AGREEMENT AND PLAN OF SHARE EXCHANGE
OF
XXXXX BANKING COMPANY
AND
UNITED SECURITY BANCSHARES, INC.
TABLE OF CONTENTS
ARTICLE I
THE SHARE EXCHANGE
Section 1.1 Constituent Corporations; Consummation
of Share Exchange; Closing Date . . . . . . . . . . 1
Section 1.2 Effect of Share Exchange . . . . . . . . . 3
ARTICLE II
CONVERSION OF CAPITAL SHARES
Section 2.1 Manner of Conversion of Xxxxx Shares . . . 3
Section 2.2 Effectuating Conversion . . . . . . . . . 4
Section 2.3 Laws of Escheat. . . . . . . . . . . . . . 6
Section 2.4 Consideration. . . . . . . . . . . . . . . 6
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF XXXXX
Section 3.1 Corporate Organization . . . . . . . . . . 6
Section 3.2 Capitalization . . . . . . . . . . . . . . 7
Section 3.3 Financial Statements; Filings. . . . . . . 7
Section 3.4 Loan Portfolio . . . . . . . . . . . . . . 8
Section 3.5 Certain Loans and Related Matters. . . . . 8
Section 3.6 Authority; No Violation. . . . . . . . . . 9
Section 3.7 Consents and Approvals . . . . . . . . . . 10
Section 3.8 Broker's Fees. . . . . . . . . . . . . . . 10
Section 3.9 Absence of Certain Changes or Events . . . 10
Section 3.10 Legal Proceedings; Etc . . . . . . . . . . 10
Section 3.11 Taxes and Tax Returns. . . . . . . . . . . 10
Section 3.12 Employee Benefit Plans . . . . . . . . . . 11
Section 3.13 Title and Related Matters. . . . . . . . . 12
Section 3.14 Real Estate. . . . . . . . . . . . . . . . 12
Section 3.15 Environmental Matters. . . . . . . . . . . 13
Section 3.16 Commitments and Contracts. . . . . . . . . 14
Section 3.17 Regulatory Matters . . . . . . . . . . . . 14
Section 3.18 Registration Obligations . . . . . . . . . 14
Section 3.19 Insurance. . . . . . . . . . . . . . . . . 15
Section 3.20 Labor. . . . . . . . . . . . . . . . . . . 15
Section 3.21 Compliance with Laws . . . . . . . . . . . 15
Section 3.22 Transactions with Management . . . . . . . 15
Section 3.23 Proxy Materials. . . . . . . . . . . . . . 16
Section 3.24 Deposit Insurance. . . . . . . . . . . . . 16
Section 3.25 Untrue Statements and Omissions. . . . . . 16
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF
USB
Section 4.1 Organization and Related Matters of USB. . 16
Section 4.2 Organization and Related Matters of USB-
Bank . . . . . . . . . . . . . . . . . . . . . . . . 17
Section 4.3 Capitalization . . . . . . . . . . . . . . 17
Section 4.4 Authorization. . . . . . . . . . . . . . . 17
Section 4.5 Consents and Approvals . . . . . . . . . . 18
Section 4.6 Regulatory Matters . . . . . . . . . . . . 18
Section 4.7 Proxy Materials. . . . . . . . . . . . . . 18
Section 4.8 No Broker's or Finder's Fees . . . . . . . 18
ARTICLE V
COVENANTS AND AGREEMENTS
Section 5.1 Conduct of the Business of Xxxxx . . . . . 18
Section 5.2 Current Information. . . . . . . . . . . . 20
Section 5.3 Access to Properties; Personnel and
Records. . . . . . . . . . . . . . . . . . . . . . . 21
Section 5.4 Approval of Xxxxx Shareholders . . . . . . 21
Section 5.5 No Other Bids. . . . . . . . . . . . . . . 22
Section 5.6 Notice of Deadlines. . . . . . . . . . . . 22
Section 5.7 Maintenance of Properties. . . . . . . . . 22
Section 5.8 Compliance Matters . . . . . . . . . . . . 22
Section 5.9 Title Insurance. . . . . . . . . . . . . . 22
Section 5.10 Survey . . . . . . . . . . . . . . . . . . 22
Section 5.11 Subsidiary Merger Agreement. . . . . . . . 23
ARTICLE VI
ADDITIONAL COVENANTS AND AGREEMENTS
Section 6.1 Best Efforts; Cooperation. . . . . . . . . 23
Section 6.2 Regulatory Matters . . . . . . . . . . . . 23
Section 6.3 Other Matters. . . . . . . . . . . . . . . 23
Section 6.4 Indemnification. . . . . . . . . . . . . . 24
ARTICLE VII
MUTUAL CONDITIONS TO CLOSING
Section 7.1 Shareholder Approval . . . . . . . . . . . 25
Section 7.2 Regulatory Approvals . . . . . . . . . . . 25
Section 7.3 Litigation . . . . . . . . . . . . . . . . 25
Section 7.4 Proxy Statement. . . . . . . . . . . . . . 25
ARTICLE VIII
CONDITIONS TO THE OBLIGATIONS OF USB
Section 8.1 Representations and Warranties . . . . . . 26
Section 8.2 Performance of Obligations . . . . . . . . 26
Section 8.4 Absence of Adverse Facts . . . . . . . . . 26
Section 8.5 Opinion of Counsel . . . . . . . . . . . . 26
Section 8.6 Consents Under Agreements. . . . . . . . . 26
Section 8.7 Material Condition . . . . . . . . . . . . 26
Section 8.8 Outstanding Shares of Xxxxx. . . . . . . . 27
Section 8.9 Noncompetition Agreements. . . . . . . . . 27
Section 8.10 Survey; Title Insurance. . . . . . . . . . 27
Section 8.11 Dissenters . . . . . . . . . . . . . . . . 27
Section 8.12 Certification of Claims. . . . . . . . . . 27
ARTICLE IX
CONDITIONS TO OBLIGATIONS OF XXXXX
Section 9.1 Representations and Warranties . . . . . . 27
Section 9.2 Performance of Obligations . . . . . . . . 27
Section 9.3 Certificate Representing Satisfaction of
Conditions . . . . . . . . . . . . . . . . . . . . . 28
Section 9.4 Consents Under Agreements. . . . . . . . . 28
ARTICLE X
TERMINATION, WAIVER AND AMENDMENT
Section 10.1 Termination. . . . . . . . . . . . . . . . 28
Section 10.2 Effect of Termination. . . . . . . . . . . 29
Section 10.3 Amendments . . . . . . . . . . . . . . . . 29
Section 10.4 Waivers. . . . . . . . . . . . . . . . . . 29
Section 10.5 Survival of Representations and
Warranties . . . . . . . . . . . . . . . . . . . . . 29
ARTICLE XI
MISCELLANEOUS
Section 11.1 Entire Agreement . . . . . . . . . . . . . 29
Section 11.2 Notices. . . . . . . . . . . . . . . . . . 29
Section 11.3 Severability . . . . . . . . . . . . . . . 30
Section 11.4 Costs and Expenses . . . . . . . . . . . . 30
Section 11.5 Captions . . . . . . . . . . . . . . . . . 31
Section 11.6 Counterparts . . . . . . . . . . . . . . . 31
Section 11.7 Governing Law. . . . . . . . . . . . . . . 31
Section 11.8 Persons Bound; No Assignment . . . . . . . 31
Section 11.9 Exhibits and Schedules . . . . . . . . . . 31
Section 11.10 Waiver. . . . . . . . . . . . . . . . . . . 31
Section 11.11 Construction of Terms . . . . . . . . . . . 31
AGREEMENT AND PLAN OF SHARE EXCHANGE
OF
XXXXX BANKING COMPANY
AND
UNITED SECURITY BANCSHARES, INC.
This AGREEMENT AND PLAN OF SHARE EXCHANGE, dated as of
the 15th day of January, 1996 (this "Agreement"), by and between
Xxxxx Banking Company, an Alabama banking corporation ("Brent") and
United Security Bancshares, Inc., an Alabama corporation ("USB").
WITNESSETH THAT:
WHEREAS, the respective Boards of Directors of USB and
Xxxxx xxxx it in the best interests of USB and of Xxxxx,
respectively, and of their respective shareholders, that USB
acquire by operation of law all of the issued and outstanding
capital stock of Xxxxx pursuant to this Agreement (the "Share
Exchange");
WHEREAS, the Boards of Directors of USB and Xxxxx have
approved this Agreement, and the Board of Directors of Xxxxx has
directed that this Agreement be submitted to shareholders of Xxxxx
for approval and adoption in accordance with applicable laws;
WHEREAS, it is contemplated that immediately following
the consummation of this Agreement that Xxxxx shall be merged with
and into United Security Bank, an Alabama banking corporation and
a wholly-owned subsidiary of USB ("USB-Bank");
NOW, THEREFORE, in consideration of the premises and the
mutual covenants, representations, warranties and agreements herein
contained, the parties agree that all of the issued and outstanding
capital stock of Xxxxx will be acquired by USB in a statutory share
exchange and that the terms and conditions of the Share Exchange,
the mode of carrying the Share Exchange into effect, including the
manner of exchanging the shares of common stock of Xxxxx, par value
$100.00 per share, held by shareholders of Xxxxx for cash, shall be
as hereinafter set forth.
ARTICLE I
THE SHARE EXCHANGE
Section 1.1 Constituent Corporations; Consummation of Share
Exchange; Closing Date. (a) Subject to the provisions hereof, all
of the issued and outstanding shares of capital stock of Xxxxx
shall be acquired by USB (which has heretofore and shall
hereinafter be referred to as the "Share Exchange") pursuant to
Sections 10-2B-11.02 through 10-2B-11.06 of the Alabama Business
Corporation Act (the "ABCA") and the corporate existence of Xxxxx
shall continue (sometimes hereinafter referred to as "Surviving
Corporation" when reference is made to it after the Effective Time
of the Share Exchange (as defined below)). The Share Exchange
shall become effective on the date and at the time on which the
Share Exchange is deemed effective by each of the Regulatory
Authorities (as defined below), including the approval of the
Superintendent of Banks of Alabama, and appropriate Articles of
Share Exchange are filed with the appropriate authorities (such
time is hereinafter referred to as the "Effective Time of the Share
Exchange"). Subject to the terms and conditions hereof, unless
otherwise agreed upon by USB and Xxxxx, the Effective Time of the
Share Exchange shall occur on the 1st business day following the
later to occur of (i) the effective date (including expiration of
any applicable waiting period) of the last required Consent (as
defined below) of any Regulatory Authority having authority over
the transactions contemplated under the Share Exchange Agreement
and (ii) the date on which the shareholders of Xxxxx, to the extent
that their approval is required by applicable law, approve the
transactions contemplated by this Agreement. As used in this
Agreement, "Consent" shall mean a consent, approval or
authorization, waiver, clearance, exemption or similar affirmation
by any person pursuant to any contract, permit, law, regulation or
order, and "Regulatory Authorities" shall mean, collectively, the
Federal Trade Commission (the "FTC"), the United States Department
of Justice (the "Justice Department"), the Federal Deposit
Insurance Corporation (the "FDIC"), and all state regulatory
agencies having jurisdiction over the parties, including the
Alabama State Banking Department (the "Department").
(b) The closing of the Share Exchange (the
"Closing") shall take place at the principal offices of Xxxxx at
10:00 a.m. local time on the day that the Effective Time of the
Share Exchange occurs, or such other date and time and place as the
parties hereto may agree (the "Closing Date"). Subject to the
provisions of this Agreement, at the Closing there shall be
delivered to each of the parties hereto the opinions, certificates
and other documents and instruments required to be so delivered
pursuant to this Agreement.
