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Exhibit 2.1
AMENDMENT TO AGREEMENT AND PLAN OF MERGER
This Amendment to Agreement and Plan of Merger (this "Amendment") dated
as of March 16, 2000 is entered into by and among Compass Bancshares, Inc.
("Compass"), Compass Merger, LLC ("CMLLC") and Osage 3734 LLC (the "Company").
WHEREAS, Compass and the Company entered into an Agreement and Plan of
Merger dated as of November 4, 1999 (the "Merger Agreement");
WHEREAS, the Merger Agreement requires that a new subsidiary of Compass
shall be merged with the Company with the new subsidiary being the surviving
entity;
WHEREAS, CMLLC is such new subsidiary;
WHEREAS, pursuant to Section 8.3 of the Merger Agreement, Compass and
the Company desire to amend the Merger Agreement for the purpose of making CMLLC
a party thereto; and
WHEREAS, the parties now desire to amend the Merger Agreement to
increase the number of shares to be received by the Company as Merger
Consideration to more nearly reflect the Fair Market Value of the Company based
on an appraisal obtained in accordance with the Merger Agreement;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein and in the Merger Agreement and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereby agree as follows:
1. Capitalized terms used herein and not defined herein shall have the
meanings set forth in the Merger Agreement.
2. Upon execution of this Amendment, CMLLC shall become a party to the
Merger Agreement, shall be deemed to be Merger Sub as defined in the Merger
Agreement, and shall succeed to the rights and become subject to the obligations
of Merger Sub as provided in the Merger Agreement.
3. Upon execution of this Amendment, Section 1.6(b) of the Merger
Agreement shall be amended to read in full as follows:
(b) Subject to adjustment pursuant to Section 6.8 hereof, each
holder of Company Membership Interests shall receive Merger
Consideration in shares of Compass common stock, par value $2.00 per
share ("Compass Common Stock") equal to the product of such holder's
aggregate Membership Interests, expressed as a percent, times 20,013.
In no event, however, shall Compass be obligated to issue any more than
20,013 shares of Compass Common Stock in exchange for all Membership
Interests Outstanding. The ratio of the number of shares of Compass
Common Stock to be
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exchanged for each Membership Interest, respectively, shall be adjusted
appropriately to reflect any stock dividends or splits with respect to
Compass Common Stock, where the record date or payment occurs prior to
the Effective Time.
4. Upon execution of this Amendment, the last sentence of Section
1.6(c) of the Merger Agreement shall be amended to read in full as follows:
Such cash payment shall be based on the average closing sales price of
the Compass Common Stock as reported by the NASDAQ National Market
System for the twenty days of trading preceding the fifth trading day
prior to the Effective Time.
5. The execution of this Amendment shall not relieve Compass of its
obligations under the Merger Agreement.
6. Except as herein provided, the terms of the Merger Agreement shall
remain in full force and effect.
7. This Amendment may be executed in several counterparts, and by the
parties on separate counterparts, and all such counterparts, when so executed
and delivered, shall constitute but one and the same agreement.
[Signature Page Follows]
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IN WITNESS WHEREOF the parties have executed this Amendment as of the
date first written above.
ATTEST: COMPASS BANCSHARES, INC.
By: /s/ Xxxxxx X. Xxxxxx By: /s/ Xxxxxxx X. Xxxxx
-------------------------- ---------------------------------------
Its: Assistant Secretary Its: Chief Financial Officer
ATTEST: COMPASS MERGER, LLC
By: Compass Bancshares, Inc., Manager
By: /s/ Xxxxxx X. Xxxxxx By: /s/ Xxxxxxx X. Xxxxx
-------------------------- ----------------------------------
Its: Assistant Secretary Its: Chief Financial Officer
ATTEST: OSAGE 3734 LLC
By:______________________ By: /s/ Xxxxxx X. Xxxxxxxx
---------------------------------------
Its: Its: Partner
MEMBERS
/s/ Xxxx X. Xxxxxxxx
-------------------------------------------
Xxxx X. Xxxxxxxx
RESPOND CORP.
By: /s/ Xxxxxx X. Xxxxxxxx
----------------------------------------
Xxxxxx X. Xxxxxxxx, President
KLA/4 FAMILY LIMITED PARTNERSHIP, LLP
By: /s/ Xxxxxxx X. Xxxxxxxxx
----------------------------------------
Xxxxxxx X. Xxxxxxxxx, Partner
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===============================================================================
AGREEMENT AND PLAN OF MERGER
BY AND BETWEEN
COMPASS BANCSHARES, INC.
AND
OSAGE 3734 LLC
Dated as of November 4, 1999
==============================================================================
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AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER ("Agreement") dated as of November 4,
1999, by and between Compass Bancshares, Inc., a Delaware corporation
("Compass"), Osage 3734 LLC, a Colorado limited liability company (the
"Company") and the other persons or entities listed on the signature pages to
this Agreement (collectively, the "Members").
WHEREAS, Compass desires to affiliate with the Company, and the Company
desires to affiliate with Compass in the manner provided in this Agreement;
WHEREAS, Compass and the Company believe that the Merger (as defined
herein) of the Company with a to-be-formed subsidiary ("Merger Sub") of Compass
organized under the laws of the State of Colorado to be added as a party to this
Agreement after the date hereof in the manner provided by, and subject to the
terms and conditions set forth in, this Agreement and all exhibits, schedules
and supplements hereto is desirable and in the best interests of their
respective institutions, shareholders and members; and
WHEREAS, the Members of the Company and the board of directors of
Compass have approved this Agreement and the proposed transactions substantially
on the terms and conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants hereinafter set forth, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties, intending
to be legally bound, hereby agree as follows:
ARTICLE I.
THE MERGER
SECTION 1.1 THE MERGER. Upon the terms and subject to the conditions
hereof, and in accordance with the Colorado Limited Liability Company Act
("CLLC"), the Company shall be merged with and into Merger Sub (the "Merger") as
soon as practicable following the satisfaction or waiver, if permissible, of the
conditions set forth in Article VII hereof. Following the Merger, Merger Sub
shall continue as the surviving company (the "Surviving Company") and the
separate existence of the Company shall cease. Compass shall not be deemed a
party to the Merger for the purposes of Section 7-80-1004 of the CLLC.
SECTION 1.2 EFFECTIVE TIME. The Merger shall be consummated by the
filing by the Colorado Secretary of State of Articles of Merger, in the form
required by and executed in accordance with the relevant provisions of the CLLC,
and by the issuance of a Certificate of Merger by the Secretary of State of
Colorado. (The date of such issuance and filing or such
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other time and date as may be specified in the Articles and Certificate of
Merger shall be the "Effective Time").
SECTION 1.3 CERTAIN EFFECTS OF THE MERGER. The Merger shall have the
effects set forth in Article 7-80-1004 of the CLLC.
SECTION 1.4 ARTICLES OF ORGANIZATION AND OPERATING AGREEMENT. The
Articles of Organization and Operating Agreement of the Merger Sub, in each case
as in effect at the Effective Time, shall be the Articles of Organization and
Operating Agreement of the Surviving Company.
SECTION 1.5 MANAGERS. The managers of Merger Sub at the Effective Time
shall be the managers of the Surviving Company and shall hold office from the
Effective Time until their respective successors are duly elected or appointed
and qualified in the manner provided in the Articles of Organization and
Operating Agreement of the Surviving Company, or as otherwise provided by law.
SECTION 1.6 CONVERSION OF SHARES.
(a) The membership interests ("Membership Interests") of the Company
issued and outstanding immediately prior to Effective Time ("Membership
Interests Outstanding"), shall, by virtue of the Merger and without any action
on the part of the holder thereof, be converted into and represent the right to
receive the consideration payable as set forth below (the "Merger
Consideration") to the holder of record thereof, without interest thereon. For
the purposes of determining the number of Membership Interests issued and
outstanding, the number of Membership Interests issued and outstanding shall be
increased by the number of Membership Interests that may be acquired upon
exercise or conversion of any warrant, option, convertible debenture or other
security entitling the holder thereof to acquire Membership Interests which is
in effect or outstanding immediately prior to the Effective Time. At the
Closing, the Company shall calculate and certify to Compass the Membership
Interests Outstanding.
(b) Subject to adjustment pursuant to Section 6.8 hereof, in
consideration for the Merger, Compass will issue to the Members an aggregate
number of shares of its common stock, par value $2.00 per share which is quoted
under the symbol "CBSS" on the NASDAQ National Market System ("Compass Common
Stock"), which is equal to the quotient of (x) (i) the Members' equity of the
Company as set forth on the Company's balance sheet dated as of the day
preceding the Closing (the "Closing Balance Sheet") less, (ii) the net book
value of the Property (as defined in Section 3.18(g)) and all improvements on
the Property (the "Improvements") as set forth on the Closing Balance Sheet,
plus, (iii) the Fair Market Value of the Property and Improvements (as
determined below) and (y) the average closing sales price of the Compass Common
Stock as reported by the NASDAQ National Market System for the twenty days of
trading preceding the fifth trading day prior to the Effective Time (the
"Average Closing Price"). Notwithstanding the foregoing, the number of shares of
Compass Common
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Stock to be issued to the Members pursuant to this Section 1.6 (b), plus any
Compass Common Stock to be issued pursuant to Section 1.6(b) of that certain
Agreement and Plan of Merger between Compass and 1996 Xxxxxx LLC and Section 1.6
(b) of that certain Agreement and Plan of Merger between Compass and Nagrom LLC,
both of even date herewith (the "Other Real Estate Agreements") shall not exceed
150,000 (the "Maximum Number of Shares"). In the event the number of shares of
Compass Common Stock to be issued pursuant to this Agreement and the Other Real
Estate Agreements exceeds the Maximum Number of Shares, then the number of
shares of Compass Common Stock to be issued pursuant to this Agreement and the
Other Real Estate Agreements shall be reduced on a pro rata basis among the
recipients thereof so that the total number of shares of Compass Common Stock to
be issued equals 150,000. The parties shall choose an appraiser to conduct an
appraisal to determine the Fair Market Value of the Property and Improvements as
follows: Xxxxxx X. Xxxxxxxx ("Xxxxxxxx") shall obtain an appraisal by an
appraiser reasonably satisfactory to Compass. In the event Compass or Xxxxxxxx
rejects the appraisal such party shall obtain a second appraisal of the
Property, and the Fair Market Value of the Property and Improvements will be
determined by taking the average of the two appraisals and such determination
shall be binding on the parties. The cost of any such appraisal or appraisals
shall be borne equally between the parties.
(c) Compass will not issue any certificates for any fractional shares
of Compass Common Stock otherwise issuable pursuant to the Merger. In lieu of
issuing such fractional shares, Compass shall pay cash to any holder of
Membership Interests otherwise entitled to receive such fractional share. Such
cash payment shall be based on the Average Closing Price.
SECTION 1.7 POOLING TRANSFER RESTRICTIONS AGREEMENT. Within 30 days
after the date hereof, the Company and the Members shall enter into with Compass
a written agreement substantially in the form of EXHIBIT A attached hereto.
SECTION 1.8 REGISTRATION OF THE COMPASS COMMON STOCK.
(a) Compass shall prepare a registration statement on Form S-4 (the
"Registration Statement") to be filed by Compass with the SEC under the
Securities Act of 1933, as amended ("Securities Act"), covering the shares of
Compass Common Stock to be issued to the Members in the Merger. The Members and
the Company agree to cooperate with Compass, its counsel and its accountants, in
the preparation of the Registration Statement; and provided that the Members and
the Company have cooperated as required above, Compass agrees to file the
Registration Statement with the SEC as promptly as reasonably practicable and
shall use reasonable efforts to cause such filing to occur within 50 days after
execution of this Agreement, subject to the receipt of all necessary information
on the part of the Members and the Company for inclusion in the Registration
Statement. Each of the Members, the Company and Compass agrees to use all
reasonable efforts to cause the Registration Statement to be declared effective
under the Securities Act as promptly as reasonably practicable after filing
thereof. Compass also agrees to use all reasonable efforts to obtain, prior to
or at the effective date of the Registration Statement, all necessary state
securities law or "Blue Sky" permits and approvals required to carry out the
Merger contemplated by this Agreement. The Members and the Company agree to
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furnish to Compass all information concerning the Company, its managers and
Members as may be requested in connection with the foregoing.
(b) Each of the Members, the Company and Compass agrees, as to itself
and its Subsidiaries, as applicable, that none of the information supplied or to
be supplied by it for inclusion or incorporation by reference in the
Registration Statement will, at the time the Registration Statement and each
amendment or supplement thereto, if any, becomes effective under the Securities
Act, contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the statement
therein not misleading.
(c) Compass agrees to advise the Company and the Members promptly after
Compass receives notice thereof, of the time when the Registration Statement has
become effective or any supplement or amendment has been filed, of the issuance
of any stop order or the suspension of the qualification of Compass Common Stock
for offering or sale in any jurisdiction, of the initiation or threat of any
proceeding for any such purpose or of any request by the SEC for the amendment
or supplement of the Registration Statement.
(d) Within 30 days after the date hereof, the Company and the Members
shall enter into with Compass a written agreement in substantially the form of
EXHIBIT A attached hereto.
(e) Notwithstanding the provisions of this Section 1.8, in the event
Compass is advised by the SEC that it is unable to utilize a Registration
Statement on Form S-4 to register the Compass Common Stock issuable pursuant to
this Agreement in addition to the shares of Compass Common Stock issuable
pursuant to the Ancillary Agreements, Compass agrees to prepare a registration
statement on Form S-3 (the "Resale Registration Statement") covering the resale
of Compass Common Stock to be issued to the Members in the Merger. Compass
agrees to file the Resale Registration Statement as soon as practicable after
the Closing and in no event later than 30 days after the Closing. Compass shall
keep the Resale Registration Statement effective for as long as the Members own
shares of Compass Common Stock or until the Members may sell the Compass Common
Stock pursuant to Rule 144 of the Securities Act or any successor rule,
whichever is earlier. Notwithstanding anything herein to the contrary, the
provisions of this Section 1.8(e) shall survive the Closing indefinitely.
SECTION 1.9 TAX CONSEQUENCES. It is anticipated by the parties hereto
that the Merger shall constitute a taxable exchange pursuant to Section 1001 of
the Code, subject to all of the normal provisions applicable to sales and
exchanges, including Section 706(c)(2) of the Code.
