{"id":43633,"date":"2015-09-17T11:25:58","date_gmt":"2015-09-17T16:25:58","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/contracts\/uncategorized\/stock-option-agreement-e-trade-group-inc-and-telebanc.html"},"modified":"2015-09-17T11:25:58","modified_gmt":"2015-09-17T16:25:58","slug":"stock-option-agreement-e-trade-group-inc-and-telebanc","status":"publish","type":"corporate_contracts","link":"https:\/\/corporate.findlaw.com\/contracts\/planning\/stock-option-agreement-e-trade-group-inc-and-telebanc.html","title":{"rendered":"Stock Option Agreement &#8211; E*Trade Group Inc. and Telebanc Financial Corp."},"content":{"rendered":"<pre>                           STOCK OPTION AGREEMENT\n\n\n          STOCK OPTION AGREEMENT (the 'Agreement'), dated as of May 31, 1999, by\nand between, E*TRADE Group, Inc., a Delaware corporation ('Parent'), and\nTelebanc Financial Corporation, a Delaware corporation ('Company').  Capitalized\nterms used herein but not defined herein shall have the meanings set forth in\nthe Reorganization Agreement referred to below.\n\n          WHEREAS, concurrently with the execution and delivery of this\nAgreement, Company, Parent and Turbo Acquisition Corp., a Delaware corporation\nand wholly-owned subsidiary of Parent ('Merger Sub'), are entering into an\nAgreement and Plan of Merger and Reorganization, dated as of the date hereof\n(the 'Reorganization Agreement'), pursuant to which, among other things, upon\nthe terms and subject to the conditions thereof, Merger Sub will be merged with\nand into Company (the 'Merger'), with Company continuing as the surviving\ncorporation; and\n\n          WHEREAS, as a condition and inducement to Parent's willingness to\nenter into the Reorganization Agreement, Parent has required that Company agree,\nand Company has agreed, to grant to Parent an option to purchase certain newly\nissued shares of Company's Common Stock, par value $.01 per share ('Company\nCommon Stock'), upon the terms and subject to the conditions set forth herein;\n\n          NOW, THEREFORE, in consideration of the foregoing and of the mutual\ncovenants and agreements set forth herein and in the Reorganization Agreement,\nthe parties hereto agree as follows:\n\n          1.  Grant of Option.  Company hereby grants to Parent an irrevocable \n              ---------------\noption (the 'Company Option') to purchase up to 3,369,881 shares (the 'Company\nShares') of Company Common Stock' in the manner set forth below at a price\n(the 'Exercise Price') of $93.45 per Company Share, payable in cash.\n\n          2.  Exercise of Option.  (a)  The Company Option may be exercised by \n              ------------------\nParent, in whole or in part at any time or from time to time after (i) the\noccurrence of any of the events described in Section 7.3(b) of the\nReorganization Agreement or (ii) immediately prior to the occurrence of any of\nthe events which obligate Company to pay Parent the Termination Fee pursuant\nto section 7.3(c) of the Reorganization Agreement. In the event Parent wishes\nto exercise the Company Option, Parent shall deliver to Company a written\nnotice (an 'Exercise Notice') specifying the total number of Company Shares it\nwishes to purchase; provided that, if prior notification to or approval of the\n                    --------\nOffice of Thrift Supervision (the 'OTS') or any other regulatory or antitrust\nagency is required in connection with such purchase, Parent shall promptly\nfile the required notice or application for approval, shall promptly notify\nCompany of such filing, and shall expeditiously process the same and the\nperiod of time that otherwise would run pursuant to this sentence shall run\ninstead from the date on which any required notification periods have expired\nor been terminated or such approvals have been obtained and any requisite\nwaiting period or periods shall have passed. Each closing of a purchase of\nCompany Shares (an\n\n \n'Option Closing') shall occur at a place, on a date and at a time designated\nby Parent in an Exercise Notice delivered at least two business days prior to\nthe date of the Option Closing. The Company Option shall terminate upon the\nearlier of: (w) the Effective Time; (x) the termination of the Reorganization\nAgreement pursuant to Section 7.1 thereof (other than a termination in\nconnection with which Parent is entitled to any payments as specified in\nSections 7.3(b) or (c) thereof); (y) 180 days following any termination of the\nReorganization Agreement in connection with which Parent is entitled to a\npayment as specified in Section 7.3(b) thereof (or if, at the expiration of\nsuch 180 day period, the Company Option cannot be exercised by reason of any\napplicable judgment, decree, order, law or regulation, twenty (20) business\ndays after such impediment to exercise shall have been removed or shall have\nbecome final and not subject to appeal); or (z) 180 days following the\noccurrence of any event in connection with which Parent has become entitled to\npayment of the Termination Fee pursuant to Section 7.3(c) of the\nReorganization Agreement (or if, at the expiration of such 180 day period, the\nCompany Option cannot be exercised by reason of any applicable judgment,\ndecree, order, law or regulation, twenty (20) business days after such\nimpediment to exercise shall have been removed or shall have become final and\nnot subject to appeal).