Company
will not be liable in any such case if and to the extent that any
such loss, claim, damage or liability arises out of or is based
upon an untrue statement or alleged untrue statement or omission
or alleged omission so made in conformity with information
furnished by or on behalf of such seller, such underwriter or
such controlling person in writing specifically for use in such
registration statement or prospectus or any amendment or
supplement thereof.
In the event of a registration of any of the
Registrable Stock under the Securities Act pursuant to Section 2
or 3 hereof, each seller of such Registrable Stock thereunder,
severally and not jointly, will indemnify and hold harmless the
Company and each officer, director and each other person, if any,
who controls the Company within the meaning of the Securities
Act, each officer of the Company who signs the registration
statement, each director of the Company, each underwriter and
each person who controls any underwriter within the meaning of
the Securities Act, against all losses, claims, damages or
liabilities, joint or several, to which the Company or such
officer or director or underwriter or controlling person becomes
subject under the Securities Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon any untrue statement or
alleged untrue statement of any material fact contained in the
registration statement under which such Registrable Stock was
registered under the Securities Act pursuant to Section 2 or 3,
any preliminary prospectus or final prospectus contained therein,
or any amendment or supplement thereof, 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, and will reimburse the
Company and each such officer, director, underwriter and
controlling person for any reasonable legal or other expenses
reasonably incurred by them in connection with investigating or
defending any such loss, claim, damage, liability or action,
provided, however, that such seller will be liable hereunder in
any such case if and only to the extent that any such loss,
claim, damage or liability arises out of or is based upon an
untrue statement or alleged untrue statement or omission or
alleged omission made in conformity with information pertaining
to such seller, as such, furnished in writing to the Company by
such seller specifically for use in such registration statement
or prospectus or any amendment or supplement thereof, provided,
further, however, that the liability of each seller hereunder
shall be limited to the proportion of any such loss, claim,
damage, liability or expense which is equal to the proportion
that the public offering price of shares sold by such seller
under such registration statement bears to the total public
offering price of all securities sold thereunder, but not to
exceed the proceeds received by such seller from the sale of
Registrable Stock covered by such registration statement.
Promptly after receipt by an indemnified party
hereunder of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be
made against the indemnifying party hereunder, notify the
indemnifying party in writing thereof, but the omission so to
notify the indemnifying party shall not relieve it from any
liability which it may have to any indemnified party other than
under this Section 8. In case any such action shall be brought
against any indemnified party and it shall notify the
indemnifying party of the commencement thereof, the indemnifying
party shall be entitled to participate in and, to the extent it
shall wish, to assume and undertake the defense thereof with
counsel reasonably satisfactory to such indemnified party, and,
after notice from the indemnifying party to such indemnified
party of its election so to assume and undertake the defense
thereof, the indemnifying party shall not be liable to such
indemnified party under this Section 6 for any legal expenses
subsequently incurred by such indemnified party in connection
with the defense thereof, provided, however, that, if the
defendants in any such action include both the indemnified party
and the indemnifying party and, in the opinion of counsel
reasonably satisfactory to the indemnifying party a material
conflict of interest exists between the indemnifying party and
the indemnified party in connection with such action, the
indemnified party shall have the right to select a separate
counsel (reasonably acceptable to the Company) and to assume such
legal defenses and otherwise to participate in the defense of
such action, with the reasonable expenses and fees of such
separate counsel and other expenses related to such participation
to be reimbursed by the indemnifying party as incurred.
Notwithstanding the foregoing, any indemnified party
shall have the right to retain its own counsel in any such
action, but the fees and disbursements of such counsel shall be
at the expense of such indemnified party unless (i) the
indemnifying party shall have failed to retain counsel for the
indemnified person as aforesaid or (ii) the indemnifying party
and such indemnified party shall have mutually agreed to the
retention of such counsel. It is understood that the
indemnifying party shall not, in connection with any action or
related actions in the same jurisdiction, be liable for the fees
and disbursements of more than one separate firm qualified in
such jurisdiction to act as counsel for all indemnified parties.
