PURCHASE AND ASSUMPTION AGREEMENT
This Agreement, dated as of October 3, 2000, is by and
between Capital City Bank, a state chartered bank organized under
the laws of Florida ("Buyer") and First Union National Bank, a
national banking association organized under the laws of the
United States of America ("Seller").
I. DEFINITIONS
1.1 Certain Defined Terms.
Some of the capitalized terms appearing in this
Agreement are defined below. The definition of a term expressed
in the singular also applies to that term as used in the plural
and vice versa. The word "including" as used herein shall mean
"including without limitation."
"ATM Service Facility" means the remote free-standing
automated teller machine facility listed on Schedule 1.1(a),
which facility is subject to a Real Property Lease.
"Adjusted Closing Statement" has the meaning set forth
in Section 3.2(b) of this Agreement.
"Affiliate" means a Person that directly or indirectly,
through one or more intermediaries, controls, is controlled by,
or is under common control with, a specified Person, except in
those cases where the controlling Person exercises control solely
in a fiduciary capacity.
"Amount of Premium" has the meaning set forth in
Section 3.1 of this Agreement.
"Assets" has the meaning set forth in Section 2.1 of
this Agreement.
"Benefit Plan" means any pension, profit-sharing, or
other employee benefit, fringe benefit, severance or welfare plan
maintained by or with respect to which contributions are made by,
Sellers or any of their Affiliates with respect to Seller's
Employees.
"Branches" means those branch offices and/or financial
centers of Seller listed on Schedule 1.1(a), indicating whether
such Branch is Owned Real Property or subject to a Real Property
Lease.
"Business Day" means any Monday, Tuesday, Wednesday,
Thursday or Friday on which Seller is open for business.
"Buyer Material Adverse Effect" means an event,
occurrence or circumstance which has a material adverse effect on
Buyer's ability to timely perform its obligations under this
Agreement or consummate the transactions contemplated by this
Agreement; provided, that a Buyer Material Adverse Effect shall
not include: (i) events or conditions generally affecting the
financial services industry or effects resulting from general
economic conditions (including changes in interest rates),
changes in accounting practices or changes to statutes,
regulations or regulatory policies, that do not have a materially
more adverse effect on Buyer than that experienced by similarly
situated financial services companies, or (ii) events, impacts or
conditions caused by the public announcement of, and response or
reaction of customers, vendors, licensors or employees of Buyer
to, this Agreement or any of the transactions contemplated by
this Agreement.
"Cash Reserve Lines of Credit" means those consumer
lines of credit made available to customers of the Branches as a
protection against overdrafts on the Deposit Accounts.
"Cash Reserve Loans" means those loans outstanding on
the Closing Date pursuant to Cash Reserve Lines of Credit.
"Closing" means the purchase of the Assets by Buyer and
the assumption of the Liabilities by Buyer on the Closing Date.
"Closing Date" has the meaning set forth in Section 9.1
of this Agreement.
"Closing Statement" has the meaning set forth in
Section 3.2(a) of this Agreement.
"Consumer Loans" means the consumer direct installment
loans and certain other consumer lines of credit and loans
relating to the Branches , as of the Closing Date. A listing of
all such loans, as of July 31, 2000, is set forth on Schedule
1.1(b), and such schedule shall be updated by Seller in
connection with the preparation of the Closing Statement and the
Adjusted Closing Statement as set forth in Sections 3.1 and 3.2,
respectively.
"Deposit Accounts" means the deposit accounts at the
Branches, or otherwise assumed by Buyer pursuant to this
Agreement, the balances of which are included in the Deposits or
would be so included if the Deposit Account had a positive
balance.
"Deposits" means all deposits (as defined in 12 U.S.C.
Section 1813(l)) which are booked at each of the Branches as of
the close of business on the Closing Date or otherwise assumed by
Buyer pursuant to this Agreement, including, without limitation,
consumer and business and commercial (i) demand deposits, (ii)
interest checking accounts, (iii) money market accounts, (iv)
savings deposits, (v) time deposits, (vi) jumbo time deposits,
(vii) deposits held pursuant to Retirement Plans, and (viii)
deposits relating to debit cards and ATM cards, including in each
case accrued but unpaid interest and both collected and
uncollected funds, but excluding (v) deposits subject to pending
or threatened litigation; (w) deposits subject to liens, other
than the Loans and the Cash Reserve Loans, (x) deposits held in
accounts for which Seller acts as fiduciary (other than deposits
held by Retirement Plans, subject to section 2.9); (y) deposits
held pursuant to Seller's CAP asset management accounts; and (z)
deposits constituting official checks, travelers checks, money
orders or certified checks.
"Employees" means the employees of Seller employed at
the Branches on the Closing Date, and listed on Schedule 8.1, as
such schedule may be adjusted on the Closing Date.
"ERISA" means the Employee Retirement Income Security
Act of 1974, as amended.
"ERISA Affiliate" means any entity that is considered
one employer with Sellers under Section 4001 of ERISA or Section
414 of the Internal Revenue Code of 1986, as amended.
"Excluded Loan" has the meaning set forth in this
Section 1.1 in the definition of Loans.
"Federal Funds Rate" means, for any day, the rate per
annum (expressed on a basis of calculation of actual days in a
year) equal to the "near closing bid" federal funds rate
published in The Wall Street Journal on the Business Day
following the Closing Date.
"Fixed Assets" means all fixtures (including signage
poles), leasehold improvements, furnishings (excluding artwork
owned by Seller), vaults, safe deposit boxes, computers,
equipment (including, for example, all ATM machines, but
excluding any proprietary software), communications equipment,
security system equipment, supplies (other than forms and other
supplies which bear Seller's name or logo), and other personal
property, which are owned by Seller and which are located at the
Owned Real Property and the Leased Facilities on the Closing
Date, and which are set forth on Schedule 1.1(c).
"Governmental Entity" means any government or any
agency, bureau, board, commission, court, department, official,
political subdivision, tribunal or other instrumentality of any
government having authority in the United States, whether
federal, state or local.
"Hazardous Material" means any substance presently
listed, defined, designated or classified as hazardous, toxic,
radioactive or dangerous or otherwise regulated, under any
applicable state or federal law relating to the protection,
preservation or restoration of the environment, including, but
not limited to, the following federal environmental laws: the
Comprehensive Environmental Response, Compensation and Liability
Act of 1980, the Superfund Amendment and Reauthorization Act, the
Water Pollution Control Act of 1972, the Clean Air Act, the Clean
Water Act, the Resource Conservation and Recovery Act of 1976,
the Solid Waste Disposal Act, the Toxic Substances Control Act
and the Insecticide, Fungicide and Rodenticide Act, each as
amended.
"Leased Facilities" means all Branches and the ATM
Service Facility (including, without limitation, any construction
in progress) that are leased under the Real Property Leases.
"Liabilities" has the meaning set forth in Section 2.2
of this Agreement.
"Loan Instruments" means the loan agreements,
promissory notes, mortgages, deeds of trust, security agreements,
pledge agreements, guaranty agreements, insurance policies,
financing statements, and any other such contract documents
relating to the Loans.
"Loans" means the Consumer Loans to be transferred to
Buyer on the Closing Date; provided, however, Loans shall not
include (i) non-accrual loans (which term shall include loans in
which the collateral securing the same has been repossessed or as
to which collection efforts have been instituted or claim and
delivery or foreclosure proceedings have been filed); (ii) loans
90 days or more past due as to principal or interest; or (iii)
loans in connection with which the obligor has filed a petition
for relief under the United States Bankruptcy Code, or otherwise
has indicated an inability or refusal to pay the Loan as it
becomes due, prior to the Closing (Loans that satisfy any of such
conditions set forth in (i), (ii) or (iii) shall be referred to
as "Excluded Loans").
"Marketable Title" means marketable fee simple title to
the Owned Real Property. Marketable Title shall be determined
according to applicable Title Standards adopted by authority of
the Georgia Bar. Marketable Title shall also mean that Buyer
will obtain at its cost and expense a title insurance commitment
with respect to each parcel of Owned Real Property which is
issued by a reputable title insurance company of national
standing for an ALTA Form-B title insurance policy in the amount
of the Fair Market Value as determined pursuant to Section 3.3,
subject only to such exceptions as would not render title
unmarketable.
"Mediator" means a firm of independent accountants of
nationally recognized standing (other than a firm that has
performed services for Seller or Buyer or any of their Affiliates
during the past three years) mutually agreeable to Seller and
Buyer.
"Overdrafts" means those overdrafts of the book balance
of any Deposit Accounts which are not subject to Cash Reserve
Lines of Credit.
"Owned Real Property" means (i) the land (including the
improvements thereon) on which are located any Branches that are
listed as "Owned Real Property" on Schedule 1.1(a), and (ii) any
building or other improvements relating to such owned real estate
(including, without limitation, any construction in progress)
that are owned by Seller pursuant to which a Branch is operated.
"Person" means an association, a corporation, an
individual, a partnership, a trust or any other entity or
organization, including a Governmental Entity.
"Real Property Leases" means the lease agreements
pursuant to which any Branches listed as leased real property in
Schedule 1.1(b) and the ATM Service Facility are leased by
Seller.
"Retirement Plans" means those non-discretionary
individual retirement accounts and qualified retirement plan
accounts relating to the Deposits for which Seller acts as
custodian or trustee.
"Seller Material Adverse Effect" shall mean an event,
occurrence or circumstance which has a material adverse effect on
the Assets, taken as a whole, or Seller's ability to timely
perform its obligations under this Agreement or consummate the
transactions contemplated by this Agreement; provided, that a
Seller Material Adverse Effect shall not include (i) events or
conditions generally affecting the financial services industry or
effects resulting from general economic conditions (including
changes in interest rates), changes in accounting practices or
changes to statutes, regulations or regulatory policies, that do
not have a materially more adverse effect on Seller than that
experienced by similarly situated financial services companies,
or (ii) events, impacts or conditions caused by the public
announcement of, and response or reaction of customers, vendors,
licensors or employees of Seller to, this Agreement or any of the
transactions contemplated by this Agreement.
"Tenant Lease" shall mean the lease, dated as of
October 1, 1993, between the Seller and The Glamour Box, Inc., as
amended, for the premises located at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇.
"Welfare Benefit Plans" means those Benefit Plans which
are "welfare benefit plans" as defined by ERISA.
"Working Agreement" has the meaning set forth in
Section 2.7 of the Agreement.
II. PURCHASE OF ASSETS AND ASSUMPTION OF LIABILITIES
2.1 Purchase of Assets.
Subject to the terms and conditions of this Agreement,
including Section 6.6 and 7.3, Seller agrees to sell, assign and
transfer possession of and all right, title and interest of the
Seller in and to the following assets to Buyer (the "Assets") and
Buyer agrees to purchase the same from Seller, as of the close of
business on the Closing Date:
(a) the Owned Real Property;
(b) Seller's rights under the Real Property Leases;
(c) the Fixed Assets;
(d) the Loans, including the collateral for the Loans,
and the Loan Instruments;
(e) cash on hand in the Branches;
(f) the Cash Reserve Loans;
(g) the Overdrafts;
(h) Seller's rights under the Cash Reserve Lines of
Credit and any safe deposit box rental agreements relating
to safe deposit boxes located at the Branches; and
(i) Seller's rights as landlord under the Tenant Lease.
