EXHIBIT 10.12
STOCK PURCHASE AGREEMENT
AMONG
BANK OF THE OZARKS, INC.,
HEARTLAND COMMUNITY BANK,
Camden, Arkansas,
AND
HCB BANCSHARES, INC.
DATED: NOVEMBER 19, 1997
INDEX
TO
STOCK PURCHASE AGREEMENT
1. The Purchase..................................... 1
(a) Purchase and Sale of Stock....................... 1
(b) Purchase and Assumption of Assets and Liabilities 2
(c) Retained Assets.................................. 2
(d) Retained Liabilities............................. 2
(e) Books, Records, Policies and Other Materials..... 3
(f) Proration of Seller Liabilities.................. 3
2. Purchase Price................................... 4
(a) Holding Company Stock............................ 4
(b) Purchase and Assumption.......................... 4
3. Closing.......................................... 4
(a) Closing Date..................................... 4
(b) Pre-Closing Balance Sheet........................ 4
(c) Payments at Closing.............................. 4
(d) Closing Documents................................ 5
(e) Post-Closing Balance Sheet....................... 6
4. Representation and Warranties of Seller and HCB.. 8
(a) Organization..................................... 8
(b) Capitalization of Holding Company................ 8
(c) Holding Company Shareholder...................... 8
(d) Capitalization of Bank........................... 9
(e) Title to Bank Stock.............................. 9
(f) Authority; Validity of Agreement................. 9
(g) No Violation, Consents and Approval.............. 9
(h) Financial Reports and Statements................. 10
(i) Bank Premises.................................... 10
(j) Reserved......................................... 11
(k) Claims........................................... 11
(l) Employment Contracts............................. 11
(m) Benefit Plans.................................... 11
(n) Agreements, Commitments and Certain Loans........ 12
(o) Litigation....................................... 12
(p) Tax and other Returns, Reports
and Agreements................................. 12
(q) Legal and Regulatory Compliance.................. 13
(r) Insurance........................................ 14
(s) Environmental Compliance......................... 15
(t) Certain Transactions............................. 15
(u) Subsidiaries..................................... 15
(v) Corporate Records................................ 15
(w) Disclosure....................................... 15
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5. Representations and Warranties of Buyer.......... 15
(a) Organization..................................... 16
(b) Authorization and Validity of Agreement.......... 16
(c) Investment....................................... 16
6. Covenants of HCB, Seller and Buyer............... 16
(a) Preservation of the Business..................... 16
(b) Access........................................... 17
(c) Best Efforts..................................... 18
(d) Public Announcements............................. 18
(e) Dividend......................................... 18
(f) Closing Net Worth, Indebtedness and Liabilities.. 18
(g) Name Change; Cooperation Regarding Applications.. 19
(h) Transition of Customer Accounts and Files........ 19
(i) Employees and Employee Benefit Plans............. 23
(j) Exclusivity...................................... 23
(k) Certain Notifications............................ 24
(l) Taxes and Reports................................ 24
(m) Deposit Products; Investment of Funds and Loans.. 27
(n) Insurance........................................ 27
7. Closing Conditions............................... 27
(a) Conditions to Obligations of Parties............. 27
(b) Conditions to Obligations of Buyer............... 28
(c) Conditions to Obligations of HCB and Seller...... 31
8. Survival and Indemnification..................... 31
(a) Survival of Representations, Warranties
and Covenants.................................... 32
(b) Indemnification.................................. 32
9. Termination, Waiver, Extension and Agreement..... 33
(a) Termination...................................... 33
(b) Willful Breach of Intentional Misrepresentation.. 33
(c) No Willful Breach or Intentional
Misrepresentation.............................. 33
(d) Waiver, Extension and Amendment.................. 34
10. Miscellaneous.................................... 34
(a) Broker's or Finder's Fees........................ 34
(b) Confidentiality.................................. 34
(c) Expenses......................................... 35
(d) Notices.......................................... 35
(e) Entire Agreement................................. 36
(f) Binding Effect................................... 36
(g) Further Assurances............................... 36
(h) Knowledge and Investigation...................... 36
(i) Construction..................................... 36
(j) Counterparts..................................... 36
(k) Section Headings................................. 36
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STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT (the "Agreement") is made as of this 19th day
of November, 1997, among BANK OF THE OZARKS, INC., an Arkansas corporation
("Buyer"), Heartland Community Bank, Camden, Arkansas, a federal savings bank
("Seller") and HCB Bancshares, Inc., an Oklahoma corporation ("HCB").
W I T N E S S E T H:
WHEREAS, HCB owns of record and beneficially 100% of the issued and
outstanding common stock of Seller;
WHEREAS, Seller owns of record and beneficially 1000 shares of the
outstanding common stock, par value $20 per share (the "Holding Company Stock")
of Heritage Banc Holding, Inc., an Arkansas corporation (the "Holding Company")
which shares represent all of the issued and outstanding capital stock of the
Holding Company;
WHEREAS, the Holding Company owns of record and beneficially 33,400 shares
of common stock, par value $7.50 per share (the "Bank Stock"), of Heartland
Community Bank, FSB, a federal stock savings bank (the "Bank"), which shares
represent all of the issued and outstanding capital stock of the Bank;
WHEREAS, the Bank's sole offices are its home office located at 000 Xxxxx
Xxxxxxx, Xxxxxx Xxxx, Xxxxxxxx (the "Main Office"), a full service branch office
located at 000 Xxxxxxx 000 Xxxxx, Xxxxxxxxxx, Xxxxxxxx (the "Monticello Branch")
and a loan production office located at 00000 X-00, #00, Xxxxxx, Xxxxxxxx (the
"LPO Office");
WHEREAS, this Agreement contemplates a transaction pursuant to which (i)
Buyer will acquire from Seller the Holding Company Stock and (ii) Seller will
purchase and assume certain assets and liabilities of the Bank (collectively the
"Acquisition Transaction"); and
WHEREAS, the Seller desires to sell the Holding Company Stock and the Buyer
desires to purchase the Holding Company Stock subject to the terms and
conditions of this Agreement.
NOW, THEREFORE, in consideration of the premises, the mutual promises,
representations, covenants and actions hereinafter set forth and good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto, each intending to be legally bound hereby,
agree as follows:
1. The Purchase.
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(a) Purchase and Sale of Stock. Subject to the terms and conditions
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set forth herein, at the Closing (as defined below), Seller shall sell, transfer
and deliver, free and clear of all liens and encumbrances, and Buyer shall
purchase and acquire, all
of the shares of Holding Company Stock which are and shall be issued and
outstanding on the Closing Date (as defined below).
(b) Purchase and Assumption of Assets and Liabilities.
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As a pre-condition to the purchase of the Holding Company Stock by Buyer
pursuant to Section 1(a), Seller shall on the Closing Date purchase all of the
assets, other than Retained Assets (as defined below) (the "Seller Assets") and
assume all of the liabilities, other than Retained Liabilities (as defined
below) (the "Seller Liabilities") of the Bank pursuant to the terms and
conditions of that certain Purchase and Assumption Agreement (the "P&A
Agreement") dated as of the date hereof, a copy of which is attached to this
Agreement as Exhibit "A". The Seller Assets are being transferred by the Bank
to Seller on an "as is" basis without any recourse, representation or warranty
(including, but not limited to, representations or warranties as to quality,
condition, title or compliance with laws, rules or regulations of Regulatory
Authorities (as defined below)). The Seller Liabilities are being assumed by
the Seller without recourse or any representation or warranty as to amount or
compliance with laws, rules or regulations of Regulatory Authorities.
(c) Retained Assets. For purposes of this Agreement and the P&A
---------------
Agreement, the term "Retained Assets" shall mean the following assets owned by
the Bank: (i) all real property constituting the Main Office and all
improvements, fixtures and fittings thereon, and any easements, rights of way
and other appurtenants thereto (such as appurtenant rights in and to public
streets), (ii) all tangible personal property (other than computer hardware and
software used in connection with Seller's existing data processing system)
located at the Main Office, including the personal property described on Exhibit
"B" hereto, (iii) goodwill, and (iv) cash, Federal Home Loan Bank balances and
federal funds deposits. The amount of Retained Assets shall be accurately
reflected on the Pre-Closing Balance Sheet (as defined below) of the Bank as of
the Pre-Closing Balance Sheet Date (as defined below), which such Pre-Closing
Balance Sheet is being delivered by Seller pursuant to Section 3(b).
(d) Retained Liabilities. For purposes of this Agreement and the P&A
--------------------
Agreement, the term "Retained Liabilities" shall mean (i) the deposits (other
than Excluded Deposits, as defined below) associated solely with the Main
Office, plus accrued interest thereon and (ii) all accrued and unpaid salaries
of employees located at the Main Office, payroll and property taxes and other
accrued liabilities associated with the Retained Assets and the operation of and
personnel located at the Main Office. The term "Excluded Deposits" shall mean
all deposits identified by Buyer on Annex I, which Annex may be modified or
supplemented by the mutual agreement of Buyer and Seller no later than three
business days prior to the Closing Date. All liabilities,
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obligations or commitments (contingent or otherwise) of the Bank other than
Retained Liabilities shall constitute Seller Liabilities. The amount of
Retained Liabilities shall be accurately reflected on the Pre-Closing Balance
Sheet as of the Pre-Closing Balance Sheet Date, which such balance sheet is
being delivered by Seller pursuant to Section 3(b).
(e) Books, Records, Policies and Other Materials. In addition to
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the Retained Assets, the following items will remain in the possession and
ownership of the Bank and the Holding Company, following the Closing: (i) all
lists, studies, reports and other printed or written materials relating to the
operation of the Main Office, (ii) all approvals, permits, licenses,
registrations, certificates, variances and similar rights and all exams and
reports obtained from government and governmental agencies relating to the
operation of the Bank, the Holding Company or the Main Office, (iii) all deposit
agreements, signature cards, change of address notifications and other
documentation or correspondence related to the deposits which are included in
Retained Liabilities; (iv) the Bank's and the Holding Company's charter, ABA
transit routing number, telephone number, and all qualifications to do business,
taxpayer and other identification numbers, minute books, stock transfer books,
blank stock certificates, general corporate documents and other books, records
and documents relating to the organization, maintenance and operation of the
Bank and the Holding Company, and (v) subject to Section 6(n), the rights and
benefits inuring to the Bank and Holding Company under policies evidencing all
insurance, fiduciary bonds or similar coverage.
(f) Proration of Seller Liabilities. The parties intend that Bank
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shall operate for its own account the business conducted at the Monticello
Branch and the LPO Office until the start of business on the Closing Date, and
that the Seller shall operate such business for its own account on and after the
Closing Date. Thus, except as otherwise specifically provided in this Agreement,
items of expense directly attributable to the operation of the Monticello Branch
and the LPO Office (which shall not include any general overhead expenses of
Bank) and which are not readily capable of determination as of the Closing Date
shall be prorated as of the start of business on the Closing Date, whether or
not such adjustment would normally be made as of such time, including without
limitation, personal (but not real) property taxes and any assessments
attributable to FDIC deposit insurance attributable to the deposits included in
the Seller Liabilities (such net amount being hereinafter referred to as the
"Proration Amount"). Items which are readily capable of determination as of the
Closing Date, including telephone, electric, gas and other utility services at
the Monticello Branch the LPO Office shall not be prorated; instead, Bank and
Seller shall make arrangements for the responsibility for payment of such
services on or after the start
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of business on the Closing Date to be transferred to the Seller as of the
Closing Date.
2. Purchase Price.
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(a) Holding Company Stock. The purchase price for the Holding
---------------------
Company Stock shall be a total of $3,100,000 (the "Stock Purchase Price").
(b) Purchase and Assumption. The purchase price to be paid by Seller
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for the Seller Assets being purchased by Seller pursuant to the P&A Agreement
shall be an amount equal to the sum of the book value of such assets, plus
----
$450,000, minus the book value of the Seller Liabilities, all as of the Pre-
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Closing Balance Sheet Date (the "Asset Purchase Price").
3. Closing
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(a) Closing Date. The closing of the purchase and assumption of the
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Seller Assets and Seller Liabilities by the Seller and the closing of the
purchase of the Holding Company Stock by Buyer (collectively, the "Closing")
shall take place at a mutually agreed time and place on (i) the first Monday to
occur after the date on which all conditions specified in Section 7 hereof have
been satisfied or waived, or if such Monday is not a business day, the next
succeeding business day, or (ii) such other date as Seller and Buyer may
mutually agree. The date of the Closing is hereinafter referred to as the
"Closing Date."
