EXHIBIT 2.2
AGREEMENT AND PLAN OF MERGER
BETWEEN
BANKUNITED FINANCIAL CORPORATION
AND
CONSUMERS BANCORP, INC.
September 19, 1997
TABLE OF CONTENTS
Page
ARTICLE I
CERTAIN DEFINITIONS
1.01 Certain Definitions....................................................1
ARTICLE II
THE MERGER AND RELATED TRANSACTIONS
2.01 Merger.................................................................6
2.02 Time and Place of Closing..............................................7
2.03 Effective Time.........................................................7
2.04 Further Actions........................................................7
ARTICLE III
MANNER OF CONVERTING SHARES
3.01 Conversion.............................................................8
ARTICLE IV
EXCHANGE OF SHARES
4.01 Exchange Procedures....................................................9
4.02 Voting and Dividends..................................................10
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF CONSUMERS
5.01 Organization, Standing, and Authority.................................11
5.02 Consumers Capital Stock...............................................11
5.03 Subsidiaries..........................................................12
5.04 Authorization of Merger and Related Transactions......................12
5.05 Consumers Financial Statements........................................13
5.06 Absence of Undisclosed Liabilities....................................13
5.07 Tax Matters...........................................................14
5.08 Allowance for Loan Losses.............................................14
5.09 Other Tax and Regulatory Matters......................................15
5.10 Properties............................................................15
5.11 Compliance with Laws..................................................15
5.12 Employee Benefit Plans................................................16
5.13 Commitments and Contracts.............................................17
5.14 Material Contract Defaults............................................18
5.15 Legal Proceedings.....................................................18
5.16 Absence of Certain Changes or Events..................................19
5.17 Reports...............................................................19
5.18 Statements True and Correct...........................................19
5.19 Insurance.............................................................19
5.20 Labor.................................................................20
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5.21 Material Interests of Certain Persons.................................20
5.22 Registration Obligations..............................................20
5.23 Brokers and Finders...................................................20
5.24 Takeover Laws.........................................................20
5.25 Environmental Matters.................................................20
5.26 Support of Stockholders...............................................21
ARTICLE VI
REPRESENTATIONS AND WARRANTIES OF BANKUNITED
6.01 Organization..........................................................21
6.02 BankUnited Capital Stock..............................................22
6.03 Subsidiaries..........................................................22
6.04 Authorization of Merger and Related Transactions......................22
6.05 Financial Statements..................................................23
6.06 Securities Reporting Documents........................................23
6.07 Absence of Undisclosed Liabilities....................................24
6.08 Absence of Certain Changes or Events..................................24
6.09 Compliance with Laws..................................................24
6.10 Allowance for Loan Losses.............................................25
6.11 Statements True and Correct...........................................25
6.12 Capital Stock.........................................................25
6.13 Properties............................................................25
6.14 Tax and Regulatory Matters............................................26
6.15 Litigation............................................................26
6.16 Brokers and Finders...................................................26
6.17 Material Contract Defaults............................................26
6.18 Insurance.............................................................26
ARTICLE VII
CONDUCT OF BUSINESSES PRIOR TO THE EFFECTIVE TIME
7.01 Conduct of Business Prior to the Effective Time.......................27
7.02 Forbearances of Consumers.............................................27
ARTICLE VIII
ADDITIONAL AGREEMENTS
8.01 Access and Information................................................29
8.02 Registration Statement; Regulatory Matters............................30
8.03 Stockholders' Approval................................................30
8.04 Press Releases........................................................31
8.05 Notice of Defaults....................................................31
8.06 Miscellaneous Agreements and Consents; Affiliates Agreements..........31
8.07 Indemnification of Consumers..........................................31
8.08 Falls Branch Sublease.................................................32
8.09 Stock Options.........................................................32
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8.10 Certain Change of Control Matters.....................................33
8.11 Stock Exchange Listing................................................33
8.12 Employee Benefits.....................................................33
8.13 Certain Actions.......................................................34
8.14 Acquisition Proposals.................................................34
8.15 Termination Fee.......................................................35
ARTICLE IX
CONDITIONS
9.01 Conditions to Each Party's Obligation to Effect the Merger............36
9.02 Conditions to Obligations of Consumers to Effect the Merger...........37
9.03 Conditions to Obligations of BankUnited to Effect the Merger..........38
ARTICLE X
TERMINATION
10.01 Termination...........................................................38
10.02 [Intentionally Omitted]...............................................40
10.03 Effect of Termination.................................................40
10.04 Survival of Representations, Warranties and Covenants
Following the Effective Time .....................................40
ARTICLE XI
GENERAL PROVISIONS
11.01 Expenses..............................................................40
11.02 Entire Agreement......................................................40
11.03 Amendments............................................................40
11.04 Waivers...............................................................40
11.05 No Assignment.........................................................41
11.06 Notices...............................................................41
11.07 Specific Performance..................................................41
11.08 Governing Law.........................................................42
11.09 Counterparts..........................................................42
11.10 Captions..............................................................42
11.11 Severability..........................................................42
LIST OF EXHIBITS
Exhibit A Board of Directors of Resulting Institution
Exhibit B Offices of Resulting Institution
Exhibit C Rule 145 Affiliate Agreement Pursuant to Section 8.06
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AGREEMENT AND PLAN OF MERGER
THIS AGREEMENT AND PLAN OF MERGER (this "Agreement") dated as of
September 19, 1997, between BANKUNITED FINANCIAL CORPORATION ("BankUnited"), a
Florida corporation and CONSUMERS BANCORP, INC., a Florida corporation
("Consumers").
WITNESSETH:
WHEREAS, pursuant to the terms and subject to the conditions of this
Agreement, BankUnited will acquire Consumers through the merger of Consumers
with and into BankUnited or by such other means as provided for herein (the
"Merger"); and
WHEREAS, promptly following the Merger, Consumers Savings Bank, a
subsidiary of Consumers, will be merged with and into BankUnited, FSB, a
subsidiary of BankUnited; and
WHEREAS, the respective Boards of Directors of BankUnited and Consumers
have resolved that the transactions described herein are in the best interests
of the parties and their respective stockholders and have approved the
transactions described herein, and
WHEREAS, BankUnited and Consumers desire to provide for certain
undertakings, conditions, representations, warranties and covenants in
connection with the transactions contemplated by this Agreement;
NOW THEREFORE, in consideration of the premises and the mutual
representations, warranties and agreements contained herein, the parties hereto
agree as follows:
ARTICLE I
CERTAIN DEFINITIONS
1.01 CERTAIN DEFINITIONS. As used in this Agreement, the following terms
shall have the meanings set forth below. Capitalized terms not otherwise defined
herein shall have the meanings ascribed in this Article I.
(a) "Acquisition Proposal" shall have the meaning set forth in
Section 8.14.
(b) "Acquisition Transaction" shall have the meaning set forth in
Section 8.14.
(c) "Affiliate" shall mean, with respect to any Person, any Person
that, directly or indirectly, controls or is controlled by or is under
common control with such Person.
(d) "Agreed Value" shall have the meaning set forth in Section
3.01(a)(ii).
(e) "Agreement" shall have the meaning set forth in the
introduction to this Agreement.
(f) "Allowance" shall have the meaning set forth in Section 5.08.
(g) "Approvals" shall mean any and all permits, consents,
authorizations and approvals of any governmental or regulatory authority
or of any other third person necessary to give effect to the arrangement
contemplated by this Agreement or necessary to consummate the Merger.
(h) "Authorizations" shall have the meaning set forth in Section
5.01.
(i) "BankUnited" shall have the meaning set forth in the
introduction to this Agreement.
(j) "BankUnited Common Stock" shall mean the Series I Class A
Common Stock of BankUnited.
(k) "BankUnited Financial Statements" shall have the meaning set
forth in Section 6.05.
(l) "BankUnited SEC Documents" shall have the meaning set forth in
Section 6.05.
(m) "Closing" shall have the meaning set forth in Section 2.02.
(n) "Closing Net Worth" shall mean Consumers Net Worth, but not
including the filing fees paid to the regulatory authorities or to the
SEC in connection with the approvals for the transaction, payments made
by Consumers at the request of BankUnited to the holders of Consumers
stock options pursuant to Section 8.09 just prior to closing, changes in
the market value of Consumers investment portfolio, or expenses related
to the Falls branch that are requested by BankUnited.
(o) "Code" shall mean the Internal Revenue Code of 1986, as
amended, and the rules and regulations thereunder.
(p) "Condition" shall have the meaning set forth in Section 5.01.
(q) "Consumers" shall have the meaning set forth in the
introduction to this Agreement.
(r) "Consumers Benefit Plan" shall have the meaning set forth in
Section 5.12(a).
(s) "Consumers Board" shall mean the Board of Directors of
Consumers.
(t) "Consumers Common Stock" shall mean the common stock, par value
$.01 per share, of Consumers.
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(u) "Consumers Disclosure Schedule" shall mean that document
containing the written detailed information prepared by Consumers and
delivered by Consumers to BankUnited which appropriately
cross-references each Section of the Agreement to which that Section of
the Consumers Disclosure Schedule applies.
(v) "Consumers ERISA Plan" shall have the meaning set forth in
Section 5.12(a).
(w) "Consumers Financial Statements" shall have the meaning set
forth in Section 5.05.
(x) "Consumers Net Worth" shall mean the net worth of Consumers as
determined in accordance with GAAP as at the month end prior to the
Effective Time and as adjusted for events occurring between such month
end and the Effective Time which either individually or in the aggregate
have had or immediately will have a Material Adverse Effect on
Consumers.
(y) "Consumers Options" shall have the meaning set forth in Section
8.09(a).
(z) "Consumers Stock Plan" shall have the meaning set forth in
Section 5.12(a).
(aa) "Current Employee" shall have the meaning set forth in Section
8.12(a).
(ab) "Effective Time" shall have the meaning set forth in Section
2.03.
(ac) "Employee" shall mean any current or former employee, officer
or director, independent contractor or retiree of Consumers or its
Subsidiaries and any dependent or spouse thereof.
(ad) "Environmental Law" shall have the meaning set forth in Section
5.25.
(ae) "ERISA" shall have the meaning set forth in Section 5.12(a).
(af) "Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended.
(ag) "Exchange Agent" shall have the meaning set forth in Section
3.01(c).
(ah) "Expenses" shall have the meaning set forth in Section 8.15(a).
(ai) "Fair Market Value" shall have the meaning set forth in Section
3.01(a)(ii).
(aj) "FDIA" shall mean the Federal Deposit Insurance Act.
(ak) "FDIC" shall mean the Federal Deposit Insurance Corporation.
(al) "GAAP" shall mean generally accepted accounting principles in
the United States.
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(am) "Hired Employees" shall have the meaning set forth in Section
8.12(b)(iii).
(an) "HOLA" shall mean the Home Owners' Loan Act of 1933, as
amended.
(ao) "Indemnified Party" shall have the meaning set forth in Section
8.07.
(ap) "In the Ordinary Course" shall have the meaning set forth in
Section 7.02(a).
(aq) "Liens" shall have the meaning set forth in Section 5.03.
(ar) "Material Adverse Effect" shall have the meaning set forth in
Section 5.01.
(as) "Material Adverse Effect on BankUnited" shall have the meaning
set forth in Section 6.01.
(at) "Merger" shall have the meaning set forth in the recitals to
this Agreement.
(au) "Merger Consideration" shall mean the combination of (i)
BankUnited Common Stock and (ii) cash to be issued by BankUnited in the
Merger, subject to adjustment as provided in Section 10.01(g).
(av) "NASD" shall mean the National Association of Securities
Dealers, Inc.
(aw) "NASDAQ" shall mean The Nasdaq Stock Market, Inc.
(ax) "OTS" shall mean the Office of Thrift Supervision.
(ay) "Person" or "person" shall mean any individual, corporation,
association, partnership, group (as defined in Section 13(d)(3) of the
Exchange Act), joint venture, trust or unincorporated organization, or a
government or any agency or political subdivision thereof.
(az) "Proxy Statement" shall have the meaning set forth in Section
5.18.
(ba) "Registration Statement" shall have the meaning set forth in
Section 5.18
(bb) "Regulatory Agreements" shall have the meaning set forth in
Section 5.11 (b).
(bc) "Regulatory Authorities" shall have the meaning set forth in
Section 5.11 (b).
(bd) "Reports" shall have the meaning set forth in Section 5.17.
(be) "Resulting Institution" shall have the meaning set forth in
Section 2.01(e).
(bf) "SEC" shall mean the Securities and Exchange Commission.
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(bg) "Securities Act" shall mean the Securities Act of 1933, as
amended.
(bh) "Securities Laws" shall have the meaning set forth in Section
5.04(c).
(bi) "Securities Reporting Documents" shall have the meaning set
forth in Section 6.06.
(bj) "Stockholders' Meeting" shall have the meaning set forth in
Section 5.18.
(bk) "Subsidiaries Merger" shall have the meaning set forth in
Section 2.01(e).
(bl) "Subsidiary" shall mean, in the case of either BankUnited or
Consumers, any corporation, association or other entity in which it owns
or controls, directly or indirectly, 25% or more of the outstanding
voting securities or 25% or more of the total equity interest; provided,
however, that the term shall not include any such entity in which such
voting securities or equity interest is owned or controlled in a
fiduciary capacity, without sole voting power, or was acquired in
securing or collecting a debt previously contracted in good faith.
(bm) "Surviving Corporation" shall have the meaning set forth in
Section 2.01(a).
(bn) "Tax" or "Taxes" shall mean all federal, state, local and
foreign taxes, charges, fees, levies, imposts, duties or other
assessments, including, without limitation, income, gross receipts,
excise, employment, sales, use, transfer, license, payroll, franchise,
severance, stamp, occupation, windfall profits, environmental, federal
highway use, commercial rent, customs duties, capital stock, paid up
capital, profits, withholding, Social Security, single business and
unemployment, disability, real property, personal property,
registration, ad valorem, value added, alternative or add-on minimum,
estimated, or other tax or governmental fee of any kind whatsoever,
imposed or required to be withheld by the United States or any state,
local, foreign government or subdivision or agency thereof, including,
without limitation, any interest, penalties or additions thereto.
(bo) "Tax Return" shall mean any report, return, information return
or other information required to be supplied to a taxing authority in
connection with Taxes, including, without limitation, any return of an
affiliated or combined or unitary group that includes Consumers or its
Subsidiaries.
(bp) "Termination Fee" shall have the meaning set forth in Section
8.15(a).