2.2 Assumption of Liabilities.
Subject to the terms and conditions of this Agreement,
including Section 6.6 and Section 7.3, Buyer agrees to assume,
pay, perform and discharge the following liabilities of Seller
(the "Liabilities") as of the close of business on the Closing
Date from and after the Closing Date:
(a) the Deposits and all terms and agreements relating
to the Deposit Accounts;
(b) Seller's duties and responsibilities relating to
the Deposits with respect to: (i) the abandoned property
laws of any state, (ii) any legal process which is served on
Seller on or before the Closing Date with respect to
garnishment claims against or for the Deposits that is not
over and above the amount of the Deposits; or (iii) any
other applicable law;
(c) Seller's duties and responsibilities with respect
to the Real Property Leases;
(d) Seller's duties and responsibilities with respect
to the Loans, including the collateral for the Loans, and
the Loan Instruments;
(e) Seller's duties and responsibilities with respect
to the Cash Reserve Lines of Credit;
(f) Seller's duties and responsibilities with respect
to the Cash Reserve Loans;
(g) Seller's duties and responsibilities with respect
to the Overdrafts;
(h) Seller's duties and responsibilities with respect
to the safe deposit boxes located at the Branches;
(i) Seller's duties and responsibilities with respect
to the Retirement Plans as contemplated by Section 2.9; and
(j) Seller's duties and responsibilities as landlord
under the Tenant Lease.
Buyer shall not assume any other liabilities of Seller.
2.3 Transfer and Availability of Books and Records.
On the Closing Date, or as soon thereafter as is
practicable, Seller will transfer and deliver to Buyer such books
and records relating to the Assets and the Liabilities as exist
and are in the possession or control of Seller (except that,
subject to the same exceptions set forth in the next to last
sentence of this Section 2.3, Seller shall be permitted to retain
such books and records that contain information primarily
relating to other assets and liabilities not constituting Assets
and Liabilities; provided that in any such case Seller shall
provide to Buyer such portions or copies of such books and
records as are reasonably necessary to service the Deposits, the
Loans and the Cash Reserve Loans on an ongoing basis). All books
and records relating to the Assets and the Liabilities held by
Seller or Buyer after the Closing Date shall be maintained in
accordance with (and for the period provided in) that party's
standard recordkeeping policies and procedures. Throughout such
period, the party holding such books and records shall comply
with the reasonable request of the other party to provide copies
of specified documents, at the expense of the requesting party;
provided, however, the parties shall not be required to provide
access to, or copies of, any documents or information to the
other party to the extent that such access or copies would
violate or prejudice the legal rights of any customer or employee
or attorney-client privilege or would be contrary to law, rule,
regulation or any legal or regulatory order or process. The
requesting party shall give reasonable notice of any such
request.
2.4 Tax Matters.
(a) Notwithstanding Section 2.5, Buyer and Seller shall
each pay one-half of any sales and use taxes and any
interest and penalties thereon which are payable or arise as
a result of this Agreement or the consummation of any of the
transactions contemplated by this Agreement.
(b) Notwithstanding Section 2.5, Buyer shall pay to
Seller or the relevant taxing jurisdiction (as appropriate
under the circumstances), or reimburse Seller if Seller
shall have paid, any real property recording costs arising
out of the transfer of the Owned Real Property, the Leased
Facilities, the Real Property Leases, the Loans and the
Fixed Assets.
(c) Notwithstanding Section 2.5, Seller shall pay to
Buyer or the relevant taxing jurisdiction (as appropriate
under the circumstances), or reimburse Buyer if Buyer shall
have paid, any real property documentary or similar stamp
taxes arising out of the transfer of the Owned Real
Property, the Leased Facilities, the Real Property Leases,
the Loans and the Fixed Assets.
2.5 Proration of Certain Expenses.
Subject to the provisions of Section 2.4, all rentals,
real estate taxes, personal property taxes (tangible or
intangible), and utility, water and sewer charges and
assessments, as well as semiannual assessments paid to the Bank
Insurance Fund or the Savings Association Insurance Fund with
respect to the Deposits, shall be prorated between Buyer and
Seller as of the close of business on the Closing Date.
2.6 Back Office Conversion and Expenses.
Seller and Buyer shall cooperate with each other and
shall use their reasonable best efforts (consistent with their
internal day-to-day operations) in order to cause the timely
transfer of information concerning the Assets and the Liabilities
which is maintained on Seller's data processing systems so that
Buyer can incorporate such information into Buyer's data
processing systems no later than the opening of business on the
Business Day following the Closing Date. Buyer also agrees to
pay a per item fee of $1.00 for each ACH or paper item after
ninety (90) days. In addition to the foregoing, Buyer hereby
agrees to pay all fees and expenses (except as otherwise
indicated in Section 2.4) relating to the assignment of the Loans
from Seller to Buyer. It being understood and agreed, however,
that the parties, agree that Loan and collateral transfer
mechanics will be determined based upon the characteristics of
each category of loan involved. A blanket endorsement/assignment
of notes, titles and other associated security instruments
included in the Assets is satisfactory with respect to certain
loan categories, with the understanding that there shall be at
least one blanket assignment per county and any note will be
endorsed separately where there is legitimate reason for the
same. With respect to real estate loans, Seller will provide
Buyer with a prepared non-recorded assignment. Buyer will record
assignment promptly and will bear all related recording fees.
2.7 Processing of Certain Items Pre and Post Closing.
A draft of the written practices and procedures under
which Buyer and Seller shall, among other things, complete the
conversion of the Branches and handle certain post closing
matters, including, without limitation, all items (including, for
example, automated clearing house and electronic funds transfer
items) relating to the Assets and the Liabilities, which are
presented or returned following the Closing Date, and any claims
relating to such items, is attached to this Agreement as Exhibit
A (the "Working Agreement"). As promptly as practicable
following the execution of this Agreement, the parties agree to
finalize the Working Agreement, which shall be substantially in
the form of Exhibit A. Notwithstanding the foregoing, it is
understood and agreed that the post-Closing exchange of ACH and
paper items (checks and deposits) between Seller and Buyer shall
continue for a period of 90 days after the Closing Date, and any
items submitted to Seller following the expiration of such 90 day
period shall be returned by Seller.
2.8 Information Returns.
Unless otherwise agreed by Buyer and Seller in writing,
(i) Seller will report to the applicable tax authorities and
customers of the Branches all reportable payments made or
received in connection with the Branches (including without
limitation amounts reportable on Internal Revenue Service Form
1099) from January 1 of the year of the Closing Date through and
including the Closing Date and, in connection with any such
payments, shall withhold and pay over to the applicable tax
authorities any amounts required to be so withheld and paid over
and (ii) Buyer will report to the applicable tax authorities and
customers of the Branches all reportable payments made or
received in connection with the Branches (including without
limitation amounts reportable on Internal Revenue Service Form
1099) from the day after the Closing Date through and including
December 31 of the year of the Closing Date and, in connection
with any such payments, shall withhold and pay over to the
applicable tax authorities any amounts required to be so withheld
and paid over. For purposes of the foregoing, the term reportable
payments as used in this Section 2.8 shall include, but shall not
be limited to, interest paid on the Deposits, interest received
on the Loans and the Cash Reserve Loans, and any other
information returns required with respect to the Assets and the
Liabilities.
2.9. Actions With Respect to Retirement Plan Deposits.
Seller shall (i) resign as of the close of business on
the Closing Date as the trustee or custodian, as applicable, of
each Retirement Plan deposit of which it is the trustee or
custodian, (ii) to the extent permitted by the documentation
governing each such Retirement Plan and applicable law, appoint
Buyer (or one of Buyer's Affiliates designated by Buyer) as
successor trustee or custodian, as applicable, of each such
Retirement Plan, and Buyer or such Affiliate agrees to accept
each such trusteeship or custodianship and assume all fiduciary
obligations with respect thereto as of the close of business on
the Closing Date, and (iii) deliver to the ▇▇▇ grantor or ▇▇▇▇▇
Plan named fiduciary of each such Retirement Plan such notice of
the foregoing as is required by the documentation governing each
such Retirement Plan or applicable law. If, pursuant to the
terms of the documentation governing any such Retirement Plan or
applicable law, (x) Seller is not permitted to name Buyer or its
Affiliate as successor trustee or custodian or the ▇▇▇ grantor or
▇▇▇▇▇ Plan named fiduciary objects in writing to such assignment,
or is entitled to, and does, in fact name a successor trustee or
custodian other than Buyer of its Affiliate, or (y) such
Retirement Plan includes assets, which are not deposit
liabilities of Seller and are not being transferred to Buyer, and
the assumption of the deposit liabilities of Seller included in
such Retirement Plan would result in a loss of qualification of
such Retirement Plan under the Internal Revenue Code of 1986, as
amended, or applicable Internal Revenue Service regulations, all
deposit liabilities held under such Retirement Plan shall be
excluded from the Deposits.
2.10 Risk of Loss.
If the Branches or Fixed Assets are damaged by fire or
other casualty prior to the Closing Date, Buyer shall have the
option of either: (a) utilizing any insurance proceeds payable
by virtue of such loss or damage to restore the damaged Branches
or Fixed Assets; or (b) terminating this Agreement solely with
respect to the obligations of Buyer to purchase the damaged
Branches or Fixed Assets or any of the other Assets related
thereto and/or to assume the Liabilities related thereto (other
than the Loans and Deposits, at Buyer's option), without
liability to Buyer.
III. CONSIDERATION
3.1 Calculation.
In consideration of Buyer's purchase of the Assets and
its assumption of the Liabilities, Seller agrees to pay to Buyer
an amount equal to the Deposits, plus accrued interest thereon,
less the sum of the following (the "Purchase Price"), in each
case calculated as of the close of business on the Closing Date:
(a) the net book value, as determined in accordance
with generally accepted accounting principles ("GAAP"),
consistently applied, of the Fixed Assets as of the Closing
Date;
(b) the Fair Market Value of the Owned Real Property
determined in accordance with Section 3.3 in consideration
of the Owned Real Property as of the Closing Date;
(c) the principal amount of the Loans and the Cash
Reserve Loans, plus accrued interest thereon;
(d) the amount of cash on hand at the Branches;
(e) the principal amount of the Overdrafts;
(f) the net amount (which may be a negative amount) of
taxes payable by Buyer and Seller under Section 2.4 (i.e.,
the amount payable by Buyer less the amount payable by
Seller);
(g) the net amount (which may be a negative amount) of
any adjustments under Section 2.5 (i.e., the amount payable
by Buyer less the amount payable by Seller); and
(h) an amount equal to 10.95 percent of the daily
Deposit average for the ten days preceding the Closing Date
(the "Amount of Premium"); provided, however, that for
purposes of calculating the Amount of Premium, the Deposits
shall not include (x) public deposits, or (y) deposits that
are the subject of pending or threatened litigation.
3.2 Settlement.
(a) Not later than the Saturday following the Closing
Date, Seller shall deliver to Buyer the closing statement
prepared in accordance with Seller's customary practices and
procedures used in preparing financial statements with
Buyer's input and in accordance with the terms of this
Agreement, substantially in the form of Exhibit B to this
Agreement (the "Closing Statement"), which shall be
completed as of the close of business on the Closing Date
and be the basis of the payment to be made to Buyer's
account on the Monday following the Closing Date (the
"Settlement Payment").
