EXHIBIT 2
BRANCH PURCHASE AND ASSUMPTION AGREEMENT
This BRANCH PURCHASE AND ASSUMPTION AGREEMENT (the "Agreement") is
made and entered into, effective as of the 17th day of October, 2001, by and
between Shelby County Bank, a federal savings banking association having its
principal office in Shelbyville, Indiana (the "Seller"), and Community First
Bank & Trust, an Ohio state bank having its principal office in Celina, Ohio
(the "Purchaser").
WITNESSETH:
WHEREAS, the Seller owns and operates banking Branches (as hereinafter
defined); and
WHEREAS, the Seller desires to sell certain assets and assign certain
deposit and other liabilities and obligations attributed to the Branches to the
Purchaser, and the Purchaser desires to purchase such assets and assume such
liabilities and obligations, upon the terms and conditions hereinafter set
forth.
NOW, THEREFORE, in consideration of the foregoing premises, the
representations, warranties and mutual agreements and covenants contained
herein, and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto agree as follows:
ARTICLE I
PURCHASE OF ASSETS; ASSUMPTION OF LIABILITIES; PAYMENT
1.1 Identification of Branches. The Seller leases and maintains two
branch offices located at 0000 Xxxx Xxxxxxxxx Xxxxxxxxx, Xxxxx Xxxxxx, Xxxx
Xxxxx, Xxxxxxx and 0000 Xxxxx Xxx Xxxxxx Xxxx, Xxxx Xxxxx, Xxxxx Xxxxxx, Xxxxxxx
(the "Branches"). The Branches are the only branch offices of the Seller which
are the subject of this Agreement. The Seller is a party to that certain Lease
with Option to Purchase (the "Xxxxxx Lease") dated February 2, 2000, between
National Oil & Gas, Inc. and Xxxxxx Real Estate Company, Inc. (collectively, the
"Landlord") and the Seller pursuant to which the Landlord will build a bank
branch located in the 8000 block of West Jefferson Boulevard, Xxxxx County, Fort
Xxxxx, Indiana, and the Seller will lease such bank branch pursuant to the terms
of the lease. Purchaser on the date hereof has entered into an agreement with
the Xxxxxx Xxxxx LLP pursuant to which the Purchaser will acquire the real
estate located in the 8000 block of West Jefferson Boulevard ("Xxxxxx Real
Estate"). On the date hereof, the Landlord and Seller have entered into an
agreement to terminate the Xxxxxx Lease on the date of the purchase of the
Xxxxxx Real Estate by Purchaser.
1.2 Time and Place of Closing. The closing of the transactions
contemplated hereby (the "Closing") shall occur at such time and on such date as
may be mutually agreed to by the parties (the "Closing Date"); provided that
both parties shall use their reasonable efforts to close such
transactions on or before December 31, 2001. The Closing shall be held at the
offices of Xxxxx XxXxxxx LLP in Indianapolis or at such other location as may be
mutually agreed to by the parties.
1.3 Purchase of Assets. The Seller agrees, subject to Section 1.4
hereof and the other terms and conditions of this Agreement, to sell, transfer,
convey, assign and deliver to the Purchaser, and the Purchaser agrees to
purchase, accept and receive from the Seller, on the Closing Date the following
assets, properties and rights free and clear of all security interests, liens,
mortgages and encumbrances, except such security interests, liens, mortgages and
encumbrances that are in favor of the Seller with respect to and securing the
Loans or that arise under applicable law (the "Assets"):
(a) all right, title and interest of Seller in and to all
loans together with all security interests,
mortgages, guaranties and collateral related thereto
then attributed to the Branches at their respective
outstanding principal amounts, together with all
accrued but unpaid interest thereon and fees, as of
the close of business on the business day immediately
preceding the Closing Date, as listed on Exhibit
1.3(a) hereto, with such exhibit to be updated as of
the close of business on the business day immediately
preceding the Closing Date (the "Loans"), provided,
however, that the Loans shall not include any loans
described in Section 1.4(b) hereof;
(b) all overdrafts associated with all deposit
liabilities assumed by the Purchaser under Section
1.5(a)hereof;
(c) all rights of Seller as lessee under the leases (the
"Branch Leases") pertaining to or associated with the
Branches together with all leasehold improvements
associated therewith , the legal descriptions of
which are set forth on Exhibit 1.3(c) hereto (the
"Leased Property"); and
(d) all right, title and interest of Seller in and to all
personal property, furniture, fixtures, equipment and
ATM machines located at the Branches and owned by the
Seller, as listed on Exhibit 1.3(e) hereto (the
"Fixed Assets"), together with any manufacturer's
warranties and maintenance or service agreements
thereon which are in effect on the Closing Date and
are assignable to the Purchaser;
(e) all rights of Seller as lessee under the leases (the
"Equipment Leases", the equipment subject thereto
shall be referred to as the "Leased Equipment")
pertaining to or associated with certain equipment
used at the Branches, the description of which are
set forth on Exhibit 1.3(f) hereto;
(f) all petty, teller, ATM and vault cash maintained at
the Branches as of the close of business on the
Closing Date, the exact amounts of which will be
certified by the Seller as of the Closing Date;
2
(g) all rights of Seller to the extent assignable in, to
and under any vendor single interest insurance or
other insurance on collateral transferred to the
Purchaser with the Loans;
(h) subject to Section 1.7 hereof, all safe deposit
contracts and leases for the safe deposit boxes
located at the Branches; and
(i) customer lists associated with the Loans and Deposit
Liabilities, safe deposit boxes and SCB CDs (as
defined below) and certain intangible assets
associated with the Branches, consisting of the
favorable financing value of the deposit accounts
attributable to and booked at the Branches as of the
Closing Date, the intangible value of the list of
customer loan relationships attributable to the
Branches as of the Closing Date, the value of the
list of established safe deposit box customers at the
Branches as of the Closing Date, and the value of the
specific group of employees of the Branches,
presently performing the operations of the Branches
on behalf of Seller as of the Closing Date; and
(j) the telephone and facsimile numbers associated with
the Branches.
1.4 Excluded Assets. All assets, properties and rights of the Seller
not expressly included in the Assets are excluded from the transactions
contemplated by this Agreement, including, without limitation, the following
items (the "Excluded Assets"):
(a) all trademarks, tradenames, copyrights, medallion
program stamps, signs, logos, proprietary
information, stationery, forms, labels, shipping
materials, brochures, advertising and marketing
materials and similar property owned by, relating to
or referencing First Community Bank of Fort Xxxxx
(except for the limited use under the license granted
in Section 2.21 hereof), the Seller or any of its
affiliates;
(b) the following loans attributed to the Branches as of
the close of business on the business day immediately
preceding the Closing Date shall not be sold pursuant
to this Agreement:
(i) all loans attributed to the Branches with
respect to which on the close of business on
the business day immediately preceding the
Closing Date (A) the collateral securing the
loan has been repossessed, (B) the security
interest in the collateral securing the loan
has not been perfected or is incomplete, or
(C) collection efforts have been instituted
or
3
delivery or foreclosure proceedings have
been filed;
(ii) all loans attributed to the Branches as of
the close of business on the business day
immediately preceding the Closing Date which
are recorded as non-accrual or which have
principal or interest that is ninety (90)
days or more past due;
(iii) all loans attributed to the Branches as of
the close of business on the business day
immediately preceding the Closing Date in
connection with which the borrower has filed
a petition for relief under the United
States Bankruptcy Code or has filed against
it any proceeding in bankruptcy,
reorganization, debt, adjustment or
receivership, or any assignment by the
Seller for the benefit of creditors, prior
to the Closing Date; and
(iv) the Construction Note from Xxxxxx
Enterprises, Inc. and Xxxxx Xxxxxx, Loan
#2000130-1 in the principal amount of
$2,164,400.29 and the Note from Xxxxx X.
Xxxxxx, Loan # 2000131-1 in the principal
amount of $380,887.69 (collectively, the
"Xxxxxx Credit"); provided, however, that
Purchaser shall provide administrative
services with respect to the Xxxxxx Credit
as may be reasonably requested by Seller;
(c) all assets, properties and rights of the Seller and
any of its affiliates used, relating to, located at
or attributed to any operations, branches or
facilities of the Seller or any of its affiliates
other than the Branches or the Assets; and
(d) all routing numbers of the Seller used in connection
with the Deposit Liabilities or the Branches.
1.5 Assumption of Liabilities. The Purchaser agrees, subject to Section
1.6 hereof and the other terms and conditions of this Agreement, that on and
after the Closing Date it shall assume and fully and timely perform, discharge
and pay, in accordance with their respective terms, all of the liabilities and
obligations of the Seller relating to:
(a) the deposit accounts attributed to the Branches as of
the close of business on the business day immediately
preceding the Closing Date (including, without
limitation, all checking, savings, money market,
certificate of deposit (other than the certificates
of deposit excluded pursuant to
4
Section 1.6(c) hereof and sweep accounts) together
with all accrued interest relating to such accounts,
as listed on Exhibit 1.5(a) hereto, with such exhibit
to be updated as of the close of business on the
business day immediately preceding the Closing Date
(the "Deposit Liabilities");
(b) the Loans except those described in Section 1.6(c)
hereof;
(c) the Branch Leases;
(d) the Equipment Lease;
(e) all safe deposit boxes and all leases and contracts
for the safe deposit boxes located at the Branches as
of the Closing Date as described in Section 1.7
hereof;
(f) the operation of the Branches in the ordinary course
of business, including, without limitation, the
obligations to the Employees (as hereinafter defined)
as set forth in Section 2.7 hereof; and
(g) any liability or obligation which is expressly
identified elsewhere in this Agreement as being
assumed, performed, discharged or paid by the
Purchaser including, without limitation, Sections
1.8, 1.9, 1.13, 2.6, 2.8, 2.12, 2.13, and 2.15.
