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Exhibit 2.1
AGREEMENT AND PLAN OF MERGER
by and between
OLD KENT FINANCIAL CORPORATION
and
FIFTH THIRD BANCORP
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DATED AS OF NOVEMBER 20, 2000
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TABLE OF CONTENTS
ARTICLE I
THE MERGER
1.1. The Merger......................................................................... 2
1.2 Effective Time..................................................................... 2
1.3 Effects of the Merger.............................................................. 2
1.4 Conversion of Old Kent Common Stock................................................ 2
1.5 Fifth Third Capital Stock.......................................................... 4
1.6 Options............................................................................ 4
1.7 Articles of Incorporation of Fifth Third........................................... 5
1.8 By-Laws of Fifth Third............................................................. 5
1.9 Tax and Accounting Consequences.................................................... 5
ARTICLE II
EXCHANGE OF SHARES
2.1 Fifth Third to Make Shares Available............................................... 6
2.2 Exchange of Shares................................................................. 6
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF OLD KENT
3.1 Corporate Organization............................................................. 8
3.2 Capitalization..................................................................... 9
3.3 Authority; No Violation............................................................ 10
3.4 Consents and Approvals............................................................. 11
3.5 Reports............................................................................ 12
3.6 Financial Statements............................................................... 13
3.7 Broker's Fees...................................................................... 13
3.8 Absence of Certain Changes or Events............................................... 13
3.9 Legal Proceedings.................................................................. 14
3.10 Taxes and Tax Returns.............................................................. 14
3.11 Employees.......................................................................... 15
3.12 SEC Reports........................................................................ 17
3.13 Compliance with Applicable Law..................................................... 18
3.14 Certain Contracts.................................................................. 18
3.15 Agreements with Regulatory Agencies................................................ 19
3.16 Interest Rate Risk Management Instruments.......................................... 19
3.17 Undisclosed Liabilities............................................................ 20
3.18 Environmental Liability............................................................ 20
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3.19 Intellectual Property.............................................................. 20
3.20 State Takeover Laws; Old Kent Rights Agreement..................................... 21
3.21 Reorganization; Pooling of Interests............................................... 21
3.22 Opinions........................................................................... 21
3.23 Old Kent Information............................................................... 21
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF FIFTH THIRD
4.1 Corporate Organization............................................................. 22
4.2 Capitalization..................................................................... 23
4.3 Authority, No Violation............................................................ 23
4.4 Consents and Approvals............................................................. 24
4.5 Reports............................................................................ 25
4.6 Financial Statements............................................................... 25
4.7 Broker's Fees...................................................................... 26
4.8 Absence of Certain Changes or Events............................................... 26
4.9 Legal Proceedings.................................................................. 26
4.10 Taxes and Tax Returns.............................................................. 27
4.11 SEC Reports........................................................................ 27
4.12 Compliance with Applicable Law..................................................... 28
4.13 Agreements with Regulatory Agencies................................................ 28
4.14 Interest Rate Risk Management Instruments.......................................... 28
4.15 Undisclosed Liabilities............................................................ 29
4.16 Environmental Liability............................................................ 29
4.16 Reorganization; Pooling of Interests............................................... 29
4.17 Fifth Third Information............................................................ 29
ARTICLE V
COVENANTS RELATING TO CONDUCT OF BUSINESS
5.1 Conduct of Businesses Prior to the Effective Time.................................. 30
5.2 Forbearances....................................................................... 30
5.3 Fifth Third Forbearances........................................................... 34
ARTICLE VI
ADDITIONAL AGREEMENTS
6.1 Regulatory Matters................................................................. 34
6.2 Access to Information.............................................................. 35
6.3 Old Kent Stockholder Approvals..................................................... 36
6.4 Legal Conditions to Merger......................................................... 36
6.5 Affiliates; Publication of Combined Financial Results.............................. 36
6.6 Stock Exchange Listing............................................................. 37
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6.7 Employee Benefit Plans............................................................. 37
6.8 Indemnification; Directors' and Officers' Insurance................................ 38
6.9 Additional Agreements.............................................................. 39
6.10 Advice of Changes.................................................................. 39
6.11 Dividends.......................................................................... 39
6.12 Exemption from Liability Under Section 16(b)....................................... 39
6.13 Directorships...................................................................... 40
6.14 Aggregate Capitalization........................................................... 40
6.15 Community Commitments.............................................................. 40
ARTICLE VII
CONDITIONS PRECEDENT
7.1 Conditions to Each Party's Obligation To Effect the Merger......................... 40
7.2 Conditions to Obligations of Fifth Third........................................... 41
7.3 Conditions to Obligations of Old Kent.............................................. 42
ARTICLE VIII
TERMINATION AND AMENDMENT
8.1 Termination........................................................................ 42
8.2 Effect of Termination.............................................................. 43
8.3 Amendment.......................................................................... 44
8.4 Extension; Waiver.................................................................. 44
ARTICLE IX
GENERAL PROVISIONS
9.1 Closing............................................................................ 44
9.2 Nonsurvival of Representations, Warranties and Agreements.......................... 44
9.3 Expenses........................................................................... 44
9.4 Notices............................................................................ 45
9.5 Interpretation..................................................................... 45
9.6 Counterparts....................................................................... 46
9.7 Entire Agreement................................................................... 46
9.8 Governing Law...................................................................... 46
9.9 Publicity.......................................................................... 46
9.10 Assignment; Third Party Beneficiaries.............................................. 46
Exhibit A - Old Kent Option Agreement
Exhibit 6.5(a)(1) - Form of Affiliate Letter Addressed to Old Kent
Exhibit 6.5(a)(2) - Form of Affiliate Letter Addressed to Fifth Third
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INDEX OF DEFINED TERMS
Page No.
--------
Agreement................................................................................ 1
Benefit Plan............................................................................. 15
BHC Act.................................................................................. 8
Certificate.............................................................................. 3
Certificates of Merger................................................................... 2
Closing.................................................................................. 43
Closing Date............................................................................. 43
Code..................................................................................... 1
Covered Employees........................................................................ 36
DPC Shares............................................................................... 3
Effective Time........................................................................... 2
ERISA.................................................................................... 15
Exchange Act............................................................................. 12
Exchange Agent........................................................................... 5
Exchange Fund............................................................................ 5
Exchange Ratio........................................................................... 3
Federal Reserve Board.................................................................... 11
FHC...................................................................................... 8
Fifth Third.............................................................................. 1
Fifth Third Articles..................................................................... 21
Fifth Third Bank Subsidiaries............................................................ 29
Fifth Third Capital Stock................................................................ 4
Fifth Third Charter Amendment............................................................ 00
Xxxxx Xxxxx Xxxxxx Stock................................................................. 3
Fifth Third Disclosure Schedule.......................................................... 21
Fifth Third New Preferred Stock.......................................................... 4
Fifth Third Preferred Stock.............................................................. 4
Fifth Third Regulatory Agreement......................................................... 27
Fifth Third Reports...................................................................... 26
Fifth Third Stock Plans.................................................................. 22
Fifth Third Stockholder Rights........................................................... 3
Fifth Third Subsidiary................................................................... 9
Fifth Third 1999 Financial Information................................................... 24
Fifth Third 1999 10-k.................................................................... 25
GAAP..................................................................................... 5
HSR Act.................................................................................. 11
Indemnified Parties...................................................................... 37
Injunction............................................................................... 39
Insurance Amount......................................................................... 38
Intellectual Property.................................................................... 20
IRS...................................................................................... 14
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Liens.................................................................................... 9
Material Adverse Effect.................................................................. 8
MBCA..................................................................................... 2
Merger................................................................................... 1
Merger Consideration..................................................................... 2
Michigan Certificate of Merger........................................................... 2
NASDAQ................................................................................... 7
OCC...................................................................................... 11
OGCL..................................................................................... 2
Ohio Certificate of Merger............................................................... 2
Old Kent................................................................................. 1
Old Kent Articles........................................................................ 8
Old Kent Bank Subsidiaries............................................................... 21
Old Kent Benefit Plans................................................................... 15
Old Kent Bylaws.......................................................................... 0
Xxx Xxxx Xxxxxxx Xxxxx................................................................... 0
Xxx Xxxx Xxxxxx Stock.................................................................... 0
Xxx Xxxx Xxxxxxxx........................................................................ 00
Xxx Xxxx Disclosure Schedule............................................................. 8
Old Kent DRIP............................................................................ 9
Old Kent ERISA Affiliate................................................................. 00
Xxx Xxxx Xxxxxxxx........................................................................ 00
Xxx Xxxx Option Agreement................................................................ 1
Old Kent Perpetual Preferred Stock....................................................... 3
Old Kent Preferred Stock................................................................. 9
Old Kent Regulatory Agreement............................................................ 18
Old Kent Reports......................................................................... 00
Xxx Xxxx Xxxxxx.......................................................................... 0
Xxx Xxxx Rights Agreement................................................................ 2
Old Xxxx Xxxxx Plans..................................................................... 4
Old Kent Stockholder Rights.............................................................. 2
Old Kent Subsidiary...................................................................... 9
Old Kent 1999 10-K....................................................................... 12
Joint Proxy Statement.................................................................... 11
Predecessor Plan......................................................................... 15
Regulatory Agencies...................................................................... 11
Requisite Regulatory Approvals........................................................... 40
SBA...................................................................................... 11
SEC...................................................................................... 11
Section 16 Information................................................................... 38
Securities Act........................................................................... 16
SRO...................................................................................... 11
State Approvals.......................................................................... 11
Subsidiary............................................................................... 8
Surviving Corporation.................................................................... 1
S-4...................................................................................... 11
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Takeover Statutes........................................................................ 20
Tax(es).................................................................................. 14
Trust Account Shares..................................................................... 3
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AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER, dated as of November 20, 2000
(including all schedules and exhibits attached hereto, this "Agreement"), by and
between OLD KENT FINANCIAL CORPORATION, a Michigan corporation ("Old Kent"), and
FIFTH THIRD BANCORP, an Ohio corporation ("Fifth Third").
W I T N E S S E T H:
WHEREAS, the Boards of Directors of Old Kent and Fifth Third
have determined that it is in the best interests of their respective companies
and their stockholders to consummate the strategic business combination
transaction provided for herein in which Old Kent will, subject to the terms and
conditions set forth herein, merge with and into Fifth Third (the "Merger"), so
that Fifth Third is the surviving corporation in the Merger (sometimes referred
to in such capacity as the "Surviving Corporation"); and
WHEREAS, as a condition to the execution of this Agreement,
and simultaneously with the execution hereof, Old Kent and Fifth Third are
entering into a stock option agreement (the "Old Kent Option Agreement") in the
form attached hereto as Exhibit A; and
WHEREAS, for Federal Income Tax purposes, it is intended that
the Merger shall qualify as a reorganization under the provisions of Section 368
of the Internal Revenue Code of 1986, as amended (the "Code"), and this
Agreement is intended to be and is adopted as a plan of reorganization for
purposes of Sections 354, 361 and 368 of the Code; and
WHEREAS, the parties desire to make certain representations,
warranties and agreements in connection with the Merger and also to prescribe
certain conditions to the Merger.
