EXHIBIT 2.1
AGREEMENT AND PLAN OF MERGER
DATED AS OF OCTOBER 17, 2003
BETWEEN
THE TRUST COMPANY OF FLORIDA
AND
FIRST NATIONAL BANCSHARES, INC.
AND
1ST NATIONAL BANK & TRUST
AGREEMENT AND PLAN OF MERGER
TABLE OF CONTENTS
ARTICLE I DEFINITIONS; INTERPRETATION........................................ 1
1.01 Definitions........................................................ 1
ARTICLE II THE MERGER......................................................... 7
2.01 The Merger......................................................... 7
2.02 Manner of Converting and Exchanging Trust Company Shares........... 7
2.03 Effective Time..................................................... 11
ARTICLE III ACTIONS PENDING THE EFFECTIVE TIME................................. 11
3.01 Forbearances of Trust Company...................................... 11
3.02 Forbearances of FNBI and the Bank.................................. 13
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF TRUST COMPANY.................... 13
4.01 Organization, Standing and Authority............................... 13
4.02 Corporate Authority and Action..................................... 13
4.03 Regulatory Filings; No Defaults.................................... 14
4.04 Capital Stock...................................................... 14
4.05 Subsidiaries....................................................... 14
4.06 Financial Statements............................................... 14
4.07 Absence of Certain Changes......................................... 15
4.08 Contracts.......................................................... 16
4.09 Contracts With Clients............................................. 17
4.10 Registrations and Licenses......................................... 17
4.11 Compliance With Laws............................................... 17
4.12 Regulatory Reports................................................. 18
4.13 Properties......................................................... 18
4.14 Taxes.............................................................. 18
4.15 Litigation......................................................... 19
4.16 Employees; Labor Matters........................................... 19
4.17 Employee Benefit Plans............................................. 19
4.18 Environmental Matters.............................................. 21
4.19 Internal Controls.................................................. 21
4.20 Names and Trademarks............................................... 22
4.21 Insurance.......................................................... 22
4.22 No Brokers......................................................... 22
4.23 Books and Records.................................................. 22
ARTICLE V REPRESENTATIONS AND WARRANTIES OF FNBI AND THE BANK................ 22
5.01 Organization, Standing and Authority............................... 22
5.02 Corporate Power.................................................... 23
i
5.03 Corporate Authority................................................ 23
5.04 Regulatory Approvals; No Defaults.................................. 23
5.05 Financial Statements............................................... 23
5.06 Stock Issuable in the Merger....................................... 24
5.07 Absence of Certain Changes......................................... 24
5.08 Capital Stock...................................................... 24
5.09 SEC Reports........................................................ 24
5.10 Compliance with Laws............................................... 24
5.11 Material Contracts................................................. 25
5.12 Regulatory Reports................................................. 25
ARTICLE VI COVENANTS.......................................................... 25
6.01 Reasonable Best Efforts............................................ 25
6.02 Shareholder Approvals.............................................. 26
6.03 Access; Information................................................ 26
6.04 Acquisition Proposals.............................................. 27
6.05 Takeover Laws...................................................... 27
6.06 Regulatory Applications............................................ 27
6.07 "Tail" Policy for Director and Officer Liability Insurance......... 28
6.08 Notification of Certain Matters.................................... 28
6.09 Press Releases..................................................... 29
6.10 Certain Policies of Trust Company.................................. 29
ARTICLE VII CONDITIONS TO CONSUMMATION OF THE MERGER........................... 29
7.01 Conditions to Each Party's Obligation to Effect the Merger......... 29
7.02 Conditions to Obligation of Trust Company.......................... 30
7.03 Conditions to Obligation of FNBI and the Bank...................... 30
ARTICLE VIII TERMINATION........................................................ 31
8.01 Termination........................................................ 31
8.02 Effect of Termination and Abandonment.............................. 32
ARTICLE IX MISCELLANEOUS...................................................... 33
9.01 Survival........................................................... 33
9.02 Waiver; Amendment.................................................. 33
9.03 Counterparts....................................................... 33
9.04 Governing Law...................................................... 33
9.05 Expenses........................................................... 33
9.06 Notices............................................................ 33
9.07 Entire Understanding............................................... 34
9.08 No Third Party Beneficiaries....................................... 34
9.09 Interpretation..................................................... 35
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EXHIBITS
B Form of Shareholder Agreement
C Titles of Officers of The Trust Company after the Merger
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THIS AGREEMENT AND PLAN OF MERGER (this "Agreement") is dated as of
October 17, 2003, and is entered into by and among The Trust Company of Florida,
a nondepository trust company organized under the laws of the State of Florida
("Trust Company"), and First National Bancshares, Inc., a Florida corporation
("FNBI"), and 1st National Bank & Trust, a banking association organized under
the laws of the United States (the "Bank").
RECITALS
A. Trust Company is nondepository trust company organized under the
laws of the State of Florida, having its principal place of business in
Englewood, Florida.
B. FNBI is a Florida corporation and a bank holding company under the
Bank Holding Company Act of 1956, having its principal place of business in
Bradenton, Florida and owns all of the issued and outstanding stock of the Bank.
C. The Bank is a national banking association organized under the laws
of the United States, having its principal place of business in Bradenton,
Florida.
D. Subject to the terms and conditions contained in this Agreement, the
parties intend to effect the merger of Trust Company with and into the Bank.
E. The respective Boards of Directors of each of FNBI, the Bank and
Trust Company have determined that it is in the best interests of their
respective companies and their shareholders to consummate the transactions
provided for in this Agreement.
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants, representations, warranties and agreements contained herein, the
parties agree as follows:
ARTICLE I
DEFINITIONS; INTERPRETATION
1.01 Definitions. The following terms, as used in this Agreement,
have the meanings set forth below:
"Acquisition Proposal" has the meaning assigned in Section 6.04.
"Affiliate" means, with respect to any specified person, any other
person directly or indirectly controlling, controlled by or under common control
with such specified person. For the purposes of this definition, "control" when
used with respect to any specified person means the power to direct the
management and policies of such person, directly or indirectly, whether
through the ownership of voting securities, by Contract or otherwise; and the
terms "controlling" and "controlled" have correlative meanings to the foregoing.
"Agreement" means this Agreement, as amended or modified from time to
time in accordance with Section 9.02.
"Bank" means 1st National Bank & Trust, a national banking association
and a party to this Agreement.
"Client" means any person to which Trust Company provides products or
services under any Contract.
"Code" means the Internal Revenue Code of 1986, as amended.
"Compensation Plans" has the meaning assigned in Section 4.17(a).
"Consideration Amount" has the meaning assigned in Section 2.02(b).
"Contract" means any agreement, indenture, undertaking, debt
instrument, contract, lease or other commitment to which such person or any of
its Subsidiaries is a party or by which any of them is bound or to which any of
their properties is subject.
"DOL" means the United States Department of Labor.
"Department" means the Florida Department of Financial Services, the
primary regulator of Trust Company.
"Dissenting Trust Company Shareholders" has the meaning assigned in
Section 2.02(h).
"Disclosure Schedule" means the schedule which the Trust Company has
delivered to FNBI, on or prior to the date hereof, setting forth, among other
things, items the disclosure of which is necessary or appropriate either (1) in
response to an express informational requirement contained in or requested by a
provision hereof, or (2) as an exception to one or more representations or
warranties contained in Article IV, or to one or more of its covenants contained
in Article VI.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"ERISA Affiliate" has, with respect to any person, the meaning assigned
in Section 4.17(c).
"ERISA Plans" has the meaning assigned in Section 4.17(b).
"Effective Date" means the date on which the Effective Time occurs.
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"Effective Time" means the date and time at which the Merger becomes
effective.
"Employment Agreements" means the employment agreements to be entered
into between the Bank and ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇ and ▇▇▇▇▇ ▇▇▇▇▇▇, in
substantially the form contained in Exhibit A .
"Environmental Laws" means any federal, state or local law, regulation,
order, decree, permit, authorization, common law or agency requirement with
force of law relating to: (1) the protection or restoration of the environment,
health or safety (in each case as relating to the environment) or natural
resources, or (2) the handling, use, presence, disposal, release or threatened
release of any Hazardous Substance.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchange Agent" has the meaning assigned in Section 2.02(i)
"Executive Management" means all of the members of the Trust Company
Board of Directors and the executive officers of Trust Company.
"FBC" means the Florida Banking Code, Chapter 658 of the Florida
Statutes, and regulations promulgated thereunder.
"FDIC" means the Federal Deposit Insurance Corporation.
"Financial Statements" means, as to any party, the statements of
financial condition, statements of income, statements of cash flow and
statements of changes in shareholders' equity, including any related notes and
schedules.
"FNBI" means First National Bancshares, Inc., a Florida corporation,
bank holding company under the Bank Holding Company Act of 1956, parent company
of the Bank and one of the parties to this Agreement.
"FNBI Common Stock" means the common stock of FNBI, $0.10 par value per
share, some of which shares shall be issued to the shareholders of Trust Company
pursuant to the terms of this Agreement.
"FNBI Stock Price" has the meaning assigned in Section 2.02(g).
"GAAP" means generally accepted accounting principles.
"Governmental Authority" means any court, administrative agency or
commission or other federal, state or local governmental authority or
instrumentality.
"Hazardous Substance" means any hazardous or toxic substance, material
or waste, including those substances, materials and wastes listed in the United
States Department of
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Transportation Hazardous Materials Table (49 C.F.R. section 172.101), or by the
United States Environmental Protection Agency as hazardous substances (40 C.F.R.
Part 302) and amendments thereto, petroleum products or other such substances,
materials and wastes that are or become regulated under any applicable local,
state or federal law.
"IRS" means the Internal Revenue Service.
"Insurance Policies" has the meaning assigned in Section 4.21.
"Investment Advisers Act" means the Investment Advisers Act of 1940, as
amended, and the rules and regulations thereunder.
"Investment Company" has the meaning assigned under the Investment
Company Act.
"Investment Company Act" means the Investment Company Act of 1940, as
amended, and the rules and regulations thereunder.
"Liens" means any charge, mortgage, pledge, security interest,
restriction, claim, lien, or encumbrance.
"Litigation" has the meaning assigned in Section 4.15.
"Material" means, with respect to any fact, circumstance, event or
thing, that such fact, circumstance, event or thing is material to (1) the
financial position, results of operations, assets, properties or business of (a)
FNBI and its Subsidiaries, taken as a whole or (b) Trust Company, or (2) the
ability of any of FNBI, the Bank or Trust Company timely to perform its
obligations under this Agreement or otherwise to consummate the transactions
contemplated by this Agreement, other than any fact, circumstance, event or
thing (i) generally affecting the banking industry, or resulting from general
economic or market conditions (including changes in interest rates), changes in
accounting principles or changes in laws, regulations or regulatory policies of
general applicability (or interpretations thereof), or (ii) resulting from
actions or omissions of a party hereto taken with the prior written consent of
the other party in contemplation of the transactions contemplated hereby.
"Merger" means the merger of Trust Company with and into the Bank, in
which the Bank shall be the surviving entity and the separate corporate
existence of the Trust Company shall cease.
"Multiemployer Plans" has the meaning assigned in Section 4.17(b).
"NASD" means the National Association of Securities Dealers, Inc.
"NBA" means the National Bank Act, and regulations promulgated
thereunder.
"OCC" means the Office of the Comptroller of the Currency.
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"Old Certificates" has the meaning assigned in Section 2.02(i).
"Outstanding Trust Company Shares" has the meaning assigned in Section
2.02(b).
"PBGC" means the Pension Benefit Guaranty Corporation.