The indemnifying party shall not be liable for any settlement of
any proceeding effected without its written consent, but if
settled with such consent or if there be a final judgment for the
plaintiff, the indemnifying party agrees to indemnify the
indemnified party from and against any loss or liability (to the
extent stated above) by reason of such settlement or judgment.
If the indemnification provided for in the first two
paragraphs of this Section 6 is unavailable or insufficient to
hold harmless an indemnified party under such paragraphs in
respect of any losses, claims, damages or liabilities or actions
in respect thereof referred to therein, then each indemnifying
party shall in lieu of indemnifying such indemnified party
contribute to the amount paid or payable by such indemnified
party as a result of such losses, claims, damages, liabilities or
actions in such proportion as appropriate to reflect the relative
fault of the Company, on the one hand, and the sellers of such
Registrable Stock, on the other, in connection with the
statements or omissions which resulted in such losses, claims,
damages, liabilities or actions as well as any other relevant
equitable considerations. The relative fault shall be determined
by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact relates to
information supplied by the Company, on the one hand, or the
sellers of such Registrable Stock, on the other, and to the
parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
The Company and the sellers of Registrable Stock agree that it
would not be just and equitable if contributions pursuant to this
paragraph were determined by pro rata allocation (even if all of
the sellers of such Registrable Stock were treated as one entity
for such purpose) or by any other method of allocation which did
not take account of the equitable considerations referred to
above in this paragraph. The amount paid or payable by an
indemnified party as a result of the losses, claims, damages,
liabilities or action in respect thereof, referred to above in
this paragraph, shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action or
claim. Notwithstanding the provisions of this paragraph, the
sellers of such Registrable Stock shall not be required to
contribute any amount in excess of the amount, if any, by which
the total price at which the Common Stock sold by each of them
was offered to the public exceeds the amount of any damages which
they would have otherwise been required to pay by reason of such
untrue or alleged untrue statement or omission. No person guilty
of fraudulent misrepresentations (within the meaning of Section
11(f) of the Securities Act), shall be entitled to contribution
from any person who is not guilty of such fraudulent
misrepresentation.
7. Changes in Common Stock. If, and as often as,
there are any changes in the Common Stock by way of stock split,
stock dividend, combination or reclassification, or through
merger, consolidation, reorganization or recapitalization, or by
any other means, appropriate adjustment shall be made in the
provisions hereof, as may be required, so that the rights and
privileges granted hereby shall continue with respect to the
Common Stock as so changed and shall apply to any securities
received in any such transaction.
8. Rule 144 Reporting. The Company covenants that it
will file any reports required to be filed by it under the
Securities Act and the Exchange Act and that it will take such
further action as any holder of Registrable Stock may reasonably
request, all to the extent required from time to time to enable
such holder to sell Registrable Stock without registration under
the Securities Act within the limitation of the exemptions
provided by Rule 144 under the Securities Act, as such Rule may
be amended from time to time. Upon the request of such holder,
the Company will deliver to such holder a written statement as to
whether it has complied with such requirements.
9. Other Registration Rights Agreements. (a) All
rights heretofore granted by the Company or Euro Brokers (i) to
the FSAC Management Stockholders relating to the registration of
the FSAC Management Shares or (ii) to the Investor Stockholders
or the EBIC Management Stockholders pursuant to the Registration
Rights Agreement dated as of May 19, 1994 (the "Original
Registration Rights Agreement") among Euro Brokers, the Investor
Stockholders and the EBIC Management Stockholders, are hereby
terminated and superseded by the rights granted by the Company as
provided in this Agreement, and the Original Registration Rights
Agreement and any and all previously existing registration rights
granted to the Management Stockholders or the Investor
Stockholders are hereby canceled, waived and shall have no
further force or effect. Notwithstanding the foregoing, nothing
in this Agreement shall cancel, waive or otherwise affect any of
the Existing Registration Obligations (or constitute a
cancellation or waiver of any rights of any person or entity
under any of the Existing Registration Obligations).
