Exhibit 99.1
AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER, dated as of November 22, 1999 ("Agreement"),
by and among First Place Financial Corp., a Delaware corporation ("Buyer"),
First Federal Savings and Loan Association of Xxxxxx, a federally chartered
savings and loan association (the "Association") and a wholly-owned subsidiary
of Buyer, and Ravenna Savings Bank, an Ohio-chartered savings bank ("Ravenna").
WHEREAS, the Boards of Directors of each of Buyer, the Association and
Ravenna (i) have determined that it is in the best interests of their respective
companies and their shareholders to consummate the business combination
transaction provided for herein in which Ravenna will, subject to the terms and
conditions set forth herein, merge (the "Merger") with and into the Association,
(ii) have determined that this Agreement and the transactions contemplated
hereby are consistent with, and in furtherance of, its respective business
strategies and (iii) have approved, at meetings of each such Board of Directors,
this Agreement.
WHEREAS, the parties desire to make certain representations, warranties and
agreements in connection with the Merger and also to prescribe certain
conditions to the Merger.
NOW, THEREFORE, in consideration of the mutual covenants, representations,
warranties and agreements contained herein, and intending to be legally bound
hereby, the parties agree as follows:
ARTICLE I
THE MERGER
1.1 The Merger. At the Effective Time (as defined in Section 1.2 hereof),
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Ravenna shall merge with and into the Association in accordance with the
provisions of, and with the effect provided in, the rules and regulations (the
"OTS Regulations") of the Office of Thrift Supervision (the "OTS") and Title XI
of the Ohio Revised Code (the "Ohio Code") and pursuant to the terms and
conditions of an agreement and plan of merger to be entered into between the
Association and Ravenna consistent with the terms of this Agreement and in a
form to be mutually agreed upon. The Association shall be the surviving entity
(hereinafter sometimes called the "Surviving Entity") in the Merger, and shall
continue its existence under the laws of the United States of America. The name
of the Surviving Entity shall be First Federal Savings and Loan Association of
Xxxxxx, or such other name as may be determined by the Buyer. Upon consummation
of the Merger, the separate corporate existence of Ravenna shall terminate.
1.2. Effective Time. The Merger shall become effective as set forth in the
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articles of combination (the "Articles of Combination") which shall be filed
with appropriate authorities (the "Authorities") on the Closing Date (as defined
in Section 9.1 hereof). The term "Effective Time" shall be the date and time
when the Merger becomes effective, as set forth in the Articles of Combination.
1.3 Effects of the Merger. At and after the Effective Time, the Merger
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shall have the effects set forth in Section 552.13 of the OTS Regulations and
Section 1701.82 of the Ohio Code.
1.4 Conversion of Ravenna Common Stock.
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(a) At the Effective Time, subject to Section 2.2(e) hereof, each share of
the common stock, par value $100 per share, of Ravenna (the "Ravenna Common
Stock") issued and outstanding immediately prior to the Effective Time (other
than shares of Ravenna Common Stock held (x) by a holder (the "Dissenting
Stockholder"), pursuant to any applicable law providing for dissenters' or
appraisal rights is entitled to receive payment in accordance with the
provisions of any such law, such holder to have only the rights provided in any
such law (the "Dissenters' Shares") (y) in Ravenna's treasury or (z) directly or
indirectly by Buyer, the Association or Ravenna or any of their respective
Subsidiaries (as defined below) (except for Trust Account Shares and DPC shares,
as such terms are defined in Section 1.4 (b) hereof)) shall, by virtue of this
Agreement and without any action on the part of the holder thereof, be converted
into and exchangeable for 2,033 shares (the "Exchange Ratio") of common stock,
par value $0.01 per share, of Buyer ("Buyer Common Stock"). All of the shares of
Ravenna Common Stock converted into Buyer Common Stock pursuant to this Article
I shall no longer be outstanding and shall automatically be cancelled and shall
cease to exist, and each certificate (each a "Certificate") previously
representing any such shares of Ravenna Common Stock shall thereafter only
represent the right to receive (i) the number of whole shares of Buyer Common
Stock and (ii) the cash in lieu of fractional shares into which the shares of
Ravenna Common Stock represented by such Certificate have been converted
pursuant to this Section 1.4(a) and Section 2.2(e) hereof. Certificates
previously representing shares of Ravenna Common Stock shall be exchanged for
certificates representing whole shares of Buyer Common Stock and cash in lieu of
fractional shares issued in consideration therefor upon the surrender of such
Certificates in accordance with Section 2.2 hereof, without any interest
thereon. If prior to the Effective Time Buyer should split or combine its common
stock, or pay a dividend or other distribution in such common stock, then the
Exchange Ratio shall be appropriately adjusted to reflect such split,
combination, dividend or distribution.
(b) At the Effective Time, all shares of Ravenna Common Stock that are
owned by Ravenna as treasury stock and all shares of Ravenna Common Stock that
are owned directly or indirectly by Buyer or Ravenna or any of their respective
Subsidiaries (other than shares of Ravenna Common Stock (x) held directly or
indirectly in trust accounts, managed accounts and the like or otherwise held in
a fiduciary capacity that are beneficially owned by third parties (any such
shares, and shares of Buyer Common Stock which are similarly held, whether held
directly or indirectly by Buyer or Ravenna, as the case may be, being referred
to herein as "Trust Account Shares") and (y) shares of Ravenna Common Stock held
by Buyer or Ravenna or any of their respective Subsidiaries in respect of a debt
previously contracted (any such shares of Ravenna Common Stock, and shares of
Buyer Common Stock which are similarly held, whether held directly or indirectly
by Buyer or Ravenna being referred to herein as "DPC Shares")) shall be
cancelled and shall cease to exist and no stock of Buyer or other consideration
shall be delivered in exchange therefor. All shares of Buyer Common Stock that
are owned by Ravenna or its Subsidiary (other than Trust Account Shares and DPC
Shares) shall become treasury stock of Buyer.
1.5 Stock Options.
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(a) At the Effective Time, all options granted by Ravenna under the
Ravenna 1998 Key Employee Stock Option Plan (the "Ravenna Option Plan")
("Ravenna Options") to purchase shares of Ravenna Common Stock which are
outstanding and unexercised immediately prior thereto shall be converted, in
their entirety, automatically into options to purchase shares of Buyer Common
Stock in an amount and at an exercise price determined as provided below:
(1) The number of shares of Buyer Common Stock to be subject to the
new options shall be equal to the product of the number of shares of
Ravenna Common Stock subject to the original options and the Exchange
Ratio, provided that any fractional shares of Buyer Common Stock resulting
from such multiplication shall be rounded down to the nearest share; and
(2) The exercise price per share of the Buyer Common Stock under
the new options shall be equal to the exercise price per share of Ravenna
Common Stock under the original option divided by the Exchange Ratio,
provided that such exercise price shall be rounded up to the nearest cent.
The adjustment provided herein with respect to any options which are "incentive
stock options" (as defined in Section 422 of the Internal Revenue Code of 1986,
as amended (the "Code")) shall be and is intended to be effected in a manner
which is consistent with Section 424(a) of the Code. The duration and other
terms of the new option shall be the same as the original option, except that
all references to Ravenna shall be deemed to be references to Buyer.
(b) It is understood that the holder of a Ravenna Option may exercise such
options, in accordance with the terms of the option, and applicable regulations,
prior to the Effective Time.
1.6 Buyer Common Stock. Except for shares of Buyer Common Stock owned by
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Ravenna or its Subsidiary (other than Trust Account Shares and DPC Shares),
which shall be converted into treasury stock of Buyer as contemplated by Section
1.4 hereof, the shares of Buyer Common Stock issued and outstanding immediately
prior to the Effective Time shall be unaffected by the Merger and at the
Effective Time, such shares shall remain issued and outstanding.
1.7 Charter. At the Effective Time, the Charter of the Association, as in
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effect at the Effective Time, shall be the Charter of the Surviving Entity.
1.8 By-Laws. At the Effective Time, the By-Laws of the Association, as in
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effect immediately prior to the Effective Time, shall be the By-Laws of the
Surviving Entity.
1.9 Directors and Officers. Except as provided in Section 6.13 hereof,
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the directors and officers of the Association immediately prior to the Effective
Time shall be the directors and officers of the Surviving Entity, each to hold
office in accordance with the Charter and By-Laws of the Surviving Entity until
their respective successors are duly elected or appointed and qualified.
1.10 Tax Consequences. It is intended that the Merger constitute a
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reorganization within the meaning of Section 368(a) of the Code, and that this
Agreement shall constitute a "plan of reorganization" for the purposes of
Section 368 of the Code.
1.11 Dissenters' Rights.
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(a) Any Dissenting Stockholder who shall be entitled to
dissenters' rights with respect to his or her Dissenters' Shares, as provided in
Section 1701.85 of the Ohio Code, shall not be entitled to the merger
consideration under Section 1.4 of this Agreement, unless and until the holder
thereof shall have failed to perfect or shall have effectively withdrawn or lost
such holder's right to dissent from the Merger under such law, and shall be
entitled to receive only the payment to the extent provided for therein with
respect to such Dissenters' Shares.
(b) Ravenna shall (i) give Buyer prompt written notice of the
receipt of any notice from a stockholder purporting to exercise any dissenters'
rights, (ii) not settle or offer to settle any demand for payment without the
prior written consent of the Buyer and (iii) not waive any failure to comply
strictly with any procedural requirements of Section 1701.85 of the Ohio Code.
ARTICLE II
EXCHANGE OF SHARES
2.1 Buyer to Make Shares Available. At or prior to the Effective Time,
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Buyer shall deposit, or shall cause to be deposited, with a bank or trust
company (which may be a Subsidiary of Buyer) (the "Exchange Agent"), selected by
Buyer and reasonably satisfactory to Ravenna, for the benefit of the holders of
Certificates, for exchange in accordance with this Article II, certificates
representing the shares of Buyer Common Stock and the cash in lieu of fractional
shares (such cash and certificates for shares of Buyer Common Stock, together
with any dividends or distributions with respect thereto, being hereinafter
referred to as the "Exchange Fund") to be issued pursuant to Section 1.4 and
paid pursuant to Section 2.2(a) in exchange for outstanding shares of Ravenna
Common Stock.
2.2 Exchange of Shares.
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(a) As soon as practicable after the Effective Time, and in no event more
than five business days thereafter, the Exchange Agent shall mail to each holder
of record of a Certificate or Certificates a form letter of transmittal (which
shall specify that delivery shall be effected, and risk of loss and title to the
Certificates shall pass, only upon delivery of the Certificates to the Exchange
Agent) and instructions for use in effecting the surrender of the Certificates
in exchange for certificates representing the shares of Buyer Common Stock and
the cash in lieu of fractional shares into which the shares of Ravenna Common
Stock represented by such Certificate or Certificates shall have been converted
pursuant to this Agreement. Upon surrender of a Certificate for exchange and
cancellation to the Exchange Agent, together with such letter of transmittal,
duly executed, the holder of such Certificate shall be entitled to receive in
exchange therefor (x) a certificate representing that number of whole shares of
Buyer Common Stock to
which such holder of Ravenna Common Stock shall have become entitled pursuant to
the provisions of Article I hereof and (y) a check representing the amount of
cash in lieu of fractional shares, if any, which such holder has the right to
receive in respect of the Certificate surrendered pursuant to the provisions of
this Article II, and the Certificate so surrendered shall forthwith be
cancelled. No interest will be paid or accrued on the cash in lieu of fractional
shares and unpaid dividends and distributions, if any, payable to holders of
Certificates.
(b) No dividends or other distributions declared after the Effective Time
with respect to Buyer Common Stock and payable to the holders of record thereof
shall be paid to the holder of any unsurrendered Certificate until the holder
thereof shall surrender such Certificate in accordance with this Article II.
After the surrender of a Certificate in accordance with this Article II, the
record holder thereof shall be entitled to receive any such dividends or other
distributions, without any interest thereon, which theretofore had become
payable with respect to shares of Buyer Common Stock represented by such
Certificate. No holder of an unsurrendered Certificate shall be entitled, until
the surrender of such Certificate, to vote the shares of Buyer Common Stock into
which his Ravenna Common Stock shall have been converted.
(c) If any certificate representing shares of Buyer Common Stock is to be
issued in a name other than that in which the Certificate surrendered in
exchange therefor is registered, it shall be a condition of the issuance thereof
that the Certificate so surrendered shall be properly endorsed (or accompanied
by an appropriate instrument of transfer) and otherwise in proper form for
transfer, and that the person requesting such exchange shall pay to the Exchange
Agent in advance any transfer or other taxes required by reason of the issuance
of a certificate representing shares of Buyer Common Stock in any name other
than that of the registered holder of the Certificate surrendered, or required
for any other reason, or shall establish to the satisfaction of the Exchange
Agent that such tax has been paid or is not payable.
(d) After the Effective Time, there shall be no transfers on the stock
transfer books of Ravenna of the shares of Ravenna Common Stock which were
issued and outstanding immediately prior to the Effective Time. If, after the
Effective Time, Certificates representing such shares are presented for transfer
to the Exchange Agent, they shall be cancelled and exchanged for certificates
representing shares of Buyer Common Stock as provided in this Article II.
(e) Notwithstanding anything to the contrary contained herein, no
certificates or scrip representing fractional shares of Buyer Common Stock shall
be issued upon the surrender for exchange of Certificates, no dividend or
distribution with respect to Buyer Common Stock shall be payable on or with
respect to any fractional share, and such fractional share interests shall not
entitle the owner thereof to vote or to any other rights of a shareholder of
Buyer. In lieu of the issuance of any such fractional share, Buyer shall pay to
each former stockholder of Ravenna who otherwise would be entitled to receive a
fractional share of Buyer Common Stock an amount in cash determined by
multiplying (i) the product of the Average Closing Price and the Exchange Ratio
by (ii) the fraction of a share of Buyer Common Stock to which such holder would
otherwise be entitled to receive pursuant to Section 1.4 hereof.
(f) Any portion of the Exchange Fund that remains unclaimed by the
stockholders of Ravenna for six months after the Effective Time shall be paid to
Buyer.
Any stockholders of Ravenna who have not theretofore complied with this Article
II shall thereafter look only to Buyer for payment of their shares of Buyer
Common Stock, cash in lieu of fractional shares and unpaid dividends and
distributions on the Buyer Common Stock deliverable in respect of each share of
Ravenna Common Stock such stockholder holds as determined pursuant to this
Agreement, in each case, without any interest thereon. Notwithstanding the
foregoing, none of Buyer, Ravenna, the Exchange Agent or any other person shall
be liable to any former holder of shares of Ravenna Common Stock for any amount
properly delivered to a public official pursuant to applicable abandoned
property, escheat or similar laws.
(g) 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 the posting by such person
of a bond in such amount as Buyer may direct 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
Buyer Common Stock and cash in lieu of fractional shares deliverable in respect
thereof pursuant to this Agreement.
(h) Buyer and the Exchange Agent shall be entitled to rely upon Ravenna's
stock transfer books to establish the identity of those persons entitled to
receive Buyer Common Stock pursuant to Article I, which books shall be
conclusive with respect thereto. In the event of a dispute with respect to
ownership of stock represented by a Certificate, Buyer and the Exchange Agent
shall be entitled to deposit any consideration represented thereby in escrow
with an independent third party and thereafter be relieved with respect to any
claims thereto.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF RAVENNA
Ravenna hereby represents and warrants to Buyer as follows:
3.1 Organization.
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(a) Ravenna is a savings bank duly organized, validly existing and in good
standing under the laws of the State of Ohio. The deposit accounts of Ravenna
are insured by the Federal Deposit Insurance Corporation (the "FDIC") through
the Savings Association Insurance Fund ("SAIF") to the fullest extent permitted
by law, and all premiums and assessments required to be paid in connection
therewith have been paid when due by Ravenna. Ravenna's Subsidiary is a
corporation duly organized, validly existing and in good standing under the laws
of its jurisdiction of incorporation or organization. Each of Ravenna and its
Subsidiary has the corporate power and authority to own or lease all of its
properties and assets and to carry on its business as it is now being conducted
and is duly licensed or qualified to do business in each jurisdiction in which
the nature of the business conducted by it or the character or the location of
the properties and assets owned or leased by it makes such licensing or
qualification necessary, except where the failure to be so licensed or qualified
would not have a Material Adverse Effect on Ravenna or its Subsidiary. The
Amended Articles of Incorporation, Constitution and Bylaws of Ravenna, and the
articles of incorporation, by-laws and similar governing documents of its
Subsidiary, copies of which have
previously been delivered to Buyer, are true, complete and correct copies of
such documents as in effect as of the date of this Agreement. As used in this
Agreement, the term "Material Adverse Effect" means, with respect to Buyer,
Ravenna or the Surviving Entity, as the case may be, a material adverse effect
on the business, properties, assets, liabilities, results of operations or
financial condition of such party and its Subsidiaries taken as a whole, other
than any such effect attributable to or resulting from general economic
conditions. As used in this Agreement, the word "Subsidiary" when used with
respect to any party means any corporation, partnership or other organization,
whether incorporated or unincorporated, which is consolidated with such party
for financial reporting purposes.
(b) The minute books of Ravenna and its Subsidiary contain true, complete
and accurate records in all material respects of all meetings and other
corporate actions held or taken since December 31, 1994 of their respective
stockholders and Boards of Directors (including committees of their respective
Boards of Directors).
3.2 Capitalization.
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(a) The authorized capital stock of Ravenna consists of 5,000 shares of
Ravenna Common Stock. As of the date of this Agreement, there are (x) 1,000
shares of Ravenna Common Stock issued and outstanding and no shares of Ravenna
Common Stock held in Ravenna's treasury and (y) no shares of Ravenna Common
Stock reserved for issuance upon exercise of outstanding stock options or
otherwise except for 30 shares of Ravenna Common Stock reserved for issuance
pursuant to the Ravenna Option Plan and described in Section 3.2(a) of the
Disclosure Schedule which is being delivered to Buyer concurrently herewith (the
"Ravenna Disclosure Schedule"). All of the issued and outstanding shares of
Ravenna Common Stock are owned by the persons identified on Section 3.2(a)(i) of
the Ravenna Disclosure Schedule. All of the issued and outstanding shares of
Ravenna Common Stock have been duly authorized and validly issued and are fully
paid, nonassessable and free of preemptive rights. Except as referred to above
or reflected in Section 3.2(a)(ii) of the Ravenna Disclosure Schedule, Ravenna
does not have and is not bound by any outstanding subscriptions, options,
warrants, calls, commitments or agreements of any character calling for the
purchase or issuance of any shares of Ravenna Common Stock or any other equity
security of Ravenna or any securities representing the right to purchase or
otherwise receive any shares of Ravenna Common Stock or any other equity
security of Ravenna. The names of the optionees, the date of each option to
purchase Ravenna Common Stock granted, the number of shares subject to each such
option, the expiration date of each such option, and the price at which each
such option may be exercised under the Option Plan are set forth in Section
3.2(a) of the Ravenna Disclosure Schedule. As of the date hereof, there are no
outstanding contractual obligations of Ravenna or its Subsidiary to repurchase,
redeem or otherwise acquire any shares of capital stock of Ravenna or its
Subsidiary.
(b) Section 3.2(b) of the Ravenna Disclosure Schedule sets forth a true
and correct list of all of the Subsidiaries of Ravenna as of the date of this
Agreement. Except as set forth in Section 3.2(b) of the Ravenna Disclosure
Schedule, Ravenna owns, directly or indirectly, all of the issued and
outstanding shares of the capital stock of such Subsidiary, free and clear of
all liens, charges, encumbrances and security interests whatsoever, and all of
such shares are duly authorized and validly issued and are fully paid,
nonassessable and free of preemptive rights. No Subsidiary of Ravenna has or is
bound by any outstanding subscriptions, options, warrants, calls, commitments or
agreements of any character calling for the purchase or issuance of any shares
of capital stock or any other equity security of such Subsidiary or any
securities representing the right to purchase or otherwise receive any shares of
capital stock or any other equity security of such Subsidiary. Assuming
compliance by Buyer with Section 1.5 hereof, at the Effective Time, there will
not be any outstanding subscriptions, options, warrants, calls, commitments or
agreements of any character by which Ravenna or its Subsidiary will be bound
calling for the purchase or issuance of any shares of the capital stock of
Ravenna or its Subsidiary.
