Exhibit 2.1
AGREEMENT AND PLAN OF MERGER
Agreement and Plan of Merger ("Agreement") as of September
22, 2002, between Acadiana Bancshares, Inc. ("XXX"); and
IBERIABANK Corporation, a Louisiana corporation ("IBKC").
RECITALS
1. Each of XXX and IBKC is a registered bank holding company
under the BHC Act (such term and other capitalized terms used in
this Agreement are used as defined in Section I).
2. The Board of Directors of each of XXX and IBKC believes that
the transactions described in this Agreement are in the best
interests of such Party and its shareholders.
3. By virtue of the reorganization that is effectuated by this
Agreement, (a) XXX will be merged into a wholly-owned subsidiary
of IBKC, and (b) as a result of the foregoing Merger, except as
provided in this Agreement, the then outstanding shares of XXX
Common Stock will be converted into shares of IBKC Common Stock
and cash.
4. The Merger is subject to prior approval of, among others,
the shareholders of XXX and the Federal Reserve, and the prior
satisfaction of certain other conditions set forth in this
Agreement.
5. XXX has simultaneously executed and delivered its Stock
Option Agreement to IBKC, by which XXX grants to IBKC an option
to purchase shares of XXX Common Stock under certain
circumstances described therein.
6. The Parties intend that the reorganization contemplated by
this Agreement qualify for federal income tax purposes as a tax-
free reorganization under the Internal Revenue Code.
AGREEMENT
In consideration of the foregoing and of the mutual
warranties, representations, covenants and agreements set forth
herein, and for other good and valuable consideration the receipt
and sufficiency of which are acknowledged, the parties to this
Agreement agree as follows:
SECTION I.
DEFINITIONS
Except as may otherwise be provided in this Agreement, the
capitalized terms set forth below shall have the following
respective meanings, in their singular or plural forms as
applicable:
1.1 "Acquisition Proposal" - any proposal or offer with respect
to any of the following (other than the transactions contemplated
hereunder) involving XXX or any of its Subsidiaries: (i) any
merger, consolidation, share exchange, business combination or
other similar transaction; (ii) any sale, lease, exchange,
mortgage, pledge, transfer or other disposition of 20% or more of
its consolidated assets in a single transaction or series of
transactions; (iii) any tender offer or exchange offer for 20% or
more of the outstanding shares of its capital stock or the filing
of a registration statement under the Securities Act in
connection therewith; or (iv) any public announcement to engage
in any of the foregoing.
1.2 "Acquisition Transaction" - with respect to each Party, any
of (i) a merger, consolidation or share exchange, or any similar
transaction (other than the Merger), (ii) a purchase, lease or
other acquisition of all or substantially all the assets of such
Party or any significant subsidiary (as defined in Rule 1.02 of
Regulation S-X of the SEC) (a "Significant Subsidiary") of such
Party, (iii) a purchase or other acquisition of beneficial
ownership by any person or "group" (as such term is defined in
Section 13(d)(3) of the 0000 Xxx) (including by way of merger,
consolidation, share exchange or otherwise) of securities
representing 20% or more of the voting power of such Party or any
Significant Subsidiary of such Party, but excluding the
acquisition of beneficial ownership by any employee benefit plan
maintained or sponsored by such Party, (iv) a tender or exchange
offer to acquire securities representing 20% or more of the
voting power of such Party, (v) a public proxy or consent
solicitation made to shareholders of such Party seeking proxies
in opposition to any proposal that has been recommended by the
Board of Directors of such Party, (vi) the filing of an
application or notice with the Federal Reserve or other federal
or state bank regulatory authority (which application has been
accepted for processing) seeking approval to engage in one or
more of the transactions referenced in clauses (i) through (iv)
above, or (vii) the making of a bona fide proposal to such Party
or its shareholders by public announcement or written
communication that is or becomes the subject of public disclosure
to engage
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in one or more of the transactions or events referenced in clauses
(i) through (v) above.
1.3 "Agreement" - this Agreement and Plan of Merger.
1.4 "XXX Common Stock" - the Common Stock of XXX.
1.5 "XXX Companies" - collectively, XXX and all XXX Subsidiaries.
1.6 "XXX ESOP" - the XXX Employee Stock Ownership Plan.
1.7 "XXX 401(k) Plan" - the LBA Bank 401(k) Savings Plan.
1.8 "XXX Stock Option Plan" - the Stock Option Plan approved by
the XXX Board of Directors in 1996.
1.9 "XXX Subsidiaries" - the Subsidiaries of XXX, which shall
include LBA Bank and the other XXX Subsidiaries described in
Section 5.3 of this Agreement, and any corporation, bank, savings
bank, association or other entity that becomes a Subsidiary of
XXX prior to the Effective Time.
1.10 "BCL" - the Louisiana Business Corporation Law.
1.11 "BHC Act" - the federal Bank Holding Company Act of 1956.
1.12 "Business Day" - Monday through Friday of each week, except
a legal holiday recognized as such by the U.S. Government or any
day on which banking institutions in the State of Louisiana are
authorized or obligated to close.
1.13 "Certificates" - the certificates representing shares of XXX
Common Stock on or prior to the Effective Time.
1.14 "Closing" - the closing of the transactions contemplated
hereunder as described in Section 3.1 of this Agreement.
1.15 "Code" - the Internal Revenue Code of 1986.
1.16 "Dissenters Shares" - shares of XXX Common Stock as to which
dissenters rights have been perfected and not withdrawn or
otherwise forfeited under Section 131 of the BCL.
1.17 "Effective Time" - the date and time at which the Merger
becomes effective, as described in Section 3.2 of this Agreement.
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1.18 "ERISA" - the Employee Retirement Income Security Act of
1974.
1.19 "Exchange Agent" - IBKC's stock transfer agent or such
other third party experienced in the stock transfer business
reasonably acceptable to XXX which shall act as the exchange
agent pursuant to Section 2.3 hereof.
1.20 "Exchange Ratio" - the quotient, rounded to the nearest ten-
thousandth, obtained by dividing $31.50 by the Market Value,
provided that (i) if the Market Value is greater than $46.00, the
Exchange Ratio shall be fixed at 0.6848 (the "Maximum Stock
Ratio"), and (ii) if the Market Value is less than $34.00, the
Exchange Ratio will be fixed at 0.9265 (the "Minimum Stock
Ratio"), provided, however, that the Exchange Ratio shall be
adjusted in accordance with Section 2.3(a)(i) hereof in the event
of a Stock Reduction and/or pursuant to Section 2.3(c) hereof.
1.21 "Fee Adjustment Amount" - the amount, if any, by which the
legal fees incurred by XXX in connection with the negotiation and
review of this Agreement and consummation of the transactions
contemplated hereby exceed $180,000 (the "Threshold").
1.22 "Financial Statements" - (i) the audited consolidated
balance sheets (including related notes and schedules, if any) of
a Party as of December 31, 2001 and 2000, and the related
consolidated statements of income, changes in stockholders'
equity, and cash flows (including related notes and schedules, if
any) for the respective periods then ended, as filed by such
Party in SEC Documents and (ii) the unaudited consolidated
balance sheets of such Party (including related notes and
schedules, if any) and related consolidated statements of income,
changes in stockholders' equity, and cash flows (including
related notes and schedules, if any) included in SEC Documents
filed by such Party with respect to periods ended subsequent to
December 31, 2001.
1.23 "Federal Reserve" - the Board of Governors of the Federal
Reserve System.
1.24 "GAAP" - generally accepted accounting principles.
1.25 "IBAC" - IBERIABANK Acquisition Corporation, a wholly-owned
subsidiary of IBKC.
1.26 "IBERIABANK" - IBERIABANK, a wholly-owned subsidiary of
IBKC.
1.27 "IBKC Common Stock" - the Common Stock of IBKC.
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1.28 "IBKC Companies" - collectively, IBKC and all IBKC
Subsidiaries.
1.29 "IBKC Stock Incentive Plan" - IBKC's Stock Incentive Plan.
1.30 "IBKC Subsidiaries" - the Subsidiaries of IBKC, which shall
include the IBKC Subsidiaries described in Section 5.3 of this
Agreement and any corporation, bank, savings bank, association or
other entity that becomes or is acquired as a Subsidiary of IBKC
in the future.
1.31 "LBA Bank" - LBA Savings Bank, a Subsidiary of XXX.
1.32 "Market Value" - the average of the closing sales prices of
a share of IBKC Common Stock on the NASDAQ Stock Market for the
first 10 trading days of the month in which the Effective Time
occurs ("The Measurement Period"). If IBKC changes the number of
shares of IBKC Common Stock issued and outstanding as a result of
any stock split, stock dividend or other similar change in IBKC's
capitalization, or if a distribution of securities is made in
respect of the IBKC Common Stock as a result of any dividend
(other than regular quarterly cash dividends), spinoff or other
reorganization in which IBKC Common Stock is not changed into or
exchanged for a different kind of securities, and in any such
case the record date is before the Effective Time and the ex-
dividend or ex-distribution date is subsequent to, or during, the
period during which Market Value is determined such that such
event is not reflected in any one or more of the closing sales
prices used to determine Market Value, the appropriate adjustment
shall be made in such closing sales price or prices so as to
reflect such change.
1.33 "Material Adverse Effect" - when used in connection with
XXX or IBKC, means any change, effect, event, occurrence or state
of facts that (a) is, or would reasonably be expected to be,
materially adverse to the business, financial condition or
results of operations of such Party and its Subsidiaries taken
as a whole, other than (i) any change, effect, event or
occurrence relating to the United States economy or financial or
securities in general, (ii) any change, effect, event or
occurrence relating to the banking and financial services
industry generally, including changes in the prevailing level or
interest rates, (iii) any change, effect, event or occurrence
relating to the announcement or performance of this Agreement and
the transactions contemplated hereby, (iv) with respect to XXX,
any change, effect, event or occurrence resulting from any action
or omission taken with the prior consent of IBKC, (v) any change
in banking, savings association or similar laws, rules or
regulations of general applicability or interpretations thereof
by courts or governmental authorities and (vi) any change in GAAP
or regulatory
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accounting requirements applicable to banks, savings banks or
their holding companies generally, or (b) materially and adversely
affects the ability of the Party to perform its obligations
hereunder or materially and adversely affects the timely
consummation of the transactions contemplated hereby.
1.34 "Merger Agreement" - the Joint Agreement of Merger,
substantially in the form attached hereto as Exhibit I, providing
for the Merger.
1.35 "Merger Parties" - collectively, IBKC, IBAC and XXX.
1.36 "Merger" - the merger of XXX into IBAC.
1.37 "1933 Act" - the Securities Act of 1933.
1.38 "1934 Act" - the Securities Exchange Act of 1934.
1.39 "Party" - either IBKC or XXX, and "Parties" - IBKC and XXX.
1.40 "Person" - any individual, bank, corporation, partnership,
association, joint stock company, business trust, limited
liability company or unincorporated association.
1.41 "Previously Disclosed" - with respect to a Party,
information in a disclosure schedule by such Party to the other
Party delivered to such other Party before or contemporaneously
with, the execution and delivery of this Agreement and accepted
by such other Party. "Previously Disclosed" shall also mean all
information about a Party that had been publicly disclosed in SEC
Documents filed by that Party before the date of this Agreement.
1.42 "Proxy Statement" - the proxy statement/prospectus used by
XXX to solicit the approval by its shareholders of the
transactions contemplated by this Agreement and the Merger
Agreement.
1.43 "Purchase Event" shall have the meaning given to such term
in the Stock Option Agreement.
1.44 "Registration Statement" - the Registration Statement on
Form S-4 (or other appropriate form) and all amendments and
supplements thereto filed with the SEC by IBKC under the 1933 Act
in connection with the transactions contemplated by this
Agreement.
1.45 "Regulatory Authorities" - collectively, the Federal
Reserve, the State Regulatory Commissioners and any other federal
or state banking, insurance,
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securities or other regulatory authority whose approval is necessary
to consummate the transactions contemplated by this Agreement.
1.46 "SEC" - the United States Securities and Exchange
Commission.
1.47 "SEC Documents" - all reports, proxy statements,
registration statements and other documents filed by a Party or
any of its Subsidiaries pursuant to the Securities Laws.
1.48 "Securities Laws" - the 1933 Act, the 1934 Act, the
Investment Company Act of 1940, the Investment Advisors Act of
1940, the Trust Indenture Act of 1939, and the rules and
regulations of the SEC under each of such Acts.