NOW, THEREFORE, in consideration of the mutual covenants,
representations, warranties and agreements contained herein, and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, and intending to be legally bound hereby, the parties agree as
follows:
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ARTICLE I
THE MERGER
1.1 The Merger. (a) Subject to the terms and conditions of
this Agreement, in accordance with the Michigan Business Corporation Act (the
"MBCA") and the Ohio General Corporation Law (the "OGCL"), at the Effective
Time, Old Kent shall merge with and into Fifth Third. Fifth Third shall be the
Surviving Corporation in the Merger, and shall continue its corporate existence
under the laws of the State of Ohio.
(b) Fifth Third may at any time change the method of effecting
the combination with Old Kent (including by providing for the merger of a wholly
owned subsidiary of Fifth Third with and into Old Kent) if and to the extent
Fifth Third deems such change to be desirable; provided, however, that no such
change shall (i) alter or change the amount or kind of consideration to be
issued to holders of the Old Kent Common Stock as provided for in this Agreement
(the "Merger Consideration"), (ii) adversely affect the Tax treatment of the
holders of Old Kent Common Stock as a result of receiving the Merger
Consideration or (iii) materially impede or delay consummation of the
transactions contemplated by this Agreement. Old Kent shall, if requested by
Fifth Third, enter into one or more amendments to this Agreement prior to the
Effective Time in order to effect any such change.
1.2 Effective Time. The Merger shall become effective as set
forth in the certificate of merger (the "Ohio Certificate of Merger") that shall
be filed with the Secretary of State of the State of Ohio and the certificate of
merger (the "Michigan Certificate of Merger") that shall be filed with the
appropriate office of the State of Michigan on the Closing Date (together with
the Ohio Certificate of Merger, the "Certificates of Merger"). The term
"Effective Time" shall be the date and time when the Merger becomes effective as
set forth in the Certificates of Merger which shall not be later than the
Closing Date.
1.3 Effects of the Merger. At and after the Effective Time,
the Merger shall have the effects set forth in Section 1701.82 of the OGCL and
Section 724 of the MBCA.
1.4 Conversion of Old Kent Capital Stock. At the Effective
Time, by virtue of the Merger and without any action on the part of Fifth Third,
Old Kent or the holder of any of the following securities:
(a) Subject to Section 2.2(e), each share of the common stock
(the "Old Kent Common Stock"), par value $1.00 per share, of Old Kent issued and
outstanding immediately prior to the Effective Time (together with the preferred
stock purchase rights ("Old Kent Stockholder Rights") attached thereto issued
pursuant to that certain Rights Agreement, between Old Kent and Old Kent Bank
dated as of January 20, 1997, as amended as of December 30, 1998 (the "Old Kent
Rights Agreement"), except for shares of Old Kent Common Stock owned by Old Kent
as treasury stock or owned,
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directly or indirectly, by Old Kent or Fifth Third (other than shares of Old
Kent Common Stock held, directly or indirectly, in trust accounts, managed
accounts and the like, or otherwise held in a fiduciary capacity, that are
beneficially owned by third parties (any such shares of Old Kent Common Stock
which are similarly held, whether held directly or indirectly by Old Kent or
Fifth Third, as the case may be, being referred to herein as "Trust Account
Shares") and other than any shares of Old Kent Common Stock held by Old Kent or
Fifth Third in respect of a debt previously contracted (any such shares of Old
Kent Common Stock which are similarly held, whether held directly or indirectly
by Old Kent or Fifth Third, being referred to herein as "DPC Shares")), shall be
converted into the right to receive 0.74 of a share (the "Exchange Ratio") of
the common stock, without par value, of Fifth Third (the "Fifth Third Common
Stock").
(b) All of the shares of Old Kent Common Stock converted into
the right to receive Fifth Third Common Stock pursuant to this Article I shall
no longer be outstanding and shall automatically be cancelled and shall cease to
exist as of the Effective Time, and each certificate previously representing any
such shares of Old Kent Common Stock (each a "Certificate") shall thereafter
represent only the right to receive (i) a certificate representing the number of
whole shares of Fifth Third Common Stock and (ii) cash in lieu of fractional
shares into which the shares of Old Kent Common Stock represented by such
Certificate have been converted pursuant to this Section 1.4 and Section 2.2(e).
Certificates previously representing shares of Old Kent Common Stock shall be
exchanged for certificates representing whole shares of Fifth Third Common Stock
and cash in lieu of fractional shares issued in consideration therefor upon the
surrender of such Certificates in accordance with Section 2.2, without any
interest thereon. If, prior to the Effective Time, the outstanding shares of
Fifth Third Common Stock or Old Kent Common Stock shall have been increased,
decreased, changed into or exchanged for a different number or kind of shares or
securities as a result of a reorganization, recapitalization, reclassification,
stock dividend, stock split, reverse stock split, or other similar change in
capitalization, an appropriate and proportionate adjustment shall be made to the
Exchange Ratio.
(c) Notwithstanding anything in the Agreement to the contrary,
at the Effective Time, all shares of Old Kent Common Stock that are owned,
directly or indirectly, by Old Kent or Fifth Third (other than Trust Account
Shares and DPC Shares) shall be cancelled and shall cease to exist and no stock
of Fifth Third or other consideration shall be delivered in exchange therefor.
(d) Each share of Old Kent Series D Perpetual Preferred Stock,
issued and outstanding immediately prior to the Effective Time shall be
converted, automatically and without the requirement of any exchange of any
certificate representing such stock, into one share of perpetual preferred stock
of Fifth Third designated as Fifth Third Series D Perpetual Preferred Stock. The
terms of the Fifth Third Series D Perpetual Preferred Stock shall be
substantially identical to the terms of the Old Kent Series D Perpetual
Preferred Stock, except for such changes as may be required to give effect to
the adjustment required by Section D.5.3.E. of the certificate of designations,
preferences and rights relating thereto in respect of the Merger.
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(e) Each share of Old Kent Series E Perpetual Preferred Stock
(together with the Old Kent Series D Perpetual Preferred Stock, the "Old Kent
Perpetual Preferred Stock"), issued and outstanding immediately prior to the
Effective Time shall be converted, automatically and without the requirement of
any exchange of any certificate representing such stock, into one share of
perpetual preferred stock of Fifth Third designated as Fifth Third Series E
Perpetual Preferred Stock (together with the Fifth Third Series D Perpetual
Preferred Stock, the "Fifth Third New Preferred Stock"). The terms of the Fifth
Third Series E Perpetual Preferred Stock shall be substantially identical to the
terms of the Old Kent Series E Perpetual Preferred Stock.
(f) All of the shares of Old Kent Perpetual Preferred Stock
converted into Fifth Third New Preferred Stock pursuant to this Article I shall
no longer be outstanding and shall automatically be cancelled and shall cease to
exist as of the Effective Time, and each certificate previously representing any
such shares of Old Kent Perpetual Preferred Stock shall as of the Effective Time
be deemed to represent as of the Effective Time the number of shares of
corresponding Fifth Third New Preferred Stock into which the shares of Old Kent
Perpetual Preferred Stock represented by such preferred stock certificate have
been converted pursuant to this Section 1.4.
1.5 Fifth Third Capital Stock. At and after the Effective
Time, each share of Fifth Third Common Stock and each share of preferred stock,
without par value, of Fifth Third (the "Fifth Third Preferred Stock," and
together with the Fifth Third Common Stock, the "Fifth Third Capital Stock")
issued and outstanding immediately prior to the Effective Time shall remain
issued and outstanding and shall not be affected by the Merger.
1.6 Options. (a) At the Effective Time, each option granted by
Old Kent to purchase shares of Old Kent Common Stock which is outstanding and
unexercised immediately prior thereto shall cease to represent a right to
acquire shares of Old Kent Common Stock and shall be converted automatically
into an option to purchase shares of Fifth Third Common Stock in an amount and
at an exercise price determined as provided below (and otherwise subject to the
terms of, as the case may be, the Old Kent Executive Stock Option Plan of 1986,
the Old Kent Restricted Stock Plan of 1987, the Old Xxxx Xxxxx Option Incentive
Plan of 1992, the Old Kent Deferred Stock Compensation Plan, the Old Kent
Executive Stock Incentive Plan of 1999, Stock Option Plan for Non-Employee
Director Optionholders of First National Bank Corp., Incentive Stock Option Plan
for Employee Optionholders of First National Bank Corp., Old Kent Financial
Corporation Executive Stock Incentive Plan of 1997, Employee Recognition Award
Plan, Stock Incentive Plan of 1999, Stock Option Plan for Holders of Unexercised
Options Under the CFSB Bancorp, Inc. 1994 Stock Option and Incentive Plan and
the CFSB Bancorp, Inc. 1990 Stock Option Plan, Stock Option Plan for Option
holders of Pinnacle Banc Group, Inc., Stock Option Plan for Option holders of
Merchants Bancorp, Inc., Stock Option Plan for Option holders of Grand Premier
Financial, Inc., Stock Option Plan for Option holders of Home Bancorp, Executive
Stock Option Plan of 1986, Deferred Stock Incentive Plan for Employees of Guyot,
Hicks, Xxxxxxxx & Associates, Inc., the Old Kent Bank Employee Preferred
Interest Bonus Plan (GNB Realty REIT)
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and the Directors' Deferred Compensation Plan in each case as amended through
the date hereof (collectively, the "Old Xxxx Xxxxx Plans"), and the agreements
evidencing grants thereunder):
(i) The number of shares of Fifth Third Common Stock to be
subject to the new option shall be equal to the product of the number of shares
of Old Kent Common Stock subject to the original option and the Exchange Ratio,
provided that any fractional shares of Fifth Third Common Stock resulting from
such multiplication shall be rounded to the nearest whole share; and
(ii) The exercise price per share of Fifth Third Common Stock
under the new option shall be equal to the exercise price per share of Old Kent
Common Stock under the original option divided by the Exchange Ratio, provided
that such exercise price shall be rounded to the nearest whole cent.
(b) The adjustment provided herein with respect to any options
which are "incentive stock options" (as defined in Section 422 of the Code)
shall be and is intended to be effected in a manner which is consistent with
Section 424(a) of the Code. The duration and other terms of the new option shall
be the same as the original option except that all references to Old Kent shall
be deemed to be references to Fifth Third.
(c) Fifth Third shall take all corporate action necessary to
reserve for issuance a sufficient number of shares of Fifth Third Common Stock
for delivery upon exercise of Old Xxxx Xxxxx Options, as adjusted in accordance
with this Section 1.6. As soon as practicable after the Effective Time, Fifth
Third shall file a registration statement on Form S-8 (or any successor or other
appropriate forms), with respect to the shares of Fifth Third Common Stock
subject to such options and shall use its reasonable best efforts to maintain
the effectiveness of such registration statement or registration statements (and
maintain the current status of the prospectus or prospectuses contained therein)
for so long as such options remain outstanding.
