AGREEMENT AND PLAN OF REORGANIZATION
BY AND BETWEEN
PREMIER BANCSHARES, INC.
AND
NORTH ▇▇▇▇▇▇ BANCSHARES, INC.
Dated as of April 6, 1999
TABLE OF CONTENTS
Page
----
Preamble...................................................................... 1
ARTICLE I
TRANSACTIONS AND TERMS OF MERGER......................................... 1
--------------------------------
Merger................................................................... 1
Time and Place of Closing................................................ 2
Effective Time........................................................... 2
Execution of Support Agreements.......................................... 2
ARTICLE II
TERMS OF MERGER.......................................................... 2
---------------
Articles of Incorporation................................................ 2
Bylaws................................................................... 2
Directors and Officers................................................... 2
ARTICLE III
MANNER OF CONVERTING SHARES.............................................. 3
---------------------------
Conversion of Shares..................................................... 3
Anti-Dilution Provisions................................................. 3
Shares Held by Premier or North ▇▇▇▇▇▇................................... 4
Conversion of Stock Options; Restricted Stock............................ 4
Dissenting Shareholders.................................................. 4
Fractional Shares........................................................ 5
ARTICLE IV
EXCHANGE OF SHARES....................................................... 5
------------------
Exchange Procedures...................................................... 5
Rights of Former North ▇▇▇▇▇▇ Shareholders............................... 6
ARTICLE V
REPRESENTATIONS AND WARRANTIES
------------------------------
OF NORTH ▇▇▇▇▇▇.......................................................... 6
---------------
Organization, Standing, and Power........................................ 6
Authority; No Breach By Agreement........................................ 7
Common Stock............................................................. 8
North ▇▇▇▇▇▇ Subsidiaries................................................ 8
Financial Statements..................................................... 9
Absence of Undisclosed Liabilities....................................... 9
Absence of Certain Changes or Events..................................... 9
Tax Matters..............................................................10
(i)
AGREEMENT AND PLAN OF REORGANIZATION
------------------------------------
THIS AGREEMENT AND PLAN OF REORGANIZATION (this "Agreement") is made and
entered into as of April 6, 1999 by and between PREMIER BANCSHARES, INC.
("Premier"), a corporation organized and existing under the laws of the State of
Georgia, with its principal office located in Atlanta, Georgia, and NORTH ▇▇▇▇▇▇
BANCSHARES, INC. ("North ▇▇▇▇▇▇"), a corporation organized and existing under
the laws of the State of Georgia, with its principal office located in Roswell,
Georgia.
Preamble
---------
The Boards of Directors of Premier and North ▇▇▇▇▇▇ are of the opinion that
the transactions described herein are in the best interests of the parties and
their respective shareholders. This Agreement provides for the merger of North
▇▇▇▇▇▇ with and into Premier, with Premier being the surviving corporation of
the merger. At the effective time of such merger, the outstanding shares of
capital stock of North ▇▇▇▇▇▇ will be converted into the right to receive shares
of capital stock of Premier. As a result, shareholders of North ▇▇▇▇▇▇ will
become shareholders of Premier, and the wholly-owned subsidiary of North ▇▇▇▇▇▇,
▇▇▇▇▇▇ National Bank, will continue to conduct its business and operations as a
wholly-owned subsidiary of Premier. The transactions described in this
Agreement are subject to the approvals of the Boards of Directors of both
Premier and North ▇▇▇▇▇▇, the shareholders of North ▇▇▇▇▇▇, the Board of
Governors of the Federal Reserve System, the Georgia Department of Banking and
Finance and the satisfaction of certain other conditions described in this
Agreement. It is the intention of the parties to this Agreement that the merger
(i) for federal income tax purposes shall qualify as a "reorganization" within
the meaning of Section 368(a) of the Internal Revenue Code and (ii) for
accounting purposes shall be accounted for as a "pooling of interests."
As a condition and inducement to Premier's willingness to consummate the
transactions contemplated by this Agreement, each of the directors of North
▇▇▇▇▇▇ will execute and deliver to Premier an agreement (a "Support Agreement")
within ten (10) calendar days of the date of this Agreement, in substantially
the form of Exhibit 6 to this Agreement.
---------
Certain terms used in this Agreement are defined in Section 11.1 of this
Agreement.
NOW, THEREFORE, in consideration of the above and the mutual warranties,
representations, covenants and agreements set forth herein, the receipt and
legal sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
ARTICLE I
TRANSACTIONS AND TERMS OF MERGER
--------------------------------
1.1 Merger. Subject to the terms and conditions of this Agreement, at
------
the Effective Time, North ▇▇▇▇▇▇ shall be merged with and into Premier in
accordance with the provisions of
Section 14-2-1101, 14-2-1103, and 14-2-1105 of the GBCC and with the effect
provided in Section 14-2-1106 of the GBCC (the "Merger"). Premier shall be the
Surviving Corporation resulting from the Merger. The Merger shall be consummated
pursuant to the terms of this Agreement, which has been approved and adopted by
the respective Boards of Directors of Premier and North ▇▇▇▇▇▇.
1.2 Time and Place of Closing. The Closing will take place at 10:00
-------------------------
a.m. on the date that the Effective Time occurs (or the immediately preceding
day if the Effective Time is earlier than 10:00 a.m.), or at such other time as
the Parties, acting through their chief executive officers may mutually agree.
The place of Closing shall be at the offices of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ & ▇▇▇▇,
PLLC, Atlanta, Georgia, or such other place as may be mutually agreed upon by
the Parties.
1.3 Effective Time. The Merger and the other transactions contemplated
--------------
by this Agreement shall become effective on the date and at the time the
Articles of Merger reflecting the Merger shall become effective with the
Secretary of State of the State of Georgia (the "Effective Time"). Subject to
the terms and conditions hereof, unless otherwise mutually agreed upon in
writing by the chief executive officer of each Party, the Parties shall use
their reasonable efforts to cause the Effective Time to occur on the last
business day of the month in which occurs the last to occur of (a) the effective
date (including expiration of any applicable waiting period) of the last
required Consent of any Regulatory Authority having authority over and approving
or exempting the Merger, (b) the date on which the shareholders of North ▇▇▇▇▇▇
approve this Agreement to the extent such approval is required by applicable
Law; or such later date as may be mutually agreed upon in writing by the chief
executive officer of each Party.
1.4 Execution of Support Agreements. Within ten (10) calendar days of
-------------------------------
the execution of this Agreement and as a condition hereto, each of the directors
of North ▇▇▇▇▇▇ will execute and deliver to premier a Support Agreement, in
substantially the form of Exhibit 6 to this Agreement.
---------
ARTICLE II
TERMS OF MERGER
---------------
2.1 Articles of Incorporation. The Articles of Incorporation of Premier
-------------------------
in effect immediately prior to the Effective Time shall be the Articles of
Incorporation of the Surviving Corporation from and after the Effective Time
until otherwise amended or repealed.
2.2 Bylaws. The Bylaws of Premier in effect immediately prior to the
------
Effective Time shall be the Bylaws of the Surviving Corporation from and after
the Effective Time until otherwise amended or repealed.
2.3 Directors and Officers.
----------------------
(a) The officers and directors of the Surviving Corporation from and
after the Effective Time shall consist of the officers and directors of Premier
immediately preceding the
2
Effective Time, together with such additional persons as may thereafter be
elected; provided, however, that Premier shall select one (1) of the current
directors of North ▇▇▇▇▇▇ listed in paragraph (c) below to serve on the board of
directors of the Surviving Corporation from and after the Effective Date. Such
officers and directors shall serve in accordance with the Articles of
Incorporation and Bylaws of the Surviving Corporation.
(b) The directors of Premier Bank from and after the Effective Time
shall consist of the directors of Premier Bank immediately preceding the
Effective Time, provided, however, that upon the consummation of a proposed
merger of ▇▇▇▇▇▇ National Bank with and into Premier Bank, Premier shall elect
one of the directors of ▇▇▇▇▇▇ National Bank, as of the Effective Time, to the
Board of Directors of Premier Bank. Such directors shall serve in accordance
with the Articles of Incorporation and Bylaws of Premier Bank.
(c) The directors of ▇▇▇▇▇▇ National Bank from and after the
Effective Time shall consist of L. ▇▇▇▇▇ ▇▇▇▇, H. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, together with such additional persons as Premier,
in its sole discretion, may designate. Such directors shall serve in accordance
with the Articles of Association and Bylaws of ▇▇▇▇▇▇ National Bank.
ARTICLE III
MANNER OF CONVERTING SHARES
---------------------------
3.1 Conversion of Shares. Subject to the provisions of this Article 3,
--------------------
at the Effective Time, by virtue of the Merger and without any action on the
part of Premier or North ▇▇▇▇▇▇, or the shareholders of either of the foregoing,
the shares of the constituent corporations shall be converted as follows:
(a) Each share of Premier Common Stock issued and outstanding
immediately prior to the Effective Time shall remain issued and outstanding from
and after the Effective Time.
(b) Each share of North ▇▇▇▇▇▇ Common Stock (excluding shares held
by Premier or North ▇▇▇▇▇▇ or any of their respective Subsidiaries, in each case
other than in a fiduciary capacity or as a result of debts previously
contracted) issued and outstanding at the Effective Time shall cease to be
outstanding and shall be converted into and exchanged for the right to receive
0.8749 shares of Premier Common Stock (the "Exchange Ratio").
3.2 Anti-Dilution Provisions. In the event Premier or North ▇▇▇▇▇▇
------------------------
changes the number of shares of Premier Common Stock or North ▇▇▇▇▇▇ Common
Stock, respectively, issued and outstanding prior to the Effective Time as a
result of a stock split, stock dividend or similar recapitalization with respect
to such stock and the record date therefor (in the case of a stock dividend) or
the effective date therefor (in the case of a stock split or similar
recapitalization) shall be after the date hereof and prior to the Effective
Time, the Exchange Ratio shall be proportionately adjusted.
3
3.3 Shares Held by Premier or North ▇▇▇▇▇▇. Each of the shares of North
--------------------------------------
▇▇▇▇▇▇ Common Stock held by any Premier Company or by any North ▇▇▇▇▇▇ Company,
in each case other than in a fiduciary capacity or as a result of debts
previously contracted, shall be canceled and retired at the Effective Time and
no consideration shall be issued in exchange therefor.
3.4 Conversion of Stock Options; Restricted Stock.
---------------------------------------------
(a) At the Effective Time, all rights with respect to North ▇▇▇▇▇▇
Common Stock pursuant to stock options granted by North ▇▇▇▇▇▇ under the North
▇▇▇▇▇▇ Stock Plans ("North ▇▇▇▇▇▇ Options"), which are outstanding at the
Effective Time, whether or not exercisable, shall be converted into and become
rights with respect to Premier Common Stock, and Premier shall assume each North
▇▇▇▇▇▇ Option, in accordance with the terms of the North ▇▇▇▇▇▇ Stock Plan and
stock option agreement by which it is evidenced. From and after the Effective
Time, (i) each North ▇▇▇▇▇▇ Option assumed by Premier may be exercised solely
for shares of Premier Common Stock, (ii) the number of shares of Premier Common
Stock subject to such North ▇▇▇▇▇▇ Option shall be equal to the number of shares
of North ▇▇▇▇▇▇ Common Stock subject to such North ▇▇▇▇▇▇ Option immediately
prior to the Effective Time multiplied by the Exchange Ratio, and (iii) the per
share exercise price under each such North ▇▇▇▇▇▇ Option shall be adjusted to
reflect the Exchange Ratio. It is intended that the foregoing assumption shall
be undertaken in a manner that will not constitute a "modification" as defined
in Section 424 of the Internal Revenue Code, as to any stock option which is an
"incentive stock option." North ▇▇▇▇▇▇ and Premier agree to take all necessary
steps to effect the provisions of this Section 3.4.
(b) Premier may, at its election, substitute, as of the Effective
Time, stock options under the Premier Bancshares, Inc. 1997 Stock Option Plan
(the "Premier Stock Option Plan") for all or a part of the North ▇▇▇▇▇▇ Options,
subject to the following conditions: (i) the requirements of Section 3.4(a)
shall be met; (ii) such substitution shall not constitute a modification,
extension or renewal of any of the North ▇▇▇▇▇▇ Options which are incentive
stock options; (iii) the substituted options shall continue in effect in all
material respects on the same terms and conditions as contained in the document
granting the North ▇▇▇▇▇▇ Options; and (iv) each grant of a substitute option to
any individual who shall be deemed subject to Section 16 of the 1934 Act shall
have been specifically approved in advance by the full Board of Directors of
Premier or by a committee consisting solely of "non-employee" directors as
defined in Rule 16b-3. As soon as practicable following the Effective Time,
Premier shall deliver to the participants receiving substitute options under the
Premier Stock Option Plan an appropriate notice setting forth such participant's
rights pursuant thereto. Premier has reserved under the Premier Stock Option
Plan adequate shares of Premier Common Stock for delivery upon exercise of any
such substituted options.
3.5 Dissenting Shareholders. Any holder of shares of North ▇▇▇▇▇▇
-----------------------
Common Stock who perfects such holder's dissenters' rights of appraisal in
accordance with and as contemplated by Article 13 of the GBCC shall be entitled
to receive the value of such shares in cash as determined pursuant to such
provision of the GBCC; provided, that no such payment shall be made to any
4
dissenting shareholder unless and until such dissenting shareholder has complied
with the applicable provisions of the GBCC and has surrendered to Premier the
certificate or certificates representing shares for which payment is being made.
In the event that after the Effective Time a dissenting shareholder of North
▇▇▇▇▇▇ fails to perfect, or effectively withdraws or loses, such holder's right
to appraisal and of payment for such holder's shares, Premier shall issue and
deliver the consideration to which such holder of shares of North ▇▇▇▇▇▇ Common
Stock is entitled under this Article III (without interest) upon surrender by
such holder of the certificate or certificates representing shares of North
▇▇▇▇▇▇ Common Stock held by such holder.
3.6 Fractional Shares. Notwithstanding any other provision of this
-----------------
Agreement, each holder of shares of North ▇▇▇▇▇▇ Common Stock exchanged pursuant
to the Merger, or of options to purchase shares of North ▇▇▇▇▇▇ Common Stock,
who would otherwise have been entitled to receive a fraction of a share of
Premier Common Stock (after taking into 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 Premier Common Stock
multiplied by the market value of one share of Premier Common Stock at the
Effective Time, in the case of shares exchanged pursuant to the Merger, or the
date of exercise, in the case of options. The market value of one share of
Premier Common Stock at the Effective Time or the date of exercise, as the case
may be, shall be the last sale price of such common stock on the American Stock
Exchange (as reported by The Wall Street Journal or, if not reported thereby,
any other authoritative source) on the last trading day preceding the Effective
Time or the date of exercise, as the case may be. No such holder will be
entitled to dividends, voting rights, or any other rights as a stockholder in
respect of any fractional shares.
ARTICLE IV
EXCHANGE OF SHARES
------------------
4.1 Exchange Procedures. Promptly after the Effective Time, Premier and
-------------------
North ▇▇▇▇▇▇ shall cause the exchange agent selected by Premier (the "Exchange
Agent") to mail to the former holders of North ▇▇▇▇▇▇ Common Stock appropriate
transmittal materials (which shall specify that delivery shall be effected, and
risk of loss and title to the certificates theretofore representing shares of
North ▇▇▇▇▇▇ Common Stock shall pass, only upon proper delivery of such
certificates to the Exchange Agent). After the Effective Time, each holder of
shares of North ▇▇▇▇▇▇ Common Stock (other than shares to be canceled pursuant
to Section 3.3 of this Agreement or shares as to which dissenters' rights have
been perfected as provided in Section 3.5 of this Agreement) issued and
outstanding at the Effective Time, shall surrender the certificate or
certificates representing such shares to the Exchange Agent and shall promptly
upon surrender thereof receive in exchange therefor the consideration provided
in Section 3.1 and 3.6 of this Agreement, together with all undelivered
dividends or distributions in respect of such shares (without interest thereon)
pursuant to Section 4.2 of this Agreement. Neither Premier nor the Exchange
Agent shall be obligated to deliver the consideration to which any former holder
of North ▇▇▇▇▇▇ Common Stock is entitled as a result of the Merger until such
holder surrenders his or her certificate or certificates representing the shares
of North ▇▇▇▇▇▇ Common Stock for exchange as provided in this Section 4.1. The
certificate or
5
certificates of North ▇▇▇▇▇▇ Common Stock so surrendered shall be duly endorsed
as Premier may require. Any other provision of this Agreement notwithstanding,
neither Premier nor the Exchange Agent shall be liable to a holder of North
▇▇▇▇▇▇ Common Stock for any amounts paid or property delivered in good faith to
a public official pursuant to any applicable abandoned property Law.
4.2 Rights of Former North ▇▇▇▇▇▇ Shareholders. The stock transfer
------------------------------------------
books of North ▇▇▇▇▇▇ shall be closed as to holders of North ▇▇▇▇▇▇ Common Stock
immediately prior to the Effective Time and no transfer of North ▇▇▇▇▇▇ Common
Stock by any such holder shall thereafter be made or recognized. Until
surrendered for exchange in accordance with the provisions of Section 4.1 of
this Agreement, each certificate theretofore representing shares of North ▇▇▇▇▇▇
Common Stock (other than shares to be canceled pursuant to Section 3.3 or shares
as to which dissenters' rights have been perfected as provided in Section 3.5 of
this Agreement) shall from and after the Effective Time represent for all
purposes only the right to receive the consideration provided in Section 3.1 and
3.6 of this Agreement in exchange therefor. To the extent permitted by Law,
former holders of record of North ▇▇▇▇▇▇ Common Stock shall be entitled to vote
after the Effective Time at any meeting of Premier shareholders the number of
whole shares of Premier Common Stock into which their respective shares of North
▇▇▇▇▇▇ Common Stock are converted, regardless of whether such holders have
exchanged their certificates representing North ▇▇▇▇▇▇ Common Stock for
certificates representing Premier Common Stock in accordance with the provisions
of this Agreement. Whenever a dividend or other distribution is declared by
Premier on the Premier Common Stock, the record date for which is at or after
the Effective Time, the declaration shall include dividends or other
distributions on all shares issuable pursuant to this Agreement, but no dividend
or other distribution payable to the holders of record of Premier Common Stock
as of any time subsequent to the Effective Time shall be delivered to the holder
of any certificate representing shares of North ▇▇▇▇▇▇ Common Stock issued and
outstanding at the Effective Time until such holder surrenders such certificate
for exchange as provided in Section 4.1 of this Agreement. However, upon
surrender of such North ▇▇▇▇▇▇ Common Stock certificate, both Premier Common
Stock certificate (together with all such undelivered dividends or other
distributions without interest) and any undelivered cash payments to be paid for
fractional share interests (without interest) shall be delivered and paid with
respect to each share represented by such certificate.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
------------------------------
OF NORTH ▇▇▇▇▇▇
---------------
North ▇▇▇▇▇▇ hereby represents and warrants to Premier as follows:
5.1 Organization, Standing, and Power. North ▇▇▇▇▇▇ is a corporation
---------------------------------
duly organized, validly existing, and in good standing under the Laws of the
State of Georgia and is duly registered as a bank holding company under the BHC
Act. North ▇▇▇▇▇▇ has the corporate power and authority to carry on its
business as now conducted and to own, lease and operate its Assets. North
▇▇▇▇▇▇ is duly qualified or licensed to transact business as a foreign
corporation in good standing in the States
6
of the United States and foreign jurisdictions where the character of its Assets
or the nature or conduct of its business requires it to be so qualified or
licensed, except for such jurisdictions in which the failure to be so qualified
or licensed is not reasonably likely to have, individually or in the aggregate,
a Material Adverse Effect on North ▇▇▇▇▇▇.
5.2 Authority; No Breach By Agreement.
---------------------------------
(a) North ▇▇▇▇▇▇ has the corporate power and authority necessary to
execute, deliver and perform its obligations under this Agreement and to
consummate the transactions contemplated hereby. The execution, delivery and
performance of this Agreement and the consummation of the transactions
contemplated herein, including the Merger, have been duly and validly authorized
by all necessary corporate action in respect thereof on the part of North
▇▇▇▇▇▇, subject to the approval of this Agreement by the holders of a majority
of the outstanding shares of North ▇▇▇▇▇▇ Common Stock, which is the only
shareholder vote required for approval of this Agreement and consummation of the
Merger by North ▇▇▇▇▇▇. Subject to such requisite shareholder approval, this
Agreement represents a legal, valid and binding obligation of North ▇▇▇▇▇▇,
enforceable against North ▇▇▇▇▇▇ in accordance with its terms (except in all
cases as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium, or similar Laws affecting the
enforcement of creditors' rights generally and except that the availability of
the equitable remedy of specific performance or injunctive relief is subject to
the discretion of the court before which any proceeding may be brought).
(b) Neither the execution and delivery of this Agreement by North
▇▇▇▇▇▇, nor, except as described in Section 5.2 of the North ▇▇▇▇▇▇ Disclosure
----------
Memorandum, the consummation by North ▇▇▇▇▇▇ of the transactions contemplated
----------
hereby, nor compliance by North ▇▇▇▇▇▇ with any of the provisions hereof will
(i) conflict with or result in a breach of any provision of North ▇▇▇▇▇▇'▇
Articles of Incorporation or Bylaws, or (ii) constitute or result in a Default
under, or require any Consent pursuant to, or result in the creation of any Lien
on any Asset of any North ▇▇▇▇▇▇ Company under, any Contract or Permit of any
North ▇▇▇▇▇▇ Company, where such Default or Lien, or any failure to obtain such
Consent, is reasonably likely to have, individually or in the aggregate, a
Material Adverse Effect on North ▇▇▇▇▇▇, or (iii) subject to receipt of the
requisite approvals referred to in Section 9.1 (b) of this Agreement, violate
any Law or Order applicable to any North ▇▇▇▇▇▇ Company or any of their
respective Assets.