The liabilities and obligations described in this Section 1.5 that are
assumed by the Purchaser are referred to collectively in this Agreement as the
"Assumed Liabilities".
1.6 Excluded Liabilities. All liabilities and obligations of the Seller
not expressly included in the Assumed Liabilities are excluded from the
transactions contemplated in this Agreement, including, without limitation, the
following items (the "Excluded Liabilities"):
(a) all liabilities associated with cashier's checks or
other official bank checks and traveler's checks
issued by the Seller prior to the Closing Date;
(b) all liabilities and obligations of the Seller
relating to the Branches that are not expressly
included in the Assumed Liabilities; and
(c) the certificate of deposits attributed to the
Branches which will not be assumed by Purchaser (the
"SCB CDs") as determined pursuant to and listed on
Exhibit 1.6(c) hereto);
(d) the Xxxxxx Lease; and
5
(e) except as provided in Section 2.7(b) with respect to
vacation and sick time, all liabilities and
obligations of any type relating to employment
contracts, collective bargaining agreements, or
employment-related litigation, or with respect to
employee benefit plans, arrangements, practices,
contracts, or agreements whether formal or informal,
written or unwritten, covering present or former
employees or dependents, or applicable to one or more
than one person, including but not limited to
employee welfare benefit plans and employee pension
benefit plans as defined in Sections 3(1) and 3(2) of
the Employee Retirement Income Security Act,
nonqualified deferred compensation plans, medical
plans, disability plans, life insurance plans,
severance pay plans, educational assistance plans,
cafeteria plans, flexible spending accounts, stock
option plans, and stock purchase plans.
1.7 Safe Deposit Business.
(a) On and after the Closing Date, the Purchaser shall
assume and thereafter fully and timely perform and
discharge all of the Seller's obligations with
respect to the Seller's safe deposit box business at
the Branches in accordance with the terms and
conditions of the contracts or rental agreements
related to such safe deposit boxes.
(b) On and after the Closing Date, the Seller shall
transfer the records related to such safe deposit box
business to the Purchaser, and the Purchaser shall
maintain and safeguard all such records and be
responsible for granting proper access to and
protecting the contents of the safe deposit boxes at
the Branches.
(c) All safe deposit box rental payments and late payment
fees collected by the Seller before the Closing Date
for the respective current lease terms shall be
prorated between the parties as of the Closing Date.
1.8 Bills of Sale; Assignments; Documentation of Assumption. On the
Closing Date, the Seller shall deliver to the Purchaser such bills of sale,
assignments and instruments of transfer, satisfactory in form and substance to
counsel for the Seller and counsel for the Purchaser, under which the Seller
will transfer its right, title and interest in and to the Assets to the
Purchaser. On the Closing Date, the Purchaser shall deliver to the Seller such
undertakings, satisfactory in form and substance to counsel for the Seller and
counsel for the Purchaser, under which the
6
Purchaser shall assume and agree to fully and timely perform, discharge and pay,
in accordance with their terms, all of the Assumed Liabilities.
1.9 Assumption Subject to Certain Terms. The liabilities and
obligations being assumed by the Purchaser pursuant to this Agreement shall be
assumed subject to the terms and conditions of the lease, deposit and other
written agreements relating thereto and all applicable laws, statutes, rules and
regulations.
1.10 Payment. The Seller shall transfer the Assets to the Purchaser and
Purchaser shall pay the Seller by wire transfer of immediately available funds
on the Closing Date an amount determined in accordance with Exhibit 1.10 hereto;
and such payment formula shall be further adjusted in accordance with Section
1.11 hereof and, after the Closing Date, in accordance with Section 1.14 hereof.
The payment formula referred to above is for the sole purpose of determining the
amount of cash transferable at the Closing Date and shall not constitute an
allocation of the purchase price to any particular asset being transferred or
liability being assumed pursuant hereto.
1.11 Pro-Rated Adjustment of Income and Expenses. All utility payments,
real and personal property taxes and similar expenses and charges relating to
the Leased Property and the Fixed Assets, all Federal Deposit Insurance
Corporation ("FDIC") premiums and assessments and all other expenses relating to
the Deposit Liabilities assumed and the operation of the Branches shall be
prorated between the parties as of the Closing Date on the basis of a 365-day
year. To the extent any such item has been prepaid by the Seller for a period
extending beyond the Closing Date, there shall be a proportionate monetary
adjustment in favor of the Seller. Any unearned noninterest income associated
with the Branches, except as specifically provided in this Agreement, shall also
be adjusted pro rata between the parties as of the Closing Date. All expenses
relating to the Branches which arises on and after the Closing Date shall be
paid by the Purchaser.
1.12 Allocation of Purchase Price. The purchase price for the assets
being purchased and the liabilities being assumed by the Purchaser pursuant to
this Agreement shall be allocated on an allocation schedule to be agreed upon by
the Purchaser and the Seller within thirty (30) days after the Closing Date.
This allocation is intended to comply with the allocation method required by
Section 1060 of the Internal Revenue Code of 1986, as amended. The Purchaser and
the Seller shall cooperate to comply with all substantive and procedural
requirements of Section 1060 and any regulations thereunder, and the allocation
shall be adjusted if and to the extent necessary to comply with the requirements
of Section 1060.
1.13 Transfer Taxes. The Purchaser shall pay all transfer and
conveyance taxes in connection with the transfer of the Assets to the
7
Purchaser and all recording fees in connection with the transfer of the Leased
Property to the Purchaser.
1.14 Adjustments. It is understood that the books and records of the
Seller may not be complete as of the Closing Date and that certain assets and
liabilities of the type constituting the Assets and Assumed Liabilities may not
have been included therein because (a) such Assets and Assumed Liabilities (i)
were not posted on the Closing Date, or (ii) are carried in the Seller's
suspense account, or (b) for other reasons, complete information with respect to
the Assets and Assumed Liabilities was not otherwise available. Within thirty
(30) days after the Closing Date, the Seller and the Purchaser shall prepare a
revised closing statement setting forth the payment required pursuant to
Sections 1.10 and 1.11 of this Agreement taking into account, among other
things, assets and liabilities of the type constituting the Assets and Assumed
Liabilities and transactions occurring through the close of business on the
business day immediately preceding the Closing Date; provided, however, that
Purchaser will review all loans originated after the date of this Agreement and
prior to the Closing Date (the "Interim Loans"), and Purchaser will have the
right to reject any Interim Loan and to exclude it from the revised closing
statements if such Interim Loan's origination is not consistent with the
underwriting criteria used by Seller prior to the date of this Agreement. If
Seller and Purchaser fail to reach agreement on the revised closing statement
within such 30-day period, Seller and Purchaser shall submit their disputes to
an independent nationally recognized public accounting firm (the "Auditor") for
resolution; provided, that if Seller and Purchaser are unable to agree upon an
Auditor, the Auditor shall be a "Big Five" public accounting firm (or any of
their respective successors) selected by lot (after Seller and Purchaser each
exclude one such accounting firm). The parties shall each be entitled to make a
presentation to the Auditor, pursuant to the procedures to be agreed to among
their parties and the Auditor, advocating the merits of the position espoused by
such party; and the Auditor shall be required to resolve the dispute between the
parties and determine the revised closing statement within 15 business days
thereafter. All determinations pursuant to this paragraph shall be in writing
and delivered to the parties. The determination of the Auditor as to the
resolution of any dispute regarding the revised closing statement (the "Auditor
Determination") shall be conclusive, final, binding and non-appealable by the
parties, absent fraud or manifest error. Within five days after the Auditor
Determination, the Purchaser shall pay to the Seller or the Seller shall pay to
the Purchaser, as appropriate, the difference between the amount paid on the
Closing Date and the amount required to be paid pursuant to the revised closing
statement. Each of the Seller and Purchaser shall pay 50% of the fees and
expenses of the Auditor.
8
ARTICLE II
CERTAIN AGREEMENTS OF PURCHASER AND SELLER
2.1 Regulatory Approvals.
(a) The Purchaser shall, as soon as practicable following
the date of this Agreement, but in no event later
than ten (10) days, prepare and file all
applications, as required by applicable law, with the
appropriate federal and state regulatory authorities
for approval to purchase the Assets and assume the
Assumed Liabilities, to establish a branch at the
location of each of the Branches and to effect in all
other respects the transactions contemplated hereby
(the "Governmental Approvals"). The Purchaser agrees
to (i) make draft copies of the applications (except
for any confidential portions thereof) available to
the Seller and its counsel at least two (2) days
prior to the filing thereof, (ii) treat the
applications in a diligent manner and on a priority
basis, (iii) request confidential treatment by the
appropriate federal and state regulatory authorities
of all non-public information submitted in the
applications, (iv) provide the Seller and its counsel
promptly with a copy of the applications as filed
(except for any confidential portions thereof) and
all approvals, denials, notices, orders, opinions,
correspondence and other documents with respect
thereto, and (v) use its reasonable efforts to obtain
all Governmental Approvals. The Purchaser and the
Seller agree to cooperate and use their reasonable
efforts to obtain the consents and approvals of all
third parties and to do all things necessary to
consummate the transactions contemplated by this
Agreement.
(b) The Seller shall, as soon as practicable following
the date of this Agreement, but in no event later
than ten (10) days, prepare and file with the
appropriate federal regulatory authorities notice of
its intent to terminate operation of the Branches and
to consummate the transactions contemplated hereby
and thereafter shall (i) comply with the normal and
usual requirements imposed by such authorities
applicable to effectuate such transactions, and (ii)
use its reasonable efforts to obtain any required
permission or approval of such regulatory authorities
to cease operating the Branches.