"Pension Plan" has, with respect to any person, the meaning assigned in
Section 4.17(b).
"Person" means any individual, bank, corporation, partnership,
association, joint-stock company, business trust or unincorporated organization.
"Previously Acquired Shares" has the meaning assigned in Section 2.02
(d)(4).
"Previously Disclosed" means information set forth in the Disclosure
Schedule, whether in response to an express informational requirement or as an
exception to one or more representations or warranties or covenants, in each
case, that is contained in a correspondingly enumerated portion of such
Disclosure Schedule.
"Proxy Materials" has the meaning assigned in Section 6.02.
"Representatives" means, with respect to any Person, such Person's
directors, officers, employees, legal or financial advisors or any
representatives of such legal or financial advisors.
"Rights" means, with respect to any Person, securities or obligations
convertible into or exercisable or exchangeable for, or giving any Person any
right to subscribe for or acquire, or any options, calls or commitments relating
to, or any stock appreciation right or other instrument the value of which is
determined in whole or in part by reference to the market price or value of,
shares of capital stock of such Person.
"SEC" means the Securities and Exchange Commission.
"Scheduled Closing Date" has the meaning assigned in Section 2.03.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations thereunder.
"Securities Laws" means, collectively, the Securities Act, the Exchange
Act, the Investment Advisers Act, and any state securities and "blue sky" laws.
"Self-Regulatory Organization" means the NASD, the New York Stock
Exchange, the American Stock Exchange, the MSRB, the Midwest Stock Exchange, the
Boston Stock Exchange, Chicago Stock Exchange and the Philadelphia Stock
Exchange, or other commission, board, agency or body that is not a Governmental
Authority but is charged with the supervision or regulation of brokers, dealers,
securities underwriting or trading, stock exchanges, commodities
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exchanges, insurance companies or agents, investment companies or investment
advisers, or to the jurisdiction of which FNBI or one of its Subsidiaries is
otherwise subject.
"Shareholder Agreement" means an agreement in the form attached hereto
as Exhibit B pursuant to which all of the directors and officers of Trust
Company agree to vote their Trust Company Shares for the approval of the Merger
and the adoption of this Agreement.
"Special Record Date" has the meaning assigned in Section 2.02(i).
"Subsidiary" and "Significant Subsidiary" have the meanings ascribed to
them in Rule 1-02 of SEC Regulation S-X.
"Surviving Corporation" means the Bank at and after the Effective Time.
"Takeover Laws" means any laws existing under the Florida Banking Code
or the Florida Business Corporation Act designed to impede or make more
difficult the proposed Merger.
"Taxes" means all federal, state, local and foreign taxes, levies or
other assessments, however denominated, including, without limitation, all net
income, gross income, gross receipts, sales, use, ad valorem, goods and
services, capital, transfer, franchise, profits, license, withholding, payroll,
employment, employer health, excise, estimated, severance, stamp, occupation,
property or other taxes, and custom duties, together with any interest and any
penalties, additions to tax or additional amounts imposed by any taxing
authority.
"Tax Returns" means, collectively, all returns, declarations, reports,
estimates, information returns and statements required to be filed under
federal, state, local or any foreign tax laws.
"Termination Fee" has the meaning assigned in Section 8.01(e).
"Treasury Shares" means Trust Company Shares owned by Trust Company.
"Trust Company" means The Florida Trust Company, a nondepository trust
company organized under the laws of the State of Florida, and a party to this
Agreement.
"Trust Company Charter Documents" means the Articles of Incorporation
and Bylaws of Trust Company.
"Trust Company Board" means the Board of Directors of Trust Company.
"Trust Company Certificates" means the certificates that represented
issued and outstanding Trust Company Shares prior to the Effective Time.
"Trust Company Meeting" has the meaning assigned in Section 6.02.
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"Trust Company Shares" means the common shares, $65.00 par value, of
Trust Company, 50,000 of which are authorized by the Trust Company Charter
Documents, 27,000 of which are issued and outstanding as of the date hereof.
ARTICLE II
THE MERGER
2.01 The Merger. At the Effective Time, the business combination
contemplated by this Agreement shall occur and in furtherance thereof:
(a) Structure and Effects of the Merger. Trust Company
shall merge with and into the Bank under Section 215a of the NBA, and the
separate corporate existence of Trust Company shall thereupon cease. The Bank
shall be the Surviving Corporation in the Merger and shall continue to be
governed by the laws of the United States and, where applicable, the laws of the
State of Florida, with all its rights, privileges, immunities, powers and
franchises continuing unaffected by the Merger. At the Effective Time, the
separate corporate existence of Trust Company shall cease. The Merger shall have
the effects specified in the NBA and applicable Florida law. At the Effective
Time, the Bank, as the Surviving Corporation shall be liable for all liabilities
of both the Bank and the Trust Company, shall acquire all assets and rights of
Trust Company and shall be the successor to all fiduciary appointments and
duties of Trust Company.
(b) Articles of Association. The Articles of Association
of the Bank shall continue to be the Articles of Association of the Bank as the
Surviving Corporation.
(c) Bylaws. The Bylaws of the Surviving Corporation shall
be the Bylaws of the Bank as in effect immediately prior to the Effective Time,
until duly amended in accordance with the terms thereof and the NBA.
(d) Directors. The directors of the Bank as of the
Effective Time shall continue to be the directors of the Bank subsequent to the
Effective Time, provided that such directors shall hold such office until such
times as their successors shall be duly elected and qualified.
(e) Officers. The officers of the Bank as of the
Effective Time shall continue to be the officers of Bank subsequent to the
Effective Time, provided that the current officers of Trust Company noted on
Exhibit C shall be appointed to the offices of the Bank as noted on such Exhibit
C, all subject to the right of the Bank Board to remove such officers.
2.02 Manner of Converting and Exchanging Trust Company Shares.
Subject to the provisions of this Section 2.02, the manner of converting and
exchanging the Trust Company Shares at the Effective Time, shall be as follows:
(a) Each share of FNBI Common Stock outstanding
immediately prior to the Effective Time shall remain outstanding immediately
after the Effective Time.
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(b) Subject to the remaining provisions of this Section
2.02, each share of the Trust Company's common stock, $65.00 par value per
share, outstanding immediately prior to the Effective Time, other than shares
held in the Trust Company's treasury which shall be cancelled without
consideration on the Effective Time and shares with respect to which statutory
dissenters' rights have been perfected, (the "Outstanding Trust Company
Shares"), shall automatically be converted at the Effective Time into the right
to receive the "Consideration Amount" (as defined below) in cash and/or whole
shares of FNBI's common stock, plus cash in lieu of fractional shares, if
applicable. Subject to the remaining provisions of this Section 2.02, each Trust
Company shareholder who does not dissent may elect to receive a specified amount
of cash up to an amount equal to the Consideration Amount times the number of
Outstanding Trust Company Shares such shareholder holds. As used in this
Agreement, and specifically this Section 2.02, the term "Consideration Amount"
shall be an amount equal to the "book value" (as defined below) of a Trust
Company share divided by the book value of a share of FNBI Common Stock, times
ninety-two percent (0.92), times the "FNBI Stock Price" as defined in Section
2.02(g) below. "Book value" as used in this Section 2.02 shall mean the book
value of a share of common stock of the respective entity, FNBI or Trust
Company, determined in accordance with GAAP as of the last day of the month
immediately preceding the Effective Time.
(c) FNBI and Trust Company shall cause an election form
(the "Election Form") to be mailed to each record holder of the Outstanding
Trust Company Share as of a special record date fixed for such purpose by the
Trust Company's Board of Directors (the "Special Record Date"). FNBI and Trust
Company shall also establish a deadline for receipt of such Election Forms (the
"Election Deadline"), which shall be no less than 10 days prior to the
anticipated Effective Time. The Election Forms shall be mailed to each record
holder of the Outstanding Trust Company Shares as of the Special Record Date at
the same time as Proxy Materials relating to the Merger are mailed to such
record holders, but in no event less than 30 days prior to the Election
Deadline. The Election Form will permit each holder of record of Outstanding
Trust Company Shares as of the Special Record Date to elect, subject to Section
2.02(d), to have a certain number of such holder's Outstanding Trust Company
Shares converted into cash (a "Cash Election") if the Merger is consummated.
(d) It is the intent of the parties to this Agreement
that the Consideration Amount payable in cash not be less than 40% nor more than
45% and that the Consideration Amount payable in FNBI Common Stock not be less
than 55% nor more than 60%. Therefore, a Cash Election described in Section
2.02(c) above is subject to, and the determination of which Outstanding Trust
Company Shares will be converted into cash or FNBI Common Stock in the Merger
shall be determined as follows:
(1) If the total number of shares covered by Cash Elections is
less than or equal to forty-five percent (45%) and greater
than or equal to forty percent (40%) of the Outstanding Trust
Company Shares, all shares covered by Cash Elections shall be
converted into the right to receive cash and, all remaining
Outstanding Trust Company Shares (the "Non-elected Shares")
shall be converted into the right to receive shares of FNBI
Common Stock, plus cash in lieu of fractional shares.
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(2) If the total number of shares covered by Cash Elections is
less than forty percent (40%) of the Outstanding Trust Company
Shares, then all shares covered by Cash Elections will be paid
in cash and each of the Non-elected Shares shall have
allocated to it, on a prorata basis and in lieu of a
comparable portion of the Consideration Amount in FNBI Common
Stock, a portion of the Consideration Amount in cash equal to
the difference between 40% (the minimum number of the
Outstanding Trust Company Shares required to elect cash) and
the percentage of Outstanding Trust Company Shares choosing a
Cash Election.
(3) If the total number of shares covered by Cash Elections
exceeds 45% of the Outstanding Trust Company Shares, then each
of the Non-elected Shares shall be paid in FNBI Common Shares
and each of the shares covered by a Cash Election shall have
allocated to it, on a prorata basis and in lieu of a
comparable portion of the Consideration Amount in cash, a
portion of the Consideration Amount in FNBI Common Stock equal
to the difference between 55% ( the minimum number of the
Outstanding Trust Company Shares required to elect FNBI Common
Stock) and the percentage of Non-elected Shares.
(4) Solely for purposes of determining the total number of shares
covered by Cash Elections under this Section 2.02(d), all
shares of the Trust Company Common Stock as to which
dissenters' rights have been properly perfected under
Section 658.44 of the Florida Banking Code and all shares of
the Trust Company Common Stock acquired by FNBI prior to the
Effective Time from sources other than the Trust Company for
consideration other than FNBI Common Stock, if any,
(collectively, "Previously Acquired Shares"), shall be treated
as shares covered by Cash Elections, and all Previously
Acquired Shares shall be included in "Outstanding Trust
Company Shares."
(e) No fractional shares of FNBI Common Stock shall be
issued. Instead, each holder of Outstanding Trust Company Shares having a
fractional interest arising upon the conversion or exchange of such shares
shall, at the time of surrender of its certificate or certificates therefor, be
paid an amount in cash equal to the FNBI Stock Price times the fraction of a
share of FNBI Common Stock to which such holder would otherwise be entitled.
(f) Each share of the Trust Company's Common Stock that
is not an Outstanding Trust Company Share as of the Effective Time shall be
cancelled without consideration therefor.
(g) As used in this Section 2.02, the "FNBI Stock Price"
shall mean the average of the closing prices accurately reported on the NASDAQ
Small Cap Market for FNBI Common Stock, during the twenty consecutive trading
days ending on the fifth business day prior to the Effective Time; provided,
however, that if the average of such closing prices is less than $19.00 per
share, the FNBI Stock Price shall be $19.00, and if the average of such closing
prices is greater than $23.00 per share, the FNBI Stock Price shall be $23.00.
