1
EXHIBIT 10.24
Execution Copy
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PURCHASE AND ASSUMPTION AGREEMENT
dated as of
July 27, ▇▇▇▇
▇▇▇▇▇▇▇
▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇ NATIONAL TRUST AND SAVINGS ASSOCIATION
and
BOK FINANCIAL CORPORATION
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BRANCH PURCHASE AGREEMENT
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TABLE OF CONTENTS
Page
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ARTICLE 1 Definitions.................................................................................2
1.1 Definitions.................................................................................2
ARTICLE 2 Purchase and Sale..........................................................................10
2.1 Purchase and Sale..........................................................................10
2.2 Closing....................................................................................10
2.3 Transitional Matters.......................................................................15
2.4 Employee Considerations....................................................................18
2.5 Loans......................................................................................22
ARTICLE 3 Price and Adjustments......................................................................24
3.1 Price......................................................................................24
3.2 Adjustments................................................................................24
ARTICLE 4 Additional Covenants.......................................................................30
4.1 Seller's Covenants.........................................................................30
4.2 Buyer's Covenants..........................................................................33
4.3 Consents...................................................................................35
4.4 Environmental Matters......................................................................35
4.5 Valuation of the Assets....................................................................39
4.6 Clearing Items.............................................................................39
4.7 ▇▇▇ Deposits and ▇▇▇▇▇ Accounts............................................................40
4.8 Interest Reporting and Withholding.........................................................40
4.9 Eminent Domain or Taking...................................................................41
4.10 Damage or Destruction......................................................................41
4.11 Real Estate................................................................................43
4.12 Certain Cash Management Relationships......................................................43
4.13 Additional Branches........................................................................44
ARTICLE 5 Representations and Warranties.............................................................45
5.1 Seller's Representations and Warranties....................................................45
5.2 Buyer's Representations and Warranties.....................................................47
ARTICLE 6 Understandings.............................................................................49
6.1 Depositors' Rights.........................................................................49
6.2 Unclaimed Property.........................................................................49
6.3 Head Office Accounts.......................................................................49
6.4 Limitation of Warranties...................................................................50
ARTICLE 7 Conditions to the Closing..................................................................50
7.1 Seller's Conditions........................................................................50
7.2 Buyer's Conditions.........................................................................52
ARTICLE 8 Termination................................................................................53
8.1 Events of Termination......................................................................53
8.2 Liability for Termination..................................................................54
8.3 Procedures Upon Termination................................................................54
ARTICLE 9 Survival, Indemnification..................................................................55
9.1 Survival...................................................................................55
9.2 Seller's Indemnity.........................................................................55
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9.3 Buyer's Indemnity..........................................................................56
9.4 Arbitration of Disputes....................................................................57
9.5 Limit on Indemnities.......................................................................57
9.6 Indemnities................................................................................58
ARTICLE 10 Taxes......................................................................................58
10.1 Obligations of the Buyer...................................................................58
10.2 Access to Information......................................................................58
10.3 Allocation of Consideration................................................................59
ARTICLE 11 Miscellaneous..............................................................................59
11.1 Public Notice..............................................................................59
11.2 Assignment.................................................................................59
11.3 Notices....................................................................................59
11.4 Time.......................................................................................60
11.5 Expenses...................................................................................60
11.6 Misdirected Payments or Communications.....................................................61
11.7 Entire Agreement...........................................................................61
11.8 Amendment..................................................................................61
11.9 Governing Law, Severability................................................................61
11.10 Waiver.....................................................................................61
11.11 Confidentiality............................................................................62
11.12 Third Party Rights.........................................................................62
11.13 Headings...................................................................................62
11.14 Counterparts...............................................................................63
SCHEDULES
A-1 List of Branches
A-2 List of Offices
A-3 List of Off-Site ATMs
1.1(a)(1) Employees - Retail Branches,
Commercial, Business Banking
1.1(a)(2) Employees - Ancillary Operations, Cash
Management
1.1(b) Furniture, Fixtures and Equipment
1.1(c) Other Liabilities
1.1(d) Real Estate - Title Reports
2.2(e) Contracts
2.2(f) Leases
2.5(c) Loans Transferred at Closing
2.5(d) Loans Transferred at Supplemental Loan
Closing
3.1(a) Allocation of Real Estate and
Improvements
3.1(b) Leasehold Improvements
4.4(b) Phase I Environmental Site Assessments
and Asbestos Surveys
4.12 Certain Cash Management Relationships
5.1(e) Litigation
5.1(h) Disclosures Regarding Loans
6.3 Head Office Accounts
10.3 Allocation of Consideration
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EXHIBITS
A Form of Liability Assumption Agreement
B Form of Records Agreement
C Form of Special Warranty Deed
D Form of ▇▇▇▇ of Sale
E Form of Assignment and Assumption
F Form of Officer's Certificate (Seller)
G Form of Officer's Certificate (Buyer)
H Terms and Conditions of Right of Entry Upon Real Estate and
Leased Real Estate
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PURCHASE AND ASSUMPTION AGREEMENT
THIS PURCHASE AND ASSUMPTION AGREEMENT ("Agreement") is made as of July
27, 1998, by and between BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION,
a national banking association established under the laws of the United States
(the "Seller"), and BOK FINANCIAL CORPORATION, an Oklahoma corporation and a
bank holding company under the Bank Holding Company Act of 1956, as amended (the
"Buyer").
WHEREAS, the Seller maintains the branch or branches listed on
Schedule A-1 hereto (sometimes referred to herein collectively as the
"Branches" and individually as a "Branch");
WHEREAS, the Seller maintains the back-office facilities
listed on Schedule A-2 hereto (sometimes referred to herein
collectively as the "Offices" and individually as an "Office");
WHEREAS, the Seller maintains certain unmanned automated
teller machines ("ATMs") at leased locations other than the Branches,
as listed on Schedule A-3 hereto (sometimes referred to herein
collectively as the "Off-Site ATMs" and individually as an "Off-Site
ATM") (the Branches, Offices and Off-Site ATMs are sometimes referred
to herein collectively as the "Facilities");
WHEREAS, the Buyer wishes to purchase certain of the assets
and assume certain of the liabilities of the Facilities and the Seller
is willing to sell and transfer the same upon the terms and subject to
the conditions hereinafter set forth;
WHEREAS, the Seller and the Buyer intend that, either (a) the
Buyer's rights to acquire the Assets and Liabilities will be assigned
to a national banking association, state banking corporation or
federally-chartered thrift institution, which will then be wholly-owned
by the Buyer, or (b) upon mutual agreement of the Seller and the Buyer
(i) the Seller will transfer the Assets and Liabilities to a
newly-formed national banking association, state banking corporation or
federally-chartered thrift institution wholly-owned by an Affiliate of
the Seller ("Newco") and (ii) at the closing hereinafter provided the
Buyer will purchase all of the capital stock of Newco (the "Stock
Purchase"). Where the context requires, references in this Agreement to
"Buyer" shall include Buyer's assignees; and
WHEREAS, the Buyer intends that retail, business banking and
commercial banking services will be offered in the geographic areas
served by the Branches.
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NOW, THEREFORE, in consideration of the premises and the respective
representations, warranties, covenants, agreements and conditions contained
herein, the Seller and the Buyer hereby agree as follows:
ARTICLE 11
Definitions
1.1 Definitions..1 Definitions For purposes of this Agreement:
"Account" means, as of any date, a deposit account with a customer
maintained at one or more of the Branches, whether an asset or a liability of
the Branch at the time of Closing.
"Accrued Expenses" means the accrued and unpaid expenses appearing as a
liability on the Financial Statements pursuant to Section 3.2(c).
"Accrued Interest" on any Deposits at any date means interest which is
accrued on such Deposits to and including such date and not yet posted to such
deposit accounts.
"Additional Branches" shall have the meaning set forth in Section 4.13.
"Additional Information shall have the meaning set forth in Section
4.13.
"Affected Facilities" shall have the meaning set forth in Section
4.4(d).
"Affected Improvements" shall have the meaning set forth in Section
4.10.
"Affiliate" of a person means any person directly or indirectly
controlling or controlled by or under direct or indirect common control with
such person, as control is defined under Section 2 of the Bank Holding Company
Act of 1956, as amended.
"Agreement" means this Purchase and Assumption Agreement, including all
schedules, exhibits and addenda, as modified, amended or extended from time to
time.
"Allocation" shall have the meaning set forth in Section 10.3.
"Asbestos Survey" shall have the meaning set forth in Section 4.4(b).
"Assets" means the Real Estate, the Loans, the Furniture, Fixtures and
Equipment, Improvements, Leasehold Improvements,
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Cash on Hand, safe deposit boxes located at the Branches (exclusive of the
contents thereof), Prepaid Expenses, Overdrafts and all books, records, files
and documentation relating to the foregoing.
"Assumed Contracts" shall have the meaning set forth in Section 2.2(e).
"Assumed Deposits" means all Deposits existing on the Closing Date in
one or more of the Branches, together with all Accrued Interest thereon as of
the Closing Date; provided, however, that Assumed Deposits shall not include any
of the following, which shall be retained by Seller: (i) Deposits not assumed
pursuant to Sections 3.2(g), 3.2(h), or 6.3, (ii) Deposits which secure Visa
credit card accounts, and (iii) other Deposits, if any, which the Buyer has
advised the Seller, at least thirty (30) Business Days prior to the Closing
Date, it cannot legally accept.
"BankAmerica/NationsBank Business Combination" shall have the meaning
set forth in Section 7.1(f).
"BIF" shall have the meaning set forth in Section 3.2(c).
"Business Day" means a day on which the Seller is open for business in
New Mexico and which is not a Saturday or Sunday.
"Buyer's Regulatory Agencies" shall have the meaning set forth in
Section 8.1(e)(i).
"Cash on Hand" means, as of any date, all ▇▇▇▇▇ cash, vault cash,
teller cash, ATM cash and prepaid postage maintained at the Facilities.
"Closing" and "Closing Date" refer to the closing of the sale,
purchase, transfer and assumption provided for herein to be held at the time and
date provided for in Section 2.2(a) hereof.
"Closing Financial Statement" means the balance sheet of the Facilities
prepared by the Seller as of the close of business at the Facilities on the
tenth (10th) Business Day prior to the Closing Date and on which are recorded as
of such date, in accordance with the Seller's normal practices and procedures,
the Assets and the Liabilities (except that such normal practices and procedures
shall be modified as necessary to implement prorations required by, or other
provisions of, this Agreement).
"Collection Advice" shall have the meaning set forth in Section
3.2(i)(i)(A).
"Commitment" shall have the meaning set forth in Section 4.11(b).
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"Confidentiality Agreement" shall have the meaning set forth in Section
11.7.
"Continuation Coverage" shall have the meaning set forth in Section
2.4(g).
"CRA" shall have the meaning set forth in Section 5.2(h).
"Customer Account" shall have the meaning set forth in Section 3.2(i)
(i)(B).
"Damaged Facility" shall have the meaning set forth in Section 4.10(a).
"Deposit-Related Loans" means loans or lines of credit fully secured by
one or more Assumed Deposit accounts that are either savings Accounts or
Accounts with a fixed maturity that are evidenced by a certificate of deposit or
time deposit receipt.
"Deposits" means, as of any date, all deposit liabilities of the Seller
that are Accounts maintained at or allocated to the Branches, including, without
limitation, all uncollected items included in depositors' balances, as of such
date. The term "Deposit" includes the deposit agreement itself and any and all
rights and obligations of the Seller created pursuant to such deposit agreement.
"Direct Debit Accounts" shall have the meaning set forth in Section
4.1(h).
"Direct Deposit Cut-off Date" shall have the meaning set forth in
Section 4.1(g).
"Employee" means any employee employed by Seller or its subsidiaries or
Affiliates on the Closing Date who is described on Schedule 1.1(a)(1) or
1.1(a)(2), including, without limitation, those individuals on medical leave,
family leave, military leave or personal leave under Seller's policies.
"Environmental Assessments" shall have the meaning set forth in Section
4.4(c).
"Environmental Due Diligence Period" shall have the meaning set forth
in Section 4.4(c).
"Environmental Law" means any law, statute, ordinance or regulation
pertaining to health, industrial hygiene or the environment in effect as of the
date of this Agreement, including but not limited to, Title 42 of the United
States Code, Section 6901 et seq. (commonly known as "RCRA") or Section 9601 et
seq. (commonly known as "CERCLA" or "Superfund").
"Excluded Assets" means all investment securities owned by Seller; all
securities purchased by Seller subject to repurchase
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agreements; all other real estate owned by Seller and properties carried as
in-substance foreclosures that are associated with the Branches or Offices (if
any); all loans or participations in loans that are not Loans; all assets,
liabilities and records associated with the investment or brokerage business of
Seller or its Affiliates, whether conducted at the Branches, the Offices or any
other location of Seller; all intangible assets, including goodwill and mortgage
servicing rights, of Seller excluding the goodwill associated with the Assets;
all rights to the name Bank of America and any of Seller's corporate logos,
trademarks, trade names, signs, paper stock, monetary instruments (including,
but not limited to, traveler's checks and cashier's checks), forms and other
supplies containing any such logos, trademarks or trade names; all customer and
merchant credit card accounts; and all trust assets and trust accounts.
"Federal Funds Rate" on any day means the per annum rate of interest
(rounded upward to the nearest 1/100 of 1%) which is the weighted average of the
rates on overnight federal funds transactions arranged on such day or, if such
day is not a banking day, the previous banking day, by federal funds brokers
computed and released by the Federal Reserve Bank of New York (or any successor)
in substantially the same manner as such Federal Reserve Bank currently computes
and releases the weighted average it refers to as the "Federal Funds Effective
Rate" at the date of this Agreement.
"Final Financial Statement" means the balance sheet of the Facilities
prepared by the Seller as of the close of business at the Facilities on the
Closing Date, and delivered by the Seller to the Buyer pursuant to Section
3.2(a)(i). The Final Financial Statement is to be prepared in accordance with
the Seller's normal practices and procedures (except that such normal practices
and procedures shall be modified as necessary to implement prorations required
by, or other provisions of, this Agreement) and in a manner consistent with the
Closing Financial Statement.
"Final Loan List" shall have the meaning set forth in Section 2.5(a).
"Financial Statements" shall mean collectively the Closing Financial
Statement and the Final Financial Statement.
"Furniture, Fixtures and Equipment" means all furniture, fixtures and
equipment owned by the Seller that are located in the Facilities, as listed on
Schedule 1.1(b).
"Hazardous Substance" means any substance, material or waste that is or
becomes designated or regulated as "toxic," "hazardous," "pollutant," or
"contaminant" or a similar designation or regulation under any federal, state or
local law (whether under common law, statute, regulation or otherwise) or
judicial or administrative interpretation of such, including, without
limitation, petroleum or natural gas.
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"Head Office Accounts" has the meaning set forth in Section 6.3.
"Improvements" means all improvements to the Real Estate purchased,
installed or constructed by or on behalf of, and owned by, the Seller and used
in connection with the operation or maintenance of the Branches or Offices,
including, without limitation, buildings, structures, vaults, parking facilities
and drive-up teller facilities.
"Individual Retirement Account" or "▇▇▇" means an account of Seller
created by trust for the exclusive benefit of an individual or his or her
beneficiaries in accordance with the provisions of Section 408 of the IRC.
"Initial Base Amount" shall have the meaning set forth in Section 3.1.
"IRC" means the Internal Revenue Code of 1986, as amended.
"▇▇▇▇▇ Account" means an account created by a trust for the benefit of
employees (some or all of whom are owner-employees) and that complies with the
provisions of Section 401 of the IRC.
"Lease" means any lease or sublease of a lease by which Seller has
rights to occupy and use Leased Real Estate or Leasehold Improvements or any
lease or sublease by which Seller has granted a third party the right to occupy
or use all or a portion of the Real Estate, Improvements, Leased Real Estate or
Leasehold Improvements.
"Leased Real Estate" means all real property on which any of the
Facilities is located, which is occupied and used by the Seller pursuant to a
lease.
"Leasehold Improvements" means all improvements on or constituting a
portion of Leased Real Estate, purchased, installed or constructed by or on
behalf of, and owned by, Seller and used in connection with the operation or
maintenance of the Facilities, including, without limitation, buildings,
structures, vaults, parking facilities and drive-up teller facilities.
"Leasehold Improvements Value" shall have the meaning set forth in
Section 4.10(b).
"Liabilities" means (i) the Assumed Deposits, (ii) the Assumed
Contracts, if any, (iii) the Seller's obligations to provide services from and
after the Closing Date in connection with the Assets and the Assumed Deposits,
including obligations with respect to safe deposit boxes, (iv) the Leases, if
any, (v) the Accrued Expenses, and (vi) such other liabilities of the Seller
with respect to the operations of the Facilities as may be described on Schedule
1.1(c) (the "Other Liabilities");
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excluding, however, any Leases or Assumed Contracts as to which any consents
required to transfer the same to the Buyer at Closing cannot be obtained; and no
other duty, obligation or liability whatsoever (including, without limitation,
any and all penalties, fines, compensatory or punitive damages of any kind
whatsoever) of the Seller, its Affiliates or any other person or with respect to
the Assets or Liabilities.
"Liability Assumption Agreement" shall mean the agreement,
substantially in the form of Exhibit A hereto, pursuant to which Buyer agrees to
assume and discharge all of the Liabilities.
"Lien" means any lien, claim, security interest, charge, encumbrance,
option, special assessment or adverse claim, except for (i) statutory liens
securing payments not yet due, (ii) obligations pursuant to New Mexico's Uniform
Unclaimed Property Act, Sections ▇-▇-▇ ▇▇▇▇▇▇ ▇-▇-▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇ Statutes
Annotated 1978 ("NMSA") relating to Deposits and safe deposit box contents which
become subject to escheat to the State of New Mexico under such law in the year
in which the Closing occurs, and (iii) such imperfections of title as do not
materially and adversely affect the use of the properties or Assets subject
thereto or affected thereby or otherwise materially impair business operations
at such properties.
"Loan Cut-off Date" shall have the meaning set forth in Section 2.5(a).
"Loans" shall mean the Deposit-Related Loans and the Other Loans.
"Magnetic Tapes" shall mean the computer data storage tapes (which may
be in reel-to-reel or cartridge form) prepared by Seller or its agent processor
which contain the information to be used for an automated conversion of the
Assumed Deposits.
"Market Value" shall mean, with respect to any Real Estate, any
Improvements with respect thereto, and the Furniture, Fixtures and Equipment,
the appraised market value thereof on an "as is" basis, reflecting the highest
and best use thereof in the condition observed by the appraiser upon inspection
and as such property physically and legally exists without hypothetical
conditions, assumptions or qualifications. Market Value is the most probable
price which a property should bring in a competitive and open market under all
conditions requisite to a fair sale, the buyer and the seller each acting
prudently and knowledgeably, and assuming the price is not affected by undue
stimulus. Implicit in this definition is the consummation of a sale as of a
specified date and the passing of title from the seller to the buyer under
conditions whereby: (i) the buyer and the seller are typically motivated; (ii)
both parties are well informed or well advised, and acting in what they consider
their own best interests; (iii) a reasonable time is allowed for exposure in the
open market; (iv) payment is made in cash in U.S. dollars or in terms of
financial arrangements comparable
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thereto; and (v) the price represents the normal consideration for the property
sold, unaffected by special or creative financing or sales concessions granted
by anyone associated with the sale.
"Non-Assumed Liabilities" means any liabilities or obligations of
Seller (whether accrued, absolute, contingent, liquidated, unliquidated, known
or unknown, due or to become due) other than those specifically described in the
term "Liabilities." Non-Assumed Liabilities include, but are not limited to, the
following:
(a) cashier's checks, money orders, interest checks, official
checks, drafts and expense checks issued by Seller prior to or at
Closing;
(b) any liabilities or obligations (other than the
Liabilities) arising from or connected with the Facilities or Assumed
Deposits proximately caused by any action by Seller prior to the
Closing or any failure to act by Seller prior to the Closing under
circumstances under which Seller had a legal duty to act prior to the
Closing; and
(c) any liabilities of Affiliates of Seller, including BA
Investment Services, Inc., which provides investment and brokerage
services to customers of Seller.
"OCC" means the Office of the Comptroller of the Currency.
"Other Loans" means the loans (other than Deposit-Related Loans) which
shall be described as such on those lists of Loans to be provided to Buyer
pursuant to Section 2.5(a).
"Overdrafts" means any overdrafts in Transaction Accounts (other than
overdrafts extended pursuant to a formal line of credit or similar arrangement)
maintained at the Branches.
"Permitted Exceptions" shall have the meaning set forth in Section
4.11(b).
"Phase I" shall have the meaning set forth in Section 4.4(b).
"Prepaid Expenses" means the prepaid expenses appearing as an asset on
the Financial Statements pursuant to Section 3.2(c).
"Purchase Premium" means, as of the Closing Date, [redacted].
"Real Estate" means all real property owned by the Seller on which any
of the Facilities is located and which is identified in the preliminary title
reports included in Schedule 1.1(d).