(b) Nothing herein shall prohibit or limit the Company from
entering into an agreement providing holders of securities which
may hereafter be issued by the Company with such registration
rights exercisable at such time or times and in such manner as
the Board of Directors shall deem in the best interests of the
Company so long as the performance by the Company of its
obligations under such other agreement will not cause the Company
to breach its obligations to the holders of Registrable Stock
hereunder.
10. Miscellaneous.
(a) All covenants and agreements contained in this
Agreement by or on behalf of any of the parties hereto,
including, without limitation, the rights to indemnification
under Section 6 hereof, shall bind and inure to the benefit of
the respective successors and assigns of the parties hereto
whether so expressed or not. Without limiting the generality of
the foregoing, the registration rights conferred herein on the
holders of Registrable Stock shall inure to the benefit of any
and all subsequent holders from time to time of the Registrable
Stock (but only so long as such Registrable Stock remains
Registrable Stock).
(b) So long as Registrable Stock remains subject to this
agreement, the Company will not enter into any merger,
consolidation, sale of substantially all of its assets or other
transaction in which it is not the surviving entity unless the
acquiror shall expressly assume by a supplemental agreement,
executed and delivered to the remaining holders of Registrable
Stock, in form satisfactory to holders of a majority of the
Registrable Stock then remaining, the due and punctual
performance of every covenant of this Agreement on the part of
the Company to be performed and observed with respect to the
Registrable Stock after such transaction.
(c) All notices, requests, consents and other
communications hereunder shall be in writing and shall be mailed
by first class registered mail, postage prepaid, addressed as
follows:
if to the Company, to it at 667 Madison Avenue,
11th Floor, New York, New York 10021, Attention:
Gilbert Scharf;
if to any holder of Registrable Stock, to it at
its address as set forth in Annex I, Annex II or Annex
III hereto;
if to any subsequent holder of Registrable Stock,
to it at such address as may have been furnished to the
Company in writing by such holder;
or, in any case, at such other address or addresses as shall have
been furnished in writing to the Company (in the case of a holder
of Registrable Stock), or to the holders of Registrable Stock (in
the case of the Company).
(d) THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
(e) This Agreement constitutes the entire agreement of the
parties with respect to the subject matter hereof, and supersedes
all other prior agreements and understandings, whether oral or
written, relating to the subject matter hereof. This Agreement
may not be modified or amended, and the provisions hereof may not
be waived, except in writing signed by each of (i) the Company,
(ii) Management Stockholders then holding, in the aggregate, a
majority of the Registrable Stock then held by all Management
Stockholders as a whole and (iii) Investor stockholders then
holding, in the aggregate, a majority of the Registrable Stock
then held by all Investor Stockholders as a whole.
(f) This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all
of which together shall constitute one and the same instrument,
and shall become effective as to each holder of Registrable Stock
upon such holder's execution of a counterpart after execution of
a counterpart by the Company.
(g) The Company shall not hereafter enter into any
agreement with respect to its securities that grants any person
or entity any registration rights with respect to the Company's
securities that take precedence over the rights granted to the
Stockholders hereunder, provided, however that the Company shall
have the right to grant registration rights on a basis
substantially identical to those provided in this Agreement with
respect to additional shares of Common Stock (or securities
convertible into or exercisable for shares of Common Stock)
issued to any stockholder.
Please indicate your acceptance of the foregoing by
signing and returning the enclosed counterpart of this Agreement,
whereupon this Agreement shall become binding upon the Company
and you.
Very truly yours,
FINANCIAL SERVICES ACQUISITION
CORPORATION
By /s/ Gilbert D. Scharf
Title:
AGREED TO AND ACCEPTED
as of the date first
above written.
WELSH, CARSON, ANDERSON & STOWE VI, L.P.
By WCAS VI Partners, L.P., General Partner
By /s/ Laura Van Buren
_________________________
General Partner
WCAS INFORMATION PARTNERS, L.P.