(c) The main office of Brent is located at 000 Xxxx
Xxxxxx, Xxxxx, Xxxxxxx 00000.
(d) The proposed main office of the Surviving
Corporation shall be located at 000 Xxxx Xxxxxx, Xxxxx, Xxxxxxx
00000.
(e) From and after the Effective Time of the Share
Exchange, until replaced pursuant to applicable laws and under the
provisions of the Articles of Incorporation and Bylaws of the
Surviving Corporation, the directors of the Surviving Corporation
shall be those persons named in Exhibit 1.1(e), which is annexed
hereto, and the officers of the Surviving Corporation shall be
those persons who shall be designated in writing by USB at or prior
to the Effective Time of the Share Exchange. The current officers
and directors of Xxxxx who are not designated by USB to serve as
officers and directors of the Surviving Corporation shall deliver
their resignations as officers and directors of Xxxxx to USB as of
the Effective Time of the Share Exchange.
(f) After the Effective Time of the Share Exchange,
the Surviving Corporation shall have 4,000 shares of Common Stock,
par value $100 per share, authorized, 4,000 shares of which shall
be issued and outstanding and no shares of which shall be held as
treasury stock. The total amount of capital stock of the Surviving
Corporation shall be $400,000, and the total capital of the
Surviving Corporation shall consist of such capital stock, plus the
combined capital and surplus of Xxxxx (including unrealized losses
on securities available for resale).
(g) As of December 31, 1994, Xxxxx had total
capital of $400,000 divided into 4,000 shares of authorized Common
Stock, par value $100.00, 4,000 of which are issued and outstanding
and none of which are held as treasury stock, and combined capital
and surplus and undivided profits, including unrealized losses on
securities available for resale, of
$5,590,617.
(h) The Surviving Corporation shall not have trust
powers.
(i) The Articles of Incorporation under which the
Surviving Corporation will operate are the current Articles of
Incorporation of Xxxxx as of the EffectiveTime of the Share
Exchange, a copy of which are attached hereto as Exhibit 1.1(i).
Section 1.2 Effect of Share Exchange. From and after the
Effective Time of the Share Exchange:
(a) All issued and outstanding capital stock of
Xxxxx, subject to the rights of dissent prescribed by law, shall
immediately, by operation of law, and without any further
conveyance or transfer, become the property of USB;
(b) The business presently conducted by Xxxxx
shall, subject to the actions of the board of directors and
officers of Xxxxx and consummation of the contemplated merger
agreement with USB-Bank shall after the Effective Time of the Share
Exchange continue to be conducted by USB as a wholly owned
subsidiary of USB;
(c) The Surviving Corporation shall continue to
have all the rights, privileges, immunities and powers and shall be
subject to all the duties and liabilities of a banking corporation
organized under the laws of the State of Alabama. No rights or
obligations of the Surviving Corporation shall be affected or
impaired by the Share Exchange; and
(d) The shareholders of Xxxxx, as of the Effective
Time of the Share Exchange, shall have the rights set forth in
Article II hereof.
ARTICLE II
CONVERSION OF CAPITAL SHARES
Section 2.1 Manner of Conversion of Xxxxx Shares. Subject
to the provisions hereof, as of the Effective Time of the Share
Exchange and by virtue of the Share Exchange and without any
further action on the part of the holder of any shares of common
stock of Xxxxx, par value $100.00 (the "Xxxxx Shares"):
(a) All Xxxxx Shares which are held by Xxxxx as
treasury stock, if any, shall be canceled and
retired and no consideration shall be paid or
delivered in exchange therefor.
(b) Subject to the terms and conditions of this
Agreement and except with regard to Dissenting
Xxxxx Shares, each Xxxxx Share outstanding
immediately prior to the Effective Time of the
Share Exchange shall be canceled and converted
into the right to receive $1,762.50 in cash
(the "Cash Consideration"), and all
outstanding certificates representing Xxxxx
Shares shall thereafter represent solely the
right to receive the Cash Consideration.
(c) Each outstanding Xxxxx Share, the holder of
which has demanded and perfected his demand
for payment of the "fair value" of such share
in accordance with Sections 10-2B-13.01
through 10-2B-13.32 of the ABCA (the "Dissent
Provisions"), and has not effectively
withdrawn or lost his right to such appraisal
(the "Dissenting Bank Shares"), shall not be
converted into or represent a right to receive
the Cash Consideration payable in the Share
Exchange but the holder thereof shall be
entitled only to such rights as are granted by
the Dissent Provisions. Xxxxx shall give USB
prompt notice upon receipt by Xxxxx of any
written objection to the Share Exchange and
any written demands for payment of the fair
value of the Xxxxx Shares, and of withdrawals
of such demands, and any other instruments
provided to Xxxxx pursuant to the Dissent
Provisions (any shareholder duly making such
demand being hereinafter called a "Dissenting
Shareholder"). Each Dissenting Shareholder
who becomes entitled, pursuant to the Dissent
Provisions, to payment of fair value for any
Xxxxx Shares held by such Dissenting
Shareholder shall receive payment therefor
from the Surviving Corporation,(but only after
the amount thereof shall have been agreed upon
or at the times and in the amounts required by
the Dissent Provisions) and all of such
Dissenting Shareholder's Xxxxx Shares shall be
canceled. Neither Xxxxx nor the Surviving
Corporation shall, except with the prior
written consent of USB, voluntarily make any
payment with respect to, or settle or offer to
settle, any demand for payment by any
Dissenting Shareholder. If any Dissenting
Shareholder shall have failed to perfect or
shall have effectively withdrawn or lost such
right to demand payment of fair value, the
Xxxxx Shares held by such Dissenting
Shareholder shall thereupon be deemed to have
been converted into the right to receive the
Cash Consideration to be paid in the Share
Exchange as provided by this Agreement.
Section 2.2 Effectuating Conversion (a) USB shall send or
cause to be sent to each holder of record of Xxxxx Shares
transmittal materials (the "Letter of Transmittal") for use in
exchanging their certificates representing Xxxxx Shares for the
Cash Consideration provided for in this Agreement. As promptly as
practicable after receipt of properly completed Letters of
Transmittal and stock certificates evidencing the Xxxxx Shares held
by the holders of the Xxxxx Shares, USB shall disburse the
appropriate Cash Consideration on behalf of USB-Bank. If such
Letter of Transmittal is properly presented immediately after the
Effective Time of the Share Exchange at the place of the Closing,
payment shall be made contemporaneously. Amounts that would have
been payable to Dissenting Shareholders for the Xxxxx Shares but
for the fact of their dissent in accordance with the provisions of
Section 2.1(c) hereof shall be administered in accordance with the
Dissent Provisions.
(b) At the Effective Time of the Share Exchange, the
stock transfer books of Xxxxx shall be closed as to holders of
Xxxxx Shares immediately prior to the Effective Time of the Share
Exchange and no transfer of Xxxxx Shares by any such holder shall
thereafter be made or recognized and each outstanding certificate
formerly representing Xxxxx Shares shall, without any action on the
part of any holder thereof, no longer represent Xxxxx Shares. If,
after the Effective Time of the Share Exchange, certificates are
properly presented to USB, such certificates shall be exchanged for
the Cash Consideration contemplated by this Agreement into which
the Xxxxx Shares represented thereby were converted in the Share
Exchange.
(c) In the event that any holder of Xxxxx Shares is
unable to deliver the certificate which represents such xxxxxx'x
Xxxxx Shares, USB, in the absence of actual notice that any Xxxxx
Shares theretofore represented by any such certificate have been
acquired by a bona fide purchaser, may, in its discretion, deliver
to such holder the Cash Consideration contemplated by this
Agreement to which such holder is entitled in accordance with the
provisions of this Agreement upon the presentation of all of the
following:
(i) An affidavit or other evidence to
the reasonable satisfaction of USB
that any such certificate has been
lost, wrongfully taken or destroyed;
(ii) Such security and indemnity as may
be reasonably requested by USB to
indemnify and hold USB harmless,
including without limitation an
appropriate lost security bond; and
(iii)Evidence to the satisfaction of USB that
such holder is the owner of the Xxxxx
Shares theretofore represented by each
certificate claimed by such holder to be
lost, wrongfully taken or destroyed and
that such holder is the person who would
be entitled to present each such
certificate for exchange pursuant to this
Agreement.
(d) In the event that the delivery of the Cash
Consideration contemplated by this Agreement is to be made to a
person other than the person in whose name any certificate
representing Xxxxx Shares surrendered is registered, such
certificate so surrendered shall be properly endorsed (or
accompanied by an appropriate instrument of transfer), with the
signature(s) appropriately guaranteed, and otherwise in proper form
for transfer, and the person requesting such delivery shall pay any
transfer or other taxes required by reason of the delivery to a
person other than the registered holder of such certificate
surrendered or establish to the satisfaction of USB that such tax
has been paid or is not applicable.
(e) Until surrendered in accordance with the provisions
of this Section 2.2, each certificate representing Xxxxx Shares
shall represent for all purposes the right to receive the Cash
Consideration contemplated by this Agreement and shall not
represent the right to receive any other consideration, including,
but not limited to, dividends of Xxxxx or interest with respect to
such Cash Consideration.
Section 2.3 Laws of Escheat. If any of the consideration
due to be paid or delivered to the holders of Xxxxx Shares is not
paid or delivered within the time period specified by any
applicable laws concerning abandoned property, escheat or similar
laws, and if such failure to pay or deliver such consideration
occurs or arises out of the fact that such property is not claimed
by the proper owner thereof, USB shall be entitled to dispose of
any such consideration or other payments in accordance with
applicable laws concerning abandoned property, escheat or similar
laws. Any other provision of this Agreement notwithstanding, none
of Xxxxx, USB, USB-Bank, nor any other person acting on their
behalf shall be liable to a holder of Xxxxx Shares for any amount
paid or property delivered in good faith to a public official
pursuant to and in accordance with any applicable abandoned
property, escheat or similar law.
Section 2.4 Consideration. USB shall pay or cause to be
paid, on behalf of USB-Bank, the Cash Consideration as and when the
same shall be required to be paid pursuant to this Agreement.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF XXXXX
Xxxxx hereby represents and warrants to USB-Bank and USB as
follows as of the date hereof and as of all times up to and
including the Effective Time of the Share Exchange (except as
otherwise provided):
Section 3.1 Corporate Organization. (a) Xxxxx is a banking
corporation duly organized, validly existing and in good standing
under the laws of the State of Alabama. Xxxxx has the corporate
power and authority to own or lease all of its properties and
assets and to carry on its business as such business is now being
conducted, and Xxxxx is duly licensed or qualified to do business
in Alabama and elsewhere where the nature of the business conducted
by it or the character or location of the properties and assets
owned or leased by it make such qualification necessary, except
where the failure to be so licensed or qualified would not have a
material adverse effect on the business, assets, operations,
financial condition or results of operations (such business,
assets, operations, financial condition or results of operations
hereinafter collectively referred to as the "Condition") of Xxxxx.
True and correct copies of the Articles of Incorporation of Xxxxx
and the Bylaws of Xxxxx, each as amended to the date hereof, have
been delivered to USB.
(b) Xxxxx has in effect all federal, state, local and
foreign governmental, regulatory and other authorizations, permits
and licenses necessary for each of them to own or lease its
properties and assets and to carry on its business as now
conducted, the absence of which, either individually or in the
aggregate, would have a material adverse effect on the Condition of
Xxxxx.