(bq) "Voting Power" shall mean the right to vote generally in the
election of Directors of Consumers through the beneficial ownership of
Consumers Common Stock.
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ARTICLE II
THE MERGER AND RELATED TRANSACTIONS
2.01 MERGER.
(a) Subject to the terms and conditions of this Agreement, at the
Effective Time of the Merger (as defined in Section 2.03 of this
Agreement), Consumers shall be merged with and into BankUnited in
accordance with the provisions of Florida law and with the effect
provided therein. The separate corporate existence of Consumers shall
thereupon cease, and BankUnited shall be the surviving corporation in
the Merger (the "Surviving Corporation").
(b) As of the Effective Time of the Merger, the articles of
incorporation and bylaws of BankUnited shall be the articles of
incorporation and bylaws of the Surviving Corporation.
(c) The directors and officers of BankUnited immediately prior to
the Effective Time shall be the directors and officers of the Surviving
Corporation, in each case, until their respective directors are duly
elected and qualified.
(d) All assets of Consumers as they exist at the Effective Time of
the Merger shall pass to and vest in the Surviving Corporation without
any conveyance or other transfer. The Surviving Corporation shall be
responsible and liable for all of the liabilities of every kind and
description of Consumers as of the Effective Time of the Merger.
(e) Promptly following the Effective Time of the Merger, Consumers
Savings Bank shall be merged with and into BankUnited, FSB (the
"Subsidiaries Merger") in accordance with applicable law and with the
effect provided therein. The separate corporate existence of Consumers
Savings Bank shall thereupon cease, and BankUnited, FSB shall be the
surviving bank in the Subsidiaries Merger (the "Resulting Institution").
(f) Upon the consummation of the Subsidiaries Merger the charter
and bylaws of BankUnited, FSB shall be the charter and bylaws of the
Resulting Institution.
(g) The directors and officers of BankUnited, FSB immediately prior
to the consummation of the Subsidiaries Merger shall be the directors
and officers of the Resulting Institution, in each case, until their
respective successors are duly elected and qualified. The Resulting
Institution shall have directors whose terms shall be for three years.
The directors of the Resulting Institution and their home addresses are
set forth in Exhibit A hereto.
(h) All assets of Consumers Savings Bank as they exist at the time
of consummation of the Subsidiaries Merger shall pass to and vest in the
Resulting Institution without any conveyance or other transfer. The
Resulting Institution shall be responsible and liable for all of the
liabilities of every kind and description of Consumers Savings Bank at
the time of consummation of the Subsidiaries Merger.
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(i) The name of the Resulting Institution shall be BankUnited, FSB.
The location of the home office of the Resulting Institution shall be
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇. The locations of
offices of the Resulting Institution are set forth in Exhibit B hereto.
(j) Upon the consummation of the Subsidiaries Merger, the savings
account holders of Consumers Savings Bank shall be issued savings
accounts of the Resulting Institution containing substantially the same
terms and conditions as those issued by Consumers Savings Bank.
(k) Notwithstanding any provision to the contrary, BankUnited may
elect to modify the structure of the transactions contemplated hereby so
long as (1) there is no material adverse federal or state income tax
consequences to Consumers and its stockholders or to holders of Options
to purchase Consumers Common Stock, (2) the Merger Consideration is not
reduced in kind or amount and (3) the notification will not delay or
jeopardize the receipt of any regulatory approval.
2.02 TIME AND PLACE OF CLOSING. The closing of the transactions
contemplated hereby (the "Closing") will take place at the offices of Stuzin and
Camner, P. A. in Miami, Florida at 10:00 A.M. on the date that the Effective
Time occurs, or at such other time, and at such other place, as may be mutually
agreed upon by BankUnited and Consumers.
2.03 EFFECTIVE TIME. The effective time of the consummation of the
Merger (the "Effective Time") shall occur on or promptly after the first
business day following the last to occur of (i) the date that is 30 days after
the date of the order of the OTS approving the Merger and the Subsidiaries
Merger, (ii) the effective date of the last order, approval, or exemption of any
other federal or state regulatory agency approving or exempting the Merger and
the Subsidiaries Merger, if such action is required, (iii) the expiration of all
required waiting periods after the filing of all notices to all federal or state
regulatory agencies required for consummation of the Merger and the Subsidiaries
Merger, and (iv) the date on which the stockholders of Consumers approve this
Agreement, in each case as contemplated hereby. The Effective Time may occur at
such other date and time as the parties hereto shall agree to in writing.
2.04 FURTHER ACTIONS. To facilitate the Merger and the acquisition of
Consumers by BankUnited, each of the parties will execute or will cause to be
executed, such additional agreements and documents and take such other actions
as BankUnited determines to be reasonably necessary or appropriate.
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ARTICLE III
MANNER OF CONVERTING SHARES
3.01 CONVERSION.
(a) Subject to the provisions of this Article III and of Article I,
at the Effective Time, by virtue of the Merger and without any action on
the part of the holders thereof, the shares of the constituent
corporations shall be converted as follows:
(i) Each share of capital stock of BankUnited issued and
outstanding immediately prior to the Effective Time shall remain
outstanding as one share of capital stock of the Surviving
Corporation;
(ii) Subject to adjustment as described in subsection (b)
hereof, and Section 10.01(g), each share of Consumers Common Stock
issued and outstanding immediately prior to the Effective Time
shall be converted into and become the right to receive a payment
(the "Merger Consideration") of $21.33 in cash or 2.081 shares of
BankUnited Common Stock (the "Agreed Value"). Each shareholder may
elect to receive his, her or its total Merger Consideration in
cash, BankUnited Common Stock or a combination thereof, provided,
however, that (1) in the aggregate, the cash portion shall not
exceed 55% of the total amount of Merger Consideration, including
any cash paid in respect of fractional shares pursuant to
subsection (b) hereof, (2) the Merger Consideration shall not be
paid on shares as to which dissenters rights have been asserted
pursuant to ss.607.24 of the Florida General Corporation Act, and
(3) if the average fair market value of BankUnited Common Stock, as
determined by using the average closing price of one share of the
security computed for the 15-day trading period on the NASDAQ
system (as reported by THE WALL STREET JOURNAL or, if not reported
thereby, any other authoritative source), ending three days prior
to the Effective Time (the "Fair Market Value" or "FMV"), is
greater than $12.00 per share, the Agreed Value shall be determined
under the following formula:
2.081 X 12 = Agreed Value
----------
FMV
(iii) Each Consumers Option outstanding as of the Effective
Time shall be treated in accordance with the provisions of Section
8.09; and
(iv) At or before the Effective Time, BankUnited shall cause to
be deposited with the Exchange Agent an amount sufficient to pay
the cash portion of the Merger Consideration;
(b) Notwithstanding, any other provision of this Agreement, each
holder of shares of Consumers capital stock exchanged pursuant to the
Merger, who would otherwise have been entitled to receive a fraction of
a share of BankUnited Common Stock (after taking into
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account all certificates delivered by such holder) shall receive, in
lieu thereof, cash (without interest) in an amount equal to such
fractional part of a share of BankUnited Common Stock multiplied by the
Fair Market Value. No such holder will be entitled to dividends, voting
rights or any other rights as a stockholder in respect of any fractional
share.
(c) Notwithstanding the provisions of subsections (a) and (b)
hereof, and subject to adjustment as described in Section 10.01(g), if
the Fair Market Value of BankUnited Common Stock is less than $9.80 per
share, then BankUnited shall pay Consumers, in cash, a total purchase
price, including all amounts paid for Consumers Options pursuant to
Section 8.09, of $10,800,000.
(d) At the Effective Time, the stock transfer books of Consumers
shall be closed as to holders of Consumers capital stock immediately
prior to the Effective Time and no transfer of Consumers capital stock
by any such holder shall thereafter be made or recognized. If, after the
Effective Time, certificates are properly presented in accordance with
Article IV of this Agreement to the exchange agent, which shall be
selected by BankUnited and is deemed reasonably acceptable to Consumers
(the "Exchange Agent"), such certificates shall be canceled and
exchanged for certificates representing the appropriate number of shares
of BankUnited Common Stock and a check representing the amount of cash
selected as part of the Merger Consideration by such holder, or the
amount of cash in lieu of fractional shares, if any, into which the
Consumers capital stock represented thereby was converted in the Merger.
Any other provision of this Agreement notwithstanding, neither
BankUnited nor the Exchange Agent shall be liable to a holder of
Consumers capital stock for any amount paid or property delivered in
good faith to a public official pursuant to any applicable abandoned
property, escheat, or similar law. In the event any certificate shall
have been lost, stolen or destroyed, upon the making of an affidavit of
that fact by the person claiming such certificate to be lost, stolen or
destroyed and, if required by the Exchange Agent, the posting by such
person of a bond in such amount as the Exchange Agent may direct as
indemnity against any claim that may be made against it with respect to
such certificate, the Exchange Agent will issue in exchange for such
lost, stolen or destroyed certificate the Merger Consideration
deliverable in respect thereof pursuant to this Agreement.
ARTICLE IV
EXCHANGE OF SHARES
4.01 EXCHANGE PROCEDURES. Promptly after the Effective Time (but in no
event more than three business days following the Effective Time), BankUnited
and Consumers shall cause the Exchange Agent to mail appropriate transmittal
materials (which shall specify that delivery shall be effected, and risk of loss
and title to the certificates theretofore representing shares of Consumers
Common Stock shall pass, only upon proper delivery of such certificates to the
Exchange Agent) to the former stockholders of Consumers. After the Effective
Time, each holder of shares of Consumers Common Stock issued and outstanding at
the Effective Time (other than shares as to which dissenters' rights have been
asserted) shall surrender the certificate or certificates theretofore
representing such shares, together with such transmittal materials properly
executed, to the Exchange Agent and
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promptly upon surrender (but in no event more than three business days following
receipt by the Exchange Agent) shall receive in exchange therefor the
consideration provided in Section 3.01 of this Agreement. The certificate or
certificates for Consumers Common Stock so surrendered shall be duly endorsed as
the Exchange Agent may require. To the extent provided by Section 3.01 (c), each
holder of shares of Consumers Common Stock issued and outstanding at the
Effective Time also shall receive, upon surrender of the certificate or
certificates representing such shares, cash in lieu of any fractional shares of
BankUnited Common Stock to which such holder would otherwise be entitled.
BankUnited shall not be obligated to deliver the consideration to which any
former holder of Consumers Common Stock is entitled as a result of the Merger
until such holder surrenders his certificate or certificates representing shares
of Consumers capital stock for exchange as provided in this Article IV or the
Exchange Agent receives documents sufficient, in the discretion of the Exchange
Agent and BankUnited, to evidence the holders ownership interest in Consumers
Common Stock. In addition, certificates surrendered for exchange by any person
constituting an "affiliate" of Consumers for purposes of Rule 145(c) under the
Securities Act shall not be exchanged for certificates representing whole shares
of BankUnited Common Stock until BankUnited has received a written agreement
from such person as provided in Section 8.06. Certificates representing
BankUnited Common Stock issued in the Merger to any person constituting an
"affiliate" of Consumers for purposes of Rule 145(c) under the Securities Act
shall bear the following legend:
"THE SHARES REPRESENTED BY THIS CERTIFICATE WERE ISSUED IN A
TRANSACTION TO WHICH RULE 145 PROMULGATED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, APPLIES. NO TRANSFER OF SUCH SHARES
SHALL BE VALID OR EFFECTIVE UNTIL THE CONDITIONS OF SUCH RULE
HAVE BEEN FULFILLED."
If any certificate for shares of BankUnited Common Stock, or any check
representing cash, is to be issued in a name other than that in which a
certificate surrendered for exchange is issued, the certificate so surrendered
shall be properly endorsed and otherwise in proper form for transfer and the
person requesting such exchange shall affix any requisite stock transfer tax
stamps to the certificate surrendered or provide funds for their purchase or
establish to the satisfaction of the Exchange Agent that such taxes are not
payable.
4.02 VOTING AND DIVIDENDS. Former stockholders of record of Consumers
shall be entitled to vote after the Effective Time at any meeting of BankUnited
stockholders the number of whole shares of BankUnited Common Stock into which
their respective shares of Consumers capital stock are converted, regardless of
whether such holders have exchanged their certificates representing Consumers
capital stock for certificates representing BankUnited Common Stock in
accordance with the provisions of this Agreement. Until surrendered for exchange
in accordance with the provisions of Section 4.01, each certificate theretofore
representing shares of Consumers capital stock shall from and after the
Effective Time represent for all purposes only the right to receive shares of
BankUnited Common Stock and cash, as set forth in this Agreement. No dividend or
other distribution payable to the holders of record of BankUnited Common Stock,
at or as of any time after the Effective Time, shall be paid to the holder of
any certificate representing shares of Consumers capital stock issued and
outstanding at the Effective Time until such holder physically surrenders such
certificate for exchange as provided in Section 4.01, promptly after which time
all such dividends or distributions which have been declared and paid following
the Effective Time shall be paid (without interest).
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ARTICLE V
REPRESENTATIONS AND WARRANTIES OF CONSUMERS
Consumers represents and warrants to BankUnited, subject to such
exceptions and limitations as are set forth below or in the Consumers Disclosure
Schedule, as follows:
5.01 ORGANIZATION, STANDING, AND AUTHORITY. Consumers is a corporation
duly organized validly existing and in good standing under the laws of the State
of Florida. Consumers is duly qualified to do business and in good standing in
all jurisdictions (whether federal, state, local or foreign) where its ownership
or leasing of property or the conduct of its business requires it to be so
qualified and in which the failure to be duly qualified would have a material
adverse effect on the financial condition, results of operations or business
(the "Condition") of Consumers and its Subsidiaries on a consolidated basis or
on the ability of Consumers to consummate the transactions contemplated hereby
(a "Material Adverse Effect"). Consumers has all requisite corporate power and
authority to carry on its business as now conducted and to own, lease and
operate its assets, properties and business, except where the failure to have
such power and authority would not have a Material Adverse Effect, and to
execute and deliver this Agreement and perform the terms of this Agreement.
Consumers has in effect all federal, state, local and foreign governmental,
regulatory and other authorizations, permits and licenses (collectively,
"Authorizations") necessary for it to own or lease its properties and assets and
to carry on its business as now conducted, the absence of which, either
individually or in the aggregate, would have a Material Adverse Effect.