3.3 Authority; No Violation.
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(a) Ravenna has full corporate power and authority to execute and deliver
this Agreement and to consummate the transactions contemplated hereby. The
execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby have been duly and validly approved by the
Board of Directors of Ravenna. The Board of Directors of Ravenna has directed
that this Agreement and the transactions contemplated hereby be submitted to
Ravenna's stockholders for approval at a meeting of such stockholders and,
except for the adoption of this Agreement by the requisite vote of Ravenna's
stockholders, no other corporate proceedings (except for regulatory approvals)
on the part of Ravenna are necessary to approve this Agreement and to consummate
the transactions contemplated hereby. This Agreement has been duly and validly
executed and delivered by Ravenna and (assuming due authorization, execution and
delivery by Buyer) constitutes a valid and binding obligation of Ravenna,
enforceable against Ravenna in accordance with its terms, except as enforcement
may be limited by general principles of equity whether applied in a court of law
or a court of equity and by bankruptcy, insolvency and similar laws affecting
creditors' rights and remedies generally.
(b) Except as set forth in Section 3.3(b) of the Ravenna Disclosure
Schedule, neither the execution and delivery of this Agreement by Ravenna, nor
the consummation by Ravenna of the transactions contemplated hereby, nor
compliance by Ravenna with any of the terms or provisions hereof will (i)
violate any provision of the Articles of Incorporation, Constitution or By-Laws
of Ravenna or the articles of incorporation, by-laws or similar governing
documents of its Subsidiary, or (ii) assuming that the consents and approvals
referred to in Section 3.4 hereof are duly obtained, (x) violate any statute,
code, ordinance, rule, regulation, judgment, order, writ, decree or injunction
applicable to Ravenna or its Subsidiary, or any of their respective properties
or assets, or (y) violate, conflict with, result in a breach of any provision of
or the loss of any benefit under, constitute a default (or an event which, with
notice or lapse of time, or both, would constitute a default) under, result in
the termination of or a right of termination or cancellation under, accelerate
the performance required by, or result in the creation of any lien, pledge,
security interest, charge or other encumbrance upon any of the respective
properties or assets of Ravenna or its Subsidiary under any of the terms,
conditions or provisions of any note, bond, mortgage, indenture, deed of trust,
license, lease, agreement or other instrument or obligation to which Ravenna or
its Subsidiary is a party, or by which they or any of their respective
properties or assets may be bound or affected, except (in the case of clause (y)
above) for such violations, conflicts, breaches or defaults which, either
individually or in the aggregate, would not have or be reasonably likely to have
a Material Adverse Effect on Ravenna.
3.4 Consents and Approvals. Except for (a) the filing of applications
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with the Office of Thrift Supervision (the "OTS") and, if necessary, the Federal
Deposit Insurance Corporation ("FDIC") and approval of such applications, (b)
the filing of an application with the Ohio Division of Financial Institutions
(the "Division") and approval of such application, (c) the approval of this
Agreement by the requisite vote of the stockholders of Ravenna, (d) the filing
of the Certificate of Merger with the Secretary of State of the State of Ohio
pursuant to the Ohio Act, and (e) such filings, authorizations or approvals as
may be set forth in Section 3.4 of the Ravenna Disclosure Schedule, no consents
or approvals of or filings or registrations with any court, administrative
agency or commission or other governmental authority or instrumentality (each a
"Governmental Entity") or with any third party are necessary in connection with
(1) the execution and delivery by Ravenna of this Agreement and (2) the
consummation by Ravenna of the Merger and the other transactions contemplated
hereby.
3.5 Reports. Ravenna and its Subsidiary have timely filed all material
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reports, registrations and statements, together with any amendments required to
be made with respect thereto, that they were required to file since December 31,
1995 with (i) the Division, (ii) the FDIC, (iii) any other state regulatory
authority (each a "State Regulator") and (iv) any other self-regulatory
organization ("SRO") (collectively, the "Regulatory Agencies"), and all other
material reports and statements required to be filed by them since December 31,
1995, including, without limitation, any report or statement required to be
filed pursuant to the laws, rules or regulations of the United States, the State
of Ohio, the Division, the FDIC, any State Regulator or any SRO, and have paid
all fees and assessments due and payable in connection therewith. Except for
normal examinations conducted by a Regulatory Agency in the regular course of
the business of Ravenna and its Subsidiary, except as set forth in Section 3.5
of the Ravenna Disclosure Schedule, no Regulatory Agency has initiated any
proceeding or, to the best knowledge of Ravenna, investigation into the business
or operations of Ravenna or its Subsidiary since December 31, 1995. There is no
unresolved material violation, criticism, or exception by any Regulatory Agency
with respect to any report or statement relating to any examinations of Ravenna
or its Subsidiary.
3.6 Financial Statements. Ravenna has previously delivered to Buyer
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copies of (a) the consolidated balance sheets of Ravenna and its Subsidiary as
of June 30 for the fiscal years 1996, 1997, 1998 and 1999, and the related
consolidated statements of income, changes in stockholders' equity and cash
flows for the fiscal years 1995 through 1999, inclusive, in each case
accompanied by the audit report of KPMG Peat Marwick LLP, independent public
accountants with respect to Ravenna, and (b) the unaudited consolidated balance
sheets of Ravenna and its Subsidiary as of September 30, 1999 and September 30,
1998 and the related unaudited consolidated statements of income, cash flows and
changes in stockholders' equity for the three month periods then ended. The
September 30, 1999 consolidated balance sheet of Ravenna (including the related
notes, where applicable) fairly presents the consolidated financial position of
Ravenna and its Subsidiary as of the date thereof, and the other financial
statements referred to in this Section 3.6 (including the related notes, where
applicable) fairly present, and the financial statements referred to in Section
6.9 hereof will fairly present (subject, in the case of the unaudited
statements, to recurring audit adjustments normal in nature and amount), the
results of the consolidated operations and consolidated financial position of
Ravenna and its Subsidiary for the respective fiscal periods or as of the
respective dates therein set forth; each of such statements (including the
related notes, where applicable) comply, and the financial statements referred
to in Section 6.9 hereof will comply, in all
material respects with generally accepted accounting principles ("GAAP"); and
each of such statements (including the related notes, where applicable) has
been, and the financial statements referred to in Section 6.9 hereof will be,
prepared in accordance with GAAP consistently applied during the periods
involved, except as indicated in the notes thereto. The financial books and
records of Ravenna and its Subsidiary have been, and are being, maintained in
all material respects in accordance with GAAP.
3.7 Broker's Fees. Neither Ravenna nor its Subsidiary nor any of their
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respective officers or directors has employed any broker or finder or incurred
any liability for any broker's fees, commissions or finder's fees in connection
with any of the transactions contemplated by this Agreement, except that Ravenna
has engaged, and will pay a fee or commission to, McDonald Investments, Inc.
("McDonald") in accordance with the terms of a letter agreement between McDonald
and Ravenna concerning the retention of McDonald to act as financial advisor to
Ravenna and concerning issuance of an opinion regarding the fairness of the
Exchange Ratio, a true, complete and correct copy of which has been previously
delivered by Ravenna to Buyer.
3.8 Absence of Certain Changes or Events.
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(a) Except as may be set forth in Section 3.8(a) of the Ravenna Disclosure
Schedule, since June 30, 1999, (i) neither Ravenna nor its Subsidiary has
incurred any material liability, except in the ordinary course of their business
consistent with their past practices, and (ii) to Ravenna's knowledge, no event
has occurred which has caused, or is reasonably likely to cause, individually or
in the aggregate, a Material Adverse Effect on Ravenna.
(b) Except as set forth in Section 3.8(b) of Ravenna Disclosure Schedule,
since June 30, 1999, Ravenna and its Subsidiary have carried on their respective
businesses in the ordinary course consistent with their past practices.
(c) Except as set forth in Section 3.8(c) of the Ravenna Disclosure
Schedule, since June 30, 1999, neither Ravenna nor its Subsidiary has (i)
increased the wages, salaries, compensation, pension, or other fringe benefits
or perquisites payable to any executive officer, employee, or director from the
amount thereof in effect as of June 30, 1999 (which amounts have been previously
disclosed to Buyer), granted any severance or termination pay, entered into any
contract to make or grant any severance or termination pay, or paid any bonus
other than year-end bonuses for fiscal 1999 as listed in Section 3.8 of the
Ravenna Disclosure Schedule or (ii) suffered any strike, work stoppage, slow-
down, or other labor disturbance.
3.9 Legal Proceedings.
-----------------
(a) Except as set forth in Section 3.9 of the Ravenna Disclosure Schedule,
neither Ravenna nor its Subsidiary is a party to any, and there are no pending
or, to the best of Ravenna's knowledge, threatened, legal, administrative,
arbitral or other proceedings, claims, actions or governmental or regulatory
investigations of any nature against Ravenna or its Subsidiary or challenging
the validity or propriety of the transactions contemplated by this Agreement as
to which there is a reasonable probability of an adverse determination and
which, if adversely determined, would, individually or in the aggregate, have or
be reasonably likely to have a Material Adverse Effect on Ravenna.
(b) There is no injunction, order, judgment, decree, or regulatory
restriction imposed upon Ravenna, its Subsidiary or the assets of Ravenna or its
Subsidiary which has had, or could reasonably be expected to have, a Material
Adverse Effect on Ravenna.
3.10 Taxes.
-----
(a) Except as set forth in Section 3.10(a) of the Ravenna Disclosure
Schedule, each of Ravenna and its Subsidiary has (i) duly and timely filed or
will duly and timely file (including applicable extensions granted without
penalty) all Tax Returns (as hereinafter defined) required to be filed at or
prior to the Effective Time, and such Tax Returns which have heretofore been
filed are, and those to be hereinafter filed will be, true, correct and complete
and (ii) paid in full or have made adequate provision for on the financial
statements of Ravenna (in accordance with GAAP) all Taxes (as hereinafter
defined) that are due on or prior to the Effective Time and will pay in full or
make adequate provision for all such Taxes, except where the failure to do any
of the foregoing would not have a Material Adverse Effect on Ravenna or its
Subsidiary. There are no material liens for Taxes upon the assets of either
Ravenna or its Subsidiary except for statutory liens for current Taxes not yet
due. Except as set forth in Section 3.10(a) of the Ravenna Disclosure Schedule,
neither Ravenna nor its Subsidiary has requested any extension of time within
which to file any Tax Returns in respect of any fiscal year which have not since
been filed and no request for waivers of the time to assess any Taxes are
pending or outstanding. The federal and state income Tax Returns of Ravenna and
its Subsidiary have been audited by the Internal Revenue Service or appropriate
state tax authorities with respect to those periods and jurisdictions set forth
on Section 3.10(a) of the Ravenna Disclosure Schedule. Except as set forth in
Section 3.10(a) of the Ravenna Disclosure Schedule, neither Ravenna nor its
Subsidiary (i) is a party to any agreement providing for the allocation or
sharing of Taxes (other than the allocation of federal income taxes as provided
by Regulation 1.1552-1(a)(l) under the Code; (ii) is required to include in
income any adjustment pursuant to Section 481(a) of the Code, by reason of the
voluntary change in accounting method (nor has any taxing authority proposed in
writing any such adjustment or change of accounting method); or (iii) has filed
a consent pursuant to Section 341(f) of the Code.
(b) For the purposes of this Agreement, "Taxes" shall mean all taxes,
charges, fees, levies, penalties or other assessments imposed by any United
States federal, state, local or foreign taxing authority, including, but not
limited to income, excise, property, sales, transfer, franchise, payroll,
withholding, social security or other taxes, including any interest, penalties
or additions attributable thereto.
(c) For purposes of this Agreement, "Tax Return" shall mean any return,
report, information return or other document (including any related or
supporting information) with respect to Taxes.
3.11 Employees.
---------
(a) Section 3.11(a) of the Ravenna Disclosure Schedule sets forth a true
and complete list of each employee benefit plan, arrangement or agreement that
is maintained or contributed to or required to be contributed to as of the date
of this Agreement (the "Plans") by Ravenna, its Subsidiary or by any trade or
business, whether or not incorporated (an "ERISA Affiliate"), all of which
together with Ravenna would be deemed a "single employer" within the meaning of
Section 4001 of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA"), for the benefit of
any employee or former employee of Ravenna, its Subsidiary or any ERISA
Affiliate.
(b) Ravenna has heretofore delivered to Buyer true and complete copies of
each of the Plans, the summary plan descriptions, the Form 5500s for the last
two years, and (i) the actuarial report for any Plan (if applicable) for each of
the last two years, and (ii) the most recent determination letter from the
Internal Revenue Service (if applicable) for any Plan.
(c) Except as set forth in Section 3.11(c) of the Ravenna Disclosure
Schedule, (i) each of the Plans has been operated and administered in all
material respects in accordance with its terms and applicable law, including but
not limited to ERISA and the Code, (ii) each of the Plans intended to be
"qualified" within the meaning of Section 401(a) of the Code either (1) has
received a favorable determination letter from the IRS, or (2) is or will be the
subject of an application for a favorable determination letter, and Ravenna is
not aware of any circumstances likely to result in the revocation or denial of
any such favorable determination letter, (iii) with respect to each Plan which
is subject to Title IV of ERISA, the present value of accrued benefits under
such Plan, based upon the actuarial assumptions used for funding purposes in the
most recent actuarial report prepared by such Plan's actuary with respect to
such Plan, did not, as of its latest valuation date, exceed the then current
value of the assets of such Plan allocable to such accrued benefits, (iv) except
as disclosed under Section 3.29 of this Agreement, no Plan provides benefits,
including without limitation death or medical benefits (whether or not insured),
with respect to current or former employees of Ravenna, its Subsidiary or any
ERISA Affiliate beyond their retirement or other termination of service, other
than (w) coverage mandated by applicable law, (x) death benefits or retirement
benefits under any "employee pension plan," as that term is defined in Section
3(2) of ERISA, (y) deferred compensation benefits accrued as liabilities on the
books of Ravenna, its Subsidiary or the ERISA Affiliates or (z) benefits the
full cost of which is borne by the current or former employee (or his
beneficiary), (v) no liability under Title IV of ERISA has been incurred by
Ravenna, its Subsidiary or any ERISA Affiliate that has not been satisfied in
full, and no condition exists that presents a material risk to Ravenna, its
Subsidiary or an ERISA Affiliate of incurring a material liability thereunder,
(vi) no Plan is a "multiemployer pension plan," as such term is defined in
Section 3(37) of ERISA, (vii) all contributions or other amounts payable by
Ravenna, its Subsidiary or any ERISA Affiliates as of the Effective Time with
respect to each Plan in respect of current or prior plan years have been paid or
accrued in accordance with generally accepted accounting practices and Section
412 of the Code (except the employer matching contributions under the Ravenna
Savings Bank 401(k) Plan for the current year), (viii) neither Ravenna, its
Subsidiary nor any ERISA Affiliate has engaged in a transaction in connection
with which Ravenna, its Subsidiary or any ERISA Affiliate could be subject to
either a civil penalty assessed pursuant to Section 409 or 502(i) of ERISA or a
tax imposed pursuant to Section 4975 or 4976 of the Code, (ix) there are no
pending, or, to the best knowledge of Ravenna, threatened or reasonably
anticipated claims (other than routine claims for benefits) by, on behalf of or
against any of the Plans or any trusts related thereto and (x) except as
disclosed under Section 3.29 of this Agreement, the consummation of the
transactions contemplated by this Agreement will not (y) entitle any current or
former employee or officer of Ravenna or any ERISA Affiliate to severance pay,
termination pay or any other payment, except as expressly provided in this
Agreement or (z) accelerate the time of payment or vesting or increase the
amount of compensation due any such employee or officer.
3.12 Ravenna Information. The information relating to Ravenna and its
-------------------
Subsidiary to be contained in the Registration Statement on Form S-4 (the "S-
4"), or in any other document filed with any other regulatory agency in
connection herewith, will not contain any untrue statement of a material fact or
omit to state a material fact necessary to make the statements therein, in light
of the circumstances in which they are made, not misleading. The sections of the
Form S-4 relating to Ravenna will comply in all material respects with the
provisions of the Securities Act of 1933, as amended (the "Securities Act") and
the rules and regulations thereunder.
3.13 Ownership of Buyer Common Stock: Affiliates and Associates. Neither
-------------------------------- -------------------------
Ravenna nor its Subsidiary, (i) beneficially own, directly or indirectly, or
(ii) is a party to any agreement, arrangement or understanding for the purpose
of acquiring, holding, voting or disposing of, in each case, any shares of
capital stock of the Buyer (other than Trust Account Shares and DPC Shares).
3.14 Compliance with Applicable Law. Ravenna and its Subsidiary hold, and
------------------------------
have at all times held, all material licenses, franchises, permits and
authorizations necessary for the lawful conduct of their respective businesses
under and pursuant to all, and have complied with and are not, to Ravenna's
knowledge, in default in any respect under any applicable law, statute, order,
rule, regulation, policy and/or guideline of any Governmental Entity relating to
Ravenna or its Subsidiary, including, without limitation, the Truth in Lending
Act and Regulation Z promulgated thereunder, the Equal Credit Opportunity Act of
1974, as amended, and the regulations promulgated thereunder, the Real Estate
Settlement Procedures Act, the Fair Debt Collection Practices Act and all other
applicable fair lending laws and other laws related to discriminatory business
practices, except where the failure to hold such license, franchise, permit or
authorization or such noncompliance or default would not, individually or in the
aggregate, have or be reasonably likely to have a Material Adverse Effect on
Ravenna, and neither Ravenna nor its Subsidiary knows of, or has received notice
of, any material violations of any of the above.
3.15 Certain Contracts.
-----------------
(a) Except as set forth in Section 3.15(a) of the Ravenna Disclosure
Schedule, neither Ravenna nor its Subsidiary is a party to or bound by any
contract, arrangement, commitment or understanding (whether written or oral) (i)
with respect to the employment of any directors, officers, employees or
consultants, (ii) which, upon the consummation of the transactions contemplated
by this Agreement will (either alone or upon the occurrence of any additional
acts or events) result in any payment (whether of severance pay or otherwise)
becoming due from Buyer, Ravenna, the Surviving Entity or any of their
respective Subsidiaries to any officer or employee thereof, (iii) which is a
material contract (as defined in Item 601(b)(10) of Regulation S-K of the SEC)
to be performed after the date of this Agreement, (iv) which is a consulting
agreement (including data processing, software programming and licensing
contracts) not terminable on 60 days or less notice involving the payment of
more than $50,000 per annum, in the case of any such agreement with an
individual, or $100,000 per annum, in the case of any other such agreement, (v)
which materially restricts the conduct of any line of business by Ravenna or its
Subsidiary, (vi) with or to a labor union or guild (including any collective
bargaining agreement) or (vii) (including any stock option plan, stock
appreciation rights plan, restricted stock plan or stock purchase plan) any of
the benefits of which will be increased, or the vesting of the benefits of which
will be accelerated, by
the occurrence of any of the transactions contemplated by this Agreement, or the
value of any of the benefits of which will be calculated on the basis of any of
the transactions contemplated by this Agreement. Each contract, arrangement,
commitment or understanding of the type described in this Section 3.15(a),
whether or not set forth in Section 3.15(a) of Ravenna Disclosure Schedule, is
referred to herein as a "Ravenna Contract". Ravenna has previously delivered to
Buyer true and correct copies of each Ravenna Contract.