SECTION 1.10 CLOSING. Upon the terms and subject to the conditions
hereof, as soon as practicable after the satisfaction or waiver, if permissible,
of the conditions set forth in Article VII hereof, the Company and Merger Sub
shall execute and deliver the Articles of Merger as described in Section 1.2,
and the parties hereto shall take all such other and further actions as may be
required by law to make the Merger effective; provided, however, that the
Effective Time shall not occur prior to April 1, 2000, unless otherwise agreed.
Prior to the filing referred
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to in this Section, a closing (the "Closing") will be held at the office of
Xxxxx Xxxxxxx & Xxxx LLP in Houston, Texas (or such other place as the parties
may agree) for the purpose of confirming all of the foregoing.
SECTION 1.11 MODIFICATION OF STRUCTURE. Notwithstanding any provision
of this Agreement to the contrary, Compass may elect with the prior written
consent of the Company (such consent not to be unreasonably withheld), subject
to the filing of all necessary applications and the receipt of all required
regulatory approvals, to modify the structure of the transactions contemplated
hereby so long as (i) the consideration to be paid to the Members under this
Agreement is not thereby changed in kind or reduced in amount solely because of
such modification, (ii) such modification will not be likely to materially delay
or jeopardize receipt of any required regulatory approvals, and (iii) there are
no federal income tax consequences to the Members that are materially different
than those accorded by the structure set forth in this Agreement as a result of
the modifications.
ARTICLE II.
EXCHANGE OF SECURITIES
SECTION 2.1 EXCHANGE OF SECURITIES.
(a) At or prior to the Effective Time pursuant to an exchange agent
agreement in substantially the form attached hereto as EXHIBIT B (the "Exchange
Agreement"), Compass shall (i) deposit with Continental Stock Transfer and Trust
Company (the "Exchange Agent") the shares of Compass Common Stock in the amounts
provided in Section 1.6 to effect the exchange of Compass Common Stock for
Membership Interests of the Company; and (ii) deposit or cause to be deposited
with the Exchange Agent, prior to the Effective Time cash in an aggregate amount
estimated to be sufficient to make the cash payments in lieu of fractional
shares of Compass Common Stock pursuant to Section 1.6 hereof (such amounts
being hereinafter referred to as the "Exchange Fund"). The Exchange Agent shall,
pursuant to irrevocable instructions jointly given by the Members and Compass,
promptly make the payments in lieu of fractional shares out of the Exchange Fund
in accordance with Section 2.1(b). The Exchange Fund shall not be used for any
other purpose, except as provided in this Agreement.
(b) Promptly after the Effective Time, the Exchange Agent shall mail to
each Member of the Company, a form letter of transmittal, approved by the
Members and Compass, and instructions for use in effecting the payment for the
Membership Interests. Upon receipt of such letter of transmittal duly executed,
the Member shall be entitled to receive in exchange therefor cash and Compass
Common Stock in the amount provided in Section 1.6 hereof. No interest will be
paid or accrued on the cash payable and no dividend will be disbursed with
respect to the shares of Compass Common Stock until the holder's Membership
Interests are surrendered in exchange therefor.
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(c) After the Effective Time, the transfer ledger of the Company shall
be closed and there shall be no transfers on the transfer books of the Company
of the Membership Interests that were outstanding immediately prior to such time
of filing.
(d) Any portion of the Exchange Fund (including the proceeds of any
investments thereof) that remains unclaimed by the Members for six months after
the Effective Time shall be paid to Compass, and the holders of Membership
Interests not theretofore presented to the Exchange Agent shall look to Compass
only, and not the Exchange Agent, for the payment of any Merger Consideration in
respect of such Membership Interests.
ARTICLE III.
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
AND THE MEMBERS
The Company and the Members hereby jointly and severally make the
representations and warranties set forth in this Article III to Compass. The
Company has delivered to Compass the Schedules to this Agreement referred to in
this Article III prior to the date hereof. The Company and the Members agree at
the Closing to provide Compass and Merger Sub with supplemental Schedules
reflecting any changes thereto between the date of such Schedules and the date
of the Closing.
SECTION 3.1 ORGANIZATION AND QUALIFICATION. The Company is a Colorado
limited liability company, and is duly organized, validly existing and in good
standing under the laws of the State of Colorado. The Company has all requisite
power and authority to carry on its business as now being conducted and to own,
lease and operate its properties and assets as now owned, leased or operated.
The Company does not own or control any Affiliate (as defined in Section 3.15)
or Subsidiary. True and correct copies of the Articles of Organization,
Operating Agreement and other charter documents of the Company, with all
amendments thereto through the date of this Agreement, have been delivered to
Compass. The nature of the business of the Company and its activities, as
currently conducted, do not require it to be qualified to do business in any
jurisdiction other than the State of Colorado.
SECTION 3.2 COMPANY CAPITALIZATION. As of the date hereof, the Members
own all of the authorized Membership Interests of the Company. There are no
outstanding subscriptions, options, convertible securities, rights, warrants,
calls, or other agreements or commitments of any kind issued or granted by, or
binding upon, the Company to purchase or otherwise acquire any membership
interest or security of or equity interest in the Company. There are no
outstanding subscriptions, options, rights, warrants, calls, convertible
securities or other agreements or commitments obligating the Company to issue
any Membership Interests of the Company, or to the knowledge of the Members or
the Company, irrevocable proxies or any agreements restricting the transfer of
or otherwise relating to Membership Interests of the Company. All of the
Membership Interests that have been issued have been duly authorized, validly
issued and are fully paid and non-assessable, and are free of preemptive rights.
There are
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no restrictions applicable to the payment of distributions on the Membership
Interests except pursuant to the CLLC and applicable laws and regulations and
all distributions declared prior to the date hereof have been paid.
SECTION 3.3 SUBSIDIARIES; OTHER SECURITIES. The Company has no
Subsidiaries and does not have an equity ownership in any other person.
SECTION 3.4 AUTHORITY RELATIVE TO THE AGREEMENT. Each of the individual
Members and the Company have the absolute and unrestricted right and capacity
and full power and authority, and no further proceedings on the part of any of
the Members or the Company are necessary, to execute and deliver this Agreement
and to consummate the transactions contemplated hereby, which have been duly and
validly authorized by the Company's Managers and each of the Members. This
Agreement has been duly executed and delivered by each of the Members and the
Company and is a duly authorized, valid, legally binding and enforceable
obligation of each of the Members and the Company, subject to the effect of
bankruptcy, insolvency, reorganization, moratorium, or other similar laws
relating to creditors' rights generally and general equitable principles, and
subject to such approval of regulatory agencies and other governmental
authorities having authority over the Company as may be required by statute or
regulation. The execution, delivery and performance of this Agreement and the
consummation of the transactions contemplated hereby will not conflict with, or
result in any violation or breach of or default under the Articles of
Organization, or Operating Agreement of the Company.
SECTION 3.5 NO VIOLATION. Except as set forth on Schedule 3.5, neither
the execution, delivery nor performance of this Agreement in its entirety, nor
the consummation of all of the transactions contemplated hereby, following the
receipt of such approvals as may be required from the SEC, the Office of Thrift
Supervision ("OTS"), the Board of Governors of the Federal Reserve System
("FRB"), the Federal Deposit Insurance Corporation ("FDIC"), the Colorado State
Bank Commissioner ("Commissioner") and the Alabama Superintendent of Banks
("Superintendent") will (i) violate (with or without the giving of notice or the
passage of time), any law, order, writ, judgment, injunction, award, decree,
rule, statute, ordinance or regulation applicable to the Company or (ii) be in
conflict with, result in a breach or termination of any provision of, cause the
acceleration of the maturity of any debt or obligation pursuant to, constitute a
default (or give rise to any right of termination, cancellation or acceleration)
under, or result in the creation of any security interest, lien, charge or other
encumbrance upon any property or assets of the Company pursuant to, any terms,
conditions or provisions of any note, license, instrument, indenture, mortgage,
deed of trust or other agreement or understanding or any other restriction of
any kind or character, to which the Company is a party or by which any of its
assets or properties are subject or bound. There are no proceedings pending or,
to the knowledge of the Members or the Company, threatened, against the Company,
or involving the Membership Interests, at law or in equity or before or by any
foreign, federal, state, municipal or other governmental court, department,
commission, board, bureau, agency, instrumentality or other person which may
result in liability to Compass or Merger Sub upon the consummation of the
transactions contemplated hereby or which would prevent or delay such
consummation.
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Except as contemplated hereby, the existence, business organization, assets,
licenses, permits, authorizations and contracts of the Company will not be
terminated or impaired by reason of the execution, delivery or performance by
the Company and the Members of this Agreement or consummation by the Company and
the Members of the transactions contemplated hereby, assuming the receipt of
required shareholder and regulatory approvals.
SECTION 3.6 CONSENTS AND APPROVALS. Each of the Members has consented
to and approved the adoption of this Agreement, in accordance with the terms of
the Company's Operating Agreement and the CLLC. Except as described in Schedule
3.6 hereto, no prior consent, approval or authorization of, or declaration,
filing or registration with any person, domestic or foreign, is required in
connection with the execution, delivery and performance by the Members and the
Company of this Agreement and the transactions contemplated hereby, except the
filing of the Articles of Merger under the CLLC, and such approvals as may be
required from the SEC, the FRB, the OTS and the Superintendent.
SECTION 3.7 SECURITIES ISSUANCES. All issuances of securities by the
Company have been registered under the Securities Act, the Securities Act of the
State of Colorado, and all other applicable laws or were exempt from any such
registration requirements.
SECTION 3.8 FINANCIAL STATEMENTS. The Company has provided Compass with
a true and complete copy of the unaudited statement of financial position of the
Company as of December 31, 1998, and the related statement of income for the
year ended December 31, 1998, and the unaudited statement of financial position
of the Company as of September 30, 1999 and the related unaudited statement of
income, for the nine month period ended September 30, 1999, and promptly
following their availability the Company will provide Compass with the Company's
statement of financial position of the Company as of December 31, 1999 and the
related statement of income for the year ended December 31, 1999 (such
statements of financial position and the related statements of income, are
collectively referred to herein as the "Financial Statements"). The Financial
Statements fairly present the financial position of the Company as of the dates
thereof and the results of operations and changes in consolidated financial
position of the Company for the periods then ended, and the accounting records
underlying the Financial Statements accurately and fairly reflect in all
material respects the transactions of the Company. The Company has no
liabilities or obligations of a type which should be included in or reflected on
the Financial Statements, whether related to tax or non-tax matters, accrued or
contingent, due or not yet due, liquidated or unliquidated, or otherwise, except
as and to the extent disclosed or reflected in the Financial Statements. The
Company will provide Compass with the unaudited statements of financial position
of the Company as of the end of each month hereafter, prepared on a basis
consistent with prior periods. The Company has no off balance sheet liabilities
associated with financial derivative products or potential liabilities
associated with financial derivative products.
SECTION 3.9 ABSENCE OF CERTAIN CHANGES. Except as and to the extent set
forth on Schedule 3.9, since June 30, 1999 (the "Balance Sheet Date") the
Company has not:
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(a) made any amendment to its Articles of Organization or Operating
Agreement or changed the character of its business in any material manner;
(b) suffered any Material Adverse Effect (as defined in Section
10.12(b));
(c) entered into any agreement, commitment or transaction except in the
ordinary course of business;
(d) except in the ordinary course of business, incurred, assumed or
become subject to, whether directly or by way of any guarantee or otherwise, any
obligations or liabilities (absolute, accrued, contingent or otherwise);
(e) permitted or allowed any of its property or assets to be subject to
any mortgage, pledge, lien, security interest, encumbrance, restriction or
charge of any kind (other than statutory liens not yet delinquent) except in the
ordinary course of business;
(f) except in the ordinary course of business, canceled any debts,
waived any claims or rights, or sold, transferred, or otherwise disposed of any
of its properties or assets;
(g) directly or indirectly declared, set aside or made any distribution
in respect to its Membership Interests or redeemed, purchased or otherwise
acquired, or arranged for the redemption, purchase or acquisition of, any
Membership Interests or other of its securities;
(h) organized or acquired any capital stock or other equity securities
or acquired any equity or ownership interest in any person;
(i) issued, reserved for issuance, granted, sold or authorized the
issuance of any Membership Interests or subscriptions, options, warrants, calls,
rights or commitments of any kind relating to the issuance or sale of or
conversion into Membership Interests;
(j) made any or acquiesced with any change in any accounting methods,
principles or practices;
(k) except for the transactions contemplated by this Agreement or as
otherwise permitted hereunder, entered into any transaction, or entered into,
modified or amended any contract or commitment, other than in the ordinary
course of business; or
(l) agreed, whether in writing or otherwise, to take any action the
performance of which would change the representations contained in this Section
3.9 in the future so that any such representation would not be true in all
material respects as of the Closing.
SECTION 3.10 COMPANY INDEBTEDNESS. The Company has delivered to Compass
true and complete copies of all loan documents ("Company Loan Documents")
related to
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indebtedness of the Company ("Company Indebtedness") and made available to
Compass all material correspondence concerning the status of Company
Indebtedness.
SECTION 3.11 LITIGATION. There are no actions, suits, claims,
investigations, reviews or other proceedings pending or, to the knowledge of the
Members or the Company, threatened against the Company or involving any of its
properties or assets, at law or in equity or before or by any foreign, federal,
state, municipal, or other governmental court, department, commission, board,
bureau, agency, or other instrumentality or person or any board of arbitration
or similar entity ("Proceeding"). The Company will notify Compass immediately in
writing of any Proceedings against the Company.
SECTION 3.12 TAX MATTERS. The Company has duly filed all tax returns
that it was required to file (the "Filed Returns"). All such Filed Returns were
correct and complete in all material respects. The Company is not the
beneficiary of any extension of time within which to file any tax return. The
Company has no direct or indirect liability for the payment of any federal
income taxes, state and local income taxes, and franchise, property, sales,
employment or other taxes in excess of amounts paid or reserves established.
There are no liens for any taxes on any assets of the Company except for liens
for taxes not yet due or for taxes being contested in good faith and for which
adequate reserves have been established. There are no pending questions raised
in writing by the IRS or other taxing authority for taxes or assessments of or
in relation to the Company, nor are there any outstanding agreements or waivers
extending the statutory period of limitation applicable to any tax assessment or
deficiency against or in relation to the Company for any period. The Company has
withheld and paid over all taxes to the proper governmental authorities required
to be so withheld and paid over in connection with amounts paid or owing to any
employee, independent contractor, creditor, member or other third party. The
Company has never agreed to make, nor is the Company required to make, any
adjustment under Section 481(a) of the Code by reason of a change in the method
of accounting or otherwise.