1.7 Articles of Incorporation of Fifth Third. At the Effective
Time, the Fifth Third Articles shall be the articles of incorporation of the
Surviving Corporation until thereafter amended in accordance with applicable
law.
1.8 Code of Regulations of Fifth Third. At the Effective Time,
the Fifth Third Code of Regulations shall be the Code of Regulations of the
Surviving Corporation until thereafter amended in accordance with applicable
law.
1.9 Tax and Accounting Consequences. It is intended that the
Merger shall constitute a "reorganization" within the meaning of Section 368(a)
of the Code, that this Agreement shall constitute a "plan of reorganization" for
the purposes of Sections 354, 361 and 368 of the Code and that the Merger shall
be accounted for as a "pooling of interests" under generally accepted accounting
principles ("GAAP").
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ARTICLE II
EXCHANGE OF SHARES
2.1 Fifth Third to Make Shares Available. At or prior to the
Effective Time, Fifth Third shall deposit, or shall cause to be deposited, with
a bank or trust company Subsidiary of Fifth Third, or another bank or trust
company reasonably acceptable to each of Old Kent and Fifth Third (the "Exchange
Agent"), for the benefit of the holders of Certificates, for exchange in
accordance with this Article II, certificates representing the shares of Fifth
Third Common Stock, and cash in lieu of any fractional shares (such cash and
certificates for shares of Fifth Third Common Stock, together with any dividends
or distributions with respect thereto, being hereinafter referred to as the
"Exchange Fund"), to be issued pursuant to Section 1.4 and paid pursuant to
Section 2.2(a) in exchange for outstanding shares of Old Kent Common Stock.
2.2 Exchange of Shares. (a) As soon as practicable after the
Effective Time, but in no event more than 10 days after the later of the Closing
Date or the date the Exchange Agent shall have received from Old Kent a
substantially complete list of the final shareholders of Old Kent as of the
Effective Time, the Exchange Agent shall mail to each holder of record of one or
more Certificates a letter of transmittal in customary form as reasonably agreed
to by the parties (which shall specify, among other things, that delivery shall
be effected, and risk of loss and title to the Certificates shall pass, only
upon delivery of the Certificates to the Exchange Agent) and instructions for
use in effecting the surrender of the Certificates in exchange for certificates
representing the shares of Fifth Third Common Stock and any cash in lieu of
fractional shares into which the shares of Old Kent Common Stock represented by
such Certificate or Certificates shall have been converted pursuant to this
Agreement. Upon proper surrender of a Certificate or Certificates for exchange
and cancellation to the Exchange Agent, together with such properly completed
letter of transmittal, duly executed, the holder of such Certificate or
Certificates shall be entitled to receive in exchange therefor, as applicable,
(i) a certificate representing that number of whole shares of Fifth Third Common
Stock to which such holder of Old Kent Common Stock shall have become entitled
pursuant to the provisions of Article I, (ii) a check representing the amount of
any cash in lieu of fractional shares which such holder has the right to receive
in respect of the Certificate or Certificates surrendered pursuant to the
provisions of this Article II, and (iii) a check representing the amount of any
dividends or distributions then payable pursuant to Section 2.2(b)(i) and the
Certificate or Certificates so surrendered shall forthwith be cancelled. No
interest will be paid or accrued on any cash in lieu of fractional shares or on
any unpaid dividends and distributions payable to holders of Certificates.
(b) No dividends or other distributions declared with respect
to Fifth Third Common Stock shall be paid to the holder of any unsurrendered
Certificate until the holder thereof shall surrender such Certificate in
accordance with this Article II. After the surrender of a Certificate in
accordance with this Article II, the record holder thereof shall be entitled to
receive (i) the amount of dividends or other distributions
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with a record date after the Effective Time theretofore paid, without any
interest thereon, which theretofore had become payable and (ii), at the
appropriate payment date, the amount of dividends or other distributions with a
record date after the Effective Time but prior to surrender and a payment date
subsequent to surrender, with respect to shares of Fifth Third Common Stock
represented by such Certificate.
(c) If any certificate representing shares of Fifth Third
Common Stock is to be issued in a name other than that in which the Certificate
or Certificates surrendered in exchange therefor is or are registered, it shall
be a condition of the issuance thereof that the Certificate or Certificates so
surrendered shall be properly endorsed (or accompanied by an appropriate
instrument of transfer) and otherwise in proper form for transfer, and that the
person requesting such exchange shall pay to the Exchange Agent in advance any
transfer or other Taxes required by reason of the issuance of a certificate
representing shares of Fifth Third Common Stock in any name other than that of
the registered holder of the Certificate or Certificates surrendered, or
required for any other reason, or shall establish to the satisfaction of the
Exchange Agent that such Tax has been paid or is not payable.
(d) After the Effective Time, there shall be no transfers on
the stock transfer books of Old Kent of the shares of Old Kent Capital Stock
that were issued and outstanding immediately prior to the Effective Time other
than to settle transfers of Old Kent Common Stock that occurred prior to the
Effective Time and otherwise as necessary to prepare a list of the final
shareholders of Old Kent. If, after the Effective Time, Certificates
representing such shares are presented for transfer to the Exchange Agent, they
shall be cancelled and exchanged for certificates representing shares of Fifth
Third Common Stock as provided in this Article II.
(e) Notwithstanding anything to the contrary contained herein,
no certificates or scrip representing fractional shares of Fifth Third Common
Stock shall be issued upon the surrender for exchange of Certificates, no
dividend or distribution with respect to Fifth Third Common Stock shall be
payable on or with respect to any fractional share, and such fractional share
interests shall not entitle the owner thereof to vote or to any other rights of
a stockholder of Fifth Third. In lieu of the issuance of any such fractional
share, Fifth Third shall pay to each former stockholder of Old Kent who
otherwise would be entitled to receive such fractional share an amount in cash
determined by multiplying (i) the average of the closing-sale prices of Fifth
Third Common Stock on the NASDAQ National Market (the "NASDAQ") as reported by
The Wall Street Journal for the five trading days immediately preceding the
Closing Date by (ii) the fraction of a share (rounded to the nearest thousandth
when expressed in decimal form) of Fifth Third Common Stock which such holder
would otherwise be entitled to receive pursuant to Section 1.4.
(f) Any portion of the Exchange Fund that remains unclaimed by
the stockholders of Old Kent for 12 months after the Effective Time shall be
paid to Fifth Third. Any former stockholders of Old Kent who have not
theretofore complied with this Article II shall thereafter look only to Fifth
Third for payment of the shares of Fifth
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Third Common Stock, cash in lieu of any fractional shares and any unpaid
dividends and distributions on the Fifth Third Common Stock deliverable in
respect of each share of Old Kent Common Stock, as the case may be, such
stockholder holds as determined pursuant to this Agreement, in each case,
without any interest thereon. Notwithstanding the foregoing, none of Fifth
Third, Old Kent, the Exchange Agent or any other person shall be liable to any
former holder of shares of Old Kent Common Stock for any amount delivered in
good faith to a public official pursuant to applicable abandoned property,
escheat or similar laws.
(g) In the event any Certificate shall have been lost, stolen
or destroyed, upon the making of an affidavit of that fact by the person
claiming such Certificate to be lost, stolen or destroyed and, if reasonably
required by Fifth Third, the posting by such person of a bond in such amount as
Fifth Third may determine is reasonably necessary as indemnity against any claim
that may be made against it with respect to such Certificate, the Exchange Agent
will issue in exchange for such lost, stolen or destroyed Certificate the shares
of Fifth Third Common Stock and any cash in lieu of fractional shares
deliverable in respect thereof pursuant to this Agreement.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF OLD KENT
Except as disclosed in (i) the Old Kent disclosure schedule
delivered to Fifth Third prior to the execution of this Agreement (the "Old Kent
Disclosure Schedule") or (ii) the Old Kent Reports filed prior to the date
hereof, Old Kent hereby represents and warrants to Fifth Third as follows:
3.1 Corporate Organization. (a) Old Kent is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Michigan. Old Kent has the corporate power and authority to own or lease all of
its properties and assets and to carry on its business as it is now being
conducted, and is duly licensed or qualified to do business in each jurisdiction
in which the nature of the business conducted by it or the character or location
of the properties and assets owned or leased by it makes such licensing or
qualification necessary, except where the failure to be so licensed or qualified
would not, either individually or in the aggregate, have a Material Adverse
Effect on Old Kent. As used in this Agreement, the term "Material Adverse
Effect" means, with respect to Fifth Third, Old Kent or the Surviving
Corporation, as the case may be, a material adverse effect on (i) the business,
results of operations or financial condition of such party and its Subsidiaries
taken as a whole or (ii) the ability of such party to timely consummate the
transactions contemplated hereby; provided, however, that Material Adverse
Effect shall not be deemed to include effects to the extent resulting from (a)
changes in generally accepted accounting principles or regulatory accounting
requirements applicable to banks or savings associations and their holding
companies generally, (b) actions or omissions of Fifth Third or Old Kent taken
with the prior written consent of the other in contemplation of the transactions
contemplated hereby and (c) changes in general economic conditions affecting
banks or
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their holding companies generally.
(b) Old Kent is duly registered as a bank holding company
under the Bank Holding Company Act of 1956, as amended (the "BHC Act"). True and
complete copies of the Restated Articles of Incorporation of Old Kent (the "Old
Kent Articles") and the Bylaws of Old Kent (the "Old Kent Bylaws") have
previously been made available by Old Kent to Fifth Third. Old Kent was
certified as a "financial holding company" (an "FHC") within the meaning of
Section 2(p) of the BHC Act, and remains a certified FHC on the date hereof.
(c) Each of Old Kent's Subsidiaries (i) is duly organized and
validly existing under the laws of its jurisdiction of organization, (ii) is
duly qualified to do business and in good standing in all jurisdictions (whether
federal, state, local or foreign) where its ownership or leasing of property or
the conduct of its business requires it to be so qualified and in which the
failure to be so qualified would have a Material Adverse Effect on Old Kent and
(iii) has all requisite corporate power and authority to own or lease its
properties and assets and to carry on its business as now conducted. As used in
this Agreement, the word "Subsidiary" when used with respect to any party, means
any bank, corporation, partnership, limited liability company, or other
organization, whether incorporated or unincorporated, which is consolidated with
such party for financial reporting purposes, and the words "Old Kent Subsidiary"
and "Fifth Third Subsidiary" shall mean any direct or indirect Subsidiary of Old
Kent or Fifth Third, respectively.
(d) Section 3.1(d) of the Old Kent Disclosure Schedule sets
forth the names of each of the entities in which Old Kent holds, in the
aggregate, at least 5% of the issued and outstanding shares of capital stock or
voting power.