(b) Except as set forth in Section 3.15(b) of the Ravenna Disclosure
Schedule, (i) each Ravenna Contract is valid and binding and in full force and
effect, (ii) Ravenna and its Subsidiary have in all material respects performed
all obligations required to be performed by it to date under each Ravenna
Contract, except where such noncompliance, individually or in the aggregate,
would not have or be reasonably likely to have a Material Adverse Effect on
Ravenna, (iii) no event or condition exists which constitutes or, after notice
or lapse of time or both, would constitute, a material default on the part of
Ravenna or its Subsidiary under any such Ravenna Contract, except where such
default, individually or in the aggregate, would not have or be reasonably
likely to have a Material Adverse Effect on Ravenna and (iv) no other party to
such Ravenna Contract is, to the best knowledge of Ravenna, in default in any
respect thereunder.
3.16 Agreements with Regulatory Agencies. Except as set forth in Section
-----------------------------------
3.16 of the Ravenna Disclosure Schedule, neither Ravenna nor its Subsidiary is
subject to any cease-and-desist or other order issued by, or is a party to any
written agreement, consent agreement or memorandum of understanding with, or is
a party to any commitment letter or similar undertaking to, or is subject to any
order or directive by, or is a recipient of any extraordinary supervisory letter
from, or has adopted any board resolutions at the request of (each, whether or
not set forth on Section 3.16 of the Ravenna Disclosure Schedule, a "Regulatory
Agreement"), any Regulatory Agency or other Governmental Entity that restricts
the conduct of its business or that in any manner relates to its capital
adequacy, its credit policies, its management or its business, nor has Ravenna
or its Subsidiary been advised by any Regulatory Agency or other Governmental
Entity that it is considering issuing or requesting any Regulatory Agreement.
3.17 Investment Securities. Section 3.17 of the Ravenna Disclosure
---------------------
Schedule sets forth an investment securities (such term shall include mortgage
backed securities and securities held for sale by Ravenna and its Subsidiary)
report which includes security descriptions, CUSIP numbers, pool face values,
book values, coupon rates and market values, as of October 31, 1999.
3.18 Intellectual Property. Except where there would be no Material
---------------------
Adverse Effect on Ravenna, Ravenna and its Subsidiary owns or possesses valid
and binding licenses and other rights to use without payment all material
patents, copyrights, trade secrets, trade names, servicemarks, trademarks and
computer software used in its businesses; and neither Ravenna nor its Subsidiary
has received any notice of conflict with respect thereto that asserts the right
of others. Ravenna and its Subsidiary have in all material respects performed
all the obligations required to be performed by them and are not in default in
any material respect under any contract, agreement, arrangement or commitment
relating to any of the foregoing, except where such non-performance or default
would not, individually or in the aggregate, have or be reasonably likely to
have a Material Adverse Effect on Ravenna.
3.19 Undisclosed Liabilities. Except (a) as set forth in Section 3.19 of
-----------------------
the Ravenna Disclosure Schedule, (b) for those liabilities that are fully
reflected or reserved against on the consolidated balance sheet of Ravenna as of
June 30, 1999 and (c) for liabilities incurred in the ordinary course of
business consistent with past practice since June 30, 1999 that, either alone or
when combined with all similar liabilities, have not had, and could not
reasonably be expected to have, a Material Adverse Effect on Ravenna, neither
Ravenna nor its Subsidiary has incurred any liability of any nature whatsoever
(whether absolute, accrued, contingent or otherwise and whether due or to become
due).
3.20 Administration of Fiduciary Accounts. Ravenna and its Subsidiary has
------------------------------------
properly administered in all material respects all accounts for which it acts as
a fiduciary, including but not limited to accounts for which it serves as a
trustee, agent, custodian, personal representative, guardian, conservator or
investment advisor, in accordance with the terms of the governing documents and
applicable state and federal law and regulation and common law. Neither Ravenna
nor its Subsidiary nor any of their respective directors, officers or employees
has committed any breach of trust with respect to any such fiduciary account
which has had or could reasonably be expected to have a Material Adverse Effect
on Ravenna, and the accountings for each such fiduciary account are true and
correct in all material respects and accurately reflect the assets of such
fiduciary account.
3.21 Environmental Matters. Except as set forth in Section 3.21 of
---------------------
Ravenna Disclosure Schedule:
(a) Each of Ravenna, its Subsidiary, the Participation Facilities and the
Loan Properties (each as hereinafter defined) are, and have been, in compliance
with all applicable federal, state and local laws including common law,
regulations and ordinances and with all applicable decrees, orders and
contractual obligations relating to pollution, the discharge of, or exposure to
materials in the environment or workplace ("Environmental Laws"), except for
violations which, either individually or in the aggregate, have not had and
cannot reasonably be expected to have a Material Adverse Effect on Ravenna;
(b) There is no suit, claim, action or proceeding, pending or, to Ravenna's
knowledge, threatened, before any Governmental Entity or other forum in which
Ravenna, its Subsidiary, any Participation Facility or any Loan Property, has
been or, with respect to threatened proceedings, may be, named as a defendant
(x) for alleged noncompliance (including by any predecessor), with any
Environmental Laws, or (y) relating to the release, threatened release or
exposure to any material whether or not occurring at or on a site owned, leased
or operated by Ravenna or its Subsidiary, any Participation Facility or any Loan
Property, except where such noncompliance or release has not resulted, and
cannot be reasonably expected to result, either individually or in the
aggregate, a Material Adverse Effect on Ravenna;
(c) During the period of (x) Ravenna's or its Subsidiary's ownership or
operation of any of their respective current properties or (y) Ravenna's or its
Subsidiary's participation in the management of any Participation Facility,
there has been no release of materials in, on, under or affecting any such
property, except where such release has not had and cannot reasonably be
expected to result in, either individually or in the aggregate, a Material
Adverse Effect on Ravenna. During the period of Ravenna's or its
Subsidiary's holding of a security interest in a Loan Property, to Ravenna's
knowledge there has been no release of materials in, on, under or affecting, any
such property, except when such release has not had and cannot reasonably be
expected to result in, either individually or in the aggregate, a Material
Adverse Effect on Ravenna. Prior to the period of (x) Ravenna's or its
Subsidiary's ownership or operation of any of their respective current
properties, (y) Ravenna's or its Subsidiary's participation in the management of
any Participation Facility, or (z) Ravenna's or its Subsidiary's holding of a
security interest in a Loan Property, to Ravenna's knowledge there was no
release or threatened release of materials in, on, under or affecting any such
property, Participation Facility or Loan Property, except where such release has
not had and cannot be reasonably expected to have, either individually or in the
aggregate, a Material Adverse Effect on Ravenna;
(d) To Ravenna's knowledge, there are no underground storage tanks on, in
or under any properties currently or formerly owned or operated by Ravenna or
its Subsidiary, any Participation Facility or any Loan Property and no
underground storage tanks have been closed or removed from any properties
currently or formerly owned or operated by Ravenna or its Subsidiary, any
Participation Facility or any Loan Property which are or have been in the
ownership of Ravenna or its Subsidiary; and
(e) The following definitions apply for purposes of this Section 3.21: (x)
"Loan Property" means any property in which Ravenna or its Subsidiary holds a
security interest, and, where required by the context, said term means the owner
or operator of such property; and (y) "Participation Facility" means any
facility in which Ravenna or its Subsidiary participates in the management and,
where required by the context, said term means the owner or operator of such
property.
3.22 Derivative Transactions. Except for forward loan sale commitments
-----------------------
transacted in the ordinary course of business or as set forth in Section 3.22 of
the Ravenna Disclosure Schedule, since June 30, 1999, neither Ravenna nor its
Subsidiary has engaged in transactions in or involving forwards, futures,
options on futures, swaps or other derivative instruments except (i) as agent on
the order and for the account of others, or (ii) as principal for purposes of
hedging interest rate risk on U.S. dollar denominated securities and other
financial instruments. None of the counterparties to any contract or agreement
with respect to any such instrument is in default with respect to such contract
or agreement and no such contract or agreement, were it to be a Loan (as defined
below) held by Ravenna or its Subsidiary, would be classified as "Other Loans
Specially Mentioned", "Special Mention", "Substandard", "Doubtful", "Loss",
"Classified", "Criticized", "Credit Risk Assets", "Concerned Loans" or words of
similar import.
3.23 Opinion. Ravenna has received a written opinion, dated the date
-------
hereof, from McDonald to the effect that, subject to the terms, conditions and
qualifications set forth therein, as of the date thereof the Exchange Ratio is
fair to the Ravenna stockholders from a financial point of view. Such opinion
has not been amended or rescinded as of the date of this Agreement, and will be
updated at the time the proxy statement is mailed to stockholders of Ravenna.
3.24 Approvals. As of the date of this Agreement, Ravenna knows of no
---------
reason why all regulatory approvals required for the consummation of the
transactions contemplated hereby should not be obtained without the imposition
of a Burdensome Condition (as defined below).
3.25 Loan Portfolio.
--------------
(a) No Regulatory Agencies have required or requested Ravenna to increase
the allowance for loan losses as reflected in Ravenna's audited statement of
condition at June 30, 1999 or as shown on the balance sheets in its reports
filed with Regulatory Agencies for periods ending after June 30, 1999.
(b) Except as set forth in Section 3.25 of the Ravenna Disclosure Schedule,
neither Ravenna nor its Subsidiary is a party to any written or oral (i) loan
agreement, note or borrowing arrangement (including, without limitation, leases,
credit enhancements, commitments, guarantees and interest-bearing assets)
(collectively, "Loans"), other than Loans the unpaid principal balance of which
does not exceed $50,000, under the terms of which the obligor is, as of the date
of this Agreement, over 90 days delinquent in payment of principal or interest
or in default of any other provision, or (ii) Loan with any director, executive
officer or ten percent stockholder of Ravenna or its Subsidiary, or to the best
knowledge of Ravenna, any person, corporation or enterprise controlling,
controlled by or under common control with any of the foregoing. Section 3.25 of
Ravenna Disclosure Schedule sets forth (i) all of the Loans in original
principal amount in excess of $50,000 of Ravenna or its Subsidiary that as of
the date of this Agreement are classified by any bank examiner (whether
regulatory or internal) as "Other Loans Specially Mentioned," "Special Mention,"
"Substandard," "Doubtful," "Loss," "Classified," "Criticized," "Credit Risk
Assets," "Concerned Loans," "Watch List" or words of similar import, together
with the principal amount of and accrued and unpaid interest on each such Loan
and the identity of the borrower thereunder, and (ii) by category of Loan (i.e.,
commercial, consumer, etc.), all of the other Loans of Ravenna and its
Subsidiary that as of the date of this Agreement are classified as such,
together with the aggregate principal amount of and accrued and unpaid interest
on such Loans by category. Ravenna shall promptly inform Buyer in writing of any
Loan that becomes classified in the manner described in the previous sentence,
or any Loan the classification of which is changed, at any time after the date
of this Agreement.
(c) To the best of Ravenna's knowledge, each loan reflected as an asset in
Schedule 3.25 of the Ravenna Disclosure Schedule (i) is evidenced by notes,
agreements or other evidences of indebtedness which are true, genuine and
correct in all material respects, (ii) to the extent secured, has been secured
by valid liens and security interests which have been perfected, and (iii) is
the legal, valid and binding obligation of the obligor named therein,
enforceable in accordance with its terms, subject to bankruptcy, insolvency,
fraudulent conveyance and other laws of general applicability relating to or
affecting creditors' rights and to general equity principles, in each case other
than loans as to which the failure to satisfy the foregoing standards would not
have a Material Adverse Effect on Ravenna.
3.26 Mortgage Banking Business.
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(a) Licenses and Qualifications. Ravenna (i) is an approved (A) United
---------------------------
States Department of Housing and Urban Development ("HUD") mortgagee and
servicer for Federal Housing Administration ("FHA") -insured loans, (B) lender
and servicer for Veterans Administration ("VA") -insured loans and (C)
seller/servicer of one-to-four-family first mortgages for FannieMae ("FNMA") and
FreddieMac ("FHLMC"), (ii) has all other certifications, authorizations,
licenses, permits and other approvals necessary to conduct its current business
and (iii) is in good standing under all applicable federal, state
and local laws and regulations thereunder as a lender and servicer. As of the
date hereof, there is no pending or, to Ravenna's knowledge, threatened
cancellation or reduction of any loan purchase commitment or other loan sale
contract to which Ravenna is a party and which would have a Material Adverse
Effect on Ravenna or its Subsidiary, and the obligations of Ravenna under each
such contract are being performed by Ravenna substantially in accordance with
its terms. Ravenna has no reason to believe that it will suffer a forced
reduction of the master commitment amount relating to FNMA or FHLMC purchases or
swaps of loans, nor has any such restriction, rescission, increase or reduction
occurred at any time since June 30, 1999. Ravenna's Subsidiary is not required,
by virtue of its business activities, to be an approved (A) HUD mortgagee and
servicer for FHA-insured loans, (B) lender and servicer for VA-insured loans or
(c) seller/servicer of one-to-four family first mortgages for FNMA and FHLMC.
(b) Warehouse Lines of Credit. Ravenna does not maintain any warehouse
-------------------------
lines of credit.
(c) Compliance. Each loan which is being serviced by Ravenna for the
----------
account of others (the "Loans") was underwritten, and the loan documents and
loan files maintained by Ravenna with respect thereto are being maintained by
Ravenna in compliance with all applicable laws and regulations and, if
applicable, the requirements of the "Investor" (which term means (x) FHLMC,
FNMA, or any other person, as the case may be, that owns any of the Loans or any
portion of a Pool of loans or holds beneficial title to the Loans or any portion
of a Pool of loans, but shall not mean the holder of mortgage-backed securities
or mortgage pass-through securities except to the extent that the consent of
such holder may be required in order for Ravenna to continue to have servicing
rights with respect to the Loans related thereto and (y) any person who owns
servicing rights for loans serviced or master serviced by Ravenna pursuant to a
Loan Servicing Agreement) acquiring such Loan (or, if there is no such Investor,
in accordance with Ravenna's underwriting standards then in effect) and the
requirements of each person who insures or guarantees all or any portion of the
risk of loss upon borrower default on any of the Loans, including, without
limitation, the FHA, the VA and any private mortgage insurer, and providers of
life, hazard, flood, disability, title or other insurance with respect to any of
the Loans or the collateral therefor (each, an "Insurer"), if any, in effect and
applicable at the time such insurance was obtained. Ravenna has not done or
failed to do, or caused to be done or omitted to be done, any act, the effect of
which would operate to invalidate or materially impair (a) any approvals of any
Regulatory Agency or the FHA to insure, (b) any VA guarantee or commitment of
the VA to guarantee, (c) any private mortgage insurance or commitment of any
private mortgage insurer to insure, (d) any title insurance policy, (e) any
hazard insurance policy, (f) any flood insurance policy, (g) any fidelity bond,
direct surety bond, errors and omissions or other insurance policy required by
any Regulatory Agency, Investor or Insurer, (h) any surety or guaranty agreement
or (i) the rights of Ravenna under any Loan Servicing Agreement or loan purchase
commitment. No Regulatory Agency, Investor or Insurer has (i) notified Ravenna,
or to the knowledge of Ravenna claimed, that Ravenna has violated or has not
complied on a recurring basis with the applicable underwriting standards with
respect to Loans sold by Ravenna to an Investor or (ii) imposed restrictions on
the activities (including commitment authority) of Ravenna.
(d) Loan Files. The loan documents relating to a Loan maintained in the
----------
loan files of Ravenna were in compliance with all applicable laws and
regulations at the time
of the origination, assumption or modification of such Loan, as the case may be,
except where the failure to so comply, either individually or in the aggregate,
would not have a Material Adverse Effect on Ravenna or its Subsidiary. The loan
files maintained by Ravenna contain originals (or, where necessitated by the
terms of the applicable mortgage servicing agreements, contain true, correct and
complete copies) of the documents relating to each Loan and the information
contained in such loan files with respect to each such Loan is true, complete
and accurate and in compliance with all applicable laws and regulations, except
where the failure to so comply, either individually or in the aggregate, would
not have a Material Adverse Effect on Ravenna or its Subsidiary. Except as set
forth in the loan documents relating to a Loan maintained in the loan files of
Ravenna, the terms of the note, bond, deed of trust and mortgage for each such
Loan have not been impaired, waived, altered or modified in any respect from the
date of their origination except by a written instrument which written
instrument has been recorded, or submitted for recordation in due course, if
recordation is necessary to protect the interests of the owner thereof, except
where the failure to do any of the foregoing, either individually or in the
aggregate, would not have a Material Adverse Effect on Ravenna or its
Subsidiary. The substance of any such waiver, alteration or modification has
been communicated to and approved by (A) the relevant Investor and Insurer (if
any), to the extent required by the relevant Investor and Insurer requirements,
and (B) the title Insurer, to the extent required by the relevant policies, and
the terms of any such waiver, alteration or modification are reflected in the
loan documents, except where the failure to do any of the foregoing, either
individually or in the aggregate, would not have a Material Adverse Effect on
Ravenna or its Subsidiary. Except as set forth in the loan documents maintained
in the loan files by Ravenna, to Ravenna's knowledge no mortgagor has been
released from such mortgagor's obligations with respect to the applicable Loan.
(e) Loan Servicing Agreements. All of the contracts pursuant to which
-------------------------
Ravenna has the right and/or obligation to service loans (each, a "Loan
Servicing Agreement") are (i) valid and binding obligations of Ravenna, and to
the knowledge of Ravenna, of all the other parties thereto, (ii) in full force
and effect, (iii) enforceable in accordance with their terms (except where
enforcement thereof may be limited by bankruptcy, insolvency or other similar
laws affecting the enforcement of creditors' rights generally and by general
equity principles) and (iv) to Ravenna's knowledge, owned by Ravenna free and
clear of any Lien, except pursuant to the loan and security agreements disclosed
in Section 3.26(e) of the Ravenna Disclosure Schedule. There is no default by
Ravenna or claim of default pending or, to Ravenna's knowledge, threatened
against Ravenna by any party under any such Loan Servicing Agreement, and no
event has occurred which with the passage of time or the giving of notice or
both would constitute a default by any party under any such Loan Servicing
Agreement or would result in any such mortgage servicing agreement being
terminable by any party thereto. There is no pending or, to the knowledge of
Ravenna, threatened cancellation of any Loan Servicing Agreement and the
obligations of Ravenna under each Loan Servicing Agreement are being performed
by Ravenna in accordance with the terms of such Agreement and applicable rules
or regulations. Ravenna is not a subservicer with respect to any of the Serviced
Loans.
(f) No Recourse. Except as set forth in Section 3.26(f) of the Ravenna
-----------
Disclosure Schedule, none of Ravenna's servicing rights is subject to recourse
against the servicer, and Ravenna is not subject to recourse in connection with
any Loans sold by it, in each case for losses on liquidation of a loan, borrower
defaults or repurchase obligations upon the occurrence of non-payment or other
events, other than events entitling Investors to
request a repurchase of a loan because of alleged breaches of customary
representations and warranties relating to the origination or servicing thereof.
(g) Escrow Account. Unless otherwise prohibited by law or an executed
--------------
escrow waiver, Ravenna collects all escrows related to the Loans, and all escrow
accounts have been maintained by Ravenna and, to Ravenna's knowledge, all prior
servicers in accordance with the related loan documents, all applicable laws,
rules, regulations, and requirements of Investors, Insurers and governmental
authorities, and in accordance with the applicable Loan Servicing Agreements.
Ravenna has credited to the account of borrowers all interest required to be
paid on any escrow account in accordance with applicable law and the terms of
such agreements and loan documents. All escrow, custodial, and suspense accounts
related to the Loans are held in Ravenna's name or the investor's name by
Ravenna.