(b) The parties shall cooperate in the preparation of
the adjusted closing statement within 30 days after the
Closing Date which shall be prepared in accordance with
Seller's customary practices and procedures used in
preparing financial statements and in accordance with the
terms of this Agreement, substantially in the form of
Exhibit C to this Agreement (the "Adjusted Closing
Statement"), which shall be completed as of the close of
business on the Closing Date. By 10:00 A.M. on the Business
Day after Buyer and Seller agree to the Adjusted Closing
Statement, or Buyer and Seller receive notice of any
determination of the Adjusted Closing Statement under
subsection (c) below, Seller shall pay by wire transfer to
Buyer (or Buyer shall pay by wire transfer to Seller, as the
case may be) an amount (the "Adjustment Payment") equal to
the amount due stated on the Adjusted Closing Statement,
plus interest from the day after the Closing Date through
the Adjustment Payment Date at a rate per annum (calculated
daily based on a 360-day year) equal to the Federal Funds
Rate.
(c) If the parties are unable to agree on the Adjusted
Closing Statement within 30 days after the Closing Date,
either party may submit the matter to the Mediator, which
shall determine all disputed portions of the Adjusted
Closing Statement in accordance with the terms and
conditions of this Agreement within 30 days after the
submission. The parties shall each pay half of the fees and
expenses of the Mediator, except that the Mediator may
assess the full amount of its fees and expenses against
either party if it determines that party negotiated the
Adjusted Closing Statement in bad faith. The Adjusted
Closing Statement, as agreed upon by the parties and/or
determined under this subsection, shall be final and binding
upon the parties.
(d) The Settlement Payment and the Adjustment Payment
shall each be made by wire transfer of immediately available
funds to the account of the party receiving the payment,
which account shall be identified by the party receiving the
funds to the other party not less than two Business Days
prior to such payment.
3.3 Fair Market Value.
The fair market value of the Owned Real Property for
purposes of Section 3.1(b) (the "Fair Market Value") shall be
determined in accordance this Section 3.3 no later than seventy-
five(75) days after the date hereof. Within ten (10) Business
Days after the date hereof, the Buyer shall deliver to the Seller
a list of three (3) appraisers selected by Buyer. Seller shall
then within five (5) days of receiving such list select one (1)
appraiser (the "Appraiser") from the list and the Appraiser shall
conduct the appraisal under this Section 3.3. The Appraiser
shall determine the Fair Market Value of such Owned Real Property
for its current use prepared in accordance with customary
practices and procedures by an M.A.I. appraiser. For all
purposes hereunder, the Fair Market Value shall be the amount of
cash which the Appraiser determines would be realized by Seller
if Seller sold the Owned Real Property, as a willing seller, to a
willing buyer on the Closing Date, in vacant condition to be used
solely for their current uses, subject to all liabilities, liens,
and other encumbrances to which the Owned Real Property is
subject. The costs of any such appraisals shall be paid by
Buyer.
3.4 Overdraft Repurchases.
Subject to the provisions set forth in this Section
3.4, Seller agrees to repurchase from Buyer, on demand,
Overdrafts which have remained outstanding for forty-five (45)
calendar days following the Closing Date. Such repurchase shall
occur within five (5) Business Days following the forty-five (45)-
day period. The amount of such repurchase shall be equal to the
lesser of the balance of the Overdraft as of the Closing Date or
the lowest balance of the Overdraft during such forty-five (45)-
day period. Notwithstanding Seller's obligation to repurchase
Overdrafts, Buyer shall use its reasonable best efforts to
collect such Overdrafts prior to the expiration of such forty-
five (45)-day period; provided, however, that Buyer's reasonable
best efforts to collect Overdrafts shall not require that it
initiate or pursue any legal action against any person.
IV. SELLER'S REPRESENTATIONS AND WARRANTIES
Seller makes the following representations and
warranties to Buyer.
4.1 Organization, Power and Authority.
(a) Seller is a national banking association duly
organized under the laws of the United States, validly
existing and in good standing. Seller has the corporate
power and authority to enter into and perform this
Agreement. The execution and delivery of this Agreement has
been duly authorized by all necessary corporate action by
Seller. Upon execution and delivery by the parties, this
Agreement will constitute a valid and binding obligation of
Seller, enforceable in accordance with its terms except as
enforcement may be limited by federal and state regulators
of Seller or by bankruptcy, insolvency, reorganization,
moratorium or other laws of general applicability relating
to or affecting creditors' rights, or the limiting effect of
rules of law governing specific performance, equitable
relief and other equitable remedies or the waiver of rights
or remedies.
(b) The performance of this Agreement by Seller will
not violate any provision of the Articles of Association or
charter or Bylaws of Seller, or any applicable law, rule,
regulation, or order or any contract or instrument by which
Seller is bound, except for such violations which alone, or
taken in the aggregate, would not reasonably be expected to
have a Seller Material Adverse Effect.
4.2 Litigation and Regulatory Proceedings.
There are no actions, complaints, petitions, suits or
other proceedings, or any decree, injunction, judgment, order or
ruling, entered, promulgated or pending or (to Seller's
knowledge) threatened against Seller or any of the Assets or the
Liabilities, which alone, or taken in the aggregate, reasonably
would be expected to have a Seller Material Adverse Effect. No
governmental agency has notified Seller that it would oppose or
not approve or consent to the transactions contemplated by this
Agreement and Seller knows of no reason for any such opposition,
disapproval or nonconsent.
4.3 Consents and Approvals.
No consents, approvals, filings or registrations with
any third party or any public body, agency or authority are
required in connection with Seller's consummation of the
transactions contemplated by this Agreement, other than any
required lessor consents to the assignment of the Real Property
Leases and as may be required as a result of any facts or
circumstances relating solely to Buyer.
4.4 Owned Real Property.
(a) Schedule 1.1(a) contains a list of all the Owned
Real Property.
(b) Seller will convey good and Marketable Title, such
as is insurable by any reputable title insurance company, to
the Owned Real Property, free and clear of all encumbrances,
except for easements, restrictions and other encumbrances of
record or visible from the ground, applicable zoning laws,
building restrictions and all other laws of duly constituted
public authorities, grants of public rights of way, standard
exceptions in the title insurance policy (except for those
to be removed pursuant to Section 9.3), and liens for taxes
and assessments not delinquent. Seller shall maintain in
effect from the date of this Agreement until the Closing
Date, all property, liability, fire and casualty insurance
in effect as of the date hereof with regard to the Owned
Real Property, including the structures, leasehold
improvements and Fixed Assets relating to the Branches.
(c) To the knowledge of Seller, Seller has not received
any written notice of violation, citations, summonses,
subpoenas, compliance orders, directives, suits, other legal
process, or other written notice of potential liability
under applicable environmental, zoning, building, fire and
other applicable laws and regulations relating to the Owned
Real Property.
(d) To the knowledge of Seller, Seller has not received
any written notice of a condemnation proceeding relating to
the Branches.
(e) To Seller's knowledge, Seller has received no
notice of any existing or pending special assessments
affecting the Owned Real Property, which may be assessed by
any governmental authority, water or sewer authority,
drainage district or any other special taxing district.
(f) To Seller's knowledge, there are no outstanding
agreements, options or commitments of any nature obligating
Seller to transfer any of the Branches, Owned Real Property
or rights or interests therein to any other party.
(g) To Seller's knowledge there are no leases,
subleases, licenses or other rental agreements or occupancy
agreements (written or oral) which grant any possessory
interest in and to any space situated on or in the Owned
Real Property or that otherwise give rights with regard to
the use of the Owned Real Property or the Leased Facilities
or any portion thereof, except as set forth on Schedule
4.4(g).
4.5 Fixed Assets.
Seller has good and marketable title to the Fixed
Assets, free and clear of all encumbrances, claims, charges,
security interests, or liens, if any, which do not materially
detract from the value of or interfere with the use of the Fixed
Assets. The Fixed Assets are in all material respects in
satisfactory working order and condition, ordinary wear and tear
excepted.
4.6 Ownership of Cash Reserve Loans.
Seller has full power and authority to hold each Cash
Reserve Loan, and has good title to the Cash Reserve Loans free
and clear of all liens and encumbrances. Seller is authorized to
sell and assign the Cash Reserve Loans to Buyer and, upon such
assignment, Buyer will have the rights of Seller with respect to
the Cash Reserve Loans in accordance with the terms and
conditions thereof.
4.7 Loans.
(a) Seller has full power and authority to hold each
Loan, and has good and marketable title to the Loans free
and clear of all liens and encumbrances. Seller is
authorized to sell and assign the Loans to Buyer and, upon
assignment, Buyer will have the rights of Seller with
respect to the Loans in accordance with the terms and
conditions thereof.
(b) Each Loan was originated in conformity in all
material respects with applicable laws and regulations; and
its principal balance as shown on Seller's books and records
is true and correct as of the last day shown thereon. None
of the Loans is an Excluded Loan. Seller has complied in
all material respects with all of their obligations under
the Loan Instruments.
(c) Other than the representations and warranties in
Section 4.7(a) and (b), all Loans and Loan Instruments
transferred to Buyer on the Closing Date pursuant to Section
2.1(d) shall be transferred on an "AS IS" basis and without
recourse to Seller and without any representations or
warranties as to the collectibility of any such Loan or the
creditworthiness of any such obligor.
4.8 Validity of and Compliance with Real Property Leases.
The Real Property Leases are valid and existing leases
under which Seller, as lessee, is entitled to possession of the
leased premises. To Seller's knowledge, no event has occurred
and is continuing, which constitutes a default under any of the
Real Property Leases. Subject to Seller's obtaining any
necessary landlord consents, the assignment of such leases will
transfer to Buyer all of Seller's rights under the Real Property
Leases.
4.9 Compliance with Certain Laws.
The Deposit Accounts and the Cash Reserve Lines of
Credit were opened, extended or made, and have been maintained,
in accordance with all applicable federal, state and local laws,
regulations, rules and orders, and the Branches have been
operated in compliance with Seller's policies and procedures and
all applicable federal, state and local laws, regulations, rules
and orders, except for such instances of noncompliance which do
not have, and are not reasonably likely to have, a Seller
Material Adverse Effect.
4.10 FDIC Insurance.
The Deposits are insured by the Federal Deposit
Insurance Corporation through the Bank Insurance Fund to the
extent permitted by law, and all premiums and assessments
required to be paid in connection therewith have been paid when
due by Seller.
4.11 Deposit, Loan and Other Data.
All written or magnetically (or otherwise) recorded
information relating to the Assets and the Liabilities that have
been delivered (or will be delivered) by or on behalf of Seller
to Buyer was (or will be when delivered in the future) accurate
in all materials respects as of the date provided.
4.12 Organization.
Seller is a national banking association duly
organized, validly existing and in good standing under the laws
of the United States.
4.13 Tenants.
Except as set forth on Schedule 4.13, there are no
tenants or other occupants of the Owned Real Property or the
Leased Facilities.