If no such closing price
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shall be reported on any day within such twenty-day period, the closing price
last reported prior to such date shall be used for such date.
(h) Outstanding Trust Company Shares held by Trust
Company shareholders who, prior to the Effective Time, have met the requirements
of Section 658.44 of the Florida Banking Code with respect to shareholders
dissenting from the Merger ("Dissenting Trust Company Shareholders") shall not
be converted in the Merger, but all such shares shall be cancelled and the
holders thereof shall thereafter have only such rights as are granted to
dissenting shareholders under the Florida Banking Code; provided, however, that
if any such shareholder fails to perfect his rights as a dissenting shareholder
with respect to his Outstanding Trust Company Shares in accordance with the
Florida Banking Code, such shares held by such shareholder shall, upon the
happening of that event, be treated the same as all other holders of the Trust
Company's Common Stock who have not dissented to the Merger.
(i) In addition to the Election Form, the Trust Company
shall also send or cause to be sent to each holder of Outstanding Trust Company
Shares as of the record date fixed for the special shareholder's meeting at
which the Merger will be submitted to a vote of the Trust Company's shareholders
(the "Special Record Date"), transmittal materials for use in exchanging
certificates that as of the Effective Time represented Outstanding Trust Company
Shares ("Old Certificates") for cash and certificates representing FNBI Common
Stock which shall be deposited with the Bank, the trust department of which
shall act as the exchange agent for the transaction (the "Exchange Agent"), by
FNBI as of the Effective Time. The letter of transmittal shall be mailed within
five (5) business days following the date of the special shareholders' meeting
at which the Merger will be submitted to a vote of the Trust Company's
shareholders. The letter of transmittal will contain instructions with respect
to the surrender of Old Certificates and the distribution of cash and
certificates representing FNBI Common Stock. If any certificates for shares of
FNBI Common Stock are to be issued in a name other than that for which an Old
Certificate surrendered or exchanged is issued, the Old Certificate so
surrendered shall be properly endorsed and otherwise in proper form for transfer
and the person requesting such exchange shall affix any requisite stock transfer
tax stamps to the Old Certificate surrendered or provide funds for their
purchase or establish to the satisfaction of the Exchange Agent that such taxes
are not payable. Unless and until Old Certificates (or evidence that such
certificates have been lost, stolen or destroyed accompanied by such security or
indemnity as shall be requested by the Trust Company and FNBI) are presented to
the Exchange Agent, the holder thereof shall not be entitled to the
consideration to be paid in exchange therefor pursuant to the Merger, to any
dividends payable on any FNBI Common Stock to which he is entitled, or to
exercise any rights as a shareholder of FNBI Common Stock. Subject to applicable
law and to the extent that the same has not yet been paid to a public official
pursuant to applicable abandoned property laws, upon surrender of his Old
Certificates, the holder thereof shall be paid the consideration to which he is
entitled hereunder, including any dividends which theretofore became payable on
any shares of FNBI Common Stock to which he is entitled. All such property, if
held by the Exchange Agent for payment or delivery to the holders of
unsurrendered Old Certificates and unclaimed at the end of one year from the
Effective Time, shall at such time be paid or redelivered by the Exchange Agent
to FNBI, and after such time any holder of an Old Certificate who has not
surrendered such certificate shall, subject to applicable laws and to the extent
that the same has not yet been paid to
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a public official pursuant to applicable abandoned property laws, look as a
general creditor only to FNBI for payment or delivery of such property. In no
event will any holder of Trust Company Common Stock exchanged in the Merger be
entitled to receive any interest on any amounts held by the Exchange Agent or
FNBI.
(j) After the Effective Time, there shall be no transfers
on the stock transfer books of the Trust Company or the Surviving Corporation of
any shares of the Trust Company's Common Stock. If, after the Effective Time,
Old Certificates are properly presented to the Surviving Corporation, they shall
be cancelled and exchanged for the consideration specified in this Section 2.02.
2.03 Effective Time. The Merger shall become effective upon such
date as determined by the OCC and the FDIC upon the request of FNBI, the Bank
and Trust Company. Subject to the terms of this Agreement, the parties shall
cause the Merger to become effective:
(a) on the date that is the fifteenth business day (the
"Scheduled Closing Date") to occur after the last of the conditions set forth in
Article VII (other than conditions relating solely to the delivery of documents
dated the Effective Date) shall have been satisfied or waived in accordance with
the terms of this Agreement, or
(b) on such other date as the parties may agree in
writing.
ARTICLE III
ACTIONS PENDING THE EFFECTIVE TIME
3.01 Forbearances of Trust Company. From the date hereof until the
Effective Time, except as expressly contemplated by this Agreement, without the
prior written consent of FNBI (which consent shall not be unreasonably
withheld), Trust Company will not:
(a) Ordinary Course. (1) Conduct the business of Trust
Company other than in the ordinary and usual course; (2) fail to use reasonable
best efforts to preserve intact any of its business organization and assets and
maintain its rights, franchises and existing relations with clients, customers,
suppliers, employees and business associates; or (3) engage in any new lines of
business.
(b) Capital Stock. Issue, sell or otherwise permit to
become outstanding, or authorize the creation of, any additional shares of stock
or any Rights, or enter into any contract, option or warrant with respect to the
foregoing.
(c) Dividends. (1) Make, declare, pay or set aside for
payment any dividend on or in respect of, or declare or make any distribution
on, any Trust Company Shares, other than dividends paid in accordance with past
practice to Trust Company shareholders for the payment of taxes due by such
Trust Company shareholders as a result of Trust Company being an S-Corporation,
or (2) directly or indirectly adjust, split, combine, redeem, reclassify,
purchase or
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otherwise acquire, any shares of its capital stock; provided, however, that any
outstanding Rights shall be either converted to Trust Company Shares prior to,
or terminated if not exercised at, the Effective Time.
(d) Compensation; Employment Agreements. Enter into,
amend, modify or renew any Contract regarding employment, consulting, severance
or similar arrangements with any directors, officers, employees, or independent
contractors of Trust Company, or grant any salary, wage or other increase in
compensation or increase in any employee benefit (including incentive or bonus
payments); provided, however, that Trust Company may grant year-end bonuses to
employees of Trust Company consistent with past practice but shall not grant to
such employees any salary increases.
(e) Benefit Plans. Enter into, establish, adopt, amend or
modify any Compensation Plans for any directors, officers, employees or
independent contractors of Trust Company, including taking any action that
accelerates the vesting or exercisability of any compensation or benefits
payable thereunder.
(f) Dispositions. Sell, transfer, mortgage, lease,
encumber or otherwise dispose of or discontinue any material portion of its
assets, business or properties.
(g) Acquisitions. Merge or consolidate with, or acquire a
material portion of the assets of, any other Person.
(h) Governing Documents. Amend the Trust Company Charter
Documents.
(i) Accounting Methods. Implement or adopt any change in
accounting principles, practices or methods, other than as may be required by
GAAP.
(j) Contracts. Except in the ordinary course of business
consistent with past practice, enter into, renew or terminate any material
Contract or amend or modify in any material respect any of its existing material
Contracts.
(k) Claims. Settle any material claim, action or
proceeding.
(l) Adverse Actions. Knowingly take any action that is
intended or is reasonably likely to result in (A) any of Trust Company's
representations and warranties set forth in this Agreement being or becoming
untrue in any material respect at any time at or prior to the Effective Time,
(B) any of the conditions to the Merger set forth in Article VII not being
satisfied, or (C) a material breach of any provision of this Agreement; except,
in each case, as may be required by applicable law.
(m) Capital Expenditures. Authorize or make any capital
expenditures, other than (1) annual budgeted amounts Previously Disclosed, or
(2) in the ordinary and usual course of business consistent with past practice
in amounts not exceeding $25,000 in the aggregate.
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(n) Risk Management. Except as required by applicable law
or regulation, (1) implement or adopt any change in the risk management
policies, procedures or practices of Trust Company which individually or in the
aggregate with all such other changes, would be Material, or (2) fail to use
commercially reasonable means to avoid any material increase in the aggregate
exposure of Trust Company or its Clients, to risk from the general United States
securities markets.
(o) Tax Matters. Make or change any material tax
election, change any annual tax accounting period, adopt or change any method of
tax accounting, file any amended Tax Return, enter into any material closing
agreement, settle any material Tax claim or assessment, surrender or compromise
any right to claim a material Tax refund, consent to any extension or waiver of
the limitations period applicable to any material Tax claim or assessment or
take any action that could adversely affect the viability of the net operating
loss carryforwards of Trust Company, if any.
(p) Regulated Activities. Initiate any new business
activity that would be impermissible for a national bank with services limited
to trust or a nondepository trust company chartered under the laws of the State
of Florida.
(q) Commitments. Agree or commit to do anything that
would be precluded by clauses (a) through (p) without first obtaining FNBI's
consent.
3.02 Forbearances of FNBI and the Bank. From the date hereof until
the Effective Time, except as expressly contemplated by this Agreement, without
the prior written consent of Trust Company, neither FNBI nor the Bank will
knowingly take any action that is intended or is reasonably likely to result in
(A) any of their respective representations and warranties set forth in this
Agreement being or becoming untrue in any material respect at any time at or
prior to the Effective Time, (B) any of the conditions to the Merger set forth
in Article VII not being satisfied, or (C) a material breach of any provision of
this Agreement; except, in each case, as may be required by applicable law.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF TRUST COMPANY
4.01 Organization, Standing and Authority. Trust Company is a
nondepository trust company, duly organized, validly existing and in good
standing under the laws of the State of Florida. Trust Company has the corporate
power and authority to carry on its business as it is now being conducted and to
own or lease all of its properties and assets.
4.02 Corporate Authority and Action. Trust Company has the
requisite corporate power and authority, and has taken all corporate action
necessary (1) to authorize the execution and delivery of, and performance of its
obligations under, this Agreement and (2) subject only to receipt of the
requisite approval of this Agreement by the holders of a majority of the
outstanding Trust Company Shares, to consummate the transactions contemplated by
this Agreement. This
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Agreement is a valid and legally binding obligation of Trust Company,
enforceable in accordance with its terms (except as enforceability may be
limited by applicable bankruptcy, insolvency, reorganization and similar laws of
general applicability relating to or affecting creditors' rights or by general
equity principles).
4.03 Regulatory Filings; No Defaults. (a) No consents or approvals
of, or filings or registrations with, any Governmental Authority or with any
third party are required to be made or obtained by Trust Company in connection
with the execution, delivery or performance by Trust Company of this Agreement,
or to consummate the Merger, except for the approval of the FDIC and OCC under
the Bank Merger Act and the Department.
(b) Subject only to the approval by the holders of a
majority of the outstanding Trust Company Shares, the receipt of the regulatory
approvals referred to in Section 4.03(a) and the expiration of applicable
waiting periods, if any, the execution, delivery and performance of this
Agreement and the consummation of the transactions contemplated hereby do not
and will not (1) constitute a breach or violation of, or a default under, or
give rise to any Lien, any acceleration of remedies or any right of termination
(with or without the giving of notice, passage of time or both) under, any law,
rule or regulation or any judgment, decree, order, governmental or
non-governmental permit or license, or Contract of Trust Company or to which
Trust Company or any of its properties is subject or bound, (2) constitute a
breach or violation of, or a default under, the Trust Company Charter Documents,
or (3) require any consent or approval under any such law, rule, regulation,
judgment, decree, order, governmental or non-governmental permit or license or
Contract.