(c) Xxxxx does not own any capital stock of any
subsidiary and Xxxxx does not have any interest in any partnership
or joint venture. For purposes of this Agreement, a "subsidiary"
means any corporation or other entity of which the party referred
to beneficially owns, controls, or has the power to vote, directly
or indirectly, more than 5% of the outstanding equity securities.
(d) The minute books of Xxxxx contain complete and
accurate records in all material respects of all meetings and other
corporate actions held or taken by its shareholders and Board of
Directors (including all committees thereof).
Section 3.2 Capitalization. The authorized capital stock
of Xxxxx consists of 4,000 shares of common stock, par value
$100.00 (hereinbefore and hereinafter referred to as "Xxxxx
Shares"), 4,000 shares of which as of the date hereof are issued
and outstanding (none of which is held in the treasury of Xxxxx).
All of the issued and outstanding Xxxxx Shares have been duly
authorized and validly issued and all such shares are fully paid
and nonassessable. There are no outstanding options, warrants,
commitments, or other rights or instruments to purchase or acquire
any shares of capital stock of Xxxxx, or any securities or rights
convertible into or exchangeable for shares of capital stock of
Xxxxx.
Section 3.3 Financial Statements; Filings. (a) Xxxxx has
previously delivered to USB copies of the financial statements of
Xxxxx as of and for the years ended 1992, 1993 and 1994 and the
financial statements of Xxxxx as of and for the periods ended March
31, 1995, June 30, 1995, and September 30, 1995 and Xxxxx shall
deliver to USB, as soon as practicable following the preparation of
additional financial statements for each subsequent calendar
quarter (or other reporting period) or year of Xxxxx, the financial
statements of Xxxxx as of and for such subsequent calendar quarter
(or other reporting period) or year (such financial statements,
unless otherwise indicated, being hereinafter referred to
collectively as the "Financial Statements of Xxxxx").
(b) Xxxxx has previously delivered to USB copies of the
Call Reports of Xxxxx as of and for the years ended 1992, 1993 and
1994 and the Call Reports of Xxxxx as of and for the periods ended
March 31, 1995, June 30, 1995, and September 30, 1995 and Xxxxx
shall deliver to USB, as soon as practicable following the
preparation of additional Call Reports for each subsequent calendar
quarter (or other reporting period) or year of Xxxxx, the Call
Reports of Xxxxx as of and for each such subsequent calendar
quarter (or other reporting period) or year (such Call Reports,
unless otherwise indicated, being hereinafter referred to
collectively as the "Call Reports of Xxxxx").
(c) Each of the Financial Statements of Xxxxx and each of
the Call Reports of Xxxxx (including the related notes, where
applicable) have been or will be prepared in all material respects
in accordance with generally accepted accounting principles or
regulatory accounting principles, whichever is applicable, which
principles have been or will be consistently applied during the
periods involved, except as otherwise noted therein, and the books
and records of Xxxxx have been, are being, and will be maintained
in all material respects in accordance with applicable legal and
accounting requirements consistent with past practices and reflect
only actual transactions. Each of the Financial Statements of
Xxxxx and each of the Call Reports of Xxxxx (including the related
notes, where applicable) fairly present or will fairly present the
financial position of Xxxxx as of the respective dates thereof and
fairly present or will fairly present the results of operations of
Xxxxx for the respective periods therein set forth.
(d) To the extent not prohibited by law, Xxxxx has
heretofore delivered or made available, or caused to be delivered
or made available, to USB all reports and filings made or required
to be made by Xxxxx, with the Regulatory Authorities, and will from
time to time hereafter furnish to USB, upon filing or furnishing
the same to the Regulatory Authorities, all such reports and
filings made after the date hereof with the Regulatory Authorities.
As of the respective dates of such reports and filings, all such
reports and filings did not and shall not contain any untrue
statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made,
not misleading.
(e) Except as reflected on Disclosure Schedule 3.3(e)
hereto, since December 31, 1994, Xxxxx has not incurred any
obligation or liability (contingent or otherwise) that has or might
reasonably be expected to have, individually or in the aggregate,
a material adverse effect on the Condition of Xxxxx except
obligations and liabilities (i) which are accrued or reserved
against in the Financial Statements of Xxxxx or the Call Reports of
Xxxxx, or reflected in the notes thereto, (ii) which were incurred
after December 31, 1994, in the ordinary course of business
consistent with past practices, or (iii) contemplated by this
Agreement or incurred with the written consent of USB.
Section 3.4 Loan Portfolio. Except as set forth in
Disclosure Schedule 3.4, (i) all evidences of indebtedness in
original principal amount in excess of $5,000 reflected as assets
in the Financial Statements of Xxxxx and the Call Reports of Xxxxx
as of and for the year ended December 31, 1994 and the period ended
September 30, 1995 were as of such dates in all respects the
binding obligations of the respective obligors named therein in
accordance with their respective terms, (ii) the allowances for
possible loan losses shown on the Financial Statements of Xxxxx and
the Call Reports of Xxxxx as of and for the year ended December 31,
1994 and the period ended September 30, 1995 were, and the
allowance for possible loan losses to be shown on the Financial
Statements of Xxxxx and the Call Reports of Xxxxx as of any date
subsequent to the execution of this Agreement will be, as of such
dates, adequate to provide for possible losses, net of recoveries
relating to loans previously charged off, in respect of loans
outstanding (including accrued interest receivable) of Xxxxx and
other extensions of credit (including letters of credit or
commitments to make loans or extend credit), and (iii) each such
allowance described in (ii) above has been established in
accordance with the accounting principles described in Section
3.3(c).
Section 3.5 Certain Loans and Related Matters. Except as
set forth in Disclosure Schedule 3.5, Xxxxx is not a party as of
the date hereof to any written or oral: (i) loan agreement, note or
borrowing arrangement, other than credit card loans and other loans
the unpaid balance of which does not exceed $5,000 per loan, under
the terms of which the obligor is sixty (60) days delinquent in
payment of principal or interest or in default of any other
provision as of the date hereof; (ii) loan agreement, note or
borrowing arrangement which has been classified as "substandard,"
"doubtful," "loss," or any comparable classifications; (iii) loan
agreement, note or borrowing arrangement, including any loan
guaranty, with any director or executive officer of Xxxxx or any
ten percent (10%) shareholder of Xxxxx, or any person, corporation
or enterprise controlling, controlled by or under common control
with any of the foregoing; or (iv) loan agreement, note or
borrowing arrangement in violation of any law, regulation or rule
applicable to Xxxxx including, but not limited to, those
promulgated, interpreted or enforced by any of the Regulatory
Authorities and which violation could have a material adverse
effect on the Condition of Xxxxx. As of the date of any Financial
Statement of Xxxxx and any Call Report of Xxxxx subsequent to the
execution of this Agreement, including the date of the Financial
Statements of Xxxxx and the Call Reports of Xxxxx that immediately
precede the Effective Time of the Share Exchange, there shall not
have been any material increase in the loan agreements, notes or
borrowing arrangements described in (i) through (iv) above and
Disclosure Schedule 3.5.
Section 3.6 Authority; No Violation. (a) Xxxxx has full
corporate power and authority to execute and deliver this Agreement
and, subject to the approval of the shareholders of Xxxxx and to
the receipt of the Consents of the Regulatory Authorities, to
consummate the transactions contemplated hereby. The Board of
Directors of Xxxxx has duly and validly approved this Agreement and
the transactions contemplated hereby, has authorized the execution
and delivery of this Agreement, has directed that this Agreement
and the transactions contemplated hereby be submitted and
recommended to Brent's shareholders for approval at a meeting of
such shareholders and, except for the adoption of such Agreement by
its shareholders, no other corporate proceedings on the part of
Xxxxx are necessary to consummate the transactions so contemplated.
This Agreement, when duly and validly executed by Xxxxx and
delivered by Xxxxx, will constitute a valid and binding obligation
of Xxxxx, and will be enforceable against Xxxxx in accordance with
its terms, except as such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting the enforcement of creditors rights
generally and except that the availability of the equitable remedy
of specific performance or injunctive relief is subject to the
discretion of the court before which any proceeding may be brought.
(b) Neither the execution and delivery of this Agreement
by Xxxxx nor the consummation by Xxxxx of the transactions
contemplated hereby, nor compliance by Xxxxx with any of the terms
or provisions hereof, will (i) violate any provision of the
Articles of Incorporation or Bylaws of Xxxxx (ii) assuming that the
Consents of the Regulatory Authorities and approvals referred to
herein are duly obtained, violate any statute, code, ordinance,
rule, regulation, judgment, order, writ, decree or injunction
applicable and material to Xxxxx or any of its properties or
assets, or (iii) violate, conflict with, result in a breach of any
provisions of, constitute a default (or an event which, with notice
or lapse of time, or both, would constitute a default) under,
result in the termination of, accelerate the performance required
by or result in the creation of any lien, security interest, charge
or other encumbrance upon any of the properties or assets of Xxxxx
under, any of the terms, conditions or provisions of any material
note, bond, mortgage, indenture, deed of trust, license, permit,
lease, agreement or other instrument or obligation to which Xxxxx
is a party, or by which Xxxxx or any of its properties or assets
may be bound or affected.
Section 3.7 Consents and Approvals. Except for (i) the
Consents of the FDIC and the Department; (ii) approval of this
Agreement by the shareholders of Xxxxx; (iii) filing of Articles of
Share Exchange with the Alabama Secretary of State; (iv) the filing
of this Agreement and certified resolutions with the Department;
and (v) as set forth in Disclosure Schedule 3.7, no Consents of any
person are necessary in connection with the execution and delivery
by Xxxxx of this Agreement, and the consummation by Xxxxx of the
Share Exchange and the other transactions contemplated hereby.
Section 3.8 Broker's Fees. Neither Xxxxx nor any of its
officers or directors, has employed any broker or finder or
incurred any liability for any broker's fees, commissions or
finder's fees in connection with any of the transactions
contemplated by this Agreement.
Section 3.9 Absence of Certain Changes or Events. Except
as occasioned by this Agreement or with the consent of USB, since
December 31, 1994, there has not been (i) any declaration, payment
or setting aside of any dividend or distribution (whether in cash,
stock or property) in respect of the Xxxxx Shares or (ii) any
change or any event involving a prospective change in the Condition
of Xxxxx which has had, or is reasonably likely to have, a material
adverse effect on the Condition of Xxxxx or on Xxxxx generally,
including, without limitation any change in the administration or
supervisory standing or rating of Xxxxx with any Regulatory
Authority, and no fact or condition exists as of the date hereof
which might reasonably be expected to cause any such event or
change in the future.
Section 3.10 Legal Proceedings; Etc. Except as set forth in
Disclosure Schedule 3.10, Xxxxx is not a party to any, and there
are no pending or threatened, judicial, administrative, arbitral or
other proceedings, claims, actions, causes of action or
governmental investigations against Xxxxx challenging the validity
of the transactions contemplated by this Agreement and, as of the
date hereof, there is no material proceeding, claim, action or
governmental investigation against Xxxxx; no judgment, decree,
injunction, rule or order of any court, governmental department,
commission, agency, instrumentality or arbitrator is outstanding
against Xxxxx which has a material adverse effect on the Condition
of Xxxxx; there is no default by Xxxxx under any material contract
or agreement to which Xxxxx is a party; and Xxxxx is not a party to
any agreement, order or memorandum in writing by or with any
Regulatory Authority restricting the operations of Xxxxx and Xxxxx
has not been advised by any Regulatory Authority that any such
Regulatory Authority is contemplating issuing or requesting the
issuance of any such order or memorandum in the future.
