EXHIBIT 2.1
Purchase and Assumption Agreement dated May 9, 2000 by and
between Mid State Bank and The Anchor Bank.
PURCHASE AND ASSUMPTION AGREEMENT
BY AND BETWEEN
THE ANCHOR BANK
AND
MID STATE BANK
May 9, 2000
THIS AGREEMENT IS SUBJECT TO BINDING ARBITRATION.
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This PURCHASE AND ASSUMPTION AGREEMENT (this "Agreement") is dated as of
May 9, 2000, by and between The Anchor Bank, a South Carolina banking
corporation headquartered in Myrtle Beach, South Carolina ("Seller"), and Mid
State Bank, a South Carolina banking corporation headquartered in Newberry,
South Carolina ("Purchaser"):
Preamble
WHEREAS, Purchaser and Seller operate banking operations;
WHEREAS, Seller wishes, upon the terms and conditions set forth herein, to
sell certain assets and to transfer certain deposit and other liabilities
associated with its operations to Purchaser;
WHEREAS, Purchaser wishes to buy such assets and assume such liabilities
upon the terms and conditions set forth herein;
NOW, THEREFORE, in consideration of the premises and agreements set forth
herein, and other good and valuable consideration, the receipt of which is
hereby acknowledged, the parties agree as follows:
Article 1
Definitions
Section 1.1 Definitions. As used in this Agreement, the following terms
have the definitions indicated.
"Accrued Interest Payable" means interest on Repurchase Agreements and/or
Deposits which is accrued but has neither been posted to a deposit account nor
paid as of the Closing Date.
"Accrued Interest Receivable" means interest on loans which is accrued but
unpaid as of the Closing Date.
"Adjustment Payment Date" shall have the meaning set forth in Section 4.3.
"Agreement" shall mean this Agreement, including all schedules and
exhibits attached hereto.
"Assets" shall have the meaning set forth in Section 2.1.
"Assumed Liabilities" shall have the meaning set forth in Section 2.3.
"ATM Site" means Seller's ATM site located at 000 Xxxxxx Xxxxxx, Xxxxxx,
Xxxxx Xxxxxxxx.
"ATM Lease" means the lease of the real estate, as amended, on which the
ATM Site is located.
"Branch" or "Branch Office" means Seller's branch office located at 000
Xxxxx Xxxx Xxxxxx, Xxxxxx, Xxxxx Xxxxxxxx.
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"Branch Deposit" means a Repurchase Agreement and/or Deposit, including
Accrued Interest Payable thereon, which has been opened at or assigned to the
Branch Office, other than Excluded Deposits.
"Branch Loan" means (i) any loan fully secured by any Branch Deposit, and
(ii) any checking line of credit or overdraft checking balance linked to any
Branch Deposit, and (iii) all other loans associated with the Branch Office as
listed on Schedule 2.1(e) hereto (it being acknowledged that Purchaser shall not
have to purchase any loan which is not covered by clauses (i), (ii) or (iii) of
this definition, which is a nonaccrual loan or any other loan ninety (90) days
or more past due as of the Effective Time), together with any Accrued Interest
Receivable thereon, the related Servicing Rights and all such loan documentation
as may be possessed by Seller with respect to such Branch Loans. At any time
prior to the tenth (10th) day before the date of Closing, Schedule 2.1(e) may be
supplemented by Seller upon written notice to Purchaser; provided however,
unless Purchaser consents in writing, Schedule 2.1(e) shall not include any loan
whose principal balance is equal to or greater than ten thousand dollars
($10,000) and which is entered into or renewed by Seller after the termination
of the Due Diligence Period (as defined below). Notwithstanding anything
contained herein to the contrary, the parties hereto acknowledge and agree that
during the period commencing on the date hereof and ending at midnight on the
fifteenth (15th) business day after the date hereof (the "Due Diligence
Period"), Purchaser shall be permitted to conduct a review of any and all Branch
Loans. In the event for any reason the Purchaser in its sole discretion finds
any such loan unacceptable to Purchaser, Purchaser may, at any time prior to
midnight of the sixteenth (16th) business day following the date hereof,
terminate this Agreement by delivering written notice to Seller. In such event,
this Agreement shall be null and void unless the parties hereto subsequently
agree otherwise in writing.
"Branch Premises" means the Real Property, and the improvements on the
Real Property and the real property subject to the ATM Lease.
"Branch Property" means all furniture, fixtures and equipment, and other
tangible personal property owned by Seller and located in the Branch Office
and/or ATM Site (except for Excluded Assets), including, without limitation, the
Branch Property described in Schedule 2.1(b) hereto.
"Brokered Deposit" means a deposit, obtained, directly or indirectly, by
or through any deposit broker as defined in Section 29(f) of the Federal Deposit
Insurance Act, 12 U.S.C. 1831(f) and the corresponding federal regulations,
without regard to whether or not the depository institution in which such funds
are deposited is not well capitalized for purposes of that section.
"Business Day" means any Monday, Tuesday, Wednesday, Thursday, or Friday
that is not a Federal or State holiday generally recognized by banks in the
State of South Carolina.
"Cash Items" means all cash items, suspense items and items in process of
collection, that are related to the Branch Deposits and Branch Loans and (i)
which, on the Closing Date, have not been outstanding and uncollected for a
period in excess of 30 days, or (ii) which otherwise are acceptable to
Purchaser.
"Closing" and "Closing Date" shall have the meanings assigned to them in
Section 4.1 of the Agreement.
"Closing Payment" shall have the meaning set forth in Section 3.2.
"Demand Deposits" means individual, partnership, corporate and any other
negotiable deposits, including, without limitation, NOW accounts.
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"Deposit" shall have the meaning set forth in Section 3(1) of the Federal
Deposit Insurance Act, 12 U.S.C. 1813(l), including, without limitation,
individual retirement accounts ("XXX") and cash management accounts.
"Depository Institution" means any bank or savings association as those
terms are defined in Section 3(c) of the Federal Deposit Insurance Act, 12
U.S.C. 1813(c), and any credit union.
"Effective Time" means the 12:01 a.m. on the Closing Date.
"Employees" means the employees assigned to the Branch Office from the
date of the Agreement through Closing.
"Equipment Leases" shall have the meaning set forth in Section 2.1(g).
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"Excluded Assets" shall have the meaning set forth in Section 2.2.
"Excluded Deposits" means (i) Brokered Deposits, (ii) deposits which are
the subject of attachment, garnishment or other legal process, (iii) such other
Deposits as are described on Schedule 2.4(a) hereto, and (iv) related Accrued
Interest Payable on such Excluded Deposits.
"FDIC" means the Federal Deposit Insurance Corporation.
"Federal Funds Rate" shall be the weighted daily mean of the high and low
rates quoted for Federal Funds in the Money Rates Column of The Wall Street
Journal, or if not reported for such day, the average of such quotations for the
last previous day for which such quotations were reported, for the period
between the Closing Date and the Adjustment Payment Date.
"Final Closing Statement" shall have the meaning set forth in Section 4.3.
"GAAP" means generally accepted accounting principles, applied on a
consistent basis.
"Jumbo Deposit" means a certificate of deposit with a balance of one
hundred thousand dollars ($100,000) or more.
"Net Book Value" means the value of an asset on the books of Seller as of
the Closing Date determined in accordance with GAAP, but without regard to any
general allowance for credit losses.
"Obligors" shall have the meaning set forth in Section 6.10(b).
"Post-Closing Delivery Date" shall have the meaning set forth in Section
4.3.
"Preliminary Closing Statement" shall have the meaning set forth in
Section 4.2.
"Purchase Price" shall have the meaning set forth in Section 3.1.
"Real Property" means the real property and all rights appurtenant thereto
on which the Branch and/or ATM Site are located.
"Repurchase Agreements" means all repurchase agreements associated with
the Branch Office listed on Schedule 2.1(h).
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"Safe Deposit Leases" means all safe deposit contracts and leases listed
on Schedule 2.1(f) for the safe deposit boxes located at the Branch Office (as
such Schedule may be amended by Seller as of the Effective Time), together with
Seller's keys to, and Seller's records related to, such contracts and leases.
"Servicing Rights" means the rights to service loans including, without
limitation, any rights to receive compensation with respect to such servicing.
Article 2
Transfer of Assets and Liabilities
Section 2.1 Sale of Assets. Subject to the terms and conditions set forth
herein, on the Closing Date, Purchaser shall purchase from Seller, and Seller
shall sell, assign, convey and transfer to Purchase all of Seller's right, title
and interest in the following assets and not otherwise excluded from transfer
pursuant to the provisions of Section 2.2 below (collectively, the "Assets"):
(a) all rights under and to the ATM Lease;
(b) the Branch Property and the Branch Premises;
(c) all currency and coins on hand at the close of business on the
Business Day immediately preceding the Closing Date;
(d) the Cash Items;
(e) the Branch Loans;
(f) the Safe Deposit Leases;
(g) all equipment leases which are acceptable to Purchaser in its sole
discretion and are listed on Schedule 2.1(g) for equipment or other
Branch Property located at the Branch Office and/or ATM Site (the
"Equipment Leases"); and
(h) the Repurchase Agreements.