4.04 Capital Stock. As of the date hereof, the capital stock of
Trust Company consists solely of 50,000 authorized shares of common stock,
$65.00 par value per share, 27,000 of which shares have been duly authorized and
are validly issued and outstanding, fully paid and nonassessable, and are
subject to no preemptive rights and were not issued in violation of any
subscriptive or preemptive rights. As of the date hereof, there are no Trust
Company Shares authorized and reserved for issuance, except as Previously
Disclosed, Trust Company does not have any Rights issued or outstanding with
respect to Trust Company Shares, and Trust Company does not have any commitment
to authorize, issue or sell any Trust Company Shares or Rights. Trust Company
has not issued any securities, taken any action, or failed to take any action
that could give rise to any claim for a violation of any federal or state
securities laws. No equity securities of Trust Company are or may become
required to be issued by reason of any Rights with respect thereto.
4.05 Subsidiaries. Trust Company has no subsidiaries and is not a
subsidiary of any other Person.
4.06 Financial Statements.
(a) Each of Trust Company's statements of financial
condition, including the related notes and schedules, fairly present, in all
Material respects the financial condition of Trust Company as of the date of
such statement of financial condition, and each of the statements of
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income, cash flows and changes in shareholders' equity, including any related
notes and schedules, fairly presented, in all Material respects the results of
operations, cash flows and shareholders' equity, as the case may be, of Trust
Company for the periods set forth therein (subject, in the case of unaudited
statements, to normal year-end audit adjustments), in each case in accordance
with generally accepted accounting principles consistently applied during the
periods involved (except as may be noted therein and except that such unaudited
statements include no notes).
(b) There are no Material liabilities of Trust Company of
any kind whatsoever, whether accrued, contingent, absolute, determined,
determinable or otherwise, and there is no existing condition, situation or set
of circumstances known to Trust Company which could reasonably be expected to
result in such a liability that is not included in the Financial Statements.
4.07 Absence of Certain Changes. Except as Previously Disclosed,
since December 31, 2002, the business of Trust Company has been conducted in the
ordinary and usual course, consistent with past practice, and there has not
been:
(a) any event, occurrence, development or state of
circumstances or facts which has had or could reasonably be expected to
constitute or result in a Material adverse change in the financial condition,
results of operations, business, assets, properties or shareholders' equity of
Trust Company, taken as a whole;
(b) any amendment of any term of any outstanding security
of Trust Company or to any of Trust Company's Charter Documents;
(c) any incurrence, assumption or guarantee by Trust
Company of any indebtedness for borrowed money, or assumption, guarantee,
endorsement or otherwise by Trust Company of any obligations of any other
Person, other than in the ordinary and usual course of business, consistent with
past practice, and in amounts and on terms consistent with past practices;
(d) any creation or assumption by Trust Company of any
Lien on any Material asset other than in the ordinary and usual course of
business consistent with past practices;
(e) the making of any loan, advance or capital
contributions to or investment in any person, other than in the ordinary and
usual course of business consistent with past practice;
(f) any change in any accounting policies or practices by
Trust Company; or
(g) any (1) Compensation Plans entered into, established
or amended, (2) grant of any severance or termination pay to any director,
officer, consultant, partner or employee of Trust Company, or (3) change in
compensation or other benefits payable to any director, officer, consultant or
employee of Trust Company, except in the ordinary course of business or as
required by Contract or applicable law with respect to employees of Trust
Company.
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4.08 Contracts. (a) Trust Company has Previously Disclosed each of
the following Contracts to which Trust Company is a party, or by which it is
bound or to which any of its properties is subject:
(1) any lease of real property;
(2) any agreement for the purchase of materials,
supplies, goods, services, equipment or other assets that provides for either
(A) annual payments of $10,000 or more or (B) aggregate payments of $25,000 or
more;
(3) any partnership, joint venture or other
similar agreement or arrangement, or any options or rights to acquire from any
person any capital stock, voting securities or securities convertible into or
exchangeable for capital stock or voting securities or such person, entered into
other than in the ordinary course of business;
(4) any executory agreement relating to the
acquisition or disposition of any business (whether by merger, sale of stock,
sale of assets or otherwise);
(5) any outstanding indenture, mortgage,
promissory note, loan agreement, guarantee or other agreement or commitment for
the borrowing of money by Trust Company or the deferred purchase price of
property (whether incurred, assumed, guaranteed or secured by any asset);
(6) any agreement that creates future payment
obligations in excess of $25,000 in the aggregate and which by its terms does
not terminate or is not terminable without penalty upon notice of 60 days or
less;
(7) any license, franchise or similar agreement
Material to Trust Company or any agreement relating to any trade name or
intellectual property right that is Material to Trust Company;
(8) any exclusive dealing agreement or any
agreement that materially limits the freedom of Trust Company to compete in any
line of business or with any person or in any area or that would so limit its
freedom after the Effective Date;
(9) any compensation, employment, severance,
supplemental retirement or other similar agreement or arrangement with any
employee or former employee of Trust Company; and
(10) any other Contract , if any, that would be a
"material contract" as defined in Item 601(b)(10) of SEC Regulation S-K.
(b) Each Contract that has been, or is required to be
Previously Disclosed pursuant to this Section, is a valid and binding agreement
of Trust Company, as applicable, and is
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in full force and effect, and Trust Company which is a party thereto is not in
default or breach in any material respect under the terms of any such Contract.
4.09 Contracts With Clients. (a) Trust Company is in Material
compliance with the terms of each Contract with any Client, and each such
Contract is in full force and effect with respect to the applicable Client.
Except as Previously Disclosed, there are no disputes pending or threatened with
any Client under the terms of any such Contract or with any former Client. Trust
Company has made available to representatives of FNBI and the Bank true and
complete copies of trust, agency, custodial and similar agreements with its
Clients.
(b) Trust Company has not made any extension of credit to
any Client.
4.10 Registrations and Licenses. Trust Company has Previously
Disclosed each Government Authority with which it is licensed or registered, or
is required to be licensed or registered, or by which it is subject to
regulation or examination. Except as Previously Disclosed, Trust Company is not
subject to regulation under the Investment Advisers Act or the Investment
Company Act of 1940. All federal and state registration requirements have been
complied with in all Material respects and such registrations, as currently
filed, and all periodic reports required to be filed with respect thereto,
including but not limited to reports of Trust Company filed with the Department,
are accurate and complete in all Material respects.
4.11 Compliance With Laws. Trust Company, and, to the best
knowledge of Trust Company, each of its officers and employees:
(a) is in Material compliance with all applicable
federal, state and local statutes, laws, regulations, ordinances, rules,
judgments, orders or decrees applicable to the conduct of its businesses or to
the employees conducting such businesses;
(b) has all permits, licenses, authorizations, orders and
approvals of, and has made all filings, applications and registrations with, all
Governmental Authorities that are required in order to permit Trust Company to
own or lease its properties and to conduct its businesses as presently
conducted, the absence of which would have a Material adverse effect; all such
permits, licenses, certificates of authority, orders and approvals are in full
force and effect and are current and, to the best of Trust Company's knowledge,
no suspension or cancellation of any of them is threatened or is reasonably
likely and are in good standing with all relevant Governmental Authorities;
(c) has received, no notification or written
communication (or, to the knowledge of Trust Company, any other communication)
from any Governmental Authority (1) asserting Material non-compliance with any
of the statutes, regulations, rules or ordinances that such Governmental
Authority enforces, (2) threatening to revoke any governmental authorization
(nor, to Trust Company's knowledge, do any grounds for any of the foregoing
exist), (3) requiring any of them (including any of Trust Company's directors or
controlling persons) to enter into a cease and desist order, agreement, or
memorandum of understanding (or requiring the board of directors of Trust
Company to adopt any resolution or policy), or (4) restricting or disqualifying
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their activities (except for restrictions generally imposed by rule, regulation
or administrative policy on Florida State chartered banks or trust companies or
national banks generally);
(d) is not aware of any pending or threatened
investigation, review or disciplinary proceedings by any Governmental Authority
against Trust Company or any officer, director or employee thereof;
(e) in the conduct of its business with respect to
employee benefit plans subject to Title I of ERISA, has not (A) breached any
applicable fiduciary duty under Part 4 of Title I of ERISA which would subject
it to liability under Sections 405 or 409 of ERISA and (B) engaged in a
"prohibited transaction" within the meaning of Section 406 of ERISA or Section
4975(c) of the Code which would subject it to liability or Taxes under Sections
409 or 502(i) of ERISA or Section 4975(a) of the Code;
4.12 Regulatory Reports. Trust Company has timely filed all reports
and statements, together with any amendments required to be made with respect
thereto, that were required to be filed under any applicable law, regulation or
rule, with (A) any applicable Governmental Authority, including but not limited
to the Department (collectively, the "Trust Company Reports"). As of their
respective dates, the Trust Company Reports complied, in all Material respects,
with the applicable statutes, rules, regulations and orders enforced or
promulgated by the Governmental Authority with which they were filed.
4.13 Properties. Except as reserved against in Trust Company's
Financial Statements dated before the date hereof, Trust Company has good and
marketable title, free and clear of all Liens (other than Liens for current
taxes not yet delinquent) to all of the Material properties and assets, tangible
or intangible, reflected in such Financial Statements as being owned by Trust
Company as of the dates thereof. To the best of Trust Company's knowledge, all
leasehold improvements and all the Material fixtures, equipment, and other
property and assets held under leases or subleases by Trust Company are held
under valid leases or subleases enforceable in accordance with their respective
terms (except as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other laws affecting creditors' rights
generally and to general equity principles). Trust Company has Previously
Disclosed all property owned by it as of the date hereof. Trust Company does not
own any real property, except in trust on behalf of Clients of Trust Company.
Trust Company has Previously Disclosed, as of the date hereof, a list of all
real estate owned by it in its fiduciary capacity. Trust Company has good and
marketable title to all securities held by it (except securities held in any
fiduciary or agency capacity), free and clear of any Lien. Such securities are
valued on the books of Trust Company in accordance with GAAP.
4.14 Taxes. (a) All Tax Returns with respect to Trust Company that
are required to have been filed have been timely filed, or requests for
extensions have been timely filed and have not expired, and such Tax Returns
were true, complete and accurate in all Material respects;
(b) As of the date of this Agreement, Trust Company is a
qualifying S corporation within the meaning of Section 1361 et seq. of the Code
("S Corp"). Each of the
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shareholders of Trust Company has made valid elections to treat Trust Company as
an S Corp. As of the date of this Agreement, neither Trust Company nor Trust
Company's shareholders has committed any act or omission that has caused Trust
Company to lose its S Corp status. Between the execution of this Agreement and
the Closing Date Trust Company will preserve its status as an S Corp.;
(c) all Taxes shown to be due on such Tax Returns have
been paid in full or adequate reserves have been established in accordance with
GAAP for the payment of such Taxes;
(d) all Taxes due with respect to completed and settled
examinations have been paid in full or adequate reserves have been established
in accordance with GAAP for the payment of such Taxes;
(e) no issues have been raised by the relevant taxing
authority in connection with the examination of any such Tax Returns; and
(f) no currently effective waivers of statutes of
limitations have been given by or requested in writing (or to the best knowledge
of Trust Company, any other communication) with respect to any Taxes of Trust
Company.
4.15 Litigation. Except as Previously Disclosed, no litigation,
proceeding, investigation or controversy ("Litigation") before any court,
arbitrator, mediator or Governmental Authority is pending against Trust Company,
and, to the best of Trust Company's knowledge, after due inquiry, no such
Litigation has been threatened, nor does any valid basis exist for the
commencement of any such Litigation.