1.49 "Shareholders Meeting" - the meeting of the shareholders of
XXX to be held pursuant to Section 7.1 of this Agreement,
including any adjournments thereof.
1.50 "State Regulatory Commissioners" - any state banking,
insurance, securities or other regulatory authority whose
approval is necessary to consummate the transactions contemplated
by this Agreement, the Merger Agreement and the Stock Option
Agreement.
1.51 "Stock Option Agreement" - the Stock Option Agreement, in
the form attached hereto as Exhibit II, to be dated the date
hereof between XXX and IBKC.
1.52 "Subsidiaries" - all those corporations, banks, savings
banks, associations and other entities of which the Party in
question owns or controls 5% or more of the outstanding equity
securities either directly or through an unbroken chain of
entities as to each of which 5% or more of the outstanding equity
securities is owned directly or indirectly by such Party;
provided, however, there shall not be included any such entity
acquired in good faith through foreclosure, or any such entity to
the extent that the equity securities of such entity are owned or
controlled in a bona fide fiduciary capacity, through a small
business investment corporation or otherwise as an investment by
an entity that invests in unaffiliated companies in the ordinary
course of business.
1.53 "Superior Proposal" - means a bona fide written proposal
made by a Person other than XXX or IBKC which is (i) for a
merger, reorganization, consolidation, share exchange, business
combination, recapitalization, or similar transaction involving
such Party as a result of which the other party thereto or
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its stockholders will own 40% or more of the combined voting power
of the entity surviving or resulting from such transaction (or the
ultimate parent entity thereof), and (ii) is on terms which the
Board of Directors of such Party in good faith concludes
(following receipt of the advice of its financial advisors and
outside counsel which shall not be contrary to such conclusion),
taking into account, among other things, all legal, financial,
regulatory and other aspects of the proposal and the Person
making the proposal, (x) would, if consummated, result in a
transaction that is superior to its stockholders (in their
capacities as stockholders), from a financial point of view, than
the transactions contemplated by this Agreement and any
subsequent proposal submitted by IBKC and (y) is reasonably
capable of being completed in accordance with its terms
(including that any financing required to consummate the
transaction is reasonably likely to be obtained).
In Section V of this Agreement, the capitalized terms set
forth below shall have the following respective meanings, in
their singular or plural forms, as applicable:
1.54 "Warrantor" - IBKC or XXX, as the case may be.
1.55 "Warrantor Capital Stock" - the IBKC Capital Stock or the
XXX Common Stock, as the context shall require, which shall in
this and each of the following cases depend on whether the
Warrantor is IBKC or XXX and will correspond therewith.
1.56 "Warrantor Common Stock" - the IBKC Common Stock or the
XXX Common Stock, as the context shall require.
1.57 "Warrantor Companies" - the IBKC Companies or the XXX
Companies, as the context shall require.
1.58 "Warrantor Financial Statements" - the Financial Statements
of Warrantor.
1.59 "Warrantor Stock Option Plans" - the IBKC Stock Option Plans
or the XXX Stock Option Plan, as the context shall require.
1.60 "Warrantor Subsidiaries" - the Subsidiaries of Warrantor.
Other terms are defined as set forth herein below.
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SECTION II.
CERTAIN TRANSACTIONS AND TERMS OF MERGER
2.1 Execution of Stock Option Agreement. Simultaneously with
the execution of this Agreement and as a condition thereto, XXX
has approved the execution and delivery of the Stock Option
Agreement and has executed and delivered the Stock Option
Agreement.
2.2 Merger. Subject to the terms and conditions of this
Agreement, at the Effective Time, XXX will be merged into IBAC in
accordance with the Merger Agreement and Section 112 of the BCL.
2.3 Conversion of XXX Common Stock.
(a) Except for Dissenters Shares and as otherwise provided
herein, at the Effective Time each outstanding share of XXX
Common Stock will be converted into:
(i) a number of shares of IBKC Common Stock equal to the
Exchange Ratio, provided, however, that if the total amount of
shares of IBKC Common Stock to be issued in exchange for all
outstanding shares of XXX Common Stock pursuant hereto were to
exceed 19.9% of the issued and outstanding shares of IBKC Common
Stock immediately prior to the Effective Time, then the total
number of shares of IBKC Common Stock to be issued in exchange
for XXX Common Stock shall be reduced (a "Stock Reduction") to an
amount equal to 19.9% of the then outstanding shares of IBKC
Common Stock and the Exchange Ratio shall be appropriately
adjusted (the "Stock Consideration"); and
(ii) cash in an amount equal to $7.88 per share of XXX Common
Stock exchanged, subject to adjustment in the event of (A) any
Stock Reduction (in which event, the amount of cash to be
received by XXX shareholders shall be increased by an amount
equal to the number of shares by which the Stock Consideration is
reduced pursuant to Section 2.3(a)(i) hereof multiplied by the
Market Value), (B) any Fee Adjustment Amount, in which case,
unless waived by IBKC, the amount of cash to be received by XXX
shareholders shall be reduced by the quotient equal to the Fee
Adjustment Amount, if any, divided by the sum of 1,168,252, plus
the number of shares issued before the Effective Time pursuant to
the exercise of outstanding stock options and the number of
shares subject to options outstanding at the Effective Time,
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provided that fractions of a cent shall be disregarded, and/or
(C) an election of IBKC pursuant to Section 9.1(k) hereof (the
"Cash Consideration").
The Stock Consideration and the Cash Consideration shall be
referred to collectively as the "Merger Consideration".
(b) Shares of XXX Common Stock that are held either by an XXX
Company or any XXX Company Subsidiary (other than shares held in
a fiduciary capacity other than for XXX or any other XXX Company)
shall not be considered to be outstanding and shall be cancelled
(and not converted) by virtue of the Merger at the Effective Time
and without any further action by either Party.
(c) If, before the Effective Time, IBKC should split or combine
the IBKC Common Stock, or pay a stock dividend in IBKC Common
Stock, or otherwise change the IBKC Common Stock into any other
securities, or make any other dividend or distribution in respect
of the IBKC Common Stock (other than normal cash dividends as the
same may be adjusted from time to time in accordance with or not
in violation of this Agreement), then the Exchange Ratio will be
appropriately adjusted to reflect such split, combination,
dividend or other distribution or change.
(d) In lieu of issuing any fractional share of IBKC Common
Stock, each holder of XXX Common Stock who would otherwise be
entitled thereto, after aggregating into whole shares all
fractional shares of IBKC Common Stock to which such holder is
entitled by virtue of the Merger, upon surrender of the
Certificates, will receive cash equal to such fractional share
multiplied by the Market Value.
(e) After the Effective Time, each holder of XXX Common Stock
(other than Dissenters Shares), upon surrender of such holder's
Certificates in accordance herewith, will be entitled to receive
the shares of IBKC Common Stock and cash into which such holder's
shares have been converted, less any applicable tax withholding.
Until then, each Certificate will represent the number of whole
shares of IBKC Common Stock and cash into which the shares of XXX
Common Stock represented thereby were converted, except that IBKC
may refuse to pay any dividend or other distribution payable to
holders of any unsurrendered Certificates until surrender or if
such dividend or distribution has reverted in full ownership to
IBKC under its Articles of Incorporation. Whether or not a
Certificate is surrendered, after the Effective Time it will not
represent any interest in any person other than IBKC.
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(f) As soon as practicable after the Effective Time, but in no
event later than five Business Days following the Effective Time,
IBKC or the Exchange Agent shall mail to each holder of record of
a Certificate or Certificates a form of letter of transmittal
(which shall specify that delivery shall be effected, and risk of
loss and title to the Certificates shall pass, only upon delivery
of the Certificates to the Exchange Agent) and instructions for
use in effecting the surrender of the Certificates in exchange
for the Merger Consideration into which the shares of XXX Common
Stock represented by such Certificate or Certificates shall have
been converted pursuant to this Section 2.3. Upon proper
surrender of a Certificate for exchange and cancellation to the
Exchange Agent, together with a properly completed letter of
transmittal, duly executed, the holder of such Certificate shall
be entitled to receive in exchange therefor, as applicable, (i) a
certificate representing that number of shares of IBKC Common
Stock to which such former holder of XXX Common Stock shall have
become entitled pursuant to this Agreement and (ii) a check
representing that amount of cash to which such former holder of
XXX Common Stock shall have become entitled pursuant to this
Agreement.
2.4 XXX Stock Options. Each option to purchase shares of XXX
Common Stock (other than the Option) which remains unexercised
immediately prior to the Effective Time, whether or not then
vested or exercisable, shall be cancelled and all rights
thereunder shall be extinguished. As consideration for such
cancellation, XXX shall enter into an agreement with each holder
of an XXX Option to make a cash payment immediately prior to the
Effective Time to each such holder of an XXX Option of an amount
determined by multiplying (x) each share of XXX Common Stock
subject to such xxxxxx'x XXX Option by the sum of (a) the Stock
Consideration times the Market Value, and (b) the Cash
Consideration, with such quotient further multiplied by (y) the
total number of shares of XXX Common Stock subject to such
xxxxxx'x XXX Option, and then subtracting (z) the aggregate
exercise price of such XXX Option.
SECTION III.
CLOSING AND EFFECTIVE TIME
3.1 Time and Place of Closing. (a) The Closing will take place
at 10:00 a.m. on the last Business Day of the month in which
occurs the last of (i) the date that is the required number of
days after the date of the order of the Federal Reserve approving
the Merger pursuant to the BHC Act, (ii) the
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effective date (including expiration of any applicable waiting
period) of the order of the final federal or state regulatory
agency approving the Merger or the expiration of all required
waiting periods after the filing of all required notices to all
federal or state regulatory agencies required to consummate the
Merger, and (iii) the date on which the shareholders of XXX
approve this Agreement; or such other date as the Parties may
mutually agree. If all conditions in Section VIII hereof are
satisfied, or waived by the Party entitled to grant such waiver,
at the Closing (i) the Parties shall each provide to the other
such proof of satisfaction of the conditions in Section VIII as
the Party whose obligations are conditioned upon such satisfaction
may reasonably request, (ii) the certificates, letters and opinions
required by Section VIII shall be delivered, (iii) the appropriate
officers of the Parties shall execute, deliver and acknowledge the
Merger Agreement, and (iv) the Parties shall take such further action
including (without limitation) filing the Merger Agreement as is
required to consummate the transactions contemplated by this
Agreement.
(b) If on any date established for the Closing all conditions
in Section VIII hereof have not been satisfied or waived by each
Party entitled to grant such waiver, then either Party, on one or
more occasions, may declare a delay of the Closing of such
duration, not exceeding 10 days, as the declaring Party shall
select, but no such delay shall extend beyond the last date set
forth in subparagraph (c) of Section 9.1, and no such delay shall
interfere with the right of any party to declare a termination
pursuant to Section IX. The place of Closing shall be at the
office of IBKC set forth in Section 10.7.
3.2 Effective Time. The Merger shall become effective on the
date of the Closing at the time at which the Merger Agreement is
accepted for filing by the Louisiana Secretary of State (or such
other time as is specified in the Merger Agreement).
SECTION IV.
MANAGEMENT AND RELATED MATTERS FOLLOWING MERGER
4.1 Board of Directors of IBKC. At the Effective Time, by
virtue of the Merger, the Board of Directors of IBAC shall
consist of those persons serving as directors of IBKC immediately
prior to the Effective Time.
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4.2 Management of IBKC and LBA Bank.
(a) At the Effective Time, by virtue of the Merger, the
officers of IBAC shall consist of those persons serving as
officers of IBKC immediately prior to the Effective Time.
(b) As of the date hereof, IBERIABANK has entered into a one-
year consulting contract with Xxxxxx Xxxxx, containing the
provisions annexed hereto as Exhibit III, to be effective as of
the Effective Time.
4.3 Employees and Benefits.
(a) After the Effective Time, IBKC will perform the obligations
of XXX under the employment and severance contracts included in
items 13, 14 and 15, as applicable, of Schedule 5.11 to ANA's
disclosure schedule. The officers of XXX and LBA Bank who are
parties to the employment or severance contracts included in such
disclosure schedule will, as of the Effective Time, have "Good
Reason," as such term is defined in the employment and severance
contracts, and, accordingly, will be entitled to payments and
benefits described in such disclosure schedule, provided that, if
necessary, any or all such contracts are amended in a manner
satisfactory to IBKC so that the provisions of Section 280G of
the Internal Revenue Code shall be inapplicable to such contracts
or any payment or payments thereunder or any other agreement. As
detailed in such disclosure schedule, no payments or benefits
under any of such employment or severance contracts shall
constitute a parachute payment under Section 280G of the Internal
Revenue Code.