4.14 Untrue Statements.
No representation or warranty by Seller in this
Agreement or any exhibit hereto, and/or any statement, schedule,
list or officer's certificate furnished or to be furnished to
Buyer pursuant hereto or in connection with the transactions
contemplated hereby contains or will contain, as of the date of
delivery thereof or as amended or supplemented at the Closing
Date and at the date of payment of the Adjustment Payment,
respectively, any untrue statement of material fact, or, to
Seller's knowledge, omits or will omit to state any material
fact, necessary to make the statements contained herein or
therein not misleading.
V. BUYER'S REPRESENTATIONS AND WARRANTIES
Buyer makes the following representations and
warranties to Seller.
5.1 Organization, Power and Authority.
(a) Buyer is a state chartered bank duly organized
under the laws of Florida, validly existing and in good
standing. Buyer has the corporate power and authority to
enter into and perform this Agreement. The execution and
delivery of this Agreement has been duly authorized by all
necessary corporate action by Buyer. Upon execution and
delivery by both parties, this Agreement will constitute a
valid and binding obligation of Buyer, enforceable in
accordance with its terms except as enforcement may be
limited by federal and state regulators of Buyer or by
bankruptcy, insolvency, reorganization, moratorium or other
laws of general applicability relating to or affecting
creditors' rights, or the limiting effect of rules of law
governing specific performance, equitable relief and other
equitable remedies or the waiver of rights or remedies.
(b) The performance of this Agreement by Buyer will not
violate any provision of the Articles of Association,
charter, Bylaws or similar governing documents of Buyer, or
any applicable law, rule, regulation, or order or any
contract or instrument by which Buyer is bound except for
such violations which alone, or taken in the aggregate,
would not reasonably be expected to have a Buyer Material
Adverse Effect.
5.2 Litigation and Regulatory Proceedings.
There are no actions, complaints, petitions, suits or
other proceedings, or any decree, injunction, judgment, order or
ruling, entered, promulgated or pending or (to Buyer's knowledge)
threatened against Buyer or any of its properties or assets which
alone, or taken in the aggregate, reasonably would be expected to
have a Buyer Material Adverse Effect. No governmental agency has
notified Buyer that it would oppose or not approve or consent to
the transactions contemplated by this Agreement, and Buyer knows
of no reason for any such opposition, disapproval or nonconsent.
5.3 Consents and Approvals.
Except for required regulatory approvals no consents,
approvals, filings or registrations with any third party or any
public body, agency or authority are required in connection with
Buyer's consummation of the transactions contemplated by this
Agreement other than what may be required as a result of any
facts or circumstances relating solely to Seller.
5.4 Regulatory Capital and Condition.
To Buyer's knowledge, Buyer is in compliance with all
capital standards as of the date hereof, and has no reason to
believe that it will be unable to obtain the required regulatory
approvals for the transactions contemplated by this Agreement
solely as a result of its current level of regulatory capital.
As of the date of this Agreement, there is no pending or
threatened legal or governmental proceedings against Buyer or to
Buyer's knowledge any Affiliate that would affect Buyer's ability
to obtain the required regulatory approvals or satisfy any of the
other conditions required to be satisfied in order to consummate
any of the transactions contemplated by this Agreement.
5.5 Untrue Statements.
No representation or warranty by Buyer in this
Agreement or any exhibit hereto, and/or any statement, schedule,
list or officer's certificate furnished or to be furnished to
Seller pursuant hereto or in connection with the transactions
contemplated hereby contains or will contain, as of the date of
delivery thereof or as amended or supplemented at the Closing
Date and at the date of payment of the Adjustment Payment,
respectively, any untrue statement of material fact or, to
Buyer's knowledge, omits or will omit to state any material fact,
necessary to make the statements contained herein or therein not
misleading.
VI. ADDITIONAL AGREEMENTS OF SELLER
6.1 Access to Seller's Premises, Records and Personnel.
(a) Upon execution of this Agreement, Seller shall give
Buyer and its representatives such access to the Branches as
Buyer may reasonably request, provided that Buyer does not
unreasonably interfere with the business operations of the
Branches. Seller shall not be required to provide access to
or to disclose information where such access or disclosure
would violate or prejudice the legal rights of any customer
or employee or attorney-client privilege or would be
contrary to law, rule, regulation or any legal or regulatory
order or process or any fiduciary duty or binding agreement
entered into prior to the date of this Agreement, none of
which shall have a material adverse effect on Buyer's
ability to conduct its due diligence under this Agreement.
(b) Anything contained in this Agreement to the
contrary notwithstanding, Seller shall not be required to
disclose, or to cause the disclosure to Buyer or its
representatives (or provide access to any offices,
properties, books or records of Seller, that could result in
the disclosure to such Persons or others), of any tax
returns and/or any work papers relating thereto or any other
confidential information relating to income or franchise
taxes or other taxes of Seller, or trade secrets, patent or
trademark applications, or product research and development
belonging to or performed by or for Seller, nor shall Seller
be required to permit or to cause others to permit Buyer or
its representatives to copy or remove from the offices or
properties of Seller any documents, drawings or other
materials that might reveal any such confidential
information; provided, however, Buyer shall have access to
tax returns to the extent that liability for the taxes at
issue could be imposed on Buyer.
(c) At Buyer's request and subject to Section 11.11,
Seller shall authorize and permit certain of its officers
and members of management to engage in discussions with
Buyer for the purposes of discussing the operations of the
Branches negotiating and concluding management employment
contracts, employee benefit plans, and new incentive plans
and Buyer shall maintain the confidentiality of any
information furnished by such officers or members of
management of Seller pursuant to such discussions with
Buyer, except to the extent disclosure is required by
applicable law or court process.
6.2 Regulatory Approvals.
Seller agrees to use its reasonable best efforts to
obtain promptly any regulatory approval on which its consummation
of the transactions contemplated by this Agreement is
conditioned. Seller also agrees to cooperate with Buyer in
obtaining any regulatory approval which Buyer must obtain before
the Closing. Seller shall notify Buyer promptly of any
significant development and provide copies of all correspondence
with respect to any application it files under this Section.
Seller also shall provide Buyer with a copy of any regulatory
approval it receives under this Section, promptly after Seller's
receipt of the same.
6.3 Conduct of Business.
Except as provided in this Agreement or as may
otherwise be agreed upon by Buyer, Seller will continue to carry
on its operations at the Branches until the Closing in the
ordinary course of business, consistent with prudent business
practices. From the date hereof through the Closing Date, Seller
(a) shall use reasonable efforts to maintain and
preserve intact its advantageous business relationships,
including relationships with the Branches' customers;
(b) other than in the ordinary course of business,
shall not purchase or dispose of any Assets with an aggregate
value in excess of $5,000 without the prior written consent of
Buyer, which shall not be unreasonably withheld;
(c) except as otherwise provided in this Agreement,
shall not specifically encourage or solicit any customer
maintaining an account at the Branches in any manner to transfer
such account to Seller or any other financial institution;
(d) without the prior written consent of Buyer, which
shall not be unreasonably withheld, shall not pay above market
rates on the Deposits or conduct any special promotion or premium
for new accounts or additional deposits to existing accounts
specifically for the Branches;
(e) shall not institute any changes in wages, salaries
or payments paid to employees of the Branches, other than normal
raises and adjustments in the ordinary course of business and
consistent with past practice;
(f) shall not, without the prior written consent of
Buyer, which shall not be unreasonably withheld, make any
commitments for expenditures of a capital nature for the
Branches;
(g) shall not dispose of any part of the Branches
without the consent of Buyer;
(h) shall make no changes in the personnel employed at
the Branches other than terminations for cause or replacement of
departed personnel. Seller shall not transfer any of the
Employees to any of its other facilities from the date hereof
through the Closing Date; provided, however, that Seller may
transfer any Employees who have voluntarily posted for other
positions with Seller, as identified on Schedule 6.3(h), prior to
the date of the announcement of the Agreement. Seller also
agrees that it shall not hire any employees employed at the
Branches after the announcement of the Agreement until the
Closing Date;
(i) shall not change any of its deposit account
practices specific to the Branches, except as required by changes
in applicable law or Seller's practice with respect to its
deposit accounts generally; provided, however, that any such
change in Seller's practices shall not adversely affect the
consummation of the transactions contemplated by the Agreement.
(j) shall not take any action which would materially
affect Buyer's rights hereunder or the Assets or the Liabilities;
and
(k) shall take no action which would adversely affect
or delay the ability of any party hereto to obtain any regulatory
approval or to perform its covenants and agreements under this
Agreement.
Seller shall maintain the Owned Real Property and the
Leased Facilities in their current condition, ordinary wear and
tear excepted and shall not terminate the operation of any
Branch, unless those operations cease due to events beyond
Seller's control or as required by law. Seller will notify Buyer
of any event of which Seller obtain knowledge which would make
any of Seller's representations under Article IV of this
Agreement false in any material respect.
6.4 Covenant of Seller's Not to Solicit.
Seller hereby agrees that for a period of two (2) years
from the Closing Date, Seller and its Affiliates shall not
specifically target and solicit customers of the Branches whose
Deposits or Loans are being assumed or purchased by Buyer;
provided, however, that nothing in this Section 6.4 shall (i)
restrict general mass mailings, telemarketing calls, statement
stuffers, advertisements or other similar communications whether
in print, on radio, television, the Internet, or by other means
that are directed to the general public or to a group of
customers who may include customers of the Branches, provided
that such group is defined by criteria other than primarily as
customers of the Branches,(ii) otherwise prevent Seller or its
Affiliates from taking such actions as may be required to comply
with applicable federal or state laws, rules or regulations or
from servicing or communicating with the then-current customers
of Seller or its Affiliates, or (iii) restrict or prevent Seller
or its Affiliates from soliciting or providing any CAP accounts,
commercial loans, brokerage, capital markets, trust, investment
advisory or any other financial services or products to any
customer whose Deposits are assumed by, or whose Loan is assigned
to, Buyer pursuant to this Agreement or any other customer,
except that neither Seller nor any of its Affiliates may solicit
any deposit or lending business that has the purpose or effect of
replacing in whole or in part any Deposit assumed by, or Loan
assigned to, Buyer pursuant to this Agreement.
6.5. Covenant of Seller not to Compete.
Seller hereby agrees not to open a de novo full-service
branch facility within the county in which each Branch is located
(the "Noncompete Area") for a period of one (1) year from the
Closing Date; provided, however, that the Seller, or its
Affiliates, shall be expressly permitted to acquire a commercial
bank notwithstanding the fact that the commercial bank to be
acquired has a branch or other facility in the Noncompete Area so
long as a substantial part of the business and assets of such
institution are located outside of the Noncompete Area (an
"Acquired Commercial Bank"). In the event that Seller decides to
sell any branches located within the Noncompete Area of such
Acquired Commercial Bank within one (1) year of the date of this
Agreement, then Buyer shall have a right of first refusal with
respect to such branches at the same percentage of premium that
Seller paid to the Acquired Commercial Bank.