(h) Advances. There are no servicing or other contracts to which Ravenna
--------
is a party which obligates it to make servicing advances for principal and
interest payments with respect to defaulted or delinquent Loans other than in a
manner as provided in standard and customary agreements with FNMA or FHLMC. To
the extent made, any such advances are valid and subsisting amounts owing to
Ravenna, subject to the terms of the applicable Loan Servicing Agreement.
(i) ARM Adjustments. With respect to each Loan for which the interest
---------------
rate is not fixed for the entire term of the Loan, Ravenna has, since the date
it commenced servicing such Loan and, to Ravenna's knowledge, all prior
servicers have (i) properly and accurately entered into its system all data
required to service the loan in accordance with the related loan documents and
all regulations, (ii) properly and accurately adjusted the monthly payment on
each payment adjustment date, (iii) properly and accurately calculated the
amortization of principal and interest on each payment adjustment date, in each
case in compliance with all applicable laws, rules and regulations and the
related loan documents, and (iv) executed and delivered any and all necessary
notices required under, and in a form that complies with, all applicable laws,
rules and regulations and the terms of the related loan documents regarding the
interest rate and payment adjustments, except where the failure to do any of the
foregoing, either individually or in the aggregate, would not have a Material
Adverse Effect on Ravenna or its Subsidiary.
(j) Pools. Each Loan included in a pool of Loans originated, acquired or
-----
serviced by Ravenna (a "Pool") meets all eligibility requirements (including,
without limitation, all applicable requirements for obtaining mortgage insurance
certificates and loan guaranty certificates) for inclusion in such Pool. All of
such Pools have been finally certified or, if required, recertified in
accordance with all applicable laws, rules and regulations, except where the
time for certification or recertification has not expired. To the knowledge of
Ravenna, no Pools have been improperly certified. The loan file for each Loan
included in a certified Pool contains all documents and instruments necessary
for the final certification or recertification of such Pool. No Loan has been
bought out of a Pool without all required prior written approvals of the
applicable Investors. Neither the execution, delivery or performance of this
Agreement by Ravenna nor the consummation by Ravenna of the transactions
contemplated hereby will require any Pool to be recertified. The aggregate
unpaid principal balance outstanding of the Loans in each Pool equals or exceeds
the amount owing to the applicable Investors.
(k) Mortgage Insurance. Each Loan which is indicated in the related loan
------------------
documents to have FHA insurance is insured under the National Housing Act or
qualifies for such insurance. Each Loan which is indicated in the related loan
documents to be guaranteed by the VA is guaranteed under the provisions of
Chapter 37 of Title 38 of the United States Code to the extent required by the
applicable Investor or qualifies for such guarantee. As to each FHA insurance
certificate, each VA guarantee certificate, and each Loan which is indicated in
the related loan file to be insured by private mortgage insurance, Ravenna has
complied with or been granted waivers from applicable provisions of the
insurance or guarantee contract and applicable laws and regulations, except
where such failure to comply or to receive waivers, either individually or in
the aggregate, would not have a Material Adverse Effect on Ravenna or its
Subsidiary, the insurance or guarantee is in full force and effect with respect
to each such Loan, and to the knowledge of Ravenna, there does not exist any
event or condition which, but for the passage of time or the giving of notice or
both, can result in a revocation of any such insurance or guarantee or
constitute adequate grounds for the applicable Insurer to refuse to provide
insurance or guarantee payments thereunder.
3.27 Year 2000 Compliance. Ravenna and its Subsidiary have taken all
--------------------
reasonable steps necessary to address the software, accounting and record
keeping issues raised in order for the data processing systems used in the
business conducted by Ravenna and its Subsidiary to be substantially Year 2000
compliant on or before the end of 1999 and Ravenna expects the future cost of
addressing such issues to be $35,000. Except for the "Needs Improvement" rating
received from the FDIC and the Division on August 3, 1998, which rating was
subsequently revised to "Satisfactory" on July 26, 1999, neither Ravenna nor any
of its Subsidiary has received a rating of less than satisfactory from any bank
regulatory agency with respect to Year 2000 compliance.
3.28 Labor Matters. Except as set forth in Section 3.28 of the Ravenna
-------------
Disclosure Schedule, neither Ravenna nor its Subsidiary is or has ever been a
party to, or is or has ever been bound by, any collective bargaining agreement,
contract, or other agreement or understanding with a labor union or labor
organization with respect to its employees, nor is Ravenna or its Subsidiary the
subject of any proceeding asserting that it has committed an unfair labor
practice or seeking to compel it or any such Subsidiary to bargain with any
labor organization as to wages and conditions of employment, nor is the
management of Ravenna aware of any strike, other labor dispute, organizational
effort or other activity taken with a view toward unionization involving Ravenna
or its Subsidiary pending or threatened. To Ravenna's knowledge, Ravenna and its
Subsidiary are in compliance with applicable laws regarding employment or
employees and retention of independent contractors and are in material
compliance with all applicable employment tax laws.
3.29 Termination Benefits. Section 3.29 of the Ravenna Disclosure
--------------------
Schedule contains a complete and accurate schedule showing as of the date of
this Agreement the monetary amounts payable, subject to a determination of the
Market Value, and identifying the in-kind benefits due under the Specified
Compensation and Benefit Programs (as defined herein) for each Named Individual
(as defined herein) individually. For purposes hereof, "Specified Compensation
and Benefit Programs" shall include all employment agreements, change in control
agreements, severance or special termination agreements, severance plans,
pension, retirement or deferred compensation plans for non-employee directors,
supplemental executive retirement programs, tax indemnification agreements,
outplacement programs, cash bonus programs, stock appreciation right,
phantom stock or stock unit plan, and health, life, disability and other
insurance or welfare plans, but shall not include any tax-qualified pension,
profit-sharing or employee stock ownership plan. For purposes hereof, "Named
Individual" shall include each non-employee director of Ravenna or its
Subsidiary and each executive officer of Ravenna.
3.30 Deposits. None of the deposits of Ravenna or its Subsidiary is a
--------
"brokered" deposit.
3.31 Antitakeover Provisions Inapplicable. Ravenna and its Subsidiary have
------------------------------------
taken all actions required to exempt Ravenna and the Agreement from any
provisions of an antitakeover nature in their Articles of Incorporation,
Constitution and Bylaws and the provisions of any federal or state
"antitakeover," "fair price," "moratorium," "control share acquisition" or
similar laws or regulations.
3.32 Insurance. Ravenna and its Subsidiary are presently insured, and
---------
since December 31, 1996, have been insured, for reasonable amounts with
financially sound and reputable insurance companies, against such risks as
companies engaged in a similar business would, in accordance with good business
practice, customarily be insured. All of the insurance policies and bonds
maintained by Ravenna and its Subsidiary are in full force and effect, Ravenna
and its Subsidiary are not in default thereunder and all material claims
thereunder have been filed in due and timely fashion.
3.33 Indemnification. Except as provided in Ravenna's employment
---------------
agreements, its indemnification agreement with McDonald, or the Articles of
Incorporation, Constitution or Bylaws of Ravenna, neither Ravenna nor its
Subsidiary is a party to any indemnification agreement with any of its present
or future directors, officers, employees, agents or other persons who serve or
served in any other capacity with any other enterprise at the request of Ravenna
(a "Covered Person"), and, except as set forth in Section 3.33 of the Ravenna
Disclosure Schedule, to the best knowledge of Ravenna, there are no claims for
which any Covered Person would be entitled to indemnification under the Articles
of Incorporation, Constitution or Bylaws of Ravenna or any Subsidiary of
Ravenna, applicable law, regulation or any indemnification agreement.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer hereby represents and warrants to Ravenna as follows:
4.1 Corporate Organization.
----------------------
(a) Buyer is a corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware. Buyer has the corporate power
and authority to own or lease all of its properties and assets and to carry on
its business as it is now being conducted, and is duly licensed or qualified to
do business in each jurisdiction in which the nature of the business conducted
by it or the character or location of the properties and assets owned or leased
by it makes such licensing or qualification necessary, except where the failure
to be so licensed or qualified would not have a Material Adverse Effect on
Buyer. Buyer is duly registered as a savings and loan holding company under the
Home Owners' Loan Act of 1933, as amended (the "HOLA"). The Certificate of
Incorporation and By-laws of Buyer, copies of which have previously been made
available to Ravenna, are true, complete and correct copies of such documents as
in effect as of the date of this Agreement.
(b) The Association is a savings and loan association duly organized,
validly existing and in good standing under the laws of the United States of
America and the OTS Regulations. The deposit accounts of the Association are
insured by the FDIC through the SAIF to the fullest extent permitted by law, and
all premiums and assessments required in connection therewith have been paid by
the Association. The Buyer does not have any other Subsidiaries. The Association
has the corporate power and authority to own or lease all of its properties and
assets and to carry on its business as it is now being conducted. The Charter
and Bylaws of the Association, copies of which have previously been made
available to Ravenna, are true, complete and correct copies of such documents as
in effect as of the date of this Agreement.
(c) The minute books of Buyer and the Association contain true, complete
and accurate records in all material respects of all meetings and other
corporate actions held or taken since December 31, 1994 of their respective
stockholders and Boards of Directors (including committees of their respective
Boards of Directors).
4.2 Capitalization.
--------------
(a) As of the date of this Agreement, the authorized capital stock of Buyer
consists of 33,000,000 shares of Buyer Common Stock and 3,000,000 shares of
preferred stock, par value $.01 per share ("Buyer Preferred Stock"). As of
September 30, 1999, there were 11,241,250 shares of Buyer Common Stock and no
shares of Buyer Preferred Stock issued and outstanding, and no shares of Buyer
Common Stock held in Buyer's treasury. As of the date of this Agreement, no
shares of Buyer Common Stock or Buyer Preferred Stock were reserved for
issuance, except that 1,124,125 shares of Buyer Common Stock were reserved for
issuance upon the exercise of stock options pursuant to the First Place
Financial Corp. 1999 Incentive Plan (the "Buyer Stock Plan"). All of the issued
and outstanding shares of Buyer Common Stock and Buyer Preferred Stock have been
duly authorized and validly issued and are fully paid, nonassessable and free of
preemptive rights, with no personal liability attaching to the ownership
thereof. As of the date of this Agreement, except as referred to above or
reflected in Section 4.2(a) of the Buyer Disclosure Schedule, Buyer does not
have and is not bound by any outstanding subscriptions, options, warrants,
calls, commitments or agreements of any character calling for the purchase or
issuance of any shares of Buyer Common Stock or Buyer Preferred Stock or any
other equity securities of Buyer or any securities representing the right to
purchase or otherwise receive any shares of Buyer Common Stock or Buyer
Preferred Stock. The shares of Buyer Common Stock to be issued pursuant to the
Merger will be duly authorized and validly issued and, at the Effective Time,
all such shares will be fully paid, nonassessable and free of preemptive rights.
(b) Section 4.2(b) of the Buyer Disclosure Schedule sets forth a true and
correct list of all of the Buyer Subsidiaries as of the date of this Agreement.
Except as set forth in Section 4.2(b) of the Buyer Disclosure Schedule, Buyer
owns, directly or indirectly, all of the issued and outstanding shares of
capital stock of the Subsidiary of the Buyer, free and clear of all liens,
charges, encumbrances and security interests whatsoever, and all of such shares
are duly authorized and validly issued and are fully paid, nonassessable and
free of preemptive rights. No Subsidiary of the Buyer has or is bound by any
outstanding subscriptions, options, warrants, calls, commitments or agreements
of any character with
any party that is not a direct or indirect Subsidiary of Buyer calling for the
purchase or issuance of any shares of capital stock or any other equity security
of such Subsidiary or any securities representing the right to purchase or
otherwise receive any shares of capital stock or any other equity security of
such Subsidiary.
4.3 Authority. No Violation.
------------------------
(a) Buyer has full corporate power and authority to execute and deliver
this Agreement and to consummate the transactions contemplated hereby. The
execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby have been duly and validly approved by the
Board of Directors of Buyer. Except for the adoption of this Agreement by the
requisite vote of Buyer's stockholders, if required, no other corporate
proceedings on the part of Buyer are necessary to consummate the transactions
contemplated hereby. This Agreement has been duly and validly executed and
delivered by Buyer and (assuming due authorization, execution and delivery by
Ravenna) constitutes a valid and binding obligation of Buyer, enforceable
against Buyer in accordance with its terms, except as enforcement may be limited
by general principles of equity whether applied in a court of law or a court of
equity and by bankruptcy, insolvency and similar laws affecting creditors'
rights and remedies generally.
(b) The Association has full corporate power and authority to execute and
deliver this Agreement and to consummate the transactions contemplated hereby.
The execution and delivery of the Agreement and the consummation of the
transactions contemplated hereby has been duly and validly approved by the Board
of Directors of the Association. Upon the due and valid approval of this
Agreement by Buyer as the sole stockholder of the Association, no other
corporate proceedings on the part of the Association will be necessary to
consummate the transactions contemplated hereby. This Agreement has been duly
and validly executed and delivered by the Association and (assuming due
authorization, execution and delivery by the Buyer and Ravenna) constitutes a
valid and binding obligation of the Association, enforceable against the
Association in accordance with its terms, except as enforcement may be limited
by general principles of equity whether applied in a court of law or a court of
equity and by bankruptcy, insolvency and similar laws affecting creditors'
rights and remedies generally.
(c) Except as set forth in Section 4.3(c) of the Buyer Disclosure Schedule,
neither the execution and delivery of this Agreement by Buyer and the
Association, nor the consummation by Buyer or the Association, as the case may
be, of the transactions contemplated hereby, nor compliance by Buyer or the
Association, as the case may be, with any of the terms or provisions hereof,
will (i) violate any provision of the Certificate of Incorporation or By-Laws of
Buyer, or the charter or by-laws or similar governing documents of its
Subsidiary or (ii) assuming that the consents and approvals referred to in
Section 4.4 are duly obtained, (x) violate any statute, code, ordinance, rule,
regulation, judgment, order, writ, decree or injunction applicable to Buyer or
its Subsidiary or any of their respective properties or assets, or (y) violate,
conflict with, result in a breach of any provision of or the loss of any benefit
under, constitute a default (or an event which, with notice or lapse of time, or
both, would constitute a default) under, result in the termination of or a right
of termination or cancellation under, accelerate the performance required by, or
result in the creation of any lien, pledge, security interest, charge or other
encumbrance upon any of the respective properties or assets of Buyer or its
Subsidiary under, any of the terms, conditions or provisions of any note, bond,
mortgage, indenture,
deed of trust, license, lease, agreement or other instrument or obligation to
which Buyer or its Subsidiary is a party, or by which they or any of their
respective properties or assets may be bound or affected, except (in the case of
clause (y) above) for such violations, conflicts, breaches or defaults which
either individually or in the aggregate will not have or be reasonably likely to
have a Material Adverse Effect on Buyer.
4.4 Consents and Approvals. Except for (a) the filing of applications
----------------------
with the OTS and the FDIC, if necessary, and approval of such applications, (b)
the state banking approvals, (c) the filing with the SEC of the S-4, (d) the
filing of the Articles of Combination with the OTS, (e) such filings and
approvals as are required to be made or obtained under the securities or "Blue
Sky" laws of various states in connection with the issuance of the shares of
Buyer Common Stock pursuant to this Agreement, (f) the approval of the Agreement
by the stockholder of the Association, (g) the approval by the Nasdaq National
Market of the listing of the additional shares of Buyer Common Stock to be
issued pursuant to Section II hereof, and (h) such filings, authorizations or
approvals as may be set forth in Section 4.4 of the Buyer Disclosure Schedule,
no consents or approvals of or filings or registrations with any Governmental
Entity or with any third party are necessary in connection with (1) the
execution and delivery by Buyer and the Association of this Agreement, (2) the
consummation by Buyer and the Association of the Merger and the other
transactions contemplated hereby and (3) the consummation by the Association of
the transactions contemplated by the Agreement.
4.5 Financial Statements. Buyer has previously delivered to Ravenna
--------------------
copies of (a) the consolidated balance sheets of Buyer as of June 30, 1999 and
of the Association as of June 30 for the years 1997 and 1998 and the related
consolidated statements of income, changes in shareholders' equity and cash
flows for Buyer for the fiscal year ended June 30, 1999 and for the Association
for the fiscal years 1996 through 1998, inclusive, in each case accompanied by
the audit report of Xxxxx, Xxxxxx and Company LLP and Xxxxxx, Xxxxxx & Co.,
independent public accountants with respect to Buyer and the Association, and
(b) the unaudited consolidated balance sheet of Buyer and the Association as of
September 30, 1999 and September 30, 1998 and the related unaudited consolidated
statements of income, changes in shareholders' equity and cash flows for the
three month periods then ended as reported in Buyer's Quarterly Report on Form
10-Q for the period ended September 30, 1999 filed with the SEC under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"). The June 30,
1999 consolidated balance sheet of Buyer (including the related notes, where
applicable) fairly presents the consolidated financial position of Buyer as of
the date thereof, and the other financial statements referred to in this Section
4.5 (including the related notes, where applicable) fairly present and the
financial statements referred to in Section 6.9 hereof will fairly present
(subject, in the case of the unaudited statements, to recurring audit
adjustments normal in nature and amount), the results of the consolidated
operations and changes in shareholders' equity and consolidated financial
position of Buyer and the Association for the respective fiscal periods or as of
the respective dates therein set forth; each of such statements (including the
related notes, where applicable) comply, and the financial statements referred
to in Section 6.9 hereof will comply, in all material respects with applicable
accounting requirements and with the published rules and regulations of the SEC
with respect thereto; and each of such statements (including the related notes,
where applicable) has been, and the financial statements referred to in Section
6.9 hereof will be, prepared in accordance with GAAP consistently applied during
the periods involved, except as indicated in the notes thereto or, in the case
of unaudited statements, as permitted by Form 10-Q. The financial books and
records of Buyer and the
Association have been, and are being, maintained in all material respects in
accordance with GAAP.
4.6 Broker's Fees. Neither Buyer nor any Subsidiary of Buyer, nor any of
-------------
their respective officers or directors, has employed any broker or finder or
incurred any liability for any broker's fees, commissions or finder's fees in
connection with any of the transactions contemplated by this Agreement, except
that Buyer has engaged, and will pay a fee or commission to, Xxxxxxx Xxxx &
Company, a Division of Xxxxx, Xxxxxxxx and Xxxxx, Inc. ("Xxxx").
4.7 Absence of Certain Changes or Events.
------------------------------------
(a) Except as may be set forth in Section 4.7 of the Buyer Disclosure
Schedule, or as disclosed in Buyer's Quarterly Report on Form 10-Q for the
quarter ended September 30, 1999 (a true, complete and correct copy of which has
previously been delivered to Ravenna), since June 30, 1999, (i) neither Buyer
nor its Subsidiary has incurred any material liability, except in the ordinary
course of their business consistent with their past practices, and (ii) to
Buyer's knowledge, no event has occurred which has caused, or is reasonably
likely to cause, individually or in the aggregate, a Material Adverse Effect on
Buyer.
(b) Except as set forth in Section 4.7(b) of the Buyer Disclosure Schedule,
since September 30, 1999, the Buyer and its Subsidiary have carried on their
respective businesses in the ordinary course consistent with their past
practices.
4.8 Legal Proceedings.
-----------------
(a) Except as set forth in Section 4.8 of the Buyer Disclosure Schedule or
in Buyer's Quarterly Report on Form 10-Q for the quarter ended September 30,
1999, neither Buyer nor its Subsidiary is a party to any and there are no
pending or to the best of Buyer's knowledge, threatened, material legal,
administrative, arbitral or other proceedings, claims, actions or governmental
or regulatory investigations of any nature against Buyer or its Subsidiary or
challenging the validity or propriety of the transactions contemplated by this
Agreement as to which there is a reasonable probability of an adverse
determination and which, if adversely determined, would have or be reasonably
likely to have a Material Adverse Effect on Buyer.