4.16 Employees; Labor Matters. (a) Trust Company is in Material
compliance with all currently applicable laws regarding employment and
employment practices, terms and conditions of employment and wages and hours,
and related matters. Trust Company is not engaged in any unfair labor practice
and there is no unfair labor practice complaint pending or threatened against
Trust Company.
(b) Trust Company is not a party to, nor is it bound by,
any collective bargaining agreement, Contract or other agreement or
understanding with any labor union or organization. There are no pending or, to
the best knowledge of Trust Company, threatened charges or complaints alleging
sexual or other harassment or other discrimination by Trust Company or any of
their employees, agents or representatives.
4.17 Employee Benefit Plans. (a) Trust Company has Previously
Disclosed a complete list of all bonus, deferred compensation, consulting,
pension, retirement, profit-sharing, thrift, savings, employee stock ownership,
stock bonus, stock purchase, restricted stock and stock option plans, all
employment or severance Contracts, all medical, dental, health and life
insurance plans, all other employee benefit plans, Contracts or arrangements
maintained or contributed to by it or Trust Company for the benefit of current
or former employees or directors or their
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beneficiaries (the "Compensation Plans"). True and complete copies of all
Compensation Plans, including, but not limited to, any trust instruments and/or
insurance Contracts, if any, forming a part thereof, and all amendments thereto
have been made available to representatives of FNBI and the Bank.
(b) All "employee benefit plans" within the meaning of
Section 3(3) of ERISA, other than "multiemployer plans" within the meaning of
Section 3(37) of ERISA ("Multiemployer Plans"), covering employees or former
employees of Trust Company (the "ERISA Plans"), to the extent subject to ERISA,
are in substantial compliance with ERISA. Each ERISA Plan which is an "employee
pension benefit plan" within the meaning of Section 3(2) of ERISA ("Pension
Plan") and which is intended to be qualified, under Section 401(a) of the Code,
has received a favorable determination letter from the IRS with respect to "TRA"
(as defined in Section 1 of IRS Revenue Procedure 93-39), and Trust Company is
not aware of any circumstances reasonably likely to result in the revocation or
denial of any such favorable determination letter. There is no pending or, to
the knowledge of Trust Company, threatened litigation relating to the ERISA
Plans. Trust Company has not engaged in a transaction with respect to any ERISA
Plan that would subject Trust Company to a tax or penalty imposed by either
Section 4975 of the Code or Section 502(i) of ERISA in an amount which would be
Material.
(c) No liability under Subtitle C or D of Title IV of
ERISA has been or is reasonably expected to be incurred by Trust Company with
respect to any ongoing, frozen or terminated "single-employer plan", within the
meaning of Section 4001 of ERISA, currently or formerly maintained by Trust
Company, or the single-employer plan of any entity which is considered one
employer with Trust Company under Section 4001 of ERISA or Section 414 of the
Code (an "ERISA Affiliate"). Trust Company has not contributed or been obligated
to contribute to a Multiemployer Plan at any time. No notice of a "reportable
event", within the meaning of Section 4043 of ERISA for which the 30-day
reporting requirement has not been waived, has been required to be filed for any
Pension Plan or by any ERISA Affiliate within the past 12-month period.
(d) All contributions required to be made under the terms
of any ERISA Plan have been timely made. Neither any Pension Plan nor any
single-employer plan of an ERISA Affiliate has an "accumulated funding
deficiency" (whether or not waived) within the meaning of Section 412 of the
Code or Section 302 of ERISA. Trust Company has not provided, nor is it required
to provide, security to any Pension Plan or to any single-employer plan of an
ERISA Affiliate pursuant to Section 401(a)(29) of the Code.
(e) Under each Pension Plan, as of the last day of the
most recent plan year, the actuarially determined present value of all "benefit
liabilities," within the meaning of Section 4001(a)(16) of ERISA (as determined
on the basis of the actuarial assumptions contained in the plan's most recent
actuarial valuation) did not exceed the then current value of the assets of such
plan, and there has been no adverse change in the financial condition of such
plan since the last day of the most recent plan year.
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(f) Trust Company has no obligations for retiree health
and life benefits under any plan, except for health continuation coverage as
required by Section 4980B of the Code or Part 6 of Title I of ERISA. There are
no restrictions on the rights of Trust Company to amend or terminate any such
plan without incurring any liability thereunder.
(g) Neither the execution and delivery of this Agreement
nor the consummation of the transactions contemplated hereby will (1) result in
any payment (including severance, unemployment compensation, golden parachute or
otherwise) becoming due to any director or any employee of Trust Company under
any Compensation Plan or otherwise from Trust Company, (2) increase any benefits
otherwise payable under any Compensation Plan, or (3) result in any acceleration
of the time of payment or vesting of any such benefit.
4.18 Environmental Matters. (a) To the best knowledge of Trust
Company, Trust Company has complied at all times with applicable Environmental
Laws. To the best knowledge of Trust Company, no property (including buildings
and any other structures) currently or formerly owned or operated (or which
Trust Company would be deemed to have owned or operated under any Environmental
Law, including by Trust Company in its fiduciary capacity) by Trust Company or
in which Trust Company (whether as fiduciary or otherwise) has a Lien, has been
contaminated with, or has had any release of, any Hazardous Substance in such
form or substance so as to create any liability for Trust Company. To the best
knowledge of Trust Company, Trust Company is not subject to liability for any
Hazardous Substance disposal or contamination on any other third-party property.
Trust Company is not aware of any reasonably likely liability relating to
environmental circumstances or conditions (including the presence of asbestos,
underground storage tanks, lead products or polychlorinated biphenyls) involving
Trust Company, any currently or formerly owned or operated property (whether as
fiduciary or otherwise), or any reasonably likely liability related to any Lien
held by Trust Company.
(b) Within the last six years, Trust Company has not
received any notice, demand letter, claim or request for information alleging
any violation of, or liability of Trust Company under, any Environmental Law.
Trust Company is not subject to any order, decree, injunction or other agreement
with any Governmental Authority or any third party relating to any Environmental
Law.
(c) Trust Company has made available to FNBI copies of
all environmental reports, studies, sampling data, correspondence, filings and
other environmental information in its possession or reasonably available to it
relating to Trust Company or any currently or formerly owned or operated
property or any property in which Trust Company (whether as fiduciary or
otherwise) has held a Lien.
4.19 Internal Controls. Trust Company has devised and maintained
systems of internal accounting controls sufficient to provide reasonable
assurances that (a) transactions are executed in accordance with management's
general or specific authorizations, (b) transactions are recorded as necessary
to permit preparation of financial statements in conformity with GAAP and to
maintain accountability for assets, (c) access to assets is permitted only in
accordance with management's general or specific authorization, and (d) the
recorded accountability for assets is
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compared with the existing assets at reasonable intervals and appropriate action
is taken with respect to any differences.
4.20 Names and Trademarks. Trust Company has the right to use the
names, service-marks, trademarks and other intellectual property currently used
by it in the conduct of its businesses, free and clear of any Liens. To the best
knowledge of Trust Company, no other Person has the right to use such names,
service-marks or trademarks in any such state. Each of such names,
service-marks, trademarks and other intellectual property has been Previously
Disclosed. Further, Trust Company has not been informed that it is operating in
violation of any software license agreement and, to the best knowledge of the
Trust Company, no reasonable basis exists for any such claim.
4.21 Insurance. Trust Company has Previously Disclosed all of the
insurance policies, binders, or bonds maintained by Trust Company ("Insurance
Policies"). Trust Company is insured with reputable insurers against such risks
and in such amounts as is prudent in accordance with industry practices. All of
the Insurance Policies are in full force and effect, Trust Company is not in
Material default thereunder, there are no claims pending thereunder, and, to the
best knowledge of Trust Company, no facts exist which would properly give rise
to such a claim. Trust Company has not received any notice of cancellation or
nonrenewal of any insurance policy currently in place.
4.22 No Brokers. No action has been taken by Trust Company that
would give rise to any valid claim against any party hereto for a brokerage
commission, finder's fee or other like payment with respect to the transactions
contemplated by this Agreement.
4.23 Books and Records. Trust Company has made available to FNBI
and the Bank true and accurate copies of the Trust Company Charter Documents and
has granted or will grant to FNBI and the Bank access to records of all meetings
and other corporate actions occurring before the Effective Time by the Trust
Company Shareholders, the Trust Company Board of Directors, Trust Administration
Committee and Trust Investment Committee. The minute books of Trust Company
contain, in all Material respects, complete and accurate records of all meetings
and other corporate actions of its shareholders, board of directors and
committees of the boards of directors.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF FNBI AND THE BANK
5.01 Organization, Standing and Authority. FNBI is a corporation
duly organized, validly existing and in good standing under the laws of the
State of Florida, and is duly qualified to do business and is in good standing
in all jurisdictions where its ownership or leasing of property or assets or the
conduct of its business requires it to be so qualified. FNBI is a registered
bank holding company under the Bank Holding Company Act of 1956. The Bank is a
national banking association organized under the laws of the United States and
it is duly authorized to do business as such.
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5.02 Corporate Power. FNBI and the Bank each has the corporate
power and authority to carry on its respective businesses as it is now being
conducted and to own all its respective properties and assets.
5.03 Corporate Authority. FNBI and the Bank each has the requisite
corporate power and authority, and has taken all corporate action necessary to
authorize the execution and delivery of, and performance of its respective
obligations under, this Agreement and to consummate the transactions
contemplated by this Agreement. This Agreement is a valid and legally binding
agreement of FNBI and the Bank, enforceable in accordance with its terms (except
as enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium, fraudulent transfer and similar laws of general
applicability relating to or affecting creditors' rights or by general equity
principles).
5.04 Regulatory Approvals; No Defaults. (a) No consents or
approvals of, or filings or registrations with, any Governmental Authority,
Self-Regulatory Organization or with any third party are required to be made or
obtained by FNBI or the Bank in connection with the execution, delivery or
performance by FNBI or the Bank of this Agreement, or to consummate the Merger,
except for filings of applications or notices of the Merger with the OCC, FDIC,
Federal Reserve, Department, SEC and NASD. As of the date hereof, neither FNBI
nor the Bank is aware of any reason why the approvals of all Governmental
Authorities necessary to permit consummation of the transactions contemplated
hereby will not be received without the imposition of a condition or requirement
described in Section 7.01(b).
(b) Subject only to receipt of the regulatory approvals
referred to in Section 5.04(a) and the expiration of applicable waiting periods,
if any, the execution, delivery and performance of this Agreement and the
consummation of the transactions contemplated hereby do not and will not (1)
constitute a breach or violation of, or a default under, or give rise to any
Lien, any acceleration of remedies or any right of termination under, any law,
rule or regulation or any judgment, decree, order, governmental permit or
license, or Contract of FNBI or the Bank or to which FNBI or the Bank or their
respective properties are subject or bound, (2) constitute a breach or violation
of, or a default under, the Articles of Incorporation or Bylaws of FNBI or the
Articles of Association or Bylaws of the Bank, or (3) require any consent or
approval under any such law, rule, regulation, judgment, decree, order,
governmental permit or license or Contract.
5.05 Financial Statements. Each of FNBI's statements of financial
condition, including the related notes and schedules, fairly present the
consolidated financial condition of FNBI, the Bank and other FNBI subsidiaries
as of the date of such statement of financial condition, and each of the
statements of income, cash flows and changes in shareholders' equity, including
any related notes and schedules, fairly presented the consolidated results of
operations, cash flows and shareholders' equity, as the case may be, of FNBI,
the Bank and other subsidiaries for the periods set forth therein (subject, in
the case of unaudited statements, to normal year-end audit adjustments), in each
case in accordance with generally accepted accounting principles consistently
applied during the periods involved (except as may be noted therein and except
that such unaudited statements include no notes).