\n\n     (b) Notwithstanding any other provision of this Agreement or the\nReorganization Agreement, in no event shall Parent's Total Profit (as\nhereinafter defined) exceed in the aggregate $90,000,000 and, if it otherwise\nwould exceed such amount Parent, in its sole discretion, shall either (i) reduce\nthe number of Company Shares subject to the Company Option, (ii) pay cash to\nCompany, (iii) receive a smaller Termination Fee (as defined in Section 7.3(b)\nof the Reorganization Agreement) or (iv) any combination thereof, so that\nParent's actually realized Total Profit shall not exceed in the aggregate\n$90,000,000 after taking into account the foregoing actions.\n\n     (c) As used herein, the term 'Total Profit' shall mean the sum of (i) (x)\nthe amount (before taxes but net of reasonable and customary commissions paid or\npayable in connection with such transaction) received by parent pursuant to the\nsale of Company Shares less (y) Parent's purchase price for such Company Shares,\n(ii) any amounts (before taxes but net of reasonable and customary commissions\npaid or payable in connection with such transaction) received by parent on the\ntransfer of the Company Option (or any portion thereof) to any unaffiliated\nPerson(s) (if permitted hereunder) or to Company and (iii) the amount received\nby Parent pursuant to Section 7.3(b) or Section 7.3(c) of the Reorganization\nAgreement.\n\n          3.  Conditions to Closing.  The obligation of Company to issue the \n              ---------------------\nCompany Shares to Parent hereunder is subject to the conditions that (i) all\nconsents, approvals, orders or authorizations of, or registrations,\ndeclarations or filings with, any Governmental Entity or Regulatory Entity if\nany, required in connection with the issuance of the Company Shares hereunder\nshall have been obtained or made, as the case may be; and (ii) no preliminary\nor permanent injunction or other order by any court of competent jurisdiction\nprohibiting or otherwise restraining such issuance shall be in effect.\n\n          4.  Closing.  At each Option Closing, (a) Company will deliver to \n              -------\nParent a certificate or certificates in definitive form representing the\nnumber of Company Shares\n\n                                       2\n\n \ndesignated by Parent in its Exercise Notice, such certificate or certificates\nto be registered in the name of Parent or its designee and to bear the legend\nset forth in Section 10, and (b) Parent will deliver to Company the aggregate\nExercise Price for the Company Shares so designated by wire transfer of\nimmediately available funds or certified check or bank check. At any Option\nClosing at which Parent is exercising the Company Option in part, Parent shall\npresent and surrender this Agreement to Company, and Company shall deliver to\nParent an executed new agreement with the same terms as this Agreement\nevidencing the right to purchase the remaining balance of the shares of\nCompany Common Stock purchasable hereunder.\n\n          5.  Representations and Warranties of Company.  Company represents \n              -----------------------------------------\nand warrants to Parent that (a) Company is a corporation duly organized,\nvalidly existing and in good standing under the laws of the State of Delaware\nand has the corporate power and authority to enter into this Agreement and to\ncarry out its obligations hereunder, (b) the execution and delivery of this\nAgreement by Company and the consummation by Company of the transactions\ncontemplated hereby have been duly authorized by all necessary corporate\naction on the part of Company and no other corporate proceedings on the part\nof Company are necessary to authorize this Agreement or any of the\ntransactions contemplated hereby, (c) this Agreement has been duly executed\nand delivered by Company and constitutes a valid and binding obligation of\nCompany, enforceable against Company in accordance with its terms, except as\nsuch enforceability may be limited by bankruptcy and other laws affecting the\nrights and remedies of creditors generally and general principles of equity,\n(d) Company has taken all action necessary to authorize and reserve for\nissuance and to permit it to issue, upon exercise of the Company Option, and\nat all times from the date hereof through the expiration of the Company Option\nwill have reserved, that number of unissued Company Shares that are subject to\nthe Company Option, all of which, upon their issuance and delivery in\naccordance with the terms of this Agreement, will be validly issued, fully\npaid and