EXHIBIT 2.1
AGREEMENT AND PLAN OF MERGER
BY AND BETWEEN
FIRST NATIONAL BANKSHARES OF FLORIDA, INC.
AND
SOUTHERN COMMUNITY BANCORP
DATED AS OF MARCH 19, 2004
LIST OF EXHIBITS
EXHIBIT
NUMBER DESCRIPTION
------ -----------
1 Form of agreement of affiliates of SCB (Section 8.10)
2 Description of employment terms (Section 8.11)
3 Form of outside directors' Non-Compete Agreement (Section 9.2(e))
4 Form of opinion of Xxxxxx & Xxxxx LLP (Section 9.2(f))
5 Form of opinion of Xxxxx, Xxxxxxxx & Xxxxxxx LLP (Section 9.3(d))
AGREEMENT AND PLAN OF MERGER
THIS AGREEMENT AND PLAN OF MERGER (this "Agreement") is made and
entered into as of the 19th day of March 2004, by and between FIRST NATIONAL
BANKSHARES OF FLORIDA, INC., a Florida corporation ("FLB"), and SOUTHERN
COMMUNITY BANCORP, a Florida corporation ("SCB").
PREAMBLE
The Boards of Directors of SCB and FLB believe that the transactions
described herein are in the best interests of the parties and their respective
shareholders. This Agreement provides for the acquisition of SCB by FLB pursuant
to the merger of SCB with and into FLB (the "Merger"). At the effective time of
such Merger, the outstanding shares of the capital stock of SCB shall be
converted into the right to receive shares of the common stock of FLB (except as
provided herein). As a result, shareholders of SCB shall become shareholders of
FLB. The transactions described in this Agreement are subject to the approvals
of the shareholders of SCB and FLB, the Board of Governors of the Federal
Reserve System and the Office of the Comptroller of the Currency, and the
satisfaction of certain other conditions described in this Agreement. It is the
intention of the parties to this Agreement that the Merger for federal income
tax purposes shall qualify as a "reorganization" within the meaning of Section
368(a) of the Internal Revenue Code.
Certain terms used in this Agreement are defined in Section 11.1 of
this Agreement.
NOW, THEREFORE, in consideration of the above and the mutual
warranties, representations, covenants and agreements set forth herein, the
parties agree as follows:
ARTICLE 1
TRANSACTIONS AND TERMS OF MERGER
1.1 Merger. Subject to the terms and conditions of this Agreement,
at the Effective Time, SCB shall be merged with and into FLB in accordance with
the provisions of the FBCA. At the Effective Time, the separate existence of SCB
shall cease, and FLB shall be the surviving corporation resulting from the
Merger (the "Surviving Corporation") and shall continue to be governed by the
Laws of the State of Florida. From and after the Effective Time, the Merger
shall have the effects specified in the FBCA. The Merger shall be consummated
pursuant to the terms of this Agreement, which has been approved and adopted by
the respective Boards of Directors of SCB and FLB.
1.2 Time and Place of Closing. The closing of the transactions
contemplated by this Agreement (the "Closing"), including the Merger, shall take
place on a date and at a time specified by the Parties as they, acting through
their chief executive officers, may mutually agree. Subject to the terms and
conditions hereof, unless mutually agreed upon in writing by each Party, the
Parties shall use commercially reasonable efforts to cause the Closing to occur
on, but not prior to, the fifth business day following the Approval Date.
1.3 Effective Time. The Merger and other transactions contemplated
by this Agreement shall become effective upon (i) the date and time at which the
Articles of Merger shall have been accepted for filing by the Florida Department
of State, or (ii) such later date and time as is agreed in writing by FLB and
SCB and specified in the Articles of Merger (the time at which the Merger
becomes effective referred to herein as the "Effective Time"). Unless FLB and
SCB otherwise mutually agree in writing, the Parties to this Agreement shall use
their best efforts to cause the Effective Time to occur on the date of Closing.
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ARTICLE 2
TERMS OF MERGER
2.1 Articles of Incorporation. The Articles of Incorporation of
FLB in effect at the Effective Time shall be the Articles of Incorporation of
the Surviving Corporation until otherwise amended or repealed in accordance with
applicable Law.
2.2 Bylaws. The Bylaws of FLB in effect at the Effective Time
shall be the Bylaws of the Surviving Corporation until otherwise amended or
repealed in accordance with applicable Law.
2.3 FLB Board of Directors. Following the Effective Time, the
number of members of the FLB Board of Directors shall be increased by three
(which shall be accomplished by creating one vacancy in each of the three
classes of FLB directors) and three of the present members of the Board of
Directors of SCB selected by SCB (subject to the consent of FLB, which shall not
be unreasonably withheld) shall be elected by the FLB Board of Directors to fill
the vacancies so created. In connection with the annual meeting of FLB next
following the Effective Time, FLB shall nominate the SCB Directors for election
as directors by the stockholders of FLB, to continue serving in the class to
which such directors were appointed and FLB shall solicit proxies for such
directors' election at such annual meeting. The term "SCB Directors" shall mean
the individuals who shall be designated to become members of the Board of
Directors of FLB as of the Effective Time pursuant to this Section 2.3.
2.4 First National Bank of Florida Board of Directors. Following
the Effective Time, FLB shall cause a minimum of two of the members of the Board
of Directors of SCB selected by SCB (subject to the consent of FLB, which shall
not be unreasonably withheld) to be elected as directors of the First National
Bank of Florida.
ARTICLE 3
MANNER OF CONVERTING SHARES
3.1 Conversion of Shares. Subject to the provisions of this
Article 3, at the Effective Time, by virtue of the Merger and without any action
on the part of FLB, or SCB, or the shareholders of either, the shares of the
constituent corporations shall be converted as follows:
(a) Each share of FLB Capital Stock issued and
outstanding immediately prior to the Effective Time shall remain issued and
outstanding from and after the Effective Time.
(b) Subject to Section 3.4 relating to fractional shares,
each share of SCB Common Stock (excluding shares to be cancelled pursuant to
Section 3.3 of this Agreement) issued and outstanding at the Effective Time
shall cease to be outstanding and shall be converted into and exchanged for a
number of shares of FLB Common Stock equal to the Exchange Ratio.
(c) As used herein, the following terms shall have the meanings
set forth below:
"Exchange Ratio" shall mean 1.62; provided, that if the
Closing FLB Value is greater than $20.00, then the term "Exchange
Ratio" shall be equal to the quotient obtained by dividing the SCB
Value by the Closing FLB Value, rounded to the nearest ten-thousandth.
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"SCB Value" shall mean the sum of (i) $32.40 and (ii) one-half
the difference obtained by subtracting $32.40 from the product of 1.62
multiplied by the Closing FLB Value.
"Closing FLB Value" shall mean the average per share closing
price of FLB Common Stock on the NYSE over the twenty consecutive
trading days ending on the fifth trading day preceding the Effective
Time.
3.2 Anti-Dilution Provisions. In the event FLB changes the number
of shares of FLB Common Stock issued and outstanding prior to the Effective Time
as a result of a stock split, stock dividend, recapitalization, reclassification
or similar transaction with respect to such stock and the record date therefor
(in the case of a stock dividend) or the effective date thereof (in the case of
a stock split or similar recapitalization for which a record date is not
established) shall be prior to the Effective Time, the Exchange Ratio shall be
adjusted in a manner that shall result in each share of SCB Common Stock being
exchanged into shares of FLB Common Stock having the same value as would have
occurred had such stock split, stock dividend, recapitalization,
reclassification or similar transaction not occurred.
3.3 Shares Held by SCB or FLB. Each share of SCB Common Stock, if
any, held by any SCB Company or by any FLB Company, in each case other than in a
fiduciary capacity or as a result of debts previously contracted, shall be
canceled and retired at the Effective Time and no consideration shall be issued
in exchange therefor.
3.4 Fractional Shares. Each shareholder of SCB will have the
option of enrolling the shares of FLB Common Stock issued to such shareholder
pursuant to the Merger in FLB's Dividend Reinvestment and Stock Purchase Plan
(the "DRIP Plan"). Notwithstanding any other provision of this Agreement, each
holder of SCB Common Stock exchanged pursuant to the Merger who elects not to
enroll in the DRIP Plan and who would otherwise have been entitled to receive a
fraction of a share of FLB Common Stock (after taking into account all
certificates delivered by such holder) shall receive, in lieu thereof, cash
(without interest) in an amount equal to such fractional part of a share of FLB
Common Stock multiplied by the closing price of FLB Common Stock as reported by
the NYSE on the last trading day preceding the Closing. No such holder will be
entitled to dividends, voting rights, or any other rights as a shareholder in
respect of any fractional shares. Each shareholder of SCB electing to enroll in
the DRIP Plan will receive his or her share of FLB Common Stock issued pursuant
to the Merger in book-entry form, with any fractional share rounded to the third
decimal place, and such shareholder will be entitled to dividends and voting
rights with respect to such fractional share.
3.5 Treatment of Options and Warrants.
(a) At the Effective Time, each option, warrant or other
right to purchase or acquire SCB Common Stock (collectively, the "SCB Options")
pursuant to stock awards, stock options, stock appreciation rights, or other
benefits granted by SCB pursuant to any employee stock option plan or other
arrangement of SCB ("SCB Stock Plans"), which SCB Options are outstanding at the
Effective Time of the Merger, whether or not such SCB Options are then vested or
exercisable, shall be converted into and become rights with respect to FLB
Common Stock, and FLB shall assume each SCB Option, in accordance with the terms
of the SCB Stock Plans, stock option agreement, or warrant agreement by which it
is evidenced, except that from and after the Effective Time (i) FLB and its
Compensation Committee shall be substituted for SCB and the compensation
committee of SCB's Board of Directors, including, if applicable, the entire
Board of Directors of SCB, administering such SCB Stock Plans, (ii) each SCB
Option assumed by FLB may be exercised solely for shares of FLB Common Stock,
(iii) the number of shares of FLB Common Stock subject to each such SCB Option
shall be equal to the number of shares of SCB Common Stock subject to each such
SCB Option immediately prior to the Effective Time multiplied by the Exchange
Ratio, and (iv) the per share exercise price under each such SCB Option
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will be adjusted by dividing the per share exercise price under each such SCB
Option by the Exchange Ratio and rounding up to the nearest cent.
Notwithstanding the provisions of clause (iii) of the preceding sentence, FLB
shall not be obligated to issue any fraction of a share of FLB Common Stock upon
exercise of SCB Options and any fraction of a share of FLB Common Stock that
otherwise would be subject to a converted SCB Option shall represent the right
to receive a cash payment equal to the product of such fraction and the
difference between the market value of one share of FLB Common Stock on the date
of exercise and the per share exercise price of such Option. SCB and FLB agree
to take all necessary steps to effectuate the foregoing provisions of this
Section 3.5.
(b) As soon as practicable after the Effective Time, FLB
shall deliver to the participants in each SCB Stock Plans an appropriate notice
setting forth such participant's rights pursuant thereto and the grants pursuant
to such SCB Stock Plans shall continue in effect on the same terms and
conditions (subject to the adjustments required by Section 3.5(a) of this
Agreement after giving effect to the Merger), and FLB shall comply with the
terms of each SCB Stock Plans to ensure, to the extent required by, and subject
to the provisions of, such SCB Stock Plans, that SCB Options which qualified as
incentive stock options prior to the Effective Time continue to qualify as
incentive stock options after the Effective Time. At or prior to the Effective
Time, FLB shall take all corporate action necessary to reserve for issuance
sufficient shares of FLB Common Stock for delivery upon exercise of SCB Options
assumed by it in accordance with this Section 3.5. As soon as practicable after
the Effective Time, and, in any event within 10 days after the Effective Date,
FLB shall file a registration statement on Form S-3 or Form S-8, as the case may
be (or any successor or other appropriate forms), with respect to the shares of
FLB Common Stock subject to such SCB Options and shall use its reasonable
efforts to maintain the effectiveness of such registration statement (and
maintain the current status of the prospectus or the prospectuses contained
therein), for so long as such options remain outstanding. With respect to
individuals who subsequent to the Merger will be subject to the reporting
requirements under Section 16(a) of the 1934 Act, where applicable, FLB shall
administer the SCB Stock Plans assumed pursuant to this Section 3.5 in a manner
which complies with Rule 16b-3 promulgated under the 1934 Act to the extent the
SCB Stock Plans complied with such Rule prior to the Merger.
(c) All restrictions or limitations on transfer with
respect to the SCB Common Stock awarded under the SCB Stock Plans or any other
plan, program, or arrangement of SCB, to the extent that such restrictions or
limitations shall not have already lapsed, and except as otherwise expressly
provided in such plan, program, or arrangement, shall remain in full force and
effect. FLB acknowledges that all outstanding options under SCB Stock Plans will
be fully vested as of the Effective Time.
ARTICLE 4
EXCHANGE OF SHARES
4.1 Exchange Procedures. At the Effective Time, FLB shall deposit,
or shall cause to be deposited, with First National Bank of Florida, a wholly
owned subsidiary of FLB (the "Exchange Agent") certificates evidencing shares of
FLB Common Stock and cash in such amounts necessary to provide all consideration
required to be exchanged by FLB for shares of SCB Common Stock pursuant to the
terms of this Agreement. Promptly after the Effective Time, FLB shall cause the
Exchange Agent to mail to the former shareholders of SCB appropriate transmittal
materials (which shall specify that delivery shall be effected, and risk of loss
and title to the certificates theretofore representing shares of SCB Common
Stock shall pass, only upon proper delivery of such certificates to the Exchange
Agent). After the Effective Time, each holder of shares of SCB Common Stock
(other than shares to be canceled pursuant to Section 3.3 of this Agreement)
issued and outstanding at the Effective Time shall surrender the certificate or
certificates representing such shares (the "Certificates") to the Exchange Agent
and shall
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upon surrender thereof promptly receive in exchange therefor the consideration
provided in Section 3.1 of this Agreement, together with all declared but
undelivered dividends or distributions in respect of such shares (without
interest thereon) pursuant to Section 4.2 of this Agreement. To the extent
required by Section 3.4 of this Agreement, each holder of SCB Common Stock
issued and outstanding at the Effective Time also shall receive, upon surrender
of such holder's Certificates, cash in lieu of any fractional share of FLB
Common Stock to which such holder may be otherwise entitled (without interest).
FLB shall not be obligated to deliver the consideration to which any former
holder of SCB Common Stock is entitled as a result of the Merger until either
such holder surrenders such holder's Certificates for exchange as provided in
this Section 4.1; or, in the event that such Certificates have been lost, stolen
or destroyed, such holder complies with Section 4.3. The Certificates so
surrendered shall be duly endorsed as the Exchange Agent may require. Any other
provision of this Agreement notwithstanding, neither FLB nor the Exchange Agent
shall be liable to a holder of SCB Common Stock for any amounts paid or property
delivered in good faith to a public official pursuant to any applicable
abandoned property Law.
4.2 Rights of Former SCB Shareholders. The stock transfer books of
SCB shall be closed as to holders of SCB Common Stock immediately prior to the
Effective Time and no transfers of SCB Common Stock by any such holder shall
thereafter be made or recognized. Until surrendered for exchange in accordance
with the provisions of Section 4.1 of this Agreement, each Certificate
theretofore representing SCB Common Stock (other than shares to be canceled
pursuant to Section 3.3 of this Agreement) shall from and after the Effective
Time represent for all purposes only the right to receive the consideration
provided in Sections 3.1 and 3.4 of this Agreement in exchange therefor,
subject, however, to FLB's obligation to pay any dividends or make any other
distributions with a record date prior to the Effective Time which have been
declared or made by SCB in respect of such SCB Common Stock in accordance with
the terms of this Agreement and which remain unpaid at the Effective Time. Until
90 days after the Effective Time, former shareholders of record of SCB shall be
entitled to vote at any meeting of FLB stockholders the number of shares of FLB
Common Stock into which their respective shares of SCB Common Stock are
converted, regardless of whether such holders have exchanged their Certificates
for certificates representing FLB Common Stock in accordance with the provisions
of this Agreement. Whenever a dividend or other distribution is declared by FLB
on the FLB Common Stock, the record date for which is at or after the Effective
Time, the declaration shall include dividends or other distributions on all
shares issuable pursuant to this Agreement, but beginning 30 days after the
Effective Time no dividend or other distribution payable to the holders of
record of FLB Common Stock as of any time subsequent to the Effective Time shall
be delivered to the holder of any Certificate until such holder surrenders such
Certificate for exchange as provided in Section 4.1 of this Agreement, or
complies with Section 4.3, if applicable. However, upon surrender of such
Certificate or upon compliance with Section 4.3, both the FLB Common Stock
certificate (together with all such undelivered dividends or other distributions
without interest) and any undelivered dividends and cash payments to be paid for
fractional share interests (without interest) shall be delivered and paid with
respect to each share represented by such Certificate. Any portion of the
consideration (including the proceeds of any investments thereof) which had been
made available to the Exchange Agent pursuant to Section 4.1 of this Agreement
that remains unclaimed by the shareholders of SCB for 12 months after the
Effective Time shall be paid to FLB. Any shareholders of SCB who have not
theretofore complied with this Article 4 shall thereafter look only to FLB
(subject to abandoned property, escheat or similar laws) and only as general
creditors thereof for payment of their shares of FLB Common Stock, cash in lieu
of fractional shares, and unpaid dividends and distributions on the FLB Common
Stock deliverable in respect of each SCB Common Share such shareholder holds as
determined pursuant to this Agreement, in each case, without any interest
thereon.
4.3 Lost Stock Certificates. In the event any Certificate shall
have been lost, stolen or destroyed, upon the making of an affidavit of that
fact by the person claiming such Certificate to be lost, stolen or destroyed
and, if reasonably required by FLB, the posting by such person of a bond in such
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amount as FLB may determine is reasonably necessary as indemnity against any
claim that may be made against it with respect to such Certificate, the Exchange
Agent will issue in exchange for such lost, stolen or destroyed Certificate the
shares of FLB Common Stock and any cash in lieu of fractional shares deliverable
in respect thereof pursuant to this Agreement.
ARTICLE 5
REPRESENTATIONS AND WARRANTIES OF SCB
SCB hereby represents and warrants to FLB as follows:
5.1 Organization, Standing, and Power. SCB is a corporation duly
organized, validly existing, and its status is active under the laws of the
State of Florida, and has the corporate power and authority to carry on its
business as now conducted and to own, lease and operate its material Assets. SCB
is duly qualified or licensed to transact business as a foreign corporation and
is in good standing in each jurisdiction where the character of its Assets or
the nature or conduct of its business requires it to be so qualified or
licensed, except for such jurisdictions in which the failure to be so qualified
or licensed is not reasonably likely to have, individually or in the aggregate,
a Material Adverse Effect on SCB.