2.2 Full Access. The Seller shall afford to the employees and
authorized representatives of the Purchaser, upon forty-eight (48) hours' prior
notice, reasonable access to the properties, books and records directly related
to the Branches in order that the Purchaser may have full opportunity to make a
reasonable
9
investigation of the Assets and the Assumed Liabilities, at Purchaser's sole
expense, at reasonable times during the Seller's regular business hours without
interfering with the normal business and operations of the Branches or the
affairs of the Seller. The Seller shall furnish the Purchaser with such
information as to its business, operations and properties relating to the
Branches as the Purchaser may, from time to time, reasonably request and as
shall be available which is required for inclusion in all governmental
applications necessary to effect the transactions contemplated hereby. Nothing
in this Section 2.2 shall be deemed to require the Seller to breach any
obligation of confidentiality or to reveal any proprietary information, trade
secrets or marketing or strategic plans.
2.3 Confidentiality. The Seller and the Purchaser are parties to a
separate confidentiality agreement relating to the Branches and the transactions
contemplated hereby which shall remain binding upon the parties and in full
force and effect in accordance with its terms (the "Confidentiality Agreement").
2.4 Conversion of Accounts; Transfer and Delivery of Assets and Deposit
Liabilities; SCB CDs.
(a) Subject to the servicing agreement, substantially in
the form attached as Exhibit 2.4(a) hereto which
shall be entered into by the parties on the Closing
Date, the Purchaser shall assure that its data
processing systems are capable of receiving the
Assets and the Deposit Liabilities upon the
expiration or termination of the servicing agreement.
(b) On the Closing Date, the Seller shall:
(i) deliver to the Purchaser such of the Assets as
shall be capable of physical delivery;
(ii) execute, acknowledge and deliver to the
Purchaser all such endorsements, assignments,
bills of sale and other instruments of
conveyance, assignment and transfer as, in the
reasonable judgment of the Purchaser, shall be
necessary and appropriate to consummate the
sale and transfer of the Assets to the
Purchaser and to vest in the Purchaser the
legal and equitable title to the Assets, free
and clear of all liens and encumbrances,
except as otherwise permitted in this
Agreement;
(iii) assign, transfer and deliver to the Purchaser
such of the following records pertaining to
the Deposit Liabilities as exist
10
and are available in whatever form or medium
is maintained by the Seller:
(A) all orders, agreements and contracts
between the Seller and depositors
attributed to the Branches and
records of similar character, with
signature cards delivered at the
Closing; and
(B) all records of account maintained
for each depositor attributed to the
Branches;
(iv) produce a bank statement for each of the
Loans transferred and Deposit Liabilities
assumed and mail, at its expense, a
statement substantially similar to
statements previously provided to the
customers dated as of the business day
immediately prior to the Closing Date to the
customer with respect to each of the Deposit
Liabilities;
(v) assign, transfer and deliver, with all
appropriate endorsements, to the Purchaser
the promissory notes, security agreements,
mortgages and related agreements and loan
files relating to or evidencing all Loans to
the extent the same exist and in whatever
form or medium is maintained by the Seller;
and
(vi) assign, transfer and deliver to Purchaser
all books, records, documents, agreements,
instruments and papers regarding the Assets.
(d) Following the Closing Date, Purchaser may solicit the
holders of the SCB CDs. Purchaser agrees to service
the SCB CDs following the Closing Date and Seller and
Purchaser shall reasonably agree to the manner in
which this servicing shall occur.
2.5 Retention of and Access to Files and Records Following the Closing
Date. The Purchaser agrees that it shall maintain, preserve and safely keep, for
as long as may be required by applicable law and in accordance with customary
business practices, all of the files, books of account and records relating to
the Branches (including, without limitation, the Assets and Assumed Liabilities
transferred pursuant to this Agreement) for the joint benefit of itself and the
Seller, and that it shall permit the Seller or its representatives, at any
reasonable time (without interfering with the normal business and operations of
the Branches) and at the Seller's expense, to inspect, make extracts from or
copies of any such files, books of account and records as the Seller shall deem
reasonably necessary. Nothing in this Section 2.5 shall be deemed to require
Purchaser to breach any
11
obligation of confidentiality or to reveal any proprietary information, trade
secrets or marketing or strategic plans.
2.6 Safekeeping. The Seller agrees to transfer and deliver to the
Purchaser on the Closing Date all safe deposit box contents, including without
limitation, securities, papers, valuables and other items (collectively,
"Safekeeping Items"), held by the Seller in safekeeping for its customers at the
Branches, together with all records relating thereto (in whatever form or medium
is maintained by the Seller). The Purchaser agrees to assume, honor and
discharge, from and after the Closing Date, the duties and obligations of the
Seller with respect to such safe deposit boxes and the Safekeeping Items and
shall be entitled to any right or benefit arising from such safekeeping business
from and after the Closing Date. The Purchaser agrees to execute as of the
Closing Date a receipt for such Safekeeping Items.
2.7 Employees.
(a) The active employees of the Seller who are then
assigned to the Branches as of the Closing Date (the
"Employees") shall, as of the Closing Date, be
terminated by the Seller and Purchaser shall offer
employment to each Employee on an at-will basis. The
Seller shall be solely responsible for payment of all
wages and benefits to each such Employee for all
periods ending prior to or on the Closing Date and
for all required filings of Forms W-2 and other
required filings with federal, state, and local tax
authorities with respect to such periods.
(b) Immediately following the Closing, the Purchaser will
make available to the Employees who accept employment
with Purchaser substantially the same employee
benefits on substantially the same terms and
conditions as the Purchaser then offers to its
similarly situated employees. The Purchaser shall
have the sole discretion to change such terms and
conditions and employee benefits from time to time,
provided that service of each of the Employees with
the Seller prior to the Closing shall be credited for
purposes of (i) eligibility under the Purchaser's
employee welfare benefit plans, and (ii) eligibility
and vesting, but not for purposes of benefit accrual
or contributions, under all other employee benefit
plans of the Purchaser, including, without
limitation, all pension, retirement, profit sharing
and employee stock ownership plans. The Seller shall
be responsible for all salary, compensation and
employee benefits, and all payroll taxes in
connection therewith, for the Employees that is
accrued, owed or arises with respect to all periods
prior to or on the Closing Date. In addition, on and
after the Closing Date,
12
the Purchaser shall assume and honor all accrued but
unused or unpaid vacation and sick leave for the
Employees who accept employment with the Purchaser
for all periods prior to and on the Closing Date, but
only if the Seller provides final certifications of
such accrued leave to the Purchaser within thirty
(30) days after the Closing Date. The amounts of
leave accrued as of the Closing Date for the
Employees who accept employment, as certified by
Seller, shall not be reduced except as used by the
Employees or as it would have been forfeited under
the Seller's leave policies, but the Purchaser shall
not be obligated to continue Seller's leave policies
and may instead provide that all leave credited after
the Closing Date is determined under the Purchaser's
policies.
2.8 Payment of Items After the Closing Date. Following the Closing
Date:
(a) The Purchaser agrees to pay in accordance with
applicable law and customary banking practices all
properly drawn and presented checks, drafts and
withdrawal orders presented to the Purchaser by mail,
over the counter or through the check clearing system
of the banking industry by depositors related to the
Deposit Liabilities, whether drawn on the checks,
withdrawal or draft forms provided by the Seller or
by the Purchaser, and in all other respects to
discharge, in the usual course of the banking
business, the duties and obligations of the Seller
with respect to the balances due and owing to the
depositors with respect to whom the Purchaser has
assumed the Deposit Liabilities.
(b) If any of such depositors, instead of accepting the
obligation of the Purchaser to pay the Deposit
Liabilities, shall demand payment from the Seller for
all or any part of any such Deposit Liabilities, the
Seller shall not be liable or responsible for making
such payment and may process such demand pursuant to
Section 2.8.
(c) After the Closing, the Seller shall be and have the
rights and obligations of a "Collecting Bank" or
"Intermediary Bank" under Article 4 of the Uniform
Commercial Code as adopted in Indiana Code section
26-1-4 et seq. with respect to items drawn on the
Deposit Liabilities which are received by Seller for
processing. Items received for processing against the
Deposit Liabilities shall be grouped and delivered to
the Purchaser within the time
13
limits provided by the Indiana Uniform Commercial
Code in a special cash letter separately identified
as "Transferred Accounts Cash Letter." For purposes
of paying the Purchaser's obligations to the Seller
under this Section 2.8, the Purchaser will establish
a settlement account with the Seller at the Closing
Date in a collected amount equal to One Hundred
Thousand Dollars ($100,000), which amount shall be
maintained by the Purchaser for a period of ninety
(90) days following the Closing Date, against which
will be (i) debited the checks, returns, ACH charges
and items hereafter referred to in this sentence and
(ii) charged amounts in accordance with Section
2.8(c) hereof to provide, among other things, for the
settlement by the Purchaser of checks, ACH debits,
returns and items which are presented to the Seller
within ninety (90) days after the Closing Date and
which are drawn on or chargeable to Deposit
Liabilities transferred to the Purchaser. In order to
reduce the continuing charges to the Seller through
the check clearing system of the banking system which
will result from check forms of the Seller being
used after the Closing Date by the depositors whose
accounts are assumed pursuant hereto, the Purchaser
agrees, at its cost and expense, and without charge
to such depositors, to notify such depositors as soon
as possible after the Closing Date of the Purchaser's
assumption of the Deposit Liabilities and to furnish
each depositor of an assumed account with checks on
the forms of the Purchaser and with instructions to
utilize the Purchaser's checks and to destroy unused
checks of the Seller. After the expiration of such
90-day period following the Closing Date, the Seller
shall dishonor all checks, drafts, withdrawal orders
and other instruments and items drawn on the Deposit
Liabilities unless the Seller and the Purchaser agree
to extend such 90-day period and extend the provision
for a settlement account as necessary. The Purchaser
agrees to arrange for the transportation directly and
pay the expenses of transporting from the Seller to
the Purchaser all checks, drafts, orders of
withdrawal, cash letters, magnetic tapes and other
items related to the Seller's receipt of items
relating to the Deposit Liabilities after the Closing
Date. These transportation expenses may be charged
against the settlement account of the Purchaser. The
Seller shall terminate all ACH arrangements relating
to the Deposit Liabilities on or prior to the Closing
Date and notify all depositors in writing of such
termination.