5.02 CONSUMERS CAPITAL STOCK.
(a) The authorized capital stock of Consumers consists of
15,000,000 shares of Consumers Common Stock. At March 31, 1997, there
were outstanding 485,509 shares of Consumers Common Stock. All of the
issued and outstanding shares of Consumers capital stock are duly and
validly issued and outstanding and are fully paid and nonassessable.
None of the outstanding shares of the Consumers capital stock has been
issued in the violation of any preemptive rights or any provision of
Consumers' Articles of Incorporation. As of March 31, 1997 Consumers had
reserved 48,264 shares of Consumers Common Stock for issuance under the
Consumers Options, and no other shares of capital stock have been
reserved for any purpose. None of the Consumers Options are incentive
stock options within the meaning of Section 422 of the Internal Revenue
Code of 1986, as amended from time to time.
(b) Except as set forth in Section 5.02 of the Consumers Disclosure
Schedule, there are no shares of capital stock, or other equity
securities of Consumers outstanding and no outstanding options,
warrants, scrip, rights to subscribe to, calls or commitments of any
character whatsoever relating to, or securities or rights convertible
into or exchangeable for, shares of the capital stock of Consumers or
contracts, commitments, understandings or arrangements by which
Consumers is or may be bound to issue any equity security of Consumers
including any additional shares of its capital stock or options,
warrants or rights to purchase or acquire any additional shares of its
capital stock. There are no contracts, commitments, understandings or
arrangements by which Consumers or any of its Subsidiaries
11
is or may be bound to transfer any shares of the capital stock of any
Subsidiary of Consumers, except for a transfer to Consumers or any of
its wholly owned Subsidiaries and except as set forth in Section 5.02 of
the Consumers Disclosure Schedule, and there are no agreements,
understandings or commitments relating to the right of Consumers to vote
or to dispose of such shares, other than such as are held in a fiduciary
capacity.
(c) Except as set forth in Section 5.02 of the Consumers Disclosure
Schedule, there are no securities required to be issued by Consumers
under any Consumers Stock Plan, dividend reinvestment plan or similar
plan.
5.03 SUBSIDIARIES. Section 5.03 of the Consumers Disclosure Schedule
contains a complete list of Consumers' Subsidiaries. All of the issued and
outstanding shares of each Subsidiary are owned by Consumers and no equity
securities are or may become required to be issued by reason of any options,
warrants, scrip, rights to subscribe to, calls or commitments of any character
whatsoever relating to, or securities or rights convertible into or exchangeable
for, shares of any Subsidiary, and there are no contracts, commitments,
understandings or arrangements by which any Subsidiary is bound to issue
additional shares of its capital stock or options, warrants or rights to
purchase or acquire any additional shares of its capital stock. All of the
shares of capital stock of each Subsidiary are fully paid and nonassessable and
are owned free and clear of any claim, lien, pledge or encumbrance of whatsoever
kind ("Liens"). Each Subsidiary (i) is duly organized, validly existing, and in
good standing under the laws of the jurisdiction in which it is incorporated or
organized, (ii) is duly qualified to do business and in good standing in all
jurisdictions (whether federal, state, local or foreign) where its ownership or
leasing of property or the conduct of its business requires it to be so
qualified and in which the failure to be so qualified would have a Material
Adverse Effect, (iii) has all requisite corporate power and authority to own or
lease its properties and assets and to carry on its business as now conducted
and (iv) has in effect all Authorizations necessary for it to own or lease its
properties and assets and to carry on its business as now conducted, the absence
of which Authorizations, individually or in the aggregate, would have a Material
Adverse Effect.
5.04 AUTHORIZATION OF MERGER AND RELATED TRANSACTIONS.
(a) The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby have been duly and
validly authorized by all necessary corporate action in respect thereof
on the part of Consumers, including approval of the Merger by its Board
of Directors, subject to the approval of the stockholders of Consumers
with respect to the Merger to the extent required by the applicable law.
This Agreement, subject to any requisite regulatory and stockholder
approval hereof with respect to the Merger, represents a valid and
legally binding obligation of Consumers, enforceable against Consumers
in accordance with its terms, except as such enforcement may be limited
by bankruptcy, insolvency, reorganization, moratorium, and similar laws
of general applicability affecting creditors rights generally and by
general principles of equity (whether applied in a proceeding at law or
in equity).
(b) Except as set forth in Section 5.04 of the Consumers Disclosure
Schedule, neither the execution and delivery of this Agreement by
Consumers, nor the consummation by Consumers of the transactions
contemplated hereby or thereby nor compliance by
12
Consumers with any of the provisions hereof or thereof will (i) conflict
with or result in a breach of any provision of Consumers' Articles of
Incorporation or bylaws or (ii) constitute or result in a breach of any
term, condition or provision of, or constitute a default (or an event
which with notice or lapse of time or both would become a default)
under, or give rise to any right of termination, cancellation or
acceleration with respect to, or result in the creation of any Lien
upon, any property or assets of any of Consumers or its Subsidiaries
pursuant to any note, bond, mortgage, indenture, license, agreement,
lease or other instrument or obligation to which any of them is a party
or by which any of them or any of their properties or assets may be
subject and that would individually or in the aggregate have a Material
Adverse Effect, or (iii) subject to receipt of the requisite approvals
referred to in Section 9.01 of this Agreement, violate any order, writ,
injunction, decree, statute, rule or regulation applicable to Consumers
or its Subsidiaries or any of their properties or assets.
(c) Other than (i) in connection with complying with the provisions
of applicable state corporate, banking and securities laws, the
Securities Act, the Exchange Act, and the rules and regulations of the
SEC or the OTS promulgated thereunder (the "Securities Laws"), and (ii)
consents, authorizations, approvals or exemptions required from the OTS,
no notice to, filing with, authorization of, exemption by, or consent or
approval of any public body or authority is necessary for the
consummation by Consumers of the Merger and the other transactions
contemplated in this Agreement.
5.05 CONSUMERS FINANCIAL STATEMENTS. Consumers (i) has delivered to
BankUnited copies of the consolidated statements of financial condition of
Consumers and its Subsidiaries as of March 31, 1997 and 1996, and the related
consolidated statements of operations, stockholders' equity and cash flows for
each of the three years in the period ended ▇▇▇▇▇ ▇▇, ▇▇▇▇, (▇▇) until the
Closing will deliver to BankUnited promptly upon the filing thereof with the OTS
copies of the consolidated statements of financial condition and related
consolidated statements of operations, stockholders' equity and cash flows
included in any filing with the OTS, and (iii) until the Closing will deliver to
BankUnited within 10 business days of the end of each month copies of monthly
consolidated statements of financial condition and related consolidated
statements of operations (collectively, the "Consumers Financial Statements").
The Consumers Financial Statements (as of the dates thereof and for the periods
covered thereby) (A) are or will be in accordance with the books and records of
Consumers and its Subsidiaries, which are or will be complete and accurate in
all material respects and which have been or will have been maintained in
accordance with good business practices, and (B) present or will present fairly
the consolidated financial position and the consolidated results of operations,
changes in stockholders' equity and cash flows of Consumers and its Subsidiaries
as of the dates and for the periods indicated, in accordance with GAAP
consistently applied except as disclosed, subject in the case of interim
financial statements to normal recurring year-end adjustments and except for the
absence of certain footnote information in the unaudited statements. Consumers
has delivered to BankUnited (i) copies of all management letters prepared by
Deloitte & Touche LLP (and any predecessor thereto) delivered to Consumers since
January 1, 1993 and (ii) copies of audited balance sheets and related statements
of income, changes in stockholders' equity and cash flows for any Subsidiary of
Consumers since January 1, 1993 for which a separate audit has been performed.
5.06 ABSENCE OF UNDISCLOSED LIABILITIES. Except as set forth in the
Consumers Disclosure Schedule, neither Consumers nor any of its Subsidiaries has
any obligations or liabilities (contingent
13
or otherwise) in the aggregate amount of $35,000 or more, except obligations and
liabilities (i) which are fully accrued or reserved against in the consolidated
balance sheet of Consumers and its Subsid iaries as of March 31, 1997 included
in the Consumers Financial Statements or reflected in the notes thereto, or (ii)
which were incurred after March 31, 1997 in the ordinary course of business
consistent with past practice. Except as set forth in Section 5.06 of the
Consumers Disclosure Schedule, since March 31, 1997 neither Consumers nor any of
its Subsidiaries has incurred or paid any obligation or liability which would
have a Material Adverse Effect.
5.07 TAX MATTERS. Except as set forth in Section 5.07 of the Consumers
Disclosure Schedule:
(a) All Tax Returns required to be filed by or on behalf of
Consumers or any of its Subsidiaries have been timely filed, or requests
for extensions have been timely filed, granted and have not expired, for
periods ending on or before March 31, 1997, and all such returns filed
are complete and accurate in all material respects.
(b) There are no audits, examinations, deficiencies or refund
litigation or matters in controversy with respect to any Taxes that
might reasonably be expected individually or in the aggregate to result
in a determination the effect of which would have a Material Adverse
Effect. All Taxes due with respect to completed and settled examinations
or concluded litigation have been paid or adequately reserved for.
(c) Consumers has not executed an extension or waiver of any
statute of limitations on the assessment or collection of any Tax due
that is currently in effect.
(d) Adequate provision for any Taxes due or to become due for
Consumers and any of its Subsidiaries for any period or periods through
and including March 31, 1997, has been made and is reflected on the
March 31, 1997 financial statements included in the Consumers Financial
Statements. Deferred Taxes of Consumers and its Subsidiaries have been
provided for in the Consumers Financial Statements in accordance with
GAAP, applied on a consistent basis.
(e) Consumers and its Subsidiaries have collected and withheld all
Taxes which they have been required to collect or withhold and have
timely submitted all such collected and withheld amounts to the
appropriate authorities. Consumers and its Subsidiaries are in
compliance with the back-up withholding and information reporting
requirements under (1) the Code, and (2) any state, local or foreign
laws, and the rules and regulations, thereunder.
(f) Neither Consumers nor any of its Subsidiaries has made any
payments, is obligated to make any payments, or is a party to any
contract, agreement or other arrangement that could obligate it to make
any payments that would not be deductible under Section 28OG of the
Code.
5.08 ALLOWANCE FOR LOAN LOSSES. The allowance for loan losses (the
"Allowance") shown on the consolidated statement of condition of Consumers and
its Subsidiaries as of March 31, 1997 included in the Consumers Financial
Statements and the Allowance shown on the consolidated
14
statement of condition of Consumers and its Subsidiaries, as of dates subsequent
to the execution of this Agreement included in the Consumers Financial
Statements will be, in each case as of the dates thereof, sufficient, in
accordance with generally accepted accounting principles, to provide for losses
relating to or inherent in the loan and lease portfolios (including accrued
interest receivables) of Consumers and its Subsidiaries; other extensions of
credit (including letters of credit and commitments to make loans or extend
credit) by Consumers and its Subsidiaries; and the off balance sheet exposures,
if any, of Consumers and its Subsidiaries.
5.09 OTHER TAX AND REGULATORY MATTERS. Neither Consumers nor any of its
Subsidiaries has taken or agreed to take any action or has any knowledge of any
fact or circumstance that would (i) prevent the transactions contemplated
hereby, including the Merger, from qualifying as a reorganization within the
meaning of Section 368 of the Code, or (ii) materially impede or delay receipt
of any approval referred to in Section 9.01(b).
5.10 PROPERTIES. Except as disclosed in any Reporting Document filed
since March 31, 1997 and prior to the date hereof and except for Liens arising,
in the ordinary course of business after the date hereof, Consumers and its
Subsidiaries have good and marketable title, free and clear of all Liens that
are material to the Condition of Consumers and its Subsidiaries on a
consolidated basis, to all their material properties and assets whether tangible
or intangible, real, personal or mixed, reflected in the Consumers Financial
Statements as being owned by Consumers and its Subsidiaries as of the date
hereof. All buildings, and all fixtures, equipment and other property and assets
which are material to its business on a consolidated basis, held under leases or
subleases by any of Consumers or its Subsidiaries are held under valid
instruments enforceable in accordance with their respective terms, except as
such enforcement may be limited by bankruptcy, insolvency, reorganization,
moratorium and similar laws of general applicability affecting creditors rights
generally and by general principles of equity (whether applied in a proceeding
at law or in equity). Substantially all of Consumers' and Consumers'
Subsidiaries' equipment in regular use has been well maintained and is in good
serviceable condition, reasonable wear and tear excepted.
5.11 COMPLIANCE WITH LAWS.
(a) Except as set forth in Section 5.11(a) of the Consumers
Disclosure Schedule, each of Consumers and its Subsidiaries is in
compliance with all laws, rules, regulations, policies, guidelines,
reporting and licensing requirements and orders applicable to its
business or to its employees conducting its business, and with its
internal policies and procedures except for failures to comply which
will in the aggregate not result in a Material Adverse Effect.
(b) Except as set forth in Section 5.11(b) of the Consumers
Disclosure Schedule, neither Consumers nor any of its Subsidiaries has
received any notification or communication from any agency or department
of any federal, state or local government, including, the OTS, the FDIC,
and the staffs thereof (collectively, the "Regulatory Authorities") (i)
asserting that any of Consumers or its Subsidiaries is not in
substantial compliance with any of the statutes, regulations, or
ordinances which such agency, department or Regulatory Authority
enforces, or the internal policies and procedures of such company, (ii)
threatening to revoke any license, franchise, permit or governmental
authorization which is material to the Condition of
15
Consumers and its Subsidiaries on a consolidated basis, (iii) requiring
or threatening to require Consumers or any of its Subsidiaries, or
indicating that Consumers or any of its Subsidiaries may be required to
enter into a cease and desist order, agreement or memorandum of
understanding or any other agreement restricting or limiting or
purporting to restrict or limit in any manner the operations of
Consumers or any of its Subsidiaries, including, without limitation, any
restriction on the payment of dividends, or (iv) directing, restricting
or limiting, or purporting to direct, restrict or limit in any manner
the operations of Consumers or any of its Subsidiaries, including,
without limitation, any restriction on the payment of dividends (any
such notice, communication, memorandum, agreement or order described in
this sentence herein referred to as a "Regulatory Agreement").
(c) Neither Consumers nor any of its Subsidiaries has consented to
or entered into any Regulatory Agreement or memorandum of understanding.
(d) Neither Consumers nor any of its Subsidiaries is required by
Section 32 of FDIA to give prior notice to a federal banking agency of
the proposed addition of an individual to its board of directors or the
employment of an individual as a senior executive officer.