(b) Pre-Closing Balance Sheet. No later than the Saturday
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immediately preceding the Closing Date (the "Pre-Closing Date"), Seller shall
deliver to Buyer copies of a consolidated balance sheet of the Bank and the
Holding Company (the "Pre-Closing Balance Sheet"), certified and signed by the
Seller, reflecting the Retained Assets, Retained Liabilities and the
shareholders' equity of the Bank and the Holding Company as of midnight on the
day immediately preceding the Closing Date (the "Pre-Closing Balance Sheet
Date"). Such Pre-Closing Balance Sheet shall (i) be true and correct in all
material respects, fairly present the assets, liabilities and stockholders'
equity of the Bank and the Holding Company and be prepared in accordance with
generally accepted accounting principles ("GAAP"), except with respect to
variations from GAAP (A) that may result from compliance with any provisions of
this Agreement, including, but not limited to, Section 6(n), and (B) with
respect to the amount of goodwill included therein, (ii) be determined after
giving effect on a pro forma basis to the completion of the purchase and
assumption of the Seller Assets and Seller Liabilities pursuant to the P&A
Agreement, (iii) include through midnight on the Pre-Closing Balance Sheet Date
all accruals for amortization, interest expense, interest income, salaries,
payroll and property taxes and other accrued liabilities associated
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with the Retained Assets and the operation of, and personnel located at, the
Main Office, (iv) include as attachments (A) a trial balance of all deposits as
of midnight on the Pre-Closing Balance Sheet Date and (B) detailed supporting
schedules, (v) exclude the value of any deferred tax assets of the Bank or
Holding Company attributable to any tax periods prior to the Closing (the
"Deferred Tax Assets"), (vi) reflect the Minimum Equity Amount required by
Section 6(f) and (vii) exclude any value attributable to any prepaid insurance
premiums for any insurance policies terminated in accordance with Section 6(n).
(c) Payments at Closing. The Seller and the Buyer agree that the
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following payments shall be made contemporaneously and under their mutual
control on the Closing Date:
(i) Seller and Bank shall settle the Asset Purchase Price by wire
transfer or delivery of other immediately available funds to an account
designated by the Seller or, in the case of amounts to be received by the
Bank, an account designated by the Buyer;
(ii) if applicable, the Seller may cause the Bank and the Holding
Company to pay the dividend specified in Section 6(d) herein by wire
transfer or delivery of other immediately available funds to an account
designated by Seller;
(iii) Buyer shall deliver to Seller the Stock Purchase Price,
adjusted for any Proration Amount, for the Holding Company Stock by wire
transfer or delivery of other immediately available funds to an account
designated by Seller;
(iv) the Seller will deposit or cause to be deposited an amount
equal to the Stock Purchase Price in certificates of deposit, issued in the
name of HCB or the Seller (the "Seller CDs"), by either the Bank or the
state bank subsidiaries of the Buyer (such Seller CDs to be allocated among
such institutions in amounts proportionate to the respective
capitalizations of the institutions). The Seller CDs shall bear interest
at the rate of 5.125% per annum, payable quarterly, and shall be issued in
the denominations and maintain the maturity dates as set forth on Exhibit
"C" hereto.
Amounts paid at Closing shall be subject to subsequent adjustment based on the
Post-Closing Balance Sheet (as defined herein).
(d) Closing Documents. On the Pre-Closing Date, Seller shall deliver
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to Buyer's counsel the following documents: (i) one or more original
certificates representing the Holding Company
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Stock, duly endorsed for transfer to the Buyer and accompanied by separate stock
powers in blank, free and clear of all encumbrances, liens, security interests,
claims and equities whatsoever, (ii) original certificates representing the Bank
Stock issued in the name of the Holding Company free and clear of all
encumbrances, liens, security interests, claims and equities whatsoever, (iii) a
certificate of the President and Chief Financial Officer of Seller to the effect
that the Pre-Closing Balance Sheet is true and correct in all material respects
and was prepared in accordance with Section 3(b), and (iv) such other documents,
including the legal opinions and closing certificates referenced in Section 7,
as may be required by this Agreement or reasonably requested by the Buyer. On
the Pre-Closing Date, the Buyer agrees to deliver to the Seller's counsel such
documents, including the legal opinions and closing certificates referenced in
Section 7, as may be required by this Agreement or reasonably requested by the
Seller. Each of the Seller and Buyer acknowledge that their counsels shall not
be authorized to release the Closing documents to the respective parties until
the parties have received confirmation of the payments set forth in Section
3(c).
(e) Post-Closing Balance Sheet.
--------------------------
(i) Not later than 15 business days after the Closing Date (the
"Post-Closing Balance Sheet Delivery Date"), Seller shall deliver to
Buyer copies of a consolidated balance sheet of the Bank and the
Holding Company, certified and signed by Seller, reflecting the
Retained Assets, Retained Liabilities, and the shareholders' equity of
the Bank and the Holding Company as of midnight on the Pre-Closing
Balance Sheet Date (the "Post-Closing Balance Sheet"). Such Post-
Closing Balance Sheet shall (i) be true and correct in all material
respects, fairly present the assets, liabilities and stockholders'
equity of the Bank and the Holding Company and shall be prepared in
accordance with GAAP, except with respect to variations from GAAP (A)
that may result from compliance with any provisions of this Agreement,
including, but not limited to, Section 6(n), and (B) with respect to
the amount of goodwill included therein, (ii) be determined after
giving effect to the completion of the purchase and assumption of the
Seller Assets and Seller Liabilities pursuant to the P&A Agreement,
(iii) include through midnight on the Pre-Closing Balance Sheet Date
all accruals for amortization, interest expense, interest income,
salaries, payroll and property taxes and other accrued liabilities
associated with the Retained Assets and the operation of, and
personnel located at, the Main Office, (iv) exclude the value of any
Deferred Tax Assets, (v) exclude any value attributable to any prepaid
insurance premiums for any
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insurance policies terminated in accordance with Section 6(n), and
(vi) include as attachments (A) a final trial balance of all deposits
as of midnight on the Pre-Closing Balance Sheet Date and (B) detailed
supporting schedules and (vi) reflect the Minimum Equity Amount
required by Section 6(f).
(ii) Seller shall afford Buyer and its accountants and attorneys
the opportunity to review all work papers and documentation used by
Seller in preparing the Post-Closing Balance Sheet. Within 15
business days following the Post-Closing Balance Sheet Delivery Date
(the "Adjustment Delivery Date"), Seller and Buyer shall meet at the
offices of the Buyer in Little Rock, Arkansas, or such other location
as shall be mutually agreed, to effect the transfer of any funds as
may be necessary to reflect the (A) changes in such assets and
liabilities between the Pre-Closing Balance Sheet and the Post-Closing
Balance Sheet or (B) Minimum Equity Amount, together with interest
thereon computed from the Closing Date to the Adjustment Payment Date
at the applicable Federal Funds Rate (as defined). The "Federal Funds
Rate" shall be the mean of the high and low rates quoted for Federal
Funds in the Money Rates Column of the Wall Street Journal on the
Closing Date.
(iii) In the event that a dispute ("Dispute") arises as to the
payment of the appropriate amounts to be paid to either party on the
Adjustment Payment Date, each party shall pay to the other party on
such Adjustment Payment Date all amounts other than those as to which
a dispute exists. If a Dispute still exists 15 business days after
the Adjustment Payment Date, the Buyer and Seller shall retain Ernst &
Young, LLP, Little Rock (or any successor entity, the "Arbitrating
Accountant") to resolve such Dispute and deliver to the Arbitrating
Accountant a written notice setting forth in reasonable detail the
elements and amounts set forth on the Post-Closing Balance Sheet to
which such party disagrees. In resolving such Dispute, (A) each of
Seller and Buyer agree to provide such workpapers, documentation and
other information relating to the Dispute that are reasonably
requested by the Arbitrating Accountant, (B) the determination by the
Arbitrating Accountants, as set forth in a written notice delivered to
each of the Seller and Buyer, will be binding and conclusive on the
parties and (C) Buyer and Seller will each bear 50% of the fees of the
Arbitrating Accountant for such determination. Any disputed amounts
retained by a party which are later found to be due to the other party
shall be paid to such other party promptly upon resolution with
interest
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thereon computed from the Closing Date to the date paid at the
applicable Federal Funds Rate.
4. Representations and Warranties of Seller and HCB
------------------------------------------------
Seller and HCB jointly and severally represent and warrant to the
Buyer that the following matters are true and correct as of the date hereof and
will be true and correct on the Closing Date. As used in this Agreement, the
term "Legal Requirements" shall mean any federal, state or local law, ruling or
regulation, or the terms of any judgment, decree, order, regulation or rule.
(a) Organization. The Holding Company and the Bank are corporations
------------
duly organized, validly existing and in good standing under the laws of the
jurisdiction under which each is organized and each has all requisite corporate
power and authority to own, lease and operate its properties and to carry on its
business as now being conducted. The Holding Company is duly authorized,
qualified and licensed under all applicable laws, regulations and orders of
public authorities to conduct business as a saving and loan holding company as
presently conducted and to own the Bank Stock. The Bank is duly authorized,
qualified and licensed under all applicable laws and regulations to conduct a
general savings bank business, embracing all usual functions of savings banks,
all subject to the supervision of the Office of Thrift Supervision ("OTS"), and
is a "qualified thrift lender," as such term is defined in the Home Owners' Loan
Act of 1933 ("HOLA"). The accounts of depositors held by the Bank are insured
to the maximum extent permitted by law by the Saving Association Insurance Fund
of the Federal Deposit Insurance Corporation ("FDIC"), and the Bank has paid in
a proper and timely manner all premiums and assessments and filed all reports in
connection therewith.
(b) Capitalization of Holding Company. The authorized capital stock
---------------------------------
of the Holding Company consists of 1,000 shares of common stock, par value
$20.00 per share, all of which are issued and outstanding. All shares of
Holding Company Stock have been duly and validly authorized and issued and are
fully paid and nonassessable. There are no outstanding or authorized
subscriptions, options, warrants, calls, rights, commitments or other agreements
of any character obligating the Holding Company to issue any additional shares
of Holding Company Stock or any other shares of capital stock of the Holding
Company or any other securi ties convertible into or evidencing the right to
subscribe for any shares of Holding Company capital stock, and no authorization
therefor has been given.
(c) Holding Company Shareholder. The Seller owns of record and
---------------------------
beneficially the Holding Company Stock, free and clear of all liens,
encumbrances, equities and claims. There are no
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outstanding options, warrants or rights to subscribe for or purchase from the
Seller any of the Holding Company Stock owned by Seller.
(d) Capitalization of Bank. The authorized capital stock of the Bank
----------------------
consists of 150,000 shares of common stock, par value $7.50 per share, 33,400 of
which are issued and outstanding, and 100,000 shares of preferred stock, par
value $1.00 per share, no shares of which are issued and outstanding. All
shares of Bank Stock have been duly and validly authorized and issued and are
fully paid and nonassessable. There are no outstanding options, warrants or
rights to subscribe for or purchase any of the Bank's capital stock or
securities convertible into or exchangeable for any of the Bank's capital stock,
and no authorization therefor has been given.
(e) Title to Bank Stock. The Holding Company has valid and
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marketable title to the Bank Stock free and clear of all liens, encumbrances,
equities and claims.
(f) Authority; Validity of Agreement. HCB and Seller have all
--------------------------------
requisite power and authority to enter into this Agreement and (subject to
receipt of all requisite regulatory approvals) to consummate the transaction
contemplated hereby. This Agreement has been duly executed and delivered by HCB
and Seller and is a valid and binding obligation of HCB and Seller, enforceable
against HCB and Seller in accordance with its terms, except as (i) such
enforcement may be subject to applicable bankruptcy, insolvency or other laws,
now or hereafter in effect, affecting creditors' rights generally and (ii) the
remedy of specific performance, injunctive and other forms of equitable relief
may be subject to equitable defenses and to the discretion of the court before
which any pro ceedings therefor may be brought.
(g) No Violation, Consents and Approval. Neither the execution and
-----------------------------------
delivery of this Agreement nor the consummation of the transactions contemplated
hereby will: (i) violate any provision of the certificate of incorporation,
bylaws or other organizational documents of HCB, Seller, Holding Company or the
Bank, (ii) violate, constitute a default under or give rise to a right of
termination in respect of any agreement to which HCB, the Seller, the Holding
Company or the Bank is a party or by which any of their respective assets are
bound, (iii) except for requisite regulatory approvals, require any filing with
or permit, consent or approval of any public body or Regulatory Authority, or
(iv) assuming that the Acquisition Transaction receives requisite regulatory
approval, violate any statute or Legal Requirements imposed on or applicable to
HCB, the Seller, the Holding Company or the Bank or any assets owned by them.
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(h) Financial Reports and Statements. The Seller has previously
--------------------------------
caused to be delivered to the Buyer true and complete copies of the "Thrift
Financial Reports", and any amendments thereto, of the Holding Company and Bank
filed with the OTS since January 1, 1994 (collectively the "Financial Reports").