SECTION 3.13 EMPLOYMENT MATTERS; EMPLOYEE BENEFIT PLANS. The Company
has no employees. The Company does not sponsor, maintain, contribute to or
participate in any employee benefit plans (as defined in Section 3(1) of the
Employee Retirement Income Safety Act of 1974, as amended ("ERISA")) or employee
pension benefit plans (as defined in Section 3(2) of ERISA).
SECTION 3.14 LEASES, CONTRACTS AND AGREEMENTS. Schedule 3.14 sets forth
an accurate and complete description of all leases, subleases, licenses,
contracts and agreements to which the Company is a party or by which the Company
is bound which obligate or may obligate the Company for an amount in excess of
$50,000 per lease, sublease, license, contract or agreement over the entire term
of any such agreement or any leases, subleases, licenses, contracts or
agreements with a current term of one year or longer (the "Contracts"). The
Company has made available to Compass true and correct copies of all Contracts.
All of the Contracts are legal, valid and binding obligations of the parties to
the Contracts enforceable in accordance with their terms, subject to the effect
of bankruptcy, insolvency, reorganization,
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moratorium, or other similar laws relating to creditors' rights generally and to
general equitable principles, and are in full force and effect. All payments by
the Company under the Contracts are current, there are no existing defaults by
the Company under the Contracts and no termination, condition or other event has
occurred which (whether with or without notice, lapse of time or the happening
or occurrence of any other event) would constitute a default.
SECTION 3.15 RELATED COMPANY TRANSACTIONS. Except as set forth on
Schedule 3.15, there are no agreements, instruments, commitments, extensions of
credit, tax sharing or allocation agreements or other contractual agreements of
any kind between or among the Company and any of its Affiliates. The term
"Affiliate" as used in this Agreement means, with respect to any person, any
person that, directly or indirectly, controls, is controlled by, or is under
common control with, such person in question. For the purposes of this
definition, "control" (including, with correlative meaning, the terms
"controlled by" and "under common control with") as used with respect to any
person, shall mean the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies of such person,
whether through the ownership of voting securities or by contract or otherwise.
SECTION 3.16 COMPLIANCE WITH LAWS. Except as set forth on Schedule
3.16, the Company is not in default in respect to or in violation of (i) any
judgment, order, writ, injunction or decree of any court, or (ii) in any
material respect, any statute, law, ordinance, rule, order or regulation of any
governmental department, commission, board, bureau, agency or instrumentality,
federal, state or local, and the consummation of the transactions contemplated
by this Agreement will not constitute such a default or violation as to the
Company. The Company has all permits, licenses, and franchises from governmental
agencies required to conduct their businesses as they are now being conducted.
SECTION 3.17 INSURANCE. The Company has in effect the insurance
coverage described in Schedule 3.17 and has had similar insurance in force since
its formation. The Company has made available to Compass true and accurate
copies of the policies and declaration pages evidencing such insurance coverage.
SECTION 3.18 COMPANY PROPERTY. The only real or personal property
(other than cash) that has ever been owned, leased or operated by the Company is
the Property (as defined herein).
SECTION 3.19 ENVIRONMENTAL COMPLIANCE. Except as set forth in Schedule
3.19, to the knowledge of the Company and the Members:
(a) The Company and the Property are in compliance with all applicable
Environmental Laws (as defined in Section 10.13(c)). There is no past or present
event, condition or circumstance that could (1) interfere with the conduct of
the business of the Company in the manner now conducted relating to such
entity's compliance with Environmental Laws, (2) constitute a violation of, or
serve as the basis of liability pursuant to, any Environmental Law or (3) which
could have a Material Adverse Effect upon the Company;
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(b) The Company and the Property have not been, and are not now subject
to any actual, or, to the knowledge of the Company, any potential or threatened
Proceeding pursuant to any Environmental Law and the Company has not received
any notice (whether from any regulatory body or private person) of any actual or
alleged violation of, or liability pursuant to, any Environmental Law;
(c) With respect to the Property, the Company was not required to
obtain any permit, license, or other authorization under RCRA, FWPCA, TSCA, CAA,
or any state or local counterparts to any of the foregoing.
(d) The Company has not generated any Hazardous Substances for which it
was required under an Environmental Law to execute any hazardous waste disposal
manifest;
(e) There are no underground or above ground storage tanks on or under
the Property nor any Hazardous Substances (except for asbestos containing
material ("ACM")) at, in, on, under or emanating from the Property in any
quantity or concentration exceeding any standard or limit established pursuant
to any Environmental Law;
(f) There is no ACM present in the Property, except non-friable ACM
which can be managed in place in compliance with Environmental Laws without air
monitoring, removal or encapsulation and which is managed under and in
compliance with an operations and maintenance program.
(g) For purposes of this Agreement, "Property" means the real property
described in EXHIBIT C.
SECTION 3.20 REGULATORY ACTIONS. Except as set forth on Schedule 3.20,
there are no actions or proceedings pending or, to the knowledge of the Members,
threatened against the Company by or before the Environmental Protection Agency,
the Colorado Department of Health and Environment or any other nation or
government, any state or political subdivision thereof, or any entity exercising
executive, legislative, judicial, regulatory or administrative functions of or
pertaining to government.
SECTION 3.21 TITLE TO PROPERTIES; ENCUMBRANCES. Except as set forth on
Schedule 3.21, in notes to the Financial Statements, or for such encumbrances
arising by operation of law, the Company has unencumbered, good, legal, and
indefeasible title to all its properties and assets, real and personal,
including, without limitation, all the properties and assets reflected in the
Financial Statements. The Company has a title policy in full force and effect
from a title insurance company that, to the best of Company's knowledge, is
solvent, insuring good and indefeasible title to the Property in favor of the
Company. The Company has made available to Compass all of the files and
information in the possession of the Company concerning such properties,
including any title exceptions which might affect indefeasible title or value of
such property. The Company holds good and legal title or good and valid
leasehold rights to all assets
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that are necessary for it to conduct its business as it is currently being
conducted. Except as set forth on Schedule 3.21, the Company owns all furniture,
equipment, art and other property used to transact business presently located on
its premises.
SECTION 3.22 TAKEOVER LAWS. This Agreement and the Merger contemplated
hereby are not subject to the requirements of any "moratorium," "control share,"
"fair price," "affiliate transactions," "business combination" or other
antitakeover laws and regulations of any state applicable to the Company.
SECTION 3.23 ACCOUNTING MATTERS. Neither the Company nor any of its
affiliates has taken or agreed to take any action that would prevent Compass
from accounting for the business combination to be effected by the Merger as a
pooling of interests, including, without limitation, any action inconsistent
with the provisions of EXHIBIT D hereto.
SECTION 3.24 YEAR 2000 REPRESENTATION. All software, firmware,
hardware, equipment, microprocessing chips and other data processing devices and
services (both as a recipient and as a provider), capabilities and facilities
utilized by, and material to the business operations or financial condition of,
the Company are or will be able to record and process all calendar dates
(whether before, in or after the year 2000) correctly with four-digit year
processing and will be able to communicate with other applicable systems to
accept two-digit year date data in a manner that resolves any ambiguities as to
century in a properly defined manner (collectively, "Year 2000 Compliant").
SECTION 3.25 MEMBERSHIP REPRESENTATIONS. Each Member represents as to
itself that it is (i) an "accredited investor" within the meaning of Rule 501
promulgated under the Securities Act and (ii) by reason of its business and
financial experience, it has such knowledge, sophistication and experience in
business and financial matters that it is capable of evaluating the merits and
risks of the prospective investment, it is able to bear the economic risk of
such investment and, at the present time, could afford a complete loss of such
investment.
SECTION 3.26 REPRESENTATIONS NOT MISLEADING. No representation or
warranty by the Members and the Company in this Agreement, or in any exhibit or
schedule furnished to Compass by the Company under and pursuant to this
Agreement, contains or will contain any untrue statement of a material fact or
omit to state a material fact necessary to make the statements contained herein
or therein, in light of the circumstances in which they were made, not
misleading.
ARTICLE IV.
REPRESENTATIONS AND WARRANTIES
OF COMPASS
Compass hereby makes the representations and warranties set forth in
this Article IV to the Members and the Company. Compass has delivered to the
Members and the Company the
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Schedules to this Agreement referred to in this Article IV prior to the date
hereof. Compass agrees at the Closing to provide the Members and the Company
with supplemental Schedules reflecting any changes thereto between the date of
such Schedules and the date of Closing.
SECTION 4.1 ORGANIZATION AND AUTHORITY.
(a) Compass is a corporation duly organized, validly existing, and in
good standing under the laws of the State of Delaware, and has all requisite
corporate power and authority to conduct its business as now conducted, to own,
lease and operate its properties and assets as now owned, leased or operated and
to enter into and carry out its obligations under this Agreement.
(b) Compass is a bank holding company under the Bank Holding Company
Act of 1956, as amended, and in good standing under all laws, rules and
regulations applicable to bank holding companies. Compass is duly qualified or
licensed and in good standing in each jurisdiction which requires such
qualification where it owns or leases properties or conducts business.
SECTION 4.2 AUTHORITY RELATIVE TO AGREEMENT. Compass has full corporate
power and authority and no further corporate proceedings on the part of Compass
are necessary to execute and deliver this Agreement and to consummate the
transactions contemplated hereby, all of which have been duly and validly
authorized by Compass' Board of Directors. This Agreement has been duly executed
and delivered by Compass and is a duly authorized, valid, legally binding and
enforceable obligation of Compass, subject to the effect of bankruptcy,
insolvency, reorganization, moratorium, or other similar laws relating to
creditors' rights generally and general equitable principles, and subject to
such shareholder approvals and such approval of regulatory agencies and other
governmental authorities having authority over Compass as may be required by
statute or regulation. Compass is not in violation of or default under its
Certificate of Incorporation or By-Laws or any agreement, document or instrument
under which Compass is obligated or bound, or any law, order, judgment,
injunction, award, decree, statute, rule, ordinance or regulation applicable to
Compass or any of its Subsidiaries, the violation or breach of which could have
a Material Adverse Effect on Compass and its Subsidiaries taken as a whole.
Except as set forth on Schedule 4.2, neither the execution, delivery nor
performance of this Agreement in its entirety, nor the consummation of all the
transactions contemplated hereby, following the receipt of such approvals as may
be required from the SEC, the OTS, the FRB, the FDIC and the Superintendent will
(i) conflict with or result in any violation or breach of or default under its
Certificate of Incorporation or By-Laws; (ii) violate (with or without the
giving of notice or passage of time), any law, order, writ, judgment,
injunction, award, decree, rule, statute, ordinance or regulation applicable to
Compass, or (iii) be in conflict with, result in a breach or termination of any
provision of, cause the acceleration of the maturity of any debt or obligation
pursuant to, constitute a default (or give rise to any right of termination,
cancellation or acceleration) under, or result in the creation of any security
interest, lien, charge or other encumbrance upon any property or assets of
Compass pursuant to, any terms, conditions or provisions of any note, license,
instrument, indenture, mortgage, deed of trust or other agreement or
understanding or any other restriction of any kind
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or character, to which Compass is a party or by which any of its assets or
properties are bound. Except as set forth on Schedule 4.2, there are no
proceedings pending or, to the knowledge of Compass, threatened, against
Compass, at law or in equity or before any foreign, federal, state, municipal or
other governmental court, department, commission, board, bureau, agency,
instrumentality or other person which may result in liability to the Company on
the consummation of the transactions contemplated hereby or which would prevent
or delay such consummation. Except as set forth in Schedule 4.2, or as
contemplated hereby, the corporate existence, business, organization, assets,
licenses, permits, authorizations and contracts of Compass will not be
terminated or impaired by reason of the execution, delivery or performance by
Compass of this Agreement or consummation by Compass of the transactions
contemplated hereby, assuming receipt of the required regulatory approvals.
SECTION 4.3 FINANCIAL REPORTS. Compass has previously furnished the
Members and the Company a true and complete copy of (i) the 1998 Annual Report
to Shareholders, which report (the "Compass 1998 Annual Report") includes, among
other things, consolidated balance sheets of Compass and its Subsidiaries as of
December 31, 1998 and 1997, the related consolidated statements of income,
shareholders' equity and cash flows for the years ended December 31, 1998, 1997
and 1996 and (ii) Compass' quarterly reports on Form 10-Q for the quarters ended
March 31 and June 30, 1999 (the "Quarterly Reports") which reports include among
other things unaudited balance sheets of Compass and its Subsidiaries as of
March 31 and June 30, 1999 and 1998, respectively, and the related unaudited
consolidated statements of income and cash flows for the three- and six-month
periods ending March 31 and June 30, 1999 and 1998. The financial statements
contained in the Compass 1998 Annual Report and such Quarterly Reports have been
prepared in conformity with GAAP applied on a basis consistent with prior
periods. The consolidated balance sheets of Compass and its Subsidiaries as of
December 31, 1998 and 1997 contained in the Compass 1998 Annual Report fairly
present the consolidated financial condition of Compass and its Subsidiaries as
of the dates thereof, and the related consolidated statements of income,
shareholders' equity and cash flows of Compass and its Subsidiaries contained
therein fairly present the results of operations and cash flows thereof for the
fiscal years then ended. The unaudited consolidated financial statements of
Compass and its Subsidiaries as of March 31 and June 30, 1999 and 1998,
contained in Compass' Quarterly Reports, fairly present the financial condition,
the results of the operations and changes in cash flows thereof as of such dates
and for the periods indicated. For the purposes of this Agreement, all financial
statements referred to in this Section 4.3 shall be deemed to include any notes
to such financial statements. Compass has made all filings required to be made
in compliance with the Exchange Act. None of the information contained in the
Compass 1998 Annual Report or Compass' Quarterly Reports is false or misleading
with respect to any material fact, or omits to state any material fact necessary
in order to make the statements therein, in light of the circumstances under
which they were made, not misleading.
SECTION 4.4 CAPITALIZATION. The shares of Compass Common Stock to be
issued pursuant to this Agreement, when so issued, will be duly and validly
authorized and issued, fully paid and nonassessable, and not issued in violation
of any preemptive rights. As of July 31, 1999, Compass had 113,629,765 shares of
common stock, $2.00 per share par value,
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issued and outstanding. None of the shares of Compass Common Stock to be issued
pursuant to this Agreement will be subject to any lien, charge, encumbrance,
claim, rights of others, mortgage, pledge or security interest, and none will be
subject to any agreements or understandings among any persons with respect to
the voting or transfer of such shares of Compass Common Stock except as
contemplated hereby.