By WCAS INFO Partners, General Partner
By /s/ Laura Van Buren
_________________________
General Partner
/s/ Laura Van Buren,
Attorney-in-fact for
Patrick J. Welsh
__________________________
Patrick J. Welsh
/s/ Laura Van Buren,
Attorney-in-fact for
Russell L. Carson
__________________________
Russell L. Carson
/s/ Laura Van Buren,
Attorney-in-fact for
Bruce K. Anderson
___________________________
Bruce K. Anderson
/s/ Laura Van Buren,
Attorney-in-fact for
Richard H. Stowe
___________________________
Richard H. Stowe
DE CHARTER TRUST CO., as Trustee FBO
the IRA/Rollover of Richard H. Stowe
By /s/ Richard H. Stowe
___________________________
/s/ Thomas E. McInerney
_____________________________
Thomas E. McInerney
/s/ Andrew M. Paul
_____________________________
Andrew M. Paul
/s/ James B. Hoover
_____________________________
James B. Hoover
DE CHARTER TRUST CO., as Trustee FBO the
IRA/Rollover of James B. Hoover
By /s/ James B. Hoover
___________________________
/s/ Robert A. Minicucci
_____________________________
Robert A. Minicucci
/s/ Anthony J. DeNicola
_____________________________
Anthony J. DeNicola
/s/ Laura Van Buren
_____________________________
Laura Van Buren
David F. Bellet, Trustee, Profit Sharing Plan
DCJSC - Custodian FBO David F. Bellet
/s/ David F. Bellet
_____________________________
David F. Bellet
/s/ Donald R.A. Marshall
_____________________________
Donald R.A. Marshall
/s/ Alistair H. Johnstone
_____________________________
Alistair H. Johnstone
/s/ Keith E. Reihl
_____________________________
Keith E. Reihl
/s/ Brian G. Clark
_____________________________
Brian G. Clark
/s/ Walter E. Dulski
_____________________________
Walter E. Dulski
/s/ Gilbert Scharf
_____________________________
Gilbert Scharf
/s/ Michael J. Scharf
_____________________________
Michael J. Scharf
/s/ Denis Martin
_____________________________
Denis Martin
/s/ Larry S.Kopp
_____________________________
Larry S. Kopp
/s/ William D. Birch
_____________________________
William D. Birch
/s/ Frederick B. Whittemore
_____________________________
Frederick B. Whittemore
ANNEX I
Investor Stockholders
Welsh, Carson, Anderson & Stowe VI,
L.P.
WCAS Information Partners, L.P.
Patrick J. Welsh
Russell L. Carson
Bruce K. Anderson
Richard H. Stowe
DE Charter Trust Co., as Trustee
FBO the IRA/Rollover of
Richard H. Stowe
Thomas E. McInerney
Andrew M. Paul
James B. Hoover
DE Charter Trust Co., as Trustee
FBO the IRA/Rollover of
James B. Hoover
Robert A. Minicucci
Anthony J. deNicola
Laura Van Buren
David F. Bellet, Trustee, Profit
Sharing Plan DLJSC - Custodian
FBO David F. Bellet
c/o Welsh, Carson, Anderson
& Stowe
One World Financial Center
New York, New York 10281
ANNEX II
EBIC Management Stockholders
Donald R.A. Marshall
[Address]
Alistair H. Johnstone
[Address]
Keith E. Reihl
[Address]
Brian G. Clark
[Address]
Walter E. Dulski
[Address]
ANNEX III
FSAC Management Stockholders
Gilbert Scharf
[Address]
Michael J. Scharf
[Address]
Denis Martin
[Address]
Larry S. Kopp
[Address]
William D. Birch
[Address]
Frederick B. Whittemore
[Address]
Financial Services Acquisition Corporation
FOR IMMEDIATE RELEASE
FSAC STOCKHOLDERS APPROVE MERGER AGREEMENT TO ACQUIRE EURO
BROKERS INVESTMENT CORPORATION
NEW YORK, NEW YORK - AUGUST 15, 1996 - Financial Services
Acquisition Corporation (FSAC) announced today that its
stockholders have approved FSAC's previously announced proposal
to acquire Euro Brokers Investment Corporation, (Euro Brokers)
with Euro Brokers to become a wholly owned subsidiary of FSAC.