(b) XXX shall take all necessary action to cause the XXX ESOP
to be terminated as of the Effective Time. The Merger
Consideration received by the ESOP trustees in connection with
the Merger with respect to the unallocated shares of XXX Common
Stock shall be first applied by the ESOP trustees to the full
repayment of the ESOP loan. The balance of the Merger
Consideration received by the ESOP trustees with respect to the
unallocated shares of XXX Common Stock shall be allocated as
earnings to the accounts of all participants in the XXX ESOP who
have accounts remaining under the XXX ESOP (whether or not such
participants are then actively employed) and beneficiaries in
proportion to the account balances of such participants and
beneficiaries, to the maximum extent permitted under the Code and
applicable law. The accounts of all participants and
beneficiaries in the XXX ESOP immediately prior to the Effective
Time shall become fully vested as of the Effective Time. As soon
as practicable after the date hereof, XXX shall file or cause to
be filed all necessary documents with the IRS for a
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determination letter for termination of the XXX ESOP as of the
Effective Time. As soon as practicable after the later of the
Effective Time or the receipt of a favorable determination letter
for termination from the IRS, the account balances in the XXX ESOP
shall be distributed to participants and beneficiaries or transferred
to an eligible individual retirement account or plan as a participant
or beneficiary may direct. Prior to the Effective Time, no
prepayments shall be made on the ESOP loan and contributions to the
XXX ESOP and payments on the ESOP loan shall be made consistent with
past practices on the regularly scheduled payment dates.
(c) As soon as practicable after the Effective Time, the IBKC
Companies agree to provide the employees of the XXX Companies who
remain employed after the Effective Time (collectively, the
"Transferred XXX Employees") with similar types and levels of
employee benefits maintained by the IBKC Companies for their
similarly situated employees. The Transferred XXX Employees shall
be given credit under each employee benefit plan, policy, program
and arrangement maintained by the IBKC Companies after the
Closing for their service with the XXX Companies prior to the
Closing for all purposes, including severance, vacation and sick
leave, including eligibility to participate, vesting, satisfying
any waiting periods, evidence of insurability requirements,
seniority or the application of any pre-existing condition
limitations, other than benefit accrual under a defined benefit
plan (as defined in Section 3(35) of ERISA).
(e) The IBKC Companies shall make reasonable efforts within the
parameters of their health insurance plans to honor any
deductible or out-of-pocket expenses incurred under the
applicable health insurance plans maintained by the XXX Companies
as of the Effective Time.
4.4 Indemnification and Insurance.
(a) IBKC acknowledges that by virtue of the Merger it will
succeed to the indemnification obligations of XXX under Article 8
of its Articles of Incorporation.
(b) IBKC will indemnify and hold harmless the XXX Companies,
and each of their respective directors, officers, employees and
agents, and each controlling person of XXX within the meaning of
the 1933 Act, against any claims, suits, proceedings,
investigations or other actions ("Claims"), and any related
losses, damages, costs, expenses, liabilities or judgments,
whether joint, several or solidary, insofar as they arise out of
or are based upon an
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untrue statement or alleged untrue statement of a material fact
made in the Registration Statement or the Proxy Statement, or an
omission or alleged omission therefrom of a material fact necessary
in order to make the statements made therein, in light of the
circumstances under which they were made, not misleading, and will
reimburse each such person promptly as incurred for legal and other
expenses reasonably incurred in connection with investigating or
defending any such Claims; provided, that IBKC will not be liable to
the extent that any such Claim arises out of or is based upon any
such untrue statement or omission or alleged untrue statement or
omission made in reliance on and in conformity with information
furnished to IBKC by any XXX Company or, with respect to any
indemnified person, by that person.
(c) Any indemnified person wishing to claim indemnification
under Section 4.4, upon learning of any claim, shall notify IBKC
thereof as promptly as is practicable, but the failure to so
notify IBKC shall not relieve IBKC from any obligation it has
under this Section 4.4 except to the extent it is materially and
substantially prejudiced by such failure. IBKC shall have the
right to assume the defense thereof and shall not be liable for
any expenses subsequently incurred by such indemnified person in
connection with the defense thereof, except that if IBKC does not
assume or continue to pursue such defense, or counsel for the
indemnified person advises in writing that there are issues that
raise conflicts of interest between IBKC and the indemnified
person, then the indemnified person may retain counsel
satisfactory to such person (and reasonably satisfactory to IBKC)
at IBKC's expense, provided that (i) IBKC shall not be obligated
to pay for more than one counsel for all indemnified persons in
any jurisdiction except as may be required due to conflicts of
interest, (ii) the indemnified persons will cooperate (to the
extent reasonably appropriate under the circumstances) in the
defense of any such claim, and (iii) IBKC shall not be liable for
any settlement effected without its prior written consent, which
consent may be withheld unless such settlement is reasonable in
light of such claims, actions, suits, proceedings or
investigations against, and defenses available to, such
Indemnified Party.
(d) XXX may, for premiums not to exceed $50,000, purchase a
continuation of its current directors and officers liability
insurance for not more than three years after the Merger.
(e) If IBKC or any of its successors or assigns (i) reorganizes
or consolidates with or merges into or enters into another
business combination transaction
15
with any other person or entity and is not the resulting,
continuing or surviving corporation or entity of such
reorganization, consolidation, merger or transaction or (ii)
liquidates, dissolves or transfers all or substantially all of
its properties and assets to any person or entity, then, and in
each such case, proper provisions will be made so that such
surviving corporation or transferee and its successors and assigns
assume the obligations of IBKC set forth in this Agreement.
SECTION V.
REPRESENTATIONS AND WARRANTIES OF IBKC AND XXX
Each of IBKC and XXX (each a "Warrantor") hereby represents and
warrants to the other of them, to the extent pertaining to
itself, its Subsidiaries, and/or its or their business or
affairs, subject to the standard set forth in Section 5.23
hereof:
5.1 Organization, Standing, and Authority. Warrantor is a
corporation duly organized, validly existing, and in good
standing under the laws of the State of Louisiana, and is duly
qualified to do business and is in good standing in the States of
the United States and foreign jurisdictions where its ownership
or leasing of property or the conduct of its business requires it
to be so qualified. Warrantor has corporate power and authority
to carry on its business as now conducted, to own, lease and
operate its assets, properties and business, and to execute and
deliver, and to perform its obligations under, this Agreement and
the Stock Option Agreement. Warrantor is duly registered as a
bank holding company under the BHC Act. Warrantor has in effect
all federal, state, local and foreign governmental authorizations
necessary for it to own or lease its properties and assets and to
carry on its business as it is now conducted.
5.2 Capital Stock.
(a) The authorized, issued and outstanding capital stock of
Warrantor as of the date of this Agreement, the number of shares
of Warrantor Common Stock reserved for issuance under the
Warrantor Stock Option Plans as of such date and the number of
shares of Warrantor Common Stock that are subject to outstanding
options under such Plans as of such date, are set forth in the
section of Schedule 5.2(a) attached hereto that pertains to
Warrantor. All of the issued and outstanding shares of Warrantor
Capital Stock are duly and validly authorized and issued and are
fully paid and non-assessable.
16
None of the outstanding shares of Warrantor Capital Stock has been
issued in violation of any preemptive rights of the current or
past shareholders of Warrantor.
(b) Except as Previously Disclosed or set forth in Section
5.2(a) or Schedule 5.2(a), and except as provided under the Stock
Option Agreement, there are, as of the date of this Agreement
and, will be at the Effective Time, no shares of capital stock or
other equity securities of XXX outstanding and, no outstanding
options, warrants, scrip, rights to subscribe to, calls or
commitments of any character whatsoever relating to, or
securities or rights convertible into or exchangeable for, shares
of the capital stock of XXX or contracts, commitments,
understandings or arrangements by which XXX is or may be bound to
issue additional shares of its capital stock or options, warrants
or rights to purchase or acquire any additional shares of its
capital stock.
5.3 Warrantor Subsidiaries. Exhibit 21 to Warrantor's Annual
Report on Form 10-K for the fiscal year ended December 31, 2001,
as supplemented or updated by information Previously Disclosed,
lists all of the Warrantor Subsidiaries that are Significant
Subsidiaries (as defined in Section 1.1) ("Warrantor Significant
Subsidiaries") as of the date of this Agreement. Each of the
Warrantor Significant Subsidiaries that is a bank is an "insured
depository institution" as defined in the Federal Deposit
Insurance Act and applicable regulations thereunder. No equity
securities of any of the Warrantor Significant Subsidiaries are
or may become required to be issued (other than to Warrantor) by
reason of any options, warrants, scrip, rights to subscribe to,
calls or commitments of any character whatsoever relating to, or
securities or rights convertible into or exchangeable for, shares
of the capital stock of any Warrantor Significant Subsidiary, and
there are no contracts, commitments, understandings or
arrangements by which any Warrantor Significant Subsidiary is
bound to issue (other than to Warrantor) additional shares of its
capital stock or options, warrants or rights to purchase or
acquire any additional shares of its capital stock. There are no
contracts, commitments, understandings or arrangements by which
any of the Warrantor Companies is or may be bound to sell or
otherwise transfer any shares of the capital stock of any
Warrantor Significant Subsidiary, except for a transfer to any of
the Warrantor Companies, and there are no contracts, commitments,
understandings or arrangements relating to the rights of any
Warrantor Company to vote or to dispose of such shares. Except as
provided in Louisiana Revised Statutes 6:262, all of the shares
of capital stock of each Warrantor Significant Subsidiary held by
Warrantor or a Warrantor
17
Subsidiary are fully paid and non-assessable and are owned by
Warrantor or a Warrantor Subsidiary free and clear of any claim,
lien or encumbrance. Except as Previously Disclosed, each
Warrantor Significant Subsidiary is either a state bank, a state
savings bank, a corporation, or a limited liability company and
is duly organized, validly existing and in good standing under
the laws of the jurisdiction in which it is incorporated or
organized, and is duly qualified to do business and in good
standing in the jurisdictions where its ownership or leasing of
property or the conduct of its business requires it to be so
qualified. Each Warrantor Significant Subsidiary has the
corporate power and authority necessary for it to own or lease
its properties and assets and to carry on its business as it is
now being conducted, and has all federal, state, local and
foreign governmental authorizations necessary for it to own or
lease its properties and assets and to carry on its business as
it is now being conducted.
5.4 Authority.
(a) The execution and delivery of this Agreement, the Merger
Agreement and the Stock Option Agreement and the consummation of
the transactions contemplated herein or therein, including the
Merger, have been duly and validly authorized by all necessary
corporate action on the part of Warrantor, subject in the case of
XXX with respect to this Agreement and the Merger Agreement, to
the approval of the shareholders of XXX to the extent required by
applicable law. This Agreement and the Merger Agreement, subject
to any requisite approval by ANA's shareholders hereof and
thereof, and the Stock Option Agreement, represent valid and
legally binding obligations of Warrantor, enforceable against
Warrantor in accordance with their respective terms, except as
enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other laws affecting
the enforcement of creditors' rights generally and except that
the availability of the equitable remedy of specific performance
or injunctive relief is subject to the discretion of the court
before which any proceeding may be brought.
(b) Neither the execution and delivery of this Agreement, the
Merger Agreement or the Stock Option Agreement by Warrantor, nor
the consummation by Warrantor of the transactions contemplated
herein or therein, nor compliance by any Warrantor Company with
any of the provisions hereof or thereof, will (i) conflict with
or result in a breach of any provision of any Warrantor Company's
articles of incorporation or by-laws, or (ii) except as
Previously Disclosed, constitute or result in the breach of any
term, condition or provision of, or constitute a default under,
or give rise to
18
any right of termination, cancellation or acceleration with
respect to, or result in the creation of any lien, charge or
encumbrance upon any property or assets of any of the Warrantor
Companies pursuant to, any note, bond, mortgage, indenture,
license, agreement, lease or other instrument or obligation to
which any of them is a party or by which any of them or any of
their properties or assets may be subject, or (iii) subject to
receipt of the requisite approvals, authorizations, filings,
registrations and notifications referred to in Section 8.5 of
this Agreement, violate any order, writ, injunction, decree,
statute, rule or regulation applicable to any of the Warrantor
Companies or any of their properties or assets.