5.2 Authority; No Breach by Agreement.
(a) SCB has the corporate power and authority necessary
to execute and deliver this Agreement and, subject to the approval and adoption
of this Agreement by the shareholders of SCB and to such Consents of Regulatory
Authorities as required under applicable Law, to perform its obligations under
this Agreement and consummate the transactions contemplated hereby. The
execution, delivery and performance of this Agreement by SCB and the
consummation by SCB of the transactions contemplated herein, including the
Merger, have been duly and validly authorized by all necessary corporate action
in respect thereof on the part of SCB, subject to the approval of this Agreement
by its shareholders as contemplated by Section 8.1 of this Agreement. Subject to
such requisite shareholder approval (and assuming due authorization, execution
and delivery by FLB) and to such Consents of Regulatory Authorities as required
by applicable law, this Agreement represents a legal, valid and binding
obligation of SCB, enforceable against SCB in accordance with its terms (except
in all cases as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar Laws affecting the enforcement
of creditors' rights generally and except that the availability of the equitable
remedy of specific performance or injunctive relief is subject to the discretion
of the court before which any proceeding may be brought).
(b) Neither the execution and delivery of this Agreement
by SCB, nor the consummation by SCB of the transactions contemplated hereby, nor
compliance by SCB with any of the provisions hereof, will (i) conflict with or
result in a breach of any provision of SCB's Articles of Incorporation or
Bylaws, or, (ii) constitute or result in a Default under, or require any Consent
pursuant to, or result in the creation of any Lien on any Asset of any SCB
Company under, any Contract or Permit of any SCB Company, where such Default or
Lien, or any failure to obtain such Consent, is reasonably likely to have,
individually or in the aggregate, a Material Adverse Effect on SCB, or (iii)
subject to receipt of the requisite Consents referred to in Section 9.1(a), (b)
and (c) of this Agreement, violate any Order or any Law applicable to any SCB
Company or any of their respective material Assets which will have a Material
Adverse Effect on SCB.
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(c) Other than in connection or compliance with the
provisions of the Securities Laws, applicable state corporate and securities
Laws, and other than Consents required from Regulatory Authorities, and other
than notices to or filings with the Internal Revenue Service or the Pension
Benefit Guaranty Corporation with respect to any employee benefit plans, or
under the HSR Act, and other than Consents, filings, or notifications which, if
not obtained or made, are not reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect on SCB, no notice to, filing with, or
Consent of, any public body or authority is necessary for the consummation by
SCB of the Merger and the other transactions contemplated in this Agreement.
5.3 Capital Stock.
(a) The authorized capital stock of SCB consists of
10,000,000 shares of SCB Common Stock, of which 7,215,561 shares are issued and
outstanding as of the date of this Agreement. All of the issued and outstanding
shares of capital stock of SCB are duly and validly issued and outstanding and
are fully paid and nonassessable under the FBCA. None of the outstanding shares
of capital stock of SCB has been issued in violation of any preemptive rights.
SCB has reserved 2,612,378 shares of SCB Common Stock for issuance under the SCB
Stock Plans, pursuant to which, as of the date of this Agreement, options and
warrants to purchase not more than 1,070,940 shares of SCB Common Stock are
outstanding.
(b) Except as set forth in Section 5.3(a) of this
Agreement, there are no shares of capital stock or other equity securities of
SCB outstanding and no outstanding Rights relating to the capital stock of SCB.
5.4 SCB Subsidiaries. Except as disclosed in Section 5.4 of the
SCB Disclosure Memorandum, the list of Subsidiaries of SCB filed by SCB as
Exhibit 21.1 to its Annual Report on Form 10-K for the fiscal year ended
December 31, 2002 is a true and complete list of all of the SCB Subsidiaries as
of the date of this Agreement. Except as disclosed in Section 5.4 of the SCB
Disclosure Memorandum, SCB or one of its Subsidiaries owns all of the issued and
outstanding shares of capital stock of each SCB Subsidiary. No equity securities
of any SCB Subsidiary are or may become required to be issued (other than to
another SCB Company) by reason of any Rights, and there are no Contracts by
which any SCB Subsidiary is bound to issue (other than to another SCB Company)
additional shares of its capital stock or Rights or by which any SCB Company is
or may be bound to transfer any shares of the capital stock of any SCB
Subsidiary (other than to another SCB Company). There are no Contracts relating
to the rights of any SCB Company to vote or to dispose of any shares of the
capital stock of any SCB Subsidiary. All of the shares of capital stock of each
SCB Subsidiary held by a SCB Company are fully paid and nonassessable under the
applicable corporation Law of the jurisdiction in which such Subsidiary is
incorporated or organized, and are owned by such SCB Company free and clear of
any Liens. Each SCB Subsidiary is either a bank or a corporation, and is duly
organized, validly existing and (as to corporations) in good standing under the
Laws of the jurisdiction in which it is incorporated or organized, and has the
corporate power and authority necessary for it to own, lease and operate its
Assets and to carry on its business as now conducted. Each SCB Subsidiary is
duly qualified or licensed to transact business as a foreign corporation and is
in good standing in each jurisdiction where the character of its Assets or the
nature or conduct of its business requires it to be so qualified or licensed,
except for such jurisdictions in which the failure to be so qualified or
licensed is not reasonably likely to have, individually or in the aggregate, a
Material Adverse Effect on SCB. Each SCB Subsidiary that is a depository
institution is an "insured institution" as defined in the Federal Deposit
Insurance Act and applicable regulations thereunder.
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5.5 SEC Filings; Financial Statements
(a) SCB has filed and made available to FLB accurate and
complete copies of all SEC Documents required to be filed by SCB with the SEC
since January 1, 2000 (collectively, the "SCB SEC Reports"). The SCB SEC Reports
(i) at the time filed, complied in all material respects with the applicable
requirements of the 1933 Act and the 1934 Act, as the case may be, and (ii) did
not at the time they were filed (or if amended or superseded by a filing prior
to the date of this Agreement, then on the date of such filing) contain any
untrue statement of a material fact or omit to state a material fact required to
be stated in such SCB SEC Reports or necessary in order to make the statements
in such SCB SEC Reports, in light of the circumstances under which they were
made, not misleading. Except for SCB Subsidiaries that are registered as
brokers, dealers, investment advisers or associated persons thereof, none of the
SCB Subsidiaries is required to file any forms, reports or other documents with
the SEC.
(b) Each of the SCB Financial Statements (including, in
each case, any related notes) contained in the SCB SEC Reports complied, and
each SEC Document filed by SCB after the date of this Agreement until the
Effective Time will comply, as to form in all material respects with the
applicable published rules and regulations of the SEC with respect thereto, was
or will be prepared in accordance with GAAP applied on a consistent basis
throughout the periods involved (except as may be indicated in the notes to such
financial statements or, in the case of unaudited statements, as permitted by
Form 10-QSB of the SEC), and fairly presented the consolidated financial
position of SCB and its Subsidiaries at the respective dates and the
consolidated results of its operations and cash flows for the periods indicated,
except that the unaudited interim financial statements were or are subject to
normal and recurring adjustments which were not or are not expected to be
material in amount.
5.6 Absence of Certain Changes or Events. Since the date of the
most recent balance sheet of SCB contained in the Form 10-K or Form 10-Q most
recently filed by SCB, there have been no events, changes or occurrences which
have had, or are reasonably likely to have, individually or in the aggregate, a
Material Adverse Effect on SCB.
5.7 Tax Matters
(a) All Tax Returns required to be filed by or on behalf
of any of the SCB Companies have been timely filed or requests for extensions
have been timely filed, granted, and have not expired for periods ended on or
before December 31, 2002, and on or before the date of the most recent fiscal
year end immediately preceding the Effective Time, except to the extent that all
such failures to file, taken together, are not reasonably likely to have a
Material Adverse Effect on SCB, and all Tax Returns filed are complete and
accurate in all material respects. All Taxes shown on filed Tax Returns have
been paid. There is no audit examination, deficiency, or refund Litigation with
respect to any Taxes that is reasonably likely to result in a determination that
would have, individually or in the aggregate, a Material Adverse Effect on SCB,
except as reserved against in the SCB Financial Statements delivered prior to
the date of this Agreement. All Taxes and other liabilities due with respect to
completed and settled examinations or concluded Litigation have been paid.
(b) Adequate provision for any Taxes due or, to the
Knowledge of SCB, to become due for any of the SCB Companies for the period or
periods through and including the date of the respective SCB Financial
Statements has been made and is reflected on such SCB Financial Statements.
(c) Deferred Taxes of the SCB Companies have been
adequately provided for in the SCB Financial Statements.
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(d) Each of the SCB Companies is in compliance with, and
its records contain all information and documents (including properly completed
Internal Revenue Service Forms W-9) necessary to comply with, all applicable
information reporting and Tax withholding requirements under federal, state and
local Tax Laws, and such records identify with specificity all accounts subject
to backup withholding under Section 3406 of the Internal Revenue Code, except
for such instances of noncompliance and such omissions as are not reasonably
likely to have, individually or in the aggregate, a Material Adverse Effect on
SCB.
(e) None of the SCB Companies has distributed stock of
another Person, or has had its stock distributed by another Person, in a
transaction that was purported or intended to be governed in whole or in part by
Section 355 or Section 361 of the Internal Revenue Code.
(f) Except as set forth in Section 5.7 of the SCB
Disclosure Memorandum, none of the SCB Companies is a party to any agreement,
contract, arrangement or plan that has resulted or would result, separately or
in the aggregate, in the payment of any "excess parachute payment" within the
meaning of Section 280G of the Internal Revenue Code as a result of the
transactions contemplated by this Agreement.
5.8 Compliance With Laws. SCB is duly registered as a bank holding
company under the BHC Act. Each SCB Company has in effect all Permits necessary
for it to own, lease, or operate its material Assets and to carry on its
business as now conducted, except for those Permits the absence of which are not
reasonably likely to have, individually or in the aggregate, a Material Adverse
Effect on SCB. None of the SCB Companies is presently in Default under or in
violation of any such Permit, other than Defaults which are not reasonably
likely to have, individually or in the aggregate, a Material Adverse Effect on
SCB. Except as set forth in Section 5.8 of the SCB Disclosure Memorandum, no SCB
Company:
(i) is in violation of any Laws, Orders, or
Permits applicable to its business or employees conducting its business, except
for violations which are not reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect on SCB; or
(ii) has received any notification or
communication from any agency or department of federal, state, or local
government or any Regulatory Authority or the staff thereof (i) asserting that
any SCB Company is not in compliance with any of the Laws or Orders which such
governmental authority or Regulatory Authority enforces, where such
noncompliance is reasonably likely to have, individually or in the aggregate, a
Material Adverse Effect on SCB, (ii) threatening to revoke any Permits, the
revocation of which is reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect on SCB, or (iii) requiring any SCB Company
to enter into or consent to the issuance of a cease and desist order, formal
agreement, directive, commitment, or memorandum of understanding, or to adopt
any board resolution or similar undertaking, which restricts materially the
conduct of its business, or in any manner relates to its capital adequacy, its
credit or reserve policies, its management or the payment of dividends.
5.9 Assets. Except as disclosed in Section 5.9 of the SCB
Disclosure Memorandum, the SCB Companies have good and marketable title, free
and clear of all Liens (except for those Liens which are not likely to have a
Material Adverse Effect on SCB or its Subsidiaries taken as a whole), to all of
their respective Assets. All Assets which are material to SCB's business on a
consolidated basis, held under leases or subleases by any of the SCB Companies,
are held under valid Contracts enforceable in accordance with their respective
terms (except as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium, or other Laws affecting the enforcement
of creditors' rights generally and except that the availability of the equitable
remedy of specific performance or injunctive
9
relief is subject to the discretion of the court before which any proceedings
may be brought), and each such Contract is in full force and effect. The SCB
Companies currently maintain insurance in amounts, scope, and coverage as
disclosed in Section 5.9 of the SCB Disclosure Memorandum. None of the SCB
Companies has received written notice from any insurance carrier that (i) such
insurance will be canceled or that coverage thereunder will be reduced or
eliminated, or (ii) premium costs with respect to such policies of insurance
will be substantially increased. Except as disclosed in Section 5.9 of the SCB
Disclosure Memorandum, to the Knowledge of SCB there are presently no
occurrences giving rise to a claim under such policies of insurance and no
notices have been given by any SCB Company under such policies.
5.10 Legal Proceedings. There is no Litigation instituted or
pending, or, to the Knowledge of SCB, threatened against any SCB Company, or
against any Asset, employee benefit plan, interest, or right of any of them,
that is reasonably likely to have, individually or in the aggregate, a Material
Adverse Effect on SCB, nor are there any Orders of any Regulatory Authorities,
other governmental authorities, or arbitrators outstanding against any SCB
Company.
5.11 Reports. Since January 1, 2000, or the date of organization if
later, each SCB Company has filed all reports and statements, together with any
amendments required to be made with respect thereto, that it was required to
file with Regulatory Authorities (except, in the case of state securities
authorities, failures to file which are not reasonably likely to have,
individually or in the aggregate, a Material Adverse Effect on SCB). As of its
respective date, each such report and document, including the financial
statements, exhibits, and schedules thereto, (i) complied in all material
respects with all applicable Laws, and (ii) did not, in all material respects,
contain any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements made therein,
in light of the circumstances under which they were made, not misleading.
5.12 Statements True and Correct. None of the information supplied
or to be supplied in writing by any SCB Company or any Affiliate thereof for
inclusion in the Registration Statement, taken as a whole, will, when the
Registration Statement becomes effective, be false or misleading with respect to
any material fact, or omit to state any material fact necessary to make the
statements therein not misleading. None of the information supplied or to be
supplied by any SCB Company or any Affiliate thereof which is included in the
Joint Proxy Statement or any other documents to be filed by SCB or FLB with the
SEC or any other Regulatory Authority in connection with the transactions
contemplated hereby will, at the respective time such documents are filed, and
with respect to the Joint Proxy Statement, when first mailed to the shareholders
of FLB or SCB, be false or misleading with respect to any material fact, or omit
to state any material fact necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading, or, in the case of
the Joint Proxy Statement or any amendment thereof or supplement thereto, at the
time of the FLB Shareholders' Meeting or the SCB Shareholders' Meeting, be false
or misleading with respect to any material fact, or omit to state any material
fact necessary to correct any statement in any earlier communication with
respect to the solicitation of any proxy for the FLB Shareholders' Meeting or
the SCB Shareholders' Meeting. All documents that any SCB Company or any
Affiliate thereof is responsible for filing with any Regulatory Authority in
connection with the transactions contemplated hereby will comply as to form in
all material respects with the provisions of applicable Law.
5.13 Tax and Regulatory Matters. No SCB Company or any Affiliate
thereof has taken or agreed to take any action or has any Knowledge of any fact
or circumstance that is reasonably likely to (i) prevent the transactions
contemplated hereby, including the Merger, from qualifying as a reorganization
within the meaning of Section 368(a) of the Internal Revenue Code, or (ii)
materially impede or delay receipt of any Consents of Regulatory Authorities
referred to in Section 9.1(b) of this Agreement or result in the imposition of a
condition or restriction of the type referred to in the last sentence of such
Section.
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5.14 Environmental Matters.
(a) To the Knowledge of SCB, except as disclosed in
Section 5.14 of the SCB Disclosure Memorandum, each SCB Company, its
Participation Facilities, and its Loan Properties are, and have been, in
compliance with all Environmental Laws, except for violations which are not
reasonably likely to have, individually or in the aggregate, a Material Adverse
Effect on SCB.
(b) Except as disclosed in Section 5.14 of the SCB
Disclosure Memorandum, there is no Litigation pending, or, to the Knowledge of
SCB, threatened before any court, governmental agency, or authority or other
forum in which any SCB Company or any of its Loan Properties or Participation
Facilities (or any SCB Company in respect of any such Loan Property or
Participation Facility) has been or, with respect to threatened Litigation, may
be named as a defendant or potentially responsible party (i) for alleged
noncompliance (including by any predecessor) with any Environmental Law or (ii)
relating to the release into the environment of any Hazardous Material, whether
or not occurring at, on, under, or involving any of its Loan Properties or
Participation Facilities, except for such Litigation pending or threatened that
is not reasonably likely to have, individually or in the aggregate, a Material
Adverse Effect on SCB.
(c) To the Knowledge of SCB, except as disclosed in
Section 5.14 of the SCB Disclosure Memorandum, there is no reasonable basis for
any Litigation of a type described above in Section 5.14(b), except such as is
not reasonably likely to have, individually or in the aggregate, a Material
Adverse Effect on SCB.
(d) To the Knowledge of SCB, during the period of (i)
SCB's or any of its Subsidiaries' ownership or operation of any of their
respective properties, (ii) SCB's or any of its Subsidiaries' participation in
the management of any Participation Facility, or (iii) SCB's or any of its
Subsidiaries' holding a security interest in a Loan Property, there has been no
release of Hazardous Material in, on, under, or affecting any Participation
Facility or Loan Property of a SCB Company, except such as are not reasonably
likely to have, individually or in the aggregate, a Material Adverse Effect on
SCB.
5.15 Outstanding FLB Common Stock. As of the date of this
Agreement, the SCB Companies do not beneficially own any shares of FLB Common
Stock for their own accounts (not including those held in a fiduciary or trust
capacity for, or on behalf of, unaffiliated third parties). During the term of
this Agreement, no SCB Company shall purchase or otherwise acquire beneficial
ownership of any FLB Common Stock except pursuant to the terms of this
Agreement.
5.16 Material Contracts. Except as set forth in the SCB SEC Reports
or in Section 5.16 of the SCB Disclosure Memorandum, no SCB Company is a party
to or bound by any "material contract" as such term is defined in Item
601(b)(10) of Regulation S-K of the SEC (each such contract a "SCB Contract").
With respect to each SCB Contract and except as disclosed in Section 5.16 of the
SCB Disclosure Memorandum: (i) such SCB Contract is in full force and effect;
(ii) no SCB Company is in material Default thereunder; (iii) no SCB Company has
repudiated or waived any material provision of any such SCB Contract; and (iv)
no other party to any such Contract is, to the Knowledge of SCB, in Default in
any respect or has repudiated or waived any material provision thereunder.
