Exhibit 99.1
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AGREEMENT AND PLAN OF MERGER
dated as of September 15, 1999
between
▇▇▇▇▇▇ UNITED BANCORP
and
DIME BANCORP, INC.
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TABLE OF CONTENTS
PAGE
RECITALS......................................................................1
A. Dime ..............................................................1
▇. ▇▇▇▇▇▇ ..............................................................1
C. The Merger ..............................................................1
D. Stock Option Agreements...................................................1
E. Intention of the Parties..................................................2
F. Approvals ..............................................................2
G. Subsidiary Bank...........................................................2
ARTICLE I
THE MERGER; EFFECTIVE TIME; CLOSING
1.1 The Merger ..............................................................2
1.2 Effective Time...........................................................2
1.3 Closing ..............................................................3
ARTICLE II
GOVERNING DOCUMENTS OF THE
SURVIVING CORPORATION
2.1 Certificate of Incorporation of the Surviving Corporation................3
2.2 By-laws of the Surviving Corporation.....................................3
ARTICLE III
CORPORATE GOVERNANCE OF THE
SURVIVING CORPORATION
3.1 Survival of Article III..................................................4
3.2 Board of Directors of Surviving Corporation..............................4
(a) Composition ............................................................4
(b) Certain Members of the Board of Directors................................4
(c) Nomination of Directors..................................................4
(d) Committees of the Board of Directors.....................................5
3.3 Officers of the Surviving Corporation....................................5
(a) Composition ............................................................5
(b) Succession ............................................................5
(c) Employment Agreements....................................................5
3.4 Modifications to Corporate Governance Provisions.........................6
3.5 Certificate and By-laws..................................................6
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3.6 Adjustment...............................................................6
ARTICLE IV
CONVERSION OR CANCELLATION AND EXCHANGE OF SHARES
4.1 Conversion or Cancellation of Shares.....................................7
4.2 Exchange of Old Certificates for New Certificates. .....................8
(a) Appointment of Exchange Agent............................................8
(b) Exchange Procedures......................................................8
(c) Fractional Shares........................................................9
(d) Transfers ............................................................9
(e) No Liability ...........................................................10
4.3 ▇▇▇▇▇▇ Options and Warrants.............................................10
4.4 Dime Options and Warrants...............................................10
ARTICLE V
REPRESENTATIONS AND WARRANTIES
5.1 Disclosure Schedules....................................................11
5.2 Standard .............................................................12
5.3 Representations and Warranties of Dime and ▇▇▇▇▇▇.......................12
(a) Recitals True...........................................................12
(b) Corporate Organization and Qualification................................12
(c) Subsidiaries ...........................................................12
(d) Capital Stock...........................................................13
(e) Corporate Authority.....................................................14
(f) Governmental Filings; No Violations.....................................15
(g) Reports and Financial Statements........................................16
(h) Asset Classification....................................................18
(i) Absence of Certain Events and Changes...................................18
(j) Properties ...........................................................18
(k) Compliance with Laws....................................................18
(l) Litigation ...........................................................19
(m) Taxes ...........................................................20
(n) Insurance ...........................................................21
(o) Labor Matters...........................................................21
(p) Employee Benefits.......................................................21
(q) Environmental Matters...................................................23
(r) Risk Management Instruments.............................................25
(s) Material Agreements.....................................................26
(t) Knowledge as to Conditions..............................................26
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Page
(u) Year 2000 Compliance....................................................26
(v) Brokers and Finders.....................................................27
ARTICLE VI
COVENANTS
6.1 Conduct of Business Pending the Effective Time..........................27
6.2 Dividends .............................................................30
6.3 Acquisition Proposals...................................................30
6.4 Stockholder Approvals; Election of Directors............................30
6.5 Filings; Other Actions..................................................31
6.6 Information Supplied....................................................32
6.7 Accountants' Letters....................................................32
6.8 Access .............................................................33
6.9 Notification of Certain Matters.........................................33
6.10 Publicity .............................................................34
6.11 Benefit Plans..........................................................34
6.12 Expenses .............................................................34
6.13 Indemnification; Directors' and Officers' Insurance....................35
6.14 Antitakeover Provisions................................................36
6.15 Affiliate Agreements...................................................36
6.16 Stock Exchange Listing.................................................37
6.17 Efforts to Consummate..................................................37
6.18 Reports .............................................................37
6.19 Accounting and Tax Treatment...........................................37
6.20 Assumptions............................................................37
6.21 Bank Combination and Governance........................................37
ARTICLE VII
CONDITIONS
7.1 Conditions to Each Party's Obligation to Effect the Merger..............38
(a) Stockholder Approval....................................................38
(b) Governmental and Regulatory Consents....................................38
(c) Third Party Consents....................................................38
(d) Litigation ...........................................................39
(e) Registration Statement..................................................39
(f) Listing ...........................................................39
(g) Accountants' Pooling Letter.............................................39
(h) Employment Agreements...................................................39
7.2 Conditions to Obligation of ▇▇▇▇▇▇......................................39
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(a) Representations and Warranties..........................................39
(b) Performance of Obligations of Dime......................................40
(c) Opinion of Counsel......................................................40
(d) Opinion of Tax Counsel..................................................40
(e) Accountants' Letters....................................................40
7.3 Conditions to Obligation of Dime........................................40
(a) Representations and Warranties..........................................40
(b) Performance of Obligations of ▇▇▇▇▇▇....................................40
(c) Opinion of Tax Counsel..................................................41
(d) Accountants' Letters....................................................41
ARTICLE VIII
TERMINATION
8.1 Termination by Mutual Consent...........................................41
8.2 Termination by Either Dime or ▇▇▇▇▇▇....................................41
8.3 Termination by ▇▇▇▇▇▇...................................................41
8.4 Termination by Dime.....................................................42
8.5 Effect of Termination and Abandonment...................................42
ARTICLE IX
MISCELLANEOUS
9.1 Survival .............................................................42
9.2 Modification or Amendment...............................................42
9.3 Waiver of Conditions....................................................43
9.4 Counterparts and Facsimile..............................................43
9.5 Governing Law...........................................................43
9.6 Notices .............................................................43
9.7 Entire Agreement, Etc...................................................44
9.8 Definition of "subsidiary"; Covenants with Respect to Subsidiaries......45
9.9 Captions .............................................................45
9.10 Severability...........................................................45
9.11 No Third Party Beneficiaries...........................................45
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ANNEXES
1. Form of Amendments to Certificate of Incorporation
2. Form of Amendments to By-laws
3. Understanding regarding Committees of Board of Surviving
Corporation
4(a). Form of ▇▇▇▇▇▇ Affiliate Agreement
4(b). Form of Dime Affiliate Agreement
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INDEX OF DEFINED TERMS
LOCATION OF
TERM DEFINITION
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Acquisition Proposal.................................................6.3
Affiliates...........................................................6.15
Agreement............................................................Preamble
Antitakeover Provisions..............................................6.14
Asset Classification.................................................5.3(h)
BHCA.................................................................Recital B
Business.............................................................5.3(q)(1)
By-laws..............................................................2.2
Certificate of Incorporation.........................................2.1
Certificates of Merger...............................................1.2(a)
Closing..............................................................1.3
Closing Date.........................................................1.3
Compensation Plans...................................................5.3(p)(1)
Confidentiality Agreements...........................................6.8
Continuing Directors.................................................3.2(c)(2)
Contracts............................................................5.3(f)(2)
Costs................................................................6.13
DGCL.................................................................1.1
Dime.................................................................Preamble
Dime Common Stock....................................................Recital A
Dime Meeting.........................................................6.4
Dime Option..........................................................4.4
Dime Preferred Stock.................................................Recital A
Dime Stock Option Agreement..........................................Recital D
Dime Stock Plans.....................................................5.3(d)(1)
Disclosure Schedule..................................................5.1
Effective Time.......................................................1.2(a)
Employees............................................................5.3(p)(1)
Employment Agreement.................................................3.3(c)
Environmental Law....................................................5.3(q)(1)
ERISA................................................................5.3(p)(1)
ERISA Affiliate......................................................5.3(p)(4)
Exception Shares.....................................................4.1(b)
Exchange Act.........................................................5.3(f)(1)
Exchange Agent.......................................................4.2(a)
Exchange Ratio.......................................................4.1(a)
FDIA.................................................................5.3(c)
FDIC.................................................................5.3(g)(1)
Federal Reserve......................................................5.3(k)(3)
FHLB.................................................................5.3(g)(1)
Financial Statements.................................................5.3(g)(4)
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Former Dime Directors................................................3.2(a)
Former ▇▇▇▇▇▇ Directors..............................................3.2(a)
Former ▇▇▇▇▇▇ Employees..............................................6.11(a)
Former Dime Employees................................................6.11(a)
Governmental Entity..................................................5.3(f)(1)
Hazardous Substances.................................................5.3(q)(1)
HOLA.................................................................Recital A
▇▇▇▇▇▇...............................................................Preamble
▇▇▇▇▇▇ Common Stock..................................................Recital B
Hudson Meeting.......................................................6.4
▇▇▇▇▇▇ Option........................................................4.3
▇▇▇▇▇▇ Preferred Stock...............................................Recital B
▇▇▇▇▇▇ Stock Option Agreement........................................Recital ▇
▇▇▇▇▇▇ Stock Plans...................................................5.3(d)(2)
Indemnified Parties..................................................6.13
Internal Revenue Code................................................Recital E
Joint Proxy Statement................................................6.5
Liens................................................................5.3(d)(1)
Material Adverse Effect..............................................5.1(b)
Merger...............................................................Recital C
Minimum Equity Contribution..........................................3.6
NASD.................................................................5.3(f)
New Certificate......................................................4.1(d)
NJBCA................................................................1.1
Nominating Committee.................................................3.2(c)(1)
NYSE.................................................................5.3(f)
Old Certificate......................................................4.1(d)
OTS..................................................................5.3(g)(1)
PCBs.................................................................5.3(q)(1)
Pending Transactions.................................................5.3(t)(2)
Pension Plan.........................................................5.3(p)(3)
Person...............................................................6.1(c)
Plans................................................................5.3(p)(3)
Previously Disclosed.................................................5.1(c)
Registration Statement...............................................6.5
Reports..............................................................5.3(g)(2)
Representatives......................................................6.8
SEC..................................................................5.3(g)(1)
Securities Act.......................................................5.3(f)(1)
Securities Laws......................................................5.3(g)(2)
Special Majority.....................................................3.3(b)
Stock Option Agreements..............................................Recital D
Subject Property.....................................................5.3(q)(1)
subsidiary...........................................................9.8(a)
Subsidiary Bank......................................................Recital G
Surviving Corporation................................................Recital C
Surviving Corporation Common Stock...................................4.1(a)
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Tax..................................................................5.3(m)
Termination Date.....................................................3.1
Year 2000 Compliant..................................................5.3(u)(3)
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AGREEMENT AND PLAN OF MERGER, dated as of September 15, 1999 (this
"Agreement"), between ▇▇▇▇▇▇ United Bancorp ("▇▇▇▇▇▇") and Dime Bancorp, Inc.
("Dime").
RECITALS
A. Dime. Dime has been duly incorporated and is an existing corporation
in good standing under the laws of the State of Delaware, with its principal
executive offices located in New York, New York. As of the date hereof, Dime has
350 million authorized shares of common stock, par value $0.01 per share ("Dime
Common Stock"), of which not more than 111,918,002 shares were outstanding as of
August 31, 1999, and 40 million authorized shares of preferred stock, par value
$0.01 per share ("Dime Preferred Stock"), none of which is outstanding as of the
date hereof (no other class or series of capital stock being authorized). Dime
is a savings and loan holding company registered under the Home Owners' Loan Act
of 1933, as amended ("HOLA").
▇. ▇▇▇▇▇▇. ▇▇▇▇▇▇ has been duly incorporated and is an existing
corporation in good standing under the laws of the State of New Jersey, with its
principal executive offices located in Mahwah, New Jersey. As of the date
hereof, ▇▇▇▇▇▇ has 100 million authorized shares of common stock, no par value
("▇▇▇▇▇▇ Common Stock"), of which not more than 40,899,905 shares are
outstanding as of the date hereof, and 25 million authorized shares of preferred
stock, no par value ("▇▇▇▇▇▇ Preferred Stock"), none of which is outstanding as
of the date hereof (no other class or series of capital stock being authorized).
▇▇▇▇▇▇ is a bank holding company registered under the Bank Holding Company Act
of 1956, as amended (the "BHCA").
C. The Merger. At the Effective Time (as defined in Section 1.2), the
parties to this Agreement intend to effect the merger (the "Merger") of ▇▇▇▇▇▇
with and into Dime, with Dime the surviving corporation of the Merger. At and
after the Effective Time, Dime, as the surviving corporation in the Merger, is
referred to herein as the "Surviving Corporation". The name of the Surviving
Corporation shall be "Dime United Bancorp, Inc."
D. Stock Option Agreements. As an inducement to and condition of
▇▇▇▇▇▇'▇ willingness to enter into this Agreement and the ▇▇▇▇▇▇ Stock Option
Agreement (as defined in the following sentence), Dime will grant to ▇▇▇▇▇▇ an
option pursuant to a Stock Option Agreement (the "Dime Stock Option Agreement").
As an inducement to and condition of Dime's willingness to enter into this
Agreement and the Dime Stock Option Agreement, ▇▇▇▇▇▇ will grant to Dime an
option pursuant to a Stock Option Agreement (the "▇▇▇▇▇▇ Stock Option Agreement"
and, together with the Dime Stock Option Agreement, the "Stock Option
Agreements"). The Stock Option Agreements will be entered into immediately
following the execution and delivery hereof.
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E. Intention of the Parties. It is the intention of the parties to this
Agreement that the Merger (a) shall be accounted for as a "pooling of interests"
under generally accepted accounting principles and (b) shall qualify as a tax
free reorganization under Section 368(a) of the Internal Revenue Code of 1986,
as amended (the "Internal Revenue Code").
F. Approvals. The Boards of Directors of Dime and ▇▇▇▇▇▇ (at meetings
duly called and held) have determined that this Agreement and the transactions
contemplated hereby are in the best interests of Dime and ▇▇▇▇▇▇, respectively,
and their respective stockholders and have approved this Agreement and the Stock
Option Agreements.
G. Subsidiary Bank. It is the intention of the parties that the
Surviving Corporation shall be a bank holding company registered pursuant to the
BHCA and that the operation of the federal savings bank subsidiary of Dime and
the New Jersey state-chartered commercial bank subsidiary of ▇▇▇▇▇▇ shall be
combined, in a manner to be determined, so that the primary depository
institution subsidiary of the Surviving Corporation is a New Jersey
state-chartered commercial bank (the "Subsidiary Bank"). It is the intention of
the parties that the Board of Directors of the Surviving Corporation and the
Board of Directors of the Subsidiary Bank shall be the same, until otherwise
modified, and that the charter and by-laws of the Subsidiary Bank shall contain
those provisions (or other provisions of similar effect) discussed in Article
III hereof with respect to the Surviving Corporation.