SECTION 4.5 CONSENTS AND APPROVALS. No prior consent, approval or
authorization of, or declaration, filing or registration with any person,
domestic or foreign, is required of or by Compass in connection with the
execution, delivery and performance by Compass of this Agreement and the
transactions contemplated hereby or the resulting change in control of the
Company, except such approvals as may be required from the SEC, the FRB, the
OTS, the Commissioner, the Superintendent and the FDIC.
SECTION 4.6 AVAILABILITY OF THE COMPASS COMMON STOCK. Compass has
available a sufficient number of authorized and unissued shares of Compass
Common Stock to pay the Merger Consideration, and Compass will not take any
action during the term of this Agreement that will cause it not to have a
sufficient number of authorized and unissued shares of the Compass Common Stock
to pay the Merger Consideration.
SECTION 4.7 REGULATORY ACTIONS. Neither Compass nor any of its
Subsidiaries have taken or agreed to take any action or has knowledge of any
fact or circumstance that would materially impede or delay receipt of any
required regulatory approval.
SECTION 4.8 TAKEOVER LAWS. This Agreement and the Merger contemplated
hereby are not subject to the requirements of any "moratorium," "control share,"
"fair price," "affiliate transactions," "business combination" or other
antitakeover laws and regulations of any state applicable to Compass or any of
its Subsidiaries.
SECTION 4.9 ACCOUNTING MATTERS. Neither Compass nor any of its
affiliates has taken or agreed to take any action that would prevent Compass
from accounting for the business combination to be effected by the Merger as a
pooling of interests, including, without limitation, any action inconsistent
with the provisions of EXHIBIT D hereto.
SECTION 4.10 REPRESENTATIONS NOT MISLEADING. No representation or
warranty by Compass in this Agreement nor exhibit or schedule furnished to the
Members and the Company under and pursuant to this Agreement, contains or will
contain any untrue statement of a material fact or omit to state a material fact
necessary to make the statements contained herein or therein, in light of the
circumstances in which they were made, not misleading.
SECTION 4.11 LITIGATION. There are no material Proceedings pending, or
to the knowledge of Compass or its Subsidiaries, threatened against Compass or
its Subsidiaries or involving any of their respective properties or assets which
are required to be disclosed, but have not been so disclosed, in filings
required to be made with the SEC pursuant to the Exchange Act.
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SECTION 4.12 ABSENCE OF CHANGES. Since June 30, 1999, no event has
occurred or circumstances arisen that, individually, or taken together, with all
other facts, circumstances and events, would have required a filing with the SEC
pursuant to the Exchange Act which has not been so filed.
ARTICLE V.
COVENANTS OF THE MEMBERS AND THE COMPANY
SECTION 5.1 AFFIRMATIVE COVENANTS OF THE MEMBERS AND THE COMPANY. For
so long as this Agreement is in effect, the Members and the Company shall to,
from the date of this Agreement to the Closing, except as specifically
contemplated by this Agreement:
(a) preserve intact the Company's existence, business organization,
assets, licenses, permits, authorizations, and business opportunities;
(b) comply with all material contractual obligations applicable to the
Company's operations;
(c) maintain all the Company's properties in good repair, order and
condition, reasonable wear and tear excepted, and maintain the insurance
coverages described in Schedule 3.17 (which shall list the Property insured by
such coverages) or obtain comparable insurance coverages from reputable insurers
which, in respect to amounts, types and risks insured, are adequate for the
business conducted by the Company and consistent with the existing insurance
coverages;
(d) in good faith and in a timely manner (i) cooperate with Compass in
satisfying the conditions in this Agreement, (ii) assist Compass in obtaining as
promptly as possible all consents, approvals, authorizations and rulings,
whether regulatory, corporate or otherwise, as are necessary for Compass, the
Members and the Company (or any of them) to carry out and consummate the
transactions contemplated by this Agreement, including all consents, approvals
and authorizations required by any agreement or understanding existing at the
Closing between the Company and any governmental agency or other third party,
(iii) furnish information concerning the Company not previously provided to
Compass required for inclusion in any filings or applications that may be
necessary in that regard, (iv) assist Merger Sub in the assumption of the Loan
(as defined in Section 6.4) to the extent the Loan is determined to be assumable
by Merger Sub, and (v) perform all acts and execute and deliver all documents
necessary to cause the transactions contemplated by this Agreement to be
consummated at the earliest possible date;
(e) comply in all material respects with all applicable laws and
regulations, domestic and foreign;
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(f) promptly notify Compass upon obtaining knowledge of any default,
event of default or condition with which the passage of time or giving of notice
would constitute a default or an event of default under the Company Loan
Documents and promptly notify and provide copies to Compass of any material
written communications concerning the Company Loan Documents;
(g) between the date of this Agreement and Closing, promptly give
written notice to Compass upon obtaining knowledge of any event or fact that
would cause any of the representations or warranties of the Members and the
Company contained in or referred to in this Agreement to be untrue or misleading
in any material respect;
(h) deliver to Compass a list (Schedule 5.1(h)), dated as of the
Effective Time, showing (i) the name of each bank or institution where the
Company has accounts or safe deposit boxes, (ii) the name(s) in which such
accounts or boxes are held and (iii) the name of each person authorized to draw
thereon or have access thereto;
(i) deliver to Compass a list (Schedule 5.1(i)), dated as of the
Effective Time, showing all liabilities and obligations of the Company, except
those arising in the ordinary course of business, incurred since the Balance
Sheet Date, certified by a manager of the Company;
(j) promptly notify Compass of any material change or inaccuracies in
any data previously given or made available to Compass pursuant to this
Agreement; and
(k) provide access to the Property so as to enable Compass to
physically inspect any structure or components of any structure on the Property,
including without limitation surface and subsurface testing and analyses.
SECTION 5.2 NEGATIVE COVENANTS OF THE MEMBERS AND THE COMPANY. Except
with the prior written consent of Compass or as otherwise specifically permitted
by this Agreement, the Company and the Members will not, to, from the date of
this Agreement to the Closing:
(a) make any amendment to its Articles of Organization or Operating
Agreement;
(b) make any change in the methods used in allocating and charging
costs, except as may be required by applicable law and after notice to Compass;
(c) make any change in the number of Membership Interests issued and
outstanding, or issue, reserve for issuance, grant, sell or authorize the
issuance of any Membership Interests or subscriptions, options, warrants, calls,
rights or commitments of any kind relating to the issuance or sale of or
conversion into its Membership Interests;
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(d) contract to create any obligation or liability (absolute, accrued,
contingent or otherwise) except in the ordinary course of business;
(e) contract to create any mortgage, pledge, lien, security interest or
encumbrances, restrictions, or charge of any kind (other than statutory liens
for which the obligations secured thereby shall not become delinquent), except
in the ordinary course of business;
(f) cancel any debts, waive any claims or rights of value or sell,
transfer, or otherwise dispose of any of its material properties or assets,
except in the ordinary course of business;
(g) declare, pay or set aside for payment of distributions or any other
payment in respect of its Membership Interests, except for distributions or
payments consistent with past practices;
(h) except through settlement of indebtedness, foreclosure, the
exercise of creditors' remedies or in a fiduciary capacity, acquire the capital
stock or other equity securities or interest of any person;
(i) make any capital expenditure or a series of expenditures of a
similar nature in excess of $100,000 in the aggregate;
(j) make any income tax or franchise tax election or settle or
compromise any federal, state, local or foreign income tax or franchise tax
liability, or, except in the ordinary course of business, make any other tax
election or settle or compromise any other federal, state, local or foreign tax
liability;
(k) except for negotiations and discussions between the parties hereto
relating to the transactions contemplated by this Agreement or as otherwise
permitted hereunder, enter into any transaction, or enter into, modify or amend
any contract or commitment other than in the ordinary course of business;
(l) except as contemplated by this Agreement, adopt a plan of complete
or partial liquidation, dissolution, merger, consolidation, restructuring,
recapitalization, or other reorganization or business combination of the
Company;
(m) make any investments except in the ordinary course of business;
(n) modify, amend, waive or extend either the Company Loan Documents or
any rights under such agreements;
(o) sell or contract to sell the Property;
(p) change any fiscal year or the length thereof;
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(q) take or agree to take any action that would prevent Compass from
accounting for the business combination to be effected by the Merger as a
pooling of interests, including, without limitation, any action inconsistent
with the provisions of EXHIBIT D hereto; or
(r) prepay in whole or in part the Company Indebtedness; or
(s) enter into any agreement, understanding or commitment, written or
oral, with any other person which is in any manner inconsistent with the
obligations of the under this Agreement or any related written agreement.
Nothing contained in this Section 5.2 or in Section 5.1 is intended to influence
the general management or overall operations of the Company in a manner not
permitted by applicable law and the provisions thereof shall automatically be
reduced in compliance therewith.
ARTICLE VI.
ADDITIONAL AGREEMENTS
SECTION 6.1 ACCESS TO, AND INFORMATION CONCERNING, PROPERTIES AND
RECORDS. During the pendency of the transactions contemplated hereby, the
Members and the Company shall, to the extent permitted by law, give Compass, its
legal counsel, accountants and other representatives full access, during normal
business hours and upon reasonable advance notice, throughout the period prior
to the Closing, to all of the Company's properties, books, contracts,
commitments and records, permit Compass to make such inspections (including
without limitation physical inspection of the surface and subsurface of any
property thereof and any structure thereon) as they may require and furnish to
Compass during such period all such information concerning the Company and its
affairs as Compass may reasonably request. All information disclosed by the
Members or the Company to Compass which is confidential and is so identified to
Compass as confidential shall be held confidential by Compass and its
representatives, except to the extent counsel to Compass in its reasonable
opinion has advised it such information is required to or should be disclosed in
filings with regulatory agencies or governmental authorities or in proxy
materials delivered to shareholders of the Company. In the event this Agreement
is terminated pursuant to the provisions of Article VIII, upon the written
request of the Company, Compass agrees to destroy or return to the Company all
copies of such confidential information.
SECTION 6.2 FILING OF REGULATORY APPROVALS. Compass and the Company
shall use their best efforts to file all notices and applications to the FRB,
the OTS, the Superintendent, the Commissioner and the FDIC on or before December
1, 1999 which Compass deems necessary or appropriate to complete the
transactions contemplated herein. Compass will deliver to the Company, and the
Company will deliver to Compass, copies of all non-confidential portions of any
such applications.
SECTION 6.3 MISCELLANEOUS AGREEMENTS AND CONSENTS. Subject to the terms
and conditions of this Agreement, Compass, the Members and the Company agree to
use all
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reasonable efforts to take, or cause to be taken, all actions, and to do, or
cause to be done, all things necessary, proper, or advisable under applicable
laws and regulations to consummate and make effective, as soon as practicable
after the date hereof, the transactions contemplated by this Agreement. Compass,
the Members and the Company shall use their respective best efforts to obtain or
cause to be obtained consents of all third parties and governmental and
regulatory authorities necessary or desirable for the consummation of the
transactions contemplated herein.
SECTION 6.4 COMPANY INDEBTEDNESS. Prior to the Effective Time, the
Company shall pay all regularly scheduled payments on all Company Indebtedness
and shall cooperate with Compass in taking such actions as are reasonably
appropriate or necessary in connection with the redemption, prepayment,
modification, satisfaction or elimination of any outstanding indebtedness of the
Company with respect to which a consent is required to be obtained to effectuate
the Merger and the transactions contemplated by this Agreement and has not been
so obtained. Compass agrees to cause Merger Sub to assume, if possible, and, if
not, to cause Merger Sub to prepay or pay off the balance of that portion of the
Company Indebtedness evidenced by the loan to Berkshire Life Insurance Company
(the "Loan") listed on Schedule 3.21. Compass agrees that it shall be deemed not
possible to assume the Loan if Berkshire Life Insurance Company shall require
that any of the Members remain personally obligated, in whole or in part, for
repayment of the Loan as a condition of Merger Sub's assumption of the Loan. In
such situation, Merger Sub shall prepay or pay off the balance of the Loan. If
the Loan is assumed, prepaid or paid off, Merger Sub shall be responsible for
all fees and expenses thereof.
SECTION 6.5 BEST GOOD FAITH EFFORTS. All parties hereto agree that the
parties will use their best good faith efforts to secure all regulatory
approvals necessary to consummate the Merger and other transactions provided
herein and to satisfy the other conditions to Closing contained herein.
SECTION 6.6 EXCLUSIVITY. Neither the Members nor the Company shall
solicit, entertain or negotiate with respect to any offer to acquire the
Membership Interest or the Company from any other person. During the term of
this Agreement, neither the Members nor the Company shall provide information to
any other person in connection with a possible acquisition of the Company.
Immediately upon receipt of any such unsolicited offer, the Members or the
Company will communicate to Compass the terms of any proposal or request for
information and the identity of parties involved.
SECTION 6.7 PUBLIC ANNOUNCEMENT. Subject to written advice of counsel
with respect to legal requirements relating to public disclosure of matters
related to the subject matter of this Agreement, the timing and content of any
announcements, press releases or other public statements concerning the proposal
contained herein will occur upon, and be determined by, the mutual consent of
the parties hereto.
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SECTION 6.8 THE PROPERTY; RIGHT TO TERMINATE AGREEMENT.
(a) Compass and its consultants, agents and representatives, shall have
the right to the same extent that the Company has such right, but not the
obligation or responsibility, to inspect the Property, upon reasonable advance
notice, including, without limitation, for the purpose of conducting asbestos
surveys and sampling, and other environmental assessments and investigations
("Environmental Inspections"). Compass' right to conduct Environmental
Inspections shall include the right to sample and analyze air, sediment, soil
and groundwater of the Property to the same extent that the Company have such
right.
(b) Compass shall notify the Company of any Environmental Inspections
of the Property that it intends to conduct, and the Company may place reasonable
restrictions on the time of such inspections. Compass shall notify the Company
on or prior to January 15, 2000 if the Property, in the reasonable discretion of
Compass, is not acceptable and requires further assessment, remediation,
correction, or monitoring ("Environmental Response").