5.17 Employee Benefit Plans.
(a) SCB has disclosed in Section 5.17 of the SCB
Disclosure Memorandum, and has delivered or made available to FLB prior to the
execution of this Agreement, copies in each case of: (i) all pension,
retirement, profit-sharing, deferred compensation, stock option, employee stock
ownership,
11
severance pay, vacation, bonus, or other incentive plan, all other written
employee programs, arrangements, or agreements, all medical, vision, dental, or
other health plans, all life insurance plans, and all other employee benefit
plans or fringe benefit plans, including, without limitation, "employee benefit
plans" (as that term is defined in Section 3(3) of ERISA), currently adopted,
maintained by, sponsored in whole or in part by, or contributed to by any SCB
Company or ERISA Affiliate (as defined below) thereof for the benefit of
employees, retirees, dependents, spouses, directors, independent contractors, or
other beneficiaries and under which employees, retirees, dependents, spouses,
directors, independent contractors, or other beneficiaries are eligible to
participate (collectively, the "SCB Benefit Plans"); (ii) all insurance
contracts, annuity contracts and other funding vehicles relating to the SCB
Benefit Plans; (iii) all material agreements entered into with service providers
in connection with the SCB Benefit Plans; and (iv) summary plan descriptions,
favorable Internal Revenue Service determination letters for each SCB ERISA Plan
intended to be qualified under Section 401(a) of the Internal Revenue Code and
the most recently available Form 5500 annual reports, certified financial
statement and actuarial reports for the SCB Benefit Plans. Any of the SCB
Benefit Plans which is an "employee pension benefit plan" (as that term is
defined in Section 3(2) of ERISA), is referred to herein as a "SCB ERISA Plan."
Each SCB ERISA Plan which is also a "defined benefit plan" (as defined in
Section 414(j) of the Internal Revenue Code and Section 3(35) of ERISA) is
referred to herein as a "SCB Pension Plan." No SCB Pension Plan is or has been a
multiemployer plan within the meaning of Section 3(37) of ERISA. No SCB Benefit
Plan is a multiple employer plan within the meaning of Section 413(c) of the
Internal Revenue Code or is a multiple employer welfare arrangement within the
meaning of Section 3(40) of ERISA. Since the date the foregoing documents were
delivered or made available to FLB, no amendments to any SCB Benefit Plan have
been made. Except as disclosed in Section 5.17 of the SCB Disclosure Memorandum,
SCB does not maintain any unwritten SCB Benefit Plans. No SCB Company nor any
ERISA Affiliate is a party to a collective bargaining agreement. SCB has
disclosed in Section 5.17 of the SCB Disclosure Memorandum a complete and
accurate list of (A) each ERISA Affiliate, and (B) each SCB ERISA Plan that has
not been adopted by each ERISA Affiliate that maintains a separate payroll.
(b) Except as disclosed in Section 5.17 of the SCB
Disclosure Memorandum, all SCB Benefit Plans are in compliance with the
applicable terms of ERISA, the Internal Revenue Code, COBRA (as defined below)
and any other applicable Laws the breach or violation of which are reasonably
likely to have, individually or in the aggregate, a Material Adverse Effect on
SCB, and each SCB ERISA Plan which is intended to be qualified under Section
401(a) of the Internal Revenue Code has received a favorable determination
letter (which may be a favorable determination issued to the sponsoring
organization of a master, prototype or volume submitter plan) from the Internal
Revenue Service, and SCB is not aware of any circumstances likely to result in
revocation of any such favorable determination letter. Except as disclosed in
Section 5.17 of the SCB Disclosure Memorandum, no SCB Company nor any ERISA
Affiliate has any liability to the Internal Revenue Service with respect to any
SCB Benefit Plan, including any liability imposed by Chapter 43 of the Internal
Revenue Code, and no SCB Company has engaged in a transaction with respect to
any SCB Benefit Plan that, assuming the taxable period of such transaction
expired as of the date hereof, would subject any SCB Company to a Tax imposed by
either Section 4975 of the Internal Revenue Code or Section 502(i) of ERISA in
amounts which are reasonably likely to have, individually or in the aggregate, a
Material Adverse Effect on SCB.
(c) Except as disclosed in Section 5.17 of the SCB
Disclosure Memorandum, no SCB Pension Plan has any "unfunded current liability"
(as that term is defined in Section 302(d)(8)(A) of ERISA) and the fair market
value of the assets of any such plan exceeds the plan's "benefit liabilities,"
as that term is defined in Section 4001(a)(16) of ERISA, when determined under
actuarial factors that would apply if the plan terminated in accordance with all
applicable legal requirements. Except as disclosed in Section 5.17 of the SCB
Disclosure Memorandum, since the date of the most recent actuarial valuation,
there has been (i) no material change in the financial position of any SCB
Pension Plan, (ii) no change in the actuarial assumptions with respect to any
SCB Pension Plan, and (iii) no increase in benefits under
12
any SCB Pension Plan as a result of plan amendments or changes in applicable Law
which is reasonably likely to have, individually or in the aggregate, a Material
Adverse Effect on SCB or materially adversely affect the funding status of any
such plan. Neither any SCB Pension Plan nor any "single- employer plan," within
the meaning of Section 4001(a)(15) of ERISA, currently or formerly maintained by
any SCB Company, or the single-employer plan of any entity which is considered
one employer with SCB under Section 4001 of ERISA or Section 414 of the Internal
Revenue Code or Section 302 of ERISA (whether or not waived) (an "ERISA
Affiliate") has an "accumulated funding deficiency" within the meaning of
Section 412 of the Internal Revenue Code or Section 302 of ERISA, which is
reasonably likely to have a Material Adverse Effect on SCB. No SCB Company has
provided, or is required to provide, security to a SCB Pension Plan or to any
single-employer plan of an ERISA Affiliate pursuant to Section 401(a)(29) of the
Internal Revenue Code.
(d) Within the six-year period preceding the Effective
Time, no liability under Subtitle C or D of Title IV of ERISA has been or is
expected to be incurred by any SCB Company with respect to any ongoing, frozen,
or terminated single-employer plan or the single-employer plan of any ERISA
Affiliate, which liability is reasonably likely to have a Material Adverse
Effect on SCB. No SCB Company has incurred any withdrawal liability with respect
to a multiemployer plan under Subtitle B of Title IV of ERISA (regardless of
whether based on contributions of an ERISA Affiliate), which liability is
reasonably likely to have a Material Adverse Effect on SCB. No notice of a
"reportable event," within the meaning of Section 4043 of ERISA for which the
30-day reporting requirement has not been waived, has been required to be filed
for any SCB Pension Plan or by any ERISA Affiliate within the 12-month period
ending on the date hereof. No SCB Company nor ERISA Affiliate has filed a notice
of intent to terminate any ERISA Pension Plan or has adopted any amendment to
treat such Plan as terminated. The Pension Benefit Guaranty Corporation has not
instituted proceedings to treat any ERISA Pension Plan as terminated. No event
has occurred or circumstance exists that may constitute grounds under Section
4042 of ERISA for the termination of, or appointment of a trustee to administer,
any SCB Pension Plan.
(e) Except as disclosed in Section 5.17 of the SCB
Disclosure Memorandum, no SCB Company has any liability for retiree health and
life benefits under any of the SCB Benefit Plans other than health continuation
coverage required by the Consolidated Omnibus Budget Reconciliation Act of 1985
as amended and Sections 601 through 608 of ERISA ("COBRA") or by any similar
state law, and there are no restrictions on the rights of such SCB Company to
amend or terminate any such plan without incurring any liability thereunder,
which liability is reasonably likely to have a Material Adverse Effect on SCB.
There is no pending or, to the Knowledge of SCB, threatened complaint, claim
(other than a routine claim for benefits submitted by participants or
beneficiaries), proceeding, audit or investigation of any kind in or before any
court, tribunal, or governmental agency with respect to any SCB Benefit Plan.
(f) Except as disclosed in Section 5.17 of the SCB
Disclosure Memorandum, neither the execution and delivery of this Agreement nor
the consummation of the transactions contemplated hereby will (i) result in any
payment (including severance, unemployment compensation, golden parachute, or
otherwise) becoming due to any director or any employee of any SCB Company from
any SCB Company under any SCB Benefit Plan or otherwise, (ii) increase any
benefits otherwise payable under any SCB Benefit Plan, or (iii) result in any
acceleration of the time of payment or vesting of any such benefit, where such
payment, increase, or acceleration is reasonably likely to have, individually or
in the aggregate, a Material Adverse Effect on SCB.
(g) The actuarial present values of all accrued deferred
compensation entitlements (including entitlements under any executive
compensation, supplemental retirement, or employment agreement) of employees and
former employees of any SCB Company and their respective beneficiaries, other
than entitlements accrued pursuant to funded retirement plans subject to the
provisions of Section
13
412 of the Internal Revenue Code or Section 302 of ERISA, have been fully
reflected on the SCB Financial Statements to the extent required by and in
accordance with GAAP.
(h) Except as disclosed in Section 5.17(h) of the SCB
Disclosure Memorandum, all contributions and payments made or accrued with
respect to all SCB Benefit Plans are deductible under Sections 404 or 162 of the
Internal Revenue Code and, if not made, are properly reflected on the financial
statements of the SCB Companies and ERISA Affiliates. No event has occurred or
circumstance exists that could result in an increase in premium costs of insured
or self-insured SCB Benefit Plans that would have a Material Adverse Effect on
SCB. Levels of insurance reserves, trust funding and accrued liabilities with
respect to all ERISA Benefit Plans (to which such reserves or liabilities do or
should apply) are reasonable and sufficient to provide for all incurred but
unreported claims and any retroactive or prospective premium adjustments.
5.18 State Takeover Laws. SCB has taken all action required to be
taken by it in order to exempt this Agreement and the transactions contemplated
hereby and thereby from, and this Agreement and the transactions contemplated
hereby and thereby are exempt from the requirements of any "moratorium,"
"control share," "fair price" or other anti-takeover Laws of the State of
Florida.
5.19 Opinion of Financial Advisor. SCB has received the written
opinion of SunTrust Xxxxxxxx Xxxxxxxx, a division of SunTrust Capital Markets,
Inc., its financial advisor, to the effect that, as of the date hereof, the
consideration to be received by the SCB shareholders, based upon and subject to
the limitations set forth in such opinion, is fair to the SCB shareholders from
a financial point of view.
ARTICLE 6
REPRESENTATIONS AND WARRANTIES OF FLB
FLB hereby represents and warrants to SCB as follows:
6.1 Organization, Standing, and Power. FLB is a corporation duly
organized, validly existing, and its status is active under the laws of the
State of Florida, and has the corporate power and authority to carry on its
business as now conducted and to own, lease and operate its material Assets. FLB
is duly qualified or licensed to transact business as a foreign corporation and
is in good standing in each jurisdiction where the character of its Assets or
the nature or conduct of its business requires it to be so qualified or
licensed, except for such jurisdictions in which the failure to be so qualified
or licensed is not reasonably likely to have, individually or in the aggregate,
a Material Adverse Effect on FLB.
6.2 Authority; No Breach By Agreement.
(a) FLB has the corporate power and authority necessary
to execute and deliver this Agreement and, subject to the approval and adoption
of this Agreement by the shareholders of FLB and to such Consents of Regulatory
Authorities as required under applicable Law, to perform its obligations under
this Agreement and consummate the transactions contemplated hereby. The
execution, delivery, and performance of this Agreement by FLB and the
consummation by FLB of the transactions contemplated herein, including the
Merger, have been duly and validly authorized by all necessary corporate action
in respect thereof on the part of FLB, subject to the approval of this Agreement
by its shareholders as contemplated by Section 8.1 of this Agreement. Subject to
such requisite shareholder approval (and assuming due authorization, execution
and delivery by SCB) and to such Consents of
14
Regulatory Authorities as required by applicable law, this Agreement represents
a legal, valid, and binding obligation of FLB, enforceable against FLB in
accordance with its terms (except in all cases as such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar Laws affecting the enforcement of creditors' rights generally and except
that the availability of the equitable remedy of specific performance or
injunctive relief is subject to the discretion of the court before which any
proceeding may be brought).
(b) Neither the execution and delivery of this Agreement
by FLB, nor the consummation by FLB of the transactions contemplated hereby, nor
compliance by FLB with any of the provisions hereof, will (i) conflict with or
result in a breach of any provision of FLB's Articles of Incorporation or
Bylaws, or, (ii) constitute or result in a Default under, or require any Consent
pursuant to, or result in the creation of any Lien on any Asset of any FLB
Company under, any Contract or Permit of any FLB Company, where such Default or
Lien, or any failure to obtain such Consent, is reasonably likely to have,
individually or in the aggregate, a Material Adverse Effect on FLB, or, (iii)
subject to receipt of the requisite Consents referred to in Section 9.1(a), (b)
and (c) of this Agreement, violate any Order or any Law applicable to any FLB
Company or any of their respective material Assets which will have a Material
Adverse Effect on FLB.
(c) Other than in connection or compliance with the
provisions of the Securities Laws, applicable state corporate and securities
Laws, and rules of the NYSE, and other than Consents required from Regulatory
Authorities, and other than notices to or filings with the Internal Revenue
Service or the Pension Benefit Guaranty Corporation with respect to any employee
benefit plans, or under the HSR Act, and other than Consents, filings, or
notifications which, if not obtained or made, are not reasonably likely to have,
individually or in the aggregate, a Material Adverse Effect on FLB, no notice
to, filing with, or Consent of, any public body or authority is necessary for
the consummation by FLB of the Merger and the other transactions contemplated in
this Agreement.
6.3 Capital Stock.
(a) The authorized capital stock of FLB consists of (i)
500,000,000 shares of FLB Common Stock, of which 46,293,993 shares were issued
and outstanding as of the date of this Agreement and (ii) 20,000,000 shares of
FLB Preferred Stock, of which no shares were issued and outstanding as of the
date of this Agreement ("FLB Capital Stock"). All of the issued and outstanding
shares of FLB Capital Stock are, and all of the FLB Common Stock to be issued in
exchange for SCB Common Stock upon consummation of the Merger will be authorized
and reserved for issuance prior to the Effective Time and, when issued in
accordance with the terms of this Agreement, will be, duly and validly issued
and outstanding and fully paid and nonassessable under the FBCA. None of the
outstanding shares of FLB Capital Stock has been, and none of the shares of FLB
Common Stock to be issued in exchange for shares of FLB Common Stock upon
consummation of the Merger will be, issued in violation of any preemptive rights
of the current or past shareholders of FLB. None of the outstanding shares of
capital stock of FLB has been issued in violation of any preemptive rights. FLB
has reserved 5,930,784 shares of FLB Common Stock for issuance under the FLB
Stock Plans, pursuant to which, as of the date of this Agreement, options and
warrants to purchase not more than 4,432,000 shares of FLB Common Stock are
outstanding.
(b) Except as set forth in Section 6.3(a) of this
Agreement, there are no shares of capital stock or other equity securities of
FLB outstanding and no outstanding Rights relating to the capital stock of FLB.
15
6.4 FLB Subsidiaries. The list of Subsidiaries of FLB filed by FLB
with its Annual Report on Form 10-K for the fiscal year ended December 31, 2003,
is a true and complete list of all of the FLB Subsidiaries as of the date of
this Agreement. Except as disclosed in Section 6.4 of the FLB Disclosure
Memorandum, FLB owns all of the issued and outstanding shares of capital stock
of each FLB Subsidiary. No equity securities of any FLB Subsidiary are or may
become required to be issued (other than to another FLB Company) by reason of
any Rights, and there are no Contracts by which any FLB Subsidiary is bound to
issue (other than to another FLB Company) additional shares of its capital stock
or Rights or by which any FLB Company is or may be bound to transfer any shares
of the capital stock of any FLB Subsidiary (other than to another FLB Company).
There are no Contracts relating to the rights of any FLB Company to vote or to
dispose of any shares of the capital stock of any FLB Subsidiary. All of the
shares of capital stock of each FLB Subsidiary held by a FLB Company are fully
paid and nonassessable under the applicable corporation Law of the jurisdiction
in which such Subsidiary is incorporated or organized (except, in the case of
Subsidiaries that are national banks, for the assessment contemplated by 12
U.S.C. Section 55), and are owned by the FLB Company free and clear of any Lien.
Each FLB Subsidiary is duly organized, validly existing, and (as to
corporations) in good standing under the Laws of the jurisdiction in which it is
incorporated or organized, and has the corporate power and authority necessary
for it to own, lease, and operate its Assets and to carry on its business as now
conducted. Each FLB Subsidiary is duly qualified or licensed to transact
business as a foreign corporation and is in good standing in each jurisdiction
where the character of its Assets or the nature or conduct of its business
requires it to be so qualified or licensed, except for such jurisdictions in
which the failure to be so qualified or licensed is not reasonably likely to
have, individually or in the aggregate, a Material Adverse Effect on FLB. Each
FLB Subsidiary that is a depository institution is an "insured institution" as
defined in the Federal Deposit Insurance Act and applicable regulations
thereunder.
6.5 SEC Filings; Financial Statements.
(a) FLB has filed and made available to SCB accurate and
complete copies of all SEC Documents required to be filed by FLB with the SEC
since its organization (collectively, the "FLB SEC Reports"). The FLB SEC
Reports (i) at the time filed, complied in all material respects with the
applicable requirements of the 1933 Act and the 1934 Act, as the case may be,
and (ii) did not at the time they were filed (or if amended or superseded by a
filing prior to the date of this Agreement, then on the date of such filing)
contain any untrue statement of a material fact or omit to state a material fact
required to be stated in such FLB SEC Reports or necessary in order to make the
statements in such FLB SEC Reports, in light of the circumstances under which
they were made, not misleading. Except for FLB Subsidiaries that are registered
as brokers, dealers, investment advisers, or associated persons thereof, none of
the FLB Subsidiaries is required to file any forms, reports or other documents
with the SEC.
(b) Each of the FLB Financial Statements (including, in
each case, any related notes) contained in the FLB SEC Reports, complied, and
each SEC Document filed by FLB after the date of this Agreement until the
Effective Time will comply, as to form in all material respects with the
applicable published rules and regulations of the SEC with respect thereto, was
or will be prepared in accordance with GAAP applied on a consistent basis
throughout the periods involved (except as may be indicated in the notes to such
financial statements or, in the case of unaudited statements, as permitted by
Form 10-Q of the SEC), and fairly presented the consolidated financial position
of FLB and its Subsidiaries at the respective dates and the consolidated results
of its operations and cash flows for the periods indicated, except that the
unaudited interim financial statements were or are subject to normal and
recurring adjustments which were not or are not expected to be material in
amount.
6.6 Absence of Certain Changes or Events. Since the date of the
most recent balance sheet of FLB contained in the Form 10-K or Form 10-Q most
recently filed by FLB, there have been no events,
16
changes, or occurrences which have had, or are reasonably likely to have,
individually or in the aggregate, a Material Adverse Effect on FLB.
6.7 Tax Matters.
(a) All Tax Returns required to be filed by or on behalf
of any of the FLB Companies have been timely filed or requests for extensions
have been timely filed, granted, and have not expired for periods ended on or
before December 31, 2002, and on or before the date of the most recent fiscal
year end immediately preceding the Effective Time, except to the extent that all
such failures to file, taken together, are not reasonably likely to have a
Material Adverse Effect on FLB, and all Tax Returns filed are complete and
accurate in all material respects. All Taxes shown on filed Tax Returns have
been paid. There is no audit examination, deficiency, or refund Litigation with
respect to any Taxes that is reasonably likely to result in a determination that
would have, individually or in the aggregate, a Material Adverse Effect on FLB,
except as reserved against in the FLB Financial Statements delivered prior to
the date of this Agreement. All Taxes and other liabilities due with respect to
completed and settled examinations or concluded Litigation have been paid.