NOW, THEREFORE, in consideration of the premises, and of the
representations, warranties, covenants and agreements set forth herein, the
parties hereto agree as follows:
ARTICLE I
THE MERGER; EFFECTIVE TIME; CLOSING
1.1 The Merger. On the terms, and subject to the conditions, of this
Agreement, at the Effective Time, ▇▇▇▇▇▇ shall merge with and into Dime, and the
separate corporate existence of ▇▇▇▇▇▇ shall thereupon cease. The Surviving
Corporation shall continue to be governed by the laws of the State of Delaware.
The Merger shall have the effects specified in the Delaware General Corporation
Law (the "DGCL") and the New Jersey Business Corporation Act (the "NJBCA").
1.2 Effective Time. (a) Subject to the conditions of this Agreement,
the parties to this Agreement will cause certificates of merger to be executed,
acknowledged and filed with the Secretary of State of the State of Delaware as
provided in Section 252 of the DGCL, and executed, acknowledged and filed with
the Secretary of State of the State of New Jersey as provided in
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Sections 14A: 10-7 and 14A: 10-4.1 of the NJBCA (collectively, the "Certificates
of Merger"). The Merger shall become effective at such time as a Certificate of
Merger has been filed with the Secretary of State of the State of Delaware in
accordance with the provisions of Section 252 of the DGCL and a Certificate of
Merger has been filed with the Secretary of State of the State of New Jersey in
accordance with the provisions of Sections 14A: 10-7 and 14A: 10-4.1 of the
NJBCA, or at such other time as may be specified in the Certificates of Merger
in accordance with applicable law. The date and time when the Merger shall
become effective is herein referred to as the "Effective Time".
(b) Dime and ▇▇▇▇▇▇ each will use reasonable efforts to cause the
Effective Time to occur on the fifth business day after the date of satisfaction
or waiver of the last of the conditions specified in Sections 7.1(a) and (b) of
this Agreement has occurred. Notwithstanding anything to the contrary in this
Section 1.2, Dime and ▇▇▇▇▇▇ may cause the Effective Time to occur on such
earlier or later day following the satisfaction or waiver of such conditions as
they may agree in writing, consistent with the provisions of the DGCL, the NJBCA
and other applicable law.
1.3 Closing. The closing of the Merger (the "Closing") shall take place
at the offices of ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, New York, New York, at 10:00 a.m. on the
date when the Effective Time is to occur or at such other place or time as Dime
and ▇▇▇▇▇▇ shall agree. The date upon which the Closing shall occur is herein
referred to as the "Closing Date".
ARTICLE II
GOVERNING DOCUMENTS OF THE
SURVIVING CORPORATION
2.1 Certificate of Incorporation of the Surviving Corporation. At the
Effective Time, the certificate of incorporation of Dime, as then in effect,
shall by virtue of the Merger be amended as set forth in Annex 1; such
certificate of incorporation, as so amended, shall be the certificate of
incorporation of the Surviving Corporation (the "Certificate of Incorporation"),
until duly amended in accordance with the terms thereof and the DGCL.
2.2 By-laws of the Surviving Corporation. At the Effective Time, the
by-laws of Dime, as then in effect, shall by virtue of the Merger be amended as
set forth in Annex 2, and such by-laws, as so amended, shall be the by-laws of
the Surviving Corporation (the "By-laws"), until duly amended in accordance with
the terms thereof, the Certificate of Incorporation and the DGCL.
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ARTICLE III
CORPORATE GOVERNANCE OF THE
SURVIVING CORPORATION
3.1 Survival of Article III. Notwithstanding any other provision in
this Agreement, the provisions of this Article III shall survive the Effective
Time and remain continuously in effect until December 31, 2002 (the "Termination
Date"), on which date the provisions of this Article III shall terminate. This
Section 3.1 shall not affect the term of any Employment Agreements referred to
in this Article III.
3.2 Board of Directors of Surviving Corporation.
(a) Composition. The Board of Directors will consist of 25 members, 13
of whom shall be designated by Dime ("Former Dime Directors") and 12 of whom
shall be designated by ▇▇▇▇▇▇ ("Former ▇▇▇▇▇▇ Directors"), in each case, such
designation to occur prior to the Closing Date. Dime will designate four
directors, five directors and four directors to classes one, two and three,
respectively, of directors of the Surviving Corporation and ▇▇▇▇▇▇ will
designate four directors to each of the three classes of directors of the
Surviving Corporation.
(b) Certain Members of the Board of Directors. The current Chairman and
Chief Executive Officer of Dime, ▇▇. ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇, will be a member of the
Board of Directors and will serve as its Chairman. The current Chairman and
Chief Executive Officer of ▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, will be a member of
the Board of Directors.
(c) Nomination of Directors. (1) Nominees to the Board of Directors
will be recommended to the Board of Directors by a Nominating Committee (A) for
election to the Board of Directors at the stockholder meetings at which
directors are to be elected and (B) to fill vacancies on the Board of Directors
in between such stockholder meetings (a "Nominating Committee"). For any
position on the Board of Directors occupied, or vacated, as the case may be, by
a Former Dime Director, the Nominating Committee shall consist of two Former
Dime Directors and one Former ▇▇▇▇▇▇ Director; for any position on the Board of
Directors occupied, or vacated, as the case may be, by a Former ▇▇▇▇▇▇ Director,
the Nominating Committee shall consist of two Former ▇▇▇▇▇▇ Directors and one
Former Dime Director. A nominee shall need a two-thirds vote of the Nominating
Committee to be recommended for a position on the Board of Directors. Former
Dime Directors on the Nominating Committee will be appointed at the
recommendation of ▇▇. ▇▇▇▇; Former ▇▇▇▇▇▇ Directors on the Nominating Committee
will be appointed at the recommendation of ▇▇. ▇▇▇▇▇▇▇; provided, that, should
▇▇. ▇▇▇▇ or ▇▇. ▇▇▇▇▇▇▇ be otherwise unable to appoint such members of the
Nominating Committee, the Former Dime Directors will be appointed at the
recommendation of the
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most senior Former Dime Director then on the Board of Directors and the Former
▇▇▇▇▇▇ Directors will be appointed at the recommendation of the most senior
Former ▇▇▇▇▇▇ Director then on the Board of Directors.
(2) Any person filling a membership position on the Board of Directors
previously occupied or vacated by a Former Dime Director and nominated in
accordance with the previous paragraph shall be considered a "Former Dime
Director"; any person filling a membership position on the Board of Directors
previously occupied or vacated by a Former ▇▇▇▇▇▇ Director and nominated in
accordance with the previous paragraph shall be considered a "Former ▇▇▇▇▇▇
Director." Any person who (A) was a Former Dime Director or Former ▇▇▇▇▇▇
Director immediately prior to the Effective Time or (B) has become a Former Dime
Director or Former ▇▇▇▇▇▇ Director in accordance with the previous sentence,
shall be a "Continuing Director".
(d) Committees of the Board of Directors. Annex 3 to this Agreement
sets forth certain agreements of the parties with regard to committees of the
Board of Directors and their composition.
3.3 Officers of the Surviving Corporation.
(a) Composition. In addition to serving as Chairman of the Board of
Directors, ▇▇. ▇▇▇▇ shall be Chief Executive Officer of the Surviving
Corporation as of the Effective Time. ▇▇. ▇▇▇▇▇▇▇ shall be President and Chief
Operating Officer of the Surviving Corporation as of the Effective Time. Both
▇▇. ▇▇▇▇ and ▇▇. ▇▇▇▇▇▇▇ shall serve in the positions described in this Section
3.3(a) until the Termination Date or until otherwise determined in accordance
with this Section 3.3.
(b) Succession. On the Termination Date or such earlier date (if any)
that ▇▇. ▇▇▇▇ shall cease to serve as the Chairman of the Board of Directors,
Chairman of the Executive Committee of the Board of Directors and Chief
Executive Officer of the Surviving Corporation, ▇▇. ▇▇▇▇▇▇▇ shall succeed ▇▇.
▇▇▇▇ in those positions, provided that such succession shall not occur if the
Board of Directors, by a Special Majority (as defined below), shall decide to
the contrary. A "Special Majority" shall mean a majority of the directors
voting, provided that a Special Majority shall also require the vote of at least
16 Continuing Directors, unless the number of Continuing Directors at such time
is less than 25, in which case a Special Majority shall require a vote of at
least that number of Continuing Directors equal to the then existing number of
Former Dime Directors plus three (3) (or if there are less than three Former
▇▇▇▇▇▇ Directors at such time, then plus that number of remaining Former ▇▇▇▇▇▇
Directors).
(c) Employment Agreements. Dime or its depository institution
subsidiary has entered into an employment agreement with ▇▇. ▇▇▇▇ (this
agreement, or any successor agreement, an "Employment Agreement") and
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▇▇▇▇▇▇ has entered into an employment agreement (concurrently with or
immediately prior to entering into this Agreement) with ▇▇. ▇▇▇▇▇▇▇ (also an
"Employment Agreement"), each of which will be assumed by the Surviving
Corporation. During the terms of their respective Employment Agreements, ▇▇.
▇▇▇▇ and ▇▇. ▇▇▇▇▇▇▇ shall have the respective powers, and perform the
respective duties, set forth in each of their respective Employment Agreements,
along with the duties of their offices as described in this Article III and the
Certificate of Incorporation or By-laws.
3.4 Modifications to Corporate Governance Provisions. (a) The
Certificate of Incorporation or By-laws will provide that, until the Termination
Date, the following actions will require the approval of a Special Majority:
(1) the removal of either ▇▇. ▇▇▇▇ or ▇▇. ▇▇▇▇▇▇▇ from any of his
executive positions, including by modification of the succession arrange-
ments described above, or undertaking any action to make a material
modification or amendment to or to breach the Employment Agreements;
(2) any change in the size of the Board of Directors or number of
directors to be Former Dime Directors or the number of directors to be
Former ▇▇▇▇▇▇ Directors; and
(3) any change or amendment to the Certificate of Incorporation or
By-laws relating to or affecting the arrangements discussed in this Article
III.
(b) The Certificate of Incorporation or By-laws of the Surviving
Corporation shall also provide that any officer or other person acting on behalf
of the Surviving Corporation in its capacity as sole shareholder of the
Subsidiary Bank may not make any changes or amendment to the by-laws or charter
of the Subsidiary Bank relating to or altering those provisions mirroring the
provisions discussed in this Article III, without the vote of a Special
Majority.
3.5 Certificate and By-laws. As contemplated by Sections 2.1 and 2.2,
the Certificate of Incorporation and By-laws will contain appropriate provisions
giving effect to Sections 3.1 through 3.4.
3.6 Adjustment. Notwithstanding anything in this Article III or this
Agreement to the contrary, if, at the Effective Time of the Merger, ▇▇▇▇▇▇ shall
not have satisfied the Minimum Equity Contribution, then (a) the number of
Former ▇▇▇▇▇▇ Directors at the Effective Time shall be reduced by 2 (to 10) and
the total number of directors constituting the Board of Directors of the
Surviving Corporation shall correspondingly be reduced to 23, (b) the number of
Continuing Directors necessary for a Special Majority shall be at least 15 (or
that number of then existing Former Dime Directors plus two), and (c) all
references to the number of directors, Former ▇▇▇▇▇▇ Directors and directors
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constituting a Special Majority shall be changed accordingly throughout this
Agreement and its Annexes (including in determining the directors for the
Subsidiary Bank). The "Minimum Equity Contribution" shall mean a contribution by
▇▇▇▇▇▇ to the Surviving Corporation at the Effective Time of an amount of
consolidated stockholders' equity (calculated in accordance with generally
accepted accounting principles, without giving effect to the items of Treasury
Stock, Accumulated Other Comprehensive Income and any reductions in capital
taken in conjunction with this Merger) equal to at least $575 million, provided
that, if the Effective Time has not yet occurred, at March 1, 2000 the Minimum
Equity Contribution shall increase by $6 million, and shall increase by $6
million on the first of each month following March 1, 2000 until the Effective
Time.
ARTICLE IV
CONVERSION OR
CANCELLATION AND EXCHANGE OF SHARES
4.1 Conversion or Cancellation of Shares. At the Effective Time, by
virtue of the Merger and without any action on the part of any stockholder of
either Dime or ▇▇▇▇▇▇:
(a) Each share of Dime Common Stock outstanding immediately prior to
the Effective Time shall be combined into 0.585 (the "Exchange Ratio")
fully paid and nonassessable shares of common stock, par value $0.01 per
share, of the Surviving Corporation ("Surviving Corporation Common Stock").
(b) Other than Exception Shares, each share of ▇▇▇▇▇▇ Common Stock
outstanding immediately prior to the Effective Time shall be converted into
and constitute one fully paid and nonassessable share of Surviving
Corporation Common Stock. Each holder of a certificate representing any
such shares of ▇▇▇▇▇▇ Common Stock shall cease to have any rights with
respect thereto, except that, from and after the Effective Time,
certificates representing ▇▇▇▇▇▇ Common Stock, other than Exception Shares,
immediately prior to the Effective Time shall be deemed for all purposes to
represent the number of shares of Surviving Corporation Common Stock into
which they were converted pursuant to this Section. "Exception Shares"
means shares of ▇▇▇▇▇▇ Common Stock held by ▇▇▇▇▇▇ or any of its
subsidiaries or by Dime or any of its subsidiaries, in each case other than
in a fiduciary capacity or in satisfaction of a debt previously contracted
in good faith.
(c) Each share of ▇▇▇▇▇▇ Common Stock constituting an Exception Share
immediately prior to the Effective Time shall be
-7-
canceled and retired at the Effective Time and no consideration shall be
issued in exchange therefor.
(d) Holders of certificates formerly representing ▇▇▇▇▇▇ Common Stock
shall not be required to exchange such certificates for certificates
representing Surviving Corporation Common Stock, provided, however, that if
an exchange of such certificates is required by law or applicable rule or
regulation, the parties will cause the Surviving Corporation to arrange for
such exchange on a one-share-for-one-share basis. Holders of certificates
representing the Dime Common Stock referred to in Section 4.1(a) ("Old
Certificates") shall exchange such Old Certificates for certificates
representing shares of Surviving Corporation Common Stock ("New
Certificates") in the manner described in Section 4.2.
(e) In the event that, subsequent to the date of this Agreement but
prior to the Effective Time, the shares of Dime Common Stock or ▇▇▇▇▇▇
Common Stock issued and outstanding shall, through a reorganization,
recapitalization, reclassification, stock dividend, stock split, reverse
stock split, or other similar change in the capitalization of Dime or
▇▇▇▇▇▇, as the case may be, increase or decrease in number or be changed
into or exchanged for a different issue or number of securities, then an
appropriate and proportionate adjustment shall be made to the Exchange
Ratio.