The Financial Reports have been prepared in accordance with all material
Legal Requirements and GAAP consistently applied during the periods indicated,
are true and correct in all material respects and fairly present the assets,
liabilities and financial condition of the Holding Company and the Bank and the
results of operations for the periods indicated. There has been no material
adverse change in the financial position or business operations of the Holding
Company or the Bank since the date of the most recent Financial Reports. The
Pre-Closing Balance Sheet (including the trial balance and supporting schedules)
to be delivered by Seller pursuant to Section 3(b) will be true and correct in
all material respects, fairly present the assets, liabilities and shareholders'
equity of the Bank and be prepared in accordance with GAAP, except that no
representation is made with respect to variations from GAAP (A) that may result
from compliance with any provisions of this Agreement, including, but not
limited to, Section 6(n), and (B) with respect to the amount of goodwill
included therein. Notwithstanding the foregoing, interim financial statements
are subject to normal recurring year-end adjustments the effect of which,
individually or in the aggregate, will not be materially adverse.
(i) Bank Premises. The Bank has good and marketable title to the
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premises constituting the Main Office and to all other Retained Assets free and
clear of all liens and encumbrances, except for recorded easements and other
minor defects of title which do not impair the use or value of the Main Office
and liens for taxes not yet due and payable (the "Permitted Encumbrances"). The
premises constituting the Main Office and the continuation of business presently
being conducted thereon do not and will not violate any currently applicable
zoning laws. The Main Office (i) is served (independent of adjacent landowners)
by all utilities and services, including electrical power, gas, water, sewer,
and telephone, reasonably necessary for the normal and intended use of the Main
Office as a bank branch and (ii) has ingress and egress to and from Xxxxxxx and
Xxxxxxx Streets and LaHarpe Boulevard necessary to conduct business currently
being conducted thereon. The premises constituting the Main Office are free
from structural defects (patent and latent). The premises constituting the Main
Office and all items of tangible personal property included within the Retained
Assets and located in the Main Office (A) will be reflected accurately in the
Pre-Closing Balance Sheet and (B) are in good operating condition and
repair(subject to normal wear and tear) and are suitable for the purposes for
which they are presently used.
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(j) Reserved.
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(k) Claims. Except for Seller's rights under the Seller CDs, neither
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HCB nor the Seller will have any claim against the Holding Company or the Bank
on or after the Closing Date.
(l) Employment Contracts. Except as described in Schedule 4(l),
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there exist no agreements relating to the employment of any person by the
Holding Company or the Bank, or any bonus, deferred compensation, insurance,
stock option or other employee benefit arrangements to which the Holding Company
or the Bank is a party or which otherwise obligates the Holding Company or the
Bank.
(m) Benefit Plans. Neither the Holding Company nor the Bank
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maintains, contributes to, is a party to or otherwise has or could have any
obligation under any "employee benefit plan" (as defined by Section 3(3) of the
Employee Retirement Income Security Act of 1974, as amended "ERISA") program,
policy, commitment or other arrangement (whether or not in a written document)
covering any active, former or retired employee, director or consultant of HCB,
the Seller or any of their subsidiaries (including the Holding Company and the
Bank), except for Bank's participation in the plans set forth on Schedule
4(m)(i) (collectively, the "Plans"). The Plans comply with all requirements of
ERISA (to the extent applicable), the Internal Revenue Code of 1986, as amended
(the "Code") and all other applicable Legal Requirements and have been
maintained and administered in all material respects in compliance with ERISA
(to the extent applicable), the Code and all other applicable Legal
Requirements. No Plan is covered by Title IV of ERISA or Section 412 of the
Code. Neither the Holding Company nor the Bank, nor any officer or director of
the Holding Company or the Bank, has incurred any liability or penalty under
Sections 4975 through 4980 of the Code or Title I of ERISA. No suit, action or
other litigation (excluding claims for benefits incurred in the ordinary course
of the Plans' activities) has been brought, or is threatened, against or with
respect to such Plans. All contribu tions, reserves or payments required to be
made or accrued as of the date hereof and as of the Closing Date with respect to
Plans have been or will be made or accrued. The Bank's participation in the
Plans will terminate as of the Closing Date and neither the Holding Company nor
the Bank will incur any liability or other obligations with respect to such
Plans or as a result of such termination of participation. Except as set forth
on Schedule 4(m)(ii), which Schedule may be modified or supplemented by the
Seller on the Pre-Closing Date, there are no former employees of the Bank or the
Holding Company who are eligible for benefits under any medical plan sponsored
by the Bank or the Holding Company under the Consolidated Omnibus Budget
Reconciliation Act of 1986, as amended ("COBRA") or under the provisions of such
plan.
-11-
(n) Agreements, Commitments and Certain Loans. Neither the Holding
-----------------------------------------
Company nor the Bank are bound by (i) any agreement of indemnification or
guaranty running from the Holding Company or the Bank to any person or entity,
(ii) except for those agreements and obligations set forth on Schedule 4(n)
attached hereto, any contract (other than a loan) which is not terminable on not
more than 30 days notice or any agreement under which the Holding Company or
Bank has incurred, assumed or guarantied any indebtedness for borrowed money,
(iii) any commitments for charitable, civic or similar contributions, (iv) any
agreement, contract or other commitments which might reasonably be expected to
have a potential material adverse impact on the business of the Holding Company
or the Bank, (v) any agreement, contract or other instrument which contains
restrictions with respect to the payment of dividends or any other distributions
in respect of the Holding Company Stock or the Bank Stock, (vi) any agreement,
contract or commitment containing any covenant limiting the ability of the
Holding Company or the Bank to compete with any person, (vii) any agreement,
contract or commitment relating to capital expenditures, (viii) except as
described on Schedule 4(n), any agreement, con tract or commitment relating to
any transaction or series of trans actions with any executive officer, director,
principal shareholder or their affiliates or related interests (including loans
which constitute an extension of credit within the meaning of the regulations of
the Federal Reserve Board set forth in Regulation O, Part 215 of Title 12 of the
Code of Federal Regulations).
(o) Litigation. There is no action, suit, proceeding or investigation
----------
pending or, to the knowledge of HCB, the Seller, Holding Company or Bank,
threatened, against the Holding Company or the Bank which (i) might have an
adverse effect on the Holding Company or the Bank, (ii) impair the ability of
the Holding Company or the Bank to conduct business as now conducted, or (iii)
restrain or otherwise impair the sale of the Holding Company Stock by the Seller
to the Buyer or restrain or impair the performance of any other action to be
taken by the Seller, the Holding Company or the Bank under this Agreement.
(p) Tax and Other Returns, Reports and Agreements. All federal, state
---------------------------------------------
and local tax returns and tax reports required to be filed by the Holding
Company or the Bank have been timely filed with all appropriate governmental
agencies in all jurisdictions in which such returns and reports are required to
be filed and all such tax returns were correct and complete in all respects and
both the Bank and the Holding Company have complied with all tax laws in all
material respects. All federal, state and local income, profits, franchise,
sales, use, occupation, property, excise and other taxes (including interest and
penalties) with respect to present and prior periods have been fully paid by or
on behalf of the Holding Company and Bank and neither the Holding Company nor
Bank has any liability for any such taxes; except for income and
-12-
property taxes not yet due and payable which in the case of (i) all income taxes
will be assumed by HCB and Seller in accordance with Section 6(l), and (ii) real
property taxes will be (A) accrued through the Pre-Closing Balance Sheet Date
and thereafter paid by Buyer with respect to the Main Office, and (B) the sole
responsibility and obligation (after giving effect to the payment of any
Proration Amount) of Seller with respect to the Monticello Branch and LPO
Office. Neither the Seller, the Holding Company nor the Bank have any knowledge
that any governmental authority intends to assess any additional income taxes
against Holding Company or Bank for any taxable period. There is no dispute or
claim concerning any income tax liability of the Holding Company or Bank. No
extension of time has been requested or given with respect to any tax returns
heretofore filed by the Holding Company or the Bank and neither of the Holding
Company nor Bank has waived any statute of limitations in respect of any taxes
or agreed to any extension of time with respect to a tax assessment or
deficiency.
Each "Affiliated Group" (as defined by Section 1504 of the Internal Revenue
Code of 1986, as amended) in which the Holding Company or Bank is or was a
member has filed all income tax returns that such Affiliated Group was required
to file for each taxable period during which either of the Holding Company or
the Bank was a member of such group. All income taxes owed by the Affiliated
Group have been paid for each taxable period during which any of the Holding
Company or Bank was a member of such group. Neither the Seller, the Holding
Company nor the Bank have any knowledge that any governmental authority intends
to assess any additional income taxes against any Affiliated Group for any
taxable period during which either of the Holding Company or Bank was a member
of such group. There is no dispute or claim concerning any income tax liability
of an Affiliated Group for any taxable period during which either of the Holding
Company or Bank was a member of such group. No extension of time has been
requested or given with respect to any tax returns heretofore filed by an
Affiliated Group and no Affiliated Group has waived any statute of limitations
in respect of any income taxes or agreed to any extension of time with respect
to any income tax assessment or deficiency for any taxable period during which
either of the Holding Company or Bank was a member of such group. Neither of
the Holding Company nor the Bank has any liability for the taxes of other person
or entity (i) under Treas. Reg. (S) 1.1502-6 (or any similar provision of state
law), (ii) as a transferee or successor, (iii) by agreement or (iv) otherwise.
(q) Legal and Regulatory Compliance. Since September 30, 1992, the
-------------------------------
Holding Company and the Bank have filed with the OTS, the FDIC, Internal Revenue
Service and such other federal, state or local regulatory authorities having
jurisdiction over the operations of the Holding Company and Bank (collectively,
the "Regulatory Authorities") all reports and filings required to be
-13-
filed with such Regulatory Authorities under all Legal Requirements.
Except as set forth in Schedule 4(q) the Holding Company and the Bank are
in compliance with all Legal Requirements, including Legal Requirements of
Regulatory Authorities. Except as described on Schedule 4(q), neither the
Holding Company nor the Bank is subject to any specific limitation on activity,
administrative agreement, order or ruling issued by any one or more of the
Regulatory Authorities. Neither HCB, Seller, Holding Company or Bank has any
knowledge that any Regulatory Authority has threatened or considered (i) any
assessment against the Holding Company Stock or the Bank Stock, (ii) a
termination of deposit insurance or revocation of charter of the Bank, or (iii)
issuing a memorandum of understanding, cease and desist order or other
enforcement action against the Bank or Holding Company. Except as set forth in
Schedule 4(q), neither HCB, the Seller, the Holding Company nor the Bank has
received notice of a violation of any Legal Requirements applicable to: (A) the
Holding Company, (B) the Bank, (C) the conduct of the business of the Holding
Company or the Bank, (D) the ownership of any asset purported to be owned by the
Holding Company or the Bank, or (E) the ownership of the Holding Company Stock
by the Seller or the ownership of the Bank Stock by the Holding Company.
(r) Insurance. The Holding Company and Bank carry such insurance
---------
policies (including property, casualty and liability insurance and fidelity bond
and surety arrangements, collectively the "Insurance Policies") with respect to
their properties and businesses in such amounts (including, without limitation,
such amounts as are sufficient to be fully insured under any coinsurance
provisions contained in such policies) and insuring against such risks as is
customary, usual and prudent for the businesses being conducted by them.
Schedule 4(r) sets forth the following information with respect to each such
Insurance Policy under which the Holding Company or Bank is a party, named
insured or otherwise the beneficiary of coverage: (i) the name, address and
telephone number of the agent, (ii) the name of the insurer, policy holder and
each covered insured, (iii) the policy number and the period of coverage, (iv)
the scope and amount of coverage (including an indication of whether the
coverage is on a claims made, occurrence or other basis) and (v) a description
of any retroactive premium adjustments or loss-sharing arrangements. Except as
disclosed in Schedule 4(r), neither HCB, Seller, the Holding Company nor the
Bank has forfeited or waived any claim under any Insurance Policy and each has
fully complied with the terms and conditions thereof. Schedule 4(r) sets forth
all property damage and personal injury claims asserted under such Insurance
Policies by or against the Holding Company or Bank which are otherwise still
pending. All of such claims have been or are being defended by insurance
carriers without reservation and are or will be covered by the Insurance
-14-
Policies. Neither HCB, Seller, Holding Company or Bank has received a
notification from any insurance carrier denying or disputing any claim made by
it, denying or disputing any coverage for any such claim, denying or disputing
the amount of any claim, or regarding the possible termination, cancellation or
amendment of or premium increases with respect to any of the Insurance Policies.
(s) Environmental Compliance. Both the Holding Company and the Bank
------------------------
are in compliance with all applicable federal, state and local statutes, laws,
ordinances and regulations concerning conservation and protection of the
environment except to the extent that failure to comply would not result in a
material adverse effect on the Bank or the Holding Company. To the knowledge of
HCB, the Seller, Holding Company and Bank, no real or personal property owned or
leased by either the Holding Company or the Bank is now being used or has at any
time in the past ever been used for the storage (whether permanent or
temporary), disposal or handling of any hazardous material, hazardous waste,
hazardous substance, contaminant or pollutant, nor are any such materials,
waste, substance, contaminant or pollutant located in, on, under or at the real
or personal property owned, leased or used by the Holding Company or the Bank.