(b) Adequate provision for any Taxes due or, to the
knowledge of FLB, to become due for any of the FLB Companies for the period or
periods through and including the date of the respective FLB Financial
Statements has been made and is reflected on such FLB Financial Statements.
(c) Deferred Taxes of the FLB Companies have been
adequately provided for in the FLB Financial Statements.
(d) Each of the FLB Companies is in compliance with, and
its records contain all information and documents (including properly completed
Internal Revenue Service Forms W-9) necessary to comply with, all applicable
information reporting and Tax withholding requirements under federal, state and
local Tax Laws, and such records identify with specificity all accounts subject
to backup withholding under Section 3406 of the Internal Revenue Code, except
for such instances of noncompliance and such omissions as are not reasonably
likely to have, individually or in the aggregate, a Material Adverse Effect on
FLB.
(e) F.N.B. Corporation ("FNB") has received a ruling
dated December 11, 2003 (the "Ruling") from the Internal Revenue Service (the
"IRS"), to the effect that the Distribution (as defined below) qualifies as a
tax-free spin-off for federal income tax purposes under Section 355 of the Code.
The factual assumptions and representations made by FNB and FLB to the IRS in
connection with the Ruling were valid, accurate, true, correct and complete at
the time made and, to the Knowledge of FLB, are valid, accurate, true, correct
and complete as of the date hereof; and all facts and representations which
would have been material to the IRS in issuing the Ruling were submitted by FNB
and FLB to the IRS. FNB and FLB have properly reported to, and filed all
necessary documents with, the IRS to properly treat the Distribution as a
tax-free spin-off for federal income tax purposes under Section 355 of the Code,
and have not filed or recorded any documents inconsistent with such treatment.
For purposes of this Section, "Distribution" means the distribution of the
shares of FLB Common Stock made on January 1, 2004 by FNB to its shareholders of
record of December 26, 2003.
6.8 Compliance With Laws. FLB is duly registered as a financial
holding company under the BHC Act. Each FLB Company has in effect all Permits
necessary for it to own, lease, or operate its material Assets and to carry on
its business as now conducted, except for those Permits the absence of which are
not reasonably likely to have, individually or in the aggregate, a Material
Adverse Effect on FLB. None of the FLB Companies is presently in Default under
or in violation of any such Permit, other
17
than Defaults which are not reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect on FLB. No FLB Company:
(i) is in violation of any Laws, Orders, or
Permits applicable to its business or employees conducting its business, except
for violations which are not reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect on FLB; or
(ii) has received any notification or
communication from any agency or department of federal, state, or local
government or any Regulatory Authority or the staff thereof (i) asserting that
any FLB Company is not in compliance with any of the Laws or Orders which such
governmental authority or Regulatory Authority enforces, where such
noncompliance is reasonably likely to have, individually or in the aggregate, a
Material Adverse Effect on FLB, (ii) threatening to revoke any Permits, the
revocation of which is reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect on FLB, or (iii) requiring any FLB Company
to enter into or consent to the issuance of a cease and desist order, formal
agreement, directive, commitment, or memorandum of understanding, or to adopt
any board resolution or similar undertaking, which restricts materially the
conduct of its business, or in any manner relates to its capital adequacy, its
credit or reserve policies, its management or the payment of dividends.
6.9 Assets. Except as disclosed in Section 6.9 of the FLB
Disclosure Memorandum, the FLB Companies have good and marketable title, free
and clear of all Liens (except for those Liens which are not likely to have a
Material Adverse Effect on FLB or its Subsidiaries taken as a whole), to all of
their respective Assets. All Assets which are material to FLB's business on a
consolidated basis, held under leases or subleases by any of the FLB Companies,
are held under valid Contracts enforceable in accordance with their respective
terms (except as enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium, or other Laws affecting the enforcement
of creditors' rights generally and except that the availability of the equitable
remedy of specific performance or injunctive relief is subject to the discretion
of the court before which any proceedings may be brought), and each such
Contract is in full force and effect. The FLB Companies currently maintain
insurance in amounts, scope, and coverage as disclosed in Section 6.9 of the FLB
Disclosure Memorandum. None of the FLB Companies has received written notice
from any insurance carrier that (i) such insurance will be canceled or that
coverage thereunder will be reduced or eliminated, or (ii) premium costs with
respect to such policies of insurance will be substantially increased. Except as
disclosed in Section 6.9 of the FLB Disclosure Memorandum, to the Knowledge of
FLB there are presently no occurrences giving rise to a claim under such
policies of insurance and no notices have been given by any FLB Company under
such policies.
6.10 Legal Proceedings. Except as disclosed in Section 6.10 of the
FLB Disclosure Memorandum, there is no Litigation instituted or pending, or, to
the Knowledge of FLB, threatened (or unasserted but considered probable of
assertion and which if asserted would have at least a reasonable probability of
an unfavorable outcome) against any FLB Company, or against any Asset, employee
benefit plan, interest, or right of any of them, that is reasonably likely to
have, individually or in the aggregate, a Material Adverse Effect on FLB, nor
are there any Orders of any Regulatory Authorities, other governmental
authorities, or arbitrators outstanding against any FLB Company.
6.11 Reports. Since January 1, 2000, or the date of organization if
later, each FLB Company has filed all reports and statements, together with any
amendments required to be made with respect thereto, that it was required to
file with Regulatory Authorities (except, in the case of state securities
authorities, failures to file which are not reasonably likely to have,
individually or in the aggregate, a Material Adverse Effect on FLB). As of its
respective date, each such report and document, including the financial
statements, exhibits, and schedules thereto, (i) complied in all material
respects with all
18
applicable Laws, and (ii) did not, in all material respects, contain any untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements made therein, in light of the
circumstances under which they were made, not misleading.
6.12 Statements True and Correct. None of the information supplied
or to be supplied by any FLB Company or any Affiliate thereof for inclusion in
the Registration Statement, taken as a whole, will, when the Registration
Statement becomes effective, be false or misleading with respect to any material
fact, or omit to state any material fact necessary to make the statements
therein not misleading. None of the information supplied or to be supplied by
any FLB Company or any Affiliate thereof which is included in the Joint Proxy
Statement or any other documents to be filed by FLB or SCB with the SEC or any
other Regulatory Authority in connection with the transactions contemplated
hereby will, at the respective time such documents are filed, and with respect
to the Joint Proxy Statement, when first mailed to the shareholders of FLB or
SCB, be false or misleading with respect to any material fact, or omit to state
any material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, or, in the case of the
Joint Proxy Statement or any amendment thereof or supplement thereto, at the
time of the FLB Shareholders' Meeting or the SCB Shareholders' Meeting, be false
or misleading with respect to any material fact, or omit to state any material
fact necessary to correct any statement in any earlier communication with
respect to the solicitation of any proxy for the FLB Shareholders' Meeting or
the SCB Shareholders' Meeting. All documents that any FLB Company or any
Affiliate thereof is responsible for filing with any Regulatory Authority in
connection with the transactions contemplated hereby will comply as to form in
all material respects with the provisions of applicable Law.
6.13 Tax and Regulatory Matters. No FLB Company or any Affiliate
thereof has taken or agreed to take any action or has any Knowledge of any fact
or circumstance that is reasonably likely to (i) prevent the transactions
contemplated hereby, including the Merger, from qualifying as a reorganization
within the meaning of Section 368(a) of the Internal Revenue Code, or (ii)
materially impede or delay receipt of any Consents of Regulatory Authorities
referred to in Section 9.1(b) of this Agreement or result in the imposition of a
condition or restriction of the type referred to in the last sentence of such
Section.
6.14 Environmental Matters.
(a) To the Knowledge of FLB, except as disclosed in
Section 6.14 of the FLB Disclosure Memorandum, each FLB Company, its
Participation Facilities, and its Loan Properties are, and have been, in
compliance with all Environmental Laws, except for violations which are not
reasonably likely to have, individually or in the aggregate, a Material Adverse
Effect on FLB.
(b) Except as disclosed in Section 6.14 of the FLB
Disclosure Memorandum, there is no Litigation pending, or, to the Knowledge of
FLB, threatened before any court, governmental agency, or authority or other
forum in which any FLB Company or any of its Loan Properties or Participation
Facilities (or any FLB Company in respect of any such Loan Property or
Participation Facility) has been or, with respect to threatened Litigation, may
be named as a defendant or potentially responsible party (i) for alleged
noncompliance (including by any predecessor) with any Environmental Law or (ii)
relating to the release into the environment of any Hazardous Material, whether
or not occurring at, on, under, or involving any of its Loan Properties or
Participation Facilities, except for such Litigation pending or threatened that
is not reasonably likely to have, individually or in the aggregate, a Material
Adverse Effect on FLB.
(c) To the Knowledge of FLB, there is no reasonable basis
for any Litigation of a type described above in Section 6.14(b), except such as
is not reasonably likely to have, individually or in the aggregate, a Material
Adverse Effect on FLB.
19
(d) To the Knowledge of FLB, except as disclosed in
Section 6.14 of the FLB Disclosure Memorandum, during the period of (i) FLB's or
any of its Subsidiaries' ownership or operation of any of their respective
properties, (ii) FLB's or any of its Subsidiaries' participation in the
management of any Participation Facility, or (iii) FLB's or any of its
Subsidiaries' holding a security interest in a Loan Property, there have been no
releases of Hazardous Material in, on, under, or affecting any Participation
Facility or Loan Property of a FLB Company, except such as are not reasonably
likely to have, individually or in the aggregate, a Material Adverse Effect on
FLB.
6.15 Outstanding SCB Common Stock. As of the date of this
Agreement, FLB Companies do not beneficially own any shares of SCB Common Stock
for their own accounts (not including those held in a fiduciary or trust
capacity for, or on behalf of, unaffiliated third parties). During the term of
this Agreement, no FLB Company shall purchase or otherwise acquire beneficial
ownership of any shares of SCB Common Stock except pursuant to the terms of this
Agreement.
6.16 Material Contracts. Except as set forth in the FLB SEC
Reports, no FLB Company is a party to or bound by any "material contract" as
such term is defined in Item 601(b)(10) of Regulation S-K of the SEC (each such
contract a "FLB Contract"). With respect to each FLB Contract (i) such FLB
Contract is in full force and effect; (ii) no FLB Company is in Default
thereunder; (iii) no FLB Company has repudiated or waived any material provision
of any such FLB Contract; and (iv) no other party to any such FLB Contract is,
to the Knowledge of FLB, in Default in any respect or has repudiated or waived
any material provision thereunder.
6.17 Employee Benefit Plans.
(a) FLB has disclosed in Section 6.17 of the FLB
Disclosure Memorandum, and has delivered or made available to SCB prior to the
execution of this Agreement copies or summaries in each case of, all material
pension, retirement, profit-sharing, deferred compensation, stock option,
employee stock ownership, severance pay, vacation, bonus, or other incentive
plan, all other written employee programs, arrangements, or agreements, all
medical, vision, dental, or other health plans, all life insurance plans, and
all other employee benefit plans or fringe benefit plans, including "employee
benefit plans" (as that term is defined in Section 3(3) of ERISA), currently
adopted, maintained by, sponsored in whole or in part by, or contributed to by
FLB or any of its Subsidiaries for the benefit of employees, retirees,
dependents, spouses, directors, independent contractors, or other beneficiaries
and under which employees, retirees, dependents, spouses, directors, independent
contractors, or other beneficiaries are eligible to participate (collectively,
the "FLB Benefit Plans"). Any of the FLB Benefit Plans which is an "employee
pension benefit plan" (as that term is defined in Section 3(2) of ERISA) is
referred to herein as a "FLB ERISA Plan." No FLB Benefit Plan is or has been a
multi-employer plan within the meaning of Section 3(37) of ERISA. No FLB Benefit
Plan is a multiple employer plan within the meaning of Section 413(c) of the
Internal Revenue Code or is a multiple employer welfare arrangement within the
meaning of Section 3(40) of ERISA. Since the date the foregoing documents were
delivered or made available to SCB, no amendments to any FLB Benefit Plan have
been made. Except as disclosed in Section 6.17 of the FLB Disclosure Memorandum,
FLB does not maintain any unwritten FLB Benefit Plans. No FLB Company nor any
ERISA Affiliate is a party to a collective bargaining agreement. FLB has
disclosed in Section 6.17 of the FLB Disclosure Memorandum a complete and
accurate list of (A) each ERISA Affiliate, and (B) each FLB ERISA Plan that has
not been adopted by each ERISA Affiliate that maintains a separate payroll.
(b) Except as disclosed in the FLB Disclosure Memorandum,
all FLB Benefit Plans are in compliance in all material respects with the
applicable terms of ERISA, the Internal Revenue Code, and any other applicable
Laws, the breach or violation of which are reasonably likely to have,
individually or in the aggregate, a Material Adverse Effect on FLB and each FLB
ERISA Plan which is
20
intended to be qualified under Section 401(a) of the Internal Revenue Code has
received a favorable determination letter (which may be a favorable
determination issued to the sponsoring organization of a master, prototype or
volume submitter plan) from the Internal Revenue Service, and FLB is not aware
of any circumstances likely to result in revocation of any such favorable
determination letter. Except as disclosed in Section 6.17 of the FLB Disclosure
Memorandum, no FLB Company nor any ERISA Affiliate has any liability to the
Internal Revenue Service with respect to any FLB Benefit Plan, including any
liability imposed by Chapter 43 of the Internal Revenue Code, and no FLB Company
has engaged in a transaction with respect to any FLB Benefit Plan that, assuming
the taxable period of such transaction expired as of the date hereof, would
subject any FLB Company to a Tax imposed by either Section 4975 of the Internal
Revenue Code or Section 502(i) of ERISA in amounts which are reasonably likely
to have, individually or in the aggregate, a Material Adverse Effect on FLB.
(c) Except as disclosed in Section 6.17 of the FLB
Disclosure Memorandum, no FLB ERISA Plan which is a "defined benefit pension
plan" subject to Title IV of ERISA has any "unfunded current liability" (as that
term is defined in Section 302(d)(8)(A) of ERISA) and the present fair market
value of the assets of any such plan exceeds the plan's "benefit liabilities"
(as that term is defined in Section 4001(a)(16) of ERISA) when determined under
actuarial factors that would apply if the plan terminated in accordance with all
applicable legal requirements. Except as disclosed in Section 6.17 of the FLB
Disclosure Memorandum, since the date of the most recent actuarial valuation,
there has been (i) no material change in the financial position of any FLB
Pension Plan, (ii) no change in the actuarial assumptions with respect to any
FLB Pension Plan, and (iii) no increase in benefits under any FLB Pension Plan
as a result of plan amendments or changes in applicable Law which is reasonably
likely to have, individually or in the aggregate, a Material Adverse Effect on
FLB or materially adversely affect the funding status of any such plan. Neither
any FLB Pension Plan nor any "single- employer plan," within the meaning of
Section 4001(a)(15) of ERISA, currently or formerly maintained by any FLB
Company, or the single-employer plan of any entity which is considered one
employer with FLB under Section 4001 of ERISA or Section 414 of the Internal
Revenue Code or Section 302 of ERISA (whether or not waived) (an "ERISA
Affiliate") has an "accumulated funding deficiency" within the meaning of
Section 412 of the Internal Revenue Code or Section 302 of ERISA, which is
reasonably likely to have a Material Adverse Effect on FLB. No FLB Company has
provided, or is required to provide, security to a FLB Pension Plan or to any
single-employer plan of an ERISA Affiliate pursuant to Section 401(a)(29) of the
Internal Revenue Code.
(d) Within the six-year period preceding the Effective
Time, no liability under Subtitle C or D of Title IV of ERISA has been or is
expected to be incurred by any FLB Company with respect to any ongoing, frozen,
or terminated single-employer plan or the single-employer plan of any ERISA
Affiliate, which liability is reasonably likely to have a Material Adverse
Effect on FLB. No FLB Company has incurred any withdrawal liability with respect
to a multiemployer plan under Subtitle B of Title IV of ERISA (regardless of
whether based on contributions of an ERISA Affiliate), which liability is
reasonably likely to have a Material Adverse Effect on FLB. No notice of a
"reportable event," within the meaning of Section 4043 of ERISA for which the
30-day reporting requirement has not been waived, has been required to be filed
for any FLB Pension Plan or by any ERISA Affiliate within the 12-month period
ending on the date hereof. No FLB Company nor ERISA Affiliate has filed a notice
of intent to terminate any ERISA Pension Plan or has adopted any amendment to
treat such Plan as terminated. The Pension Benefit Guaranty Corporation has not
instituted proceedings to treat any ERISA Pension Plan as terminated. No event
has occurred or circumstance exists that may constitute grounds under Section
4042 of ERISA for the termination of, or appointment of a trustee to administer,
any FLB Pension Plan.
(e) Except as disclosed in Section 6.17 of the FLB
Disclosure Memorandum or otherwise provided by this Agreement, neither the
execution and delivery of this Agreement nor the consummation of the
transactions contemplated hereby will (i) result in any payment (including,
without
21
limitation, severance, unemployment compensation, golden parachute, or
otherwise) becoming due to any director or any employee of FLB or any of its
Subsidiaries from FLB or any of its Subsidiaries under any FLB Benefit Plan or
otherwise, (ii) increase any benefits otherwise payable under any FLB Benefit
Plan or (iii) result in any acceleration of the time of payment or vesting of
any such benefits, where such payment, increase, or acceleration is reasonably
likely to have, individually or in the aggregate, a Material Adverse Effect on
FLB.
(f) Except as disclosed in Section 6.17 of the FLB
Disclosure Memorandum, no FLB Company has any liability for retiree health and
life benefits under any of the FLB Benefit Plans other than health continuation
coverage required by the Consolidated Omnibus Budget Reconciliation Act of 1985
as amended and Sections 601 through 608 of ERISA ("COBRA") or by any similar
state law, and there are no restrictions on the rights of such FLB Company to
amend or terminate any such plan without incurring any liability thereunder,
which liability is reasonably likely to have a Material Adverse Effect on FLB.
There is no pending or, to the Knowledge of FLB, threatened complaint, claim
(other than a routine claim for benefits submitted by participants or
beneficiaries), proceeding, audit or investigation of any kind in or before any
court, tribunal, or governmental agency with respect to any FLB Benefit Plan.