4.2 Exchange of Old Certificates for New Certificates. (a)
Appointment of Exchange Agent. From the Effective Time until the end of the
one-year period following the Effective Time, the Surviving Corporation shall
make available to an exchange agent (which may be a subsidiary bank of the
Surviving Corporation) appointed prior to the Effective Time by Dime and ▇▇▇▇▇▇
jointly on behalf of the Surviving Corporation (the "Exchange Agent") New
Certificates and cash in amounts sufficient to allow the Exchange Agent to make
all deliveries of New Certificates and payments that may be required in exchange
for Old Certificates pursuant to this Article IV. At the end of such one-year
period, any such New Certificates and cash remaining in the possession of the
Exchange Agent (together with any dividends or earnings in respect thereof)
shall be returned to the Surviving Corporation. Any former holders of Old
Certificates who have not theretofore exchanged their Old Certificates for New
Certificates and cash pursuant to this Article IV shall thereafter be entitled
to look exclusively to the Surviving Corporation, and only as general creditors
thereof, for the shares of Surviving Corporation Common Stock and any cash to
which they become entitled upon exchange of their Old Certificates pursuant to
this Article IV.
(b) Exchange Procedures. Promptly after the Effective Time, the
Surviving Corporation shall cause the Exchange Agent to mail or deliver to each
person who was, immediately prior to the Effective Time, a holder of record of
Dime Common Stock, a form (mutually agreed upon by Dime and
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▇▇▇▇▇▇) of letter of transmittal containing instructions for use in effecting
the surrender of Old Certificates in exchange for New Certificates and any
payments pursuant to this Article IV. Upon surrender to the Exchange Agent of an
Old Certificate for cancellation together with such letter of transmittal, duly
executed and completed in accordance with the instructions thereto, the holder
of such Old Certificate shall be entitled to receive in exchange therefor a New
Certificate representing the shares of Surviving Corporation Common Stock, and a
check in the amount, if any, to which such holder is entitled pursuant to this
Article IV, and the Old Certificate so surrendered shall forthwith be canceled.
No interest will be paid or will accrue on any amount payable upon surrender of
Old Certificates. If any New Certificate or cash payment is to be issued or made
in a name other than that in which the Old Certificate surrendered in exchange
therefor is registered, it shall be a condition of such exchange that the person
requesting such exchange shall pay any transfer or other taxes required by
reason of the issuance of such New Certificate or the making of such cash
payment in a name other than that of the registered holder of the Old
Certificate surrendered, or shall establish to the satisfaction of the Surviving
Corporation that any such taxes have been paid or are not applicable. An
Affiliate (as defined in Section 6.15) of Dime shall not be entitled to receive
any New Certificate or payment pursuant to this Article IV until such Affiliate
shall have duly executed and delivered an appropriate agreement described in
Section 6.15.
(c) Fractional Shares. Upon giving effect to the combination and
exchange described in Section 4.1(a), the resulting number of shares of
Surviving Corporation Common Stock of each registered holder of Dime Common
Stock shall be rounded down to the nearest whole number and each such registered
holder shall be entitled to receive from the Surviving Corporation in lieu of
any fractional share of Surviving Corporation Common Stock prior to such
rounding down an amount in cash (without interest) equal to the product obtained
by multiplying (a) the fraction of a share of Surviving Corporation Common Stock
to which such holder would otherwise be entitled and (b) the average of the
closing price per share of ▇▇▇▇▇▇ Common Stock for the ten trading days most
recently preceding the Closing Date as reported on the New York Stock Exchange,
Inc. (the "NYSE") Composite Transactions reporting system. Notwithstanding the
foregoing, fractional shares of Surviving Corporation Common Stock that would be
issued into a dividend reinvestment plan, 401(k) plan or other similar stock
plan maintained by Dime prior to the Effective Time shall be issued within such
plan as a fractional share of Surviving Corporation Common Stock at the
Effective Time.
(d) Transfers. At or after the Effective Time, there shall be no
transfers on the stock transfer books of the Surviving Corporation of the shares
of ▇▇▇▇▇▇ Common Stock which were outstanding immediately prior to the Effective
Time.
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(e) No Liability. In the event that any Old Certificate shall have been
lost, stolen or destroyed, upon the making of an affidavit of that fact by the
person claiming such Old Certificate to be lost, stolen or destroyed and, if
required by the Surviving Corporation, the posting by such person of a bond in
such reasonable amount as the Surviving Corporation may direct as indemnity
against any claim that may be made against it with respect to such Old Certifi-
cate, the Surviving Corporation shall, in exchange for such lost, stolen or
destroyed Old Certificate, issue or cause to be issued the shares of Surviving
Corporation Common Stock and pay or cause to be paid the amounts, if any,
deliverable in respect thereof pursuant to this Article IV.
4.3 ▇▇▇▇▇▇ Options and Warrants. At the Effective Time, by virtue of
the Merger and without any action on the part of any holder of any such option
or warrant, each option or warrant granted by ▇▇▇▇▇▇ to purchase shares of
▇▇▇▇▇▇ Common Stock (any such option or warrant being referred to as a "▇▇▇▇▇▇
Option") that is outstanding and unexercised immediately prior thereto shall
constitute an option or warrant, as the case may be, to purchase Shares of
Surviving Corporation Common Stock, on the same terms and conditions as are in
effect immediately prior to the Effective Time.
4.4 Dime Options and Warrants. At the Effective Time, without any
action on the part of any holder of any such option or warrant, each option or
warrant granted by Dime to purchase shares of Dime Common Stock (any such option
or warrant being referred to as a "Dime Option") that is outstanding and
unexercised immediately prior thereto shall be converted into an option or
warrant, as the case may be, to purchase, on the same terms and conditions as
are in effect for such Dime Option immediately prior to the Effective Time, such
number of shares of Surviving Corporation Common Stock at an exercise price
determined as provided below (and otherwise having the same duration and other
terms as the original Dime Option):
(a) the number of shares of Surviving Corporation Common Stock to be
subject to the new option or warrant shall be equal to the product of (1)
the number of shares of Dime Common Stock purchasable upon exercise of the
original Dime Option and (2) the Exchange Ratio, the product being rounded,
if necessary, up or down, to the nearest whole share; and
(b) the exercise price per share of Surviving Corporation Common Stock
under the new option or warrant shall be equal to (1) the exercise price
per share of Dime Common Stock under the original Dime Option divided by
(2) the Exchange Ratio, the quotient being rounded, if necessary, up or
down to the nearest cent.
The terms of each Dime Option shall, in accordance with its terms, be subject to
further adjustment as appropriate to reflect any reorganization,
recapitalization, reclassification, stock dividend, stock split, reverse stock
split
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or other similar change in capitalization of Dime subsequent to the Closing
Date. With respect to any Dime Options that are "incentive stock options" (as
defined in Section 422 of the Internal Revenue Code), the foregoing adjustments
shall be effected in a manner consistent with Section 424(a) of the Internal
Revenue Code.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
5.1 Disclosure Schedules. (a) On or prior to the date hereof, Dime has
delivered to ▇▇▇▇▇▇ and ▇▇▇▇▇▇ has delivered to Dime a schedule (respectively,
its "Disclosure Schedule") setting forth, among other things, items the
disclosure of which is necessary or appropriate either in response to an express
disclosure requirement contained in a provision hereof or as an exception to one
or more representations or warranties contained in Section 5.3 or to one or more
of its covenants contained in Article VI; provided that (1) no such item is
required to be set forth in a Disclosure Schedule as an exception to a
representation or warranty if its absence is not reasonably likely to result in
the related representation or warranty being deemed untrue or incorrect under
the standard established by Section 5.2, and (2) the mere inclusion of an item
in a Disclosure Schedule as an exception to a representation or warranty shall
not be deemed an admission by a party that such item represents a material
exception or fact, event or circumstance or that such item is reasonably likely
to result in a Material Adverse Effect.
(b) "Material Adverse Effect" shall mean with respect to Dime, ▇▇▇▇▇▇
or the Surviving Corporation any effect that (1) is material and adverse to the
financial position, results of operations or business of Dime and its
subsidiaries taken as a whole, ▇▇▇▇▇▇ and its subsidiaries taken as a whole or
the Surviving Corporation and its subsidiaries taken as a whole, respectively,
or (2) would materially impair the ability of either Dime or ▇▇▇▇▇▇ to perform
its obligations under this Agreement or otherwise materially threaten or
materially impede the consummation of the Merger and the other transactions
contemplated by this Agreement; provided, however, that Material Adverse Effect
shall not be deemed to include the impact of (A) changes in banking and similar
laws of general applicability or interpretations thereof by courts or
governmental authorities, (B) changes in generally accepted accounting
principles or regulatory accounting requirements applicable to depository
institutions and their holding companies generally, (C) actions or omissions of
Dime or ▇▇▇▇▇▇ taken with the prior written consent of ▇▇▇▇▇▇ or Dime, as
applicable, in contemplation of the transactions contemplated hereby, (D) any
modifications or changes to valuation policies and practices in connection with
the Merger or restructuring charges taken in connection with the Merger, in each
case in accordance with generally accepted accounting principles and (E) the
effects of any change attributable to or resulting from changes in economic
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conditions applicable to depository institutions or their holding companies
generally or in general levels of interest rates, except to the extent that the
effect of such change is materially more severe for Dime, ▇▇▇▇▇▇ or the
Surviving Corporation, as the case may be, than for depository institutions or
their holding companies generally.
(c) "Previously Disclosed" by a party shall mean information set forth
on its Disclosure Schedule corresponding to the provision of this Agreement to
which such information relates; provided that information which, on its face,
reasonably should indicate to the reader that it relates to another provision of
this Agreement shall also be deemed to be Previously Disclosed with respect to
such other provision.
5.2 Standard. No representation or warranty of Dime or ▇▇▇▇▇▇ contained
in Section 5.3 shall be deemed untrue or incorrect, and no party hereto shall be
deemed to have breached a representation or warranty, as a consequence of the
existence of any fact, circumstance or event unless such fact, circumstance or
event, individually or taken together with all other facts, circumstances or
events inconsistent with any representation or warranty contained in Section 5.3
has had or is reasonably likely to result in a Material Adverse Effect.
5.3 Representations and Warranties of Dime and ▇▇▇▇▇▇. Except as
Previously Disclosed, Dime hereby represents and warrants to ▇▇▇▇▇▇, and ▇▇▇▇▇▇
hereby represents and warrants to Dime, that:
(a) Recitals True. The statements of fact set forth in Recitals A, B
and F of this Agreement with respect to it are true.
(b) Corporate Organization and Qualification. It is a corporation duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation and is in good standing as a foreign
corporation in each jurisdiction where the properties owned, leased or
operated or the business conducted by it require such qualification. It has
the requisite corporate power and authority to own or lease its properties
and assets and to carry on its businesses as they are now being conducted.
It has made available to the other party hereto a complete and correct copy
of its certificate of incorporation and by-laws, each as amended to date
and currently in full force and effect.
(c) Subsidiaries. It has Previously Disclosed a list of its
subsidiaries as of the date of this Agreement and the amount and percent of
its ownership thereof. Each of its subsidiaries is duly organized, validly
existing, and in good standing under the laws of the jurisdiction in which
such subsidiary is incorporated or organized, and is duly qualified to do
business and in good standing in each jurisdiction where the property
owned, leased or operated, or the business
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conducted, by such subsidiary requires such qualification. Each of its
subsidiaries has the requisite power and authority to own or lease its
properties and assets and to carry on its business as it is now being
conducted. Each of its subsidiaries that is a depository institution is
an "insured depository institution" as defined in the Federal Deposit
Insurance Act ("FDIA") and applicable regulations thereunder.
(d) Capital Stock. (1) In the case of the representations and
warranties made by Dime and in addition to the statements set forth in
Recital A:
As of the date of this Agreement, there were outstanding under the
stock option and other plans Previously Disclosed (the "Dime Stock
Plans"), options or rights to acquire not more than an aggregate of
8,078,022 shares of Dime Common Stock (subject to adjustment on the
terms set forth in the Dime Stock Plans). As of the date of this
Agreement, Dime has no shares of Dime Common Stock reserved for
issuance, other than 15,954,541 shares reserved for issuance under the
Dime Stock Plans and the shares reserved for issuance under the Dime
Stock Option Agreement, and has no shares of Dime Preferred Stock
reserved for issuance. All the outstanding shares of Dime Common Stock
have been duly authorized and validly issued and are fully paid and
nonassessable. All the outstanding shares of capital stock of each of
Dime's subsidiaries owned by Dime or a subsidiary of Dime have been
duly authorized and validly issued and are fully paid and
nonassessable, and are owned by Dime or a subsidiary of Dime free and
clear of all liens, pledges, security interests, claims, proxies,
preemptive or subscriptive rights or other encumbrances or restrictions
of any kind (collectively, "Liens"). Except as set forth above
(including in Recital A) or in the Dime Stock Option Agreement or in
the Stockholder Protection Rights Agreement (the "Dime Rights
Agreement"), dated as of October 20, 1995, between Dime and The First
National Bank of Boston, as Rights Agent, and except for Dime Common
Stock issued after the date hereof pursuant to the terms of Dime Stock
Plans, there are no shares of capital stock of Dime authorized, issued
or outstanding and there are no preemptive rights or any outstanding
subscriptions, options, warrants, rights, convertible securities or
other agreements or commitments of Dime or any of its subsidiaries of
any character relating to the issued or unissued capital stock or other
securities of Dime or any of its subsidiaries (including, without
limitation, those relating to the issuance, sale, purchase, redemp-
tion, conversion, exchange, registration, voting or transfer thereof).
Other than pursuant to the ▇▇▇▇▇▇ Stock Option Agreement, as of the
date hereof, neither Dime nor any of its subsidiaries beneficially
owns, directly or indirectly, or is party to
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any agreement, arrangement or understanding for the purpose of
acquiring, holding, voting or disposing of, any shares of ▇▇▇▇▇▇
Common Stock that are, or if owned would be, Exception Shares.
(2) In the case of the representations and warranties made by ▇▇▇▇▇▇
and in addition to the statements set forth in Recital B:
As of the date of this Agreement, there were outstanding under the
stock option and other plans Previously Disclosed (the "▇▇▇▇▇▇ Stock
Plans"), options or rights to acquire not more than an aggregate of
1,141,768 shares of ▇▇▇▇▇▇ Common Stock (subject to adjustment on the
terms set forth in the ▇▇▇▇▇▇ Stock Plans). As of the date of this
Agreement, ▇▇▇▇▇▇ has no shares of ▇▇▇▇▇▇ Common Stock reserved for
issuance, other than 13,736,445 shares reserved for issuance under the
▇▇▇▇▇▇ Stock Plans and the shares reserved for issuance under the
▇▇▇▇▇▇ Stock Option Agreement, and has no shares of ▇▇▇▇▇▇ Preferred
Stock reserved for issuance. All the outstanding shares of ▇▇▇▇▇▇
Common Stock have been duly authorized and validly issued and are fully
paid and nonassessable. All the outstanding shares of capital stock of
each of ▇▇▇▇▇▇'▇ subsidiaries owned by ▇▇▇▇▇▇ or a subsidiary of ▇▇▇▇▇▇
have been duly authorized and validly issued and are fully paid and
nonassessable and owned by ▇▇▇▇▇▇ or a subsidiary of ▇▇▇▇▇▇ free and
clear of all Liens. Except as set forth above (including in Recital B)
or in the ▇▇▇▇▇▇ Stock Option Agreement and except for ▇▇▇▇▇▇ Common
Stock issued after the date hereof pursuant to the terms of the ▇▇▇▇▇▇
Stock Plans, there are no shares of capital stock of ▇▇▇▇▇▇ auth-
orized, issued or outstanding, and there are no preemptive rights or
any outstanding subscriptions, options, warrants, rights, convertible
securities or other agreements or commitments of ▇▇▇▇▇▇ or any of its
subsidiaries of any character relating to the issued or unissued
capital stock or other securities of ▇▇▇▇▇▇ or any of its subsidiaries
(including, without limitation, those relating to the issuance, sale,
purchase, redemption, conversion, exchange, registration, voting or
transfer thereof). Other than pursuant to the Dime Stock Option
Agreement, as of the date hereof, neither ▇▇▇▇▇▇ nor any of its
subsidiaries beneficially owns, directly or indirectly, or is party to
any agreement, arrangement or understanding for the purpose of
acquiring, holding, voting or disposing of, any shares of Dime Common
Stock.