(c) Each party hereto agrees to indemnify and hold harmless the other
party for any claims for damage to the Property or injury or death to persons in
connection with any Environmental Inspection of the Property to the extent such
damage, injury or death is directly attributable to the negligent actions or
negligent omissions of such indemnifying party. Compass shall have no liability
or responsibility of any nature whatsoever for the results, conclusions or other
findings related to any Environmental Inspection. If this Agreement is
terminated, then except as otherwise required by law, Compass shall have no
obligation to make any reports to any governmental authority of the results of
any Environmental Inspection, but such reporting shall remain the responsibility
of and within the discretion of the Company. Compass shall have no liability to
the Company for making any report of such results to any governmental authority.
(d) Compass may, at its sole cost and expense, obtain an Owner's Title
Policy Commitment (the "Title Commitment") issued by a title insurance company
of Compass' choice. The Title Commitment shall set forth the state of title to
the Property together with all exception on conditions to such title, including,
but not limited to, all easements, restrictions, rights-of-way, covenants,
reservations, and all other encumbrances or other matters affecting the Property
which would appear in an Owner's Title Policy.
(e) Compass shall notify the Company on or prior to December 15, 1999
of any objections ("Title Objections") Compass may have to anything contained in
the Title Commitment and the Company shall take action to cure such objections
prior to the Effective Time. To the extent such objections are not cured, the
dollar value of such objections shall be a deduction from the aggregate Merger
Consideration.
(f) Compass may, at its sole cost and expense, obtain a survey (the
"Survey") of the Property showing the location of all improvements, fences,
evidence of abandoned fences, lakes, ponds, creeks, streams, rivers, easements,
roads and rights-of-ways and showing the location of the Property, if any, of
the 100-year flood plain.
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(g) Compass shall notify the Company on or prior to December 15, 1999
of any objections ("Survey Objections") Company may have to anything contained
on the Survey and the Company shall take action to cure such objections prior to
the Effective Time. To the extent such objections are not cured, the dollar
value of such objections shall be a deduction from the aggregate Merger
Consideration.
(h) Compass shall have the right to terminate this Agreement if the
Environmental Inspection identifies any past or present event, condition or
circumstance that, based on the reasonable estimates of the environmental
professionals referred to in this Section 6.7, may currently or in the future
require expenditures by the Company in connection with (1) Environmental
Response of the Property (including, without limitation, eventual removal of
asbestos containing material), (2) preparing and obtaining approval by the
appropriate Environmental Regulatory Authority of remediation plans with respect
to the Property, or (3) any violations of applicable Environmental Laws which
expenditures, individually or in the aggregate, may exceed $500,000 (the
"Aggregate Environmental Expense Limit); provided, however, that the
determination of the Aggregate Environmental Expense Limit shall include the
aggregate expenses in connection with Environmental Response (as defined in the
Ancillary Agreements as defined below) and preparing and obtaining approval by
the appropriate environmental regulatory authority of remediation plans with
respect to one or more of Controlled Property (as defined in one or more of the
Ancillary Agreements) under this Agreement and the Ancillary Agreements.
(i) The Company agrees to make available to Compass and its
consultants, agents and representatives all documents and other material
relating to environmental conditions of the Property including, without
limitation, the results of all other environmental inspections and surveys. The
Company also agrees that all engineers and consultants who prepared or furnished
such reports may discuss such reports and information with Compass and shall be
entitled to certify the same in favor of Compass and its consultants, agents and
representatives in such a manner which will entitle Compass to rely upon such
reports and make all other data available to Compass and its consultants, agents
and representatives. At the written request of the Company, Compass agrees to
provide the Company with a copy of all environmental reports prepared by its
consultants as a result of the Environmental Inspections.
SECTION 6.9 EXCHANGE AGREEMENT. Immediately prior to the Effective
Time, the Members, the Company and Compass agree to enter into the Exchange
Agreement with the Exchange Agent, or if the Exchange Agent refuses to serve as
exchange agent, such other exchange agent as shall mutually agreed to by the
Members, the Company and Compass.
SECTION 6.10 MANAGER INDEMNIFICATION.
(a) Following the Effective Time and for a period of five years
thereafter, Compass shall indemnify, defend, and hold harmless the present and
former managers of the Company (each, an "Indemnified Party") against all costs
or expenses, including reasonable attorneys'
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fees, judgments, fines, losses, claims, damages or liabilities incurred in
connection with any claim, action, suit, proceeding or investigation, whether
civil, criminal, administrative, or investigative, arising out of actions or
omissions accruing at or prior to the Effective Time) including, without
limitation, the transactions contemplated by this Agreement) to the fullest
extent that the Company is permitted to indemnify (and advance expenses to) its
managers under the Articles of Organization or Operating Agreement and any
indemnification agreements between the Company and its managers as in effect on
the date hereof; provided that any determination required to be made with
respect to whether a manager's conduct complies with the standard set forth
under the Company's Articles of Organization or Operating Agreement, and any
indemnification agreements between the Company and its managers shall be made by
independent counsel (which shall not be counsel that provides material services
to Compass, the Company or the person seeking indemnification hereunder)
selected by Compass and reasonably acceptable to such manager, officer, director
or employee. The indemnification provisions currently contained in the Articles
of Organization or Operating Agreement shall not be amended after the date
hereof.
(b) Any Indemnified Party wishing to claim indemnification under
Section 6.9(a) upon learning of any action, claim, suit, proceeding or
investigation described above shall promptly notice Compass thereof; provided,
that the failure to so notify shall not affect the obligations of Compass under
Section 6.9(a) unless and to the extent that Compass is actually prejudiced as a
result of such failure.
(c) If Compass or any of its successors or assigns shall consolidate
with or merge into any other entity and shall not be the continuing or surviving
entity of such consolidation or merger or shall transfer all or substantially
all of its assets to any entity, then and in each case, proper provisions shall
be made so that the successors and assigns of Compass shall assume the
obligations set forth in this Section 6.9.
ARTICLE VII.
CONDITIONS TO CONSUMMATION OF THE MERGER
SECTION 7.1 CONDITIONS TO EACH PARTY'S OBLIGATION TO EFFECT THE MERGER.
The respective obligations of each party to effect the Merger are subject to the
satisfaction or waiver of the following conditions prior to the Effective Time:
(a) the receipt of regulatory approvals which approvals shall not have
imposed any condition or requirement which in the judgment of Compass would
adversely impact the economic or business benefits of the transactions
contemplated by this Agreement or otherwise would in the judgment of Compass be
so burdensome as to render inadvisable the consummation of the Merger, and the
expiration of any applicable waiting period with respect thereto;
(b) the Closing will not violate any injunction, order or decree of any
court or governmental body having competent jurisdiction;
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(c) unless the provisions of Section 1.8(e) apply, a registration
statement covering the Compass Common Stock to be issued in the Merger shall be
effective under the Securities Act and any applicable state securities or "blue
sky" acts and no stop order suspending the effectiveness of such registration
statement shall be in effect and no proceedings for such purpose, or any
proceedings under the SEC or applicable state securities authorities rules with
respect to the transactions contemplated hereby, shall be pending before or
threatened by the SEC or any applicable state securities or blue sky
authorities; and
(d) the shares of Compass Common Stock to be issued in the Merger shall
have been approved for listing on the NASDAQ, subject to official notice of
issuance.
SECTION 7.2 CONDITIONS TO THE OBLIGATIONS OF COMPASS TO EFFECT THE
MERGER. The obligations of Compass to effect the Merger are subject to the
satisfaction or waiver of the following conditions prior to the Effective Time:
(a) all representations and warranties of the Members and the Company
shall be true and correct in all material respects as of the date hereof and at
and as of the Closing, with the same force and effect as though made on and as
of the Closing;
(b) the Members and the Company shall have performed in all material
respects all obligations and agreements and in all material respects complied
with all covenants and conditions, contained in this Agreement to be performed
or complied with by it prior to the Effective Time;
(c) there shall not have occurred a Material Adverse Effect with
respect to the Company;
(d) the managers of the Company shall have delivered to Compass an
instrument in the form of EXHIBIT G attached hereto dated the Effective Time
releasing the Company from any and all claims of such managers (except as to
their deposits and accounts, and as to their rights of indemnification pursuant
to the Articles of Organization or Operating Agreement of the Company) and the
managers shall have delivered to Compass their resignations as managers of the
Company;
(e) Compass shall have received the opinions of counsel to the Members
and the Company acceptable to it as to the matters set forth on EXHIBIT E
attached hereto;
(f) the aggregate principal amount of all Company Indebtedness shall
not exceed $210,000;
(g) Compass shall have determined, in its sole reasonable judgment,
that the liabilities and obligations set forth on Schedule 5.1(i) do not have a
Material Adverse Effect;
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(h) the transactions contemplated by each of (i) that certain Agreement
and Plan of Merger between Compass and MegaBank Financial Corporation of even
date herewith, (ii) that certain Agreement and Plan of Merger between Compass
and 1996 Xxxxxx, LLC of even date herewith, and (iii) that certain Agreement and
Plan of Merger between Compass and Nagrom LLC of even date herewith
(collectively, the "Ancillary Agreements"), shall have been simultaneously
consummated herewith;
(i) all equipment material to the operation of the Property shall have
been Year 2000 Compliant; and
(j) Compass shall have received certificates dated the Closing executed
by the an authorized manager of the Company certifying in such reasonable detail
as Compass may reasonably request, to the effect described in Sections 7.2(a),
(b) and (c).
SECTION 7.3 CONDITIONS TO THE OBLIGATIONS OF THE MEMBERS AND THE
COMPANY TO EFFECT THE MERGER. The obligations of the Members and the Company to
effect the Merger are subject to the satisfaction or waiver of the following
conditions prior to the Effective Time:
(a) all representations and warranties of Compass shall be true and
correct in all material respects as of the date hereof and at and as of the
Closing, with the same force and effect as though made on and as of the Closing;
(b) Compass shall have performed in all material respects all
obligations and agreements and in all material respects complied with all
covenants and conditions contained in this Agreement to be performed or complied
with by either of them prior to the Effective Time;
(c) the Members and the Company shall have received the opinion of
counsel to Compass acceptable to them, as to the matters set forth on EXHIBIT F
attached hereto;
(d) the Company shall have delivered to the managers of the Company an
instrument in the form of EXHIBIT H attached hereto dated the Effective Time
releasing such managers from any and all claims of the Company (except as to
indebtedness or other contractual liabilities); provided, however, that such
releases shall not release an action against such managers by Compass in
connection with the transactions contemplated by this Agreement;
(e) the Members and the Company shall have received certificates dated
the Closing, executed by an appropriate officers of Compass, certifying, in such
detail as the Company may reasonably request, to the effect described in
Sections 7.3(a) and (b); and
(f) there shall not have occurred a Material Adverse Effect with
respect to Compass.
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ARTICLE VIII.
TERMINATION; AMENDMENT; WAIVER
SECTION 8.1 TERMINATION. This Agreement may be terminated and the
Merger contemplated hereby may be abandoned at any time, but prior to the
Effective Time:
(a) by mutual written consent duly authorized by the Boards of
Directors of Compass and the Members of the Company;
(b) by Compass (i) if Compass learns or becomes aware of a state of
facts or breach or inaccuracy of any representation or warranty of the Members
and the Company contained in Article III which constitutes a Material Adverse
Effect, (ii) pursuant to Section 6.8 or (iii) if any of the conditions to
Closing contained in Section 7.1 or 7.2 are not satisfied or waived in writing
by Compass;
(c) by the Members or the Company if (i) the Members or the Company
become aware of a state of facts or breach or inaccuracy of any representation
or warranty of Compass contained in Article IV which constitutes a Material
Adverse Effect, or (ii) if any of the conditions to Closing contained in Section
7.1 or 7.3 are not satisfied or waived in writing by the Members or the Company;
(d) by Compass, the Members or the Company if the Effective Time shall
not have occurred on or before the expiration of eight months from the date of
this Agreement or such later date agreed to in writing by Compass, the Members
and the Company;
(e) by Compass, the Members or the Company if any court of competent
jurisdiction in the United States or other United States (federal or state)
governmental body shall have issued an order, decree or ruling or taken any
other action restraining, enjoining or otherwise prohibiting the Merger and such
order, decree, ruling or other action shall have been final and nonappealable;
or
(f) by Compass or the Company if one or more of the Ancillary
Agreements is terminated by any of the parties thereto.
SECTION 8.2 EFFECT OF TERMINATION. In the event of the termination and
abandonment of this Agreement pursuant to Section 8.1 hereof, this Agreement
shall forthwith become void and have no effect, without any liability on the
part of any party or its members, directors, officers or shareholders, other
than the provisions of Sections 6.3, 8.2, 9.1, 10.1 and 10.8. Nothing contained
in this Section 8.2 shall relieve any party from liability for any breach of
this Agreement.
SECTION 8.3 AMENDMENT. To the extent permitted by applicable law, this
Agreement may be amended by action taken by or on behalf of the managers of the
Company or
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the board of directors of Compass, at any time. This Agreement may not be
amended except by an instrument in writing signed on behalf of all the parties.
SECTION 8.4 EXTENSION; WAIVER. At any time prior to the Effective Time,
the parties may (i) extend the time for the performance of any of the
obligations or other acts of the other parties hereto, (ii) waive any
inaccuracies in the representations and warranties contained herein or in any
document, certificate or writing delivered pursuant hereto, or (iii) waive
compliance with any of the agreements or conditions contained herein. Any
agreement on the part of any party to any such extension or waiver shall be
valid only if set forth in an instrument in writing signed on behalf of such
party.
ARTICLE IX.
SURVIVAL
SECTION 9.1 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. The parties
hereto agree that all of their respective representations and warranties
contained in this Agreement shall not survive after the Effective Time.
ARTICLE X.
MISCELLANEOUS
SECTION 10.1 EXPENSES. All costs and expenses incurred in connection
with the transactions contemplated by this Agreement, including without
limitation, attorneys' fees, accountants' fees, other professional fees and
costs related to expenses of managers of the Company, shall be paid by the party
incurring such costs and expenses. Each party hereto hereby agrees to and shall
indemnify the other parties hereto against any liability arising from any such
fee or payment incurred by such party.
SECTION 10.2 BROKERS AND FINDERS. All negotiations on behalf of
Compass, the Members and the Company relating to this Agreement and the
transactions contemplated by this Agreement have been carried on by the parties
hereto and their respective agents directly without the intervention of any
other person in such manner as to give rise to any claim against Compass, the
Members or the Company for financial advisory fees, brokerage or commission
fees, finder's fees or other like payment in connection with the consummation of
the transactions contemplated hereby.