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5.06 Stock Issuable in the Merger. The shares of FNBI Common Stock
to be issued to shareholders of Trust Company pursuant to this Agreement have
been duly authorized and, when issued in accordance with the terms of this
Agreement, will be validly issued, fully paid and nonassessable. However,
because the shares of FNBI Common Stock to be issued in connection with the
Merger will be issued in a transaction that is exempt from the registration
requirements of Section 5 of the Securities Act, under Section 3(b) and/or 4(2)
of the Securities Act and Regulation D promulgated thereunder, the FNBI Common
Stock acquired by Trust Company shareholders in the Merger will be bear
restrictions upon transfer. Such restrictions will limit the ability of such
holders to resell such FNBI Common Shares for a period of at least one year.
5.07 Absence of Certain Changes. Since December 31, 2002, there has
not been any event, occurrence, development or state of circumstances or facts
which has had or could reasonably be expected to constitute or result in a
Material adverse change in the financial condition, results of operations,
business, assets, properties or shareholders' equity of FNBI and its
Subsidiaries, taken as a whole.
5.08 Capital Stock. As of the date hereof, the capital stock of
FNBI consists solely of 2,500,000 authorized shares of common stock, $0.10 par
value per share, 1,990,731 of which shares have been duly authorized and are
validly issued and outstanding, fully paid and nonassessable, and are subject to
no preemptive rights and were not issued in violation of any subscription or
preemptive rights.
5.09 SEC Reports. Since January 1, 2001, FNBI has filed all
Material reports and statements, together with any amendments required to be
made with respect thereto, that it was required to file with the SEC, including,
but not limited to, Forms 10-K, Forms 10-Q, Forms 8-K, and proxy statements, and
any applicable state securities or banking authorities. As of their respective
dates, each 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 did
not contain any untrue 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.
5.10 Compliance with Laws. FNBI and the Bank, and, to the best
knowledge of FNBI and the Bank, each of its officers and employees:
(a) is in Material compliance with all applicable
federal, state and local statutes, laws, regulations, ordinances, rules,
judgments, orders or decrees applicable to the conduct of its businesses or to
the employees conducting such businesses;
(b) has all permits, licenses, authorizations, orders and
approvals of, and has made all filings, applications and registrations with, all
Governmental Authorities that are required in order to permit FNBI and the Bank
to own or lease their respective properties and to conduct their respective
businesses as presently conducted, the absence of which would have a Material
adverse effect; all such permits, licenses, certificates of authority, orders
and approvals are in full
-24-
force and effect and are current and, to the best knowledge of FNBI and the
Bank, no suspension or cancellation of any of them is threatened or is
reasonably likely and are in good standing with all relevant Governmental
Authorities;
(c) has received, no notification or written
communication (or, to the knowledge of FNBI or the Bank, any other
communication) from any Governmental Authority (1) asserting Material
non-compliance with any of the statutes, regulations, rules or ordinances that
such Governmental Authority enforces, (2) threatening to revoke any governmental
authorization (nor, to the knowledge of FNBI or the Bank, do any grounds for any
of the foregoing exist), (3) requiring any of them (including any of FNBI's or
the Bank's directors or controlling persons) to enter into a cease and desist
order, agreement, or memorandum of understanding (or requiring the board of
directors of FNBI or the Bank to adopt any resolution or policy), or (4)
restricting or disqualifying their activities (except for restrictions generally
imposed by rule, regulation or administrative policy on bank holding companies
or national banks generally);
(d) is not aware of any pending or threatened
investigation, review or disciplinary proceedings by any Governmental Authority
against FNBI or the Bank or any officer, director or employee thereof;
5.11 Material Contracts. FNBI has filed as an exhibit to its annual
report on Form 10-K each Contract to be so filed under the Securities Laws, and
the rules and regulations promulgated thereunder.
5.12 Regulatory Reports. FNBI and the Bank have timely filed all
reports and statements, together with any amendments required to be made with
respect thereto, that were required to be filed under any applicable law,
regulation or rule, with (A) any applicable Governmental Authority, including
but not limited to the OCC (collectively, the "FNBI Reports"). As of their
respective dates, the FNBI Reports complied, in all Material respects, with the
applicable statutes, rules, regulations and orders enforced or promulgated by
the Governmental Authority with which they were filed.
ARTICLE VI
COVENANTS
6.01 Reasonable Best Efforts. (a) Subject to the terms and
conditions of this Agreement, each of Trust Company, FNBI and the Bank agrees to
use its reasonable best efforts in good faith to take, or cause to be taken
(including causing any of its Subsidiaries to take), all actions, and to do, or
cause to be done, all things necessary, proper or desirable, or advisable under
applicable laws, to permit consummation of the Merger as promptly as reasonably
practicable and otherwise to enable consummation of the transactions
contemplated hereby and shall cooperate fully with the other party hereto to
that end.
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(b) Without limiting the generality of Section 6.01(a),
Trust Company agrees to use its reasonable best efforts to obtain the consent or
approval of all Persons party to a Contract with Trust Company, to the extent
such consent or approval is required in order to consummate the Merger or for
FNBI and the Bank to receive the benefits thereof.
6.02 Shareholder Approvals. The Trust Company agrees to take, in
accordance with applicable law, the Trust Company Articles and the Trust Company
Bylaws, all action necessary to convene, and shall hold a meeting of the
shareholders of Trust Company (the "Trust Company Meeting") to consider and vote
upon the approval and adoption of this Agreement and any other matters required
to be approved by the Trust Company's shareholders for consummation of the
Merger as promptly as practicable after execution of this Agreement. The Trust
Company Board shall recommend such approval, and the Trust Company shall take
all reasonable, lawful action to solicit such approval by its shareholders. FNBI
and its counsel shall be responsible for the preparation of the proxy
statement/private placement memorandum, notice, and additional documents
necessary to obtain the approval of the Trust Company shareholders of the Merger
(the "Proxy Materials") in connection with the Trust Company Meeting. The Trust
Company agrees that it shall assist FNBI and its counsel by providing all
information necessary about the Trust Company to prepare the Proxy Materials.
6.03 Access; Information. (a) Trust Company agrees that upon
reasonable notice and subject to applicable laws relating to the exchange of
information, it shall afford to FNBI and the Bank and their respective officers,
employees, counsel, accountants and other authorized representatives, such
access during normal business hours and at such other times as are reasonably
necessary throughout the period prior to the Effective Time to the books,
records (including Tax Returns and work papers of independent auditors),
properties, personnel and to such other information as FNBI and the Bank may
reasonably request and, during such period, it shall furnish promptly to FNBI
and the Bank upon request (1) a copy of each material report, schedule and other
document filed by it pursuant to the requirements of federal or state securities
or banking laws, unless disclosure of such information is forbidden by
applicable law or regulation, and, (2) all other information concerning the
business, properties and personnel of Trust Company as FNBI and the Bank may
reasonably request.
(b) FNBI and the Bank agree that they will not, and will
cause their respective representatives not to, use any information obtained
pursuant to this Section 6.03 for any purpose unrelated to the consummation of
the transactions contemplated by this Agreement. Subject to the requirements of
law, FNBI and the Bank will keep confidential, and will cause its
representatives to keep confidential, all information and documents obtained
pursuant to this Section 6.03 unless such information (1) was already known to
FNBI or the Bank, (2) becomes available to FNBI or the Bank from other sources
not known by FNBI or the Bank to be bound by a confidentiality obligation, (3)
is disclosed with the prior written approval Trust Company, or (4) is or becomes
readily ascertainable from published information or trade sources. In the event
that this Agreement is terminated or the transactions contemplated by this
Agreement shall otherwise fail to be consummated, FNBI and the Bank shall
promptly upon request cause all copies of documents or extracts thereof
containing information and data as to Trust Company to be returned to Trust
Company. No investigation by FNBI and the Bank of the business and
-26-
affairs of Trust Company shall affect or be deemed to modify or waive any
representation, warranty, covenant or agreement in this Agreement, or the
conditions to any party's obligation to consummate the transactions contemplated
by this Agreement.
6.04 Acquisition Proposals. Trust Company agrees that neither it
nor its officers, directors, agents, advisors or affiliates will, solicit or
encourage inquiries or proposals with respect to, or engage in any negotiations
concerning, or provide any confidential information to, or have any discussions
with, any person relating to, any tender or exchange offer, proposal for a
merger, consolidation or other business combination involving Trust Company or
any proposal or offer to acquire in any manner a substantial equity interest in,
or a substantial portion of the assets or operations of, Trust Company, other
than the transactions contemplated by this Agreement (any of the foregoing, an
"Acquisition Proposal"); provided, that, if Trust Company is not otherwise in
violation of this Section 6.04, the Trust Company Board may provide information
to, and may engage in such negotiations or discussions with, a person, directly
or through representatives relating to an Acquisition Proposal and approve such
Acquisition Proposal to its shareholders, if (1) the Trust Company Board, after
having consulted with and considered the written advice of outside counsel to
the Trust Company Board, has determined in good faith that the provision of such
information or the engaging in such negotiations or discussions is required in
order to discharge properly the directors' fiduciary duties in accordance with
the FBC and (2) Trust Company has received from such person a confidentiality
agreement on substantially the same terms as entered into by FNBI or the Bank.
Trust Company also agrees immediately to cease and cause to be terminated any
activities, discussions or negotiations conducted prior to the date of this
Agreement with any parties other than FNBI and the Bank, with respect to any of
the foregoing. Trust Company shall promptly advise FNBI and the Bank on a
current basis following the receipt by it of any Acquisition Proposal and the
substance thereof (including the identity of the person making such Acquisition
Proposal), and advise FNBI and the Bank of any developments with respect to such
Acquisition Proposal promptly upon the occurrence thereof.
6.05 Takeover Laws. No party shall take any action that would cause
the transactions contemplated by this Agreement to be subject to requirements
imposed by any Takeover Law and all of them shall take all necessary steps
within their control to exempt (or ensure the continued exemption of) the
transactions contemplated by this Agreement from, or if necessary challenge the
validity or applicability of, any applicable Takeover Law, as now or hereafter
in effect.
6.06 Regulatory Applications. (a) FNBI, the Bank and Trust Company
shall cooperate and use their respective reasonable best efforts to prepare all
documentation, to effect all filings and to obtain all permits, consents,
approvals and authorizations of all third parties and Governmental Authorities
necessary to consummate the transactions contemplated by this Agreement as
promptly as reasonably practicable. Each of FNBI, the Bank and Trust Company
shall have the right to review in advance, and to the extent practicable each
will consult with the other, in each case subject to applicable laws relating to
the exchange of information, with respect to all material written information
submitted to any third party or any Governmental Authority in connection with
the transactions contemplated by this Agreement. In exercising the foregoing
right, each of FNBI, the Bank and Trust Company agrees to act reasonably and as
each party shall provide copies of all regulatory applications related to the
Merger and correspondence to and
-27-
from such agencies related to such applications promptly as practicable. Each of
FNBI, the Bank and Trust Company agrees that it will consult with the other
party hereto with respect to obtaining of all material permits, consents,
approvals and authorizations of all third parties and Governmental Authorities
necessary or advisable to consummate the transactions contemplated by this
Agreement, and all parties will keep the other parties apprised of the status of
material matters relating to the completion of the transactions contemplated
hereby.