(e) Corporate Authority. (1) In the case of the representations and
warranties made by Dime: It has the requisite corporate power and authority
and has taken all corporate action necessary in order to execute and
deliver this Agreement and the Stock Option Agreements
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and, subject only to the adoption by a majority of holders of the
outstanding shares of Dime Common Stock entitled to vote thereon of the
agreement of merger (including the amendments to the Certificate of
Incorporation and By-laws contemplated by Sections 2.1 and 2.2) contained
in this Agreement insofar as required by Sections 251 and 252 of the DGCL,
to consummate the transactions contemplated hereby. This Agreement is a
valid and legally binding agreement of it enforceable in accordance with
the terms hereof. Its Board of Directors (at a meeting duly called and
held) has by requisite vote (A) authorized and approved this Agreement, the
Stock Option Agreements and the transactions, including the Merger,
contemplated hereby and thereby, (B) directed that the agreement of merger
(as such term is used in Section 252 of the DGCL) contained in this
Agreement be submitted for consideration to, and adoption by, its
stockholders in accordance with Sections 251 and 252 of the DGCL and (C)
approved the execution of the Dime Stock Option Agreement and authorized
and approved the Merger (prior to the execution by Dime of this Agreement
and prior to the date of execution of the Dime Stock Option Agreement) in
accordance with Section 203 of the DGCL.
(2) In the case of the representations and warranties made by ▇▇▇▇▇▇:
It has the requisite corporate power and authority and has taken all
corporate action necessary in order to execute and deliver this Agreement
and the Stock Option Agreements and, subject only to the adoption by a
majority of the votes cast by holders of the outstanding shares of ▇▇▇▇▇▇
Common Stock entitled to vote thereon of the plan of merger contained in
this Agreement insofar as required by Section 14A: 10-3 of the NJBCA, to
consummate the transactions contemplated hereby. Article IX of its
certificate of incorporation is not applicable to the Merger or other
transactions contemplated hereby. This Agreement is a valid and legally
binding agreement of it enforceable in accordance with the terms hereof.
Its Board of Directors (at a meeting duly called and held) has by requisite
vote (A) authorized and approved this Agreement, the Stock Option
Agreements and the transactions, including the Merger, contemplated hereby
and thereby, (B) directed that the plan of merger (as such term is used in
Section 14A: 10-7 of the NJBCA) contained in this Agreement be submitted
for consideration to, and adoption by, its stockholders in accordance
Section 14A: 10-3 of the NJBCA and (C) approved the execution of the ▇▇▇▇▇▇
Stock Option Agreement and authorized and approved the Merger (prior to the
execution by ▇▇▇▇▇▇ of this Agreement and prior to the date of execution of
the ▇▇▇▇▇▇ Stock Option Agreement) in accordance with Section 14A: 10A-5 of
the NJBCA.
(f) Governmental Filings; No Violations. (1) Other than the approvals
Previously Disclosed, and other than as required under the
▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust Improvements Act of 1976, as amended, the
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Securities Exchange Act of 1934, as amended (including the rules and
regulations thereunder, the "Exchange Act"), the Securities Act of 1933, as
amended (including the rules and regulations thereunder, the "Securities
Act"), state securities laws and the rules of the New York Stock Exchange
(the "NYSE") or the National Association of Securities Dealers, Inc. (the
"NASD"), or under any federal or state banking laws or regulations, no
notices, reports or other filings are required to be made by it with, nor
are any consents, registrations, approvals, permits or authorizations
required to be obtained by it from, any governmental or regulatory
authority, agency, court, commission or other entity, domestic or foreign
("Governmental Entity"), in connection with the execution, delivery or
performance of this Agreement by it and the consummation by it of the
transactions contemplated hereby.
(2) The execution, delivery and performance of this Agreement does not
and will not, and the consummation by it of the transactions contemplated
hereby will not, constitute or result in (A) a breach or violation of, or a
default under, its certificate or articles of incorporation or by-laws, or
the comparable governing instruments of any of its subsidiaries, or (B) a
breach or violation of, or a default under, or the acceleration of or the
creation of a Lien (with or without the giving of notice, the lapse of time
or both) pursuant to, any provision of any agreement, lease, contract,
note, mortgage, indenture, arrangement or other obligation ("Contracts") of
it or any of its subsidiaries or any law, rule, ordinance or regulation or
judgment, decree, order, award or governmental or non-governmental permit
or license to which it or any of its subsidiaries is subject, or any change
in the rights or obligations of any party under any Contracts. It has
Previously Disclosed a list of all consents of third parties required under
any Contracts to be obtained by it or its subsidiaries prior to
consummation of the Merger.
(g) Reports and Financial Statements. (1) With respect to periods since
January 1, 1997, each of it and its subsidiaries has filed all reports and
statements, together with any amendments required to be made with respect
thereto, that it was required to file with (A) the Securities and Exchange
Commission (the "SEC "), (B) the Office of Thrift Supervision (the "OTS "),
(C) the Federal Deposit Insurance Corporation (the "FDIC "), (D) the
Federal Home Loan Bank System (the "FHLB "), (E) in the case of
representations and warranties of ▇▇▇▇▇▇, the Federal Reserve (as defined
in Section 5.3(k)(3)) and the New Jersey Department of Banking and
Insurance, (F) any other applicable federal or state banking, insurance,
securities, or other regulatory authorities or (G) the NYSE or the NASD,
and, as of their respective dates (and, in the case of reports or
statements filed prior to the date hereof, without giving effect to any
amendments or modifications filed after the date of this Agreement), each
such report or statement, including the financial statements and exhibits
thereto, complied (or will comply, in the case of
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reports or statements filed after the date of this Agreement) as to form in
all material respects with all applicable statutes, rules and regulations.
(2) It has delivered to the other of Dime or ▇▇▇▇▇▇ each registration
statement, offering circular, report, definitive proxy statement or
information statement under the Securities Act, the Exchange Act and state
securities laws (collectively, the "Securities Laws") filed, used or
circulated by it with respect to periods since January 1, 1997 through the
date of this Agreement and will promptly deliver each such registration
statement, offering circular, report, definitive proxy statement or
information statement filed, used or circulated after the date hereof
(collectively, its "Reports"), each in the form (including exhibits and any
amendments thereto) filed with the SEC (or if not so filed, in the form
used or circulated).
(3) As of their respective dates (and without giving effect to any
amendments or modifications filed after the date of this Agreement), each
of the Reports, including the financial statements, exhibits and schedules
thereto, filed, used or circulated prior to the date hereof complied (and
each of the Reports filed after the date of this Agreement, will comply) in
all material respects with the applicable Securities Laws and did not (or
in the case of reports, statements, or circulars filed after the date of
this Agreement, will not) contain any untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary
to make the statements made therein, in the light of the circumstances
under which they were made, not misleading.
(4) Each of its consolidated balance sheets included in or incorporated
by reference into its Reports, including the related notes and schedules,
fairly presents the consolidated financial position of it and its
subsidiaries as of the date of such balance sheet and each of the
consolidated statements of income, cash flows and stockholders' equity
included in or incorporated by reference into its Reports, including any
related notes and schedules, fairly presents the consolidated results of
operations, retained earnings and cash flows, as the case may be, of it and
its subsidiaries for the periods set forth therein (subject, in the case of
unaudited statements, to normal year-end audit adjustments), in each case
in accordance with generally accepted accounting principles consistently
applied during the periods involved, except as may be noted therein.
Collectively, its foregoing consolidated balance sheets, statements of
income, cash flows and stockholders' equity are referred to as its
"Financial Statements".
(5) It knows of no reason why the allowance for loan and lease losses
shown in its consolidated balance sheet dated June 30, 1999 included in its
Financial Statements was not adequate as of such date to
-17-
provide for estimable and probable losses, net of recoveries relating
to loans previously charged off, inherent in its loan portfolio.
(h) Asset Classification. It has Previously Disclosed a list, accurate
and complete in all material respects, of the aggregate amounts of loans,
extensions of credit and other assets of it and its subsidiaries that have
been criticized or classified as of June 30, 1999 by it, separated by
category of classification or criticism (the "Asset Classification"); and
no amounts of loans, extensions of credit or other assets that have been
classified or criticized as of the date hereof by any representative of any
Governmental Entity as "Other Loans Especially Mentioned", "Substandard",
"Doubtful", "Loss" or words of similar import are excluded from the amounts
disclosed in the Asset Classification, other than amounts of loans,
extensions of credit or other assets that were charged off by it or its
subsidiaries prior to the date hereof.
(i) Absence of Certain Events and Changes. Except as disclosed in its
Reports filed by it with the SEC since December 31, 1998, and, except as
expressly contemplated by this Agreement, it and its subsidiaries have
conducted their respective businesses only in the ordinary and usual
course of such businesses and since that date, without giving effect to the
proviso of Section 5.1(a) or to Section 5.2, there has not been any change
or development or combination of changes or developments which,
individually or in the aggregate, is reasonably likely to result in a
Material Adverse Effect.
(j) Properties. Except as disclosed or reserved against in its Reports
or Financial Statements, it and its subsidiaries have good and marketable
title, free and clear of all Liens (other than Liens for current taxes not
yet delinquent or pledges to secure deposits) to all of the material
properties and assets, tangible or intangible, reflected in its Reports as
being owned by it or its subsidiaries as of the dates thereof. All leased
buildings and all leased fixtures, equipment and other property and assets
that are material to its business on a consolidated basis are held under
valid leases or subleases by it or its subsidiaries enforceable in
accordance with their respective terms (except as may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or other laws
affecting creditors' rights generally or by general equity principles).
(k) Compliance with Laws. It and each of its subsidiaries:
(1) is in compliance with all applicable federal, state, local and
foreign statutes, laws, regulations, ordinances, rules, judgments,
orders or decrees applicable thereto or to the employees conducting
such businesses;
-18-
(2) has all permits, licenses, certificates of authority, orders,
and approvals of, and has made all filings, applications, and
registrations with, federal, state, local, and foreign governmental or
regulatory bodies that are required in order to permit it or such
subsidiary to carry on its business as it is presently conducted;
(3) has received since January 1, 1997 no notification or
communication from any Governmental Entity (including the OTS, the
FDIC, the Board of Governors of the Federal Reserve System (the
"Federal Reserve") and any other bank, insurance or securities
regulatory authorities) or the staff thereof (A) asserting that it or
any of its subsidiaries is not in compliance with any of the statutes,
regulations or ordinances that such Governmental Entity enforces; (B)
threatening to revoke any license, franchise, permit or governmental
authorization; or (C) threatening or contemplating revocation or
limitation of, or which would have the effect of revoking or limiting,
FDIC deposit insurance (nor, to its knowledge, do any grounds for any
of the foregoing exist); and
(4) is not required to give prior notice to any federal banking or
thrift agency of the proposed addition of an individual to its board of
directors or the employment of an individual as a senior executive.
(l) Litigation. Except as disclosed in its Reports filed with the SEC
prior to the date hereof, there are no criminal or administrative
investigations or hearings of, before or by any Governmental Entity, or
civil, criminal or administrative actions, suits, claims or proceedings of,
before or by any person (including any Governmental Entity) pending or, to
its knowledge, threatened, against it or any of its subsidiaries; and
neither it nor any of its subsidiaries (nor any officer, director,
controlling person or property of it or any of its subsidiaries) is a party
to or is subject to any order, decree, agreement, memorandum of
understanding or similar arrangement with, or a commitment letter or
similar submission to, any Governmental Entity charged with the supervision
or regulation of depository institutions or engaged in the insurance of
deposits (including, without limitation, the OTS, the Federal Reserve, the
FHLB and the FDIC) or the supervision or regulation of it or any of its
subsidiaries and neither it nor any of its subsidiaries has been advised by
any such Governmental Entity that such Governmental Entity is contemplating
issuing or requesting (or is considering the appropriateness of issuing or
requesting) any such order, decree, agreement, memorandum of understanding,
commitment letter or similar submission.
-19-
(m) Taxes. (1) The term "Tax" or "Taxes" includes any tax or similar
governmental charge, impost or levy (including, without limitation, income
taxes, franchise taxes, transfer taxes or fees, stamp taxes, sales taxes,
use taxes, excise taxes, ad valorem taxes, withholding taxes, employee
withholding taxes, worker's compensation, payroll taxes, unemployment
insurance, social security, minimum taxes or windfall profits taxes),
together with any related liabilities, penalties, fines, additions to tax
or interest, imposed by the United States or any state, county, provincial,
local or foreign government or subdivision or agency thereof.
(2) All federal, state and local Tax returns, including all information
returns, required to be filed by or on behalf of it or any of its
subsidiaries have been timely filed or requests for extensions have been
timely filed and any such extension shall have been granted and not have
expired, and all such filed returns are complete and accurate in all
material respects. Except as disclosed in its Reports, all Taxes
attributable to it or any of its subsidiaries that are or were due or
payable (without regard to whether such Taxes have been assessed) have been
paid in full or have been adequately provided for on its consolidated
balance sheet and consolidated statement of earnings or income (in
accordance with generally accepted accounting principles). Adequate
provision in accordance with generally accepted accounting principles
appropriately and consistently applied has been made in the Reports
relating to all Taxes for the periods covered thereby that were not yet due
and payable as of the dates thereof, regardless of whether the liability
for such Taxes is disputed. As of the date of this Agreement and except as
disclosed in its Reports, there is no outstanding audit examination,
deficiency, refund litigation or outstanding waivers or agreements
extending the applicable statute of limitations for the assessment or
collection of any Taxes for any period with respect to any Taxes of it or
its subsidiaries. All Taxes, interest, additions and penalties due with
respect to completed and settled examinations or concluded litigation
relating to it or any of its subsidiaries have been paid in full or have
been recorded on its or such subsidiary's balance sheet and consolidated
statement of earnings or income (in accordance with generally accepted
accounting principles). Neither it nor any of its subsidiaries is a party
to a tax sharing or similar agreement or any agreement pursuant to which it
or any of its subsidiaries has indemnified any party (other than it or one
of its subsidiaries) with respect to Taxes. The proper and accurate amounts
have been or will be withheld from all employees (and timely paid to the
appropriate Governmental Entity or set aside in an account for such
purposes) for all periods through the Closing Date in compliance with all
Tax withholding provisions of applicable federal, state, local and foreign
laws (including, without limitation, income, social security and employment
tax withholding for all types of compensation).