(c) Other than in connection or compliance with the provisions of
the Securities Laws, applicable state corporate and securities Laws, and rules
of the NASD, and other than Consents required from Regulatory Authorities, and
other than notices to or filings with the Internal Revenue Service or the
Pension Benefit Guaranty Corporation with respect to any employee benefit plans,
and other than Consents, filings or notifications which, if not obtained or
made, are not reasonably likely to have, individually or in the aggregate, a
Material Adverse Effect on North ▇▇▇▇▇▇, no notice to, filing with, or Consent
of any public body or authority is necessary for the consummation by North
▇▇▇▇▇▇ of the Merger and the other transactions contemplated in this Agreement.
7
5.3 Common Stock.
------------
(a) The authorized common stock of North ▇▇▇▇▇▇ consists of
10,000,000 shares of North ▇▇▇▇▇▇ Common Stock, of which 1,828,821 shares are
issued and outstanding as of the date of this Agreement and not more than
2,329,115 shares will be issued and outstanding at the Effective Time (as a
result of the exercise of outstanding options and the conversion of certain
subordinated debentures). All of the issued and outstanding shares of capital
stock of North ▇▇▇▇▇▇ are duly and validly issued and outstanding and are fully
paid and nonassessable under the GBCC. None of the outstanding shares of capital
stock of North ▇▇▇▇▇▇ has been issued in violation of any preemptive rights of
the current or past shareholders of North ▇▇▇▇▇▇. North ▇▇▇▇▇▇ has reserved
300,000 shares of North ▇▇▇▇▇▇ Common Stock for issuance under the North ▇▇▇▇▇▇
Stock Plans, pursuant to which options to purchase not more than 300,294 shares
of North ▇▇▇▇▇▇ Common Stock are outstanding as of the date of this Agreement
and not more than 300,294 will be outstanding at the Effective Time.
(b) North ▇▇▇▇▇▇ has issued Series A Convertible Subordinated
Debentures with a maturity date of June 30, 2002 (the "Debentures") in the total
principal amount of $1,000,000. The interest rate of the Debentures is 5.59%
per annum. North ▇▇▇▇▇▇ is current in all interest payments under the
Debentures. The Debentures are convertible into a total of 200,000 shares of
North ▇▇▇▇▇▇ Common Stock at a conversion price of $5.00 per share. North
▇▇▇▇▇▇ has disclosed in Section 5.3(b) of the North ▇▇▇▇▇▇ Disclosure Memorandum
---------------------
the names of each holder of a Debenture, together with the principal amount
owing to such holder.
(c) Except as set forth in Section 5.3(a) and (b) of this Agreement,
or as disclosed in Section 5.3 of the North ▇▇▇▇▇▇ Disclosure Memorandum, there
---------------------
are no shares of capital stock or other equity securities of North ▇▇▇▇▇▇
outstanding and no outstanding Rights relating to the capital stock of North
▇▇▇▇▇▇.
5.4 North ▇▇▇▇▇▇ Subsidiaries. North ▇▇▇▇▇▇ has disclosed in Section
-------------------------
5.4 of the North ▇▇▇▇▇▇ Disclosure Memorandum all of the North ▇▇▇▇▇▇
---------------------
Subsidiaries as of the date of this Agreement. Except as disclosed in Section
5.4 of the North ▇▇▇▇▇▇ Disclosure Memorandum, North ▇▇▇▇▇▇ or one of its
---------------------
Subsidiaries owns all of the issued and outstanding shares of capital stock of
each North ▇▇▇▇▇▇ Subsidiary. No equity securities of any North ▇▇▇▇▇▇
Subsidiary are or may become required to be issued (other than to another North
▇▇▇▇▇▇ Company) by reason of any Rights, and there are no Contracts by which any
North ▇▇▇▇▇▇ Subsidiary is bound to issue (other than to another North ▇▇▇▇▇▇
Company) additional shares of its capital stock or Rights, or by which any North
▇▇▇▇▇▇ Company is or may be bound to transfer any shares of the capital stock of
any North ▇▇▇▇▇▇ Subsidiary (other than to another North ▇▇▇▇▇▇ Company). There
are no Contracts relating to the rights of any North ▇▇▇▇▇▇ Company to vote or
to dispose of any shares of the capital stock of any North ▇▇▇▇▇▇ Subsidiary.
All of the shares of capital stock of each North ▇▇▇▇▇▇ Subsidiary held by a
North ▇▇▇▇▇▇ Company are fully paid and nonassessable under the applicable Law
of the jurisdiction in which such Subsidiary is incorporated or organized and
are owned by a North ▇▇▇▇▇▇
8
Company free and clear of any Lien. Each North ▇▇▇▇▇▇ Subsidiary is either a
bank, a savings association or a corporation and is duly organized, validly
existing, and (as to corporations) in good standing under the Laws of the
jurisdiction in which it is organized and has the corporate power and authority
necessary for it to own, lease and operate its Assets and to carry on its
business as now conducted. Each North ▇▇▇▇▇▇ Subsidiary is duly qualified or
licensed to transact business as a foreign corporation in good standing in the
States of the United States and foreign jurisdictions where the character of its
Assets or the nature or conduct of its business requires it to be so qualified
or licensed, except for such jurisdictions in which the failure to be so
qualified or licensed is not reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect on North ▇▇▇▇▇▇. Each North ▇▇▇▇▇▇
Subsidiary that is a depository institution is an "insured institution" as
defined in the Federal Deposit Insurance Act and applicable regulations
thereunder, and the deposits in which are insured by the Bank Insurance Fund or
the Savings Association Insurance Fund, as appropriate.
5.5 Financial Statements. North ▇▇▇▇▇▇ has included in Section 5.5 of
--------------------
the North ▇▇▇▇▇▇ Disclosure Memorandum copies of all North ▇▇▇▇▇▇ Financial
---------------------
Statements for periods ended prior to the date hereof and will deliver to
Premier copies of all North ▇▇▇▇▇▇ Financial Statements prepared subsequent to
the date hereof. The North ▇▇▇▇▇▇ Financial Statements (as of the dates thereof
and for the periods covered thereby) (a) are, or if dated after the date of this
Agreement will be, in accordance with the books and records of the North ▇▇▇▇▇▇
Companies, which are or will be, as the case may be, complete and correct and
which have been or will have been, as the case may be, maintained in accordance
with good business practices, and (b) present or will present, as the case may
be, fairly the consolidated financial position of the North ▇▇▇▇▇▇ Companies as
of the dates indicated and the consolidated results of operations, changes in
shareholders' equity, and cash flows of the North ▇▇▇▇▇▇ Companies for the
periods indicated, in accordance with GAAP (subject to any exceptions as to
consistency specified therein or as may be indicated in the notes thereto or, in
the case of interim financial statements, to normal recurring year-end
adjustments that are not material in amount or effect).
5.6 Absence of Undisclosed Liabilities. No North ▇▇▇▇▇▇ Company has any
----------------------------------
Liabilities that are reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect on North ▇▇▇▇▇▇ except Liabilities which
are accrued or reserved against in the consolidated balance sheets of North
▇▇▇▇▇▇ as of December 31, 1998, included in the North ▇▇▇▇▇▇ Financial
Statements or reflected in the notes thereto. No North ▇▇▇▇▇▇ Company has
incurred or paid any Liability since December 31, 1998, except for such
Liabilities incurred or paid in the ordinary course of business consistent with
past business practice and which are not reasonably likely to have, individually
or in the aggregate, a Material Adverse Effect on North ▇▇▇▇▇▇.
5.7 Absence of Certain Changes or Events. Since December 31, 1998,
------------------------------------
except as disclosed in Section 5.7 of the North ▇▇▇▇▇▇ Disclosure Memorandum,
---------------------
(a) there have been no events, changes or occurrences which have had, or are
reasonably likely to have, individually or in the aggregate, a Material Adverse
Effect on North ▇▇▇▇▇▇, and (b) the North ▇▇▇▇▇▇ Companies have not taken any
action, or failed to take any action, prior to the date of this Agreement, which
action or
9
failure, if taken after the date of this Agreement, would represent or result in
a material breach or violation of any of the covenants and agreements of North
▇▇▇▇▇▇ provided in Article VII of this Agreement.
5.8 Tax Matters.
-----------
(a) All Tax returns required to be filed by or on behalf of any of
the North ▇▇▇▇▇▇ Companies have been timely filed or requests for extensions
have been timely filed, granted, and have not expired, except to the extent that
all such failures to file, taken together, are not reasonably likely to have a
Material Adverse Effect on North ▇▇▇▇▇▇ and all returns filed are complete and
accurate to the Knowledge of North ▇▇▇▇▇▇. All Taxes shown on filed returns have
been paid. As of the date of this Agreement, there is no audit examination,
deficiency or refund Litigation with respect to any Taxes that is reasonably
likely to result in a determination that would have, individually or in the
aggregate, a Material Adverse Effect on North ▇▇▇▇▇▇, except as reserved against
in the North ▇▇▇▇▇▇ Financial Statements delivered prior to the date of this
Agreement or as disclosed in Section 5.8(a) of the North ▇▇▇▇▇▇ Disclosure
----------
Memorandum. All Taxes and other Liabilities due with respect to completed and
----------
settled examinations or concluded Litigation have been paid.
(b) Except as disclosed in Section 5.8(b) of the North ▇▇▇▇▇▇
Disclosure Memorandum, none of the North ▇▇▇▇▇▇ Companies has executed an
---------------------
extension or waiver of any statute of limitations on the assessment or
collection of any Tax due that is currently in effect, and no unpaid tax
deficiency has been asserted in writing against or with respect to any North
▇▇▇▇▇▇ Company, which deficiency is reasonably likely to have, individually or
in the aggregate, a Material Adverse Effect on North ▇▇▇▇▇▇.
(c) Adequate provision for any Taxes due or to become due for any of
the North ▇▇▇▇▇▇ Companies for the period or periods through and including the
date of the respective North ▇▇▇▇▇▇ Financial Statements has been made and is
reflected on such North ▇▇▇▇▇▇ Financial Statements.
(d) Deferred Taxes of the North ▇▇▇▇▇▇ Companies have been provided
for in accordance with GAAP.
(e) Each of the North ▇▇▇▇▇▇ Companies is in compliance with, and
its records contain all information and documents (including, without
limitation, properly completed IRS Forms W-9) necessary to comply with, all
applicable information reporting and Tax withholding requirements under federal,
state and local Tax Laws, and such records identify with specificity all
accounts subject to backup withholding under Section 3406 of the Internal
Revenue Code, except for such instances of noncompliance and such omissions as
are not reasonably likely to have, individually or in the aggregate, a Material
Adverse Effect on North ▇▇▇▇▇▇.
10
5.9 Allowance for Possible Loan Losses. The allowance for possible loan
----------------------------------
or credit losses (the "Allowance") shown on the consolidated balance sheets of
North ▇▇▇▇▇▇ included in the most recent North ▇▇▇▇▇▇ Financial Statements dated
prior to the date of this Agreement was, and the Allowance shown on the
consolidated balance sheets of North ▇▇▇▇▇▇ included in the North ▇▇▇▇▇▇
Financial Statements as of dates subsequent to the execution of this Agreement
will be, as of the dates thereof, adequate (within the meaning of GAAP and
applicable regulatory requirements or guidelines) to provide for losses relating
to or inherent in the loan and lease portfolios (including accrued interest
receivables) of the North ▇▇▇▇▇▇ Companies and other extensions of credit
(including letters of credit and commitments to make loans or extend credit) by
the North ▇▇▇▇▇▇ Companies as of the dates thereof except where the failure of
such Allowance to be so adequate is not reasonably likely to have a Material
Adverse Effect on North ▇▇▇▇▇▇.
5.10 Assets. Except as disclosed in Section 5.10 of the North ▇▇▇▇▇▇
------
Disclosure Memorandum or as disclosed or reserved against in the North ▇▇▇▇▇▇
---------------------
Financial Statements, the North ▇▇▇▇▇▇ Companies have good and marketable title,
free and clear of all Liens, to all of their respective Assets. All material
tangible properties used in the businesses of the North ▇▇▇▇▇▇ Companies are in
good condition, reasonable wear and tear excepted, and are usable in the
ordinary course of business consistent with North ▇▇▇▇▇▇'▇ past practices. All
Assets which are material to the business of the North ▇▇▇▇▇▇ Companies and held
under leases or subleases by any of the North ▇▇▇▇▇▇ Companies are held under
valid Contracts enforceable in accordance with their respective terms (except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other Laws affecting the enforcement of creditors'
rights generally and except that the availability of the equitable remedy of
specific performance or injunctive relief is subject to the discretion of the
court before which any proceedings may be brought), and each such Contract is in
full force and effect. The policies of fire, theft, liability and other
insurance maintained with respect to the Assets or businesses of the North
▇▇▇▇▇▇ Companies provide adequate coverage under current industry practices
against loss or Liability, and the fidelity and blanket bonds in effect as to
which any of the North ▇▇▇▇▇▇ Companies is a named insured are reasonably
sufficient. The Assets of the North ▇▇▇▇▇▇ Companies include all assets
required to operate the business of the North ▇▇▇▇▇▇ Companies as presently
conducted.
5.11 Environmental Matters. Except as disclosed in Section 5.11 of the
---------------------
North ▇▇▇▇▇▇ Disclosure Memorandum:
---------------------
(a) To the Knowledge of North ▇▇▇▇▇▇, each North ▇▇▇▇▇▇ Company, its
Participation Facilities and its Loan Properties are, and have been, in
compliance with all Environmental Laws, except for noncompliance which is not
reasonably likely to have, individually or in the aggregate, a Material Adverse
Effect on North ▇▇▇▇▇▇.
(b) There is no Litigation pending or to the Knowledge of North
▇▇▇▇▇▇ threatened before any court, governmental agency or authority or other
forum in which any North ▇▇▇▇▇▇ Company or any of its Loan Properties or
Participation Facilities has been or, with respect to threatened Litigation, may
be named as a defendant or potentially responsible party (i) for alleged
11
noncompliance with any Environmental Law or (ii) relating to the Release into
the Environment of any Hazardous Material, whether or not occurring at, on,
under or involving a site owned, leased or operated by any North ▇▇▇▇▇▇ Company
or any of its Loan Properties or Participation Facilities, except for such
Litigation pending or threatened the resolution of which is not reasonably
likely to have, individually or in the aggregate, a Material Adverse Effect on
North ▇▇▇▇▇▇, and to the Knowledge of North ▇▇▇▇▇▇, there is no reasonable basis
for any such Litigation.
(c) To the Knowledge of North ▇▇▇▇▇▇, there have been no releases of
Hazardous Material in, on, under or affecting any Participation Facility or Loan
Property, except such as are not reasonably likely to have, individually or in
the aggregate, a Material Adverse Effect on North ▇▇▇▇▇▇.
5.12 Compliance with Laws. North ▇▇▇▇▇▇ is duly registered as a bank
--------------------
holding company under the BHC Act. Each North ▇▇▇▇▇▇ Company has in effect all
Permits necessary for it to own, lease or operate its Assets and to carry on its
business as now conducted, except for those Permits the absence of which are not
reasonably likely to have, individually or in the aggregate, a Material Adverse
Effect on North ▇▇▇▇▇▇, and there has occurred no Default under any such Permit,
other than Defaults which are not reasonably likely to have, individually or in
the aggregate, a Material Adverse Effect on North ▇▇▇▇▇▇. Except as disclosed
in Section 5.12 of the North ▇▇▇▇▇▇ Disclosure Memorandum, no North ▇▇▇▇▇▇
---------------------
Company:
(a) is in violation of any Laws, Orders or Permits applicable to its
business or employees conducting its business, except for violations which are
not reasonably likely to have, individually or in the aggregate, a Material
Adverse Effect on North ▇▇▇▇▇▇; and
(b) has received any notification or communication from any agency
or department of federal, state, or local government or any Regulatory Authority
or the staff thereof (i) asserting that any North ▇▇▇▇▇▇ Company is not in
compliance with any of the Laws or Orders which such governmental authority or
Regulatory Authority enforces, where such noncompliance is reasonably likely to
have, individually or in the aggregate, a Material Adverse Effect on North
▇▇▇▇▇▇, (ii) threatening to revoke any Permits, the revocation of which is
reasonably likely to have, individually or in the aggregate, a Material Adverse
Effect on North ▇▇▇▇▇▇, or (iii) requiring any North ▇▇▇▇▇▇ Company to enter
into or consent to the issuance of a cease and desist order, formal agreement,
directive, commitment or memorandum of understanding, or to adopt any Board
resolution or similar undertaking, which restricts materially the conduct of its
business, or in any manner relates to its capital adequacy, its credit or
reserve policies, its management, or the payment of dividends.
5.13 Labor Relations. No North ▇▇▇▇▇▇ Company is the subject of any
---------------
Litigation asserting that it or any other North ▇▇▇▇▇▇ Company has committed an
unfair labor practice (within the meaning of the National Labor Relations Act or
comparable state law) or seeking to compel it or any other North ▇▇▇▇▇▇ Company
to bargain with any labor organization as to wages or conditions of employment,
nor is there any strike or other labor dispute involving any North ▇▇▇▇▇▇
Company,
12
pending or, to its Knowledge, threatened, nor, to its Knowledge, is there any
activity involving any North ▇▇▇▇▇▇ Company's employees seeking to certify a
collective bargaining unit or engaging in any other organization activity.
5.14 Employee Benefit Plans.
----------------------
(a) North ▇▇▇▇▇▇ has disclosed in Section 5.14 of the North ▇▇▇▇▇▇
Disclosure Memorandum and delivered or made available to Premier prior to the
---------------------
execution of this Agreement copies in each case of all pension, retirement,
profit-sharing, deferred compensation, stock option, employee stock ownership,
severance pay, vacation, bonus, or other incentive plans, all other written
employee programs, arrangements, or agreements, all medical, vision, dental, or
other health plans, all life insurance plans, and all other employee benefit
plans or fringe benefit plans, including, without limitation, "employee benefit
plans" as that term is defined in Section 3(3) of ERISA, currently adopted,
maintained by, sponsored in whole or in part by, or contributed to by any North
▇▇▇▇▇▇ Company or Affiliate thereof for the benefit of employees, retirees,
dependents, spouses, directors, independent contractors, or other beneficiaries
and under which employees, retirees, dependents, spouses, directors, independent
contractors, or other beneficiaries are eligible to participate (collectively,
the "North ▇▇▇▇▇▇ Benefit Plans"). Any of the North ▇▇▇▇▇▇ 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 "North ▇▇▇▇▇▇ ERISA Plan." Each North
▇▇▇▇▇▇ ERISA Plan which is also a "defined benefit plan" (as defined in Section
414(j) of the Internal Revenue Code) is referred to herein as a "North ▇▇▇▇▇▇
Pension Plan." No North ▇▇▇▇▇▇ Pension Plan is or has been a multi-employer
plan within the meaning of Section 3(37) of ERISA.
(b) All North ▇▇▇▇▇▇ Benefit Plans are in compliance with the
applicable terms of ERISA, the Internal Revenue Code, and any other applicable
Laws the breach or violation of which are reasonably likely to have,
individually or in the aggregate, a Material Adverse Effect on North ▇▇▇▇▇▇.
Each North ▇▇▇▇▇▇ ERISA Plan which is intended to be qualified under Section
401(a) of the Internal Revenue Code has received a favorable determination
letter from the Internal Revenue Service, and North ▇▇▇▇▇▇ is not aware of any
circumstances likely to result in revocation of any such favorable determination
letter. To the Knowledge of North ▇▇▇▇▇▇, no North ▇▇▇▇▇▇ Company nor any other
party has engaged in a transaction with respect to any North ▇▇▇▇▇▇ Benefit Plan
that, assuming the taxable period of such transaction expired as of the date
hereof, would subject any North ▇▇▇▇▇▇ Company to a tax or penalty imposed by
either Section 4975 of the Internal Revenue Code or Section 502(i) of ERISA in
amounts which are reasonably likely to have, individually or in the aggregate, a
Material Adverse Effect on North ▇▇▇▇▇▇.
(c) Neither North ▇▇▇▇▇▇ nor any ERISA Affiliate of North ▇▇▇▇▇▇
maintains an "employee pension benefit plan," within the meaning of Section 3(2)
of ERISA that is or was subject to Title IV of ERISA.
13
(d) Neither North ▇▇▇▇▇▇ nor any ERISA Affiliate of North ▇▇▇▇▇▇ has
any past, present or future obligation or liability to contribute to any multi-
employer plan, as defined in Section 3(37) of ERISA.
(e) Except as disclosed in Section 5.14(e) of the North ▇▇▇▇▇▇
Disclosure Memorandum, (i) no North ▇▇▇▇▇▇ Company has any obligations for
---------------------
retiree health and life benefits under any of the North ▇▇▇▇▇▇ Benefit Plans,
except as required by Section 601 of ERISA and Section 4980B of the Code; (ii)
there are no restrictions on the rights of any North ▇▇▇▇▇▇ Company to amend or
terminate any such Plan; and (iii) any amendment or termination of any such Plan
will not cause any North ▇▇▇▇▇▇ Company to incur any Liability that is
reasonably likely to have a Material Adverse Effect on North ▇▇▇▇▇▇.