Section 2.2 Assets Excluded from Sale. The following assets, among others,
(collectively, the "Excluded Assets") shall not be transferred pursuant hereto:
(a) all Seller's loans or other extensions of credit other than the
Branch Loans;
(b) all Seller signs;
(c) any intellectual property of Seller, including, without limitation,
all rights in the name "The Anchor Bank", "Anchor Financial
Corporation", "Carolina First Bank", "Carolina First Corporation" or
any combination or derivation thereof, corporate logos, trademarks,
trade names, service marks and service names, and any other similar
intellectual property, together with any paper stock, forms and
other supplies containing such names or intellectual property; and
(d) any other assets which Purchaser deems unnecessary or incompatible
with Purchaser's operation (e.g., teller equipment, computer
equipment, computer software, and automated teller machines), which
is identified in reasonable detail
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on Schedule 2.2(d) and any other assets listed on Schedule 2.2(d)
(as such Schedule may be amended by mutual agreement as of the
Effective Time).
Seller shall coordinate with Purchaser to remove the Excluded Assets from the
Branch Office and ATM Site on or prior to the Effective Time. Seller shall
remove the Excluded Assets at its own cost and shall repair any damage caused by
such removal. Upon such removal, Seller shall restore the Branch Office and ATM
Site, to their original condition.
Section 2.3 Assumption of Liabilities. Subject to the terms and conditions
set forth herein, on the Closing Date, Seller shall assign and transfer to
Purchaser, and Purchaser shall assume from Seller the following liabilities
(collectively, the "Assumed Liabilities"):
(a) the Branch Deposits and all obligations of Seller to provide
services incidental to the Branch Deposits; provided, however, that
Purchaser shall assume such obligations which are not customarily
undertaken by depository institutions in the State of South Carolina
in connection with Deposits only to the extent such obligations are
disclosed by Seller on Schedule 2.3(a) hereto (and agreed to by
Purchaser) and provided, further that Purchaser shall not assume
such obligations to the extent that such assumption is prohibited by
applicable law or by regulatory authorities;
(b) the ATM Lease and the Equipment Leases;
(c) any other liabilities set forth on Schedule 2.3(c).
Section 2.4 Liabilities Not Assumed. Except for the liabilities
specifically set forth in Section 2.3 of this Agreement or otherwise expressly
assumed herein, Purchaser are not assuming any other liabilities or obligations
of Seller, whether or not the same is in any way involved, either directly or
indirectly, with the operation by Seller of its business or to which Seller may
have become a party or liable by reason of its business. Liabilities not assumed
include, but are not limited to, the following:
(a) Excluded Deposits;
(b) Seller's cashier checks, money orders, interest checks and expense
checks issued prior to Closing, consignments of U.S. Government E
and XX xxxxx and any and all traveler's checks;
(c) liabilities or obligations with respect to any litigation, suits,
claims, demands or governmental proceedings arising, commenced or
made known to Seller prior to Closing;
(d) liabilities of Seller for or under any data processing contracts;
(e) liabilities related to the safe deposit boxes at the Branch Office
at the Closing Date or that can reasonably be determined to have
arisen prior to the Effective Time; and
(f) all other liabilities or obligations related to or arising from
Seller's operation of the Branch Office or Seller's business prior
to the Effective Time (except the Assumed Liabilities).
Section 2.5 Procedures regarding Deposits Assumed. Purchaser and Seller
agree to the following with respect to the Deposits assumed:
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(a) If, after the Closing Date, any such depositor, instead of accepting
the obligation of Purchaser to pay Deposit liabilities assumed,
shall demand payment from Seller for all or any part of any such
assumed Deposit Liabilities, Seller shall not be liable or
responsible for making such payment; provided, that if Seller pays
the same in accordance with sound banking practices, Purchaser
agrees to reimburse Seller for any such payments to the extent that
such depositor has funds on deposit with Purchaser. Seller and
Purchaser shall make appropriate arrangements to provide for the
daily settlement with immediately available funds by Purchaser of
checks, drafts, withdrawal orders, returns and other items presented
to and paid by Seller within 120 days after the Closing Date and
drawn on or chargeable to accounts that have been assumed by
Purchaser. In order to reduce the continuing charges to Seller
through the check clearing system of the banking industry that will
result from check, draft or withdrawal order forms of Seller being
used after the Closing Date by the depositors whose accounts are
assumed, Purchaser agrees, at its cost and expense, and without
charge to such depositors, to notify such depositors, on or before
the Closing Date, in a form and on a date mutually acceptable to
Seller and Purchaser, of Purchaser's assumption of Deposit
liabilities and to furnish each depositor of an assumed Demand
Deposit account with checks on the forms of Purchaser and with
instructions to utilize Purchaser's checks and to destroy unused
check, draft and withdrawal order forms of Seller. In addition,
subsequent to regulatory approval, Seller will notify the affected
customers by letter of the pending assignment of Seller's deposit
accounts to Purchaser, which notice shall be in a form mutually
agreeable to Seller and Purchaser.
(b) Purchaser agrees to pay promptly to Seller an amount equivalent to
the amount of any checks, drafts or withdrawal orders credited to an
assumed account as of the Closing Date that are returned to Seller
after the Closing Date.
(c) Seller agrees to provide to Purchaser after the Closing Date such
information as Purchaser may reasonably request to enable it to
conduct a core deposit intangibles analysis of the Deposit
liabilities.
(d) Seller will render a final statement to each depositor of an account
assumed under this Agreement as to transactions occurring through
the Effective Time and will comply with all laws, rules and
regulations regarding tax reporting of transactions of such accounts
through the Effective Time. Seller will be entitled to impose normal
(bank-wide) fees, including but not limited to, normal quarter-end
charges on savings accounts, or if the Closing does not occur at the
end of a quarter, a pro-rata portion of the normal quarter-end
charges on savings accounts, and service charges on a per-item
basis, but Seller will not impose periodic fees or blanket charges
in connection with such final statements.
(e) As of the Effective Time, Purchaser, at its expense, will notify all
Automated Clearing House ("ACH") originators of the transfers and
assumptions made pursuant to the Agreement. For a period of 120 days
beginning on the Effective Time, Seller will honor all ACH items
related to accounts assumed under this Agreement which are
mistakenly routed or presented to Seller. Seller will make no charge
to Purchaser for honoring such items. Items mistakenly routed or
presented after the 120-day period should be returned to the
presenting party.
(f) After the Closing Date, Purchaser agrees to use its reasonable best
efforts to collect from Purchaser's customers amounts equal to any
Visa or MasterCard charge backs under the MasterCard and Visa
Merchant Agreements between Seller and its customers or amounts
equal to any deposit items returned to Seller after the Closing Date
by its Federal Reserve Bank which were honored by Seller
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prior to the Closing Date and remit such amounts so collected to
Seller. Purchaser agrees to immediately freeze and remit to Seller
any funds up to the amount of the charged back or returned item that
had been previously credited by Seller if such funds are available
at the time of notification by Seller to Purchaser of the charged
back or returned item. Notwithstanding the foregoing, Purchaser
shall have no duty to remit funds for any item or charge that has
been improperly returned or charged to Seller.
Section 2.6 Interest Adjustment. Purchaser and Seller agree to make such
adjustment to interest paid on the Branch Deposits as may be necessary to
reconcile the differences in their respective methods of calculation of interest
to insure that depositors are paid the full amount of interest due to them.
Section 2.7 Safe Deposit Business. On and after the Effective Time,
Purchaser will assume and discharge Seller's obligations with respect to the
safe deposit box business at the Branch Office in accordance with the terms and
conditions of contracts or rental agreements related to such business which are
assigned to Purchaser, and Purchaser will maintain all facilities necessary for
the use of such safe deposit boxes by persons entitled to use them. On and after
the Effective Time, Purchaser shall maintain and safeguard the records related
to such safe deposit box business transferred hereunder, and Purchaser shall be
responsible for granting access to and protecting the contents of safe deposit
boxes at the Branch Office. Safe deposit box rental payment (not including late
payment fees) applicable for periods both prior to and after the Effective Time
and collected by Seller on or before the Effective Time shall be prorated as of
the Effective Time.
Section 2.8 Branch Loans Transferred.
(a) In connection with the transfer of any loans requiring notice to the
borrower, Seller agrees to comply with all notice and reporting
requirements of the loan documents or of any law or regulation.