nonassessable, (e) upon delivery of the Company Shares to Parent upon\nthe exercise of the Company Option, Parent will acquire the Company Shares\nfree and clear of all liens, claims, charges, encumbrances and security\ninterests of any nature whatsoever except those imposed by Parent, (f)\nassuming that the consents approvals, authorizations, permits, filings and\nnotifications referred to in subsection (g) are obtained or made, as\napplicable, the execution and delivery of this Agreement by Company does not,\nand the performance of this Agreement by Company will not, conflict with, or\nresult in any violation of, or default (with or without notice or lapse of\ntime, or both) under, or give rise to a right of termination, cancellation or\nacceleration of any obligation or the loss of a benefit under, or the creation\nof a lien, pledge, security interest or other encumbrance on assets pursuant\nto (any such conflict, violation, default, right of termination, cancellation\nor acceleration, loss or creation, a 'Violation'), (A) any provision of the\nAmended and Restated Certificate of Incorporation or By-laws, each as amended,\nof Company or (B) any provisions of any material mortgage, indenture, lease,\ncontract or other agreement, instrument, permit, concession, franchise, or\nlicense or (C) any judgment, order, decree, statute, law, ordinance, rule or\nregulation applicable to Company or its properties or assets, except in the\ncase of clauses (B) and (C) immediately above, for violations which would not,\nindividually or in the aggregate, have a Material Adverse Effect on Company\nand (g) except as described in Section 2.3 of the Reorganization Agreement,\nthe execution and delivery of this Agreement by Company does not, and the\nperformance of this Agreement by Company will not, require any \n\n                                       3\n\n \nconsent, approval, authorization or permit of, or filing with or notification\nto, any Governmental Entity or Regulatory Entity.\n\n          6.  Representations and Warranties of Parent.  Parent represents and \n              ----------------------------------------\nwarrants to Company that (a) Parent is a corporation duly organized, validly\nexisting and in good standing under the laws of the State of Delaware and has\nthe corporate power and authority to enter into this Agreement and to carry\nout its obligations hereunder, (b) the execution and delivery of this\nAgreement by Parent and the consummation by Parent of the transactions\ncontemplated hereby have been duly authorized by all necessary corporate\naction on the part of Parent and no other corporate proceedings on the part of\nParent are necessary to authorize this Agreement or any of the transactions\ncontemplated hereby, (c) this Agreement has been duly executed and delivered\nby Parent and constitutes a valid and binding obligation of Parent,\nenforceable against Parent in accordance with its terms, except as such\nenforceability may be limited by bankruptcy and other laws affecting the\nrights and remedies of creditors generally and general principles of equity,\n(d) assuming that the consents, approvals, authorizations, permits, filings\nand notifications referred to in subsection (e) are obtained or made, as\napplicable, the execution and delivery of this Agreement by Parent does not,\nand the performance of this Agreement by Parent will not, result in any\nViolation pursuant to, (A) any provision of the Certificate of Incorporation\nor By-laws, each as amended, of Parent, (B) any provisions of any material\nmortgage, indenture, lease, contract or other agreement, instrument, permit,\nconcession, franchise, or license or (C) any judgment, order, decree, statute,\nlaw, ordinance, rule or regulation applicable to Parent or its properties or\nassets, except in the case of each of clauses (B) and (C) immediately, above,\nfor Violations which would not, individually or in the aggregate, have a\nMaterial Adverse Effect on Parent, (e) except as described in Section 3.3 of\nthe Reorganization Agreement and Section 3(a) of this Agreement, and except as\nmay be required under the Exchange Act, the execution and delivery of this\nAgreement by Parent does not, and the performance of this Agreement by Parent\nwill not, require any consent, approval, authorization or permit of, or filing\nwith or notification to, any Governmental Entity or Regulatory Entity and (f)\nany Company Shares acquired upon exercise of the Company Option will not be,\nand the Company Option is not being, acquired by Parent with a view to the\npublic distribution thereof and Parent will not sell or otherwise dispose of\nsuch shares in violation of applicable law or this Agreement.\n\n          7.  Registration Rights.