(f) Except as disclosed in Section 5.14(f) of the North ▇▇▇▇▇▇
Disclosure Memorandum, neither the execution and delivery of this Agreement nor
---------------------
the consummation of the transactions contemplated hereby will (i) result in any
payment (including, without limitation, severance, unemployment compensation,
golden parachute or otherwise) becoming due to any director or any employee of
any North ▇▇▇▇▇▇ Company from any North ▇▇▇▇▇▇ Company under any North ▇▇▇▇▇▇
Benefit Plan or otherwise, (ii) increase any benefits otherwise payable under
any North ▇▇▇▇▇▇ Benefit Plan, or (iii) result in any acceleration of the time
of payment or vesting of any such benefit.
(g) The actuarial present values of all accrued deferred
compensation entitlements (including, without limitation, entitlements under any
executive compensation, supplemental retirement, or employment agreement) of
employees and former employees of any North ▇▇▇▇▇▇ Company and their respective
beneficiaries have been fully reflected on the North ▇▇▇▇▇▇ Financial Statements
to the extent required by and in accordance with GAAP.
(h) North ▇▇▇▇▇▇ and each ERISA Affiliate of North ▇▇▇▇▇▇ has
complied with the continuation of coverage requirements of Section 1001 of the
Consolidated Omnibus Budget Reconciliation Act of 1985, as amended, and ERISA
Sections 601 through 608 in a manner that will not cause any North ▇▇▇▇▇▇
Company to incur any Liability that is reasonably likely to have a Material
Adverse Effect on North ▇▇▇▇▇▇.
(i) Except as disclosed in Section 5.14(i) of the North ▇▇▇▇▇▇
Disclosure Memorandum, neither North ▇▇▇▇▇▇ nor any ERISA Affiliate of North
---------------------
▇▇▇▇▇▇ is obligated, contingently or otherwise, under any agreement to pay any
amount which would be treated as a "parachute payment," as defined in Section
280G(b) of the Internal Revenue Code (determined without regard to Section
280G(b)(2)(A)(ii) of the Internal Revenue Code).
(j) Other than routine claims for benefits, to the Knowledge of
North ▇▇▇▇▇▇, there are no actions, audits, investigations, suits or claims
pending against any North ▇▇▇▇▇▇ Benefit Plan, any trust or other funding agency
created thereunder, or against any fiduciary of any North ▇▇▇▇▇▇ Benefit Plan or
against the assets of any North ▇▇▇▇▇▇ Benefit Plan.
14
5.15 Material Contracts. Except as disclosed in Section 5.15 of the
-------------------
North ▇▇▇▇▇▇ Disclosure Memorandum or otherwise reflected in the North ▇▇▇▇▇▇
---------------------
Financial Statements, none of the North ▇▇▇▇▇▇ Companies, nor any of their
respective Assets, businesses or operations, is a party to, or is bound or
affected by, or receives benefits under, (a) any employment, severance,
termination, consulting or retirement Contract providing for aggregate payments
to any Person in any calendar year in excess of $25,000, excluding "at will"
employment arrangements, (b) any Contract relating to the borrowing of money by
any North ▇▇▇▇▇▇ Company or the guarantee by any North ▇▇▇▇▇▇ Company of any
such obligation (other than Contracts evidencing deposit liabilities, purchases
of federal funds, Federal Home Loan Bank advances, fully-secured repurchase
agreements, trade payables, and Contracts relating to borrowings or guarantees
made in the ordinary course of business), (c) any Contracts between or among
North ▇▇▇▇▇▇ Companies, and (d) any other Contract (excluding this Agreement) or
amendment thereto that is required to be filed as an exhibit to a Form 10-KSB or
Form 10-QSB filed by North ▇▇▇▇▇▇ with the SEC as of the date of this Agreement
if North ▇▇▇▇▇▇ were required to file a Form 10-KSB or 10-QSB with the SEC
(together with all Contracts referred to in Sections 5.10 and 5.14(a) of this
Agreement, the "North ▇▇▇▇▇▇ Contracts"). None of the North ▇▇▇▇▇▇ Companies is
in Default under any North ▇▇▇▇▇▇ Contract, other than Defaults which are not
reasonably likely to have, individually or in the aggregate, a Material Adverse
Effect on North ▇▇▇▇▇▇. All of the indebtedness of any North ▇▇▇▇▇▇ Company for
money borrowed is prepayable at any time by such North ▇▇▇▇▇▇ Company without
penalty or premium.
5.16 Legal Proceedings. Except as disclosed in Section 5.16 of the North
------------------
▇▇▇▇▇▇ Disclosure Memorandum, there is no Litigation instituted or pending, or,
---------------------
to the Knowledge of North ▇▇▇▇▇▇, threatened (or unasserted but considered
probable of assertion and which if asserted would have at least a reasonable
probability of an unfavorable outcome) against any North ▇▇▇▇▇▇ Company, or
against any Asset, interest, or right of any of them, that is reasonably likely
to have, individually or in the aggregate, a Material Adverse Effect on North
▇▇▇▇▇▇, nor are there any Orders of any Regulatory Authorities, other
governmental authorities, or arbitrators outstanding against any North ▇▇▇▇▇▇
Company, that are reasonably likely to have, individually or in the aggregate, a
Material Adverse Effect on North ▇▇▇▇▇▇.
5.17 Reports. Since January 1, 1997, each North ▇▇▇▇▇▇ Company has
--------
timely filed all reports and statements, together with any amendments required
to be made with respect thereto, that it was required to file with (a) the
Regulatory Authorities, and (b) any applicable federal and state securities or
banking authorities (except, in the case of state securities authorities,
failures to file which are not reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect on North ▇▇▇▇▇▇). As of their respective
dates, each of such reports and documents, including the financial statements,
exhibits, and schedules thereto, complied in all material respects with all
applicable Laws. As of its respective date, each such report and document to
North ▇▇▇▇▇▇'▇ Knowledge did not, in any material respect, contain any untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements made therein, in light of the
circumstances under which they were made, not misleading.
15
5.18 Statements True and Correct. No statement, certificate, instrument
----------------------------
or other writing furnished or to be furnished by any North ▇▇▇▇▇▇ Company or any
Affiliate thereof to Premier pursuant to this Agreement or any other document,
agreement or instrument referred to herein contains or will contain any untrue
statement of material fact or will omit to state a Material fact necessary to
make the statements therein, in light of the circumstances under which they were
made, not misleading. None of the information supplied or to be supplied by any
North ▇▇▇▇▇▇ Company or any Affiliate thereof for inclusion in the Registration
Statement to be filed by Premier with the SEC will, when the Registration
Statement becomes effective, be false or misleading with respect to any Material
fact, or omit to state any Material fact necessary to make the statements
therein not misleading. None of the information supplied or to be supplied by
any North ▇▇▇▇▇▇ Company or any Affiliate thereof for inclusion in the Proxy
Statement to be mailed to North ▇▇▇▇▇▇'▇ shareholders in connection with the
North ▇▇▇▇▇▇ Shareholders' Meeting, and any other documents to be filed by a
North ▇▇▇▇▇▇ Company or any Affiliate thereof with the SEC or any other
Regulatory Authority in connection with the transactions contemplated hereby,
will, at the respective time such documents are filed, and with respect to the
Proxy Statement, when first mailed to the shareholders of North ▇▇▇▇▇▇, be false
or misleading with respect to any Material fact, or omit to state any Material
fact necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading, or, in the case of the Proxy
Statement or any amendment thereof or supplement thereto, at the time of the
North ▇▇▇▇▇▇ Shareholders' Meeting, be false or misleading with respect to any
Material fact, or omit to state any material fact necessary to correct any
statement in any earlier communication with respect to the solicitation of any
proxy for the North ▇▇▇▇▇▇ Shareholders' Meeting. All documents that any North
▇▇▇▇▇▇ Company or any Affiliate thereof 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.
5.19 Accounting, Tax and Regulatory Matters. No North ▇▇▇▇▇▇ Company or
---------------------------------------
any Affiliate thereof has taken any action, or agreed to take any action, or has
any Knowledge of any fact or circumstance that is reasonably likely to (a)
prevent the transactions contemplated hereby, including the Merger, from
qualifying for pooling-of-interests accounting treatment or treatment as a
reorganization within the meaning of Section 368(a) of the Internal Revenue
Code, or (b) materially impede or delay receipt of any Consents of Regulatory
Authorities referred to in Section 9.1(b) of this Agreement or result in the
imposition of a condition or restriction of the type referred to in the second
sentence of such Section. To the Knowledge of North ▇▇▇▇▇▇, there exists no
fact, circumstance, or reason why the requisite Consents referred to in Section
9.1(b) of this Agreement cannot be received in a timely manner without the
imposition of any condition or restriction of the type described in the second
sentence of such Section 9.1(b).
5.20 Charter Provisions. Each North ▇▇▇▇▇▇ Company has taken all action
-------------------
so that the entering into of this Agreement and the consummation of the Merger
and the other transactions contemplated by this Agreement do not and will not
result in the grant of any rights to any Person under the Articles of
Incorporation, Bylaws or other governing instruments of any North ▇▇▇▇▇▇
16
Company or restrict or impair the ability of Premier to vote, or otherwise to
exercise the rights of a shareholder with respect to, shares of any North ▇▇▇▇▇▇
Company that may be acquired or controlled by it.
5.21 State Anti-Takeover Laws. Each North ▇▇▇▇▇▇ Company has taken all
-------------------------
necessary action to exempt the transactions contemplated by this Agreement from
any applicable "moratorium," "control share," "fair price," "business
combination," or other anti-takeover laws and regulations of the State of
Georgia including those laws contained within Sections 14-2-1110 et seq. and 14-
2-1131 et seq. of the GBCC.
5.22 Millennium Compliance. North ▇▇▇▇▇▇ represents and warrants that
----------------------
each North ▇▇▇▇▇▇ Company has tested and assessed its software, hardware, and
other computer equipment to ensure that there will not be a Year 2000 Problem.
North ▇▇▇▇▇▇ further represents and warrants that each North ▇▇▇▇▇▇ Company has
prepared and implemented a written plan of action to ensure that the software,
hardware, and other computer equipment owned, licensed, or used by each North
▇▇▇▇▇▇ Company will not be the subject of a failure in any such software,
hardware, or other computer equipment as a result of a Year 2000 Problem. North
▇▇▇▇▇▇ further represents and warrants that each North ▇▇▇▇▇▇ Company has
contacted and received assurances from all key suppliers of goods and services
to each North ▇▇▇▇▇▇ Company, including but not limited to suppliers of computer
software, computer hardware, and other computer equipment, that each of the
software, hardware, and other computer equipment owned, licensed, or used by
such suppliers will not be the subject of failures in any such software,
hardware, or other computer equipment as a result of a Year 2000 Problem.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES OF PREMIER
-----------------------------------------
Premier hereby represents and warrants to North ▇▇▇▇▇▇ as follows:
6.1 Organization, Standing, and Power. Premier is a corporation duly
----------------------------------
organized, validly existing, and in good standing under the Laws of the State of
Georgia, and is duly registered as a bank holding company under the BHC Act.
Premier has the corporate power and authority to carry on its business as now
conducted and to own, lease and operate its Assets. Premier is duly qualified
or licensed to transact business as a foreign corporation in good standing in
the States of the United States and foreign jurisdictions where the character of
its Assets or the nature or conduct of its business requires it to be so
qualified or licensed, except for such jurisdictions in which the failure to be
so qualified or licensed is not reasonably likely to have, individually or in
the aggregate, a Material Adverse Effect on Premier.
6.2 Authority; No Breach By Agreement.
----------------------------------
17
(a) Premier has the corporate power and authority necessary to
execute, deliver and perform its obligations under this Agreement and to
consummate the transactions contemplated hereby. The execution, delivery and
performance of this Agreement and the consummation of the transactions
contemplated herein, including the Merger, have been duly and validly authorized
by all necessary corporate action in respect thereof on the part of Premier.
This Agreement represents a legal, valid and binding obligation of Premier,
enforceable against Premier in accordance with its terms (except in all cases as
such enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium, or similar Laws affecting the enforcement of
creditors' rights generally and except that the availability of the equitable
remedy of specific performance or injunctive relief is subject to the discretion
of the court before which any proceeding may be brought).
(b) Except as described in Section 6.2 of the Premier Disclosure
----------
Memorandum, neither the execution and delivery of this Agreement by Premier, nor
----------
the consummation by Premier of the transactions contemplated hereby, nor
compliance by Premier with any of the provisions hereof will (i) conflict with
or result in a breach of any provision of Premier's Articles of Incorporation or
Bylaws, or (ii) constitute or result in a Default under, or require any Consent
pursuant to, or result in the creation of any Lien on any Asset of any Premier
Company under, any Contract or Permit of any Premier Company, where such Default
or Lien, or any failure to obtain such Consent, is reasonably likely to have,
individually or in the aggregate, a Material Adverse Effect on Premier, or (iii)
subject to receipt of the requisite approvals referred to in Section 9.1(b) of
this Agreement, violate any Law or Order applicable to any Premier Company or
any of their respective Assets.
(c) Other than in connection or compliance with the provisions of
the Securities Laws, applicable state corporate and securities Laws, and rules
of the NASD, and other than Consents required from Regulatory Authorities, and
other than notices to or filings with the Internal Revenue Service or the
Pension Benefit Guaranty Corporation with respect to any employee benefit plans,
and other than Consents, filings or notifications which, if not obtained or
made, are not reasonably likely to have, individually or in the aggregate, a
Material Adverse Effect on Premier, no notice to, filing with, or Consent of,
any public body or authority is necessary for the consummation by Premier of the
Merger and the other transactions contemplated in this Agreement.
6.3 Capital Stock.
--------------
(a) The authorized capital stock of Premier consists of 60,000,000
shares of Premier Common Stock, of which 26,102,975 shares were issued and
outstanding as of the date of this Agreement and 2,000,000 shares of preferred
stock of which 40,770 shares are issued and outstanding as of the date of this
Agreement. All of the issued and outstanding shares of Premier Common Stock
are, and all of the shares of Premier Common Stock to be issued in exchange for
shares of North ▇▇▇▇▇▇ Common Stock upon consummation of the Merger, when issued
in accordance with the terms of this Agreement, will be, duly and validly issued
and outstanding and fully paid and nonassessable under the GBCC. None of the
outstanding shares of Premier Common
18
Stock has been, and none of the shares of Premier Common Stock to be issued in
exchange for shares of North ▇▇▇▇▇▇ Common Stock upon consummation of the Merger
will be, issued in violation of any preemptive rights of the current or past
shareholders of Premier.
(b) Premier has issued $29,639,175 of 9.00% Subordinated Debentures
to Premier Capital Trust I, a statutory business trust organized and existing
under the laws of the State of Delaware. The Subordinated Debentures will mature
on December 31, 2027. The Subordinated Debentures were purchased by Premier
Capital Trust I with the proceeds of the public offering of 1,150,000 shares of
9.00% Cumulative Trust Preferred Securities and sale of Common Securities to
Premier. Premier owns all of the Common Securities issued by Premier Capital
Trust I. The Common Securities and the Preferred Securities represent undivided
beneficial interests in the assets of Premier Capital Trust I.
(c) Except as set forth in Sections 6.3(a) and 6.3(b) of this
Agreement, or as disclosed in Section 6.3(c) of the Premier Disclosure
----------
Memorandum, there are no shares of capital stock or other equity securities of
----------
Premier outstanding and no outstanding Rights relating to the capital stock of
Premier.
6.4 Premier Subsidiaries. Premier has disclosed in Section 6.4 of the
---------------------
Premier Disclosure Memorandum all of the Premier Subsidiaries as of the date of
---------------------
this Agreement. Except as disclosed in Section 6.4 of the Premier Disclosure
----------
Memorandum, Premier or one of its Subsidiaries owns all of the issued and
----------
outstanding shares of capital stock of each Premier Subsidiary. No equity
securities of any Premier Subsidiary are or may become required to be issued
(other than to another Premier Company) by reason of any Rights, and there are
no Contracts by which any Premier Subsidiary is bound to issue (other than to
another Premier Company) additional shares of its capital stock or Rights, or by
which any Premier Company is or may be bound to transfer any shares of the
capital stock of any Premier Subsidiary (other than to another Premier Company).
There are no Contracts relating to the rights of any Premier Company to vote or
to dispose of any shares of the capital stock of any Premier Subsidiary. All of
the shares of capital stock of each Premier Subsidiary held by a Premier Company
are fully paid and nonassessable under the applicable Law of the jurisdiction in
which such Subsidiary is incorporated or organized. Each Premier Subsidiary is
either a bank, a savings association, a corporation or a limited liability
company and is duly organized, validly existing, and (as to corporations) in
good standing under the Laws of the jurisdiction in which it is organized and
has the corporate power and authority necessary for it to own, lease and operate
its Assets and to carry on its business as now conducted. Each Premier
Subsidiary is duly qualified or licensed to transact business as a foreign
corporation in good standing in the States of the United States and foreign
jurisdictions where the character of its Assets or the nature or conduct of its
business requires it to be so qualified or licensed, except for such
jurisdictions in which the failure to be so qualified or licensed is not
reasonably likely to have, individually or in the aggregate, a Material Adverse
Effect on Premier. Each Premier Subsidiary that is a depository institution is
an "insured institution" as defined in the Federal Deposit Insurance Act and
applicable regulations thereunder, and the deposits in which are insured by the
Bank Insurance Fund or the Savings Association Insurance Fund, as appropriate.
19
6.5 Financial Statements. Premier has included in Section 6.5 of the
---------------------
Premier Disclosure Memorandum copies of all Premier Financial Statements for
---------------------
periods ended prior to the date hereof and will deliver to North ▇▇▇▇▇▇ copies
of all Premier Financial Statements prepared subsequent to the date hereof. The
Premier Financial Statements (as of the dates thereof and for the periods
covered thereby) (a) are, or if dated after the date of this Agreement will be,
in accordance with the books and records of the Premier Companies, which are or
will be, as the case may be, complete and correct and which have been or will
have been, as the case may be, maintained in accordance with good business
practices, and (b) present or will present, as the case may be, fairly the
consolidated financial position of the Premier Companies as of the dates
indicated and the consolidated results of operations, changes in shareholders'
equity, and cash flows of the Premier Companies for the periods indicated, in
accordance with GAAP (subject to exceptions as to consistency specified therein
or as may be indicated in the notes thereto or, in the case of interim financial
statements, to normal recurring year-end adjustments that are not material in
amount or effect).
6.6 Absence of Undisclosed Liabilities. No Premier Company has any
-----------------------------------
Liabilities that are reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect on Premier, except Liabilities which are
accrued or reserved against in the consolidated balance sheets of Premier as of
December 31, 1998, included in the Premier Financial Statements or reflected in
the notes thereto. No Premier Company has incurred or paid any Liability since
December 31, 1998, except for such Liabilities incurred or paid in the ordinary
course of business consistent with past business practice and which are not
reasonably likely to have, individually or in the aggregate, a Material Adverse
Effect on Premier.
6.7 Absence of Certain Changes or Events. Since December 31, 1998,
-------------------------------------
except as disclosed in Section 6.7 of the Premier Disclosure Memorandum, (a)
---------------------
there have been no events, changes or occurrences which have had, or are
reasonably likely to have, individually or in the aggregate, a Material Adverse
Effect on Premier, and (b) the Premier Companies have not taken any action, or
failed to take any action, prior to the date of this Agreement, which action or
failure, if taken after the date of this Agreement, would represent or result in
a material breach or violation of any of the covenants and agreements of Premier
provided in Article VII of this Agreement.
6.8 Tax Matters.
------------
(a) All Tax returns required to be filed by or on behalf of any of
the Premier Companies have been timely filed or requests for extensions have
been timely filed, granted, and have not expired, except to the extent that all
such failures to file, taken together, are not reasonably likely to have a
Material Adverse Effect on Premier, and all returns filed are complete and
accurate to the Knowledge of Premier. All Taxes shown on filed returns have been
paid. As of the date of this Agreement, there is no audit examination,
deficiency or refund Litigation with respect to any Taxes that is reasonably
likely to result in a determination that would have, individually or in the
aggregate, a Material Adverse Effect on Premier, except as reserved against in
the Premier Financial Statements delivered prior to the date of this Agreement
or as disclosed in Section 6.8(a) of the
20
Premier Disclosure Memorandum. All Taxes and other Liabilities due with respect
-----------------------------
to completed and settled examinations or concluded Litigation have been paid.
(b) Except as disclosed in Section 6.8(b) of the Premier Disclosure
----------
Memorandum none of the Premier Companies has executed an extension or waiver of
----------
any statute of limitations on the assessment or collection of any Tax due that
is currently in effect, and no unpaid tax deficiency has been asserted in
writing against or with respect to any Premier Company, which deficiency is
reasonably likely to have, individually or in the aggregate, a Material Adverse
Effect on Premier.
(c) Adequate provision for any Taxes due or to become due for any
of the Premier Companies for the period or periods through and including the
date of the respective Premier Financial Statements has been made and is
reflected on such Premier Financial Statements.
(d) Deferred Taxes of the Premier Companies have been provided for
in accordance with GAAP.
(e) Each of the Premier Companies is in compliance with, and its
records contain all information and documents (including, without limitation,
properly completed IRS Forms W-9) necessary to comply with, all applicable
information reporting and Tax withholding requirements under federal, state and
local Tax Laws, and such records identify with specificity all accounts subject
to backup withholding under Section 3406 of the Internal Revenue Code, except
for such instances of noncompliance and such omissions as are not reasonably
likely to have, individually or in the aggregate, a Material Adverse Effect on
Premier.