(b) All Branch Loans or other indebtedness transferred under this
Agreement will be transferred without recourse and without any
warranties or representations as to their collectibility or the
creditworthiness of any of the Obligors of such Branch Loans.
(c) On and after the Closing Date, Purchaser will be responsible for
maintaining and safeguarding all Branch Loan files, documents and
records (which have been transferred to Purchaser by Seller) in
accordance with applicable law and sound banking practices.
Article 3
Purchase Price
Section 3.1 Purchase Price. As consideration for the purchase of the
Assets and the assumption of liabilities hereunder, Purchaser shall pay to
Seller, in the form and subject to the conditions set forth below, an aggregate
purchase price calculated as follows (the "Purchase Price"):
(a) One Hundred Percent (100%) of the Net Book Value of the Branch
Property and Branch Premises as shown on the most recent financial
statements of Seller immediately prior to the Closing Date; plus
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(b) One Hundred Percent (100%) of the face value of all currency and
coins on hand at the Branch Office on the Closing Date; plus
(c) One Hundred Percent (100%) of the face value of all Cash Items; plus
(d) Ninety-Eight Percent (98.0%) of the Net Book Value of the Branch
Loans; minus
(e) Ninety-Two Percent (92.0%) of the total amount of the Branch
Deposits on deposit in Seller on the Closing Date excluding Jumbo
Deposits; minus
(f) One hundred Percent (100.00%) of the total amount of the Branch
Deposits which are Jumbo Deposits.
It is expressly understood that such Purchase Price is determined for
purposes of calculating amounts due from the Purchaser to the Seller or from the
Seller to the Purchaser and, except as may otherwise be stated explicitly by the
parties, does not represent any agreement between the parties as to the
determination of values of Assets for accounting or tax purposes.
Section 3.2 Payment of the Purchase Price. If the results of the above
calculations are positive, that amount shall be paid by Purchaser to Seller, but
if the results of the above calculation are negative, that amount shall be paid
by Seller to Purchaser (in either case, the "Closing Payment"). The components
of the Purchase Price shall be set forth on the Preliminary Closing Statement.
All sums shall be paid in cash at Closing, by way of wire transfer of funds.
Amounts paid at Closing shall be subject to subsequent adjustment based on the
Final Closing Statement.
Article 4
The Closing
Section 4.1 The Closing. The closing of the transactions contemplated here
(the "Closing") shall take place on a date (the "Closing Date") as soon as
reasonably practicable after receipt of all regulatory approvals and consents
required in connection herewith and the expiration of all waiting periods
required by law or regulation in connection with such approvals and consents, at
the offices of Xxxxxx Xxxxx Xxxxxx & Xxxxxxx, LLP, 0000 Xxxx Xxxxxx, Xxxxx 0000,
Xxxxxxxx, Xxxxx Xxxxxxxx, or at such other place and time as the parties hereto
may mutually agree; provided, however, that in the event that Closing has not
occurred by July 7, 2000, either party hereto shall have the right to terminate
this Agreement.
Section 4.2 Preliminary Closing Statement. Seller shall prepare a closing
statement (the "Preliminary Closing Statement") in accordance with GAAP as of a
date not earlier than 30 days prior to the Closing Date reflecting the
calculation of the Purchase Price, including the assets to be sold and assigned
hereunder and the liabilities to be transferred and assumed hereunder; provided,
however, that the Preliminary Closing Statement shall reflect actual balances as
of a date not more than 7 days prior to the Closing Date for coins and currency
and deposits.
Section 4.3 Post-Closing Adjustments.
(a) Not later than 10 calendar days after the Closing Date (the
"Post-Closing Delivery Date"), Seller shall deliver to Purchaser a
final closing statement dated as of the Closing Date and prepared in
accordance with GAAP reflecting the Assets sold and assigned and the
liabilities transferred and assumed hereunder as of the Closing Date
(the "Final Closing Statement"). Seller shall afford Purchaser and
its accountants and attorneys the opportunity to review all work
papers and documentation used by Seller in preparing the Final
Closing Statement. Within 10
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calendar days following the Post-Closing Delivery Date (the actual
date being "Adjustment Payment Date"), Seller and Purchaser shall
effect the transfer of any funds as may be necessary to reflect
changes in such assets and liabilities between the Preliminary
Closing Statement and the Final Closing Statement together with
interest thereon computed from the Closing Date to the Adjustment
Payment Date at the applicable Federal Funds Rate. Adjustments shall
be made for all items which would adjust the amount of assets
transferred and liabilities assumed, including but not limited to,
not-sufficient-funds checks, mis-postings and accounting errors.
Without limiting the foregoing, if the balance due on any Branch
Loan purchased has been reduced by Seller as a result of a payment
by check received prior to the Effective Time, which item is
returned after the Closing Date, the asset value represented by the
Branch Loan transferred shall be correspondingly increased and an
amount in cash equal to such increase shall be paid by Purchaser to
Seller promptly upon demand.
(b) In the event that a dispute arises as to the appropriate amounts to
be paid to either party on the Adjustment Payment Date, each party
shall pay to the other on such Adjustment Payment Date all amounts
other than those as to which a dispute exists. 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 thereon from the Adjustment Payment Date to the date
paid at the applicable Federal Funds Rate. The parties agree to
arbitrate any disputes arising under this subsection (b).
Arbitration shall be by single arbitrator experienced in the matters
at issue and selected by the Purchaser and the Seller and in
accordance with the Commercial Arbitration Rules of the American
Arbitration Association. In the event the parties cannot agree on an
arbitrator, each party shall select an arbitrator and the two
arbitrators shall select a third. The arbitration shall be held in
such place in Columbia, South Carolina as may be specified by the
arbitrator(s), and shall be conducted in accordance with the
Commercial Arbitration Rules existing at the date thereof of the
American Arbitration Association to the extent not inconsistent with
this Agreement. The decision of the arbitrator(s) shall be final and
binding as to any matters submitted, and any judgment thereon
promptly shall be satisfied; provided, however, that if necessary,
such decision and satisfaction may be enforced by either Purchaser
or Seller in any court of record having jurisdiction over the
subject matter or over any of the parties of this Agreement. All
costs and expenses incurred in connection with any such arbitration
proceeding shall be borne by the party against which the decision is
rendered, or, if no decision is rendered, or if the decision is a
compromise, equally by Purchaser as one party and Seller, as the
other party.
Section 4.4 Closing Deliveries of Seller at Closing. At the Closing, the
following shall be delivered by Seller (or caused to be delivered by Seller) to
Purchaser:
(a) General Warranty Deed with respect to the Real Property ("Deed") and
assignment of ATM Lease (the "Assignment and Assumption of Lease
Agreement") in substantially the form as attached hereto in Exhibit
A, together with the consent and estoppel of the lessor under such
ATM Lease. The parties hereto acknowledge and agree that Purchaser
may assign its right to acquire the Real Property to Community
Capital Corporation, the sole shareholder of Purchaser;
(b) A Xxxx of Sale, in substantially the form attached hereto as Exhibit
B (the "Xxxx of Sale").
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(c) An assignment and assumption agreement, in substantially the form
attached hereto as Exhibit C (the "Assignment and Assumption
Agreement");
(d) Consents from third persons that are required to effect the
assignment set forth in the Assignment and Assumption Agreement,
including, but not limited to, the lessors under the ATM Lease and
any Equipment Leases (to the extent required);
(e) A certificate of a proper officer of Seller, dated the Closing Date,
certifying to the fulfillment of all conditions which are the
obligation of Seller that all of the representations and warranties
of Seller set forth in this Agreement remain true and correct in all
material respects on the Closing Date;
(f) Certified copies of (A) the Articles of Incorporation and Bylaws of
Seller, and (B) a resolution of the Board of Directors of Seller,
approving the transactions contemplated hereby;
(g) An opinion of counsel reasonably acceptable to Purchaser's counsel
covering matters typically included in transactions of this type,
including opinions to the effect that (A) Seller is duly organized,
validly existing and in good standing under the laws of South
Carolina, (B) this Agreement, the Deed, the Assignment and
Assumption of Lease Agreement, the Xxxx of Sale and the Assignment
and Assumption Agreement have been duly authorized, executed and
delivered by Seller and are the legal, valid and binding agreements
of Seller enforceable against Seller in accordance with their terms,
except as enforcement may be limited by bankruptcy, fraudulent
conveyance, insolvency or similar laws or equitable principles
affecting the enforcement of creditors' rights generally or
depository institutions the accounts of which are insured by the
FDIC and except as enforcement is subject to general principles of
equity, whether applied in a proceeding in equity or at law, and (C)
all proceedings or consents required by law or regulation to be
taken or obtained by Seller in connection with the transactions
provided for by this Agreement have been duly and validly taken or
obtained;
(h) Such incumbency and other certificates and other documents as
Purchaser and its counsel may reasonably require to evidence the
receipt by Seller of all necessary corporate and regulatory
authorizations and approvals for the consummation of the
transactions provided for in this Agreement;
(i) The Preliminary Closing Statement;
(j) All Assets capable of physical delivery;
(k) A letter addressed to Purchaser from a reputable heating and air
conditioning service company stating that an inspection was made of
the heating and air conditioning system of the Branch Office and ATM
Site within 20 days of Closing and that at such inspection the
systems were in good working condition;
(l) A letter addressed to Purchaser from a reputable pest control
company stating that an inspection was made of the Branch Office and
ATM Site within 20 days of the Closing and that at the time of such
inspection there was no termite or other insect infestation, no
decay fungi or fungi damaged wood, no excessive moisture conditions
and no mold or sap stain fungi; and
(m) Copies of all Repurchase Agreements.