(g) The actuarial present values of all accrued deferred
compensation entitlements (including entitlements under any executive
compensation, supplemental retirement, or employment agreement) of employees and
former employees of any FLB Company and their respective beneficiaries, other
than entitlements accrued pursuant to funded retirement plans subject to the
provisions of Section 412 of the Internal Revenue Code or Section 302 of ERISA,
have been fully reflected on the FLB Financial Statements to the extent required
by and in accordance with GAAP.
(h) Except as disclosed in Section 6.17(h) of the FLB
Disclosure Memorandum, all contributions and payments made or accrued with
respect to all FLB Benefit Plans are deductible under Sections 404 or 162 of the
Internal Revenue Code and, if not made, are properly reflected on the financial
statements of the FLB Companies and ERISA Affiliates. No event has occurred or
circumstance exists that could result in an increase in premium costs of insured
or self-insured FLB Benefit Plans that would have a Material Adverse Effect on
FLB. Levels of insurance reserves, trust funding and accrued liabilities with
respect to all ERISA Benefit Plans (to which such reserves or liabilities do or
should apply) are reasonable and sufficient to provide for all incurred but
unreported claims and any retroactive or prospective premium adjustments.
ARTICLE 7
CONDUCT OF BUSINESS PENDING CONSUMMATION
7.1 Mutual Covenants. From the date of this Agreement until the
earlier of the Effective Time or the termination of this Agreement, except as
expressly contemplated or permitted by this Agreement (including the provisions
of Section 8.9 of this Agreement, (i) without the prior written consent of SCB
(which consent shall not be unreasonably withheld or delayed), FLB will not, and
will cause each of its Subsidiaries not to, and (ii) without the prior written
consent of FLB (which consent shall not be unreasonably withheld or delayed),
SCB will not, and will cause each of its Subsidiaries not to:
(a) take any action that would (i) adversely affect the
ability of any Party to obtain any necessary approvals of any Regulatory
Authorities required for the transactions contemplated hereby or (ii) adversely
affect its ability to perform any of its material obligations under this
Agreement; or
22
(b) except as set forth on Section 7.1(b) of such Party's
Disclosure Memorandum, enter into or amend (except as may be required by
applicable law, to satisfy contractual obligations existing as of the date
hereof or amendments which, either individually or in the aggregate, would not
reasonably be expected to result in a material liability to FLB, SCB or their
respective Subsidiaries) any pension, retirement, stock option, stock purchase,
savings, profit sharing, deferred compensation, consulting, bonus, group
insurance or other employee benefit, incentive or welfare contract, plan or
arrangement, or any trust agreement related thereto, in respect of any of its
directors, officers or other employees, including, without limitation, taking
any action that accelerates the vesting or exercise of any benefits payable
thereunder; or
(c) amend its Articles of Incorporation or Bylaws, other
than an amendment to SCB's Articles of Incorporation to increase its authorized
common stock from 10,000,000 shares to 12,000,000 shares; or
(d) implement or adopt any change in its accounting
principles, practices or methods, other than as may be required by GAAP; or
(e) (i) knowingly take any action that would, or would be
reasonably likely to, prevent or impede the Merger from qualifying as a
"reorganization" within the meaning of Section 368(a) of the Code; or (ii)
knowingly take any action that is intended or is reasonably likely to result in
(A) any of its representations and warranties set forth in this Agreement being
or becoming untrue in any material respect at any time prior to the Effective
Time, (B) any of the conditions to the Merger set forth in Article 9 not being
satisfied or (C) a material violation of any provision of this Agreement except,
in each case, as may be required by applicable law; or
(f) agree or commit to do anything prohibited by this
Section 7.1.
7.2 Covenants of SCB. From the date of this Agreement until the
earlier of the Effective Time or the termination of this Agreement, except as
expressly contemplated or permitted by this Agreement, SCB covenants and agrees
that it will not, and will cause each of its Subsidiaries not to, do any of the
following without the prior consent of FLB (which consent shall not be
unreasonably withheld or delayed):
(a) operate its business other than in the usual, regular
and ordinary course; or
(b) fail to use commercially reasonable efforts to
preserve intact its business organization and Assets and maintain its rights and
franchises; or
(c) fail to use commercially reasonable efforts to
maintain its current employee relationships; or
(d) make any unsecured loan or other extension of credit
to any Person if, immediately after making such loan or extension of credit,
such Person would be indebted to the SCB Companies, collectively, in an
aggregate amount in excess of $500,000 (provided, that SCB may exceed this limit
through a one-time unsecured loan or extension of credit to an existing borrower
in an amount not to exceed 10% of the amount of the original loan or extension
of credit to such borrower), or make any fully secured loan to any Person
(except for loans secured by a first mortgage on single family owner-occupied
real estate and except for any loan to any Person who has received from SCB a
commitment for a loan or extension of credit prior to the date of this
Agreement) if, immediately after making such loan, such Person would be indebted
to the SCB Companies, collectively, in an aggregate amount in excess of
$1,500,000 (provided, that SCB may exceed this limit through a one-time fully
secured loan to an existing borrower in an amount not to exceed $500,000) (in
either case FLB must object thereto, if at all, within two business days, and
the failure to provide a written
23
objection within two business days shall be deemed as the approval of FLB to
make such loan or extend such credit); or
(e) incur any additional debt obligation or other
obligation for borrowed money (other than indebtedness of a SCB Company to
another SCB Company) in excess of an aggregate of $500,000 (for the SCB
Companies on a consolidated basis) except: (i) up to $5,000,000 in borrowings
under SCB's line of credit with SunTrust Bank NA, upon not less than 24 hours
prior notice to FLB; (ii) up to $5,000,000 in additional borrowings by SCB, upon
not less than 24 hours prior notice to FLB, provided that the proceeds of such
borrowings are contributed by SCB to SCB's bank subsidiaries and, further
provided that SCB reasonably concludes that such borrowings are necessary in
order for such bank subsidiaries to be "well-capitalized" within the guidelines
of the FDIC; and (iii) other borrowings incurred in the ordinary course of the
business of SCB Subsidiaries consistent with past practices (it being understood
and agreed that the incurrence of indebtedness in the ordinary course of
business shall include, without limitation, creation of deposit liabilities,
purchases of federal funds, advances from the Federal Reserve Bank, and entry
into repurchase agreements fully secured by U.S. government or agency
securities, but shall not include advances from the Federal Home Loan Bank); or
(f) impose, or suffer the imposition, on any Asset of any
SCB Company of any Lien or permit any such Lien to exist (other than in
connection with deposits, repurchase agreements, bankers acceptances, "treasury
tax and loan" accounts established in the ordinary course of business, the
satisfaction of legal requirements in the exercise of trust powers, and Liens in
effect as of the date hereof that are disclosed in the SCB Disclosure
Memorandum); or
(g) repurchase, redeem, or otherwise acquire or exchange
(other than exchanges in the ordinary course under employee benefit plans),
directly or indirectly, any shares, or any securities convertible into any
shares, of the capital stock of SCB; or
(h) except as provided in Section 7.2(h)of the SCB
Disclosure Memorandum or this Agreement, or pursuant to the exercise of stock
options and commitments to make stock grants outstanding as of the date hereof
and pursuant to the terms thereof in existence on the date hereof, issue, sell,
pledge, encumber, authorize the issuance of, enter into any Contract to issue,
sell, pledge, encumber, or authorize the issuance of, or otherwise permit to
become outstanding, any additional shares of capital stock of any SCB Company,
or any stock appreciation rights, or any option, warrant, conversion, or other
right to acquire any such stock, or any security convertible into any such
stock; or
(i) adjust, split, combine, or reclassify any capital
stock of any SCB Company or issue or authorize the issuance of any other
securities in respect of or in substitution for shares of SCB Common Stock, or
sell, lease, mortgage, or otherwise dispose of or otherwise encumber (i) any
shares of capital stock of any SCB Subsidiary (unless any such shares of stock
are sold or otherwise transferred to another SCB Company) or (ii) any Asset
other than in the ordinary course of business for reasonable and adequate
consideration; or
(j) except for purchases of United States Treasury
securities or United States Government agency securities, which in either case
have maturities of five years or less, purchase any securities or make any
material investment, either by purchase of stock or securities, contributions to
capital, Asset transfers, or purchase of any Assets, in any Person other than a
wholly owned SCB Subsidiary, or otherwise acquire direct or indirect control
over any Person, other than in connection with (i) foreclosures in the ordinary
course of business, (ii) acquisitions of control by a depository institution
Subsidiary in its fiduciary capacity, (iii) the creation of new wholly owned
Subsidiaries organized to conduct or continue activities otherwise permitted by
this Agreement in which case FLB may object
24
thereto within two business days, and the failure to provide written objection
within two business days shall be deemed to be approval of FLB to make such
purchase or investment; or
(k) commence any Litigation other than in accordance with
past practice or settle any Litigation involving any liability of any SCB
Company for material money damages or restrictions upon the operations of any
SCB Company; or
(l) except in the ordinary course of business, modify,
amend, or terminate any material Contract other than renewals without material
adverse change of terms, or waive, release, compromise, or assign any material
rights or claims; or
(m) except as set forth in Section 7.2(m) of the SCB
Disclosure Memorandum and for transactions in the ordinary course of business
consistent with past practice, make any investment in excess of $150,000 either
by purchase of stock or securities, contributions to capital, property
transfers, or purchase of any property or assets of any other individual,
corporation or other entity other than a wholly owned Subsidiary thereof; or
(n) sell, transfer, mortgage, encumber or otherwise
dispose of any of its material properties or assets to any individual,
corporation or other entity other than a direct or indirect wholly owned
Subsidiary, or cancel, release or assign any indebtedness to any such Person or
any claims held by any such Person, except in the ordinary course of business
consistent with past practice or pursuant to contracts or agreements in force at
the date of this Agreement; or
(o) except as set forth on Section 7.1(o) of the SCB
Disclosure Memorandum, (i) enter into or amend any written employment, severance
or similar agreements or arrangements with any of its directors or executive
officers, (ii) enter into or amend any material written employment, severance or
similar agreements or arrangements with any of its officers or employees, or
(iii) grant any salary or wage increase or increase any employee benefit
(including incentive or bonus payments), except for (A) normal individual
increases in compensation to employees in the ordinary course of business
consistent with past practice or (B) other changes as are provided for herein or
as may be required by law or to satisfy contractual obligations existing as of
the date hereof or additional grants of awards to newly hired employees
consistent with past practice; or
(p) make, declare, or pay any dividend or make any other
distribution in respect of SCB's capital stock, except for (i) the acquisition
of SCB Common Stock in a fiduciary or trust capacity in the ordinary course of
business, (ii) regular and ordinary cash dividends on SCB Common Stock in an
amount per share not to exceed the per share amount of SCB's most recent cash
dividend as of the date of this Agreement, and (iii) dividends from wholly owned
Subsidiaries of SCB to SCB or to another wholly owned Subsidiary of SCB; or
(q) agree or commit to do anything prohibited by this
Section 7.2.
(r) Covenants of FLB. From the date of this Agreement
until the earlier of the Effective Time or the termination of this Agreement,
FLB covenants and agrees that it shall continue to conduct its business and the
business of FLB Subsidiaries in a manner designed in its reasonable judgment to
enhance the long-term value of the FLB Common Stock and the business prospects
of the FLB Companies; provided, that nothing in this Agreement shall prevent any
FLB Company from (i) discontinuing or disposing of any of its Assets or business
or (ii) acquiring all or any portion of the business of any other entity, if
such action is, in the judgment of FLB, desirable in the conduct of the business
of FLB and its Subsidiaries.
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7.3 Dividends. From the date of this Agreement through the
Effective Time, FLB shall not declare or pay any dividends other than quarterly
cash dividends not to exceed $0.08 per share.
7.4 Adverse Changes in Condition. Each Party agrees to give
written notice promptly to the other Party upon becoming aware of the occurrence
or impending occurrence of any event or circumstance relating to it or any of
its Subsidiaries which (i) is reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect on it or (ii) would cause or constitute a
material breach of any of its representations, warranties, or covenants
contained herein, and to use commercially reasonable efforts to prevent or
promptly to remedy the same.
7.5 Reports. Each Party and its respective Subsidiaries shall file
all reports required to be filed by each of them with Regulatory Authorities
between the date of this Agreement and the Effective Time and shall deliver to
the other Party copies of all such reports promptly after the same are filed. If
financial statements are contained in any such reports filed with the SEC, such
financial statements will fairly present the consolidated financial position of
the entity filing such statements as of the dates indicated and the consolidated
results of operations, changes in shareholders' equity, and cash flows for the
periods then ended in accordance with GAAP (subject in the case of interim
financial statements to normal recurring year-end adjustments that are not
material and except for the absence of certain footnote information in the
unaudited financial statements). As of their respective dates, such reports
filed with the SEC will comply in all material respects with the Securities Laws
and will not contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading. Any financial statements contained in any other reports to
another Regulatory Authority shall be prepared in accordance with the Laws
applicable to such reports.
ARTICLE 8
ADDITIONAL AGREEMENTS
8.1 Registration Statement; Shareholder Approval.
(a) As soon as practicable after execution of this
Agreement, FLB shall file the Registration Statement with the SEC, and shall use
commercially reasonable efforts to cause the Registration Statement to become
effective under the 1933 Act and take any action required to be taken under the
applicable state blue sky or securities Laws in connection with the issuance of
the shares of FLB Common Stock upon consummation of the Merger. SCB shall
furnish all information concerning it and the holders of its capital stock as
FLB may reasonably request in connection with such action.
(b) Each of the Parties shall take, in accordance with
applicable Law and its respective articles of incorporation and bylaws, all
action necessary to convene, respectively, an appropriate meeting of the
shareholders of such Party, each such meeting to be held as promptly as
practical after the date hereof, for the purpose of voting upon approval of this
Agreement and such other related matters as each deems appropriate. In
connection with such shareholders' meetings, (i) each of the Parties shall mail
the Joint Proxy Statement to its respective shareholders, (ii) the Parties shall
furnish to each other all information concerning them that they may reasonably
request in connection with the Registration Statement and the Joint Proxy
Statement, (iii) the Board of Directors of each Party shall recommend (subject
to compliance with their fiduciary duties under applicable law as advised by
counsel) to such Party's shareholders the approval of this AgreemenT, and (iv)
the Board of Directors and officers
26
of each Party shall (subject to compliance with their fiduciary duties under
applicable law as advised by counsel) use commercially reasonable efforts to
obtain such shareholders' approval.
8.2 Applications. As soon as practicable after execution of this
Agreement, FLB shall use commercially reasonable efforts to prepare and file
applications with all Regulatory Authorities having jurisdiction over the
transactions contemplated by this Agreement seeking the requisite Consents
necessary to consummate the transactions contemplated by this Agreement and
thereafter use commercially reasonable efforts to cause the Merger to be
consummated as expeditiously as possible, and SCB shall cooperate in the
preparation and, where appropriate, filing of such applications. Further, FLB
shall, prior to the Closing, prepare and file with the NYSE the required
documents and make payment of the required fees for the shares of FLB Common
Stock to be issued to holders of SCB Common Stock in connection with the Merger.
8.3 Filings With State Offices. Upon the terms and subject to the
conditions of this Agreement, FLB and SCB shall, in connection with the Closing,
execute the Articles of Merger, and FLB shall cause the Articles of Merger to be
filed with the Florida Secretary of State.
8.4 Agreement as to Efforts to Consummate. Subject to the terms
and conditions of this Agreement, each Party agrees to use, and to cause its
Subsidiaries to use, commercially 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 to consummate and make effective, as
soon as practicable after the date of this Agreement, the transactions
contemplated by this Agreement, including commercially reasonable efforts to
lift or rescind any Order adversely affecting its ability to consummate the
transactions contemplated herein and to cause to be satisfied the conditions
referred to in Article 9 of this Agreement; provided, that nothing herein shall
preclude either Party from exercising its rights under this Agreement. Each
Party shall use, and shall cause each of its Subsidiaries to use, commercially
reasonable efforts to obtain all Permits and Consents of all third parties and
Regulatory Authorities necessary or desirable for the consummation of the
transactions contemplated by this Agreement.
8.5 Access to Information; Confidentiality.
(a) From the date hereof to the earlier to occur of the
Effective Time or the termination of this Agreement pursuant to Article 10
hereof, upon reasonable notice and subject to applicable Laws, FLB and SCB shall
afford each other, and each other's accountants, counsel, and other
representatives, during normal working hours for the period of time prior to the
Effective Time or termination of this Agreement pursuant to Article 10 hereof,
reasonable access to all of its and its Subsidiaries' properties, books,
contracts, commitments, and records and, during such period, each shall furnish
promptly to the other Party (i) a copy of each report, schedule, and other
document filed or received by it or any of its Subsidiaries during such period
pursuant to the requirements of the Securities Laws, (ii) a copy of all filings
made with any Regulatory Authorities or other governmental entities in
connection with the transactions contemplated by this Agreement and all written
communications received from such Regulatory Authorities and governmental
entities related thereto, and (iii) all other information concerning either
Party or its respective Subsidiaries' business, properties and personnel as the
other Party may reasonably request, including reports of condition filed with
Regulatory Authorities. In this regard, without limiting the generality of the
foregoing, FLB and its Subsidiaries and Affiliates shall notify SCB promptly
upon the receipt by it of any comments from the SEC, or its staff, and of any
requests by the SEC for amendments or supplements to the Registration Statement
or for additional information and will supply SCB with copies of all
correspondence between it and its representatives, on the one hand, and the SEC
or the members of its staff or any other government official, on the other hand,
with respect to the Registration Statement. Each Party hereto shall, and shall
cause its advisors and representatives to (x) conduct its investigation in such
a manner which will not unreasonably interfere
27
with the normal operations, customers or employee relations of the other and
shall be in accordance with procedures established by the Parties having the due
regard for the foregoing, and (y) refrain from using for any purposes other than
as set forth in this Agreement, and shall treat as confidential, all information
obtained by each hereunder or in connection herewith and not otherwise known to
them prior to the Effective Time.
(b) FLB and its Affiliates will hold, and will use their
best efforts to cause their officers, directors, employees, consultants,
advisors, representatives, and agents to hold, in confidence, unless compelled
by judicial or other legal process, all confidential documents and information
concerning SCB furnished to FLB or its Affiliates in connection with the
transactions contemplated by this Agreement, including information provided in
accordance with this Section 8.5, except to the extent that such information can
clearly be demonstrated by FLB to have been (i) previously known on a
nonconfidential basis by FLB, (ii) in the public domain other than as a result
of disclosure by FLB or any of its Affiliates, or (iii) later lawfully acquired
by FLB from sources other than SCB; provided, however, that FLB may disclose
such information to its officers, directors, employees, consultants, advisors,
representatives, and agents in connection with the transactions contemplated by
this Agreement only to the extent that such Persons who, in FLB's reasonable
judgment, need to know such information for the purpose of evaluating SCB
(provided that such Persons shall be informed of the confidential nature of such
information and shall agree to be bound by the terms of this provision) and, in
any event, such disclosures shall be made only to the extent necessary for such
purposes. If this Agreement is terminated in accordance with Article 10 hereof,
FLB and its Affiliates shall maintain the confidence of such information and
will, and will use their best efforts to cause its officers, directors,
employees, consultants, advisors, representatives, and agents to, return to SCB
all documents and other materials, and all copies made thereof, obtained by FLB
or any of its Affiliates in connection with this Agreement that are subject to
this Section 8.5.