"Records" means the books, records, files and documentation relating to
the Assets and the Liabilities.
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"Records Agreement" means the agreement, substantially in the form of
Exhibit B hereto, pursuant to which Seller shall provide Buyer with access to
certain records with respect to the Facilities.
"Reported Amounts" shall have the meaning set forth in Section 4.8(a).
"Retained Records" means the records to remain in the possession of
Seller pursuant to the terms of the Records Agreement.
"RI" shall have the meaning set forth in Section 3.2(i)(i).
"Seller's Knowledge" or other similar phrases shall mean the actual
knowledge, without having conducted any independent inquiry or investigation, of
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, Executive Vice President and Regional Manager, ▇▇▇▇▇▇ ▇▇▇▇,
District Manager and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Small Business Manager.
"Settlement Date" means the sixtieth (60th) calendar day following the
Closing Date.
"Shares" shall have the meaning set forth in Section 2.1(b).
"Subject Assets" shall have the meaning set forth in Section 4.4(b).
"Supplemental Loans" shall have the meaning set forth in Section
2.5(d).
"Supplemental Loan Closing" shall have the meaning set forth in Section
2.5(d).
"Survey" shall have the meaning set forth in Section 4.11(a).
"Surveyor" shall have the meaning set forth in Section 4.11(a).
"Taking Facility" shall have the meaning set forth in Section 4.9.
"Title Company" means Albuquerque Title Company, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇.▇.,
▇▇▇▇▇▇▇▇ ▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇.
"Title Documents" shall have the meaning set forth in Section 4.11(b).
"Title Policy" shall have the meaning set forth in Section 4.11(b).
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"Transaction Account" means any Account in respect of which deposits
therein are withdrawable in practice upon demand or upon which third party
drafts may be drawn by the depositor, including checking accounts, NOW accounts
and money market deposit accounts.
"Withholding Accounts" shall have the meaning set forth in Section
4.8(b).
The foregoing definitions apply equally, where applicable and with
appropriate modifications, to both singular and plural forms of the term
defined. Other terms are defined in the text of this Agreement and have the
meanings assigned herein.
ARTICLE 22
Purchase and Sale
2.1 Purchase and Sale.
(a) Unless the parties hereto shall have elected to pursue the Stock
Purchase, upon the terms and subject to the conditions of this Agreement, the
Seller agrees to sell and transfer and the Buyer agrees to purchase and assume
the Assets and the Liabilities at the Closing as provided in Section 2.2.
(b) In the event the Seller and the Buyer elect to pursue the Stock
Purchase, upon the terms and subject to the conditions of this Agreement (i)
immediately prior to the Closing the Seller agrees to transfer the Assets and
Liabilities to Newco and (ii) at the Closing the Seller agrees to sell and the
Buyer agrees to purchase from the Seller all of the outstanding capital stock of
Newco (the "Shares") as provided in Section 2.2(g).
2.2 Closing
(a) Closing Date and Place. The closing of the transactions provided
for herein will be held at the offices of ▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇, A Professional
Corporation, Two Park Square, ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇.▇., ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇; provided that transfer of the Real Estate shall be effected
through a real estate escrow to be opened with the Title Company. The closing
shall be held on a Friday that is mutually agreeable to the Buyer and the Seller
as soon as practicable following the receipt of all government and other
approvals and consents necessary for the consummation of the transactions
contemplated hereby (including the expiration of any statutory waiting periods)
and the satisfaction (or waiver) of all other conditions to closing provided for
herein. The Closing shall be effective for purposes of this Article 2 as of
12:01 a.m. (Mountain Time) on the Saturday following the Closing Date; however,
the effective time of Closing shall have no effect on the calculations to be
made under the Financial Statements
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(which are to be as of the close of business at the Facilities on the Closing
Date). Notwithstanding the foregoing, the Seller may, for any proper business
reason, adjourn the date and time of the Closing, upon written notice to the
Buyer; provided, however, that the Seller shall use all reasonable efforts to
reschedule the Closing to take place at a time agreeable to the Buyer, which
agreement shall not be unreasonably withheld; provided further, however, that
the parties shall agree in any event upon a date for the Closing which shall be
no later than the later of March 31, 1999 and a date six months after the date
the BankAmerica/NationsBank Business Combination is consummated, or such other
date as the Seller and the Buyer shall agree upon in writing.
(b) Conveyances; Payment.
(i) Subject to Section 2.2(g), at the Closing, the Seller
shall execute and/or deliver to the Buyer the following, subject to
Sections 2.2(e), 2.2(f), 3.2(b), 4.3 and the final paragraph of Section
7.2:
(A) One or more special warranty deeds for the Real
Estate, if any, in the form attached hereto as Exhibit C,
subject only to the ad valorem taxes for the year of the
Closing and Permitted Exceptions;
(B) One or more bills of sale in the form attached
hereto as Exhibit D for the Improvements, the Leasehold
Improvements, if any, and the Furniture, Fixtures and
Equipment;
(C) One or more assignments in the form attached
hereto as Exhibit E for the Leases, if any, and the Assumed
Contracts, if any;
(D) The payment to the Buyer required by Section 3.1
in immediately available funds (such payment to be made no
later than 12:00 p.m. (Mountain Time) on the Closing Date);
(E) The Records Agreement;
(F) The officer's certificate required by Section
7.2(b) in the form of Exhibit F hereto;
(G) The Closing Financial Statement;
(H) The original notes or certified copies of the
original notes for all Loans, endorsed without recourse,
assignments of real property security instruments in
recordable form, and all related Loan files;
(I) All collateral security of any nature
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whatsoever held by Seller as collateral for any of the Assets;
(J) All documents, contracts, certificates,
instruments, keys and records necessary or appropriate to
transfer the safe deposit and safekeeping businesses, if any,
of the Branches, to be delivered at the close of business on
the Closing Date;
(K) Possession of the Assets and access to and keys
for each of the Facilities, to be delivered at the close of
business on the Closing Date;
(L) A non-foreign affidavit as required by Section
1445 of the IRC;
(M) Such other documents as may be reasonably
required by the Title Company in connection with the issuance
of the Title Policy, including an affidavit as to taxes, liens
and possession;
(N) The Seller shall use its reasonable efforts to
have available for pick-up by the Buyer as soon as practicable
on the day following the Closing Date (I) hard copy (printed)
lists of Assumed Deposits maintained at each Branch, which
lists shall identify each Assumed Deposit by type of account,
with appropriate information regarding the depositor and the
terms of the account and (II) Magnetic Tapes. The Buyer shall
have the responsibility of making and paying for the
appropriate courier arrangements to pick up from the Seller
the items referred to in (I) and (II) above and to deliver the
items referred to in (I) to the appropriate Branches and the
items referred to in (II) to the Buyer's system vendor; and
(O) Copies of written consents to the assignment of
any Assumed Contracts or Leases requiring such consent.
(c) Deliveries by Buyer at the Closing. Subject to Section 2.2(g), at
the Closing, Buyer shall execute and/or deliver to Seller, with such instruments
to be in form and substance satisfactory to Seller and Buyer, the following:
(i) The Liability Assumption Agreement;
(ii) The Records Agreement;
(iii) The officer's certificate required by Section 7.1(b) in
the form of Exhibit G hereto;
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(iv) A certificate duly executed by an authorized officer of
Buyer, dated as of the Closing Date, acknowledging receipt of
possession of the Assets; and
(v) Payment to the Seller of the amount of the interest which
would accrue at the Federal Funds Rate in effect on the Closing Date on
the cash payment by the Seller pursuant to Section 2.2(b)(i)(D) (such
payment to be made no later than 12:00 p.m. (Mountain Time) on the
Closing Date).
(d) Proration. The Seller and the Buyer shall each pay one-half of any
recording fees and escrow fees relating to the sale of the Assets and assumption
of the Liabilities, including but not limited to, the assignment of the Leases.
On the Closing Date, (i) all real and personal property taxes and current
installments of special assessments levied or assessed with respect to the Real
Estate, the Improvements, the Leasehold Improvements and the Furniture, Fixtures
and Equipment shall be prorated between the Seller and the Buyer on a daily
basis as of the Closing Date based upon the fiscal year of the appropriate
taxing authority, and (ii) utilities and any other normal maintenance and
operating expenses, if any, relating to the Real Estate, the Leases, the
Improvements, the Leasehold Improvements and the Furniture, Fixtures and
Equipment shall be prorated between the Seller and the Buyer as of the Closing
Date on a daily basis. The Buyer will be responsible for all other special
assessments with respect to any Real Estate or Leased Real Estate, including
so-called standby utility expansion, development, tap-in or pro rata or hook-up
charges, water meter or impact fees, including, but not limited to, assessments
for paving, curb, gutter, sidewalks, and sewer or storm sewers. The Seller will
be entitled to receive a credit at Closing equal to the credit that the Buyer
will receive from any governmental authority, if any, against utility expansion
charges or impact fees as a result of standby or other applicable fees that have
been paid by the Seller.
(e) Contracts. Subject to Section 2.2(g), at the Closing, the Seller
shall assign to the Buyer all of the Seller's right, title and interest in those
equipment leases and service and maintenance contracts, if any, relating to the
operations of one or more of the Facilities which are set forth in Schedule
2.2(e) and which the Buyer indicates in writing to the Seller not later than
thirty (30) Business Days prior to Closing the Buyer wishes to assume
(collectively, the "Assumed Contracts"). The Seller shall not be required to
provide Buyer with any information regarding, or to set forth in Schedule
2.2(e), equipment leases or service and maintenance contracts which it believes
are not legally assignable, and the Seller shall have no liability to the Buyer
as the result of its inability to accomplish assignments thereof. After the date
of this Agreement, the Seller shall not enter into, except with the prior
written
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consent of the Buyer, any service, maintenance or other contracts, or any
equipment lease, relating to the operations of the Facilities for which the
Buyer shall have any responsibility after the Closing.
(f) Leases. Subject to Section 2.2(g), at the Closing, the Seller shall
assign to the Buyer all of the Seller's right, title and interest in the Leases,
if any, set forth in Schedule 2.2(f); provided, however, that if the Seller
notifies the Buyer not later than thirty (30) Business Days prior to the Closing
Date that one or more such Leases are legally nonassignable without the consent
of one or more third parties, and that such consents have not been obtained,
then, if the Lease permits the Seller to sublease the premises and the related
Leasehold Improvements to the Buyer, the Seller shall sublease such premises and
Leasehold Improvements to Buyer for the maximum term permitted under the Lease,
on substantially the same terms and conditions as the terms and conditions of
the Lease, in which case the consideration payable under Article 3 shall be
adjusted to reflect the Leasehold Improvements which will not be transferred to
the Buyer and the parties shall continue to be obligated to carry out the
provisions of this Agreement as to the remaining Assets of such Facility and as
to the remaining Facilities. If the Lease does not permit the Seller to sublease
the premises and the related Leasehold Improvements to the Buyer, then (i) the
Seller shall not be required to assign or sublease such Lease or Leases at
Closing, (ii) the Seller shall have no liability to the Buyer as the result of
its inability to accomplish such assignment or sublease and (iii) the Seller at
its sole discretion may elect to exercise its right under the final paragraph of
Section 7.2 to exclude the affected Leased Real Estate from the Closing, and the
parties shall continue to be obligated to carry out the provisions of this
Agreement as to the remaining Assets of such Facility and as to the remaining
Facilities, in which case the consideration payable under Article 3 shall be
adjusted to reflect the Leased Real Estate which will not be transferred to the
Buyer.
(g) In the event the parties elect to pursue the Stock Purchase:
(i) the Seller shall transfer, assign and deliver to Newco and shall
cause Newco to accept and assume from the Seller, not later than the Closing
Date, all right, title and interest of the Seller in and to the Assets and
Liabilities;
(ii) following the transfer of the Assets and Liabilities as set forth
in Section 2.2(g)(i), at the Closing the Seller shall sell and the Buyer shall
purchase the Shares;
(iii) each of the items required to be delivered by the Seller under
Sections 2.2(b)(i)(A), (B), (C), (H) and (I) shall be delivered to Newco;
(iv) each of the items required to be delivered by the Buyer under
Section 2.2(c)(i) shall be delivered by Newco;
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(v) each of the contracts, leases and other agreements to be assigned
by the Seller under Sections 2.2(e) and 2.2(f) shall be assigned to Newco; and
(vi) the Seller shall execute and deliver to the Buyer duly endorsed
certificates, evidencing the Shares, or certificates evidencing the Shares
accompanied by valid stock powers duly endorsed in blank by the Seller.
2.3 Transitional Matters.
(a) Conduct of Business Prior to the Closing. From the date hereof
until the Closing, except as expressly permitted by this Agreement or otherwise
consented to or approved by the Buyer in writing (such consent or approval not
to be unreasonably withheld):
(i) The Seller shall not incur any material liabilities or
material obligations (whether directly or by way of guaranty,
endorsement, surety contract or otherwise) domiciled at any Facility or
for which any Facility may be bound, including, without limitation, any
obligation for borrowed money or evidenced by any note, bond, debenture
or similar instrument, except for deposit liabilities incurred in the
ordinary course of business pursuant to the Seller's customary rate
schedules, and except for other liabilities and obligations incurred in
the ordinary course of business;
(ii) The Seller shall not sell, transfer, mortgage, encumber
or otherwise dispose of any of the Assets except for the disposition of
Assets (other than the Real Estate, Improvements or Leasehold
Improvements) in the ordinary course of business;
(iii) Except as provided in Article 6, the Seller will not
cause the transfer from one or more of the Branches to the Seller's
other operations (except to another Branch) of any deposits of the type
included in the Liabilities; provided, however, that the Seller may
transfer deposits to the Seller's other branches or offices upon
request of the depositors and may transfer to its other branches or
offices other deposits which are not to be transferred to Buyer
pursuant to this Agreement;
(iv) The Seller shall not make any capital commitments with
respect to the Real Estate, the Improvements and the Leasehold
Improvements, except (A) aggregate capital commitments made in the
ordinary course of business not exceeding $25,000 for each
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Facility, and (B) emergency repairs required to restore any Facility to
a safe operating condition;
(v) The Seller shall not grant any increase in the rate of
compensation or in the benefits payable or to become payable to any
current officer or employee of the Facilities, or to any current agent
or consultant thereof, over the levels in effect as of the date hereof,
other than any regularly scheduled increases, including bonuses,
contemplated under contracts, policies or programs existing on the date
hereof or under any benefit program generally applicable to the
Seller's employees; provided that the Seller shall retain the right to
hire additional Branch and Office employees at comparable rates of
compensation as necessary for the operation of the Facilities;
(vi) The Seller will maintain the Real Estate, Leased Real
Estate, Improvements, Leasehold Improvements and Furniture, Fixtures
and Equipment substantially in accordance with its normal practices,
and keep such property in its present condition, ordinary wear and tear
excepted;
(vii) The Seller shall operate the Facilities and the
businesses thereof in accordance with Seller's normal practices and
will use reasonable efforts to preserve for the benefit of the Buyer
after the Closing the Facilities' business, goodwill and relationships
(including deposit relationships at the Facilities) with customers and
suppliers; without limiting the generality of the foregoing, Seller
will not, and, following the closing of the BankAmerica/NationsBank
Business Combination, Seller will not permit the New Mexico operations
of NationsBank, N.A., to:
(A) Solicit deposits, deposit-related products or loans
from persons who are depositors at the Facilities,
except in connection with general solicitations or
general advertising not targeted specifically at the
depositors at the Facilities and except non-targeted
solicitations or advertising in the ordinary course
of providing service to individual depositors at the
Facilities who are also at the time of such
solicitation or advertisement depositors of other
branches of Seller or, following the closing of the
BankAmerica/NationsBank Business Combination, of the
New Mexico operations of NationsBank, N.A.;
(B) Solicit persons who are depositors at the Facilities
to change deposit
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accounts at the Facilities to non-deposit-related
investments, except in connection with general
solicitations of individual depositors at the
Facilities in the ordinary course of providing
service to such depositors undertaken without
management direction given from and after the date of
this Agreement;
(C) Introduce at any of the Facilities any new deposit
product or change any feature of any deposit product
except a new product or feature introduced throughout
Seller's offices region-wide in the ordinary course
of business; and
(viii) The Seller shall provide the Buyer reasonable access
during normal business hours to, and the opportunity to review and
inspect, the Real Estate, Improvements, Leased Real Estate, Leasehold
Improvements, Furniture, Fixtures and Equipment, and the Records; shall
furnish to the Buyer such reports and compilations pertaining thereto
as the Buyer shall reasonably request from time to time (provided that
the Seller shall have no obligation to assemble any new reports or
compilations not already prepared in the ordinary course of the
Seller's business); and shall furnish to the Buyer all such other
information pertaining to the Assets and the Liabilities and the
business of the Facilities as the Buyer may reasonably request. In no
event, however, shall the Seller be obligated to incur any fees or
expenses (including accounting or other professional fees) other than
the indirect costs associated with the employment of the Seller's
existing employees in connection with the furnishing of any such
information or reports. In addition, the Seller shall provide the Buyer
reasonable access to the Facilities during the thirty (30) calendar day
period immediately preceding the Closing Date for the purpose of
installing teller terminals and other equipment, provided that (A)
Seller shall not be required to provide such access to any Facility
until after all consents, approvals and authorizations referred to in
Sections 7.1(c) and 7.2(c) hereof have been obtained with respect to
all Facilities and (B) Buyer shall give Seller at least twenty-four
(24) hours advance notice that it wishes to have such access. The Buyer
agrees to cause the installation of such teller terminals and other
equipment to be effected in a manner intended to minimize disruption to
the operations of the Facilities.
(b) Buyer's Access to Facility Premises. The Buyer will indemnify,
defend, and hold Seller harmless for, from and against any and all claims,
damages, costs, liabilities and
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losses (including mechanics' liens) arising out of any entry by Buyer or its
agents, designees or representatives on the Real Estate or Leased Real Estate
for purposes of the review, inspection and installation provided for in Section
2.3(a)(viii) or for any other purpose (other than for the purposes set forth in
Section 4.4(c), which shall be governed by the provisions of that Section).
Without limiting the scope of the foregoing, Buyer also will restore the Real
Estate, Improvements, Leased Real Estate, Leasehold Improvements, Furniture,
Fixtures and Equipment, and Records at its sole cost and expense if one or more
of the transactions contemplated by this Agreement do not close. Until
restoration is complete, Buyer will take all steps necessary to ensure that any
conditions at the Facilities created by any testing, review, inspection,
installation or other actions performed by or for Buyer will not interfere with
the normal operation of the Facilities or create any dangerous, unhealthy,
unsightly or noisy conditions at the Facilities. Buyer shall comply with any
requirements or restrictions contained in the Leases regarding any actions it
takes at the Leased Real Estate, including, without limitation, any requirements
of notice to the landlord (all of which notices at any time prior to Closing
will be made through Seller or Seller's agent). The provisions of this Section
2.3(b) shall survive the Closing or any earlier termination of this Agreement.
(c) Data Processing Conversion. The conversion of the data processing
with respect to the Facilities and the Assets and the Liabilities to be
transferred hereunder will be completed no later than the next Business Day
following the Closing Date. In connection with the data processing conversion,
the Seller and the Buyer shall each pay its own costs and expenses associated
with the data processing conversion and shall bear equally the duties and
responsibilities relating to such conversion. The Seller will use its reasonable
efforts to have available to the Buyer at a mutually agreed date and time after
the Closing Date, a list (which may be in the form of machine-readable data
cartridges) of the Assumed Deposits as of the most recent practicable date,
which list identifies each Assumed Deposit by type, with appropriate information
regarding the depositor and the terms of the Assumed Deposit. The Buyer will
have the responsibility of arranging and paying for courier pick-up of such
information from the Seller's data processor in Milwaukee, Wisconsin and
delivery to the Buyer's data processor. In no event shall the Seller be required
to provide any computer programming, source code or changes in existing file
layouts. The Seller will not migrate (transfer) existing PINs used for ATM cards
to the Buyer.
2.4 Employee Considerations
(a) Buyer shall offer employment as of the day after the Closing Date
to all Employees described on Schedule 1.1(a)(1). Buyer shall have the
opportunity to interview Employees
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described on Schedule 1.1(a)(2) and may offer employment as of the day after the
Closing Date to any such Employee. All Employees shall be offered employment at
base wages and salaries no less favorable than the wages and salaries currently
being paid by Seller to such Employees. To the extent consistent with Buyer's
existing structure for comparable positions and comparable officer titles and
its current policies regarding officer titles, Employees shall be offered
positions with responsibilities and officer titles comparable to those they
currently have with Seller. Unless agreed upon by an Employee, the position
offered by the Buyer will not create a commute that is greater than 35 miles one
way, and if the Employee's current commute is in excess of 35 miles one way, the
position will not increase the Employee's commute.