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Section 4.5 Documents of Purchaser to be Delivered at Closing. At Closing,
the following documents shall be delivered by Purchaser (or caused to be
delivered by Purchaser) to Seller:
(a) The Assignment and Assumption of Lease Agreement;
(b) The Assignment and Assumption Agreement;
(c) A certificate and receipt acknowledging the delivery and receipt of
possession of the property and records referred to in this
Agreement.
(d) A certificate of proper officers of Purchaser, dated the Closing
Date, certifying to the fulfillment of all conditions which are the
obligation of Purchaser and that all of the representations and
warranties of Purchaser set forth in this Agreement remain true and
correct in all material respects on the Closing Date;
(e) Certified copies of (A) the Articles of Incorporation and Bylaws of
Purchaser, and (B) a resolution of the Board of Directors of
Purchaser, approving the transactions contemplated hereby;
(f) An opinion of counsel reasonably acceptable to Seller's counsel
covering matters typically included in transactions of this type,
including opinions to the effect that (A) Purchaser is duly
organized, validly existing and in good standing under the laws of
South Carolina, (B) this Agreement, the Assignment and Assumption of
Lease Agreement, and the Assignment and Assumption Agreement have
been duly authorized, executed and delivered by Purchaser and are
the legal, valid and binding agreements of Purchaser enforceable
against Purchaser in accordance with their terms, except as
enforcement may be limited by bankruptcy, fraudulent conveyance,
insolvency or similar laws or equitable principles affecting the
enforcement of creditors' rights generally or depository
institutions the accounts of which are insured by the FDIC and
except as enforcement is subject to general principles of equity,
whether applied in a proceeding in equity or at law, and (C) all
proceedings or consents required by law or regulation to be taken or
obtained by Purchaser in connection with the transactions provided
for by this Agreement have been duly and validly taken or obtained;
(g) Such certificates and other documents as Purchaser and its counsel
may reasonably require to evidence the receipt by Purchaser of all
necessary corporate and regulatory authorizations and approvals for
the consummation of the transactions provided for in this Agreement;
and
(h) The Preliminary Closing Statement.
Section 4.6 Magnetic Media Records. Seller agrees to prepare at its
expense and deliver to Purchaser magnetic media records in a format consistent
with BISYS file not later than 20 days prior to the Closing Date, and further
shall deliver to Purchaser such records updated on the Closing Date, which
records shall contain the information related to the Branch Loans and Deposits
assumed above.
Article 5
Representations and Warranties of Purchaser
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Purchaser hereby warrants and represents to Seller as set forth below,
which representations and warranties shall survive the Closing Date for a period
equal to twenty-four (24) months from the Closing Date (the "Warranty Period").
Section 5.1 Corporate Organization. Purchaser is a corporation duly
organized, validly existing and in good standing under the laws of the State of
South Carolina.
Section 5.2 Enforceable Agreement. This Agreement has been duly and
validly authorized, executed and delivered by Purchaser and is a valid, binding,
and enforceable obligation of Purchaser.
Section 5.3 No Violation. The consummation of the transactions
contemplated by this Agreement will not result in the breach of any term or
provision of Purchaser's charter or bylaws, nor result in the breach of any term
or provision of, nor conflict with, nor constitute a default under, nor result
in, the acceleration of any obligation under any agreement or other instrument
to which Purchaser or its property is subject, nor result in the violation of
any law, rule, regulation, order, judgment or decree to which the Purchaser is
subject. There is no action, suit or proceeding pending against the Purchaser,
or to its knowledge threatened, before any court or arbitrator or any
governmental body, agency or official which could materially and adversely
affect the ability of Purchaser to perform its obligations under this Agreement
or which in any manner questions the validity of this Agreement.
Section 5.4 Broker or Finder. Purchaser has not employed any broker or
finder in connection with this transaction.
Section 5.5 Necessary Consents. Except for any necessary filings with, and
approvals and authorizations of the applicable bank regulatory authorities, or
except as expressly contemplated herein, no consent, approval, authorization,
registration, or filing with any governmental authority or private third party,
is required on the part of Purchaser in connection with the execution and
delivery of this Agreement or the consummation by Purchaser of the transactions
contemplated hereby (except such consents, approvals authorizations
registrations or filings as shall have been made or obtained on or before
Closing).
Section 5.6 Information for Regulatory Applications. The information
furnished or to be furnished by the Purchaser to Seller for the purpose of
enabling Seller to complete and file applications with any regulatory body is or
will be true and complete in all material respects as of the date so furnished.
Article 6
Representations and Warranties of Seller
Seller warrants and represents to Purchaser as follows, which
representations and warranties shall survive the Closing Date for the duration
of the Warranty Period:
Section 6.1 Corporate Organization. Seller is a South Carolina corporation
duly organized, validly existing, and in good standing under the laws of the
South Carolina and has the corporate power and is duly qualified to carry on its
business where and as now conducted and to own the Branch Property and operate
the Branch Office and ATM Site.
Section 6.2 Enforceable Agreement. This Agreement has been duly and
validly authorized, executed and delivered by Seller and is a valid, binding,
and enforceable obligation of Seller.
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Section 6.3 No Violation. The consummation of the transactions
contemplated by this Agreement will not result in the breach of any term or
provision of Seller's charter or its bylaws, nor result in the breach of any
term or provision of, nor conflict with, nor constitute a default under, nor
result in, the acceleration of any obligation under any agreement or other
instrument to which Seller or any of its property is subject, nor result in the
violation of any law, rule, regulation, order, judgment or decree to which
Seller is subject.
Section 6.4 Broker or Finder. Seller has not employed any broker or finder
in connection with this transaction.
Section 6.5 Marketable Title. The Assets, when transferred, shall be sold,
assigned, transferred, and conveyed free and clear of (i) all liens,
encumbrances, security interests or charges of any kind except as specifically
provided otherwise herein, and (ii) all liabilities and obligations of Seller,
except as provided herein.
Section 6.6 Branch Premises and Branch Property. The following
representations are made with respect to the Branch Premises and the Branch
Property.
(a) Seller has not utilized, discharged, dispersed, released, stored,
generated, disposed of, or allowed to escape on the Branch Premises
and/or ATM Site, any pollutants or other toxic or hazardous
substances except for cleaning supplies used in reasonable amounts
and for their ordinary purpose. Seller has not installed, used,
incorporated into, or disposed of any asbestos or
asbestos-containing materials in or on the Branch Premises and/or
ATM Site. Seller has not used or disposed of any poly-chlorinated
biphenyls on or in the Branch Premises, ATM Site, or the Branch
Property in any form. To the best of Seller's knowledge, no
underground storage tanks are located on the Branch Premises and/or
ATM Site or were located on the Branch Premises and/or ATM Site and
were subsequently removed or filled. To the best of Seller's
knowledge, no investigation, administrative order, consent order and
agreement, litigation, or settlement with respect to any hazardous
or toxic substances is proposed, threatened, anticipated or in
existence with respect to the Branch Premises and/or ATM Site.
Seller has no knowledge of information concerning (i) pollutants or
other toxic or hazardous substances which may be on the Branch
Premises and/or ATM Site as a result of any acts, or failures to act
by third parties, or (ii) any condition of the Branch Premises, ATM
Site or Branch Property which may reasonably be expected to result
in environmental liability to Purchaser.
(b) Except as expressly provided herein, no other representations are
made with respect to the Branch Premises or the Branch Property and
Purchaser agrees that such Branch Premises and Branch Property are
being acquired "as is."
(c) Seller does hereby grant to Purchaser, its agents, engineers,
surveyors, appraisers, auditors and other representatives the right
to enter upon the Branch Office and ATM Site to inspect, examine and
survey, obtain engineering inspections, appraise and otherwise do
that which, in the reasonable opinion of Purchaser is necessary to
determine the title, boundaries, acreage and condition of the Branch
Office, ATM Site, and Branch Property, to determine the suitability
of the Branch Office, ATM Site and Branch Property for the uses
intended by Purchaser, its topographical conditions, the presence or
absence of subsurface water and rock, and to make all necessary
tests to determine the title, suitability, structure, and physical
condition of the Branch Office, ATM Site and Branch Property.