(c) SCB and its Affiliates will hold, and will use their
best efforts to cause their officers, directors, employees, consultants,
advisors, representatives, and agents to hold, in confidence, unless compelled
by judicial or other legal process, all confidential documents and information
concerning FLB furnished to SCB or its Affiliates in connection with the
transactions contemplated by this Agreement, including information provided in
accordance with this Section 8.5, except to the extent that such information can
clearly be demonstrated by SCB to have been (i) previously known on a
nonconfidential basis by SCB, (ii) in the public domain other than as a result
of disclosure by SCB or any of its Affiliates, or (iii) later lawfully acquired
by SCB from sources other than FLB; provided, however, that SCB may disclose
such information to its officers, directors, employees, consultants, advisors,
representatives, and agents in connection with the transactions contemplated by
this Agreement only to the extent that such Persons who, in SCB's reasonable
judgment, need to know such information for the purpose of evaluating FLB
(provided that such Persons shall be informed of the confidential nature of such
information and shall agree to be bound by the terms of this provision) and, in
any event, such disclosures shall be made only to the extent necessary for such
purposes. If this Agreement is terminated in accordance with Article 10 hereof,
SCB and its Affiliates shall maintain the confidence of such information and
will, and will use their best efforts to cause its officers, directors,
employees, consultants, advisors, representatives, and agents to, return to FLB
all documents and other materials, and all copies made thereof, obtained by SCB
or any of its Affiliates in connection with this Agreement that are subject to
this Section 8.5.
8.6 Press Releases. Prior to the Effective Time, SCB and FLB
shall, prior to any release or disclosure, consult with each other as to the
form and substance of any press release or other public disclosure materially
related to this Agreement or any other transaction contemplated hereby;
provided, that nothing in this Section 8.6 shall be deemed to prohibit any Party
from making any disclosure which its counsel deems necessary or advisable in
order to satisfy such Party's disclosure obligations imposed
28
by Law (in which event such Party will use reasonable efforts to provide the
other Party with the opportunity to review and comment on such disclosure prior
to its release).
8.7 Current Information. During the period from the date of this
Agreement until the earlier to occur of the Effective Time or termination of
this Agreement pursuant to Article 10 hereof, each of SCB and FLB shall, and
shall cause its representatives to, confer on a regular and frequent basis with
representatives of the other. Each of SCB and FLB shall promptly notify the
other of (i) any material change in its business or operations, (ii) any
material complaints, investigations, or hearings (or communications indicating
that the same may be contemplated) of any Regulatory Authority, (iii) the
institution or threat of material Litigation involving such Party, or (iv) the
occurrence, or nonoccurrence, of an event or condition, the occurrence, or
nonoccurrence, of which would be reasonably expected to cause any of such
party's representations or warranties set forth herein to be untrue in any
respect as of the Effective Time; and in each case shall keep the other fully
informed with respect thereto.
8.8 Other Actions. No Party shall, or shall permit any of its
Subsidiaries to take any action, except in every case as may be required by
applicable Law, that would or is intended to result in (i) any of its
representations and warranties set forth in this Agreement that are qualified as
to materiality being or becoming untrue, (ii) any of such representations and
warranties that are not so qualified becoming untrue in any material manner
having a Material Adverse Effect, (iii) any of the conditions set forth in this
Agreement not being satisfied or in a violation of any material provision of
this Agreement, or (iv) adversely affecting the ability of any of them to obtain
any of the Consents or Permits from Regulatory Authorities, unless, in any such
case, such action is required by sound banking practice or applicable Law.
8.9 No Solicitation.
(a) From and after the date of this Agreement and until
the earlier of the termination of this Agreement or the Effective Time, except
in compliance with this Section 8.9, SCB will not, and will not permit its
directors, officers, employees, investment bankers, attorneys, accountants or
other representatives, agents or Affiliates to, directly or indirectly, (i)
solicit, initiate, or encourage any Acquisition Proposals; (ii) engage in
discussions with third parties, or negotiations concerning, or provide any
non-public information to any person or entity in connection with, any
Acquisition Proposal; or (iii) agree to, approve, recommend or otherwise endorse
or support any Acquisition Proposal, except that, if SCB receives a
communication that it believes, after consultation with its outside counsel, may
upon clarification constitute a Superior Proposal (as defined below), SCB may
communicate with the person making such communication to the limited extent
necessary to obtain the necessary clarification.
(b) As used herein, the term "Acquisition Proposal" shall
mean any proposal relating to a possible (i) merger, consolidation or similar
transaction involving SCB or any of its Subsidiaries (other than a transaction
with respect to which an acquisition agreement has been executed and publicly
announced as of the date hereof); (ii) sale, lease or other disposition,
directly or indirectly, involving SCB or any of its Subsidiaries representing,
in the aggregate, 15% or more of the Assets of SCB on a consolidated basis;
(iii) issuance, sale or other disposition of (including by way of merger,
consolidation, share exchange or any similar transaction) securities (or
options, rights or warrants to purchase or securities convertible into, such
securities) representing 15% or more of the votes attached to the outstanding
securities of SCB; (iv) transaction with SCB in which any person shall acquire
beneficial ownership (as such term is defined in Rule 13d-3 under the Exchange
Act), or the right to acquire beneficial ownership, or any "group" (as such term
is defined under the Exchange Act) shall have been formed which beneficially
owns or has the right to acquire beneficial ownership of, 15% or more of the
outstanding shares of SCB Common Stock; or (v) any other consolidation, business
combination, recapitalization or similar transaction involving SCB or any of its
subsidiaries, as a result of which the holders of shares of SCB Common Stock
immediately prior to such transaction do not, in the aggregate,
29
own at least 85% of each of the outstanding shares of common stock and the
outstanding voting power of the surviving or resulting entity in such
transaction immediately after the consummation thereof in substantially the same
proportion as such holders held the shares of SCB Common Stock immediately prior
to the consummation thereof; provided, however, that the term "Acquisition
Proposal" shall not include the Merger and the transactions contemplated hereby.
(c) Notwithstanding the provisions of Section 8.9(a)
above, if a corporation, limited liability company, limited liability
partnership, partnership, person or other entity or group (a "Third Party")
after the date of this Agreement submits to SCB's Board of Directors an
unsolicited, bona fide, written Acquisition Proposal, and SCB's Board of
Directors reasonably determines in good faith, after receipt of advice from
outside legal counsel that the failure to engage in discussions with the Third
Party concerning such Acquisition Proposal would likely cause SCB's Board of
directors to breach its fiduciary duties to SCB and its shareholders, then, in
such case, (i) SCB may (A) furnish information about its business to the Third
Party under protection of an appropriate confidentiality agreement containing
customary limitations on the use and disclosure of all non-public written or
oral information furnished to such Third Party, provided that SCB must
contemporaneously furnish to FLB all such non-public information furnished to
the Third Party which has not been previously disclosed to FLB and (B) negotiate
and participate in discussions and negotiations with such Third Party; and (ii)
if SCB's Board of Directors determines that such an Acquisition Proposal is a
Superior Proposal, SCB's Board of Directors may (subject to the provisions of
this Section 8.9) (A) withdraw or adversely modify its approval or
recommendation of the Merger and recommend such Superior Proposal or (B)
terminate this Agreement, in each case, at any time after the second business
day following delivery of written notice to FLB (a "Notice of Superior
Proposal") advising FLB that SCB's Board of Directors has received a Superior
Proposal, identifying the Third Party and specifying the material terms and
conditions of such Superior Proposal. SCB may take either of the foregoing
actions pursuant to the preceding sentence if, and only if, an Acquisition
Proposal that was a Superior Proposal continues to be a Superior Proposal in
light of any improved proposal submitted by FLB, considered in good faith by SCB
and with the advice of a financial advisor of nationally recognized reputation,
prior to the expiration of the two business day period specified in the
preceding sentence. For purposes of this Agreement, "Superior Proposal" means
any unsolicited, bona fide, written Acquisition Proposal for consideration
consisting of cash and/or securities, and otherwise on terms which SCB's Board
of Directors determines are more favorable to SCB's shareholders from financial
point of view than the Merger (or other revised proposal submitted by FLB as
contemplated above), after consultation with its outside legal counsel and a
financial adviser of nationally recognized reputation and that the Third Party
is reasonably likely to consummate the Superior Proposal on the terms proposed.
(d) Nothing contained in this Section 8.9 shall prohibit
SCB from taking, and disclosing to its shareholders, a position required by Rule
14e-2(a) or Rule 14d-9(e) under the Exchange Act.
(e) SCB will notify FLB promptly, and in any event within
24 hours, if (i) a bona fide Acquisition Proposal is made or is modified in any
material respect (including the principal terms and conditions of any such
Acquisition Proposal or modification thereto and the identity of the offeror) or
(ii) SCB furnishes non-public information to, or enters into discussions or
negotiations with respect to an acquisition Proposal with, any Third Party.
(f) In addition to the obligations of SCB set forth in
this Section 8.9, SCB, as promptly as practicable, will advise FLB orally and in
writing of any request for information which SCB reasonably believes could lead
to an Acquisition Proposal or of any Acquisition Proposal, and the material
terms and conditions of such request, Acquisition Proposal or inquiry, and SCB
will keep FLB informed in all material respects of the status of any such
request, Acquisition Proposal or inquiry.
30
(g) It is understood and agreed that, without limitation
of SCB's obligations hereunder, any violation of this Section 8.9 by any
director, officer, Affiliate, investment bank, financial advisor, accountant,
attorney or other advisor or representative of SCB, whether or not such person
or entity is purporting to act on behalf of SCB, shall be deemed to be a breach
of this Section 8.9 by SCB. SCB agrees that, as of the date hereof, it, its
Affiliates and their respective directors, officers, employees, investment
bankers, attorneys, accountants and other representatives and agents, shall
immediately cease and cause to be terminated any existing activities,
discussions and negotiations with any Third Party (other than FLB and its
representatives) conducted heretofore with respect to any Acquisition Proposal.
8.10 Agreement of Affiliates. SCB has disclosed in Section 8.10 of
the SCB Disclosure Memorandum all Persons whom it reasonably believes are
"affiliates" of SCB as that term is defined in Rule 145 under the 1933 Act. SCB
shall use commercially reasonable efforts to cause each Person who may be deemed
an affiliate of SCB to execute and deliver to FLB not later than the date of
mailing of the Joint Proxy Statement, a written agreement, substantially in the
form of Exhibit 1 hereto.
8.11 Employment Contracts. At the request of SCB, FLB shall offer
to enter into employment agreements with the persons listed on Exhibit 2 on
terms mutually acceptable to SCB and FLB, in exchange for each such person's
agreement to cancel and terminate any existing employment agreements between
each such person and SCB.
8.12 Indemnification: Directors' and Officers' Insurance.
(a) In the event of any threatened or actual claim,
action suit, proceeding or investigation, whether civil, criminal or
administrative, including any such claim, action suit, proceeding or
investigation in which any individual who is now, or has been at any time prior
to the date of this Agreement, or who becomes prior to the Effective Time, a
director, officer or employee of SCB or any of its Subsidiaries or who is or was
serving at the request of SCB or any of its Subsidiaries as a director, officer,
employee or agent of another person (the "Indemnified Parties"), is, or is
threatened to be, made a party based in whole or in part on, or arising in whole
or in part out of, or pertaining to (i) the fact that he is or was a director,
officer or employee of SCB or any of its Subsidiaries or (ii) this Agreement or
any of the transactions contemplated by this Agreement, whether asserted or
arising before or after the Effective Time, the parties shall cooperate and use
their best efforts to defend against and respond thereto. From and after the
Effective Time, FLB shall indemnify and hold harmless, as and to the fullest
extent provided by applicable law, the Articles of Incorporation and Bylaws of
SCB, each such Indemnified Party against any losses, claims, damages,
liabilities, costs, expenses (including reimbursement for reasonable fees and
expenses incurred in advance of the final disposition of any claim, suit,
proceeding or investigation to each Indemnified Party as provided by the
Articles of Incorporation or Bylaws of SCB), judgments, fines and amounts paid
in settlement in connection with any such threatened or actual claim, action,
suit, proceeding or investigation. Without limiting the foregoing, in any case
in which approval of FLB is required to effectuate any indemnification, FLB
shall direct or cause such FLB Company to direct, at the election of the
Indemnified Party, that the determination of any such approval shall be made by
independent counsel mutually agreed upon between FLB and the Indemnified Party.
FLB shall, and shall cause all other relevant FLB Companies, to apply such
rights of indemnification in good faith and to the fullest extent permitted by
Law.
(b) FLB shall use commercially reasonable efforts to
cause the individuals serving as officers and directors of SCB or any of its
Subsidiaries immediately prior to the Effective Time to be covered for a period
of four years from the Effective Time by the directors' and officers' liability
insurance policy maintained by SCB (provided that FLB may substitute therefor
policies of at least the same coverage and amounts containing terms and
conditions that are not less advantageous than such
31
policy) with respect to acts or omissions occurring prior to the Effective Time
that were committed by such officers and directors in their capacity as such.
(c) If FLB or any of its successors or assigns shall
consolidate with or merge into any other Person and shall not be the continuing
or surviving Person of such consolidation or merger or shall transfer all or
substantially all of its assets to any Person, then and in each case, proper
provision shall be made so that the successors and assigns of FLB shall assume
the obligations set forth in this Section 8.12.
(d) The provisions of this Section 8.12 shall survive the
Effective Time and are intended to be for the benefit of, and shall be
enforceable by, each Indemnified Party and his or her heirs and representatives.
8.13 Additional Reports. In accordance with Section 8.5, SCB and
FLB shall each furnish to the other copies of any SEC Documents that it files
with the SEC on or after the date hereof, and SCB and FLB, as the case may be,
represents and warrants that as of the respective dates thereof, such SEC
Documents will not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statement therein, in light of the circumstances under which they were made, not
misleading. Any unaudited consolidated interim financial statements included in
such SEC Documents (including any related notes and schedules) will fairly
present, in all material respects, the financial position of SCB or FLB, as the
case may be, as of the dates thereof and the results of operations and changes
in financial position or other information included therein for the periods or
as of the dates then ended, in each case in accordance with past practice and
GAAP consistently applied during the periods involved (except that such
unaudited financial statement exclude footnote disclosures necessary for a fair
presentation which would make them in compliance with GAAP, and such financial
statements are subject, where appropriate, to normal year-end adjustments).
8.14 Exemption from Liability under Section 16(b)
(a) Provided that SCB delivers to FLB the Section 16
Information (as defined below) with respect to SCB prior to the Effective Time,
the Board of Directors of FLB, or a committee of Non-Employee Directors thereof
(as such term is defined for purposes of Rule 16b-3(d) under the Exchange Act),
will adopt a resolution in advance of the Effective Time providing that the
receipt by SCB Insiders (as defined below) of FLB Common Stock in exchange for
shares of SCB Common Stock, and the receipt of options of FLB in exchange for
options of SCB, pursuant to the transactions contemplated hereby and to the
extent such securities are listed in the Section 16 Information, are intended to
be exempt from liability pursuant to Rule 16b-3 under the Exchange Act.
(b) "Section 16 Information" shall mean information
accurate in all respects regarding SCB Insiders, the number of shares of SCB
Common Stock or other SCB equity securities deemed to be beneficially owned by
each SCB Insider and expected to be exchanged for FLB Common Stock in connection
with the Merger, provided that the requirement for a description of any SCB
Stock Options shall be deemed to be satisfied if copies of all SCB Stock Plans,
and forms of agreements evidencing grants thereunder which such SCB Stock
Options have been granted, have been made available to FLB.
(c) "SCB Insiders" shall mean those officers and
directors of SCB who are subject to the reporting requirements of Section 16(a)
of the Exchange Act who are listed in the Section 16 Information.
32
8.15 Right to Update Disclosure Memoranda. Each Party shall have
the right, without being in breach of its representations and warranties set
forth in this Agreement, to supplement or amend its Disclosure Memorandum, and
to add additional references to its Disclosure Memorandum to its representations
and warranties contained in this Agreement, with respect to any matter arising
after the date hereof or discovered between the date hereof and the date of the
Closing. A copy of the amended or supplemented Disclosure Memorandum and the
additional Disclosure Memorandum references shall be promptly provided to the
other Party. Any such amended or supplemented Disclosure Memorandum and
additional Disclosure Memorandum references shall not give the other Party the
right not to proceed to Closing, unless the facts underlying such amended or
supplemented Disclosure Memorandum or additional Disclosure Memorandum
references would be reasonably likely to result in a Material Adverse Effect.
8.16 Employee Matters.
(a) From the Effective Time, FLB shall provide the
employees of the SCB Companies and its Subsidiaries as of the Effective Time
(the "Covered Employees") with employee benefits and compensation plans,
programs and arrangements that are equivalent to those provided to similarly
situated employees of FLB and its Subsidiaries.
(b) From and after the Effective Time, FLB shall (i)
provide all Covered Employees with service credit for purposes of eligibility,
participation, vesting and levels of benefits (but not for benefit accruals
under any defined benefit pension plan), under any employee benefit or
compensation plan, program or arrangement adopted, maintained or contributed to
by FLB or any of its Subsidiaries in which Covered Employees are eligible to
participate, for all periods of employment with SCB or any of its Subsidiaries
prior to the Effective Time, (ii) cause any pre-existing conditions or
limitations, eligibility waiting periods or required physical examinations under
any welfare benefit plans of FLB or any of its Subsidiaries to be waived with
respect to the Covered Employees and their eligible dependents, to the extent
waived under the corresponding plan in which the applicable Covered Employee
participated immediately prior to the Effective Time and, with respect to life
insurance coverage, up to the Covered Employee's current level of insurability,
and (iii) give the Covered Employees and their eligible dependents credit for
the plan year in which the Effective Time (or commencement of participation in a
plan of FLB or any of its Subsidiaries) occurs towards applicable deductibles
and annual out-of-pocket limits for expenses incurred prior to the Effective
Time (or the date of commencement of participation in a plan of FLB or any of
its Subsidiaries).
(c) From and after the Effective Time, FLB shall honor
all accrued and vested benefit obligations to and contractual rights of current
and former employees of SCB and its Subsidiaries under the SCB Benefit Plans.