(c) Other than in connection or compliance with the provisions
of applicable state corporate and securities laws, the Securities
Laws and the rules and regulations thereunder, and other than
consents, authorizations, approvals or exemptions required from
the Federal Reserve and the State Regulatory Commissioners, no
notice to, filing with, authorization of, exemption by or consent
or approval of any public body or authority is necessary for the
consummation by Warrantor of the Merger and the other
transactions contemplated by this Agreement, the Merger Agreement
and the Stock Option Agreement.
(d) The Board of Directors of Warrantor (at a meeting duly
called and held prior to the execution of this Agreement) has by
requisite vote (i) determined that the Merger is in the best
interests of Warrantor and its shareholders, among others, (ii)
authorized and approved this Agreement, the Merger Agreement, the
Stock Option Agreement and the transactions contemplated hereby
and thereby, including the Merger, (iii) in the case of XXX,
directed that the Merger be submitted for consideration to
Warrantor's shareholders at the Shareholders' Meeting, and (iv)
approved execution of the Stock Option Agreement in accordance
with Section 134C(1)(b) of the BCL, with the result that such
Section will not apply to the execution and delivery by Warrantor
of the Stock Option Agreement or the issuance of shares of XXX
Common Stock pursuant to the Stock Option Agreement, the
consummation of the Merger, or any other transaction to be
carried out pursuant to this Agreement, the Merger Agreement or
the Stock Option Agreement.
5.5 Financial Statements; Accounting. Warrantor has delivered
to the other Party, prior to the execution of this Agreement,
Warrantor Financial Statements as of and for the period ended
June 30, 2002, and will promptly deliver when available copies of
Warrantor Financial Statements in respect of periods ending after
June 30, 2002. The Warrantor Financial Statements
19
(as of the dates thereof and for the periods covered thereby): (i)
are (and, in the case of Warrantor Financial Statements in respect
of periods ending after June 30, 2002, will be) in accordance with
the books and records of the Warrantor Companies, and have been
and will continue to be maintained in accordance with GAAP
(except as permitted by Regulation S-X of the SEC), in all
material respects, and (ii) except as permitted by Regulation S-X
of the SEC, present (and, in the case of Warrantor Financial
Statements in respect of periods ending after June 30, 2002, will
present) fairly the consolidated financial position and the
consolidated results of operations, changes in stockholders'
equity and cash flows of the Warrantor Companies as of the dates
and for the periods indicated, in all material respects in
accordance with GAAP applicable to banks or bank holding
companies applied on a basis consistent with prior periods
(subject in the case of interim financial statements to normal
year-end adjustments).
5.6 Absence of Undisclosed Liabilities. Except as Previously
Disclosed, none of the Warrantor Companies has any obligation or
liability (contingent or otherwise) that is material, either
individually or in the aggregate, to the financial condition,
results of operations or, to the Warrantor Companies' best
knowledge, business prospects of the Warrantor Companies on a
consolidated basis, or that when combined with all similar
obligations or liabilities would, either individually or in the
aggregate, be material to the financial condition, results of
operations or, to the Warrantor Companies' best knowledge,
business prospects of the Warrantor Companies on a consolidated
basis, except (i) as reflected in the Warrantor Financial
Statements delivered prior to the date of this Agreement, (ii) as
reflected by this Agreement or (iii) for commitments and
obligations made, or liabilities incurred, since June 30, 2002 in
the ordinary course of its business consistent with past
practices.
5.7 Tax Matters.
(a) All material federal, state, local and foreign tax returns
required to be filed by or on behalf of any of Warrantor and all
Subsidiaries which are included in Warrantor's consolidated tax
group for Federal income taxes have been timely filed or
requests for extensions have been timely filed, granted and have
not expired. All taxes shown on filed returns have been paid.
There is no audit examination, deficiency, refund litigation or
matter in controversy with respect to any taxes, except as
reserved against in the Warrantor Financial Statements or as
Previously Disclosed. All taxes, interest, additions and
penalties which are material in amount and which are
20
due with respect to completed and settled examinations or
concluded litigation have been paid or adequately reserved for.
(b) Except as Previously Disclosed, none of the Warrantor
Companies has executed an extension or waiver of any statute of
limitations on the assessment or collection of any tax due that
is currently in effect.
(c) Adequate provision for any federal, state, local or foreign
taxes due or to become due for any of the Warrantor Companies for
any period or periods through and including June 30, 2002 has
been made and is reflected in the Warrantor Financial Statements,
and will be made through and including the Closing Date.
(d) Deferred taxes of the Warrantor Companies have been
provided for in accordance with GAAP.
5.8 Loans, Reserves, and Investments.
(a) All loans, discounts and financing leases (in which a
Warrantor Company is lessor) (collectively, "Credits") reflected
in the Warrantor Financial Statements were, as of the respective
dates of such Financial Statements (i) made for adequate
consideration in the ordinary course of business, (ii) evidenced
by instruments that were true and genuine, and (iii) if secured,
secured by valid perfected security interests. Accurate lists of
all such Credits of the XXX Companies and of the investment
portfolios of the XXX Companies as of the date of the latest
Financial Statements of XXX delivered on or prior to the date of
this Agreement have been made available to IBKC.
(b) The aggregate allowances for losses on Credits and other
real estate and foreclosed assets owned reflected on the latest
Warrantor Financial Statement delivered on or prior to the date
of this Agreement were, as of the date of such Financial
Statements and will be at the Closing date, adequate in
accordance with regulatory guidelines and GAAP in all material
respects.
5.9 Properties and Insurance. Except as Previously Disclosed or
reserved against in the Warrantor Financial Statements, the
Warrantor Companies have good and marketable title, free and
clear of all liens, encumbrances, charges, defaults or equities
of any character, to all of the material properties and assets,
tangible or intangible, reflected in the Warrantor Financial
Statements as being owned by the Warrantor Companies as of the
dates
21
thereof. To the knowledge of Warrantor's management, (a) all
buildings and all fixtures, equipment and other property and
assets which are material to its business on a consolidated basis
and are held under leases or subleases by any of the Warrantor
Companies are held under valid leases or subleases enforceable in
accordance with their respective terms (except as enforceability
may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other laws affecting the
enforcement of creditors' rights generally and except that the
availability of the equitable remedy of specific performance or
injunctive relief is subject to the discretion of the court
before which any proceedings may be brought); and (b) the
policies of fire, theft, liability, fidelity and other insurance
maintained with respect to the assets or businesses of the
Warrantor Companies provide adequate coverage against loss.
5.10 Compliance with Laws. Except as Previously Disclosed, each
of the Warrantor Companies:
(a) Is in compliance in all material respects with all laws,
regulations, reporting and licensing requirements and orders
applicable to its business or to the employees conducting its
business;
(b) Has received no notification or communication from any
agency or department of federal, state or local government
(including the Federal Reserve, State Regulatory Commissioners
and other bank, insurance and securities regulatory
authorities) or the staff thereof (i) threatening to revoke any
license, franchise, permit or governmental authorization which
is material, either individually or in the aggregate, to the
financial condition, results of operations or, to the Warrantor
Companies' best knowledge, business prospects of the Warrantor
Companies on a consolidated basis or the ability of Warrantor
to consummate the transactions contemplated under this
Agreement, the Merger Agreement or the Stock Option Agreement,
under the terms hereof and thereof, or (ii) requiring any of the
Warrantor Companies (or any of their officers, directors or
controlling persons) to enter into a cease and desist order,
agreement or memorandum of understanding (or requiring the
board of directors thereof to adopt any resolution or policy);
and
(c) Has complied in all material respects with the Community
Reinvestment Act ("CRA") and the rules and regulations
thereunder, and has a CRA rating of not less than
"satisfactory".
22
5.11 Employee Benefit Plans.
(a) (i) Warrantor has delivered or made available to the other
Party, prior to the execution of this Agreement, copies of each
pension, retirement, profit sharing, supplemental or excess
retirement, stock option, stock purchase, savings, employee stock
ownership, restricted stock, phantom stock, stock ownership, life
insurance, disability, vacation pay, severance pay (including,
without limitation change of control or golden parachute
arrangements), incentive, deferred compensation, bonus or benefit
arrangement, health or hospitalization program, fringe benefit or
perquisite arrangement or other similar plan as in effect on the
date of this Agreement, including, without limitation, any
"employee benefit plan", as that term is defined in Section 3(3)
of ERISA, in respect of any of the present or former directors,
officers, employees or independent contractors of, or dependents,
spouses or other beneficiaries of any of such directors,
officers, employees or independent contractors of, any of the
Warrantor Companies (collectively, the "Warrantor Benefit
Plans"), and (ii) XXX has delivered or made available to IBKC,
prior to the execution of this Agreement, copies of each
employment or consulting agreement as in effect on the date of
this Agreement which provides any benefit or perquisites to or in
respect of any of the present or former directors or officers of,
or dependents, spouses or other beneficiaries of any of such
directors or officers of, any of the XXX Companies, which
employment and consulting agreements are, with respect to XXX,
included in the term "Warrantor Benefit Plans" as defined above.
Any of the Warrantor Benefit Plans which is an "employee pension
benefit plan," as that term is defined in Section 3(2) of ERISA,
is referred to herein as a "Warrantor ERISA Plan". No Warrantor
Company has participated in or been a member of, and no Warrantor
Benefit Plan is or has been, a multi-employer plan within the
meaning of Section 3(37) of ERISA. Except as Previously
Disclosed, the Warrantor Benefit Plans of XXX and its
Subsidiaries are terminable on their terms without penalty or
payment except for accrued and vested benefits thereunder.
(b) All Warrantor Benefit Plans comply in all material respects
with the applicable provisions of ERISA and the Code, and any
other applicable laws, rules and regulations the breach or
violation of which could result in a liability, either
individually or in the aggregate, material to the financial
condition, results of operations or prospects of the Warrantor
Companies on a consolidated basis. With respect to the Warrantor
Benefit Plans, no event has occurred and, to the best knowledge
of Warrantor's management, there exists no condition or set of
circumstances, in connection with which any of the
23
Warrantor Companies could be subject to any liability (except
liability for severance payments benefit claims, Pension Benefit
Guaranty Corporation premiums, funding obligations payable in the
ordinary course and distributions upon termination of the XXX
ESOP). No notice of a "reportable event," as that term is defined
in Section 4043 of ERISA, for which the 30-day reporting requirement
has not been waived has been required to be filed for any
Warrantor ERISA Plan which is subject to Title IV of ERISA within
the 12-month period ending on the date of this Agreement. None of
the Warrantor Companies has provided, or is required to provide,
security to any Warrantor ERISA Plan which is subject to Title IV
of ERISA pursuant to Section 401(a)(20) of the Internal Revenue
Code.
(c) Except as Previously Disclosed, no Warrantor ERISA Plan
which is subject to Title IV of ERISA has any "unfunded current
liability," as that term is defined in Section 302(d)(8)(A) of
ERISA, and the present fair market value of the assets of each
such plan exceeds the plan's "benefit liabilities," as that term
is defined in Section 4001(a)(16) of ERISA, when determined under
actuarial factors that would apply if the plan terminated as of
the date of this Agreement in accordance with all applicable
legal requirements.
5.12 Material Contracts. Except as Previously Disclosed, none
of the Warrantor Companies, nor any of their respective assets,
businesses or operations, as of the date of this Agreement, is a
party to, or is bound or affected by, or receives benefits under,
any contract or agreement or amendment thereto that in each case
would be required to be filed as an exhibit to a Form 10-K or
Form 10-Q filed by Warrantor as of the date of this Agreement
that has not been filed as an exhibit.
5.13 Material Contract Defaults. None of the Warrantor
Companies is in default under any contract, agreement,
commitment, arrangement, lease, insurance policy or other
instrument to which it is a party, by which its respective
assets, business or operations may be bound or affected, or under
which it or its respective assets, business or operations
receives benefits, and there has not occurred any event that,
with the lapse of time or the giving of notice or both, would
constitute such a default.
5.14 Legal Proceedings. Except as Previously Disclosed, there
are no actions, suits or proceedings instituted or pending or, to
the best knowledge of Warrantor's management, threatened against
any of the Warrantor Companies, or affecting any property, asset,
interest or right of any of them.