(b) Each of FNBI, the Bank and Trust Company agrees, upon
request, to furnish the other party with all information concerning itself, its
Subsidiaries, directors, officers and shareholders and such other matters as
maybe reasonably necessary or advisable in connection with any filing, notice or
application made by or on behalf of such other party or any of its Subsidiaries
to any third party or Governmental Authority.
6.07 "Tail" Policy for Director and Officer Liability Insurance.
Trust Company shall purchase, at its own expense, a "tail" to the policy of
director and officer liability insurance that it currently has in place, such
tail to provide coverage for the directors and officers of Trust Company for not
less than three years' coverage. The cost of such policy shall be paid prior to
the calculation of "book value" of Trust Company shares under Section 2.02.
6.08 Notification of Certain Matters. (a) Each of Trust Company,
FNBI and the Bank shall give prompt notice to the others of any fact, event or
circumstance known to it that is reasonably likely, individually or taken
together with all other facts, events and circumstances known to it, to result
in a Material breach of any of its representations, warranties, covenants or
agreements contained herein.
(b) Trust Company shall promptly notify FNBI and the
Bank, and FNBI and the Bank shall promptly notify Trust Company, of:
(1) any notice in writing from any Person
alleging that the consent of such Person is or may be required as a condition to
the Merger;
(2) any notice or other written communications
from any Client of Trust Company (A) terminating or threatening to terminate any
Contract with Trust Company relating to the rendering of services to such
Client, or (B) relating to any Material dispute with such Client; or
(3) any notice or other communication from any
Governmental Authority or Self-Regulatory Organization in connection with the
transactions contemplated by this Agreement.
6.09 Press Releases. Each of Trust Company, FNBI and the Bank
agrees that it will not, without the prior approval of the other parties hereto,
issue any press release or written statement relating to the transactions
contemplated hereby, except as otherwise required by applicable law or
regulation or the rules of any applicable Governmental Authority or
Self-Regulatory Organization. The parties acknowledge that upon the signing of
this Agreement,
-28-
FNBI will be obligated to file a Form 8-K with the SEC and notify the NASD
regarding the Merger.
6.10 Certain Policies of Trust Company. Upon the request of FNBI
and the Bank, Trust Company shall, consistent with GAAP and regulatory
accounting principles, use its reasonable best efforts to record certain
accounting adjustments to the policies of Trust Company so as to reflect the
policies of FNBI and the Bank; provided, however, that Trust Company shall not
be obligated to record any such accounting adjustments pursuant to this Section
6.10 (a) unless and until Trust Company shall be satisfied that the conditions
to the obligation of the parties to consummate the Merger will be satisfied or
waived on or before the Effective Time and (b) in no event until the day prior
to the Effective Date. Trust Company's representations, warranties and covenants
contained in this Agreement shall not be deemed to be untrue or breached in any
respect for any purpose as a consequence of any modifications or changes
undertaken solely on account of this Section 6.10. Such adjustments shall not
affect the computation of "book value" of Trust Company shares under Section
2.02.
ARTICLE VII
CONDITIONS TO CONSUMMATION OF THE MERGER
7.01 Conditions to Each Party's Obligation to Effect the Merger.
The respective obligation of each of FNBI, the Bank and Trust Company to
consummate the Merger is subject to the fulfillment or written waiver by FNBI,
the Bank and Trust Company prior to the Effective Time of each of the following
conditions:
(a) Shareholder Approval. This Agreement shall have been
duly adopted by the requisite vote of the holders of outstanding Trust Company
Shares entitled to vote thereon in accordance with Section 658.44 of the FBC,
other applicable law and the Trust Company Articles and the Trust Company
Bylaws.
(b) Governmental and Regulatory Consents. All approvals
and authorizations of, filings and registrations with, and notifications to, all
Governmental Authorities and Self-Regulatory Organizations required for the
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;
provided, however, that none of the preceding shall be deemed obtained or made
if it shall be subject to any condition or restriction the effect of which would
have been such that FNBI or the Bank would not reasonably have entered into this
Agreement had such condition or restriction been known as of the date hereof.
(c) Third Party Consents. All consents or approvals of
all Persons, other than Governmental Authorities, required for or in connection
with the execution, delivery and performance of this Agreement and the
consummation of the Merger shall have been obtained and shall be in full force
and effect, unless the failure to obtain any such consent or approval is not
reasonably likely to have, individually or in the aggregate, a Material adverse
effect on the Surviving Corporation.
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(d) No Injunction. No Governmental Authority of competent
jurisdiction shall have enacted, issued, promulgated, enforced or entered any
statute, rule, regulation, judgment, decree, injunction or other order (whether
temporary, preliminary or permanent) which is in effect and prohibits
consummation of the transactions contemplated by this Agreement.
7.02 Conditions to Obligation of Trust Company. The obligation of
Trust Company to consummate the Merger is also subject to the fulfillment or
written waiver by Trust Company prior to the Effective Time of each of the
following conditions:
(a) Representations and Warranties. The representations
and warranties of FNBI and the Bank set forth in this Agreement shall be true
and correct as of the date of this Agreement and as of the Effective Date as
though made on and as of the Effective Date (except that representations and
warranties that by their terms speak as of the date of this Agreement or some
other date shall be true and correct only as of such date), and Trust Company
shall have received a certificate, dated the Effective Date, signed on behalf of
FNBI and the Bank by the Chairman or President of FNBI and the Bank to such
effect.
(b) Performance of Obligations of FNBI and the Bank. FNBI
and the Bank shall have performed in all material respects all obligations
required to be performed by them under this Agreement at or prior to the
Effective Time, and Trust Company shall have received a certificate, dated the
Effective Date, signed on behalf of FNBI and the Bank by the Chairman or
President of FNBI and the Bank to such effect.
(c) Merger Consideration. FNBI shall have deposited into
a separate segregated account with the Exchange Agent the cash portion of the
Merger Consideration and shall be ready, willing and able to issue the stock
certificates of FNBI representing the appropriate number of shares of FNBI
Common Stock comprising the stock portion of the Merger Consideration.
(d) Employment Agreements. ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇
and ▇▇▇▇▇ ▇▇▇▇▇▇ each shall have entered into an employment agreement in
substantially the form of the agreement set forth in Exhibit A.
7.03 Conditions to Obligation of FNBI and the Bank. The obligation
of FNBI and the Bank to consummate the Merger is also subject to the fulfillment
or written waiver by FNBI and the Bank prior to the Effective Time of each of
the following conditions:
(a) Representations and Warranties. The representations
and warranties of Trust Company set forth in this Agreement shall be true and
correct as of the date of this Agreement and as of the Effective Date as though
made on and as of the Effective Date (except that representations and warranties
that by their terms speak as of the date of this Agreement or some other date
shall be true and correct only as of such date) and FNBI and the Bank shall have
received a certificate, dated the Effective Date, signed on behalf of Trust
Company by the President of Trust Company to such effect.
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(b) Performance of Obligations of Trust Company. Trust
Company shall have performed in all Material respects all obligations required
to be performed by it under this Agreement at or prior to the Effective Time,
and FNBI and the Bank shall have received, prior to the Effective Time, a
certificate, dated the Effective Date, signed on behalf of Trust Company by the
President of Trust Company to such effect.
(c) Employment Agreements. ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇. ▇▇▇▇
and ▇▇▇▇▇ ▇▇▇▇▇▇ each shall have entered into an employment agreement in
substantially the form of the agreement set forth in Exhibit A.
(d) Financial Condition of Trust Company. As of the
Effective Time, and after having paid for all legal accounting, investment
banking and similar fees and expenses related to the transaction, Trust Company
shall: (1) have equity capital of not less than $1,400,000; (2) shall have cash
and investment securities of not less than $1,200,000; (3) have not less than
$80 Million of assets under management; and (4) shall have recurring annualized
fees resulting from assets under management of not less than $550,000.
(e) Dissenting Shares. No more than 15% of Trust Company
Shares shall be Dissenting Shares.
(f) Shareholder Agreements. If a Shareholder Agreement
has not been signed by each of the officers and directors of Trust Company.
ARTICLE VIII
TERMINATION
8.01 Termination. This Agreement may be terminated, and the Merger
may be abandoned:
(a) Mutual Consent. At any time prior to the Effective
Time, by the mutual consent of FNBI, the Bank and Trust Company.
(b) Breach. At any time prior to the Effective Time, by
FNBI, the Bank and Trust Company in the event of either: (1) a breach by the
other party of any representation or warranty contained herein (subject to the
standard set forth in Section 9.09(b), which breach cannot be or has not been
cured within 30 days after the giving of written notice to the breaching party
of such breach, or (2) a breach by the other party of any of the covenants or
agreements contained herein, which breach cannot be or has not been cured within
30 days after the giving of written notice to the breaching party of such breach
and which breach would be reasonably likely, individually or in the aggregate,
to have a Material adverse effect on the breaching party or the Surviving
Corporation.
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(c) Delay. At any time prior to the Effective Time, by
FNBI, the Bank or Trust Company in the event that the Merger is not consummated
by June 30, 2004, except to the extent that the failure of the Merger then to be
consummated arises out of or results from the knowing action or inaction of the
party seeking to terminate pursuant to this Section 8.01(c).
(d) No Approval. By Trust Company, FNBI or the Bank in
the event (1) the approval of any Governmental Authority required for
consummation of the Merger and the other transactions contemplated by this
Agreement shall have been denied by final nonappealable action of such
Governmental Authority, or such Governmental Authority shall have requested the
permanent withdrawal of any application therefor, or any such approval shall be
made subject to any condition or restriction described in the proviso to Section
7.01(b), or (2) any stockholder approval required by Section 7.01(a) is not
obtained at the Trust Company Meeting.
(e) Failure to Recommend or in Connection with an
Acquisition Proposal. By FNBI or the Bank, if at any time prior to the Trust
Company Meeting the Trust Company Board shall have failed to make its
recommendation referred to in Section 6.02, withdrawn such recommendation or
modified or changed such recommendation in a manner adverse to the interests of
FNBI or the Bank (whether in accordance with Section 6.02 or otherwise), or by
Trust Company after receipt of an Acquisition Proposal (as defined in Section
6.02). If FNBI and the Bank or Trust Company terminates this Agreement pursuant
to this Section 8.01(e) following receipt by Trust Company of an Acquisition
Proposal, then, within five business days of such termination, Trust Company
shall pay FNBI by wire transfer in immediately available funds a fee of $250,000
(the "Termination Fee").
(f) Shareholder Agreements. If a Shareholder Agreement
has not been signed by each of the officers and directors of Trust Company on or
before November 1, 2003.
8.02 Effect of Termination and Abandonment. In the event of
termination of this Agreement and the abandonment of the Merger pursuant to this
Article VIII, no party to this Agreement shall have any liability or further
obligation to any other party hereunder except (1) as set forth in Sections
8.01(e), 9.01 and 9.05 and (2) that termination will not relieve a breaching
party from liability for any willful breach of this Agreement.
-32-
ARTICLE IX
MISCELLANEOUS
9.01 Survival. No representations, warranties, agreements and
covenants contained in this Agreement shall survive the Effective Time or the
termination of this Agreement if this Agreement is terminated prior to the
Effective Time; provided, however, that (a) the agreements of the parties
contained in this Article IX shall survive the Effective Time and (b) if this
Agreement is terminated prior to the Effective Time, the agreements of the
parties contained in Sections 6.03(b), 6.04, 8.02 and 8.01(e) and in this
Article IX shall survive such termination.