5.12 EMPLOYEE BENEFIT PLANS.
(a) Consumers has delivered or made available to BankUnited prior
to the execution of this Agreement true and complete copies (or, in the
case of bonus or other incentive plans, summaries thereof and financial
data with respect thereto) of all material pension, retirement,
profit-sharing, deferred compensation, stock option, employee stock
ownership, severance pay, vacation, bonus or other material incentive
plans, all other material employee programs, arrangements or agreements,
whether arrived at through collective bargaining or otherwise, all
material medical, vision, dental or other health plans, all life
insurance plans and all other material employee benefit plans or fringe
benefit plans, including, without limitation, all "employee benefit
plans" as that term is defined in Section 3(3) of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA"), currently
adopted by, maintained by, sponsored in whole or in part by, or
contributed to by Consumers or any of its Subsidiaries or any affiliate
thereof for the benefit of any Employee or under which any Employee is
eligible to participate and under which Consumers or any of its
Subsidiaries could have any liability contingent or otherwise
(collectively, the "Consumers Benefit Plans"). Any of the Consumers
Benefit Plans which is an "employee pension benefit plan," as that term
is defined in Section 3(2) of ERISA, is referred to herein as a
"Consumers ERISA Plan." Any of the Consumers Benefit Plans pursuant to
which Consumers is or may become obligated to, or obligated to cause any
of its Subsidiaries or any other Person to, issue, deliver or sell
shares of capital stock of Consumers or any of its Subsidiaries, or
grant, extend or enter into any option, warrant, call, right, commitment
or agreement to issue, deliver or sell shares, or any other interest in
respect of capital stock of Consumers or any of its Subsidiaries, is
referred to herein as a "Consumers Stock Plan." No Consumers Benefit
Plan is or has been a multiemployer plan within the meaning of Section
3(37) of ERISA. Consumers has set forth in Section 5.12 of the Consumers
Disclosure Schedule (i) a list of all of the Consumers Benefit Plans,
(ii) a list of
16
Consumers Benefit Plans that are Consumers ERISA Plans, (iii) a list of
Consumers Benefit Plans that are Consumers Stock Plans and (iv) a list
of the number of shares covered by, exercise prices for, and holders of,
all stock options granted and available for grant under the Consumers
Stock Plans.
(b) All Consumers Benefit Plans are in compliance with the
applicable terms of ERISA and the Code and any other applicable laws,
rules and regulations the breach or violation of which could reasonably
be expected to result in a Material Adverse Effect.
(c) All liabilities under any Consumers Benefit Plan are fully
accrued or reserved against in the Consumers Financial Statements in
accordance with GAAP. No Consumers ERISA Plan which is a defined benefit
pension plan has any "unfunded current liability," as that term is
defined in Section 302(d)(8)(A) of ERISA, and the present fair market
value of the assets of any such plan exceeds the plan's "benefit
liabilities," as that term is defined in Section 4001(a)(16) of ERISA,
when determined under actuarial factors that would apply if the plan
terminated in accordance with all applicable legal requirements.
(d) Neither Consumers nor any of its Subsidiaries has any
obligations for retiree health and life benefits under any Consumers
Benefit Plan or otherwise, except as set forth in the Consumers
Disclosure Schedule. There are no restrictions on the rights of
Consumers or its Subsidiaries to amend or terminate any such Consumers
Benefit Plan without incurring any material liability thereunder, except
for such restrictions as would not have a Material Adverse Effect.
(e) Except as set forth in the Consumers Disclosure Schedule.
neither the execution and delivery of this Agreement nor the
consummation of the transactions contemplated hereby or thereby will (i)
result in any payment (including, without limitation, severance, golden
parachute or otherwise) becoming due to any Employees under any
Consumers Benefit Plan or otherwise, (ii) increase any benefits
otherwise payable under any Consumers Benefit Plan or (iii) result in
any acceleration of the time of payment or vesting of any such benefits.
5.13 COMMITMENTS AND CONTRACTS. Except as set forth in the Consumers
Disclosure Schedule, neither Consumers nor any of its Subsidiaries is a party or
subject to, or has amended or waived any rights under, any of the following
(whether written or oral, express or implied):
(a) any employment contract or understanding (including any
understandings or obligations with respect to severance or termination
pay liabilities or fringe benefits) with any Employees, including in any
such person's capacity as a consultant (other than those which are
terminable at will by Consumers or such Subsidiary without cost to
Consumers or any Subsidiary;
(b) any labor contract or agreement with any labor union;
(c) any contract not made in the usual, regular and ordinary course
of business containing non-competition covenants which limit the ability
of Consumers or any of its
17
Subsidiaries to compete in any line of business or which involve any
restriction of the geographical area in which Consumers or its
Subsidiaries may carry on its business (other than as may be required by
law or applicable Regulatory Authorities);
(d) any real or personal property lease with annual rental payments
aggregating $5,000 or more;
(e) any employment or other contract requiring the payment of
additional amounts as "change in control" payments as a result of
transactions contemplated by this Agreement;
(f) any agreement with respect to (i) the acquisition of the assets
or stock of another financial institution or (ii) the sale of one or
more bank branches which would require additional payments by Consumers
after the date of this Agreement; or
(g) any outstanding, interest rate exchange or other derivative
contracts.
(h) any commitment or contract to acquire real property; or
(i) any other agreement to which Consumers or any of its
Subsidiaries is a party requiring payment by Consumers or any of its
Subsidiaries in excess of $10,000 during the remainder of the term of
such agreement, except as set forth in Section 5.13 of the Consumers
Disclosure Schedule.
5.14 MATERIAL CONTRACT DEFAULTS. Neither Consumers nor any of its
Subsidiaries is, or has received any notice or has any knowledge that any party
is, in default in any respect under any contract, agreement, commitment,
arrangement, lease, insurance policy or other instrument to which Consumers or
any of its Subsidiaries is a party or by which Consumers or any of its
Subsidiaries or the assets, business or operations thereof may be bound or
affected or under which it or its respective assets, business or operations
receives benefits, except for those defaults which would not have, individually
or in the aggregate, a Material Adverse Effect; and there has not occurred any
event that with the lapse of time or the giving of notice of both would
constitute such a default. No consent of any party to any contract to which
Consumers or any of its Subsidiaries is a party is required in connection with
the consummation of the transactions contemplated by this Agreement.
5.15 LEGAL PROCEEDINGS. Except as set forth in Section 5.15 of the
Consumers Disclosure Schedule, there are no actions, suits, proceedings or
investigations by Regulatory Authorities or any other Person instituted or
pending or, to the best knowledge of Consumers' management, threatened against
Consumers or any of its Subsidiaries, or against any property, asset, interest
or right of any of them, that might reasonably be expected to result in a
judgment in excess of $25,000 or that might reasonably be expected to threaten
or impede the consummation of the transactions contemplated by this Agreement.
Neither Consumers nor any of its Subsidiaries is a party to any agreement or
instrument or is subject to any charter or other corporate restriction or any
judgment, order, writ, injunction, decree, rule, regulation, code or ordinance
that, individually or in the aggregate, might reasonably be expected to have a
Material Adverse Effect or, might reasonably be expected to threaten or impede
the consummation of the transactions contemplated by this Agreement.
18
5.16 ABSENCE OF CERTAIN CHANGES OR EVENTS. Since March 31, 1997, except
as set forth in Section 5.16 of the Consumers Disclosure Schedule, neither
Consumers nor any of its Subsidiaries has (A) incurred or paid any liability or
obligation (contingent or otherwise) which individually or in the aggregate had
or is reasonably likely to have a Material Adverse Effect, (B) suffered any
change in its Condition which individually or in the aggregate is reasonably
likely to have a Material Adverse Effect, (C) failed to operate its business
consistent in all material respects with past practice, or (D) changed any
accounting practices.
5.17 REPORTS. Since July 1, 1992, Consumers and each of its Subsidiaries
have filed on a timely basis all reports and statements, together with all
amendments required to be made with respect thereto (collectively "Reports"),
that they were required to file with (i) the OTS, (ii) the FDIC, and (iii) any
other applicable state securities or banking authorities (except, in the case of
state securities authorities, filings which are not material). No Reports with
respect to periods beginning on or after July 1, 1992, and until the Closing
contained or will contain any information that was false or misleading, with
respect to any material fact or omitted or will omit to state any material fact
necessary in order to make the statements therein not misleading and each such
Report contained or will contain all information required to be stated therein.
5.18 STATEMENTS TRUE AND CORRECT. None of the information supplied or to
be supplied by Consumers for inclusion in the registration statement on Form
S-4, or other appropriate form, to be filed with the SEC by BankUnited under the
Securities Act in connection with the transactions contemplated by this
Agreement (the "Registration Statement"), or the proxy statement to be used by
Consumers in connection with obtaining all required approvals of its
stockholders as contemplated by this Agreement (the "Proxy Statement") will, in
the case of the Proxy Statement, when it is first mailed to the stockholders of
Consumers, contain any untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements made therein, in light
of the circumstances under which such statements are made, not misleading, or,
in the case of the Registration Statement, when it becomes effective, be false
or misleading with respect to any material fact, or omit to state any material
fact necessary in order to make the statements therein not misleading, or in the
case of the Proxy Statement or any amendment thereof or supplement thereto, at
the time of the meeting of the stockholders of Consumers to be held pursuant to
Section 8.03 of this Agreement, including any adjournments thereof (the
"Stockholders' Meeting"), be false or misleading with respect to any material
fact or omit to state any material fact necessary to correct any statement or
remedy any omission in any earlier communication with respect to the
solicitation of any proxy for the Stockholders' Meeting. All documents that
Consumers is responsible for filing with any Regulatory Authority in connection
with the transactions contemplated hereby will comply as to form in all material
respects with the provisions of applicable law. No representation or warranty of
Consumers contained in this Agreement, and no statement or disclosure contained
in the Consumer Disclosure Schedule contains any untrue statement of a material
fact or omits to state a material fact necessary to make such representations,
warranties, statements or disclosures not misleading.
5.19 INSURANCE. Consumers and each of its Subsidiaries are presently
insured, and during each of the past five calendar years has been insured, for
reasonable amounts against such risks as companies engaged in a similar business
would, in accordance with good business practice, customarily be insured. The
policies of fire, theft, banker's blanket bond, liability (including directors
and officers liability insurance) and other insurance maintained with respect to
the assets or businesses
19
of Consumers and its Subsidiaries provide adequate coverage against all pending
or threatened claims, and the fidelity bonds in effect as to which any of
Consumers or any of its Subsidiaries is a named insured are sufficient for their
purpose, except where the failure to have such coverage would not have a
Material Adverse Effect. Such policies are listed and briefly described in
Section 5.19 of the Consumers Disclosure Schedule.
5.20 LABOR. No material work stoppage involving Consumers or its
Subsidiaries is pending or, to the best knowledge of Consumers' management,
threatened. Neither Consumers nor any of its Subsidiaries is involved in, or, to
the best knowledge of Consumers' management threatened with or affected by, any
labor or other employment-related dispute, arbitration, lawsuit or
administrative proceeding which might reasonably be expected to have a Material
Adverse Effect. Employees of Consumers and its Subsidiaries are not represented
by any labor union, and, to the best knowledge of Consumers' management, no
labor union is attempting to organize employees of Consumers or any of its
Subsidiaries.
5.21 MATERIAL INTERESTS OF CERTAIN PERSONS. Except as set forth in the
Consumers Disclosure Schedule, no executive officer or director of Consumers, or
any "associate" (as such term is defined in Rule 14a-1 under the Exchange Act)
of any such executive officer or director, has any material interest in any
material contract or property real or personal, tangible or intangible, used in
or pertaining to the business of Consumers or any of its Subsidiaries.
5.22 REGISTRATION OBLIGATIONS. Neither Consumers nor any of its
Subsidiaries is under any obligation, contingent or otherwise, presently in
effect or which will survive the Merger to register any of its securities under
the Securities Act.
5.23 BROKERS AND FINDERS. Neither Consumers nor any of its Subsidiaries
nor any of their respective officers, directors or employees has employed any
broker or finder or incurred any liability for any financial advisory fees,
brokerage fees, commissions or finder's fees in connection with this Agreement
or the transactions contemplated hereby, except that Consumers has engaged, and
will pay a fee or commission to ▇▇▇▇▇▇ & Co, in accordance with the terms of a
letter agreement between that entity and Consumers, a copy of which is set forth
in Section 5.23 of the Consumers Disclosure Schedule.
5.24 TAKEOVER LAWS. Consumers has taken all steps necessary to
irrevocably exempt the transactions contemplated by this Agreement from any
applicable state or federal takeover law and from any applicable charter or
contractual provision containing change of control or anti-takeover provisions.
5.25 ENVIRONMENTAL MATTERS. Except as set forth in Section 5.25 of the
Consumers Disclosure Schedule, neither Consumers, any of its Subsidiaries, nor
any properties owned or operated by Consumers or any of its Subsidiaries or held
as collateral by any of its Subsidiaries has been or is in violation of or
liable under any Environmental Law (as hereinafter defined) and no properties
owned or leased by Consumers or any of its Subsidiaries or held as collateral by
Consumers or any of its Subsidiaries, while owned or leased by Consumers or any
of the Subsidiary or while held as collateral by Consumers or any of its
Subsidiaries, have been or are in violation of any Environmental Law, except for
such violations or liabilities that, individually or in the aggregate, are not
reasonably
20
likely to have a Material Adverse Effect. There are no actions, suits or
proceedings, or demands, claims, notices or investigations (including without
limitation notices, demand letters or requests for information from any
environmental agency) instituted or pending, or to the best knowledge of
Consumers' management, threatened relating to the liability of any properties
owned, leased or operated by Consumers or any of its Subsidiaries under any
Environmental Law, except for liabilities or violations that would not
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect.
"Environmental Law" means any federal, state, local or foreign law,
statute, ordinance, rule, regulation, code, license, permit, authorization,
approval, consent, order, judgment, decree, injunction or agreement with any
Regulatory Authority relating to (i) the protection. preservation or restoration
of the environment (including, without limitation, air, water vapor, surface
water, groundwater, drinking water supply, surface soil, subsurface soil, plant
and animal life or any other natural resource), and/or (ii) the use, storage,
recycling, treatment, generation, transportation, processing, handling,
labeling, production, release or disposal of any substance presently listed,
defined, designated or classified as hazardous, toxic radioactive or dangerous,
or otherwise regulated, whether by type or by quantity, including any material
containing any such substance as a component.