Purchaser agrees to indemnify and hold Seller harmless from and
against all losses, damages, costs and expenses incurred by Seller
arising out of Purchaser's performance of such surveys, studies and
tests. Seller agrees to cooperate fully
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with Purchaser and Purchaser's agents and representatives in the
conduct and performance of the various surveys, reviews,
investigations, audits, inspections and other examinations
contemplated herein. If Purchaser objects to the condition of title,
suitability, structure, or physical condition (including but not
limited to electric system, plumbing, and roof) of the Branch
Office, ATM Site or any other portion thereof, Purchaser shall give
Seller written notice of the deficiency ("Repair Items"). In the
event that such Repair Items will cost $100,000 or less to repair,
Seller shall repair such Repair Items on or before Closing to
Purchaser's satisfaction. In the event that such Repair Items will
cost more than $100,000 in the aggregate to repair, Seller shall not
have the obligation to repair such Repair Items, and in the event
that Seller elects not to repair, Purchaser may terminate this
Agreement (although, in the event that such Repair Items exceed
$100,000, Purchaser may require Seller to pay the $100,000 and
proceed to Closing).
Section 6.7 Legal Action. There is no action, suit, proceeding or
investigation pending, nor to the knowledge of Seller, threatened against Seller
before any court, arbitrator or administrative or governmental body which may
result in any materially adverse change in the Assets or Branch Deposits or
which could materially and adversely affect the ability of Seller to perform its
obligations under this Agreement or which in any manner questions the validity
of this Agreement. Seller is not subject to any injunction, order or decree of
any court or administrative agency (directed only at Seller) which relates to or
affects the Branch Office and/or ATM Site.
Section 6.8 Accuracy of Records. As of the Closing Date, all records
related to the Branch Deposits and the Assets, which will be transferred to
Purchaser by Seller hereunder are true and correct in all material respects,
including genuineness of signatures.
Section 6.9 Information for Regulatory Applications. The information
furnished or to be furnished by Seller to Purchaser for the purpose of enabling
Purchaser to complete and file applications with any regulatory body is or will
be true and complete in all material respects as of the date so furnished.
Section 6.10 Branch Loans. The following representations are made with
respect to the Branch Loans:
(a) None of the Branch Loans were made or administered in violation of
any law, regulation or ordinance, including without limitation, the
South Carolina Consumer Protection Code, the Federal
Truth-in-Lending Act and all regulations promulgated thereunder, and
all applicable consumer credit or usury laws of any applicable
jurisdiction, such that its enforceability or the benefits inuring
to the Purchaser thereunder would be impaired in any material
respect.
(b) Each of the Loans (i) is a valid and binding obligation of each
obligor, maker, co-maker, guarantor, endorser or debtor (such
persons hereinafter collectively referred to as "Obligors") thereof
or thereunder and is evidenced by valid and binding promissory notes
and, as the case may be, instruments of security executed by the
respective Obligors, each of whom at the time of such execution had
capacity to contract and each of whose signatures on such
instruments is such person's true signature, (ii) is enforceable in
accordance with its terms (except for applicable bankruptcy or
similar laws affecting the enforcement of creditors rights
generally), and no Obligor with respect to any of the Loans has or
will have any right of defense, setoff or counterclaim against
Seller, and (iii) is free from any events of default thereunder by
Seller which impair collectibility.
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Section 6.11 Compliance with Laws. Seller is in material compliance with
all laws, ordinances, and regulations that govern such Seller's ownership and
present use of the Assets, Branch Premises, ATM Site, Branch Office and Branch
Property, the violation of which would have a material adverse effect on the
Assets, the Branch Premises, ATM Site, Branch Office, or Branch Property. To
Seller's actual knowledge, all of the Assets, Branch Office, ATM Site, Branch
Premises, and Branch Property sold hereunder, materially comply with applicable
environmental, zoning, health, OSHA, consumer products, and fire safety
regulations.
Section 6.12 Necessary Consents. Except for any necessary filings with,
and approvals and authorizations of the applicable bank regulatory authorities,
or except as expressly contemplated herein, no consent, approval, authorization,
registration, or filing with any governmental authority or private third party,
is required on the part of Purchaser in connection with the execution and
delivery of this Agreement or the consummation by Purchaser of the transactions
contemplated hereby (except such consents, approvals authorizations
registrations or filings as shall have been made or obtained on or before
Closing).
Section 6.13 Worker's Compensation. There are no worker compensation or
similar claims or actions pending or, to Seller's knowledge threatened, and
Seller does not know of acts which would make such claims timely, by employees
of Seller currently employed at the Branch Office.
Section 6.14 Payables. Except for specific liabilities expressly assumed
hereunder, Seller will pay all accounts payable, taxes, assessments, and charges
respecting the Assets, the ATM Site, or the Branch Office incurred prior to the
Effective Time within a reasonable amount of time following Closing, except for
any such accounts payable, taxes, assessments or charges which are being
reasonably contested in good faith.
Section 6.15 Zoning. The Branch Premises and ATM Site are in compliance
with applicable zoning laws and ordinances and such officer is not aware that
the status of such zoning is in question or subject to change by the appropriate
governmental authorities.
Section 6.16 Disclosure. All information and data furnished by Seller to
Purchaser with respect to the Assets, Branch Office, ATM Site, Branch Premises,
and Branch Property is materially true, correct, and complete, and not
materially misleading.
Article 7
Covenants of the Parties
Section 7.1 Access. Seller shall afford to the officers and authorized
representatives of the Purchaser, upon prior notice, access to the properties,
books, and records pertaining to the Branch Office and ATM Site in order that
Purchaser may have full opportunity to make reasonable investigations, at
reasonable times without interfering with Seller's normal business and
operations, of the affairs of the Seller which relate to the Branch Office, ATM
Site and their respective condition. The officers of Seller shall furnish
Purchaser with such additional financial and operating data and other
information as to its business and properties as Purchaser may, from time to
time, reasonably request and as shall be available, including, without
limitation, information required for inclusion in all governmental applications
and filings necessary to effect this transaction. In the event an audit is
required by any governmental agency on the Branch Office, ATM Site, and/or
Seller's operations conducted thereat, Seller shall timely cooperate and assist
Purchaser, at Purchaser's expense, with all reasonable requests for information
and documentation submitted to Seller by Purchaser or Purchaser's accountants.
Nothing in this paragraph shall be deemed to require Seller to breach any
obligation of confidentiality or to reveal any proprietary information, trade
secrets or marketing or strategic plans. Without limiting the foregoing, as of
the date hereof, Seller will provide Purchaser with
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access to Seller's environmental records and such rights of investigation as are
possessed by Seller with respect to the Branch Premises and ATM Site for
purposes of conducting environmental investigations. The cost of any such
investigation shall be borne entirely by Purchaser.
Section 7.2 Fees and Expenses. Purchaser shall be responsible for the
payment of all regulatory fees related to this transaction. Purchaser shall not
be responsible for any income tax liability of Seller arising from the business
or operations of Seller on or before the Closing Date, and Seller shall not be
responsible for any tax liabilities of Purchaser arising from the business or
operations of the Branch Office or ATM Site after the Closing Date. Utility
payments, telephone charges, real property taxes, personal property taxes, rent,
salaries, deposit insurance premiums, other ordinary operating expenses of
Seller and other standard expenses related to the liabilities assumed or assets
purchased hereunder shall be prorated between the parties as of the Closing
Date. Purchaser shall be responsible for the costs of all title examinations,
title insurance fees, surveys, its own attorneys' and accountants' fees and
expenses, recording costs, transfer fees, and other expenses arising in
connection therewith. Seller shall be responsible for its own attorneys' and
accountants' fees and expenses related to this transaction and documentary
stamps and deed recording fees relating to the Real Property and Assignment and
Assumption of Lease Agreement. Any items which are required to be prorated
hereunder which cannot be prorated, because of a lack of sufficient information,
by the Closing Date shall be prorated as soon as the requisite information is
available. The post closing adjustments necessitated by any such proration shall
be effected on the Adjustment Payment Date.
Section 7.3 Regulatory Approvals. Each party shall use its respective best
efforts to obtain all necessary regulatory approvals. Within 30 days following
the execution of this Agreement, Purchaser shall prepare and file applications
required by law with the appropriate regulatory authorities for approval to
consummate the transactions contemplated herein. Purchaser agrees to proceed
with the preparation of such applications in a diligent manner and to provide
Seller with a copy of all such applications filed (except for any confidential
portions thereof).