3.2 Capitalization. (a) The authorized capital stock of Old
Kent consists of (i) 300,000,000 shares of Old Kent Common Stock, of which, as
of September 30, 2000, 137,029,000 shares were issued and outstanding and no
shares were held in treasury, and (ii) 25,000,000 shares of preferred stock,
without par value (the "Old Kent Preferred Stock," and, together with the Old
Kent Common Stock, the "Old Kent Capital Stock"), of which, as of September 30,
2000, 3,000,000 shares were designated as Old Kent Series A Preferred Stock and
no shares were issued or outstanding, 500,000 shares were designated as Series B
Preferred Stock and no shares were issued or outstanding, 1,000,000 shares were
designated as Series C Preferred Stock and no shares were issued or outstanding,
7,250 shares were designated, issued and outstanding as Old Kent Series D
Perpetual Preferred Stock and 2,000 shares were designated, issued and
outstanding as Old Kent Series E Perpetual Preferred Stock . All of the issued
and outstanding shares of Old Kent Common Stock have been duly authorized and
validly issued and are fully paid, nonassessable and free of preemptive rights,
with no personal liability attaching to the ownership thereof. As of the date of
this Agreement, except as described in this Section 3.2(a) and except pursuant
to the terms of (i) the Old Kent Option Agreement, (ii) options issued pursuant
to the Old Xxxx Xxxxx Plans and (iii) the Old Kent Rights Agreement, Old Kent
does not have and is not bound by any
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outstanding subscriptions, options, warrants, calls, commitments or agreements
of any character calling for the purchase or issuance of any shares of Old Kent
Capital Stock or any other equity securities of Old Kent or any securities
representing the right to purchase or otherwise receive any shares of Old Kent
Capital Stock (collectively, including the items contemplated by clauses (i)
through (iii) of this sentence, the "Old Kent Rights"). As of November 10, 2000,
no shares of Old Kent Capital Stock were reserved for issuance, except for
525,000 shares of Old Kent Common Stock reserved for issuance in connection with
OK Invest Direct (the "Old Kent DRIP"), 8,080,839 shares of common stock
reserved for issuance in connection with the Old Kent Directors' Deferred
Compensation Plan and upon the exercise of stock options pursuant to the Old
Xxxx Xxxxx Plans and in respect of the employee and director savings,
compensation and deferred compensation plans described in Section 3.11(a) of the
Old Kent Disclosure Schedule, 1,000,000 shares of Series C Preferred Stock of
Old Kent, were reserved for issuance in connection with the Old Kent Rights
Agreement and 417,000 shares of Old Kent Common Stock were reserved for issuance
in connection with the conversion of the Old Kent Series D Perpetual Preferred
Stock. Since November 10, 2000, Old Kent has not issued any shares of its
capital stock or any securities convertible into or exercisable for any shares
of its capital stock, other than as permitted by Section 5.2(b). Old Kent has
previously provided Fifth Third with a list of the aggregate number of options
outstanding under the Old Xxxx Xxxxx Plans as of September 30, 2000 and the
weighted average exercise price for such options.
(b) Old Kent owns, directly or indirectly, all of the issued
and outstanding shares of capital stock or other equity ownership interests of
each of Old Kent's Subsidiaries, free and clear of any material liens, pledges,
charges and security interests and similar encumbrances ("Liens"), and all of
such shares or equity ownership interests are duly authorized and validly issued
and are fully paid, nonassessable and free of preemptive rights, with no
personal liability attaching to the ownership thereof. No Old Kent Subsidiary
has or is bound by any outstanding subscriptions, options, warrants, calls,
commitments or agreements of any character calling for the purchase or issuance
of any shares of capital stock or any other equity security of such Subsidiary
or any securities representing the right to purchase or otherwise receive any
shares of capital stock or any other equity security of such Subsidiary. Section
3.2(b) of the Old Kent Disclosure Schedule sets forth a list of the material
investments of Old Kent in corporations, joint ventures, partnerships, limited
liability companies and other entities other than its Subsidiaries.
3.3 Authority; No Violation. (a) Old Kent has full corporate
power and authority to execute and deliver this Agreement and the Old Kent
Option Agreement and to consummate the transactions contemplated hereby and
thereby. The execution and delivery of this Agreement and the Old Kent Option
Agreement and the consummation of the transactions contemplated hereby and
thereby have been duly and validly approved by the Board of Directors of Old
Kent. The Board of Directors of Old Kent has determined that this Agreement and
the transactions contemplated hereby are in the best interests of Old Kent and
its stockholders and has directed that this Agreement and the transactions
contemplated hereby be submitted to Old Kent's
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stockholders for adoption at a duly held meeting of such stockholders and,
except for the approval of this Agreement and the transactions contemplated
hereby by the affirmative vote of the holders of a majority of the outstanding
shares of Old Kent Common Stock voted at such meeting, no other corporate
proceedings on the part of Old Kent are necessary to approve this Agreement or
the Old Kent Option Agreement or to consummate the transactions contemplated
hereby or thereby. This Agreement and the Old Kent Option Agreement have been
duly and validly executed and delivered by Old Kent and (assuming due
authorization, execution and delivery by Fifth Third) constitute valid and
binding obligations of Old Kent, enforceable against Old Kent in accordance with
its terms (except as may be limited by bankruptcy, insolvency, moratorium,
reorganization or similar laws affecting the rights of creditors generally and
the availability of equitable remedies).
(b) Neither the execution and delivery of this Agreement or
the Old Kent Option Agreement by Old Kent nor the consummation by Old Kent of
the transactions contemplated hereby or thereby, nor compliance by Old Kent with
any of the terms or provisions hereof or thereof, will (i) violate any provision
of the Old Kent Articles or the Old Kent Bylaws or (ii) assuming that the
consents and approvals referred to in Section 3.4 are duly obtained, (x) violate
any statute, code, ordinance, rule, regulation, judgment, order, writ, decree or
injunction applicable to Old Kent, any of its Subsidiaries or any of their
respective properties or assets or (y) violate, conflict with, result in a
breach of any provision of or the loss of any benefit under, constitute a
default (or an event which, with notice or lapse of time, or both, would
constitute a default) under, result in the termination of or a right of
termination or cancellation under, accelerate the performance required by, or
result in the creation of any Lien upon any of the respective properties or
assets of Old Kent, any of its Subsidiaries under, any of the terms, conditions
or provisions of any note, bond, mortgage, indenture, deed of trust, license,
lease, agreement or other instrument or obligation to which Old Kent or any of
its Subsidiaries is a party, or by which they or any of their respective
properties or assets may be bound or affected, except (in the case of clause (y)
above) for such violations, conflicts, breaches or defaults which, either
individually or in the aggregate, will not have a Material Adverse Effect on Old
Kent.
3.4 Consents and Approvals. Except for (i) the filing of
applications and notices, as applicable, with the Board of Governors of the
Federal Reserve System (the "Federal Reserve Board") under the BHC Act and the
Federal Reserve Act, as amended, and approval of such applications and notices,
(ii) the filing of any required applications or notices with any state agencies
and approval of such applications and notices (the "State Approvals"), (iii) the
filing with the Securities and Exchange Commission (the "SEC") of a proxy
statement in definitive form relating to the meetings of each of Old Kent's and
Fifth Third's stockholders to be held in connection with this Agreement and the
transactions contemplated hereby (the "Joint Proxy Statement"), and of the
registration statement on Form S-4 (the "S-4") in which the Joint Proxy
Statement will be included as a prospectus, (iv) the filing of the Ohio
Certificate of Merger with the Secretary of State of the State of Ohio pursuant
to the OGCL and the filing of the Michigan Certificate of Merger with the
appropriate office of the State of Michigan
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pursuant to the MBCA, (v) any notices to or filings with the Small Business
Administration (the "SBA"), (vi) any notices or filings under the
Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as amended (the "HSR
Act"), (vii) any consents, authorizations, approvals, filings or exemptions in
connection with compliance with the applicable provisions of federal and state
securities laws relating to the regulation of broker-dealers, investment
advisers or transfer agents, and federal commodities laws relating to the
regulation of futures commission merchants and the rules and regulations
thereunder and of any applicable industry self-regulatory organization ("SRO"),
and the rules of the NASDAQ, or which are required under consumer finance,
mortgage banking and other similar laws, (viii) such filings and approvals as
are required to be made or obtained under the securities or "Blue Sky" laws of
various states in connection with the issuance of the shares of Fifth Third
Common Stock pursuant to this Agreement, (ix) such filings and approvals as are
required to be made with or obtained from the Office of the Comptroller of the
Currency (the "OCC") and (x) the approval of this Agreement by the requisite
vote of stockholders of Old Kent, no consents or approvals of or filings or
registrations with any court, administrative agency or commission or other
governmental authority or instrumentality (each a "Governmental Entity") are
necessary in connection with (A) the execution and delivery by Old Kent of this
Agreement and the Old Kent Option Agreement and (B) the consummation by Old Kent
of the Merger and the other transactions contemplated hereby and by the Old Kent
Option Agreement.
3.5 Reports. Old Kent and each of its Subsidiaries have timely
filed all reports, registrations and statements, together with any amendments
required to be made with respect thereto, that they were required to file since
January 1, 1997 with (i) the Federal Reserve Board, (ii) the Federal Deposit
Insurance Corporation, (iii) any state regulatory authority, (iv) the SEC, (v)
any foreign regulatory authority and (vi) any SRO (collectively, "Regulatory
Agencies"), and all other reports and statements required to be filed by them
since January 1, 1997, including, without limitation, any report or statement
required to be filed pursuant to the laws, rules or regulations of the United
States, any state, any foreign entity, or any Regulatory Agency, and have paid
all fees and assessments due and payable in connection therewith, except where
the failure to file such report, registration or statement or to pay such fees
and assessments, either individually or in the aggregate, will not have a
Material Adverse Effect on Old Kent. Except for normal examinations conducted by
a Regulatory Agency in the ordinary course of the business of Old Kent and its
Subsidiaries, no Regulatory Agency has initiated or has pending any proceeding
or, to the best knowledge of Old Kent, investigation into the business or
operations of Old Kent or any of its Subsidiaries since January 1, 1997, except
where such proceedings or investigation will not, either individually or in the
aggregate, have a Material Adverse Effect on Old Kent. There (i) is no
unresolved violation, criticism, or exception by any Regulatory Agency with
respect to any report or statement relating to any examinations or inspections
of Old Kent or any of its Subsidiaries and (ii) has been no formal or informal
inquiries by, or disagreements or disputes with, any Regulatory Agency with
respect to the business, operations policies or procedures of Old Kent since
January 1, 1997, which, in the
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reasonable judgment of Old Kent, will, either individually or in the aggregate,
have a Material Adverse Effect on Old Kent.