6.9 Allowance for Possible Loan Losses. The Allowance shown on the
----------------------------------
consolidated balance sheets of Premier included in the most recent Premier
Financial Statements dated prior to the date of this Agreement was, and the
Allowance shown on the consolidated balance sheets of Premier included in the
Premier Financial Statements as of dates subsequent to the execution of this
Agreement will be, as of the dates thereof, adequate (within the meaning of GAAP
and applicable regulatory requirements or guidelines) to provide for losses
relating to or inherent in the loan and lease portfolios (including accrued
interest receivables) of the Premier Companies and other extensions of credit
(including letters of credit and commitments to make loans or extend credit) by
the Premier Companies as of the dates thereof except where the failure of such
Allowance to be so adequate is not reasonably likely to have a Material Adverse
Effect on Premier.
6.11 Environmental Matters. Except as disclosed in Section 6.10 of the
---------------------
Premier Disclosure Memorandum:
---------------------
(a) To the Knowledge of Premier, each Premier Company, its
Participation Facilities and its Loan Properties are, and have been, in
compliance with all Environmental Laws, except for noncompliance which is not
reasonably likely to have, individually or in the aggregate, a Material Adverse
Effect on Premier.
21
(b) There is no Litigation pending or to the Knowledge of Premier
threatened before any court, governmental agency or authority or other forum in
which any Premier Company or any of its Loan Properties or Participation
Facilities has been or, with respect to threatened Litigation, may be named as a
defendant or potentially responsible party (i) for alleged noncompliance with
any Environmental Law or (ii) relating to the Release into the Environment of
any Hazardous Material, whether or not occurring at, on, under or involving a
site owned, leased or operated by any Premier Company or any of its Loan
Properties or Participation Facilities, except for such Litigation pending or
threatened the resolution of which is not reasonably likely to have,
individually or in the aggregate, a Material Adverse Effect on Premier or to the
Knowledge of Premier, there is no reasonable basis for any such Litigation.
(c) To the Knowledge of Premier, there have been no releases of
Hazardous Material in, on, under or affecting any Participation Facility or Loan
Property, except such as are not reasonably likely to have, individually or in
the aggregate, a Material Adverse Effect on Premier.
6.11 Compliance with Laws. Premier is duly registered as a bank holding
--------------------
company under the BHC Act. Each Premier Company has in effect all Permits
necessary for it to own, lease or operate its Assets and to carry on its
business as now conducted, except for those Permits the absence of which are not
reasonably likely to have, individually or in the aggregate, a Material Adverse
Effect on Premier, and there has occurred no Default under any such Permit,
other than Defaults which are not reasonably likely to have, individually or in
the aggregate, a Material Adverse Effect on Premier. Except as disclosed in
Section 6.11 of the Premier Disclosure Memorandum, no Premier Company:
---------------------
(a) is in violation of any Laws, Orders or Permits applicable to
its business or employees conducting its business, except for violations which
are not reasonably likely to have, individually or in the aggregate, a Material
Adverse Effect on Premier; and
(b) has received any notification or communication from any agency
or department of federal, state, or local government or any Regulatory Authority
or the staff thereof (i) asserting that any Premier Company is not in compliance
with any of the Laws or Orders which such governmental authority or Regulatory
Authority enforces, where such noncompliance is reasonably likely to have,
individually or in the aggregate, a Material Adverse Effect on Premier, (ii)
threatening to revoke any Permits, the revocation of which is reasonably likely
to have, individually or in the aggregate, a Material Adverse Effect on Premier,
or (iii) requiring any Premier Company to enter into or consent to the issuance
of a cease and desist order, formal agreement, directive, commitment or
memorandum of understanding, or to adopt any Board resolution or similar
undertaking, which restricts materially the conduct of its business, or in any
manner relates to its capital adequacy, its credit or reserve policies, its
management, or the payment of dividends.
6.12 Labor Relations. No Premier Company is the subject of any
----------------
Litigation asserting that it or any other Premier Company has committed an
unfair labor practice (within the meaning of the National Labor Relations Act or
comparable state law) or seeking to compel it or any other Premier
22
Company to bargain with any labor organization as to wages or conditions of
employment, nor is there any strike or other labor dispute involving any Premier
Company, pending or, to its Knowledge, threatened, nor, to its Knowledge, is
there any activity involving any Premier Company's employees seeking to certify
a collective bargaining unit or engaging in any other organization activity.
6.13 Material Contracts. Except as disclosed in Section 6.13 of the
-------------------
Premier Disclosure Memorandum or otherwise reflected in the Premier Financial
---------------------
Statements, none of the Premier Companies, nor any of their respective Assets,
businesses or operations, is a party to, or is bound or affected by, or receives
benefits under, (a) any Contract relating to the borrowing of money by any
Premier Company or the guarantee by any Premier Company of any such obligation
(other than Contracts evidencing deposit liabilities, purchases of federal
funds, Federal Home Loan Bank advances, fully-secured repurchase agreements,
trade payables, and Contracts relating to borrowings or guarantees made in the
ordinary course of business), and (b) any other Contract (excluding this
Agreement) or amendment thereto that is required to be filed as an exhibit to a
Form 10-K or Form 10-Q filed by Premier with the SEC as of the date of this
Agreement that has not been filed as an exhibit to any Premier Form 10-K or 10-Q
filed with the SEC (the "Premier Contracts"). None of the Premier Companies is
in Default under any Premier Contract, other than Defaults which are not
reasonably likely to have, individually or in the aggregate, a Material Adverse
Effect on Premier.
6.14 Legal Proceedings. Except as disclosed in Section 6.14 of the
-----------------
Premier Disclosure Memorandum, there is no Litigation instituted or pending, or,
---------------------
to the Knowledge of Premier, threatened (or unasserted but considered probable
of assertion and which if asserted would have at least a reasonable probability
of an unfavorable outcome) against any Premier Company, or against any Asset,
interest, or right of any of them, that is reasonably likely to have,
individually or in the aggregate, a Material Adverse Effect on Premier, nor are
there any Orders of any Regulatory Authorities, other governmental authorities,
or arbitrators outstanding against any Premier Company, that are reasonably
likely to have, individually or in the aggregate, a Material Adverse Effect on
Premier.
6.15 Reports. Since January 1, 1997, each Premier Company has timely
--------
filed all reports and statements, together with any amendments required to be
made with respect thereto, that it was required to file with (a) the SEC,
including, but not limited to, Forms 10-K, Forms 10-Q, Forms 8-K, and Proxy
Statements, (b) other Regulatory Authorities, and (c) any applicable state
securities or banking authorities (except, in the case of state securities
authorities, failures to file which are not reasonably likely to have,
individually or in the aggregate, a Material Adverse Effect on Premier). As of
their respective dates, each of such reports and documents, including the
financial statements, exhibits, and schedules thereto, complied in all material
respect with all applicable Laws. As of its respective date, each such report
and document to Premier's Knowledge did not, in any material respects, contain
any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements made therein,
in light of the circumstances under which they were made, not misleading.
23
6.16 Statements True and Correct. No statement, certificate, instrument
----------------------------
or other writing furnished or to be furnished by any Premier Company or any
Affiliate thereof to North ▇▇▇▇▇▇ pursuant to this Agreement or any other
document, agreement or instrument referred to herein contains or will contain
any untrue statement of Material fact or will omit to state a Material fact
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading. None of the information supplied or to be
supplied by any Premier Company or any Affiliate thereof for inclusion in the
Registration Statement to be filed by Premier with the SEC, will, when the
Registration Statement becomes effective, be false or misleading with respect to
any Material fact, or omit to state any Material fact necessary to make the
statements therein not misleading. None of the documents to be filed by any
Premier Company or any Affiliate thereof with the SEC or any other Regulatory
Authority in connection with the transactions contemplated hereby, will, at the
respective time such documents are filed, be false or misleading with respect to
any Material fact, or omit to state any Material fact necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading. All documents that any Premier Company or any Affiliate thereof
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.
6.17 Accounting, Tax and Regulatory Matters. No Premier Company or any
--------------------------------------
Affiliate thereof has taken any action, or agreed to take any action, or has any
Knowledge of any fact or circumstance that is reasonably likely to (a) prevent
the transactions contemplated hereby, including the Merger, from qualifying for
pooling-of-interests accounting treatment or treatment as a reorganization
within the meaning of Section 368(a) of the Internal Revenue Code, or (b)
materially impede or delay receipt of any Consents of Regulatory Authorities
referred to in Section 9.1(b) of this Agreement. To the Knowledge of Premier,
there exists no fact, circumstance, or reason why the requisite Consents
referred to in Section 9.1(b) of this Agreement cannot be received in a timely
manner without the imposition of any condition or restriction of the type
described in the second sentence of such Section 9.1(b).
6.18 Charter Provisions. Each Premier Company has taken all action so
------------------
that the entering into of this Agreement and the consummation of the Merger and
the other transactions contemplated by this Agreement do not and will not result
in the grant of any rights to any Person under the Articles of Incorporation,
Bylaws or other governing instruments of any Premier Company or restrict or
impair the ability of Premier to vote, or otherwise to exercise the rights of a
shareholder with respect to, shares of any Premier Company that may be acquired
or controlled by it.
6.19 Millennium Compliance. Premier represents and warrants that Premier
---------------------
has tested and assessed its software, hardware, and other computer equipment to
ensure that there will not be a Year 2000 Problem. Premier further represents
and warrants that it has prepared and implemented a written plan of action
designed to ensure that the software, hardware, and other computer equipment
owned, licensed, or used by it will not be the subject of a failure in any such
software, hardware, or other computer equipment as a result of a Year 2000
problem. Premier further represents and warrants that it has contacted and
received assurances from all key suppliers of goods
24
and services, including but not limited to suppliers of computer software,
computer hardware, and other computer equipment, that each of the software,
hardware, and other computer equipment owned, licensed, or used by such supplier
will not be the subject of failures in any such software, hardware, or other
computer equipments as a result of a Year 2000 Problem.
ARTICLE VII
CONDUCT OF BUSINESS PENDING CONSUMMATION
----------------------------------------
7.1 Affirmative Covenants of North ▇▇▇▇▇▇. Unless the prior written
-------------------------------------
consent of Premier shall have been obtained, and except as otherwise
contemplated herein or disclosed in the North ▇▇▇▇▇▇ Disclosure Memorandum,
---------------------
North ▇▇▇▇▇▇ shall, and shall cause each of its Subsidiaries, from the date of
this Agreement until the Effective Time or termination of this Agreement: (a) to
operate its business in the usual, regular and ordinary course; (b) to preserve
intact its business organization and Assets and maintain its rights and
franchises; (c) to use its reasonable efforts to cause its representations and
warranties to be correct at all times; and (d) to take no action which would (i)
adversely affect the ability of any Party to obtain any Consents required for
the transactions contemplated hereby without imposition of a condition or
restriction of the type referred to in the last sentence of Section 9.1(b) or
9.1(c) of this Agreement or (ii) adversely affect in any material respect the
ability of either Party to perform its covenants and agreements under this
Agreement.
7.2 Negative Covenants of North ▇▇▇▇▇▇. Except as disclosed in the
----------------------------------
North ▇▇▇▇▇▇ Disclosure Memorandum, from the date of this Agreement until the
---------------------
earlier of the Effective Time or the termination of this Agreement, North ▇▇▇▇▇▇
covenants and agrees that it will not do or agree or commit to do, or permit any
of its Subsidiaries to do or agree or commit to do, any of the following without
the prior written consent of the chief executive officer of Premier, which
consent shall not be unreasonably withheld:
(a) amend the Articles of Incorporation, Bylaws or other governing
instruments of any North ▇▇▇▇▇▇ Company, or
(b) incur any additional debt obligation or other obligation for
borrowed money (other than indebtedness of a North ▇▇▇▇▇▇ Company to another
North ▇▇▇▇▇▇ Company) in excess of an aggregate of $50,000 (for the North ▇▇▇▇▇▇
Companies on a consolidated basis) except in the ordinary course of the business
of the North ▇▇▇▇▇▇ Companies consistent with past practices (which shall
include, for any of its Subsidiaries, creation of deposit liabilities, purchases
of federal funds, advances from the Federal Reserve Bank or Federal Home Loan
Bank, and entry into repurchase agreements fully secured by U.S. government or
agency securities), or impose, or suffer the imposition, on any Asset of any
North ▇▇▇▇▇▇ Company of any Lien or permit any such Lien to exist (other than in
connection with deposits, repurchase agreements, bankers acceptances, Federal
Home Loan Bank advances, "treasury tax and loan" accounts established in the
ordinary course of business,
25
the satisfaction of legal requirements in the exercise of trust powers, and
Liens in effect as of the date hereof that are disclosed in the North ▇▇▇▇▇▇
Disclosure Memorandum); or
---------------------
(c) repurchase, redeem, or otherwise acquire or exchange (other
than exchanges in the ordinary course under employee benefit plans), directly or
indirectly, any shares, or any securities convertible into any shares, of the
capital stock of any North ▇▇▇▇▇▇ Company, or declare or pay any dividend or
make any other distribution in respect of North ▇▇▇▇▇▇'▇ capital stock; or
(d) except for this Agreement, or pursuant to the exercise of stock
options outstanding as of the date hereof and pursuant to the terms thereof in
existence on the date hereof or the conversion of the Debentures pursuant to
Section 9.2(g), or as disclosed in Section 7.2(d) of the North ▇▇▇▇▇▇ Disclosure
----------
Memorandum, issue, sell, pledge, encumber, authorize the issuance of or enter
----------
into any Contract to issue, sell, pledge, encumber, or authorize the issuance of
or otherwise permit to become outstanding, any additional shares of North
▇▇▇▇▇▇ Common Stock or any other capital stock of any North ▇▇▇▇▇▇ Company, or
any stock appreciation rights, or any option, warrant, conversion, or other
right to acquire any such stock, or any security convertible into any such
stock; or
(e) except as disclosed in Section 7.2(e) of the North ▇▇▇▇▇▇
Disclosure Memorandum, adjust, split, combine or reclassify any capital stock of
---------------------
any North ▇▇▇▇▇▇ Company or issue or authorize the issuance of any other
securities in respect of or in substitution for shares of North ▇▇▇▇▇▇ Common
Stock or sell, lease, mortgage or otherwise dispose of or otherwise encumber (i)
any shares of capital stock of any North ▇▇▇▇▇▇ Subsidiary (unless any such
shares of stock are sold or otherwise transferred to another North ▇▇▇▇▇▇
Company) or (ii) any Asset having a book value in excess of $25,000 other than
in the ordinary course of business for reasonable and adequate consideration; or
(f) except for purchases of U.S. Treasury securities or U.S.
Government agency securities or securities of like maturity or grade or general
obligations of states and municipalities, purchase any securities or make any
material investment, either by purchase of stock or securities, contributions to
capital, Asset transfers, or purchase of any Assets, in any Person other than a
wholly-owned North ▇▇▇▇▇▇ Subsidiary; or otherwise acquire direct or indirect
control over any Person, other than in connection with (i) foreclosures in the
ordinary course of business, or (ii) acquisitions of control by ▇▇▇▇▇▇ National
Bank in its fiduciary capacity; or
(g) grant any increase in compensation or benefits to any employees
whose annual salary exceeds $35,000 of any North ▇▇▇▇▇▇ Company (including such
discretionary increases as may be contemplated by existing employment
agreements), except in accordance with past practice or previously approved by
the Board of Directors of North ▇▇▇▇▇▇, in each case as disclosed in Section
7.2(g) of the North ▇▇▇▇▇▇ Disclosure Memorandum or as required by Law; pay any
---------------------
severance or termination pay or any bonus other than pursuant to written
policies or written Contracts in effect on the date of this Agreement and
disclosed in Section 7.2(g) of the North ▇▇▇▇▇▇ Disclosure Memorandum; enter
---------------------
into or amend any severance agreements with officers of any North ▇▇▇▇▇▇
26
Company; grant any general increase in compensation to all employees; grant any
increase in fees or other increases in compensation or other benefits to
directors of any North ▇▇▇▇▇▇ Company; or voluntarily accelerate the vesting of
any stock options or other stock-based compensation or employee benefits; or
(h) enter into or amend any employment Contract between any North
▇▇▇▇▇▇ Company and any Person (unless such amendment is required by Law) that
the North ▇▇▇▇▇▇ Company does not have the unconditional right to terminate
without Liability (other than Liability for services already rendered), at any
time on or after the Effective Time; or
(i) adopt any new employee benefit plan of any North ▇▇▇▇▇▇ Company
or make any material change in or to any existing employee benefit plans of any
North ▇▇▇▇▇▇ Company other than any such change that is required by Law or that,
in the opinion of counsel, is necessary or advisable to maintain the tax
qualified status of any such plan; or
(j) make any significant change in any Tax or accounting methods or
systems of internal accounting controls, except as may be appropriate to conform
to changes in Tax Laws or regulatory accounting requirements or GAAP; or
(k) commence any Litigation other than in accordance with past
practice, settle any Litigation involving any Liability of any North ▇▇▇▇▇▇
Company for money damages in excess of $50,000 or which imposes material
restrictions upon the operations of any North ▇▇▇▇▇▇ Company;
(l) except in the ordinary course of business, modify, amend or
terminate any material Contract or waive, release, compromise or assign any
material rights or claims; or
(m) default under the Debentures or modify, alter or amend the
Debentures.
7.3 Affirmative Covenants of Premier. Unless the prior written consent
--------------------------------
of North ▇▇▇▇▇▇ shall have been obtained, and except as otherwise contemplated
herein or as disclosed in the Premier Disclosure Memorandum, Premier shall, and
---------------------
shall cause each of its Subsidiaries to, from the date of this Agreement until
the Effective Time or termination of this Agreement: (a) operate its business
in the usual, regular and ordinary course; (b) preserve intact its business
organization and Assets and maintain its rights and franchises; (c) use its
reasonable efforts to cause its representations and warranties to be correct at
all times; and (d) take no action which would (i) adversely affect the ability
of any Party to obtain any Consents required for the transactions contemplated
hereby without imposition of a condition or restriction of the type referred to
in the last sentence of Section 9.1(b) or 9.1(c) of this Agreement or (ii)
adversely affect in any Material respect the ability of either Party to perform
its covenants and agreements under this Agreement.
7.4 Adverse Changes in Condition. Each Party agrees to give written
-----------------------------
notice promptly to the other Party upon becoming aware of the occurrence or
impending occurrence of any event or
27
circumstance relating to it or any of its Subsidiaries which (a) is reasonably
likely to have, individually or in the aggregate, a Material Adverse Effect on
it or (b) is reasonably likely to cause or constitute a material breach of any
of its representations, warranties, or covenants contained herein, and to use
its reasonable efforts to prevent or promptly to remedy the same.
7.5 Reports. Each Party and its Subsidiaries shall file all reports
--------
required to be filed by it with Regulatory Authorities between the date of this
Agreement and the Effective Time and shall deliver to the other Party copies of
all such reports promptly after the same are filed.
ARTICLE VII
ADDITIONAL AGREEMENTS
---------------------
8.1 Registration Statement; Proxy Statement; Shareholder Approval.
-------------------------------------------------------------
(a) As soon as reasonably practicable after execution of this
Agreement, Premier shall file the Registration Statement with the SEC, and shall
use its reasonable efforts to cause the Registration Statement to become
effective under the 1933 Act and take any action required to be taken under the
applicable state Blue Sky or securities Laws in connection with the issuance of
the shares of Premier Common Stock upon consummation of the Merger. North
▇▇▇▇▇▇ shall furnish all information concerning it and the holders of its
capital stock as Premier may reasonably request in connection with such action.
(b) North ▇▇▇▇▇▇ shall call a Shareholders' Meeting, to be held as
soon as reasonably practicable after the Registration Statement is declared
effective by the SEC, for the purpose of voting upon approval of this Agreement
and such other related matters as North ▇▇▇▇▇▇ ▇▇▇▇▇ appropriate.
(c) In connection with the North ▇▇▇▇▇▇ Shareholders' Meeting, (i)
Premier shall prepare and file with the SEC on North ▇▇▇▇▇▇'▇ behalf a Proxy
Statement (which shall be included in the Registration Statement) and mail it to
North ▇▇▇▇▇▇'▇ shareholders, (ii) the Parties shall furnish to each other all
information concerning them that they may reasonably request in connection with
such Proxy Statement, (iii) the Board of Directors of North ▇▇▇▇▇▇ shall
recommend (subject to compliance with the fiduciary duties of the members of the
Board of Directors as advised by counsel) to its shareholders the approval of
this Agreement and (iv) the Board of Directors and officers of North ▇▇▇▇▇▇
shall use their reasonable efforts to obtain such shareholders' approval
(subject to compliance with their fiduciary duties as advised by counsel).
8.2 Exchange Listing. Premier shall use its reasonable efforts to list,
----------------
prior to the Effective Time, on the American Stock Exchange the shares of
Premier Common Stock to be issued to the holders of North ▇▇▇▇▇▇ Common Stock
pursuant to the Merger.
28
8.3 Applications. Premier shall promptly prepare and file, and North
------------
▇▇▇▇▇▇ shall cooperate in the preparation and, where appropriate, filing of,
applications with the Board of Governors of the Federal Reserve System and the
Georgia Department of Banking and Finance seeking the requisite Consents
necessary to consummate the transactions contemplated by this Agreement.
8.4 Filings with State Offices. Upon the terms and subject to the
--------------------------
conditions of this Agreement, Premier shall execute and file the Certificate of
Merger with the Secretary of State of the State of Georgia in connection with
the Closing.