(b) All Employees who accept employment with Buyer as of the day after
the Closing Date shall be eligible to participate in the employee benefit plans
and other fringe benefits of Buyer on the same basis as such plans and benefits
are offered to employees of Buyer with comparable positions with Buyer, except
as provided in the penultimate sentence of Section 2.4(e). Buyer shall credit
such Employees for their length of service with Seller or its Affiliates for all
purposes under each employee benefit plan and fringe benefit to be provided by
Buyer to such Employees, to the same extent such service was recognized under a
similar plan of Seller, based on information provided by Seller. However, such
service need not be counted for purposes of calculating accrued benefits under a
pension benefit plan, except that in determining the rate of prospective benefit
accrual, service shall be counted where such rate increases with service. For
purposes of this Section 2.4, "employee benefit plans and other fringe benefits"
includes, without limitation, pension and profit sharing plans, retirement and
post retirement welfare benefits, health insurance benefits (medical, dental and
vision), disability, life and accident insurance, sickness benefits, vacation,
employee loans and banking privileges.
(c) If Buyer offers a salary continuation or similar program for
employees unable to work for medical reasons, the Employees who accept
employment with Buyer shall be credited under any program of Buyer with at least
the number of sickness benefit days accrued under Seller's program at the
Closing Date.
(d) Seller agrees to remain responsible for the payment of all benefits
accrued during the period of employment by the Seller under the terms of the
Seller's retirement plans with respect to any Employee. Buyer shall not at any
time assume any liability for the benefits of any active or any terminated,
vested or retired participants in the Seller's retirement plans.
(e) Seller shall be responsible for payments for accrued vacation not
taken by an Employee on or prior to the Closing
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Date and for timely payment as required by law of all wages, salaries, bonuses,
if any, and other compensation with respect to service completed on or prior to
the Closing Date. Seller shall offer Employees who accept employment with Buyer
the option to receive cash or to transfer to Buyer their accrued vacation days
or fractions thereof earned but unused while employed by Seller. In the event
any Employee elects to receive cash upon employment by Buyer, Seller shall make
a cash payment to such Employee in accordance with applicable law. In the event
any such Employee elects to have his or her accrued vacation transferred upon
employment by Buyer, Buyer shall give such Employee credit after the Closing
Date for the same number of vacation days or fractions thereof he or she has
accrued with Seller as of the Closing Date. For purposes of this Section 2.4(e),
personal choice days or fractions thereof will be treated as vacation days. In
the event Employees elect to have their accrued vacation carried over to Buyer,
Seller shall pay to Buyer, not later than the date of the Final Financial
Statement, an amount equal to the net cash value of each such Employee's accrued
vacation before payroll deductions. In the calendar year in which the Closing
Date occurs, Employees shall be eligible to earn at least the prorated annual
vacation amount Employees were eligible to earn under Seller's vacation policy.
In subsequent calendar years, Employees will be eligible to earn vacation
according to the schedule specified in Buyer's policy.
(f) Seller shall retain the responsibility for payment of all medical,
dental, vision, health and disability claims incurred by any Employee on or
prior to the Closing Date, and Buyer shall not assume any liability with respect
to such claims. After the Closing Date, all medical, dental, vision, health and
disability claims incurred by Employees in Buyer's employ shall be determined
under Buyer's benefit plans. Buyer agrees that Employees and their eligible
dependents will receive credit for their periods of coverage under Seller's
health or disability plans towards satisfying any preexisting condition clause
in any of Buyer's health or disability plans, provided such Employee or eligible
dependent is enrolled in Seller's plans on the Closing Date. Buyer also agrees
that Employees and their eligible dependents shall receive credit under Buyer's
health care plans for any deductibles paid by such Employee and enrolled
dependents for the current plan year under a health care plan maintained by
Seller.
(g) Seller shall be responsible for providing any Employee whose
"qualifying event," within the meaning of Section 4980B(f) of the IRC, occurs on
or prior to the Closing Date (and such Employee's "qualified beneficiaries"
within the meaning of Section 4980B(f) of the IRC) with the continuation of
group health coverage required by Section 4980B(f) of the IRC ("Continuation
Coverage") under the terms of the health plan maintained by Seller. Buyer shall
be responsible for Continuation Coverage to any Employee in Buyer's employ (and
each Employee's qualified beneficiaries) whose qualifying event occurs after the
Closing Date to the extent required by law.
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(h) Seller agrees that it shall retain, consistent with its normal
employment practices, all liability and obligation, if any (including, without
limitation, the liability and obligation for all wages, salary, vacation pay and
unemployment, medical, dental, vision, health and disability benefits) for those
former employees of the Facilities who retired or terminated employment on or
prior to the Closing Date or who otherwise do not become employees of Buyer.
(i) Effective as of the day after the Closing Date, Buyer shall assume
liability for severance pay and similar obligations payable to any Employee who
accepts employment with Buyer and who is terminated by Buyer on or after the
Closing Date. Such payment shall be made pursuant to Buyer's normal severance
policy and Buyer shall compute severance pay by giving Employees full credit for
all years of service that would have been recognized under Seller's severance
policy. In addition, for an Employee whose job with Buyer is eliminated by a
reduction in force or elimination of position within twelve (12) months of the
Closing Date, Buyer agrees to pay to such Employee the difference, if any,
between the amount of severance pay received by the Employee under Buyer's
severance policy and the amount such Employee would have received upon his or
her separation from the Seller under Seller's severance policy in effect at that
time.
(j) Effective immediately after the Closing Date, the Buyer shall
assume all liability and obligation for, and Seller shall have no further
liability or obligation for, short-term disability benefits, sick pay or salary
continuation to the extent attributable to periods after the Closing Date (and
any medical, dental, vision and health benefits for claims incurred after the
Closing Date) for those Employees who accept employment with the Buyer and who
as of the day after the Closing Date are absent from work due to sickness or
short-term disability.
(k) The Buyer shall make the offers of employment as soon as possible
after all the consents, approvals and authorizations referred to in Sections
7.1(c) and 7.2(c) hereof have been obtained (and in no event more than ten (10)
Business Days after the last of such consents, approvals and authorizations has
been obtained). Buyer will promptly notify Seller of any offer it plans to make
prior to extending such offer, and of acceptance of any such offer by any
Employee. Buyer shall be responsible for advising Employees of the details of
any offers and terms of employment, and answering any questions relating
thereto, but Seller shall be allowed to review and approve (which approval shall
not be unreasonably withheld), prior to its distribution, (i) any communication
with Employees on or prior to the Closing Date, and (ii) any communication with
such Employees after the Closing Date which describes or refers to Seller's
employee benefit plans and
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policies. Buyer shall not at any time have access to Employee personnel files of
Seller.
(l) (i) For a period of twelve (12) months following the Closing
Date, neither the Seller nor any Affiliate shall solicit the employment
(including the solicitation of any transfer of employment) of any
Employee who is employed by Buyer; provided, however, that nothing
herein shall prevent the Seller or its Affiliates from advertising
generally any employment opportunities, or from hiring any Employees
employed by Buyer who seek employment without inducement from the
Seller.
(ii) For a period of twelve (12) months following the Closing
Date, neither the Buyer nor any Affiliate shall solicit the employment
(including the solicitation of any transfer of employment) of any
employees of the Seller; provided, however, that nothing herein shall
prevent the Buyer or its Affiliates from advertising generally any
employment opportunities, or from hiring any employees of the Seller
who seek employment without inducement from the Buyer.
(iii) The parties hereby acknowledge and agree that the
failure of either party to fulfill its covenants and agreements set
forth in this Section 2.4(l) will cause irreparable harm to such other
party for which damages, even if available, will not be an adequate
remedy. Accordingly, each party hereby consents to the issuance of
injunctive relief by any court of competent jurisdiction to compel
performance of such party's obligations under this Section 2.4(l) and
to the granting by any such court of the remedy of specific
performance by such party of its obligations hereunder.
2.5 Loans
(a) Loan Lists. As soon as practicable following the date hereof until
thirty (30) calendar days prior to the Closing Date, Seller shall provide to
Buyer within ten (10) Business Days following each month-end a cumulative list
of the Deposit-Related Loans and the Other Loans proposed to be transferred to
Buyer (or Newco in the case of the Stock Purchase) pursuant to Section 2.1
(subject to Buyer's rights as described in Section 2.5(b) to exclude certain of
such loans), prepared as of such month-end (the final Loan list prepared shall
be referred to herein as the "Final Loan List" and the date as of which such
Final Loan List is prepared shall be referred to herein as the "Loan Cut-off
Date").
(b) Buyer's Right to Exclude Loans Prior to Closing Date.
Notwithstanding anything in this Agreement to the contrary, until fifteen (15)
calendar days prior to the Closing Date, the Buyer shall have the right to
exclude from the transaction any Loan on the Final Loan List, which excluded
loan shall not be
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transferred to the Buyer pursuant to Section 2.1. The Buyer's right to exclude
such loans shall be exercisable by the Buyer giving written notice to the Seller
at any time until and including the fifteenth (15th) calendar day prior to the
Closing Date.
(c) Deposit-Related Loans Originated After Loan Cut-off Date. Any
Deposit-Related Loan originated by Seller on or after the Loan Cut-off Date and
prior to the Closing Date in the ordinary course of Seller's business at the
Branches and the Offices shall be transferred to Buyer (or Newco in the case of
the Stock Purchase) at the Closing. As soon as practicable following the
Closing, but in any event no later than ten (10) Business Days thereafter, the
Seller shall provide to the Buyer a schedule of the Loans transferred to the
Buyer at the Closing, which schedule shall become Schedule 2.5(c) hereto upon
such delivery to Buyer.
(d) Other Loans Originated After Loan Cut-off Date.
(i) Any Other Loan originated by Seller on or after the Loan Cut-off
Date and prior to the Closing Date in the ordinary course of Seller's
business at the Branches and the Offices (collectively, the
"Supplemental Loans") shall, subject to Buyer's rights as described in
this Section 2.5(d) to exclude certain of such loans, be transferred to
Buyer at a closing to be held as soon as practicable following the
Closing Date, but in any event no later than sixty (60) calendar days
following the Closing Date (the "Supplemental Loan Closing"). The
Supplemental Loan Closing shall occur on the same date as the payment
required by Section 3.2(a)(i).
(ii) As soon as practicable following the Closing, but in any event no
later than fifteen (15) Business Days thereafter, the Seller shall
provide to the Buyer a schedule of the Supplemental Loans to be
transferred to the Buyer pursuant to this Section 2.5(d), subject to
the Buyer's rights as described herein to exclude any of the
Supplemental Loans. Notwithstanding anything in this Agreement to the
contrary, from and after the date on which Buyer receives such
schedule, until ten (10) calendar days prior to the Supplemental Loan
Closing, (A) the Seller shall provide the Buyer reasonable access
during normal business hours to, and the opportunity to review and
inspect, the Records relating to the Supplemental Loans; and (B) the
Buyer shall have the right to exclude from the transaction any such
Supplemental Loan. If the Buyer exercises its right to exclude such
Supplemental Loan, such excluded loan shall not be transferred to the
Buyer at the Supplemental Loan Closing. The Buyer's right to exclude
any Supplemental Loans shall be exercisable by the Buyer giving written
notice to the Seller at any time until and including the tenth (10th)
calendar day prior to the Supplemental Loan Closing.
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Following the expiration of such ten (10) calendar day period, the
Seller shall provide to the Buyer a schedule of the Supplemental Loans
to be transferred to Buyer at the Supplemental Loan Closing, which
schedule shall become Schedule 2.5(d) hereto upon such delivery to
Buyer. The Final Financial Statement shall be adjusted to reflect the
Supplemental Loans transferred to Buyer pursuant to this Section
2.5(d).
(iii) At the Supplemental Loan Closing, the Seller shall execute and/or
deliver to the Buyer (A) the original notes or certified copies of the
original notes for all Supplemental Loans transferred to Buyer pursuant
to this Section 2.5(d), endorsed without recourse, assignments of real
property security instruments in recordable form and all related
Supplemental Loan files; and (B) an officer's certificate of Seller
certifying to the accuracy, in all material respects, of the
representations and warranties in Section 5.1(h) with respect to the
Supplemental Loans transferred to Buyer pursuant to this Section
2.5(d).
ARTICLE 33
Price and Adjustments
3.1 Price. The Seller agrees that in the event the Initial Base Amount
(as hereinafter defined) is less than the sum of (i) the amount of the Assumed
Deposits and (ii) the amount of the Accrued Expenses, the Seller shall transfer
to the Buyer cash in the amount equal to the deficit. The Buyer agrees that in
the event the Initial Base Amount is greater than the sum of (i) the amount of
the Assumed Deposits and (ii) the amount of the Accrued Expenses, the Buyer
shall transfer to the Seller cash in an amount equal to such excess.
Calculations and payments pursuant to this Section 3.1 shall be as of the date
and time of the Closing Financial Statement. The "Initial Base Amount" shall be
equal to the sum of (i) the amount of Cash on Hand, (ii) the Market Value of
$5,085,000.00 for the Real Estate and the Improvements (which amount is
allocated among the Facilities as listed on Schedule 3.1(a)), (iii) the amount
of $349,529.66 for the Leasehold Improvements (which amount, if any, is
allocated among the Facilities as listed on Schedule 3.1(b)), (iv) the Market
Value of $790,960.00 for the Furniture, Fixtures and Equipment (which amount is
allocated as listed on Schedule 1.1(b)), (v) the amount of Prepaid Expenses,
(vi) the amount of the Overdrafts, (vii) the amount of any fees, charges or
accrued interest receivable on such Overdrafts, (viii) the unpaid principal
amount of the Loans and the amount of accrued interest receivable on all such
Loans, net of loan loss reserve, and (ix) the amount of the Purchase Premium.
3.2 Adjustments. Subject to the provisions of Section 4.4 and Article
9, the assignments, transfers, acceptances and assumptions of the Assets and the
Liabilities
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and the payment of the amounts due in respect thereof in accordance with
Sections 2.2 and 3.1 shall be final and without recourse and not subject to any
claim for reimbursement, repayment, rescission or avoidance; provided, however,
that:
(a) The following adjustments shall be made:
(i) As soon as practicable after the Closing Date, but in no
event later than sixty (60) calendar days thereafter, the Seller shall
deliver the Final Financial Statement to the Buyer. Subject to the
Seller's and Buyer's rights of indemnification pursuant to Section 4.4
and Article 9, the Final Financial Statement shall become final and
binding on the Buyer and the Seller ten (10) calendar days after its
delivery to the Buyer, unless the Buyer gives written notice to the
Seller of its disagreement with respect to any item included in such
Final Financial Statement. The Seller and the Buyer shall use their
respective reasonable efforts to resolve the disagreement during the
ten (10) calendar day period following receipt by the Seller of the
notice. If the disagreement is not resolved during such ten (10)
calendar day period, the parties shall follow the procedures set forth
in Section 9.4 to resolve such dispute and such Final Financial
Statement shall be modified by any such resolution, whereupon the Final
Financial Statement shall become final and binding. When the Final
Financial Statement becomes final and binding, the Seller shall pay the
Buyer or the Buyer shall pay the Seller, as appropriate, the difference
between the amount paid at the Closing and the amount calculated on the
Final Financial Statement, plus interest accrued from the Closing Date
at the Federal Funds Rate in effect on the Closing Date. In the event
such amounts are not paid by Seller or Buyer, as appropriate, within
three (3) Business Days from the date the Final Financial Statement
becomes final and binding, then such amounts shall accrue interest
until paid at the Federal Funds Rate in effect on the Closing Date plus
five percent (5%) per annum, but in no event in excess of the highest
rate permitted by applicable law.
(b) If any non-material Asset (materiality to be determined by Seller
in good faith) shall not have been assigned to the Buyer (or Newco in the case
of the Stock Purchase) at the Closing, then the Seller shall use its reasonable
efforts to assign such Asset to the Buyer as soon as possible after the Closing
Date but in any event no later than on the Settlement Date. In the event the
Seller for any reason is unable to assign any such Asset to the Buyer on or
prior to the Settlement Date, then the Seller shall no longer have any
obligation to assign such Asset to the Buyer and the Seller shall refund to the
Buyer the value of such Asset as reflected on the Closing Financial Statement
together with interest on such amount accrued from the Closing Date through the
date of such refund at the Federal Funds Rate in effect on the Closing Date;
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(c) All operating expenses and fees accrued or prepaid prior to the
Closing Date, including, without limitation, wages, salaries, rents, Bank
Insurance Fund ("BIF") premiums, utility payments, telephone charges,
maintenance contract payments, personal property taxes, non-delinquent real
property taxes and assessments relating to the Assets and the Liabilities
transferred at the Closing, but excluding fees for use of safe deposit boxes,
shall be prorated between the parties as of the Closing Date. With respect to
the BIF premiums, the proration shall be on the basis set forth in Section
3.2(d). To the extent that the Seller has paid expenses that are expenses
allocable to the Buyer pursuant to this Section 3.2(c), such expenses shall
appear as an asset on the Financial Statements. To the extent that expenses have
been accrued and not paid by the Seller prior to the Closing Date, such expenses
shall appear as a liability on the Financial Statements;
(d) With respect to the proration of BIF premiums, Buyer shall
reimburse Seller for the amount of any BIF assessments that Seller is required
to pay for periods in which the Assumed Deposits are included in the Seller's
deposit insurance assessment base but during which periods Buyer has liability
for the Assumed Deposits. The amount of such reimbursement will be included as a
Prepaid Expense on the Financial Statements;
(e) All loan commitment fees and any other fees accrued by or paid to
the Seller prior to the Closing Date related to the loan commitments included as
Loans pursuant to this Agreement and to any periodic fees paid or payable to
Seller with respect to the Loans shall be pro-rated between the Buyer and the
Seller. To the extent that the Seller has received fees that are fees allocable
to the period on and after the Closing Date, such fees shall appear as a
liability on the Financial Statements. To the extent that such fees allocable to
a period prior to the Closing Date have not been paid to Seller prior to the
Closing Date, such fees shall appear as an asset on the Financial Statements;
(f) As soon as practicable after the Closing Date, the Seller will
provide to the Buyer a report of customer data for the Assumed Deposits showing
the names, addresses, tax identification numbers (where available from the
Seller's records) and deposit balances of each and all of the customers with
Assumed Deposits as of such date; the customer data shall include the signature
cards in the possession of Seller for all Assumed Deposits and a list of
Accounts subject as of the Closing Date to annual Taxpayer Identification Number
solicitation by Seller in the normal course of its business;
(g) With respect to ▇▇▇ Deposits, the Seller will use reasonable
efforts and will cooperate with the Buyer, both
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before and after the Closing, in taking whatever actions are reasonably
necessary to accomplish either the appointment of the Buyer as successor
custodian, the adoption of Buyer's form of ▇▇▇ plan (or such plan of an
Affiliate of Buyer), or the delegation to the Buyer (or an Affiliate of the
Buyer) of the Seller's authority and responsibility as custodian of all such ▇▇▇
Deposits, including but not limited to, sending to the depositors thereof
appropriate notices, and filing any appropriate applications with applicable
regulatory authorities. If any such delegation is made to the Buyer (or such
Affiliate), the Buyer (or such Affiliate) will perform all of the duties so
delegated and comply with the terms of the Seller's agreement with the depositor
of the ▇▇▇ Deposits affected thereby;
(h) With respect to Deposits which are ▇▇▇▇▇ Accounts, the Seller will
use reasonable efforts and cooperate with the Buyer to invite trustees of ▇▇▇▇▇
plans to appoint the Buyer (or an Affiliate of the Buyer) as successor custodian
of each ▇▇▇▇▇ Account and related Deposit thereof, and to adopt the Buyer's (or
such Affiliate's) form of ▇▇▇▇▇ Master Plan as a successor to that of the
Seller. The Buyer (or such Affiliate) will assume no Deposits which are ▇▇▇▇▇
Accounts unless the Buyer (or such Affiliate) has received the documents
necessary for such assumption or transfer at or before the Closing. With respect
to any depositors who do not transfer such accounts to the Buyer's (or such
Affiliate's) form of ▇▇▇▇▇ Master Plan, the Seller will use reasonable efforts
in order to enable the Buyer (or such Affiliate) to retain such ▇▇▇▇▇ Accounts
at the Branches at which such accounts were maintained;
(i) Any items that were credited for deposit to or cashed against an
Assumed Deposit prior to the Closing and are returned unpaid (each, an
"RI") within 60 days after the Closing Date will be handled as follows:
(A) Within one (1) Business Day after receipt of any RI by the
Seller, the Seller will fax to the Buyer a list reflecting the
amount of such RI, the date of deposit and depositor's account
number (if available) and the Seller will forward a
consolidated collection request with the original RIs (a
"Collection Advice"), to the Buyer via Seller's courier, at
Buyer's expense.
(B) Upon receipt of a Collection Advice, the Buyer will place
holds on the respective customers' deposit accounts with the
Buyer ("Customer Account") in an amount not less than the
amount of the RI and take any actions necessary to ensure that
such deposits are not withdrawn.