-20-
(n) Insurance. Each of it and its subsidiaries has taken all requisite
action (including without limitation the making of claims and the giving of
notices) pursuant to its directors' and officers' liability insurance
policy or policies in order to preserve all rights thereunder with respect
to all matters (other than matters arising in connection with this
Agreement and the transactions contemplated hereby) that are known to it.
It has Previously Disclosed a list of all directors' and officers'
liability insurance policies maintained by it or its subsidiaries.
(o) Labor Matters. Neither it nor any of its subsidiaries is a party
to, or is bound by, any collective bargaining agreement, contract or other
agreement or understanding with a labor union or labor organization, nor is
it or any of its subsidiaries the subject of any material proceeding
asserting that it or any such subsidiary has committed an unfair labor
practice or seeking to compel it or such subsidiary to bargain with any
labor organization as to wages or conditions of employment, nor is there
any strike involving it or any of its subsidiaries pending or, to its
knowledge, threatened, nor is it aware of any activity involving its or
any of its subsidiaries' employees seeking to certify a collective
bargaining unit or engaging in any other organizational activity.
(p) Employee Benefits. (1) As of the date of this Agreement, it has
Previously Disclosed a list of all bonus, deferred compensation, pension,
retirement, profit-sharing, thrift, savings, employee stock ownership,
stock bonus, stock purchase, restricted stock and stock option plans, all
material employment or severance contracts, consulting agreements and all
other material employee benefit plans that cover employees, former
employees, directors or independent contractors (and their spouses,
dependents or beneficiaries) of it and its subsidiaries (its "Compensation
Plans"). True and complete copies of the Compensation Plans (and, as
applicable, copies of summary plan descriptions, governmental filings (on
Form 5500 series or otherwise), actuarial reports and reports under
Financial Accounting Standards Board Statement No. 106 relating thereto)
and all other benefit plans, contracts or arrangements (regardless of
whether they are funded or unfunded or foreign or domestic) covering
current or former employees, directors or independent contractors (and
their spouses, dependents or beneficiaries) of it or its subsidiaries (its
"Employees"), including, but not limited to, "employee benefit plans"
within the meaning of Section 3(3) of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), and all amendments thereto,
have been made available to the other party.
(2) Except as disclosed in its Reports or as provided in this
Agreement, the transactions contemplated by this Agreement and the Stock
Option Agreements will not result in the vesting or acceleration of any
amounts under any Compensation Plan, any material increase in
-21-
benefits under any Compensation Plan or payment of any severance or
similar compensation under any Compensation Plan.
(3) All of its and its subsidiaries' employee benefit plans, within the
meaning of Section 3(3) of ERISA, other than "multiemployer plans" within
the meaning of Section 3(37) or 4001(a)(3) of ERISA, covering Employees
(collectively, its "Plans") are in compliance with the applicable
provisions of ERISA and the Internal Revenue Code, and other applicable
laws in all material respects. Each of its Plans which is an "employee
pension benefit plan" within the meaning of Section 3(2) of ERISA ("Pension
Plan") and which is intended to be qualified under Section 401(a) of the
Internal Revenue Code has received a favorable determination letter from
the Internal Revenue Service, and it is not aware of any circumstances
likely to result in revocation of any such favorable determination letter.
There is no pending or, to its knowledge, threatened litigation relating to
its Plans. Neither it nor any of its subsidiaries has engaged in a
transaction with respect to any Plan that could subject it or any of its
subsidiaries to a tax or penalty imposed by either Section 4975 of the
Internal Revenue Code or Section 502(i) of ERISA.
(4) No liability under Subtitle C or D of Title IV of ERISA (other than
payment of applicable premiums) has been or is expected to be incurred by
it or any of its subsidiaries with respect to any ongoing, frozen or
terminated "single-employer plan", within the meaning of Section
4001(a)(15) of ERISA, currently or formerly maintained by any of them, or
the single-employer plan of any entity which is considered one employer
with it under Section 4001 of ERISA or Section 414 of the Internal Revenue
Code (an "ERISA Affiliate"). It and its subsidiaries and ERISA Affiliates
have not incurred and do not expect to incur any material withdrawal
liability with respect to a multiemployer plan under Subtitle E of Title IV
of ERISA (regardless of whether based on contributions of an ERISA
Affiliate), nor has it or any of its subsidiaries or ERISA Affiliates been
notified by any multiemployer plan to which it or any of its subsidiaries
or ERISA Affiliates is contributing, or may be obligated to contribute,
that such multiemployer plan is currently in reorganization or insolvency
under and within the meaning of Section 4241 or 4245 of ERISA or that such
multiemployer plan intends to terminate or has been terminated under
Section 4041A of ERISA. No notice of a "reportable event", within the
meaning of Section 4043 of ERISA, for which the 30-day reporting
requirement has not been waived, has been required to be filed for any of
its Pension Plans or by any of its ERISA Affiliates within the 12-month
period ending on the date hereof. Neither it, its subsidiaries nor any of
their respective ERISA Affiliates has incurred or is aware of any facts
that are reasonably likely to result in any liability pursuant to Section
4069 or 4204 of ERISA.
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(5) All material contributions required to be made by it and its
subsidiaries under the terms of any of its Plans have been timely made or
have been reflected on its Financial Statements. Neither any of its Pension
Plans nor any single-employer plan of any of its ERISA Affiliates has an
"accumulated funding deficiency" (whether or not waived) within the meaning
of Section 412 of the Internal Revenue Code or Section 302 of ERISA. None
of it, its subsidiaries or its ERISA Affiliates has provided, or is
required to provide, security to any Pension Plan or to any single-employer
plan of an ERISA Affiliate pursuant to Section 401(a)(29) or 412(f)(3) of
the Internal Revenue Code or Section 306, 307 or 4204 of ERISA.
(6) Under each of its and its ERISA Affiliates' Pension Plans which is
a single-employer plan, as of the last day of the most recent plan year
ended prior to the date of this Agreement, the actuarially determined
present value of all "benefit liabilities", within the meaning of Section
4001(a)(16) of ERISA (as determined on the basis of the actuarial
assumptions contained in the Pension Plan's most recent actuarial
valuation), did not exceed the then current value of the assets of such
Pension Plan, and to its knowledge, there has been no change in the
financial condition of such Pension Plan since the last day of the most
recent plan year which reasonably could be expected to change such
conclusion. There would be no withdrawal liability of it and its
subsidiaries under each benefit plan which is a multiemployer plan to which
it, its subsidiaries or its ERISA Affiliates has contributed during the
preceding 12 months, if such withdrawal liability were determined as if a
"complete withdrawal", within the meaning of Section 4203 of ERISA, had
occurred as of the date hereof.
(7) Except as disclosed in its Reports, neither it nor its subsidiaries
have any obligations for retiree health and life benefits.
(8) There are no restrictions on the rights of it or its subsidiaries
to amend or terminate any Plan without incurring any liability thereunder
in addition to normal liabilities for benefits.
(q) Environmental Matters. (1) For purposes of this Section 5.3(q), the
following terms shall have the indicated meaning:
"Business" means the business conducted by it and its
subsidiaries.
"Environmental Law" means any federal, state, local or foreign
law, regulation, agency policy, order, decree, judgment or judicial
opinion or any agreement with any Government Entity, presently in
effect or hereinafter adopted relating to (A) the manufacture,
generation, transport, use, treatment, storage,
-23-
recycling, disposal, release, threatened release or presence of
Hazardous Substances or (B) the preservation, restoration or protection
of the environment, natural resources or human health.
"Hazardous Substances" means substances which are: (A) listed,
classified or regulated pursuant to any Environmental Law; (B) any
petroleum products or by-products, asbestos containing material,
polychlorinated biphenyls ("PCBs"), radioactive materials or radon gas;
or (C) any other matter to which exposure is prohibited, limited or
regulated by any government authority or Environmental Law.
"Subject Property" means (A) all real property at which the
businesses of it or any of its subsidiaries have been conducted, all
property in which it or any of its subsidiaries holds a security or
other interest (including, without limitation, a fiduciary interest),
and, where required by the context, includes any such property where
under any Environmental Law it or any of its subsidiaries constitutes
the owner or operator of such property, but only with respect to such
property, (B) any facility in which it or any of its subsidiaries
participates in the management, including, where required by the
context, participating in the management of the owner or operator of
such property, and (C) all other real property which for purposes of
any Environmental Law it or any of its subsidiaries otherwise could be
deemed to be an owner or operator or otherwise control.
(2) To its knowledge, it and each of its subsidiaries and the Subject
Property are, and have been, in compliance with all Environmental Laws and
there are no circumstances that with the passage of time or the giving of
notice would be reasonably likely to result in noncompliance.
(3) To its knowledge, there are no pending or threatened claims,
actions, investigations, notices of non-compliance, information requests or
notices of potential responsibility or proceedings involving it or any of
its subsidiaries or any Subject Property relating to:
(A) an asserted liability of it or any of its subsidiaries or any
prior owner, occupier or user of Subject Property under any
Environmental Law or the terms and conditions of any permit, license,
authority, settlement, agreement, decree or other obligation arising
under any Environmental Law;
(B) the handling, storage, use, transportation, removal or
disposal of Hazardous Substances;
-24-
(C) the actual or threatened discharge, release or emission of
Hazardous Substances from, on or under or within Subject Property into
the air, water, surface water, ground water, land surface or subsurface
strata; or
(D) personal injuries or damage to property related to or arising
out of exposure to Hazardous Substances;
and, to its knowledge, there is no reasonable basis for any of the
foregoing.
(4) To its knowledge, there are no storage tanks underground or
otherwise present on the Subject Property or, if present, all such tanks
are not leaking and are in full compliance with any Environmental Law. To
its knowledge, with respect to any Subject Property, it and its
subsidiaries do not own, possess or control any PCBs, PCB-contaminated
fluids, wastes or equipment, and it and its subsidiaries do not own,
possess or control any asbestos or asbestos-containing material. To its
knowledge, no Hazardous Substances have been used, handled, stored,
discharged, released or emitted, or are threatened to be discharged,
released or emitted, at or on any Subject Property, except for those types
and quantities of Hazardous Substances typically used in an office
environment and which have not created conditions requiring remediation
under any Environmental Law.
(5) To its knowledge and except for investigation or monitoring by the
Environmental Protection Agency or similar state agencies in the ordinary
course, no part of the Subject Property has been or is scheduled for
investigation or monitoring pursuant to any Environmental Law.
(r) Risk Management Instruments. All swaps, caps, floors, option
agreements, futures and forward contracts and other similar risk management
arrangements, whether entered into for its own account, or for the account
of one or more of its subsidiaries or their customers, were entered into
(1) in accordance with prudent business practices and all applicable laws,
rules, regulations and regulatory policies and (2) with counterparties
believed to be financially responsible at the time; and each of them
constitutes the valid and legally binding obligation of it or one of its
subsidiaries, enforceable in accordance with its terms (except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium, fraudulent transfer and similar laws of general
applicability relating to or affecting creditors' rights or by general
equity principles), and are in full force and effect. Neither it nor its
subsidiaries, nor to its knowledge any other party thereto, is in breach of
any of its obligations under any such agreement or arrangement.
-25-
(s) Material Agreements. (1) As of the date of this Agreement, without
giving effect to the proviso of Section 5.1(a) and to Section 5.2, except
for (A) the Stock Option Agreements, and (B) arrangements made after the
date and in accordance with the terms of this Agreement, it and its
subsidiaries are not bound by any material contract (as defined in Item
601(b)(10) of Regulation S-K under the Securities Act, but without giving
effect to the ordinary course of business exception provided for therein)
to be performed after the date hereof that has not been filed with or
incorporated by reference in its Reports.
(2) None of it nor any of its subsidiaries is in default under any
contract, agreement, commitment, arrangement, indenture, lease, insurance
policy or other instrument.
(t) Knowledge as to Conditions. (1) As of the date of this Agreement,
it knows of no reason why any regulatory approvals and, to the extent
necessary, any other approvals, authorizations, filings, registrations, and
notices should not be obtained without the imposition of any condition or
restriction described in the proviso to Section 7.1(b), or why the
accountants' letters referred to in Section 7.1(g) or the opinions of tax
counsel referred to in Sections 7.2(d) and 7.3(c) cannot be obtained.
(2) In the case of the representations and warranties made by ▇▇▇▇▇▇,
as of the date hereof, ▇▇▇▇▇▇ knows of no reason why either of the
transactions (the "Pending Transactions") contemplated by (A) the Agreement
and Plan of Merger, dated June 28, 1999 by and among ▇▇▇▇▇▇, ▇▇▇▇▇▇ United
Bank, a New Jersey bank and wholly owned subsidiary of ▇▇▇▇▇▇, JeffBanks,
Inc., a Pennsylvania corporation, Jefferson Bank, a Pennsylvania bank and
wholly owned subsidiary of JeffBanks, and Jefferson Bank of New Jersey, a
New Jersey bank and wholly owned subsidiary of JeffBanks, and (B) the
Agreement and Plan of Merger, dated June 28, 1999, by and among ▇▇▇▇▇▇,
▇▇▇▇▇▇ United Bank and Southern Jersey Bancorp of Delaware, Inc., a
Delaware corporation, and Farmers and Merchants National Bank, a national
banking association, should not be consummated. In case either or both of
the Pending Transactions shall fail to be consummated, such mere failure,
in and of itself, shall not constitute a breach of any provision of this
Agreement or give Dime any right of termination hereunder.
(u) Year 2000 Compliance. (1) All computer software and hardware used
in its businesses is Year 2000 Compliant (as defined below) or is
scheduled, according to an internal plan and budget, to be Year 2000
Compliant prior to December 31, 1999.
(2) It has disclosed to the other party its plans for evaluating
whether the business conducted by it or its subsidiaries is Year 2000
-26-
Compliant. Neither it or its subsidiaries has received any written notice
or, to its knowledge, oral notice from any Governmental Entity which
indicates that such Governmental Entity considers or would consider the
businesses conducted by it or its subsidiaries not to be Year 2000
Compliant.
(3) "Year 2000 Compliant" means, with respect to any computer software
or hardware and other processing capabilities of a party, that such
software or hardware and processing capabilities are able, in all material
respects, accurately to process date and time data (including calculating,
comparing, and sequencing) from, into and between the years 1999 and 2000
and leap year calculations, and will not generate erroneous data or cause a
system to fail because of a date of the year 1999 or greater or spanning
the years 1999 and 2000.
(v) Brokers and Finders. None of it, its subsidiaries or any of their
officers, directors or employees has employed any broker or finder or
incurred any liability for any brokerage fees, commissions or finder's fees
in connection with the transactions contemplated herein, except that ▇▇▇▇▇▇
has retained ▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co. as its financial advisor and Dime has
retained Credit Suisse First Boston as its financial advisor, the
arrangements with which have been disclosed in writing to the other party
prior to the date hereof.