\n              ------------------- \n\n              (a)  Following any exercise of the Company Option, Parent may by\nwritten notice (the 'Registration Notice') to Company request Company to\nregister under the Securities Act all or any part of the shares of Company\nCommon Stock acquired pursuant to this Agreement, including any voting\nsecurities issued by way of dividend, distribution or otherwise in respect\nthereof (the 'Restricted Shares'), beneficially owned by Parent (the\n'Registrable Securities') in order to permit the sale or other distribution of\nsuch Registrable Securities, including pursuant to a firm commitment\nunderwritten public offering; provided, however, that any such Registration\n                              --------  -------                            \nNotice must relate to a number of shares equal to at least 2% of the\noutstanding shares of Company Common Stock and that any rights to require\nregistration hereunder shall terminate with respect to any Shares that may\nbe sold in any 90-day period pursuant to Rule 144 under the Securities Act.\nThe Registration Notice shall include a certificate executed by Parent and\nits proposed managing underwriter, which underwriter shall be an \n\n                                       4\n\n \ninvestment banking firm of nationally recognized standing and reasonably\nacceptable to the Company (the 'Manager'), stating that Manager in good faith\nbelieves that, based on the then prevailing market conditions, it will be able\nto sell the Registrable Securities at a per share price equal to at least 90%\nof the Fair Market Value of such shares. For purposes of this Section 8, the\nterm 'Fair Market Value' shall mean the per share average of the closing sale\nprices of Company's Common Stock on the Nasdaq National Market for the twenty\n(20) trading days immediately preceding the date of the Registration Notice.\n\n              (b) Company shall use commercially reasonable efforts to effect,\nas promptly as practicable, the registration under the Securities Act of the\nunpurchased Registrable Securities; provided, however, that (i) Parent shall\n                                    --------  -------\nnot be entitled to more than two effective registration statements hereunder\nand (ii) Company will not be required to file any such registration statement\nduring any period of time (not to exceed 40 days after such request in the\ncase of clause (A) below or 90 days in the case of clauses (B) and (C) below)\nwhen (A) Company is in possession of material non-public information which it\nreasonably believes would be detrimental to be disclosed at such time and,\nbased on consultation with counsel to Company, such information would have to\nbe disclosed if a registration statement were filed at that time; (B) Company\nis required under the Securities Act to include audited financial statements\nfor any period in such registration statement and such financial statements\nare not yet available for inclusion in such registration statement; or (C)\nCompany determines, in its reasonable good faith, judgment, that such\nregistration would interfere with any financing, acquisition or other material\ntransaction involving Company or any of its affiliates. If consummation of the\nsale of any Registrable Securities pursuant to a registration hereunder does\nnot occur within 180 days after the filing with the SEC of the initial\nregistration statement, then such registration shall not be taken into account\nas an effective registration for purposes of clause (i) above. Company shall\nuse commercially reasonable efforts to cause any Registrable Securities\nregistered pursuant to this Section 8 to be qualified for sale under the\nsecurities or Blue Sky laws of such jurisdictions as Parent may reasonably\nrequest and shall continue such registration or qualification in effect in\nsuch jurisdiction; provided, however, that Company shall not be required to\n                   --------  -------\nqualify to do business in, or consent to general service of process in, any\njurisdiction by reason of this provision.\n\n              (c) The registration rights set forth in this Section 8 are\nsubject to the condition that Parent shall provide Company with such\ninformation with respect to Parent's Registrable Securities, the plans for the\ndistribution thereof, and such other information with respect to Parent as, in\nthe reasonable judgment of counsel for Company, is necessary to enable Company\nto include in such registration statement all material facts required to be\ndisclosed with respect to a registration thereunder.\n\n              (d) If Company securities of the same type as the Registrable\nSecurities are then authorized for quotation or trading or listing on the New\nYork Stock Exchange, the Nasdaq National Market, or any other securities\nexchange or automated quotations system, Company, upon the request of Parent,\nshall promptly file an application, if required, to authorize for quotation,\ntrading or listing the shares of Registrable Securities on such exchange or\nsystem and will use its reasonable best efforts to obtain approval, if\nrequired, of such quotation, trading or listing as soon as practicable.