(b) There is no injunction, order, judgment, decree, or regulatory
restriction imposed upon Buyer, its Subsidiary or the assets of Buyer or its
Subsidiary which has had, or could reasonably be expected to have, a Material
Adverse Effect on Buyer.
4.9 Compliance with Applicable Law. Buyer and its Subsidiary holds, and
------------------------------
has at all times held, all material licenses, franchises, permits and
authorizations necessary for the lawful conduct of their respective businesses
under and pursuant to all, and have complied with and are not in default in any
respect under any, applicable law, statute, order, rule, regulation, policy
and/or guideline of any Governmental Entity relating to Buyer or its Subsidiary,
except where the failure to hold such license, franchise, permit or
authorization or such non-compliance or default would not, individually or in
the aggregate, have, or be reasonably likely to have, a Material Adverse Effect
on Buyer, and neither Buyer nor its Subsidiary knows of, or has received notice
of violation of, any material violations of any of the above.
4.10 SEC Reports. Buyer has previously made available to Ravenna an
-----------
accurate and complete copy of each (a) final registration statement, prospectus,
report, schedule and definitive proxy statement filed since September 1, 1998 by
Buyer with the SEC pursuant to the Securities Act or the Exchange Act (the
"Buyer Reports") and (b) communication mailed by Buyer to its shareholders since
September 1, 1998, and no such registration statement, prospectus, report,
schedule, proxy statement or communication contained any untrue statement of a
material fact or omitted to state any material fact required to be stated
therein or necessary in order to make the statements therein, in light of the
circumstances in which they were made, not misleading, except that information
as of a later date shall be deemed to modify information as of an earlier date.
Buyer has timely filed all Buyer Reports and other documents required to be
filed by it under the Securities Act and the Exchange Act, and, as of their
respective dates, all Buyer Reports complied in all material respects with the
published rules and regulations of the SEC with respect thereto.
4.11 Buyer Information. The information relating to Buyer and its
-----------------
Subsidiary to be contained in the S-4, or in any other document filed with any
other regulatory agency in connection herewith, will not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements therein, in light of the circumstances in which they are made,
not misleading. The S-4 (except for such portions that relate only to Ravenna or
its Subsidiary, as to which the Buyer makes no representation) will comply in
all material respects with the provisions of the Securities Act of 1933 and the
rules and regulations thereunder and the Exchange Act and the rules and
regulations thereunder, if applicable.
4.12 Ownership of Ravenna Common Stock. Neither Buyer nor any of its
---------------------------------
affiliates or associates (as such terms are defined under the Exchange Act) (i)
beneficially own, directly or indirectly, or (ii) is a party to any agreement,
arrangement or understanding for the purpose of acquiring, holding, voting or
disposing of, in each case, any shares of capital stock of Ravenna (other than
Trust Account Shares and DPC Shares); and
4.13 Taxes. Except as set forth in Section 4.13 of the Buyer Disclosure
-----
Schedule, each of Buyer and its Subsidiary has (i) duly and timely filed or will
duly and timely file (including applicable extensions granted without penalty)
all Tax Returns required to be filed at or prior to the Effective Time, and such
Tax Returns which have heretofore been filed are, and those to be hereinafter
filed will be, true, correct and complete, and (ii) paid in full or have made
adequate provision for on the financial statements of Buyer (in accordance with
GAAP) all Taxes and will pay in full or make adequate provision for all Taxes,
except where the failure to do any of the foregoing would not have a Material
Adverse Effect on Buyer and its Subsidiary, taken as a whole. There are no
material liens for Taxes upon the assets of either Buyer or its Subsidiary
except for statutory liens for current Taxes not yet due. Except as set forth in
Section 4.13 of the Buyer Disclosure Schedule, neither Buyer nor its Subsidiary
has requested any extension of time within which to file any Tax Returns in
respect of any fiscal year which have not since been filed and no request for
waivers of the time to assess any Taxes are pending or outstanding. The federal
and state income Tax Returns of Buyer and its Subsidiary have been audited by
the Internal Revenue Service or appropriate state tax authorities with respect
to those periods and jurisdictions set forth on Section 4.13 of the Buyer
Disclosure Schedule. Except as set forth in Section 4.13 of the Buyer Disclosure
Schedule, neither Buyer nor its Subsidiary (i) is a party to any agreement
providing for the allocation or sharing of Taxes (other than the allocation of
federal income taxes as provided by Regulation 1.1552 l(a)(1) under the Code);
(ii) is required to include in income any adjustment pursuant to Section 481(a)
of the Code, by reason of the voluntary change in accounting method (nor has any
taxing authority proposed in writing any such adjustment or change of accounting
method); or (iii) has filed a consent pursuant to Section 341(f) of the Code.
4.14 Employees.
---------
(a) Section 4.14(a) of the Buyer Disclosure Schedule sets forth a true and
complete list of each employee benefit plan, arrangement or agreement that is
maintained or contributed to or required to be contributed to as of the date of
this Agreement (the "Buyer Plans") by Buyer, its Subsidiary or by any trade or
business, whether or not incorporated (a "Buyer ERISA Affiliate"), all of which
together with Buyer would be deemed a "single employer" within the meaning of
Section 4001 of ERISA, for the benefit of any employee or former employee of
Buyer, any Subsidiary or any ERISA Affiliate.
(b) Except as set forth in Section 4.14(b) of the Buyer Disclosure
Schedule, (i) each of the Buyer Plans has been operated and administered in all
material respects in accordance with its terms and applicable law, including but
not limited to ERISA and the Code, (ii) each of the Buyer Plans intended to be
"qualified" within the meaning of Section 401(a) of the Code has either (1)
received a favorable determination letter from the IRS, or (2) is or will be the
subject of an application for a favorable determination letter, and Buyer is not
aware of any circumstances likely to result in the revocation or denial of any
such favorable determination letter, (iii) with respect to each Buyer Plan which
is subject to Title IV of ERISA, the present value of accrued benefits under
such Buyer Plan, based upon the actuarial assumptions used for funding purposes
in the most recent actuarial report prepared by such Buyer Plan's actuary with
respect to such Buyer Plan, did not, as of its latest valuation date, exceed the
then current value of the assets of such Buyer Plan allocable to such accrued
benefits, (iv) no Plan provides benefits, including without limitation death or
medical benefits (whether or not insured), with respect to current or former
employees of Buyer, its Subsidiary or any ERISA Affiliate beyond their
retirement or other termination of service, other than (w) coverage mandated by
applicable law, (x) death benefits or retirement benefits under any "employee
pension plan," as that term is defined in Section 3(2) of ERISA, (y) deferred
compensation benefits accrued as liabilities on the books of Buyer, its
Subsidiary or the ERISA Affiliates or (z) benefits the full cost of which is
borne by the current or former employee (or his beneficiary), (v) no liability
under Title IV of ERISA has been incurred by Buyer, its Subsidiary or any Buyer
ERISA Affiliate that has not been satisfied in full, (vi) no Buyer Plan is a
"multiemployer pension plan," as such term is defined in Section 3(37) of ERISA,
(vii) all contributions or other amounts payable by Buyer, its Subsidiary or any
ERISA Affiliate as of the Effective Time with respect to each Plan in respect of
current or prior plan years have been paid or accrued in accordance with
generally accepted accounting practices and Section 412 of the Code, (viii)
neither Buyer, its Subsidiary nor any ERISA Affiliate has engaged in a
transaction in connection with which Buyer, its Subsidiary or any ERISA
Affiliate could be subject to either a civil penalty assessed pursuant to
Section 409 or 502(i) of ERISA or a tax imposed pursuant to Section 4975 or 4976
of the Code, (ix) there are no pending, or, to the best knowledge of Buyer,
threatened or anticipated claims (other than routine claims for benefits) by, on
behalf of or against any of the Buyer Plans or any trusts related thereto and
(x) the consummation
of the transactions contemplated by this Agreement will not (y) entitle any
current or former employee or officer of Buyer or any ERISA Affiliate to
severance pay, termination pay or any other payment, except as expressly
provided in this Agreement or (z) accelerate the time of payment or vesting or
increase in the amount of compensation due any such employee or officer.
4.15 Agreements with Regulatory Agencies. Except as set forth in Section
-----------------------------------
4.15 of the Buyer Disclosure Schedule, neither Buyer nor its Subsidiary is
subject to any cease-and-desist or other order issued by, or is a party to any
written agreement, consent agreement or memorandum of understanding with, or is
a party to any commitment letter or similar undertaking to, or is subject to any
order or directive by, or is a recipient of any extraordinary supervisory letter
from, or has adopted any board resolutions at the request of (each, whether or
not set forth in Section 4.15 of the Buyer Disclosure Schedule, a "Buyer
Regulatory Agreement"), any Regulatory Agency or other Governmental Entity that
restricts the conduct of its business or that in any manner relates to its
capital adequacy, its credit policies, its management or its business, nor has
Buyer or its Subsidiary been advised by any Regulatory Agency or other
Governmental Entity that it is considering issuing or requesting any Regulatory
Agreement.
4.16 Investment Securities. Section 4.16 of the Buyer Disclosure Schedule
---------------------
sets forth an investment securities (such term shall include mortgage backed
securities and securities held for sale of the Buyer and its Subsidiary) report
which includes security descriptions, CUSIP numbers, pool face values, book
values, coupon rates and market values, as of October 31, 1999.
4.17 Undisclosed Liabilities. Except (a) as set forth in Section 4.17 of
-----------------------
the Buyer Disclosure Schedule, (b) for those liabilities that are fully
reflected or reserved against on the consolidated balance sheet of Buyer
included in its Form 10-Q for the period ended September 30, 1999 and (c) for
liabilities incurred in the ordinary course of business consistent with past
practice since September 30, 1999 that, either alone or when combined with all
similar liabilities, have not had, and could not reasonably be expected to have,
a Material Adverse Effect on Buyer, neither Buyer nor its Subsidiary has
incurred any liability of any nature whatsoever (whether absolute, accrued,
contingent or otherwise and whether due or to become due).
4.18 Administration of Fiduciary Accounts. Buyer and its Subsidiary has
------------------------------------
properly administered in all material respects all accounts for which it acts as
a fiduciary, including but not limited to accounts for which it serves as a
trustee, agent, custodian, personal representative, guardian, conservator or
investment advisor, in accordance with the terms of the governing documents and
applicable state and federal law and regulation and common law. Neither Buyer
nor its Subsidiary nor any of their respective directors, officers or employees
has committed any breach of trust with respect to any such fiduciary account
which has or could reasonably be expected to have a Material Adverse Effect on
Buyer, and the accountings for each such fiduciary account are true and correct
in all material respects and accurately reflect the assets of such fiduciary
account.
4.19 Approvals. As of the date of this Agreement, Buyer knows of no
---------
reason why all regulatory approvals required for the consummation of the
transactions contemplated hereby should not be obtained without the imposition
of a Burdensome Condition.
4.20 Reports. Buyer and its Subsidiary have timely filed all material
-------
reports, registrations and statements, together with any amendments required to
be made with respect thereto, that they were required to file since June 30,
1995 with any Regulatory Agency, and all other material reports and statements
required to be filed by them since June 30, 1995, including, without limitation,
any report or statement required to be filed pursuant to the laws, rules or
regulations of the United States, the OTS, the FDIC, any State Regulator or any
SRO, and have paid all fees and assessments due and payable in connection
therewith. Except for normal examinations conducted by a Regulatory Agency in
the regular course of the business of Buyer and its Subsidiary and, except as
set forth in Section 4.20 of Buyer Disclosure Schedule, no Regulatory Agency has
initiated any proceeding or, to the best knowledge of Buyer, investigation into
the business or operations of Buyer or its Subsidiary since June 30, 1995. There
is no unresolved material violation, criticism, or exception by any Regulatory
Agency with respect to any report or statement relating to any examinations of
Buyer or its Subsidiary.
4.21 State Takeover Laws. The provisions of Article VIII of Buyer's
-------------------
Certificate of Incorporation will not, assuming the accuracy of the
representations contained in Section 3.13 hereof, apply to the Agreement or any
of the transactions contemplated hereby.
4.22 Environmental Matters. Except as set forth in Section 4.22 of the
---------------------
Buyer Disclosure Schedule:
(a) Each of Buyer, its Subsidiary, the Participation Facilities and the
Loan Properties (each as hereinafter defined) are, and have been, in compliance
with Environmental Laws, except for violations which, either individually or in
the aggregate, have not had and cannot reasonably be expected to have a Material
Adverse Effect on Buyer;
(b) There is no suit, claim, action or proceeding, pending or, to Buyer's
knowledge, threatened, before any Governmental Entity or other forum in which
Buyer, any of its Subsidiary, any Participation Facility or any Loan Property,
has been or, with respect to threatened proceedings, may be, named as a
defendant (x) for alleged noncompliance (including by any predecessor), with any
Environmental Laws, or (y) relating to the release, threatened release or
exposure to any material whether or not occurring at or on a site owned, leased
or operated by Buyer or any of its Subsidiary, any Participation Facility or any
Loan Property, except where such noncompliance or release has not resulted, and
cannot be reasonably expected to result, either individually or in the
aggregate, a Material Adverse Effect on Buyer;
(c) During the period of (x) Buyer's or any of its Subsidiary's ownership
or operation of any of their respective current properties or (y) Buyer's or any
of its Subsidiary's participation in the management of any Participation
Facility, there has been no release of materials in, on, under or affecting any
such property, except where such release has not had and cannot reasonably be
expected to result in, either individually or in the aggregate, a Material
Adverse Effect on Buyer. During the period of Buyer's or its Subsidiary's
holding of a security interest in a Loan Property, to the Buyer's knowledge
there has been no release of materials in, on, under or affecting any such
property, except where such release has not had and cannot reasonably be
expected to result in, either individually or in the aggregate, a Material
Adverse Effect on Buyer or its Subsidiary, taken as a whole. Prior to the period
of (x) Buyer's or any of its Subsidiary's ownership
or operation of any of their respective current properties, (y) Buyer's or any
of its Subsidiary's participation in the management of any Participation
Facility, or (z) Buyer's or any of its Subsidiary's holding of a security
interest in a Loan Property, to Buyer's knowledge there was no release or
threatened release of materials in, on, under or affecting any such property,
Participation Facility or Loan Property, except where such release has not had
and cannot be reasonably expected to have, either individually or in the
aggregate, a Material Adverse Effect on Buyer; and
(d) The following definitions apply for purposes of this Section 4.22: (x)
"Loan Property" means any property in which Buyer or its Subsidiary holds a
security interest, and, where required by the context, said term means the owner
or operator of such property; and (y) "Participation Facility" means any
facility in which Buyer or its Subsidiary participates in the management and,
where required by the context, said term means the owner or operator of such
property.
4.23 Derivative Transactions. Except as set forth in Section 4.23 of the
-----------------------
Buyer Disclosure Schedule, since June 30, 1999, neither Buyer nor its Subsidiary
has engaged in transactions which exceed $100,000 in or involving forwards,
futures, options on futures, swaps or other derivative instruments except (i) as
agent on the order and for the account of others, or (ii) as principal for
purposes of hedging interest rate risk on U.S. dollar denominated securities and
other financial instruments. None of the counterparties to any contract or
agreement with respect to any such instrument is in default with respect to such
contract or agreement and no such contract or agreement, were it to be a Loan
held by Buyer or its Subsidiary, would be classified as "Other Loans Specially
Mentioned," "Special Mention," "Substandard," "Doubtful," "Loss," "Classified,"
"Criticized," "Credit Risk Assets," "Concerned Loans" or words of similar
import. No open exposure of Buyer or its Subsidiary with respect to any such
instrument (or with respect to multiple instruments with respect to any single
counterparty) exceeds $500,000.
4.24 Loan Portfolio.
--------------
(a) Except as set forth in Section 4.24 of the Buyer Disclosure Schedule,
neither Buyer nor its Subsidiary is a party to any written or oral (i) Loan,
other than Loans the unpaid principal balance of which does not exceed $50,000,
under the terms of which the obligor is, as of the date of this Agreement, over
90 days delinquent in payment of principal or interest or in default of any
other provision, or (ii) Loan as of the date of this Agreement with any
director, executive officer or ten percent stockholder of Buyer or its
Subsidiary, or to the best knowledge of Buyer, any person, corporation or
enterprise controlling, controlled by or under common control with any of the
foregoing. Section 4.24 of the Buyer Disclosure Schedule sets forth (i) all of
the Loans in original principal amount in excess of $50,000 of Buyer or its
Subsidiary that as of the date of this Agreement are classified by any bank
examiner (whether regulatory or internal) as "Other Loans Specially Mentioned",
"Special Mention", "Substandard", "Doubtful", "Loss", "Classified",
"Criticized", "Credit Risk Assets", "Concerned Loans", "Watch List" or words of
similar import, together with the principal amount of and accrued and unpaid
interest on each such Loan and the identity of the borrower thereunder, and (ii)
by category of Loan (i.e., commercial, consumer, etc.), all of the other Loans
of Buyer and its Subsidiary that as of the date of this Agreement are classified
as such, together with the aggregate principal amount of and accrued and unpaid
interest on such Loans by category. Buyer shall promptly inform Ravenna in
writing of any loan that becomes
classified in the manner described in the previous sentence, or any Loan the
classification of which is changed, at any time after the date of this
Agreement.
(b) To the best of its knowledge, each loan reflected as an asset in the
Schedule 4.24 of Buyer Disclosure Schedule (i) is evidenced by notes, agreements
or other evidences of indebtedness which are true, genuine and correct in all
material respects, (ii) to the extent secured, has been secured by valid liens
and security interests which have been perfected, and (iii) is the legal, valid
and binding obligation of the obligor named therein, enforceable in accordance
with its terms, subject to bankruptcy, insolvency, fraudulent conveyance and
other laws of general applicability relating to or affecting creditors' rights
and to general equity principles, in each case other than loans as to which the
failure to satisfy the foregoing standards would not have a Material Adverse
Effect on the Buyer.
4.25 Intellectual Property. Except where there would be no Material
---------------------
Adverse Effect on Buyer, Buyer and its Subsidiary owns or possesses valid and
binding licenses and other rights to use without payment all material patents,
copyrights, trade secrets, trade names, service marks, trademarks and computer
software used in its businesses; and neither Buyer nor its Subsidiary has
received any notice of conflict with respect thereto that asserts the right of
others. Buyer and its Subsidiary have in all material respects performed all the
obligations required to be performed by them and are not in default in any
material respect under any contract, agreement, arrangement or commitment
relating to any of the foregoing, except where such non-performance or default
would not, individually or in the aggregate, have or be reasonably likely to
have a Material Adverse Effect on Buyer.
4.26 Year 2000 Compliance. Buyer and its Subsidiary have taken all
--------------------
reasonable steps necessary to address the software, accounting and record
keeping issues raised in order for the data processing systems used in the
business conducted by Buyer and its Subsidiary to be substantially Year 2000
compliant on or before the end of 1999 and Buyer expects the future cost of
addressing such issues to be $35,000. Neither Buyer nor any of its Subsidiary
has received a rating of less than satisfactory from any bank regulatory agency
with respect to Year 2000 compliance.
4.27 Labor Matters. Except as set forth in Section 4.27 of the Buyer
-------------
Disclosure Schedule, neither Buyer nor its Subsidiary is or has ever been a
party to, or is or has ever been bound by, any collective bargaining agreement,
contract, or other agreement or understanding with a labor union or labor
organization with respect to its employees, nor is Buyer or its Subsidiary the
subject of any proceeding asserting that it has committed an unfair labor
practice or seeking to compel it or any such Subsidiary to bargain with any
labor organization as to wages and conditions of employment, nor is the
management of Buyer aware of any strike, other labor dispute, organizational
effort or other activity taken with a view toward unionization involving Buyer
or its Subsidiary pending or threatened. To Buyer's knowledge, Buyer and its
Subsidiary are in compliance with applicable laws regarding employment or
employees and retention of independent contractors and are in material
compliance with all applicable employment tax laws.