6.6 Consents.
Within sixty (60) days from the date hereof, Seller
agrees to use its reasonable best efforts to obtain from lessors
and any other parties to any Real Property Leases any required
consents to the assignment of such leases and agreements that
will occur as a result of this Agreement or the transactions
contemplated hereby. If any such required consent cannot be
obtained, then the Agreement shall be terminated with respect to
such Branch (including with respect to the Assets and Liabilities
associated with such Branch)); provided, however, that prior to
such termination, the parties hereby agree to negotiate in good
faith (including negotiation of the amount of premium with
respect to the deposits associated at such Branch), and Buyer and
Seller shall use their reasonable best efforts, to make
alternative arrangements reasonably satisfactory to Buyer and
Seller that provide Buyer, to the maximum extent reasonably
possible, the benefits of such Branch or other Owned Real
Property or Leased Facility in a manner that does not violate the
underlying lease or agreement.
6.7 Movement of Deposits.
Seller agrees that unless expressly requested by the
customer, accounts will not be moved by Seller into or out of the
Branches until a documented process has been reviewed and
approved by Buyer (details of which shall be documented in the
Working Agreement). All account movement under the approved
process will be completed by thirty (30) days prior to the
Closing Date. Seller also agrees that regardless of the
aforementioned process, all accounts where the customer lives
outside of a centroid of 35 miles of the zip codes of the
Branches and the customer has not transacted business in any of
the Branches for the prior three (3) months will be removed from
the sale no later than thirty (30) days prior to Closing..
6.8 Buyer's Right to Reject Loans.
(a) During the period beginning on a date no later
than seventy-five (75) calendar days after the execution of this
Agreement and ending on the eighth (8th) Business Day after such
date (the "Review Period"), Seller shall afford to the officers
and authorized representatives of Buyer, subject to Seller's
normal security requirements, access to all necessary Loan
Instruments relating to the Loans and Cash Reserve Loans existing
on the date thereof in order that Buyer may have full opportunity
to make reasonable investigations of the Loans and Cash Reserve
Loans, the Loan Instruments and the Loan collateral.
(b) During the period beginning two (2) weeks prior to
the Closing Date and ending three (3) Business Days after such
date (the "New Loan Review Period"), Seller shall afford to the
officers and authorized representatives of Buyer, subject to
Seller's normal security requirements, access to all necessary
Loan Instruments relating to the Loans and Cash Reserve Loans
that were originated after the date hereof and were not included
in the Review Period described in section 6.8(a), in order that
Buyer may have full opportunity to make reasonable investigations
of the Loans and Cash Reserve Loans, the Loan Instruments and the
Loan collateral.
(c) Notwithstanding the foregoing, Seller shall not be
required to provide access to or to disclose information during
the Review Period or the New Loan Review Period where such access
or disclosure would violate or prejudice the legal rights of any
customer or employee or attorney-client privilege or would be
contrary to law, rule, regulation or any legal or regulatory
order or process or any fiduciary duty or binding agreement
entered into prior to the date of this Agreement (none of which
will have a material adverse effect on Buyer's ability to conduct
its due diligence under this Agreement).
(d) No later than four (4) Business Days following the
expiration of the Review Period and the New Loan Review Period,
Buyer shall notify Seller in writing of the existence of any of
the following defects relating to the Loans (any such Loan being
called an "Identified Loan"):
(i) Loan Instruments, which are material to the
enforceability of a Loan, have been lost or are missing or are
reasonably believed by Buyer to be defective or unenforceable;
(ii)a Loan is an Excluded Loan;
(iii) a Loan was not originated or has not been
administered in compliance in all material respects with
applicable laws or the Loan Instruments pertaining to
such Loan are not legal, valid and binding or do not
contain the true signature of an obligor;
(iv)Seller's rights in any collateral are not
perfected or enforceable, or the priority of such rights
are not as reflected in the records;
(v)The Loan is 30-89 days past due;
(vi)The loan has been thirty (30) days past due
more than two (2) times and the most recent FICO score is
less than six hundred (600); or
(vii) any loan that is the subject of pending or
threatened litigation;
(e) Following receipt of any such notice, and at any
time prior to the date of notification to the customers of the
assignment of the Loans pursuant to applicable law, Seller may in
its sole discretions attempt to cure any such defect to Buyer's
reasonable satisfaction. If Seller is unable or unwilling to
cure such defect to Buyer's reasonable satisfaction, Buyer shall
have the right to reject such Identified Loan.
(f) From the period beginning two weeks before the
Closing Date and ending on the Closing Date, Seller shall not
originate any new Loans, or a new Cash Reserve Loan in excess of
$25,000, without the prior consent of Buyer.
(g) Buyer's investigation and right to reject pursuant
to this Section 6.8 shall not modify, diminish or have any affect
on Seller's representations and warranties or obligation to
indemnify Buyer, or on Buyer's rights, set forth in this
Agreement.
VII. ADDITIONAL AGREEMENTS OF BUYER
7.1 Regulatory Approvals.
Buyer shall prepare and file, with the assistance of
Seller, as soon as practicable, but not later than twenty (20)
calendar days following the date of this Agreement, all
applications, as required by law, to the appropriate federal
and/or state regulatory authorities for approval to effect the
transactions contemplated by this Agreement and shall use its
good faith efforts to obtain such approvals. Buyer also agrees
to cooperate with Seller in obtaining any regulatory approval
which Seller must obtain before the Closing. Buyer shall notify
Seller promptly of any significant development with respect to
any application it files under this Section. Buyer also shall
provide Seller with a copy of any regulatory approval it receives
under this Section, promptly after Buyer's receipt of the same.
7.2 Change of Name, Etc.
Immediately after the Closing, Buyer will (a) change
the name and logo on all documents and facilities relating to the
Assets and the Liabilities to Buyer's name and logo, (b) notify
all persons whose Cash Reserve Loans, Loans, or Deposits are
transferred under this Agreement of the consummation of the
transactions contemplated by this Agreement, and (c) provide all
appropriate notices to the Federal Deposit Insurance Corporation
and any other regulatory authorities required as a result of the
consummation of such transactions. Buyer agrees not to use any
forms or other documents bearing Seller's or any Affiliates' name
or logo after the Closing without the prior written consent of
Seller, and, if such consent is given, Buyer agrees that all such
forms or other documents to which such consent relates will be
stamped or otherwise marked in such a way that identifies Buyer
as the party using the form or other document. As soon as
practicable and, in any event, not more than ten (10) nor less
than two (2) calendar days prior to the Closing Date, Buyer will
mail new checks reflecting its transit and routing number to
customers of the Branches with check writing privileges. Buyer
shall use its best efforts to encourage these customers to begin
using such checks and cease using checks bearing Seller's name.
7.3 Owned Real Property and Leased Facilities.
(a) Purchase of Owned Real Property and Assignment of
Leased Facilities.
Except as expressly set forth in this Agreement,
Buyer hereby acknowledges and agrees that: (i) Buyer is
expressly purchasing the Owned Real Property and is
taking assignments of and assuming the Leased
Facilities in its existing condition "AS IS, WHERE IS,
AND WITH ALL FAULTS" with respect to any facts,
circumstances, conditions and defects; (ii) Seller has
no obligation to repair or correct any such facts,
circumstances, conditions or defects or to compensate
Buyer for same; (iii) Seller has specifically bargained
for the assumption by Buyer of all responsibility to
inspect and investigate the Owned Real Property and the
Leased Facilities and of all risk of adverse
conditions; and (iv) Buyer has or will have prior to
the Closing undertaken all such physical inspections
and examinations of the Owned Real Property and the
Leased Facilities as Buyer deems necessary or
appropriate as to the condition of the Owned Real
Property and the Leased Facilities. Except as
expressly set forth in this Agreement, Buyer
acknowledges that Seller has made no representations or
warranties and shall have no liability to Buyer (and
Buyer hereby waives any right to recourse against
Seller) with respect to the conditions of the soil, the
existence or nonexistence of hazardous substances, any
past use of the Owned Real Property, the economic
feasibility of the Owned Real Property and the Leased
Facilities, or the Owned Real Property's and Leased
Facilities' compliance or noncompliance with all laws,
rules or regulations affecting the Owned Real Property
and the Leased Facilities.
(b) Buyer Due Diligence.
Buyer may, at Buyer's option, within forty-five
(45) days from the date of this Agreement, undertake
such physical inspections and examinations of the Owned
Real Property and the Leased Facilities (subject to any
landlord's approval or consent as may be required), and
the legal title thereto, including such inspections of
the buildings thereon, as Buyer deems necessary or
appropriate. The cost of any such inspections and
examinations shall be responsibility of Buyer. On or
before the Closing Date, Buyer may, at Buyer's expense,
have a survey prepared with respect to each Branch.
(i) Existence of Material Defect.
If Buyer shall discover a Material Defect, as
defined herein, as a result of Buyer's inspections
and examinations, Buyer shall give Seller written
notice as soon as possible (but in no event later
than the expiration of the 45 day period)
describing the facts or conditions constituting
such Material Defect and the measures which Buyer
reasonably believes are necessary to correct such
Material Defect. Seller shall notify Buyer within
five (5) days of receipt of such written notice
whether Seller elects to cure such Material Defect
or terminate the Agreement with respect to such
Branch, unless Buyer elects to waive such Material
Defect. If Seller elects to cure, then Seller
shall have thirty (30) days from the date of the
receipt of Buyer's notice, or such later time,
which shall not be later than the Closing Date, as
shall be mutually agreeable to the parties in
which to cure such Material Defect to Buyer's
reasonable satisfaction and Seller's reasonable
cure shall be a condition to Buyer's obligation to
purchase the Assets and assume the Liabilities
with respect to such Branch under this Agreement.
If Seller fails to cure a Material Defect within
such thirty (30) day period, or if Seller elects
not to cure a Material Defect, Buyer may terminate
this Agreement with respect to the Branches that
have such Material Defect (including with respect
to the Assets and Liabilities associated with such
Branches); provided, however, that Buyer agrees
to negotiate with Seller according to the process
described in Section 7.3(b)(ii) prior to
exercising Buyer's right to terminate the
Agreement with respect to any such Branch.
"Material Defect" shall mean the existence of:
(x) a lien or encumbrance or other title
defects on the legal title, or a zoning
violation not waived or grandfathered for use
as a branch bank which would run to Buyer, or
a substantial land use defect affecting use
as a branch bank as shown on a current
accurate survey furnished by Buyer, to the
Owned Real Property (or to the Leased
Facilities, but only to the extent affecting
use as a branch bank), which Seller cannot
clear title or cure the defect by providing
an indemnification to the title insurance
company or other entity or using reasonable
efforts and expending no more than $25,000
with respect to one Owned Real Property
(provided Seller agrees to use reasonable
efforts and expend up to $25,000 to cure such
defects);
(y) any discharge, disposal, release or
emission (or presence, but only if such
presence violates Federal State or local
laws) of any Hazardous Material in the ground
or the structure of the Owned Real Property
or Leased Facilities or the existence of any
underground storage tank for which the Buyer
has been advised in writing by its legal
counsel that the tank is not in compliance
with Federal, state or local laws; or
(z) with respect to the buildings,
material deficiencies in the plumbing,
electrical, HVAC, drive thru air transport
system, roof, walls, or foundations.
Provided, however, that in addition to
satisfying the criteria described in the preceding
subsections (y) and (z), the cost to cure such
conditions shall be more than $10,000
individually, or more than $75,000 in the
aggregate, based on a reasonable good faith
estimate from a reliable third party. The parties
further agree that the provisions set forth in
Section 7.3(b)(ii) shall govern the risk and
responsibility of the parties in connection with
any such expense in excess of such amounts with
respect to each Owned Real Property and Leased
Facility.