3.6 Financial Statements. Old Kent has previously made
available to Fifth Third copies of (i) the consolidated balance sheet of Old
Kent and its Subsidiaries as of December 31, for the fiscal years 1998 and 1999,
and the related consolidated statements of income, changes in shareholders'
equity and cash flows for the fiscal years 1997 through 1999, inclusive, as
reported in Old Kent's Annual Report on Form 10-K for the fiscal year ended
December 31, 1999 (the "Old Kent 1999 10-K") filed with the SEC under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), accompanied by
the audit report of Xxxxxx Xxxxxxxx LLP, independent public accountants with
respect to Old Kent and (ii) the unaudited consolidated balance sheet of Old
Kent and its Subsidiaries as of September 30, 1999 and 2000, and the related
consolidated statements of income, changes in shareholders' equity and cash
flows of the nine month periods then ended, as reported in Old Kent's Quarterly
Report on Form 10-Q for the fiscal period ended September 30, 2000. The December
31, 1999 consolidated balance sheet of Old Kent (including the related notes,
where applicable) fairly presents in all material respects the consolidated
financial position of Old Kent and its Subsidiaries as of the date thereof, and
the other financial statements referred to in this Section 3.6 (including the
related notes, where applicable) fairly present in all material respects the
results of the consolidated operations and changes in stockholders' equity and
consolidated financial position of Old Kent and its Subsidiaries for the
respective fiscal periods or as of the respective dates therein set forth,
subject to normal year-end audit adjustments in amounts consistent with past
experience in the case of unaudited statements; each of such statements
(including the related notes, where applicable) complies in all material
respects with applicable accounting requirements and with the published rules
and regulations of the SEC with respect thereto; and each of such statements
(including the related notes, where applicable) has been prepared in all
material respects in accordance with GAAP consistently applied during the
periods involved, except, in each case, as indicated in such statements or in
the notes thereto. The books and records of Old Kent and its Subsidiaries have
been, and are being, maintained in all material respects in accordance with GAAP
and any other applicable legal and accounting requirements and reflect only
actual transactions.
3.7 Broker's Fees. Neither Old Kent nor any Old Kent
Subsidiary nor any of their respective officers or directors has employed any
broker or finder or incurred any liability for any broker's fees, commissions or
finder's fees other than fees payable to Xxxxxxx Xxxxx & Co. in connection with
the Merger or related transactions contemplated by this Agreement.
3.8 Absence of Certain Changes or Events. (a) Since December
31, 1999, no event or events have occurred that have had, either individually or
in the aggregate, a Material Adverse Effect on Old Kent.
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(b) Since December 31, 1999 through and including the date
hereof, Old Kent and its Subsidiaries have carried on their respective
businesses in all material respects in the ordinary course.
(c) Since December 31, 1999, neither Old Kent nor any of its
Subsidiaries has (i) except for normal increases for employees (other than
officers subject to the reporting requirements of Section 16(a) of the Exchange
Act) made in the ordinary course of business consistent with past practice or as
required by applicable law, increased the wages, salaries, compensation,
pension, or other fringe benefits or perquisites payable to any executive
officer, employee, or director from the amount thereof in effect as of December
31, 1999, granted any severance or termination pay, entered into any contract to
make or grant any severance or termination pay, or paid any bonus other than the
customary year-end bonuses for fiscal 2000 and 1999 in amounts consistent with
past practice, (ii) granted any stock appreciation rights or granted any rights
to acquire any shares of its capital stock to any executive officer, director or
employee other than grants to employees (other than officers subject to the
reporting requirements of Section 16(a) of the Exchange Act) made in the
ordinary course of business consistent with past practice under the Old Xxxx
Xxxxx Plans and except as permitted by Section 5.2(b)(iii), or (iii) suffered
any strike, work stoppage, slow-down, or other labor disturbance.
3.9 Legal Proceedings. (a) Neither Old Kent nor any of its
Subsidiaries is a party to any, and there are no pending or, to the best of Old
Kent's knowledge, threatened, legal, administrative, arbitral or other
proceedings, claims, actions or governmental or regulatory investigations of any
nature against Old Kent or any of its Subsidiaries or challenging the validity
or propriety of the transactions contemplated by this Agreement or the Old Kent
Option Agreement as to which, in any such case, there is a reasonable
probability of an adverse determination and which, if adversely determined,
will, either individually or in the aggregate, have a Material Adverse Effect on
Old Kent.
(b) There is no Injunction, judgment, or regulatory
restriction (other than those of general application that apply to similarly
situated bank holding companies or their Subsidiaries) imposed upon Old Kent,
any of its Subsidiaries or the assets of Old Kent or any of its Subsidiaries
that has had, or will have, either individually or in the aggregate, a Material
Adverse Effect on Old Kent or the Surviving Corporation.
3.10 Taxes and Tax Returns. (a) Each of Old Kent and its
Subsidiaries has duly filed all federal, state, foreign and local information
returns and Tax returns required to be filed by it on or prior to the date
hereof (all such returns being accurate and complete in all material respects)
and has duly paid or made provision for the payment of all Taxes and other
governmental charges which have been incurred or are due or claimed to be due
from it by federal, state, foreign or local taxing authorities (including,
without limitation, if and to the extent applicable, those due in respect of its
properties, income, business, capital stock, deposits, franchises, licenses,
sales and payrolls) other than (i) Taxes or other government charges which are
not yet delinquent
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or are being contested in good faith, have not been finally determined and have
been adequately reserved against in accordance with GAAP or (ii) information
returns, Tax returns, Taxes or other governmental charges as to which the
failure to file, pay or make provision for will not have, either individually or
in the aggregate, a Material Adverse Effect on Old Kent. The federal income Tax
returns of Old Kent and its Subsidiaries have been examined by the Internal
Revenue Service (the "IRS") for all years from 1990 to and including 1995 and
any liability with respect thereto has been satisfied or any liability with
respect to deficiencies asserted as a result of such examination is covered by
adequate reserves. There are no material disputes pending, or claims asserted,
for Taxes or assessments upon Old Kent or any of its Subsidiaries for which Old
Kent does not have adequate reserves maintained in accordance with GAAP. Neither
Old Kent nor any of its Subsidiaries is a party to or is bound by any Tax
sharing, allocation or indemnification agreement or arrangement (other than such
an agreement or arrangement exclusively between or among Old Kent and its
Subsidiaries). Within the past five years, neither Old Kent nor any of its
Subsidiaries has been a "distributing corporation" or a "controlled corporation"
in a distribution intended to qualify under Section 355(a) of the Code.
(b) As used in this Agreement, the term "Tax" or "Taxes" means
(i) all federal, state, local, and foreign income, excise, gross receipts, gross
income, and valorem, profits, gains, property, capital, sales, transfer, use,
payroll, employment, severance, withholding, duties, intangibles, franchise,
backup withholding, and other taxes, charges, levies or like assessments
together with all penalties and additions to tax and interest thereon and (ii)
any liability for Taxes described in clause (i) under Treasury Regulation
Section 1.1502-6 (or any similar provision of state, local or foreign law).
(c) No disallowance of a deduction under Section 162(m) of the
Code for employee remuneration of any amount paid or payable by Old Kent or any
of its Subsidiaries under any contract, plan, program, arrangement or
understanding would be reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect on Old Kent.
3.11 Employees. (a) The Old Kent Disclosure Schedule sets
forth a true and complete list of each material employee or director benefit or
compensation plan, arrangement or agreement, and any material bonus, incentive,
deferred compensation, vacation, stock purchase, stock option, severance,
employment, change of control or fringe benefit plan, program or agreement that
is maintained, or contributed to, presently or at any time within the last four
(4) years (the "Old Kent Benefit Plans") by Old Kent, any of its Subsidiaries or
by any trade or business, whether or not incorporated (a "Old Kent ERISA
Affiliate"), all of which together with Old Kent would be deemed a "single
employer" within the meaning of Section 4001 of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"). The term "Benefit Plan" for all
purposes of this Agreement shall include each Predecessor Plan (as herein
defined). For purposes hereof, "Predecessor Plan" shall mean any plan, program,
policy, practice, arrangement, agreement or system as otherwise described in
Section 3.12(a)
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which was maintained, contributed to or resulted in liability to any predecessor
employer of Company or any of the Company Subsidiaries since January 1, 1997.
For purposes hereof, "predecessor employer" shall mean any employer, entity or
business operation acquired by Company or any of the Company Subsidiaries in any
type of acquisition (including, without limitation, mergers, stock acquisitions
and asset acquisitions).
(b) Old Kent has heretofore made available to Fifth Third true
and complete copies of each of the Old Kent Benefit Plans and certain related
documents, including, but not limited to, (i) the actuarial report for such Old
Kent Benefit Plan (if applicable) for each of the last two years and (ii) the
most recent determination letter from the IRS (if applicable) for such Old Kent
Benefit Plan.
(c) Except for such noncompliance as would not have, and would
not reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect on Old Kent, (i) each of the Old Kent Benefit Plans has been
operated and administered in all material respects in compliance with applicable
laws, including, but not limited to, ERISA and the Code, (ii) each of the Old
Kent Benefit Plans intended to be "qualified" within the meaning of Section 401
(a) of the Code is so qualified, and there are no existing circumstances or any
events that have occurred that will adversely affect the qualified status of any
such Old Kent Benefit Plan, and has received an IRS determination letter which
determined that such Qualified Benefit Plan (as amended by any and all
amendments) satisfies the requirements of Section 401(a) of the Code, as amended
by all the laws referred to in Section 1 of Revenue Procedure 93-39, such
determination letter has not been revoked or threatened to be revoked by the
IRS, and the scope of such determination letter is complete and does not exclude
consideration of any of the requirements or matters referred to in Sections 4.02
through 4.04 of Revenue Procedure 93-39 (iii) with respect to each Old Kent
Benefit Plan that is subject to Title IV of ERISA, the present value (as defined
under Section 3(26) of ERISA) of accumulated benefit obligations under such Old
Kent Benefit Plan, based upon the actuarial assumptions used for funding
purposes in the most recent actuarial report prepared by such Old Kent Benefit
Plan's actuary with respect to such Old Kent Benefit Plan, did not, as of its
latest valuation date, exceed the then current value (as defined under Section
3(26) of ERISA) of the assets of such Old Kent Benefit Plan allocable to such
accrued benefits, (iv) no Old Kent Benefit Plan provides benefits coverage,
including, without limitation, death or medical benefits coverage (whether or
not insured), with respect to current or former employees or directors of Old
Kent or its Subsidiaries beyond their retirement or other termination of
service, other than (A) coverage mandated by applicable law, (B) death benefits
or retirement benefits under any "employee pension plan" (as such term is
defined in Section 3(2) of ERISA), (C) deferred compensation benefits accrued as
liabilities on the books of Old Kent or its Subsidiaries, (D) benefits the full
cost of which is borne by the current or former employee or director (or his
beneficiary), (E) coverage through the last day of the calendar month in which
retirement or other termination of service occurs, or (F) medical expense
reimbursement accounts, (v) no liability under Title IV of ERISA has been
incurred by Old Kent, its Subsidiaries or any Old Kent ERISA Affiliate that has
not
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been satisfied in full, and no condition exists that presents a material risk to
Old Kent, its Subsidiaries or any Old Kent ERISA Affiliate of incurring a
liability thereunder, (vi) no Old Kent Benefit Plan is a "multiemployer pension
plan" (as such term is defined in Section 3(37) of ERISA), (vii) none of Old
Kent, its Subsidiaries or any other person, including any fiduciary, has engaged
in a transaction in connection with which Old Kent, its Subsidiaries or any Old
Kent Benefit Plan will be subject to either a material civil penalty assessed
pursuant to Section 409 or 502(i) of ERISA or a material Tax imposed pursuant to
Section 4975 or 4976 of the Code, (viii) to the best knowledge of Old Kent there
are no pending, threatened or anticipated claims (other than routine claims for
benefits) by, on behalf of or against any of the Old Kent Benefit Plans or any
trusts related thereto that will have, either individually or in the aggregate,
a Material Adverse Effect on Old Kent, (x) no employee, former employee, plan
participant or any other party (other than Company) has any entitlement (under
the terms of any plan document or otherwise) to any surplus assets in any
defined benefit plan as defined in Section 414(j) of the Code and (xi) Company
has all power and authority necessary to amend or terminate each Benefit Plan
without incurring any penalty or liability provided that, in the case of an
employee pension benefit plan (as defined in section 3(2) of ERISA), benefits
accrued as of the date of amendment or termination are not reduced.