5.26 SUPPORT OF STOCKHOLDERS. All members of the Consumers Board of
Directors and any Consumers officers who are stockholders have agreed to
actively support the Merger by, among other things, voting in favor of the
Merger at the Stockholders Meeting and not disposing of any Consumers Common
Stock.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES OF BANKUNITED
BankUnited represents and warrants to Consumers as follows:
6.01 ORGANIZATION, STANDING AND AUTHORITY. BankUnited is a corporation
duly organized, validly existing and in good standing under the laws of the
State of Florida. BankUnited is duly qualified to do business and in good
standing in all jurisdictions (whether federal, state, local or foreign) where
its ownership or leasing of property or the conduct of its business requires it
to be so qualified and in which the failure to be duly qualified would have a
material adverse effect on the financial condition, results of operations or
business (the "Condition") of BankUnited and its Subsidiaries on a consolidated
basis or on the ability of BankUnited to consummate the transactions
contemplated hereby ("Material Adverse Effect on BankUnited"). BankUnited has
all requisite corporate power and authority to carry on its business as now
conducted and to own, lease and operate its assets, properties and business, and
to execute and deliver this Agreement and perform the terms of this Agreement.
BankUnited is duly registered as a savings and loan holding company under the
HOLA, BankUnited has in effect all Authorizations necessary for it to own or
lease its properties and assets and to carry on its business as now conducted,
the absence of which, either individually or in the aggregate, would have a
Material Adverse Effect on BankUnited.
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6.02 BANKUNITED CAPITAL STOCK. The authorized capital stock of
BankUnited consists of 33,000,000 shares of BankUnited common stock and
10,000,000 shares of BankUnited Preferred Stock. At June 30, 1997, there were
issued and outstanding 8,869,041 shares of BankUnited common stock and 2,998,688
shares of BankUnited Preferred Stock and no other shares of capital stock of any
class. All of the issued and outstanding shares of BankUnited common stock and
BankUnited Preferred Stock are duly and validly issued and outstanding and are
fully paid and nonassessable.
6.03 SUBSIDIARIES. Section 6.03 of the BankUnited Disclosure Schedule
contains a complete list of BankUnited's Subsidiaries. All of the issued and
outstanding shares of each Subsidiary are owned by BankUnited and no equity
securities are or may become required to be issued by reason of any options,
warrants, scrip, rights to subscribe to, calls or commitments of any character
whatsoever relating to, or securities or rights convertible into or exchangeable
for, shares of any Subsidiary, and there are no contracts, commitments,
understandings or arrangements by which any Subsidiary is bound to issue
additional shares of its capital stock or options, warrants or rights to
purchase or acquire any additional shares of its capital stock. All of the
shares of capital stock of each Subsidiary are fully paid and nonassessable and
are owned free and clear of any Liens. Each Subsidiary (i) is duly organized,
validly existing, and in good standing under the laws of the jurisdiction in
which it is incorporated or organized, (ii) is duly qualified to do business and
in good standing in all jurisdictions (whether federal, state, local or foreign)
where its ownership or leasing of property or the conduct of its business
requires it to be so qualified and in which the failure to be so qualified would
have a Material Adverse Effect on BankUnited, (iii) has all requisite corporate
power and authority to own or lease its properties and assets and to carry on
its business as now conducted and (iv) has in effect all Authorizations
necessary for it to own or lease its properties and assets and to carry on its
business as now conducted, the absence of which Authorizations, individually or
in the aggregate, would have a Material Adverse Effect on BankUnited.
6.04 AUTHORIZATION OF MERGER AND RELATED TRANSACTIONS.
(a) The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby have been duly and
validly authorized by all necessary corporate action in respect thereof
on the part of BankUnited, including approval of the Merger by its Board
of Directors. Stockholder approval is not required. This Agreement,
subject to any requisite regulatory approval hereof with respect to the
Merger and the Subsidiaries Merger, represents a valid and legally
binding obligation of BankUnited, enforceable against BankUnited in
accordance with its terms, except as such enforcement may be limited by
bankruptcy, insolvency, reorganization, moratorium, and similar laws of
general applicability affecting creditors rights generally and by
general principles of equity (whether applied in a proceeding at law or
in equity).
(b) Neither the execution and delivery of this Agreement by
BankUnited, nor the consummation by BankUnited of the transactions
contemplated hereby or thereby nor compliance by BankUnited with any of
the provisions hereof or thereof will (i) conflict with or result in a
breach of any provision of BankUnited's articles of incorporation or
bylaws or (ii) constitute or result in a breach of any term, condition
or provision of, or constitute a default (or an event which with notice
or lapse of time or both would become a default) under, or give rise to
any right of termination, cancellation. or acceleration with respect to,
22
or result in the creation of any Lien upon any property or assets of any
of BankUnited or its Subsidiaries pursuant to any note, bond, mortgage,
indenture, license, agreement, lease or other instrument or obligation
to which any of them is a party or by which any of them or any of their
properties or assets may be subject, and that would, in any such event,
have a Material Adverse Effect on BankUnited or the transactions
contemplated hereby or thereby or (iii) subject to receipt of the
requisite approvals referred to in Section 9.01 of this Agreement,
violate any order, writ, injunction, decree, statute, rule or regulation
applicable to BankUnited or any of its Subsidiaries or any of their
properties or assets.
(c) Other than (i) in connection with complying with the provisions
of applicable state corporate and securities laws, the Securities Act,
the Exchange Act, and the rules and regulations of the SEC or the OTS
promulgated thereunder (the "Securities Laws"), and (ii) consents,
authorizations, approvals or exemptions required from the OTS, no notice
to, filing with, authorization of, exemption by, or consent or approval
of any public body or authority is necessary for the consummation by
Consumers of the Merger and the other transactions contemplated in this
Agreement.
6.05 FINANCIAL STATEMENTS. BankUnited (i) has delivered to Consumers
copies of the consolidated balance sheets and the related consolidated
statements of income, consolidated statements of changes in shareholders' equity
and consolidated statements of cash flows (including related notes and
schedules) of BankUnited and its consolidated Subsidiaries as of and for the
period ended June 30, 1997 included in the quarterly report filed on Form 10-Q,
and for the period ended September 30, 1996 included on an annual report filed
on Form 10-K, as the case may be, filed by BankUnited pursuant to the Securities
Laws (a "BankUnited SEC Document"), and (ii) until the Closing will deliver to
Consumers promptly upon the filing thereof with the SEC copies of the
consolidated balance sheets and related consolidated statements of income,
consolidated statements of changes in shareholders' equity and consolidated
statements of cash flows (including related notes and schedules) included in any
BankUnited SEC Documents filed subsequent to the execution of this Agreement
(clauses (i) and (ii) collectively, the "BankUnited Financial Statements"). The
BankUnited Financial Statements (as of the dates thereof and for the periods
covered thereby) (A) are or will be in accordance with the books and records of
BankUnited and its Consolidated Subsidiaries, which are or will be complete and
accurate in all material respects and which have been or will have been
maintained in accordance with good business practices, and (B) present or will
present fairly the consolidated financial position and the consolidated results
of operations, changes in shareholders' equity and cash flows of BankUnited and
its Subsidiaries as of the dates and for the periods indicated, in accordance
with GAAP, subject in the case of interim financial statements to normal
recurring year-end adjustments and except for the absence of certain footnote
information in the unaudited statements.
6.06 SECURITIES REPORTING DOCUMENTS. Since October 1, 1992, BankUnited
and each of its Subsidiaries has filed on a timely basis all material reports,
schedules, registration statements and definitive proxy statements ("Securities
Reporting Documents"), together with all amendments required to be made with
respect thereto, that they were required to file with (i) the SEC, including
without limitation, all quarterly reports on Form 10-Q, annual reports on Form
10-K, and current reports of Form 8-K, (ii) the OTS, (iii) the FDIC, (iv) any
other applicable state securities or banking authorities (except in the case of
state securities authorities, filings that were not material), and (v)
23
the NASD. No Securities Reporting Document of BankUnited with respect to periods
beginning on or after October 1, 1992 and until the Closing contained or will
contain any information that was false or misleading with respect to any
material fact or omitted or will omit to state any material fact necessary in
order to make the statements therein not misleading and each Securities
Reporting Document of BankUnited contained or will contain all information
required to be stated therein.
6.07 ABSENCE OF UNDISCLOSED LIABILITIES. Neither BankUnited nor any of
its Subsidiaries has any obligations or liabilities (contingent or otherwise) in
the aggregate amount of $630,000 or more, except obligations and liabilities (i)
which are fully accrued or reserved against in the consolidated balance sheet of
BankUnited and its Subsidiaries as of June 30, 1997 included in the BankUnited
Financial Statements or reflected in the notes thereto, or (ii) which were
incurred after June 30, 1997 in the ordinary course of business consistent with
past practice. Since June 30, 1997 neither BankUnited nor any of its
Subsidiaries has incurred or paid any obligation or liability which would have a
Material Adverse Effect on BankUnited.
6.08 ABSENCE OF CERTAIN CHANGES OR EVENTS. Since June 30, 1997, except
as set forth in Section 6.08 of the BankUnited Disclosure Schedule, neither
BankUnited nor any of its Subsidiaries has (A) incurred or paid any liability or
obligation (contingent or otherwise) which individually or in the aggregate had
or is reasonably likely to have a Material Adverse Effect on BankUnited, (B)
suffered any change in its Condition which individually or in the aggregate is
reasonably likely to have a Material Adverse Effect on BankUnited, (C) failed to
operate its business consistent in all material respects with past practice, or
(D) changed any accounting practices.
6.09 COMPLIANCE WITH LAWS.
(a) Each of BankUnited and its Subsidiaries is in compliance with
all laws, rules, regulations, policies, guidelines, reporting and
licensing requirements and orders applicable to its business or to its
employees conducting its business, and with its internal policies and
procedures except for failures to comply which will in the aggregate not
result in a Material Adverse Effect on BankUnited.
(b) Neither BankUnited nor any of its Subsidiaries has received any
notification or communication from any agency or department of any
federal, state or local government, including, the OTS, the FDIC, and
the staffs thereof (collectively, the "Regulatory Authorities") (i)
asserting that any of BankUnited or its Subsidiaries is not in
substantial compliance with any of the statutes, regulations, or
ordinances which such agency, department or Regulatory Authority
enforces, or the internal policies and procedures of such company, (ii)
threatening to revoke any license, franchise, permit or governmental
authorization which is material to the Condition of BankUnited and its
Subsidiaries on a consolidated basis, (iii) requiring or threatening to
require BankUnited or any of its Subsidiaries, or indicating that
BankUnited or any of its Subsidiaries may be required to enter into a
cease and desist order, agreement or memorandum of understanding or any
other agreement restricting or limiting or purporting to restrict or
limit in any manner the operations of BankUnited or any of its
Subsidiaries, including, without limitation, any restriction on the
payment of dividends, or (iv) directing, restricting or limiting, or
purporting to direct, restrict or limit in any manner the operations of
BankUnited or any of its Subsidiaries, including, without limitation,
any
24
restriction on the payment of dividends (any such notice, communication,
memorandum, agreement or order described in this sentence herein
referred to as a "Regulatory Agreement").
(c) Neither BankUnited nor any of its Subsidiaries has consented to
or entered into any Regulatory Agreement or memorandum of understanding.
(d) Neither BankUnited nor any of its Subsidiaries is required by
Section 32 of FDIA to give prior notice to a federal banking agency of
the proposed addition of an individual to its board of directors or the
employment of an individual as a senior executive officer.
6.10 ALLOWANCE FOR LOAN LOSSES. The allowance for loan losses (the
"Allowance") shown on the consolidated statement of condition of BankUnited and
its Subsidiaries as of June 30, 1997 included in the BankUnited Financial
Statements and the Allowance shown on the consolidated statement of condition of
BankUnited and its Subsidiaries, as of dates subsequent to the execution of this
Agreement included in the BankUnited Financial Statements will be, in each case
as of the dates thereof, adequate to provide for losses relating to or inherent
in the loan and lease portfolios (including accrued interest receivables) of
BankUnited and its Subsidiaries; other extensions of credit (including letters
of credit and commitments to make loans or extend credit) by BankUnited and its
Subsidiaries; and the off balance sheet exposures, if any, of BankUnited and its
Subsidiaries.
6.11 STATEMENTS TRUE AND CORRECT. None of the information supplied or to
be supplied by BankUnited for inclusion in the Registration Statement or the
Proxy Statement will, in the case of the Proxy Statement, when it is first
mailed to the stockholders of Consumers contain any untrue statement of a
material fact or omit to state any material fact necessary in order to make the
statements made therein, in light of the circumstances under which such
statements are made, not misleading or, in the case of the Registration
Statement, when it becomes effective, be false or misleading with respect to any
material fact, or omit to state any material fact necessary in order to make the
statements therein not misleading, or in the case of the Proxy Statement or any
amendment thereof or supplement thereto, at the time of the Stockholders'
Meeting, be false or misleading with respect to any material fact or omit to
state any material fact necessary to correct any statement or remedy any
omission in any earlier communication with respect to the solicitation of any
proxy for the Stockholders' Meeting. All documents that BankUnited is
responsible for filing with any Regulatory Authority in connection with the
transactions contemplated hereby will comply as to form in all material respects
with the provisions of applicable law, including applicable provisions of the
Securities Laws.
6.12 CAPITAL STOCK. At the Effective Time, and upon issuance pursuant to
this Agreement the BankUnited Common Stock issued pursuant to the Merger will be
duly authorized, validly issued, fully paid and nonassessable and not subject to
preemptive rights.
6.13 PROPERTIES. Except as disclosed in any Reporting Document filed
since June 30, 1997 and prior to the date hereof and except for Liens arising,
in the ordinary course of business after the date hereof, BankUnited and its
Subsidiaries have good and marketable title, free and clear of all Liens that
are material to the Condition of BankUnited and its Subsidiaries on a
consolidated basis, to all their material properties and assets whether tangible
or intangible, real, personal or mixed,
25
reflected in the BankUnited Financial Statements as being owned by BankUnited
and its Subsidiaries as of the date hereof. All buildings, and all fixtures,
equipment and other property and assets which are material to its business on a
consolidated basis, held under leases or subleases by any of BankUnited or its
Subsidiaries are held under valid instruments enforceable in accordance with
their respective terms, except as such enforcement may be limited by bankruptcy,
insolvency, reorganization, moratorium and similar laws of general applicability
affecting creditors rights generally and by general principles of equity
(whether applied in a proceeding at law or in equity). Substantially all of
BankUnited's and BankUnited's Subsidiaries' equipment in regular use has been
well maintained and is in good serviceable condition, reasonable wear and tear
excepted.