The stockholders of Euro Brokers previously approved the
acquisition in July. FSAC expects to consummate the acquisition
by the close of the day on Friday, August 16, 1996.
FSAC is a public company specifically organized for the
purpose of acquiring an operating business in the financial
services industry.
Euro Brokers is a privately held international and domestic
inter-dealer broker for a broad range of financial instruments.
(Contact: FSAC - Gilbert Scharf, Chairman and C.E.O., 667
Madison Avenue, New York, NY 10021 (212) 317-1000).
FSAC
667 Madison Avenue, New York, New York 10021 Tel. 212-246-1000
Fax. 212-246-1514
Financial Services Acquisition Corporation
FOR IMMEDIATE RELEASE
FINANCIAL SERVICES ACQUISITION CORPORATION ACQUIRES EURO
BROKERS, A LEADING INTER-DEALER BROKERAGE
New York, New York - August 16, 1996: Financial Services
Acquisition Corporation (FSAC) announced today that it
has completed the acquisition of Euro Brokers Investment
Corporation.
As a result of the acquisition, Euro Brokers became
a wholly-owned subsidiary of FSAC and each former holder
of Euro Brokers common stock is entitled to receive per
share consideration consisting of approximately (i) 2.43
shares of FSAC common stock, (ii) 4.53 redeemable common
stock purchase warrants of FSAC and (iii) $11.94 in cash.
In addition, approximately .27 shares of FSAC common
stock and $1.20 in cash have been deposited in escrow
with respect to each share formerly held by Euro Brokers
stockholders, for possible release to such stockholders
pending certain post-merger adjustments.
Gilbert Scharf, Chairman, President and Chief
Executive Officer of FSAC, stated: "This is an
outstanding acquisition and an exciting day for FSAC's
stockholders. Euro Brokers is one of the world's leading
inter-dealer brokerage firms that specializes in money
market instruments, derivatives and fixed income
securities. It has a technologically advanced
international infrastructure and a very strong management
team. We are looking forward to working with Donald
Marshall and the team at Euro Brokers to take advantage
of our growth potential and establish Euro Brokers as the
pre-eminent broker in each of its products and certain
new products as well."
Euro Brokers had net income of approximately $3.5
million on revenues of approximately $174 million for the
year ended 1995 and net income of approximately $3.5
million on revenues of approximately $49 million for the
three months ended March 31, 1996 (unaudited).
Donald R.A. Marshall, the current President and
Chief Executive Officer of Euro Brokers, who will remain
in such positions and also become Vice-Chairman of FSAC,
said: "We are delighted to join forces with Gil Scharf,
who has had a distinguished record in the securities
business while occupying important positions at Morgan
Stanley and Lazard Brothers in London. The acquisition
rewards Euro Brokers stockholders for the firm's past
successes and, through the alliance with FSAC, positions
Euro Brokers to achieve continued dynamic growth."
In connection with the acquisition, FSAC
stockholders also elected a slate of eight directors,
adopted a stock option plan and approved charter
amendments that, among other things, increased FSAC's
authorized share capital, eliminated the ability of
stockholders to act by written consent and to call
special stockholder meetings and implemented a three-
class staggered board of directors. A proposal to change
FSAC's name was withdrawn prior to the vote. FSAC also
consummated a previously-announced agreement providing
for the exchange of an aggregate of 225,000 newly-issued
shares of its common stock for all 333,333 of its
outstanding unit purchase options granted to its original
underwriters.
(Contact: FSAC - Gilbert D. Scharf, Chairman, President
and Chief Executive Officer, 667 Madison avenue, New
York, NY 10021 -- (212) 317-1000)