ARTICLE VI
COVENANTS
6.1 Conduct of Business Pending the Effective Time. Each of Dime and
▇▇▇▇▇▇ agrees as to itself and its subsidiaries that, from and after the date
hereof until the Effective Time, except insofar as the other party shall
otherwise consent in writing (such consent not to be unreasonably withheld or
delayed) or except as otherwise expressly contemplated by this Agreement or the
Stock Option Agreements or as Previously Disclosed:
(a) The business of it and its subsidiaries will be conducted only in
the ordinary and usual course and, to the extent consistent therewith, it
and its subsidiaries will use all reasonable efforts to preserve intact
their business organizations and assets and maintain their rights,
franchises and existing relations with customers, suppliers, employees and
business associates and to take no action that would (1) adversely affect
the ability of any of them to obtain any necessary approvals of
Governmental Entities required for the transactions contemplated hereby
without imposition of a condition or restriction of the type referred to in
the proviso to Section 7.1(b), (2) adversely affect its ability to perform
its obligations under this Agreement or the Stock Option
-27-
Agreements or (3) be reasonably likely to result in a Material Adverse
Effect.
(b) It will not (1) sell or pledge or agree to sell or pledge or permit
any Lien to exist on any stock owned by it of any of its material subsidi-
aries; (2) amend its certificate of incorporation or by-laws; (3) split,
combine or reclassify any outstanding capital stock; (4) other than as
permitted by Section 6.2, declare, set aside or pay any dividend payable in
cash, stock or other property with respect to any of its capital stock; or
(5) repurchase, redeem or otherwise acquire, or permit any subsidiary to
purchase or otherwise acquire, directly or indirectly, any shares of its
capital stock or any securities convertible into or exercisable for any
shares of its capital stock (other than such capital stock repurchased
pursuant to the Dime Stock Plans and the ▇▇▇▇▇▇ Stock Plans, as the case
may be).
(c) Notwithstanding anything to the contrary contained in Section 6.3,
neither it nor any of its subsidiaries will (1) issue, sell, pledge,
dispose of or encumber, or authorize or propose the issuance, sale, pledge,
disposition or encumbrance of, any shares of, or securities convertible or
exchangeable for, or options, warrants, calls, commitments or rights of
any kind to acquire, any shares of its capital stock of any class, with the
exception of Dime Common Stock or ▇▇▇▇▇▇ Common Stock issuable as of the
date hereof pursuant to the Dime Stock Plans or ▇▇▇▇▇▇ Stock Plans,
respectively, consistent with past practice, and the Stock Option
Agreements; (2) transfer, lease, license, guarantee, sell, mortgage, pledge
or dispose of any other material property or assets or encumber any
property or assets other than to a direct or indirect wholly owned
subsidiary of it; (3) cancel, release, assign or modify any material amount
of indebtedness of any other individual, corporation or other entity
(collectively, a "Person") other than in the ordinary and usual course of
business; or (4) authorize capital expenditures other than in the ordinary
and usual course of business.
(d) Except as expressly contemplated in this Agreement and except for
internal reorganizations involving existing subsidiaries, neither it nor
any of its subsidiaries will make any material acquisition of, or
investment in, assets or stock of any other Person not in the ordinary and
usual course of business.
(e) Other than in the ordinary course of business consistent with past
practice, it will not incur or permit any of its subsidiaries to incur any
indebtedness for borrowed money or assume, guarantee, endorse or otherwise
as an accommodation become responsible for the obligations of any other
Person or make any loan or advance.
-28-
(f) Except as required by agreements or arrangements Previously
Disclosed or as provided in Section 6.1(k) or as contemplated by Article
III, neither it nor any of its subsidiaries will (1) grant any increase in
compensation or benefits to its Employees or to its officers, except for
normal increases consistent with past practice or as required by law; (2)
pay any bonus except as consistent with past practice; (3) grant any
severance or termination pay to any director, officer or other of its
Employees except as consistent with past practice; (4) enter into or amend
any employment or severance agreement with any director, officer or other
of its Employees (provided that this clause (4) shall not prohibit either
party from approving a renewal or other extension of an existing employment
or severance agreement in accordance with its terms and in the ordinary
course of business); (5) grant any increase in fees or other increases in
compensation or other benefits to any of its present or former directors;
or (6) effect any change in retirement benefits for any class of its
Employees or officers (unless such change is required by applicable law or,
in the written opinion of counsel, is necessary or advisable to maintain
the tax qualification of any plan under which the retirement benefits are
provided); provided, however, that nothing in this Section 6.1 shall
prevent Dime from renegotiating, amending or modifying the current
Employment Agreement with ▇▇. ▇▇▇▇ provided that (i) any additional
benefits provided to ▇▇. ▇▇▇▇ thereunder are commensurate with those to be
provided to ▇▇. ▇▇▇▇▇▇▇ subsequent to the Effective Time under the
Employment Agreement with ▇▇. ▇▇▇▇▇▇▇ and that such amendment or
modification shall not extend ▇▇. ▇▇▇▇'▇ employment beyond that permitted
by the provisions of Article III of this Agreement and (ii) such amendment
or modification is approved by the Compensation Committee or other similar
committee of the Board of Directors of Dime.
(g) Except as provided in Section 6.1(k) and as may be required to
satisfy contractual obligations existing as of the date hereof and the
requirements of applicable law, neither it nor any of its subsidiaries will
establish, adopt, enter into or make any new, or amend any existing,
collective bargaining, bonus, profit sharing, thrift, compensation, stock
option, restricted stock, pension, retirement, employee stock ownership,
deferred compensation, employment, termination, severance or other plan,
agreement, trust, fund, policy or arrangement for the benefit of any
directors, officers or employees.
(h) Neither it nor any of its subsidiaries will implement or adopt any
change in its accounting principles, practices or methods, other than as
may be required by generally accepted accounting principles.
(i) Neither it nor any of its subsidiaries shall make any tax election,
other than in the ordinary course of business.
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(j) Neither it nor any of its subsidiaries will authorize or enter into
an agreement to take any of the actions referred to in paragraphs (a)
through (i) above.
(k) Notwithstanding the provisions of Sections 6.1(f) and (g) herein,
each party hereto shall be permitted to take, or authorize or agree to
take, any of the actions contemplated in such Sections without the consent
of the other party, if such action (1) is reasonably necessary to qualify
for, or preserve, an exemption of certain transactions from the operation
of Section 16(b) of the Exchange Act in accordance with the provisions of
SEC Rule 16b-3, as amended, or (2) is Previously Disclosed.
6.2 Dividends. Unless Dime and ▇▇▇▇▇▇ otherwise agree in writing,
neither Dime nor ▇▇▇▇▇▇ will declare or pay any dividend or distribution on
shares of their capital stock, whether payable in cash, stock or other property,
other than (a) dividends from subsidiaries of Dime or ▇▇▇▇▇▇ to Dime or ▇▇▇▇▇▇
or to another subsidiary of Dime or ▇▇▇▇▇▇, as applicable, consistent with past
practice or (b) regular quarterly dividends or distributions, provided that (1)
such dividends or distributions, and their corresponding record dates and
payment dates, are coordinated between the parties and are in the ordinary
course consistent with past practice and (2) such dividends or distributions are
not in amounts exceeding $0.25 per quarter in the case of ▇▇▇▇▇▇ and $0.06 per
quarter in the case of Dime, subject to and consistent with each party's normal
practice for scheduled increases in the rate of dividends paid on its common
stock.
6.3 Acquisition Proposals. Each of Dime and ▇▇▇▇▇▇ agrees that neither
it nor any of its subsidiaries nor any of its respective officers and directors
or the officers and directors of its subsidiaries shall, and it shall direct and
use all reasonable efforts to cause its employees, agents and representatives
(including, without limitation, any investment banker, attorney or accountant
retained by it or any of its subsidiaries) not to, initiate, solicit or
encourage, directly or indirectly, any inquiries or the making or implementation
of any proposal or offer with respect to a merger, acquisition, consolidation or
similar transaction involving, or any purchase of all or any substantial part of
the assets or any equity securities of, it or any of its subsidiaries (any such
proposal or offer being hereinafter referred to as an "Acquisition Proposal") or
engage in any negotiations concerning, or provide any confidential information
or data to, or have any discussions with, any such person relating to an
Acquisition Proposal. ▇▇▇▇▇▇ will notify Dime, and Dime will notify ▇▇▇▇▇▇,
immediately if any such inquiries or proposals are received by, any such infor-
mation is requested from, or any such negotiations or discussions are sought to
be initiated or continued with, it.
6.4 Stockholder Approvals; Election of Directors. Each of Dime and
▇▇▇▇▇▇ agrees to take, in accordance with applicable law and its
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respective certificate of incorporation and by-laws, all action necessary to
convene a meeting of holders of Dime Common Stock (the "Dime Meeting") and
▇▇▇▇▇▇ Common Stock (the "Hudson Meeting"), respectively, as promptly as
practicable after the Registration Statement (as defined in Section 6.5) is
declared effective to consider and vote upon the adoption of the agreement of
merger (within the meaning of Section 252 of the DGCL) or plan of merger (within
the meaning of Section 14A: 10-3 of the NJBCA) contained in this Agreement, and,
with respect to the Dime Meeting, the amendment to its certificate of
incorporation and by-laws to effect amendments contemplated by this Agreement.
The Board of Directors of each of Dime and ▇▇▇▇▇▇ will recommend such adoption,
and each of Dime and ▇▇▇▇▇▇ will take all reasonable action to solicit such
adoption by its respective stockholders, and the Governance and Nominating
Committee of the Board of Directors of Dime will nominate the Former ▇▇▇▇▇▇
Directors (as designated pursuant to Section 3.2(a)) for, and Dime's Board of
Directors will take all reasonable action necessary for, the election of such
persons as directors of Surviving Corporation prior to or at the Effective Time.
6.5 Filings; Other Actions. (a) Each of Dime and ▇▇▇▇▇▇ agrees to
cooperate in the preparation of a registration statement on Form S-4 to be filed
by Dime with the SEC in connection with the issuance of Surviving Corporation
Common Stock in the Merger (including the joint proxy statement and prospectus
and other proxy solicitation materials of Dime and ▇▇▇▇▇▇ constituting a part
thereof (the "Joint Proxy Statement"), the "Registration Statement"). Dime
agrees to use all reasonable efforts to cause the Registration Statement to be
declared effective under the Securities Act as promptly as practicable after
filing thereof. Dime also agrees to use all reasonable efforts to obtain all
necessary state securities law permits and approvals required to carry out the
transactions contemplated by this Agreement, and ▇▇▇▇▇▇ agrees to furnish all
information concerning ▇▇▇▇▇▇ and the holders of ▇▇▇▇▇▇ Common Stock as may be
reasonably requested in connection with any such action.
(b) Each of Dime and ▇▇▇▇▇▇ agrees to cooperate and consult with the
other and, on the terms and subject to the conditions set forth in this
Agreement, use reasonable efforts to prepare and file all necessary
documentation, to effect all necessary applications, notices, petitions, filings
and other documents, and to obtain all necessary permits, consents, orders,
approvals and authorizations of, or any exemption by, all third parties and
Governmental Entities necessary or advisable to consummate the transactions
contemplated by this Agreement. Each of Dime and ▇▇▇▇▇▇ shall have the right to
review in advance, and to the extent practicable each will consult with the
other, in each case subject to applicable laws relating to the exchange of
information, with respect to all the information relating to the other party,
and any of their respective subsidiaries, which appear in any filing made with,
or written materials submitted to, any third party or any Governmental Entity in
connection with the transactions contemplated by this Agreement. In
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exercising the foregoing right, each of the parties hereto agrees to act
reasonably and as promptly as practicable. Each party hereto agrees to keep the
other party apprised of the status of matters relating to completion of the
transactions contemplated hereby.
(c) Each party agrees, upon request, to furnish the other party with
all information concerning itself, its subsidiaries, directors, officers and
stockholders and such other matters as may be reasonably necessary or advisable
in connection with the Registration Statement or Joint Proxy Statement or any
other statement, filing, notice or application made by or on behalf of such
other party or any of its subsidiaries to any Governmental Entity in connection
with the Merger and the other transactions contemplated by this Agreement.
(d) Each of Dime and ▇▇▇▇▇▇ agrees to consult and cooperate with the
other in effecting actions and measures for the purpose of ensuring the orderly
consummation of the transactions contemplated hereby and the efficient conduct
of the combined businesses of Dime and ▇▇▇▇▇▇ following the Merger. Without
limiting the foregoing, each of Dime and ▇▇▇▇▇▇ agrees, to the extent consistent
with applicable law, to consult and cooperate with the other in (1) developing a
joint business plan for periods beginning at the Effective Time and (2) taking
reasonable steps in an effort to enable the Surviving Corporation to achieve the
objectives stated in such joint business plan.
6.6 Information Supplied. Each of ▇▇▇▇▇▇ and Dime agrees, as to itself
and its subsidiaries, that none of the information supplied or to be supplied by
it for inclusion or incorporation by reference in (a) the Registration Statement
will, at the time the Registration Statement and each amendment and supplement
thereto, if any, become effective under the Securities Act, contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein not misleading, and
(b) the Joint Proxy Statement and any amendment or supplement thereto will, at
the date of mailing to stockholders and at the times of the Dime Meeting and the
▇▇▇▇▇▇ Meeting to be held in connection with this Agreement, contain any
statement which, in the light of the circumstances under which such statement is
made, will be false or misleading with respect to any material fact, or which
will omit to state any material fact necessary in order to make the statements
therein not false or misleading or necessary to correct any statement in any
earlier statement in the Joint Proxy Statement or any amendment or supplement
thereto. Neither the Joint Proxy Statement nor the Registration Statement shall
be filed, and, prior to the termination of this Agreement, no amendment or
supplement to the Joint Proxy Statement or the Registration Statement shall be
filed, by Dime or ▇▇▇▇▇▇ without consultation with the other party and its
counsel.
6.7 Accountants' Letters. Dime agrees to use all reasonable efforts to
cause to be delivered to ▇▇▇▇▇▇ a letter of KPMG LLP, independent
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auditors to Dime, and ▇▇▇▇▇▇ agrees to use all reasonable efforts to cause to be
delivered to Dime a letter of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, independent auditors to ▇▇▇▇▇▇,
each dated (1) the date on which the Registration Statement shall become
effective and (2) a date shortly prior to or on the Closing Date, and addressed
to such other party in form and substance customary for "comfort" letters
delivered by independent accountants in connection with registration statements
similar to the Registration Statement.
6.8 Access. Upon reasonable notice, each party agrees to (and shall
cause each of its subsidiaries to) afford the other party's officers, employees,
counsel, accountants and other authorized representatives ("Representatives")
access, during normal business hours throughout the period until the Closing
Date, to its properties, books, contracts and records and, during such period,
shall (and shall cause each of its subsidiaries to) furnish promptly to the
other party all information concerning its business, properties and personnel as
may reasonably be requested; provided that no investigation pursuant to this
Section 6.8 shall affect or be deemed to modify any representation or warranty
made by the party furnishing such information. Each party will not, and will
cause its respective Representatives not to, use any information obtained
pursuant to this Section 6.8 for any purpose unrelated to the consummation of
the transactions contemplated by this Agreement. Subject to the requirements of
applicable law, pending consummation of the transactions herein contemplated,
each party conducting an investigation hereunder will keep confidential, and
will cause its Representatives to keep confidential, all information and
documents obtained from the other party pursuant to this Section 6.8 or during
the investigation leading up to the execution of this Agreement. The agreements
between Dime and ▇▇▇▇▇▇ regarding the confidentiality of such information in
effect at the date hereof (the "Confidentiality Agreements") shall continue and
survive in full force and effect until the Effective Time or, in the event this
Agreement is terminated, shall continue in accordance with the terms thereof.