(ii) Continued Existence of Material Defect;
Negotiation by Buyer and Seller.
If Seller does not elect to cure any such
Material Defect or is unable to cure such Material
Defect to Buyer's reasonable satisfaction at least
thirty (30) days prior to the Closing, and Buyer
does not elect to waive such Material Defect, the
parties shall negotiate in good faith with a view
towards arriving at a mutually acceptable
resolution of the issue. The parties further
intend that the effort to identify a mutually
acceptable resolution shall include consideration
by the parties of the following:
(x) subject to Seller's ability to do so
pursuant to the terms of its Real Property
Lease relating to any Leased Facilities,
Buyer may in its sole discretion purchase the
assets related to the subject Owned Real
Property or Leased Facility other than the
Owned Real Property (in which case the
Purchase Price shall be adjusted accordingly)
and assume the liabilities (other than the
Real Property Lease) associated with the
Owned Real Property or Leased Facility
affected by the Material Defect, and lease
(or sublet in the case of any Leased
Facilities) the real estate and improvements
associated therewith from Seller for a period
of twelve (12) months at their fair market
rental value (or, in the case of a sublease,
Seller's then current rental payments) and on
such other terms as shall be mutually
agreeable to Seller and Buyer and during
which time Buyer may construct or arrange for
another facility in which to operate the
business of the affected Owned Real Property
or Leased Facility;
(y) indemnification of Buyer by Seller;
provided, however, with regard to the Leased
Facilities, Seller would only indemnify and
defend Buyer from any expenses arising out of
a Material Defect set forth in Section
7.3(b)(i)(z), identified by Buyer during the
review period set forth in Section 7.3(b) and
for which timely notice has been given to
Seller, existing on the Leased Facilities on
the date of assignment of the Real Property
Leases to Buyer which is the responsibility
of Seller as lessee under such Real Property
Lease, it being understood that this covenant
would be effective only during the initial
term of Buyer's leasehold interest (excluding
renewals, extensions, and new leases) and
would not extend to liability arising out of
Buyer's acts or omissions, and provided,
further, that Seller's obligation to
indemnify Buyer would not be required to
exceed $250,000 in the aggregate; or
(z) adjustment of the Purchase Price;
provided, however, any such Purchase Price
adjustment would not exceed $250,000 in the
aggregate.
In the event that the parties are unable to
reach a mutually satisfactory resolution, then
Buyer shall have the right in its sole discretion
to terminate the Agreement with respect to such
Branch (including with respect to the Assets and
Liabilities associated with such Branch).
(iii)Lessor Consent to Cure of Material Defect.
With regard to the Leased Facilities, Buyer
and Seller understand that conducting the
inspections and affecting the cure of a Material
Defect, if any, may require the action or the
consent of the lessor. In the event that the
lessor elects not to undertake such action or give
such consent relating to the cure of a Material
Defect, then Buyer may terminate the Agreement
with respect to such Branch (including with
respect to the Assets and Liabilities associated
with such branch).
(c) Access to Seller's Records.
In connection with Buyer's inspections and examinations of the
Owned Real Property and the Leased Facilities, Seller
shall, to the extent of Seller's Access, within fifteen
(15) days of the date of this Agreement, and subject to
the provisions of Section 7.3(d), provide Buyer with
copies of all assessments (including Phase I and Phase
II reports), audits, correspondence, notices, letters,
determinations and plans and the documents relating to
the discharge, or the potential discharge, remediation
or cleanup of Hazardous Material on Owned Real Property
or the Leased Facilities; provided, however, that such
copies shall be provided for informational purposes
only and Seller makes no representations or warranties
with respect to the contents thereof.
(d) Confidentiality of Seller's Records.
No information or the contents of any
environmental audits, nor the results of any
investigation of the Owned Real Property or the Leased
Facilities conducted pursuant to this section,
including, but not limited to, the contents of the
report issued in connection therewith, shall be
disclosed by Buyer or its agents, consultants or
employees to any third party without Seller's prior
written approval, unless and until Buyer is legally
compelled to make such disclosure under applicable laws
or until Buyer completes its purchase of the Owned Real
Property or assumes the Real Property Lease pursuant to
this Agreement. Notwithstanding the foregoing, Buyer
may disclose such matters to its directors, executive
officers, legal counsel and such employees who are
reasonably required to receive such disclosure (such
parties being referred to as "Buyer" for purposes of
this section), the specific identities of whom shall be
supplied to Seller prior to any permitted disclosure to
such party by Buyer. If this Agreement is terminated
for any reason, Buyer shall immediately deliver and/or
return to Seller any and all documents, plans and other
items furnished to Buyer pursuant to this section.
7.4 Closing of Branches.
Prior to the Closing Date, Buyer shall not provide any
notification to customers, regulatory agencies or any other party
as to its intention to close any of the Branches.
VIII. SELLER'S EMPLOYEES
8.1 Transferred Employees.
(a) Buyer will offer to employ all of the Employees
effective as of the Closing Date. Buyer will communicate
offers of employment in accordance with legal requirements
and in a form mutually acceptable to Seller and Buyer. All
such Employees shall be offered employment with Buyer in all
cases (i) in a position requiring comparable skills and
abilities as such Employee's position with Seller on the
Closing Date, (ii) with annual base salary, or weekly or
hourly rate of pay which is equal to such Employee's pay
with Seller on the Closing Date, (iii) at a work location
not more than 30 miles from such Employee's work location
with Seller on the Closing Date, and (iv) with a work
schedule that is not changed by more than 10% from such
Employee's work schedule with Seller on the Closing Date (a
"Comparable Job Offer"). Buyer hereby agrees to pay any
severance benefits to any Employee who is not offered a
Comparable Job Offer and does not otherwise accept
employment with Buyer in accordance with the terms set forth
on Schedule 8.1(a); provided, however, that Buyer shall not
pay severance pay or benefits to any Transferred Employee
who is terminated for cause. Each Employee who accepts
Buyer's offer of employment and commences employment with
Buyer hereunder shall be referred to as a "Transferred
Employee" for purposes of this Agreement. Buyer hereby
agrees to use its reasonable best efforts to cooperate with
Seller in obtaining, in connection with any acceptance of an
offer of employment with Buyer, an executed release from
such Transferred Employee providing that Seller and its
Affiliates shall not be responsible for any severance claims
or obligations for such Transferred Employee with respect to
any severance plan, policy or practices of Seller or any of
its Affiliates or predecessors. With respect to any
Employee who accepts an offer of employment from Buyer who
on the Closing Date is on military leave, sick leave,
maternity leave, short-term disability or other leave of
absence approved by Seller (but excluding any Employee
absent by reason of long-term disability, for whom Seller
will retain all liability), except as required by applicable
law, Buyer need only employ such Employee for the period
beginning after such absence if such Employee returns to
employment in accordance with the terms of such Employee's
leave. Any such Employee will cease employment with Seller
at the end of such leave of absence.
(b) Seller is responsible for the filing of Forms W-2
with the Internal Revenue Service and any required filing
with state tax authorities, with respect to wages and
benefits paid to each Transferred Employee for periods
ending on or prior to the Closing Date.
(c) Seller agrees that, for a period of one (1) year
following the Closing Date, Seller will not employ or
attempt to employ any employee of the Branches not listed in
Schedule 6.3(h) at one of Seller's facilities within fifty
(50) miles of any of the Branches; provided, that Seller
shall not be precluded from hiring any Employee who has been
terminated by Buyer.
8.2 Certain Other Obligations of Buyer.
(a) (i) Following the Closing, Buyer shall not have any
liability or obligation under any Benefit Plans or any other
program or arrangement of Seller or an ERISA Affiliate
thereof under which any current or former employee of Seller
or any of its Affiliates has any right to any benefits;
(ii) Upon the Closing, the participation of
Transferred Employees in the Benefit Plans shall cease in
accordance with the terms of such plans; and
(iii) With respect to the Transferred Employees,
Seller shall be responsible for any welfare benefits or
claims which, by reason of events which take place on or
prior to the Closing Date, become payable under the terms of
any Welfare Benefit Plan. With respect to Transferred
Employees, Buyer shall be responsible for any welfare
benefits or claims which become payable by reason of events
that take place after the Closing Date.
(b) (i) From and after the Closing Date, Buyer shall
provide the Transferred Employees with employee benefit
plans, programs, and arrangements (including a "group health
plan" within the meaning of Section 5000(b)(1) of the Code)
that are no less favorable in the aggregate than the
employee benefit plans, programs, and arrangements generally
provided on the Closing Date to other similarly situated
employees of Buyer; provided, however, that Buyer shall not
pay severance pay or benefits to any Transferred Employee
who is terminated for cause. Subject to the terms and
conditions of such arrangements, such Transferred Employees
will be fully eligible to participate in Buyer's bonus and
other incentive arrangements from the commencement of such
Transferred Employees employment with Buyer to the same
extent as Buyer's similarly situated employees;
(ii) Buyer will grant for purposes of vacation
benefits, severance pay and all welfare benefit plans (as
defined in ERISA) past service credit to all Transferred
Employees for periods of time credited to such Transferred
Employees under the Welfare Benefit Plans. To the extent
that any Transferred Employee has satisfied in whole or in
part any annual deductible under a Welfare Benefit Plan, or
has paid any out-of-pocket expenses pursuant to any Welfare
Benefit Plan co-insurance provision, such amount shall be
counted toward the satisfaction of any applicable deductible
or out-of-pocket expense maximum, respectively, under the
benefit plans and programs provided to Transferred Employees
by Buyer, and such plans and programs shall be applied
without regard to any limitations relating to preexisting
conditions or required physical examinations that would not
otherwise apply under the respective Welfare Benefit Plans
to the extent that such Transferred Employees are covered by
the Welfare Benefit Plans on the Closing Date;
(iii) Buyer shall take whatever action is necessary,
including amendment of its defined contribution pension
plan, to grant to each Transferred Employee past service
credit for all purposes (including any waiting period) under
Buyer's defined contribution pension plan for all periods of
service credited to each such Transferred Employee under the
Seller's defined contribution pension plan. As soon as
reasonably practicable after the Closing Date, Seller shall
provide to Buyer such information as Buyer reasonably
requires to establish the service for the Transferred
Employees credited under the Seller's defined contribution
pension plan;
(iv) As of the Closing Date, Seller will permit participants in
Seller's defined contribution pension plan who become
Transferred Employees to initiate a distribution from
Seller's 401(k) plan;
(v) Buyer shall take whatever action is necessary,
including amendment of its defined benefit pension plan, to
grant to each Transferred Employee past service credit for
service which has been granted under Seller's defined
benefit pension plan, for all purposes, other than benefit
accrual, under Buyer's defined benefit pension plan; and
(vi) Buyer shall provide coverage under Buyer's
severance plan, policies and practices for each Transferred
Employee as of the Closing Date. For a period of twelve
(12) months following the Closing Date any Transferred
Employee who shall be entitled to any such severance shall
receive from Buyer the greater of the benefits under either
Buyer' severance plan, policies and practices or Seller's
current severance plan, policies and practices; provided,
however, that Buyer shall not pay severance to any employee
terminated for cause.