14
(d) The Purchaser agrees to pay promptly to the Seller
(i) an amount equal to the amount of any checks,
drafts and withdrawal orders credited by the Seller
before the Closing Date to all transferred accounts
that are returned to the Seller unpaid after the
Closing Date, and (ii) for a period not to exceed
thirty (30) days from the Closing Date, an amount
equal to the amount of any checks, drafts and
withdrawal orders credited by the Seller after the
Closing Date to all transferred accounts that are
returned to the Seller unpaid after the Closing Date.
Upon receipt thereof, the Seller shall immediately
forward any such check, draft, withdrawal order or
other item to the Purchaser, and subject to the time
limitations referenced herein, the Purchaser shall
remit to the Seller the amount of each such check,
draft, withdrawal order and other item.
2.9 Loan Payments and Information Received After the Closing Date.
(a) Following the Closing Date, the Seller agrees:
(i) to forward promptly to the Purchaser all
payments (properly endorsed without recourse
as necessary) which are received by the
Seller on or after the Closing Date that
relate to the Loans and to provide
sufficient information so that any such
payments may be properly applied to the
extent such information is available to the
Seller; and
(ii) to forward promptly to the Purchaser all
notices or other correspondence received on
or after the Closing Date that relate to the
Loans or any of the other Assets.
(b) The Purchaser shall have sixty (60) days following
the Closing to notify the Seller in writing that any
Loan should have been excluded at the Closing from
the Assets under Section 1.4. Upon receiving such
notice, the Seller agrees to promptly repurchase any
such Loan for an amount equal to the amount paid
therefor by the Purchaser.
2.10 Seller Signage and Other Identification. Upon expiration of the
Term (as defined in Section 2.21), the Purchaser, at its expense, shall
substitute its name and logo for the name and logo of the Seller on all signs at
the Branches and shall remove all signs which carry the name and logo of the
Seller. The Seller agrees, at its expense, to remove from the Branches as
promptly as practicable after the Term any such signs so removed by the
Purchaser. Upon expiration of the Term, the Purchaser agrees to
15
replace promptly all written, printed and electronic materials bearing the
Seller's name and/or logo used in the ordinary course of business at the
Branches with written or electronic materials bearing the Purchaser's name
and/or logo, including, without limitation, coupon books for Loans, stationery,
forms and marketing and other materials. All such materials so replaced shall be
removed by the Seller, at its expense, from the Branches as promptly as
practicable after the Term.
2.11 Right to Intervene. Prior to the Closing, in the event that any
claim, demand, suit or other proceeding is instituted or threatened against the
Purchaser relating to this Agreement or the Assets transferred to or the Assumed
Liabilities assumed by the Purchaser hereunder, the Seller shall have the right,
at its discretion and expense, to intervene in such matter, and the Purchaser
hereby agrees to give prompt and prior notice thereof to the Seller and consents
to such intervention.
2.12 Assumption of Risks.
(a) If the Leased Property or buildings or other
improvements of one or more of the Branches are
destroyed or materially damaged by fire or other
casualty prior to the Closing Date and shall not have
insurance coverage which in the reasonable
determination of the Purchaser is sufficient to
repair or replace such Leased Property or buildings
or other improvements, the Purchaser shall have the
right to terminate this Agreement with regard to the
applicable Leased Property or buildings or other
improvements or to accept the applicable Leased
Property, building and improvements as damaged,
together with any rights of the Seller to receive
insurance proceeds and to exercise any other rights
of the Seller under all other Assets following their
assignment to Purchaser on the Closing Date.
(b) On and after the Closing Date, the Seller shall
discontinue all casualty, liability and other
insurance coverage maintained with respect to the
Branches and the Assets. The Purchaser shall be
solely responsible for all casualty losses and
liability claims relating to the Branches arising on
and after the Closing Date.
(c) On and after the Closing Date, the Seller shall
discontinue providing any security for persons and
property at the Branches. The Purchaser shall be
solely responsible for all liabilities arising out of
injury or damage to persons and property on or at the
Branches on and after the Closing Date.
16
(d) On and after the Closing Date, the Purchaser shall
maintain adequate insurance with respect to the
losses described in (b) and (c) above and otherwise
with respect to the operation of the Branches.
2.13 Information Reporting.
(a) Subject to Section 2.13(b) hereof, with respect to
the Loans and the Deposit Liabilities purchased and
assumed by the Purchaser pursuant to this Agreement,
(i) the Purchaser shall be responsible for reporting
to the customer and to the Internal Revenue Service
(and any state or local taxing authority as required)
all interest paid or earned during the entire year in
which the Closing Date occurs, and (ii) the Seller
agrees to provide the Purchaser with information
about the Deposit Liabilities and the Loans through
the close of business on the business day immediately
preceding the Closing Date necessary for the
Purchaser to comply with the requirements of this
Section 2.13, and the Seller shall have no
responsibility to provide such information to any
customer or the Internal Revenue Service or any state
or local taxing authority.
(b) The Purchaser shall use its best efforts to comply
with its obligations under Section 2.13(a)(i) hereof,
but if the Purchaser is unable to so comply, then (i)
the Seller shall be responsible for reporting to the
customer and to the Internal Revenue Service (and any
state or local taxing authority) all interest paid or
earned on the Deposit Liabilities and the Loans prior
to Closing Date, and (ii) the Purchaser shall be
responsible for reporting to the customer and to the
Internal Revenue Service (and any state or local
taxing authority) all interest paid or earned on the
Deposit Liabilities and the Loans on or after the
Closing Date.
2.14 Cooperation and Further Assurances. Each party agrees that on and
before the Closing Date: (a) it shall (i) cooperate with the other in
accomplishing the terms and conditions of this Agreement, and (ii) furnish such
information and take such actions as may be reasonably required for the other to
fulfill any of its obligations hereunder; and (b) at any time and from time to
time after the Closing Date, it shall execute and deliver to the other party
such further instruments or documents as the other party may reasonably require
to give effect to the transactions contemplated hereunder.
2.15 Condition of Assets. The Purchaser has inspected the Fixed Assets,
Leased Equipment, Leased Property and buildings and
17
improvements located on the Leased Property, observed their physical
characteristics and existing conditions and has been afforded the opportunity to
conduct such investigation and study on and of the Fixed Assets, Leased
Equipment, Leased Property and buildings and improvements as it deems necessary
for the purpose of acquiring the Fixed Assets, Leased Equipment, Leased Property
and buildings and improvements for the Purchaser's intended use, and the
Purchaser hereby waives any and all objections to or claims with respect to any
and all physical characteristics and existing conditions of the Fixed Assets,
Leased Equipment, Leased Property and buildings and improvements. The Purchaser
further acknowledges and agrees that the Fixed Assets, Leased Equipment, Leased
Property and buildings and improvements are to be assigned or sold and conveyed
to, and purchased and accepted by, the Purchaser in their present condition "AS
IS."
2.16 Customers. The Purchaser understands and agrees that no assurance
or guarantee is given by the Seller that the loan, deposit or other customers
attributed to the Branches will become or continue to be customers of the
Purchaser, the same being at the sole discretion of such customers.
2.17 Conduct of Business Pending Closing Date. From the date of this
Agreement and until the earlier of the Closing Date or the termination of this
Agreement, the Seller shall:
(a) conduct business at the Branches in the ordinary
course substantially in the manner as conducted on
the date of this Agreement, except for activities or
transactions contemplated by this Agreement;
(b) not take any action or fail to take any action which
will impair the business relationship of the
customers attributed to the Branches with the Seller;
(c) except as set forth in Exhibit 2.17 hereto, not grant
any increase in pay or benefits to any of the
employees of the Branches;
(d) not enter into any employment, severance or similar
agreement with any of the employees of the Branches;
(e) not hire any new employees at the Branch Office or
transfer any employees to the Branches (i) except as
is reasonably necessary in the Seller's business
judgment to operate the Branch Office in accordance
with Sections 2.17(a) and (b) hereof, or (ii)
otherwise with the prior written consent of the
Purchaser;
(f) not offer interest rates or terms on any category of
deposits at the Branches, except as determined in a
manner consistent with the Seller's practices with
18
respect to its branches in Shelby County, Indiana,
that are not being sold; and
(g) Seller shall use reasonable efforts to maintain an
appropriate staff necessary to operate the Branches
until the Closing Date and shall use reasonable
efforts to encourage the existing employees at the
Branches to remain and become employees of Purchaser,
it being understood and agreed that nothing herein
shall prevent Seller from discharging any employee of
any Branch for cause at any time in its sole and
complete discretion.