\n\n                                       5\n\n \n              (e) A registration effected under this Section 7 shall be\neffected at Company's expense, except for underwriting discounts and\ncommissions and fees and expenses of counsel to Parent, and Company shall\nprovide to the underwriters such documentation (including certificates,\nopinions of counsel and 'comfort' letters from auditors) as are customary in\nconnection with underwritten public offerings as such underwriters may\nreasonably require. In connection with any such registration, the parties\nagree (i) to indemnify each other and the underwriters in the customary manner\nand (ii) to enter into an underwriting agreement in form and substance\ncustomary for transactions of the type contemplated hereby with the Manager\nand the other underwriters participating in such offering.\n\n          8.  Adjustment Upon Changes in Capitalization.\n              -----------------------------------------\n\n              (a) In the event of any change in Company Common Stock by reason\nof stock dividends, splits, mergers (other than the Merger),\nrecapitalizations, combinations, exchange of shares or the like, the type and\nnumber of shares or securities subject to the Company Option, and the Exercise\nPrice per share, shall be adjusted appropriately, and proper provision shall\nbe made in the agreements governing such transaction so that Parent shall\nreceive, upon exercise of the Company Option, the number and class of shares\nor other securities or property that Parent would have received in respect of\nthe Company Common Stock if the Company Option had been exercised immediately\nprior to such event or the record date therefor, as applicable.\n\n              (b) In the event that Company shall enter in an agreement: (i)\nto consolidate with or merge into any person, other than Parent or any of its\nSubsidiaries, and shall not be the continuing or surviving corporation of such\nconsolidation or merger; (ii) to permit any person, other than Parent or one\nof its subsidiaries, to merge into Company and Company shall be the continuing\nor surviving corporation, but, in connection with such merger, the then-\noutstanding shares of Company Common Stock shall be changed into or exchanged\nfor stock or other securities of Company or any other person or cash or any\nother property or the outstanding shares of Company Common Stock immediately\nprior to such merger shall after such merger represent less than 50% of the\noutstanding shares and share equivalents of the merged company; or (iii) to\nsell or otherwise transfer all or substantially all of its assets to any\nperson, other than Parent or any of its Subsidiaries, then, and in each such\ncase, the agreement governing such transaction shall make proper provision so\nthat upon the consummation of any such transaction and upon the terms and\nconditions set forth herein, Parent shall receive for each Company Share with\nrespect to which the Company Option has not been exercised an amount of\nconsideration in the form of and equal to the per share amount of\nconsideration that would be received by the holder of one share of Company\nCommon Stock less the Exercise Price (and, in the event of an election or\nsimilar arrangement with respect to the type of consideration to be received\nby the holders of Company Common Stock, subject to the foregoing, proper\nprovision shall be made so that the holder of the Company Option would have\nthe same election or similar rights as would the holder of the number of\nshares of Company Common Stock for which the Company Option is then\nexercisable).\n\n          9.  Certain Agreements of Company.  Company agrees: (1) that it will \n              -----------------------------\nnot, by charter amendment or through reorganization, consolidation, merger,\ndissolution or sale of \n\n                                       6\n\n \nassets, or by any other voluntary act, avoid or seek to avoid the observance\nor performance of any of the covenants, stipulations or conditions to be\nobserved or performed hereunder by Company and (2) promptly to take all action\nas may from time to time be required (including (x) complying with all\napplicable premerger notification, reporting and waiting period requirements\nspecified in 15 U.S.C. Section 18a and regulations promulgated thereunder and\n(y) in the event that, under the Home Owners' Loan Act, as amended, or any\nstate or other federal banking law, prior approval of or notice to the OTS or\nto any state or other federal regulatory authority is necessary before the\nOption may be exercised, cooperating fully with Parent in preparing such\napplications or notices and providing such information to the OTS or such\nstate or other federal regulatory authority as they may require) in order to\npermit Parent to exercise the Option and Company duly and effectively to issue\nshares of Company Common Stock pursuant hereto.\n\n          10.  Restrictive Legends.  