6.14 TAX AND REGULATORY MATTERS. Neither BankUnited nor any of its
Subsidiaries has taken or agreed to take any action or has any knowledge of any
fact or circumstance that would prevent the transactions contemplated hereby,
including the Merger, from qualifying as a reorganization within the meaning of
Section 368 of the Code; or materially impede or delay receipt of any approval
referred to in Section 9.01.
6.15 LITIGATION. There are no judicial proceedings of any kind or nature
pending or, to the knowledge of BankUnited, threatened against BankUnited before
any court or arbitral tribunal or before or by any governmental department,
agency or instrumentality involving the validity of the BankUnited Common Stock,
the transactions contemplated by this Agreement or which would result in a
Material Adverse Effect on BankUnited.
6.16 BROKERS AND FINDERS. Neither BankUnited nor any of its Subsidiaries
nor any of their respective officers, directors or employees has employed any
broker or finder or incurred any liability for any financial advisory fees,
brokerage fees, commissions or finder's fees, and no broker or finder has acted
directly or indirectly for BankUnited or any of its Subsidiaries in connection
with this Agreement or the transactions contemplated hereby.
6.17 MATERIAL CONTRACT DEFAULTS. Neither BankUnited nor any of its
Subsidiaries is, or has received any notice or has any knowledge that any party
is, in default in any respect under any contract, agreement, commitment,
arrangement, lease, insurance policy or other instrument to which BankUnited or
any of its Subsidiaries is a party or by which BankUnited or any of its
Subsidiaries or the assets, business or operations thereof may be bound or
affected or under which it or its respective assets, business or operations
receives benefits, except for those defaults which would not have, individually
or in the aggregate, a Material Adverse Effect on BankUnited; and there has not
occurred any event that with the lapse of time or the giving of notice of both
would constitute such a default. No consent of any party to any contract to
which BankUnited or any of its Subsidiaries is a party is required in connection
with the consummation of the transactions contemplated by this Agreement.
6.18 INSURANCE. BankUnited and each of its Subsidiaries are presently
insured, and during each of the past five calendar years has been insured, for
reasonable amounts against such risks as companies engaged in a similar business
would, in accordance with good business practice, customarily be insured. The
policies of fire, theft, banker's blanket bond, liability (including directors
and officers liability insurance) and other insurance maintained with respect to
the assets or businesses of BankUnited and its Subsidiaries provide adequate
coverage against all pending or threatened
26
claims, and the fidelity bonds in effet as to which any of BankUnited or any of
its Subsidiaries is a named insured are sufficient for their purpose, except
where the failure to have such coverage would not have a Material Adverse Effect
on BankUnited.
ARTICLE VII
CONDUCT OF BUSINESSES PRIOR TO THE EFFECTIVE TIME
7.01 CONDUCT OF BUSINESS PRIOR TO THE EFFECTIVE TIME. During the period
from the date of this Agreement to the Effective Time, Consumers shall, and
shall cause each of its Subsidiaries to, (i) conduct its business in the usual,
regular and ordinary course consistent with past practice (other than
transactions made pursuant to contracts in existence on the date hereof and
described in Sections 7.01 or 7.02 of the Consumers Disclosure Schedule) and
(ii) use its best efforts to maintain and preserve intact its business
organization, employees and advantageous business relationships and retain the
services of its officers and key Employees.
7.02 FORBEARANCES OF CONSUMERS. Except as required by law, regulation or
Regulatory Authorities or as disclosed in the Consumers Disclosure Schedule as
delivered to BankUnited prior to the signing of this Agreement, during the
period from the date of this Agreement to the Effective Time, Consumers shall
not, and shall not permit any of its Subsidiaries to, without the prior written
consent of BankUnited (and Consumers shall provide BankUnited with prompt notice
of any events referred to in this Section 7.02 occurring after the date hereof):
(a) other than in the ordinary course of business consistent with
past practice since December 31, 1996 ("In the Ordinary Course"), incur
any indebtedness for borrowed money, including Federal Home Loan Bank
advances (other than (i) Federal Home Loan Bank advances having
maturities of six months or less and (ii) short-term indebtedness
incurred to refinance short-term indebtedness and indebtedness of
Consumers or any of its Subsidiaries to Consumers or any of its
Subsidiaries) (it being understood and agreed that incurrence of
indebtedness In the Ordinary Course shall include, without limitation,
the creation of deposit liabilities, purchases of federal funds, sales
of certificates of deposit and entering into repurchase agreements),
assume, guarantee, endorse or otherwise as an accommodation become
responsible for the obligations of any other individual, corporation or
other entity, or make any loan or advance other than In the Ordinary
Course.
(b) adjust, split, combine or reclassify any capital stock; make,
declare or pay any dividend or make any other distribution on, or
directly or indirectly redeem, purchase or otherwise acquire, any shares
of its capital stock or any securities or obligations convertible into
or exchangeable for any shares of its capital stock, or grant any stock
appreciation rights or grant any individual, corporation or other entity
any right to acquire any shares of its capital stock; or issue any
additional shares of capital stock, or any securities or obligations
convertible into or exchangeable for any shares of its capital stock.
(c) sell, transfer, mortgage, encumber or otherwise dispose of any
of its properties or assets to any individual, corporation or other
entity, or cancel, release or assign any
27
indebtedness to any such person or any claims held by any such person,
except in the ordinary course of business consistent with past practice
or pursuant to contracts or agreements in force at the date of this
Agreement;
(d) make any material investment either by purchase of stock or
securities, contributions to capital, property transfers, or purchase of
any property or assets of any other individual, corporation or other
entity other than in connection with contracts in existence on the date
hereof and described in Section 7.02 of the Consumers Disclosure
Schedule;
(e) enter into or terminate any contract or agreement involving
annual payments in excess of $20,000 and which cannot be terminated
without penalty upon 30 days notice, or make any change in, or extension
of, any of its leases or contracts involving, annual payments in excess
of $20,000 and which cannot be terminated without penalty upon 30 days
notice;
(f) except as set forth in the Consumers Disclosure Schedule for
severance pay up to $200,000, increase or modify in any manner the
compensation or fringe benefits of any of its Employees or pay any
pension or retirement allowance not required by any existing plan or
agreement to any such Employees, or become a party to, amend or commit
itself to any pension, retirement, profit-sharing or welfare benefit
plan or agreement or employment agreement with or for the benefit of any
Employee other than routine adjustments in compensation and fringe
benefits In the Ordinary Course or accelerate the vesting of any stock
options or other stock-based compensation;
(g) take any action that would prevent or impede the Merger from
qualifying as a reorganization within the meaning of Section 368 of the
Code.
(h) settle any claim, action or proceeding involving the payment of
money damages in excess of $20,000, except In the Ordinary Course;
(i) amend its articles of incorporation or its bylaws;
(j) fail to maintain any Regulatory Agreements, material licenses
and permits or to file in a timely fashion all federal, state, local and
foreign tax returns;
(k) make any capital expenditures of more than $5,000 individually
or $20,000 in the aggregate;
(1) fail to maintain each Consumers Benefit Plan or timely make all
contributions or accruals required thereunder in accordance with GAAP
applied on a consistent basis;
(m) issue any additional shares of Consumers capital stock, except
pursuant to the exercise of Consumers Options by the holders thereof;
(n) agree to, or make any commitment to, take any of the actions
prohibited by this Section 7.02;
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(o) take any action or enter into any contract or agreement
regarding the Falls branch located at ▇▇▇▇ ▇.▇. 136 Street, Miami,
Florida; or
(p) take any action to collect, nor file any collection or
foreclosure proceedings with respect to, any loans with a principal
balance in excess of five hundred thousand dollars ($500,000).
ARTICLE VIII
ADDITIONAL AGREEMENTS
8.01 ACCESS AND INFORMATION.
(a) During the period from the date of this Agreement through the
Effective Time:
(i) Each of Consumers and BankUnited shall, and shall cause its
Subsidiaries to, afford the other, and their respective
accountants, counsel and other representatives, reasonable access
during normal business hours to their respective properties, books,
contracts, tax returns, commitments and records at any time, and
from time to time, for the purpose of conducting any review or
investigation reasonably related to the Merger and the Subsidiaries
Merger, and each of the parties will cooperate fully with all such
reviews and investigations.
(ii) BankUnited shall provide copies of its Securities
Reporting Documents to Consumers and its advisors for purposes of
any review or report to its Board of Directors in evaluating the
Merger.
(b) During the period from the date of this Agreement through the
Effective Time, Consumers shall furnish to BankUnited (i) all Reports
referred to in Section 5.17 promptly upon the filing thereof, (ii) a
copy of each Tax Return filed by it and (iii) monthly and other interim
financial statements in the form prepared by Consumers for its internal
use. During this period, Consumers also shall notify BankUnited promptly
of any material change in the Condition of Consumers or any of its
Subsidiaries.
(c) During the period from the date of this Agreement through the
Effective Time BankUnited shall promptly furnish to Consumers (i) all
BankUnited Financial Statements referred to in Section 6.05(ii), (ii) a
copy of each Tax Return filed by it and (iii) monthly and other interim
financial statements in the form prepared by BankUnited for its internal
use. During this period BankUnited also shall notify Consumers promptly
of any material change in the Condition of BankUnited or any of its
Subsidiaries.
(d) Notwithstanding the foregoing provisions of this Section 8.01,
no investigation by the parties hereto made heretofore or hereafter
shall affect the representations and warranties of the parties which are
contained herein and each such representation and warranty shall survive
such investigation.
29
(e) BankUnited agrees that it will keep confidential for a period
of one year any information furnished to it in connection with the
transactions contemplated by this Agreement which is reasonably
designated as confidential at the time of delivery, except to the extent
that such information (i) was already known to BankUnited and was
received from a source other than Consumers or any of its Subsidiaries,
directors, officers, employees or agents, (ii) thereafter was lawfully
obtained from another source, or (iii) is required to be disclosed by
BankUnited or its agents or representatives to the SEC, the NASD, the
OTS, the FDIC or any other governmental agency or authority, or is
otherwise required to be disclosed by BankUnited or its agents or
representatives by law. BankUnited agrees not to use such information,
and to implement safeguards and procedures that are reasonably designed
to prevent such information from being used, for any purpose other than
in connection with the transactions contemplated by this Agreement.
(f) Consumers shall cooperate, and shall cause its Subsidiaries,
accountants, counsel and other representatives to cooperate, with
BankUnited and its accountants, counsel and other representatives, in
connection with the preparation by BankUnited of any applications and
documents required to obtain the Approvals which cooperation shall
include providing all information, documents and appropriate
representations as may be necessary in connection therewith.
(g) From and after the date of this Agreement, each of BankUnited
and Consumers shall use its reasonable best efforts to satisfy or cause
to be satisfied all conditions to their respective obligations under
this Agreement. While this Agreement is in effect, neither BankUnited
nor Consumers shall take any actions, or omit to take any actions, which
would cause this Agreement to become unenforceable in accordance with
its terms.
8.02 REGISTRATION STATEMENT; REGULATORY MATTERS.
(a) BankUnited shall (i) prepare and file the Registration
Statement with the SEC as soon as is reasonably practicable, (ii) use
its best efforts to cause the Registration Statement to become
effective, and (iii) take any action required to be taken under any
applicable state blue sky or securities laws in connection therewith.
Consumers and its Subsidiaries shall furnish BankUnited with all
information concerning Consumers, its Subsidiaries and the holders of
Consumers Common Stock as BankUnited may reasonably request in
connection with the foregoing.
(b) BankUnited and Consumers shall cooperate and use their
respective best efforts (i) to prepare all documentation, to effect all
filings and to obtain all permits, consents, approvals and
authorizations of all third parties, Regulatory Authorities and other
governmental authorities necessary to consummate the transactions
contemplated by this Agreement, including, without limitation, any such
approvals or authorizations required by the OTS and (ii) to cause the
Merger to be consummated as expeditiously as reasonably practicable.
8.03 STOCKHOLDERS' APPROVAL. Consumers shall use its best efforts to
call a meeting of its stockholders to be held no later than sixty (60) days
after the date this Agreement is executed, for
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the purpose of voting upon the Merger and related matters. The Board of
Directors of Consumers shall submit for approval of its stockholders the matters
to be voted upon at the Stockholders' Meeting, and shall recommend approval of
such matters and use its best efforts (including, without limitation, soliciting
proxies for such approvals) to obtain such stockholder approval. The covenants
under this Section 8.03 are subject to the exercise by the Board of Directors of
Consumers of its fiduciary obligations.
8.04 PRESS RELEASES. Prior to the public dissemination of any press
release or other public disclosure of information about this Agreement, the
Merger or any other transaction contemplated hereby, the parties to this
Agreement shall mutually agree as to the form and substance of such release or
disclosure.
8.05 NOTICE OF DEFAULTS. Consumers and BankUnited shall each promptly
notify the other of (i) any material change in its business, operations or
prospects, (ii) any complaints, investigations or hearings (or communications
indicating that the same may be contemplated) of any Regulatory Authority, (iii)
the institution or the threat of material litigation involving such party, or
(iv) any event or condition that might be reasonably expected to cause any of
its representations, warranties or covenants set forth herein not to be true and
correct in all material respects as of the Effective Time.
8.06 MISCELLANEOUS AGREEMENTS AND CONSENTS; AFFILIATES AGREEMENTS.
Subject to the terms and conditions of this Agreement, each of the parties
hereto agrees to use its respective best efforts to take, or cause to be taken,
all action, and to do, or cause to be done, all things necessary, proper or
advisable under applicable laws and regulations to consummate and make effective
the transactions contemplated by this Agreement as expeditiously as reasonably
practicable, including, without limitation, using their respective best efforts
to lift or rescind any injunction or restraining order or other order adversely
affecting the ability of the parties to consummate the transactions contemplated
hereby. BankUnited and Consumers shall, and shall cause each of their respective
Subsidiaries to, use their best efforts to obtain consents of all third parties
and Regulatory Authorities necessary or, in the reasonable opinion of BankUnited
or Consumers, desirable for the consummation of the transactions contemplated by
this Agreement. In case at any time after the Effective Time any further action
is necessary or desirable to carry out the purposes of this Agreement, the
proper officers and directors of BankUnited shall be deemed to have been granted
authority in the name of Consumers to take all such necessary or desirable
action.