Section 3.11 Taxes and Tax Returns. Xxxxx has previously
delivered or made available to USB copies of the federal income tax
returns of Xxxxx for the years 1992, 1993 and 1994 and all
schedules and exhibits thereto, and will provide USB with a copy of
its federal income tax return for the year 1995 with all schedules
and exhibits thereto, when such return is filed, and such returns
have not been subjected to an audit by the Internal Revenue
Service. Except as reflected in Disclosure Schedule 3.11, Xxxxx
has duly filed in correct form all material federal, state and
local information returns and tax returns required to be filed by
either of them on or prior to the date hereof, and Xxxxx has duly
paid or made adequate provisions for the payment of all taxes and
other governmental charges which have been incurred or are due or
claimed to be due from either of them by any federal, state or
local taxing authorities (including, without limitation, those due
in respect of the properties, income, business, capital stock,
deposits, franchises, licenses, sales and payrolls of Xxxxx other
than taxes and other charges which (i)(A) are not yet delinquent or
(B) are being contested in good faith or (ii) have not been finally
determined. The amounts set forth as liabilities for taxes on the
Financial Statements of Xxxxx and the Call Reports of Xxxxx are
sufficient, in the aggregate, for the payment of all unpaid
federal, state and local taxes (including any interest or penalties
thereon), whether or not disputed, accrued or applicable, for the
periods then ended, and have been computed in accordance with
generally accepted accounting principles consistent with past
practices. Xxxxx is not responsible for the taxes of any other
person other than Xxxxx, under Treasury Regulation 1.1502-6 or any
similar provision of federal, state or foreign law.
Section 3.12 Employee Benefit Plans. (a) Xxxxx does not
maintain any "employee benefit plan," as defined in Section 3(3) of
the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), except as described in Disclosure Schedule 3.12(a).
(b) Xxxxx (or any pension plan maintained by it) has not
incurred any liability to the Pension Benefit Guaranty Corporation
("PBGC") or the Internal Revenue Service with respect to any
pension plan qualified under Section 401 of the Code, except
liabilities to the PBGC pursuant to Section 4007 of ERISA, all
which have been fully paid. No reportable event under Section
4043(b) of ERISA (including events waived by PBGC regulation) has
occurred with respect to any such pension plan.
(c) Xxxxx has not incurred any material liability under
Section 4201 of ERISA for a complete or partial withdrawal from, or
agreed to participate in, any multi-employer plan as such term is
defined in Section 3(37) of ERISA.
(d) Xxxxx has no "employee benefit plan", as defined in
Section 3(3) of ERISA, that provides medical or life insurance
benefits to any retired employee except as required by law.
(e) All "employee benefit plans," as defined in Section
3(3) of ERISA, that are maintained by Xxxxx comply in both form and
operation, in all material respects, with ERISA and the Code that
are applicable, or intended to be applicable, to such "employee
benefit plans." Xxxxx has no material liability under any such
plan that is not reflected in the Financial Statements of Xxxxx or
the Call Reports of Xxxxx.
(f) No prohibited transaction (which shall mean any
transaction prohibited by Section 406 of ERISA and not exempt under
Section 408 of ERISA) has occurred with respect to any employee
benefit plan maintained by Xxxxx (i) which would result in the
imposition, directly or indirectly, of a material excise tax under
Section 4975 of the Code or a material civil penalty under Section
502(i) of ERISA, or (ii) the correction of which would have a
material adverse effect on the Condition of Xxxxx; and no actions
have occurred which could result in the imposition of a penalty
under any section or provision of ERISA.
(g) No employee benefit plan which is a defined benefit
pension plan 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 any 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 in accordance with all
applicable legal requirements.
(h) Neither the execution and delivery of this Agreement
nor the consummation of the transactions contemplated hereby will
(i) result in any material payment (including, without limitation,
severance, unemployment compensation, golden parachute or
otherwise) becoming due to any director or any officer or employee
of Xxxxx under any benefit plan or otherwise, (ii) materially
increase any benefits otherwise payable under any benefit plan or
(iii) result in any acceleration of the time of payment or vesting
of any such benefits to any material extent.
Section 3.13 Title and Related Matters. (a) Except as set
forth in Disclosure Schedule 3.13(a) and except with respect to
"other real estate owned", Xxxxx has good title, and as to owned
real property, has good and marketable title in fee simple
absolute, to all assets and properties, real or personal, tangible
or intangible, reflected as owned by it or carried under its name
on the Financial Statements of Xxxxx, or the Call Reports of Xxxxx
or acquired subsequent thereto (except to the extent that such
assets and properties have been disposed of for fair value in the
ordinary course of business since June 30, 1995), free and clear of
all liens, encumbrances, mortgages, security interests,
restrictions, pledges or claims, except for (i) those liens,
encumbrances, mortgages, security interests, restrictions, pledges
or claims reflected in the Financial Statements of Xxxxx and the
Call Reports of Xxxxx or incurred in the ordinary course of
business after June 30, 1995, (ii) statutory liens for amounts not
yet delinquent or which are being contested in good faith, and
(iii) liens, encumbrances, mortgages, security interests, pledges,
claims and title imperfections that are not in the aggregate
material to the Condition of Xxxxx.
(b) All agreements pursuant to which Xxxxx leases,
subleases or licenses material real or material personal properties
from others are valid, binding and enforceable in accordance with
their respective terms, and there is not, under any of such leases
or licenses, any existing default or event of default, or any event
which with notice or lapse of time, or both, would constitute a
default or force majeure, or provide the basis for any other claim
of excusable delay or nonperformance, except for defaults which
individually or in the aggregate would not have a material adverse
effect on the Condition of Xxxxx.
(c) Other than "other real estate owned", (i) all of the
buildings, structures and fixtures owned, leased or subleased by
Xxxxx, are in good operating condition and repair, subject only to
ordinary wear and tear and/or minor defects which do not interfere
with the continued use thereof in the conduct of normal operations,
and (ii) all of the material personal properties owned, leased or
subleased by Xxxxx, are in good operating condition and repair,
subject only to ordinary wear and tear and/or minor defects which
do not interfere with the continued use thereof in the conduct of
normal operations.
Section 3.14 Real Estate. (a) Disclosure Schedule 3.14(a)
identifies and sets forth a complete legal description for each
parcel of real estate or interest therein owned, leased or
subleased by Xxxxx or in which Xxxxx has any ownership or leasehold
interest; provided that "other real estate owned" or otherwise held
in the loan portfolio of Xxxxx is only reasonably identified on
Disclosure Schedule 3.14(a).
(b) Disclosure Schedule 3.14(b) lists or otherwise
describes each and every written or oral lease or sublease under
which Xxxxx is the lessee of any real property and which relates in
any manner to the operation of the businesses of Xxxxx. All
rentals due under such leases have been paid and there exists no
material default under the terms of any lease and no event has
occurred which, upon the passage of time or giving of notice, or
both, would result in any event of default or prevent Xxxxx, from
exercising and obtaining the benefits of any options or other
rights contained therein, except for defaults which individually or
in the aggregate would not have a material adverse effect on the
Condition of Xxxxx. Except as set forth in Disclosure Schedule
3.14(b), Xxxxx has all right, title and interest as a lessee under
the terms of each lease or sublease, free and clear of all liens,
claims or encumbrances (other than the rights of the lessor), and
all such leases are valid and in full force and effect. Xxxxx has
the right under each such lease and sublease to occupy, use,
possess, and control all property leased or subleased by Xxxxx and,
as of the Effective Time of the Share Exchange, shall have the
right to transfer each lease or sublease pursuant to this
Agreement.
(c) Xxxxx has not violated, and is not currently in
violation of, any law, regulation or ordinance relating to the
ownership or use of the real estate and real estate interests
described in Disclosure Schedules 3.14(a) and 3.14(b) including,
but not limited to any law, regulation or ordinance relating to
zoning, building, occupancy, environmental or comparable matter
which individually or in the aggregate would have a material
adverse effect on the Condition of Xxxxx.
(d) As to each parcel of real property owned or used by
Xxxxx, Xxxxx has not received notice of any pending or threatened
condemnation proceedings, litigation proceedings or mechanics or
materialmen's liens.
Section 3.15 Environmental Matters.
(a) Xxxxx and the Participation Facilities (as defined
below) are, and have been, in compliance with all applicable laws,
rules, regulations, standards and requirements of the United States
Environmental Protection Agency and all state and local agencies
with jurisdiction over pollution or protection of the environment,
except for violations which, individually or in the aggregate, will
not have a material adverse effect on the Condition of Xxxxx.
(b) Xxxxx has not received notice of any litigation
pending or threatened before any court, governmental agency or
board or other forum in which Xxxxx or any Participation Facility
has been or, with respect to threatened litigation may be, named as
defendant (i) for alleged noncompliance (including by any
predecessor), with any Environmental Law (as defined below) or (ii)
relating to the release of an amount of a reportable quantity or
more into the environment of any Hazardous Material (as defined
below) or oil, whether or not occurring or on a site owned or
leased or operated by Xxxxx or any Participation Facility, except
for such litigation pending or threatened that will not,
individually or in the aggregate, have a material adverse effect on
the Condition of Xxxxx.
(c) There is no reasonable basis for any litigation of
a type described in Section 3.15(b) of this Agreement, except as
will not have, individually or in the aggregate, a material adverse
effect on the Condition of Xxxxx.
(d) During the period of (i) ownership or operation by
Xxxxx of any of its current properties, or (ii) participation by
Xxxxx in the management of any Participation Facility, there have
been no releases of Hazardous Material or oil in, on, under or
affecting such properties.
(e) "Environmental Law" means any applicable federal,
state or local law, statute, ordinance, rule, regulation, code,
license, permit, authorization, approval, consent, order, judgment,
decree or injunction relating to (i) the protection, preservation
or restoration of the environment (including, without limitation,
air, water vapor, surface water, groundwater, drinking water
supply, surface soil, subsurface soil, plant and animal life or any
other natural resource), and/or (ii) the use, storage, recycling,
treatment, generation, transportation, processing, handling,
labeling, production, release or disposal of any substance
presently listed, defined, designated or classified as hazardous,
toxic, radioactive or dangerous, or otherwise regulated, whether by
type or by substance as a component; and "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; and "Participation Facility" means any
facility in which Xxxxx has engaged in participation in the
management of such facility, and, where required by the context,
includes the owner or operator of such facility, but only with
respect to such facility or property.
Section 3.16 Commitments and Contracts. Xxxxx is not a
party or subject to any of the following (whether written or oral):
(a) Any employment contract (including any agreement or
plan with respect to severance or termination pay liabilities or
fringe benefits) with any present or former officer, director,
employee, including in any such person's capacity as a consultant
(other than those which either are terminable at will without any
further amount being payable thereunder or as a result of such
termination by Xxxxx);
(b) Any labor contract or agreement with any labor
union;
(c) Any contract covenants which limit the ability of
Xxxxx to compete in any line of business or which involve any
restriction of the geographical area in which Xxxxx may carry on
its business (other than as may be required by law or applicable
regulatory authorities);
(d) Any lease (other than real estate leases described
on Disclosure Schedule 3.14(b)) or other agreements or contracts
with annual payments aggregating $5,000 or more; or
(e) Any other contract or agreement which would be
required to be disclosed in reports filed by Xxxxx with the Alabama
Banking Department or the FDIC or other regulatory authority and
which has not been so disclosed.