8.5 Agreement as to Efforts to Consummate. Subject to the terms and
--------------------------------------
conditions of this Agreement, each Party agrees to use, and to cause its
Subsidiaries to use, its reasonable efforts to take, or cause to be taken, all
actions, and to do, or cause to be done, all things necessary, proper or
advisable under applicable Laws, as promptly as practicable so as to permit
consummation of the Merger at the earliest possible date and to otherwise enable
consummation of the transactions contemplated hereby and shall cooperate fully
with the other Party hereto to that end (it being understood that any amendments
to the Registration Statement filed by Premier in connection with the Premier
Common Stock to be issued in the Merger shall not violate this covenant),
including, without limitation, using its reasonable efforts to lift or rescind
any Order adversely affecting its ability to consummate the transactions
contemplated herein and to cause to be satisfied the conditions referred to in
Article 9 of this Agreement. Each Party shall use, and shall cause each of its
Subsidiaries to use, its reasonable efforts to obtain all Consents necessary or
desirable for the consummation of the transactions contemplated by this
Agreement.
8.6 Investigation and Confidentiality.
----------------------------------
(a) Prior to the Effective Time, each Party will keep the other
Party advised of all material developments relevant to its business and to
consummation of the Merger and shall permit the other Party to make or cause to
be made such investigation of the business and properties of it and its
Subsidiaries and of their respective financial and legal conditions as the other
Party reasonably requests, provided that such investigation shall be reasonably
related to the transactions contemplated hereby and shall not interfere
unnecessarily with normal operations. No investigation by a Party shall affect
the representations and warranties of the other Party.
(b) Each Party shall, and shall cause its advisers and agents to,
maintain the confidentiality of all confidential information furnished to it by
the other Party concerning its and its Subsidiaries' businesses, operations, and
financial positions and shall not use such information for any purpose except in
furtherance of the transactions contemplated by this Agreement. If this
Agreement is terminated prior to the Effective Time, each Party shall promptly
return or certify the destruction of all documents and copies thereof and all
work papers containing confidential information received from the other Party.
29
(c) Each Party agrees to give the other Party notice as soon as
practicable after any determination by it of any fact or occurrence relating to
the other Party which it has discovered through the course of its investigation
and which represents, or is reasonably likely to represent, either a material
breach of any representation, warranty, covenant or agreement of the other Party
or which has had or is reasonably likely to have a Material Adverse Effect on
the other Party.
8.7 Press Releases. Prior to the Effective Time, Premier and North
---------------
▇▇▇▇▇▇ shall agree with each other as to the form and substance of any press
release or other public disclosure materially related to this Agreement or any
other transaction contemplated hereby; provided, however, that nothing in this
Section 8.7 shall be deemed to prohibit any Party from making any disclosure
which its counsel deems necessary or advisable in order to satisfy such Party's
disclosure obligations imposed by Law.
8.8 Acquisition Proposals. Except with respect to this Agreement and
----------------------
the transactions contemplated hereby, neither North ▇▇▇▇▇▇ nor any Affiliate
thereof nor any investment banker, attorney, accountant or other representative
(collectively, "Representatives") retained by North ▇▇▇▇▇▇ shall directly or
indirectly solicit any Acquisition Proposal by any Person. Except to the extent
necessary to comply with the fiduciary duties of North ▇▇▇▇▇▇'▇ Board of
Directors as advised by counsel, neither North ▇▇▇▇▇▇ nor any Affiliate or
Representative thereof shall furnish any non-public information that it is not
legally obligated to furnish, negotiate with respect to, or enter into any
Contract with respect to, any Acquisition Proposal, but North ▇▇▇▇▇▇ may
communicate information about such an Acquisition Proposal to its shareholders
if and to the extent that it is required to do so in order to comply with its
legal obligations as advised by counsel. North ▇▇▇▇▇▇ shall promptly notify
Premier orally and in writing in the event that it receives any inquiry or
proposal relating to any such transaction. Unless the prior written consent of
Premier is obtained, North ▇▇▇▇▇▇ shall (a) immediately cease and cause to be
terminated any existing activities, discussions or negotiations with any Persons
conducted heretofore with respect to any of the foregoing, and (b) direct and
use its reasonable efforts to cause all of its Representatives not to engage in
any of the foregoing.
8.9 Accounting and Tax Treatment. Each of the Parties undertakes and
----------------------------
agrees to use its reasonable efforts to cause the Merger to qualify, and to take
no action which would cause the Merger not to qualify, for treatment as a
"reorganization" within the meaning of Section 368(a) of the Internal Revenue
Code for federal income tax purposes. Each of the Parties further undertakes
and agrees to use its reasonable best efforts to cause the Merger to be
eligible, and to take no action which would cause the Merger not to be accounted
for as a "pooling of interests."
8.10 Agreement of Affiliates. North ▇▇▇▇▇▇ has disclosed in Section 8.10
-----------------------
of the North ▇▇▇▇▇▇ Disclosure Memorandum all Persons whom it reasonably
---------------------
believes is an "affiliate" of North ▇▇▇▇▇▇ for purposes of Rule 145 under the
1933 Act. North ▇▇▇▇▇▇ shall use its reasonable efforts to cause each such
Person to deliver to Premier and North ▇▇▇▇▇▇, not later than thirty (30) days
after the date of this Agreement, a written agreement, substantially in the form
of Exhibit 1, providing that such Person will not sell, pledge, transfer or
---------
otherwise dispose of the shares of North ▇▇▇▇▇▇
30
Common Stock held by such Person except as contemplated by such agreement or by
this Agreement and will not sell, pledge, transfer or otherwise dispose of the
shares of Premier Common Stock to be received by such Person upon consummation
of the Merger except in compliance with applicable provisions of the 1933 Act
and the rules and regulations thereunder. Premier shall be entitled to place
restrictive legends upon certificates for shares of Premier Common Stock issued
to Affiliates of North ▇▇▇▇▇▇ pursuant to this Agreement to enforce the
provisions of this Section 8.10. Premier shall not be required to maintain the
effectiveness of the Registration Statement under the 1933 Act for the purposes
of resale of Premier Common Stock by such Affiliates.
8.11 Employee Benefits and Contracts.
--------------------------------
(a) Following the Effective Time, Premier shall provide generally
to officers and employees of the North ▇▇▇▇▇▇ Companies who continue employment
with Premier or its Subsidiaries following the Effective Time employee benefits
under employee benefit plans, on terms and conditions which when taken as a
whole are substantially similar to those currently provided by the Premier
Companies to their similarly situated officers and employees. For purposes of
participation under such employee benefit plans, the service of the employees of
the North ▇▇▇▇▇▇ Companies prior to the Effective Time shall be treated as
service with a Premier Company participating in such employee benefit plans,
provided that, with respect to any employee benefit plan where the benefits are
funded through insurance, the granting of such benefits shall be subject to the
consent of the appropriate insurer and may be conditioned upon an employee's
participation in a North ▇▇▇▇▇▇ Benefit Plan of the same type immediately prior
to the Effective Time.
(b) Premier and its Subsidiaries also shall honor in accordance
with their terms all employment, severance, consulting and other compensation
Contracts disclosed in Section 8.11 of the North ▇▇▇▇▇▇ Disclosure Memorandum to
---------------------
Premier between any North ▇▇▇▇▇▇ Company and any current or former director,
officer, or employee thereof and all provisions for vested benefits accrued
through the Effective Time under the North ▇▇▇▇▇▇ Benefit Plans.
8.12 Severance Payments to ▇▇▇▇▇▇ National Bank Directors. Each member
-----------------------------------------------------
of the Board of Directors of North ▇▇▇▇▇▇ as of the Effective Time shall be
entitled to receive a severance payment from Premier in the amount of $25,000 in
exchange for a one (1) year non-competition/non-solicitation agreement from
such director in such form as Premier may reasonably request. Said severance
payment shall be delivered at the Effective Time. The one (1) year non-
competition/non-solicitation period shall commence on the date such director no
longer serves as a member of the Board of Directors of ▇▇▇▇▇▇ National Bank or
of the Board of Directors of any Premier Company.
8.13 Separation Agreement. ▇▇▇▇▇▇ National Bank and Grant R. Essex shall
---------------------
enter into a Separation Agreement dated as of the Effective Time in
substantially the form attached hereto as Exhibit "5".
-----------
31
ARTICLE IX
CONDITIONS PRECEDENT TO OBLIGATIONS TO CONSUMMATE
-------------------------------------------------
9.1 Conditions to Obligations of Each Party. The respective obligations
---------------------------------------
of each Party to perform this Agreement and consummate the Merger and the other
transactions contemplated hereby are subject to the satisfaction of the
following conditions, unless waived by both Parties pursuant to Section 11.6 of
this Agreement:
(a) Shareholder Approval. The shareholders of North ▇▇▇▇▇▇ shall have
---------------------
approved this Agreement, and the consummation of the transactions contemplated
hereby, including the Merger, as and to the extent required by Law, the American
Stock Exchange or by the provisions of any governing instruments.
(b) Regulatory Approvals. All Consents of, filings and registrations
---------------------
with, and notifications to all Regulatory Authorities required for consummation
of the Merger shall have been obtained or made and shall be in full force and
effect and all waiting periods required by Law shall have expired. No Consent
obtained from any Regulatory Authority which is necessary to consummate the
transactions contemplated hereby shall be conditioned or restricted in a manner
(including, without limitation, requirements relating to the raising of
additional capital or the disposition of Assets) which in the reasonable
judgment of the Board of Directors of either Party would so materially adversely
impact the economic or business benefits of the transactions contemplated by
this Agreement as to render inadvisable the consummation of the Merger.
(c) Consents and Approvals. Each Party shall have obtained any and
-----------------------
all Consents required for consummation of the Merger (other than those referred
to in Section 9.1(b) of this Agreement) or for the preventing of any Default
under any Contract or Permit of such Party which, if not obtained or made, is
reasonably likely to have, individually or in the aggregate, a Material Adverse
Effect on such Party. No Consent so obtained which is necessary to consummate
the transactions contemplated hereby shall be conditioned or restricted in a
manner which in the reasonable judgment of the Board of Directors of either
Party would so materially adversely impact the economic or business benefits of
the transactions contemplated by this Agreement as to render inadvisable the
consummation of the Merger.
(d) Registration Statement. The Registration Statement shall be
----------------------
effective under the 1933 Act, no stop orders suspending the effectiveness of the
Registration Statement shall have been issued, no action, suit, proceeding or
investigation by the SEC to suspend the effectiveness thereof shall have been
initiated and be continuing, and all necessary approvals under state securities
Laws or the 1933 Act or 1934 Act relating to the issuance or trading of the
shares of Premier Common Stock issuable pursuant to the Merger shall have been
received.
(e) Exchange Listing. The shares of Premier Common Stock issuable
-----------------
pursuant to the Merger shall have been approved for listing on the American
Stock Exchange.
32
(f) Tax Matters. Premier and North ▇▇▇▇▇▇ shall have received a
------------
written opinion of counsel from ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ & ▇▇▇▇, PLLC, in form
reasonably satisfactory to them (the "Tax Opinion"), to the effect that for
federal income tax purposes (i) the Merger will constitute a reorganization
within the meaning of Section 368(a) of the Internal Revenue Code, (ii) the
exchange in the Merger of North ▇▇▇▇▇▇ Common Stock for Premier Common Stock
will not give rise to gain or loss to the shareholders of North ▇▇▇▇▇▇ with
respect to such exchange (except to the extent of any cash received), and (iii)
neither Premier nor North ▇▇▇▇▇▇ will recognize gain or loss as a consequence of
the Merger (except for income and deferred gain recognized pursuant to Treasury
regulations issued under Section 1502 of the Internal Revenue Code). In
rendering such Tax Opinion, counsel shall be entitled to rely upon
representations of officers of Premier and North ▇▇▇▇▇▇ reasonably satisfactory
in form and substance to such counsel.
(g) Affiliate Agreements. The Parties shall have received from each
---------------------
affiliate of North ▇▇▇▇▇▇ the affiliates letter referred to in Section 8.10
hereof.
(h) Pooling Letter. The Parties shall have received a letter from
---------------
Ernst & Young L.L.P. and ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, L.L.P., dated as of the Effective
Time, to the effect that the Merger will qualify for pooling-of-interests
accounting treatment under Accounting Principles Board Opinion No. 16 if closed
and consummated in accordance with this Agreement.
9.2 Conditions to Obligations of Premier. The obligations of Premier to
------------------------------------
perform this Agreement and consummate the Merger and the other transactions
contemplated hereby are subject to the satisfaction of the following conditions,
unless waived by Premier pursuant to Section 11.6(a) of this Agreement:
(a) Representations and Warranties. For purposes of this Section
-------------------------------
9.2(a), the accuracy of the representations and warranties of North ▇▇▇▇▇▇ set
forth or referred to in this Agreement shall be assessed as of the date of this
Agreement and as of the Effective Time with the same effect as though all such
representations and warranties had been made on and as of the Effective Time
(provided that representations and warranties which are confined to a specified
date shall speak only as of such date). The representations and warranties of
North ▇▇▇▇▇▇ set forth in Section 5.3 of this Agreement shall be true and
correct (except for inaccuracies which are de minimis in amount). The
representations and warranties of North ▇▇▇▇▇▇ set forth in Section 5.19,
Section 5.20 and Section 5.21 of this Agreement shall be true and correct in all
Material respects. There shall not exist inaccuracies in the representations
and warranties of North ▇▇▇▇▇▇ set forth in this Agreement (excluding the
representations and warranties set forth in Sections 5.3, 5.19, 5.20 and 5.21)
such that the aggregate effect of such inaccuracies would have, or is reasonably
likely to have, a Material Adverse Effect on North ▇▇▇▇▇▇; provided that, for
purposes of this sentence only, those representations and warranties which are
qualified by references to "Material" or "Material Adverse Effect" shall be
deemed not to include such qualifications.
(b) Performance of Agreements and Covenants. Each and all of the
----------------------------------------
agreements and covenants of North ▇▇▇▇▇▇ to be performed and complied with
pursuant to this Agreement and
33
the other agreements contemplated hereby prior to the Effective Time shall have
been duly performed and complied with in all Material respects.
(c) Certificates. North ▇▇▇▇▇▇ shall have delivered to Premier (i) a
-------------
certificate, dated as of the Effective Time and signed on its behalf by its
chief executive officer and its chief financial officer, to the effect that the
conditions of its obligations set forth in Sections 9.2(a) and 9.2(b) of this
Agreement have been satisfied, and (ii) certified copies of resolutions duly
adopted by North ▇▇▇▇▇▇'▇ Board of Directors and shareholders evidencing the
taking of all corporate action necessary to authorize the execution, delivery
and performance of this Agreement, and the consummation of the transactions
contemplated hereby, all in such reasonable detail as Premier and its counsel
shall request.
(d) Opinion of Counsel. North ▇▇▇▇▇▇ shall have delivered to Premier
-------------------
an opinion of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP, counsel to North ▇▇▇▇▇▇,
dated as of the Effective Time, in form reasonably satisfactory to Premier, as
to the matters set forth in Exhibit 2 hereto.
---------
(e) Claims/Indemnification Letters. Each of the directors and
-------------------------------
officers of North ▇▇▇▇▇▇ shall have executed and delivered to Premier letters in
substantially the form of Exhibit 3 hereto.
---------
(f) Litigation. No preliminary or permanent injunction or other order
-----------
by any federal or state court which prevents the consummation of the Merger
shall have been issued and shall remain in effect, nor any action therefor
initiated which, in the good faith judgment of the Board of Directors of
Premier, it is not in the best interests of the shareholders of Premier to
contest; and there shall not have been instituted or be pending any action or
proceeding by any United States federal or state government or governmental
agency or instrumentality (i) challenging or seeking to restrain or prohibit the
consummation of the Merger or seeking material damages in connection with the
Merger; or (ii) seeking to prohibit Premier's or the Surviving Corporation's
ownership or operation of all or a material portion of Premier's or North
▇▇▇▇▇▇'▇ business or assets, or compel Premier or the Surviving Corporation to
dispose of or hold separate all or a material portion of Premier's or North
▇▇▇▇▇▇'▇ business or assets as a result of the Merger, which, in any case, in
the reasonable judgment of Premier based upon a legal opinion from legal
counsel, could result in the relief sought being obtained.
(g) Convertible Subordinated Debentures. Prior to the Effective Time,
-----------------------------------
each of the holders of the Debentures, as set forth in Section 5.3(b) of the
North ▇▇▇▇▇▇ Disclosure Memorandum, shall have converted all of the Debentures
---------------------
into shares of North ▇▇▇▇▇▇ Common Stock pursuant to Section 4(a)(i) of the
Debentures. Immediately following said conversion, no indebtedness shall remain
owing to said holders under the Debentures.
(h) Support Agreements. Within ten (10) calendar days of the
------------------
execution of this Agreement, each of the directors of North ▇▇▇▇▇▇ shall have
executed and delivered to Premier a Support Agreement substantially in the form
of Exhibit 6 to this Agreement.
---------
34
(i) Piedmont Place Lease. North ▇▇▇▇▇▇ shall have received, prior to
--------------------
the Effective Time, the consent of The Realty Associates Fund III, L.P. ("Realty
Associates"), or its successor to the transactions contemplated by this
Agreement, pursuant to the provisions of that certain Lease Agreement between
▇▇▇▇▇▇ National Bank and Realty Associates dated January 10, 1997 (the "Piedmont
Place Lease"). Such consent shall specifically include the merger of ▇▇▇▇▇▇
National Bank into Premier Bank or any other Premier Subsidiary and the
assignment of the rights and duties under the Piedmont Place Lease to such
Premier Subsidiary.
9.3 Conditions to Obligations of North ▇▇▇▇▇▇. The obligations of North
-----------------------------------------
▇▇▇▇▇▇ to perform this Agreement and consummate the Merger and the other
transactions contemplated hereby are subject to the satisfaction of the
following conditions, unless waived by North ▇▇▇▇▇▇ pursuant to Section 11.6(b)
of this Agreement:
(a) Representations and Warranties. For purposes of this Section
-------------------------------
9.3(a), the accuracy of the representations and warranties of Premier set forth
or referred to in this Agreement shall be assessed as of the date of this
Agreement and as of the Effective Time with the same effect as though all such
representations and warranties had been made on and as of the Effective Time
(provided that representations and warranties which are confined to a specified
date shall speak only as of such date). The representations and warranties of
Premier set forth in Section 6.17 and Section 6.18 of this Agreement shall be
true and correct in all material respects. There shall not exist inaccuracies
in the representations and warranties set forth in this Agreement (excluding the
representations and warranties set forth in Sections 6.17 and 6.18) such that
the aggregate effect of such inaccuracies would have, or is reasonably likely to
have a Material Adverse Effect on Premier; provided that, for purposes of this
sentence only, those representations and warranties which are qualified by
reference to "Material" or "Material Adverse Effect" shall be deemed not to
include such qualifications.
(b) Performance of Agreements and Covenants. Each and all of the
----------------------------------------
agreements and covenants of Premier to be performed and complied with pursuant
to this Agreement and the other agreements contemplated hereby prior to the
Effective Time shall have been duly performed and complied with in all material
respects.
(c) Certificates. Premier shall have delivered to North ▇▇▇▇▇▇ (i) a
-------------
certificate, dated as of the Effective Time and signed on its behalf by its
chief executive officer and its chief financial officer, to the effect that the
conditions of its obligations set forth in Section 9.3(a) and 9.3(b) of this
Agreement have been satisfied, and (ii) certified copies of resolutions duly
adopted by Premier's Board of Directors evidencing the taking of all corporate
action necessary to authorize the execution, delivery and performance of this
Agreement, and the consummation of the transactions contemplated hereby, all in
such reasonable detail as North ▇▇▇▇▇▇ and its counsel shall request.
35
(d) Opinion of Counsel. Premier shall have delivered to North ▇▇▇▇▇▇
------------------
an opinion of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ & ▇▇▇▇, PLLC, counsel to Premier, dated
as of the Effective Time, in form reasonably acceptable to North ▇▇▇▇▇▇, as to
matters set forth in Exhibit 4 hereto.
---------
(e) North ▇▇▇▇▇▇ Fairness Opinion. North ▇▇▇▇▇▇ shall have received
-----------------------------
from ▇▇▇▇▇, ▇▇▇▇▇ Capital Partners, Inc. a letter, dated not more than five (5)
business days prior to the date of the Proxy Statement, to the effect that, in
the opinion of such firm, the consideration to be paid to North ▇▇▇▇▇▇
shareholders in connection with the Merger is fair, from a financial point of
view, to the shareholders of North ▇▇▇▇▇▇.
(f) Litigation. No preliminary or permanent injunction or other order
----------
by any federal or state court which prevents the consummation of the Merger
shall have been issued and shall remain in effect, nor any action therefor
initiated which, in the good faith judgment of the Board of Directors of North
▇▇▇▇▇▇, it is not in the best interests of the shareholders of North ▇▇▇▇▇▇ to
contest; and there shall not have been instituted or be pending any action or
proceeding by any United States federal or state government or governmental
agency or instrumentality (i) challenging or seeking to restrain or prohibit the
consummation of the Merger or seeking material damages in connection with the
Merger; or (ii) seeking to prohibit Premier's or the Surviving Corporation's
ownership or operation of all or a material portion of Premier's or North
▇▇▇▇▇▇'▇ business or assets, or compel Premier or the Surviving Corporation to
dispose of or hold separate all or a material portion of Premier's or North
▇▇▇▇▇▇'▇ business or assets as a result of the Merger, which, in any case, in
the reasonable judgment of North ▇▇▇▇▇▇ based upon a legal opinion from legal
counsel, could result in the relief sought being obtained.