4.28 Deposits. None of the deposits of the Association is a "brokered"
--------
deposit.
4.29 Insurance. Buyer and its Subsidiary are presently insured, and since
---------
December 31, 1996, have been insured, for reasonable amounts with financially
sound
and reputable insurance companies, against such risks as companies engaged in a
similar business would, in accordance with good business practice, customarily
be insured. All of the insurance policies and bonds maintained by Buyer and its
Subsidiary are in full force and effect, Buyer and its Subsidiary are not in
default thereunder and all material claims thereunder have been filed in due and
timely fashion.
ARTICLE V
COVENANTS RELATING TO CONDUCT OF BUSINESS
5.1 Covenants of Ravenna. During the period from the date of this
--------------------
Agreement and continuing until the Effective Time, except as expressly
contemplated or permitted by this Agreement or with the prior written consent of
Buyer, Ravenna and its Subsidiary shall carry on their respective businesses in
the ordinary course consistent with past practice and consistent with prudent
banking practice. Ravenna will use its best efforts to (x) preserve its business
organization and that of its Subsidiary intact, (y) keep available to itself and
Buyer the present services of the employees of Ravenna and its Subsidiary and
(z) preserve for itself and Buyer the goodwill of the customers of Ravenna and
its Subsidiary and others with whom business relationships exist. Without
limiting the generality of the foregoing, and except as set forth on Section 5.1
of the Ravenna Disclosure Schedule or as otherwise contemplated by this
Agreement or consented to in writing by Buyer (which consent shall not be
unreasonably withheld), Ravenna shall not, and shall not permit its Subsidiary
to:
(a) solely in the case of Ravenna, declare or pay dividends on, or make
other distributions in respect of, any of its capital stock, except that, if the
Effective Time has not occurred prior to January 7, 2000, Ravenna may pay its
regular semiannual dividend in January 2000, in an amount equal to no more than
$150 per share of Ravenna Common Stock, subject to Ravenna's normal procedures
on declaration and payment of dividends. If the Effective Time occurs after
April 7, 2000, and prior to July 7, 2000, Ravenna may pay to its shareholders a
quarterly dividend in an amount equal to one-half of its regular semiannual
dividend (in the amount of $75 per share) prior to the Closing, and if the
Effective Time occurs after July 7, 2000, Ravenna may pay to its shareholders an
additional quarterly dividend in an amount equal to one-half of its regular
semiannual dividend (in the amount of $75 per share) prior to the Closing;
(b) (i) split, combine or reclassify any shares of its capital stock or
issue or authorize or propose the issuance of any other securities in respect
of, in lieu of or in substitution for shares of its capital stock except upon
the exercise or fulfillment of rights or options issued or existing pursuant to
employee benefit plans, programs or arrangements, all to the extent outstanding
and in existence on the date of this Agreement and in accordance with their
present terms, or (ii) repurchase, redeem or otherwise acquire (except for the
acquisition of Trust Account Shares and DPC Shares, as such terms are defined in
Section 1.4(b) hereof) any shares of the capital stock of Ravenna or any
Subsidiary of Ravenna, or any securities convertible into or exercisable for any
shares of the capital stock of Ravenna or any Subsidiary of Ravenna;
(c) issue, deliver or sell, or authorize or propose the issuance, delivery
or sale of, any shares of its capital stock or any securities convertible into
or exercisable for, or any rights, warrants or options to acquire, any such
shares, or enter into any agreement with
respect to any of the foregoing, other than the issuance of Ravenna Common Stock
pursuant to stock options or similar rights to acquire Ravenna Common Stock
granted pursuant to the Ravenna Option Plan and outstanding prior to the date of
this Agreement, in each case in accordance with their present terms;
(d) amend its Articles of Incorporation, Constitution, By-laws or other
similar governing documents;
(e) authorize or permit any of its officers, directors, employees or
agents to directly or indirectly solicit, initiate or encourage any inquiries
relating to, or the making of any proposal which constitutes, a "takeover
proposal" (as defined below), or, except to the extent legally required for the
discharge of the fiduciary duties of the Board of Directors of Ravenna,
recommend or endorse any takeover proposal, or participate in any discussions or
negotiations, or provide third parties with any nonpublic information, relating
to any such inquiry or proposal or otherwise facilitate any effort or attempt to
make or implement a take over proposal; provided, however, that Ravenna may
-------- -------
communicate information about any such takeover proposal to its stockholders if,
in the judgment of Ravenna's Board of Directors, based upon the written opinion
of outside counsel, such communication is required under applicable law. Ravenna
will immediately cease and cause to be terminated any existing activities,
discussions or negotiations previously conducted with any parties other than
Buyer with respect to any of the foregoing. Ravenna will take all actions
necessary or advisable to inform the appropriate individuals or entities
referred to in the first sentence hereof of the obligations undertaken in this
Section 5.1(e). Ravenna will notify Buyer immediately if any such inquiries or
takeover proposals are received by, any such information is requested from, or
any such negotiations or discussions are sought to be initiated or continued
with, Ravenna, and Ravenna will promptly inform Buyer in writing of all of the
relevant details with respect to the foregoing. As used in this Agreement,
"takeover proposal" shall mean any tender or exchange offer, proposal for a
merger, consolidation or other business combination involving Ravenna or any
Subsidiary of Ravenna or any proposal or offer to acquire in any manner a
substantial equity interest in, or a substantial portion of the assets of
Ravenna or any Subsidiary of Ravenna other than the transactions contemplated or
permitted by this Agreement;
(f) make any capital expenditures other than the expenditures which are
set forth in Section 5.1(f) of the Ravenna Disclosure Schedule and expenditures
which (i) are made in the ordinary course of business or are necessary to
maintain existing assets in good repair, or (ii) in an amount of no more than
$20,000 individually and $50,000 in the aggregate;
(g) enter into any new line of business;
(h) (i) acquire or agree to acquire, by merging or consolidating with, or
by purchasing a substantial equity interest in or a substantial portion of the
assets of, or by any other manner, any business or any corporation, partnership,
association or other business organization or division thereof or otherwise
acquire any assets, which would be material, individually or in the aggregate,
to Ravenna, other than in connection with foreclosures, settlements in lieu of
foreclosure or troubled loan or debt restructurings in the ordinary course of
business consistent with prudent banking practices or (ii) acquire any servicing
right in a "bulk" transaction;
(i) take any action that is intended or may reasonably be expected to
result in any of its representations and warranties set forth in this Agreement
being or becoming untrue in any material respect, or in any of the conditions to
the Merger set forth in Article VII not being satisfied, or in a violation of
any provision of this Agreement, except, in every case, as may be required by
applicable law;
(j) change its methods of accounting in effect at June 30, 1999, except as
required by changes in GAAP as concurred to by Ravenna's independent auditors;
(k) (i) except as required by applicable law or to maintain qualification
pursuant to the Code, adopt, amend, renew or terminate any Plan or any
agreement, arrangement, plan or policy between Ravenna or any Subsidiary of
Ravenna and one or more of its current or former directors, officers or
employees or (ii) except for normal increases in the ordinary course of business
consistent with past practice, but limited in all events to no more than a 5%
increase, or except as required by applicable law, increase in any manner the
compensation or fringe benefits of any director, officer or employee or pay any
benefit not required by any plan or agreement as in effect as of the date hereof
(including, without limitation, the granting of stock options, stock
appreciation rights, restricted stock, restricted stock units or performance
units or shares);
(l) take or cause to be taken any action which would disqualify the Merger
as a tax free reorganization under Section 368 of the Code;
(m) except as set forth in Section 5.1(m) of the Ravenna Disclosure
Schedule, other than activities in the ordinary course of business consistent
with prior practice, (i) sell, lease, encumber, assign or otherwise dispose of,
or agree to sell, lease, encumber, assign or otherwise dispose of, any of its
material assets, properties or other rights or agreements, (ii) purchase, sell,
assign or otherwise transfer any right to service loans, or (iii) sell,
transfer, lease or encumber any loan;
(n) other than in the ordinary course of business consistent with past
practice, incur any indebtedness for borrowed money, assume, guarantee, endorse
or otherwise as an accommodation become responsible for the obligations of any
other individual, corporation or other entity;
(o) file any application to relocate or terminate the operations of any
banking office of it or its Subsidiary;
(p) commit any act or omission which constitutes a material breach or
default by Ravenna or its Subsidiary under any Regulatory Agreement or under any
material contract or material license to which Ravenna or its Subsidiary is a
party or by which any of them or their respective properties is bound;
(q) except as set forth in Disclosure Schedule 3.25, compromise, extend or
restructure any real estate loan, construction loan or commercial loan with an
unpaid principal balance except in the ordinary course of business consistent
with past practices;
(r) make, renegotiate, renew, increase, extend or purchase any (i) loans,
lease (credit equivalent), advance, credit enhancement or other extension of
credit, or make any commitment in respect of any of the foregoing, except (A) in
conformity with existing lending practices in amounts not to exceed the limits
approved by FNMA or FHLMC to
any individual borrower or (b) loans or advances as to which Ravenna has a
legally binding obligation to make such loan or advances as of the date hereof
and a description of which has been provided by Ravenna in Section 5.1(r) of the
Ravenna Disclosure Schedule; or (ii) loans, advances or commitments to
directors, officers or other affiliated parties of Ravenna or its Subsidiary
except for renewals of any such loans referred to in this clause (ii) or set
forth in Section 5.1(r) of the Ravenna Disclosure Schedule.
(s) purchase or commit to purchase any bulk loan portfolio;
(t) except for forward loan commitments transacted in the ordinary course
of business consistent with past practices (which shall be subject to review by
Buyer), engage in or enter into any structured transactions, derivative
securities, arbitrage or hedging activity;
(u) make any equity investment or commitment to make such an investment in
real estate or in any real estate development project, other than in connection
with foreclosures, settlements in lieu of foreclosure or troubled loan or debt
restructurings in the ordinary course of business consistent with prudent
banking practices, or for goods, services or other items necessary in the
ordinary course of business relating to foreclosures, settlements in lieu of
foreclosure or troubled loan or debt restructurings;
(v) except as set forth in Section 5.1(v) of the Ravenna Disclosure
Schedule, create, renew, amend or terminate or give notice of a proposed
renewal, amendment or termination of, any material contract, agreement or lease
for goods, services or office space to which Ravenna or its Subsidiary is a
party or by which Ravenna or its Subsidiary or their respective properties is
bound;
(w) take any action which would cause the termination or cancellation by
the FDIC of insurance in respect of Ravenna Bank's deposits; or
(x) except for short-term investments with stated maturities of less than
one year, make any investment in any investment security, including
mortgage-backed and mortgage related securities;
(y) settle any claim, action or proceeding involving any liability of
Ravenna or its Subsidiary for money damages in excess of $25,000 or material
restrictions upon the operations of Ravenna or its Subsidiary;
(z) elect to the Board of Directors of Ravenna or to any office any person
who is not a member of the Board of Directors of Ravenna or an officer of
Ravenna as of the date of this Agreement; or
(aa) agree to do any of the foregoing.
5.2 Covenants of Buyer. During the period from the date of this Agreement
------------------
and continuing until the Effective Time, except as expressly contemplated or
permitted by this Agreement or with the prior written consent of Ravenna, Buyer
and its Subsidiary shall carry on their respective businesses in the ordinary
course consistent with past practice and consistent with prudent banking
practice. Buyer will use its best efforts to (x) preserve its business
organization and that of its Subsidiary intact and (y) preserve for itself and
Ravenna the goodwill of the customers of Buyer and its Subsidiary and others
with whom business relationships exist. Without limiting the generality of the
foregoing and except as set forth on Section 5.2 of the Buyer Disclosure
Schedule or as otherwise contemplated by this Agreement or consented to in
writing by Ravenna, Buyer shall not, and shall not permit its Subsidiary to:
(a) declare or pay any extraordinary or special dividends on or make any
other extraordinary or special distributions in respect of any of its capital
stock; provided, however, that nothing contained herein shall prohibit Buyer
-------- -------
from increasing the quarterly cash dividend on the Buyer Common Stock;
(b) take any action that is intended or may reasonably be expected to
result in any of its representations and warranties set forth in this Agreement
being or becoming untrue in any material respect, or in any of the conditions to
the Merger set forth in Article VII not being satisfied or in a violation of any
provision of this Agreement except, in every case, as may be required by
applicable law;
(c) change its methods of accounting in effect at June 30, 1999, except in
accordance with changes in GAAP or regulatory accounting principles as concurred
to by Buyer's independent auditors;
(d) take or cause to be taken any action which would disqualify the Merger
as a tax free reorganization under Section 368 of the Code;
(e) take any action which would cause the termination or cancellation by
the FDIC of insurance in respect of the Association's deposits; or
(f) agree to do any of the foregoing.
ARTICLE VI
ADDITIONAL AGREEMENTS
6.1 Regulatory Matters.
------------------
(a) Buyer shall promptly prepare and file with the SEC the S-4. Buyer
shall use all reasonable efforts to have the S-4 declared effective under the
Securities Act as promptly as practicable after such filing, and Ravenna shall
thereafter mail the prospectus which is a part of the S-4, together with such
proxy disclosure as shall be deemed necessary by Ravenna, subject to review and
reasonable revision by Buyer, to each of its respective stockholders. Buyer
shall also use all reasonable efforts to obtain all necessary state securities
law or "Blue Sky" permits and approvals required to carry out the transactions
contemplated by this Agreement, and Ravenna shall furnish all information
concerning Ravenna and the holders of Ravenna Common Stock as may be reasonably
requested in connection with any such action.
(b) The parties hereto shall cooperate with each other and use their best
efforts to promptly prepare and file all necessary documentation, to effect all
applications, notices, petitions and filings, and to obtain as promptly as
practicable all permits, consents, approvals and authorizations of all third
parties and Governmental Entities which are necessary or advisable to consummate
the transactions contemplated by this Agreement
(it being understood that any amendments to the S-4 or a resolicitation of
proxies as consequence of a subsequent proposed merger, stock purchase or
similar acquisition by Buyer or its Subsidiary shall not violate this covenant).
Ravenna and Buyer shall have the right to review in advance, and to the extent
practicable each will consult the other on, in each case subject to applicable
laws relating to the exchange of information, all the information relating to
Ravenna or Buyer, as the case may be, and any of their respective Subsidiaries,
which appear in any filing made with, or written materials submitted to, any
third party or any Governmental Entity in connection with the transactions
contemplated by this Agreement. In exercising the foregoing right, each of the
parties hereto shall act reasonably and as promptly as practicable. The parties
hereto agree that they will consult with each other with respect to the
obtaining of all permits, consents, approvals and authorizations of all third
parties and Governmental Entities necessary or advisable to consummate the
transactions contemplated by this Agreement and each party will keep the other
apprised of the status of matters relating to completion of the transactions
contemplated herein.
(c) Buyer and Ravenna shall, upon request, furnish each other with all
information concerning themselves, their Subsidiaries, directors, officers and
stockholders and such other matters as may be reasonably necessary or advisable
in connection with the S-4 or any other statement, filing, notice or application
made by or on behalf of Buyer, Ravenna or any of their respective Subsidiaries
to any Governmental Entity in connection with the Merger and the other
transactions contemplated by this Agreement.
(d) Buyer and Ravenna shall promptly furnish each other with copies of
written communications received by Buyer or Ravenna, as the case may be, or any
of their respective Subsidiaries, Affiliates or Associates (as such terms are
defined in Rule 12b-2 under the Exchange Act as in effect on the date of this
Agreement) from, or delivered by any of the foregoing to, any Governmental
Entity in respect of the transactions contemplated hereby.
6.2 Access to Information.
---------------------
(a) Upon reasonable notice and subject to applicable laws relating to the
exchange of information, Ravenna shall, and shall cause its Subsidiary to,
afford to the officers, employees, accountants, counsel and other
representatives of Buyer, access, during normal business hours during the period
prior to the Effective Time, to all its properties, books, contracts,
commitments, records, officers, employees, accountants, counsel and other
representatives, including the ability to review and test Ravenna's systems that
may be impacted by the Year 2000 date change problem, and, during such period,
Ravenna shall, and shall cause its Subsidiary to, make available to Buyer (i) a
copy of each report, schedule and other document filed or received by it during
such period pursuant to the requirements of Federal or state banking laws (other
than reports or documents which Ravenna is not permitted to disclose under
applicable law) and (ii) all other information concerning its business,
properties and personnel as Buyer may reasonably request. Neither Ravenna nor
its Subsidiary shall be required to provide access to or to disclose information
where such access or disclosure would violate or prejudice the rights of
Ravenna's customers, jeopardize any attorney-client privilege or contravene any
law, rule, regulation, order, judgment, decree, fiduciary duty or binding
agreement entered into prior to the date of this Agreement. The parties hereto
will make
appropriate substitute disclosure arrangements under circumstances in which the
restrictions of the preceding sentence apply.
(b) Upon reasonable notice and subject to applicable laws relating to the
exchange of information, Buyer shall, and shall cause its Subsidiary to, afford
to the officers, employees, accountants, counsel and other representatives of
Ravenna, access, during normal business hours during the period prior to the
Effective Time, to such information regarding Buyer and its Subsidiary as shall
be reasonably necessary for Ravenna to fulfill its obligations pursuant to this
Agreement to prepare the proxy disclosure or which may be reasonably necessary
for Ravenna to confirm that the representations and warranties of Buyer
contained herein are true and correct and that the covenants of Buyer contained
herein have been performed in all material respects. Neither Buyer nor its
Subsidiary shall be required to provide access to or to disclose information
where such access or disclosure would violate or prejudice the rights of Buyer's
customers, jeopardize any attorney-client privilege or contravene any law, rule,
regulation, order, judgment, decree, fiduciary duty or binding agreement entered
into prior to the date of this Agreement. The parties hereto will make
appropriate substitute disclosure arrangements under circumstances in which the
restrictions of the preceding sentence apply.
(c) All information furnished by Buyer to Ravenna or its representatives
pursuant hereto shall be treated as the sole property of Buyer and, if the
Merger shall not occur, Ravenna and its representatives shall return to Buyer
all of such written information and all documents, notes, summaries or other
materials containing, reflecting or referring to, or derived from, such
information. Ravenna shall, and shall use its best efforts to cause its
representatives to, keep confidential all such information, and shall not
directly or indirectly use such information for any competitive or other
commercial purpose. The obligation to keep such information confidential shall
continue for two years from the date the proposed Merger is abandoned and shall
not apply to (i) any information which (x) was already in Ravenna's possession
prior to the disclosure thereof by Buyer; (y) was then generally known to the
public; or (z) was disclosed to Ravenna by a third party not bound by an
obligation of confidentiality or (ii) disclosures made as required by law. It is
further agreed that, if in the absence of a protective order or the receipt of a
waiver hereunder Ravenna is nonetheless, in the opinion of its counsel,
compelled to disclose information concerning Buyer to any tribunal or
governmental body or agency or else stand liable for contempt or suffer other
censure or penalty, Ravenna may disclose such information to such tribunal or
governmental body or agency without liability hereunder.
(d) All information furnished by Ravenna to the Buyer or its
representatives pursuant hereto shall be treated as the sole property of Ravenna
and, if the Merger shall not occur, the Buyer and its representatives shall
return to Ravenna all of such written information and all documents, notes,
summaries or other materials containing, reflecting or referring to, or derived
from, such information. The Buyer shall, and shall use its best efforts to cause
its representatives to, keep confidential all such information, and shall not
directly or indirectly use such information for any competitive or other
commercial purpose. The obligation to keep such information confidential shall
continue for two years from the date the proposed Merger is abandoned and shall
not apply to (i) any information which (x) was already in the Buyer's possession
prior to the disclosure thereof by Ravenna; (y) was then generally known to the
public; or (z) was disclosed to the Buyer by a third party not bound by an
obligation of confidentiality or (ii) disclosures made as required by law. It is
further agreed that, if in the absence of a protective order
or the receipt of a waiver hereunder the Buyer is nonetheless, in the opinion of
its counsel, compelled to disclose information concerning Ravenna to any
tribunal or governmental body or agency or else stand liable for contempt or
suffer other censure or penalty, the Buyer may disclose such information to such
tribunal or governmental body or agency without liability hereunder.