(t) Certain Transactions. Except as described on Schedule 4(t), no
--------------------
current or former officer, director, employee or shareholder of HCB, Seller, the
Holding Company or the Bank has any interest in the Main Office or the Retained
Assets.
(u) Subsidiaries. The Holding Company has no subsidi aries or direct
------------
or indirect equity interest in any partnership, firm, corporation or other
entity or enterprise other than the Bank. The Bank has no subsidiary or direct
or indirect equity interest in any partnership, firm, corporation or other
entity or enterprise.
(v) Corporate Records. The minute and stock record books of the
-----------------
Holding Company and the Bank are true, complete and correct in all material
respects.
(w) Disclosure. HCB and Seller have disclosed to the Buyer in writing
----------
all matters known to HCB, Seller, the Bank or the Holding Company which might
have a material adverse affect on the ownership or operation of the Holding
Company or the Bank.
5. Representations and Warranties of Buyer
---------------------------------------
Buyer represents and warrants to the Seller that the following matters are
true and correct as of the date hereof and will be true and correct on the
Closing Date.
-15-
(a) Organization. The Buyer is organized as a corporation, validly
------------
existing and in good standing under the laws of the State of Arkansas. The
Buyer is duly authorized, qualified and licensed under all applicable laws and
regulations to conduct business as a bank holding company subject to the
supervision of the Federal Reserve Board ("FRB").
(b) Authorization and Validity of Agreement. Buyer has the full
---------------------------------------
corporate power and authority to execute and deliver this Agreement and (subject
to receipt of all requisite regulatory approvals) to consummate the transactions
contemplated hereby. This Agreement has been duly executed and delivered by the
Buyer and is a valid and binding obligation of the Buyer, enforceable against
the Buyer in accordance with its terms, except that (i) such enforcement may be
subject to applicable insolvency or similar laws, now or hereafter in effect,
affecting creditors' rights generally and (ii) the remedy of specific
performance, injunctive and other forms of equitable relief may be subject to
equitable defenses and to the discretion of the court before which any pro
ceedings therefore may be brought.
(c) Investment. The Buyer is acquiring the Holding Company Stock for
----------
investment and not with a view to or for sale in connection with any
distribution thereof within the meaning of the Securities Act of 1933, as
amended.
6. Covenants of HCB, Seller and Buyer.
----------------------------------
(a) Preservation of the Business. From and after the date of this
----------------------------
Agreement, the Seller shall, to the extent required for the continued operation
of the Holding Company's business and the business of the Bank without
impairment, cause the Holding Company and the Bank to preserve substantially
intact their business organization and, in so doing, shall cause the Holding
Company and the Bank to (i) continue their businesses in the ordinary and usual
course and maintain their properties, (ii) maintain their insurance and bonds in
conformity with past practice, (iii) maintain and keep all Retained Assets in
good operating condition and repair, (iv) keep on a current basis their
financial accounting and policies, (v) exercise their best efforts to keep in
their employment present key employees, clerical workers, tellers, and other
employees located at the Main Office and to preserve for the Buyer their
relationship with customers and others to the end that the going business of the
Holding Company and the Bank will be unimpaired at the Closing Date, and (vi) in
all respects substantially comply with all Legal Requirements.
From and after the date of this Agreement, HCB and Seller shall cause the
Holding Company and the Bank to continue their respective businesses in the
ordinary course and, by way of clarification and not limitation, neither HCB,
nor the Seller shall
-16-
permit the Holding Company or the Bank, except as otherwise permitted by this
Agreement or with the prior written approval of the Buyer, to (i) engage in any
transaction which is not in the ordinary course of business or in accordance
with sound banking practices, (ii) amend the certificate of incorporation or
other organizational documents, or the bylaws of the Holding Company or the
Bank, (iii) declare, set aside or pay any dividend or distribu tion with respect
to the capital stock of the Holding Company or the Bank, except for the payment
of cash dividends allowed by Section 6(e), (iv) effect a split or
reclassification of any capital stock of the Holding Company or the Bank, (v)
issue any capital stock of the Holding Company or the Bank, (vi) sell or grant
any options, rights or warrants to purchase stock or other securities of the
Holding Company or the Bank, (vii) encumber, mortgage, transfer or convey any
of the Retained Assets or acquire any material assets or property, (viii) grant
any bonus or any salary increase to any employee, officer or director of the
Holding Company or the Bank, (ix) enter into any written or oral employment
agreement with any employee, renew or extend any existing written or oral
employment agreement or appoint or elect any new or addi tional officers or
directors of the Holding Company or the Bank, (x) borrow or agree to borrow any
funds or incur any indebtedness other than in the ordinary course of business,
which indebtedness will be assumed by Seller pursuant to the P&A Agreement or
repaid by Seller at Closing; (xi) enter into any real or personal property
lease, (xii) enter into any exclusive listing or other contract for the sale of
Retained Assets, (xiii) purchase or commit to purchase or participate in the
purchase of any item of real or personal property, tangible or intangible, (xiv)
enter into any deposit or loan contracts or obligations (except for acceptance
of FDIC-insured deposit accounts of the type permitted by Section 6(m) and the
consummation of loans in the ordinary course of its business which loans will be
purchased by Seller pursuant to the P&A Agreement) or enter into any material
contract, agreement or other binding relationship which cannot be terminated in
full without recourse with thirty days' notice, (xv) incur any expenses other
than in the ordinary course of business, (xvi) make any charitable, civic or
similar contributions or commitments, (xvii) purchase or acquire any
certificates of deposit issued by other financial institutions or, except as
permitted by Section 6(m), invest any funds in securities which are not being
acquired pursuant to the P&A Agreement, (xviii) waive any rights of substantial
value, or (xix) make any commitments for any of the foregoing.
(b) Access. From and after the date of this Agreement, the Seller
------
shall cause the Holding Company and the Bank to provide to representatives of
the Buyer access to the Bank's facilities and access to, and the ability to make
copies of, the Holding Company's and the Bank's books and records during
reasonable business hours in order to facilitate the transition of ownership
contemplated by this Agreement. Buyer shall also be afforded reasonable access
to
-17-
the Main Office after hours, by appointment, for the purpose of installing
computer cables, data lines and other systems necessary to convert the Bank to
Buyer's operating systems. Buyer agrees that its representatives will not
unreasonably interfere with the activities of the Bank or the Holding Company.
(c) Best Efforts. Subject to the terms and conditions herein
------------
provided, each of the parties hereto agrees to use its best efforts to take, or
cause to be taken, all actions, and to do, or cause to be done, all things
necessary, proper or advisable to consummate and make effective the transactions
contemplated by this Agreement.
(d) Public Announcements. The Seller and the Buyer will consult with
--------------------
each other before issuing any press release or otherwise making any public
statements with respect to the transac tions contemplated by this Agreement.
Each of the Buyer and Seller acknowledges that Buyer and HCB are publicly traded
companies subject to the Securities Exchange Act of 1934, and that Buyer and HCB
may each issue a press release and make a public announcement regarding the
transactions contemplated by this Agreement no earlier than 4:30 p.m. Little
Rock time on the date of the execution hereof.
(e) Dividend. Immediately prior to the Closing on the Closing Date,
--------
Seller shall be entitled to cause the (i) Bank to effect a cash dividend to the
Holding Company of the amount of shareholder's equity reflected on the Pre-
Closing Balance Sheet in excess of $3,100,000 and (ii) Holding Company to effect
a dividend of all tangible assets of the Holding Company (other than the Bank
Stock) to Seller.
(f) Closing Net Worth, Indebtedness and Liabilities. HCB and Seller
-----------------------------------------------
covenant that immediately prior to the Closing on the Closing Date, the Bank
shall have minimum shareholders' equity (after giving effect to the purchase
and assumption of the Seller Assets and Seller Liabilities pursuant to the P&A
Agreement and the dividends contemplated by Section 6(e)), determined in
accordance with GAAP (except with respect to variations from GAAP (A) that may
result from compliance with any provisions of this Agreement, including, but not
limited to, Section 6(n), and (B) with respect to the amount of goodwill
included therein) of $3,100,000 (the "Minimum Equity Amount"), which such
Minimum Equity Amount shall include an amount of goodwill not in excess of the
difference between (A) and (B)(the "Maximum Goodwill Amount"), where (A) is
equal to $1,415,223 (as such amount shall be reduced after June 30, 1997 based
upon monthly amortization (or daily amortization prorated for the partial month
occurring prior to Closing) of goodwill in accordance with GAAP and the Bank's
prior practice)and (B) is equal to $450,000. HCB and Seller further agree and
covenant that as of the Closing Date (i) the Holding Company will
-18-
have no indebtedness or outstanding liabilities, contingent or otherwise and
(ii) the Bank will have no indebtedness or outstanding liabilities, contingent
or otherwise, except for Retained Liabilities reflected on the Pre-Closing
Balance Sheet and except as contemplated by section 2.02(c) of the P&A
Agreement.
(g) Name Change; Cooperation Regarding Applications. Buyer covenants
-----------------------------------------------
and agrees that in connection with the Acquisition Transaction it shall submit
an application to change the name of the Bank following the Closing to a name
other than "Heartland Community Bank, FSB," and that such new name shall not
include the word "Heartland." Seller acknowledges that in connection with the
request for approval of the Acquisition Transaction, Buyer intends to submit an
application to Regulatory Authorities for approval of one or more new branch
locations for the Bank. Each of the parties hereto agree to fully cooperate and
assist one another in the preparation of all applications submitted to
Regulatory Authorities in connection with the Acquisition Transaction, the name
change and the new branch applications. Following the Closing, each of the
parties agree to reasonably cooperate with one another in connection with the
gathering and submission of information that may be required by Regulatory
Authorities with respect to future applications or reports regarding the
Acquisition Transaction or the ownership or operation or the Holding Company or
Bank.
(h) Transition of Customer Accounts and Files. Each of the parties
-----------------------------------------
hereto agree to fully cooperate and assist one another in connection with the
transition and conversion of all customer accounts, files (including data
processing files) and other information which is being retained by Bank or
purchased and assumed by Seller pursuant to the terms hereof and to take no
action designed or intended to have the effect of discouraging or damaging any
continuing customer relationship being retained or assumed by any party
hereunder. In furtherance of this covenant to cooperate, the parties
specifically agree as follows:
(i) The parties agree to arrange and attend a meeting between
their respective electronic data personnel and contractors promptly
following the execution of this Agreement for the purpose of
coordinating the transition and conversion of the electronic data
processing matters contemplated by this Section 6(h).
(ii) Seller agrees that sufficiently in advance of the Closing
Date it will provide all customer data files relating to all deposit
accounts which are included in Retained Liabilities to the Buyer so as
to enable the Buyer to download all customer account information from
such files onto Buyer's computer system. Such data files will be
provided to Buyer in hard-copy form and on
-19-
magnetic tape or diskette. On the Pre-Closing Date, Seller shall
deliver to Buyer (in hard-copy form and on magnetic tape or diskette)
a customer trial balance showing the current balances and accrued
interest in all customer accounts as of midnight on the Pre-Closing
Balance Sheet Date so as to allow Buyer to activate all customer
deposit files on its computer system. Although the Seller agrees to
cooperate with Buyer in effecting the download and conversion of the
foregoing data files to the Buyer's computer system, the Buyer
acknowledges that such conversion and transition to its computer
system is the Buyer's ultimate responsibility.
(iii) As soon as practicable after the Closing, but in no event
later than two (2) business days after the Closing Date, the Seller
agrees to distribute a special statement of account to customers for
all of the Bank's transaction accounts which are included in Retained
Liabilities and to provide a copy of such special statements to the
Buyer. Such statement of account shall reflect account balances as of
midnight on the Pre-Closing Balance Sheet Date and include all
transactions in the accounts since the last statement distributed to
the customers and all other information that is normally contained in
the statements prepared for such accounts. Seller will be entitled to
impose normal fees and service charges on a per-item basis, but Seller
will not impose monthly service charges or other periodic fees or
blanket charges in connection with such special statement.
(iv) Seller agrees to pay in accordance with law and customary
banking practices all properly drawn and presented checks, drafts and
withdrawal orders presented to Seller by mail, over the counter or
through the check clearing system of the banking industry, by
depositors of the accounts assumed by Seller pursuant to the P&A
Agreement, whether drawn on the checks, withdrawal or draft forms
provided by the Bank or Seller, and in all other respects to
discharge, in the usual course of the banking business, the duties and
obligations of the Bank with respect to the balances due and owing to
the Seller Retained Customers (as defined below).