24
5.15 Absence of Certain Changes or Events. Since June 30, 2002,
the Warrantor Companies, taken as a whole on a consolidated
basis, have not suffered any change in any respect that has had
or is likely to have a Warrantor Material Adverse Effect.
5.16 Reports. Since January 1, 1999, or, with respect to each
Warrantor Subsidiary, the date of its acquisition by Warrantor if
later than January 1, 1999, each of the Warrantor Companies has
filed all reports and statements, together with any amendments
required to be made with respect thereto, that it was required to
file with (i) the SEC, including, but not limited to, Forms 10-K,
Forms 10-Q, Forms 8-K and proxy statements, (ii) the Federal
Reserve, (iii) the OTS, (iv) the Federal Deposit Insurance
Corporation, and (v) any applicable state banking, insurance,
securities or other regulatory authorities. As of their
respective dates (and without giving effect to any amendments or
modifications filed after the date of this Agreement with respect
to reports and documents filed before the date of this
Agreement), each of such reports and documents, including the
financial statements, exhibits and schedules thereto, complied in
all material respects with all of the statutes, rules and
regulations enforced or promulgated by the authority with which
they were filed and did not contain any untrue statement of a
material fact or omit to state any material fact necessary in
order to make the statements made therein in light of the
circumstances under which they were made not misleading, except
as Previously Disclosed.
5.17 Statements True and Correct. None of the information
supplied or to be supplied by Warrantor for inclusion in (i) the
Registration Statement to be filed by IBKC with the SEC in
connection with the IBKC Common Stock to be issued in the Merger,
(ii) the Proxy Statement to be mailed to ANA's shareholders in
connection with the Shareholders Meeting, and (iii) any other
documents to be filed with the SEC or any other Regulatory
Authority in connection with the transactions contemplated
hereby, will, at the respective times such documents are filed,
and, in the case of the Registration Statement, when it becomes
effective and, with respect to the Proxy Statement, when first
mailed to the shareholders of XXX, be false or misleading with
respect to any material fact, or omit to state any material fact
necessary in order to make the statements therein not misleading,
or, in the case of the Proxy Statement or any amendment thereof
or supplement thereto, at the time of the Shareholders Meeting,
be false or misleading with respect to any material fact, or omit
to state any material fact necessary to make the statements
therein in light of the circumstances under which they were made
not misleading. All documents that Warrantor is responsible for
25
filing with the SEC or any other Regulatory Authority in
connection with the transactions contemplated hereby, by the
Merger Agreement or by the Stock Option Agreement, will comply in
all material respects with the provisions of applicable law
including applicable provisions of the Securities Laws.
5.18 Environmental Matters.
(a) To the best knowledge of Warrantor's management, Warrantor
and each Warrantor Subsidiary (for purposes of this Section 5.18,
the term "Warrantor Subsidiary" shall include small business
investment corporations and entities that invest in unaffiliated
companies in the ordinary course of business in which Warrantor
owns or controls 5% or more of the outstanding equity securities
either directly or through an unbroken chain of entities as to
each of which 5% or more of the outstanding equity securities is
owned directly or indirectly by Warrantor), the Participation
Facilities, the Loan Properties and the Trust Properties (each as
defined below) are, and have been, in compliance with all
applicable laws, rules, regulations and standards, and all
requirements of the United States Environmental Protection Agency
("EPA") and of state and local agencies with jurisdiction over
pollution or protection of health or the environment.
(b) To the best knowledge of Warrantor's management, there is
no suit, claim, action or proceeding, pending or threatened,
before any court, governmental agency, board or other forum
pursuant to which Warrantor or any of the Warrantor Subsidiaries
or any Loan Property, Participation Facility or Trust Property
(or in respect of such Loan Property, Participation Facility or
Trust Property) has been or, with respect to threatened
proceedings may be, named as a defendant (i) for alleged
noncompliance (including by any predecessor) with any
environmental law, rule or regulation or (ii) relating to the
release into the environment of any Hazardous Material (as
defined below) or oil, whether or not occurring at or on any site
owned (including as trustee), leased or operated by it or any of
its subsidiaries or any Loan Property, Participation Facility or
Trust Property.
(c) To the best knowledge of Warrantor's management, there is
no reasonable basis for any suit, claim, action or proceeding of
a type described in Section 5.18(b).
(d) During the period of (i) Warrantor's or any of the
Warrantor Subsidiaries' ownership (including as trustee) or
operation of any of their respective current properties, (ii)
Warrantor's or any of the Warrantor
26
Subsidiaries' participation in the management of any Participation
Facility, (iii) Warrantor's or any of the Warrantor Subsidiaries'
holding of a security interest in a Loan Property, or (iv)
Warrantor or any of the Warrantor Subsidiaries acting as a trustee
or fiduciary with respect to a Trust Property, to the best
knowledge of Warrantor's management, there has been no release of
Hazardous Material or oil in, on, under or affecting such
property, Participation Facility, Loan Property or Trust Property.
Prior to the period of (w) Warrantor's or any of the Warrantor
Subsidiaries' ownership (including as trustee) or operation of
any of their respective current properties, (x) Warrantor's or
any of the Warrantor Subsidiaries' participation in the
management of any Participation Facility, (y) Warrantor's or any
of the Warrantor Subsidiaries acting as trustee or other
fiduciary with respect to Trust Property, or (z) Warrantor's or
any of the Warrantor Subsidiaries' holding of a security interest
in a Loan Property, to the best knowledge of Warrantor's
management, there was no release of Hazardous Material or oil in,
on, under or affecting any such property, Participation Facility,
Loan Property or Trust Property.
(e) The following definitions apply for purposes of this
Section 5.18: (i) "Loan Property" means any property in which
Warrantor (or a Warrantor Subsidiary) holds a security interest
and, where required by the context, includes the owner or
operator of such property, but only with respect to such
property; (ii) "Participation Facility" means any property in
which Warrantor (or a Warrantor Subsidiary) participates in the
management of such property and, where required by the context,
includes the owner or operator of such property, but only with
respect of such property; (iii) "Trust Property" means any
property with respect to which Warrantor (or a Warrantor
Subsidiary) acts or has acted as a trustee or other fiduciary,
directly or indirectly, and includes any trust or similar legal
vehicle that owns or controls (or that owned or controlled) such
property and, where required by the context, includes the trustee
or other fiduciary, but only with respect to such property; and
(iv) "Hazardous Material" means any pollutant, contaminant or
hazardous substance within the meaning of the Comprehensive
Environmental Response, Compensation, and Liability Act, 42
U.S.C. Section 9601 et seq., or any similar federal, state or
local law.
5.19 Knowledge as to Conditions. On the date of this Agreement,
Warrantor knows of no reason why the approvals, authorizations,
filings, registrations and notices contemplated by Section 8.5
should not be obtained without the imposition of any material and
adverse condition or restriction or
27
why the accountants' letters referred to in Section 8.7 or the
Tax Opinion referred to in Section 7.3 cannot be obtained.
5.20 Labor Matters. Neither Warrantor nor any of the Warrantor
Companies 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
Warrantor or any of the Warrantor Companies the subject of any
proceeding asserting that Warrantor or any Warrantor Company has
committed an unfair labor practice or seeking to compel Warrantor
or any Warrantor Company to bargain with any labor union or labor
organization as to wages and conditions of employment, nor is
there any strike or other labor dispute involving Warrantor or
any of the Warrantor Companies pending or threatened.
5.21 Fairness Opinion. XXX has received the written opinion of
ANA's financial advisor, rendered to the Board of Directors of
XXX and dated the date of this Agreement, that subject to the
various assumptions and limitations set forth in that opinion,
the Merger Consideration proposed to be received by holders of
XXX Common Stock is fair to such holders from a financial point
of view. A copy of such opinion shall be furnished to IBKC for
inspection purposes only.
5.22 Access to Funds. As of the date of this Agreement, IBKC
has, and on the Closing will have, access to all funds necessary
to consummate the Merger and pay the aggregate Cash
Consideration, and IBKC will meet its obligations to pay the
aggregate Merger Consideration. IBKC will need, and has the
capacity, to incur borrowings for the express purpose of funding
all or part of the aggregate Cash Consideration, and IBKC does
not need to raise additional capital to consummate the
transactions contemplated by this Agreement.
5.23 Materiality. No representation or warranty by a Warrantor
contained in this Section V shall be deemed untrue or incorrect,
and no party hereto shall be deemed to have breached a
representation or warranty, on account of the existence of any
fact, circumstance or event unless, as a direct or indirect
consequence of such fact, circumstance or event, individually or
taken together with all other facts, circumstances or events
inconsistent with any paragraph of Section V, as applicable,
there is or is reasonably likely to be a Material Adverse Effect,
except that the representations and warranties in Sections 5.1,
5.2 and 5.4 shall be true and correct in all respects. ANA's
representations, warranties and covenants contained in this
Agreement shall
28
not be deemed to be untrue or breached as a result of effects
arising solely from actions taken in compliance with this
Agreement or a written request of IBKC.
SECTION VI.
COVENANTS AND AGREEMENTS
Each Party hereby covenants and agrees with the other Party
as follows:
6.1 Conduct of Business--Negative Covenants. From the date of
this Agreement until the earlier of the Effective Time or the
termination of this Agreement, XXX will not do, or agree or
commit to do, and will cause each of its Subsidiaries not to do
or agree to commit to do, any of the following without the prior
written consent of a duly authorized officer of IBKC, which
consent will not be unreasonably withheld:
(a) Except as Previously Disclosed or as expressly
contemplated by this Agreement, amend its articles of
incorporation or association or by-laws, or
(b) Impose, or suffer the imposition, on any share of stock
held by it or by any of its Subsidiaries, of any material lien,
charge or encumbrance, or permit any such lien, charge or
encumbrance to exist, or
(c) Except as expressly permitted in this Agreement or in
connection with (1) the use of Common Stock by optionees to pay
an option exercise price or to satisfy tax liabilities under the
XXX Stock Option Plan and (2) the repurchase of XXX Common Stock
in accordance with the Stock Option Agreement, repurchase,
redeem, or otherwise acquire or exchange, directly or indirectly,
any shares of its capital stock or any securities convertible
into any shares of its capital stock, or
(d) Except as expressly contemplated by this Agreement or as
Previously Disclosed, acquire direct or indirect control over any
corporation, association, firm or organization, other than in
connection with (i) internal reorganizations or consolidations
involving existing Subsidiaries, (ii) good faith foreclosures in
the ordinary course of business, (iii) acquisitions of control by
a banking Subsidiary in a bona fide fiduciary capacity, (iv)
investments made by small business investment corporations or by
Subsidiaries that invest in unaffiliated companies in the
ordinary course of
29
business, or (v) the creation of new Subsidiaries organized to
conduct or continue activities otherwise permitted by this
Agreement, or
(e) Except as Previously Disclosed, XXX will not sell or
otherwise dispose of, or permit any of its Subsidiaries to sell
or otherwise dispose of: (i) any shares of capital stock of XXX
or any Subsidiary of XXX (except for shares of stock sold or
otherwise transferred to IBKC or any of its Subsidiaries or
shares which may be issued upon the exercise and otherwise under
the terms of any of the 245,469 stock options outstanding,
pursuant to the XXX Stock Option Plan, on the date hereof), (ii)
any substantial part of the assets or earning power of such Party
or any Subsidiary of such Party, or (iii) any asset other than in
the ordinary course of business for reasonable and adequate
consideration, or
(f) Except as Previously Disclosed, incur, or permit any of
its Subsidiaries to incur, any additional material debt
obligation or other material obligation for borrowed money (other
than (i) in replacement of existing short-term debt with other
short-term debt, (ii) financing of banking related Subsidiary
activities consistent with past practices, (iii) indebtedness of
any of its Companies to another of its Companies or (iv)
indebtedness of any of its Companies to any of their respective
affiliates), except in the ordinary course of the business of
such Party and its Subsidiaries consistent with past practices
(and such ordinary course of business shall include, but shall
not be limited to, the creation of deposit liabilities, purchases
of federal funds, sales of certificates of deposit and entry into
repurchase agreements), or
(g) Grant any increase in compensation or benefits to its
employees or to its officers or employees; pay any bonus not in
accordance with past practice and the provisions of any
applicable program or plan of the XXX Companies as in effect
prior to the date of this Agreement and which has been Previously
Disclosed, enter into any severance agreements with any of its
directors or officers or the directors or officers of any
Subsidiary; grant any increase in fees or other increases in
compensation or other benefits to any of its present or former
directors, or 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 opinion of counsel, is
necessary or advisable to maintain the tax qualification of any
plan under which the retirement benefits are provided) that would
increase the retirement benefit liabilities of the XXX Companies
on a consolidated basis, except that XXX may (A) pay up to
$90,000 (or such greater amount to which IBKC may consent) as
retention bonuses to employees and in amounts mutually agreed
upon by XXX and IBKC, (B)
30
under its management bonus program pay amounts accrued and to be
accrued monthly in amounts not in excess of monthly accruals
since January 1, 2002 on the Financial Statements of XXX, but
only immediately prior to the Effective Time, (C) pay its
Christmas bonuses in an aggregate amount not to exceed the
aggregate amount accrued on the Financial Statements of XXX for
Christmas bonuses for 2002, (D) increase the compensation of non-
exempt employees consistent with past practice, and (E) increase
the compensation of exempt employees to the extent consistent
with past practice and in an individual or aggregate amount not
to exceed 4% of the annual rate of total compensation of any
person or to all non-exempt employees.