(C) Within one (1) Business Day after receipt of such
Collection Advice and original RI, the Buyer will debit the
available Customer Account and/or overdraw
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the Customer Account and return the paid collection request to
the Seller. If there are not sufficient funds in the Customer
Account because of the Buyer's failure to honor holds placed
on such Customer Account, the Buyer shall repay the amount of
the RI to the Seller. RIs that overdraw an account balance
shall be held by the Buyer unless requested by the Seller
during the collection process. The Buyer will release RIs to
depositors only upon receipt of sufficient good funds to cover
any deficient balances.
(D) A list reflecting name, address, phone number and amount
of accounts overdrawn $500 or more, resulting from an RI
forwarded by the Seller being charged to the Customer Account,
shall be faxed to the Seller, Attention: Loss Prevention
Manager, fax number ▇▇▇-▇▇▇-▇▇▇▇, on the date such item is
charged back.
(E) The Seller will be responsible for collecting overdrawn
balances of RIs over $500. The Buyer will cooperate with the
Seller with respect to providing information or records that
may be needed to pursue resolution of amounts due to the
Seller. The Buyer will be responsible for reasonable
collection efforts on overdrawn balances of RIs of $500 or
less.
(F) After a period of 60 days from the date a Customer Account
is charged for an RI and becomes overdrawn, the Buyer will
submit a collection request to the Seller for any remaining
balances that could not be collected. The original RIs
received shall be returned to the Seller with the collection
letter.
(G) Customer disputes regarding Buyer's rights to debit
Customer Accounts will be reviewed with Seller's Loss
Prevention Manager for resolution. The Buyer agrees to
cooperate with the Seller in debiting Customer Accounts for
RIs, except in such cases when Seller's negligence is the
basis of a defense by the customer to Buyer's right to debit
the Assumed Deposit(s).
(H) Claims involving checks paid prior to Closing, drawn
against Accounts sold, which are subsequently disputed to be
forged or otherwise unauthorized, shall be referred to
Seller's Loss Prevention Manager for resolution.
(ii) Any RIs that are returned unpaid more than sixty (60) calendar
days after the Closing Date will be the responsibility of the Buyer,
except that Seller shall be responsible, for a period of eighteen (18)
months after the Closing Date, for RIs when such items are one of the
following: checks drawn on the United States Treasury,
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checks issued by state governments or municipalities or checks returned
for endorsement irregularities; provided that the Buyer shall cooperate
with Seller as provided in subsection 3.2(i)(i) above to obtain
collection of such items from the applicable Customer Account.
(j) As soon as practicable, but in any event no later than five (5)
calendar days after the Closing Date, the Buyer shall mail to each depositor in
respect of a Transaction Account (included in the Assumed Deposits) a letter
approved in writing by the Seller requesting that such depositor promptly cease
writing checks or drafts on the Seller's check stock against such Transaction
Account. At such time as the Buyer mails each such notice to each such
depositor, the Buyer shall also forward to each such depositor new checks on the
Buyer's stock, which checks the depositor may draw upon the Buyer for the
purpose of effecting transactions with respect to such Transaction Accounts.
The parties hereto shall use reasonable efforts to develop procedures
that cause checks drawn on the Seller's form of check stock against Transaction
Accounts that are received after the Closing Date to be cleared through the
Buyer's then current clearing procedures.
During the ninety (90) calendar day period following the Closing Date,
if it is not possible to clear Transaction Account drafts through the Buyer's
then current clearing procedures after the Closing Date, the Seller shall
forward to the Buyer no later than the next Business Day after receipt thereof
all such Transaction Account drafts drawn against Assumed Deposit Accounts. The
Seller shall have no obligation to pay such Transaction Account drafts. Upon the
expiration of such ninety (90) calendar day period, the Seller shall cease
forwarding drafts against Transaction Accounts transferred on the Closing Date
and shall instead return them to the originators marked "Refer to Maker-Branch
Sold." The Buyer will compensate the Seller for processing of drafts as
described in this Section 3.2(j) according to the compensation arrangement set
forth in Section 4.6;
(k) Collection of Overdrafts, if any such collection is effected by the
Buyer in its sole discretion, shall be the sole responsibility of the Buyer. At
the Buyer's request, the Seller will use reasonable efforts to cooperate to
assist in collection of Overdrafts, but the Seller shall not be required to
incur any fees or expenses (including legal or other professional fees) other
than the indirect costs associated with the employment of Seller's existing
employees in connection with rendering such assistance.
(l) In connection with the transfer of the Loans, Seller and Buyer
agree as follows:
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(i) The parties will cooperate and use their reasonable
efforts to cause Buyer to become the beneficiary of credit life,
accident and health, vendor's single interest premium or similar
insurance purchased by or on behalf of customers on the Loans. For the
duration of such insurance, Seller and Buyer agree to cooperate in good
faith to develop a mutually satisfactory method by which the issuer of
such insurance will make rebate payments to and satisfy claims of the
holders of such certificates of insurance after the Closing Date.
(ii) Each of Buyer and Seller will use their reasonable
efforts to comply with all notice and reporting requirements of the
Loan documents or of any law or regulation with respect to the transfer
of such Loans.
(iii) Within thirty (30) calendar days after the Closing Date
or the Supplemental Loan Closing (as appropriate), Buyer will, at its
expense, issue new coupon books or similar payment notices for payment
of Loans with instructions to use Buyer's coupons or statements and to
destroy unused coupons furnished by Seller.
(iv) For a period of sixty (60) calendar days after the
Closing Date or the Supplemental Loan Closing (as appropriate), within
five (5) Business Days after receipt by Seller of any check or money
order made payable to Seller representing payment on a Loan, such item
shall be settled in accordance with mutual settlement procedures to be
agreed between Seller and Buyer as soon as practicable following the
date hereof. If the item is returned unpaid, however, Seller shall
promptly notify Buyer of such item's return and shall forward the
original of such item to Buyer. Within three (3) Business Days after
receipt of such returned item, Buyer shall issue and forward a
cashier's check or wire transfer to Seller in the amount of such item,
and Buyer shall be responsible for any further efforts to collect such
item.
(v) If the balance due on any Loan has been reduced by Seller
as a result of a payment by check received prior to the Closing Date or
the Supplemental Loan Closing (as appropriate), which item is returned
after the Closing Date or the Supplemental Loan Closing (as
appropriate), the asset value representing the Loan transferred shall
be correspondingly increased and an amount in cash equal to such
increase shall be paid by Buyer to Seller promptly upon demand. Such
amounts shall be debited or credited, where applicable, from Buyer's
correspondent bank account maintained with Seller.
ARTICLE 44
Additional Covenants
4.1 Seller's Covenants. The Seller (and, to the extent specifically
indicated below, the Buyer) agrees:
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(a) To use reasonable efforts to sign and deliver to the Buyer such
additional agreements and other documents, and to do such other acts and things,
as may be required to complete the transactions contemplated by this Agreement.
(b) To reasonably cooperate with the Buyer in obtaining all
governmental and regulatory consents, approvals, licenses, waivers and the like
required to be fulfilled or obtained for the completion of the transactions
contemplated by this Agreement.
(c) To deliver to the Buyer those Records relating solely to the Assets
and the Liabilities and being easily segregable from the Seller's other records,
as soon as practicable after the Closing and to store the other books, records
and accounts of the Facilities relating to the Seller's former operation of the
Facilities for the applicable period required by law.
(d) Until Closing or the earlier termination of this Agreement, to
cause the business of the Facilities to be conducted in accordance with Section
2.3 above.
(e) To remove all signage from the Facilities at the expense of the
Seller on or before the Closing Date, it being understood that the Buyer shall
be responsible for installation of its signage at its sole expense on or after
the Closing Date.
(f) As soon as practicable after the receipt of all regulatory
approvals required by Sections 7.1(c) and 7.2(c) with respect to all Facilities,
and no later than thirty (30) calendar days prior to the Closing Date (unless
earlier required by law, regulation or regulatory policy), each of the Seller
and the Buyer shall provide, or join in providing where appropriate, all
notices, separately as to each Branch, to holders of Deposits, borrowers under
the Loans and other persons that the Seller or the Buyer, as the case may be, is
required to give by any regulatory authority having jurisdiction or under
applicable law or the terms of any other agreement between the Seller and any
customer in connection with the transactions contemplated hereby. A party
proposing to send or publish any notice or communication pursuant to this
Section 4.1(f) shall furnish to the other party a copy of the proposed form of
such notice or communication as soon as practicable in advance of the proposed
date of the first mailing, posting, or other dissemination thereof to customers,
and shall not unreasonably refuse to amend such notice to incorporate any
changes that the other such party proposes as necessary to comply with
applicable statutes, rules, regulations or requirements of any regulatory
authority having jurisdiction. All costs and expenses of any notice or
communication sent or published by the Buyer or the Seller
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shall be the responsibility of the party sending such notice or communication.
All out-of-pocket costs and expenses of any joint notice or communication which
Buyer or Seller pays to a third party vendor shall be shared equally by the
Seller and the Buyer. Each party shall bear the costs and expenses of its own
employees or agents engaged in any joint notice or communication.
(g) The Seller will use reasonable efforts to transfer to the Buyer on
or as soon as practicable after the Closing Date all of those automated clearing
house and fed wire direct deposit arrangements which are tied by agreement or
other standing arrangement to Assumed Deposits. For a period of ninety (90)
calendar days after the Closing Date, in the case of automated clearing house
direct deposits to Assumed Deposits, and thirty (30) calendar days after the
Closing Date, in the case of fed wire direct deposits to Assumed Deposits (each,
a "Direct Deposit Cut-off Date"), the Seller will, no later than the next
Business Day following the date of receipt thereof, remit and transfer to the
Buyer all direct deposits intended for Accounts which are Assumed Deposits.
After the applicable Direct Deposit Cut-off Date, the Seller may discontinue
accepting and forwarding automated clearing house and fed wire entries and funds
and return such direct deposits to the originators. The Seller shall not be
liable for any account overdrafts that may thereby be created or for any other
matter. The Seller will not be obligated to accept new direct deposit
arrangements on any Account after the date that all regulatory approvals
required under Sections 7.1(c) and 7.2(c) (except for statutory waiting periods)
have been received, nor will the Seller be obligated to remit or transfer with
respect to any direct deposit arrangements other than by electronic
transmission. At the time of each Direct Deposit Cut-off Date, the Buyer will
provide automated clearing house originators with account numbers and conversion
tapes relating to Assumed Deposits.
(h) As soon as practicable after the receipt of all regulatory
approvals required by Sections 7.1(c) and 7.2(c) with respect to all Facilities
(except for statutory waiting periods), and after the notice provided in Section
4.1(f), the Buyer will send appropriate notice to all holders of Deposits which
are to be assumed by the Buyer at the Closing the terms of which provide for
direct debit of such accounts by third parties ("Direct Debit Accounts"),
instructing such customers concerning transfer of customer direct debit
authorizations from the Seller to Buyer. The Seller shall cooperate in
soliciting the transfer of such authorizations. Such notice shall be in a form
agreed to by the parties. For a period of ninety (90) calendar days following
the Closing Date, the Seller will, on the Business Day following the date of
receipt thereof, forward to the Buyer all direct debits on Direct Debit Accounts
and will give the Buyer a daily accounting by electronic transmission of such
debits to the Buyer's clearing account. Thereafter, the Seller may discontinue
forwarding
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such entries and return them to the originators marked "Refer to Maker--Branch
Sold." The Seller will not be obligated to accept new direct debit arrangements
on any Account after the date that all regulatory approvals required under
Sections 7.1(c) and 7.2(c) (except for statutory waiting periods) have been
received, nor will the Seller be obligated to forward such direct debits or give
an accounting thereof other than by electronic transmission. At the time of the
Closing Date, the Buyer will provide automated clearing house originators of
such direct debits with account numbers and conversion tapes.
(i) In addition to the requirements and procedures set forth in
Sections 4.1(g) and 4.1(h), the Buyer shall, commencing on the first Business
Day following the Closing Date, deliver to the originators of the direct
deposits of Assumed Deposits and the originators of direct debits of Assumed
Deposits specified in such sections, notices of change instructing such
originators to change the routing transit number for such deposits and debits
from the Seller's routing transit number to the Buyer's routing transit number.
(j) From and after the Closing, the Seller will not:
(i) use any of the information contained in the Records for any
purpose other than for the purpose of enforcing rights and
performing obligations arising under this Agreement; and
(ii) for a period of eighteen (18) months following the Closing
Date, conduct or, following the closing of the
BankAmerica/NationsBank Business Combination, permit the New
Mexico operations of NationsBank, N.A., to conduct, any
solicitation of depositors of the Assumed Deposits, except in
connection with general solicitations or general advertising
not targeted specifically at the depositors of the Assumed
Deposits.
4.2 Buyer's Covenants. The Buyer agrees:
(a) To use reasonable efforts to sign and deliver to the Seller such
additional agreements and other documents, and to do such other acts and
things, as may be required to complete the transactions contemplated by this
Agreement.
(b) To use its best efforts to fulfill all governmental, regulatory and
other requirements (including, without limitation, obtaining the approval of all
New Mexico and federal bank or other financial institution regulatory agencies
and any other governmental entity having jurisdiction over the Buyer's
acquisition of the Facilities or the Buyer) required to be fulfilled by the
Buyer for the completion of the transactions contemplated by this Agreement, and
to take the initial drafting responsibility therefor. The Seller shall have the
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right to review and comment upon all applications to, and filings with,
governmental and regulatory agencies and entities made for the above purpose,
prior to their filing; provided that, the Seller shall have no responsibility
for any such application or filing. Without limiting the generality of the
foregoing, Buyer agrees to file all required regulatory applications within
thirty (30) calendar days after the date of this Agreement.
(c) To pay, honor, discharge and perform all liabilities and
obligations in respect of the Assets and the Liabilities and any other
liabilities of the Facilities arising, accruing or subsisting after the Closing
which the Buyer is obligated to assume pursuant to this Agreement, subject to
applicable indemnification rights of the Buyer.
(d) Not to use, keep or claim any registered or unregistered trademark,
trade name, service ▇▇▇▇ or other identification commonly associated with the
Seller, or any sign, display or similar material of the Seller or any banking or
other forms, stationery, passbooks, checks, traveler's checks, cashier's checks,
manager's checks or similar banking material of the Seller or bearing the
Seller's name or other similar marks or identification (except to the extent
necessary to conduct business operations, and then only if the Seller's name,
marks or identification are obliterated from such material, and such material is
clearly identified as that of the Buyer), or any proprietary material of the
Seller, including, without limitation, operating manuals, training manuals and
public relations, explanatory or advertising materials.
(e) As of the Closing Date, to become the "holder," as that term is
defined in New Mexico's Uniform Unclaimed Property Act, Sections 7-8-1 through
7-8-40 of the NMSA, of all Assumed Deposits and safe deposit boxes which the
Buyer assumes under this Agreement. The Buyer will be responsible for the
escheat of any property for which it becomes the holder and which becomes
abandoned during the calendar year in which the Closing occurs.
(f) On and following the Closing Date, to honor and comply with the
terms of all holds, levies, garnishments, tax liens, orders, pledges,
guardianship agreements and other restrictions that are in effect on the Assumed
Deposits as of the Closing Date.
(g) On and following the Closing Date, to assume and discharge, in the
usual course of banking business, Seller's obligations with respect to the safe
deposit box business at the Branches in accordance with the terms and conditions
of contracts or rental agreements related to such business, and to maintain all
records related to such agreements and facilities necessary for the use of such
safe deposit boxes by persons entitled to use them.
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(h) To continue to operate each of the Branches at its current location
for a period of at least ninety (90) calendar days after the Closing Date
(unless Buyer has provided Seller written confirmation from Buyer's appropriate
banking regulatory agency that any earlier change in location by Buyer would be
exempt from the notice and other requirements of 12 U.S.C. Sec. 1831r-1).
(i) To obtain approval of this Agreement and the transactions
contemplated hereby by the requisite vote or consent of the holders of
outstanding securities of the Buyer if such approval is required by applicable
law, contract, the Buyer's Articles of Association or Bylaws, or otherwise.
(j) Not to take any actions that will injure Seller's present business
relations with its depositors, customers and others, and not, either before or
after the Closing, to commit any act, or in any way assist others to commit any
act, that injures Seller or the business heretofore conducted by Seller, and,
without limiting the generality of the foregoing, not to divulge any
confidential information or make available to any others any documents, files or
other papers concerning the business or financial affairs of Seller.
4.3 Consents. The Seller shall use its reasonable efforts to obtain any
nongovernmental consents required for the transfer or assignment of the Assets
and Liabilities to Buyer (or Newco in the case of the Stock Purchase) pursuant
to this Agreement, including (a) Leases, if any, and (b) Assumed Contracts, if
any; provided, however, that (i) the Seller shall not be required to pay any
additional compensation or fee to any person or entity to obtain any such
consent, (ii) the Buyer agrees that it shall provide reasonable assistance to
the Seller to obtain such consents, and (iii) the Seller shall be entitled to
rely on the provisions of Sections 2.2(e) and 2.2(f) and the final paragraph of
Section 7.2 if Seller does not obtain one or more such consents.
4.4 Environmental Matters.
(a) The provisions of this Section 4.4 shall exclusively govern the
rights and obligations of the Seller and Buyer with regard to Hazardous
Substances.
(b) Seller has delivered to the Buyer copies of a Phase I Environmental
Site Assessment ("Phase I") and an Asbestos Survey ("Asbestos Survey") regarding
each tract of Real Estate; provided that Seller has not delivered an Asbestos
Survey regarding any Branch or Office where construction of all Improvements was
completed after December 31, 1980. In addition, Seller has delivered to the
Buyer an Asbestos Survey for each of the Northtowne, Rio Bravo and Ladera
Branches. The dates of such Phase I's and Asbestos Surveys and the names of the
persons by whom they were prepared are listed on Schedule
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4.4(b). The cost of such Phase I's and Asbestos Surveys shall be borne by the
Seller.
The Buyer acknowledges and agrees that:
(i) Seller is furnishing copies of the Phase I's and Asbestos
Surveys to Buyer for informational purposes only and without
representation or warranty as to the accuracy or completeness of the
contents of such materials except as otherwise provided in this
Section 4.4;
(ii) Buyer will not rely on the Phase I's or Asbestos Surveys
and will conduct its own due diligence on the matters contained in the
documents; and
(iii) Buyer is not purchasing the Real Estate, Improvements
and Leasehold Improvements and accepting assignment of the Leases in
reliance upon any representations or warranties of any kind whatsoever
made by the Seller (or any representatives, agents or employees of the
Seller) except those made or contained in this Agreement.
Buyer and Seller acknowledge and agree that, prior to Closing, Buyer
will have the opportunity to independently and personally inspect the Real
Estate, Improvements, Leased Real Estate and Leasehold Improvements (sometimes
referred to collectively in this Section 4.4 as the "Subject Assets"). Buyer
further acknowledges and agrees that Buyer has entered into this Agreement based
upon this right of inspection. It is expressly agreed and understood that Seller
has made no representation or warranty as to the condition of any of the Subject
Assets or their suitability for any particular purpose except as expressly set
forth in this Agreement. Buyer agrees that the Real Estate, Improvements and
Leasehold Improvements are to be sold to and purchased by Buyer, and the Leases
assigned to and accepted by Buyer, "AS IS" AND "WHERE IS," WITH ALL FAULTS, IF
ANY, INCLUDING, WITHOUT LIMITATION, THE ENVIRONMENTAL CONDITION OF THE PROPERTY,
AND WITHOUT ANY WARRANTY WHATSOEVER, EXPRESS OR IMPLIED, except as expressly set
forth in this Agreement.
(c) During the thirty (30) Business Day period starting on the date of
this Agreement ("Environmental Due Diligence Period"), Buyer shall have the
right to conduct environmental assessments, investigations, reviews or testing
performed by Buyer or any third party or consultant engaged by Buyer to conduct
such study (collectively, "Environmental Assessments") of the Subject Assets,
and Buyer and Buyer's representatives, agents and designees will have the right,
at reasonable times and upon reasonable notice to Seller (which notice must
describe the scope of the planned testing and investigations) to enter upon the
Real Estate and Leased Real Estate subject to the terms and conditions set forth
in Exhibit H.
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(d) During the Environmental Due Diligence Period, Buyer may notify
Seller in writing of any objections relating to any aspects of the Subject
Assets relating to one or more Facilities (the "Affected Facilities") pertaining
to presence of any Hazardous Substances, compliance with all applicable
Environmental Laws, any matters disclosed in the Phase I's or Asbestos Surveys,
any matters disclosed by Seller, or any matters disclosed in any Environmental
Assessments.
(i) In the event that Buyer fails to so notify Seller of any
such objections, Buyer shall be deemed to have approved such items.