SECTION 10.3 ENTIRE AGREEMENT; ASSIGNMENT. This Agreement (a)
constitutes the entire agreement among the parties with respect to the subject
matter hereof and supersedes all other prior agreements and understandings, both
written and oral, among the parties or any of them with respect to the subject
matter hereof, and (b) shall not be assigned by operation of law or otherwise,
provided that Compass may assign its rights and obligations to any direct or
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indirect, wholly-owned, subsidiary of Compass, but no such assignment shall
relieve Compass of its obligations hereunder.
SECTION 10.4 FURTHER ASSURANCES. From time to time as and when
requested by Compass or its successors or assigns, the Members, the Company and
the managers of the Company shall execute and deliver such further agreements,
documents, deeds, certificates and other instruments and shall take or cause to
be taken such other actions, including those as shall be necessary to vest or
perfect in or to confirm of record or otherwise the Company's title to and
possession of, all of their respective property, interests, assets, rights,
privileges, immunities, powers, franchises and authority, as shall be reasonably
necessary or advisable to carry out the purposes of and effect the transactions
contemplated by this Agreement.
SECTION 10.5 ENFORCEMENT OF THE AGREEMENT. The parties hereto agree
that irreparable damage would occur in the event that any of the provisions of
this Agreement were not performed in accordance with their specific terms or
were otherwise breached. It is accordingly agreed that the parties shall be
entitled to an injunction or injunctions to prevent breaches of this Agreement
and to enforce specifically the terms and provisions hereof, this being in
addition to any other remedy to which they are entitled at law or in equity.
SECTION 10.6 SEVERABILITY. The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or enforceability of
any other provisions of this Agreement, which shall remain in full force and
effect.
SECTION 10.7 NOTICES. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be deemed to have been
duly given when delivered if in person, by cable, telegram or telex or by
telecopy, or five business days after mailing if delivered by registered or
certified mail (postage prepaid, return receipt requested) to the respective
parties as follows:
if to Compass:
Xxxxxxx X. XxXxxxx
Vice Chairman
Compass Bank
00 Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxx 00000
Telecopy No.: (000) 000-0000
Xxxxxx X. Xxxxxx
Associate General Counsel
Compass Bancshares, Inc.
00 Xxxxx 00xx Xxxxxx
Xxxxxxxxxx, Xxxxxxx 00000
Telecopy No.: (000) 000-0000
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with a copy to:
Xxxxxxx X. Xxxxx
Xxxxx Xxxxxxx & Xxxx LLP
0000 Xxxxx Xxxxx, 000 Xxxxxx
Xxxxxxx, Xxxxx 00000
Telecopy No.: (000) 000-0000
if to the Company:
Xxxxxx X. Xxxxxxxx
MegaBank Financial Corporation
0000 Xxxx Xxxxxxxx Xxxx, Xxxxx 000
Xxxxxxxxx, Xxxxxxxx 00000
Telecopy No.: (000) 000-0000
with a copy to:
Xxxxxx X. Xxxxxxx
Xxxxxx Xxxxxxxx Xxxxxx & O'Doriso, a professional corporation
Suite 2600, 0000 00xx Xxxxxx
Xxxxxx, Xxxxxxxx 00000-0000
Telecopy No: (000) 000-0000
or to such other address as the person to whom notice is given may have
previously furnished to the others in writing in the manner set forth above
(provided that notice of any change of address shall be effective only upon
receipt thereof).
SECTION 10.8 GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of Colorado, regardless of
the laws that might otherwise govern under applicable principles of conflicts of
laws thereof.
SECTION 10.9 DESCRIPTIVE HEADINGS. The descriptive headings are
inserted for convenience of reference only and are not intended to be part of or
to affect the meaning or interpretation of this Agreement.
SECTION 10.10 PARTIES IN INTEREST. This Agreement shall be binding upon
and inure solely to the benefit of each party hereto, and nothing in this
Agreement, express or implied, is intended to confer upon any other person any
rights or remedies of any nature whatsoever under or by reason of this
Agreement.
SECTION 10.11 COUNTERPARTS. This Agreement may be executed in two or
more counterparts, each of which shall be deemed to be an original, but all of
which shall constitute one and the same agreement.
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SECTION 10.12 INCORPORATION BY REFERENCES. Any and all schedules,
exhibits, annexes, statements, reports, certificates or other documents or
instruments referred to herein or attached hereto are incorporated herein by
reference hereto as though fully set forth at the point referred to in the
Agreement.
SECTION 10.13 CERTAIN DEFINITIONS.
(a) "Subsidiary" or "Subsidiaries" shall mean, when used with reference
to an entity, any corporation, fifty percent (50%) of the outstanding voting
securities of which are owned directly or indirectly by such entity or any
partnership, joint venture or other enterprise in which any entity has, directly
or indirectly, any equity interest.
(b) "Material Adverse Effect" shall mean any material adverse
circumstance, event or series of events or circumstances with respect to the
financial condition, assets, liabilities (absolute, accrued, contingent or
otherwise), reserves, business or results of operations of the Company taken as
a whole (or when the reference is to Compass, to Compass and its Subsidiaries,
taken as a whole).
(c) "Environmental Laws" shall mean all federal, state and local laws,
ordinances, rules, common law, regulations, guidance documents, directives, and
decisions, interpretations and orders of courts or administrative agencies or
authorities, relating to the release, threatened release, recycling, processing,
use, handling, transportation treatment, storage, disposal, remediation,
removal, inspection or monitoring of, or exposure to, Hazardous Substances or
protection of human health or safety or the environment (including, without
limitation, wildlife, air, surface water, ground water, land surface, and
subsurface strata), including, without limitation, the Comprehensive
Environmental Response Compensation and Liability Act of 1980, as amended
("CERCLA"), the Superfund Amendments and Reauthorization Act of 1986, as amended
("XXXX"), the Resource Conservation and Recovery Act of 1976, as amended
("RCRA"), Hazardous and Solid Waste Amendments of 1984, as amended ("HSWA"), the
Hazardous Materials Transportation Act, as amended ("HMTA"), the Toxic
Substances Control Act ("TSCA"), Occupational Safety and Health Act ("OSHA"),
Federal Water Pollution Control Act, as amended ("FWPCA"), Clean Air Act
("CAA"), and any and all regulations promulgated pursuant to any of the
foregoing, as amended.
(d) "Hazardous Substances" shall mean those substances included within
the statutory or regulatory definitions, listings or descriptions of
"pollutant," "hazardous material," "contaminant," "toxic waste," "hazardous
substance," "hazardous waste," "solid waste," or "regulated substance" pursuant
to CERCLA, XXXX, RCRA, HSWA, HMTA, TSCA, OSHA, and/or any other Environmental
Laws, as amended, and shall include, without limitation, any material, waste or
substance which is or contains explosives, radioactive materials, oil or any
fraction thereof, asbestos, or formaldehyde. To the extent that the laws or
regulations of the State of Colorado establish a meaning for "hazardous
substance," "hazardous waste," "hazardous material," "solid waste," "pollutant,"
"contaminant," "regulated substance," or "toxic waste,"
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which is broader than that specified in any of CERCLA, XXXX, RCRA, HSWA, HMTA,
TSCA, OSHA or any other Environmental Law such broader meaning shall apply.
(e) "Release" shall mean any spilling, leaking, pumping, pouring,
emitting, emptying, discharging, injecting, escaping, leaching, dumping,
disposing, discarding or abandoning.
(f) "Knowledge" or "known" -- An individual shall be deemed to have
"knowledge" of or to have "known" a particular fact or other matter if (i) such
individual is actually aware of such fact or other matter, or (ii) a prudent
individual could be expected to discover or otherwise become aware of such fact
or other matter in the course of conducting a reasonably comprehensive
investigation concerning the truth or existence of such fact or other matter. A
corporation, partnership, limited liability company or trust shall be deemed to
have "knowledge" of or to have "known" a particular fact or other matter if any
individual who is serving, or who has at any time served, as a director or
officer serving in the capacities set forth on Schedule 10.13(f) hereto (or in
any similar capacity) of the corporation, partnership, limited liability company
or trust has, or at any time had, knowledge of such fact or other matter.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, each of the parties has caused this Agreement to be
executed on its behalf by its officers thereunto duly authorized, all as of the
day and year first above written.
ATTEST: COMPASS BANCSHARES, INC.
By /s/ Xxxxxx X. Xxxxxx by /s/ Xxxxxxx X. Xxxxx
--------------------- ---------------------
Its: Assistant Secretary Its Chief Financial Officer
ATTEST: OSAGE 3734 LLC
By______________________ By /s/ Xxxxxxx X. Xxxxxxxxx
-----------------------
Its: Its Manager
MEMBERS
/s/ Xxxx X. Xxxxxxxx
--------------------
Xxxx X. Xxxxxxxx
RESPOND CORP.
By /s/ Xxxxxx X. Xxxxxxxx
-----------------------
Xxxxxx X. Xxxxxxxx, President
KLA/4 FAMILY LIMITED PARTNERSHIP, LLP
By: /s/ Xxxxxxx X. Xxxxxxxxx
------------------------
Xxxxxxx X. Xxxxxxxxx, Partner
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EXHIBIT A
POOLING TRANSFER RESTRICTIONS AGREEMENT
This Pooling Transfer Restrictions Agreement (this "Agreement") is
executed and delivered this ____ day of _________, 1999 by and between Compass
Bancshares, Inc. ("Compass"), Osage 3734 LLC (the "Company"), and the
undersigned member of the Company (the "Member").
WHEREAS, Compass and the Company entered into an Agreement and Plan of
Merger dated _________, 1999 ("Merger Agreement") pursuant to which the Company
will be merged with a to-be-formed subsidiary of Compass (the "Merger"), and
WHEREAS, Compass has required as a condition to entering into the
Merger Agreement that the Company and the Member and each other affiliate of the
Company deliver to Compass an agreement in substantially the form hereof,
NOW, THEREFORE, in consideration of Compass' agreement to enter into
the Merger Agreement and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the undersigned, intending to be
legally bound, hereby agree as follows:
1. The Member agrees that he will not sell, pledge, transfer or
otherwise dispose of any of the Company's membership interests ("Company
Membership Interests"), within 30 days prior to the Effective Time (as defined
in the Merger Agreement). The Member further agrees that until the publication
of financial results covering at least 30 days of post-Merger combined
operations of the Company and Compass, he will not sell, pledge, transfer or
otherwise dispose of any shares of the Compass Common Stock to be acquired by
him in the Merger, except for pledges by the Member of all or part of such
Member's Compass Common Stock acquired in the Merger to secure loans, provided
the lender accepts any pledge of such Compass Common Stock subject to the terms
of this Agreement. The Member further agrees that he will not sell, pledge,
transfer or otherwise dispose of any shares of the Compass Common Stock to be
acquired by him in the Merger except in a manner which is consistent with any
additional requirements for Compass' accounting for the Merger as a pooling of
interests, including without limitation any new requirements imposed by the
applicable provisions of the Securities Act of 1933 (the "Securities Act"), the
Securities Exchange Act of 1934 (the "Exchange Act"), and the respective rules
and regulations thereunder.
2. The Member further acknowledges and agrees that he will be subject
to Rule 145 promulgated by the Securities and Exchange Commission under the
Securities Act, and agrees not to transfer any Compass Common Stock received by
him in the Merger except in compliance with the applicable provisions of the
Securities Act, the Exchange Act, and the respective rules and regulations
thereunder.
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3. The Member agrees that the shares of Compass Common Stock to be
issued to him in the Merger will bear a restrictive transfer legend in
substantially the following form:
The shares represented by this certificate are subject to a Pooling
Transfer Restrictions Agreement dated _______ __, 1999 which restricts
any sale or other transfer of such shares prior to the earlier to occur
of (i) public release by Compass Bancshares, Inc. of 30 days of
post-merger combined operations of Osage 3734 LLC and Compass
Bancshares, Inc., or (ii) [insert due date of next Quarterly Report on
Form 10-Q or Annual Report on Form 10-K that will contain required
financial results.] The issuer will furnish to the record holder of
this certificate, without charge, upon written request to the issuer at
its principal place of business, a copy of the Pooling Transfer
Restrictions Agreement.
Compass agrees to instruct its transfer agent to remove the restrictive legend
from any certificates evidencing shares subject hereto promptly following the
expiration of the transfer restrictions described in Section 1.
4. The Company agrees and the Member acknowledges and agrees that the
Company will not permit the transfer of any Company Membership Interest by the
Member or any other Company affiliate within 30 days prior to the Effective
Time.
5. This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
[SIGNATURE PAGE FOLLOWS]
40
IN WITNESS WHEREOF, the undersigned set his hand effective as of the
day first written above.
COMPASS BANCSHARES, INC.
By:
-----------------------------------
Name:
--------------------------------
Title:
--------------------------------
OSAGE 3734 LLC
By:
-----------------------------------
Name:
--------------------------------
Title:
--------------------------------
-------------------------------------
Signature of Member
-------------------------------------
Printed Name of Member
41
EXHIBIT B
EXCHANGE AGENT AGREEMENT
This Exchange Agent Agreement, dated as of _________, 2000, is made and
entered into by and among Compass Bancshares, Inc., a Delaware corporation
("Compass"), Compass Merger, LLC, a Colorado limited liability company ("Merger
Sub"), Osage 3734 LLC, a Colorado limited liability company ("Company"), and
Continental Stock Transfer & Trust Company, a New York banking corporation
("Exchange Agent").
PREAMBLE:
Pursuant to the Agreement and Plan of Merger dated as of November 4,
1999 ("Merger Agreement") among Compass, Merger Sub, the Company and the Members
of the Company, the Company shall, at the Effective Time, be merged with Merger
Sub. The name of the surviving company shall be Compass Merger, LLC ("Surviving
Company").
After the Effective Time, the outstanding membership interests
(including for this purpose any membership interests which can be acquired upon
the exercise of any warrant, option, right, convertible debt instrument or other
security pursuant to which membership interests may be obtained (collectively,
"Derivative Securities")), of the Company ("Company Membership Interests") shall
solely represent, in the aggregate, the right to payment by Compass of total
Merger Consideration of ______________ shares of Compass common stock, par value
$2.00 per share ("Compass Common Stock") (or cash in lieu of fractional shares).