8.3 Training.
Seller shall permit Buyer to train the Transferred Employees
before Closing with regard to Buyer's operations, policies
and procedures at Buyer's sole cost and expense. To the
extent reasonable, and with the mutual agreement of Buyer
and Seller, this training shall take place outside of
business hours and may take place at the Branches
IX. CLOSING AND CONDITIONS TO CLOSING
9.1 Time and Place of Closing.
The Closing shall be on a date mutually agreed upon by
the parties (the "Closing Date"), which shall be on a Friday and
shall be not less than 45 calendar days after the last regulatory
approval necessary for the Closing has been obtained by Buyer
(without regard to any statutory waiting periods following such
approval). Buyer understands and agrees that Seller desires to
effect the Closing on February 9, 2001 and no later than March
30, 2001. The Closing shall take place at Seller's offices
located at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇, at 10:00 a.m. on the Closing Date, or at a time and place
otherwise determined by mutual agreement of the parties.
Alternatively, the Closing may be effectuated through the use of
the mails and by telefax.
9.2 Exchange of Closing Documents.
The parties shall exchange drafts of all documents to
be delivered at the Closing (other than the Closing Statement) at
least ten Business Days prior to the Closing Date.
9.3 Buyer's Conditions to Closing.
Buyer's obligations to purchase the Assets and assume
the Liabilities is contingent upon and subject to the fulfillment
of the following conditions:
(a) the parties obtaining all regulatory approvals
which are required in order for them to proceed with the
transactions contemplated by this Agreement and the
expiration of any required waiting period without the
commencement of adverse proceedings by any governmental
authority with jurisdiction over the transactions
contemplated by this Agreement (No regulatory approval so
obtained which is necessary to consummate the transactions
contemplated hereby shall be conditioned or restricted
(including, without limitation, any requirement for Buyer to
raise additional capital) in a manner which in the
reasonable judgment of the Board of Directors of Buyer would
so materially adversely affect the economic or business
benefits of the transactions contemplated by this Agreement
that, had such condition or requirement been known, such
party would not, in its reasonable judgment, have entered
into this Agreement);
(b) the representations and warranties of Seller in
this Agreement being true and correct as of the Closing Date
(except that representations and warranties as of a
specified date need be true and correct only as of such
date); (provided, however, that for purposes of determining
the satisfaction of the condition contained in this Section
9.3(b), such representations and warranties shall be deemed
to be true and correct if the failure or failures of such
representations and warranties to be so true and correct
(excluding the effect of any qualification set forth therein
relating to "materiality" or "Seller Material Adverse
Effect") do not constitute or give rise to, and are not
reasonably likely to constitute or give rise to,
individually or in the aggregate, a Seller Material Adverse
Effect), and all covenants and conditions of Seller to be
performed or met by Seller on or before the Closing Date
having been performed or met in all material respects (but
without duplication of any standard of materiality set forth
in any such covenant or condition);
(c) Seller's delivery to Buyer of the following
documents in form and substance reasonably satisfactory to
Buyer:
(i) Subject to Section 7.3, special warranty deeds
conveying the Owned Real Property;
(ii) bills of sale, powers of attorney, assignments
and other instruments of transfer sufficient to convey
to Buyer all of Seller's right, title, and interest in
and to the remaining Assets;
(iii) a certificate executed by an appropriate
officer of Seller attesting, to the officer's best
knowledge, to Seller's compliance with the conditions
set forth in Section 9.3(b);
(iv) landlord consents, to the extent required by
the terms of the Real Property Lease, and estoppel
certificates executed by the lessors of the Leased
Facilities, to the extent Seller can obtain such
estoppel certificates using its reasonable efforts and
without the payment of any fees to such lessors in
excess of $500 for each such estoppel certificate;
(v) Seller's resignation as trustee or custodian,
as applicable, with respect to each ▇▇▇ or ▇▇▇▇▇ Plan
account included in the Deposits and designation of
Buyer or its Affiliate as successor trustee or
custodian with respect thereto, as contemplated by
Section 2.9;
(vi) possession of the Branches and the Fixed
Assets subject to Section 6.6 and Section 7.3; and
(vii) FIRPTA Affidavit complying with the
requirements of Section 1445 of the Internal Revenue
Code of 1986, as amended; and
(viii)a Seller's affidavit reasonably acceptable
to Seller and sufficient to delete standard title
exceptions for mechanic's liens and parties in
possession.
(d) Buyer's agreement to receive the Closing Statement
and the Settlement Payment as provided in Section 3.2.
(e) No other Material Defects shall have arisen after
the expiration of the 45 day period set forth in Section
7.3(b)(i)
(f) Such other documents necessary to effect the
transactions contemplated hereby as Buyer shall reasonably
request.
9.4 Seller's Conditions to Closing.
Seller's obligation to sell the Assets and transfer the
Liabilities to Buyer is contingent upon and subject to the
fulfillment of the following conditions:
(a) the parties obtaining all regulatory approvals
which are required in order for them to proceed with the
transactions contemplated by this Agreement and the
expiration of any required waiting period without the
commencement of adverse proceedings by any governmental
authority with jurisdiction over the transactions
contemplated by this Agreement (No regulatory approval so
obtained which is necessary to consummate the transactions
contemplated hereby shall be conditioned or restricted
(including, without limitation, any requirement for Seller
to raise additional capital) in a manner which in the
reasonable judgment of the Board of Directors of Seller
would so materially adversely affect the economic or
business benefits of the transactions contemplated by this
Agreement that, had such condition or requirement been
known, such party would not, in its reasonable judgment,
have entered into this Agreement);
(b) the representations and warranties of Buyer in this
Agreement being true and correct as of the Closing Date
(except that representations and warranties as of a
specified date need be true and correct only as of such
date); (provided, however, that for purposes of determining
the satisfaction of the condition contained in this Section
9.4(b), such representations and warranties shall be deemed
to be true and correct if the failure or failures of such
representations and warranties to be so true and correct
(excluding the effect of any qualification set forth therein
relating to "materiality" or "Buyer Material Adverse
Effect") do not constitute or give rise to, and are not
reasonably likely to constitute or give rise to,
individually or in the aggregate, a Buyer Material Adverse
Effect), and all covenants and conditions of Buyer to be
performed or met by Buyer on or before the Closing Date
having been performed or met in all material respects (but
without duplication of any standard of materiality set forth
in any such covenant or condition);
(c) Buyer's delivery to Seller of the following
documents in form and substance reasonably satisfactory to
Seller:
(i) one or more executed assumptions of the Real
Property Leases;
(ii) one or more executed instruments assuming the
remaining Liabilities; and
(iii) a certificate executed by an appropriate
officer of Buyer attesting, to the officer's best
knowledge, to Buyer's compliance with the conditions
set forth in Section 9.4(b).
9.5 Survival of Representations, Warranties and Covenants.
Unless provided otherwise in this Agreement, Buyer's
and Seller's representations and warranties under this Agreement
or contained in any certificate or instrument delivered by either
party at the Closing shall survive for a period of one year
following the Closing Date. The agreements and covenants
contained in this Agreement shall not survive the Closing except
to the extent expressly set forth in this Agreement; provided
that the agreements and covenants set forth in Section 11.12
shall survive the Closing or any termination of this Agreement.
X. TERMINATION
10.1 Termination by Either Party.
Either party may terminate this Agreement upon written
notice to the other if:
(a) as a result of any material breach of any
representation, warranty or covenant of Seller (in the case
of a termination by Buyer) or of Buyer (in the case of
termination by Seller), the party terminating this Agreement
has given the other party written notice of such breach and
such breach is not cured within 30 days thereafter;
(b) the Closing does not occur within two hundred
seventy (270) days after the date of this Agreement;
provided, however, that Seller may not terminate this
Agreement pursuant to this paragraph (b) to the extent that
the failure of the Closing to occur within such period
arises out of or results from the actions or omissions of
Seller, and that Buyer may not terminate this Agreement
pursuant to this paragraph (b) to the extent that the
failure of the Closing to occur within such period arises
out of or results from the actions or omissions of Buyer; or
(c) the other party so agrees in writing.
The termination of this Agreement under subsection (a)
shall not absolve the breaching party from any liability to the
other party arising out of its breach of this Agreement.
XI. MISCELLANEOUS
11.1 Continuing Cooperation.
(a) On and after the Closing Date, Seller agrees to
execute, acknowledge and deliver such documents and
instruments as Buyer may reasonably request to vest in Buyer
the full legal and equitable title to the Assets and
Liabilities.
(b) On and after the Closing Date, Buyer shall execute,
acknowledge and deliver such documents and instruments as
Seller may reasonably request to relieve and discharge
Seller from its obligations with respect to the Liabilities.
(c) Seller and Buyer shall cooperate with each other in
connection with any examination conducted by any tax
authority subsequent to the Closing Date by promptly
providing upon request information relating to the tax
liability of any business operated by Seller or Buyer with
respect to the Branches and promptly informing the other of
the institution of, any material developments concerning,
and the outcome of, the same.
(d) Except as provided in Section 7.2, no interest in
or right to use First Union National Bank's logo or the name
"First Union" or any other similar word, name, symbol or
device in which Seller has any interest by itself or in
combination with any other word, name, symbol or device, or
any similar variation of any of the foregoing (collectively,
the "Retained Names and Marks") is being transferred to
Buyer pursuant to the transactions contemplated hereby.
Unless permitted pursuant to Section 7.2, Buyer shall not
after the Closing Date in any way knowingly use any
materials or property, whether or not in existence on the
Closing Date, that bear any Retained Name or ▇▇▇▇. Buyer
agrees that Seller shall have no responsibility for claims
by third parties arising out of, or relating to, the use by
the Buyer of any Retained Name or ▇▇▇▇ after the Closing
Date, and Buyer agrees to indemnify and hold harmless Seller
from any and all claims (and all expenses, including
reasonable attorneys' fees and disbursements incurred in
connection with any such claim) that may arise out of the
use thereof by Buyer.
(e) Buyer agrees to provide reasonable assistance and
cooperation, at no expense to Buyer, to Seller and its
Affiliates in activities related to the prosecution or
defense of any pending or future lawsuits, arbitrations,
other proceedings or claims involving the Seller's or its
Affiliates and the Branches ("Seller's Litigation"). In
addition, Buyer shall facilitate, without expense to Buyer,
the reasonable availability to Seller of the Transferred
Employees, without the need for issuance of any subpoena or
similar process, to testify or assist Seller in the Seller's
Litigation.
11.2 Merger and Amendment.
This Agreement sets out the complete agreement of the
parties with respect to the matters discussed in this Agreement,
and it supersedes all prior agreements between the parties,
whether written or oral, which apply to these matters. No
provision of this Agreement may be changed or waived except as
expressly stated in a document executed by both parties.