(h) Except as contemplated by this Agreement, the Merger
Agreement or any of the agreements, documents or instruments
contemplated hereby or thereby, or except as Previously
Disclosed, amend any existing employment, severance or similar
contract between such Party or any Subsidiary thereof (unless
such amendment is required by law) or enter into any new contract
with any person, or
(i) Except as contemplated by this Agreement, the Merger
Agreement or any of the agreements, documents or instruments
contemplated hereby or thereby, adopt any new employee benefit
plan of XXX or any XXX Subsidiary or make any material change in
or to any existing employee benefit plan of such Party or any
Subsidiary thereof other than (i) as Previously Disclosed or
(ii) any such change that is required by law or that, in the
opinion of counsel, is necessary or advisable to maintain the tax
qualified status of any such plan.
6.2 Conduct of Business--Affirmative Covenants. Unless the
prior written consent of the other Party shall have been
obtained, except as otherwise contemplated or permitted hereby or
Previously Disclosed, each Party shall and shall cause its
Subsidiaries: to operate its business only in the ordinary course
of business of such Party and its Subsidiaries consistent with
past practices, to preserve intact its business organizations and
assets and maintain its rights and franchises, and to take no
action which would (i) adversely affect the ability of any of
them to obtain any necessary approvals of Regulatory Authorities
required for the transactions contemplated hereby without
imposition of a condition or restriction of the type referred to
in the second sentence of Section 8.5 of this Agreement, (ii)
adversely affect the ability of such Party to perform its
obligations under this Agreement, the Merger Agreement and Stock
Option Agreement, or (iii) cause or permit a breach of any of its
covenants or cause or permit any representation or
31
warranty of it to become untrue in any material respect, as if
each such representation and warranty were continuously made from
the date hereof.
6.3 Adverse Changes in Condition. Each Party shall give written
notice promptly to the other Party concerning (i) any event which
has had, or is reasonably likely to have, a Material Adverse
Effect on such Party, or (ii) the occurrence or impending
occurrence of any event or circumstance known to such Party which
would cause or constitute a material breach of any of the
representations, warranties or covenants of such Party contained
herein or that would reasonably be expected to materially and
adversely affect the timely consummation of the transactions
contemplated hereby or under the Merger Agreement or Stock Option
Agreement. Each Party shall use its reasonable best efforts to
prevent or to promptly remedy the same.
6.4 Investigation and Confidentiality. Prior to the Effective
Time, each Party will keep the other Party promptly advised of
all material developments relevant to its business and to the
consummation of the Merger and may make or cause to be made such
investigation, if any, of the business, properties, operations
and financial and legal condition of the other Party and its
Subsidiaries as such Party reasonably deems necessary or
advisable to familiarize itself and its advisors with such
business, properties, operations and condition, provided that
such investigation shall be reasonably related to the
transactions contemplated hereby and shall not interfere
unnecessarily with normal operations. Each Party agrees to
furnish the other Party and the other Party's respective advisors
with such financial and operating data and other information with
respect to its business, properties and employees as the other
Party shall from time to time reasonably request. No
investigation by one Party shall affect the representations and
warranties of the other Party and, subject to Section 9.3 of this
Agreement, each such representation and warranty shall survive
any such investigation. Each Party shall maintain the
confidentiality of all confidential information furnished to it
by the other Party in accordance with the terms of the
confidentiality agreement dated November 16, 2001, as
supplemented on November 19, 2001, between the Parties (the
"Confidentiality Agreement").
6.5 Reports. Each Party shall file all reports required to be
filed by it with the SEC and the Federal Reserve between the date
of this Agreement and the Effective Time and shall deliver to the
other Party copies of all such reports promptly after the same
are filed. Each Party shall cause each of its Subsidiaries that
is a depository institution to file all reports required to be
32
filed with the Federal Deposit Insurance Corporation, the Office
of the Comptroller of the Currency, the Federal Reserve, the OTS
and any applicable State Regulatory Commissioner.
6.6 Dividends.
(a) From the date of this Agreement to the earlier of the
Effective Time or the termination of this Agreement, XXX will not
declare or pay any dividend or other distribution to its
shareholders except regular quarterly cash dividends on the
shares of XXX Common Stock, at a rate not in excess of $.15 per
share, and declared and paid at the times such regular dividends
were previously declared and paid.
(b) From the date of this Agreement to the earlier of the
Effective Time or the termination of this Agreement, no Party
shall, without the prior written consent of the other Party, make
any changes in its dividend record or payment dates, except as
required to comply with paragraph (c) below.
(c) The Parties shall coordinate with one another as to the
declaration and payment of cash dividends on the shares of IBKC
Common Stock and XXX Common Stock to be declared in 2002 and 2003
so as to ensure that IBKC and XXX have declared, with the record
dates prior to the Effective Time, the same number of quarterly
dividends from September 1, 2002 through the Effective Time.
6.7 Capital Stock. Except for or as otherwise permitted in or
contemplated by this Agreement (including Section 6.1(e) hereof),
the Merger Agreement or the Stock Option Agreement, or as
Previously Disclosed, without the prior written consent of IBKC,
from the date of this Agreement to the earlier of the Effective
Time or the termination of this Agreement, XXX shall not, and
shall not enter into any agreement to, issue, sell, or otherwise
permit to become outstanding any additional shares of XXX Common
Stock or any other capital stock of XXX, or any stock
appreciation rights, or any option, warrant, conversion or other
right to acquire any such stock, or any security convertible into
any such stock.
6.8 Agreement of Affiliates. XXX shall deliver to IBKC, no
later than 30 days after the date of this Agreement, a letter
identifying each person whom it reasonably believes is an
"affiliate" of XXX for purposes of Rule 145 under the 1933 Act.
Thereafter and until the date on which the Merger is approved by
the Federal Reserve, XXX shall identify to IBKC each additional
person
33
whom XXX reasonably believes to have thereafter become an
"affiliate". XXX shall use its best efforts to cause each person
who is identified as an "affiliate" of XXX pursuant to the two
immediately preceding sentences to deliver to IBKC, not later
than the date on which the Merger is approved by the Federal
Reserve, a written agreement, substantially in the form of
Exhibit IV.
6.9 Certain Actions.
(a) Without limiting ANA's other obligations hereunder, XXX
agrees that, from the date of this Agreement until the earlier of
the Effective Time or the termination of this Agreement, neither
it nor any of its Subsidiaries or affiliates, nor any of the
officers and directors of it or its Subsidiaries or affiliates
shall, and that it shall cause its and its Subsidiaries' and
affiliates' employees, agents and representatives (including any
investment banker, attorney or accountant retained by it or any
of its Subsidiaries) not to, directly or indirectly, (i)
initiate, solicit, encourage or knowingly facilitate any
inquiries or the making of any Acquisition Proposal, (ii) have
any discussion with or provide any confidential information or
data to any Person relating to an Acquisition Proposal, or engage
in any negotiations concerning an Acquisition Proposal, or
knowingly facilitate any effort or attempt to make or implement
an Acquisition Proposal, (iii) approve or recommend, or propose
publicly to approve or recommend, any Acquisition Proposal or
(iv) approve or recommend, or propose to approve or recommend, or
execute or enter into, any letter of intent, agreement in
principle, merger agreement, acquisition agreement, option
agreement or other similar agreement or propose publicly or agree
to do any of the foregoing related to any Acquisition Proposal.
(b) Notwithstanding the foregoing, XXX shall be permitted (i)
to the extent applicable, to comply with Rule 14d-9 and Rule 14e-
2 under the Exchange Act with regard to an Acquisition Proposal
and (ii) to engage in any discussions or negotiations with, or
provide any information to, any Person in response to an
unsolicited bona fide written Acquisition Proposal by any such
Person, if and only to the extent that, in any such case referred
to in clause (ii), (A) its Shareholders Meeting shall not have
occurred, (B), it has received an unsolicited bona fide written
Acquisition Proposal from a third party and its Board of
Directors concludes in good faith that such Acquisition Proposal
constitutes a Superior Proposal, (C) its Board of Directors,
after consultation with outside counsel, determines in good faith
that such action is necessary for the Board of Directors to
comply with its fiduciary duties under applicable law, (D) prior
to providing any information or data to any Person in
34
connection with an Acquisition Proposal by any such Person, its
Board of Directors receives from such Person an executed
confidentiality agreement having provisions that are customary in
such agreements, as advised by counsel, provided that if such
confidentiality agreement contains provisions that are less
restrictive with respect to disclosure of confidential
information of XXX than the comparable provision, or omits
restrictive provisions with respect to disclosure of confidential
information of XXX, contained in the Confidentiality Agreement,
then the Confidentiality Agreement will be deemed to be amended
to contain only such less restrictive provisions or to omit such
restrictive provisions, as the case may be, and (E) prior to
providing any information or data to any Person or entering into
discussions or negotiations with any Person, XXX notifies IBKC
promptly (within at least two days) of such inquiries, proposals
or offers received by, any such information requested from, or
any such discussions or negotiations sought to be initiated or
continued with, any of its representatives, indicating, in
connection with such notice, the name of such Person and the
material terms and conditions of any inquiries, proposals or
offers.
(c) XXX agrees that it will promptly keep IBKC informed of the
status and terms of any such proposals or offers (promptly
providing copies of such proposals and changes therein) and the
status and terms of any such discussions or negotiations and will
not enter into any confidentiality arrangements that prevent such
activities. Before XXX may take any action specified in clause
(b)(ii) above, XXX shall give IBKC at least two (2) business
days' notice, and shall not have received a proposal from IBKC
which is superior to the third party proposal under
consideration.
(d) XXX agrees that it will, and will cause its officers,
directors and representatives to, immediately cease and cause to
be terminated any activities, discussions or negotiations
existing as of the date of this Agreement with any parties
conducted heretofore with respect to any Acquisition Proposal,
informing them that the Board of Directors no longer seeks the
making of any Acquisition Proposals.
(e) XXX agrees that it will use reasonable best efforts to
promptly inform its directors, officers, key employees, agents
and representatives of the obligations undertaken in this Section
6.9. Nothing in this Section 6.9 shall (x) permit XXX to
terminate this Agreement (except as specifically provided in
Article IX hereof), (y) affect any other obligation of XXX under
this Agreement or (z) except with regard to an Acquisition
Proposal determined by the Board of Directors of XXX to be a
Superior Proposal, permit XXX to
35
submit to the vote of its stockholders any Acquisition Proposal
other than the Merger.
6.10 Agreement as to Efforts to Consummate. Subject to the
terms and conditions of this Agreement and its fiduciary duties
under applicable law, each of the Parties agrees to use its
reasonable best efforts to take, or cause to be taken, all
actions, and to do, or cause to be done, all things, necessary,
proper or advisable under applicable laws and regulations to
consummate and make effective, as soon as practicable after the
date of this Agreement, the transactions contemplated by this
Agreement, including, without limitation, using its best efforts
to lift or rescind any injunction or restraining order or other
order adversely affecting the ability of the Parties to
consummate the transactions contemplated hereby. Each of the
Parties shall use, and shall cause each of its Subsidiaries to
use, its reasonable best efforts to obtain consents of all third
parties and governmental bodies necessary or desirable for the
consummation of the transactions contemplated by this Agreement.
This section shall not require either Party to waive any
condition to such Party's obligation to consummate the Merger.