(e) No investigation by either of the parties or their respective
representatives shall affect the representations, warranties, covenants or
agreements of the other set forth herein.
(f) Ravenna shall give timely notice of and shall permit a representative
of Buyer to attend meetings of Ravenna's Board of Directors or the Executive
Committee thereof, except to the extent that such meeting, or portion thereof,
relates to the Merger.
6.3 (a) Stockholder Meetings. Ravenna and the Buyer, if required by law
--------------------
or regulation, shall take all steps necessary to duly call, give notice of,
convene and hold a special or annual meeting of its stockholders to be held as
soon as is reasonably practicable after the date on which the S-4 becomes
effective for the purpose of voting upon the approval of this Agreement and the
consummation of the transactions contemplated hereby. Ravenna and Buyer, if a
meeting is held, will, through its Board of Directors, except to the extent
legally required for the discharge of the fiduciary duties of such board,
recommend to its respective stockholders approval of this Agreement and the
transactions contemplated hereby and such other matters as may be submitted to
its stockholders in connection with this Agreement.
(b) Voting Agreements. Each of Ravenna's directors and certain officers,
-----------------
as set forth in Section 6.3(b) of the Ravenna Disclosure Schedule, will enter
into a Voting Agreement, a form of which is attached as Exhibit 6.3(b) hereto,
within two days after the date of this Agreement.
6.4 Legal Conditions to Merger. Each of Buyer and Ravenna shall, and
--------------------------
shall cause its Subsidiaries to, use their best efforts (a) to take, or cause to
be taken, all actions necessary, proper or advisable to comply promptly with all
legal requirements which may be imposed on such party or its Subsidiary with
respect to the Merger and, subject to the conditions set forth in Article VII
hereof, to consummate the transactions contemplated by this Agreement and (b) to
obtain (and to cooperate with the other party to obtain) any consent,
authorization, order or approval of, or any exemption by, any Governmental
Entity and any other third party which is required to be obtained by Ravenna or
Buyer or any of their respective Subsidiaries in connection with the Merger and
the other transactions contemplated by this Agreement, and to comply with the
terms and conditions of such consent, authorization, order or approval;
provided, however, that neither Buyer nor Ravenna shall be obligated to take any
-------- -------
action pursuant to the foregoing if the taking of such action or such compliance
or the obtaining of such consent, authorization, order or approval is likely, in
the good faith reasonable opinion of Buyer, to result in the imposition of a
Burdensome Condition.
6.5 Affiliates. Ravenna shall deliver to Buyer as soon as practicable
----------
after the date of this Agreement, and in any event prior to the earlier of the
date of the stockholders meeting called by Ravenna to approve this Agreement,
after consultation with legal counsel, a list of the names and addresses of
those persons it deems to be "affiliates" of Ravenna within the meaning of Rule
145 under the Securities Act and a written
agreement, in the form of Exhibit 6.5(a) hereto providing that such person will
not sell, pledge, transfer or otherwise dispose of any shares of Buyer Common
Stock to be received by such "affiliate" in the Merger, except in compliance
with the applicable provisions of the Securities Act and the rules and
regulations thereunder.
6.6 Stock Exchange Listing. Buyer shall cause the shares of Buyer Common
----------------------
Stock to be issued in the Merger to be approved for quotation on the Nasdaq
National Market, subject to official notice of issuance, as of the Effective
Time.
6.7 Employee Benefit Plans; Existing Agreements.
-------------------------------------------
(a) The employees of Ravenna (the "Ravenna Employees") shall be entitled
to participate in Buyer's employee benefit plans in which similarly situated
employees of Buyer participate, to the same extent as comparable employees of
Buyer, except as outlined below. As of the Effective Time, Buyer shall permit
Ravenna Employees to participate in Buyer's group health, life and disability
insurance plans on the same terms and conditions as applicable to comparable
employees of Buyer and its Subsidiary; provided, however, that all Ravenna
employees and dependents will be eligible to participate in health insurance
plans of the Association upon the merger without regard to any pre-existing
conditions or exclusions and with no uninsured waiting periods, and the carry
over of all current plan year deductibles and annual out-of-pocket contribution,
to the extent permitted by the Buyer's medical insurance plans. Buyer shall
continue the Ravenna Savings Bank 401(k) Profit Sharing Plan (the "Ravenna
401(k) Plan") for a period of up to two years for the benefit of the Ravenna
Employees. After such period, Buyer may elect to merge the Ravenna 401(k) Plan
into the Buyer's 401(k) savings plan. As of the next entry date beginning two
years after the Effective Time, Buyer shall permit Ravenna Employees to
participate in the Association's employee stock ownership plan ("ESOP") on the
same terms and conditions as employees of Buyer and its Subsidiary. Buyer shall
give effect to years of service with Ravenna and its Subsidiary as if such
service were with Buyer, for purposes of eligibility and vesting, but not for
benefit accrual purposes, provided, however, in no event shall said Ravenna
employees be credited with more than three (3) years of service with Ravenna and
its Subsidiary for vesting purposes under the ESOP as of the Effective Time.
Ravenna Employees shall retain their accrued short-term disability, unused sick
leave benefits and vacation pay determined as of the Effective Time, provided
such amounts have been fully accrued for by Ravenna as of the Effective Time;
and Ravenna Employees shall be entitled to payment of vacation pay as provided
in past practice by Ravenna. As of the Effective Time, all participants under
Ravenna's defined contribution plan shall become 100% vested in all participant
accounts. With respect to Buyer's welfare benefit plans, (including by example,
vacation, sick leave, severance), Ravenna employees shall have prior service
with Ravenna recognized for purposes of eligibility to participate, vesting and
benefits accrual purposes.
(b) Buyer shall honor and shall cause the Surviving Entity to honor in
accordance with their terms all employment, severance and other compensation
agreements and arrangements of Ravenna Employees, officers and directors. Such
agreements and arrangements shall include, but not be limited to (i) severance
benefit plans listed in Section 6.7(b)(1) of the Ravenna Disclosure Schedule,
existing prior to the execution of this Agreement and (ii) the agreements and
arrangement, as set forth in Section 6.7(b)(2) of the Ravenna Disclosure
Schedule, provided that they have previously been delivered
to Buyer. At Buyer's election, benefits to be paid from such agreements and
arrangements shall be paid by Ravenna prior to Closing.
(c) In the event that the employment of any Ravenna Employee who did not
have an employment agreement with Ravenna at the Effective Time is actually
terminated by Buyer within one hundred twenty (120) days following the Effective
Time for reasons due to the Merger, then Buyer shall provide to such terminated
Ravenna Employee a severance payment in an amount equal to such Ravenna
Employee's weekly salary as of the date of such termination multiplied by each
full year during which such Ravenna Employee has been employed by Ravenna or its
Subsidiary, up to ten years of employment; provided, however, that Buyer shall
retain the right to terminate any Ravenna Employee for justifiable cause,
without becoming obligated to pay such severance payment.
6.8 Indemnification.
---------------
(a) Following the Effective Date and for a period of six years thereafter,
Buyer shall indemnify, defend and hold harmless the present directors and
officers of Ravenna and its Subsidiary (each, an "Indemnified Party") against
all costs or expenses, including reasonable attorneys' fees), judgments, fines,
losses, claims, damages or liabilities incurred in connection with any claim,
action, suit, proceeding or investigation, whether civil, criminal,
administrative or investigative, arising out of actions or omissions occurring
at or prior to the Effective Time (including, without limitation, the
transactions contemplated by this Agreement) to the extent that Ravenna is or
would have been authorized to indemnify (and advance expenses to) its directors
and officers under the laws of the State of Ohio, Ravenna's Articles of
Incorporation and Constitution as in effect as of the date hereof, and in the
event of any such threatened or actual claim, action, suit, proceeding or
investigation (whether asserted or arising before or after the Effective Time),
the Indemnified Parties may retain counsel reasonably satisfactory to them after
consultation with Buyer; provided, however, that (1) Buyer shall have the right
-------- -------
to assume the defense thereof and upon such assumption Buyer shall not be liable
to any Indemnified Party for any legal expenses of other counsel or any other
expenses subsequently incurred by any Indemnified Party in connection with the
defense thereof, except that if Buyer elects not to assume such defense or
counsel for the Indemnified Parties reasonably advises that there are issues
which raise conflicts of interest between Buyer and the Indemnified Parties, the
Indemnified Parties may retain counsel reasonably satisfactory to them after
consultation with Buyer, and Buyer shall pay the reasonable fees and expenses of
such counsel for the Indemnified Parties, (2) Buyer shall in all cases be
obligated pursuant to this paragraph to pay for only one firm of counsel for all
Indemnified Parties, (3) Buyer shall not be liable for any settlement effected
without its prior written consent (which consent shall not be unreasonably
withheld) and (4) Buyer shall have no obligation hereunder to any Indemnified
Party when and if a court of competent jurisdiction shall ultimately determine,
and such determination shall have become final and nonappealable, that
indemnification of such Indemnified Party in the manner contemplated hereby is
prohibited by applicable law. Any Indemnified Party wishing to claim
Indemnification under this Section 6.8, upon learning of any such claim, action,
suit, proceeding or investigation, shall notify promptly Buyer thereof, provided
that the failure to so notify shall not affect the obligations of Buyer under
this Section 6.8 except to the extent such failure to notify prejudices Buyer.
(b) Buyer shall cause the persons serving as officers and directors of
Ravenna immediately prior to the Effective Time to be covered for a period of
six years from the Effective Time by the directors' and officers' liability
insurance policy maintained by Ravenna (provided that Buyer may substitute
therefor policies of at least the same coverage and amounts containing terms and
conditions which are not less advantageous than such policy) with respect to
acts or omissions occurring prior to the Effective Time which were committed by
such officers and directors in their capacity as such so long as the annual
premium therefore is not in excess of 125% of the aggregate premiums paid by
Ravenna in 1999 on an annualized basis for such purpose which aggregate premiums
on an annualized basis is disclosed in Section 6.8(b) of the Ravenna Disclosure
Schedule), but if the annual premiums therefor so exceeds such amount, the Buyer
will obtain as much directors' and officers' liability insurance as can be
obtained for the reminder of such period for a premium not in excess of 125% of
the aggregate premiums paid by Ravenna in 1999 on an annualized basis for such
purpose.
(c) In the event Buyer or the Surviving Corporation or any of its
successors or assigns (i) consolidates with or merges into any other person and
shall not be the continuing or surviving corporation or entity of such
consolidation or merger, or (ii) transfers or conveys all or substantially all
of its properties and assets to any person, then, and in each such case, to the
extent necessary, proper provision shall be made so that the successors and
assigns of Buyer or the Surviving Entity, as the case may be, assume the
obligations set forth in this section.
(d) The provisions of this Section 6.8 are intended to be for the benefit
of, and shall be enforceable by, each Indemnified Party and his or her heirs and
representatives; and the provisions of this Section 6.8 will survive the
Effective Time.
6.9 Subsequent Interim and Annual Financial Statements. As soon as
--------------------------------------- ----------
reasonably available, but in no event more than 45 days after the end of each
fiscal quarter ending after the date of this Agreement, Buyer will deliver to
Ravenna its Quarterly Report on Form 10-Q, as filed with the SEC under the
Exchange Act and Ravenna shall deliver to Buyer its unaudited financial
statements for the quarter then ended.
6.10 Additional Agreements. In case at any time after the Effective Time
---------------------
any further action is necessary or desirable to carry out the purposes of this
Agreement, or to vest the Surviving Entity with full title to all properties,
assets, rights, approvals, immunities and franchises of any of the parties to
the Merger, the proper officers and directors of each party to this Agreement
and their respective Subsidiaries shall take all such necessary action as may be
reasonably requested by Buyer.
6.11 Advice of Changes. Buyer and Ravenna shall promptly advise the other
-----------------
party of any change or event having a Material Adverse Effect on it or which it
believes would or would be reasonably likely to cause or constitute a material
breach of any of its representations, warranties or covenants contained herein.
From time to time prior to the Effective Time (and on the date prior to the
Closing Date), each party will promptly supplement or amend the Disclosure
Schedules delivered in connection with the execution of this Agreement to
reflect any matter which, if existing, occurring or known at the date of this
Agreement, would have been required to be set forth or described in such
Disclosure Schedules or which is necessary to correct any information in such
Disclosure Schedules which has been rendered inaccurate thereby. No supplement
or amendment to such Disclosure Schedules shall have any effect for the purpose
of
determining satisfaction of the conditions set forth in Sections 7.2(a) or
7.3(a) hereof, as the case may be, or the compliance by Ravenna or Buyer, as the
case may be, with the respective covenants and agreements of such parties
contained herein.
6.12 Current Information. During the period from the date of this
-------------------
Agreement to the Effective Time, Ravenna will cause one or more of its
designated representatives to notify on a regular and frequent basis (not less
than weekly) representatives of Buyer and to report (i) the general status of
the ongoing operations of Ravenna and its Subsidiary; (ii) the status of, and
the action proposed to be taken with respect to, those Loans held by Ravenna or
its Subsidiary which, individually or in combination with one or more other
Loans to the same borrower thereunder, have an original principal amount of
$50,000 or more and are non-performing assets; (iii) the origination of all
loans other than 1-4 family residential mortgage loans and consumer loans; and
(iv) any material changes in Ravenna's pricing of deposits. Ravenna will
promptly notify Buyer of any material change in the normal course of business or
in the operation of the properties of Ravenna or its Subsidiary and of any
governmental complaints, investigations or hearings (or communications
indicating that the same may be contemplated), or the institution or the threat
of significant litigation involving Ravenna or its Subsidiary, and will keep
Buyer fully informed of such events.
6.13 Directorships. Buyer and Surviving Entity shall cause its respective
-------------
Board of Directors to be expanded by one member and shall appoint one of the
current directors of Ravenna (such director to be mutually agreed upon by Buyer
and Ravenna) (the "Ravenna Director") to fill the vacancy on each Board of
Directors created by such increase as of the Effective Time. The initial term
for the Ravenna Director on the Buyer's Board and the Surviving Entity's Board
shall expire in 2001. Upon expiration of the initial terms, the Ravenna Director
will be considered by the respective Board Nominating Committee to stand for
Director for a new three-year term.
ARTICLES VII
CONDITIONS PRECEDENT
7.1 Conditions to Each Party's Obligation To Effect the Merger. The
----------------------------------------------------------
respective obligation of each party to effect the Merger shall be subject to the
satisfaction at or prior to the Effective Time of the following conditions:
(a) Stockholder Approval. This Agreement shall have been approved and
--------------------
adopted by the affirmative vote of a majority of the outstanding shares of
Ravenna Common Stock entitled to vote thereon and by the requisite vote of
Buyer's stockholders, if required by law or regulation.
(b) Nasdaq Stock Market Listing. The shares of Buyer Common Stock which
---------------------------
shall be issued to the stockholders of Ravenna upon consummation of the Merger
shall have been authorized for quotation on the Nasdaq National Market, subject
to official notice of issuance.
(c) Other Approvals. All regulatory approvals required to consummate the
---------------
transactions contemplated hereby shall have been obtained and shall remain in
full force
and effect and all statutory waiting periods in respect thereof shall
have expired (all such approvals and the expiration of all such waiting periods
being referred to herein as the "Requisite Regulatory Approvals").
(d) S-4. The S-4 shall have become effective under the Securities Act and
---
no stop order suspending the effectiveness of the S-4 shall have been issued and
no proceedings for that purpose shall have been initiated or threatened by the
SEC.
(e) No Injunctions or Restraints; Illegality. No order, injunction or
----------------------------------------
decree issued by any court or agency of competent jurisdiction or other legal
restraint or prohibition (an "Injunction") preventing the consummation of the
Merger, or any of the other transactions contemplated by this Agreement shall be
in effect. No statute, rule, regulation, order, injunction or decree shall have
been enacted, entered, promulgated or enforced by any Governmental Entity which
prohibits, restricts or makes illegal consummation of the Merger.
7.2 Conditions to Obligations of Buyer. The obligation of Buyer to effect
----------------------------------
the Merger is also subject to the satisfaction or waiver by Buyer at or prior to
the Effective Time of the following conditions:
(a) Representations and Warranties. The representations and warranties of
------------------------------
Ravenna set forth in this Agreement shall be true and correct in all material
respects as of the date of this Agreement and as of the Closing Date as though
made on and as of the Closing Date. Buyer shall have received a certificate
signed on behalf of Ravenna by the Chief Executive Officer and the Chief
Financial Officer of Ravenna to the foregoing effect.
(b) Performance of Obligations of Ravenna. Ravenna shall have performed
-------------------------------------
in all material respects all obligations required to be performed by it under
this Agreement at or prior to the Closing Date, and Buyer shall have received a
certificate signed on behalf of Ravenna by the Chief Executive Officer and the
Chief Financial Officer of Ravenna to such effect.
(c) No Burdensome Condition. None of the Requisite Regulatory Approvals
-----------------------
shall impose any term, condition or restriction upon Buyer, Ravenna, the
Surviving Entity or any of their respective Subsidiaries that Buyer, in good
faith, reasonably determines would so materially adversely affect the economic
or business benefits of the transactions contemplated by this Agreement to Buyer
or Ravenna as to render inadvisable in the reasonable good faith judgment of
Buyer, the consummation of the Merger (a "Burdensome Condition").
(d) Consents Under Agreements. The consent, approval or waiver of each
-------------------------
person (other than the Governmental Entities) whose consent or approval shall be
required in order to permit the succession by the Surviving Entity pursuant to
the Merger, to any obligation, right or interest of Ravenna or any Subsidiary of
Ravenna under any loan or credit agreement, note, mortgage, indenture, lease,
license or other agreement or instrument shall have been obtained, except where
the failure to obtain such consent, approval or waiver would not so materially
adversely affect the economic or business benefits of the transactions
contemplated by this Agreement to Buyer as to render inadvisable, in the
reasonable good faith judgment of Buyer, the consummation of the Merger.
(e) No Pending Governmental Actions. No proceeding initiated by any
-------------------------------
Governmental Entity seeking an Injunction shall be pending.
(f) Federal Tax Opinion. Buyer shall have received an opinion of Xxxxxx
-------------------
Xxxxx LLP, counsel to Buyer ("Buyer's Counsel"), in form and substance
reasonably satisfactory to Buyer, substantially to the effect that, on the basis
of facts, representations and assumptions set forth in such opinion which are
consistent with the state of facts existing at the Effective Time, the Merger
will be treated as a reorganization within the meaning of Section 368(a) of the
Code and that, accordingly, for federal income tax purposes:
(i) No gain or loss will be recognized by the Buyer as a result
of the Merger;
(ii) No gain or loss will be recognized by the Association as a
result of the Merger;
(iii) No gain or loss will be recognized by Ravenna as a result
of the Merger;
(iv) No gain or loss will be recognized by the shareholders of
Ravenna who exchange all of their Ravenna Common Stock solely for Buyer Common
Stock pursuant to the Merger (except with respect to cash received in lieu of a
fractional share interest in Buyer Common Stock);
(v) The aggregate tax basis of the Buyer Common Stock received
by shareholders who exchange all of their Ravenna Common Stock solely for Common
Stock pursuant to the Merger will be the same as the aggregate tax basis of
Ravenna Common Stock surrendered in exchange therefor (reduced by any amount
allocable to a fractional share interest for which cash is received).
In rendering such opinion, the Buyer's Counsel may require and rely upon
representations and covenants contained in certificates of officers of Buyer,
Ravenna, and others, including certain shareholders of Ravenna.