(ii) In the event, however, that Buyer notifies Seller in
writing and within the Environmental Due Diligence Period of any such
objections, the parties will have a period of ten (10) Business Days
to agree upon a resolution of the objection(s). If the parties cannot
agree within such period of ten (10) Business Days, then within five
(5) Business Days after the expiration of such period either party may
initiate a proceeding to resolve such objections pursuant to the
procedures set forth in Section 9.4 of this Agreement; provided,
however, that within such five (5) Business Days the Seller in its
sole discretion may, in a case where Buyer has notified Seller of
objections with respect to Real Estate or Improvements, elect to
remove the Real Estate and Improvements relating to the Affected
Facilities from the Assets to be sold and transferred to Buyer, in
which event (A) the consideration payable under Article 3 shall
automatically be adjusted accordingly and (B) commencing on the
Closing Date Buyer shall lease the Real Estate and Improvements
relating to the Affected Facilities from Seller for a period of at
least six (6) months, at a rental rate and on terms to be agreed upon
by Buyer and Seller, which rate and terms shall be commercially
reasonable and comparable to those for similar properties in the
vicinities of the Affected Facilities, and provided further, that if
Buyer and Seller do not agree upon the rental rate or one or more such
terms within an additional ten (10) Business Days after expiration of
the five (5) Business Day period referred to above, then the
determination of such rate and/or term(s) shall be immediately
submitted to arbitration pursuant to the procedures set forth in
Section 9.4 of this Agreement. In a case where Buyer has notified
Seller of objections with respect to Leased Real Estate or Leasehold
Improvements, then if neither party has initiated a proceeding to
resolve such objections pursuant to the procedures set forth in
Section 9.4 of this Agreement within the five (5) Business Days
referred to in the immediately preceding sentence, then the Seller in
its sole
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discretion may elect to exercise its right under the final paragraph of
Section 7.2 to exclude the Affected Facility (but not the other Assets
and Liabilities related thereto) from the Closing.
(iii) If this Agreement is not amended or otherwise modified
pursuant to the provisions of the foregoing Section 4.4(d)(ii), Buyer
shall be deemed to have waived its objections and this Agreement will
continue in full force and effect.
(e) (i) Subject to Subsection 4.4(e)(iii) and Article 9 below,
if there are any third party claims against Buyer that arise out of any
Hazardous Substances that became located in, on or under Real Estate
during Seller's ownership of the Real Estate, or in, on or under Leased
Real Estate during the term of Seller's Lease, Seller will (to the
extent the Seller is liable for such Hazardous Substances under any
federal, state or local law pertaining to or concerning Hazardous
Substances) indemnify, defend (by counsel reasonably acceptable to
Buyer), protect and hold Buyer harmless for, from and against any and
all claims, liabilities, penalties, forfeitures, losses or expenses
(including, without limitation, reasonable expenses of investigation
and attorney's fees and expenses in connection with any action, suit or
proceeding brought against the Buyer) arising therefrom (to the extent
that any such third party claims are attributable to the portion of the
Hazardous Substances which occurred or were in existence at the Real
Estate or Leased Real Estate on or prior to the Closing Date) in an
amount which (together with any amount for which Seller may become
liable to provide indemnification pursuant to Section 9.2 or
otherwise), shall not exceed the amount of $5,000,000, and provided
that notwithstanding any other provision hereof, Seller shall not be
liable under this Section 4.4(e)(i) for any losses sustained by the
Buyer unless and until the aggregate amount of all losses with respect
to a Facility sustained by the Buyer to be indemnified by the Seller
under this Agreement (including any amount for which Seller may become
liable to provide indemnification pursuant to Section 9.2 or
otherwise), shall exceed $100,000, in which event the Seller shall be
liable only for such losses in excess of $100,000 with respect to that
Facility (it being the intention of the parties that losses sustained
by the Buyer with respect to one Facility shall not be combined with
losses sustained with respect to another Facility to satisfy such
minimum $100,000 amount).
(ii) Subject to Subsection 4.4(e)(iii) and Article 9 below, if
there are any third party claims against Seller that arise out of any
Hazardous Substances that became located in, on or under the Real
Estate or Leased Real Estate at any time after the Closing, Buyer will
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indemnify, defend (by counsel reasonably acceptable to Seller), protect
and hold Seller harmless for, from and against any and all claims,
liabilities, penalties, forfeitures, losses or expenses (including,
without limitation, reasonable expenses of investigation and attorney's
fees and expenses in connection with any action, suit or proceeding
brought against the Seller) arising therefrom, provided that
notwithstanding any other provision hereof, Buyer shall not be liable
under this Section 4.4(e)(ii) for any losses sustained by the Seller
unless and until the aggregate amount of all losses with respect to a
Facility sustained by the Seller to be indemnified by the Buyer under
this Agreement (including any amount for which Buyer may become liable
to provide indemnification pursuant to Section 9.3 or otherwise), shall
exceed $100,000, in which event the Buyer shall be liable only for such
losses in excess of $100,000 with respect to that Facility (it being
the intention of the parties that losses sustained by the Seller with
respect to one Facility shall not be combined with losses sustained
with respect to another Facility to satisfy such minimum $100,000
amount).
(iii) Nothing in this Section 4.4(e) is meant to diminish any
party's rights or obligations under any federal, state or local law
pertaining to or concerning Hazardous Substances; but Seller will not
be liable to Buyer under this Agreement, and Buyer hereby releases
Seller from any and all liability under any such law, for any third
party claims which are attributable to any environmental condition
which:
(A) was described or referred to in the Phase I's,
Asbestos Surveys or any Environmental Assessments obtained or
conducted by Buyer;
(B) was reasonably discoverable by prudent
investigation during the Environmental Due Diligence Period;
or
(C) was otherwise disclosed by Seller to Buyer or
discovered by Buyer at any time prior to the Closing.
(iv) The above release includes claims of which Buyer is
presently unaware or which Buyer does not presently suspect to exist
which, if known by Buyer, would materially affect Buyer's release(s) to
Seller. It is understood and agreed that the purchase price has been
adjusted by prior negotiations to reflect that all of the Real Estate,
Improvements, Leasehold Improvements and the Furniture, Fixtures and
Equipment are sold by Seller and purchased by Buyer and Buyer is
accepting assignment of the Leases subject to the foregoing. The sole
remedy of the Buyer will be to exercise its rights under Section 4.4(b)
prior to the end of the Environmental Due Diligence Period.
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4.5 Valuation of the Assets. Buyer agrees that it is relying solely
upon its own judgment as to the value of the Assets and the Liabilities (and the
Shares in the case of the Stock Purchase), and Seller hereby disclaims any
representations or warranties made by Seller as to their condition, value,
nature or amount except those made in Section 5.1 of this Agreement, and subject
to the provisions of Section 4.4 of this Agreement, which shall exclusively
govern the rights and obligations of the parties with regard to Hazardous
Substances.
4.6 Clearing Items. From the Closing Date and for ninety (90) calendar
days thereafter, items drawn on Transaction Accounts assumed by the Buyer may
continue to be presented to the Seller. The Seller will make provisional
settlement to the presenting institution and will forward such items to the
Buyer, via courier, at Buyer's expense, no later then the next Business Day
after receipt thereof, and the Buyer will reimburse the Seller for such
provisional settlement. For the first ninety (90) calendar days following the
Closing Date, the Seller shall perform its obligations under the first two
sentences of this Section 4.6 at no cost to the Buyer. After ninety (90)
calendar days from the Closing Date, the Buyer will pay the Seller $10.00 for
each item processed by the Seller. Upon timely presentation to the Buyer, the
Buyer will assume all responsibility for such items (except for such items which
have not been handled by the Seller in accordance with applicable law or
regulation, or with ordinary care), including but not limited to determining
whether to honor or dishonor such items and giving any required notification for
the return of large items.
4.7 ▇▇▇ Deposits and ▇▇▇▇▇ Accounts. The Seller will deliver to the
Buyer, on the Closing Date, copies of the Seller's documents for each ▇▇▇
Deposit and ▇▇▇▇▇ Account which is included in the Assumed Deposits. The Seller
will prepare and file all reports to government authorities required to be filed
for the period ending on the Closing Date and all prior periods. The Buyer will
be responsible for all such reporting for periods commencing on the day after
the Closing.
4.8 Interest Reporting and Withholding.
(a) Except as set forth in Section 4.8(b), for the period from January
1 of the year in which the Closing occurs through the Closing Date, Seller will
provide to Buyer all information necessary for Buyer to report to applicable
taxing authorities and owners of Assumed Deposits transferred on the Closing
Date, all interest credited to, withheld from and any early withdrawal penalties
imposed upon the Assumed Deposits during
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such period (collectively, the "Reported Amounts"). With respect to all periods
beginning on or after January 1 of the year in which the Closing occurs, Buyer
will report all Reported Amounts to applicable taxing authorities and owners of
Assumed Deposits transferred on the Closing Date.
(b) With respect to any Assumed Deposits for which amounts are required
by any governmental agency to be withheld (the "Withholding Accounts"):
(i) Seller will: (A) for the period from January 1 of the year
in which the Closing occurs through the Closing Date, report all
Reported Amounts incurred during such period on the Withholding
Accounts to applicable taxing authorities and to the owners of the
Withholding Accounts; and (B) withhold any amounts required by any
governmental agencies to be withheld from the Withholding Accounts on
or before the Closing Date in accordance with applicable law or
appropriate notice from any governmental agency and remit such amounts
to the appropriate agency on or prior to the applicable due date.
(ii) Buyer will: (A) for the period from the day after the
Closing Date to the end of the calendar year (and all periods
thereafter), report all Reported Amounts incurred during such period on
the Withholding Accounts to applicable taxing authorities and to the
owners of the Withholding Accounts; and (B) withhold any amounts
required by any governmental agencies to be withheld from the
Withholding Accounts after the Closing Date in accordance with
applicable law or appropriate notice from any governmental agency and
remit such amounts to the appropriate agency on or prior to the
applicable due date.
(c) Buyer shall report to applicable taxing authorities and the
borrowers of the Loans all interest paid on such loans for the year in which
such loans are acquired by Buyer.
4.9 Eminent Domain or Taking. If proceedings under a power of eminent
domain relating to a specific Facility or any part thereof (the "Taking
Facility") are commenced prior to the Closing Date, Seller will promptly inform
Buyer in writing.
(a) If such proceedings involve the taking of all of or a material
interest in the Taking Facility, Buyer may elect to terminate this Agreement
with respect to such Taking Facility (but not the other Assets and Liabilities
related thereto) by notice in writing sent within ten (10) calendar days of
Seller's written notice to Buyer, in which case neither party will have any
further obligation to or rights against the other with respect to the Taking
Facility except with respect to the Deposits of such Facility and except any
rights or obligations
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of either party which are expressly stated to survive termination of this
Agreement.
(b) If the proceedings do not involve the taking of all of or a
material interest in the Taking Facility , or if Buyer does not elect to
terminate this Agreement as to the Taking Facility, this transaction will be
consummated as described herein, and, subject to the Lease, if any, or other
encumbrances, if any, relating to the Taking Facility, any award or settlement
payable with respect to such proceeding will be paid or assigned to Buyer on the
Closing Date.
(c) If the Closing contemplated by this Agreement is not consummated
for any reason, Buyer will have no claim to any condemnation award or settlement
with respect to the Taking Facility.
4.10 Damage or Destruction. Except as provided in this Section 4.10,
prior to the Closing Date, as between Seller and Buyer the entire risk of loss
or damage by earthquake, flood, landslide, fire or other casualty is borne and
assumed by Seller. If, prior to the Closing Date, any part of the Improvements
or Leasehold Improvements at a specific Facility (the "Affected Improvements")
is damaged or destroyed by earthquake, flood, landslide, fire or other casualty,
Seller will promptly inform Buyer of such fact in writing and advise Buyer as to
the extent of the damage and whether it is, in Seller's reasonable opinion,
"MATERIAL."
(a) If Seller determines that such damage or destruction is "MATERIAL",
Buyer has the option to terminate its obligation to acquire such Facility (but
not the other Assets and Liabilities related thereto) (the "Damaged Facility")
upon written notice to the Seller given not later than ten (10) calendar days
after receipt of Seller's written notice to Buyer advising of such damage or
destruction.
(b) For purposes of this Section 4.10, "MATERIAL" shall mean any damage
or destruction to the Affected Improvements where the cost of repair or
replacement is estimated to be (i) in the case of damage or destruction to
Improvements, more than twenty-five (25) percent of the Market Value of the Real
Estate and Improvements, or (ii) in the case of damage or destruction to
Leasehold Improvements, more than twenty-five (25) percent of the amount
indicated in Section 3.1 and Schedule 3.1(b) for the Leasehold Improvements at
the Damaged Facility ("Leasehold Improvements Value"), and that in either case
will take more than sixty (60) calendar days to repair.
(c) If the obligation to acquire the Damaged Facility is so terminated,
neither party will have any further obligation to or rights against the other
with respect to such Damaged Facility except with respect to the other Assets
and Liabilities of such Facility and except any rights or obligations of either
party which are expressly stated to survive termination of this Agreement.
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(d) Subject to the Lease, if any, or other encumbrances, if any, if the
Buyer does not elect to terminate its obligation to acquire the Damaged
Facility, or if the casualty is not material, Seller shall either (i) reduce the
Market Value of the Real Estate or the Leasehold Improvements Value at the
Damaged Facility, as the case may be, by the value reasonably estimated by
Seller to repair or restore the damaged portion of the Affected Improvements,
less any sums expended by Seller to make emergency repairs to the Affected
Improvements, or (ii) repair or restore the damaged portion of the Affected
Improvements, and in either case this transaction will close pursuant to the
terms of this Agreement, and the Buyer will accept the Damaged Facility as is,
where is, without recourse, with all faults and with no warranties other than as
expressly provided in Section 5.1 of this Agreement, and subject to the
provisions of Section 4.4 of this Agreement, which shall exclusively govern the
rights and obligations of the parties with regard to Hazardous Substances.
(e) If the damage is not material, Seller's notice to Buyer of the
damage or destruction will also set forth the reduced Market Value of the Real
Estate or the reduced Leasehold Improvements Value at the Damaged Facility, as
the case may be, and Seller's allocation of value to the damaged portion of the
Affected Improvements. If Buyer does not accept Seller's reduced valuation,
Buyer's sole remedy will be to submit the issue to arbitration pursuant to
Section 9.4 hereof.
(f) Whether or not the sale of the Damaged Facility is consummated
hereunder, Buyer shall have no rights to insurance claims or proceeds in respect
of damage or destruction to the Affected Improvements occurring prior to the
Closing Date.
4.11 Real Estate.
(a) Seller, at its sole cost and expense, has previously caused to be
furnished to Buyer and the Title Company one (1) copy each of a survey meeting
the current Amended Standards for Land Surveyors in New Mexico as adopted by the
New Mexico State Board of Registration for Professional Engineers and Surveyors
(the "Survey") of the Real Estate prepared and certified as to all matters shown
thereon by a surveyor licensed by the State of New Mexico ("Surveyor").
(b) Prior to the date hereof, Seller has caused the Title Company to
furnish to Buyer (i) a title commitment ("Commitment"), showing Seller as the
record title owner of the Real Estate by the terms of which Title Company agrees
to issue to Buyer at Closing an owner's policy of title insurance providing for
standard coverage ("Title Policy") in the amount of the Market Value of the Real
Estate and Improvements on the standard form therefor promulgated by the New
Mexico Department of Insurance insuring Buyer's fee simple title to the Real
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Estate to be good and indefeasible subject to the terms of such policy and the
Schedule B exceptions; and (ii) a photocopy of all documents ("Title Documents")
describing all Schedule B title exceptions shown on the Commitment. Unless Buyer
has objected thereto prior to the date hereof, all matters shown on the Survey
and exceptions listed in the Commitment are conclusively deemed to be acceptable
to Buyer. Seller shall provide to Buyer the Title Policy, reflecting only the
Permitted Exceptions, as soon as practicable after the Closing Date. As used in
this Agreement, the term "Permitted Exceptions" shall mean all title exceptions
or Survey matters which would not materially impair the ability of the Buyer to
utilize the Real Estate as a banking facility, and all matters either shown on
the Survey or listed in the Commitment to which Buyer has not objected prior to
the date hereof, or, having objected, Buyer has thereafter waived. Seller and
Buyer shall share equally in the cost and expense of the Title Policy.
(c) Prior to the date hereof, Seller submitted appraisals of the Market
Value of the Real Estate and Improvements to Buyer.
(d) Upon consummation of the transactions contemplated by this
Agreement, Buyer shall register the Real Estate under the name of the Buyer for
ad valorem real estate tax purposes.
4.12 Certain Cash Management Relationships.
(a) With respect to those certain cash management relationships
(including cash management accounts and related lines of credit and loans) which
are set forth on Schedule 4.12, at the Closing Seller shall transfer and Buyer
shall acquire such cash management relationships, subject to Buyer's rights as
described in Section 4.12(b) to exclude certain of such relationships from the
transaction.
(b) Notwithstanding anything in this Agreement to the contrary, from
the date hereof until thirty (30) calendar days after the Closing Date, the
Buyer shall have the right to exclude from the transaction one or more of such
cash management relationships. The Buyer's right to exclude such cash management
relationship(s) shall be exercisable by the Buyer giving written notice to the
Seller at any time until and including the thirtieth (30th) calendar day after
the Closing Date. If, prior to the Closing, the Buyer does not exercise its
right to exclude any of the cash management relationship(s) described on
Schedule 4.12, such cash management relationships (including cash management
accounts and related lines of credit and loans) shall be transferred to the
Buyer at the Closing. If the Buyer exercises its right to exclude any of the
cash management relationship(s) described on Schedule 4.12, the entire cash
management relationship (including cash management accounts and related lines of
credit and loans) shall be retained by the Seller (if Buyer exercises its right
to exclude
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such cash management relationship(s) prior to Closing) or transferred to the
Seller (if Buyer exercises its right to exclude such cash management
relationship(s) during the thirty-day period following Closing). The Closing
Financial Statement or Final Financial Statement (as appropriate) shall be
adjusted to reflect any such cash management relationship(s) excluded from the
transaction by Buyer pursuant to this Section 4.12(b).
(c) Notwithstanding anything in this Agreement to the contrary, for a
period of three (3) years following the Closing Date, Seller will not conduct
or, following the closing of the BankAmerica/NationsBank Business Combination,
permit the New Mexico operations of NationsBank, N.A., to conduct, any
solicitation of the customers of the cash management relationships acquired and
retained by Buyer pursuant to this Section 4.12, except (i) in connection with
general solicitations or general advertising not targeted specifically at such
customers, or (ii) any solicitation of any such customer who, prior to the
closing of the BankAmerica/NationsBank Business Combination, had a pre-existing
customer relationship with NationsBank, N.A.
4.13 Additional Branches.
(a) As soon as practicable, but in no event later than 20 calendar days
following the date hereof, the Seller shall provide to the Buyer deposit, loan,
employee, facilities and related information (the "Additional Information")
regarding each of the Branches listed on Schedule A-1 designated as "Additional
Branches" (the "Additional Branches") in format and scope similar to information
delivered to the Buyer prior to the date hereof regarding the Branches other
than the Additional Branches.
(b) The Additional Information shall be deemed to be satisfactory and
accepted by the Buyer unless, within 20 calendar days of the receipt by the
Buyer of the Additional Information, the Buyer notifies the Seller in writing
that, based on its review of the Additional Information, the Buyer in good faith
believes that the Assets and Liabilities at the Additional Branches are not
substantially similar in type and character to the Assets and Liabilities
maintained at the Branches other than the Additional Branches. Within 10
calendar days of the receipt by the Seller of such notice, the Seller and the
Buyer shall confer in good faith on a commercially reasonable basis with a view
towards determining a mutually acceptable adjustment to the purchase price to be
paid pursuant to Section 3.1. In the event the Seller and the Buyer are unable
to agree on an acceptable adjustment to the purchase price within such 10 day
period, the matter shall be determined in accordance with Section 9.4.
(c) As soon as practicable following the delivery of the Additional
Information to the Buyer, Section 3.1 relating to the calculation of the Initial
Base Amount and Schedule 3.1(a) shall be revised to reflect the inclusion of the
Additional Branches.