9.02 Waiver; Amendment. Prior to the Effective Time, any provision
of this Agreement may be (1) waived by the party benefited by the provision, or
(2) amended or modified at any time, by an agreement in writing between the
parties hereto approved or authorized by their respective Boards of Directors
and executed in the same manner as this Agreement, except that, after approval
of the Merger by the shareholders of Trust Company, no amendment may be made
which under applicable law requires further approval of such shareholders
without obtaining such required further approval.
9.03 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to constitute an original.
9.04 Governing Law. This Agreement shall be governed by, and
interpreted in accordance with, the laws of the State of Florida applicable to
contracts made and to be performed entirely within such State.
9.05 Expenses. Except or provided in Section 8.01(e), each party
hereto will bear all expenses incurred by it in connection with this Agreement
and the transactions contemplated hereby.
9.06 Notices. All notices, requests and other communications
hereunder to a party shall be in writing and shall be deemed given
(a) on the date of delivery, if personally delivered or
telecopied (with confirmation) or e-mailed (with confirmation),
(b) on the first business day following the date of
dispatch, if delivered by a recognized next-day courier service, or
(c) on the fifth business day following the date of
mailing, if mailed by registered or certified mail (return receipt requested),
in each case to such party at its address or telecopy number set forth below or
such other address or numbers as such party may specify by notice to the parties
hereto.
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If to FNBI or the Bank, to:
▇▇▇▇ ▇. ▇▇▇▇▇▇▇, President
First National Bancshares, Inc.
1st National Bank & Trust
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
E-mail: ▇▇▇▇.▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇.▇▇▇
With a copies to:
▇▇▇▇▇▇ ▇. Blank
Werner & Blank, LLC
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
E-mail: ▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
If to Trust Company, to:
▇▇▇▇ ▇. ▇▇▇▇▇▇▇, President
The Trust Company of Florida
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
E-mail: ▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇.▇▇▇
With a copy to:
▇▇▇▇ ▇. ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, PA
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: 407-843-2448
E-mail: ▇▇▇▇▇▇▇@▇▇▇.▇▇▇
9.07 Entire Understanding. This Agreement, together with the
Disclosure Schedule, represents the entire understanding of the parties hereto
with reference to the transactions contemplated hereby and this Agreement
supersedes any and all other oral or written agreements heretofore made.
9.08 No Third Party Beneficiaries. Nothing in this Agreement,
expressed or implied, is intended to confer upon any person, other than the
parties hereto or their respective successors
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and permitted assigns, any rights, remedies, obligations or liabilities under or
by reason of this Agreement.
9.09 Interpretation. (a) When a reference is made in this Agreement
to Sections or Schedules, such reference shall be to a Section or Schedule to
this Agreement unless otherwise indicated. The table of contents and headings
contained in this Agreement are for reference purposes only and are not part of
this Agreement. Whenever the words "include," "includes" or "including" are used
in this Agreement, they shall be deemed to be followed by the words "without
limitation." No rule of construction against the draftsperson shall be applied
in connection with the interpretation or enforcement of this Agreement. Whenever
this Agreement shall require a party to take an action, such requirement shall
be deemed to constitute an undertaking by such party to cause its Subsidiaries,
and to use its reasonable best efforts to cause its other Affiliates, to take
appropriate action in connection therewith.
(b) No representation or warranty of Trust Company, FNBI
or the Bank contained in Article IV or Article V shall be deemed untrue or
incorrect, and no party hereto shall be deemed to have breached a representation
or warranty, as a consequence of the existence of any fact, event, or
circumstance that should have been disclosed as an exception to one or more
representations or warranties, unless such fact, event or circumstance
(individually or taken together with all other facts, events or circumstances
that should have been so disclosed with respect to any representation or
warranty contained in Article IV or Article V) is not Previously Disclosed and
would be Material with respect to Trust Company, FNBI or the Bank, respectively.
* * *
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed in counterparts by their duly authorized officers, all as of the day
and year first above written.
THE TRUST COMPANY OF FLORIDA
By:/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-----------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Chairman
FIRST NATIONAL BANCSHARES, INC.
By:/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, III
--------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, III
Title: Chairman & CEO
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1ST NATIONAL BANK & TRUST
By:/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, III
--------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, III
Title: Chairman & CEO
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EXHIBIT B
FORM OF SHAREHOLDER AGREEMENT
TO BE SIGNED BY ALL
OFFICERS AND DIRECTORS
OF
THE TRUST COMPANY OF FLORIDA
SHAREHOLDER AGREEMENT
The undersigned (the "Shareholder"), who is a shareholder of The Trust
Company of Florida, a nondepository trust company organized under the laws of
the State of Florida ("FTC"), has executed this Shareholder Agreement to be
effective as of the _____ day of __________, 2003.
RECITALS
A. The Shareholder owns or has the power to vote, ___________
common shares, $65.00 par value per share, of FTC (together with all common
shares and any warrants or options to acquire any common shares which the
Shareholder has or subsequently acquires or obtains the power to vote,
collectively referred to herein as the "Shares").
B. FTC has entered into a certain Agreement and Plan of Merger by
and among FTC, First National Bancshares, Inc., a Florida corporation ("FNBI"),
and its wholly owned subsidiary, 1st National Bank & Trust (the "Bank"), dated
October 17, 2003 (the "Merger Agreement").
C. Under the terms of the Merger Agreement, FTC has agreed to
call a meeting of its shareholders for the purpose of voting upon the approval
of the Merger (together with any adjournments thereof, the "Shareholders'
Meeting").
D. FTC, FNBI and the Bank have made it a condition to their
entering into the Merger Agreement that all directors and officers of FTC,
including the Shareholder, shall have agreed to vote their FTC Shares in favor
of the Merger.
AGREEMENT
Accordingly, the parties hereto agree as follows:
1. AGREEMENT TO VOTE. The Shareholder agrees, subject to Section
2, below, to vote the Shares as follows:
(a) in favor of the adoption of the Merger Agreement at
the Shareholders' Meeting;
(b) against the approval of any proposal relating to a
competing merger or business combination involving an acquisition of FTC or the
purchase of all or a substantial portion of the assets of FTC by any person or
entity other than FNBI, the Bank or another affiliate of FNBI; and
(c) against any other transaction which is inconsistent
with the obligation of FTC to consummate the Merger in accordance with the
Merger Agreement.
2. LIMITATION ON VOTING POWER. It is expressly understood and
acknowledged that nothing contained herein is intended to restrict the
Shareholder from voting on any matter, or otherwise from acting, in the
Shareholder's capacity as a director or officer of FTC with respect to any
matter, including but not limited to, the management or operation of FTC. In
addition, Shareholder may be relieved of his/her duties under Section 1 hereof
if the Agreement has been terminated in connection with Section 8.01(e) and FNBI
has been paid the Termination Fee required under such Section.
3. TERMINATION. This Agreement shall terminate on the earlier of
(a) the date on which the Merger Agreement is terminated in accordance with
Article VIII of the Merger Agreement, or (b) the date on which the Merger is
consummated. The obligations of any Shareholder under this Agreement shall
survive the death of such Shareholder and shall be binding upon his/her
successors and assigns.
4. REPRESENTATIONS AND WARRANTIES. The Shareholder hereby
represents and warrants to FNBI and the Bank that (a) the Shareholder has the
capacity and all necessary power and authority to vote the Shares, and (b) this
Agreement constitutes a legal, valid, and binding obligation of the Shareholder,
enforceable in accordance with its terms, except as may be limited by
bankruptcy, insolvency, or similar laws affecting enforcement of creditors
rights generally.
5. ADDITIONAL COVENANTS OF THE SHAREHOLDER. The Shareholder
further agrees that, during the term of this Agreement, the Shareholder will
not, without the prior written consent of FNBI and the Bank, which consent shall
not be unreasonably withheld, sell, pledge, or otherwise voluntarily dispose of
any of the Shares which are owned by the Shareholder or take any other voluntary
action which would have the effect of removing the Shareholder's power to vote
the Shares or which would be inconsistent with this Agreement; provided,
however, that any transferee to which FNBI and the Bank give their prior written
consent must execute an identical Shareholder Agreement.
6. NONCOMPETITION AND NONSOLICITATION. The Shareholder agrees
that for a period of two (2) years from the date of termination of their
affiliation with FTC, FNBI or the Bank, whether as director, officer or
shareholder, (i) Shareholder will not, and will not permit any of his/her
affiliates to, alone, together or in association with others, either as
principal, employee, agent, owner, shareholder, officer, director, partner,
lender, investor, independent contractor, consultant or in any other capacity,
engage in, have a financial interest in or be in any way connected or affiliated
with, or render advice or services to any person that engages in a business that
would compete with the principal business conducted by or any business planned
by FNBI, FTC, the Bank or any of their respective subsidiaries or affiliates of
which Shareholder is actually aware in Sarasota or Lake Counties, Florida, or
any contiguous county; and (ii) Shareholder will not, and will not permit any
affiliate, directly or indirectly, to solicit, divert, take away or interfere
with, the relationship of FNBI, the Bank, FTC or any of their respective
subsidiaries or affiliates with any person who is or was a customer, a
prospective customer whom Shareholder learned of in his/her position with FTC,
the Bank or FNBI, or employee or supplier of FTC, the Bank or FNBI or any of
their respective subsidiaries or affiliates at any time during the last
thirty-six (36) month period immediately prior to the date of this Agreement.
This provision shall not limit or
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restrict the Shareholder's ownership of 2% or less of any securities of a
company filing periodic reports with the Securities and Exchange Commission
under the Securities Exchange ▇▇▇ ▇▇▇▇.
7. SPECIFIC PERFORMANCE. The undersigned hereby acknowledges that
damages would be an inadequate remedy for any breach of the provisions of this
Agreement and agrees that the obligations of the Shareholder shall be
specifically enforceable and that FNBI and the Bank shall be entitled to
injunctive or other equitable relief upon such a breach by the Shareholder. The
Shareholder further agrees to waive any bond in connection with the obtaining of
any such injunctive or equitable relief. This provision is without prejudice to
any other rights that FNBI or the Bank may have against the Shareholder for any
failure to perform his obligations under this Agreement. If a judicial
determination is made that any of the provisions of Section 6 constitutes an
unreasonable or otherwise unenforceable restriction against the Shareholder, the
provisions of Section 6 shall be rendered void, but only to the extent that such
judicial or arbitral determination finds such provision to be unreasonable or
otherwise unenforceable. In this regard, the parties hereto hereby agree that
any judicial authority construing this Agreement shall, without limitation, be
empowered to sever any prohibited business activity, geographic restriction, or
any time period from the coverage of Section 6 and to apply the provisions of
Section 6 to the remaining business activities, geographic area, and the
remaining time period not so severed by such judicial authority.
8. GOVERNING LAW. This Agreement shall be construed and enforced
in accordance with the laws of the State of Florida without regard to any of its
conflict of laws principles.
9. CAPITALIZED TERMS. Capitalized terms used herein without
definition shall have the meanings attributed to such terms in the Merger
Agreement.
IN WITNESS WHEREOF, the undersigned has executed this Shareholder
Agreement as of the day and year first above written.
SHAREHOLDER:
________________________________
Signature
________________________________
Print Name
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EXHIBIT C
TITLES OF OFFICERS
OF
THE TRUST COMPANY
AFTER THE MERGER
NAME CURRENT TITLE TITLE WITH THE BANK AFTER THE MERGER
---- ------------- ------------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇▇ President Senior Vice President and Senior Trust Officer
▇▇▇▇▇ ▇. ▇▇▇▇ Vice President Vice President and Trust Officer
▇▇▇▇▇ ▇▇▇▇▇▇ Vice President Vice President and Trust Officer