ARTICLE 9
CONDITIONS PRECEDENT TO OBLIGATIONS TO CONSUMMATE
9.1 Conditions to Obligations of Each Party. The respective
obligations of each Party to perform this Agreement and consummate the Merger
and the other transactions contemplated hereby are subject to the satisfaction
of the following conditions, unless waived by both Parties pursuant to Section
11.7 of this Agreement:
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(a) Shareholder Approvals. The shareholders of each of
SCB and FLB shall have approved this Agreement, and the consummation of the
transactions contemplated hereby, including the Merger, as and to the extent
required by Law.
(b) Regulatory Approvals. All Consents of, filings and
registrations with, and notifications to, all Regulatory Authorities required
for consummation of the Merger shall have been obtained or made and shall be in
full force and effect and all waiting periods required by Law shall have
expired. No Consent obtained from any Regulatory Authority which is necessary to
consummate the transactions contemplated hereby shall be conditioned or
restricted in a manner (including requirements relating to the raising of
additional capital or the disposition of Assets) which in the reasonable
judgment of the Board of Directors of either Party would so materially adversely
impact the economic or business benefits of the transactions contemplated by
this Agreement that, had such condition or requirement been known, such Party
would not, in its reasonable judgment, have entered into this Agreement.
(c) Consents and Approvals. Other than filing the
Articles of Merger, each Party shall have obtained any and all Consents required
for consummation of the Merger (other than those referred to in Section 9.1(b)
of this Agreement or listed in Section 9.1(c) of the SCB Disclosure Memorandum)
or for the preventing of any default under any Contract or Permit of such Party
which, if not obtained or made, is reasonably likely to have, individually or in
the aggregate, a Material Adverse Effect on such Party.
(d) Legal Proceedings. No court or governmental or
regulatory authority of competent jurisdiction shall have enacted, issued,
promulgated, enforced, or entered any Law or Order (whether temporary,
preliminary, or permanent) or taken any other action which prohibits, restricts,
or makes illegal consummation of the transactions contemplated by this
Agreement.
(e) Registration Statement. The Registration Statement
shall have been declared effective under the 1933 Act, and no stop orders
suspending the effectiveness of the Registration Statement shall have been
issued, and no action, suit, proceeding, or investigation by the SEC to suspend
the effectiveness thereof shall have been initiated and be continuing.
(f) Tax Matters. Each Party shall have received a written
opinion from its respective counsel, in a form reasonably satisfactory to such
Party (the "Tax Opinions"), to the effect that (i) the Merger will constitute a
reorganization within the meaning of Section 368(a) of the Internal Revenue Code
and (ii) the exchange in the Merger of SCB Common Stock for FLB Common Stock
will not give rise to gain or loss to the shareholders of SCB with respect to
such exchange (except to the extent of any cash received). In rendering each
such Tax Opinion, such counsel shall be entitled to rely upon representations of
officers of SCB and FLB reasonably satisfactory in form and substance to such
counsel.
(g) NYSE Listing. The shares of FLB Common Stock to be
issued to the holders of SCB Common Stock upon consummation of the Merger shall
have been authorized for listing on the NYSE, subject to official notice of
issuance.
9.2 Conditions to Obligations of FLB. The obligations of FLB to
perform this Agreement and consummate the Merger and the other transactions
contemplated hereby are subject to the satisfaction of the following conditions,
unless waived by FLB pursuant to Section 11.7(a) of this Agreement:
(a) Representations and Warranties. The representations
and warranties of SCB contained herein shall be true and correct both as of the
date of this Agreement and (except to the extent such representations and
warranties speak as of an earlier date) as of the Effective Time, except where
the
34
failure of such representations and warranties to be so true and correct
(without giving effect to any limitation as to "materiality" or "Material
Adverse Effect" set forth therein) would not have, individually or in the
aggregate, a Material Adverse Effect on SCB.
(b) Performance of Agreements and Covenants. Each and all
of the agreements and covenants of SCB to be performed and complied with
pursuant to this Agreement and the other agreements contemplated hereby prior to
the Closing Date shall have been duly performed and complied with in all
material respects.
(c) Certificates. SCB shall have delivered to FLB (i) a
certificate, dated as of the Closing Date and signed on its behalf by its chief
executive officer and its chief financial officer, to the effect that the
conditions of its obligations set forth in Section 9.2(a) and 9.2(b) of this
Agreement have been satisfied, and (ii) certified copies of resolutions duly
adopted by SCB's Board of Directors and shareholders evidencing the taking of
all corporate action necessary to authorize the execution, delivery, and
performance of this Agreement, and the consummation of the transactions
contemplated hereby, all in such reasonable detail as FLB and its counsel shall
request.
(d) Non-Compete Agreements. FLB shall have received an
executed copy of a Non-Compete Agreement in the form attached to this Agreement
as Exhibit 3 from at least 90% of the directors of SCB who are not executive
officers of SCB.
(e) Opinion of Counsel. FLB shall have received a written
opinion of Xxxxxx & Xxxxx LLP, counsel to SCB, dated as of the Closing Date, in
substantially the form attached hereto as Exhibit 4.
(f) Employment Agreements. A majority of the employees of
SCB identified on Exhibit 2 shall have entered into employment agreements with
FLB, effective as of the Effective Time, containing terms as set forth on
Exhibit 2.
(g) Material Adverse Effect. Since the date of this
Agreement, there shall not have been any event, change or occurrence which had,
or is reasonably likely to have, individually or in the aggregate, a Material
Adverse Effect on SCB.
9.3 Conditions to Obligations of SCB. The obligations of SCB to
perform this Agreement and consummate the Merger and the other transactions
contemplated hereby are subject to the satisfaction of the following conditions,
unless waived by SCB pursuant to Section 11.7(b) of this Agreement:
(a) Representations and Warranties. The representations
and warranties of FLB contained herein shall be true and correct both as of the
date of this Agreement and (except to the extent such representations and
warranties speak as of an earlier date) as of the Closing Date, except where the
failure of such representations and warranties to be so true and correct
(without giving effect to any limitation as to "materiality" or "Material
Adverse Effect" set forth therein) would not have, individually or in the
aggregate, a Material Adverse Effect on FLB.
(b) Performance of Agreements and Covenants. Each and all
of the agreements and covenants of FLB to be performed and complied with
pursuant to this Agreement and the other agreements contemplated hereby prior to
the Closing Date shall have been duly performed and complied with in all
material respects.
(c) Certificates. FLB shall have delivered to SCB (i) a
certificate, dated as of the Closing Date and signed on its behalf by its chief
executive officer and its chief financial officer, to the
35
effect that the conditions of its obligations set forth in Section 9.3(a) and
9.3(b) of this Agreement have been satisfied, and (ii) certified copies of
resolutions duly adopted by FLB's Board of Directors evidencing the taking of
all corporate action necessary to authorize the execution, delivery, and
performance of this Agreement, and the consummation of the transactions
contemplated hereby, all in such reasonable detail as SCB and its counsel shall
request.
(d) Opinion of Counsel. SCB shall have received a written
opinion of Xxxxx, Xxxxxxxx & Xxxxxxx, LLP, counsel to FLB, dated as of the
Closing Date, in substantially the form attached hereto as Exhibit 5.
(e) Material Adverse Event. Since the date hereof, there
shall not have been any event, change or occurrence which had, or is reasonably
likely to have individually or in the aggregate, a Material Adverse Effect on
FLB.
ARTICLE 10
TERMINATION
10.1 Termination. Notwithstanding any other provision of this
Agreement, this Agreement may be terminated and the Merger abandoned at any time
prior to the Effective Time:
(a) By mutual written consent of FLB and SCB; or
(b) By either Party in the event of an inaccuracy of any
representation or warranty of the other Party contained in this Agreement which
cannot be or has not been cured within 40 days after the giving of written
notice to the breaching Party of such inaccuracy and which inaccuracy would
provide the terminating Party the ability to refuse to consummate the Merger
pursuant to Section 9.2(a) or Section 9.3(a) of this Agreement; or
(c) By either Party in the event of a material breach by
the other Party of any covenant, agreement, or obligation contained in this
Agreement which breach cannot be or has not been cured within 40 days after the
giving of written notice to the breaching Party of such breach; or
(d) By either Party in the event any Consent of any
Regulatory Authority required for consummation of the Merger and the other
transactions contemplated hereby shall have been denied by final nonappealable
action of such authority or if any action taken by such authority is not
appealed within the time limit for appeal; or
(e) By either Party in the event the shareholders of SCB
or FLB fail to vote their approval of this Agreement and the transactions
contemplated hereby as required by applicable Law at the meetings of such
shareholders to be held pursuant to Section 8.1; or
(f) By either Party in the event that the Merger shall
not have been consummated by December 31, 2004, if the failure to consummate the
transactions contemplated hereby on or before such date is not caused by any
breach of this Agreement by the Party electing to terminate pursuant to this
Section 10.1(f); or
(g) By either Party (provided that the terminating Party
is not then in breach of any representation or warranty contained in this
Agreement under the applicable standard set forth in Section
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9.2(a) of this Agreement in the case of SCB and Section 9.3(a) in the case of
FLB or in material breach of any covenant or other agreement contained in this
Agreement) in the event that any of the conditions precedent to the obligations
of such Party to consummate the Merger cannot be satisfied or fulfilled by the
date specified in Section 10.1(f) of this Agreement; or
(h) By SCB at any time during the three business day
period commencing on the first business day following the Approval Date, if the
average per share closing price of the FLB Common Stock on the NYSE over the
twenty trading days ending on the Approval Date is less than $15.00 (which
amount shall be appropriately adjusted to reflect any stock splits, stock
dividends or similar transactions); provided, however, that SCB agrees that it
will not exercise its right of termination for a period of fifteen days
following the Approval Date, and during such period will agree to consider any
proposal made by FLB, provided that SCB may accept or reject such proposal in
SCB's sole discretion.
(i) By SCB pursuant to the provisions of Section 8.9.
10.2 Effect of Termination. In the event of the termination of this
Agreement pursuant to Section 10.1 of this Agreement, this Agreement shall
become void and have no effect, and neither Party shall have any liability of
any nature whatsoever under this Agreement or in connection with the
transactions contemplated by this Agreement except that (i) the provisions of
this Section 10.2 and Sections 8.5, 10.3, 10.4 and Article 11 of this Agreement
shall survive any such termination, and (ii) such termination shall not relieve
any Party from liability arising from any willful breach of any provision of
this Agreement.
10.3 Termination Fees.
(a) In the event that this Agreement is terminated:
(i) by either FLB or SCB pursuant to Section
10.1(e) as a result of the failure of the shareholders of SCB to approve this
Agreement at the SCB Shareholders Meeting and either (A) at the time of the SCB
Shareholders' Meeting (or at any adjournment thereof) an Acquisition Proposal
shall have been publicly disclosed and not withdrawn, or (B) prior to the SCB
Shareholders' Meeting, SCB's Board of Directors shall have withdrawn its
recommendation or refused to recommend to the shareholders of SCB that they vote
to approve this Agreement; or
(ii) by FLB pursuant to Section 10.1(c) as a
result of a material breach by SCB of Section 8.9; or
(iii) by FLB pursuant to Section 10.1(c) as a
result of any knowing, willful or intentional breach of this Agreement on the
part of SCB (other than a material breach by SCB of Section 8.9); provided that:
(A) at the time of such termination SCB shall not be entitled to terminate the
Agreement pursuant to Section 10.1(b) or 10.1(c); and (B) either (1) an
Acquisition Proposal shall have been publicly disclosed at or before the time of
such breach; or (2) an overture from a bona fide person or entity shall have
been communicated to the SCB Board of Directors at or before the time of such
breach to engage in an agreement, plan or transaction to acquire or purchase all
or a substantial portion of the assets of or a substantial equity interest in,
or to effect any recapitalization, liquidation or dissolution involving or a
business combination or other similar transaction with, SCB or any SCB
Subsidiary (including, without limitation, a bona fide tender offer or exchange
offer to purchase SCB common stock) other than with FLB or a FLB Subsidiary; or
(iv) by SCB pursuant to Section 10.1(i);
37
and, within six months of any termination described in (i),
(ii), (iii) or (iv) above, SCB consummates, or enters into a definitive
agreement with respect to consummation of, an Acquisition Proposal (an
"Alternative Transaction Event"),
then,
SCB shall within five Business Days after the occurrence of
such Alternative Transaction Event, pay to FLB a termination fee equal
to $7,500,000 (the "SCB Termination Fee") by wire transfer of
immediately available funds. The SCB Termination Fee will be the sole
and exclusive remedy of FLB for all claims under this Agreement.
(b) In the event this Agreement is terminated by either
FLB or SCB, pursuant to Section 10.1(e) as a result of the failure of the
shareholders of FLB to approve this Agreement and the transactions contemplated
by this Agreement at the FLB shareholders' meeting, then FLB shall, within 5
business days after the termination of this Agreement for such reason, pay to
SCB the Termination Fee of $7,500,000 (the "FLB Termination Fee") by wire
transfer of immediately available funds.
(c) In the event this Agreement is terminated by SCB as a
result of FLB's failure to satisfy any of its representations, warranties or
covenants set forth herein, then FLB shall reimburse SCB for its reasonable
out-of-pocket expenses relating to the Merger in an amount not to exceed
$1,000,000, which amount shall not be deemed an exclusive remedy or liquidated
damages.
10.4 Reimbursement of Certain Costs. Each Party acknowledges that
the agreements contained in Section 10.3 are an integral part of the
transactions contemplated by this Agreement and that, without these agreements,
neither Party would have entered into this Agreement; accordingly, if either
Party fails promptly to pay any amount due pursuant to Section 10.3 and, in
order to obtain such payment, the other Party commences a suit which results in
a judgment against such Party for all or a substantial portion of the payment
required by Section 10.3, the Party required to make such payment shall pay to
the Party entitled to such payment its costs and expenses (including reasonable
attorneys' fees) in connection with such suit, together with interest on the
amounts due from the date that payment was required to be made until the date
payment is made at the prime rate of SunTrust Bank, N.A. in effect on the date
payment was required to be made plus two percentage points.
10.5 Non-Survival of Representations and Covenants. The respective
representations and warranties of the Parties shall not survive the Effective
Time. All agreements of the Parties to this Agreement which by their terms are
to be performed following the Effective Time shall survive the Effective Time
until performed in accordance with their terms.
ARTICLE 11
MISCELLANEOUS
11.1 Definitions.
(a) Except as otherwise provided herein, the capitalized
terms set forth below shall have the following meanings:
"1933 Act" shall mean the Securities Act of 1933, as amended.
38
"1934 Act" shall mean the Securities Exchange Act of 1934, as amended.
"Acquisition Proposal" shall have the meaning set forth in Section 8.9
of this Agreement.
"Affiliate" of a Person shall mean any other Person directly, or
indirectly through one or more intermediaries, controlling, controlled by or
under common control with such Person.
"Agreement" shall mean this Agreement and Plan of Merger, including the
Exhibits hereto, the FLB Disclosure Memorandum and the SCB Disclosure
Memorandum.
"Approval Date" shall mean the date on which the last of the following
occurs: (i) the effective date (including expiration of any applicable waiting
period required by Law) of the last required Consent of any Regulatory Authority
having authority over and approving or exempting the Merger, (ii) the date on
which the shareholders of SCB approve this Agreement to the extent that such
approval is required by applicable Law; and (iii) the date on which the
shareholders of FLB approve this Agreement to the extent that such approval is
required by applicable Law.
"Articles of Merger" shall mean the Articles of Merger to be executed
by the Parties and filed with the Secretary of State of the State of Florida
relating to the Merger as contemplated by Section 1.3 of this Agreement.
"Assets" of a Person shall mean all of the assets, properties,
businesses, and rights of such Person of every kind, nature, character, and
description, whether real, personal, or mixed, tangible or intangible, accrued
or contingent, or otherwise relating to or utilized in such Person's business,
directly or indirectly, in whole or in part, whether or not carried on the books
and records of such Person, and whether or not owned in the name of such Person
or any Affiliate of such Person and wherever located.
"BHC Act" shall mean the federal Bank Holding Company Act of 1956, as
amended.
"Closing" shall have the meaning set forth in Section 1.2 of this
Agreement.
"Consent" shall mean any consent, approval, authorization, clearance,
exemption, waiver, or similar affirmation by any Person.
"Contract" shall mean any written agreement, commitment, contract,
note, bond, mortgage, indenture, instrument, lease, obligation, or plan of any
kind or character, or other document to which any Person is a party or that is
binding on any Person or its capital stock or Assets.
"Default" shall mean (i) any breach or violation of or default under
any Contract, (ii) any occurrence of any event that with the passage of time or
the giving of notice or both would constitute a breach or violation of or
default under any Contract, or (iii) any occurrence of any event that with or
without the passage of time or the giving of notice would give rise to a right
to terminate or revoke, change the current terms of, or renegotiate, or to
accelerate, increase, or impose any liability under, any Contract where, in any
such event, such default is reasonably likely to have a Material Adverse Effect
on a Party.
"Effective Time" shall have the meaning set forth in Section 1.3 of
this Agreement.
"Environmental Laws" shall mean all Laws relating to pollution or
protection of human health or the environment (including ambient air, surface
water, ground water, land surface, or subsurface strata)
39
and which are administered, interpreted, or enforced by the United States
Environmental Protection Agency and state and local agencies with jurisdiction
over, and including common law in respect of, pollution or protection of the
environment, including the Comprehensive Environmental Response Compensation and
Liability Act, as amended, 42 U.S.C. 9601 et seq., the Resource Conservation and
Recovery Act, as amended, 42 U.S.C. 6901 et seq., and other Laws relating to
emissions, discharges, releases, or threatened releases of any Hazardous
Material, or otherwise relating to the manufacture, processing, distribution,
use, treatment, storage, disposal, transport, or handling of any Hazardous
Material.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as amended.
"Exchange Agent" shall have the meaning set forth in Section 4.1 of
this Agreement.
"Exchange Ratio" shall have the meaning set forth in Section 3.1(c) of
this Agreement.
"Exhibits" 1, 2, 3, 4 and 5 shall mean the Exhibits so marked, copies
of which are attached to this Agreement. Such Exhibits are hereby incorporated
by reference herein and made a part hereof, and may be referred to in this
Agreement and any other related instrument or document without being attached
hereto.
"FBCA" shall mean the Florida Business Corporation Act.
"FLB" shall have the meaning set forth in the first paragraph of this
Agreement.
"FLB Capital Stock" shall have the meaning set forth in Section 6.3 of
this Agreement.
"FLB Common Stock" shall mean the $0.01 par value common stock of FLB.
"FLB Companies" shall mean, collectively, FLB and all FLB Subsidiaries.
"FLB Contract" shall have the meaning set forth in Section 6.16 of this
Agreement.