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ARTICLE 55
Representations and Warranties
5.1 Seller's Representations and Warranties. The Seller represents and
warrants to the Buyer that, as of the date of this Agreement (or, as to any
information specified in a Schedule to have been compiled as of some earlier
date, as of such earlier date), and subject to Section 4.4(a):
(a) The Seller is a national banking association, duly organized and in
good standing under the laws of the United States;
(b) The Seller has the requisite power and authority to execute,
deliver and perform this Agreement and to consummate the transactions
contemplated hereby; all corporate action necessary to be taken by or on the
part of the Seller to execute, deliver and perform this Agreement and to
consummate the transactions contemplated hereby has been duly and validly taken;
and this Agreement has been duly executed and delivered by, and constitutes the
valid and binding agreement of the Seller, enforceable in accordance with its
terms except as limited by bankruptcy, insolvency, reorganization, fraudulent
transfer, moratorium and similar laws affecting creditors generally and by the
availability of equitable remedies;
(c) The execution, delivery and performance by the Seller of this
Agreement do not, and the consummation by the Seller of the transactions
contemplated hereby will not, violate or conflict with the articles of
association or bylaws of the Seller, or any law or regulation currently
applicable to the Seller, or any material agreement or instrument, or currently
applicable award, order, judgment or decree to which the Seller is a party or by
which it is bound, or require any filing by the Seller with, or authorization,
approval, consent or other action with respect to the Seller by, any
governmental or regulatory agency except such as have been made or obtained and
are in full force and effect or as identified in this Agreement;
(d) Schedule 2.2(e) sets forth a list of all material written
contracts, agreements and other obligations which relate specifically to the
operation of the Facilities (other than those giving rise to the Assets and the
Liabilities), including, without limitation, equipment leases and service and
maintenance contracts, consulting contracts, agency agreements and licensing
agreements; provided, however, that equipment leases and service and maintenance
contracts which the Seller does not believe are assignable and contracts that
relate to
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the Seller's general operations and that are not being assigned to the Buyer are
not listed;
(e) Except as set forth in Schedule 5.1(e): (i) there is no litigation,
claim, action, suit or proceeding pending which, if adversely determined, would
materially and adversely affect the use of the Assets or the Liabilities; and
(ii) to the Seller's knowledge, there is no litigation, claim, action, suit or
proceeding threatened by any organization, person, individual or governmental
agency which, if adversely determined, would, individually or in the aggregate,
materially and adversely affect the use of the Assets or the Liabilities;
(f) Except for its agreement with Bear, ▇▇▇▇▇▇▇ & Co., Inc., for which
the Seller is solely responsible, the Seller has not in any manner whatsoever
paid or agreed to pay any fee or commission to any agent, broker, finder or
other person for or on account of services rendered as a broker or finder in
connection with this Agreement or the transactions covered and contemplated
hereby. All negotiations relating to this Agreement have been conducted by the
Seller directly and without the intervention of any person in such manner as to
give rise to any valid claim against the Seller for any brokerage commission or
like payment;
(g) Schedule 2.2(f) contains an accurate and complete list of all
Leases, if any. True and correct copies of all Leases referred to in such
Schedule have been provided to Buyer; and
(h) Except as disclosed in Schedule 5.1(h), to the knowledge of Seller,
(i) each Loan, in all material respects, is a legal, valid and binding
obligation, in full force and effect and enforceable in accordance with its
terms, except as may be limited by bankruptcy, insolvency, moratorium,
receivership, conservatorship, reorganization or similar laws affecting the
rights of creditors generally or equitable principles limiting the right to
obtain specific performance or other similar relief; (ii) Seller has duly
performed in all material respects all of its obligations thereunder to the
extent that such obligations to perform have accrued; (iii) all documents and
agreements necessary for Seller to enforce each Loan are in existence; (iv) no
claims, counter-claims, set-off rights or other rights exist, nor do the grounds
for any such claim, counter-claim, set-off rights or other rights exist, with
respect to any such Loans which could impair the collectibility thereof; and (v)
each such Loan has been, in all material respects, originated and serviced in
accordance with Seller's then applicable underwriting guidelines, the terms of
the relevant credit documents and agreements and applicable law.
(i) The Furniture, Fixtures and Equipment, the Improvements and the
Leasehold Improvements have been and as of the Closing will have been installed,
maintained and operated in accordance with the customary standards of Seller.
The
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equipment owned by the Seller and located at the Facilities is currently
adequate for Seller's customary and ordinary operations. No expenditures for the
repair, maintenance or improvement of the Assets are currently, and as of the
Closing Date will be, necessary or budgeted by Seller other than normal
recurring expenses for routine maintenance and upkeep.
(j) The Assets (excluding the Real Estate which shall be subject to the
provisions of Section 4.11) are, and as of the Closing Date shall be, free and
clear of all Liens, except the Liabilities.
(k) Only in the event the parties elect to pursue the Stock Purchase
and only as of the Closing Date:
(i) Newco is a corporation duly organized, validly existing and in good
standing under the laws of its jurisdiction of incorporation;
(ii) The Seller owns all of the Shares, free and clear of any and all
Liens. All of the Shares are validly issued and outstanding, full paid and
nonassessable. Except for this Agreement, there are no understandings,
arrangements, restrictions, commitments or agreements of any kind relating to
the Shares or any securities outstanding representing the right to purchase or
otherwise receive shares of common stock or any other capital stock or equity
security of Newco. The stock certificates, endorsements and other documents
delivered to the Buyer at the Closing will transfer to and vest in the Buyer
good, valid and indefeasible title to the Shares, free and clear of any and all
Liens.
5.2 Buyer's Representations and Warranties. The Buyer represents and
warrants to the Seller that, as of the date of this Agreement, and subject to
Section 4.4(a):
(a) The Buyer is a national banking association, duly organized and in
good standing under the laws of the United States;
(b) Subject to the satisfaction of any applicable governmental or
regulatory requirements referred to in Section 4.2(b) and to approval of this
Agreement and the transactions contemplated hereby by the requisite vote or
consent of the holders of outstanding securities of the Buyer, if such approval
is required by applicable law, contract, the Buyer's articles of association or
bylaws, or otherwise, the Buyer has the requisite power and authority to
execute, deliver and perform this Agreement and to consummate the transactions
contemplated hereby; all acts and other proceedings required to be taken by or
on the part of the Buyer to execute, deliver and perform this Agreement and to
consummate the transactions contemplated hereby have been duly and validly
taken; and this Agreement has been duly executed and delivered by, and
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constitutes the valid and binding agreement of, the Buyer, enforceable in
accordance with its terms except as limited by bankruptcy, insolvency,
reorganization, fraudulent transfer, moratorium and similar laws affecting
creditors generally and by the availability of equitable remedies;
(c) Subject to the satisfaction of any applicable governmental or
regulatory requirements referred to in Section 4.2(b), the execution, delivery
and performance by the Buyer of this Agreement do not, and the consummation by
the Buyer of the transactions contemplated hereby will not, violate or conflict
with the articles of association or bylaws of the Buyer, or any law or
regulation currently applicable to the Buyer, or any material agreement or
instrument, or currently applicable order, judgment or decree to which the Buyer
is a party or by which it is bound or require any prior filing by the Buyer
with, or authorization, approval, consent or other action with respect to the
Buyer by, any governmental or regulatory agency except such as have been made or
obtained and are in full force and effect or will be made or obtained and are in
full force and effect as of the Closing;
(d) There are no actions, suits or proceedings pending or, to the
knowledge of the Buyer, threatened against or affecting, the Buyer, which may
cause a material adverse change in the Buyer's business or financial condition
or would prohibit consummation of the transactions contemplated hereunder;
(e) The Buyer has not paid or agreed to pay any fee or commission to
any agent, broker, finder or other person for or on account of services rendered
as a broker or finder in connection with this Agreement or the transactions
covered and contemplated hereby. All negotiations relating to this Agreement
have been conducted by the Buyer directly and without the intervention of any
person in such manner as to give rise to any valid claim against the Seller for
any brokerage commission or like payment;
(f) The Buyer has not received written notice from any federal or New
Mexico governmental or regulatory agency indicating that it would oppose or not
grant or issue its consent or approval, if required, with respect to the
transactions contemplated by this Agreement;
(g) The Buyer satisfies each and all of the standards and requirements
lawfully within the control of the Buyer of which it is aware (and, as of the
Closing Date, will satisfy each and all of the standards and requirements
lawfully within the control of the Buyer) imposed as a condition to obtaining,
or necessary to comply with and in order to obtain, any of the governmental or
regulatory approvals referred to in Section 4.2(b) of this Agreement;
(h) At the time of the most recent regulatory evaluation of Buyer's
performance under the Community Reinvestment Act
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(the "CRA"), Buyer's record of performance was deemed to be "outstanding" or
"satisfactory", and no proceedings are pending or, to the knowledge of Buyer,
threatened, that would result in a change in such evaluation. Except as
previously disclosed in writing to Seller, Buyer has not received any adverse
public comments with respect to its compliance under the CRA since the date of
its most recent regulatory evaluation of its performance under the CRA; and
(i) The Buyer has available sufficient cash or other liquid assets or
financing pursuant to binding agreements or commitments which may be used to
fund the transactions contemplated hereby and its ability to consummate such
transactions is not contingent on raising any equity capital, obtaining specific
financing therefor, consent of any lender or any other matter.
ARTICLE 66
Understandings
Buyer and Seller understand and agree as follows:
6.1 Depositors' Rights. All transfers to the Buyer of Assumed Deposits
are subject to the individual depositors' continuing rights to withdraw, and the
Seller makes no representation or warranty to the Buyer concerning the
continuing maintenance of such deposits at the Branches.
6.2 Unclaimed Property. With respect to safe deposit boxes that have
been opened by the Seller and whose contents have been inventoried and are being
held by the Seller in safekeeping in preparation for escheat to the State of New
Mexico, the Seller shall remove any and all such contents from the Branches
prior to the Closing Date.
6.3 Head Office Accounts. Schedule 6.3 sets forth certain Accounts at
the Branches and Offices which have been designated by the Seller as "Head
Office Accounts." The Buyer and the Seller understand and agree that the Seller
may remove from the Branches and Offices prior to the Closing Date any and all
Head Office Accounts and deposits of the types described in the proviso in
Section 2.3(a)(iii) and any Head Office Accounts and any such deposits so
removed shall not be included in the Assumed Deposits.
6.4 Limitation of Warranties. Except as may be expressly represented or
warranted by Seller in Section 5.1 of this Agreement, and subject to the
provisions of Section 4.4 of this Agreement which shall exclusively govern the
rights and obligations of the parties with regard to Hazardous Substances,
Seller makes no representation or warranty whatsoever with regard to any Asset,
any Liability (or the Shares in the case of the Stock
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Purchase) or the business or operation of any of the Facilities, it being
expressly understood that such Assets and Liabilities (and the Shares in the
case of the Stock Purchase) are being transferred AS IS, WHERE IS, WITHOUT
RECOURSE, WITH ALL FAULTS AND WITH NO WARRANTIES OTHER THAN AS EXPRESSLY
PROVIDED IN SECTION 5.1 OF THIS AGREEMENT. Buyer agrees that it is relying
solely upon its own judgment, after such investigation and inspection as it
deems necessary or appropriate, as to the quality, condition, fitness and value
of the Assets and the nature and amount of the Liabilities, and Seller hereby
disclaims any representations or warranties made by Seller as to their
condition, value, nature or amount except those made in Section 5.1 of this
Agreement, subject to Section 4.4 of this Agreement. Notwithstanding any other
provision of this Agreement, Buyer and Seller understand and agree that Seller
is making, and shall make, no representations or warranties with respect to
title to the Real Estate other than those, if any, contained in the special
warranty deed the form of which is attached hereto as Exhibit C.
ARTICLE 77
Conditions to the Closing
7.1 Seller's Conditions. The obligations of the Seller to consummate
the Closing shall be subject to the satisfaction at or prior to Closing of all
of the following conditions, any one or more of which may be waived, in whole or
in part, by the Seller:
(a) The Buyer shall have complied in all material respects with each of
its covenants and agreements contained herein to be performed at or prior to the
Closing Date, and each of the representations and warranties of the Buyer in
Section 5.2 hereof shall be true and correct in all material respects as if made
at and as of the Closing;
(b) The Buyer shall have delivered to the Seller a duly authorized and
signed officer's certificate, dated as of the Closing Date, certifying as to the
matters specified in Section 7.1(a), and further that (i) the methodology and
accounting procedures used by the Seller in preparing the Closing Financial
Statement have been reviewed and are acceptable to the Buyer, and (ii) the
Buyer, to and including the Closing Date, has performed such review of the
books, records, files, documentation and accounts of the Facilities as it has
deemed appropriate;
(c) All consents, approvals and authorizations required to be obtained
prior to the Closing from governmental and regulatory authorities in connection
with the execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby to be consummated at the Closing shall have
been made or obtained, and shall remain in full force and effect, all waiting
periods applicable to the
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consummation of the transactions contemplated hereby shall have expired or been
terminated and all required regulatory filings shall have been made; provided,
however, that no governmental or regulatory consent, approval or authorization
shall have imposed any condition or requirement that the Seller in good faith
determines to be materially burdensome upon the business of the Seller or upon
the consummation of the transactions contemplated hereby;
(d) There shall not be in effect any nonappealable final order, decree
or judgment of any court or governmental body having competent jurisdiction that
would be violated by consummation of the transactions contemplated hereby, nor
any material pending or threatened action, proceeding or investigation, the
adverse determination of which would result in such order, decree or judgment;
provided, that in the case of such material pending or threatened action,
proceeding or investigation, neither party shall decline to proceed with the
Closing pending final resolution thereof without exercising its reasonable
efforts promptly to determine jointly with the other party the merit thereof and
the likelihood of an adverse determination in such proceeding;
(e) This Agreement and the transactions contemplated hereby shall have
been approved by the requisite vote or consent of the holders of outstanding
securities of the Buyer if such approval is required by applicable law,
contract, the Buyer's articles of association or bylaws, or otherwise; and
(f) All necessary corporate approvals and the Merger Regulatory
Approvals shall have been obtained and Seller shall have determined that all
other conditions to the closing of the BankAmerica/NationsBank Business
Combination have been satisfied or waived. As used herein, (i) "Merger
Regulatory Approvals" shall mean all approvals, permits, authorizations, waivers
or consents of governmental agencies or authorities necessary or appropriate to
permit consummation of the BankAmerica/NationsBank Business Combination (such
Merger Regulatory Approvals shall not be deemed to have been obtained if any of
them shall contain any provisions or conditions which Seller, in the exercise of
its reasonable business judgment, deems to be unduly burdensome or restrictive);
and (ii) "BankAmerica/NationsBank Business Combination" shall mean that
transaction pursuant to which Agreement and Plan of Merger dated April 10, 1998,
BankAmerica Corporation shall merge with and into NationsBank Corporation.
7.2 Buyer's Conditions. The obligations of the Buyer to consummate the
Closing shall be subject to the satisfaction at or prior to Closing of all of
the following conditions, any one or more of which may be waived, in whole or in
part, by the Buyer:
(a) The Seller shall have complied in all material respects with each
of its covenants and agreements herein to be
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performed at or prior to the Closing Date and each of the representations and
warranties of the Seller contained in this Agreement and the Schedules shall be
true and correct in all material respects as if made at and as of Closing except
to the extent of changes that have occurred prior to Closing that are consistent
with the provisions of Section 2.3(a);
(b) The Seller shall have delivered to the Buyer a duly authorized and
signed officer's certificate, dated as of the Closing Date, certifying that (i)
the representations and warranties of the Seller contained in this Agreement and
the Schedules are true and correct in all material respects as if made at and as
of Closing except to the extent of changes that have occurred prior to Closing
that are consistent with the provisions of Section 2.3(a), and (ii) the Seller
has complied in all material respects with each of its covenants and agreements
herein to be performed at or prior to the Closing Date;
(c) As to each of the Facilities, there shall have been given, obtained
or satisfied in final form any notice, approval, permit or other requirement of
law or any competent governmental or regulatory authority that is necessary to
proceed with the Closing, including, without limitation, such approvals as may
be required of any New Mexico or federal bank or other financial institution
regulatory agency and any other entity or entities having jurisdiction over the
Facilities, the Buyer or the Seller, and no such agency or entity shall, in
connection therewith, have imposed any condition or requirement that would
result in a material adverse effect on the business or prospects of the
Facilities or the Buyer, or on the consummation of the transactions contemplated
hereby; and
(d) There shall not be in effect any nonappealable final order, decree
or judgment of any court or governmental body having competent jurisdiction that
would be violated by consummation of the transactions contemplated hereby, nor
any pending or threatened action, proceeding or investigation, the adverse
determination of which would result in such order, decree or judgment; provided,
that in the case of such pending or threatened action, proceeding or
investigation, neither party shall decline to proceed with the Closing pending
final resolution thereof without exercising its reasonable efforts promptly to
determine jointly with the other party the merit thereof and the likelihood of
an adverse determination in such proceeding.
Notwithstanding any other provision of this Agreement, in the event
that, at the Closing, there shall be a failure of any condition specified in
this Section 7.2 or elsewhere in this Agreement, including, without limitation,
any failure of condition specified in Section 2.2(e), 2.2(f), 4.3, 4.4, 4.9 or
4.10 to the obligations of the Buyer in respect of the acquisition of any
specific Facility or Facilities, the Buyer nevertheless shall be obligated to
consummate the transactions
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contemplated by this Agreement upon the Closing Date, and the Seller may, upon
written notice to the Buyer, exclude from the Closing the Facility or Facilities
(but not the other Assets and Liabilities related thereto) in respect of which
the failure of condition shall exist, in which case, appropriate adjustment
shall be made in the consideration payable pursuant to Article 3, the Schedules
hereto, the Financial Statements and the other documents to be delivered
pursuant hereto so as to duly reflect the deletion of such Facility or
Facilities (but not the other Assets and Liabilities related thereto) from the
Closing.
ARTICLE 88
Termination
8.1 Events of Termination. This Agreement may be terminated at any time
prior to Closing:
(a) By the mutual written agreement of the Seller and the Buyer;
(b) By the Seller or by the Buyer in the event that the Closing has not
occurred on or before the date indicated in the third proviso in Section
2.2(a), or such other date as the Seller and the Buyer shall agree in writing,
unless the failure to so consummate by such time is due to a breach of this
Agreement by the party seeking to terminate;
(c) By the Seller or by the Buyer if consummation of the transactions
contemplated hereby would violate any nonappealable final order, decree or
judgment of any court or governmental body having competent jurisdiction;
(d) By the Seller or the Buyer, in the event of a material breach by
the other of any representation, warranty or agreement contained herein which
is not cured or cannot be cured within thirty (30) calendar days after written
notice of such termination has been delivered to the breaching party; provided,
however, that (i) termination pursuant to this Section 8.1(d) shall not relieve
the breaching party of liability for such breach or otherwise and (ii) this
Section 8.1(d) shall not under any circumstances provide the Buyer with a basis
for termination due to any actual or alleged breach relating to Hazardous
Substances, Buyer's sole remedies with respect to Hazardous Substances being
contained in Section 4.4; and
(e) By the Seller in the event that:
(i) at the expiration of thirty (30) calendar days after the
date of this Agreement, the Buyer has failed to file substantially
complete applications requesting approval of the transactions
contemplated by this Agreement with all applicable regulatory agencies
("Buyer's Regulatory Agencies"); or
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(ii) at the expiration of sixty (60) calendar days after the
date of this Agreement, any of the Buyer's Regulatory Agencies has
failed to accept the Buyer's application pending before such agency as
informationally complete; or
(iii) at the expiration of one hundred fifty (150) calendar
days after the date of this Agreement, any of the Buyer's Regulatory
Agencies has failed to issue formal approval of the Buyer's
application; or
(iv) at any time, the Buyer's application has been disapproved
by any of the Buyer's Regulatory Agencies.
Any party desiring to terminate this Agreement pursuant to any of the
foregoing clauses shall give written notice of such termination to the other
party.
8.2 Liability for Termination8.2 Liability for Termination. If this
Agreement is terminated as permitted by Section 8.1, except as provided in
Section 8.1(d) or (e), such termination shall be without liability of either
party (or any shareholder, director, officer, employee, agent, consultant or
representative of such party) to the other party to this Agreement, except that,
subject to Section 4.4, if such termination shall result from the willful
failure of a party to fulfill a condition to the performance of the obligations
of the other party or to perform a covenant of this Agreement or from a willful
misrepresentation or breach of a warranty, covenant or agreement hereunder by
either party to this Agreement, such party shall be fully liable for any and all
damages, costs and expenses (including, but not limited to, reasonable
attorney's fees) sustained or incurred by the other party as a result of such
failure or breach.
8.3 Procedures Upon Termination8.3 Procedures Upon Termination. In the
event of termination pursuant to the terms of this Agreement, and except as
otherwise stated herein, written notice thereof shall be given to the other
party, and this Agreement shall terminate immediately upon receipt of such
notice unless an extension is consented to by the party having the right to
terminate. If this Agreement is terminated as provided herein,
(a) Each party will return all documents, work papers and other
materials of the other party, including photocopies or other duplications
thereof, relating to this transaction, whether obtained before or after the
execution hereof, to the party furnishing the same; and
(b) All information received by either party thereto with respect to
the business of the other party (other than information that is a matter of
public knowledge or that has
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heretofore been published in any publication for public distribution or filed as
public information with any governmental authority) shall not at any time be
used for any business purpose by such party or disclosed by such party to third
persons.
ARTICLE 99
Survival, Indemnification
9.1 Survival. The covenants, agreements, representations and warranties
of the parties hereto made, contained in or to be performed pursuant to this
Agreement, the Schedules or Exhibits hereto or the officers' certificates
delivered pursuant hereto or in connection herewith shall survive Closing and
remain operative and in full force and effect until the first anniversary of the
Closing Date, except for the provisions of Sections 2.4, 3.2(i), 4.1(j),
4.4(e)(ii), 4.12, 10.1 and 11.11, which shall survive such first anniversary.