Section 7.4 Conduct of Business Pending Closing. From the date hereof to
Closing, Seller covenants and agrees to the following:
(a) Seller shall conduct its business only in the ordinary course;
maintain a pricing structure of deposit liabilities consistent with
local market conditions and good business practice, and not increase
interest rates paid on deposit liabilities above those generally
offered in the Branch Office's markets; use its best efforts to
preserve its business operation as conducted, and to preserve for
the Purchaser the good will of its customers; exercise reasonable
efforts to cooperate with and assist Purchaser in assuring the
orderly transition of such business from the Seller to Purchaser;
provided, however, that nothing in this paragraph shall be construed
as requiring Seller to engage in activities or efforts outside the
ordinary course of business as presently conducted;
(b) Except as disclosed in Schedule 7.4(b), Seller shall not enter into
any contracts on behalf of or affecting the Assets, ATM Site or the
Branch Office in excess of $5,000 without prior consent of
Purchaser.
(c) Seller shall maintain (i) insurance sufficient to replace the Assets
in the event of their destruction, and (ii) all other insurance
policies in existence on the date hereof at their current levels.
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(d) Seller shall maintain the Branch Premises, ATM Site and Branch
Property in its current condition and in a manner conducive to
normal business operations, ordinary wear and tear excepted.
Section 7.5 Removal of Signs. Seller agrees to repair any damage caused by
the removal of the signs which are not being transferred to Purchaser hereunder.
Section 7.6 Transfer of Records. Seller shall assign, transfer and deliver
to Purchaser such of the following records pertaining to the Deposits as exist
and are available in whatever form or medium is maintained by Seller: (A)
signature cards, orders and contracts between the Seller and depositors, and
records of similar character, (B) deposit slips and canceled checks or
withdrawal orders representing charges to depositors, and (C) records of account
maintained at the Branch Office. Seller shall retain all books and records of
account relating to the Branch Deposits which are not ordinarily maintained at
the Branch Office, shall maintain such books and records of account for as long
as may be required by applicable law for the joint benefit of itself and the
Purchaser, and will permit the Purchaser or its representatives, at any
reasonable time and at the Purchaser's expense, to inspect, make extracts from
or copies of, any such files, books of account, or records as Purchaser shall
deem reasonably necessary.
Section 7.7 Maintenance of Records by Purchaser. On and after the Closing
Date, Purchaser shall become responsible for maintaining the files, documents
and records delivered to Purchaser pursuant to this Agreement. Purchaser will
preserve and safe keep them as required by applicable law and sound banking
practice for the joint benefit of Seller and Purchaser. After the Closing Date,
Purchaser will permit Seller and its representatives, for reasonable cause (and
for no other purpose, it being acknowledged that competitive reasons shall not
be reasonable), at reasonable times and upon reasonable notice and at Seller's
expense, to examine, inspect, copy and reproduce any such files, documents or
records as Seller deems reasonably necessary.
Section 7.8 Fiduciary Relationships. Purchaser agrees to assume all of the
fiduciary relationships of Seller arising out of any XXX deposits assumed by
Purchaser pursuant to Section 2.4 hereof, to the same extent as if Purchaser had
originally acquired, incurred or entered into such fiduciary relationships.
Notwithstanding anything in this Agreement to the contrary, however, Purchaser
will not assume or be responsible for any act or failure to act of Seller in
connection with such XXX deposits prior to the Closing Date.
Section 7.9 Performance of Liabilities. Purchaser agrees to honor, to the
extent that such depositor has funds on deposit with Purchaser, all properly
payable checks, drafts, and non- negotiable withdrawal orders on forms
previously provided by Seller with respect to the Branch Deposits to the same
extent as if the checks, drafts, or orders were drawn on forms provided by
Purchaser with respect to similar deposits or accounts for a period of 120 days
following the Closing Date, and shall hold Seller harmless with respect to any
wrongful dishonor by Purchaser thereof within such period. Purchaser agrees to
honor all previously authorized ACH transfers with respect to the Branch
Deposits to the same extent as if the ACH transfer were made with respect to
similar deposits or accounts at Purchaser for a period of ninety (90) calendar
days following the Closing Date, and shall hold Seller harmless with respect to
any wrongful dishonor by Purchaser thereof within such period.
Section 7.10 Further Assurances of Purchaser. On and after the Closing
Date, Purchaser shall give such further assurances to Seller and upon Seller's
request shall execute, acknowledge and deliver all such acknowledgments and
other instruments and take such further action as may be necessary and
appropriate to effectively relieve and discharge Seller from any obligations
remaining under the Branch Deposits; provided, however, that Purchaser need not
incur any material costs or expenses in connection with the undertakings
contained in this sentence unless Seller agrees to bear such costs or expenses.
In particular, and without limiting the foregoing:
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(a) Purchaser will remit to Seller promptly after receipt by Purchaser
after the Closing Date at any of its offices all amounts intended
for deposit to accounts at Seller which were not transferred to
Purchaser pursuant to the Agreement; and
(b) With respect to checks or drafts drawn against accounts of Seller
which were not transferred to Purchaser pursuant to this Agreement,
Purchaser will cooperate with Seller and take all reasonable steps
requested by Seller to ensure that, on and after the Closing Date,
each such item which is coded for presentment to Purchaser or to any
bank for the account of Purchaser is delivered to Seller in a timely
manner and in accordance with applicable law and clearing house
rules or agreement.
Section 7.11 Further Assurances of Seller. On and after the Closing Date,
Seller shall (i) give such further assistance to Purchaser and shall execute,
acknowledge and deliver all such bills of sale, deeds, acknowledgments and other
instruments and take such further action as may be necessary and appropriate
effectively to vest in Purchaser full, legal and equitable title to the Assets,
and (ii) use its best efforts to assist Purchaser in the orderly transition of
the liabilities being acquired by Purchaser; provided, however, that Seller need
not incur any material costs or expenses in connection with the undertakings
contained in this sentence unless such costs or expenses are paid by Purchaser.
In particular, and without limiting the foregoing:
(a) Seller will remit to Purchaser promptly after receipt by Seller
after the Closing Date at any of its other offices all amounts
intended for deposit to the accounts which are part of the Branch
Deposits or otherwise relating to the Branch Deposits; and
(b) With respect to checks or drafts drawn against accounts which are
Branch Deposits, Seller will cooperate with Purchaser and take all
reasonable steps requested by Purchaser to ensure that, on and after
the Closing Date, each such item which is coded for presentment to
Seller or to any bank for the account of Seller is delivered to
Purchaser in a timely manner and in accordance with applicable law
and clearing house rules or agreement; and
(c) After Closing, Seller shall assist Purchaser for a period of 30 days
in any research reasonably requested by Purchaser with respect to
Branch Loans and Branch Deposits.
Section 7.12 Interest Reporting. Seller shall report from January 1, 2000
through the Closing Date all interest credited to, interest withheld from, and
early withdrawal penalties charged to the Branch Deposits which are assumed by
Purchaser under this Agreement. Purchaser shall report from the day after the
Closing Date through the end of the calendar year all interest credited to,
interest withheld from, and early withdrawal penalties charged to the Branch
Deposits assumed by Purchaser. Said reports shall be made to the holders of
these accounts and to the applicable Federal and State regulatory agencies.
Section 7.13 Training Sessions. All training sessions and other staff
meetings and other staff communications shall be coordinated with a designated
Seller representative prior to any such sessions, meetings or communications.
Section 7.14 Noncompetition of Seller. As a material inducement to
Purchaser to enter into the transactions contemplated herein, Seller hereby
agrees that for a period of three (3) years following the Closing Date, Seller
shall not own and/or operate a branch office and/or ATM location anywhere within
Saluda County, South Carolina. Seller's obligations under this Section shall
survive the Closing. Seller has carefully read and considered the provisions of
this
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Section and, having done so, agrees that the restrictions set forth in this
Section, including, but not limited to, the time period of restriction and
geographic limitations are fair and reasonable and are reasonably required for
the protection of the interests of Purchaser and its affiliates. In the event
that, notwithstanding the foregoing, any of the provisions of this Section or
any parts thereof shall be held to be invalid or unenforceable, the remaining
provisions or parts thereof shall nevertheless continue to be valid and
enforceable as though the invalid or unenforceable portions or parts had not
been included therein. In the event that any provision of this Section relating
to the time period and/or geographic restrictions and/or related aspects shall
be declared by a court of competent jurisdiction to exceed the maximum
restrictiveness such court deems reasonable and enforceable, the time period
and/or related aspects deemed reasonable and enforceable by the court shall
become and thereafter be the maximum restriction in such regard, and the
restriction shall remain enforceable to the fullest extent deemed reasonable by
such court. In the event of a breach or threatened breach by Seller of any of
the provisions of this Section, the Purchaser, in addition to and not in
limitation of, any other rights, remedies, or damages available to the Purchaser
under this Agreement, shall be entitled to a permanent injunction in order to
prevent or restrain any such breach by Seller or by Seller's partners, agents,
representatives, servants, shareholders, and/or any and all persons or entities
directly or indirectly acting for or with Seller. Seller covenants and agrees
that if it shall violate any of its covenants or agreements under this Section,
the Purchaser shall be entitled to: (i) an accounting and repayment of all
profits, compensation, commissions, remuneration, or other benefits that Seller
directly or indirectly has realized and/or may realize as a result of, growing
out of, or in connection with, any such violation; (ii) recover actual damages
incurred by Purchaser or its affiliates as a result of any such violation; (iii)
any injunctive relief to which Purchaser is or may be entitled at law, in
equity, or under this Agreement; and (iv) exercise its other rights respecting a
breach of this Agreement as set forth herein.