The Company has requested Compass to designate the Exchange Agent in
connection with the exchange (the "Exchange") of membership interests for shares
of Compass Common Stock, subject to the terms and conditions hereof and of the
Merger Agreement. The Exchange Agent will receive Company Membership Interests
delivered for exchange pursuant to the terms of the Merger Agreement and will
process any related documents. Compass desires that the Exchange Agent act in
such capacity.
NOW THEREFORE, in consideration of the premises and of the mutual
agreements and covenants contained herein, and other good and valuable
consideration, the receipt of which is hereby acknowledged, the parties,
intending to be legally bound, hereby agree as follows:
1. APPOINTMENT OF EXCHANGE AGENT. Continental Stock Transfer & Trust
Company is hereby appointed as the Exchange Agent for payment of the Merger
Consideration to the Members. Such appointment shall be in accordance with the
terms and conditions set forth herein.
2. NO TRANSFER. At the Effective Time, the Company's transfer books
will be closed and no transfers of Membership Interests shall be permitted.
42
3. DUTIES OF EXCHANGE AGENT. The Exchange Agent is authorized and
directed to perform the following functions contemplated by the Merger Agreement
and the Letters of Transmittal (defined below):
(a) DISTRIBUTION OF LETTERS OF TRANSMITTAL. The Exchange Agent
shall mail to the holders of record of Company Membership Interests, by
first class United States mail, postage prepaid, copies of Letters of
Transmittal, including Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9 in substantially the form
attached hereto as EXHIBIT A ("Letters of Transmittal"), and return
envelopes to the Exchange Agent, at the earliest practicable time
following the Effective Time. A form of Membership Interest Assignment
and Power of Attorney will be provided to the Exchange Agent for use by
members if necessary.
(b) ACCEPTANCE OF LETTERS OF TRANSMITTAL.
(i) The Exchange Agent will examine the Letters of Transmittal
and other documents and instruments delivered to the Exchange Agent by
or on behalf of holders tendering Company Membership Interests and
shall determine whether (i) the Letters of Transmittal have been
completed and executed properly, and are accompanied by proper evidence
of authority, (ii) signatures are guaranteed (where required), all in
accordance with the terms and conditions of the Merger Agreement and
the Letters of Transmittal. The Exchange Agent shall accept the
executed Letters of Transmittal which are surrendered in accordance
with the provisions of the Merger Agreement. Such Letters of
Transmittal shall only be accepted by the Exchange Agent and eligible
for payment hereunder if they have been properly executed and completed
in accordance with the instructions contained in the Letters of
Transmittal and, subject to the following sentence, if the person or
persons surrendering such Letters of Transmittal appear as a holder of
record of the amount of membership interests surrendered on the list of
members ("Member List") supplied and certified to the Exchange Agent by
the Company attached as EXHIBIT B hereto. In the event the Exchange
Agent shall have any questions as to whether Letters of Transmittal
have been properly executed and completed, the Exchange Agent shall
promptly refer such questions to Compass for resolution by Compass and
the Exchange Agent shall be able to rely on the written instructions
and decisions of any officer of Compass. Determination of all questions
as to the proper completion or execution of the Letters of Transmittal
for Company Membership Interests shall be made by Compass together with
its attorneys, and such other persons as Compass shall designate, and
such determinations shall be final and binding; provided, however, that
the rejection by Compass of any Letters of Transmittal deemed by
Compass to be ineffective shall not affect the right of any member in
or to his respective share of the Merger Consideration;
(ii) If any defect or irregularity appears to exist in
connection with a purported tender, the Exchange Agent will notify
promptly the persons by whom the tender was
2
43
made and will return all documents delivered in connection therewith or
take such action as is necessary or advisable to cause such defect or
irregularity to be cured;
(iii) Tenders may be made only as set forth in the Letters of
Transmittal;
(iv) Letters of Transmittal, and facsimiles thereof submitted
to the Exchange Agent, shall be marked by the Exchange Agent's
designated officers to show the date and time of receipt and their
review and acceptance thereof;
(v) From time to time as requested by Compass, the Exchange
Agent shall provide Compass with a list of members who have properly
tendered their Company Membership Interests. In addition, the Exchange
Agent shall inform Compass in writing of the number of Company
Membership Interests which have been properly tendered and the number
which have been improperly tendered to the Exchange Agent during the
week then ended and on a cumulative basis through that day. The
Exchange Agent shall provide Compass such other information concerning
the Company Membership Interests as it may reasonably request. Such
communications should be sent to:
Compass Bancshares, Inc.
00 Xxxxx 00xx Xxxxxx
Xxxxxxxxxx, Xxxxxxx 00000
Attn: Xxxxxx X. Xxxxxx
Telephone No. (000) 000-0000
(c) EXCHANGE FUND. In order to provide for payment of the
Merger Consideration in accordance with the terms of the Merger
Agreement, Compass, prior to the Effective Time, shall deposit or cause
to be deposited with the Exchange Agent (i) a sufficient number of
shares of Compass Common Stock pursuant to Section 1.6 of the Merger
Agreement to exchange Compass Common Stock for Company Membership
Interests, and (ii) cash in an amount sufficient to make payments in
lieu of fractional shares (the "Exchange Fund"). This Exchange Fund
shall not be used for any purpose except as provided by this Agreement.
(d) COMPASS COMMON STOCK. Merger Sub and the Company shall
jointly advise the Exchange Agent as to the number of shares of Compass
Common Stock to be distributed to each Member which shall be calculated
by Merger Sub and the Company as follows:
(i) COMPANY MEMBERSHIP INTERESTS. Each holder of
Company Membership Interests shall receive Merger
Consideration equal to ______ shares of Compass Common Stock
for each 1% of Company Membership Interests held immediately
prior to the Effective Time.
(ii) FRACTIONAL SHARES. For each fractional share
of Compass Common Stock which would be delivered upon the
surrender of Company Membership
3
44
Interests, each holder of a Membership Interest shall receive
cash in an amount equal to the product of such fraction and
$ .
-----
As soon as practicable after acceptance of properly executed
Letters of Transmittal in accordance with the terms of paragraph 3(b)
hereof, the Exchange Agent shall issue and mail certificates
representing shares of Compass Common Stock to the Members surrendering
such certificates. The Exchange Agent shall promptly make the payments
in lieu of fractional shares out of the Exchange Fund upon surrender of
the Certificates.
(e) Other Duties of Exchange Agent.
(i) The Exchange Agent shall have no obligation to
make payment for Company Membership Interests unless Compass shall have
issued sufficient Compass Common Stock or caused such stock to be
issued and shall have deposited or caused to be deposited in the
Exchange Fund sufficient cash with which to pay all amounts due and
payable for such shares.
(ii) The Exchange Agent shall be regarded as having
made no representations or warranties as to the validity, sufficiency,
value or genuineness of the Company Membership Interests, and the
Exchange Agent shall not be deemed to have made any representations as
to the value of such membership interests.
(iii) The Exchange Agent may rely on and shall be
protected in acting upon the written instructions of any officer of
Compass or the Surviving Company with respect to any matter relating to
its actions or duties hereunder; and the Exchange Agent shall be
entitled to request further instructions from Compass or the Surviving
Company, as appropriate, and to act in accordance therewith.
(iv) The Exchange Agent may consult attorneys
satisfactory to the Exchange Agent (including, without limitation,
attorneys for Compass or the Surviving Company) and the written advice
and opinion of such attorneys shall constitute full and complete
authorization and protection in respect of any action taken, suffered
or omitted by it hereunder in good faith and in accordance with such
advice or opinion.
(v) The Exchange Agent shall take all other actions
which it or Compass deems necessary or appropriate under the terms of
the Merger Agreement, the Letters of Transmittal and under the customs
and practices normally applied to transactions of this type and
appropriate to the proper transfer of the Company Membership Interests
and the proper maintenance of the Company's and Compass' member and
shareholder books and records. Following payment in accordance with the
terms hereof, the Exchange Agent shall forward to Compass all documents
received by it in connection with tenders of Company Membership
Interests (including Letters of Transmittal, telegrams, facsimile
transmissions or letters representing tenders) Federal Express or other
means acceptable to Compass.
4
45
4. ALTERATION OF INSTRUCTIONS. The Exchange Agent shall follow and act
upon any written amendments, modifications or supplements to these instructions
and upon any further instructions from Compass or the Surviving Company in
connection with the Merger Agreement or any of the transactions contemplated
thereby, provided that such instructions do not cause a reduction in the amount
or eliminate the opportunity of any Member to receive his or her portion of the
Merger Consideration.
5. INDEMNIFICATION OF EXCHANGE AGENT. Compass and the Surviving Company
covenant and agree to indemnify the Exchange Agent and hold it harmless against
any loss, liability or expense it may incur in the absence of negligence or bad
faith on the part of the Exchange Agent arising out of or in connection with the
administration of its duties hereunder, including but not limited to legal fees
and other costs and expenses of defending or preparing to defend against any
claim or liabilities in connection with this Agreement.
6. COMPENSATION FOR SERVICES. Compass shall compensate the Exchange
Agent for its services hereunder.
7. UNCLAIMED FUNDS. Any moneys or certificates deposited hereunder
which shall remain unclaimed by the holders Company Membership Interests for a
period of six (6) months following the Effective Time shall, upon written
request of the Surviving Company, be returned to Compass, plus interest earned
on the cash portion thereof and the holders of Company Membership Interests not
theretofore presented to and accepted by the Exchange Agent shall look to
Compass only, and not the Exchange Agent, for the payment of any Merger
Consideration in respect of such Company Membership interests.
8. INVESTMENT OF EXCHANGE FUND. The Exchange Agent shall deposit
portions of the Exchange Fund only as directed or consented to in writing by the
Surviving Company.
9. AMENDMENT. Except as otherwise expressly provided herein, neither
this Agreement nor any provision hereof may be amended, modified, waived,
discharged or terminated except in a writing signed by all of the parties hereto
prior to the Effective Time or by Compass and the Exchange Agent after the
Effective Time; provided, however, that no amendment shall be made if such
modification shall reduce the amount of or eliminate the opportunity of any
Member to receive his share of the Merger Consideration contemplated by the
Merger Agreement.
10. SECTION HEADINGS. The section headings used herein are for
convenience of reference only and shall not define or limit the provisions of
this Agreement.
11. GOVERNING LAW. THIS AGREEMENT AND THE APPOINTMENT OF THE EXCHANGE
AGENT SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF NEW YORK AND SHALL INURE TO THE BENEFIT OF AND BE BINDING UPON THE SUCCESSORS
AND ASSIGNS OF THE PARTIES HERETO.
5
46
12. NOTICES. Notices under this Agreement shall be deemed given if made
in writing and sent via prepaid first-class United States mail, or by nationally
recognized overnight courier, to:
If to Compass:
Compass Bancshares, Inc.
00 Xxxxx 00xx Xxxxxx
Xxxxxxxxxx, Xxxxxxx 00000
Attn: Xxxxxx X. Xxxxxx
Associate General Counsel
If to the Exchange Agent:
Continental Stock Transfer & Trust Company
0 Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxx X. Xxxxxx
Chairman of the Board
If to the Company prior to the Effective Time:
Osage 3734 LLC
c/o MegaBank Financial Corporation
0000 Xxxx Xxxxxxxx Xxxx, Xxxxx 000
Xxxxxxxxx, Xxxxxxxx 00000
Attn.: Xxxxxx X. Xxxxxxxx
If to Merger Sub or, following
the Effective Time, the
Surviving Company:
Compass Merger, LLC
c/o Compass Bancshares, Inc.
00 Xxxxx 00xx Xxxxxx
Xxxxxxxxxx, Xxxxxxx 00000
Attn: Xxxxxx X. Xxxxxx
13. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
6
47
14. CONFLICT. In the event the terms of this Agreement conflict with
the terms and provisions of the Merger Agreement, the terms and provisions of
the Merger Agreement shall be controlling.
15. DEFINED TERMS. Capitalized terms not defined herein have the
meanings ascribed to them in the Merger Agreement.
[SIGNATURE PAGE FOLLOWS]
7
48
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized appointed officers on the date first written
above.
COMPASS BANCSHARES, INC.
By: ___________________________________
Name: _________________________________
Title:_________________________________
OSAGE 3734 LLC
By: ___________________________________
Name: _________________________________
Title: ________________________________
CONTINENTAL STOCK TRANSFER & TRUST
COMPANY
By: ___________________________________
Name: ________________________________
Title:_________________________________
COMPASS MERGER, LLC
By: ___________________________________
Name: _________________________________
Title:_________________________________
Exhibit A - Form of Letters of Transmittal
Exhibit B - Member List
8
49
EXHIBIT C
The street address of the Property (if applicable) is: 3734 Osgage Street
Denver, CO
The legal description of the Property is:
LOTS 7 THROUGH 12, INCLUSIVE,
BLOCK 2,
CENTRAL SUBDIVISION, AN ADDITION TO XXX XXXX XX XXXXXXXXX,
XXXX XXX XXXXXX XX XXXXXX,
XXXXX OF COLORADO
50
EXHIBIT D
POOLING OF INTEREST CRITERIA
ATTRIBUTES OF COMBINING ENTERPRISES
(a) Autonomy Condition. Each of the combining enterprises is autonomous and
has not been a subsidiary or division of another enterprise within two
years before the plan of combination is initiated.
(b) Independence Condition. Each of the combining enterprises is
independent of the other combining enterprises.
MANNER OF COMBINING INTERESTS
(c) One-Year Rule. The combination is effected in a single transaction or
is completed in accordance with a specific plan within one year after
the plan is initiated.
(d) Common-Stock-for-Common-Stock-Condition. An enterprise offers and
issues only common stock with rights identical to those of the majority
of its outstanding voting common stock in exchange for substantially
all of the voting common stock interest of another enterprise at the
date the plan of combination is consummated.
(e) Change-in-Equity-Interests Condition. None of the combining enterprises
changes the equity interest of the voting common stock in contemplation
of effecting the combination either within two years before the plan of
combination is initiated or between the dates the combination is
initiated and consummated; changes in contemplation of effecting the
combination may include distributions to stockholders and additional
issuances, exchanges, and retirements of securities.
(f) Treasury-Stock Condition. Each of the combining enterprises reacquires
shares of voting common stock only for purposes other than business
combinations, and no enterprise reacquires more than a normal number of
shares between the dates the plan of combination is initiated and
consummated.
(g) Proportionate-Interest Condition. The ratio of the interest of an
individual common stockholder to those of other common stockholders in
a combining enterprise remains the same as a result of the exchange of
stock to effect the combination.