Section 3.17 Regulatory Matters. Xxxxx has not agreed to
take any action or has agreed to any circumstance that would
materially impede or delay receipt of any Consents of any
Regulatory Authorities referred to in this Agreement including,
matters relating to the Community Reinvestment Act and protests
thereunder.
Section 3.18 Registration Obligations. Xxxxx is not under
any obligation, contingent or otherwise, which will survive the
Share Exchange to register any of its securities under the
Securities Act of 1933 or any state securities laws.
Section t ha Insurance. Xxxxx is presently insured, and
during each of the past three calendar years has been insured, for
reasonable amounts against such risks as companies or institutions
engaged in a similar business would, in accordance with good
business practice, customarily be insured. The policies of fire,
theft, liability and other insurance maintained with respect to the
assets or businesses of Xxxxx provide adequate coverage against
loss, and the fidelity bonds in effect as to which Xxxxx is named
an insured are sufficient for their purpose. Such policies of
insurance are listed and described in Disclosure Schedule 3.19.
Section 3.20 Labor. No work stoppage involving Xxxxx is
pending as of the date hereof or is threatened. Xxxxx is not
involved in, or threatened with or affected by, any proceeding
asserting that Xxxxx has committed an unfair labor practice or any
labor dispute, arbitration, lawsuit or administrative proceeding
which might reasonably be expected to have a material adverse
effect on the Condition of Xxxxx. No union represents or claims to
represent any employees of Xxxxx, and no labor union is attempting
to organize employees of Xxxxx.
Section 3.21 Compliance with Laws. Xxxxx has conducted its
business in accordance with all applicable federal, foreign, state
and local laws, regulations and orders, and is in compliance with
such laws, regulations and orders, except for such violations or
non-compliance, which when taken together as a whole, will not have
a material adverse effect on the Condition of Xxxxx. Except as
disclosed in Disclosure Schedule 3.21, Xxxxx:
(a) Is not in violation of any laws, orders or permits
applicable to its business or the employees or agents or
representatives conducting its business, except for violations
which individually or in the aggregate do not have and will not
have a material adverse effect on the Condition of Xxxxx; and
(b) Has not received a notification or communication
from any agency or department of federal, state or local government
or the Regulatory Authorities or the staff thereof (i) asserting
that Xxxxx is not in compliance with any laws or orders which such
governmental authority or Regulatory Authority enforces, where such
noncompliance is not reasonably likely to have a material adverse
effect on the Condition of Xxxxx, (ii) threatening to revoke any
permit, the revocation of which is not reasonably likely to have a
material adverse effect on the Condition of Xxxxx, (iii) requiring
Xxxxx to enter into any cease and desist order, formal agreement,
commitment or memorandum of understanding, or to adopt any
resolutions or similar undertakings, or (iv) directing, restricting
or limiting, or purporting to direct, restrict or limit in any
manner, the operations of Xxxxx, including, without limitation, any
restrictions on the payment of dividends.
Section 3.22 Transactions with Management. Except for (a)
deposits, all of which are on terms and conditions comparable to
those made available to other customers of Xxxxx at the time such
deposits were entered into, and (b) the items described on
Disclosure Schedule 3.22, there are no contracts with or
commitments to present or former stockholders, directors, officers
or employees involving the expenditure of more than $1,000 as to
any one individual, including, with respect to any business
directly or indirectly controlled by any such person, or $5,000 for
all such contracts for commitments in the aggregate for all such
individuals.
Section 3.23 Proxy Materials. None of the information
relating to Xxxxx to be included in the proxy statement which is to
be mailed to the shareholders of Xxxxx in connection with the
solicitation of their approval of this Agreement (the "Proxy
Statement") will, at the time such Proxy Statement is mailed or at
the time of the meeting of shareholders to which such Proxy
Statement relates, be false or misleading with respect to any
material fact, or omit to state any material fact, necessary in
order to make a statement therein not false or misleading.
Section 3.24 Deposit Insurance. The deposit accounts of
Xxxxx are insured by the Bank Insurance Fund in accordance with the
provisions of the Federal Deposit Insurance Act (the "Act"); Xxxxx
has paid all regular premiums and special assessments and filed all
reports required under the Act.
Section 3.25 Untrue Statements and Omissions. No
representation or warranty contained in Article III of this
Agreement or in the Disclosure Schedules of Xxxxx contains any
untrue statement of a material fact or omits to state a material
fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF
USB
USB hereby represents and warrants to Xxxxx as follows as of
the date hereof and also on the Effective Time of the Share
Exchange (except as otherwise provided):
Section 4.1 Organization and Related Matters of USB. (a)
USB is a corporation duly organized, validly existing and in good
standing under the laws of the State of Alabama. USB has the
corporate power and authority to own or lease all of its properties
and assets and to carry on its business as now conducted, or as
proposed to be conducted pursuant to this Agreement, and USB is
licensed or qualified to do business in each jurisdiction in which
the nature of the business conducted by USB, or the character or
location of the properties and assets owned or leased by USB makes
such licensing or qualification necessary, except where the failure
to be so licensed or qualified (or steps necessary to cure such
failure) would not have a material adverse effect on the Condition
of USB-Bank on a consolidated basis. USB is duly registered as a
bank holding company under the Bank Holding Company Act of 1956, as
amended. True and correct copies of the Articles of Incorporation
of USB and the Bylaws of USB, each as amended to the date hereof,
have been made available to Xxxxx prior to the Effective Time of
the Share Exchange.
(b) USB has in effect all federal, state, local and
foreign governmental, regulatory and other authorizations, permits
and licenses necessary for it to own or lease its properties and
assets and to carry on its business as now conducted, the absence
of which, either individually or in the aggregate, would have a
material adverse effect on the Condition of USB on a consolidated
basis.
(c) The minute books of USB contain complete and
accurate records in all material respects of all meetings and other
corporate actions held or taken by the shareholders and Board of
Directors of USB.
Section 4.2 Organization and Related Matters of USB-Bank.
(a) USB-Bank is a banking corporation duly organized, validly
existing and in good standing under the laws of Alabama. USB-Bank
has the corporate power and authority to own or lease all of its
properties and assets and to carry on its business as now
conducted, or as proposed to be conducted pursuant to this
Agreement, and USB-Bank is licensed or qualified to do business in
each jurisdiction in which the nature of the business conducted by
USB-Bank, or the character or location of the properties and assets
owned or leased by USB-Bank makes such licensing or qualification
necessary, except where the failure to be so licensed or qualified
(or steps necessary to cure such failure) would not have a material
adverse effect on the Condition of USB-Bank on a consolidated
basis. True and correct copies of the Articles of Incorporation
and Bylaws of USB-Bank, each as amended to the date hereof, have
been made available to Xxxxx.
(b) USB-Bank, as of the Effective Time of the Share
Exchange, will have in effect all federal, state, local and foreign
governmental, regulatory or other authorizations, permits and
licenses necessary for it to own or lease its properties and assets
and to carry on its business as proposed to be conducted, the
absence of which, either individually or in the aggregate, would
have a material adverse effect on the Condition of USB on a
consolidated basis.
(c) As of the Effective Time of the Share Exchange, the
minute books of USB-Bank will contain complete and accurate records
in all material respects of all meetings and other corporate
actions held or taken by the shareholders and Board of Directors of
USB-Bank.
Section 4.3 Capitalization. As of September 30, 1995, the
authorized capital stock of USB consisted of 2,400,000 shares of
common stock, par value $.01 per share, 2,202,060 shares (the "USB
Shares") of which are issued and outstanding and 64,100 shares of
which are held as treasury stock. All issued and outstanding USB
Shares have been duly authorized and validly issued, and all such
shares are fully paid and nonassessable.
Section 4.4 Authorization. The execution, delivery, and
performance of this Agreement, and the consummation of the
transactions contemplated hereby and in any related agreements,
have been or, as of the Effective Time of the Share Exchange, will
have been duly authorized by the board of directors of USB, and no
other corporate proceedings on the part of USB are or will be
necessary to authorize this Agreement and the transactions
contemplated hereby. This Agreement is the valid and binding
obligation of USB enforceable against it in accordance with its
terms, except as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the enforcement of creditors rights generally and except
that the availability of the equitable remedy of specific
performance or injunctive relief is subject to the discretion of
the court before which any proceeding may be brought. Neither the
execution, delivery or performance of this Agreement nor the
consummation of the transactions contemplated hereby will (i)
violate any provision of the Articles of Incorporation or Bylaws of
USB, or (ii) to USB's knowledge and assuming that any necessary
Consents are duly obtained, (A) violate, conflict with, result in
a breach of any provisions of, constitute a default (or an event
which, with notice or lapse of time, or both, would constitute a
default) under, result in the termination of, accelerate the
performance required by or result in the creation of any lien,
security interest, charge or other encumbrance upon any of the
properties or assets of USB under, any of the terms, conditions or
provisions of any note, bond, mortgage, indenture, deed of trust,
license, permit, lease, agreement or other instrument or obligation
to which USB is a party, or by which USB or any of its properties
or assets may be bound or affected, (B) violate any statute, code,
ordinance, rule, regulation, judgment, order, writ, decree or
injunction applicable to USB or any of their respective material
properties or assets, except for (X) such conflicts, breaches or
defaults as are set forth in Disclosure Schedule 4.4; and (Y) with
respect to (B) and (C) above, such as individually or in the
aggregate will not have a material adverse effect on the Condition
of USB on a consolidated basis.
Section 4.5 Consents and Approvals. Except for (i) the
Consents of the Regulatory Authorities; (ii) approval of this
Agreement by the shareholders of Xxxxx; (iii) filing of Articles of
Share Exchange with the Alabama Secretary of State; (iv) the filing
of this Agreement and certified resolutions with the Department;
and (v) as previously disclosed, no Consents or approvals by, or
filings or registrations with, any third party or any public body,
agency or authority are necessary in connection with the execution
and delivery by USB and the consummation of the Share Exchange and
the other transactions contemplated hereby.
Section 4.6 Regulatory Matters. USB has not agreed to take
any action, has no knowledge of any fact and has not agreed to any
circumstance that would materially impede or delay receipt of any
Consent from any Regulatory Authority referred to in the Agreement.
Section 4.7 Proxy Materials. None of the information
relating solely to USB or any of its subsidiaries to be included or
incorporated by reference in the Proxy Statement which is to be
mailed to the shareholders of Xxxxx in connection with the
solicitation of their approval of this Agreement will, at the time
such Proxy Statement is mailed or at the time of the meeting of
shareholders of Xxxxx to which such Proxy Statement relates, be
false or misleading with respect to any material fact, or omit to
state any material fact necessary in order to make a statement
therein not false or misleading.
Section 4.8 No Broker's or Finder's Fees. Neither USB nor
USB-Bank nor any of their subsidiaries, affiliates or employees has
employed any broker or finder or incurred any liability for any
broker's fees, commissions or finder's fees in connection with this
Agreement or the consummation of any of the transactions
contemplated herein.
ARTICLE V
COVENANTS AND AGREEMENTS
Section 5.1 Conduct of the Business of Xxxxx. (a) During
the period from the date of this Agreement to the Effective Time of
the Share Exchange, Xxxxx shall (i) conduct its business in the
usual, regular and ordinary course consistent with past practice
and prudent banking principles, (ii) use its best efforts to
maintain and preserve intact its business organization, employees,
goodwill with customers and advantageous business relationships and
retain the services of its officers and key employees, and (iii)
except as required by law or regulation, take no action which would
adversely affect or delay the ability of Xxxxx or USB to obtain any
Consent from any Regulatory Authorities or other approvals required
for the consummation of the transactions contemplated hereby or to
perform its covenants and agreements under this Agreement.