Notwithstanding the preceding sentence, any covenant, agreement, representation,
warranty or claim in respect of which indemnity may be sought under Sections 9.2
or 9.3 shall survive the time at which it would otherwise terminate pursuant to
the preceding sentence if notice of the claim, inaccuracy or breach giving rise
to such right to indemnity shall have been given to the party against whom such
indemnity may be sought prior to such time. After Closing, the sole and
exclusive remedy of the Buyer and the Seller for any breach of any covenant or
agreement or any inaccuracy of any such representation or warranty by the Seller
or the Buyer shall be the indemnities contained in Sections 9.2 and 9.3,
respectively, which shall survive Closing; provided, however, that the
provisions of Section 4.4 shall exclusively govern the rights and obligations of
the Seller and Buyer with regard to Hazardous Substances.
9.2 Seller's Indemnity. Subject to the proviso in the final sentence of
Section 9.1, the Seller hereby indemnifies the Buyer against and agrees to hold
it harmless from any and all damage, loss, liability and expense (including,
without limitation, reasonable expenses of investigation and attorney's fees and
expenses in connection with any action, suit or proceeding brought against the
Buyer) demanded, claimed or threatened in writing against the Buyer or incurred
or suffered by the Buyer arising out of (i) any action taken or omitted to be
taken by the Seller prior to the Closing relating to the ownership or operation
of the Facilities or their business and properties prior to Closing, but
excluding all Liabilities and any damage, loss, liability or expense resulting
from actions taken by the Seller at the written direction of the Buyer or
resulting from defects in title to the Real Estate; (ii) any misrepresentation
or breach of warranty, covenant or agreement made, contained in or to be
performed by the Seller pursuant to this Agreement, the Schedules or Exhibits
hereto or the Seller's officer's
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certificate; (iii) all Non-Assumed Liabilities; and (iv) any claim or demand by
any Branch or Office employee of the Seller who shall not become an employee of
the Buyer (except as may be the result of any action or inaction of the Buyer).
Any direct claim by the Buyer against the Seller, as distinguished from a claim
against the Buyer by a third party, shall be settled by arbitration pursuant to
Section 9.4. The Seller shall not be liable under this Section 9.2 for any
settlement effected without its consent (which consent shall not be unreasonably
withheld) of any claim, litigation or proceeding in respect of which indemnity
may be sought hereunder. The Buyer agrees to give prompt notice to the Seller of
the assertion of any claim, or the commencement of any suit, action or
proceeding in respect of which indemnity may be sought hereunder. The Seller
may, and at the request of the Buyer shall, participate in and control the
defense of any such suit, action or proceeding at its own expense.
9.3 Buyer's Indemnity. Subject to the proviso in the final sentence of
Section 9.1, the Buyer hereby indemnifies the Seller against and agrees to hold
it harmless from any and all damage, loss, liability and expense (including,
without limitation, reasonable expenses of investigation and attorney's fees and
expenses in connection with any action, suit or proceeding brought against the
Seller) demanded, claimed or threatened in writing against the Seller or
incurred or suffered by the Seller arising out of (i) ownership or operation of
the Facilities or their business and properties on and after Closing (except as
to such damage, liability, loss or expense resulting from actions taken by the
Buyer at the written direction of the Seller); (ii) any misrepresentation or
breach of warranty, covenant or agreement made, contained in or to be performed
by the Buyer pursuant to this Agreement, the Schedules or Exhibits hereto or the
Buyer's officer's certificate; and (iii) all Liabilities (which term excludes
Non-Assumed Liabilities). Any direct claim by the Seller against the Buyer, as
distinguished from a claim against the Seller by a third party, shall be settled
by arbitration pursuant to Section 9.4. The Buyer shall not be liable under this
Section 9.3 for any settlement effected without its consent (which consent shall
not be unreasonably withheld) of any claim, litigation or proceeding in respect
of which indemnity may be sought hereunder. The Seller agrees to give prompt
notice to the Buyer of the assertion of any claim, or the commencement of any
suit, action or proceeding in respect of which indemnity may be sought
hereunder. The Buyer may, and at the request of the Seller shall, participate in
and control the defense of any such suit, action or proceeding at its own
expense.
9.4 Arbitration of Disputes. (a) ANY CONTROVERSY OR CLAIM ARISING OUT
OF OR RELATING TO THIS AGREEMENT OR ANY AGREEMENTS OR INSTRUMENTS RELATING
HERETO OR DELIVERED IN CONNECTION HEREWITH, INCLUDING, BUT NOT LIMITED TO A
CLAIM BASED ON OR ARISING FROM AN ALLEGED TORT, WILL, AT
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THE REQUEST OF ANY PARTY, BE DETERMINED BY ARBITRATION IN ACCORDANCE WITH THE
FEDERAL ARBITRATION ACT (9 U.S.C. SECTION 1 ET SEQ.) UNDER THE AUSPICES AND
RULES OF THE AMERICAN ARBITRATION ASSOCIATION ("AAA"). THE AAA WILL BE
INSTRUCTED BY EITHER OR BOTH PARTIES TO PREPARE A LIST OF THREE PROPOSED
ARBITRATORS. WITHIN TEN (10) CALENDAR DAYS OF RECEIPT OF THE LIST, EACH PARTY
MAY STRIKE ONE (1) NAME FROM THE LIST. THE AAA WILL THEN APPOINT THE ARBITRATOR
FROM THE NAME(S) REMAINING ON THE LIST. THE ARBITRATION WILL BE CONDUCTED IN
ALBUQUERQUE, NEW MEXICO. ANY CONTROVERSY IN INTERPRETATION OR ENFORCEMENT OF
THIS PROVISION OR WHETHER A DISPUTE IS ARBITRABLE, WILL BE DETERMINED BY THE
ARBITRATOR. JUDGMENT UPON THE AWARD RENDERED BY THE ARBITRATOR MAY BE ENTERED IN
ANY COURT HAVING JURISDICTION. THE INSTITUTION AND MAINTENANCE OF AN ACTION FOR
JUDICIAL RELIEF OR IN PURSUIT OF AN ANCILLARY REMEDY DOES NOT CONSTITUTE A
WAIVER OF THE RIGHT OF ANY PARTY, INCLUDING THE PLAINTIFF, TO SUBMIT THE
CONTROVERSY OR CLAIM TO ARBITRATION.
(b) IN ANY ARBITRATION PROCEEDING, THE ARBITRATOR IS AUTHORIZED TO
APPORTION COSTS AND EXPENSES, INCLUDING INVESTIGATION, LEGAL AND OTHER EXPENSES,
WHICH WILL INCLUDE, IF APPLICABLE, A REASONABLE ESTIMATE OF ALLOCATED COSTS AND
EXPENSES OF IN-HOUSE LEGAL COUNSEL AND LEGAL STAFF. SUCH COSTS AND EXPENSES ARE
TO BE AWARDED ONLY AFTER THE CONCLUSION OF THE ARBITRATION AND WILL NOT BE
ADVANCED DURING THE COURSE OF SUCH ARBITRATION.
9.5 Limit on Indemnities.
(a) Notwithstanding any other provision hereof, an indemnifying party
shall not be liable under this Article 9 or Exhibit H for any losses sustained
by the indemnified party with respect to a Facility unless and until the
aggregate amount of all such losses sustained by the indemnified party with
respect to that Facility (including any amount for which the indemnifying party
may become liable to provide indemnification pursuant to Section 4.4), shall
exceed $30,000, in which event the indemnifying party shall be liable only for
such losses in excess of $30,000 (it being the intention of the parties that
losses sustained by a party with respect to one Facility shall not be combined
with losses sustained with respect to another Facility to satisfy such minimum
$30,000 amount). The minimum $30,000 amount shall not apply to amounts which one
party may be required to pay to the other under Sections 2.4, 3.2, 4.1(g),
4.1(h), 4.6 and 10.1 of this Agreement or other provisions dealing with
customary and foreseeable post-closing adjustments. In no event shall the
aggregate losses for which the Seller may be liable under this Article 9 or
Section 4.4 or any other basis exceed the amount of $5,000,000. IN ADDITION, THE
INDEMNIFYING PARTY SHALL HAVE NO OBLIGATIONS UNDER THIS AGREEMENT FOR ANY
CONSEQUENTIAL LIABILITY, DAMAGE OR LOSS OF THE INDEMNIFIED PARTY THAT THE
INDEMNIFIED PARTY MAY SUFFER.
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(b) Each party's right to indemnification under this Article 9 shall
preclude any other monetary award (whether at law or in equity) and shall
preclude assertion by such party of any right to any such monetary award from
the indemnifying party.
9.6 Indemnities. Notwithstanding the foregoing, to the extent, if at
all, Section 56-7-1 of NMSA is applicable to this Agreement, the indemnity
provided in this Article 9 will not extend to liability, claims, damages, losses
or expenses, including fees of attorneys, relating to the construction,
installation, alteration, modification, repair, maintenance, servicing,
demolition, excavation, drilling, reworking, grading, paving, clearing, site
preparation or development of any real property or any improvement of any kind
on, above or under real property and arising out of (a) the preparation or
approval of maps, drawings, opinions, reports, surveys, change orders, designs
or specifications by the indemnitee, or the agents or employees of the
indemnitee, or (b) the giving of or the failure to give directions or
instructions by the indemnitee, or the agents or employees of the indemnitee,
where the giving or failure to give directions or instructions is the primary
cause of bodily injury to persons or damage to property.
ARTICLE 1010
Taxes
10.1 Obligations of the Buyer. The Buyer shall pay to the Taxation and
Revenue Department or to Seller, as determined by Seller, and shall indemnify
the Seller for, any gross receipts and compensating tax, any sales tax, use tax,
deed tax or property transfer tax imposed on the sale or transfer of, or
receipts of Seller from the sale or transfer of, the Assets or the Liabilities
or any part thereof.
10.2 Access to Information. For the applicable period required by law,
the Seller and the Buyer shall have a right to have access to and to copy all of
the records of the other party relevant to the Assets and the Liabilities and
necessary for the preparation of income tax returns, employee tax returns,
employee reports, employee benefits calculations, and for customary accounting
functions and other similar bona fide purposes. Additionally, the Buyer and the
Seller each agree to make available to the other party, at reasonable times and
upon reasonable advance notice, relevant records and personnel in connection
with an investigation or the preparation of or participation in a defense,
negotiation or settlement relating to any pending, future, or threatened
litigation or government agency proceeding (including a tax audit) involving the
conduct or interest of such other party.
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10.3 Allocation of Consideration. The Buyer and the Seller shall use
reasonable efforts to allocate the consideration payable hereunder at the
Closing among the Assets, tangible and intangible, on the basis of an allocation
(the "Allocation") to be determined by Buyer and Seller as soon as practicable
following the date hereof in the manner set forth on Schedule 10.3.
ARTICLE 1111
Miscellaneous
11.1 Public Notice. All written notices to third parties, including
customers of the Branches and borrowers under the Loans (but excluding requests
for consent or approval of regulatory agencies, contractors and similar third
parties), all oral or written notices or general communications to employees of
the Facilities, and all public announcements and press releases concerning the
transactions contemplated by this Agreement made prior to Closing shall be
jointly planned and coordinated by the Buyer and the Seller. Neither party shall
act unilaterally in this regard without the prior approval of the other party,
which approval shall not be unreasonably withheld or delayed; provided, however,
that in the event that a party reasonably concludes that a public announcement
or release is required by applicable law and the parties cannot reach agreement
upon a mutually acceptable release, the party releasing the information,
announcement or public statement shall not be deemed to be in breach of this
Agreement.
11.2 Assignment. Neither party shall assign this Agreement or any of
its rights, duties or obligations hereunder without the prior written consent of
the other party, provided that the Seller may assign this Agreement, whether by
merger or other agreement, to an Affiliate; and provided, further, that Buyer
may assign its rights and obligations as contemplated in the sixth Recital to
this Agreement, it being understood that such assignment shall not release Buyer
from any liability to Seller hereunder.
11.3 Notices. Notices and legal process to be delivered to or served
upon either party hereto shall be deemed to have been duly delivered or served
when delivered in written form by hand or by telegraph, telex or facsimile
transmission, or the day after being sent from within the continental United
States by overnight delivery or courier service, or three (3) calendar days
after posting by registered mail or certified mail with return receipt
requested, to the parties hereto at the following addresses:
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If to the Seller:
c/o BankAmerica Corporation
Corporate Strategy and Development Department #13262
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Director of Corporate Strategy and
Development
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
With copies to:
Bank of America NT&SA
Legal Department #6399
▇▇▇ ▇. ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇, Legal Department
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
And to:
Pillsbury Madison & Sutro LLP
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Buyer:
BOK Financial Corporation
Bank of Oklahoma Tower
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Senior Vice President,
Mergers & Acquisitions
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
With copies to:
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Lawyers
Old City Hall
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Esq.
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
or to such other authorized agent or address as either party may hereafter
select by written notice to the other party.
11.4 Time. Time shall be of the essence for all purposes connected with
this Agreement.
11.5 Expenses. Except as otherwise expressly provided herein, the Buyer
and the Seller shall each
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bear its own out-of-pocket expenses incurred in connection with the transactions
contemplated by this Agreement.
11.6 Misdirected Payments or Communications. If for any reason any
payment or communication to which one party is entitled is received by the other
party hereto, the receiving party shall at its own expense forward such payment
or communication to the other party as soon as practicable, but in no event
later than three (3) Business Days, after receipt thereof.
11.7 Entire Agreement. This Agreement embodies the entire agreement and
understanding between the parties hereto and supersedes all prior agreements and
understandings, except that certain Confidentiality Agreement between the
parties hereto which was executed by the Seller as of June 2, 1998 (the
"Confidentiality Agreement"), relating to the subject matter of this Agreement.
The Confidentiality Agreement shall survive, in accordance with its own terms,
the execution, delivery and performance of this Agreement.
11.8 Amendment. Neither this Agreement nor any provision hereof may be
changed, waived, discharged or terminated orally. Any such change, waiver,
discharge or termination may be effected only by an instrument in writing signed
by the party against which enforcement of such change, waiver, discharge or
termination is sought.
11.9 Governing Law, Severability. This Agreement shall be governed by
and construed in accordance with the laws of the State of California. If any one
or more of the provisions of this Agreement shall for any reason be held to be
invalid, illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provision of this Agreement, and
this Agreement shall be construed as if such invalid, illegal or unenforceable
provision were not contained herein.
11.10 Waiver. No delay or omission to exercise any right, power or
remedy accruing to either party upon any breach or default under this Agreement
shall impair any such right, power or remedy of such party, nor shall it be
construed to be a waiver of any such breach or default, or an acquiescence
therein, or in any similar breach or default thereafter occurring; nor shall any
waiver of any single breach or default be deemed a waiver of any other breach of
default theretofore or thereafter occurring. Any waiver, permit, consent or
approval or any kind or character of any breach or default under this Agreement,
or any waiver of any provision or condition of this Agreement, must be in
writing and shall be effective only to the extent specifically set forth in such
writing. All rights and remedies, either under this Agreement or by law or
otherwise afforded to a party, shall be cumulative and not alternative.
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11.11 Confidentiality. The Buyer and its representatives, agents and
designees shall keep confidential and shall not disclose to any person or
entity, without Seller's prior written consent: the amount of the Purchase
Premium, the fact that confidential information has been made available to
Buyer, the existence of this Agreement or any of the terms or conditions hereof,
the status of the transactions contemplated hereby, all information concerning
the books, records, accounts and documents of Seller to which it has access
under this Agreement and any information developed in connection with any
Environmental Assessments that are performed by or on behalf of the Buyer
(including, without limitation, any reports or sampling results and analysis).
These restrictions, however, shall not apply to any such information (i) that
becomes public knowledge through no fault, act or omission of Buyer or its
representatives, agents or designees (for purposes of this Section 11.11,
collectively, the "Buyer"), (ii) that Buyer lawfully acquires from an entity not
under an obligation of confidentiality to Seller, (iii) that is independently
developed by Buyer, or (iv) where the Buyer is legally compelled to disclose
such information, provided that the Seller is provided with advance written
notice of the intention of Buyer to disclose to allow the Seller to contest the
proposed disclosure before any court or agency with jurisdiction unless such
notice impedes a duty or obligation of the Buyer under applicable laws,
regulations or legal requirements to timely report such information, in which
event Buyer shall concurrently advise Seller of Buyer's disclosure. In case of
any actual or purported inconsistency or conflict between the provisions of this
Agreement and the provisions of the Confidentiality Agreement with respect to
obligations of the Buyer to maintain confidentiality as to any information, the
provisions which impose a higher standard of confidentiality on the Buyer with
respect to such information shall control and govern as to such actual or
purported inconsistency or conflict.
11.12 Third Party Rights. Other than the provisions of Section 2.4,
nothing contained in this Agreement, whether express or implied, is intended to
(i) confer any rights or remedies upon any persons other than the parties hereto
and their respective successors and assigns, (ii) relieve or discharge the
obligations or liabilities of any third person to either party to this
Agreement, or (iii) give any third person any right of subrogation or action
over either party to this Agreement.
11.13 Headings. The headings and captions used herein and in the
Schedules and Exhibits are included for purposes of convenience of reference
only and shall not limit or define the meaning of any provisions of this
Agreement.
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11.14 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original instrument, but
all of which together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized officers or representatives as of the date
first above written.
SELLER:
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------------
Name ▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------------------
Its Vice President
------------------------------------
BUYER:
BOK FINANCIAL CORPORATION
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------------
Name ▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------------------
Its EVP, CFO
------------------------------------
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69
AMENDMENT NO. 1 TO
PURCHASE AND ASSUMPTION AGREEMENT
AMENDMENT NO. 1 TO PURCHASE AND ASSUMPTION AGREEMENT, dated as of
December 1, 1998 (this "Amendment"), between BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION, a national banking association established under the laws
of the United States (the "Seller"), and BOK FINANCIAL CORPORATION, an Oklahoma
corporation and a bank holding company under the Bank Holding Company Act of
1956, as amended (the "Buyer").
RECITALS
WHEREAS, the Seller and the Buyer are parties to a Purchase and
Assumption Agreement dated as of July 27, 1998 ("Original Agreement");
WHEREAS, pursuant to that certain Assignment dated November 13, 1998 (a
copy of which is attached hereto as Exhibit A) ("Assignment") Buyer has assigned
its interest in the Original Agreement to Bank of Albuquerque, National
Association, a national banking association in formation and a wholly-owned
subsidiary of Buyer ("Bank of Albuquerque");
WHEREAS, as a result of subsequent discussions, the parties now intend
to modify certain terms of the Original Agreement.
NOW, THEREFORE, in consideration of their mutual promises and
obligations and intending to be legally bound hereby, the parties agree as
follows:
ARTICLE 1
Certain Definitions
1.1 Certain Definitions.
(a) Capitalized terms used herein without definition shall have the
meanings specified in the Original Agreement.
(b) As used in this Amendment and the Original Agreement, "Agreement"
shall mean the Original Agreement, as amended hereby.
70
ARTICLE 2
Amendment of the Original Agreement
2.1 Schedule A-1. Schedule A-1 to the Agreement shall be restated in
its entirety to read as set forth on Schedule A-1 hereto.
2.2 Schedule A-2. Schedule A-2 to the Agreement shall be restated in
its entirety to read as set forth on Schedule A-2 hereto.
2.3 Schedule A-3. Schedule A-3 to the Agreement shall be restated in
its entirety to read as set forth on Schedule A-3 hereto.
2.4 Schedule 1.1(b). Schedule 1.1(b) to the Agreement shall be amended
to add the Furniture, Fixtures and Equipment set forth on Schedule 1.1(b)
hereto.
2.5 Schedule 1.1(d). Schedule 1.1(d) to the Agreement shall be amended
to add the Preliminary Title Report set forth on Schedule 1.1(d) hereto.
2.6 Section 1.1. (a) The definition of "Closing Financial Statement"
set forth in Section 1.1 to the Agreement shall be restated in its entirety to
read as follows:
"'Closing Financial Statement' means the balance sheet of the
Facilities prepared by the Seller as of the close of business at the
Facilities on the ninth (9th) Business Day prior to the Closing Date
and on which are recorded as of such date, in accordance with the
Seller's normal practices and procedures, the Assets and the
Liabilities (except that such normal practices and procedures shall be
modified as necessary to implement prorations required by, or other
provisions of, this Agreement)."
(b) The definition of "Loan Cut-off Date" set forth in Section 1.1 to
the Agreement shall be restated in its entirety to read as follows:
"'Loan Cut-off Date' shall mean October 31, 1998."
2.7 Schedule 2.2(f). Schedule 2.2(f) to the Agreement shall be restated
in its entirety to read as set forth on Schedule 2.2(f) hereto.