(v) Immediately following the Closing, the Seller will (A) issue
new checks, free of charge, and will furnish instructions to all
customers maintaining deposits at the Monticello Branch ("Seller
Retained Customers") to utilize the new checks and to destroy unused
check, draft and withdrawal order forms in the possession of such
Seller Retained Customers which contain the Bank's ABA transit routing
number (the "Old
-20-
Checks") and (B) notify all Seller Retained Customers that no Old
Check will be honored or paid by Bank after the expiration of a ninety
(90) day period following the Closing Date.
(vi) the Seller and Buyer shall develop a mutually agreeable
methodology whereby on each business day following the Closing (A)
Bank shall make a daily presentment to Seller of all Old Checks drawn
on the Bank as of such date of presentment and (B) Seller shall either
(1) make payment to Bank (in same-day funds) of the amount represented
by each such Old Check or (2) direct bank to return the Old Check on
their behalf without payment. Seller acknowledges that Bank will be
acting solely as Seller's agent for the purpose of processing Old
Checks, and Seller agrees to indemnify and hold harmless the Bank and
Buyer from and against any and all Adverse Consequences (as defined
below) resulting from any action undertaken by Bank in good faith or
at the direction of Seller.
(vii) Seller acknowledges that the obligations and responsibility
of Bank to honor, pay and process Old Checks shall terminate on the
ninetieth (90) day following the Closing Date (the "Processing
Termination Date"). After the Processing Termination Date, all Old
Checks drawn on the Bank shall be returned to the customer without
payment. Seller agrees to indemnify and hold harmless the Bank and
Buyer from and against any and all Adverse Consequences resulting from
the return by Bank of any Old Check after the Processing Termination
Date.
(viii) Seller agrees to pay promptly to Buyer an amount
equivalent to the amount of any checks, drafts, withdrawal orders or
other items provisionally credited to an account of a Seller Retained
Customer as of the Closing Date that are returned to Seller or Buyer
after the Closing Date.
(ix) With respect to any deposit account among the Retained
Liabilities that has a negative balance as of the close of business on
the day immediately preceding the Closing Date due to an overdraft
caused by the Bank's final payment in settlement, on or before the
close of business on the day immediately preceding the Closing Date,
of one or more checks, drafts or other items drawn against such
account or any insufficient, overdraft or similar service charge
deducted by Bank from such account (the "Overdraft Items"), which
negative balance continues to exist at the close of business on the
fifth business
-21-
day after the Closing Date after the exercise by the Bank of any
setoff rights which the Bank is entitled to, the Bank shall be
entitled to reimbursement from the Seller in immediately available
funds for the amount of any such negative balance of which the Bank
gives Seller notice within fifteen (15) business days after the
Closing Date. The Bank shall continue as the Seller's agent, for a
period of sixty (60) days after the Closing Date, or such shorter
period as the Seller may request, to assert setoff rights. The Bank
shall immediately deliver to Seller all Overdraft Items in Bank's
possession (if any) for which it demands reimbursement and Seller
shall be vested with all rights, title and interest in, to and in
connection with such Overdraft Items which the Bank otherwise would
have had and Seller shall be entitled to enforce and collect all
rights, remedies, claims and causes of action against all persons and
entities (other than the Bank) including, without limitation, the
drawer and the depositor which the Seller or Bank shall have or would
have had in connection with the Overdraft Item.
(x) If, after the Closing Date, any depositor who is a Seller
Retained Customer, instead of accepting the obligation of Seller to
pay the Seller Liability relating to such depositor's account and
assumed pursuant to the P&A Agreement, shall demand payment from Bank
for all or any part of any such liability, Bank shall not be liable or
responsible for making any such payment; provided, that if Bank shall
pay the same, Seller agrees to reimburse Bank for any such payments,
and Bank shall not be deemed to have made any representations or
warranties to Seller with respect to any such checks, drafts or
withdrawal orders and any such representations or warranties implied
by law or hereby expressly disclaimed.
(xi) As of the Closing Date, Seller will notify all Automated
Clearing House ("ACH") originators effecting debits or credits to the
accounts of Seller Retained Customers; provided, however, that the
Bank may, at its option, notify all such originators itself (on behalf
of Seller). For a period of 90 days beginning on the Closing Date,
the Bank will honor all ACH items related to accounts of Seller
Retained Customers which are mistakenly routed or presented to Bank.
Bank will make no charge to Seller for honoring such items, and will
transmit via facsimile such ACH data to Seller. Items mistakenly
routed or presented after the 90-day period may be returned to the
presenting party. Seller and Bank shall make arrangements to provide
for the daily settlement with immediately available funds by Seller of
any ACH items honored by Bank, and Seller agrees to
-22-
indemnify and hold harmless the Bank and Buyer from and against any
and all Adverse Consequences resulting from any action undertaken by
Bank in good faith for acting in accordance with this arrangement to
accept ACH items or at the direction of Seller.
The parties acknowledge that each of the foregoing procedures constitute a
general statement of the expectations of the parties regarding the transition of
customer accounts and files. The parties intend that the actual details and
procedures for such transition will be finalized in a manner consistent with the
foregoing expectations by the mutual agreement of Buyer's and Seller's data
processing personnel and representatives prior to Closing.
(i) Employees and Employee Benefit Plans. HCB and Seller shall,
------------------------------------
prior to the Closing, take such action as is necessary to (i) terminate the
employment of any all employees of the Bank located at the Monticello Branch or
LPO Office and to pay all salaries of such employees through such date and (ii)
rehire such persons as employees of HCB or Seller on the same or better terms as
such employees were employed by the Bank. Prior to the Closing, HCB and Seller
shall take such action as is necessary to terminate all participation and
obligations of the Bank and the Holding Company under the Plans. HCB and Seller
agree to jointly and severally indemnify and hold harmless the Bank and Buyer
from and against any and all Adverse Consequences resulting from (A) the failure
of HCB or Seller to comply with any Legal Requirement applicable to the
termination and rehiring of the employees of the Bank or the Holding Company on
or prior to the Closing Date (including, but not limited to compliance with
COBRA) or (B) Bank's or Holding Company's participation in or termination as a
participating employer under the Plans. Further, the Buyer shall use its best
efforts to cause its insurance carrier to waive the applicable waiting period
under Buyer's existing health and medical insurance plans so as to allow all
employees of the Bank as of the Closing Date to participate, effective on the
1st day of the month immediately following the Closing Date, in such plans. If
Buyer is unable to obtain the foregoing waiver from it insurance carrier, it
shall take such action as is necessary to allow all employees of the Bank as of
the Closing Date to participate in Buyer's health and medical insurance plans as
soon as possible under the terms of such plans.
(j) Exclusivity. None of HCB or Seller will (and neither HCB nor
-----------
the Seller will cause or permit the Holding Company or the Bank or any officer,
director, employee or affiliate of HCB, Seller, the Holding Company or the Bank
to) (i) solicit, initiate, or encourage the submission of any proposal or offer
from any person or entity relating to the acquisition of any capital stock or
other voting securities, or any substantial portion of the
-23-
assets of, the Holding Company or the Bank (including any acquisition structured
as merger, consolidation or share exchange) or (ii) participate in any
discussions or negotiations regarding, furnish any information with respect to,
assist or participate in, or facilitate in any other manner any effort or
attempt by any person or entity to do or seek any of the foregoing. HCB and
Seller will notify the Buyer immediately if any person or entity makes any
proposal, offer, inquiry or contact with respect to any of the foregoing.
(k) Certain Notifications. Each party shall promptly notify the other
---------------------
in writing of the occurrence of any event which will or could reasonably be
expected to result in the failure to satisfy any of the conditions specified in
Section 7.
(l) Taxes and Reports. (i) HCB shall prepare and file when due all
-----------------
federal, state and local tax returns of any kind for the Holding Company and the
Bank for the period up to the Closing Date (the "Pre-Closing Tax Period") and
shall promptly pay all taxes relating to such Pre-Closing Tax Period, including
installment payments for taxes, interest, penalties, assessments or other
deficiencies of any kind. At least ten (10) days prior to the filing of any tax
return which includes the Pre-Closing Tax Period of the Holding Company and the
Bank, HCB shall deliver a copy of such return to Buyer for approval of any
portion of such return relating to the Holding Company or Bank, which approval
shall not be unreasonably withheld. It is understood that HCB will include the
income of the Holding Company and the Bank (including any deferred income
triggered as a result of the Acquisition Transaction) for the Pre-Closing Tax
Period on HCB's consolidated federal and state income tax returns and will pay
any federal or state income taxes attributable to such income. HCB and Seller
shall be responsible for assimilating all tax information and other data of
Holding Company and Bank with respect to the Pre-Closing Tax Period as may be
necessary for the preparation of HCB's consolidated tax returns; provided
however, that following the Closing, Buyer agrees to cooperate and provide
Seller with such information as may be reasonably necessary for the preparation
of such returns. The income of the Holding Company and the Bank will be
determined for the periods prior to and after the Pre-Closing Tax Period by
closing the books of the Holding Company and the Bank as of the close of
business on the day immediately preceding the Closing Date. All tax allocation
or tax sharing agreements to which the Holding Company or Bank are parties shall
be terminated as of the Closing Date. In the event of any audit or litigation
relating to any consolidated tax return of HCB which includes all or any portion
of the taxable year of the Holding Company or Bank, HCB will notify Buyer and
provide Buyer with any information on any proposed adjustment of any items
relating to Holding Company or Bank. HCB agrees that, without the consent of
Buyer, it shall not compromise any such items or otherwise take any action
relating to
-24-
such items where such compromise or action could have an adverse impact on
either the Holding Company or Bank for any period subsequent to the Pre-Closing
Tax Period.
(ii) All unpaid personal and real property taxes associated with the
Monticello Branch and the LPO Office shall be the responsibility of the Seller
and Seller agrees to (A) pay all such taxes on behalf of Bank directly to the
appropriate taxing authorities and (B) reimburse Bank and Buyer for any amounts
required to be paid directly by Buyer due to Seller's failure to pay such taxes
on a timely basis.
(iii) From and after the date of this Agreement, each of the Buyer
and Seller agrees to provide each other, upon reasonable prior notice, with such
information and data as is necessary to allow the Buyer, Seller, Holding Company
or the Bank, as applicable, to comply with all tax and other regulatory
reporting, audit or other compliance obligations relating to the customers and
operations of the Bank and the Holding Company. For the purposes of this
section, the term "Applicable Tax Period" shall mean the period beginning on the
first day of the year in which the Closing Date occurs and ending on the Closing
Date. Without limiting the generality of the foregoing Seller and Buyer
specifically agrees that:
(A) If the Closing Date occurs after December 31, 1997, the Seller shall be
responsible for the preparation and filing of the following tax reporting
forms for all payroll, account or other activity occurring in 1997:
Internal Revenue Service ("IRS") Forms W-2 and other miscellaneous federal,
state and local tax reporting forms (the "Payroll Forms") and IRS Forms
1099, 1098 and all other miscellaneous federal state and local tax
reporting forms relating to all loan, deposit, trust and other accounts
("Account Forms"). Concurrently with the filing of such forms, the Seller
shall provide copies to Buyer of all such forms, and HCB and the Seller
agree to indemnify the Buyer from and against any Adverse Consequences
incurred by the Bank or Buyer as a result of the Seller's preparation or
filing of such forms.
(B) Prior to the Closing Date, Seller shall provide Buyer with payroll and
other information regarding all persons employed by the Bank at any time
during the Applicable Tax Period, in a form reasonably acceptable to Buyer,
so as to allow Bank to prepare and file Payroll Forms for such Applicable
Tax Period, which such payroll information shall be true, correct and
complete in all respects.
(C) Prior to the Closing Date, Seller shall provide Buyer with all
information for the Applicable Tax Period (including historical account
data) required to effect the preparation
-25-
and filing of Account Forms for such Applicable Tax Period relating to all
loan, deposit, trust and other accounts which either (1) constitute Seller
Assets and Seller Liabilities or (2) which were closed prior to the date of
the Closing.
(D) On the Pre-Closing Date, Seller shall provide Buyer with all
information for the Applicable Tax Period (including historical account
data) required to effect the preparation and filing of Account Forms for
the Applicable Tax Period relating to all deposit accounts which are
included in the Retained Liabilities.
(E) Notwithstanding any other provision herein, the Buyer shall file all
IRS Forms 5498 and any similar state or local tax reporting forms
attributable to the Bank's individual retirement accounts for each of 1997
and 1998, even if the Closing Date occurs after December 31, 1997. On the
Pre-Closing Date, Seller shall provide Buyer with all information for the
period prior to the Closing Date for such tax years of 1997 and 1998
(including historical account data) required to effect the preparation and
filing of the IRS Forms 5498 and any similar state or local tax reporting
forms.
(F) The information and data to be provided by Seller to Buyer pursuant to
paragraphs (B)-(E) immediately above shall be in hard-copy form and on
magnetic tape or diskette (which such magnetic tape or diskette shall be in
a form acceptable for filing with the IRS) and shall be true, correct and
complete in all respects. If such information is in a form that cannot be
processed by the Buyer's computer systems, then the Seller shall cooperate
with the Buyer to prepare and effect any and all filings required by the
IRS or any state or local taxing authorities on the Bank's behalf.