(d) Neither the execution and delivery of this Agreement nor
the consummation of the transactions contemplated hereby will (either alone or
in conjunction with any other event) (i) result in any payment (including,
without limitation, severance, unemployment compensation, "excess parachute
payment" (within the meaning of Section 280G of the Code), forgiveness of
indebtedness or otherwise) becoming due to any director or any employee of Old
Kent or any of its affiliates from Old Kent or any of its affiliates under any
Old Kent Benefit Plan or otherwise, (ii) increase any benefits otherwise payable
under any Old Kent Benefit Plan or (iii) result in any acceleration of the time
of payment or vesting of any such benefits.
3.12 SEC Reports. Old Kent has previously made available to
Fifth Third an accurate and complete copy of each (a) final registration
statement, prospectus, report, schedule and definitive proxy statement filed
since January 1, 1997 by Old Kent with the SEC pursuant to the Securities Act of
1933, as amended (the "Securities Act"), or the Exchange Act (the "Old Kent
Reports") and prior to the date hereof and (b) communication mailed by Old Kent
to its stockholders since January 1, 1997 and prior to the date hereof, and no
such Old Kent Report or communication, as of the date thereof, contained any
untrue statement of a material fact or omitted to state any material fact
required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances in which they were made, not misleading,
except that information as of a later date (but before the date hereof) shall be
deemed to modify information as of an earlier date. Since January 1, 1997, as of
their respective dates, all Old Kent Reports filed under the Securities Act and
the Exchange Act complied in all material respects with the published rules and
regulations of the SEC with respect thereto.
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3.13 Compliance with Applicable Law. (a) Old Kent and each of
its Subsidiaries hold all material licenses, franchises, permits and
authorizations necessary for the lawful conduct of their respective businesses
under and pursuant to each, and have complied in all material respects with and
are not in default in any material respect under any, applicable law, statute,
order, rule, regulation, policy and/or guideline of any Governmental Entity
relating to Old Kent or any of its Subsidiaries, except where the failure to
hold such license, franchise, permit or authorization or such noncompliance or
default will not, either individually or in the aggregate, have a Material
Adverse Effect on Old Kent.
(b) Except as will not have, either individually or in the
aggregate, a Material Adverse Effect on Old Kent, Old Kent and each Old Kent
Subsidiary have properly administered all accounts for which it acts as a
fiduciary, including accounts for which it serves as a trustee, agent,
custodian, personal representative, guardian, conservator or investment advisor,
in accordance with the terms of the governing documents, applicable state and
federal law and regulation and common law. None of Old Kent, any Old Kent
Subsidiary, or any director, officer or employee of Old Kent or of any Old Kent
Subsidiary, has committed any breach of trust with respect to any such fiduciary
account that will have a Material Adverse Effect on Old Kent, and the
accountings for each such fiduciary account are true and correct in all material
respects and accurately reflect the assets of such fiduciary account.
3.14 Certain Contracts. (a) Neither Old Kent nor any of its
Subsidiaries is a party to or bound by any contract, arrangement, commitment or
understanding (whether written or oral) (i) with respect to the employment of
any directors, officers or employees, other than in the ordinary course of
business consistent with past practice, (ii) which, upon the consummation or
stockholder approval of the transactions contemplated by this Agreement will
(either alone or upon the occurrence of any additional acts or events) result in
any payment (whether of severance pay or otherwise) becoming due from Fifth
Third, Old Kent, the Surviving Corporation, or any of their respective
Subsidiaries to any officer or employee thereof, (iii) which is a "material
contract" (as such term is defined in Item 601(b)(10) of Regulation S-K of the
SEC) to be performed after the date of this Agreement that has not been filed or
incorporated by reference in the Old Kent Reports, (iv) which materially
restricts the conduct of any line of business by Old Kent or upon consummation
of the Merger will materially restrict the ability of the Surviving Corporation
to engage in any line of business in which a bank holding company may lawfully
engage, (v) with or to a labor union or guild (including any collective
bargaining agreement) or (vi) (including any stock option plan, stock
appreciation rights plan, restricted stock plan or stock purchase plan) any of
the benefits of which will be increased, or the vesting of the benefits of which
will be accelerated, by the occurrence of any stockholder approval or the
consummation of any of the transactions contemplated by this Agreement, or the
value of any of the benefits of which will be calculated on the basis of any of
the transactions contemplated by this Agreement. Old Kent has previously made
available to Fifth Third true and correct copies of all employment and deferred
compensation agreements which are in writing and to which Old Kent or any of its
Subsidiaries is a party. Each contract, arrangement,
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commitment or understanding of the type described in this Section 3.14(a),
whether or not set forth in the Old Kent Disclosure Schedule, is referred to
herein as a "Old Kent Contract," and neither Old Kent nor any of its
Subsidiaries knows of, or has received notice of, any violation of the above by
any of the other parties thereto which, either individually or in the aggregate,
will have a Material Adverse Effect on Old Kent.
(b) With such exceptions that, either individually or in the
aggregate, will not have a Material Adverse Effect on Old Kent, (i) each Old
Kent Contract is valid and binding on Old Kent or any of its Subsidiaries, as
applicable, and is in full force and effect, (ii) Old Kent and each of its
Subsidiaries has in all material respects performed all obligations required to
be performed by it to date under each Old Kent Contract, and (iii) no event or
condition exists which constitutes or, after notice or lapse of time or both,
will constitute, a material default on the part of Old Kent or any of its
Subsidiaries under any such Old Kent Contract.
3.15 Agreements with Regulatory Agencies. Neither Old Kent nor
any of its Subsidiaries is subject to any cease-and-desist or other order or
enforcement action issued by, or is a party to any written agreement, consent
agreement or memorandum of understanding with, or is a party to any commitment
letter or similar undertaking to, or is subject to any order or directive by, or
has been ordered to pay any civil money penalty by, or has been since January 1,
1997, a recipient of any supervisory letter from, or since January 1, 1997, has
adopted any policies, procedures or board resolutions at the request or
suggestion of any Regulatory Agency or other Governmental Entity that currently
restricts in any material respect the conduct of its business or that in any
material manner relates to its capital adequacy, its ability to pay dividends,
its credit or risk management policies, its management or its business (each
item in this sentence, whether or not set forth in the Old Kent Disclosure
Schedule, a "Old Kent Regulatory Agreement"), nor has Old Kent or any of its
Subsidiaries been advised since January 1, 1997, by any Regulatory Agency or
other Governmental Entity that it is considering issuing, initiating, ordering,
or requesting any such Old Kent Regulatory Agreement.
3.16 Interest Rate Risk Management Instruments. All interest
rate swaps, caps, floors and option agreements and other interest rate risk
management arrangements, whether entered into for the account of Old Kent or for
the account of a customer of Old Kent or any of its Subsidiaries, were entered
into in the ordinary course of business consistent with past practice and, to
Old Kent's knowledge, in accordance with prudent banking practice and applicable
rules, regulations and policies of any Regulatory Authority and with
counterparties believed to be financially responsible at the time and are legal,
valid and binding obligations of Old Kent or one of its Subsidiaries enforceable
in accordance with their terms (except as may be limited by bankruptcy,
insolvency, moratorium, reorganization or similar laws affecting the rights of
creditors generally and the availability of equitable remedies), and are in full
force and effect. Old Kent and each of its Subsidiaries have duly performed in
all material respects all of their material obligations thereunder to the extent
that such obligations to perform have accrued; and, to Old Kent's knowledge,
there are no material breaches, violations or defaults or allegations or
assertions of such by any party thereunder.
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3.17 Undisclosed Liabilities. Except for those liabilities
that are fully reflected or reserved against on the consolidated balance sheet
of Old Kent included in the Old Kent 1999 10-K and for liabilities incurred in
the ordinary course of business consistent with past practice since December 31,
1999, since such date, neither Old Kent nor any of its Subsidiaries has incurred
any liability of any nature whatsoever (whether absolute, accrued, contingent or
otherwise and whether due or to become due) that, either individually or in the
aggregate (including if considered together with liabilities incurred in the
ordinary course of business consistent with past practice since December 31,
1999), has had or will have a Material Adverse Effect on Old Kent.
3.18 Environmental Liability. There are no legal,
administrative, arbitral or other proceedings, claims, actions, causes of
action, private environmental investigations or remediation activities or
governmental investigations of any nature seeking to impose, or that could
reasonably result in the imposition, on Old Kent of any liability or obligation
arising under common law or under any local, state or federal environmental
statute, regulation or ordinance including, without limitation, the
Comprehensive Environmental Response, Compensation and Liability Act of 1980, as
amended, pending or threatened against Old Kent, which liability or obligation
will, either individually or in the aggregate, have a Material Adverse Effect on
Old Kent. To the knowledge of Old Kent, there is no reasonable basis for any
such proceeding, claim, action or governmental investigation that would impose
any liability or obligation that will, individually or in the aggregate, have a
Material Adverse Effect on Old Kent. Old Kent is not subject to any agreement,
order, judgment, decree, letter or memorandum by or with any Governmental
Authority or third party imposing any liability or obligation with respect to
the foregoing that will have, either individually or in the aggregate, a
Material Adverse Effect on Old Kent.