"FLB Disclosure Memorandum" shall mean the written information entitled
"FLB Corporation Disclosure Memorandum" delivered prior to the date of this
Agreement to SCB, and all amendments or supplements thereto occurring between
the date of this Agreement and the date of the Closing, describing in reasonable
detail the matters contained therein and, with respect to each disclosure made
therein, specifically referencing each Section of this Agreement under which
such disclosure is being made. Information disclosed with respect to one Section
shall not be deemed to be disclosed for purposes of any other Section not
specifically referenced with respect thereto.
"FLB Financial Statements" shall mean certain financial statements of
FLB consisting of (i) the consolidated balance sheets and the related statements
of income, changes in shareholders' equity, and cash flows (including related
notes and schedules, if any) as of and for each of the three years ended
December 31, 2003, 2002, and 2001, as contained in the FLB SEC Reports, and (ii)
the consolidated balance sheets and related statements of income, changes in
shareholders' equity, and cash flows (including related notes and schedules, if
any) included in any SEC Document filed by FLB with respect to any period ended
subsequent to December 31, 2003.
"FLB SEC Reports" shall have the meaning set forth in Section 6.5(a) of
this Agreement.
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"FLB Shareholders' Meeting" shall mean the meeting of the shareholders
of FLB to be held pursuant to Section 8.1 of this Agreement, including any
adjournment or adjournments thereof.
"FLB Subsidiaries" shall mean the Subsidiaries of FLB, which shall
include any corporation, bank, savings association, or other organization
acquired as a Subsidiary of FLB in the future and owned by FLB at the Effective
Time.
"GAAP" shall mean generally accepted accounting principles in the
United States, consistently applied during the periods involved applicable to
banks or bank holding companies, as the case may be.
"Hazardous Material" shall mean (i) any hazardous substance, hazardous
material, hazardous waste, regulated substance, or toxic substance (as those
terms are defined by any applicable Environmental Laws) and (ii) any chemicals,
pollutants, contaminants, petroleum, petroleum products, or oil (and
specifically shall include asbestos requiring abatement, removal, or
encapsulation pursuant to the requirements of governmental authorities, and any
polychlorinated biphenyls).
"HSR Act" shall mean Section 7A of the Xxxxxxx Act, as added by Title
II of the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as amended, and
the rules and regulations promulgated thereunder.
"Indemnified Party" shall have the meaning set forth in Section 8.14 of
this Agreement.
"Internal Revenue Code" shall mean the Internal Revenue Code of 1986,
as amended, and the rules and regulations promulgated thereunder.
"Joint Proxy Statement" shall mean the proxy statement used by SCB and
FLB to solicit the approval of their respective shareholders of the transactions
contemplated by this Agreement, which shall include the prospectus of FLB
relating to the issuance of the FLB Common Stock to holders of SCB Common Stock.
"Knowledge" as used with respect to a Person (including references to
such Person being aware of a particular matter) shall mean the personal
knowledge of the chairman, president, chief financial officer, chief accounting
officer, chief credit officer, or any executive vice president of such Person.
"Law" shall mean any code, law, ordinance, regulation, reporting or
licensing requirement, rule, or statute applicable to a Person or its Assets,
liabilities, or business, including those promulgated, interpreted, or enforced
by any Regulatory Authority.
"Lien" with respect to any Asset, shall mean any conditional sale
agreement, default of title, easement, encroachment, encumbrance, hypothecation,
infringement, lien, mortgage, pledge, reservation, restriction, security
interest, title retention, or other security arrangement, or any adverse right
or interest, charge, or claim of any nature whatsoever of, on, or with respect
to any property or property interest, other than (i) Liens for current property
Taxes not yet due and payable or being contested in good faith, (ii) for
depository institution Subsidiaries of a Party, pledges to secure deposits, and
(iii) other Liens incurred in the ordinary course of the banking business.
"Litigation" shall mean any action, arbitration, cause of action,
claim, complaint, criminal prosecution, demand letter, governmental or other
examination or investigation, hearing, inquiry, administrative or other
proceeding, or notice by any Person alleging potential liability.
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"Loan Property" shall mean any property owned, leased, or operated by
the Party in question or by any of its Subsidiaries or in which such Party or
its Subsidiary holds a security or other interest (including an interest in a
fiduciary capacity), and, where required by the context, includes the owner or
operator of such property, but only with respect to such property.
"Material Adverse Effect" on a Party shall mean an event, change, or
occurrence which, individually or together with any other event, change, or
occurrence, has a material adverse impact on (i) the financial position,
business, or results of operations of such Party and its Subsidiaries, taken as
a whole, or (ii) the ability of such Party to perform its obligations under this
Agreement or to consummate the Merger or the other transactions contemplated by
this Agreement, provided that "Material Adverse Effect" shall not be deemed to
include the impact of (a) changes in banking and similar Laws of general
applicability or interpretations thereof by courts or governmental authorities,
(b) changes in GAAP or regulatory accounting principles generally applicable to
banks and their holding companies, (c) actions and omissions of a Party (or any
of its Subsidiaries) taken with the prior informed consent of the other Party in
contemplation of the transactions contemplated hereby, or (d) the Merger and
compliance with the provisions of this Agreement on the operating performance of
the Parties.
"Merger" shall have the meaning set forth in the Preamble of this
Agreement.
"NYSE" shall mean the New York Stock Exchange, Inc.
"Order" shall mean any decree, injunction, judgment, order, decision or
award, ruling, or writ of any federal, state, local, or foreign or other court,
arbitrator, mediator, tribunal, administrative agency, or Regulatory Authority.
"Participation Facility" shall mean any facility or property in which
the Party in question or any of its Subsidiaries participates in the management
and, where required by the context, said term means the owner or operator of
such facility or property, but only with respect to such facility or property.
"Party" shall mean either SCB or FLB, and "Parties" shall mean SCB and
FLB.
"Permit" shall mean any federal, state, local, and foreign governmental
approval, authorization, certificate, easement, filing, franchise, license,
notice, permit, or right to which any Person is a party or that is or may be
binding upon or inure to the benefit of any Person.
"Person" shall mean a natural person or any legal, commercial, or
governmental entity, such as, but not limited to, a corporation, general
partnership, joint venture, limited partnership, limited liability company,
trust, business association, group acting in concert, or any person acting in a
representative capacity.
"Registration Statement" shall mean the Registration Statement on Form
S-4, or other appropriate form, including any pre-effective or post-effective
amendments or supplements thereto, filed with the SEC by FLB under the 1933 Act
with respect to the shares of FLB Common Stock to be issued to the shareholders
of SCB in connection with the transactions contemplated by this Agreement.
"Regulatory Authorities" shall mean, collectively, the Federal Trade
Commission, the United States Department of Justice, the Board of the Governors
of the Federal Reserve System, the Office of the Comptroller of the Currency,
the Federal Deposit Insurance Corporation, the SEC, NASD, NYSE, and all state
regulatory agencies having jurisdiction over the Parties and their respective
Subsidiaries.
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"Rights" shall mean all arrangements, calls, commitments, options,
rights to subscribe to, scrip, understandings, warrants, or other binding
obligations of any character whatsoever relating to, or securities or rights
convertible into or exchangeable for, shares of the capital stock of a Person or
any contract, commitments or other arrangements by which a Person is or may be
bound to issue additional shares of its capital stock or options, warrants,
rights to purchase or acquire any additional shares of its capital stock, or
options, warrants, or rights to purchase or acquire any additional shares of its
capital stock.
"SCB" shall have the meaning set forth in the first paragraph of this
Agreement.
"SCB Benefits Plans" shall have the meaning set forth in Section
5.17(a) of this Agreement.
"SCB Common Stock" shall mean the $1.00 par value common stock of SCB.
"SCB Companies" shall mean, collectively, SCB and all SCB Subsidiaries.
"SCB Contract" shall have the meaning set forth in Section 5.16.
"SCB Disclosure Memorandum" shall mean the written information entitled
"SCB Disclosure Memorandum" delivered prior to the date of this Agreement to
FLB, and all amendments and supplements thereto occurring between the date of
this Agreement and the date of the Closing, describing in reasonable detail the
matters contained therein and, with respect to each disclosure made therein,
specifically referencing each Section of this Agreement under which such
disclosure is being made. Information disclosed with respect to one Section
shall not be deemed to be disclosed for purposes of any other Section not
specifically referenced with respect thereto.
"SCB ERISA Plan" shall have the meaning set forth in Section 5.17(a) of
this Agreement.
"SCB Financial Statements" shall mean certain financial statements of
SCB consisting of (i) the consolidated balance sheets and the related statements
of income, changes in shareholders' equity, and cash flows (including related
notes and schedules, if any) as of and for each of the three years ended
December 31, 2002, 2001 and 2000, as contained in the SCB SEC Reports, and (ii)
the consolidated balance sheets and related statements of income, changes in
shareholders' equity, and cash flows (including related notes and schedules, if
any) included in SEC Documents filed by SCB with respect to any period ended
subsequent to December 31, 2002.
"SCB Options" shall have the meaning set forth in Section 3.5(a) of
this Agreement.
"SCB SEC Reports" shall have the meaning set forth in Section 5.5(a) of
this Agreement.
"SCB Shareholders' Meeting" shall mean the meeting of the shareholders
of SCB to be held pursuant to Section 8.1 of this Agreement, including any
adjournment or adjournments thereof.
"SCB Stock Plans" shall have the meaning set forth in Section 3.5(a) of
this Agreement.
"SCB Subsidiaries" shall mean the Subsidiaries of SCB, which shall
include the SCB Subsidiaries described in Section 5.4 of this Agreement and any
corporation, bank, savings association, or other organization acquired as a
Subsidiary of SCB in the future and owned by SCB at the Effective Time.
"SEC" shall mean the Securities and Exchange Commission.
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"SEC Documents" shall mean all forms, proxy statements, registration
statements, reports, schedules, and other documents filed, or required to be
filed, by a Party or any of its Subsidiaries with any Regulatory Authority
pursuant to the Securities Laws.
"Securities Laws" shall mean the Securities Act of 1933, as amended
(the "1933 Act"), the Securities Exchange Act of 1934, as amended (the "1934
Act"), the Investment Company Act of 1940, as amended, the Investment Advisers
Act of 1940, as amended, the Trust Indenture Act of 1939, as amended, and the
rules and regulations of any Regulatory Authority promulgated thereunder.
"Subsidiaries" shall mean all those corporations, banks, associations,
or other entities of which the entity in question owns or controls 50% or more
of the outstanding equity securities either directly or through an unbroken
chain of entities as to each of which 50% or more of the outstanding equity
securities is owned directly or indirectly by its parent; provided, there shall
not be included any such entity acquired through foreclosure or any such entity
the equity securities of which are owned or controlled in a fiduciary capacity.
"Tax" or "Taxes" shall mean all federal, state, local, and foreign
taxes, charges, fees, levies, imposts, duties, or other assessments, including
income, gross receipts, excise, employment, sales, use, transfer, license,
payroll, franchise, severance, stamp, occupation, windfall profits,
environmental, federal highway use, commercial rent, customs duties, capital
stock, paid-up capital, profits, withholding, Social Security, single business
and unemployment, disability, real property, personal property, registration, ad
valorem, value added, alternative or add-on minimum, estimated, or other tax or
governmental fee of any kind whatsoever, imposed or required to be withheld by
the United States or any state, local, foreign government or subdivision or
agency thereof, including any interest, penalties or additions thereto.
"Tax Opinion" shall have the meaning set forth in Section 9.1(g) of
this Agreement.
"Taxable Period" shall mean any period prescribed by any governmental
authority, including the United States or any state, local, foreign government
or subdivision or agency thereof for which a Tax Return is required to be filed
or Tax is required to be paid.
"Tax Return" shall mean any report, return, information return, or
other information required to be supplied to a taxing authority in connection
with Taxes, including any return of an affiliated or combined or unitary group
that includes a Party or its Subsidiaries.
(b) Any singular term in this Agreement shall be deemed
to include the plural, and any plural term the singular. Whenever the words
"include," "includes," or "including" are used in this Agreement, they shall be
deemed followed by the words "without limitation."
11.2 Expenses.
(a) Except as otherwise provided in this Section 11.2 and
Section 10.2, each of FLB and SCB shall bear and pay all direct costs and
expenses incurred by it or on its behalf in connection with the transactions
contemplated hereunder, including filing, registration, and application fees,
printing fees, and fees and expenses of its own financial or other consultants,
investment bankers, accountants, and counsel, except that each of FLB and SCB
shall each bear and pay one-half of the printing costs incurred in connection
with the printing of the Registration Statement and the Joint Proxy Statement.
44
(b) Nothing contained in this Section 11.2 shall
constitute or shall be deemed to constitute an exclusive remedy or liquidated
damages for the willful breach by a Party of the terms of this Agreement or
otherwise limit the rights of the nonbreaching Party.
11.3 Brokers and Finders. Except for fees to be paid to SunTrust
Xxxxxxxx Xxxxxxxx by SCB pursuant to a letter agreement that has been heretofore
disclosed to FLB, each Party represents and warrants that no action has been
taken by it that would give rise to any valid claim against either Party for a
brokerage commission, finder's fee or other like payment with respect to the
transactions contemplated by this Agreement.
11.4 Entire Agreement. Except as otherwise expressly provided
herein, this Agreement constitutes the entire agreement between the Parties with
respect to the transactions contemplated hereunder and supersedes all prior
arrangements or understandings with respect thereto, written or oral. Other than
as provided in Section 8.14, nothing in this Agreement, expressed or implied, is
intended to confer upon any Person, other than the Parties or their respective
successors, any rights, remedies, obligations, or liabilities under or by reason
of this Agreement.
11.5 Amendments. To the extent permitted by Law, this Agreement may
be amended by a subsequent writing signed by each of the Parties upon the
approval of the Board of Directors of each of the Parties, whether before or
after shareholder approval of this Agreement has been obtained; provided, that
after any such approval by the shareholders of a Party, there shall be made no
amendment that modifies in any material respect the consideration to be received
by holders of SCB Common Stock without the further approval of such
shareholders.
11.6 Obligations of SCB and FLB. Whenever this Agreement requires
SCB or FLB to take any action, such requirement shall be deemed to include an
undertaking by such Party to cause the Subsidiaries of such Party to take such
action.
11.7 Waivers.
(a) Prior to or at the Effective Time, FLB, acting
through its Board of Directors, chief executive officer, president, or other
authorized officer, shall have the right to waive any default in the performance
of any term of this Agreement by SCB, to waive or extend the time for the
compliance or fulfillment by SCB of any and all of its obligations under this
Agreement, and to waive any or all of the conditions precedent to the
obligations of FLB under this Agreement, except any condition which, if not
satisfied, would result in the violation of any Law. No such waiver shall be
effective unless in writing signed by a duly authorized officer of FLB.
(b) Prior to or at the Effective Time, SCB, acting
through its Board of Directors, chief executive officer, president or other
authorized officer, shall have the right to waive any default in the performance
of any term of this Agreement by FLB, to waive or extend the time for the
compliance or fulfillment by FLB of any and all of its obligations under this
Agreement, and to waive any or all of the conditions precedent to the
obligations of SCB under this Agreement, except any condition which, if not
satisfied, would result in the violation of any Law. No such waiver shall be
effective unless in writing signed by a duly authorized officer of SCB.
(c) The failure of any Party at any time or times to
require performance of any provision hereof shall in no manner affect the right
of such Party at a later time to enforce the same or any other provision of this
Agreement. No waiver of any condition or of the breach of any term contained in
this Agreement in one or more instances shall be deemed to be or construed as a
further or continuing
45
waiver of such condition or breach or a waiver of any other condition or of the
breach of any other term of this Agreement.
11.8 Assignment. Except as expressly contemplated hereby, neither
this Agreement nor any of the rights, interests, or obligations hereunder shall
be assigned by any Party hereto (whether by operation of Law or otherwise)
without the prior written consent of the other Party. Subject to the preceding
sentence, this Agreement will be binding upon, inure to the benefit of, and be
enforceable by the Parties and their respective successors and assigns.
11.9 Notices. All notices or other communications which are
required or permitted hereunder shall be in writing and sufficient if delivered
by hand, by facsimile transmission, by registered or certified mail, postage
pre-paid, or by courier or overnight carrier, to the persons at the addresses
set forth below (or at such other address as may be provided hereunder), and
shall be deemed to have been delivered as of the date so delivered:
SCB: Southern Community Bancorp
000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000
Telecopy Number: (000) 000-0000
Attention: Chairman and Chief Executive Officer
Copy to Counsel: Xxxxxx & Xxxxx LLP
000 X. Xxxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, XX 00000
Telecopy Number: (000) 000-0000
Attention: Xxx X. Xxxxx, Esq.
FLB: First National Bankshares of Florida, Inc.
0000 Xxxxxxxxx Xxxx Xxxxx
Xxxxxx, Xxxxxxx 00000
Telecopy Number: 000-000-0000
Attention: Chairman and Chief Executive Officer
Copy to Counsel: Xxxxx, Xxxxxxxx & Xxxxxxx, LLP
0000 Xxxxxxxxx Xxxx, XX
Xxxxx 0000, Promenade II
Xxxxxxx, Xxxxxxx 00000
Telecopy Number: 000-000-0000
Attention: Xxxxxx X. Xxxxxxxx, Esq.
11.10 Governing Law. This Agreement shall be governed by and
construed in accordance with the Laws of the State of Florida, without regard to
any applicable conflicts of Laws.
11.11 Counterparts. This Agreement may be executed in counterparts,
each of which shall be deemed to be an original, but both of which together
shall constitute one and the same instrument.
11.12 Captions. The captions contained in this Agreement are for
reference purposes only and are not part of this Agreement.
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11.13 Enforcement of Agreement. The Parties hereto agree that
irreparable damage would occur in the event that any of the provisions of this
Agreement was not performed in accordance with its specific terms or was
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 in any court of the United
States or any state having jurisdiction, this being in addition to any other
remedy to which they are entitled at law or in equity.
11.14 Severability. Any term or provision of this Agreement which is
invalid or unenforceable in any jurisdiction shall, as to that jurisdiction, be
ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining terms and provisions of this
Agreement or affecting the validity or enforceability of any of the terms or
provisions of this Agreement in any other jurisdiction. If any provision of this
Agreement is so broad as to be unenforceable, the provision shall be interpreted
to be only so broad as is enforceable.
[Remainder of this Page Intentionally Left Blank]
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IN WITNESS WHEREOF, each of the Parties has caused this Agreement to be
executed on its behalf by its duly authorized officer as of the day and year
first above written.
FIRST NATIONAL BANKSHARES OF FLORIDA, INC.
By: /s/ Xxxx X. Xxxx
-----------------------------------------------
Xxxx X. Xxxx
Chairman and Chief Executive Officer
SOUTHERN COMMUNITY BANCORP
By: /s/ Xxxxxxx X. Xxxxxxxx, Xx.
-----------------------------------------------
Xxxxxxx X. Xxxxxxxx, Xx.
Chairman and Chief Executive Officer
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