2.18 Agreement with Respect to Seller Solicitations. From the date of
this Agreement and for a period of one year following the Closing Date, the
Seller shall not specifically target and solicit persons or entities who are
customers attributed to the Branches as of September 30, 2001 or who hold the
SCB CDs (collectively, the "Targeted Customers"); provided, however, that the
Seller shall not be restricted or prohibited from engaging in or using general
mass mailings, telemarketing programs, newspaper, radio, television or print
advertisements, the internet, the Seller's web site, electronic advertisements
or communications and other types of communications that are directed to the
general public or to a group of persons defined by criteria other than status as
a Targeted Customer of a Branch. For six months following the Closing Date, the
Seller will not directly compete for or solicit as officers or employees of
Seller or any of its affiliates who are employees of the Branches, except
employees of the Branches who elect not to become or remain employed by
Purchaser. Seller agrees not to transfer any of the existing employees of the
Branches who are, as of the date hereof, assigned to the Branches, excluding
temporary personnel, without the consent of the Purchaser, which consent shall
not be unreasonably withheld.
2.19 Indemnification.
(a) From and after the Closing Date, the Seller shall
indemnify and hold the Purchaser harmless from and
against any and all Losses (as defined below)
incurred by or asserted against the Purchaser due to
or resulting from: (i) subject to Section 8.17
hereof, the breach of any representation or warranty
of the Seller as referenced by or set forth in the
Agreement; (ii) a violation or default by the Seller
or any of the Seller's covenants, obligations or
agreements hereunder; (iii) any liability for
liabilities or obligations related to the Assets, the
Deposit Liabilities or the other Assumed Liabilities,
which occur, arise or accrue prior to the Closing
Date; (iv) the operation of the Branches prior to the
Closing Date; and (v) any of the Excluded
Liabilities. For the purposes of this Section 2.19,
the term "Purchaser" shall
19
include the Purchaser's present, future and former
officers, directors, employees, agents, successors,
assigns, affiliates and shareholders.
(b) From and after the Closing Date, the Purchaser shall
indemnify and hold the Seller harmless from and
against any and all Losses incurred by or asserted
against the Seller due to or resulting from: (i)
subject to Section 8.17 hereof, the breach of any
representation or warranty of the Purchaser as
referenced by or set forth in this Agreement; (ii) a
violation or default by the Purchaser of any of the
Purchaser's covenants, obligations or agreements
hereunder; and (iii) any liability for liabilities or
obligations related to the Assets, the Deposit
Liabilities or the other Assumed Liabilities, which
occur, arise or accrue on or after the Closing Date.
For the purposes of this Section 2.19, the term
"Seller" shall include the Seller's present, future
and former officers, directors, employees, agents,
successors, assigns, affiliates and shareholders.
(c) To exercise its indemnification rights under this
Section 2.19 as a result of the assertion against it
or any claim or potential liability for which
indemnification is provided, the indemnified party
shall promptly notify in writing the indemnifying
party of the assertion of such claim, discovery of
any such potential liability or the commencement of
any action or proceeding in respect of which
indemnity may be sought hereunder so as not to
jeopardize or adversely affect the indemnifying
party's ability to defend, settle, compromise or
otherwise deal with such claim, liability, action or
proceeding. The indemnified party shall advise the
indemnifying party of all facts relating to such
assertion within the knowledge of the indemnified
party, and shall afford the indemnifying party the
opportunity, at the indemnifying party's sole cost
and expense, to defend against such claims for
liability. In any such action or proceeding, the
indemnified party shall have the right to retain its
own counsel, but the fees and expenses of such
counsel shall be at its own expense unless (i) the
indemnifying party and the indemnified party mutually
agree to the retention of such counsel or (ii) the
named parties to any such suit, action, or proceeding
(including any impleaded parties) include both the
indemnifying party and the indemnified party, and in
the reasonable judgment of the indemnified party,
representation of the indemnifying party and the
indemnified party by the same counsel would be
20
inadvisable due to actual or potential differing
defenses or conflicts of interests between them.
(d) The indemnified party shall have the right to settle
or compromise any claim or liability subject to
indemnification under this Section, and to be
indemnified from and against all Losses resulting
therefrom, unless the indemnifying party, within
sixty (60) calendar days after receiving written
notice of the claim or liability in accordance with
Section 2.19(c) above, notifies the indemnified party
that it intends to defend against such claim or
liability and undertakes such defense, or, if
required in a shorter time than sixty (60) calendar
days, the indemnifying party makes the requisite
response to such claim or liability asserted.
(e) Notwithstanding the foregoing, in no event shall the
Seller indemnify and hold harmless the Purchaser and
any person directly or indirectly controlling the
Purchaser from and against any and all Losses which
the Purchaser may suffer, incur or sustain arising
out of or attributable to, on and after the Closing
Date, (i) any nonpayment of any loans, (ii) any
closure of any of the Deposit Liabilities, or (iii)
any loss of loan or deposit customers; provided that
any of such Losses does not result from a breach of
any representation or warranty of the Seller as
referenced by or set forth in this Agreement.
(f) As used in this Section 2.19, "Losses" mean any and
all losses, damages, awards, liabilities, judgments,
settlements, fines, costs and expenses incurred or
sustained by an indemnified party, including, without
limitation, reasonable attorneys' fees, expenses and
disbursements relating to all Losses and relating to
an indemnified party pursuing its indemnification
rights hereunder against an indemnifying party.
2.20 Public Releases. Except as required by law or deemed advisable to
comply with any law, neither Seller nor Purchaser shall issue any news or press
releases or make any other public announcements or disclosures relating to this
Agreement or the transactions contemplated hereby without the prior consent of
the other. In the event such disclosure is required by law then the disclosing
party shall provide such disclosure to the other party and allow them to comment
on the disclosure.
2.21 Grant of License.
(a) Seller hereby grants to Purchaser a fully-paid up,
royalty free, limited, non-exclusive right and
21
license to use the service xxxx "First Community Bank
of Fort Xxxxx" (and any colorable imitation, similar
short form, or derivation thereof) (the "Xxxx") owned
by Seller, solely in connection with the conduct of
Purchaser's banking operations within Fort Xxxxx,
Indiana, on or in connection with those goods and/or
services on or with which Seller or other rightful
users of the Xxxx have customarily used the Xxxx.
(b) The Xxxx and any business and goodwill associated
therewith are and shall at all times remain the
property of Seller. All use of the Xxxx by Purchaser
and all business and goodwill generated by use of the
Xxxx shall inure to the benefit of Seller.
(c) Seller reserves the right to approve in advance all
public uses of the Xxxx other than uses in connection
with materials prepared by Seller or previously
approved by Seller. During the Term (as defined
below), Purchaser will diligently and strictly comply
with all standards, specifications, and instructions,
if any, provided to Purchaser in writing by Seller
(as the same may be amended from time to time)
regarding the use of the Xxxx.
(d) The term of the limited right and license granted in
this Section 2.21 ("License") shall be for a period
from the Closing Date until expiration or termination
of the servicing agreement provided under Section
2.4(a) Closing Date ("Term"). Upon expiration of the
Term, Purchaser shall (i) cease using any advertising
materials, signs, sign faces, forms, invoices, or
other materials that bear the Xxxx; (ii) discontinue
use of the Xxxx, or any colorable imitation thereof,
in any manner or for any purpose, and discontinue
utilizing for any purpose the Xxxx or other xxxx that
suggests or indicates a current or prior connection
or association with Seller or its affiliates; (iii)
promptly take such action as may be required to
cancel all fictitious or assumed name or equivalent
registrations relating to Purchaser's use of the
Xxxx; and (iv) furnish to Seller within thirty (30)
days after the effective date of expiration of the
Term evidence satisfactory to Seller of compliance
with the foregoing obligations.
22
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE SELLER
As an inducement to cause the Purchaser to enter into this Agreement,
the Seller hereby represents and warrants to the Purchaser as follows, and each
representation and warranty shall survive until ninety (90) days following the
Closing Date or thereafter in the event that the Purchaser, on or before ninety
(90) days following the Closing Date, has given notice to the Seller of any
inaccuracy in or any breach of such a representation or warranty entitling the
Purchaser to indemnification pursuant to Section 2.19 hereof.
3.1 Corporate Organization. The Seller is a federal savings association
duly organized, validly existing and in good standing under the laws of the
United States of America having its principal office in Shelbyville, Indiana.
The Seller has the corporate power and authority, corporate and otherwise, to
(a) own the Assets and hold the Deposit Liabilities, (b) carry on its business
at the Branches as presently conducted, (c) execute, deliver and perform this
Agreement, and (d) effect the transactions contemplated hereby.
3.2 Corporate Authority. The execution, delivery and performance of
this Agreement, and the other agreements and documents contemplated hereby, by
the Seller, and the consummation by the Seller of the transactions contemplated
hereby, have been duly authorized by all necessary corporate action on the part
of the Seller in accordance with its Charter and By-Laws and all applicable
laws. This Agreement and all other agreements and documents contemplated hereby
executed and delivered by the Seller have been duly executed and delivered by
the Seller and constitute the valid and binding obligations of the Seller
enforceable against the Seller in accordance with their respective terms,
subject to the provisions of federal and other applicable bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium, receivership,
conservatorship and all other laws relating to or affecting the enforcement of
creditors' rights generally, now or hereafter in effect, and subject to public
policy and general principles of equity.