3.19 Intellectual Property. Except as would not reasonably be
expected to have a Material Adverse Effect on Old Kent, to the knowledge of Old
Kent: (a) Old Kent and each of its Subsidiaries owns, or is licensed to use (in
each case, free and clear of any liens), all Intellectual Property (as defined
below) used in or necessary for the conduct of its business as currently
conducted; (b) the use of any Intellectual Property by Old Kent and its
Subsidiaries does not infringe on or otherwise violate the rights of any person
and is in accordance with any applicable license pursuant to which Old Kent or
any Subsidiary acquired the right to use any Intellectual Property; (c) no
Person is challenging, infringing on or otherwise violating any right of Old
Kent or any of its Subsidiaries with respect to any Intellectual Property owned
by and/or licensed to Old Kent or its Subsidiaries; and (d) neither Old Kent nor
any of its Subsidiaries has received any written notice of any pending claim
with respect to any Intellectual Property used by Old Kent and its Subsidiaries
and no Intellectual Property owned and/or licensed by Old Kent or its
Subsidiaries is being used or enforced in a manner that would result in the
abandonment, cancellation or unenforceability of such Intellectual Property. For
purposes of this Agreement, "Intellectual Property" shall mean trademarks,
service marks, brand names, certification marks, trade dress and other
indications of origin, the goodwill associated with the foregoing and
registrations in any jurisdiction of, and applications in any jurisdiction to
register, the foregoing,
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including any extension, modification or renewal of any such registration or
application; inventions, discoveries and ideas, whether patentable or not, in
any jurisdiction; patents, applications for patents (including, without
limitation, divisions, continuations, continuations in part and renewal
applications), and any renewals, extensions or reissues thereof, in any
jurisdiction; nonpublic information, trade secrets and confidential information
and rights in any jurisdiction to limit the use or disclosure thereof by any
person; writings and other works, whether copyrightable or not, in any
jurisdiction; and registrations or applications for registration of copyrights
in any jurisdiction, and any renewals or extensions thereof; any similar
intellectual property or proprietary rights.
3.20 State Takeover Laws; Old Kent Rights Agreement. (a) The
Board of Directors of Old Kent has approved this Agreement and the Old Kent
Option Agreement and the transactions contemplated hereby and thereby for
purposes of rendering inapplicable to such agreements and transactions the
Michigan Control Share Acquisitions statute (Chapter 7B of the MBCA), Section
780 of the MBCA, the Old Kent Rights Agreement, Article XII of the Old Kent
Articles and, to the best knowledge of Old Kent, any similar "takeover" or
"interested stockholder" law (all such laws, including the Michigan Control
Share Acquisitions statute (Chapter 7B of the MBCA) and Section 780 of the MBCA,
"Takeover Statutes").
(b) Old Kent has taken all action, if any, necessary or
appropriate so that the entering into of this Agreement and the Old Kent Option
Agreement, and the consummation of the transactions contemplated hereby and
thereby do not and will not result in the ability of any person to exercise any
Old Kent Stockholder Rights under the Old Kent Rights Agreement or enable or
require Old Kent Stockholder Rights to separate from the shares of Old Kent
Common Stock to which they are attached or to be triggered or become
exercisable. No "Triggering Event" or "Stock Acquisition Date" (as such terms
are defined in the Old Kent Rights Agreement) has occurred.
3.21 Reorganization; Pooling of Interests. As of the date of
this Agreement, Old Kent has no reason to believe that the Merger will not
qualify as a "reorganization" within the meaning of Section 368(a) of the Code
and as a "pooling of interests" for accounting purposes.
3.22 Opinions. Prior to the execution of this Agreement, Old
Kent has received an opinion from Xxxxxxx Xxxxx & Co. to the effect that as of
the date thereof and based upon and subject to the matters set forth therein,
the Exchange Ratio is fair to the stockholders of Old Kent from a financial
point of view. Such opinion has not been amended or rescinded as of the date of
this Agreement.
3.23 Old Kent Information. The information relating to Old
Kent and its Subsidiaries which is provided by Old Kent or its representatives
for inclusion in the Joint Proxy Statement and the S-4, or in any other document
filed with any other Regulatory Agency in connection herewith, will not contain
any untrue statement of a material fact or omit to state a material fact
necessary to make the statements therein, in light of the circumstances in which
they are made, not misleading. The Joint Proxy
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Statement (except for such portions thereof that relate only to Fifth Third or
any of its Subsidiaries) will comply with the provisions of the Exchange Act and
the rules and regulations thereunder.
3.24 Loan Losses. Since December 31, 1999, none of the bank
Subsidiaries of Old Kent (the "Old Kent Bank Subsidiaries") has incurred any
unusual or extraordinary loan losses which are material to Old Kent and the Old
Kent Subsidiaries on a consolidated basis; to the best knowledge of Old Kent and
in light of each of the Old Kent Bank Subsidiaries' historical loan loss
experience and its management's analysis of the quality and performance of its
loan portfolio, as of December 31, 1999, its reserves for loan losses are
adequate to absorb potential loan losses determined on the basis of management's
continuing review and evaluation of the loan portfolio and its judgment as to
the impact of economic conditions on the portfolio.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF FIFTH THIRD
Except as disclosed in (i) the Fifth Third disclosure schedule
delivered to Old Kent prior to the execution of this Agreement (the "Fifth Third
Disclosure Schedule") or (ii) the Fifth Third Reports filed prior to the date
hereof, Fifth Third represents and warrants to Old Kent as follows:
4.1 Corporate Organization. (a) Fifth Third is a corporation
duly organized, validly existing and in good standing under the laws of the
State of Ohio. Fifth Third has the corporate power and authority to own or lease
all of its properties and assets and to carry on its business as it is now being
conducted, and is duly licensed or qualified to do business in each jurisdiction
in which the nature of the business conducted by it or the character or location
of the properties and assets owned or leased by it makes such licensing or
qualification necessary, except where the failure to be so licensed or qualified
would not, either individually or in the aggregate, have a Material Adverse
Effect on Fifth Third. Fifth Third was certified as an FHC under the BHC Act,
and remains a certified FHC on the date hereof. True and complete copies of the
Second Amended Articles of Incorporation (the "Fifth Third Articles") and the
Code of Regulations of Fifth Third, as in effect as of the date of this
Agreement, have previously been made available by Fifth Third to Old Kent.
(b) Each Fifth Third Subsidiary (i) is duly organized and
validly existing under the laws of its jurisdiction of organization, (ii) is
duly qualified to do business and in good standing in all jurisdictions (whether
Federal, state, local or foreign) where its ownership or leasing of property or
the conduct of its business requires it to be so qualified and in which the
failure to be so qualified would have a Material Adverse Effect on Fifth Third,
and (iii) has all requisite corporate power and authority to own or lease its
properties and assets and to carry on its business as now conducted.
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4.2 Capitalization. (a) The authorized capital stock of Fifth
Third consists of 650,000,000 shares of Fifth Third Common Stock, of which, as
of September 30, 2000, no more than 461,800,000 shares were issued and
outstanding, and 500,000 shares of preferred stock, without par value, of which
no shares have been issued by Fifth Third. As of September 30, 2000, no more
than 3,600,000 shares of Fifth Third Common Stock were held in Fifth Third's
treasury. As of the date hereof, no shares of Fifth Third Common Stock or Fifth
Third Preferred Stock were reserved for issuance, except as described in this
Section 4.2(a) and except for 34,472,128 shares reserved for issuance upon
exercise of options issued pursuant to employee and director stock plans of
Fifth Third in effect as of the date hereof (the "Fifth Third Stock Plans"). All
of the issued and outstanding shares of Fifth Third Capital Stock have been duly
authorized and validly issued and are fully paid, nonassessable and free of
preemptive rights, with no personal liability attaching to the ownership
thereof. As of the date of this Agreement, except for this Agreement and the
Fifth Third Stock Plans, Fifth Third does not have and is not bound by any
outstanding subscriptions, options, warrants, calls, commitments or agreements
of any character calling for the purchase or issuance of any shares of Fifth
Third Capital Stock or any other equity securities of Fifth Third or any
securities representing the right to purchase or otherwise receive any shares of
Fifth Third Capital Stock. The shares of Fifth Third Common Stock to be issued
pursuant to the Merger will be duly authorized and validly issued and, at the
Effective Time, all such shares will be fully paid, nonassessable and free of
preemptive rights, with no personal liability attaching to the ownership
thereof.
(b) Fifth Third owns, directly or indirectly, all of the
issued and outstanding shares of capital stock or other equity ownership
interests of each of the Fifth Third Subsidiaries, free and clear of any Liens,
and all of such shares or equity ownership interests are duly authorized and
validly issued and are fully paid, nonassessable (subject to 12 U.S.C. Sections
55) and free of preemptive rights, with no personal liability attaching to the
ownership thereof. No Fifth Third Subsidiary has or is bound by any outstanding
subscriptions, options, warrants, calls, commitments or agreements of any
character calling for the purchase or issuance of any shares of capital stock or
any other equity security of such Subsidiary or any securities representing the
right to purchase or otherwise receive any shares of capital stock or any other
equity security of such Subsidiary.
4.3 Authority, No Violation. (a) Fifth Third has full
corporate power and authority to execute and deliver this Agreement and to
consummate the transactions contemplated hereby. The execution and delivery of
this Agreement and the consummation of the transactions contemplated hereby have
been duly and validly approved by the Board of Directors of Fifth Third by
action of its Executive Committee. The Board of Directors of Fifth Third has
determined that this Agreement and the transactions contemplated hereby are in
the best interests of Fifth Third and its stockholders and has directed that
this Agreement and the transactions contemplated hereby be submitted to Fifth
Third's stockholders for adoption at a duly held meeting of such stockholders
and, except for the approval of this Agreement and the transactions contemplated
hereby, including the approval of the amendment of Fifth Third's Articles
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of Incorporation to authorize the issuance of an additional 300,000,000 shares
of Fifth Third Common Stock (the "Fifth Third Charter Amendment") and the
approval of the issuance of shares of Fifth Third Common Stock pursuant to the
Merger, by the affirmative vote of the holders of a majority of the outstanding
shares of Fifth Third Common Stock voted at such meeting, no other corporate
proceedings on the part of Old Kent are necessary to approve this Agreement or
to consummate the transactions contemplated hereby. This Agreement has been duly
and validly executed and delivered by Fifth Third and (assuming due
authorization, execution and delivery by Old Kent) constitutes valid and binding
obligations of Fifth Third, enforceable against Fifth Third in accordance with
its terms (except as may be limited by bankruptcy, insolvency, moratorium,
reorganization or similar laws affecting the rights of creditors generally and
the availability of equitable remedies).
(b) Neither the execution and delivery of this Agreement by
Fifth Third, nor the consummation by Fifth Third of the transactions
contemplated hereby, nor compliance by Fifth Third with any of the terms or
provisions hereof, will (i) violate any provision of the Fifth Third Articles or
Code of Regulations, or (ii) assuming that the consents and approvals referred
to in Section 4.4 are duly obtained, (x) violate any statute, code, ordinance,
rule, regulation, judgment, writ, or Injunction applicable to Fifth Third, any
of its Subsidiaries or any of their respective properties or assets or (y)
violate, conflict with, result in a breach of any provision of or the loss of
any benefit under, constitute a default (or an event which, with notice or lapse
of time, or both, would constitute a default) under, result in the termination
of or a right of termination or cancellation under, accelerate the performance
required by, or result in the creation of any Lien upon any of the respective
properties or assets of Fifth Third, any of its Subsidiaries under, any of the
terms, conditions or provisions of any note, bond, mortgage, indenture, deed of
trust, license, lease, agreement or other instrument or obligation to which
Fifth Third, any of its Subsidiaries is a party, or by which they or any of
their respective properties or assets may be bound or affected, except (in the
case of clause (y) above) for such violations, conflicts, breaches or defaults
which either individually or in the aggregate will not have a Material Adverse
Effect on Fifth Third.