ARTICLE X
TERMINATION
-----------
10.1 Termination. Notwithstanding any other provision of this Agreement,
-----------
and notwithstanding the approval of this Agreement by the shareholders of North
▇▇▇▇▇▇, 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 North ▇▇▇▇▇▇ and
the Board of Directors of Premier; or
(b) By the Board of Directors of either Party (provided that the
terminating Party is not then in breach of any representation or warranty
contained in this Agreement under the applicable standard set forth in Section
9.2(a) of this Agreement in the case of North ▇▇▇▇▇▇ and Section 9.3(a) in the
case of Premier or in Material breach of any covenant or agreement contained in
this Agreement) in the event of a material breach by the other Party of any
representation or warranty contained in this Agreement which cannot be or has
not been cured within thirty (30) days after the giving of written notice to the
breaching Party of such breach and which breach would provide the non-breaching
Party the ability to refuse to consummate the Merger under the standard set
forth in Section 9.2(a) of this Agreement in the case of Premier and Section
9.3(a) of this Agreement in the case of North ▇▇▇▇▇▇; or
36
(c) By the Board of Directors of either Party (provided that the
terminating Party is not then in breach of any representation or warranty
contained in this Agreement under the applicable standard set forth in Section
9.2(a) of this Agreement in the case of North ▇▇▇▇▇▇ and Section 9.3(a) in the
case of Premier or in the Material breach of any covenant or other agreement
contained in this Agreement) in the event of a Material breach by the other
Party of any covenant or agreement contained in this Agreement which cannot be
or has not been cured within thirty (30) days after the giving of written notice
to the breaching Party of such breach; or
(d) By the Board of Directors of either Party in the event (provided
that the terminating Party is not then in breach of any representation or
warranty contained in this Agreement under the applicable standard set forth in
Section 9.2(a) of this Agreement in the case of North ▇▇▇▇▇▇ and Section 9.3(a)
in the case of Premier or in the material breach of any covenant or agreement
contained in this Agreement) (i) any Consent of any Regulatory Authority
required for consummation of the Merger and the other transactions contemplated
hereby shall have been denied by final nonappealable action of such authority or
if any action taken by such authority is not appealed within the time limit for
appeal, or (ii) if the shareholders of North ▇▇▇▇▇▇ fail to vote their approval
of this Agreement and the transactions contemplated hereby as required by the
GBCC at the Shareholders' Meeting where the transactions were presented to such
shareholders for approval and voted upon; or
(e) By the Board of Directors of either Party in the event that the
Merger shall not have been consummated on or before November 30, 1999, but only
if the failure to consummate the transactions contemplated hereby on or before
such date is not caused by any breach of this Agreement by the Party electing to
terminate pursuant to this Section 10.1(e); or
(f) By the Board of Directors of either Party (provided that the
terminating Party is not then in breach of any representation or warranty
contained in this Agreement under the applicable standard set forth in Section
9.2(a) of this Agreement in the case of North ▇▇▇▇▇▇ and Section 9.3(a) in the
case of Premier or in the material breach of any covenant or other agreement
contained in this Agreement) in the event that any of the conditions precedent
to the obligations of such Party to consummate the Merger (other than as
contemplated by Section 10.1(d) of this Agreement) cannot be satisfied or
fulfilled by the date specified in Section 10.1(e) of this Agreement; or
(g) By the Board of Directors of either Party on or before two (2)
business days following the business day of receipt of the Disclosure
----------
Memorandum of the other Party (which receipt shall not be later than April 8,
----------
1999), in the event that such Party, after a review of the Disclosure Memorandum
---------------------
provided by the other Party, determines not to proceed with the Merger.
10.2 Effect of Termination. In the event of the termination and
---------------------
abandonment of this Agreement pursuant to Section 10.1 of this Agreement, this
Agreement shall become void and have
37
no effect, except that the provisions of this Section 10.2 and Article 11 and
Section 8.6(b) of this Agreement shall survive any such termination and
abandonment.
10.3 Non-Survival of Representations and Covenants. The respective
---------------------------------------------
representations, warranties, obligations, covenants, and agreements of the
Parties shall not survive the Effective Time except for this Section 10.3 and
Articles 2, 3, 4 and 11 and Sections 8.10, 8.11 and 8.12 of this Agreement.
ARTICLE XI
MISCELLANEOUS
-------------
11.1 Definitions. Except as otherwise provided herein, the capitalized
-----------
terms set forth below (in their singular and plural forms as applicable) shall
have the following meanings:
"1933 Act" shall mean the Securities Act of 1933, as amended.
"1934 Act" shall mean the Securities Exchange Act of 1934, as amended.
"Acquisition Proposal" shall mean any tender offer or exchange offer or any
proposal for a merger (other than the Merger), acquisition of all of the stock
or Assets of, or other business combination involving North ▇▇▇▇▇▇ or any of its
Subsidiaries or the acquisition of a substantial equity interest in, or a
substantial portion of the Assets of North ▇▇▇▇▇▇ or any of its Subsidiaries.
"Affiliate" of a Person shall mean: (i) any other Person directly, or
indirectly through one or more intermediaries, controlling, controlled by or
under common control with such Person; (ii) any officer, director, partner, or
direct or indirect beneficial owner of any 10% or greater equity or voting
interest of such Person; or (iii) any other Person for which a Person described
in clause (ii) acts in such capacity.
"Agreement" shall mean this Agreement and Plan of Reorganization, including
the Exhibits delivered pursuant hereto and incorporated herein by reference.
"Allowance" shall have the meaning provided in Section 5.9 of this
Agreement.
"Assets" of a Person shall mean all of the assets, properties, businesses
and rights of such Person of every kind, nature, character and description,
whether real, personal or mixed, tangible or intangible, accrued or contingent,
or otherwise relating to or utilized in such Person's business, directly or
indirectly, in whole or in part, whether or not carried on the books and records
of such Person, and whether or not owned in the name of such Person or any
Affiliate of such Person and wherever located.
"BHC Act" shall mean the federal Bank Holding Company Act of 1956, as
amended.
38
"Closing" shall mean the closing of the transactions contemplated hereby,
as described in Section 1.2 of this Agreement.
"Closing Date" shall mean the date on which the Closing occurs.
"Consent" shall mean any consent, approval, authorization, clearance,
exemption, waiver, or similar affirmation by any Person pursuant to any
Contract, Law, Order, or Permit.
"Contract" shall mean any written or oral agreement, arrangement,
authorization, commitment, contract, indenture, instrument, lease, obligation,
plan, practice, restriction, understanding or undertaking of any kind or
character, or other document to which any Person is a party or that is binding
on any Person or its capital stock, Assets or business.
"Debentures" shall have the meaning provided in Section 5.3(b) of this
Agreement.
"Default" shall mean (a) any breach or violation of or default under any
Contract, Order or Permit, (b) any occurrence of any event that with the passage
of time or the giving of notice or both would constitute a breach or violation
of or default under any Contract, Order or Permit, or (c) any occurrence of any
event that with or without the passage of time or the giving of notice would
give rise to a right to terminate or revoke, change the current terms of, or
renegotiate, or to accelerate, increase, or impose any Liability under, any
Contract, Order or Permit.
"Effective Time" shall mean the date and time at which the Merger becomes
effective as defined in Section 1.3 of this Agreement.
"Environment" shall have the meaning specified in the Comprehensive
Environmental Response, Compensation and Liability Act, 42 U.S.C. (S) 9601(8).
"Environmental Laws" shall mean all Laws pertaining to pollution or
protection of the environment and which are administered, interpreted or
enforced by the United States Environmental Protection Agency and state and
local agencies with primary jurisdiction over pollution or protection of the
environment, including, without limitation, the Comprehensive Environmental
Response, Compensation and Liability Act, 42 U.S.C. (S) 9601 et. seq., the
-------
Resource, Conservation and Recovery Act, 42 U.S.C. (S) 6901 et. seq., the Toxic
-------
Substance Control Act, 15 U.S.C. (S) 2601, et. seq., and all implementing
-------
regulations and state counterparts of such acts.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
amended.
"ERISA Affiliate" shall refer to a relationship between entities such that
the entities would, now or at any time in the past, constitute a "single
employer" within the meaning of Section 414 of the Internal Revenue Code.
"ERISA Plan" shall have the meaning provided in Section 5.14 of this
Agreement.
39
"Exchange Ratio" shall have the meaning provided in Section 3.1 of this
Agreement.
"Exhibits" 1 through 4, inclusive, shall mean the Exhibits so marked,
copies of which are attached to this Agreement. Such Exhibits are hereby
incorporated by reference herein and made a part hereof and may be referred to
in this Agreement and any other related instrument or document without being
attached hereto.
"GAAP" shall mean generally accepted accounting principles, consistently
applied during the periods involved.
"GBCC" shall mean the Georgia Business Corporation Code.
"Georgia Certificate of Merger" shall mean the Certificate of Merger to be
executed by Premier and filed with the Secretary of State of the State of
Georgia relating to the Merger as contemplated by Section 1.1 of this Agreement.
"Hazardous Material" shall mean any substance which is a "hazardous
substance"or "toxic substance" as defined in the Comprehensive Environment
Response, Compensation, and Liability Act, 42 U.S.C. (S)9601 et seq., or any
------
other substance or material defined, designated, classified or regulated as
hazardous or toxic under any Environmental Law, specifically including asbestos
requiring abatement, removal or encapsulation pursuant to the requirements of
Environmental Laws of polychlorinated biphenyls, and petroleum and petroleum
products).
"Internal Revenue Code" shall mean the Internal Revenue Code of 1986, as
amended, and the rules and regulations promulgated thereunder.
"Knowledge" as used with respect to a Person shall mean the knowledge
after due inquiry of the Chairman, President, Chief Financial Officer, Chief
Accounting Officer, Chief Credit Officer, or any Senior or Executive Vice
President of such Person.
"Law" shall mean any code, law, ordinance, regulation, reporting or
licensing requirement, rule, or statute applicable to a Person or its Assets,
Liabilities or business, including, without limitation, those promulgated,
interpreted or enforced by any of the Regulatory Authorities.
"Liability" shall mean any direct or indirect, primary or secondary,
liability, indebtedness, obligation, penalty, cost or expense (including,
without limitation, costs of investigation, collection and defense), claim,
deficiency, guaranty or endorsement of or by any Person (other than endorsements
of notes, bills, checks, and drafts presented for collection or deposit in the
ordinary course of business) of any type, whether accrued, absolute or
contingent, liquidated or unliquidated, matured or unmatured, or otherwise.
"Lien" shall mean any conditional sale agreement, easement, encroachment,
encumbrance, hypothecation, infringement, lien, mortgage, pledge, reservation,
restriction, security interest, title retention or other security arrangement,
or any adverse right or interest, charge, or claim of any
40
nature whatsoever on, or with respect to, any property or property interest,
other than (i) Liens for current property Taxes not yet due and payable; (ii)
for depository institution Subsidiaries of a Party, pledges to secure deposits
and (iii) other Liens incurred in the ordinary course of the banking business.
"Litigation" shall mean any action, arbitration, cause of action, claim,
complaint, criminal prosecution, demand letter, governmental or other
examination or investigation, hearing, inquiry, administrative or other
proceeding, or notice (written or oral) by any Person alleging potential
Liability or requesting information relating to or affecting a Party, its
business, its Assets (including, without limitation, Contracts related to it),
or the transactions contemplated by this Agreement, but shall not include
regular, periodic examinations of depository institutions and their Affiliates
by Regulatory Authorities other than the violations of law section from such
reports.
"Loan Property" shall mean any property owned by the Party in question or
by any of its Subsidiaries or in which such Party or Subsidiary holds a security
interest, and, where required by the context, includes the owner or operator of
such property, but only with respect to such property.
"Material" for purposes of this Agreement shall be determined in light of
the facts and circumstances of the matter in question; provided that any
specific monetary amount stated in this Agreement shall determine materiality in
that instance.
"Material Adverse Effect" on a Party shall mean an event, change or
occurrence which has a material adverse impact on (a) the financial position,
business, or results of operations of such Party and its Subsidiaries, taken as
a whole, or (b) the ability of such Party to perform its obligations under this
Agreement or to consummate the Merger or the other transactions contemplated by
this Agreement, provided that "material adverse impact" shall not be deemed to
include the impact of (w) changes in banking and similar Laws of general
applicability or interpretations thereof by courts or governmental authorities,
(x) changes in GAAP or regulatory accounting principles generally applicable to
banks and their holding companies, (y) actions and omissions of a Party (or any
of its Subsidiaries) taken with the prior informed consent of the other Party in
contemplation of the transactions contemplated hereby, or (z) the Merger and
compliance with the provisions of this Agreement on the operating performance of
the Parties.
"Merger" shall mean the merger of North ▇▇▇▇▇▇ with and into Premier
referred to in Section 1.1 of this Agreement.
"▇▇▇▇▇▇ National Bank" shall mean ▇▇▇▇▇▇ National Bank, a national bank and
a North ▇▇▇▇▇▇ Subsidiary.
"NASD" shall mean the National Association of Securities Dealers, Inc.
"North ▇▇▇▇▇▇ Benefit Plans" shall have the meaning set forth in Section
5.14 of this Agreement.
41
"North ▇▇▇▇▇▇ Common Stock" shall mean the no par value common stock of
North ▇▇▇▇▇▇.
"North ▇▇▇▇▇▇ Companies" shall mean, collectively, North ▇▇▇▇▇▇ and all
North ▇▇▇▇▇▇ Subsidiaries.
"North ▇▇▇▇▇▇ Disclosure Memorandum" shall mean the written information
---------------------
entitled "North ▇▇▇▇▇▇ Disclosure Memorandum" delivered on or prior to April 8,
---------------------
1999 to Premier describing in reasonable detail the matters contained therein,
specifically referencing each Section of this Agreement under which such
disclosure is being made.
"North ▇▇▇▇▇▇ Financial Statements" shall mean (a) the consolidated balance
sheets (including related notes and schedules, if any) of North ▇▇▇▇▇▇ as of
December 31, 1998, and December 31, 1997 and 1996, and the related statements of
income, changes in shareholders' equity, and cash flows (including related notes
and schedules, if any) for each of the three fiscal years ended December 31,
1998, 1997 and 1996, included in the North ▇▇▇▇▇▇ Disclosure Memorandum, and (b)
---------------------
the consolidated balance sheets (including related notes and schedules, if any)
of North ▇▇▇▇▇▇ and related statements of income, changes in shareholders'
equity, and cash flows (including related notes and schedules, if any) with
respect to periods ended subsequent to December 31, 1998.
"North ▇▇▇▇▇▇ Options" shall have the meaning set forth in Section 3.4 of
this Agreement.
"North ▇▇▇▇▇▇ Stock Plans" shall mean the existing stock option and other
stock-based compensation plans of North ▇▇▇▇▇▇ disclosed in Section 5.14 of the
North ▇▇▇▇▇▇ Disclosure Memorandum.
---------------------
"North ▇▇▇▇▇▇ Subsidiaries" shall mean the subsidiaries of North ▇▇▇▇▇▇.
"Order" shall mean any administrative decision or award, decree,
injunction, judgment, order, quasi-judicial decision or award, ruling, or writ
of any federal, state, local or foreign or other court, arbitrator, mediator,
tribunal, administrative agency or Regulatory Authority.
"Participation Facility" shall mean any facility or property in which the
Party in question or any of its Subsidiaries participates in the management
(including any property or facility held in a joint venture) and, where required
by the context, said term means the owner or operator of such facility or
property, but only with respect to such facility or property.
"Party" shall mean either Premier or North ▇▇▇▇▇▇, and "Parties" shall mean
both Premier and North ▇▇▇▇▇▇.
"Permit" shall mean any federal, state, local, and foreign governmental
approval, authorization, certificate, easement, filing, franchise, license,
notice, permit, or right to which any Person is a party or that is or may be
binding upon or inure to the benefit of any Person or its securities, Assets,
Liabilities, or business.
42
"Person" shall mean a natural person or any legal, commercial or
governmental entity, such as, but not limited to, a corporation, general
partnership, joint venture, limited partnership, limited liability company,
trust, business association, group acting in concert, or any person acting in a
representative capacity.
"Premier Bank" shall mean Premier Bank, a Georgia state-chartered bank and
a Premier Subsidiary.
"Premier Common Stock" shall mean the $1.00 par value common stock of
Premier.
"Premier Companies" shall mean, collectively, Premier and all Premier
Subsidiaries.
"Premier Disclosure Memorandum" shall mean the written information entitled
---------------------
"Premier Disclosure Memorandum" delivered on or prior to April 8, 1999 to North
---------------------
▇▇▇▇▇▇ describing in reasonable detail the matters contained therein and, with
respect to each disclosure made therein, specifically referencing each Section
of this Agreement under which such disclosure is being made.
"Premier Financial Statements" shall mean (a) the consolidated balance
sheets (including related notes and schedules, if any) of Premier as of December
31, 1998, 1997 and 1996, and the related statements of income, changes in
shareholders' equity, and cash flows (including related notes and schedules, if
any) for each of the three years ended December 31, 1998, 1997 and 1996, and (b)
the consolidated balance sheets (including related notes and schedules, if any)
of Premier and related statements of income, changes in shareholders' equity,
and cash flows (including related notes and schedules, if any) included in SEC
Documents filed with respect to periods ended subsequent to December 31, 1998.
"Premier Stock Plans" shall mean the existing stock option and other stock-
based compensation plans of Premier.
"Premier Subsidiaries" shall mean the Subsidiaries of Premier at the
Effective Time.
"Proxy Statement" shall mean the proxy statement used by North ▇▇▇▇▇▇ to
solicit the approval of its shareholders of the transactions contemplated by
this Agreement which shall be included in the prospectus of Premier relating to
shares of Premier Common Stock to be issued to the shareholders of North ▇▇▇▇▇▇.
"Registration Statement" shall mean the Registration Statement on Form S-4,
or other appropriate form, filed with the SEC by Premier under the 1933 Act with
respect to the shares of Premier Common Stock to be issued to the shareholders
of North ▇▇▇▇▇▇ in connection with the transactions contemplated by this
Agreement and which shall include the Proxy Statement.
"Regulatory Authorities" shall mean, collectively, the Federal Trade
Commission, the United States Department of Justice, the Board of the Governors
of the Federal Reserve System, the Office of Thrift Supervision (including its
predecessor, the Federal Home Loan Bank Board), the
43
Office of the Comptroller of the Currency, the Federal Deposit Insurance
Corporation, all state regulatory agencies having jurisdiction over the Parties
and their respective Subsidiaries, the NASD and the SEC.
"Rights" shall mean all arrangements, calls, commitments, Contracts,
options, rights to subscribe to, scrip, understandings, warrants or other
binding obligations of any character whatsoever relating to, or securities or
rights convertible into or exchangeable for, shares of the capital stock of a
Person or by which a Person is or may be bound to issue additional shares of its
capital stock or other Rights.
"SEC" shall mean the United States Securities and Exchange Commission.
"SEC Documents" shall mean all forms, proxy statements, registration
statements, reports, schedules and other documents filed, or required to be
filed, by a Party or any of its Subsidiaries with any Regulatory Authority
pursuant to the Securities Laws.
"Securities Laws" shall mean the 1933 Act, the 1934 Act, the Investment
Company Act of 1940, as amended, the Investment Advisors Act of 1940, as
amended, the Trust Indenture Act of 1939, as amended, and the rules and
regulations of any Regulatory Authority promulgated thereunder.
"Shareholders' Meeting" shall mean the meeting of the shareholders of North
▇▇▇▇▇▇ to be held pursuant to Section 8.1 of this Agreement, including any
adjournment or adjournments thereof.
"Subsidiaries" shall mean all those corporations, banks, associations or
other entities of which the entity in question owns or controls 50% or more of
the outstanding equity securities either directly or through an unbroken chain
of entities as to each of which 50% or more of the outstanding equity
securities is owned directly or indirectly by its parent; provided, however,
there shall not be included any such entity acquired through foreclosure or any
such entity the equity securities of which are owned or controlled in a
fiduciary capacity.
"Support Agreements" shall mean the various Support Agreements, each in
substantially the form of Exhibit 6 to this Agreement.
---------
"Surviving Corporation" shall mean Premier as the surviving corporation
resulting from the Merger.
"Tax" or "Taxes" shall mean any federal, state, county, local or foreign
income, profits, franchise, gross receipts, payroll, sales, employment, use,
property, withholding, excise, occupancy and other taxes, assessments, charges,
fares or impositions, including interest, penalties and additions imposed
thereon or with respect thereto.
"Year 2000 Problem" shall mean any problem affecting the ability of any
Party or its Subsidiaries to continue operation as an ongoing business or to
provide the usual and customary
44
services of any Party or its Subsidiaries, relating to the failure of software,
hardware or other computer equipment to: (a) store all date-related information
and process all data interfaces involving dates in a manner that unambiguously
identifies the century, for all date values before, during or after the Year
2000; (b) calculate, sort, report and otherwise operate correctly and in a
consistent manner for all date information processed by any software, hardware
or other computer equipment, whether before, during or after the Year 2000; (c)
calculate, sort, report and otherwise operate correctly, in a consistent manner
and without interruption regardless whether the date on which the software,
hardware or other computer equipment is operated or executed is before, during
or after the Year 2000; (d) report and display all dates with a four-digit date
so that the century is unambiguously identified; and (e) handle all leap years,
including but not limited to the Year 2000 leap year, correctly.
Any singular term in this Agreement shall be deemed to include the plural, and
any plural term the singular. Whenever the words "include," "includes," or
"including" are used in this Agreement, they shall be deemed followed by the
words "without limitation."
11.2 Expenses.
--------
(a) Except as otherwise provided in this Section 11.2, each of the
Parties shall bear and pay all direct costs and expenses incurred by it or on
its behalf in connection with the transactions contemplated hereunder, including
filing, registration and application fees, printing fees, and fees and expenses
of its own financial or other consultants, investment bankers, accountants and
counsel, except that each of the Parties shall bear and pay (i) one-half of the
filing fees payable in connection with the Registration Statement and the
applications filed with other Regulatory Authorities, and (ii) one-half of the
costs incurred in connection with the printing or copying of the Proxy
Statements.