(iv) Subject to the provisions of this Section 6(l)(iv), the Buyer agrees
to promptly pay the Seller an amount equal to the income tax benefit (net of any
increase in federal income tax expense or reduction in federal income tax
benefits resulting from the lower state tax deduction) derived by the Buyer with
respect to any Deferred Tax Assets that the Buyer utilizes on its future income
tax returns. The Buyer agrees that it shall have an affirmative obligation to
utilize the Deferred Tax Assets on its future income tax returns if, but only
if, (i) the Seller causes its certified public accounting firm to provide to the
Buyer (at the Seller's expense) a written opinion that sets forth the manner and
circumstances in which the Buyer may utilize the Deferred Tax Assets and (ii)
the Buyer's own certified public accountants are in agreement with Seller's
accountants that such Deferred Tax Assets may be so utilized by Buyer. Every
year until the Deferred Tax Assets are completely utilized or otherwise expire
under applicable law, Buyer shall, within 30 days of the filing of its state
income
-26-
tax return, cause its certified public accountants to provide (at Buyer's
expense) a letter to Seller outlining the amount, if any, of the Deferred Tax
Asset so utilized and the dollar value benefit being derived by Buyer with
respect to such use. HCB and the Seller agree to indemnify the Buyer from and
against any Adverse Consequences arising from the Buyer's utilization of the
Deferred Tax Assets in accordance with the opinion of the Seller's accountant's,
including any payments or penalties incurred by the Buyer resulting from any
disallowance of the Buyer's utilization of the Deferred Tax Assets by the IRS or
the Arkansas State Department of Finance.
(m) Deposit Products; Investment of Funds and Loans. From and after the
-----------------------------------------------
date of this Agreement, Seller shall not offer any deposit products (including
certificates of deposit) to existing or new customers associated solely with the
Bank's Main Office unless the terms and rates of such products have been
approved in advance by Buyer in its reasonable discretion.
(n) Insurance. On the Closing Date, the Buyer agrees that the Seller may
---------
terminate any insurance policies listed on Schedule 4(r) for which coverage is
occurrence (but not claims) based, and the parties agree that all other
insurance policies listed on Schedule 4(r) shall remain in full force and
effect. If the Bank receives any refund of pre-paid premiums with respect to
any insurance policies due to their early termination in accordance with this
Section 6(n), the Buyer agrees to cause the Bank to promptly remit the amount of
such refund payments to the Seller.
7. Closing Conditions
------------------
(a) Conditions to Obligations of Parties. The obliga tions of the
------------------------------------
Buyer and the Seller to cause the Acquisition Transaction to be consummated
shall be subject to the satisfaction on or prior to the Closing Date of each of
the following conditions:
(i) Approvals of Third Parties. All orders, consents and approvals
--------------------------
necessary in order for the Acquisition Transaction to be lawfully accomplished
shall have been entered by each regulatory authority having jurisdiction over
the transactions contemplated by this Agreement; the form and substance of all
such orders, consents and approvals shall be satisfactory to the parties hereto;
and all applicable statutory waiting periods shall have expired.
(ii) Litigation. There shall not be pending or threatened any
----------
litigation in any court or any proceeding before or by any governmental
department, agency or instrumentality in which it is sought to restrain or
prohibit or obtain damages in respect of the consummation of the Acquisition
Transaction.
-27-
(b) Conditions to Obligations of Buyer. The obligations of Buyer
----------------------------------
hereunder shall be subject to the satisfaction on or prior to the Closing Date
of each of the following conditions, unless Buyer shall have waived such
conditions in writing.
(i) Performance. HCB, Seller, the Holding Company and the Bank
-----------
shall have performed all obligations and complied with all covenants required by
this Agreement to be performed or complied with by them on or prior to the
Closing Date.
(ii) Representations and Warranties. The representations and
------------------------------
warranties of HCB and the Seller contained herein shall be true and correct in
all material respects at the Closing Date with the same force and effect as
though made at and as of such time.
(iii) Purchase and Assumption. The Purchase and Assumption of the
-----------------------
Seller Assets and Seller Liabilities shall have occurred.
(iv) Pre-Closing Balance Sheet. The Pre-Closing Balance Sheet
-------------------------
shall show shareholders' equity for the Bank in an amount equal to the Minimum
Equity Amount, which such Minimum Equity Amount shall include an amount of
goodwill not in excess of the Maximum Goodwill Amount.
(v) Legal Opinion. The Buyer shall have received an opinion dated
-------------
as of the Closing Date from counsel and in form and substance satisfactory to
the Buyer to the effect that (A) HCB, Seller, the Holding Company and the Bank
are corporations duly organized, validly existing and in good standing under the
laws of the jurisdiction under which each is organized and have corporate power
to own or lease their properties and to carry on their business as now being
conducted, (B) the authorized capital stock of the Holding Company consists of
1,000 shares of common stock, par value $20.00 per share, all of which are
issued and outstanding and have been duly and validly authorized and issued and
are fully paid and nonassessable, (C) the authorized capital stock of the Bank
consists of 150,000 shares of common stock, par value $7.50 per share, 33,400 of
which are issued and outstanding and have been duly and validly authorized and
issued and are fully paid and nonassessable, and 100,000 shares of preferred
stock, par value $1.00 per share, no shares of which are issued and outstanding,
and (D) this Agreement is a valid and binding obligation of HCB and Seller,
enforceable against HCB and Seller in accordance with its terms, except as (1)
such enforcement may be subject to applicable bankruptcy, insolvency or other
laws, now or hereafter in effect, affecting creditors' rights generally and (2)
the remedy of specific performance, injunctive and other forms of equitable
relief may be subject to equitable defenses and to the discretion of the court
before which any proceedings therefor may be brought.
-28-
(vi) Title Policy and Survey. Seller shall have delivered to Buyer
-----------------------
(at Seller's expense) a title insurance commitment from a sound and reputable
title insurance company in a form satisfactory to Buyer in its reasonable
discretion, insuring title to the premises constituting the Main Office and any
appurtenant easements as of the Closing Date subject only to exceptions for
Permitted Encumbrances. Seller shall have also delivered to Buyer (at Seller's
expense) a current survey for premises constituting the Main Office and any
appurtenant easements (A) certified to the Buyer and prepared by a licensed
surveyor, (B) conforming to the current ALTA Minimum Standard Detail
Requirements for Land Title Surveys, (C) disclosing the location of all
improvements, easements, sidewalks, roadways, utility lines and other matters
shown customarily on such surveys, and (D) showing ingress and egress to public
streets (the "Survey"). The Survey shall be in a form satisfactory to Buyer and
shall not disclose any survey defect or encroachment from or onto the real
property which has not been cured or insured over prior to the Closing or which
might materially impair Buyer's operation of the property as a bank branch.
(vii) Environmental Survey. Sellers shall have delivered to Buyer
--------------------
(at Buyer's expense) a Phase I Environmental Survey of the premises constituting
the Main Office, which such survey shall disclose no violations of applicable
federal, state and local statutes, laws, ordinances and regulations concerning
conservation and protection of the environment or the presence of any of any
hazardous material, hazardous waste, hazardous substance, contaminant or
pollutant located in, on, under or at such Main Office.
(viii) Termination of Regulatory Restrictions. The Seller shall
--------------------------------------
have provided to Buyer satisfactory evidence that all restrictions, covenants or
representations relating to the Bank's ability to make loans or otherwise
operate its business set forth in any order of, memorandum of understanding or
agreement with, or correspondence to or from the OTS will be lifted or waived
immediately following the consummation of the Acquisition Transaction.
(ix) Termination of Contractual Obligations. The Seller shall have
--------------------------------------
provided to Buyer satisfactory evidence that Seller has obtained the termination
or release of all contractual obligations of Holding Company or Bank under the
agreements referenced in paragraphs 1-8, 11, 12, and 14-19 of Schedule 4(n);
provided, however, if Seller is unable to obtain, after using its reasonable
best efforts, a release or termination of all contractual obligations of the
Holding Company or Bank under the Agreement referenced in paragraph 19 of
Schedule 4(n) (the "Servicing Contract"), then the Seller shall have provided to
Buyer in lieu thereof satisfactory evidence that Seller has obtained the
-29-
consents of all third parties required in order for the Bank or the Holding
Company to transfer and assign the Servicing Contract to the Seller pursuant to
an assignment and assumption to be delivered under the Purchase and Assumption
Agreement in which the Seller agrees to specifically indemnify and hold harmless
the Buyer, Bank and Holding Company (in addition to, and without limitation of,
any indemnification rights otherwise provided by this Agreement) from any
Adverse Consequences arising or resulting from the Seller's failure to perform
its obligations under the Servicing Agreement.
(x) Resignation. Seller shall have delivered to the Buyer the
-----------
resignations of all members of the Boards of Directors, officers and employees
of the Holding Company and Bank other than those whom the Buyer shall have
specified in writing at least three (3) business days prior to the Closing.
(xi) No Material Adverse Change. There shall not have occurred any
--------------------------
material adverse change in the business, properties, operations, assets,
condition (financial or otherwise) or prospects of the Bank.
(xii) Certificates of Good Standing and Transcript. The Seller
--------------------------------------------
shall have delivered to the Buyer a certificate of good standing or existence,
as applicable, for the Holding Company and Bank reflecting that the Holding
Company and Bank are in good standing, have filed all required franchise tax
returns and have paid all required franchise taxes under the laws of the
respective jurisdictions in which they were organized. Seller shall also have
delivered to the Buyer (A) Secretaries' Certificates for each of HCB, Seller and
Bank, in a form and substance satisfactory to Buyer, certifying as to matters of
incumbency and corporate authority for the Acquisition Transaction and attaching
with respect to each of HCB, Seller, and the Bank, a true and correct copy of
its articles of incorporation and bylaws and (B) a transcript containing a true
and correct copy of the Holding Company's articles of incorporation, together
with all amendments thereto, certified by the Arkansas Secretary of State.
(xiii) Closing Certificate. HCB and Seller shall have executed and
-------------------
delivered to Buyer a certificate, in form and substance satisfactory to Buyer,
dated as of the Closing Date, certifying in such detail as the Buyer may
reasonably request to the fulfillment of the foregoing conditions.
(xiv) Tax Affidavit. Each of the Bank and Seller shall have
-------------
executed and delivered to Buyer an affidavit certifying that it is not a
"foreign person" as defined in the federal Foreign Investment and Real Property
Tax Act of 1980.
(xv) Form 5500R. The Bank shall have caused to be filed the Form
----------
5500R for the Heritage Bank, FSB, 401(K) Plan with
-30-
all applicable governmental agencies, including the IRS and the United States
Department of Labor.
(c) Conditions to Obligations of HCB and Seller. The obligations of
-------------------------------------------
HCB and Seller hereunder shall be subject to the satisfaction on or prior to the
Closing Date of each of the following conditions, unless the Seller shall have
waived such condition in writing:
(i) Performance. The Buyer shall have performed all obligations
-----------
and complied with all covenants required under this Agreement to be performed or
complied with by it on or prior to the Closing Date.
(ii) Representations and Warranties of the Buyer. The
-------------------------------------------
representations and warranties of the Buyer contained herein shall be true and
correct in all material respects at the Closing Date with the same force and
effect as those made at and as of such time.
(iii) Closing Certificate. Buyer shall have delivered to the
-------------------
Seller a certificate, in form and substance satis factory to the Seller, dated
as of the Closing Date, certifying in such detail as the Seller may reasonably
request, the fulfillment of the foregoing conditions.
(iv) Legal Opinion. The Seller shall have received from Buyer's
-------------
counsel an opinion dated as of the Closing Date from counsel and in form and
substance satisfactory to Seller to the effect that (A) the Buyer is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Arkansas and has the corporate power to own or lease its
properties and to carry on its business as now being conducted, (B) this
Agreement is a valid and binding obligation of Buyer, enforceable against Buyer
in accordance with its terms, except as (1) such enforcement may be subject to
applicable bankruptcy, insolvency or other laws, now or hereafter in effect,
affecting creditors' rights generally and (2) the remedy of specific
performance, injunctive and other forms of equitable relief may be subject to
equitable defenses and to the discretion of the court before which any
proceedings therefor may be brought.
(v) Certificate of Good Standing. The Buyer shall have delivered
----------------------------
to Seller a certificate of good standing for the Buyer reflecting that it is in
good standing, has filed all required franchise tax returns and has paid all
required franchise taxes under the laws of the jurisdiction in which it is
organized.