(h) Voting-Rights Condition. The voting rights to which the common stock
ownership interests in the resulting combined enterprise are entitled
are exercisable by the stockholders; the stockholders are neither
deprived of nor restricted in exercising those rights for a period.
-1-
51
(i) Contingency Condition. The combination is resolved at the date the plan
is consummated and no provisions of the plan relating to the issue of
securities or other consideration are pending.
ABSENCE OF PLANNED TRANSACTIONS
(j) The combined enterprise does not agree directly or indirectly to retire
or reacquire all or part of the common stock issued to effect the
combination.
(k) The combined enterprise does not enter into other financial
arrangements for the benefit of the former stockholders of a combining
enterprise, such as a guaranty of loans secured by stock issued in the
combination, that in effect negates the exchange of equity securities.
(l) The combined enterprise does not intend or plan to dispose of a
significant part of the assets of the combining enterprises within two
years after the combination other than disposals in the ordinary course
of business of the formerly separate enterprise and to eliminate
duplicate facilities or excess capacity.
-2-
52
EXHIBIT E
OPINIONS REQUIRED FROM COUNSEL
TO THE COMPANY
--------------
(i) the Company is a Colorado limited liability company. The Company
is duly organized, validly existing and in good standing under the laws of the
State of Colorado. The Company has all requisite corporate power and authority
to carry on its business as we know it to be conducted and to own, lease and
operate its properties and assets as now owned, leased or operated. The Company
is duly qualified and in good standing in Colorado;
(ii) the Company has all requisite power and authority to execute and
deliver the Agreement and any other agreements contemplated by the Agreement
(collectively, the "Other Agreements") and to consummate the transactions
contemplated thereby; all acts (corporate or otherwise) and other proceedings
required to be taken by or on the part of the Company to execute and deliver
the Agreement and the Other Agreements and to consummate the transactions
contemplated therein have been duly and validly taken; and the Agreement and
the Other Agreements have been duly executed and delivered by, and constitute
the valid and binding obligations of the Company enforceable against the
Company in accordance with their terms, subject to the effect of (a) any
applicable bankruptcy, insolvency, reorganization or other law relating to or
affecting creditors' rights generally and (b) general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law);
(iii) the Members own 100% of the authorized membership interests of
the Company; all of the outstanding membership interests of the Company are
validly issued, fully paid and nonassessable;
(iv) to the best of our knowledge, there are no outstanding
subscriptions, options, rights, warrants, calls, convertible securities,
irrevocable proxies, or other agreements or commitments obligating the Company
to issue any membership or other equity interests of, restricting the transfer
of, or otherwise relating to membership or other equity interests of the
Company;
(v) the execution and delivery by the Company of the Agreement does
not and the consummation of the transactions contemplated thereby will not
contravene or violate any provision of or constitute a default under (a) the
articles of organization or operating agreement of the Company, (b) to the best
of our knowledge and except as disclosed in the Agreement, any note, license,
instrument, mortgage, deed of trust, or other agreement or understanding,
permit, authorization or contract, order, arbitration award, judgment or
decree, or any other restriction of any kind or character known to us to which
the Company is a party or by which the Company or any of its assets or
properties is bound, the breach of which could reasonably be expected to have
Material Adverse Effect on the Company taken as a whole, and (c) to the best of
our knowledge and except as disclosed in the Agreement, any law, regulation,
rule, administrative regulation or
53
decree of any court or any governmental agency or body whether domestic or
foreign applicable to the Company or its assets or properties;
(vi) except as disclosed in the Agreement and except for such consents,
approvals, authorizations, actions or filings as have already been obtained by
Compass or Merger Sub, no consent, approval, authorization, action or filing
with any court, governmental agency or public body is required in connection
with the execution, delivery and performance by the Company of the Agreement;
(vii) to the best of our knowledge, the Company is not a party to any
Proceeding (as defined in the Agreement), nor to the best of our knowledge, is
any Proceeding threatened against or affecting the Company;
(viii) to the best of our knowledge and except as set forth on
Schedule 3.16 to the Agreement, the Company is not in material default under any
law or regulation, or under any order of any court, commission, board, bureau,
agency or instrumentality wherever located; and
(ix) upon consummation of the transactions contemplated by the
Agreement in accordance with its terms and upon filing of the Articles of Merger
relating to the Merger by the Secretary of State of Colorado, and upon filing by
the Secretary of State of Colorado of a Certificate of Merger the Merger will
have been legally consummated in accordance with the laws of the State of
Colorado with the consequences specified in Section 7-80-1004 of the Colorado
Limited Liability Company Act.
54
EXHIBIT F
OPINIONS REQUIRED FROM COUNSEL
TO COMPASS AND MERGER SUB
-------------------------
(i) Compass is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware, and Compass is a bank
holding company under the Bank Holding Company Act of 1956, as amended. Merger
Sub is a Colorado limited liability company, duly organized, validly existing
and in good standing under the laws of the state of Colorado. Compass and
Merger Sub have all requisite corporate power and authority to carry on their
business as now being conducted and to own, lease and operate their properties
as now owned, leased or operated. Compass and Merger Sub are duly qualified and
in good standing in the respective states where such qualification is required;
(ii) Compass and Merger Sub each have all requisite power and
authority to execute and deliver the Agreement and to consummate the
transactions contemplated thereby; all acts (corporate or otherwise) and other
proceedings required to be taken by or on the part of Compass and Merger Sub
(or either of them) to execute and deliver the Agreement and to consummate the
transactions contemplated therein have been duly and validly taken; and the
Agreement has been duly executed and delivered by, and constitutes the valid
and binding obligation of each of Compass and Merger Sub enforceable against
Compass and Merger Sub in accordance with its terms, subject to the effect of
(a) any applicable bankruptcy, insolvency, reorganization or other law relating
to or affecting creditors' rights generally and (b) general principles of
equity (regardless of whether such enforceability is considered in a proceeding
in equity or at law);
(iii) the shares of Compass Common Stock to be issued pursuant to the
Agreement are validly issued, fully paid and nonassessable; and, to the best of
our knowledge and except as contemplated by the Agreement, the shares of
Compass Common Stock issued pursuant to the Agreement are not subject to any
agreements or understandings to which Compass is a party with respect to the
voting or transfer of such shares, are not subject to any agreements or
understandings among any other parties with respect to the voting or transfer
of such shares, and have not been issued in violation of the preemptive rights
of any person;
(iv) the execution and delivery by Compass and Merger Sub of the
Agreement does not and the consummation of the transactions contemplated
thereby will not contravene or violate any provision of or constitute a default
under (a) the certificate of incorporation or organization or bylaws or
operating agreement of Compass or Merger Sub, (b) to the best of our knowledge
and except as disclosed in the Agreement, any note, license, instrument,
mortgage, deed of trust, or other agreement or understanding, permit,
authorization or contract, order, arbitration award, judgment of decree, or any
other restriction of any kind known to us to which Compass or Merger Sub is a
party or by which Compass or Merger Sub or any of their assets or properties is
bound, the breach or violation of which could have a material adverse effect on
Compass and its Subsidiaries taken as a whole, and (c) to the best of our
knowledge and except as disclosed in the Agreement, any law, regulation, rule,
administrative regulation or decree of
55
any court or any governmental agency or body applicable to Compass or Merger
Sub or their respective assets or properties;
(v) except as disclosed in the Agreement and except for such
consents, approvals, authorizations, actions or filings as have already been
obtained, no consent, approval, authorization, action or filing with any
court, governmental agency or public body is required in connection with the
execution, delivery and performance by Compass and Merger Sub of the
Agreement;
(vi) to the best of our knowledge, neither Compass nor Merger Sub is
in violation of or default under the respective Certificates of Incorporation
or Organization or Bylaws or Operating Agreement of Compass or Merger Sub or
any agreement, document or instrument under which Compass or Merger Sub is
obligated or bound, or any law, order, judgment, or regulation applicable to
Compass or Merger Sub or any of their Subsidiaries, the violation of which
could have a material adverse effect on Compass and its Subsidiaries taken as
a whole;
(vii) the shares of Compass Common Stock to be issued pursuant to the
Agreement have been registered under the Securities Act of 1933, as amended;
and
(viii) Except as set forth in the Schedules to the Agreement, to the
best of our knowledge, neither Compass nor any of its Subsidiaries is a party
to any Proceeding (as defined in the Agreement), nor to our knowledge is any
Proceeding threatened against Compass or its Subsidiaries which is required to
be disclosed, but has not been disclosed in filings required to be made with
the SEC pursuant to the Exchange Act.
56
EXHIBIT G
RELEASE OF CLAIMS
-----------------
THIS RELEASE OF CLAIMS ("Release") dated the __ day of ______, 2000,
is executed and delivered by the person executing below to OSAGE 3734 LLC, a
Colorado limited liability company (the "Company").
WHEREAS, Compass Bancshares, Inc. ("Compass") is to acquire the
Company pursuant to that certain Agreement and Plan of Merger dated as of
November 4, 1999, by and between Compass and the Company, as amended (the
"Agreement"), whereby the Company will be merged with a wholly-owned
subsidiary of Compass; and
WHEREAS, Compass has required as a condition to such acquisition that
the undersigned execute and deliver this Release to confirm the absence of any
claims by the undersigned against the Company;
NOW, THEREFORE, in consideration of the premises contained herein and
ten dollars and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the undersigned hereby agrees as
follows:
Section 1. RELEASE. The undersigned hereby RELEASES and FOREVER
DISCHARGES the Company from all manners of action, causes of action, suits,
debts, sums of money, accounts, reckonings, bonds, bills, specialties,
covenants, contracts, controversies, agreements, premises, variances,
trespasses, damages, judgments, executions, claims and demands whatsoever in
law or in equity which the undersigned ever had, now has, or hereafter can,
shall or may have against the Company, in respect of any and all agreements
and obligations incurred on or prior to the date hereof, or in respect of any
event occurring or circumstances existing on or prior to the date hereof;
provided, however, that the Company shall not be released from any of its
obligations or liabilities to the undersigned (i) in respect of accrued
compensation permitted by any written agreement with the Company which is
attached hereto as EXHIBIT A or which has been scheduled and made part of the
Agreement; (ii) in connection with any indebtedness or contractual obligation
or liability to the undersigned existing on the date hereof; and (iii) as to
rights of indemnification pursuant to the Articles of Organization and
Operating Agreement of the Company.
Section 2. SUCCESSORS. This Release shall be binding upon the
undersigned and his or her heirs, devisees, administrators, executors,
personal representatives, successors and assigns and shall inure to the
benefit of the Company and its successors and assigns.
Section 3. GOVERNING LAW. This Release shall be governed by and
construed in accordance with the laws of the State of Colorado, without giving
effect to Colorado principles of conflicts of law.
57
Section 4. COUNTERPARTS. This Release may be executed in several
counterparts, each of which shall be deemed to be an original and all of which
shall constitute one and the same instrument.
Section 5. MODIFICATION. This Release may be modified only by a
written instrument executed by the undersigned and the Company.
IN WITNESS WHEREOF, the undersigned has executed this Release
effective as of the date first above written.
___________________________________
Signature
___________________________________
Printed Name
STATE OF COLORADO ss.
ss.
COUNTY OF _______ ss.
This instrument was acknowledged before me on ________, 2000 by
____________________.
___________________________________
Notary Public in and for the
State of Colorado
___________________________________
Notary's Name Typed or Printed
My Commission Expires:_____________
58
EXHIBIT A
---------
59
EXHIBIT H
RELEASE OF CLAIMS
THIS RELEASE OF CLAIMS ("Release") dated the ___ day of ____, 2000, is
executed and delivered by OSAGE 3734 LLC, a Colorado limited liability company
(the "Company").
WHEREAS, the persons listed on EXHIBIT A attached hereto and made a
part hereof constitute the duly elected managers ("Managers") of the Company on
the date hereof;
WHEREAS, Compass Bancshares, Inc., a Delaware corporation ("Compass"),
is to acquire the Company pursuant to that certain Agreement and Plan of Merger
dated as of November 4, 1999 by and between Compass and the Company, as amended
("Agreement"), whereby the Company will be merged with a wholly-owned subsidiary
of Compass; and
WHEREAS, the Company has required as a condition to such acquisition
that the Managers be released of any claims by the Company against the Managers;
NOW, THEREFORE, in consideration of the premises contained herein and
ten dollars and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company hereby agrees as
follows:
Section 1. RELEASE. The Company hereby RELEASES and FOREVER DISCHARGES
the Managers from all manners of action, causes of action, suits, debts, sums of
money, accounts, reckonings, bonds, bills, specialties, covenants, contracts,
controversies, agreements, premises, variances, trespasses, damages, judgments,
executions, claims and demands whatsoever in law or in equity which the Company
ever had, now has, or hereafter can, shall or may have against the Managers, in
respect of any and all agreements and obligations incurred on or prior to the
date hereof, or in respect of any event occurring or circumstances existing on
or prior to the date hereof; provided, however, that no Manager shall be
released from (i) any action arising from intentional fraud, deceit or wilful
misconduct in connection with the transactions contemplated by the Agreement or
otherwise, or (ii) his or her obligations or liabilities to the Company in
connection with any indebtedness or any contractual obligation or liability of
such Manager to the Company existing on the date hereof.
Section 2. SUCCESSORS. This Release shall be binding upon the Company
and its successors and assigns and shall inure to the benefit of the Managers
and their respective heirs, devisees, administrators, executors, successors and
assigns.
Section 3. GOVERNING LAW. This Release shall be governed by and
construed in accordance with the laws of the State of Colorado,
without giving effect to Colorado principles of conflicts of law.
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Section 4. COUNTERPARTS. This Release may be executed in several
counterparts, each of which shall be deemed to be an original and all of which
shall constitute one and the same instrument.
Section 5. MODIFICATION. This Release may be modified as to any Manager
only by a written instrument executed by the undersigned and such Manager.
IN WITNESS WHEREOF, the Company has executed this Release effective as
of the date first above written.
OSAGE 3734 LLC
By:_____________________________________
Name:___________________________________
Title:__________________________________
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STATE OF COLORADO sec.
sec.
COUNTY OF ________ sec.
This instrument was acknowledged before me on ________, 2000, by
____________________, the ______________ of OSAGE 3734 LLC.
_______________________________________
Notary Public in and for the
State of Colorado
_______________________________________
Notary's Name Typed or Printed
My Commission Expires:_________________
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EXHIBIT A
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Managers