(b) Notwithstanding the provisions of Section 11.2(a) of this
Agreement, if for any reason this Agreement is terminated pursuant to Sections
10.1(b) or 10.1(c) of this Agreement, the breaching Party agrees to pay the non-
breaching Party (i) an amount equal to the reasonable and documented fees and
expenses incurred by such non-breaching Party in connection with the examination
and investigation of the breaching Party, the preparation and negotiation of
this Agreement and related agreements, regulatory filings and other documents
related to the transactions contemplated hereunder, including, without
limitation, fees and expenses of investment banking consultants, accountants,
attorneys and other agents and (ii) $1,000,000 if the breach is willful or this
Agreement is terminated in contemplation of an Acquisition Proposal, which sums
represent compensation for the non-breaching Party's loss as a result of the
transactions contemplated by this Agreement not being consummated. Final
settlement with respect to payment of such fees and expenses shall be made
within thirty (30) days after the termination of this Agreement. This Section
11.2(b) shall be the non-breaching Party's sole and exclusive remedy for
actionable breach by the breaching Party under this Agreement.
11.3 Brokers and Finders. Each of the Parties represents and warrants
-------------------
that neither it nor any of its officers, directors, employees or Affiliates has
employed any broker or finder or incurred
45
any Liability for any financial advisory fees, investment bankers' fees,
brokerage fees, commissions, or finders' fees in connection with this Agreement
or the transactions contemplated hereby, other than ▇▇▇▇▇, ▇▇▇▇▇ Capital
Partners, Inc. employed by North ▇▇▇▇▇▇ and The ▇▇▇▇▇▇▇▇-▇▇▇▇▇▇▇▇ Company
employed by Premier. In the event of a claim by any broker or finder based upon
his or its representing or being retained by or allegedly representing or being
retained by Premier or North ▇▇▇▇▇▇, each of Premier and North ▇▇▇▇▇▇, as the
case may be, agrees to indemnify and hold the other Party harmless of and from
any Liability in respect of any such claim.
11.4 Entire Agreement. Except as otherwise expressly provided herein,
----------------
this Agreement (including the documents and instruments referred to herein)
constitutes the entire agreement between the Parties with respect to the
transactions contemplated hereunder and supersedes all prior arrangements or
understandings with respect thereto, written or oral. Nothing in this Agreement
expressed or implied, is intended to confer upon any Person, other than the
Parties or their respective successors, any rights, remedies, obligations, or
liabilities under or by reason of this Agreement, other than as provided in
Section 8.10 of this Agreement.
11.5 Amendments. To the extent permitted by Law, this Agreement may be
----------
amended by a subsequent writing signed by each of the Parties upon the approval
of the Boards of Directors of each of the Parties; provided, however, that after
any such approval by the holders of North ▇▇▇▇▇▇ Common Stock, there shall be
made no amendment that pursuant to the GBCC requires further approval by such
shareholders without the further approval of such shareholders.
11.6 Waivers.
-------
(a) Prior to or at the Effective Time, Premier, acting through its
Board of Directors, chief executive officer or other authorized officer, shall
have the right to waive any Default in the performance of any term of this
Agreement by North ▇▇▇▇▇▇, to waive or extend the time for the compliance or
fulfillment by North ▇▇▇▇▇▇ of any and all of its obligations under this
Agreement, and to waive any or all of the conditions precedent to the
obligations of Premier under this Agreement, except any condition which, if not
satisfied, would result in the violation of any Law. No such waiver shall be
effective unless in writing and signed by a duly authorized officer of Premier.
(b) Prior to or at the Effective Time, North ▇▇▇▇▇▇, acting through
its Board of Directors, chief executive officer or other authorized officer,
shall have the right to waive any Default in the performance of any term of this
Agreement by Premier, to waive or extend the time for the compliance or
fulfillment by Premier of any and all of its obligations under this Agreement,
and to waive any or all of the conditions precedent to the obligations of North
▇▇▇▇▇▇ under this Agreement, except any condition which, if not satisfied, would
result in the violation of any Law. No such waiver shall be effective unless in
writing and signed by a duly authorized officer of North ▇▇▇▇▇▇.
(c) The failure of any Party at any time or times to require
performance of any provision hereof shall in no manner affect the right of such
Party at a later time to enforce the same
46
or any other provision of this Agreement. No waiver of any condition or of the
breach of any term contained in this Agreement in one or more instances shall be
deemed to be or construed as a further or continuing waiver of such condition or
breach or a waiver of any other condition or of the breach of any other term of
this Agreement.
11.7 Assignment. Except as expressly contemplated hereby, neither this
----------
Agreement nor any of the rights, interests or obligations hereunder shall be
assigned by any Party hereto (whether by operation of Law or otherwise) without
the prior written consent of the other Party. Subject to the preceding sentence,
this Agreement will be binding upon, inure to the benefit of and be enforceable
by the Parties and their respective successors and assigns.
11.8 Notices. All notices or other communications which are required or
-------
permitted hereunder shall be in writing and sufficient if delivered by hand, by
facsimile transmission, or by courier or overnight carrier, 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:
Premier: Premier Bancshares, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopy Number: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Chairman and CEO
Copy to Counsel: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ & ▇▇▇▇, PLLC
Suite 700
1275 Peachtree Street, N.E.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopy Number: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
North ▇▇▇▇▇▇: North ▇▇▇▇▇▇ Bancshares, Inc.
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopy Number: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Chairman of the Board
47
Copy to Counsel: Powell, Goldstein, ▇▇▇▇▇▇ & ▇▇▇▇▇▇, LLP
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopy Number: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
11.9 Governing Law. This Agreement shall be governed by and construed in
-------------
accordance with the Laws of the State of Georgia, without regard to any
applicable conflicts of Laws, except to the extent that the federal laws of the
United States may apply to the Merger.
11.10 Counterparts. This Agreement may be executed in one or more
------------
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.
11.11 Captions. The captions contained in this Agreement are for
--------
reference purposes only and are not part of this Agreement.
11.12 Enforcement of Agreement. The Parties hereto agree that irreparable
------------------------
damage would occur in the event that any of the provisions of this Agreement was
not performed in accordance with its specific terms or was otherwise breached.
It is accordingly agreed that the Parties shall be entitled to an injunction or
injunctions to prevent breaches of this Agreement and to enforce specifically
the terms and provisions hereof in any court of the United States or any state
having jurisdiction, this being in addition to any other remedy to which they
are entitled at law or in equity.
11.13 Severability. Any term or provision of this Agreement which is
------------
invalid or unenforceable in any jurisdiction shall, as to that jurisdiction, be
ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining terms and provisions of this
Agreement or affecting the validity or enforceability of any of the terms or
provisions of this Agreement in any other jurisdiction. If any provision of
this Agreement is so broad as to be unenforceable, the provision shall be
interpreted to be only so broad as is enforceable.
48
IN WITNESS WHEREOF, each of the Parties has caused this Agreement to be
executed on its behalf and its corporate seal to be hereunto affixed and
attested by officers thereunto as of the day and year first above written.
ATTEST: PREMIER BANCSHARES, INC.
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇ By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------------- ------------------------------
Secretary ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Chairman and Chief Executive Officer
[CORPORATE SEAL]
ATTEST: NORTH ▇▇▇▇▇▇ BANCSHARES, INC.
/s/ Grant R. Essex By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------- -----------------------------------
Secretary ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Chairman of the Board
[CORPORATE SEAL]
49
EXHIBIT 1
---------
AFFILIATE AGREEMENT
Premier Bancshares, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
North ▇▇▇▇▇▇ Bancshares, Inc.
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Gentlemen:
The undersigned is a shareholder of North ▇▇▇▇▇▇ Bancshares, Inc. ("North
▇▇▇▇▇▇"), a corporation organized and existing under the laws of the State of
Georgia, and will become a shareholder of Premier Bancshares, Inc. ("Premier" or
the "Surviving Corporation") pursuant to the transactions described in the
Agreement and Plan of Reorganization, dated as of April 6,1999 (the
"Agreement"), by and between North ▇▇▇▇▇▇ and Premier. Under the terms of the
Agreement, Premier and North ▇▇▇▇▇▇ will be merged (the "Merger") and the shares
of common stock of North ▇▇▇▇▇▇ ("North ▇▇▇▇▇▇ Common Stock") will be converted
into shares of common stock of the Surviving Corporation ("Surviving Corporation
Common Stock"). This Affiliate Agreement represents an agreement between the
undersigned and the Surviving Corporation regarding certain rights and
obligations of the undersigned in connection with the shares of the Surviving
Corporation to be received by the undersigned as a result of the Merger.
In consideration of the Merger and the mutual covenants contained herein,
the undersigned and the Surviving Corporation hereby agree as follows:
1. Affiliate Status. The undersigned understands and agrees that as to
----------------
North ▇▇▇▇▇▇ the undersigned is an "affiliate" under Rule 145(c) as defined in
Rule 405 of the Rules and Regulations of the Securities and Exchange Commission
("SEC") under the Securities Act of 1933, as amended ("1933 Act"), and the
undersigned anticipates that the undersigned will be such an "affiliate" at the
time of the Merger.
2. Initial Restriction on Disposition. The undersigned agrees that the
----------------------------------
undersigned will not, except by operation of law, by will or under the laws of
descent and distribution, sell, transfer, or otherwise dispose of the
undersigned's interests in, or reduce the undersigned's risk relative to, any of
the shares of the Surviving Corporation Common Stock into which the
undersigned's shares of North ▇▇▇▇▇▇ Common Stock are converted upon
consummation of the Merger until such time as
1
the Surviving Corporation notifies the undersigned that the requirements of SEC
Accounting Series Release Nos. 130 and 135 ("ASR 130 and 135") have been met.
The undersigned understands that ASR 130 and 135 relate to publication of
financial results of post-Merger combined operations of the Surviving
Corporation and North ▇▇▇▇▇▇. The Surviving Corporation agrees that it will
publish such results within 45 days after the end of the first fiscal quarter of
the Surviving Corporation containing the required period of post-Merger combined
operations and that it will notify the undersigned promptly following such
publication.
3. Covenants and Warranties of Undersigned. The undersigned represents,
---------------------------------------
warrants and agrees that:
(a) During the 30 days immediately preceding the effective time of the
Merger, the undersigned will not, except by operation of law, by will, or
under the laws of descent and distribution, sell, transfer, or otherwise
dispose of the undersigned's interests in, or reduce the undersigned's risk
relative to, any of the shares of North ▇▇▇▇▇▇ Common Stock beneficially
owned by the undersigned as of the date of the shareholders' meeting of
North ▇▇▇▇▇▇ held to approve the merger.
(b) The Surviving Corporation Common Stock received by the undersigned
as a result of the Merger will be taken for the undersigned's own account
and not for others, directly or indirectly, in whole or in part.
(c) The undersigned understands that any distribution by the
undersigned of the Surviving Corporation Common Stock has not been
registered under the 1933 Act and that shares of the Surviving Corporation
Common Stock received pursuant to the Merger can only be sold by the
undersigned (1) following registration under the 1933 Act, or (2) in
conformity with the volume and other requirements of Rule 145(d)
promulgated by the SEC as the same now exist or may hereafter be amended,
or (3) to the extent some other exemption from registration under the 1933
Act might be available. The undersigned understands that the Surviving
----------------------------------------------
Corporation is under no obligation to file a registration statement with
------------------------------------------------------------------------
the SEC covering the disposition of the undersigned's shares of the
-------------------------------------------------------------------
Surviving Corporation Common Stock.
-----------------------------------
4. Restrictions on Transfer. The undersigned understands and agrees that
------------------------
stop transfer instructions with respect to the shares of the Surviving
Corporation Common Stock received by the undersigned pursuant to the Merger will
be given to the Surviving Corporation's transfer agent and that there will be
placed on the certificates for such shares, or shares issued in substitution
thereof, a legend stating in substance:
"The shares represented by this certificate were issued pursuant to a
business combination which is accounted for as a "pooling of
interests" and may not be sold, nor may the owner thereof reduce his
risks relative thereto in any way, until such time as the Surviving
Corporation has published the financial results covering at least 30
days of combined operations after the effective
3
date of the merger through which the business combination was
effected. In addition, the shares represented by this certificate may
not be sold, transferred or otherwise disposed of except or unless (a)
covered by an effective registration statement under the Securities
Act of 1933, as amended, (b) in accordance with (i) Rule 145(d) (in
the case of shares issued to an individual who is not an affiliate of
the Surviving Corporation) or (ii) Rule 144 (in the case of shares
issued to an individual who is an affiliate of the Surviving
Corporation) of the Rules and Regulations of such Act, or (c) in
accordance with a legal opinion satisfactory to counsel for the
Surviving Corporation that such sale or transfer is otherwise exempt
from the registration requirements of such Act."
Such legend will also be placed on any certificate representing the Surviving
Corporation securities issued subsequent to the original issuance of the
Surviving Corporation Common Stock pursuant to the Merger as a result of any
stock dividend, stock split or other recapitalization as long as the Surviving
Corporation Common Stock issued to the undersigned pursuant to the Merger has
not been transferred in such manner to justify the removal of the legend
therefrom. If the provisions of Rules 144 and 145 are amended to eliminate
restrictions applicable to the Surviving Corporation Common Stock received by
the undersigned pursuant to the Merger, or at the expiration of the restrictive
period set forth in Rule 145(d), the Surviving Corporation, upon the request of
the undersigned, will cause the certificates representing the shares of the
Surviving Corporation Common Stock issued to the undersigned in connection with
the Merger to be reissued free of any legend relating to the restrictions set
forth in Rules 144 and 145(d) upon receipt by the Surviving Corporation of an
opinion of its counsel to the effect that such legend may be removed.
5. Understanding of Restrictions on Dispositions. The undersigned has
---------------------------------------------
carefully read the Agreement and this Affiliate Agreement and discussed their
requirements and impact upon his or her ability to sell, transfer or otherwise
dispose of the shares of the Surviving Corporation Common Stock received by the
undersigned, to the extent the undersigned believes necessary, with the
undersigned's counsel or counsel for North ▇▇▇▇▇▇.
6. Filing of Reports by the Surviving Corporation. The Surviving
----------------------------------------------
Corporation agrees, for a period of three years after the effective date of the
Merger, to file on a timely basis all reports required to be filed by it
pursuant to Section 13 of the Securities Exchange Act of 1934, as amended, so
that the public information provisions of Rule 145(d) promulgated by the SEC as
the same are presently in effect will be available to the undersigned in the
event the undersigned desires to transfer any shares of the Surviving
Corporation Common Stock issued to the undersigned pursuant to the Merger.
7. Transfer Under Rule 145(d). If the undersigned desires to sell or
--------------------------
otherwise transfer the shares of the Surviving Corporation Common Stock received
by the undersigned in connection with the Merger at any time during the
restrictive period set forth in Rule 145(d), the undersigned will provide the
necessary representation letter to the transfer agent for the Surviving
Corporation Common Stock together with such additional information as the
transfer agent may reasonably
3
request. If the Surviving Corporation's counsel concludes that such proposed
sale or transfer complies with the requirements of Rule 145(d), the Surviving
Corporation shall cause such counsel to provide such opinions as may be
necessary to the Surviving Corporation's transfer agent so that the undersigned
may complete the proposed sale or transfer.
8. Acknowledgments. The undersigned recognizes and agrees that the
---------------
foregoing provisions also apply to (a) the undersigned's spouse, (b) any
relative of the undersigned or of the undersigned's spouse who has the same home
as the undersigned, (c) any trust or estate in which the undersigned, the
undersigned's spouse, and any such relative collectively own at least a 10%
beneficial interest or of which any of the foregoing serves as trustee, executor
or in any similar capacity and (d) any corporation or other organization in
which the undersigned, the undersigned's spouse and any such relative
collectively own at least 10% of any class of equity securities or of the equity
interest. The undersigned further recognizes that, in the event that the
undersigned is a director or officer of the Surviving Corporation or becomes a
director or officer of the Surviving Corporation upon consummation of the
Merger, among other things, any sale of the Surviving Corporation Common Stock
by the undersigned within a period of less than six months following the
effective time of the Merger may subject the undersigned to liability pursuant
to Section 16(b) of the Securities Exchange Act of 1934, as amended.
9. Miscellaneous. This Affiliate Agreement is the complete agreement
-------------
between the Surviving Corporation and the undersigned concerning the subject
matter hereof. Any notice required to be sent to any party hereunder shall be
sent by registered or certified mail, return receipt requested, using the
addresses set forth herein or such other address as shall be furnished in
writing by the parties. This Affiliate Agreement shall be governed by the laws
of the State of Georgia.
4
This Affiliate Agreement is executed as of the_____ day of April, 1999.
Very truly yours,
___________________________________
Signature
___________________________________
Print Name
AGREED TO AND ACCEPTED as of
April __, 1999
PREMIER BANCSHARES, INC.
By:_____________________________
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Chairman
and Chief Executive Officer
AGREED TO AND ACCEPTED as of
April __, 1999
NORTH ▇▇▇▇▇▇ BANCSHARES, INC.
By:_____________________________
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Chairman
5
EXHIBIT 2
---------
MATTERS AS TO WHICH
COUNSEL TO NORTH ▇▇▇▇▇▇ WILL OPINE*
1. North ▇▇▇▇▇▇ is a corporation duly organized, existing and in good
standing under the laws of the State of Georgia with corporate power and
authority to conduct its business as now conducted and to own and use its
Assets.
2. North ▇▇▇▇▇▇'▇ authorized capital stock consists of 10,000,000 shares
of North ▇▇▇▇▇▇ Common Stock, of which 1,828,821 shares were outstanding as of
the date hereof. The outstanding shares of North ▇▇▇▇▇▇ Common Stock are duly
authorized, validly issued, fully paid and nonassessable. None of the
outstanding shares of North ▇▇▇▇▇▇ Common Stock has been issued in violation of
any statutory preemptive rights. Except as disclosed in North ▇▇▇▇▇▇'▇
Disclosure Memorandum dated April __, 1999, to our knowledge, there are no
---------------------
options, subscriptions, warrants, calls, rights or commitments obligating North
▇▇▇▇▇▇ to issue equity securities or acquire its equity securities.
3. The execution and delivery by North ▇▇▇▇▇▇ of the Agreement do not,
and if North ▇▇▇▇▇▇ were now to perform its obligations under the Agreement such
performance would not, result in any violation of the Articles of Incorporation
or Bylaws of any North ▇▇▇▇▇▇ Company, or, to our knowledge, result in any
breach of, or default or acceleration under, any material Contract or Order to
which a North ▇▇▇▇▇▇ Company is a party or by which a North ▇▇▇▇▇▇ Company is
bound.
4. North ▇▇▇▇▇▇ has duly authorized the execution and delivery of the
Agreement and all performance by North ▇▇▇▇▇▇ thereunder and has duly executed
and delivered the Agreement.
5. The Agreement is enforceable against North ▇▇▇▇▇▇.
______________________________
*Pursuant to the January 1, 1992 edition of the Interpretive Standards
Applicable to Legal Opinions to Third Parties in Corporate Transactions adopted
by the Legal Opinion Committee of the Corporate and Banking Law Section of the
State Bar of Georgia.
1
EXHIBIT 3
---------
CLAIMS/INDEMNIFICATION LETTER
April __, 1999
Premier Bancshares, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
This letter is delivered pursuant to Section 9.2(e) of the Agreement and
Plan of Reorganization (the "Agreement"), dated as of April 6, 1999, by and
between North ▇▇▇▇▇▇ Bancshares, Inc. ("North ▇▇▇▇▇▇") and Premier Bancshares,
Inc. ("Premier") which provides for the merger (the "Merger") of North ▇▇▇▇▇▇
and Premier.
Concerning claims which I may have against North ▇▇▇▇▇▇ or its wholly-owned
subsidiary, ▇▇▇▇▇▇ National Bank, in my capacity as an officer or director:
(a) Premier shall assume all liability (to the extent North ▇▇▇▇▇▇ was
so liable) for claims for indemnification arising under North ▇▇▇▇▇▇'▇
Articles of Incorporation or Bylaws or under any indemnification contract
disclosed to Premier, as existing on March 31, 1999, and for claims for
salaries, wages or other compensation, employee benefits, reimbursement of
expenses, or worker's compensation arising out of employment through the
effective time of the Merger;
(b) ▇▇▇▇▇▇ National Bank shall retain all liability (to the extent it
was so liable) for claims for indemnification arising under its Articles of
Incorporation or Bylaws as existing on March 31, 1999, and for claims for
salaries, wages, or other compensation, employee benefits, reimbursement of
expenses, or worker's compensation arising out of employment through the
effective time of the Merger;
(c) In my capacity as an officer or a director, I am not aware that I
have any claims (other than those referred to in paragraphs (a) or (b)
above) against North ▇▇▇▇▇▇ or ▇▇▇▇▇▇ National Bank (other than routine
deposit, loan and other banking services conducted in the ordinary course
of business with North ▇▇▇▇▇▇ or ▇▇▇▇▇▇ National Bank;
(d) I hereby release North ▇▇▇▇▇▇ and ▇▇▇▇▇▇ National Bank from any
and all claims which I am aware that I have against any of them in my
capacity as an officer or a director, other than those referred to in
paragraphs (a) or (b) above.
1
By executing this letter on behalf of Premier, you shall acknowledge the
assumption by Premier of the liabilities described in paragraphs (a) and (b)
above.
Sincerely,
__________________________________
Signature of Officer or Director
__________________________________
Printed Name of Officer or Director
On behalf of Premier, I hereby acknowledge receipt of this letter and
affirm the assumption by Premier of the liabilities described in paragraph (a)
and (b) above, as of this _____ day of _______________, 1999.
PREMIER BANCSHARES, INC.