(b) During the period from the date of this Agreement to
the Effective Time of the Share Exchange, except as required by law
or regulation or contemplated by this Agreement, Xxxxx shall not,
without the prior written consent of USB:
(i) change, delete or add any provision of or to
the Articles of Incorporation or Bylaws of
Xxxxx;
(ii) change the number of shares of the authorized,
issued or outstanding capital stock of Xxxxx,
including any issuance, purchase, redemption,
split, combination or reclassification
thereof, or issue or grant any option,
warrant, call, commitment, subscription, right
or agreement to purchase relating to the
authorized or issued capital stock of Xxxxx,
or declare, set aside or pay any dividend or
other distribution with respect to the
outstanding capital stock of Xxxxx; provided,
however, that Xxxxx may pay a special dividend
or dividends to shareholders of Xxxxx in an
aggregate amount not to exceed $1,500,000
provided that Xxxxx has sufficient capital and
surplus to pay such dividend or dividends and
that the payment of such dividend or dividends
is not prohibited by any Regulatory Authority;
(iii)incur any material liabilities or material
obligations (other than deposit liabilities and
short-term borrowings in the ordinary course of
business), whether directly or by way of guaranty,
including any obligation for borrowed money, or
whether evidenced by any note, bond, debenture, or
similar instrument, except in the ordinary course of
business consistent with past practice;
(iv) except as set forth in Disclosure Schedule
5.1(b)(iv), make any capital expenditures
individually in excess of $5,000, or in the
aggregate in excess of $10,000 other than
pursuant to binding commitments existing on
September 30, 1995 and disclosed in a
Disclosure Schedule delivered pursuant to
Article III of this Agreement and other than
expenditures necessary to maintain existing
assets in good repair;
(v) sell, transfer, convey or otherwise dispose of
any real property (including "other real
estate owned") or interest therein having a
book value in excess of or in exchange for
consideration in excess of $5,000;
(vi) pay any bonuses to any executive officer
except pursuant to the terms of an enforceable
written employment agreement and except in a
manner consistent with past practice, which,
in any event, will not exceed an aggregate of
$30,000; enter into any new, or amend in any
respect any existing, employment, consulting,
non-competition or independent contractor
agreement with any person; alter the terms of
any existing incentive bonus or commission
plan; adopt any new or amend in any material
respect any existing employee benefit plan,
except as may be required by law; grant any
general increase in compensation to its
employees as a class or to its officers except
for non-executive officers in the ordinary
course of business and consistent with past
practices and policies or except in accordance
with the terms of an enforceable written
agreement; grant any material increases in
fees or other increases in compensation or in
other benefits to any of its directors; or
effect any change in any material respect in
retirement benefits to any class of employees
or officers, except as required by law;
(vii)except as set forth in Disclosure Schedule 5.1(b)(vii),
enter into or extend any agreement, lease or license
relating to real property, personal property, data
processing or bankcard functions relating to Xxxxx that
involves an aggregate expenditure in excess of $5,000; or
(viii)acquire twenty percent (20%) or more of the assets or
equity securities of any person or acquire direct or
indirect control of any person, other than in connection
with (A) foreclosures in the ordinary course of business,
or (B) acquisitions of control by Xxxxx in a fiduciary
capacity.
Section 5.2 Current Information. During the period from
the date of this Agreement to the Effective Time of the Share
Exchange or the time of termination or abandonment of this
Agreement, Xxxxx will cause one or more of its designated
representatives to confer on a regular and frequent basis with
representatives of USB and to report the general status of the
ongoing operations of Xxxxx. Xxxxx will promptly notify USB of any
material change in the normal course of business or the operations
or the properties of Xxxxx, any governmental complaints,
investigations or hearings (or communications indicating that the
same may be contemplated) affecting Xxxxx, the institution or the
threat of material litigation, claims, threats or causes of action
involving Xxxxx, and will keep USB fully informed of such events.
Xxxxx will furnish to USB, promptly after the preparation and/or
receipt by Xxxxx thereof, copies of its unaudited periodic
financial statements and call reports for the applicable periods
then ended, and such financial statements and call reports shall,
upon delivery to USB, be treated, for purposes of Section 3.3
hereof, as among the Financial Statements of Xxxxx and the Call
Reports of Xxxxx.
Section 5.3 Access to Properties; Personnel and Records.
(a) So long as this Agreement shall remain in effect, Xxxxx shall
permit USB or its agents full access, during normal business hours,
to the properties of Xxxxx, and shall disclose and make available
(together with the right to copy) to USB and to its internal
auditors, loan review officers, attorneys, accountants and other
representatives, all books, papers and records relating to the
assets, stock, properties, operations, obligations and liabilities
of Xxxxx, including all books of account (including the general
ledger), tax records, minute books of directors' and shareholders'
meetings, organizational documents, bylaws, contracts and
agreements, filings with any regulatory agency, examination
reports, correspondence with regulatory or taxing authorities,
documents relating to assets, titles, abstracts, appraisals,
consultant's reports, plans affecting employees, securities
transfer records and stockholder lists, and any other assets,
business activities or prospects in which USB may have a reasonable
interest, and Xxxxx shall use its reasonable best efforts to
provide USB and its representatives access to the work papers of
Brent's accountants. Xxxxx shall not be required to provide access
to or to disclose information where such access or disclosure would
violate or prejudice the rights of any customer, would contravene
any law, rule, regulation, order or judgment or would violate any
confidentiality agreement; provided that Xxxxx shall cooperate, to
the extent it does not incur undue cost, with USB in seeking to
obtain Consents from appropriate parties under whose rights or
authority access is otherwise restricted. The foregoing rights
granted to USB shall not, whether or not and regardless of the
extent to which the same are exercised, affect the representations
and warranties made in this Agreement by Xxxxx.
(b) All information furnished by the parties hereto
pursuant to this Agreement shall be treated as the sole property of
the party providing such information until the consummation of the
Share Exchange contemplated hereby and, if such transaction shall
not occur, the party receiving the information shall return to the
party which furnished such information, all documents or other
materials containing, reflecting or referring to such information,
shall use its best efforts to keep confidential all such
information, and shall not directly or indirectly use such
information for any competitive or other commercial purposes. The
obligation to keep such information confidential shall continue
following the date the proposed transactions are abandoned but
shall not apply to (i) any information which (A) the party
receiving the information was already in possession of prior to
disclosure thereof by the party furnishing the information, (B) was
then available to the public, or (C) became available to the public
through no fault of the party receiving the information; or (ii)
disclosures pursuant to a legal requirement or in accordance with
an order of a court of competent jurisdiction or regulatory agency;
provided that the party which is the subject of any such legal
requirement or order shall use its best efforts to give the other
party at least ten (10) business days prior notice thereof. Each
party hereto acknowledges and agrees that a breach of any of their
respective obligations under this Section 5.3 would cause the other
irreparable harm for which there is no adequate remedy at law, and
that, accordingly, each is entitled to injunctive and other
equitable relief for the enforcement thereof in addition to damages
or any other relief available at law.
Section 5.4 Approval of Xxxxx Shareholders. Xxxxx will
take all steps necessary under applicable laws to call, give notice
of, convene and hold a meeting of its shareholders at such time as
may be mutually agreed to by the parties for the purpose of
approving this Agreement and the transactions contemplated hereby
and for such other purposes consistent with the complete
performance of this Agreement as may be necessary or desirable.
The Board of Directors of Xxxxx will recommend to its shareholders
the approval of this Agreement and the transactions contemplated
hereby and Xxxxx will use its best efforts to obtain the necessary
approvals by its shareholders of this Agreement and the
transactions contemplated hereby.
Section 5.5 No Other Bids. Xxxxx, acting through any
director or officer or other agent shall not now, nor shall it
authorize or knowingly permit any officer, director or employee of,
or any investment banker, attorney, accountant or other
representative retained by Xxxxx, to solicit or encourage,
including by way of furnishing information, any inquiries or the
making of any proposal which may reasonably be expected to lead to
any takeover proposal with respect to Xxxxx. Xxxxx shall promptly
advise USB orally and in writing of any such inquiries or proposals
received by Xxxxx after the date hereof. As used in this Section
5.5, "takeover proposal" shall mean any proposal for a merger or
other business combination involving Xxxxx or for the acquisition
of a significant equity interest in Xxxxx or for the acquisition of
a significant portion of the assets of Xxxxx.
Section 5.6 Notice of Deadlines. Xxxxx shall notify USB in
writing of any deadline to exercise an extension or termination of
any material lease, agreement or license (including specifically
real property leases and data processing agreements) to which Xxxxx
is a party, at least ten (10) days prior to such deadline.
Section 5.7 Maintenance of Properties. Xxxxx will maintain
its properties and assets in satisfactory condition and repair for
the purposes for which they are intended, ordinary wear and tear
excepted.
Section 5.8 Compliance Matters. Prior to the Effective
Time of the Share Exchange, Xxxxx shall take, or cause to be taken,
all steps reasonably requested by USB to cure any deficiencies in
regulatory compliance by Xxxxx; provided that neither USB nor USB-
Bank shall be responsible for discovering any defects.
Section 5.9 Title Insurance. Xxxxx will, at its own
expense, with respect to the main office of Xxxxx, procure and
deliver to USB, at least thirty (30) days prior to the Effective
Time of the Share Exchange, owner's title insurance issued in such
amounts and by such insurance company reasonably acceptable to
Xxxxx, which policy shall be free of all material exceptions to
USB's reasonable satisfaction.
Section 5.10 Survey. Xxxxx, at its own expense, will
procure and deliver to USB at least thirty (30) days prior to the
Effective Time of the Share Exchange, a survey of the Xxxxx main
office real property, which survey shall be reasonably acceptable
to and shall be prepared by a licensed surveyor reasonably
acceptable to USB, disclosing the locations of all improvements,
easements, sidewalks, roadways, utility lines and other matters
customarily shown on such surveys and showing access affirmatively
to public streets and roads and providing the legal description of
the property in a form suitable for recording and insuring the
title thereof (the "Survey"). The Survey shall not disclose any
survey defect or encroachment from or onto such real property that
has not been cured or insured over prior to the Effective Time of
the Share Exchange.
Section 5.11 Subsidiary Merger Agreement. Prior to the
Effective Time of the Share Exchange, Xxxxx and USB-Bank shall have
executed and delivered the Subsidiary Merger Agreement
substantially in the form of Exhibit 5.11 hereto.
ARTICLE VI
ADDITIONAL COVENANTS AND AGREEMENTS
Section 6.1 Best Efforts; Cooperation. Subject to the
terms and conditions herein provided, each of the parties hereto
agrees to use its best efforts promptly 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, or otherwise, including attempting to obtain all
necessary Consents, to consummate and make effective, as soon as
practicable, the transactions contemplated by this Agreement.