8. Survival and Indemnification.
----------------------------
-31-
(a) Survival of Representations, Warranties and Covenants. All of
-----------------------------------------------------
the representations, warranties and covenants of the parties to this Agreement
shall survive the Closing and continue in full force and effect for a period of
24 months thereafter, provided that:
(i) the representations and warranties set forth in Sections 4(a)-(f) and
5(a)-(b) and the matters described in Section 6(f) shall survive the
Closing and continue in full force and effect forever thereafter; and
(ii) the representations and warranties set forth in Sections 4(m) and (p),
the matters described in Sections 6(i) and (l) and the indemnification
provisions set forth in Section 8(b)(ii) shall survive the Closing and
continue in full force and effect until one year after the expiration of
the applicable statute of limitations period during which any person or
entity could bring an action, suit, or proceeding, whether civil, criminal,
administrative, or investigative, relating to the subject matter of such
representations, warranties or provisions.
(b) Indemnification.
---------------
(i) General. HCB and Seller agree to jointly and severally
-------
indemnify and hold harmless Holding Company, Bank and Buyer, and Buyer agrees to
indemnify and hold harmless Seller, from and against any and all claims,
demands, charges, losses, damages, liabilities, fines, assessments, penalties
and obligations (including, without limitation, reasonable attorneys' and
accountants' fees and other costs and expenses of the indemnified party incurred
as an incident thereto) (collectively "Adverse Consequences") in excess of
$10,000, determined in the aggregate and not separately as to each claim (the
"Deductible") arising out of, based on, or relating to any facts or
circumstances that would constitute a breach by the other of this Agreement of
any representation, warranty or covenant contained herein or in the P&A
Agreement; provided however, that the Deductible set forth in this Section 8(b)
shall not act as a limitation on any rights or claims that Buyer may have for
indemnification arising out of a breach of HCB's and Seller's covenants and
obligations under Section 6(f), 6(h) and 6(l)(iii).
(ii) Specific. HCB and Seller agree to jointly and severally
--------
indemnify and hold harmless Holding Company, Bank and Buyer from and against any
and all Adverse Consequences resulting from the Holding Company's or Bank's
violation of, or noncompliance with, any Legal Requirements including, but not
limited to, all violations or matters of noncompliance specifically listed on
Schedule 4(m)(ii) or 4(q).
-32-
(iii) Ceiling. Notwithstanding any other provision contained herein,
-------
there will be a aggregate ceiling equal to the Stock Purchase Price on the
obligation of each party arising under this Section 8(b) to indemnify the other
parties from and against any Adverse Consequences.
9. Termination, Waiver, Extension and Amendment
--------------------------------------------
(a) Termination. This Agreement may be terminated and abandoned at any
-----------
time prior to or on the Closing Date:
(i) by the mutual consent in writing of the Seller and the
Buyer;
(ii) by either the Seller or the Buyer in writing if any of the
conditions to the obligations of such parties contained in Section
7(a) hereof have not been satisfied or, if unsatisfied, waived (if
legally permissible) as of the Closing Date;
(iii) by the Buyer in writing if any of the conditions to the
obligations of the Buyer contained in Section 7(b) hereof shall not
have been satisfied or, if unsatisfied, waived as of the Closing Date;
(iv) by the Seller in writing if any of the condi tions to the
obligations of the Seller contained in Section 7(c) hereof shall not
have been satisfied or, if unsatisfied, waived as of the Closing Date;
or
(v) by either the Buyer or the Seller in writing if the Closing
Date shall not have occurred on or before March 31, 1998.
(b) Willful Breach or Intentional Misrepresentation. In the event the
-----------------------------------------------
transactions contemplated by this Agreement are not consummated due to the
failure of any condition precedent to the consummation of the transactions
resulting from a willful breach of a covenant, an intentional misrepresentation
or a willful failure to comply with the terms of this Agreement by one party,
then the other party, upon termination of this Agreement, shall be entitled to
all appropriate legal and equitable remedies.
(c) No Willful Breach or Intentional Misrepresentation. In the event
--------------------------------------------------
of the termination and abandonment of this Agreement pursuant to the provisions
of Section 9(a) and such termination or abandonment did not result from the
actions described in Section 9(b), this Agreement shall be of no further force
or effect and no party hereto shall have any liability or further obligation to
the other party to this Agreement, except as set forth in that certain
-33-
Letter of Intent among HCB and Buyer, dated September 15, 1997 (the "Letter of
Intent").
(d) Waiver, Extension and Amendment. Any of the terms or conditions
-------------------------------
of this Agreement may be waived, or the time for performance of any obligations
or acts extended, at any time, by the party which is entitled to the benefits
thereof. This Agreement may be modified or amended only by the mutual consent
of the parties hereto. Any waiver, extension, modification or amendment shall
be in writing.
10. Miscellaneous
-------------
(a) Broker's or Finder's Fees. All negotiations rela tive to the
-------------------------
transactions hereby have been carried on by the Buyer and the Seller directly
and without the intervention of any other person in such manner as to give rise
to any valid claim against any of the parties hereto for a finder's fee,
brokerage commission or other similar payment except for that certain fee for
consulting services payable upon Closing to DD&F Consulting Group, Inc., which
fee shall be the exclusive responsibility of, and shall be paid by, the Seller.
(b) Confidentiality. Any non-public information concerning the
---------------
Holding Company or the Bank shall be considered "Confidential Information"
within the meaning of this Agreement. Each of HCB and the Seller will treat
and hold as such all of the Confidential Information, refrain from using any of
the Confidential Information except in connection with this Agreement, and
deliver promptly to the Buyer or destroy, at the request and option of the
Buyer, all tangible embodiments (and all copies) of the Confidential Information
which are in its possession; provided, however, HCB and Seller may retain copies
of such information and data as is necessary to allow them to comply with all
tax and other regulatory reporting, audit or other compliance obligations
relating to the customers and operations of the Bank and the Holding Company.
In the event that any of HCB or the Sellers is requested or required (by oral
question or request for information or documents in any legal proceeding,
interrogatory, subpoena, civil investigative demand, or similar process) to
disclose any Confidential Information, the Seller will notify the Buyer promptly
of the request or requirement so that the Buyer may seek an appropriate
protective order or waive compliance with the provisions of this Section 10(b).
If, in the absence of a protective order or the receipt of a waiver hereunder,
either HCB or Seller is, on the advice of counsel, compelled to disclose any
Confidential Information to any tribunal or else stand liable for contempt, HCB
or Seller may disclose the Confidential Information to the tribunal; provided,
however, that each of HCB and Seller shall use its best efforts to obtain, at
the request of the Buyer
-34-
and at Buyer's expense, an order or other assurance that confidential treatment
will be accorded to such portion of the Confidential Information required to be
disclosed as the Buyer shall designate.
(c) Expenses. Whether or not the transactions contem plated hereby
--------
are consummated, each party shall pay its own expenses and costs incident to
this Agreement and the transactions contemplated hereby, including but not
limited to all expenses incurred by such parties in connection with obtaining
required approvals for the Acquisition Transaction from Regulatory Authorities.
In this regard, the parties agree that all costs and expenses associated with
obtaining regulatory approval of the purchase and assumption of the Seller
Assets and Seller Liabilities shall be borne by Seller and all costs and
expenses associated with obtaining regulatory approval for the acquisition of
the Holding Company Stock shall be borne by the Buyer.
(d) Notices. Any notice or consummation required or permitted to be
-------
made hereunder shall be in writing, and shall be deemed to have been made if
delivered personally or by facsimile, receipt confirmed, or if mailed, by
registered or certified mail, return receipt requested, to the parties at the
addresses shown below. The date of personal delivery shall be the date of
giving notice, or if mailed in the manner prescribed above, notice shall be
deemed to have been given three business days after the mailing.
To the Seller: Heartland Community Bank, Camden, Arkansas
000 Xxxxxxx Xxxxxx, X.X.
X.X. Xxx 000
Xxxxxx, XX 00000-0000
Attention: Xxxxxxx XxXxxx
Facsimile: 000-000-0000
With a copy to: McAfee & Xxxx
00xx Xxxxx, Xxx Xxxxxxxxxx Xxxxxx
000 X. Xxxxxxxx
Xxxxxxxx Xxxx, Xxxxxxxx 00000
Attn: C. Xxxxx Xxxx, Esq.
Facsimile: (000) 000-0000
To the Buyer: Bank of the Ozarks, Inc.
000 Xxxx Xxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxx Xxxx, Xxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxx, XX
Facsimile: (000) 000-0000
With a copy to: Rose Law Firm,
a Professional Association
000 Xxxx Xxxxxx Xxxxxx
-00-
Xxxxxx Xxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxxx
Facsimile: (000) 000-0000
(e) Entire Agreement. This Agreement sets forth the entire
----------------
understanding of the parties hereto and supersedes all prior agreements and
understandings, whether oral or written, except as set forth in the Section 5 of
the Letter of Intent. This Agreement shall not be modified or amended except by
written agreement of all parties hereto.
(f) Binding Effect. This Agreement shall be binding upon and inure to
--------------
the benefit of each of the parties hereto, their respective successors and
assigns.
(g) Further Assurances. Each of the parties hereto agrees to execute
------------------
and deliver such further agreements, assurances, instruments and documents at
any time reasonably requested by another party as is necessary or desirable to
consummate the trans actions contemplated by this Agreement.
(h) Knowledge and Investigation. For the purposes hereof, the term
---------------------------
"knowledge" shall mean information or matters of which HCB, Seller, Holding
Company, Bank and each of their directors, officers, employees or authorized
agents and representatives has actual knowledge or reasonably should have known
after due investigation. No due diligence investigation made by Buyer, its
directors, officers, employees, authorized agents and representatives (including
attorneys and accountants) shall affect the representations and warranties of
HCB and Seller made herein, and each such representation and warranty shall
survive the investigation.
(i) Construction. This Agreement shall be construed and interpreted
------------
in accordance with the laws of the State of Arkansas applicable to contracts
made and performed entirely therein.
(j) Counterparts. This Agreement may be executed in any number of
------------
counterparts, which, taken together, shall constitute one and the same
instrument.
(k) Section Headings. The section headings contained in this
----------------
Agreement are for convenience and reference only and shall not in any way affect
the meaning or interpretation of this Agreement.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
-36-
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed as
of the day and year first above written.
SELLER:
HEARTLAND COMMUNITY BANK,
Camden, Arkansas
By_______________________________
_____________, President
HCB:
HCB BANCSHARES, INC.
By_______________________________
_____________, President
BUYER:
BANK OF THE OZARKS, INC.
By_______________________________
Xxxxxx X. Xxxxxxx, XX,
Chief Executive Officer
-37-
Exhibit "A"
to
Stock Purchase Agreement
Purchase and Assumption Agreement
---------------------------------
PURCHASE AND ASSUMPTION AGREEMENT
---------------------------------
This PURCHASE AND ASSUMPTION AGREEMENT (this "Agreement") is made and
executed as of the ____ day of November, 1997, by and between HEARTLAND
COMMUNITY BANK, FSB ("Little Rock"), a federal savings bank with its main office
located in Little Rock, Arkansas and HEARTLAND COMMUNITY BANK ("Camden"), a
federal savings bank with its main office located in Camden, Arkansas.
Capitalized terms not otherwise defined in this Agreement shall have the same
meaning as set forth in that certain Stock Purchase Agreement, of even date
herewith, by and between Bank of the Ozarks, Inc., the Camden and HCB
Bancshares, Inc. (the "Stock Purchase Agreement").
W I T N E S S E T H:
WHEREAS, pursuant to the terms and as a condition to the closing of
the transactions contemplated by the Stock Purchase Agreement, Little Rock
desires to sell and Camden desires to acquire all of the assets of Little Rock
other than the Retained Assets and, in connection therewith, Camden desires to
assume from Little Rock all liabilities, obligations or commitments (contingent
or otherwise) of Little Rock other than the Retained Liabilities.
NOW, THEREFORE, in consideration of the premises and the mutual terms
and provisions set forth in this Agreement and in the Stock Purchase Agreement,
the parties agree as follows:
ARTICLE ONE
-----------
PURCHASE AND SALE OF ASSETS AND ASSUMPTION OF LIABILITIES
---------------------------------------------------------
Section 1.01. Purchase of Assets. Upon the terms and subject to the
------------ ------------------
provisions of this Agreement and the Stock Purchase Agreement, Little Rock shall
sell, convey, assign and transfer to Camden, and Camden shall purchase and
accept from Little Rock, all right, title and interest of Little Rock in and to
all assets of Little Rock, other than the Retained Assets (the " Seller
Assets"). Little Rock and Camden agree and acknowledge that the Seller Assets
are sold, conveyed, assigned and transferred to Camden on an "as is" basis
without any recourse, representation or warranty (including, but not limited to,
representations or warranties as to quality, condition, title or compliance with
laws, rules or regulations of Regulatory Authorities).