Each certificate representing shares of \n               -------------------\nCompany Common Stock issued to Parent hereunder shall, to the extent\napplicable, include a legend in substantially the following form:\n\n          THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN\nREGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY BE REOFFERED OR\nSOLD ONLY IF SO REGISTERED OR IF AN EXEMPTION FROM SUCH REGISTRATION IS\nAVAILABLE.  SUCH SECURITIES ARE ALSO SUBJECT TO ADDITIONAL RESTRICTIONS ON\nTRANSFER AS SET FORTH IN THE STOCK OPTION AGREEMENT, DATED AS OF MAY 31, 1999, A\nCOPY OF WHICH MAY BE OBTAINED FROM THE ISSUER.\n\n          11.  Binding Effect; No Assignment.  This Agreement shall be binding \n               -----------------------------\nupon and inure to the benefit of the parties hereto and their respective\nsuccessors and permitted assigns. Neither this Agreement nor the rights or the\nobligations of either party hereto are assignable, except by operation of law,\nor with the written consent of the other party. Nothing contained in this\nAgreement, express or implied, is intended to confer upon any person other\nthan the parties hereto and their respective permitted assigns any rights or\nremedies of any nature whatsoever by reason of this Agreement. Any Restricted\nShares sold by Parent in compliance with the provisions of Section 7 shall,\nupon consummation of such sale, be free of the restrictions imposed with\nrespect to such shares by this Agreement, unless and until Parent shall\nrepurchase or otherwise become the beneficial owner of such shares, and any\ntransferee of such shares shall not be entitled to the rights of Parent.\nCertificates representing shares sold in a registered public offering pursuant\nto Section 7 shall not be required to bear the legend set forth in Section 10.\n\n          12.  Specific Performance. The parties recognize and agree that if\n               --------------------\nfor any reason any of the provisions of this Agreement are not performed in\naccordance with their specific terms or are otherwise breached, immediate and\nirreparable harm or injury would be caused for which money damages would not\nbe an adequate remedy. Accordingly, each party agrees that, in addition to\nother remedies, the other party shall be entitled to an injunction restraining\nany violation or threatened violation of the provisions of this Agreement. In\nthe event that any action should be brought in equity to enforce the\nprovisions of this Agreement, neither party will allege, and each party hereby\nwaives the defense, that there is an adequate remedy at law.\n\n                                       7\n\n \n          13.  Entire Agreement. This Agreement and the Reorganization\n               ----------------\nAgreement (including the Company Disclosure Schedule and the Parent Disclosure\nSchedule relating thereto) constitute the entire agreement among the parties\nwith respect to the subject matter hereof and supersede all other prior\nagreements and understandings, both written and oral, among the parties or any\nof them with respect to the subject matter hereof.\n\n          14.  Further Assurance. Each party will execute and deliver all such\n               -----------------\nfurther documents and instruments and take all such further action as may be\nnecessary in order to consummate the transactions contemplated hereby.\n\n          15.  Validity. The invalidity or unenforceability of any provision of\n               --------\nthis Agreement shall not affect the validity or enforceability of the other\nprovisions of this Agreement, which shall remain in full force and effect. In\nthe event any court or other competent authority holds any provision of this\nAgreement to be null, void or unenforceable, the parties hereto shall\nnegotiate in good faith the execution and delivery of an amendment to this\nAgreement in order, as nearly as possible, to effectuate, to the extent\npermitted by law, the intent of the parties hereto with respect to such\nprovision. Each party agrees that, should any court or other competent\nauthority hold any provision of this Agreement or part hereof to be null, void\nor unenforceable, or order any party to take any action inconsistent herewith,\nor not take any action required herein, the other party shall not be entitled\nto specific performance of such provision or part hereof or to any other\nremedy, including but not limited to money damages, for breach hereof or of\nany other provision of this Agreement or part hereof as the result of such\nholding or order.\n\n          16.  Notices. Any notice or communication required or permitted\n               -------\nhereunder shall be in writing and either delivered personally, telegraphed or\ntelecopied or sent by certified or registered mail, postage prepaid, and shall\nbe deemed to be given, dated and received when so delivered personally,\ntelegraphed or telecopied or, if mailed, five business days after the date of\nmailing to the following address or telecopy number, or to such other address\nor addresses as such person may subsequently designate by notice given\nhereunder.