Section 6.2 Regulatory Matters. (a) Following the
execution and delivery of this Agreement, USB and Xxxxx shall cause
to be prepared and filed all required applications and filings with
the Regulatory Authorities which are necessary or contemplated for
the obtaining of the Consents of the Regulatory Authorities or
consummation of the Share Exchange. Such applications and filings
shall be in such form as may be prescribed by the respective
government agencies and shall contain such information as they may
require. The parties hereto will cooperate with each other and use
their best efforts to prepare and execute all necessary
documentation, to effect all necessary or contemplated filings and
to obtain all necessary or contemplated permits, consents,
approvals, rulings and authorizations of government agencies and
third parties which are necessary or contemplated to consummate the
transactions contemplated by this Agreement, including, without
limitation, those required or contemplated from the Regulatory
Authorities, and the shareholders of Xxxxx. Each of the parties
shall have the right to review and approve in advance, which
approval shall not be unreasonably withheld, any filing made with,
or written material submitted to, any government agencies in
connection with the transactions contemplated by this Agreement.
(b) Each party hereto will furnish the other party with
all information concerning itself, its subsidiaries, directors,
trustees, officers, shareholders and depositors, as applicable, and
such other matters as may be necessary or advisable in connection
with any statement or application made by or on behalf of any such
party to any governmental body in connection with the transactions,
applications or filings contemplated by this Agreement. Upon
request, the parties hereto will promptly furnish each other with
copies of written communications received by them or their
respective subsidiaries from, or delivered by any of the foregoing
to, any governmental body in respect of the transactions
contemplated hereby.
Section 6.3 Other Matters. (a) The parties acknowledge
that nothing in this Agreement shall be construed as constituting
an employment agreement between USB or any of its affiliates and
any officer or employee of Xxxxx or obligation on the part of USB
or any of its affiliates to employ any such officers or employees.
(b) The parties agree that appropriate steps shall be
taken to terminate all employee benefit plans of Xxxxx, other than
the Xxxxx Banking Company Profit Sharing Plan and Trust (the "Xxxxx
Profit Sharing Plan"), as of the Effective Time of the Share
Exchange. Following the termination of such plans, USB agrees that
the officers and employees of Xxxxx who the Surviving Corporation
employs shall be eligible to participate in USB's employee benefit
plans, including welfare and fringe benefit plans on the same basis
as and subject to the same conditions as are applicable to any
newly-hired employee of USB; provided that:
(i) with respect to USB's group medical insurance
plan, USB shall credit each such employee for eligible
expenses incurred by such employee and his or her
dependents (if applicable) under Brent's group medical
insurance plan during the current calendar year for
purposes of satisfying the deductible provisions under
USB's plan for such current year, and USB shall waive all
waiting periods under said plans for pre-existing
conditions; and
(ii) credit for each such employee's past service
with Xxxxx prior to the Effective Time of the Share
Exchange ("Past Service Credit") shall be given by USB to
employees for purposes of:
(1) determining vacation and sick leave
benefits and accruals, in accordance with the
established policies of USB; provided that no such
officer or employee of Xxxxx shall be initially
credited with more than three (3) weeks of vacation
per year.
(2) establishing eligibility for
participation in and vesting under USB's employee
benefit plans (including welfare and fringe benefit
plans and United Security Bancshares, Inc. Employee
Stock Ownership Plan (with 401(k) provisions)) and
for purposes of determining the scheduling of
vacations and other determinations which are made
based on length of service.
(c) The Xxxxx Profit Sharing Plan shall be terminated as
of such date prior to the Effective Time of the Share Exchange as
USB shall specify, and, in connection with such termination, the
Profit Sharing Plan shall be amended to provide for the
distribution of each Participant's Accrued Benefit upon termination
in a single sum without the Participant's consent as promptly as
practicable following receipt of a favorable determination letter
from the Internal Revenue Service with respect to such termination.
Section 6.4 Indemnification. (a) Xxxxx agrees to
indemnify, defend and hold harmless USB and its subsidiaries, and
each of their respective present and former officers, directors,
employees and agents, from and against all losses, expenses,
claims, damages or liabilities to which any of them may become
subject under applicable laws (including, but not limited to, the
Securities Act of 1933 or the Securities Exchange Act of 1934), and
will reimburse each of them for any legal, accounting or other
expenses reasonably incurred in connection with investigating or
defending any such actions, whether or not resulting in liability,
insofar as such losses, expenses, claims, damages or liabilities
arise out of or are based upon any untrue statement of material
fact supplied by Xxxxx and contained in the Proxy Statement or any
application for the approval of the transactions contemplated by
this Agreement filed with any Regulatory Authority or arise out of
or are based upon the omission to state therein a material fact
necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
(b) Except as expressly provided in the Subsidiary
Agreement and Plan of Merger, USB and USB-Bank shall not and shall
have no obligation to indemnify, defend or hold harmless Xxxxx or
any of its present or former officers, directors, employees or
agents, against any losses, expenses, claims, damages or
liabilities of any nature whatsoever.
ARTICLE VII
MUTUAL CONDITIONS TO CLOSING
The obligations of USB, on the one hand, and Xxxxx, on the
other hand, to consummate the transactions provided for herein
shall be subject to the satisfaction of the following conditions,
unless waived as hereinafter provided for:
Section 7.1 Shareholder Approval. The Share Exchange shall
have been approved by the requisite vote of the shareholders of
Xxxxx.
Section 7.2 Regulatory Approvals. All necessary Consents
of the Regulatory Authorities shall have been obtained and all
notice and waiting periods required by law to pass after receipt of
such Consents shall have passed, and all conditions to consummation
of the Share Exchange set forth in such Consents shall have been
satisfied.
Section 7.3 Litigation. At the Effective Time of the Share
Exchange, no preliminary or permanent injunction or other order,
decree or ruling issued by a court, governmental, regulatory or
administrative agency or commission of competent jurisdiction nor
any statute, rule, regulation or executive order promulgated or
enacted by any government authority shall be in effect and shall
not be stayed, which would prevent or enjoin the consummation of
the Share Exchange or would impose or attach a material lien to the
consideration to be received by holders of the Xxxxx Shares
pursuant to this Agreement or would seek a material amount of
damages in connection with the Share Exchange contemplated by this
Agreement.
Section 7.4 Proxy Statement. If required by law, the Proxy
Statement of Xxxxx shall have been filed with the FDIC for review
and comment and shall have been cleared or authorized for mailing
by the staff of the FDIC.
ARTICLE VIII
CONDITIONS TO THE OBLIGATIONS OF USB
The obligations of USB to consummate the Share Exchange are
subject to the fulfillment of each of the following conditions,
unless waived as hereinafter provided for:
Section 8.1 Representations and Warranties. The
representations and warranties of Xxxxx set forth in this Agreement
and in any certificate or document delivered pursuant hereto shall
be true and correct as of the date of this Agreement and as of all
times up to and including the Effective Time of the Share Exchange
(as though made on and as of the Effective Time of the Share
Exchange except to the extent such representations and warranties
are by their express provisions made as of a specified date and
except for changes therein contemplated by this Agreement).
Section 8.2 Performance of Obligations. Xxxxx shall have
performed all covenants, obligations and agreements required to be
performed by it under this Agreement prior to the Effective Time of
the Share Exchange.
Section 8.3 Certificate Representing Satisfaction of
Conditions. Xxxxx shall have delivered to USB a certificate from
the President or Chief Executive Officer of Xxxxx dated as of the
Closing Date as to the satisfaction of the matters described in
Sections 8.1 and 8.2 hereof, and such certificate shall be deemed
to constitute additional representations, warranties, covenants,
and agreements of Xxxxx under Article III of this Agreement.
Section 8.4 Absence of Adverse Facts. Except for facts,
events or conditions disclosed to USB in this Agreement, any
Disclosure Schedule annexed to this Agreement or any letter
delivered to USB by Xxxxx and annexed to this Agreement or which
have occurred as a consequence of this Agreement or which are
consented to by USB, no fact, event or condition pertaining to
Xxxxx shall exist which has had or is likely to have a material
adverse affect upon the Condition of Xxxxx or would be materially
adverse to USB on a consolidated basis.
Section 8.5 Opinion of Counsel. USB shall have received an
opinion of counsel from Xxxxxxx, Smith, McIlwain, Xxxxxxxxxx &
Xxxxxxxx or other counsel to Xxxxx acceptable to USB in
substantially the form set forth in Exhibit 8.5 hereto.
Section 8.6 Consents Under Agreements. Xxxxx shall have
obtained the consent or approval of each person (other than the
Consents of the Regulatory Authorities) whose consent or approval
shall be required in order to permit the succession by the
Surviving Corporation to any obligation, right or interest of Xxxxx
under any loan or credit agreement, note, mortgage, indenture,
lease, license, or other agreement or instrument, except those for
which failure to obtain such consents and approvals would not in
the opinion of USB, individually or in the aggregate, have a
material adverse effect on the Surviving Corporation or upon the
consummation of the transactions contemplated by this Agreement.
Section 8.7 Material Condition. There shall not be any
action taken, or any statute, rule, regulation or order enacted,
entered, enforced or deemed applicable to the Share Exchange by any
Regulatory Authority which, in connection with the grant of any
Consent by any Regulatory Authority, imposes, in the judgment of
USB, any material adverse requirement upon USB or its subsidiaries,
including, without limitation, any requirement that USB sell or
dispose of any significant amount of the assets of Xxxxx or any
other banking or other subsidiary of USB, provided that, except for
any such requirement relating to the above-described sale or
disposition of any significant assets of Xxxxx or any banking or
other subsidiary of USB, no such term or condition imposed by any
Regulatory Authority in connection with the grant of any Consent by
any Regulatory Authority shall be deemed to be a material adverse
requirement unless it materially differs from terms and conditions
customarily imposed by any such entity in connection with the
acquisition of banks and bank holding companies under similar
circumstances.
Section 8.8 Outstanding Shares of Xxxxx. The total number
of Xxxxx Shares outstanding as of the Effective Time of the Share
Exchange and the total number of Xxxxx Shares covered by any
option, warrant, commitment, or other right or instrument to
purchase or acquire any Xxxxx Shares that are outstanding as of the
Effective Time of the Share Exchange, including any securities or
rights convertible into or exchangeable for Xxxxx Shares, shall not
exceed 4,000 shares in the aggregate.
Section 8.9 Noncompetition Agreements. Each of the
directors of Xxxxx as of the date of this Agreement shall have
entered into noncompetition agreements in favor of USB and USB-Bank
substantially in the form of Exhibit 8.10 hereto.
Section 8.10 Survey; Title Insurance. The Survey and title
insurance in the form and as described in Sections 5.9 and 5.10
shall have been prepared and delivered to USB and the contents
thereof acceptable to USB in its reasonable judgment.
Section 8.11 Dissenters. No holders of outstanding Xxxxx
Shares shall have elected to exercise their right to dissent from
the Share Exchange and demand payment in cash for the fair or
appraised value of their shares.
Section 8.12 Certification of Claims. Xxxxx shall have
delivered a certificate to USB that Xxxxx is not aware of any
pending or threatened claim under the directors and officers
insurance policy or the fidelity bond coverage of Xxxxx.
ARTICLE IX
CONDITIONS TO OBLIGATIONS OF XXXXX
The obligation of Xxxxx to consummate the Share Exchange as
contemplated herein is subject to each of the following conditions,
unless waived as hereinafter provided for:
Section 9.1 Representations and Warranties. The
representations and warranties of USB contained in this Agreement
or in any certificate or document delivered pursuant to the
provisions hereof will be true and correct as of the Effective Time
of the Share Exchange (as though made on and as of the Effective
Time of the Share Exchange).
Section 9.2 Performance of Obligations. USB shall have
performed all covenants, obligations and agreements required to be
performed by it under this Agreement prior to the Effective Time of
the Share Exchange.