3.3 No Conflicts. Neither the execution, delivery or performance by the
Seller of this Agreement or any of the other agreements or documents
contemplated hereby nor the consummation by the Seller of the transactions
contemplated hereby or thereby, does or will, after the giving of notice, the
lapse of time or otherwise violate, conflict with, result in a breach of or
result in a default under (a) the Charter or By-Laws of the Seller, (b) any
provision of any promissory note, mortgage, indenture, lease or agreement to
which Seller is a party or to which the Assets are subject, or (c) any law,
statute, rule or regulation or any decree or order of any governmental authority
once the Governmental Approvals are obtained. No approval, authorization or
consent of any third party (other than the regulatory approvals and consents
referred to in Sections 5.5 and 5.7 hereof) is necessary to enable the Seller to
sell the Assets and transfer the Deposit Liabilities as contemplated by this
Agreement or to enable the Seller otherwise to perform its obligations
hereunder.
23
3.4 No Litigation. Except for lawsuits involving the collection of
delinquent accounts and garnishment proceedings in the ordinary course of
business, there are no claims, actions, suits, proceedings, arbitrations or
mediations in any court or before any government agency or authority,
arbitration panel, mediator, tribunal or otherwise pending or, to the knowledge
of the Seller, threatened against or affecting the Assets, the Deposit
Liabilities or the safe deposit business of the Seller or which would prevent
the performance of this Agreement by the Seller.
3.5 Assets.
(a) The Seller has good and marketable title to the
Assets free and clear of all liens, encumbrances,
security interests, mortgages, charges and the like
and, except as contemplated by this Agreement, has
not sold, transferred, assigned or pledged any of the
Assets. On the Closing Date, Seller will transfer,
assign and deliver to Purchaser good and marketable
title to the Assets free and clear of all liens,
encumbrances, security interests, mortgages, charges
and the like.
(b) The Seller is the sole owner of each of the Loans
(except for participations in the Loans); each of the
Loans is not pledged or encumbered; the principal
balance and amount of accrued but unpaid interest and
fees of each of the Loans as shown on the Seller's
books and records on the Closing Date is true and
correct; and each of the Loans (and all notes, other
evidences of indebtedness, mortgages and security
agreements associated therewith) are transferred to
the Purchaser hereunder without recourse and without
any representations or warranties as to the
collectibility of the Loans, the value of the
collateral securing the Loans or the creditworthiness
of any makers, guarantors or other obligors thereof.
(c) To the knowledge of the Seller, there is no
condemnation proceeding pending or threatened which
would preclude or impair the use of the Branches as
presently being used in the conduct of business of
the Seller.
(d) The Leased Property, Leased Equipment and the Fixed
Assets, taken as a whole, are in good operating
condition and repair, giving consideration to their
age and use and subject to ordinary wear and tear,
and will be received by the Purchaser in "AS IS"
condition, with no warranties by the Seller as to
condition, future performance, fitness for a
particular purpose or merchantability, except those
warranties related to title.
24
(e) No notice of any violation of zoning laws, building
or fire codes or other laws, statutes, ordinances,
codes or regulations relating to the operation of the
Branches has been received by the Seller.
3.6 Loans. Each of the Loans was made in the ordinary course of
business, and is accruing interest in accordance with the terms of such Loans.
To the knowledge of the Seller, except as may otherwise be indicated in the
applicable Loan file, each of the Loans is the legal, valid and binding
obligation of the obligor, maker, co-maker, endorser, debtor and any guarantor
(the "Obligors"), subject to bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium, receivership, conservatorship and laws relating to
or affecting creditor's rights generally and to public policy and to general
principles of equity, and no valid and legal defense, offset, counterclaim or
set-off has been asserted with respect to any of the Loans. Each of the Loans
may be assigned to Buyer without the approval or consent of any Obligor.
3.7 Deposits. All of the Deposit Liabilities were accepted and remain
in compliance in all material respects with all applicable laws, statutes,
rules, regulations and orders and are insured by FDIC to the maximum extent
provided in the rules and regulations of the FDIC. Except as otherwise disclosed
herein, the Seller has and will have at the Closing Date all right, title and
interest in all of the Deposit Liabilities to the extent customary for a
FDIC-insured institution free and clear of all pledges, liens and restrictions
on transfer.
3.8 Statements True and Correct. No representation or warranty made by
the Seller, nor any written information, certificate or document furnished or to
be furnished to the Purchaser pursuant to this Agreement or in connection with
the transactions contemplated by this Agreement, contains or will contain any
untrue statement of material fact or omits to state a material fact necessary to
make the statements herein or therein not misleading. The information relating
to the Branch Office provided or to be provided by the Seller will not omit to
state a material fact required to be stated therein or necessary to make such
statements contained therein not misleading.
3.9 Compliance with Laws. To the knowledge of the Seller, the Seller
has complied with all laws, statutes, rules, regulations and orders applicable
to the Real Property, the Fixed Assets, the safe deposit contracts, the Deposit
Liabilities, the Loans and the employees of Seller working at the Branches. No
notice or warning material to the current business or operations of the Branches
has been received from or threatened by any governmental authority with respect
to any failure or alleged failure of the Seller to comply in any respect with
any law, statute, rule, regulation or order.
25
3.10 No Brokers, Etc. The Seller has not employed or retained any
broker or finder or incurred any liability for any brokerage, finders' or
similar fees, commissions or expenses in connection with this Agreement or the
transactions contemplated hereby other than Donnelly, Penman, French, Xxxxxxxx &
Co. ("DPFH"). All fees, commissions, compensation and expenses of DPFH shall be
paid by the Seller.
3.11 Environmental Matters. To the knowledge of the Seller, the Leased
Property currently is and has while the Seller has been the lessee thereof
operated in compliance with all laws, statutes, rules and regulations relating
to hazardous substances or materials and to the safety and protection of the
environment.
3.12 Agreements Relating to Employees. There is no labor contract,
collective bargaining agreement, or employment agreement, with respect to any
officer or employee of Seller assigned to the Branches as of the date of this
Agreement.
3.13 Insurance. The Branches are adequately insured with respect to
risks normally insured against by companies similarly situated as Seller. All
policies of insurance covering the Branches are in full force and effect, and
the Seller has not filed any claim for insured losses in excess of $5,000
related to or arising from the operations of the Branches during the three-year
period immediately preceding the date of this Agreement.
3.14 Miscellaneous Agreements. All contracts, agreements, commitments
and arrangements to which Seller is a part and which related exclusively to any
of the Assets and Assumed Liabilities being acquired by the Purchaser are, to
the best of Seller's knowledge, valid and in full force and effect and, to the
best of Seller's knowledge, no breach or default (or event or condition, which
after notice to lapse of time or both, would constitute a breach or default)
exists with respect thereto.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
As an inducement to cause Seller to enter into this Agreement, the
Purchaser hereby represents and warrants to the Seller as follows, and each
representation and warranty shall survive until ninety (90) days following the
Closing Date or thereafter in the event that the Seller, on or before ninety
(90) days following the Closing Date, has given notice to the Purchaser of any
inaccuracy in or any breach of such a representation or warranty entitling the
Seller to indemnification pursuant to Section 2.19 hereof.
4.1 Corporate Organization. The Purchaser is a bank duly organized and
validly existing under the laws of the State of Ohio. The Purchaser has the
corporate power and authority, corporate or otherwise, to (a) own the Assets
being acquired hereunder and assume, perform, discharge and pay the Assumed
Liabilities, (b)
26
operate the Branches, (c) execute, deliver and perform this Agreement, and (d)
effect the transactions contemplated hereby.
4.2 Corporate Authority. The execution and delivery of this Agreement,
and all other agreements and documents contemplated hereby, by the Purchaser,
and the consummation of the transactions contemplated hereby, have been duly
authorized by all necessary corporate action on the part of the Purchaser in
accordance with its Articles of Incorporation and By-Laws and all applicable
laws. This Agreement and all other agreements and documents contemplated hereby
executed and delivered by the Purchaser have been duly executed and delivered by
the Purchaser and constitute the valid and binding obligations of the Purchaser
enforceable against the Purchaser in accordance with their respective terms,
subject to the provisions of federal and other applicable bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium, receivership,
conservatorship and laws relating to or affecting the enforcement of creditors'
rights generally, now or hereafter in effect, and subject to public policy and
general principles of equity.
4.3 No Conflicts. Neither the execution, delivery or performance by the
Purchaser of this Agreement or any other agreements or documents contemplated
hereby nor the consummation by the Purchaser of the transactions contemplated
hereby or thereby does or will, after the giving of notice, the lapse of time or
otherwise violate, conflict with, result in a breach of or result in a default
under (a) the Articles of Incorporation or By-Laws of the Purchaser, (b) any
provision of any promissory note, mortgage, indenture, lease or agreement, or
(c) any law, statute, rule or regulation or any decree or order of any
governmental authority once the Governmental Approvals are obtained. No
approval, authorization or consent of any third party (other than the regulatory
approvals and consents referred to in Sections 5.5 and 5.7 hereof) is necessary
to enable the Seller to sell the Assets and transfer the Deposit Liabilities as
contemplated by this Agreement or to enable the Seller otherwise to perform its
obligations hereunder.
4.4 No Litigation. There are no claims, actions, suits, proceedings,
arbitrations or mediations in any court or before any government agency or
authority, arbitration panel, mediator, tribunal or otherwise pending or, to the
knowledge of the Purchaser, threatened against or affecting the Purchaser which
would prevent the performance of this Agreement by the Purchaser.
4.5 Regulatory Matters. The Purchaser has received no notice or
communication from any state or federal banking regulatory agency indicating
that such agency would, and the Purchaser has no reason to believe any such
regulatory agency would, object to, or withhold any approval or consent
necessary for, the consummation by the Purchaser of the transactions
contemplated hereby. As of the date hereof, there is no pending or, to the best
of the Purchaser's knowledge, threatened legal or governmental proceedings
against the Purchaser or any affiliate of the Purchaser that would affect the
27
Purchaser's ability to obtain the regulatory approvals required in order to
consummate the transactions contemplated hereby.