Upon any termination of this Agreement, each party will collect and deliver to
the other party all nonpublic documents obtained by it or any of its
Representatives and then in their possession and any copies thereof and destroy
or cause to be destroyed all notes, memoranda or other documents in the
possession of it or of its Representatives containing or reflecting any
nonpublic information obtained from the other party, except to the extent that
any such information may be embodied in minutes of the meetings of such party's
Board of Directors or in filings, reports or submissions to or with any
Governmental Entity.
6.9 Notification of Certain Matters. Each of Dime and ▇▇▇▇▇▇ will give
prompt notice to the other of any fact, event or circumstance known to it that
(a) is reasonably likely to result in any Material Adverse Effect, (b) would
cause or constitute a material breach of any of the representations, warranties,
covenants or agreements of such party contained herein or (c) is reasonably
likely to result in the failure of a condition to consummation set forth in
Article VII to be satisfied on or prior to June 30, 2000.
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6.10 Publicity. The initial press release relating hereto will be a
joint press release and thereafter ▇▇▇▇▇▇ and Dime shall consult with each other
prior to issuing any press releases or otherwise making public statements with
respect to the transactions contemplated hereby and prior to making any filings
with any Governmental Entity or with the NYSE or the NASD with respect thereto.
6.11 Benefit Plans. (a) At or as promptly as practicable following the
Effective Time, the Surviving Corporation and its subsidiaries will adopt
employee benefit plans (including, without limitation, severance plans) covering
persons who become and remain employees of the Surviving Corporation or its
subsidiaries and who were immediately prior to the Effective Time employees of
Dime or its subsidiaries (the "Former Dime Employees") or employees of ▇▇▇▇▇▇ or
its subsidiaries (the "Former ▇▇▇▇▇▇ Employees") or will amend existing plans to
provide coverage for Former Dime Employees and Former ▇▇▇▇▇▇ Employees. It is
the express understanding and intention of the parties that no Former Dime
Employee or Former ▇▇▇▇▇▇ Employee or other person shall be deemed to be a third
party beneficiary, or have or acquire any right to enforce the provisions, of
this Section 6.11(a), and that nothing in this Agreement shall be deemed to
constitute a Plan or an amendment to a Plan.
(b) Each of Dime and ▇▇▇▇▇▇ agrees, with respect to any Pension Plans
maintained by them or any of their subsidiaries with respect to which the
"remedial amendment period" described in Revenue Procedure 99-23, 1999-16 I.R.B.
5 (4/19/99), and any subsequent pronouncement by the Internal Revenue Service
extending or modifying the remedial amendment period as so described, ends prior
to the Closing Date and with respect to any amendments to such plans required to
be adopted before the end of such remedial amendment period, that to the extent
a determination letter with respect to the qualification of such Pension Plan or
Plans under the Internal Revenue Code reflecting such amendments has not been
obtained, an application for such a letter shall be filed with the Internal
Revenue Service on or before the last day of such remedial amendment period.
6.12 Expenses. Each of the parties shall bear and pay all costs and
expenses incurred by it or on its behalf in connection with the transactions
contemplated hereunder, including fees and expenses of its own financial or
other consultants, investment bankers, accountants and counsel, except that Dime
and ▇▇▇▇▇▇ each shall bear and pay one-half of the following expenses: (a) the
costs (excluding the fees and disbursements of counsel, financial advisors and
accountants) incurred in connection with the preparation (including copying and
printing and distribution) of the Registration Statement, the Joint Proxy
Statement and applications to Governmental Entities for the approval of the
Merger and (b) all listing, filing or registration fees, including, without
limitation, fees paid for filing the Registration Statement with the SEC and
fees paid for filings with Governmental Entities.
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6.13 Indemnification; Directors' and Officers' Insurance. (a) Each of
Dime and ▇▇▇▇▇▇ agrees that, from and after the Effective Time, the Surviving
Corporation will indemnify and hold harmless each present and former director
and officer of Dime, ▇▇▇▇▇▇ and their respective subsidiaries, determined as of
the Effective Time (the "Indemnified Parties"), against any costs or expenses
(including reasonable attorneys' fees), judgments, fines, losses, claims,
damages or liabilities (collectively, "Costs") incurred in connection with any
claim, action, suit, proceeding or investigation, whether civil, criminal,
administrative or investigative, arising out of or pertaining to matters
existing or occurring at or prior to the Effective Time, whether asserted or
claimed prior to, at or after the Effective Time, to the fullest extent that
Dime, ▇▇▇▇▇▇ or such subsidiary would have been permitted under applicable law
of the jurisdiction of its incorporation and the certificate of incorporation or
by-laws of Dime, ▇▇▇▇▇▇ or such subsidiary in effect on the date hereof to
indemnify such person (and the Surviving Corporation shall also advance expenses
as incurred to the fullest extent permitted under applicable law; provided that
the person to whom expenses are advanced provides an undertaking to repay such
advances if it is ultimately determined that such person is not entitled to
indemnification).
(b) To the extent that paragraph (a) shall not serve to indemnify and
hold harmless an Indemnified Party, for a period of six years after the
Effective Time, each of Dime and ▇▇▇▇▇▇ agrees that the Surviving Corporation
shall, subject to the terms set forth herein, indemnify and hold harmless, to
the fullest extent permitted under applicable law (and the Surviving Corporation
shall also advance expenses as incurred to the fullest extent permitted under
applicable law, provided that the person to whom expenses are advanced provides
an undertaking to repay such advances if it is ultimately determined that such
person is not entitled to indemnification), each Indemnified Party against any
Costs incurred in connection with any claim, action, suit, proceeding or
investigation, whether civil, criminal, administrative or investigative, arising
out of or pertaining to the transactions contemplated by this Agreement. In the
event any claim or claims are asserted or made within such six-year period, all
rights to indemnification in respect of any such claim or claims shall continue
until final disposition of any and all such claims.
(c) For a period of six years from the Effective Time, the Surviving
Corporation shall provide that portion of directors' and officers' liability
insurance that serves to reimburse the present and former officers and directors
of ▇▇▇▇▇▇ or any of its subsidiaries (determined as of the Effective Time) with
respect to claims against such directors and officers arising from facts or
events which occurred before the Effective Time, which insurance shall contain
at least the same coverage and amounts, and contain terms and conditions no less
advantageous, as that coverage currently provided by ▇▇▇▇▇▇.
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(d) Any Indemnified Party wishing to claim indemnification under
Section 6.13(a) or (b), upon learning of any such claim, action, suit,
proceeding or investigation, shall promptly notify the Surviving Corporation
thereof, but the failure to so notify shall not relieve the Surviving
Corporation of any liability it may have to such Indemnified Party if such
failure does not materially prejudice the Surviving Corporation. In the event of
any such claim, action, suit, proceeding or investigation (whether arising
before or after the Effective Time), the Surviving Corporation shall have the
right to assume the defense thereof and the Surviving Corporation shall not be
liable to such Indemnified Parties for any legal expenses of other counsel or
any other expenses subsequently incurred by such Indemnified Parties in
connection with the defense thereof, except that, if the Surviving Corporation
elects not to assume such defense or counsel for the Indemnified Parties advises
that there are issues which raise conflicts of interest between the Surviving
Corporation and the Indemnified Parties, the Indemnified Parties may retain
counsel satisfactory to them, and the Surviving Corporation shall pay all
reasonable fees and expenses of such counsel for the Indemnified Parties
promptly as statements therefor are received. If such indemnity is not available
with respect to any Indemnified Party, then the Surviving Corporation and the
Indemnified Party shall contribute to the amount payable in such proportion as
is appropriate to reflect relative faults and benefits.
6.14 Antitakeover Provisions. If any "business combination",
"moratorium", "control share" or other state antitakeover statute or regulation
(collectively, "Antitakeover Provisions") may become applicable to the transac-
tions contemplated hereby, each of Dime and ▇▇▇▇▇▇ and the members of their
respective Boards of Directors will grant such approvals and take such actions
as are necessary so that the transactions contemplated by this Agreement may be
consummated as promptly as practicable on the terms contemplated hereby and
otherwise act to eliminate or minimize the effects of any Antitakeover Provision
on any of the transactions contemplated by this Agreement.
6.15 Affiliate Agreements. (a) As soon as practicable after the date
hereof, Dime shall identify to ▇▇▇▇▇▇ and ▇▇▇▇▇▇ shall identify to Dime all
persons who are at the date hereof (or at another reasonably proximate date)
possible "affiliates" of Dime or ▇▇▇▇▇▇, respectively, as that term is used in
paragraphs (c) and (d) of Rule 145 under the Securities Act and/or Accounting
Series Releases 130 and 135, as amended, of the SEC ("Affiliates"). Each of Dime
and ▇▇▇▇▇▇ shall use their best efforts to obtain a written agreement in the
form of Annex 4(a) (for Affiliates of ▇▇▇▇▇▇) or 4(b) (for Affiliates of Dime)
from each person who is so identified as a possible Affiliate and shall deliver
copies of such written agreements to the other party as soon as practicable.
(b) As soon as practicable after the date of the Dime Meeting or ▇▇▇▇▇▇
Meeting, as applicable, Dime shall identify to ▇▇▇▇▇▇ and ▇▇▇▇▇▇ shall identify
to Dime all persons who were, at the time of the Dime Meeting or the ▇▇▇▇▇▇
Meeting, possible Affiliates of Dime and ▇▇▇▇▇▇, respectively, and
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who were not previously identified in accordance with Section 6.15(a). Each of
Dime and ▇▇▇▇▇▇ shall use their best efforts to obtain a written agreement in
the form of Annex 4(a) or 4(b), as the case may be, from each person who is so
identified and shall deliver copies of such written agreements to the other
party as soon as practicable.
6.16 Stock Exchange Listing. The parties agree to use all reasonable
efforts to cause to be listed on the NYSE, subject to official notice of
issuance, the shares of Surviving Corporation Common Stock to be issued in the
Merger.
6.17 Efforts to Consummate. On the terms and subject to the conditions
of this Agreement, each of Dime and ▇▇▇▇▇▇ agrees to use reasonable efforts to
take, or cause to be taken, all actions, and to do, or cause to be done, all
things necessary, proper or advisable to consummate and make effective, as soon
as practicable after the date of this Agreement, the transactions contemplated
hereby, including, without limitation, using reasonable efforts to lift or
rescind any injunction or restraining order or other order adversely affecting
the ability of the parties to consummate the transactions contemplated hereby.
6.18 Reports. Each of Dime and ▇▇▇▇▇▇ agrees to file, and to cause its
respective subsidiaries to file, all reports required to be filed with all
Governmental Entities pursuant to the Securities Laws or Federal or state
banking laws between the date of this Agreement and the Effective Time, and to
deliver to the other party copies of all such reports promptly after the same
are filed.
6.19 Accounting and Tax Treatment. Neither Dime nor ▇▇▇▇▇▇ will take,
cause or to the best of its ability permit to be taken any action that would
adversely affect the qualification of the Merger for pooling-of-interests
accounting treatment or the qualification of the Merger as a "reorganization"
within the meaning of Section 368 of the Internal Revenue Code; provided, that
nothing in this Section 6.19 shall preclude either party from exercising its
respective rights under the Stock Option Agreements.
6.20 Assumptions. The parties agree to take all reasonable action for
the Surviving Corporation to assume any guaranties or indentures to which ▇▇▇▇▇▇
is currently a party, including, without limitation, guaranties and indentures
associated with the ▇▇▇▇▇▇-guarantied mandatorily redeemable preferred capital
securities, Series B, of ▇▇▇▇▇▇ Capital Trust I and ▇▇▇▇▇▇ Capital Trust II
which hold solely junior subordinated debentures of ▇▇▇▇▇▇.
6.21 Bank Combination and Governance. The parties agree to take all
reasonable actions necessary prior to the Effective Time to cause the federal
savings bank subsidiary of Dime and New Jersey state-chartered
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commercial bank subsidiary of ▇▇▇▇▇▇ to be combined, in a manner to be
determined, effective as soon as possible after the Effective Time, as the
Subsidiary Bank, so that (a) the Subsidiary Bank is a New Jersey state-chartered
commercial bank, (b) the Board of Directors and executive officers of the
Subsidiary Bank shall be the same persons in the same positions as the Board of
Directors and executive officers of the Surviving Corporation, and (c) the
charter and by-laws of the Subsidiary Bank shall contain those provisions (or
other provisions of similar effect) provided for in Article III hereof with
respect to the Surviving Corporation. Notwithstanding the previous sentence, the
Surviving Corporation shall have the right to retain a federally-chartered
savings bank as one of its depository institution subsidiaries.
ARTICLE VII
CONDITIONS
7.1 Conditions to Each Party's Obligation to Effect the Merger. The
respective obligation of each of Dime and ▇▇▇▇▇▇ to consummate the Merger is
subject to the fulfillment or written waiver by Dime and ▇▇▇▇▇▇ prior to the
Effective Time of each of the following conditions:
(a) Stockholder Approval. The agreement of merger contained in this
Agreement shall have been duly adopted by the holders of Dime Common Stock
and the holders of ▇▇▇▇▇▇ Common Stock in accordance with Sections 251 and
252 of the DGCL and Section 14A: 10-3 of the NJBCA, as the case may be, and
each such stockholder approval shall be in accordance with other applicable
law.
(b) Governmental and Regulatory Consents. All approvals and
authorizations of, filings and registrations with, and notifications to,
all Governmental Entities required for the consummation of the Merger and
for the prevention of any termination of any material right, privilege,
license or agreement of either Dime or ▇▇▇▇▇▇ or their respective
subsidiaries shall have been obtained or made and shall be in full force
and effect and all waiting periods required by law shall have expired;
provided, however, that none of the preceding shall be deemed obtained or
made if it shall be conditioned or restricted in a manner that would result
in a Material Adverse Effect on the Surviving Corporation.
(c) Third Party Consents. All consents or approvals of all persons
(other than Governmental Entities) required for or in connection with the
execution, delivery and performance of this Agreement and the consummation
of the Merger shall have been obtained and shall be in full force and
effect, unless the failure to obtain any such consent or approval is not
reasonably likely to have, individually or in the aggregate, a Material
Adverse Effect on the Surviving Corporation.
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(d) Litigation. No Governmental Entity of competent jurisdiction shall
have enacted, issued, promulgated, enforced or entered any statute, rule,
regulation, judgment, decree, injunction or other order (whether temporary,
preliminary or permanent) that prohibits consummation of the transactions
contemplated by this Agreement.