Article 8
Conditions to Seller's Obligations
The obligation of Seller to complete the transactions contemplated in this
Agreement are conditioned upon fulfillment (or waiver by Seller), on or before
the Closing Date, of each of the following conditions:
Section 8.1 Representations and Warranties True. The representations and
warranties made by Purchaser in this Agreement shall be true in all material
respects at and as of the Closing Date as though such representations and
warranties were made at and as of such time, except for any changes permitted by
the terms hereof or consented to by Seller.
Section 8.2 Obligations Performed. Purchaser shall (a) deliver to Seller
those items required by Section 4.5 hereof and (b) perform and comply in all
material respects with all obligations and agreements required by this Agreement
to be performed or complied with by it prior to or on the Closing Date.
Section 8.3 Regulatory Approval. The parties hereto shall have received
from the appropriate regulatory authorities approval of the transactions
contemplated herein and approval for Purchaser to operate the Branch Office and
ATM Site, and all notice and waiting periods required by law to pass shall have
passed and no proceeding to enjoin, restrain, prohibit or invalidate such
transactions shall have been instituted or threatened, and any conditions of any
regulatory approval shall have been met.
Section 8.4 No Adverse Litigation. On the Closing Date, no action, suit or
proceeding shall be pending or threatened against Purchaser which is reasonably
likely to materially and adversely affect the transaction contemplated herein.
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Article 9
Conditions to Purchaser's Obligations
The obligation of Purchaser to complete the transactions contemplated in
this Agreement are conditioned upon fulfillment (or waiver by Purchaser), on or
before the Closing Date, of each of the following conditions:
Section 9.1 Representations and Warranties True. The representations and
warranties made by Seller in this Agreement shall be true in all material
respects at and as of the Closing Date as though such representations and
warranties were made at and as of such time, except for any changes permitted by
the terms hereof or consented to by Purchaser.
Section 9.2 Obligations Performed. Seller shall (a) deliver to Purchaser
those items required by Section 4.4 hereof and (b) perform and comply in all
material respects with all obligations and agreements required by this Agreement
to be performed or complied with by it prior to or on the Closing Date.
Section 9.3 No Adverse Litigation or Change. On the Closing Date, no
action, suit or proceeding shall be pending or threatened against Seller which
is reasonably likely to (a) materially and adversely affect the Assets or the
Branch Deposits or (b) materially and adversely affect the transactions
contemplated herein. There shall have been no material adverse change in the
Assets, Branch Deposits or the operations of the Branch Office or ATM Site.
Section 9.4 Regulatory Approval. The parties hereto shall have received
from the appropriate regulatory authorities approval of the transactions
contemplated herein, and all notice and waiting periods required by law to pass
shall have passed and no proceeding to enjoin, restrain, prohibit or invalidate
such transactions shall have been instituted or threatened, and any conditions
of any regulatory approval shall have been met.
Article 10
Indemnification
Section 10.1 Indemnification of Purchaser. Seller agrees to indemnify and
hold Purchaser harmless from and against any claim, loss, liability, damage or
expense that Purchaser sustains or becomes subject to as a result of (a) the
operation by Seller of the Branch Office and/or ATM Site prior to the Effective
Time (except for the Assumed Liabilities), including but not limited to any and
all current and long-term liabilities, contingent liabilities, environmental
claims, workers' compensation claims, and sales and payroll taxes, (b) the
breach or nonfulfillment by Seller of any warranty, representation or covenant
of Seller set forth herein, and (c) any claim against, or liability or
obligation of, Seller which (i) is asserted against or sustained by Purchaser,
its agents or employees and (ii) has not been expressly assumed by Purchaser
pursuant to this Agreement. Any such indemnification shall include any costs,
including reasonable attorneys' fees incurred by Purchaser, whether or not suit
is brought, subject to Section 10.3. Further, subject to Section 10.3, in the
event Seller breaches any warranty or representation made in this Agreement or
fails to perform any requirement or obligation undertaken in this Agreement,
Seller agrees to pay all costs, including attorneys' fees (including at the
appellate level), incurred by Purchaser in the enforcement hereof, whether or
not suit is brought. Any such demands or claims arising out of breach of
warranties, covenants, or indemnities must be made prior to the expiration of
the Warranty Period.
Section 10.2 Indemnification of Seller. Purchaser agrees to indemnify and
hold Seller harmless from and against any claim, loss, liability, damage or
expense that Seller sustains or becomes subject to as a result of (a) the
operation by Purchaser of the Branch Office and ATM Site from and after the
Effective Time, including but not limited to any and all current and long-
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term liabilities, contingent liabilities, environmental claims, workers'
compensation claims, and sales and payroll taxes, (b) as a result of the breach
or nonfulfillment by Purchaser of any warranty, representation or covenant of
such parties set forth herein, and (c) any claim against, or liability or
obligation of, Seller which (i) is asserted against or sustained by Seller, its
agents or employees and (ii) has been assumed by Purchaser pursuant to this
Agreement. Any such indemnification shall include any costs, including
attorneys' fees incurred by Seller, whether or not suit is brought, subject to
Section 10.3. Further, subject to Section 10.3, in the event Purchaser breaches
any warranty or representation made in this Agreement or fails to perform any
requirement or obligation undertaken in this Agreement, Purchaser agrees to pay
all costs, including reasonable attorneys' fees (including at the appellate
level), incurred by Seller in the enforcement hereof, whether or not suit is
brought. Any such demands or claims arising out of breach of warranties,
covenants, or indemnities must be made prior to the expiration of the Warranty
Period.
Section 10.3 Defense and Settlement. A party seeking indemnification
pursuant to this Article 10 (an "indemnified party") shall give prompt notice to
the party from whom such indemnification is sought (the "indemnifying party") of
the assertion of any claim, or the commencement of any action or proceeding, in
respect of which indemnity may be sought hereunder. The indemnified party shall
assist the indemnifying party in the defense of any such action or proceeding.
The indemnifying party shall have the right to, and shall at the request of the
indemnified party, assume the defense of any such action or proceeding at its
own expense. 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:
(a) The indemnifying party and the indemnified party shall have mutually
agreed to the retention of such counsel; or
(b) 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 both parties by the same counsel would be
inappropriate due to actual or potential differing interests between
them.
An indemnifying party shall not be liable under this Section 10.3 for any
settlement effected without its consent of any claim, litigation or proceeding
in respect of which indemnity may be sought hereunder. The indemnifying party
may settle any claim without the consent of the indemnified party, but only if
the sole relief awarded is monetary damages that are paid in full by the
indemnifying party. An indemnified party shall, subject to its reasonable
business needs, use reasonable efforts to minimize the indemnification sought
from the indemnifying party hereunder. Notwithstanding the foregoing, no
investigation by an indemnified party at or prior to the Closing shall relieve
an indemnifying party of any liability hereunder, unless the indemnified party
seeks indemnity in respect of a representation or warranty which it actually had
reason to believe to be incorrect as a result of its investigation prior to the
Closing and the indemnified party intentionally failed to bring such belief to
the attention of the indemnifying party prior to the Closing.
Section 10.4 Limitations on Indemnification. Notwithstanding anything to
the contrary contained in this Article 10, no indemnification shall be required
to be made by either party until the aggregate amount of all such claims by a
party, exceeds an aggregate of $20,000. Once such aggregate amounts exceed
$20,000, such party (or parties, in the case of a party's affiliate) shall
thereupon be entitled to indemnification for all amounts, including the initial
$20,000.
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Article 11
Personnel
Section 11.1 Responsibilities of Purchaser. Seller shall make available
for employment by Buyer all of Seller's employees working at the Branch Office
at any period between the date of this Agreement and the Effective Date, but
Purchaser shall not be obligated to employ any particular employee. Schedule
11.1 attached hereto and updated to the Closing Date sets forth a true, correct
and complete list showing all such employees, their respective dates of hire and
salary levels. Seller shall remain liable for any salaries, wages, employee
benefits, bonuses, or commissions earned or accrued by all such Branch personnel
before the Closing Date.