Section 9.3 Certificate Representing Satisfaction of
Conditions. USB shall have delivered to Xxxxx a certificate dated
as of the Effective Time of the Share Exchange as to the
satisfaction of the matters described in Sections 9.1 and 9.2
hereof, and such certificate shall be deemed to constitute
additional representations, warranties, covenants, and agreements
of USB under Article IV of this Agreement.
Section 9.4 Consents Under Agreements. USB shall have
obtained the consent or approval of each person (other than the
Consents of Regulatory Authorities) whose consent or approval shall
be required in connection with the transactions contemplated hereby
under any loan or credit agreement, note, mortgage, indenture,
lease, license or other agreement or instrument, except those for
which failure to obtain such consents and approvals would not, in
the judgment of Xxxxx, individually or in the aggregate, have a
material adverse effect upon the consummation of the transactions
contemplated hereby.
ARTICLE X
TERMINATION, WAIVER AND AMENDMENT
Section 10.1 Termination. This Agreement may be terminated
and the Share Exchange abandoned at any time prior to the Effective
Time of the Share Exchange:
(a) by the mutual consent in writing of USB and Xxxxx;
(b) by USB or Xxxxx if the Share Exchange shall not have
occurred on or prior to May 31, 1996, provided that the failure to
consummate the Share Exchange on or before such date is not caused
by any breach of any of the representations, warranties, covenants
or other agreements contained herein by the party electing to
terminate pursuant to this Section 10.1(b);
(c) by USB or Xxxxx (provided that the terminating party
is not then in breach of any representation, warranty, covenant or
other agreement contained herein) in the event that any of the
conditions precedent to the obligations of the nonterminating party
to consummate the Share Exchange cannot be satisfied or fulfilled;
(d) by USB: If any fact, event or condition pertaining
to Xxxxx shall exist which has had or is likely to have a material
adverse affect upon the Condition of Xxxxx or would be materially
adverse to the Condition of USB on a consolidated basis, except for
facts, events or conditions disclosed to USB in this Agreement, any
Disclosure Schedule annexed to this Agreement or any letter
delivered to USB by Xxxxx and annexed to this Agreement or which
have occurred as a consequence of this Agreement or which are
consented to by USB; and
(e) by Xxxxx: If any fact, event or condition
pertaining to USB shall exist which has had or is likely to have a
material adverse affect upon the Condition of USB on a consolidated
basis, except for facts, events or conditions disclosed to Xxxxx in
this Agreement, any Disclosure Schedule annexed to this Agreement
or any letter delivered to Xxxxx by USB and annexed to this
Agreement or which have occurred as a consequence of this Agreement
or which are consented to by Xxxxx.
Section 10.2 Effect of Termination. In the event of the
termination and abandonment of this Agreement, it shall terminate
and become void, without liability on behalf of any party, and have
no effect, except as otherwise provided herein.
Section 10.3 Amendments. To the extent permitted by law,
this Agreement may be amended by a subsequent writing signed by
each of USB, USB-Bank and Xxxxx.
Section 10.4 Waivers. Subject to Section 11.10 hereof,
prior to or at the Effective Time of the Share Exchange, USB and
USB-Bank, on the one hand, and Xxxxx, on the other hand, shall have
the right to waive any default in the performance of any term of
this Agreement by the other, to waive or extend the time for the
compliance or fulfillment by the other of any and all of the
other's obligations under this Agreement and to waive any or all of
the conditions to its obligations under this Agreement, except any
condition, which, if not satisfied, would result in the violation
of any law or any applicable governmental regulation.
Section 10.5 Survival of Representations and Warranties. No
representations, warranties, covenants or agreements in this
Agreement or in any instrument delivered by USB or Xxxxx shall
survive the Closing Date, except for Sections 2.1, 2.2, 2.4, 5.3
and 6.3 hereof. No representation or warranty in this Agreement
shall be affected or deemed waived by reason of the fact that USB,
Xxxxx and/or its representatives knew or should have known that any
such representation or warranty was, is, might be or might have
been inaccurate in any respect.
ARTICLE XI
MISCELLANEOUS
Section 11.1 Entire Agreement. This Agreement and the
documents referred to herein contain the entire agreement between
USB and Xxxxx with respect to the transactions contemplated
hereunder and this Agreement supersedes all prior arrangements or
understandings with respect thereto, whether written or oral,
including that letter of intent between the parties dated November
6, 1995. Nothing in this Agreement, expressed or implied, is
intended to confer upon any person, firm, corporation or entity,
other than the parties hereto and their respective successors, any
rights, remedies, obligations or liabilities under or by reason of
this Agreement.
Section ree Notices. All notices or other communications
which are required or permitted hereunder shall be in writing and
sufficient if delivered personally or sent by first class or
registered or certified mail, postage prepaid, telegram or telex or
other facsimile transmission addressed as follows:
If to Xxxxx:
Xxxxx Banking Company
000 Xxxx Xxxxxx
X.X. Xxx X
Attention: Xxxxxx Xxxx
Fax: (000) 000-0000
with a copy to:
Xxxxxxx, Smith, McIlwain, Xxxxxxxxxx & Xxxxxxxx,
P.C.
000 Xxxxxxx Xxxxxxx Xxxx., Xxxxx
Xxxxxxxxxx, Xxxxxxx 00000-0000
Attention: W. Xxxxxx Xxxxxxxxxx, Esq.
If to USB-Bank or USB, then to:
United Security Bancshares, Inc.
000 Xxxx Xxxxx Xxxxxx
P.O. Box 249
Thomasville, Alabama 36784
Attention: Xxxx X. Xxxxxxxxxx, III
Fax: (000) 000-0000
with a copy to:
Bradley, Arant, Rose & White
0000 Xxxx Xxxxx
Xxxxx 0000
Xxxxxxxxxx, Xxxxxxx 00000
Attention: Xxxx X. Xxxx, Esq.
Fax: (000) 000-0000
All such notices or other communications shall be deemed
to have been delivered (i) upon receipt when delivery is made by
hand, (ii) on the third (3rd) business day after deposit in the
United States mail when delivery is made by first class, registered
or certified mail, and (iii) upon transmission when made by
telegram, telex or other facsimile transmission if evidenced by a
sender transmission completed confirmation.
Section 11.3 Severability. If any term, provision, covenant
or restriction contained in this Agreement is held by a court of
competent jurisdiction or other competent authority to be invalid,
void or unenforceable or against public or regulatory policy, the
remainder of the terms, provisions, covenants and restrictions
contained in this Agreement shall remain in full force and effect
and in no way shall be affected, impaired or invalidated, if, but
only if, pursuant to such remaining terms, provisions, covenants
and restrictions the Share Exchange may be consummated in
substantially the same manner as set forth in this Agreement as of
the later of the date this Agreement was executed or last amended.
Section 11.4 Costs and Expenses. Expenses incurred by Xxxxx
on the one hand and USB on the other hand, in connection with or
related to the authorization, preparation and execution of this
Agreement, the solicitation of shareholder approval and all other
matters related to the closing of the transactions contemplated
hereby, including all fees and expenses of agents, representatives,
counsel and accountants employed by either such party or its
affiliates, shall be borne solely and entirely by the party which
has incurred same.
Section 11.5 Captions. The captions as to contents of
particular articles, sections or paragraphs contained in this
Agreement and the table of contents hereto are inserted only for
convenience and are in no way to be construed as part of this
Agreement or as a limitation on the scope of the particular
articles, sections or paragraphs to which they refer.
Section 11.6 Counterparts. This Agreement may be executed
in any number of counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the
same document with the same force and effect as though all parties
had executed the same document.
Section 11.7 Governing Law. This Agreement is made and
shall be governed by and construed in accordance with the laws of
the State of Alabama without respect to its conflicts of laws
principles except to the extent certain federal regulations are
applicable.
Section 11.8 Persons Bound; No Assignment. This Agreement
shall be binding upon and shall inure to the benefit of the parties
hereto and their respective successors, distributees, and assigns,
but notwithstanding the foregoing, this Agreement may not be
assigned by any party hereto unless the prior written consent of
the other parties is first obtained.
Section 11.9 Exhibits and Schedules. Each of the exhibits
and schedules attached hereto is an integral part of this Agreement
and shall be applicable as if set forth in full at the point in the
Agreement where reference to it is made. Any matter disclosed in
any of the Schedules to the Agreement shall be deemed incorporated
by reference into each other Schedule thereto and disclosed in each
such Schedule.
Section 11.10 Waiver. The waiver by any party of the
performance of any agreement, covenant, condition or warranty
contained herein shall not invalidate this Agreement, nor shall it
be considered a waiver of any other agreement, covenant, condition
or warranty contained in this Agreement. A waiver by any party of
the time for performing any act shall not be deemed a waiver of the
time for performing any other act or an act required to be
performed at a later time. The exercise of any remedy provided by
law, equity or otherwise and the provisions in this Agreement for
any remedy shall not exclude any other remedy unless it is
expressly excluded. The waiver of any provision of this Agreement
must be signed by the party or parties against whom enforcement of
the waiver is sought. This Agreement and any exhibit, memorandum
or schedule hereto or delivered in connection herewith may be
amended only by a writing signed on behalf of each party hereto.
Section 11.11 Construction of Terms. Whenever used in this
Agreement, the singular number shall include the plural and the
plural the singular. Pronouns of one gender shall include all
genders. Accounting terms used and not otherwise defined in this
Agreement have the meanings determined by, and all calculations
with respect to accounting or financial matters unless otherwise
provided for herein, shall be computed in accordance with generally
accepted accounting principles, consistently applied. References
herein to articles, sections, paragraphs, subparagraphs or the like
shall refer to the corresponding articles, sections, paragraphs,
subparagraphs or the like of this Agreement. The words "hereof",
"herein", and terms of similar import shall refer to this entire
Agreement. Unless the context clearly requires otherwise, the use
of the terms "including", "included", "such as", or terms of
similar meaning, shall not be construed to imply the exclusion of
any other particular elements.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed and delivered, and their respective seals
hereunto affixed, by their officers thereunto duly authorized, and
have caused this Agreement to be dated as of the date and year
first above written.
[CORPORATE SEAL]
XXXXX BANKING COMPANY
By:
ATTEST It President
Its Secretary
[CORPORATE SEAL] UNITED SECURITY BANCSHARES, INC.
By:
Its President and
ATTEST: Chief Executive Officer
Its Secretary
AGREEMENT AND PLAN OF SHARE EXCHANGE OF
XXXXX BANKING COMPANY
AND
UNITED SECURITY BANCSHARES, INC.
LIST OF SCHEDULES
Disclosure Schedule 3.3(e)
Disclosure Schedule 3.4
Disclosure Schedule 3.5
Disclosure Schedule 3.7
Disclosure Schedule 3.10
Disclosure Schedule 3.11
Disclosure Schedule 3.12(a)
Disclosure Schedule 3.13(a)
Disclosure Schedule 3.14(a)
Disclosure Schedule 3.14(b)
Disclosure Schedule 3.19
Disclosure Schedule 3.21
Disclosure Schedule 3.22
Disclosure Schedule 4.4
Disclosure Schedule 5.1(b)(iv)
Disclosure Schedule 5.1(b)(vii)
AGREEMENT AND PLAN OF SHARE EXCHANGE OF
XXXXX BANKING COMPANY
AND
UNITED SECURITY BANCSHARES, INC.
LIST OF EXHIBITS
Exhibit 1.1(e)
Exhibit 1.1(i)
Exhibit 5.11
Exhibit 8.5
Exhibit 8.9