Without limiting the foregoing, Consumers will, at the request of
BankUnited, take such actions, or forbear from taking such actions, as may be
reasonably necessary to identify each of its "affiliates" for purposes of Rule
145 under the Securities Act and to cause each person so identified to deliver
to BankUnited within 10 days after the execution of this Agreement a written
agreement in the form attached hereto as Exhibit C providing that such person
shall not sell, pledge, transfer or otherwise dispose of any capital stock to be
received by such person as part of the Merger Consideration except in compliance
with the applicable provisions of the Securities Act.
8.07 INDEMNIFICATION OF CONSUMERS. For three years after the Effective
Time, BankUnited shall indemnify, defend and hold harmless the present and
former officers, directors, employees and agents of Consumers and its
Subsidiaries (each, an "Indemnified Party") after the
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Effective Time against all losses, expenses, claims, judgments, fines, damages
or liabilities arising out of any claim, action, suit, proceedings or
investigations arising out of any actions or omissions occurring on or prior to
the Effective Time to the full extent then permitted under Florida law.
At or prior to the Effective Time, BankUnited shall purchase $1 million
of directors and officers liability insurance coverage for the Indemnified
Parties with respect to Costs that may be incurred by the Indemnified Parties,
which coverage shall be for a term of three years commencing at the Effective
Time and shall have a deductible of $50,000; provided, however, that in no event
shall BankUnited expend in order to obtain such insurance, an amount in excess
of a total of $15,000 in premiums (the "Maximum Amount") for coverage for such
three year period. If the amount of the total premiums necessary to maintain or
procure such insurance coverage exceeds the Maximum Amount, BankUnited shall use
its reasonable best efforts to maintain the most advantageous policies (in terms
of coverage) of directors and officers insurance for a total three year premium
equal to the Maximum Amount.
If BankUnited or any of its successors or assigns (i) shall consolidate
with or merge into any other corporation or entity and shall not be the
continuing or surviving corporation or entity of such consolidation or merger or
(ii) shall transfer all or substantially all of its properties and assets to any
individual, corporation or other entity, then and in each such case, proper
provision shall be made so that the successors and assigns of the BankUnited
shall assume the obligations set forth in this Section 8.07.
8.08 FALLS BRANCH SUBLEASE. Consumers will use its best efforts to
obtain the consent of NationsBank to the assignment to BankUnited of the
Sublease for the premises.
8.09 STOCK OPTIONS.
(a) Immediately prior to the Effective Time, all rights with
respect to Consumers Common Stock pursuant to stock options ("Consumers
Options") granted by Consumers under the Consumers Benefit Plans, which
are outstanding at the Effective Time, whether or not then exercisable,
shall be cancelled, and each holder of any such option shall be paid for
each such option an amount in cash without interest determined by
multiplying (i) the excess, if any, of $21.33 (subject to adjustment as
provided in Section 10.01(g)) over the applicable exercise price of such
option by (ii) the number of shares of Consumers Common Stock such
holder could have purchased had such holder exercised such option in
full, assuming full vesting of such options, immediately prior to the
Effective Time.
(b) Prior to the Effective Time, Consumers shall (i) obtain any
consents which are necessary from holders of Consumers Options and (ii)
make any amendments to the terms of such option or compensation plans
for arrangements that are necessary to give effect to the transactions
contemplated by Section 8.09(a). Notwithstanding any other provision of
this Section 8.09, payment may be withheld in respect of any Consumers
Option until necessary consents, if any, are obtained.
(c) BankUnited shall be entitled to deduct and withhold from any
Option Payments payable pursuant to this Agreement to any holder of
Consumers Options such
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amounts as BankUnited is required to deduct and withhold with respect to
making such payment under the Code, or any provision of state, local or
foreign tax law. To the extent that amounts are so deducted and withheld
and paid over to the appropriate taxing authority by BankUnited, such
amounts shall be treated for all purposes of this Agreement as having
been paid to the hold of the Consumers Options in respect of which such
deduction and withholding was made by the Surviving Corporation.
(d) Except as provided herein or as otherwise agreed in writing by
the parties, (i) the provisions of the Consumers Stock Plans and any
other plan, program or arrangement pursuant to which Consumers may, or
may be required to, issue stock or stock-based compensation, shall be
terminated by the Effective Time, and (ii) Consumers shall ensure that
following the Effective Time no holder of Consumers Options or any
participant in any Consumers Stock Plan shall have any right thereunder
to acquire any equity securities of Consumers or any of its
Subsidiaries.
(e) Notwithstanding any other provision of this Section 8.09,
nothing shall restrict the ability of holders of Consumers Options to
exercise such options prior to the Effective Time and upon such exercise
to be treated like any other holder of Consumers Common Stock.
8.10 CERTAIN CHANGE OF CONTROL MATTERS. From and after the date hereof,
Consumers shall take all action necessary so that the execution and delivery of
this Agreement will not increase any benefits otherwise payable under any
Consumers Benefit Plan.
8.11 STOCK EXCHANGE LISTING. BankUnited shall use its best efforts to
list, prior to the Effective Time, on the NASDAQ, upon official notice of
issuance, the shares of BankUnited Common Stock to be issued to holders of
Consumers capital stock in the Merger.
8.12 EMPLOYEE BENEFITS.
(a) Consumers shall provide BankUnited in Section 8.12 of the
Consumers Disclosure Schedule the names of all Consumers Employees
(including full and part-time employees) as of the date of the Consumers
Disclosure Schedule (the "Current Employees"), and, as to each Current
Employee, such Current Employee's date of hire, current compensation,
and current severance benefits.
(b) BankUnited and Consumers agree as follows:
(i) BankUnited shall offer, where possible, employment to the
employees of Consumers and its subsidiary following the Effective Time.
As soon as reasonably practicable after the date of this Agreement
BankUnited and Consumers shall consult with each other in order for
BankUnited in its sole discretion to determine which employees of
Consumers will become employees of BankUnited after the Effective Time.
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(ii) All employees of Consumers and their dependents, who are
enrolled in a group health plan made available by Consumers, who would
lose coverage in the event such employee's employment is terminated by
Consumers or BankUnited in connection with the Merger, shall be eligible
for group health coverage, consistent with the requirements of the
Consolidated Omnibus Budget Reconciliation Act ("COBRA") requirements of
the Internal Revenue Code and ERISA, as in effect on the date of such
termination, for the applicable period set forth in the Internal Revenue
Code. BankUnited agrees that any pre-existing condition, limitation or
exclusion in its health plan shall not apply to Continuing Employees or
their covered dependents who are covered under a group health plan
maintained by Consumers and who then change that coverage to the group
health plan coverage offered by BankUnited at the time that such
Continuing Employees are first given the option to enroll in
BankUnited's group health plan.
(iii) All employees who accept employment with BankUnited as of
the Effective Time ("Hired Employees") shall be eligible to participate
in the employee benefit plans and other fringe benefits of BankUnited,
including sickness benefit days and vacation days, on the same terms and
conditions as those provided from time to time by BankUnited to its
similarly situated officers and employees, giving effect, for
eligibility and vesting of benefits, to years of service with Consumers
as if such service were with BankUnited.
(iv) All employees who are not offered employment by BankUnited
shall be entitled to receive payment in lieu of accrued vacation and
sick days, consistent with Consumers past practice and policy.
8.13 CERTAIN ACTIONS. No party shall take any action which would
adversely affect or delay the ability of either BankUnited or Consumers to
obtain any necessary approvals of any Regulatory Authority or other governmental
authority required for the transactions contemplated hereby or to perform its
covenants and agreements under this Agreement. No party shall take any action
that would prevent or impede the Merger from qualifying as a reorganization
within the meaning of Section 368 of the Code.
8.14 ACQUISITION PROPOSALS. Consumers shall not, and shall use its best
efforts to cause its officers, directors and employees and any investment
banker, attorney, accountant, or other agent retained by it or its Subsidiaries
not to (i) initiate, encourage or solicit, directly or indirectly, the making of
any proposal or offer (an "Acquisition Proposal") to acquire all or any
significant part of the business and properties or capital stock of Consumers or
its Subsidiaries, whether by merger, purchase of securities or assets, tender
offer or otherwise (an "Acquisition Transaction"), or initiate, directly or
indirectly, any contact with any person in an effort to or with a view towards
soliciting any Acquisition Proposal or (ii) participate in any discussions or
negotiations regarding, or furnish to any other person any information with
respect to, an Acquisition Proposal. Notwithstanding the foregoing, Consumers
may (i) furnish or cause to be furnished information subject to a
confidentiality agreement similar to that contained in Section 8.01(e) hereof,
(ii) in response to an Acquisition Proposal, issue a communication to its
security holders of the type contemplated by Rule 14d-9(e) under the Exchange
Act, and (iii) participate in discussions and negotiations directly and through
its representatives with persons who have sought the same if, in each instance
the Consumers Board determines, based as to legal matters on the reasonable
advice of outside legal counsel, that the failure
34
to furnish such information or to negotiate with such entity or group or to take
and disclose such position would be inconsistent with the proper exercise of the
fiduciary duties of the Consumers Board. In the event Consumers receives an
Acquisition Proposal or such discussions are sought to be initiated or continued
with Consumers, it shall promptly inform BankUnited as to the material terms
thereof.
8.15 TERMINATION FEE. To compensate BankUnited for entering into this
Agreement, taking action to consummate the transactions hereunder and incurring
the costs and expenses related thereto and other losses and expenses, including
the foregoing by BankUnited of other opportunities, Consumers and BankUnited
agree as follows:
(a) (i) Provided that BankUnited shall not be in material breach of
its obligations under this Agreement (which breach has not been cured
promptly following receipt of written notice thereof by Consumers
specifying in reasonable detail the basis of such alleged breach),
Consumers shall pay to BankUnited the sum of $325,000 (the "Termination
Fee") plus reasonable out-of-pocket expenses, not in excess of $25,000
(including, without limitation, amounts paid or payable to banks and
investment bankers, fees and expenses of counsel, filing fees and
printing expenses) (such expenses are hereinafter referred to as the
"Expenses") incurred by BankUnited or any of its affiliates in
connection with or arising out of transactions contemplated by this
Agreement, regardless of when those expenses are incurred, if this
Agreement is terminated (x) by Consumers: under the provisions of
Section 10.01(f) or as a result of Section 9.02(c), or (y) by BankUnited
under the provisions of 10.01(c), if an Acquisition Event shall occur
after the date hereof and prior to the date that is 9 months after the
date of such termination and as a result of such Acquisition Event
Consumers stockholders shall receive payment in the aggregate that is
valued at more than $11 million (the "Acquisition Price"); provided,
however, that if the Acquisition Price is between $11 million and
$11,325,000, the Termination Fee shall be limited to the excess over $11
million. "Acquisition Event" shall mean any of the following: (i) any
person or group (as defined in Section 13(d)(3) of the Exchange Act),
other than BankUnited, shall have acquired, pursuant to a tender offer,
exchange offer or otherwise, beneficial ownership (including pursuant to
the acquisition of options) of 25% or more of any class of equity
securities of Consumers; (ii) any such person or group shall have
received approval from the OTS to acquire ownership of 25% or more of
any class of equity securities of Consumers; or (iii) Consumers shall
have authorized, recommended, proposed or publicly announced an
intention to authorize, recommend or propose, or shall have entered
into, an agreement with any person (other than BankUnited) to (w) effect
a merger, consolidation, business combination, sale of substantially all
assets, or similar transaction involving Consumers, (x) sell, lease or
otherwise dispose of assets of Consumers representing 25% or more of the
consolidated assets of Consumers, (y) issue, sell or otherwise dispose
of other than by means of a widely disbursed public offering (including
by way of merger, consolidation, share exchange, or any similar
transaction) securities representing 25% or more of any class of equity
securities of Consumers in the aggregate, or (z) have such person effect
a tender offer or exchange offer that if consummated would result in any
person beneficially owning 25% or more of any class of equity securities
of Consumers in the aggregate.
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(ii) If BankUnited terminates this Agreement under the
provisions of Section 10.01(c), and paragraph (a)(i) hereof does not
apply, and BankUnited is not in breach of any representation, warranty
or covenant or other obligation, Consumers shall pay BankUnited, upon
demand, liquidated damages in the amount of $100,000 plus BankUnited's
reasonable out-of-pocket costs incurred in connection with this
transaction, including legal and accounting fees.
(b) Any payment required by paragraph (a) of this Section shall
become payable within five business days after demand therefor by
BankUnited.
(c) Consumers acknowledges that the agreements contained in this
Section 8.15 are an integral part of the transactions contemplated in
this Agreement, and that. without these agreements, BankUnited would not
enter into this Agreement; accordingly, if Consumers fails to promptly
pay the Termination Fee or Expenses or the amounts specified in Section
8.15(a)(ii) when due, Consumers shall in addition thereto pay to
BankUnited all reasonable costs and expenses (including fees and
disbursements of counsel) incurred in collecting such amounts together
with interest on said amounts (or any unpaid portion thereof) from the
date such payment was required to be made until the date such payment is
received by BankUnited at the prime rate of BankUnited, FSB as in effect
from time to time during such period.
8.16 EXPENSES OF CONSUMERS. If Consumers terminates this Agreement
pursuant to Section 10.01(b) or (d) and Consumers is not in breach of any
representation, warranty or covenant or other obligation, BankUnited shall pay
Consumers, upon demand, liquidated damages of $100,000 plus Consumers'
reasonable out-of-pocket costs incurred in connection with this transaction,
including legal and accounting fees (including fees and disbursements incurred
in collecting such amounts).
ARTICLE IX
CONDITIONS
9.01 CONDITIONS TO EACH PARTY'S OBLIGATION TO EFFECT THE MERGER. The
respective obligations of each of BankUnited and Consumers to effect the Merger
and the other transactions contemplated hereby shall be subject to the
fulfillment or waiver at or prior to the Effective Time of the following
conditions:
(a) The stockholders of Consumers shall have approved all matters
relating to the Merger required under applicable law at the
Stockholders' Meeting.
(b) This Agreement, the Merger, the Subsidiaries Merger and the
other transactions contemplated hereby shall have been approved by the
OTS and any other Regulatory Authorities whose approval is required for
consummation of the transactions contemplated hereby, which approvals
are subject to no conditions that in the judgment of BankUnited would
restrict it or its Subsidiaries or affiliates in their respective
spheres of operations and business activities after the Effective Time.
36
(c) The Registration Statement shall have been declared effective
and shall not be subject to a stop order or any threatened stop order.