11.3 Dispute Resolution.
(a) Neither Seller nor Buyer shall assert any claim
arising out of or relating to this Agreement (except with
respect to claims to be handled under the Working Agreement
or submitted to the Mediator under Section 3.2(c)), unless:
(i) except for claims arising under or in respect
of Sections 2.4, 2.5, or 11.1(d), the amount in dispute
with respect to any claim exceeds $5,000;
(ii) except for claims arising in respect of
Sections 2.4, 2.5 or 11.1(d), the aggregate amount of
all claims by Buyer or Seller (as the case may be)
which satisfy the preceding clause exceeds $100,000, in
which case a claim may be asserted only to the extent
that such threshold has been exceeded;
(iii) except for claims arising under Sections
2.4, 2.5, or 11.1(d), the aggregate amount of all
claims by Buyer or Seller (as the case may be) shall
not exceed the Amount of Premium; and
(iv) except for claims arising under Sections 2.4,
2.5 or 11.1(d), the notification required by Section
11.3(b) (if any) is given on or before the first
anniversary of the Closing Date.
(b) The parties shall attempt in good faith to resolve
any dispute arising out of or relating to this Agreement
promptly by negotiations, as provided in this subsection
(b). Either party shall give the other party written notice
of any dispute not resolved in the normal course of
business. Executives of both parties at comparable levels
at least one step above the personnel who have previously
been involved in the dispute shall meet at a mutually
acceptable time and place within ten days after delivery of
such notice, and thereafter as often as they reasonably deem
necessary, to exchange relevant information and to attempt
to resolve the dispute. If the matter has not been resolved
by these persons within 30 days of the disputing party's
notice, or if the parties fail to meet within ten days, the
dispute shall be referred to more senior executives of both
parties who have authority to settle the dispute and who
shall likewise meet to attempt to resolve the dispute. All
negotiations under this subsection (b) are confidential and
shall be treated as compromise and settlement negotiations
for purposes of the Federal Rules of Evidence, applicable
state rules of evidence, and common law. The procedures set
forth above will be followed in advance of litigation of any
dispute between the parties; nevertheless, either party may
seek a preliminary injunction or other provisional judicial
relief if in its judgment such an action is necessary to
avoid irreparable damage or to preserve the status quo.
Despite any such action, the parties will continue to
participate in good faith in the procedures set forth in
this subsection (b).
(c) Neither party shall have any liability for lost
profits or punitive damages with respect to any claim
arising out of or relating to this Agreement. The sole
recourse and remedy of a party hereto for breach of this
Agreement by the other party hereto shall be against such
other party and its assets, and no officer, director,
employee, stockholder or affiliate of any party shall be
liable at law or in equity for the breach by such party of
any of its obligations under this Agreement.
11.4 Indemnification.
After the Closing Date, and unless otherwise provided
in the Agreement:
(a) Except as otherwise provided in this Agreement,
Buyer shall indemnify, hold harmless and defend Seller, its
Affiliates, and their respective officers, directors, agents
and employees (collectively, the "Seller Group") from and
against all claims, losses, liabilities, demands and
obligations (including reasonable legal fees, consultant
fees, and expenses) which any of the Seller Group shall
receive, suffer or incur arising out of or resulting from
(a) transactions or operations of the Branches after the
Closing Date, and/or (b) the breach of any representation,
warranty or covenant made by Buyer in and/or pursuant to
this Agreement.
If any claim or lawsuit is made or commenced as to
which Seller proposes to demand such indemnification, it
shall notify Buyer with reasonable promptness; provided,
however, that any failure by Seller to notify Buyer shall
not relieve Buyer from its obligations hereunder, except to
the extent that Buyer is actually prejudiced by such failure
to give notice. Buyer shall have the option of defending
such claim or lawsuit with counsel of its own choosing at
its own cost and expense and such counsel shall, to the
extent consistent with its professional responsibilities,
cooperate with Seller and any counsel designated by Seller
(in such event, the counsel designated by Seller shall be at
Seller's own cost and expense). Buyer shall be liable for
any settlement of any claim or lawsuit against Seller made
with Buyer's written consent, which consent shall not be
unreasonably withheld.
(b) Except as otherwise provided in this Agreement,
Seller shall indemnify, hold harmless and defend Buyer, its
Affiliates, and their respective officers, directors, agents
and employees (collectively, the Buyer Group") from and
against all claims, losses, liabilities, demands and
obligations (including reasonable legal fees, consultant
fees, and expenses) which any of the Buyer Group shall
receive, suffer or incur arising out of or resulting from
(a) any liability of Seller not assumed by Buyer hereunder,
and/or (b) the breach of any representation, warranty or
covenant made by Seller in and/or pursuant to this
Agreement. If any claim or lawsuit is made or commenced as
to which Buyer proposes to demand such indemnification, it
shall notify Seller with reasonable promptness; provided,
however, that any failure by Buyer to notify Seller shall
not relieve Seller from its obligations hereunder, except to
the extent the Seller is actually prejudiced by such failure
to give notice. Seller shall have the option of defending
such claim or lawsuit with counsel of its own choosing at
its own cost and expense and such counsel shall, to the
extent consistent with its professional responsibilities,
cooperate with Buyer and any counsel designated by Buyer (in
such event the counsel designated by Buyer shall be at
Buyer's own cost and expense). Seller shall be liable for
any settlement of any claim or lawsuit against Buyer made
with Seller's written consent, which consent shall not be
unreasonably withheld.
(c) Any claims for indemnification brought under this
Section shall be subject to the provisions of Section 11.3.
11.5 Counterparts.
This Agreement may be executed in any number of
counterparts, each of which will constitute an original, but all
of which taken together shall constitute one and the same
instrument.
11.6 Exhibits and Schedules.
All exhibits and schedules referred to in this
Agreement shall constitute a part of this Agreement.
11.7 Assignment.
This Agreement is not assignable by either party;
provided, however, that this Agreement may be assigned to an
Affiliate of either party with the written consent of the other
party, which shall not be unreasonably withheld.
11.8 Headings.
The headings contained in this Agreement are inserted
for convenience only and shall not affect the meaning of this
Agreement or any of its provisions.
11.9 Notices.
Any notice under this Agreement shall be made in
writing and shall be deemed given when delivered in person, when
delivered by first class mail postage prepaid (in which case the
notice shall be deemed given on the third Business Day following
the date on which the notice is postmarked), or when delivered by
facsimile transmission, which transmission also shall be sent by
first class mail, postage prepaid before the second Business Day
following the transmission (in which case the notice shall be
deemed given on the day transmitted if transmitted before or
during normal business hours or, otherwise, on the next
succeeding Business Day) to the parties at the respective
addresses set forth below or at such other addresses as each
party shall inform the other in writing.
If to Seller to: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Senior Vice president
First Union National Bank
▇▇▇▇ ▇▇▇▇ ▇.▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Executive Vice President
and General Counsel
First Union Corporation
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
If to Buyer to: ▇. ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Capital City Bank
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
Gunster, Yoakley & ▇▇▇▇▇▇▇, P.A.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
11.10 Expenses.
Unless specifically stated to the contrary in this
Agreement, each party will assume and pay for the expenses it
incurs with respect to the purchase and sale of the Assets and
assumption of the Liabilities under this Agreement; provided,
however, that Buyer shall pay all fees and expenses associated
with Buyer's regulatory application process. Each party shall be
responsible for any fee payable to any agent, broker or finder
acting on its behalf in this transaction.
11.11 Communications.
During the period from the date of this Agreement to the
Closing Date, Buyer and Seller shall not communicate with the
Employees, depositors, or customers of the Branches, except as
specifically required by the relevant regulatory agencies as part
of the approval process, or as specifically provided for herein:
(a) As soon as practicable following the date of this
Agreement, Seller and Buyer shall jointly communicate, at Buyer's
and Seller's equal expense, with the Employees, depositors or
customers of the Branches advising them of the transactions
contemplated by this Agreement. Such communication shall be in
form and substance mutually satisfactory to the parties hereto
and to any regulatory authorities as may be required by
applicable law or regulation. Any and all public announcements
or press releases by either party must comply with Section 11.12
of this Agreement.
(b) With the exception of the communications provided for in
paragraph (a) above, and in Section 8.1 (to the extent necessary
to convey an offer of employment), Buyer may not communicate with
the Employees, depositors and other customers of the Branches
without the prior consent of Seller. Any such permitted
communications may not interrupt or interfere with the normal
operations of the Branches, and shall be at Buyer's sole cost and
expense. Notwithstanding anything to the contrary in the
foregoing, Buyer and Seller agree that it is in their mutual best
interest to facilitate Buyer's written and/or oral communications
with the Employees regarding the transactions contemplated in
this Agreement; Seller, therefore, will use its reasonable best
efforts to consent to Buyer's communications with employees as
soon as practicable after Buyer's request, and, after granting
such consent, Seller shall use its reasonable best efforts to
facilitate Buyer's written and/or oral communications with the
Employees.
(c) In addition to the communications provided for in paragraph
(a) above, with regard to Seller's communications specific to the
Branches and related to the transactions contemplated by this
Agreement, Seller at its own cost and expense may communicate,
upon the prior consent of Buyer (and after Buyer has received a
copy of any communications which are in writing), where such
consent shall be presumed if Buyer has not objected to such
communication within 24 hours after receiving notice, with the
Employees, depositors and other customers of the Branches at such
times and in such form as deemed appropriate by Seller; provided,
that no such communication shall recommend any actions by any
person that shall be in contravention with the terms of this
Agreement or reflect adversely upon Buyer.
11.12 Public Announcements.
Each party shall consult with the other before making
any announcement or other public communication with respect to
the transactions contemplated by this Agreement and, prior to
such announcement or other public communication, shall mutually
agree upon the substance and timing thereof.
11.13 Governing Law; Jurisdiction.
This Agreement and the legal relations between the parties
shall be governed by and construed in accordance with the laws of
the State of Florida applicable to contracts made and to be
performed entirely within the State of Florida; provided,
however, that with respect to issues arising from or relating to
the Owned Real Property, governing law is the law of the situs of
the respective Owned Real Property.
11.14 No Third Party Beneficiaries.
The parties intend that this Agreement shall not
benefit or create any right or cause of action in or on behalf of
any Person other than Seller and Buyer.
11.15 Brokers-Finders.
(a) Buyer hereby represents and warrants to Seller that it
has not employed or agreed to retain any broker or finder in
connection with the transactions contemplated by this Agreement,
and Buyer agrees to indemnify Seller against any claim arising
out of any such employment of or agreement to retain any such
broker or finder by Buyer.
(b) Seller hereby represents and warrants to Buyer that it
has not employed or agreed to retain any broker or finder in
connection with the transactions contemplated by this Agreement,
and Seller agrees to indemnify Buyer against any claim arising
out of any such employment of or agreement to retain any such
broker or finder by Seller.
IN WITNESS WHEREOF, each of the parties to this Agreement
has caused this Agreement to be executed by a duly authorized
officer as of the date written on page one of this Agreement.
CAPITAL CITY BANK
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇.
Its: Chairman
FIRST UNION NATIONAL BANK
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, III
Its: Senior Vice President
EXHIBITS
--------
A Working Agreement
B Closing Statement
C Adjusted Closing Statement
SCHEDULES
---------
1.1a Branches and ATM Service Facilities
1.1(d) GA Consumer Loans with Credit Life Insurance
1.1(c) GA Fixed Assets
4.4(g) and 4.13 Waynesboro Main Branch - Lease
6.3(h) Employee Movement as of 10/02/2000
8.1 GA - HR Employee List
Copies of the above exhibits and schedules will be provided to the
Securities and Exchange Commission upon request.
WPB/Word/563395.1