By: ___________________________________________________
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Chairman and Chief Executive
Officer
2
EXHIBIT 4
---------
MATTERS AS TO WHICH
COUNSEL TO PREMIER WILL OPINE*
1. Premier is a corporation in existence under the laws of the State of
Georgia with corporate power to carry on its business as now conducted.
2. Premier's authorized capital stock consists of 60,000,000 common
shares, of which 26,102,975 shares are issued and outstanding as of the date
hereof and 2,000,000 preferred shares of which 40,770 shares are issued and
outstanding as of the date hereof. The outstanding shares of Premier Common
Stock are duly authorized by all necessary corporate action on the part of
Premier and are validly issued, fully paid and nonassessable. None of the
outstanding shares of Premier Common Stock has been issued in violation of any
statutory preemptive rights.
3. The shares of Premier Common Stock to be issued in exchange for North
▇▇▇▇▇▇ Common Stock upon consummation of the Merger have been duly authorized by
all necessary corporate action and, when issued as provided for in the
Agreement, will be validly issued, fully paid and nonassessable. None of the
shares of Premier Common Stock to be exchanged for North ▇▇▇▇▇▇ Common Stock
upon consummation of the Merger will be issued in violation of any statutory
preemptive rights.
4. The execution and delivery by Premier of the Agreement and the
consummation by Premier of the transactions provided in the Agreement: (a) do
not violate any provision of the Articles of Incorporation or Bylaws of any
Premier Company, and (b) do not violate or constitute a breach of, or a default
under, any material Contract or Order to which a Premier Company is a party.
5. The Agreement has been duly executed and delivered by Premier and is
enforceable against Premier.
* subject to customary assumptions and limitations
1
EXHIBIT 5
---------
SEPARATION AGREEMENT
THIS SEPARATION AGREEMENT ("Agreement") is made and entered into as of
the ___ day of _______, 1999, by and among ▇▇▇▇▇▇ NATIONAL BANK ("Employer"), a
bank chartered under the laws of the United States, and GRANT R. ESSEX
("Employee"), a resident of Georgia.
W I T N E S S E T H:
WHEREAS, Employer is the wholly-owned subsidiary of North ▇▇▇▇▇▇
Bancshares, Inc., a Georgia corporation;
WHEREAS, North ▇▇▇▇▇▇ Bancshares, Inc. will merge with and into
Premier Bancshares, Inc. (the "Holding Company") and, as a result, Employer
shall become the wholly-owned subsidiary of the Holding Company (the "Merger");
WHEREAS, it is anticipated that Employer will subsequently merge with
and into Premier Bank, another wholly-owned subsidiary of the Holding Company,
and, as of the effective date of such merger, all references to the term
"Employer" shall include Premier Bank;
WHEREAS, Employee currently serves as President and Chief Executive
Officer of Employer and will continue serving in such capacities after the
Merger as an employee-at-will;
WHEREAS, Employer and Employee have entered into a Separation
Agreement, dated as of December 15, 1998; and
WHEREAS, the parties have determined that it will be mutually
beneficial for Employee to terminate such Separation Agreement and execute a new
agreement;
NOW, THEREFORE, for and in consideration of the mutual covenants
herein contained, and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto do hereby agree
as follows:
1. Effective Date. This Agreement shall become effective as of the same
--------------
date on which the Merger becomes effective (the "Effective Date").
2. Termination of December 15, 1998 Separation Agreement. Effective as of
-----------------------------------------------------
the Effective Date, Employee and Employer mutually agree to terminate the
Separation Agreement dated December 15, 1998.
3. Payment to Employee Upon Termination of Employment. If, within one (1)
--------------------------------------------------
year following the Effective Date, Employee's employment is terminated for any
reason, other than a
Termination for Cause (as defined below), then Employer shall pay to Employee a
sum equal to $240,000.00, which sum (i) shall be paid within thirty (30) days of
----------
the effective date of Employee's termination, (ii) shall be in satisfaction of
all claims arising out of or related to the employment of Employee by Employer
and (iii) shall be in consideration of the Restrictive Covenants contained in
paragraphs 5, 6 and 7 hereof. This payment shall be payable whether the
termination is voluntary or involuntary, unless said termination is a
Termination for Cause. For purposes of this Agreement, a "Termination for Cause"
shall mean a termination because of: Employee's personal dishonesty; breach of
fiduciary duties involving personal profit; willful violation of any law, rule,
or regulation (other than traffic violations or similar offenses); willful
violation of a final cease-and-desist order; the regulatory suspension or
removal of Employee; or a material breach by Employee of any provision of this
Agreement following notice given to Employee by Employer and a thirty (30)-day
right to cure such breach after said notice.
4. Payment to Employee One Year After Termination of Employment. If
------------------------------------------------------------
Employee qualifies for a payment under paragraph 3 above, then Employer shall
pay to Employee or, in the event of Employee's death, to Employee's legal
representative(s), a sum equal to $240,000.00 on the first anniversary of the
-----------
effective date of Employee's termination of employment; provided that Employee
shall not be entitled to payment hereunder if Employee is in breach of the
Restrictive Covenants, and provided further that Employee shall refund in full
to Employer, upon demand, any sums paid under this paragraph 4 in the event
Employee shall violate any of the Restrictive Covenants contained in paragraphs
5, 6 and 7 hereof. The payment under this paragraph shall be additional
consideration for the restrictive covenants set forth hereafter and shall be in
full and final satisfaction of all claims arising out of or related to the
employment of Employee by Employer or relating to this Agreement.
5. Nondisclosure of Confidential Information. Employee acknowledges that
-----------------------------------------
he now possesses and will possess confidential information of a special and
unique nature and value affecting and relating to the business of Employer,
Premier Bank and the Holding Company (collectively, the "Protected Parties"),
including, without limitation, customer lists, deposits, business records, other
trade secrets, and other similar confidential information relating to the
Protected Parties and the business of each (collectively, "Confidential
Information"). Employee recognizes and acknowledges that all Confidential
Information is the exclusive property of the Protected Parties, respectively,
constitutes trade secrets of the Protected Parties, is material and
confidential, and greatly affects the goodwill and business of the Protected
Parties. As a material inducement to Employer to enter into this Agreement, and
to continue the employ of Employee, Employee covenants and agrees that he will
not at any time during the term of his employment, and for a period of two (2)
years from the end of such employment, directly or indirectly, divulge, reveal,
or communicate any Confidential Information to any person, firm, corporation, or
entity whatsoever (other than the Protected Parties), or use any Confidential
Information for his own benefit or for the benefit of others. Employee further
acknowledges that said Confidential Information has material commercial value to
the Protected Parties so long as it is not known by competitors of the Protected
Parties and that the Protected Parties have taken reasonable steps to keep all
such information and trade secrets confidential.
6. Non-piracy of Employees. For the period of time beginning on the
-----------------------
Effective Date and ending two (2) years after Employee's termination of
employment, for any reason, including
2
a Termination for Cause, Employee covenants and agrees that he shall not,
directly or indirectly, hire or attempt to hire, or assist anyone in hiring, any
officer, director, or employee of the Protected Parties that performed work for
the Protected Parties within the last twelve (12) months preceding the
termination of Employee's employment with Employer, or those employees who are
engaged or employed with the Protected Parties at the time of Employee's
termination or resignation, for a Competitive Business. A "Competitive Business"
is a business engaged in the banking or financial services businesses that is
offering services and/or products identical or similar to those offered by
Employer during Employee's employment with Employer. Employee has been hired by
Employer to work in the business defined herein as "Competitive Business," and
has worked for such business prior to the Effective Date, and Employee hereby
acknowledges the reasonableness of this provision.
7. Non-solicitation of Customers And Noncompete.
--------------------------------------------
(a) For the period of time beginning on the Effective Date and ending
two (2) years after Employee's termination of employment for any reason,
including a Termination for Cause, Employee agrees not to, directly or
indirectly, solicit or call upon any customers/clients of Employer with whom
Employee has had material personal contact at any time during the last two (2)
years of Employee's employment with Employer, including prospective
customers/clients of Employer with whom Employee had such contact during said
two-year period, if the purpose of such solicitation is to solicit these
customers/clients or prospective customers/clients for a Competitive Business as
defined in paragraph 6, including but not limited to any Competitive Business
started by Employee. Employee acknowledges that due to his employment with
Employer, he has and will develop special contacts and relationships with
Employer's clients and prospects while on Employer's payroll, and that it would
be unfair and harmful to Employer if Employee took advantage of these
relationships in a Competitive Business.
(b) For the period of time beginning the Effective Date and ending two
(2) years after Employee's termination of employment for any reason, including a
Termination for Cause, Employee agrees not to, directly or indirectly, compete
with Employer, as an officer, director, member, shareholder (other than a
shareholder in a company that is publicly traded and so long as such ownership
is less than three percent [3%]), owner, partner, employee, or independent
contractor, by working for or engaging in a Competitive Business as defined in
paragraph 6, in a capacity identical or similar to the capacity Employee served
for Employer, in any Competitive Business located in the Territory. For
purposes of this paragraph, the "Territory" is the Georgia counties of ▇▇▇▇▇▇,
Gwinnett, Forsyth and ▇▇▇▇. Employee acknowledges the reasonableness of this
limitation on his ability to compete with Employer, including the reasonableness
of the Territory.
(c) Employee understands and agrees that the terms and provisions of
paragraphs 5, 6 and 7 (the "Restrictive Covenants") are not intended to restrict
Employee in the exercise of his skills or the use of knowledge or information
that does not rise to the level of a trade secret under applicable law or to the
level of Confidential Information set forth in paragraph 5 above. Employee
acknowledges and agrees that the purpose of the Restrictive Covenants is to
prevent Employee from unfairly taking advantage of the contacts he has
3
established while with Employer, but not to preclude Employee's opportunity to
engage in his occupation in any unrelated and non-competitive field of endeavor,
or to engage in directly competitive endeavors so long as they meet the
requirements of this Agreement. Employee represents that his experience and
abilities are such that the existence or enforcement of these provisions will
not prevent him from earning an adequate livelihood and/or will not cause an
undue burden to himself or his family. Employee acknowledges the reasonableness
of these provisions.
(d) Employee and Employer acknowledge that the performance by Employee
of bona fide general consulting services, whether as self-employed or as an
employee of a third party, to a Competitive Business in the Territory would not
necessarily violate (although it could violate) the provisions of paragraphs 5,
6 and 7(a) hereof, directly or indirectly, depending upon Employee's activities
as a general consultant.
8. Injunctions. In view of the irreparable harm and damage which the
-----------
Protected Parties would sustain as a result of a breach by Employee of the
Restrictive Covenants, and in view of the lack of an adequate remedy at law to
protect the Protected Parties' interests, the Protected Parties shall have the
right to receive, and Employee hereby consents to the issuance of, a preliminary
and a permanent injunction enjoining Employee from any violation of the
Restrictive Covenants, which injunction shall be of a duration consistent with
the provisions hereof. The foregoing remedy shall be in addition to, and not in
limitation of, any other rights or remedies to which the Protected Parties are
or may be entitled at law or in equity respecting this Agreement. Employee
acknowledges and agrees that the existence of any claim or cause of action
against Employer shall not constitute a defense to the enforcement by Employee
of Employee's covenants, obligations or undertakings in this Agreement.
9. Federal Income Tax Withholding. Employer may withhold from any
------------------------------
benefits payable under this Agreement all federal, state, city, or other taxes
as shall be required pursuant to any law or governmental regulation or ruling.
10. Effect of Prior Agreements. This Agreement contains the entire
--------------------------
understanding between the parties hereto and supersedes any prior written
agreements and any contemporaneous oral agreements or understandings by,
between, or among Employer and Employee with respect to Employee's employment or
termination of employment. Employee waives and releases any and all rights,
demands, causes of actions, or claims relating to or arising out of the
Separation Agreement dated December 15, 1998, his employment by Employee or any
rights accruing to Employee under any severance or separation policy adopted by
Employer. Other than the payments set forth herein in paragraphs 3 and 4,
Employee's rights, if any, in any incentive stock plan maintained by the Holding
Company or rights to receive COBRA continuation benefits, Employee is entitled
to no other payments or benefits upon termination of employment.
11. General Provisions.
------------------
(a) Nonassignability. The respective rights of the Protected Parties
----------------
may be assigned by the Protected Parties. Neither this Agreement nor any right
or interest hereunder shall be
4
assignable by Employee, his beneficiaries or legal representatives, without the
written consent of Employer; provided, however, that nothing in this paragraph
11(a) shall preclude (i) Employee from designating a beneficiary to receive any
benefits payable hereunder upon his death, or (ii) the executors,
administrators, or other legal representatives of Employee or his estate from
assigning any rights hereunder to the person or persons entitled thereto.
(b) No Attachment. Except as required by law, no right to receive
-------------
payments under this Agreement shall be subject to anticipation, commutation,
alienation, sale, assignment, encumbrance, charge, pledge, or hypothecation, or
to execution, attachment, levy, and any attempt, voluntary or involuntary, to
effect any such action shall be null, void, and of no effect.
(c) Binding Agreement. This Agreement shall be binding upon, and
-----------------
inure to the benefit of, Employer and Employee and their respective heirs,
successors, assigns, and legal representatives.
(d) Amendment of Agreement. This Agreement may not be modified or
----------------------
amended except by an instrument in writing, signed by the parties hereto, and
which specifically refers to this Agreement.
(e) Waiver. No term or condition of this Agreement shall be deemed to
------
have been waived, nor shall there be any estoppel against the enforcement of any
provision of this Agreement, except by written instrument of the party charged
with such waiver or estoppel. No such written waiver shall be deemed a
continuing waiver unless specifically stated therein, and each waiver shall
operate only as to the specific term or condition waived and shall not
constitute a waiver of such term or condition for the future or as to any act
other than that specifically waived.
(f) Severability. If for any reason any provision of this Agreement
------------
is held invalid, such invalidity shall not affect any other provision of this
Agreement not held invalid, and each such other provision shall to the full
extent consistent with law continue in full force and effect. If any provision
of this Agreement shall be held invalid in part, such invalidity shall in no way
affect the rest of such provision not held so invalid, and the rest of such
provision, together with all other provisions of this Agreement, shall to the
full extent consistent with law continue in full force and effect.
(g) Headings. The headings of paragraphs herein are included solely
--------
for convenience of reference and shall not control the meaning or interpretation
of any of the provisions of this Agreement.
(h) Governing Law. This Agreement has been executed and delivered in
-------------
the State of Georgia, and its validity, interpretation, performance, and
enforcement shall be governed by the laws of said State.
12. Rights of Third Parties. Nothing herein expressed or implied is
-----------------------
intended to or shall be construed to confer upon or give to any person, firm, or
other entity, other than the parties hereto and their permitted assigns, any
rights or remedies under or by reason of this
5
Agreement; provided, however, that the Holding Company and Premier Bank are
intended third-party beneficiaries of this Agreement for the purposes of
enforcing the restricted covenants set forth herein.
13. Notices. All notices, requests, demands, and other communications
-------
provided for by this Agreement shall be in writing and shall be sufficiently
given if and when mailed in the United States by registered or certified mail,
or personally delivered, to the party entitled thereto at the address stated
below or to such changed address as the addressee may have given by a similar
notice:
To Employer: Chairman, Compensation Committee
Board of Directors
Premier Bancshares, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇. ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
-and-
Copy to: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ & ▇▇▇▇, PLLC
One Atlantic Center
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
To Employee: ▇▇. ▇▇▇▇▇ R. Essex
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
IN WITNESS WHEREOF, Employer has caused this Agreement to be
executed and its seal to be affixed hereunto by its duly authorized officers,
and Employee has signed this Agreement, as of the Effective Date.
ATTEST: ▇▇▇▇▇▇ NATIONAL BANK
-------------------------- By:
Secretary ------------------------------------
Its:
---------------------------------
[BANK SEAL]
(SEAL)
-------------------------- ---------------------------------
Witness GRANT R. ESSEX
6
EXHIBIT 6
---------
SUPPORT AGREEMENT
-----------------
THIS SUPPORT AGREEMENT ("Agreement") is made and entered into as of
the _____ day of April, 1999, by and between the undersigned,
_____________________, a resident of ____________, Georgia, and Premier
Bancshares, Inc., a corporation organized and existing under the laws of the
State of Georgia ("Premier").
Premier and North ▇▇▇▇▇▇ Bancshares, Inc., a corporation organized and
existing under the laws of the State of Georgia ("North ▇▇▇▇▇▇"), have entered
into an Agreement and Plan of Reorganization, dated as of April 6, 1999 (the
"Merger Agreement"). The Merger Agreement generally provides for the merger of
North ▇▇▇▇▇▇ into Premier (the "Merger") and the conversion of the issued and
outstanding shares of the no par value common stock of North ▇▇▇▇▇▇ ("North
▇▇▇▇▇▇ Common Stock") into shares of the $1.00 par value common stock of
Premier. The Merger Agreement is subject to the affirmative vote of the
shareholders of North ▇▇▇▇▇▇, the receipt of certain regulatory approvals, and
the satisfaction of other conditions.
The undersigned is a member of the Board of Directors of North ▇▇▇▇▇▇
and is the owner of ________ shares of North ▇▇▇▇▇▇ Common Stock and has rights
by option or otherwise to acquire _______ additional shares of North ▇▇▇▇▇▇
Common Stock (collectively, the "Shares"). In order to induce Premier to enter
into the Merger Agreement, the undersigned is entering into this Agreement with
Premier to set forth certain terms and conditions governing the actions to be
taken by the undersigned solely in his capacity as a shareholder of North ▇▇▇▇▇▇
with respect to the Shares until consummation of the Merger.
NOW, THEREFORE, in consideration of the transactions contemplated by
the Merger Agreement and the mutual promises and covenants contained herein, the
parties agree as follows:
1. Without the prior written consent of Premier, which consent shall
not be unreasonably withheld, the undersigned shall not transfer, sell, assign,
convey, or encumber any of the Shares during the term of this Agreement except
for transfers (i) by operation of law, by will, or pursuant to the laws of
descent and distribution, (ii) in which the transferee shall agree in writing to
be bound by the provisions of paragraphs 1, 2, and 3 of this Agreement as fully
as the undersigned, or (iii) to Premier pursuant to the terms of the Merger
Agreement. Without limiting the generality of the foregoing, the undersigned
shall not grant to any party any option or right to purchase the Shares or any
interest therein. Further, except with respect to the Merger, the undersigned
shall not during the term of this Agreement approve or ratify any agreement or
contract pursuant to which the Shares would be transferred to any other party as
a result of a consolidation, merger, share exchange, or acquisition.
2. The undersigned intends to, and will, vote (or cause to be voted)
all of the Shares over which the undersigned has voting authority (other than in
a fiduciary capacity) in favor of the Merger Agreement and the Merger at any
meeting of shareholders of North ▇▇▇▇▇▇ called to vote on the Merger Agreement
or the Merger or the adjournment thereof or in any other circumstance upon which
a vote, consent, or other approval with respect to the Merger Agreement or the
Merger is sought. Further, the undersigned intends to, and will, surrender the
certificate or certificates representing the Shares over which the undersigned
has dispositive authority to Premier upon consummation of the Merger as
described in the Merger Agreement and hereby waives any rights of appraisal, or
rights to dissent from the Merger, that the undersigned may have.
3. Except as otherwise provided in this Agreement, at any meeting of
shareholders of North ▇▇▇▇▇▇ or at any adjournment thereof or any other
circumstances upon which their vote, consent, or other approval is sought, the
undersigned will vote (or cause to be voted) all of the Shares over which the
undersigned has voting authority (other than in a fiduciary capacity) against
(i) any merger agreement, share exchange, or merger (other than the Merger
Agreement and the Merger), consolidation, combination, sale of substantial
assets, merger, recapitalization, dissolution, liquidation, or winding-up of or
by North ▇▇▇▇▇▇ or (ii) any amendment of North ▇▇▇▇▇▇'▇ Articles of
Incorporation or Bylaws or other proposal or transaction involving North ▇▇▇▇▇▇
or any of its subsidiaries, which amendment or other proposal or transaction
would in any manner impede, frustrate, prevent, or nullify the Merger, the
Merger Agreement, or any of the other transactions contemplated thereby.
4. The undersigned acknowledges and agrees that Premier could not be
made whole by monetary damages in the event of any default by the undersigned of
the terms and conditions set forth in this Agreement. It is accordingly agreed
and understood that Premier, in addition to any other remedy which it may have
at law or in equity, shall be entitled to an injunction or injunctions to
prevent breaches of this Agreement and specifically to enforce the terms and
provisions hereof in any action instituted in any court of the United States or
in any state having appropriate jurisdiction.
5. Any term or provision of this Agreement which is invalid or
unenforceable in any jurisdiction shall, as to that jurisdiction, be ineffective
to the extent of such invalidity or unenforceability without rendering invalid
or unenforceable the remaining terms and provisions of this Agreement or
affecting the validity or enforceability of any of the terms or provisions of
this Agreement in any other jurisdiction. If any provision of this Agreement is
so broad as to be unenforceable, the provision shall be interpreted to be only
so broad as is enforceable.
6. The covenants and obligations set forth in this Agreement shall
expire and be of no further force and effect on the earlier of: (i) November 30,
1999, or such date to which the Merger Agreement is extended; or (ii) the date
on which the Merger Agreement is terminated under Section 10.1 thereof.
2
IN WITNESS WHEREOF, this Agreement has been duly executed and
delivered by the undersigned as of the day and year first above written.
As to the undersigned,
signed in the presence of:
____________________________ ______________________________
Name:
__________________________
(Please print or type)
PREMIER BANCSHARES, INC.
By:
_________________________________________
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Chairman of the
Board and Chief Executive Officer
3