6.11 Operating Functions. The XXX Companies will cooperate with
IBKC in connection with planning for the efficient and orderly
combination of the parties and the operation of LBA Bank after
the Merger, and in the consolidation of appropriate operating
functions to be effective on the Effective Date, provided that
this covenant shall not require any action that, in the opinion
of ANA's Board, would adversely affect the operations of any XXX
Company if the Merger were not consummated.
6.12 Issuance of IBKC Stock. IBKC shall, prior to the Closing,
take such action as is required to permit the issuance of the
IBKC Common Stock issuable to the shareholders of XXX pursuant to
the Merger, and to permit such stock to be approved for listing
and quotation on the NASDAQ Stock Market.
6.13 Support Commitments. XXX has delivered to IBKC on the date
of this Agreement Support Commitments in the form of Exhibit V
from the directors and executive officers of XXX.
6.14 Bank Merger. XXX will, and will cause LBA Bank to, take
such action as IBKC shall deem necessary or advisable so that, on
a date after the Effective Time determined by IBKC, LBA Bank will
merge into IBERIABANK.
36
6.15 Exemption from Liability Under Section 16(b). Schedule
6.15 sets forth the names of XXX Insiders (as defined below) and
their corresponding shares of XXX Common Stock and XXX Options
for which such individuals are entitled to receive the Merger
Consideration. The Board of Directors of IBKC, or a committee of
"Non-Employee Directors" thereof (as such term is defined for
purposes of Rule 16b-3(d) under the 1934 Act), shall adopt a
resolution providing that the receipt by XXX Insiders of the
Merger Consideration in exchange for their respective shares of
XXX Common Stock and XXX Options as set forth in Schedule 6.15,
in each case pursuant to the transactions contemplated hereby and
to the extent such securities are listed in the Section 16
Information, is intended to be exempt from liability pursuant to
Section 16(b) under the 1934 Act. "Section 16 Information" shall
mean information accurate in all material respects regarding XXX
Insiders, the number of shares of XXX Common Stock held by each
such XXX Insider and expected to be exchanged for the Merger
Consideration, and the number and description of the XXX Options
held by each such XXX Insider. "XXX Insiders" shall mean those
officers and directors of XXX who are subject to the reporting
requirements of Section 16(a) of the 1934 Act and who are listed
in the Section 16 Information.
6.16 Organization of IBAC. IBKC shall cause IBAC to be
organized under the laws of Louisiana. The Board of IBAC shall
approve this Agreement and the Merger, whereupon IBAC shall
become a party to, and be bound by, this Agreement, and IBKC
shall adopt and ratify this Agreement in its capacity as the sole
shareholder of IBAC.
6.17 XXX Deposits. XXX will not increase the rate paid on its
deposits above those currently in effect except to the extent any
increased rate is no higher than the second highest rate then
being paid by its competitors in ANA's market, or offer or give
any premium for any deposit other than one no higher in value
than the second highest premium offered by competitors in its
marketplace.
37
SECTION VII.
ADDITIONAL AGREEMENTS
7.1 Registration Statement; Shareholder Approval.
(a) The Parties shall cooperate in the preparation of the
Registration Statement. IBKC shall, as soon as practicable, file
it with the SEC, and the Parties shall use their best efforts to
cause it to become effective under the 1933 Act. IBKC will take,
and XXX will cooperate with it in connection with, any action
required to be taken under the applicable state Blue Sky or
securities laws in connection with the issuance of shares of IBKC
Common Stock upon consummation of the Merger. Each party shall
furnish all information concerning it and the holders of its
capital stock as the other Party may reasonably request in
connection with such action.
(b) XXX shall call a Shareholders Meeting to be held as soon as
reasonably practicable after the date of this Agreement for the
purpose of voting upon the Merger. In connection with the
Shareholders Meeting, (i) XXX shall mail the Proxy Statement to
its shareholders, (ii) each Party shall furnish to the other
Party all information concerning it that the other Party may
reasonably request in connection with such Proxy Statement, (iii)
the Board of Directors of XXX shall recommend to its shareholders
the approval of this Agreement and the Merger Agreement, subject
to its fiduciary duties under applicable law, and (iv) XXX shall
otherwise use its best efforts to obtain such shareholders
approval, subject to its fiduciary duties under applicable law.
(c) This Section 7.1 shall not prohibit accurate disclosure by
a Party in any SEC Document (including the Proxy Statement and
the Registration Statement) and other disclosure to the extent
required by the Securities Laws or other applicable law if in the
opinion of the Board of Directors of such Party (as of the date
of such SEC Document or other disclosure) disclosure is required
as to transactions contemplated hereby or as to any proposal for
an Acquisition Transaction.
7.2 Filings with the State Offices. Promptly following, or
contempora-neous with, the Closing, the Parties will cause the
Merger Agreement to be filed with the Secretary of State of
Louisiana, and will cause to be made all such other filing as are
required by the BCL.
38
7.3 Tax Opinion. The Parties agree to use their reasonable
efforts to obtain a written opinion of Castaing Xxxxxx & Xxxxx
LLC, addressed to the Parties and reasonably satisfactory to
their respective counsel, dated the date of the Closing, subject
to the customary representations and assumptions, and
substantially to the effect that (a) the Merger will be treated
for Federal income tax purposes as a reorganization within the
meaning of Section 368(a)(1)(A) of the Code, and IBKC and XXX
will each be a party to the reorganization within the meaning of
Section 368(b) of the Code, (b) no gain or loss will be
recognized by IBKC and XXX as a result of the Merger, (c) a
shareholder of XXX who receives both IBKC Common Stock and cash
consideration in exchange for all of his or her shares of XXX
Common Stock generally will recognize gain, but not loss, to the
extent of the lesser of: (1) the excess, if any, of (a) the sum
of the aggregate fair market value of the IBKC Common Stock
received (including any fractional share of IBKC Common Stock
deemed to be received and exchanged for cash) and the amount of
cash received over (b) the shareholder's aggregate tax basis in
the shares of XXX Common Stock exchanged in the Merger; and
(2) the amount of cash received, (d) the aggregate tax basis of
the IBKC Common Stock received by shareholders of XXX who
exchange all of their XXX Common Stock in the Merger will equal
such shareholder's aggregate tax basis in the shares of XXX
Common Stock being exchanged, reduced by any amount allocable to
a fractional share interest of IBKC Common Stock for which cash
is received and by the amount of any cash consideration received,
and increased by the amount of taxable gain, if any recognized by
such shareholder in the Merger, (e) the holding period of the
shares of IBKC Common Stock received in the Merger will include
the period during which the shares of XXX Common Stock
surrendered in exchange therefor were held, provided such shares
of XXX Common Stock were held as capital assets at the Effective
Time.
7.4 Press Releases. Prior to the Effective Time, the Parties
shall give when practicable prior notice to each other as to the
form and substance of any press release or other public
disclosure materially related to this Agreement or any other
transaction contemplated hereby; provided, however, that nothing
in this Section 7.4 shall be deemed to prohibit a Party from
making any disclosure which its counsel deems necessary in order
to satisfy such Party's disclosure obligations imposed by law.
7.5 Applications. The Parties shall prepare and file
applications with the Federal Reserve, the State Regulatory
Commissioners and any other appropriate governmental authorities
seeking the approvals necessary to
39
consummate the transactions contemplated by this Agreement. The
Parties shall provide copies of all such filings to each other
within two business days after such filings are made and shall
promptly inform each other of all substantive regulatory contacts
concerning the transactions contemplated by this Agreement.
SECTION VIII.
CONDITIONS PRECEDENT TO OBLIGATIONS TO CONSUMMATE
The obligation of each Party to consummate the Merger is
subject to the satisfaction of each of the following conditions,
unless waived by such Party pursuant to Section 10.5 of this
Agreement:
8.1 Representations and Warranties. The representations and
warranties of the other Party set forth or referred to in this
Agreement shall be true and correct as of the date of this
Agreement and as of the time of the Closing with the same effect
as though all such representations and warranties had been made
on and as of the time of the Closing, in each case subject to the
standard set forth in Section 5.23 hereof, except (i) for any
such representations and warranties made as of a specified date,
which shall be true and correct as of such date or (ii) as
expressly contemplated or permitted by this Agreement.
8.2 Performance of Agreements and Covenants. Each and all of
the agreements and covenants of the other Party to be performed
and complied with pursuant to this Agreement and the other
agreements contemplated hereby prior to the time of the Closing
shall have been duly performed and complied with by it in all
material respects.
8.3 Certificates. Each of the Parties shall have delivered to
the other Party a certificate, dated as of the time of the
Closing and signed on its behalf by its chief executive officer
and its chief financial officer, to the effect that the
conditions of its obligations set forth in Section 8.1 and
Section 8.2 of this Agreement with respect to it have been
satisfied, all in such reasonable detail as the other Party shall
request.
8.4 Shareholder Approval. The shareholders of XXX shall have
approved this Agreement, the Merger Agreement, the Merger and the
consummation of the transactions contemplated hereby and thereby,
as and to the extent required by law and by the provisions of any
governing instruments, and
40
XXX shall have furnished to IBKC certified copies of resolutions
duly adopted by its shareholders evidencing the same.
8.5 Consents and Approvals. All material approvals and
authorizations of, filings and registrations with, and
notifications to, all Regulatory Authorities required for
consummation of the Merger and for the prevention of any
termination of any material right, privilege, license or
agreement of any Party or any of its 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. Any approval
obtained from any Regulatory Authority which is necessary to
consummate the transactions contemplated hereby shall not contain
any non-standard term or condition which in the reasonable
judgment of the Board of Directors of either of the Parties so
materially and adversely affects the economic or business
assumptions of the transactions contemplated by this Agreement as
to render inadvisable the consummation of the Merger. To the
extent that any lease, license, loan or financing agreement or
other contract or agreement to which any Party or any of its
Subsidiaries, as the case may be, is a party requires the consent
of or waiver from the other party thereto as a result of the
transactions contemplated by this Agreement, such consent or
waiver shall have been obtained, unless the failure to obtain
such consent or waiver would not, following the Merger, have a
Material Adverse Effect on such Party.
8.6 Legal Proceedings. No Party shall be subject to any order,
decree or injunction of a court or agency of competent
jurisdiction which enjoins or prohibits consummation of any of
the transactions contemplated by this Agreement.
8.7 Accountants' Letters. Each Party shall have received
"comfort" letters from the other Party's independent public
accountants dated, respectively, within three days prior to the
mailing of the Proxy Statement and the Closing Date, in form and
substance as are usual and customary for comfort letters of this
type.
8.8 Tax Matters. Each Party shall have received the tax opinion
addressed to it referred to in Section 7.3 of this Agreement.
8.9 Registration Statement. The Registration Statement shall be
effective under the 1933 Act and no stop orders suspending the
effectiveness of the Registration Statement shall be in effect
and no proceedings for such purpose shall be pending before or
threatened by the SEC.
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8.10 Simultaneous Transactions. The Closing shall have occurred
and the other Party shall have executed all documents and taken
all such other action as is necessary to effectuate the Merger
other than filing the Merger Agreement as referred to in Section
7.2, and each Party shall have irrevocably authorized its agents
to make such filing in its behalf.
8.11 Legal Opinions. Each Party shall have received an opinion,
substantially in the form of Exhibit VI-A or VI-B annexed hereto,
as applicable, from counsel for the other Party.
SECTION IX.