\n\n               (a)  if to Parent or Merger Sub, to:\n\n                    E*TRADE Group, Inc.\n                    Four Embarcadero Place\n                    2400 Geng Road\n                    Palo Alto, CA  94303\n                    Attention: Thomas A. Bevilacqua, Esq.\n                    Facsimile No.:  (650) 842-8781\n                    Telephone No.:  (650) 842-2475\n \n                    with a copy to:\n \n                    Brobeck, Phleger &amp; Harrison LLP\n                    2200 Geng Road\n                    Two Embarcadero Place\n\n                                       8\n\n \n                    Palo Alto, CA  94303\n                    Attention: Curtis L. Mo, Esq.\n                    Facsimile No.:  (650) 496-2885\n\n                    and\n\n\n\n                    Brobeck, Phleger &amp; Harrison LLP\n                    Spear Street Tower\n                    One Market\n                    San Francisco, CA  94105\n                    Attention:  J. Michael Shepherd, Esq.\n                                Steve L. Camahort, Esq.\n                    Facsimile No.:  (415) 442-1010\n\n               (b)  if to Company, to:\n                    Telebanc Financial Corporation\n                    1111 North Highland Street\n                    Arlington, VA  22201-2807\n                    Attention:  President\n                    Facsimile No.:  (703) 524-0556\n\n                    with a copy to:\n\n                    Hogan &amp; Hartson LLP\n                    Columbia Square\n                    555 Thirteenth Street, N.W.\n                    Washington D.C. 20204\n                    Attention:   Steven Museles, Esq.\n                                 Stuart Stein, Esq.\n                    Facsimile No.:   (202) 637-5600\n\n\n          17.  Governing Law. This Agreement shall be governed by and construed\n               -------------\nin accordance with the laws of the State of Delaware applicable to agreements\nmade and to be performed entirely within such State without regard to any\napplicable conflicts of law rules.\n\n          18.  Descriptive Headings. The descriptive headings herein are\n               --------------------\ninserted for convenience of reference only and are not intended to be part of\nor to affect the meaning or interpretation of this Agreement.\n\n                                       9\n\n \n          19.  Counterparts. This Agreement may be executed in counterparts,\n               ------------\neach of which shall be deemed to be an original, but all of which, taken\ntogether, shall constitute one and the same instrument.\n\n          20.  Expenses. Except as otherwise expressly provided herein or in\n               --------\nthe Reorganization Agreement, all costs and expenses incurred in connection\nwith the transactions contemplated by this Agreement shall be paid by the\nparty incurring such expenses.\n\n          21.  Amendments; Waiver. This Agreement may be amended by the parties\n               ------------------\nhereto and the terms and conditions hereof may be waived only by an instrument\nin writing signed on behalf of each of the parties hereto, or, in the case of\na waiver, by an instrument signed on behalf of the party waiving compliance.\n\n                                       10\n\n \n          IN WITNESS WHEREOF, the parties hereto have caused this Agreement to\nbe executed by their respective duly authorized officers as of the date first\nabove written.\n\n                              E*TRADE Group, Inc.\n\n\n                              By: \/s\/ Christos M. Cotsakos\n                                 ---------------------------------------\n                                  Name:  Christos M. Cotsakos\n                                  Title: Chief Executive Officer\n\n\n\n                              Telebanc Financial Corporation\n\n\n                              By: \/s\/ Mitchell H. Caplan\n                                 ---------------------------------------\n                                  Name:  Mitchell H. Caplan\n                                  Title: President and Chief Executive Officer\n\n\n\n\n\n\n                  SIGNATURE PAGE TO STOCK OPTION AGREEMENT\n\n<\/pre>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[9022],"corporate_contracts_industries":[9415],"corporate_contracts_types":[9622,9626],"class_list":["post-43633","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-telebanc-financial-corp","corporate_contracts_industries-financial__banks","corporate_contracts_types-planning","corporate_contracts_types-planning__merger"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/43633","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=43633"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=43633"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=43633"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=43633"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}