4.6 Statements True and Correct. To the knowledge of the Purchaser, no
representation made by the Purchaser nor any written information, certificate or
document furnished or to be furnished to the Purchaser pursuant to this
Agreement or in connection with the transactions contemplated by this Agreement
contains or will contain any untrue statement of material fact or omits to state
a material fact necessary to make the statements herein or therein not
misleading.
4.7 No Brokers, Etc. The Purchaser has not employed or retained any
broker or finder or incurred any liability for any brokerage, finders' or
similar fees, commissions or expenses in connection with this Agreement or the
transactions contemplated hereby. To the best knowledge of Purchaser, no person
or party acting on behalf of the Purchaser may assert or claim against the
Seller or the Purchaser for a finder's fee, brokerage commission or other
similar payment relating to this Agreement or the transactions contemplated
hereby.
4.8 No Reliance. The Purchaser has consulted with such attorneys,
accountants and financial and other advisors regarding as it has deemed
appropriate in connection with its due diligence and review of transactions
contemplated by this Agreement and the execution of this Agreement and has not
relied upon any representations or warranties made by the Seller or any of its
agents except as set forth in this Agreement and the endorsements described in
Section 3.8 hereof.
ARTICLE V
CONDITIONS TO PURCHASER'S OBLIGATIONS
The obligations of the Purchaser to consummate the transactions
contemplated by this Agreement are conditioned upon the satisfaction, on or
before the Closing Date, of each of the following conditions (all or any of
which may be waived in whole or in part by the Purchaser, except for the
conditions in Section 5.5, which cannot be waived by the Purchaser):
5.1 Representations and Warranties True. The representations and
warranties made by the Seller in this Agreement shall be true, complete and
correct in all material respects on and as of the Closing Date as though such
representations and warranties were made at and as of such time.
5.2 Covenants Performed. The Seller shall have performed and complied
in all material respects with all obligations, covenants and agreements required
by this Agreement to be performed or complied with by it prior to or on the
Closing Date.
28
5.3 Officer's Certificate. The Seller shall have delivered to the
Purchaser a certificate of its President or any Vice President, dated at the
Closing Date, certifying to the satisfaction of each of the foregoing
conditions.
5.4 No Adverse Litigation. No claim, action, suit or proceeding shall
be pending or threatened against the Purchaser or the Seller as of the Closing
Date which might reasonably be expected to (a) materially and adversely affect
the Branches, the Assets or the Assumed Liabilities, or (b) materially and
adversely affect the transactions contemplated by this Agreement.
5.5 Regulatory Approvals. The Purchaser shall have received from the
appropriate regulatory authorities all Governmental Approvals (a) for the
transactions contemplated hereby, and (b) to operate each of the Branch Office
as a branch of the Purchaser. The Seller shall not have been notified by any
regulatory authority that the discontinued operation of the Branch Office by the
Seller would be a violation of any law, statute, rule or regulation or any
policy of any governmental authority.
5.6 Legal Opinion. The Purchaser shall have received a written opinion
from the law firm Xxxxx XxXxxxx LLP, dated as of the Closing Date, which shall
be in the form and substance reasonably acceptable to Purchaser.
5.7 Consent to Assignment of Leases. The lessors under each lease set
forth in Sections 1.3(c), (d) and (f) shall have consented on terms reasonably
satisfactory to both the Seller and the Purchaser, to the Seller's assignment of
the leases to the Purchaser.
5.8 No Material Damage. From the date of this Agreement until the
Closing Date, there shall have been no material damage to or destruction of the
Branches or the Leased Property.
5.9 Related Agreements. At or prior to the Closing, the Seller shall
have executed and delivered to the Purchaser all agreements, instruments,
documents and certificates contemplated by this Agreement required to be
executed and delivered by the Seller.
ARTICLE VI
CONDITIONS TO SELLER'S OBLIGATIONS
The obligations of the Seller to consummate the transactions
contemplated by this Agreement are conditioned upon the satisfaction, on or
before the Closing Date, of each of the following conditions (all or any of
which may be waived in whole or in part by the Seller, except for the conditions
in Section 6.5, which cannot or will not be waived by the Seller):
6.1 Representations and Warranties True. The representations and
warranties made by the Purchaser in this Agreement shall be
29
true, complete and correct in all material respects on and as of the Closing
Date as though such representations and warranties were made at and as of such
time.
6.2 Covenants Performed. The Purchaser shall have performed and
complied in all material respects with all obligations, covenants and agreements
required by this Agreement to be performed or complied with by it prior to or on
the Closing Date.
6.3 Officer's Certificate. The Purchaser shall have delivered to the
Seller a certificate of its President or any Vice President, dated at the
Closing Date, certifying to the satisfaction of each of the foregoing
conditions.
6.4 No Adverse Litigation. No claim, action, suit or proceeding shall
be pending or threatened against the Purchaser or the Seller as of the Closing
Date which might reasonably be expected to (a) materially and adversely affect
the Branches, the Assets or the Assumed Liabilities, or (b) materially and
adversely affect the transactions contemplated by this Agreement.
6.5 Regulatory Approvals. The Purchaser shall have received from the
appropriate regulatory authorities all Governmental Approvals (a) for the
transactions contemplated hereby, and (b) to operate the Branches as branches of
the Purchaser. The Seller shall not have been notified by any regulatory
authority that the discontinued operation of the Branches by the Seller would be
a violation of any law, statute, rule or regulation or any policy of any
governmental authority.
6.6 Legal Opinion. The Seller shall have received a written opinion
from the law firm of Xxxxx Xxxxx Xxxx LLC, dated as of the Closing Date, which
shall be in the form and substance reasonably acceptable to Seller.
6.7 Consent to Assignment of Leases. The lessors under each lease set
forth in Sections 1.3(c), (d) and (f) shall have consented on terms reasonably
satisfactory to both the Seller and the Purchaser, to the Seller's assignment of
the leases to the Purchaser.
6.8 Related Agreements. At or prior to the Closing, the Purchaser shall
have executed and delivered to the Seller all agreements, instruments, documents
and certificates contemplated by this Agreement required to be executed and
delivered by the Purchaser.
6.9 Fairness Opinion. At or prior to the Closing, the Seller shall have
received a fairness opinion from DPFH in a form and substance reasonably
satisfactory to the Seller.
30
ARTICLE VII
TERMINATION
7.1 Methods of Termination. This Agreement and the transactions
contemplated hereby may be terminated in any one of the following ways:
(a) at any time on or before the Closing Date by the
agreement in writing of the Purchaser and the Seller;
(b) on the Closing Date by the Purchaser in writing if
any of the conditions set forth in Article V of this
Agreement shall not have been satisfied or waived in
writing by the Purchaser;
(c) on the Closing Date by the Seller in writing if any
of the conditions set forth in Article VI of this
Agreement shall not have been satisfied or waived in
writing by the Seller;
(d) at any time on or before the Closing Date by the
Purchaser or the Seller in writing if the other shall
have been in breach of any representation or warranty
in any material respect (as if such representation or
warranty had been made on and as of the date hereof
and on the date of the notice of breach referred to
below), or in breach of any covenant, agreement or
obligation contained herein and such breach has not
been cured by the earlier of fifteen (15) days after
the giving of notice to the breaching party of such
breach or the Closing Date;
(e) by either the Seller or the Purchaser in writing at
any time after any of the regulatory authorities has
denied the application of the Purchaser for approval
of the transactions contemplated hereby or has
imposed a condition or requirement that is reasonably
unacceptable to the party on which the condition is
imposed; or
(f) by either the Seller or the Purchaser in writing if
the transactions contemplated hereby are not
consummated on or before one hundred twenty (120)
days from the date of this Agreement, unless extended
by a written agreement by Seller and Purchaser.
7.2 Procedure Upon Termination. In the event of termination pursuant to
Section 7.1 hereof, this Agreement shall thereupon terminate and be of no
further force or effect immediately upon receipt of the written notice required
hereby. If this Agreement is terminated as provided herein:
(a) each party shall (and shall cause its respective
employees, agents and representatives) to return to
31
the party furnishing the same all documents, work
papers and other materials of the other party
relating to the other party or to the transactions
contemplated hereby, whether obtained before or after
the execution hereof, to the party furnishing the
same; and
(b) all information received by either party hereto with
respect to the business, operations and customers of
the other party (other than information which is a
matter of public knowledge or which has heretofore
been or is hereafter published in any publication for
public distribution or filed as public information
with any governmental authority) shall not at any
time be used for any business purpose by such party
or disclosed by such party to third persons.
The requirements of this Section 7.2 shall be deemed to survive the termination
of this Agreement.
7.3 Liabilities Upon Termination. In the event of the termination of
this Agreement pursuant to the terms and provisions hereof, neither party hereto
shall have any liability hereunder of any nature whatsoever to the other,
including any liability for damages; provided, however, that (a) the foregoing
shall not preclude liability from attaching to a party who has intentionally
breached or violated the terms and provisions hereof, and (b) the termination of
this Agreement shall not terminate or affect the agreements of the parties
contained in Sections 8.5, 8.9 and 8.16 hereof or the agreements of the parties
hereto with respect to confidentiality contained in Section 2.3 hereof and in
the Confidentiality Agreement.
ARTICLE VIII
MISCELLANEOUS
8.1 Entire Agreement. This Agreement, the Exhibits hereto and the
Confidentiality Agreement supersede all other prior or contemporaneous
understandings, commitments, representations, negotiations, discussions and
agreements, whether oral or written or express or implied, between the parties
hereto relating to the matters contemplated hereby and constitute the entire
agreement between the parties hereto relating to the subject matter hereof.