(d) Neither BankUnited nor Consumers shall be subject to any order,
decree, or injunction of any court or agency of competent jurisdiction,
directing that the consummation of the transactions contemplated by this
Agreement be prohibited or enjoined.
(e) The shares of BankUnited Common Stock issuable pursuant to the
Merger shall have been authorized for trading on the NASDAQ upon
official notice of issuance.
(f) Holders of no more than ten percent of the outstanding capital
stock of Consumers shall have exercised dissenters' rights under Florida
law.
9.02 CONDITIONS TO OBLIGATIONS OF CONSUMERS TO EFFECT THE MERGER. The
obligations of Consumers to effect the Merger shall be subject to the
fulfillment or waiver at or prior to the Effective Time of the following
additional conditions:
(a) The representations and warranties of BankUnited set forth in
Article VI hereof shall be true and correct in all material respects as
of the date of this Agreement and as of the Effective Time (as though
made on and as of the Effective Time except to the extent such
representations and warranties are by their express provisions made as
of a specified date) and Consumers shall have received a certificate
signed by the chairman and chief executive officer, executive vice
president or other duly authorized officer of BankUnited to that effect.
(b) BankUnited shall have performed in all material respects all
obligations required to be performed by it under this Agreement prior to
the Effective Time, and Consumers shall have received a certificate
signed by the chairman and chief executive officer, executive vice
president or other duly authorized officer of BankUnited to that effect.
(c) As of the Effective Time the Closing Net Worth shall be not
less than $6,100,000.
(d) No event, occurrence, or circumstance shall have occurred that
would constitute a Material Adverse Effect as to BankUnited.
(e) Consumers will have received an opinion of counsel mutually
agreed upon by Consumers and BankUnited addressed to Consumers and/or
BankUnited in form reasonably satisfactory to them that for federal
income tax purposes the Merger will qualify as a reorganization under
the provisions of Section 368 of the Code, and that the conversion of
Consumers Common Stock solely into BankUnited Common Stock will be
treated as a tax free exchange.
(f) The fair market value of BankUnited Common Stock shall not be
less than $8.50, as determined by using the average of the mean of the
closing prices of such stock as
37
quoted on the NASDAQ system on each of the ten (10) trading days
immediately preceding the Effective Time.
9.03 CONDITIONS TO OBLIGATIONS OF BANKUNITED TO EFFECT THE MERGER. The
obligations of BankUnited to effect the Merger shall be subject to the
fulfillment or waiver at or prior to the Effective Time of the following
additional conditions:
(a) The representations and warranties of Consumers set forth in
Article V hereof shall be true and correct in all material respects as
of the date of this Agreement as of the Effective Time (as though made
on and as of the Effective Time except to the extent such
representations and warranties are by their express provisions made as
of a specified date) and BankUnited shall have received a certificate
signed by the chairman or the chief executive officer or other duly
authorized officer of Consumers to that effect.
(b) Consumers shall have performed in all material respects all
obligations required to be performed by it under this Agreement prior to
the Effective Time, and BankUnited shall have received a certificate
signed by the chairman or the chief executive officer or other duly
authorized officer of Consumers to that effect.
(c) As of the Effective Time the Closing Net Worth shall be not
less than $6,500,000.
(d) BankUnited will receive an opinion of counsel for Consumers
addressed to BankUnited and in form satisfactory to it as to the
validity of the approvals of the Merger by the directors and
stockholders of Consumers.
(e) No event, occurrence, or circumstance shall have occurred that
would constitute a Material Adverse Effect as to Consumers.
(f) BankUnited will receive an opinion of counsel mutually agreed
upon by BankUnited and Consumers addressed to BankUnited and/or
Consumers in form reasonably satisfactory to them that for federal
income tax purposes the Merger will qualify as a reorganization under
the provisions of Section 368 of the Code, that the conversion of
Consumers Common Stock solely into BankUnited Common Stock will be a tax
free exchange, that the BankUnited Common Stock to be issued in the
Merger has been registered with the SEC, and that to their best
knowledge such registration is in full force and effect and not subject
to a stop order.
ARTICLE X
TERMINATION
10.01 TERMINATION. Notwithstanding any other provision of this
Agreement, and notwithstanding the approval of this Agreement, the Merger and
the other transactions contemplated
38
hereby by the stockholders of BankUnited and Consumers or both, this Agreement
may be terminated and the Merger abandoned at any time prior to the Effective
Time:
(a) by mutual consent of the Board of Directors of BankUnited and
the Board of Directors of Consumers; or
(b) by the Board of Directors of BankUnited or the Board of
Directors of Consumers if (i) the OTS has denied approval of the Merger
and such denial has become final and nonappealable or has approved the
Merger subject to conditions that in the judgment of BankUnited would
restrict it or its Subsidiaries or affiliates in their respective
spheres of operations and business activities after the Effective Time
or (ii) the Effective Time does not occur by March 15, 1998, unless
mutually extended by the parties; or
(c) by BankUnited (if it is not in material breach of any of its
obligations hereunder) pursuant to notice in the event of a breach or
failure by Consumers that is material in the context of the transactions
contemplated hereby of any representation, warranty, covenant or
agreement by Consumers contained herein which has not been, or cannot
be, cured within 30 days after written notice of such breach is given to
Consumers; or
(d) by Consumers (if it is not in material breach of any of its
obligations hereunder) pursuant to notice in the event of a breach or
failure by BankUnited that is material in the context of the
transactions contemplated hereby of any representation, warranty,
covenant or agreement by BankUnited contained herein which has not been,
or cannot be, cured within 30 days after written notice of such breach
is given to BankUnited; or
(e) by either party if the stockholders of Consumers fail to
approve the Merger at the Stockholder's Meeting; or
(f) by Consumers if (i) there shall not have been a material breach
of any covenant or agreement on the part of Consumers under this
Agreement and (ii) prior to the Effective Time, a corporation,
partnership, person or other entity or group shall have made a bona fide
Acquisition Proposal that the Consumers Board determines in its good
faith judgment and in the exercise of its fiduciary duties, based as to
legal matters on the reasonable advice of legal counsel and as to
financial matters on the reasonable advice of an investment banking firm
of national reputation, is more favorable to the Consumers stockholders
than the Merger and that the failure to terminate this Agreement and
accept such alternative Acquisition Proposal would be inconsistent with
the proper exercise of such fiduciary duties; provided, however, that
termination under this clause (ii) shall not be deemed effective until
payment of the Termination Fee required by Section 8.15.
(g) If the Closing Net Worth is less than $6,500,000, then
at BankUnited's option, it may either terminate this Agreement, or
proceed to consummate the Merger by reducing the aggregate Merger
Consideration to be paid to holders of Consumers stock and the amounts
to be paid to holders of Consumers stock options by $1.25 for each
dollar that the Closing Net Worth is less than $6,500,000.
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10.02 [INTENTIONALLY OMITTED.]
10.03 EFFECT OF TERMINATION. In the event of the termination and
abandonment of this Agreement pursuant to Sections 10.01 or 10.02, this
Agreement shall become void and have no effect, except that (i) the provisions
of Section 8.01(e), 8.15, 10.03 and Section 11.01 shall survive any such
termination and abandonment, and (ii) no party shall be relieved or released
from any liability arising out of an intentional breach of any provision of this
Agreement.
10.04 SURVIVAL OF REPRESENTATIONS, WARRANTIES AND COVENANTS FOLLOWING
THE EFFECTIVE TIME. The parties hereto agree that none of the respective
representations, warranties, obligations, covenants and agreements of the
parties contained in this Agreement except for Sections 8.01(e), 8.15 and 8.16,
or in any certificate, document or instrument delivered in connection herewith,
shall survive the Effective Time, regardless of any investigation made by the
parties hereto.
ARTICLE XI
GENERAL PROVISIONS
11.01 EXPENSES. Unless otherwise agreed by the parties in writing, each
party hereto shall bear its own expenses incident to preparing, entering into
and carrying out this Agreement and to consummating the Merger, except that
BankUnited and Consumers shall divide equally all printing expenses and filing
fees incurred in connection with this Agreement, the Registration Statement and
the Proxy Statement.
11.02 ENTIRE AGREEMENT. Except as otherwise expressly provided herein,
this Agreement contains the entire agreement between the parties hereto with
respect to the transactions contemplated hereunder and thereunder, and such
agreements supersede all prior arrangements or understandings with respect
thereto, written or oral. The terms and conditions of this Agreement shall inure
to the benefit of and be binding upon the parties hereto and their respective
successors. Other than as expressly set forth in this Agreement, nothing in this
Agreement, expressed or implied, is intended to confer upon any individual,
corporation or other entity, other than BankUnited, Consumers and the Resulting
Institution, or their respective successors, any rights, remedies, obligations
or liabilities under or by reason of this Agreement.
11.03 AMENDMENTS. To the extent permitted by law, this Agreement may be
amended by a subsequent writing signed by each of BankUnited and Consumers;
provided, however, that the provisions hereof relating to the manner or basis in
which shares of Consumers capital stock will be exchanged for the Merger
Consideration shall not be amended after the Stockholders' Meeting without any
requisite approval of the holders of the issued and outstanding shares of
Consumers capital stock entitled to vote thereon.
11.04 WAIVERS. Prior to or at the Effective Time, each of BankUnited and
Consumers shall have the right to waive any default in the performance of any
term of this Agreement by the other, to waive or extend the time for the
compliance or fulfillment by the other of any and all of the
40
other's obligations under this Agreement and to waive any or all of the
conditions precedent to its obligations under this Agreement, except any
condition which, if not satisfied, would result in the violation of any law or
applicable governmental regulation.
11.05 NO ASSIGNMENT. None of the parties hereto may assign any of its
rights or delegate any of its obligations under this Agreement to any other
person or entity. Any such purported assignment or delegation that is made
without the prior written consent of the other parties to this Agreement shall
be void and of no effect.
11.06 NOTICES. All notices or other communications which are required or
permitted hereunder shall be in writing and sufficient if delivered by hand
(including overnight delivery service), or by registered or certified mail,
postage prepaid to the persons at the addresses set forth below (or at such
other address as may be provided hereunder), and shall be deemed to have been
delivered as of the date so delivered:
Consumers: Consumers Bancorp, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ - ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇, Chairman of the Board
and Chief Executive Officer
Copy to Counsel: ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇. - ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇, Esq.
BankUnited: BankUnited Financial Corporation
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Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Chairman of the Board
and President
▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Chief Financial
Officer
Copy to Counsel: Stuzin and Camner, P.A.
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Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
11.07 SPECIFIC PERFORMANCE. The parties hereby acknowledge and agree
that the failure of either party to fulfill any of its covenants and agreements
hereunder, including the failure to take all such actions as are necessary on
its part to cause the consummation of the Merger, will cause irreparable injury
for which damages, even if available, will not be an adequate remedy.
Accordingly,
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each party hereby consents to the issuance of injunctive relief by any court of
competent jurisdiction to compel performance of the other party's obligations or
any arbitration award hereunder and to the granting by any such court of the
remedy of the specific performance hereunder.
11.08 GOVERNING LAW. This Agreement shall in all respects be governed by
and construed in accordance with the laws of the State of Florida.
11.09 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to constitute an original, but all
of which together shall constitute one and the same instrument.
11.10 CAPTIONS. The captions contained in this Agreement are for
reference purposes only and are not part of this Agreement.
11.11 SEVERABILITY. In the event that any one or more of the provisions
contained in this Agreement, or in any other instrument referred to herein,
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 or any other such instrument.
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IN WITNESS WHEREOF, BankUnited and Consumers have caused this Agreement
to be signed by their respective officers thereunto duly authorized, all as of
the date first written above.
BANKUNITED FINANCIAL CORPORATION
By:
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Chairman of the Board and President
CONSUMERS BANCORP, INC.
By:
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Chairman of the Board and
Chief Executive Officer
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EXHIBIT C
Rule 145 Affiliate Agreement
Pursuant to Section 8.06
of the Agreement and Plan of Merger
Name (please print) __________________
August ___, 1997
BankUnited Financial Corporation
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Dear Madam or Sir:
This letter is delivered to you in compliance with Section 8.06 of the
Agreement and Plan of Merger, dated August __, 1997 (the "Agreement"), between
BankUnited Financial Corporation ("BankUnited") and Consumers Bancorp, Inc.
("Consumers"), providing for the merger (the "Merger") of Consumers with and
into BankUnited.
1. The undersigned represents and warrants to you that the shares of
Class A Common Stock of BankUnited (the "BankUnited Stock"), which the
undersigned shall receive in exchange for shares of common stock of Consumers,
are not being acquired by the undersigned with a view to their distribution
except to the extent and in the manner provided for in paragraph (d) of Rule 145
under the Securities Act of 1933, as amended (the "Act"). The undersigned agrees
that the undersigned will not sell, transfer or otherwise dispose of any shares
of BankUnited Stock to be received by the undersigned in connection with the
Merger unless (i) such sale, transfer, or other disposition has been registered
under this Act, (ii) such sale, transfer, or other disposition is made in
conformity with the volume and other applicable limitations of Rule 145 under
the Act, or (iii) the undersigned at the undersigned's expense delivers to
BankUnited an opinion of counsel in form and substance reasonably satisfactory
to BankUnited to the effect that the proposed transfer of BankUnited Stock does
not violate the federal securities laws.
2. The undersigned acknowledges that to the extent the undersigned
believed necessary, the undersigned discussed this letter and any applicable
limitations upon the resale of BankUnited Stock with either counsel for
undersigned or counsel for Consumers. The undersigned agrees that BankUnited may
place the legend set forth below on the certificate or certificates for any or
all BankUnited Stock to be received by the undersigned in connection with the
Merger and may file stop-transfer instructions with respect to such shares with
the transfer agent for such shares. The undersigned understands that the legend
set forth on the certificate or certificates for BankUnited Stock to be received
by the undersigned shall be removed as well as the related stop-transfer
instructions when such restrictions are no longer applicable to such shares.
3. Pursuant to the provisions of the preceding paragraph, the
certificate or certificates evidencing BankUnited Stock received by the
undersigned may bear the following legend:
"THE SHARES REPRESENTED BY THIS CERTIFICATE WERE
ISSUED IN A TRANSACTION TO WHICH RULE 145
PROMULGATED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, APPLIES. NO TRANSFER OF SUCH SHARES
SHALL BE VALID OR EFFECTIVE UNTIL THE CONDITIONS
OF SUCH RULE HAVE BEEN FULFILLED."
Very truly yours,
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Signature