2.8 Section 2.4. Section 2.4(e) of the Agreement shall be restated in
its entirety to read as follows:
"(e) Seller shall be responsible for timely payment to Employees as
required by law of all wages, salaries,
71
bonuses, if any, and other compensation with respect to service
completed on or prior to the Closing Date. Seller shall pay each
Employee an amount equal to the total days of vacation that Employee
was eligible to earn under Seller's vacation policy for the entire
calendar year in which the Closing occurs, less the number of vacation
days or fractions thereof that Employee has used as of the Closing
Date. Buyer shall pay Seller an amount equal to the prorated vacation
days or fractions thereof that each Employee would have been eligible
to accrue under Seller's vacation policy between the Closing Date and
the end of the calendar year in which the Closing occurs (regardless of
how many vacation days the Employee has actually used as of the
Closing, or whether the Employee remains employed with Buyer through
the end of the calendar year). Buyer shall allow Employees to take
unpaid leave through the remainder of the calendar year in which the
Closing Date occurs equal to the total days of vacation that Employee
was eligible to earn under Seller's vacation policy for the entire
calendar year in which the Closing occurs, less the number of vacation
days or fractions thereof that Employee has used as of the Closing
Date. For purposes of this Section, personal choice days or fractions
thereof will be treated as vacation days. In subsequent calendar years,
Employees will be eligible to earn vacation according to the schedule
specified in Buyer's policy."
Section 2.4(f) of the Agreement shall be restated in its entirety to
read as follows:
"(f) Through the end of the month in which the Closing Date occurs,
medical, dental, vision, life and accidental death and dismemberment
insurance claims incurred by Employees shall be determined under
Seller's benefit plans. All medical, dental, vision, life and
accidental death and dismemberment insurance claims incurred by
Employees who are in Buyer's employ on the day after the Closing Date
shall be determined under Buyer's benefit plans beginning on the first
of the month that begins after the Closing Date occurs. Beginning the
day after the Closing Date occurs, all disability claims incurred by
Employees who are in Buyer's employ on the day after the Closing Date
shall be determined under Buyer's benefit plans. Buyer agrees that
Employees and their eligible dependents will receive credit for their
periods of coverage under Seller's health or disability plans toward
satisfying any preexisting condition clause in any of Buyer's health or
disability plans, provided such Employee or eligible dependent is
enrolled in Seller's plans on the Closing Date. Buyer also agrees that
Employees and their eligible dependents shall receive credit under
Buyer's health care plans for any deductibles paid by such Employee and
enrolled dependents for the current plan year under a health care plan
maintained by Seller."
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2.9 Section 2.5(d)(ii). Section 2.5(d)(ii) of the Agreement shall be
amended to replace the references therein to "tenth (10th) calendar day" and
"ten (10) calendar" with "ninth (9th) calendar day" and "nine (9) calendar",
respectively.
2.10 Section 3.1. Section 3.1 of the Agreement shall be restated in its
entirety to read as follows:
"3.1 Price. The Seller agrees that in the event the Initial
Base Amount (as hereinafter defined) is less than the sum of (i) the
amount of the Assumed Deposits and (ii) the amount of the Accrued
Expenses, the Seller shall transfer to the Buyer cash in the amount
equal to the deficit. The Buyer agrees that in the event the Initial
Base Amount is greater than the sum of (i) the amount of the Assumed
Deposits and (ii) the amount of the Accrued Expenses, the Buyer shall
transfer to the Seller cash in an amount equal to such excess.
Calculations and payments pursuant to this Section 3.1 shall be as of
the date and time of the Closing Financial Statement. The "Initial Base
Amount" shall be equal to the sum of (i) the amount of Cash on Hand,
(ii) the Market Value of $8,325,000.00 for the Real Estate and the
Improvements (which amount is allocated among the Facilities as listed
on Schedule 3.1(a)), (iii) the amount of $1,452,091.30 for the
Leasehold Improvements (which amount, if any, is allocated among the
Facilities as listed on Schedule 3.1(b)), (iv) the Market Value of
$1,428,265.00 for the Furniture, Fixtures and Equipment (which amount
is allocated as listed on Schedule 1.1(b)), (v) the amount of Prepaid
Expenses, (vi) the amount of the Overdrafts, (vii) the amount of any
fees, charges or accrued interest receivable on such Overdrafts, (viii)
the unpaid principal amount of the Loans and the amount of accrued
interest receivable on all such Loans, net of loan loss reserve, and
(ix) the amount of the Purchase Premium."
2.11 Schedule 3.1(a). Schedule 3.1(a) to the Agreement shall be
restated in its entirety to read as set forth on Schedule 3.1(a) hereto.
2.12 Schedule 3.1(b). Schedule 3.1(b) to the Agreement shall be
restated in its entirety to read as set forth on Schedule 3.1(b) hereto.
2.13 Section 3.2(j). The second to last sentence in Section 3.2(j) of
the Agreement shall be restated in its entirety to read as follows:
73
"Upon the expiration of such ninety (90) calendar day period, the
Seller shall cease forwarding drafts against Transaction Accounts
transferred on the Closing Date and shall instead return them to the
originators marked 'Refer to Maker-Branch Sold'; provided, however,
that, notwithstanding the foregoing, from and after April 8, 1999, such
drafts shall be returned, but the stamped wording may change."
2.14 Section 4.4(b). The second sentence of Section 4.4(b) of the
Agreement shall be restated in its entirety to read as follows:
"In addition, Seller has delivered to the Buyer an Asbestos Survey for
each of the Northtowne, Rio Bravo, Ladera and Uptown Branches."
2.15 Schedule 4.4(b). Schedule 4.4(b) to the Agreement shall be
restated in its entirety to read as set forth on Schedule 4.4(b) hereto.
2.16 Section 5.2. Section 5.2 of the Agreement shall be restated in its
entirety to read as follows:
"Representations and Warranties of Buyer and Bank of Albuquerque. The
Buyer represents and warrants to the Seller that, as of the date of
this Agreement, and Bank of Albuquerque represents and warrants to
Seller that, as of the Closing Date, in each case subject to Section
4.4(a):
(a) The Buyer is a corporation duly organized and in good standing
under the laws of the State of Oklahoma and is a bank holding company
under the Bank Holding Company Act of 1956, as amended;
(b) Bank of Albuquerque is a national banking association, duly
organized and in good standing under the laws of the United States;
(c) Subject to the satisfaction of any applicable governmental or
regulatory requirements referred to in Section 4.2(b) and to approval
of this Agreement and the transactions contemplated hereby by the
requisite vote or consent of the holders of outstanding securities of
each of the Buyer and Bank of Albuquerque, if such approval is required
by applicable law, contract, their respective articles of incorporation
or association or bylaws, or otherwise, each of the Buyer and Bank of
Albuquerque has the requisite power and authority to execute, deliver
and perform this Agreement and to consummate the transactions
contemplated hereby; all acts and other proceedings required to be
taken by or on the part of the Buyer and Bank of Albuquerque to
execute, deliver and perform this
74
Agreement and to consummate the transactions contemplated hereby have
been duly and validly taken; and this Agreement has been duly executed
and delivered by, and constitutes the valid and binding agreement of,
each of the Buyer and Bank of Albuquerque, enforceable in accordance
with its terms except as limited by bankruptcy, insolvency,
reorganization, fraudulent transfer, moratorium and similar laws
affecting creditors generally and by the availability of equitable
remedies;
(d) Subject to the satisfaction of any applicable governmental or
regulatory requirements referred to in Section 4.2(b), the execution,
delivery and performance by each of the Buyer and Bank of Albuquerque
of this Agreement do not, and the consummation by each of the Buyer and
Bank of Albuquerque of the transactions contemplated hereby will not,
violate or conflict with their respective articles of incorporation or
association or bylaws, or any law or regulation currently applicable to
the Buyer or Bank of Albuquerque, or any material agreement or
instrument, or currently applicable order, judgment or decree to which
either is a party or by which either is bound or require any prior
filing by the Buyer or Bank of Albuquerque with, or authorization,
approval, consent or other action with respect to either the Buyer or
Bank of Albuquerque by, any governmental or regulatory agency except
such as have been made or obtained and are in full force and effect or
will be made or obtained and are in full force and effect as of the
Closing;
(e) There are no actions, suits or proceedings pending or, to the
knowledge of the Buyer, threatened against or affecting, the Buyer or
Bank of Albuquerque, which may cause a material adverse change in the
business or financial condition of the Buyer or Bank of Albuquerque or
would prohibit consummation of the transactions contemplated hereunder;
(f) Neither the Buyer nor Bank of Albuquerque has paid or agreed to pay
any fee or commission to any agent, broker, finder or other person for
or on account of services rendered as a broker or finder in connection
with this Agreement or the transactions covered and contemplated
hereby. All negotiations relating to this Agreement have been conducted
by the Buyer directly and without the intervention of any person in
such manner as to give rise to any valid claim against the Seller for
any brokerage commission or like payment;
(g) Neither the Buyer nor Bank of Albuquerque has received written
notice from any federal or New Mexico governmental or regulatory agency
indicating that it would oppose or not grant or issue its consent or
approval, if required, with respect to the transactions contemplated by
this Agreement;
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(h) Each of the Buyer and Bank of Albuquerque satisfies each and all of
the standards and requirements lawfully within their respective control
of which each is aware (and, as of the Closing Date, will satisfy each
and all of the standards and requirements lawfully within their
respective control) imposed as a condition to obtaining, or necessary
to comply with and in order to obtain, any of the governmental or
regulatory approvals referred to in Section 4.2(b) of this Agreement;
(i) At the time of the most recent regulatory evaluation of Buyer's
performance under the Community Reinvestment Act (the "CRA"), Buyer's
record of performance was deemed to be "outstanding" or "satisfactory",
and no proceedings are pending or, to the knowledge of Buyer,
threatened, that would result in a change in such evaluation. Except as
previously disclosed in writing to Seller, Buyer has not received any
adverse public comments with respect to its compliance under the CRA
since the date of its most recent regulatory evaluation of its
performance under the CRA; and
(j) The Buyer has available sufficient cash or other liquid assets or
financing pursuant to binding agreements or commitments which may be
used to fund the transactions contemplated hereby and its ability to
consummate such transactions is not contingent on raising any equity
capital, obtaining specific financing therefor, consent of any lender
or any other matter."
ARTICLE 3
Employee Services
3.1 Employee Services. Prior to the Closing Date and ending by the
Closing Date, Seller agrees to loan certain employees ("Loaned Employees") to
Buyer to undertake such activities for Buyer as mutually agreed upon between
Seller and Buyer (the "Employee Training") by the execution of Assignment
Letters in substantially the form attached hereto as Exhibit B (each, an
"Assignment Letter"). Employees of Seller shall not be authorized to participate
in any Employee Training until an Assignment Letter has been executed by Seller
and agreed to by Buyer in accordance herewith. Unless otherwise expressly
provided herein or in an Assignment Letter, if any term or provision contained
in an Assignment Letter conflicts with any other terms or provisions of the
Agreement, such other terms or provisions of the Agreement shall govern.
Further, Seller's obligation hereunder is to use reasonable efforts to make
Employees available to Buyer, without materially affecting the continuing
operations of the Branches and the Offices. Should any Employee's employment
relationship with Seller end for any reason, Seller shall have no obligation to
replace such Employees.
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3.2 Assignment Letter Changes. All changes or modifications to any
Assignment Letter require the prior written approval of Buyer and Seller.
3.3 Supervision. While a Loaned Employee is being trained by Buyer
hereunder, Buyer will ensure that:
(a) Buyer shall supervise and instruct the Loaned Employee
with regard to the training being provided to the Loaned Employee;
(b) Such Loaned Employee shall not be named or act in any way
in the capacity as an employee of Buyer unless expressly agreed by
Seller and Buyer in each individual instance in writing;
(c) Training performed by a Loaned Employee on behalf of Buyer
for other Loaned Employees, if requested by Buyer, shall be reviewed by
Buyer's supervisors on a regular basis;
(d) If a Loaned Employee is being trained by Buyer while
working for Seller, Buyer will cooperate with Seller to balance such
Loaned Employee's work in a reasonable fashion, consistent with the
terms of the Assignment Letter; and
(e) Buyer and its officers, employees and agents will not
request or direct any Loaned Employee to disclose to Buyer or any other
party confidential information of Seller or otherwise direct or
encourage the Loaned Employee to take any action that would be
detrimental to Seller, its customers, or otherwise impede or diminish
the value to Seller of the transactions contemplated by the Agreement.
In the event that Buyer or its officers, employees or agents gain
possession of any such confidential information of Seller, Buyer shall
immediately return such confidential information to Seller. Buyer will
direct all requests for Seller's confidential information only to those
officers of Seller who have been designated in writing by Seller as
authorized contacts.
3.4 Payment. (a) Unless otherwise specified in an Assignment Letter,
Buyer will pay Seller for Employee Training in an amount equal to the
incremental additional compensation costs for each unit (computed on the basis
of actual FTE usage less FTE budget for the period) incurred by Seller as a
result of each such Loaned Employees' participation in such Employee
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Training for the time during which the Employee Training is being conducted.
Such incremental additional compensation costs shall be computed on the basis of
actual FTE usage less FTE budget for the period multiplied by the blended
average base salary rate for such unit (plus, where applicable, an additional
28% of such base salary rate to cover benefits). Buyer shall not be responsible
for payment for an Employee's absence due to vacation, holidays, illness or
leaves of absence, unless otherwise specified in an Assignment Letter. Seller
will invoice Buyer monthly on net thirty (30) day terms, unless otherwise
specified in the applicable Assignment Letter.
(b) Travel and Meal Expenses. Loaned Employees will submit travel and
meal expenses incurred by such Loaned Employees as set forth in the Assignment
Letter to Seller for reimbursement, in accordance with Seller's travel policy.
Buyer will reimburse Seller for all such travel and meal expenses, which will be
submitted to Buyer on Seller's monthly invoices.
3.5 Insurance and Indemnification.
(a) Scope. With respect to Employee Training and any claims, losses, or
expense arising in connection with the Employee Training, this Section 3.5 shall
control, and Article 9 of the Agreement shall not apply.
(b) Insurance. Each party shall obtain and maintain at its own expense,
the insurance coverage it deems appropriate to adequately insure itself against
losses arising under this Article 3.
(c) Expenses and Allocation of Risk of Loss. Prior to the Closing Date,
the following expenses and risks of loss shall be allocated between Buyer and
Seller as follows:
(i) Seller shall be responsible for the Loaned Employees'
salary, benefits, workers' compensation coverage and unemployment
benefits; and
(ii) Buyer shall be responsible for, and Buyer's insurance
(both on behalf of Buyer and the Loaned Employee) shall answer to any
losses of Buyer, Seller or any third party arising out of or related to
any act or omission of a Loaned Employee while involved in Employee
Training for Buyer.
(d) Indemnification. Buyer shall indemnify and hold harmless each of
Seller and its employees, officers, directors, representatives, and agents and
each of their respective heirs, personal representatives, successors, and
assigns, from any and all claims, actions, causes of action, demands, liability,
losses, costs and expenses (including court costs and reasonable fees of
attorneys and other professionals, including the
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allocated cost of internal counsel) which (i) are the responsibility of Buyer
under subsections (b) and (c) above, or (ii) arise with respect to any claim by
a Loaned Employee for damages not covered by workers' compensation coverage by a
Loaned Employee arising from any claim of injury incurred or sustained by such
Loaned Employee while involved in Employee Training for the Buyer. Because
Seller is self-insured for workers' compensation purposes, Buyer agrees to
reimburse Seller for out-of-pocket expenses incurred as a result of an injury
sustained by such Loaned Employee while involved in Employee Training for Buyer.
After receipt by Seller of notice of commencement of any action against
it in respect of which a claim is to be made against Buyer under this Section,
Seller will promptly notify Buyer of the commencement of such action, enclosing
a copy of all papers served, but the omission to so notify Buyer will not
relieve Buyer from any liability that it may have to Seller under the foregoing
provisions of this Article 3 unless, and only to the extent that, such omission
results in the loss of substantive rights or defenses by Buyer. If any such
action is brought against Seller and it notifies Buyer of its commencement,
Buyer will be entitled to participate in and, to the extent that it elects by
delivering written notice to Seller promptly after receiving notice of the
commencement of the action from Seller, to assume the defense of the action,
with counsel reasonably satisfactory to Seller, and after notice from Buyer to
Seller of its election to assume the defense. Buyer will not be liable to Seller
for any legal or other expenses except as provided below and except for the
reasonable costs of investigation subsequently incurred by the Seller in
connection with the defense. Seller will have the right to employ its own
counsel in any such action, but the fees, expenses and other charges of such
counsel will be at the expense of Seller unless (1) the employment of counsel by
Seller has been authorized in writing by Buyer, (2) Seller has reasonably
concluded (based on advice of counsel) that there may be legal defenses
available to it that are different from or in addition to those available to
Buyer, (3) a conflict or potential conflict exists (based on advice of counsel
to Seller) between Seller and Buyer (in which case Buyer will not have the right
to direct the defense of such action on behalf of Seller) or (4) Buyer has not
in fact employed counsel to assume the defense of such action within a
reasonable time after receiving notice of the commencement of the action, in
each of which cases the reasonable fees, disbursements and other charges or
counsel will be at the expense of Buyer. It is understood that Buyer shall not,
in connection with any proceeding or related proceedings in the same
jurisdiction, be liable for the reasonable fees, disbursements and other charges
of more than one separate firm admitted to practice in such jurisdiction at any
one time for Seller. All such fees, disbursements and other charges will be
reimbursed by Buyer promptly as they are incurred. Buyer will
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not be liable for any settlement of any action or claim effected without its
written consent (which consent will not be unreasonably withheld).
3.6 Termination of Assignment Letter Without Cause. Buyer at its sole
discretion, may elect to terminate any Assignment Letter effective immediately
upon written notice thereof to Seller. Upon receipt of such notice, Seller and
the respective Loaned Employee immediately shall cease all Employee Training
under the applicable Assignment Letter, and Buyer will pay Seller's final
invoice for all Employee Training rendered pursuant to the terminated Assignment
Letter through the date of such termination.
3.7 Relationship of the Parties. No joint venture, partnership, agency,
employment relationship or other joint enterprise between Seller and Buyer is
contemplated hereby during the training period. No employee of Seller shall be
considered an employee of the Buyer during this training period. Seller shall
take all actions and do all things which are required to ensure that it has
complied with all laws respecting its position as the employer providing
Employee Training pursuant hereto. In performing their respective obligations
under this Article 3, the parties shall act at all times as independent
contractors, and at no time shall either party make any commitments or incur any
charges or expenses for or in the name of the other party.
3.8 Employment Taxes and Benefits. To the extent required under
applicable law, Seller shall report as income all compensation received by
Seller pursuant hereto and pay all taxes due on such compensation. Seller shall
indemnify and hold harmless Buyer and its employees, officers, directors,
representatives and agents, and their respective heirs, personal
representatives, successors and assigns, from any and all claims, actions,
causes of action, demands, liability, losses, costs and expenses (including
court costs and reasonable fees of attorneys and other professionals) arising
from any obligation imposed on Buyer to pay any withholding taxes, social
security, unemployment insurance, workers' compensation insurance, disability
insurance or similar items, including interest and penalties thereon, in
connection with any payments made to Seller by Buyer pursuant hereto.
ARTICLE 4
Branch Support Center
4.1 Lease of Certain Branch Support Center Premises. Buyer and Seller
hereby covenant and agree to execute and deliver the BSC Lease (as hereinafter
defined) on the Closing Date, and to take all other action necessary to be taken
to cause the BSC Lease to become effective as of the Closing Date.
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As used herein, "BSC Lease" shall mean that certain lease agreement between
Buyer, as lessor, and Seller, as lessee, relating to certain premises located at
the Branch Support Center, which lease agreement shall be in substantially the
form attached hereto as Exhibit C.
4.2 Section 7.1. Section 7.1 of the Agreement shall be amended to add a
subsection (g) as follows:
"(g) The BSC Lease shall have become effective as of the Closing Date."
4.3 Environmental Due Diligence Period. Buyer and Seller hereby
acknowledge and agree that the Environmental Due Diligence Period with respect
to the Branch Support Center began on September 11, 1998 and concluded on
September 30, 1998.
ARTICLE 5
Miscellaneous
5.1 Terms of Original Agreement Ratified. Except as amended or modified
hereby, the terms, covenants and provisions of the Original Agreement are hereby
ratified and confirmed and shall remain in full force and effect.
5.2 Governing Law. This Amendment and the rights and obligations of the
parties hereto shall be governed by and construed in accordance with the laws of
the State of California.
5.3 Entire Agreement. This Amendment constitutes the entire agreement
of the parties hereto with respect to the amendments contained herein and
supersedes any prior expressions of intent or understandings with respect
thereto.
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5.4 Counterparts. This Amendment may be executed in two or more
counterparts and by different parties hereto on separate counterparts, each of
which shall be deemed an original and all of which together shall constitute one
and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their duly authorized officers as of the date first above written.
BANK OF AMERICA NATIONAL
TRUST AND SAVINGS ASSOCIATION
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
--------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Executive Vice President
BOK FINANCIAL CORPORATION
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇
Executive Vice President
and Chief Financial
Officer
BANK OF ALBUQUERQUE, NATIONAL
ASSOCIATION (IN FORMATION)
By /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇
Executive Vice President
and Chief Financial
Officer