8.2 Binding Effect; Assignment. This Agreement shall be binding upon
and inure to the benefit of the parties hereto and their respective heirs,
legatees, representatives, successors and assigns; provided, however, that
neither party related hereto may assign this Agreement without the prior written
consent of the other party, except that no consent shall be required if this
Agreement is assigned to any successor to Seller or Purchaser following the
Closing Date.
8.3 Amendment and Modification. The parties hereto may amend, modify or
supplement this Agreement only by an agreement in writing executed by the Seller
and the Purchaser.
32
8.4 Waiver or Extension. Either party hereto may by an instrument in
writing waive the performance by the other of any of the covenants or agreements
to be performed by such other party under this Agreement; provided, however,
that neither party may waive the requirement for obtaining the Governmental
Approvals. The failure of either party hereto at any time to insist upon the
strict performance of any covenant, agreement or provision of this Agreement
shall not be construed as a waiver or relinquishment of the right to insist upon
strict performance of such covenant, agreement or provision at a future time.
The waiver by any party hereto of a breach of or noncompliance with any
provision of this Agreement shall not operate or be construed as a continuing
waiver or a waiver of any other or subsequent breach or noncompliance hereunder.
8.5 Payment of Expenses. Except as otherwise specifically provided in
this Agreement, each party hereto shall bear and pay all costs and expenses
incurred by it or on its behalf in connection with this Agreement and the
transactions contemplated hereunder. Except as otherwise expressly provided
herein, any expense, fees and costs necessary for any Governmental Approvals or
for any notice to depositors of the assumption of the Deposit Liabilities
provided for in this Agreement shall be paid by the Purchaser.
8.6 Notices. All notices, requests and other communications hereunder
shall be in writing (which shall include facsimile communication) and shall be
deemed to have been duly given if (a) delivered by hand and receipted for, (b)
sent by certified United States Mail, return receipt requested, first class
postage pre-paid, (c) delivered by receipted overnight delivery service or (d)
delivered by facsimile transmission if such fax is confirmed immediately
thereafter by also mailing a copy of such notice, request or other communication
by certified United States Mail, return receipt requested, first class postage
pre-paid, as follows:
If to the Seller to: with a copy to (which shall not
constitute notice):
Shelby County Bank Xxxxx XxXxxxx LLP
29 East Washington Street Xxx Xxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxxxx, XX 00000 Xxxxxxxxxxxx, XX 00000
ATTN: Xxxxxxxx X. Xxxxxx, President ATTN: Xxxxxxx X. Xxxxxxxxx, Esq.
Telephone: (000) 000-0000 Telephone: (000) 000-0000
Telecopier: (000) 000-0000 Telecopier: (000) 000-0000
If to the Purchaser to: with a copy to (which shall not
constitute notice):
Community First Bank & Trust Xxxxx Xxxxx Xxxx LLC
x/x Xxxxx Xxxxxxxxx Xxxxxxx 0000 XXX Xxxxxx
000 Xxxx Xxxxxx 000 X. Xxxxx Xxxxxx
Xxxxxxxx, Xxxx 00000 Xxxxxxxxxx, Xxxx 00000-0000
ATTN: Xxxxx Xxxx ATTN: Xxxx Xxxxxxx
Telephone: (000) 000-0000 Telephone: (000) 000-0000
Telecopier: (000) 000-0000 Telecopier: (000) 000-0000
or such substituted address or person as either party has given to the other
in writing.
33
All such notices, requests and other communications shall be effective
(a) if delivered by hand, when delivered, (b) if mailed in the manner provided
herein, two (2) business days after deposit with the United States Postal
Service, (c) if delivered by overnight express delivery service, on the next
business day after deposit with such service, and (d) if by facsimile
transmission, on the date indicated on the fax confirmation page of the sender
if such fax also is confirmed by mail in the manner provided herein.
8.7 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but such counterparts shall
together constitute one and the same agreement.
8.8 Headings. The headings and defined terms in this Agreement have
been inserted and used solely for ease of reference and shall not be considered
in the interpretation, construction or enforcement of this Agreement.
8.9 Governing Law. This Agreement (including, without limitation, any
and all demands, controversies, claims, actions, causes of action, suits,
proceedings and litigation between or among the parties hereto arising out of or
relating to this Agreement or its breach, the construction of its terms or the
interpretation of the rights and duties of the parties) shall be governed by and
construed in accordance with the laws of the State of Indiana, without giving
effect to any choice or conflict of law provisions, principles or rules (whether
of the State of Indiana or any other jurisdiction) that would cause the
application of any laws of any jurisdiction other than the State of Indiana.
8.10 Severability. In case any one or more of the provisions (or any
portion thereof) contained herein shall, for any reason, be held to be invalid,
illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provision of this Agreement, but
this Agreement shall be construed as if such invalid, illegal or unenforceable
provision or provisions (or portion thereof) had never been contained herein. If
any provision of this Agreement shall be determined to be unenforceable by a
court of competent jurisdiction because of the provision's scope, duration or
other factor, then the court making such determination shall have the power to
reduce or limit such scope, duration or other factor, and such provision shall
then be enforceable against any party hereto in its reduced or limited form.
8.11 No Third-Party Rights. Nothing in this Agreement, expressed or
implied, is intended to confer upon any person, other than the parties hereto,
or their respective successors, any rights, remedies, obligations, or
liabilities under or by reason of this Agreement.
8.12 Construction. This Agreement is the product of negotiation by both
parties hereto and shall be deemed to have been drafted by both parties hereto.
This Agreement shall be construed in accordance with the fair meaning of its
provisions and its language shall not be strictly construed against, nor shall
ambiguities be resolved against, either party.
34
8.13 Certain References. Whenever in this Agreement a singular word is
used, it also shall include the plural wherever required by the context and
vice-versa. All references to the masculine, feminine or neuter genders herein
shall include any other gender, as the context requires.
8.14 Exhibits. The exhibits attached hereto are incorporated into and
made a part of this Agreement.
8.15 Facsimile. This Agreement may be executed and delivered by either
hereto party by facsimile transmission. For purposes of this Agreement, any
signature page signed and transmitted by facsimile machine or telecopier shall
be treated as an original document, and the signature of either party thereon,
for purposes hereof, shall be considered as an original signature and the
document transmitted shall be considered to have the same binding effect as an
original signature on an original document. Neither party may raise the use of a
facsimile machine or telecopier or the fact that any signature was transmitted
through the use of a facsimile machine or telecopier in accordance with this
Section as a defense to the enforcement of this Agreement, any amendment hereto
or any other document contemplated hereby.
8.16 Limitation on Damages. In no event shall either party hereto be
entitled to recover from the other party hereto special, punitive, incidental or
consequential damages (including without limitation damages based upon lost
profits or lost business opportunities) arising out of or relating to a breach
of the other party's representations, warranties, covenants or obligations under
this Agreement, even if the party in breach has been advised of the possibility
of such damages.
8.17 Survival of Representations, Warranties and Covenants. Each
representation and warranty of the Seller and the Purchaser, respectively,
contained in this Agreement or in any certificate, document or writing
contemplated hereby shall survive the Closing until ninety (90) days
following the Closing Date except in event that Seller or Purchaser has given
notice to the other of any inaccuracy in or breach of a representation or
warranty entitling the notifying party to indemnification pursuant to Section
2.19 hereof, and thereafter no party shall have any liability to the other with
respect thereto. All covenants, obligations, agreements, understandings and
acknowledgments of the Seller and the Purchaser, respectively, contained in this
Agreement or in any certificate, document or writing contemplated hereby shall
survive the Closing and shall continue to be in full force and effect following
the Closing in accordance with this Agreement and any certificate, document or
writing contemplated hereby.
35
IN WITNESS WHEREOF, the parties hereto have made and entered into this
Agreement as of the day and year first above written and have caused this
Agreement to be executed, attested and delivered by their duly authorized
officers.
SHELBY COUNTY BANK
By: /s/ Xxxxxxxx X. Xxxxxx
------------------------------
Xxxxxxxx X. Xxxxxx, President
ATTEST:
By: /s/ D. Xxxxxx Xxxxxxx
----------------------------------
D. Xxxxxx Xxxxxxx, Secretary
COMMUNITY FIRST BANK & TRUST
By: /s/ Xxx Xxxxxxx
-----------------------------
Xxx Xxxxxxx, President
ATTEST:
By: /s/ Xxxxx Xxxx
------------------------------------
Xxxxx Xxxx, Secretary
36
EXHIBIT 1.10
The payment required by Section 2.10 (the "Initial Payment") will be
the amount determined by the formula set forth below and (except as otherwise
stated below) will be determined using the figures shown on Seller's books and
records as of the close of business on the business day immediately preceding
the Closing Date. The Initial Payment will be:
(i) the sum of:
(A) all loans (including the Loans), net of unearned
income, plus the accrued but unpaid interest and fees
thereon; plus
(B) the net book value of the Fixed Assets as of the date
of this Agreement adjusted for any dispositions (but
not for any acquisitions) of any such assets after
the date of this Agreement; plus
(C) the face amount of the petty, teller, ATM and vault
cash maintenance at the Branch Offices; plus
(C) the pre-paid expenses associated with the Branches;
plus
(E) $15,000 related to the right to service the SCB CDs.
minus
(ii) the sum of:
(A) the deposit transaction accounts; plus
(B) the total amount of the certificates of deposit
listed on Schedule 1.10 plus the accrued but unpaid
interest and fees thereon.
(C) the out-of-pocket expenses related to the Xxxxxx
Lease, up to $115,000.00.
37