(g) Legal Opinion. Buyer shall have received the opinion of Squire,
-------------
Xxxxxxx & Xxxxxxx, counsel to Ravenna ("Ravenna's Counsel"), dated the Closing
Date, substantially in the form attached hereto as Exhibit 7.2(g). As to any
matter in such opinion which involves matters of fact or matters relating to
laws other than Federal securities or Ohio corporate and banking law, such
counsel may rely upon the certificates of officers and directors of Ravenna and
of public officials and opinions of local counsel, reasonably acceptable to
Buyer, provided a copy of such reliance opinion shall be attached as an exhibit
to the opinion of such counsel.
(h) Accountant's Letter. Ravenna shall have caused to be delivered to
-------------------
Buyer (at Buyer's expense) letters from KPMG Peat Marwick LLP, independent
public accountants with respect to Ravenna, dated the date on which the
Registration Statement or last amendment thereto shall become effective, and
dated the date of the Closing, and addressed to Buyer, with respect to Ravenna's
consolidated financial position and results of operations, which letters shall
be based upon agreed upon procedures to be specified by Buyer, which procedures
shall be consistent with applicable professional standards for
letters delivered by independent accountants in connection with comparable
transactions; provided, however, that if the Merger is terminated, all costs
incurred in connection with the preparation of such letters shall be borne by
the Buyer.
7.3 Conditions to Obligations of Ravenna. The obligation of Ravenna to
------------------------------------
effect the Merger is also subject to the satisfaction or waiver by Ravenna at or
prior to the Effective Time of the following conditions:
(a) Representations and Warranties. The representations and warranties of
------------------------------
Buyer set forth in this Agreement shall be true and correct in all material
respects as of the date of this Agreement and as of the Closing Date as though
made on and as of the Closing Date Ravenna shall have received a certificate
signed on behalf of Buyer by the Chief Executive Officer and the Chief Financial
Officer of Buyer to the foregoing effect.
(b) Performance of Obligations of Buyer. Buyer shall have performed in
-----------------------------------
all material respects all obligations required to be performed by it under this
Agreement at or prior to the Closing Date, and Ravenna shall have received a
certificate signed on behalf of Buyer by the Chief Executive Officer and the
Chief Financial Officer of Buyer to such effect.
(c) Consents Under Agreements. The consent, approval or waiver of each
-------------------------
person (other than the Governmental Entities) whose consent or approval shall be
required in order to permit the succession by the Surviving Entity pursuant to
the Merger, to any obligation, right or interest of the Buyer or any Subsidiary
of the Buyer under any loan or credit agreement, note, mortgage, indenture,
lease, license or other agreement or instrument shall have been obtained, except
those for which failure to obtain such consent, approval or waiver would not so
materially adversely affect the economic or business benefits of the
transactions contemplated by this Agreement to Buyer as to render inadvisable,
in the reasonable good faith judgment of the Buyer, the consummation of the
Merger.
(d) No Pending Governmental Actions. No proceeding initiated by any
-------------------------------
Governmental Entity seeking an injunction shall be pending.
(e) Federal Tax Opinion. Ravenna shall have received an opinion of
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Ravenna's Counsel, in form and substance satisfactory to Ravenna, dated as of
the Effective Time, substantially to the effect as set forth in Section 7.2(f)
hereof.
(f) Legal Opinion. Ravenna shall have received the opinion of Buyer's
-------------
Counsel, dated the Closing Date, substantially in the form attached hereto as
Exhibit 7.3(f). As to any matter in such opinion which involves matters of fact
or matters relating to laws other than Federal securities law or Delaware
corporate law, such counsel may rely upon the certificates of officers and
directors of Buyer and of public officials and opinions of local counsel,
reasonably acceptable to Ravenna, provided a copy of such reliance opinions
shall be attached as an exhibit to the opinion of such counsel.
ARTICLE VIII
TERMINATION AND AMENDMENT
8.1 Termination. This Agreement may be terminated at any time prior to
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the Effective Time, whether before or after approval of the matters presented in
connection with the Merger by the stockholders of Ravenna:
(a) by mutual consent of Ravenna and Buyer in a written instrument, if the
Board of Directors of each so determines by a vote of a majority of the members
of its entire Board;
(b) by either Buyer or Ravenna upon written notice to the other party (i)
60 days after the date on which any request or application for a Requisite
Regulatory Approval shall have been denied or withdrawn at the request or
recommendation of the Governmental Entity which must grant such Requisite
Regulatory Approval, unless within the 60-day period following such denial or
withdrawal a petition for rehearing or an amended application has been filed
with the applicable Governmental Entity, provided, however, that no party shall
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have the right to terminate this Agreement pursuant to this Section 8.1(b)(i) if
such denial or request or recommendation for withdrawal shall be due to the
failure of the party seeking to terminate this Agreement to perform or observe
the covenants and agreements of such party set forth herein or (ii) if any
Governmental Entity of competent jurisdiction shall have issued a final
nonappealable order enjoining or otherwise prohibiting the consummation of any
of the transactions contemplated by this Agreement;
(c) by either Buyer or Ravenna if the Merger shall not have been
consummated on or before June 30, 2000, unless the failure of the Closing to
occur by such date shall be due to the failure of the party seeking to terminate
this Agreement to perform or observe the covenants and agreements of such party
set forth herein;
(d) by either Buyer or Ravenna (provided that the terminating party shall
not be in material breach of any of its obligations under Section 6.3) if
approval of the stockholders of Ravenna or Buyer required for the consummation
of the Merger shall not have been obtained by reason of the failure to obtain
the required vote at a duly held meeting of such stockholders or at any
adjournment or postponement thereof;
(e) by either Buyer or Ravenna (provided that the terminating party is not
then in material breach of any representation, warranty, covenant or other
agreement contained herein) if there shall have been a material breach of any of
the representations or warranties set forth in this Agreement on the part of the
other party, which breach is not cured within thirty days following written
notice to the party committing such breach, or which breach, by its nature,
cannot be cured prior to the Closing
(f) by either Buyer or Ravenna (provided that the terminating party is not
then in material breach of any representation, warranty, covenant or other
agreement contained herein) if there shall have been a material breach of any of
the covenants or agreements set forth in this Agreement on the part of the other
party, which breach shall not have been cured within thirty days following
receipt by the breaching party of written notice of such breach from the other
party hereto;
(g) by Buyer, if the Board of Directors of Ravenna does not recommend in
the proxy materials that Ravenna's stockholders approve and adopt this Agreement
or if, after recommending in the proxy materials that stockholders approve and
adopt this Agreement, the Board of Directors of Ravenna shall have withdrawn,
modified or amended such recommendation in any respect materially adverse to
Buyer;
(h) by Ravenna, if (i) the Average Price (as defined below) for the
twenty consecutive trading days ending on the fifth trading day prior to the
Closing Date (the Average Price during such twenty day period hereinafter
referred to as the "Trigger Price") is less than $9.00 and (ii) the change
(expressed as a percentage) in the Average Price during the period beginning on
the date of this Agreement and ending on the fifth trading day prior to the
Closing Date (the "Trigger Period") exceeds by more than 5.0% the change
(expressed as a percentage) in the value of the SNL Securities Thrift Index
during the Adjustment Period; provided, however, that, if Ravenna elects to
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terminate this Agreement pursuant to this Section 8.1(h), Buyer may, at its
election, adjust the Exchange Ratio to a number of shares equal to $18,400
divided by the Trigger Price and rounded to the nearest whole number. If Buyer
elects to adjust the Exchange Ratio pursuant to this Section 8.1(h), then
Ravenna shall no longer have the right to terminate the Agreement pursuant to
this Section 8.1(h). As used herein the term "Average Price" means, for the
period of calculation, the average of the daily closing bid and ask price per
share of Buyer Common Stock reported on the Nasdaq National Market System during
such period. As an example of this Section 8.1(h), and for purposes of
illustration only, if the Average Price during the Trigger Period drops to $8.75
from $11.00 (a drop in value of 25.7%) and the drop in value in the SNL
Securities Thrift Index during the Trigger Period is 20% then Ravenna would have
the right to terminate unless Buyer elected to increase the Exchange Ratio to
2,103 shares ($18,400 divided by $8.75 = 2,102.8571, adjusted to 2,103).
8.2 Effect of Termination; Expenses.
-------------------------------
(a) In the event of termination of this Agreement by either Buyer or
Ravenna as provided in Section 8.1, this Agreement shall forthwith become void
and have no effect except (i) the last sentence of Section 6.2(a), and Sections
6.2(c), 6.2(d), 8.2 and 9.4, shall survive any termination of this Agreement,
(ii) that notwithstanding anything to the contrary contained in this Agreement,
no party shall be relieved or released from any liabilities or damages arising
out of its willful breach of any provision of this Agreement, (iii) in the event
this Agreement is terminated by either Buyer or Ravenna pursuant to Section
8.1(e) or (f), then the terminating party shall receive from the other party, in
addition to any other amounts payable by such party pursuant to this Agreement,
its reasonable costs and expenses incurred in connection with the transactions
contemplated by this Agreement not to exceed $75,000, and (iv) in the event (i)
this Agreement is terminated by Buyer pursuant to Section 8.1(d) or (g) hereof
and (ii) within 12 months after such termination by Buyer a Purchase Event (as
defined below) shall occur, then in addition to any other amounts payable by
Ravenna pursuant to this Agreement, Ravenna shall pay to Buyer a termination fee
of $1,000,000.
(b) As used herein, the term "Purchase Event" means any of the following
events:
(i) Ravenna shall have authorized, recommended, publicly proposed or
entered into an agreement with any person (other than Buyer or any affiliate of
Buyer or any
person acting in concert with Buyer) to effect an Acquisition Transaction (as
defined below). As used herein, the term "Acquisition Transaction" shall mean
(A) a merger, consolidation or similar transaction involving Ravenna or its
Subsidiary (other than internal mergers, reorganizations, consolidations or
dissolution involving only existing Subsidiaries), (B) the disposition, by sale,
lease, exchange or otherwise, of assets of Ravenna or its Subsidiary
representing 25% or more of the consolidated assets of Ravenna or its Subsidiary
(other than the sale of loans or mortgage servicing rights in the ordinary
course of business consistent with past practices) or (C) the issuance, sale or
other disposition of (including by way of merger, consolidation, share exchange
or any similar transaction) securities representing 25% or more of the voting
power of Ravenna or its Subsidiary;
(ii) any person (other than a current Ravenna stockholder, Buyer or any
affiliate of Buyer or any person acting in concert in any respect with Buyer)
shall have acquired Beneficial Ownership (as such term is defined in Rule 13d-3
promulgated under the Exchange Act) of, or the right to acquire Beneficial
Ownership of, or any Group (as such term is defined under the Exchange Act)
shall have been formed which shall have acquired Beneficial Ownership of, or the
right to acquire Beneficial Ownership of, 25% or more of the then outstanding
shares of Ravenna Common Stock;
(iii) any person (other than a current Ravenna stockholder, Buyer or any
affiliate of Buyer or any person acting in concert in any respect with Buyer)
shall have commenced (as such term is defined in Rule 14d-2 under the Exchange
Act) or shall have filed a registration statement under the Securities Act with
respect to, a tender offer or exchange offer to purchase any shares of Ravenna
Common Stock and, upon consummation of such offer, such person owns or controls
a majority of the then outstanding shares of Ravenna Common Stock (such an offer
being referred to herein as a "Tender Offer" or an "Exchange Offer,"
respectively);
8.3 Amendment. Subject to compliance with applicable law, this Agreement
---------
may be amended by the parties hereto, by action taken or authorized by their
respective Boards of Directors, at any time before or after approval of the
matters presented in connection with the Merger by the stockholders of Ravenna
or of Buyer, if such approval is required by law or regulation; provided,
--------
however, that after any approval of the transactions contemplated by this
-------
Agreement by Ravenna's stockholders, there may not be, without further approval
of such stockholders, any amendment of this Agreement which reduces the amount
or changes the form of the consideration to be delivered to Ravenna stockholders
hereunder other than as contemplated by this Agreement. This Agreement may not
be amended except by an instrument in writing signed on behalf of each of the
parties hereto.
8.4 Extension; Waiver. At any time prior to the Effective Time, the
-----------------
parties hereto, by action taken or authorized by their respective Board of
Directors, may, to the extent legally allowed, (a) extend the time for the
performance of any of the obligations or other acts of the other parties hereto,
(b) waive any inaccuracies in the representations and warranties contained
herein or in any document delivered pursuant hereto and (c) waive compliance
with any of the agreements or conditions contained herein. Any agreement on the
part of a party hereto to any such extension
or waiver shall be valid only if set forth in a written instrument signed on
behalf of such party, but such extension or waiver or failure to insist on
strict compliance with an obligation, covenant, agreement or condition shall not
operate as a waiver of, or estoppel with respect to, any subsequent or other
failure.
ARTICLE IX
GENERAL PROVISIONS
9.1 Closing. Subject to the terms and conditions of this Agreement, the
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closing of the Merger (the "Closing") will take place at 10:00 a.m. on a date to
be specified by the parties, which shall be the first day which is (a) the last
business day of a month and (b) at least two business days after the
satisfaction or waiver (subject to applicable law) of the latest to occur of the
conditions set forth in Article VII hereof (the "Closing Date"), at the offices
of Buyer's counsel unless another time, date or place is agreed to in writing by
the parties hereto.
9.2 Alternative Structure. Notwithstanding anything to the contrary
---------------------
contained in this Agreement, subject to Ravenna's consent, which consent shall
not be unreasonably withheld, prior to the Effective Time, Buyer shall be
entitled to revise the structure of the Merger and related transactions provided
that each of the transactions comprising such revised structure shall (i) fully
qualify as, or fully be treated as part of, one or more tax-free reorganizations
within the meaning of Section 368(a) of the Code, and not subject any of the
stockholders of Ravenna to adverse tax consequences or change the amount of
consideration to be received by such stockholders, (ii) be capable of
consummation in as timely a manner as the structure contemplated herein and
(iii) not otherwise be prejudicial to the interests of the stockholders of
Ravenna. This Agreement and any related documents shall be appropriately amended
in order to reflect any such revised structure.
9.3 Nonsurvival of Representations, Warranties and Agreements. None of
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the representations, warranties, covenants and agreements in this Agreement or
in any instrument delivered pursuant to this Agreement shall survive the
Effective Time, except for those covenants and agreements contained herein and
therein which by their terms apply in whole or in part after the Effective Time.
9.4 Expenses. All costs and expenses incurred in connection with this
--------
Agreement and the transactions contemplated hereby shall be paid by the party
incurring such expense, provided, however, that all filing and other fees paid
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to the SEC or any other Governmental Entity in connection with the Merger, and
other transactions contemplated thereby shall be borne by the Buyer; provided,
--------
further, however, that nothing contained herein shall limit either party's
------- -------
rights to recover any liabilities or damages arising out of the other party's
willful breach of any provision of this Agreement.
9.5 Notices. All notices and other communications hereunder shall be in
-------
writing and shall be deemed given if delivered personally, telecopied (with
confirmation), mailed by registered or certified mail (return receipt requested)
or delivered by an express courier (with confirmation) to the parties at the
following addresses (or at such other address for a party as shall be specified
by like notice):
(a) if to Buyer, to:
First Place Financial Corp.
000 Xxxx Xxxxxx Xxxxxx
Xxxxxx, Xxxx 00000
Attention: Xxxxxx X. Xxxxx
President and Chief Executive Officer
with a copy to:
Xxxxxx Xxxxx LLP
0000 X Xxxxxx, X.X.
Xxxxxxxxxx, X.X. 00000
Attention: Xxxxxx X. Passaic, Jr.
and
(b) if to Ravenna
Ravenna Savings Bank
000 Xxxx Xxxx Xxxxxx
Xxxxxxx, Xxxx 00000
Attention: Xxxx X. Xxxxxxx
President and Chief Executive Officer
with copies to:
Xxxx & Xxxxxx, CPAs, Inc.
0000 Xxxxxxxxx Xxxxx
Xxxxxxxx, Xxxx 00000
Attention: D. Xxx Xxxxxx
and
Squire, Xxxxxxx & Xxxxxxx
0000 Xxx Xxxxx
000 Xxxxxx Xxxxxx
Xxxxxxxxx, Xxxx 00000
Attention: Xxxx Xxxxxxxx Xxxxxx
9.6 Interpretation. When a reference is made in this Agreement to
--------------
Sections, Exhibits or Schedules, such reference shall be to a Section of or
Exhibit or Schedule to this Agreement unless otherwise indicated. The headings
contained in this Agreement are for reference purposes only and shall not affect
in any way the meaning or interpretation of this Agreement. Whenever the words
"include", "includes" or "including" are used in this Agreement, they shall be
deemed to be followed by the words "without limitation". The phrases "the date
of this Agreement", "the date hereof" and terms of similar import, unless the
context otherwise requires, shall be deemed to refer to November 22, 1999.
9.7 Counterparts. This Agreement may be executed in counterparts, all of
------------
which shall be considered one and the same agreement and shall become effective
when counterparts have been signed by each of the parties and delivered to the
other parties, it being understood that all parties need not sign the same
counterpart.
9.8 Entire Agreement. This Agreement (including the documents and the
----------------
instruments referred to herein) constitutes the entire agreement and supersedes
all prior agreements and understandings, both written and oral, among the
parties with respect to the subject matter hereof.
9.9 Governing Law. This Agreement shall be governed and construed in
-------------
accordance with the laws of the States of Delaware and Ohio, as applicable,
without regard to any applicable conflicts of law.
9.10 Enforcement of Agreement. The parties hereto agree that irreparable
------------------------
damage would occur in the event that the provisions contained in the last
sentence of Section 6.2(c) and in Section 6.2(d) of this Agreement were 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 the last sentence of Section 6.2(c) and
Section 6.2(d) of this Agreement and to enforce specifically the terms and
provisions thereof 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.
9.11 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.
9.12 Publicity. Except as otherwise required by law or the rules of the
---------
Nasdaq National Market, so long as this Agreement is in effect, neither Buyer
nor Ravenna shall, or shall permit any of its Subsidiaries to, issue or cause
the publication of any press release or other public announcement with respect
to, or otherwise make any public statement concerning, the transactions
contemplated by this Agreement without the consent of the other party, which
consent shall not be unreasonably withheld.
9.13 Assignment; No Third Party Beneficiaries. Neither this Agreement nor
----------------------------------------
any of the rights, interests or obligations hereunder shall be assigned by any
of the parties hereto (whether by operation of law or otherwise) without the
prior written consent of the other parties. 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. Except as otherwise
expressly provided herein, this Agreement (including the documents and
instruments referred to herein) is not intended to confer upon any person other
than the parties hereto any rights or remedies hereunder.
IN WITNESS WHEREOF, Buyer, the Association and Ravenna have caused this
Agreement to be executed by their respective officers thereunto duly authorized
as of the date first above written.
FIRST PLACE FINANCIAL CORP.
By: /s/ Xxxxxx X. Xxxxx
---------------------------
Name: Xxxxxx X. Xxxxx
Title: President and Chief Executive Officer
Attest: /s/ Xxxxxxxxx Xxxxxxx
-----------------------
Name: Xxxxxxxxx Xxxxxxx
FIRST FEDERAL SAVINGS AND LOAN
ASSOCIATION OF XXXXXX
Attest: /s/ Xxxxxxxxx Xxxxxxx By: /s/ Xxxxxx X. Xxxxx
----------------------- ----------------------------
Name: Xxxxxxxxx Xxxxxxx Name: Xxxxxx X. Xxxxx
President and Chief Executive Officer
RAVENNA SAVINGS BANK
By: /s/ Xxxx X. Xxxxxxx
---------------------------
Name: Xxxx X. Xxxxxxx
Title: President and Chief Executive Officer
Attest: /s/ D. Xxx Xxxxxx
------------------
Name: D. Xxx Xxxxxx
Corporate Secretary