(e) Registration Statement. The Registration Statement shall have
become effective under the Securities Act and no stop order suspending the
effectiveness of the Registration Statement shall have been issued and no
proceedings for that purpose shall have been initiated or threatened by the
SEC. All permits and other authorizations under the Securities Laws and
other authorizations necessary to consummate the transactions contemplated
hereby and to issue the shares of Surviving Corporation Common Stock to be
issued in the Merger shall have been received and be in full force and
effect.
(f) Listing. The shares of Surviving Corporation Common Stock to be
issued in the Merger shall have been approved for listing on the NYSE,
subject to official notice of issuance.
(g) Accountants' Pooling Letter. Each of Dime and ▇▇▇▇▇▇ shall have
received a letter, dated as of the Effective Time, from KPMG LLP and ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, their respective independent auditors, to the effect that the
Merger will qualify for pooling-of-interests accounting treatment under
Accounting Principles Board Opinion No. 16 and SEC Accounting Series
Releases 130 and 135, as amended, if consummated in accordance with this
Agreement.
(h) Employment Agreements. Unless ▇▇. ▇▇▇▇▇▇▇ or ▇▇. ▇▇▇▇ is unable or
unwilling to serve in the capacity or capacities described therein, the
Employment Agreement for each of ▇▇. ▇▇▇▇▇▇▇ and ▇▇. ▇▇▇▇, respectively,
shall be in full force and effect.
7.2 Conditions to Obligation of ▇▇▇▇▇▇. The obligation of ▇▇▇▇▇▇ to
consummate the Merger is also subject to the fulfillment or written waiver by
▇▇▇▇▇▇ prior to the Effective Time of each of the following conditions:
(a) Representations and Warranties. The representations and warranties
of Dime set forth in this Agreement shall be true and correct as though
made on and as of the Closing Date (except that representations and
warranties that by their terms speak as of the date of this Agreement or
some other date shall be true and correct as of such date), and ▇▇▇▇▇▇
shall have received a certificate, dated the Closing Date, signed on behalf
of Dime by the Chief Executive Officer and the Chief Financial Officer of
Dime to such effect.
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(b) Performance of Obligations of Dime. Dime shall have performed in
all material respects all obligations required to be performed by it under
this Agreement at or prior to the Closing Date, and ▇▇▇▇▇▇ shall have
received a certificate, dated the Closing Date, signed on behalf of Dime by
the Chief Executive Officer and the Chief Financial Officer of Dime to such
effect.
(c) Opinion of Counsel. ▇▇▇▇▇▇ shall have received an opinion, dated
the Closing Date, of ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, reasonably satisfactory to
▇▇▇▇▇▇, to the effect that the shares of Surviving Corporation Common Stock
to be issued in the Merger, when issued in accordance with the terms
hereof, will be duly authorized, validly issued, fully paid and
nonassessable.
(d) Opinion of Tax Counsel. ▇▇▇▇▇▇ shall have received an opinion
(based on customary assumptions and representations) of Pitney, ▇▇▇▇▇▇,
▇▇▇▇ & ▇▇▇▇▇, counsel to ▇▇▇▇▇▇, dated the Closing Date, to the effect that
(1) the Merger is a "reorganization" within the meaning of Section 368(a)
of the Internal Revenue Code, (2) Dime and ▇▇▇▇▇▇ are parties to such
"reorganization" and (3) the exchange in the Merger of shares of ▇▇▇▇▇▇
Common Stock for shares of Surviving Corporation Common Stock will not
result in the recognition of income, gain or loss to Dime, ▇▇▇▇▇▇ or the
stockholders of ▇▇▇▇▇▇ in each case for federal income tax purposes
(subject to customary exceptions and except to the extent of any cash paid
in lieu of fractional shares or any state and local transfer taxes paid on
behalf of a stockholder).
(e) Accountants' Letters. ▇▇▇▇▇▇ and its directors and officers who
sign the Registration Statement shall have received the letters referred to
in Section 6.7 from KPMG LLP, as Dime's independent auditors.
7.3 Conditions to Obligation of Dime. The obligation of Dime to
consummate the Merger is also subject to the fulfillment or written waiver by
Dime prior to the Effective Time of each of the following conditions:
(a) Representations and Warranties. The representations and warranties
of ▇▇▇▇▇▇ set forth in this Agreement shall be true and correct as though
made on and as of the Closing Date (except that representations and
warranties that by their terms speak as of the date of this Agreement or
some other date shall be true and correct as of such date) and Dime shall
have received a certificate, dated the Closing Date, signed on behalf of
▇▇▇▇▇▇ by the Chief Executive Officer and the Chief Financial Officer of
▇▇▇▇▇▇ to such effect.
(b) Performance of Obligations of ▇▇▇▇▇▇. ▇▇▇▇▇▇ shall have performed
in all material respects all obligations required to be per-
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formed by it under this Agreement at or prior to the Closing Date, and
Dime shall have received a certificate, dated the Closing Date, signed on
behalf of ▇▇▇▇▇▇ by the Chief Executive Officer and the Chief Financial
Officer of ▇▇▇▇▇▇ to such effect.
(c) Opinion of Tax Counsel. Dime shall have received an opinion (based
on customary assumptions and representations) of ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇,
counsel to Dime, dated the Closing Date, to the effect that (1) the Merger
is a "reorganization" within the meaning of Section 368(a) of the Internal
Revenue Code and (2) Dime and ▇▇▇▇▇▇ are parties to such "reorganization".
(d) Accountants' Letters. Dime and its directors and officers who sign
the Registration Statement shall have received the letters referred to in
Section 6.7 from ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, as ▇▇▇▇▇▇'▇ independent auditors.
ARTICLE VIII
TERMINATION
8.1 Termination by Mutual Consent. This Agreement may be terminated and
the Merger may be abandoned at any time prior to the Effective Time, before or
after the approval by the stockholders of Dime and ▇▇▇▇▇▇, respectively, by the
mutual agreement of Dime and ▇▇▇▇▇▇, approved by their respective Boards of
Directors.
8.2 Termination by Either Dime or ▇▇▇▇▇▇. This Agreement may be
terminated and the Merger may be abandoned by action of the Board of Directors
of either Dime or ▇▇▇▇▇▇ if the Merger shall not have been consummated by June
30, 2000 or any approval or authorization of any Governmental Entity, the lack
of which would result in the failure to satisfy the closing condition set forth
in Section 7.1(b), shall have been denied by such Governmental Entity or such
Governmental Entity shall have requested the withdrawal of any application
therefor or indicated an intention to deny, or impose a condition of a type
referred to in the proviso to Section 7.1(b) with respect to, such approval or
authorization (provided, that the terminating party is not then in material
breach of its obligations under Section 6.4).
8.3 Termination by ▇▇▇▇▇▇. This Agreement may be terminated and the
Merger may be abandoned at any time prior to the Effective Time by action of the
Board of Directors of ▇▇▇▇▇▇ (a) before or after the adoption by stockholders of
▇▇▇▇▇▇ referred to in Section 7.1(a), if Dime shall have breached any
representation, warranty, covenant or agreement contained herein that would
result in the failure to satisfy the closing condition set forth in Section
7.2(a) or 7.2(b) and such breach cannot be or has not been cured within 30 days
after the giving of a written notice to Dime of such breach or
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(b) before the adoption and approval by stockholders of ▇▇▇▇▇▇ referred to in
Section 7.1(a), if the Board of Directors of Dime shall have failed to recommend
to its stockholders the adoption of the plan of merger contained in this
Agreement.
8.4 Termination by Dime. This Agreement may be terminated and the
Merger may be abandoned at any time prior to the Effective Time by action of the
Board of Directors of Dime (a) before or after the approval by the stockholders
of Dime referred to in Section 7.1(a), if ▇▇▇▇▇▇ shall have breached any
representation, warranty, covenant or agreement contained herein that would
result in the failure to satisfy the closing condition set forth in Section
7.3(a) or 7.3(b) and such breach cannot be or has not been cured within 30 days
after the giving of a written notice to ▇▇▇▇▇▇ of such breach or (b) before the
adoption by stockholders of Dime referred to in Section 7.1(a), if the Board of
Directors of ▇▇▇▇▇▇ shall have failed to recommend to its stockholders the
adoption of the agreement of merger contained in this Agreement.
8.5 Effect of Termination and Abandonment. In the event of termination
of this Agreement and the abandonment of the Merger pursuant to this Article
VIII, no party to this Agreement shall have any liability or further obligation
to any other party hereunder except (a) as set forth in Section 9.1, (b) each of
the Stock Option Agreements shall be governed by its own terms as to termination
and (c) termination will not relieve a breaching party from liability for any
breach directly or indirectly giving rise to such termination.
ARTICLE IX
MISCELLANEOUS
9.1 Survival. Only those agreements and covenants of the parties that
by their express terms apply in whole or in part after the Effective Time shall
survive the Effective Time. All other representations, warranties, agreements
and covenants shall be deemed only to be conditions of the Merger and shall not
survive the Effective Time. If the Merger shall be abandoned and this Agreement
terminated, the provisions of Section 8.5 shall apply and the agreements of the
parties in Sections 6.8 (excluding the first sentence thereof), 6.10 and 6.12
shall survive such abandonment.
9.2 Modification or Amendment. (a) Subject to the applicable provisions
of the DGCL and the NJBCA, at any time prior to the Closing Date, the parties
hereto may modify or amend this Agreement, by written agreement executed and
delivered by duly authorized officers of the respective parties.
(b) At any time prior to the Effective Time, Dime and ▇▇▇▇▇▇ may enter
into an amendment to this Agreement in accordance with Section 9.2(a)
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in order to modify the structure of the Merger or the other transactions
contemplated hereby, or the manner of effecting such transactions; provided that
after the adoption of the agreement of merger contained in this Agreement by the
stockholders of Dime and ▇▇▇▇▇▇ referred to in Section 7.1(a), no such amendment
shall adversely affect the consideration to be received by the stockholders of
Dime or ▇▇▇▇▇▇, respectively, unless such amendment is approved by such
stockholders of Dime or ▇▇▇▇▇▇, respectively, prior to the Effective Time.
9.3 Waiver of Conditions. The conditions to each party's obligation to
consummate the Merger are for the sole benefit of such party and may be waived
by such party in whole or in part to the extent permitted by applicable law. No
waiver shall be effective unless it is in a writing signed by a duly authorized
officer of the waiving party that makes express reference to the provision or
provisions subject to such waiver.
9.4 Counterparts and Facsimile. For the convenience of the parties
hereto, this Agreement may be executed in any number of separate counterparts,
each such counterpart being deemed to be an original instrument, and all such
counterparts shall together constitute the same agreement. Executed signature
pages to this Agreement may be delivered by facsimile and such facsimiles shall
be deemed as sufficient as if actual signature pages had been delivered.
9.5 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE
AND TO BE PERFORMED ENTIRELY WITHIN SUCH STATE.
9.6 Notices. Any notice, request, instruction or other document to be
given hereunder by any party to the other shall be in writing and shall be
deemed to have been duly given (i) on the date of delivery if delivered person-
ally, or by telecopy or telefacsimile, upon confirmation of receipt, (ii) on the
first business day following the date of dispatch if delivered by a recognized
next-day courier service, or (iii) on the third business day following the date
of mailing if delivered by registered or certified mail, return receipt
requested, postage prepaid. All notices hereunder shall be delivered as set
forth below, or pursuant to such other instructions as may be designated in
writing by the party to receive such notice.
(a) If to ▇▇▇▇▇▇:
▇▇▇▇▇▇ United Bancorp
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chairman & Chief Executive Officer
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
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with copies to:
▇▇▇▇▇▇ United Bancorp
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
and
Pitney, ▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
(b) If to Dime:
Dime Bancorp, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Chief Executive Officer
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
with copies to:
Dime Bancorp, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
and
▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
9.7 Entire Agreement, Etc. (a) This Agreement (including the Annexes
hereto and the Disclosure Letters), the Stock Option Agreements and the
Confidentiality Agreements constitute the entire agreement, and supersede all
other prior agreements, understandings, representations and warranties, both
written and oral, between the parties, with respect to the subject matter
hereof, and (b) this Agreement shall not be assignable by operation of law or
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otherwise (any attempted assignment in contravention hereof being null and
void).
9.8 Definition of "subsidiary"; Covenants with Respect to Subsidi-
aries. (a) When a reference is made in this Agreement to a subsidiary of a
person, the term "subsidiary" means those corporations, banks, savings banks,
associations and other entities of which such person owns or controls 25% or
more of the outstanding equity securities either directly or through an unbroken
chain of entities as to each of which 25% or more of the outstanding equity
securities is owned directly or indirectly by its parent; provided however,
that, except for purposes of Section 5.3(q), there shall not be included any
such entity to the extent that the equity securities of such entity were
acquired in satisfaction of a debt previously contracted in good faith or are
owned or controlled in a bona fide fiduciary capacity.
(b) Insofar as any provision of this Agreement shall require a
subsidiary to take or omit to take any action, such provision shall be deemed a
covenant by Dime or ▇▇▇▇▇▇, as the case may be, to cause such action or omission
to occur.
9.9 Captions. The Article, Section and paragraph captions herein are
for convenience of reference only, do not constitute part of this Agreement and
shall not be deemed to limit or otherwise affect any of the provisions hereof.
9.10 Severability. If any provision of this Agreement or the
application thereof to any person (including, without limitation, the officers
and directors of Dime and ▇▇▇▇▇▇) or circumstance is determined by a court of
competent jurisdiction to be invalid, void or unenforceable, the remaining
provisions hereof, or the application of such provision to persons or circum
stances other than those as to which it has been held invalid or unenforceable,
shall remain in full force and effect and shall in no way be affected, impaired
or invalidated thereby, so long as the economic or legal substance of the
transactions contemplated hereby is not affected in any manner materially
adverse to any party. Upon such determination, the parties shall negotiate in
good faith in an effort to agree upon a suitable and equitable substitute
provision to effect the original intent of the parties. Prior to the termination
of this Agreement in accordance with its terms, the absence of adoption by the
stockholders of a party hereto shall not render invalid or inoperative any
provision hereof not required to be contained in the agreement of merger to be
adopted by such stockholders pursuant to Sections 251 and 252 of the DGCL, or
Section 14A: 10-3 of the NJBCA, as the case may be, and the certificate of
incorporation and by-laws of such party.
9.11 No Third Party Beneficiaries. Nothing contained in this Agreement,
expressed or implied, is intended to confer upon any person or entity other than
the parties hereto, any benefit right or remedies except that
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the provisions of Section 4.3 shall inure to the benefit of the holders of stock
options and Article III (subject to the limitations set forth in such Article
III) and Section 6.13 shall inure to the benefit of the persons referred to
therein.
[THE NEXT PAGE IS A SIGNATURE PAGE]
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IN WITNESS WHEREOF, this Agreement has been duly executed and delivered
by the duly authorized officers of the parties hereto as of the date first
hereinabove written.
▇▇▇▇▇▇ UNITED BANCORP
By: /s/▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President and Chief
Executive Officer
DIME BANCORP, INC.
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇
Title: Chief Executive Officer