TERMINATION
9.1 Termination. Notwithstanding any other provision of this
Agreement or the Merger Agreement and notwithstanding the
approval of this Agreement and the Merger Agreement by the
shareholders of XXX, this Agreement and the Merger Agreement may
be terminated and the Merger abandoned at any time prior to the
Closing:
(a) By mutual consent of the Boards of Directors of IBKC and
XXX; or
(b) By the Board of Directors of a Party in the event of a
material breach by the other Party of any representation,
warranty, covenant or agreement of such other Party contained
herein which would result in the failure to satisfy the closing
condition set forth in Section 8.1 or 8.2 of this Agreement,
which breach cannot be or has not been cured within 30 days after
the giving of a written notice to the breaching Party of such
material breach; or
(c) By the Board of Directors of either Party in the event
that the Merger shall not have been consummated by March 31,
2003, except that if on such date any required regulatory or
shareholder approval has not been obtained, a Party who is not
otherwise in breach of this Agreement may extend such date one or
more times but not beyond June 30, 2003; or
(d) By the Board of Directors of either Party in the event
(i) any approval of any governmental or other Regulatory
Authority required for consummation of the Merger and the other
transactions contemplated hereby shall have been denied by final
non-appealable action of such authority or if any such action
taken by such authority is not appealed within the time limit for
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appeal or (ii) if the shareholders of XXX fail to have approved
this Agreement, the Merger Agreement and the Merger, as
applicable, and the consummation of the transactions contemplated
hereby and thereby, as applicable, at the Shareholders Meeting to
the extent required by law and by the provisions of any governing
instruments; or
(e) By the Board of Directors of a Party in the event that
any of the conditions precedent to the obligations of such Party
to consummate the Merger cannot be satisfied or fulfilled on or
before March 31, 2003 (other than required regulatory or
shareholder approval and other than by reason of a breach by the
Party seeking to terminate); or
(f) By the Board of Directors of a Party in the event of the
acquisition, by any person or group of persons, of beneficial
ownership of 25% or more of the outstanding shares of Common
Stock of the other Party (the terms "person", "group" and
"beneficial ownership" having the meanings assigned thereto in
Section 13(d) of the 1934 Act and the regulations promulgated
thereunder); or
(g) By the Board of Directors of IBKC if the Board of
Directors of XXX shall or shall have resolved to withdraw,
modify or change its recommendation to ANA's shareholders of
this Agreement, the Merger Agreement or the Merger, or
recommend any Acquisition Transaction other than the Merger; or
(h) By the Board of Directors of a Party if the other Party
has experienced or is reasonably likely to experience a Material
Adverse Effect, which is not remedied or cured within 30 days
after notice of intention to terminate is given by the Party
invoking this Section 9.1(h), which notice shall specify the
nature of the matter or matters constituting such Material
Adverse Effect and which are the basis of such intention;
provided that the right to terminate that is specified in such
notice of intention shall itself terminate unless notice of
termination is given by such Party within 15 days following the
end of such remedial or curative period; or
(i) By the Board of Directors of XXX if XXX Option Shares
shall have been issued pursuant to any exercise of the Stock
Option Agreement and, at the time scheduled for Closing, all or
any portion of such XXX Option Shares would not be cancelled in
accordance with Section 2.3(b) by virtue of the Merger.
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(j) By the Board of Directors of IBKC if the amount
designated as deposits, on the balance sheet of XXX as of the
date of the public announcement of this Agreement decreases by
15% or more between such announcement date and the day prior to
the Closing date determined in accordance with Section 3.1(a),
determined on the basis of either of the amount designated as
deposits on the day prior to the Closing date or the average
amount designated as deposits for the 60 day period ending the
day prior to the Closing date.
(k) By the Board of Directors of XXX, if the Market Value is
less than $30.00, subject, however to the following three
sentences. If XXX elects to exercise its termination right
pursuant to the immediately preceding sentence, it shall give
written notice to IBKC (provided that such notice of election to
terminate may be withdrawn within three days after it is given).
During the two-day period commencing with its receipt of such
notice, IBKC shall have the option of increasing the Cash
Consideration to be received by the holders of XXX Common Stock
hereunder by an amount equal to $30.00 minus the Market Value.
If IBKC makes an election contemplated by the preceding sentence
within such two-day period, it shall give prompt written notice
to XXX of such election and the revised amount of the Cash
Consideration, whereupon no termination shall have occurred
pursuant to this Section 9.1(k) and this Agreement shall remain
in effect in accordance with its terms (except as the Cash
Consideration shall have been so modified), and any references in
this Agreement to Cash Consideration shall thereafter be deemed
to refer to the Cash Consideration as adjusted pursuant to this
Section 9.1(k).
(l) At any time prior to the Shareholders Meeting, by XXX in
order to approve, accept or recommend an Acquisition Transaction
which has been received and considered by XXX and the XXX Board
and determined to be a Superior Proposal in compliance with
Section 6.9 hereof, provided, however, that this Agreement may be
terminated by XXX pursuant to this Section 9.1(l) only after the
third Business Day following IBKC's receipt of written notice
from XXX advising IBKC that XXX is prepared to approve, accept or
recommend such an Acquisition Transaction, and only if, during
such three-Business Day period, IBKC does not, in its sole
discretion, make an offer to XXX that the XXX Board determines in
good faith, after consultation with its financial and legal
advisors, is at least as favorable as such Superior Proposal.
9.2 Effect of Termination. In the event of the termination and
abandonment of this Agreement and the Merger Agreement pursuant to
44
Section 9.1 of this Agreement, this Agreement and the Merger
Agreement shall become void and have no effect and the Parties
will be relieved of all obligations and liabilities under this
Agreement and the Merger Agreement, except that (i) the
provisions of the last sentence of Section 6.4 and Section X of
this Agreement shall survive any such termination and
abandonment, (ii) the Stock Option Agreement shall be governed by
its own terms as to termination, (iii) a termination pursuant to
Section 9.1(b) or 9.1(e) or 9.1(g) of this Agreement shall not
relieve a breaching Party from liability for any breach giving
rise to such termination and (iv) the Parties shall remain
obligated under, and liable for any breach of, any of the
provisions of this Agreement that survive its termination.
9.3 Survival of Representations, Warranties and Covenants. The
respective representations, warranties, obligations, covenants
and agreements of the Parties shall not survive the Effective
Time except for (i) this Section 9.3, Section 2.3 and Section IV
of this Agreement and (ii) the Merger Agreement, provided that no
such representations, warranties or covenants shall be deemed to
be terminated or extinguished so as to deprive any Party (or any
director, officer or controlling person thereof) of any defense
in law or equity which otherwise would be available against the
claims of any person, including, without limitation, any
shareholder or former shareholder of any Party, the aforesaid
representations, warranties and covenants being material
inducements to consummation by the Parties of the transactions
contemplated hereby.
SECTION X.
MISCELLANEOUS
10.1 Expenses.
(a) Except as provided in Section 2.3(a) and Section 10.1(b) of
this Agreement, 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.
(b) Notwithstanding the foregoing, a Party (the "Expense Paying
Party") shall pay all of the costs and expenses, up to a maximum
of $250,000 incurred by the other Party (the "Reimbursed Party")
(without duplication pursuant to this Agreement or any other
agreement or instrument) in
45
connection with this Agreement and the transactions contemplated
hereunder, including fees and expenses of such Reimbursed Party's
financial or other consultants, investment bankers, accountants
and counsel, if:
(i) (a) this Agreement is terminated pursuant to Section
9.1(b) by reason of a material breach by the Expense Paying
Party, (b) the Reimbursed Party was the Party who terminated it,
and (c) the Expense Paying Party is at the time of the
termination not also entitled to terminate this Agreement
pursuant to Section 9.1(b) by reason of a material breach of the
Reimbursed Party; or
(ii) a Purchase Event occurs with respect to the Stock Option
Agreement if XXX is the Expense Paying Party and the Merger has
not been, or thereafter is not, consummated for any reason other
than a termination pursuant to Section 9.1(b) because of a
material breach by the Reimbursed Party.
Nothing contained in this Section 10.1(b) shall constitute or
shall be deemed to constitute liquidated damages for the breach
by a Party of the terms of this Agreement or otherwise limit the
rights of the nonbreaching Party.
(c) Final settlement with respect to payment of fees and
expenses by the Parties pursuant to Section 10.1 of this
Agreement shall be made within 30 days of the termination of this
Agreement and the Merger Agreement. If more than one Party is
responsible as an Expense Paying Party, then the costs and
expenses which the Expense Paying Parties are obligated to pay
shall be equally shared between them, regardless of whether their
relative degree of fault is or is not equal.
10.2 Brokers and Finders. Except as Previously Disclosed, each
of the Parties represents and warrants that neither it nor any of
its officers, directors, employees, affiliates or Subsidiaries
has employed any broker or finder or incurred any liability for
any financial advisory fees, investment bankers' fees, brokerage
fees, commissions or finders' fees in connection with this
Agreement or the transactions contemplated hereby. In the event
of a claim by any broker or finder based upon its representing or
being retained by or allegedly representing or being retained by
any Party, such Party agrees to indemnify and hold the other
Party harmless of and from such claim.
10.3 Entire Agreement. Except as otherwise expressly provided
herein, this Agreement, including the exhibits hereto, the Merger
Agreement, the
46
Stock Option Agreement and the Confidentiality Agreement contain
the entire agreement among the Parties with respect to the
transactions contemplated hereunder and thereunder, and such
agreements supersede all prior arrangements or understanding with
respect thereto, written or oral. The terms and conditions of
this Agreement shall inure to the benefit of and be binding upon
the Parties and their respective successors. Nothing in this
Agreement, expressed or implied, is intended to confer upon any
party, other than the Parties or their respective successors, any
rights, remedies, obligations or liabilities under or by reason
of this Agreement except for (i) the rights of shareholders of
XXX to receive the Merger Consideration following the Effective
Time and (ii) the provisions of Section 4.4, which shall inure to
the benefit of and be enforceable by the Persons referenced
therein.
10.4 Amendments. To the extent permitted by law, this Agreement
or the Merger Agreement may be amended by a subsequent writing
signed by each of the Parties upon the approval of the Boards of
Directors of such Parties; provided, however, that the provisions
of this Agreement and the Merger Agreement relating to the manner
or basis in which shares of XXX Common Stock will be exchanged
for IBKC Common Stock shall not be amended after the Shareholders
Meeting without the requisite approval of the holders of the
issued and outstanding shares of XXX Common Stock entitled to
vote thereon. The Parties may, without approval of their
respective Boards of Directors, make such technical changes to
this Agreement or the Merger Agreement, not inconsistent with the
purposes hereof and thereof, as may be required to effect or
facilitate any governmental approval or acceptance of the Merger
or of this Agreement or the Merger Agreement or to effect or
facilitate any filing or recording required for the consummation
of any of the transactions contemplated hereby or thereby.
10.5 Waivers. Prior to or at the Effective Time, each Party,
acting through its Board of Directors or chief executive officer
or other authorized officer, shall, as to such Party's rights
hereunder, have the right (i) to waive any default in the
performance of any term of this Agreement by the other Party,
(ii) to waive or extend the time for the compliance or
fulfillment by the other Party of any and all of its obligations
under this Agreement, and (iii) to waive any or all of the
conditions precedent to the obligations of such Party under this
Agreement.
10.6 No Assignment. Neither of the Parties may assign any of
its rights or obligations under this Agreement or the Merger
Agreement to any other
47
Person without the express written consent of the other Party
and any such purported assignment without such requisite consent
shall be null and void.
10.7 Notices. All notices or other communications which are
required or permitted hereunder shall be in writing and
sufficient if delivered by hand, by facsimile transmission or by
registered or certified mail, postage pre-paid, to the Persons at
the addresses set forth below (or at such other address as may be
provided hereunder), and shall be deemed to have been delivered
as of the date so delivered:
If to IBKC:
IBERIABANK Corporation
0000 Xxxxxxx Xxxx
Xxxxxxxxx, XX 00000-0000
Attention: Xxxxx X. Xxxx
With a copy to:
Xxxxxxx Xxxxxxx Xxxxxxx Xxxxxx Xxxxxxxx & Xxxxxxx, L.L.P.
000 Xx. Xxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, XX 00000-0000
Attention: Xxxxxxx X. Xxxxxxx, III
If to XXX:
Acadiana Bancshares, Inc.
000 X. Xxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attention: Xxxxxx Xxxxx
With a copy to:
Elias, Matz, Xxxxxxx & Xxxxxxx, L.L.P.
000 00xx Xxxxxx, X.X., 00xx Xxxxx
Xxxxxxxxxx, X.X. 00000
Attention: Xxxxxxx X. Xxxxxxx
10.8 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Louisiana
without regard to the conflict of laws principles thereof.
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10.9 Counterparts. This Agreement may be executed in one or
more counterparts, each of which shall constitute one and the
same instrument.
10.10 Captions. The captions contained in this Agreement are
for reference purposes only and are not part of this Agreement.
In Witness Whereof, each of the Parties has caused this
Agreement to be executed on its behalf and attested by officers
thereunto duly authorized all as of the day and year first above
written.
IBERIABANK Corporation
By /s/ Xxxxx X. Xxxx
--------------------------
Acadiana Bancshares, Inc.
By /s/ Xxxxxx X. Xxxxx
--------------------------
IBAC has joined as a party to this Agreement on this day of
September 22, 2002.
IBERIABANK Acquisition Corporation
By: /s/ Xxxxx X. Xxxx
-----------------
Xxxxx X. Xxxx
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