Section 11.2 [reserved]
Section 11.3 Representations with Respect to Employees. Seller represents
and warrants to Purchaser that Seller is not a party to any employee contracts
or compensation arrangements with respect to its employees working at the
Branch, and Seller will indemnify Purchaser with respect to any and all
liabilities arising under any such contract or arrangement. During the period of
time from the date hereof through the Closing Date, Seller agrees not to
increase the number of employees, employee compensation or employee benefits,
other than employee compensation increases which would have otherwise occurred
in the ordinary course of business. Seller's employees are not represented by a
labor union nor are they parties to a collective bargaining agreement. No
request for such representation is pending.
Article 12
Miscellaneous
Section 12.1 Notices. Any notice, request, approval, consent, demand or
other communication shall be effective upon the first to occur of the following:
(i) upon receipt by the party to whom such notice, request, approval, consent,
demand or other communication is being given; or (ii) three (3) business days
after being duly deposited in the United States mail, registered or certified,
return receipt requested, and addressed as follows:
(a) If to Seller, to: The Anchor Bank
0000 Xxx Xxxxxx
Xxxxxx Xxxxx, XX 00000
Attn: Xxxxx X. Xxxxxx
with a copy to: Xxx Xxxxxxx, Esquire
Xxxxxxx & XxXxxxxx
000 Xxxxxxxx Xxxx, Xxxxx 000
Xxxxxxx, XX 00000
(b) If to Purchaser, to: Mid State Bank
c/o Community Capital Corporation
000 Xxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000
Attn: Xxxxxxx X. Xxxxxxx
with a copy to: Nexsen, Pruet, Xxxxxx & Xxxxxxx
X.X. Xxxxxx 0000
Xxxxxxxx, Xxxxx Xxxxxxxx 00000
Attn: Xxxxxx Xxxxxx III
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The parties hereto may change their respective addresses by notice in
writing given to the other party to this Agreement.
Section 12.2 Conditions for Termination. In addition to the provisions for
termination as provided elsewhere in this Agreement, this Agreement shall
terminate and be of no further force or effect as between the parties, except as
to liability for breach of any duty or obligation arising prior to the date of
termination, upon the occurrence of any of the following:
(a) The expiration of thirty (30) calendar days after any governmental
agency shall have denied or refused to grant the approvals or
consents required to be obtained pursuant to this Agreement, unless
within said thirty (30) day period Purchaser and Seller agree to
submit or resubmit an application to, or appeal the decision of, the
regulatory authority which denied or refused to grant approval
thereof;
(b) The expiration of thirty (30) Business Days from the date that
either party has given notice to the other party of such other
party's material breach of any covenant or failure to fulfill any
condition to such party's performance under this Agreement;
provided, however, that no such termination shall take effect if
within said thirty (30) day period the party so notified shall have
fully and completely corrected the grounds for termination as
specified in such notice;
(c) Upon the failure to consummate the transaction on or before July 7,
2000, unless such date is extended in writing agreed to by both
parties; and
(d) Upon mutual consent of the parties to terminate.
Notwithstanding anything to the contrary contained in this Agreement, no
party hereto shall have the right to terminate this Agreement on account of its
own breach, a breach by its affiliate, or any immaterial breach by another
party.
Section 12.3 Effect of Termination. No termination of this Agreement
pursuant to this Article 12 or for any reason or in any manner shall release, or
be construed to release, either party hereto from liability or damage to the
other party arising out of, in connection with, or otherwise relating to,
directly or indirectly, such party's breach, default or failure in performance
of any material covenants, agreements, duties or obligations arising hereunder.
Section 12.4 Rights Upon Default. The parties hereto each acknowledge that
the rights of the other to consummate the transactions contemplated by this
Agreement are special, unique and of extraordinary character, and that, in the
event that any party violates or fails or refuses to perform any covenant or
agreement made in this Agreement, then the other party may be without adequate
remedy at law. The parties each agree, therefore, that in the event that any of
them violates or fails or refuses to perform any covenant or agreement made in
this Agreement, any other party may, in addition to any remedies at law for
damages or other relief, institute and prosecute an action in any court of
competent jurisdiction to enforce specific performance of such covenant or
agreement or seek any other equitable relief.
Section 12.5 Successors and Assigns. This Agreement shall be binding upon
and inure to the benefit of the undersigned parties and their respective
successors and permitted assigns (and to or for the benefit of no other person
or entity whatsoever). Except for such assignments as may be necessary to effect
the transactions through wholly-owned subsidiaries of the parties hereto and for
the transfer of any or all of Purchaser's rights hereunder to its parent
corporation, no assignment of this Agreement shall be made by the parties prior
to the Closing without the prior written consent of all parties.
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Section 12.6 Governing Law. Except as required by federal law, this
Agreement shall be controlled, construed and enforced in accordance with the
laws of South Carolina.
Section 12.7 Announcements. The parties agree that the terms and
conditions of the transactions contemplated in this Agreement are to remain
confidential, except and only to the extent that applicable law requires
disclosure (and then notice of such disclosure shall be given to the other). Any
announcement or notice to third parties or to the public concerning the
transactions contemplated by this Agreement shall be jointly planned and
coordinated between the parties hereto.
Section 12.8 Confidentiality. The parties agree that all information
provided to the other parties hereunder (other than information which is a
matter of public knowledge or which has heretofore been published in any
publication for public distribution or filed as public information with any
governmental authority) is confidential and shall be used by the other parties
only for the purposes hereof. Should this Agreement be terminated for any
reason, each party shall return all such information, including all copies, to
the other party or parties.
Section 12.9 Integration. This Agreement and other agreements, documents,
and instruments to be delivered pursuant hereto supersedes all prior
negotiations, agreements and understandings between the parties and shall
constitute the entire agreement of the parties with respect to the subject
matter hereof, and may not be altered or amended except in a writing signed by
the parties.
Section 12.10 Waiver. The failure of any party at any time or times to
require performance of any provision hereof shall in no manner affect the right
to enforce the same; and no waiver by a party of any provision (or breach of a
provision) hereof, whether by conduct or otherwise, in any one or more instances
shall be denied or construed either as a further or continuing waiver of any
such provision or breach or as a waiver of any other provision or breach hereof.
Section 12.11 Headings. The headings of the Sections and Articles of this
Agreement are inserted for convenience only and shall not constitute a part
hereof.
Section 12.12 Expenses. Except as otherwise provided in this Agreement,
all legal, accounting and other costs and expenses incurred in connection with
the execution, delivery and performance of this Agreement and the transactions
contemplated hereby shall be borne and paid by the party incurring such costs
and expenses, and neither party shall be obligated for any cost or expense
incurred by the other party.
Section 12.13 Severability. In the event that any court of competent
jurisdiction shall determine that any provision of this Agreement is invalid,
such determination shall not affect the validity of the other provisions of this
Agreement, which shall remain in full force and effect and which shall be
construed as to be valid under applicable law.
Section 12.14 Time of the Essence. Due to the sensitive nature of this
transaction, it understood and agreed that time is of the essence of this
Agreement.
Section 12.15 No Inference Against Author. No provision of this Agreement
shall be interpreted against any party because such party or its legal
representative drafted such provision.
Section 12.16 Counterparts. This Agreement may be executed simultaneously
in several counterparts, each of which shall be deemed an original but which
together shall constitute one and the same original.
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IN WITNESS WHEREOF, the parties have duly executed this Purchase and
Assumption Agreement as of the day first above written.
THE ANCHOR BANK
/S/ XXXXX X. XXXXXXX By: /S/ XXXXX X. XXXXXX
--------------------- --------------------
Witness Xxxxx X. Xxxxxx
Its: Executive Vice President
& Chief Financial Officer
MID STATE BANK
/S/ XXXXX X. XXXXXXX By: /S/ XXXXXXX X. XXXXXXXX
--------------------- ------------------------
Witness Xxxxxxx X. Xxxxxxxx
Its: President
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List of Exhibits
Exhibit A - Assignment and Assumption of Lease Agreement
Exhibit B - Xxxx of Sale
Exhibit C - Assignment and Assumption Agreement
Schedule 2.1(b) - Branch Property
Schedule 2.1(e) - Branch Loans
Schedule 2.1(f) - Safe Deposit Leases
Schedule 2.1(g) - Equipment Leases
Schedule 2.1(h) - Repurchase Agreements
Schedule 2.2(d) - Excluded Assets
Schedule 2.3(a) - Additional Obligations Related to Branch Deposits
Schedule 2.3(c) - Additional Liabilities
Schedule 2.4(a) - Excluded Deposits
Schedule 7.4(b) - Contracts
Schedule 11.1 - Employees
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