Section 1.02. Assumption of Liabilities. Upon the terms and subject
------------ -------------------------
to provisions of this Agreement and the Stock Purchase Agreement, Little Rock
shall transfer and assign to Camden, and Camden shall assume from Little Rock
and agree to pay, perform and discharge as of the Effective Time (as hereinafter
defined), all of the liabilities, obligations or commitments (contingent or
otherwise) of Little Rock other than the Retained Liabilities (the
"Seller Liabilities") existing as of the Effective Time, including, without
limitation, all deposit liabilities maintained at the Monticello Branch and all
Excluded Deposits maintained at the Main Office (the "Deposits" or "Deposit
Liabilities"), as shown on the books and records of Little Rock as of the
Effective Time, including accrued but unpaid interest thereon to the Effective
Time, except as provided in Section 2.02(c) hereof.
ARTICLE TWO
-----------
CLOSING, PAYMENT OF PURCHASE PRICE AND CLOSING DELIVERIES
---------------------------------------------------------
Section 2.01. The Closing; Effective Time. The closing of the
------------ ---------------------------
purchase and assumption transactions contemplated by this Agreement (the
"Closing") shall take place immediately prior to the closing of the stock
purchase and sale transaction (the "Stock Acquisition") contemplated by the
Stock Purchase Agreement at the time and place agreed for the closing of the
Stock Acquisition, and shall be effective (the "Effective Time") immediately
prior to the start of business on the date of the Closing (the "Closing Date").
Section 2.02. Retirement Accounts.
------------ -------------------
(a) At the Closing, Little Rock shall resign as custodian with respect
to any individual retirement account ("XXX Account") as to which Little Rock is
custodian and as to which one or more of the assets included therein is a
deposit included within the Deposits transferred to Camden on the Closing Date.
At the Closing, Little Rock shall designate or appoint Camden as successor
custodian under each such XXX Account.
(b) Camden covenants and agrees that it will, following its
designation or appointment as successor custodian under the XXX Accounts,
promptly and faithfully perform, fulfill, and discharge each of the obligations
required to be performed by the custodian with respect to such accounts pursuant
to law, or pursuant to the governing documents establishing such XXX Account.
(c) If an individual depositor with respect to an XXX Account refuses
to accept the designation or appointment of Camden as successor custodian with
respect to any such XXX Account, Camden agrees on demand to provide to Little
Rock sufficient funds to pay the deposit liability represented by such XXX
Account as reflected on the books of Camden at the time the claim is made. Upon
payment by Camden to Little Rock of such amount, Camden shall be discharged from
any further obligation under this Agreement to pay any such depositor the amount
of such deposit liability paid to Little Rock and such Deposits contained in the
XXX account shall not be assumed by Camden but shall remain the liability and
obligation of Little Rock.
A-2
Section 2.03. Payment of Purchase Price.
------------ -------------------------
(a) On the Effective Date, Little Rock and Camden shall settle the
Asset Purchase Price in accordance with the provisions of Sections 2(b) and
3(c)(i) of the Stock Purchase Agreement.
(b) If necessary, on the Adjustment Delivery Date, an adjustment
payment (the "Adjustment Payment") shall be made either by Little Rock to Camden
or by Camden to Little Rock, as appropriate, so as to correct any discrepancy
regarding the amount of the Asset Purchase Price described in Section 3(e)(ii)
of the Stock Purchase Agreement plus interest as described therein. The
Adjustment Payment due to either party pursuant to this paragraph shall be paid
to such party on the Adjustment Payment Date by the other party by wire transfer
in immediately available funds to an account designated by the payee party.
(c) In the event of a Dispute, promptly upon the resolution of the
Dispute regarding the amount of the Asset Purchase Price in accordance with
Section 3(e)(iii) of the Stock Purchase Agreement, the payment, as specified
therein, shall be made either by Little Rock to Camden or by Camden to Little
Rock, as appropriate, which payment shall be made by wire transfer in
immediately available funds to an account designated by the payee party.
Section 2.04. Closing Deliveries.
------------ ------------------
(a) At the Closing, Little Rock shall deliver to Camden:
(i) a certified copy of the resolutions of Little Rock's Board
of Directors, as required for valid approval of the execution of this Agreement
and the consummation of the purchase and assumption transactions contemplated
hereby;
(ii) an Assignment and Assumption of Seller Liabilities
Agreement in substantially the form of Exhibit 1 hereto;
(iii) an Assignment and Assumption of Contracts Agreement in
substantially the form of Exhibit 2 hereto;
(iv) a Xxxx of Sale in substantially the form of Exhibit 3
hereto;
(v) a quit claim deed conveying all of Little Rock's real
property to the Camden, other than that certain real property included in the
Retained Assets as described in Section 1(c)(i) of the Stock Purchase Agreement
(the "Real Property");
A-3
(vi) an Assignment and Successor Trustee Agreement with respect to
the transfer of the XXX Accounts in substantially the form set forth in Exhibit
4;
(vii) listings of the Deposit Liabilities as of the start of business
on the Closing Date (the "Deposit Listings") on magnetic tape or utilizing such
other method of information transfer as the parties may mutually agree, which
Deposit Listings shall include account number, outstanding principal balance,
and accrued interest;
(viii) Little Rock's files and records related to all loans (the
"Loans") comprising the Seller Assets as of the start of business on the
Effective Date, including, without limitation, all deposit related overdrafts
and/or overdrafts pursuant to an overdraft protection plan which are associated
with Deposit Liabilities, the notes or other instruments evidencing such Loans
which shall be duly endorsed on their face or by separate assignment by Little
Rock to the Camden without recourse;
(ix) teller working cash, xxxxx cash and vault cash at the Monticello
Branch as of the start of business on the Closing Date;
(x) such records and files specifically relating to the Seller Assets
and Seller Liabilities, excluding, without limitation, those matters specified
in Section 2(e) of the Stock Purchase Agreement;
(xi) Little Rock's keys to the safe deposit boxes and Little Rock's
records related to the safe deposit box business at the Monticello Branch;
(xii) such of the other Seller Assets as shall be capable of physical
delivery to the Camden; and
(xiii) affidavit of Little Rock certifying that Little Rock is not a
"foreign person" as defined in the federal Foreign Investment and Real Property
Tax Act of 1980.
(b) At the Closing, Camden shall deliver to Little Rock:
(i) a certified copy of the resolutions of the Board of Directors of
Camden authorizing the execution of this Agreement and the consummation of the
purchase and assumption transactions contemplated hereby;
(ii) an Assignment and Assumption of Seller Liabilities Agreement in
substantially the form set forth in Exhibit 1 hereto;
A-4
(iii) an Assignment and Assumption of Contracts Agreement in
substantially the form set forth in Exhibit 2 hereto; and
(iv) an Assignment and Successor Trustee Agreement with respect to
the transfer of the XXX Accounts in substantially the form set forth in Exhibit
4 hereto.
ARTICLE THREE
-------------
CONDITIONS PRECEDENT TO THE PURCHASE AND ASSUMPTION
---------------------------------------------------
Section 3.01. Conditions to Little Rock's Obligations. Little Rock's
------------ ---------------------------------------
obligations to effect the purchase and assumption transactions contemplated by
this Agreement shall be subject to the satisfaction (or waiver by Little Rock)
prior to or on the Closing Date of the following conditions:
(a) Camden shall have performed and complied in all material respects
with all of its obligations and agreements hereunder required to be performed
prior to the Closing Date under this Agreement.
(b) All conditions to the closing of the Stock Acquisition as
specified by the Stock Purchase Agreement shall have been satisfied (or, if
legally permissible, waived) other than the condition related to the closing of
the transactions contemplated by this Agreement.
Section 3.02. Conditions to Camden's Obligations. Camden's
------------ ----------------------------------
obligations to effect the purchase and assumption transactions contemplated by
this Agreement shall be subject to the satisfaction (or waiver by Camden) prior
to or on the Closing Date of the following conditions:
(a) Little Rock shall have performed and complied in all material
respects with all of its obligations and agreements required to be performed
prior to the Closing Date under this Agreement.
(b) All conditions to the closing of the Stock Acquisition as
specified by the Stock Purchase Agreement shall have been satisfied (or, if
legally permissible, waived) other than the condition related to the closing of
the transactions contemplated by this Agreement.
A-5
ARTICLE FOUR
------------
TERMINATION OR ABANDONMENT
--------------------------
Section 4.01. Mutual Agreement. This Agreement may be terminated by
------------- ----------------
the mutual written agreement of the parties in conjunction with or at any time
following the termination of the Stock Purchase Agreement in accordance with
Section 9(a) thereof.
Section 4.02. Automatic Termination. If the Closing Date does not
------------ ---------------------
occur on or prior to the date specified by Section 9(a)(v) in the Stock Purchase
Agreement (including any extensions thereof), then this Agreement shall
thereupon be terminated without any further action by the parties hereto.
ARTICLE FIVE
------------
GENERAL
-------
Section 5.01. Notices. Any notice or other communication shall be in
------------ -------
writing and shall be deemed to have been given or made on the date of delivery,
in the case of hand delivery, or three (3) business days after deposit in the
United States Registered Mail, postage prepaid, or upon receipt if transmitted
by facsimile telecopy or any other means, addressed (in any case) as follows:
(a) if to Little Rock:
Heartland Community Bank, FSB
P. O. Box 8052
000 X. Xxxxxxx
Xxxxxx Xxxx, XX 00000-0000
Attn: President
Facsimile: (000) 000-0000
and
(b) if to Camden:
Heartland Community Bank
P. O. Box 878
000 Xxxxxxx Xxxxxx, XX
Xxxxxx, XX 00000-0000
Attn: Xx. Xxxxxxx XxXxxx
Facsimile: (000) 000-0000
or to such other address as any party may from time to time designate
by notice to the other.
A-6
In the event of any notice or other communication by either party is
given pursuant to this Section 5.01, a copy of such notice or communication
shall be provided to:
McAfee & Xxxx
Tenth Floor, Two Leadership Square
000 Xxxxx Xxxxxxxx
Xxxxxxxx Xxxx, XX 00000
Attn: C. Xxxxx Xxxx
Facsimile: (000) 000-0000
and
Rose Law Firm
a Professional Association
000 Xxxx 0xx Xxxxxx
Xxxxxx Xxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxxxx
Facsimile: (000) 000-0000
Section 5.02. Entire Agreement. This Agreement and the Stock
------------ ----------------
Purchase Agreement constitutes the entire agreement between the parties and
supersedes and cancels any and all prior discussions, negotiations,
undertakings, agreements in principle and other agreements between the parties
relating to the subject matter hereof. In the event of a conflict between any
of the terms and provisions hereof and the Stock Purchase Agreement, the Stock
Purchase Agreement shall be deemed to control except as contemplated by Section
2.02(c) hereof.
Section 5.03. Headings and Captions. The captions of Articles and
------------- ---------------------
Sections hereof are for convenience only and shall not control or affect the
meaning or construction of any of the provisions of this Agreement.
Section 5.04. Amendment or Modification. This Agreement may not be
------------- -------------------------
amended or modified except by a written document duly executed by the parties
hereto and Bank of the Ozarks, Inc.
Section 5.05. Further Assurances. Each of the parties hereto agrees
------------- ------------------
to execute and deliver such further agreements, assurances, instruments and
documents at any time reasonably requested by the other party as is necessary or
desirable to carry out the purposes of this Agreement.
Section 5.06. Rules of Construction. Unless the context otherwise
------------- ---------------------
requires: (a) a term has the meaning assigned to it; (b) "or" is not exclusive;
and (c) words in the singular may include the plural and in the plural include
the singular.
A-7
Section 5.07. Counterparts. This Agreement may be executed in two or
------------- ------------
more counterparts, each of which shall be deemed an original and all of which
shall be deemed one and the same instrument.
Section 5.08. Successors and Assigns. This Agreement shall be
------------ ----------------------
binding upon and inure to the benefit of the parties hereto and their respective
successors and permitted assigns.
Section 5.09. Governing Law; Assignment. This Agreement shall be
------------- -------------------------
governed by the laws of the State of Arkansas and applicable federal laws and
regulations. Neither this Agreement, nor any of the rights, interests or
obligations hereunder, shall be assigned by either of the parties hereto without
the prior written consent of the other.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed as of the date first above written.
LITTLE ROCK HEARTLAND COMMUNITY BANK, FSB
Little Rock, Arkansas
By:_________________________________
Title:______________________________
Attest:
By:_______________________
Title:____________________
CAMDEN HEARTLAND COMMUNITY BANK
Camden, Arkansas
By:_________________________________
Title:______________________________
Attest:
By:_______________________
Title:____________________
X-0
Xxxxxxx "X"
to
Stock Purchase Agreement
Furniture and Fixtures
----------------------
(Intentionally Omitted)
Exhibit "C"
to
Stock Purchase Agreement
Denominations and Maturities of Seller CDs
-------------------------------------------
Amount of Seller CD Maturity Date
------------------- -------------
$516,000 91 days following the
Closing Date
$516,000 182 days following the
Closing Date
$516,000 273 days following the
Closing Date
$516,000 First anniversary of
the Closing Date
$516,000 First anniversary of
the Closing Date,
plus 91 days
$520,000 First anniversary of
the Closing Date,
plus 182 days