4.4 Consents and Approvals. Except for (i) the filing of
applications and notices, as applicable, with the Federal Reserve Board under
the BHC Act and the Federal Reserve Act, as amended, and approval of such
applications and notices, (ii) the State Approvals, (iii) the filing with the
SEC of the Joint Proxy Statement and the filing and declaration of effectiveness
of the S-4, (iv) the filing of the Ohio Certificate of Merger with the Secretary
of State of the State of Ohio pursuant to the OGCL and the filing of the
Michigan Certificate of Merger with the appropriate office of the State of
Michigan pursuant to the MBCA, (v) any notices to or filings with the SBA, (vi)
any notices or filings under the HSR Act, (vii) any consents, authorizations,
approvals, filings or exemptions in connection with compliance with the
applicable provisions of federal and state securities laws relating to the
regulation of broker-dealers, investment advisers or transfer agents, and
federal commodities laws relating to the regulation of futures commission
merchants and the rules and regulations thereunder and of any applicable SRO,
and the rules of the NASDAQ, or which are required under consumer
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finance, mortgage banking and other similar laws, (viii) such filings and
approvals as are required to be made or obtained under the securities or "Blue
Sky" laws of various states in connection with the issuance of the shares of
Fifth Third Capital Stock pursuant to this Agreement (ix) such filings and
approvals as are required to be made with or obtained from the OCC and (x) the
approval of this Agreement by the requisite vote of stockholders of Fifth Third,
no consents or approvals of or filings or registrations with any Governmental
Entity are necessary in connection with (A) the execution and delivery by Fifth
Third of this Agreement and (B) the consummation by Fifth Third of the Merger
and the other transactions contemplated hereby.
4.5 Reports. Fifth Third and each of its Subsidiaries have
timely filed all reports, registrations and statements, together with any
amendments required to be made with respect thereto, that they were required to
file since January 1, 1997 with the Regulatory Agencies, and all other reports
and statements required to be filed by them since January 1, 1997, including,
without limitation, any report or statement required to be filed pursuant to the
laws, rules or regulations of the United States, any state, any foreign entity
or any Regulatory Agency, and have paid all fees and assessments due and payable
in connection therewith, except where the failure to file such report,
registration or statement or to pay such fees and assessments, either
individually or in the aggregate, will not have a Material Adverse Effect on
Fifth Third. Except for normal examinations conducted by a Regulatory Agency in
the ordinary course of the business of Fifth Third and its Subsidiaries, no
Regulatory Agency has initiated or has pending any proceeding or, to the best
knowledge of Fifth Third, investigation into the business or operations of Fifth
Third or any of its Subsidiaries since January 1, 1997, except where such
proceedings or investigation will not have, either individually or in the
aggregate, a Material Adverse Effect on Fifth Third. There (i) is no unresolved
violation, criticism, or exception by any Regulatory Agency with respect to any
report or statement relating to any examinations or inspections of Fifth Third
or any of its Subsidiaries, and (ii) has been no formal or informal inquiries
by, or disagreements or disputes with, any Regulatory Agency with respect to the
business, operations, policies or procedures of Fifth Third since January 1,
1997, which, in the reasonable judgment of Fifth Third, will have, either
individually or in the aggregate, a Material Adverse Effect on Fifth Third.
4.6 Financial Statements. Fifth Third has previously provided
to Old Kent copies of (i) the audited consolidated balance sheets of Fifth Third
and its Subsidiaries as of December 31, for the fiscal years 1998 and 1999, and
the related audited consolidated statements of income, changes in stockholders'
equity and cash flows for the fiscal years 1997 through 1999, inclusive (the
"Fifth Third 1999 Financial Information"), as reported in Fifth Third's Annual
Report on Form 10-K for the fiscal year ended December 31, 1999 (the "Fifth
Third 1999 10-K") filed with the SEC under the Exchange Act, accompanied by the
audit report of Deloitte & Touche LLP, independent public accountants with
respect to Fifth Third and (ii) the unaudited consolidated balance sheet of
Fifth Third and its Subsidiaries as of September 30, 1999 and 2000, and the
related consolidated statements of income, changes in shareholders' equity and
cash flows of the nine month periods then ended, as reported in Fifth Third's
Quarterly Report on Form 10-Q for the fiscal period ended September 30, 2000.
The
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December 31, 1999 consolidated balance sheet of Fifth Third (including the
related notes, where applicable) fairly presents in all material respects the
consolidated financial position of Fifth Third and its Subsidiaries as of the
date thereof, and the other financial statements referred to in this Section 4.6
(including the related notes, where applicable) fairly present in all material
respects the results of the consolidated operations and changes in stockholders'
equity and consolidated financial position of Fifth Third and its Subsidiaries
for the respective fiscal periods or as of the respective dates therein set
forth, subject to normal year-end audit adjustments in amounts consistent with
past experience in the case of unaudited statements; each of such statements
(including the related notes, where applicable) complies in all material
respects with applicable accounting requirements and with the published rules
and regulations of the SEC with respect thereto; and each of such statements
(including the related notes, where applicable) has been prepared in all
material respects in accordance with GAAP consistently applied during the
periods involved, except in each case as indicated in such statements or in the
notes thereto. The books and records of Fifth Third and its Subsidiaries have
been, and are being, maintained in all material respects in accordance with GAAP
and any other applicable legal and accounting requirements and reflect only
actual transactions.
4.7 Broker's Fees. Neither Fifth Third nor any Fifth Third
Subsidiary nor any of their respective officers or directors has employed any
broker or finder or incurred any liability for any brokers fees, commissions or
finder's fees other than fees payable to Xxxxxxx Xxxxx Xxxxxx, Inc. in
connection with the Merger or related transactions contemplated by this
Agreement.
4.8 Absence of Certain Changes or Events. (a) Since December
31, 1999, no event or events have occurred which has had, individually or in the
aggregate, a Material Adverse Effect on Fifth Third.
(b) From December 31, 1999 through and including the date
hereof, Fifth Third and the Fifth Third Subsidiaries have carried on their
respective businesses in all material respect in the ordinary course.
4.9 Legal Proceedings. (a) Neither Fifth Third nor any of its
Subsidiaries is a party to any, and there are no pending or, to the best of
Fifth Third's knowledge, threatened, legal, administrative, arbitral or other
proceedings, claims, actions or governmental or regulatory investigations of any
nature against Fifth Third or any of its Subsidiaries or challenging the
validity or propriety of the transactions contemplated by this Agreement as to
which, in any such case, there is a reasonable probability of an adverse
determination and which, if adversely determined, will have, either individually
or in the aggregate, a Material Adverse Effect on Fifth Third.
(b) There is no Injunction, judgment, or regulatory
restriction (other than those of general application that apply to similarly
situated bank holding companies or their Subsidiaries) imposed upon Fifth Third,
any of its Subsidiaries or the assets of Fifth Third or any of its Subsidiaries
that has had or will have, either
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individually or in the aggregate, a Material Adverse Effect on Fifth Third or
the Surviving Corporation.
4.10 Taxes and Tax Returns. Each of Fifth Third and its
Subsidiaries has duly filed all federal, state, foreign and local information
returns and Tax returns required to be filed by it on or prior to the date
hereof (all such returns being accurate and complete in all material respects)
and has duly paid or made provision for the payment of all Taxes and other
governmental charges which have been incurred or are due or claimed to be due
from it by federal, state, foreign or local taxing authorities (including,
without limitation, if and to the extent applicable, those due in respect of its
properties, income, business, capital stock, deposits, franchises, licenses,
sales and payrolls) other than (i) Taxes or other governmental charges which are
not yet delinquent or are being contested in good faith and have not been
finally determined, or (ii) information returns, tax returns, Taxes or other
governmental charges as to which the failure to file, pay or make provision for
will not have, either individually or in the aggregate, a Material Adverse
Effect on Fifth Third. The federal income Tax returns of Fifth Third and its
Subsidiaries have been examined by the IRS through 1990 and any liability with
respect thereto has been satisfied or any liability with respect to deficiencies
asserted as a result of such examination is covered by adequate reserves. There
are no material disputes pending, or claims asserted for, Taxes or assessments
upon Fifth Third or any of its Subsidiaries for which Fifth Third does not have
adequate reserves maintained in accordance with GAAP. Neither Fifth Third nor
any of its Subsidiaries is a party to or is bound by any Tax sharing, allocation
or indemnification agreement or arrangement (other than such an agreement or
arrangement exclusively between or among Fifth Third and its Subsidiaries).
Within the past five years, neither Fifth Third nor any of its Subsidiaries has
been a "distributing corporation" or a "controlled corporation" in a
distribution intended to qualify under Section 355(a) of the Code.
(b) No disallowance of a deduction under Section 162(m) of the
Code for employee remuneration of any amount paid or payable by Fifth Third or
any of its Subsidiaries under any contract, plan, program, arrangement or
understanding would be reasonably likely to have, individually or in the
aggregate, a Material Adverse Effect on Fifth Third.
4.11 SEC Reports. Fifth Third has previously made available to
Old Kent an accurate and complete copy of each (a) final registration statement,
prospectus, report, schedule and definitive proxy statement filed since January
1, 1997 by Fifth Third with the SEC pursuant to the Securities Act or the
Exchange Act (the "Fifth Third Reports") and prior to the date hereof and (b)
communication mailed by Fifth Third to its stockholders since January 1, 1997
and prior to the date hereof, and no such Fifth Third Report or communication,
as of the date thereof, contained any untrue statement of a material fact or
omitted to state any material fact required to be stated therein or necessary in
order to make the statements therein, in light of the circumstances in which
they were made, not misleading, except that information as of a later date (but
before the date hereof) shall be deemed to modify information as of an earlier
date. Since
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January 1, 1997, as of their respective dates, all Fifth Third Reports filed
under the Securities Act and the Exchange Act complied in all material respects
with the published rules and regulations of the SEC with respect thereto.
4.12 Compliance with Applicable Law. (a) Fifth Third and each
of its Subsidiaries hold all material licenses, franchises, permits and
authorizations necessary for the lawful conduct of their respective businesses
under and pursuant to each, and have complied in all material respects with and
are not in default in any material respect under any, applicable law, statute,
order, rule, regulation, policy and/or guideline of any Governmental Entity
relating to Fifth Third or any of its Subsidiaries, except where the failure to
hold such license, franchise, permit or authorization or such noncompliance or
default will not, either individually or in the aggregate, have a Material
Adverse Effect on Fifth Third.
(b) Except as will not have, either individually or in the
aggregate, a Material Adverse Effect on Fifth Third, Fifth Third and each Fifth
Third Subsidiary have properly administered all accounts for which it acts as a
fiduciary, including accounts for which it serves as a trustee, agent,
custodian, personal representative, guardian, conservator or investment advisor,
in accordance with the terms of the governing documents, applicable state and
federal law and regulation and common law. None of Fifth Third, any Fifth Third
Subsidiary, or any director, officer or employee of Fifth Third or of any Fifth
Third Subsidiary, has committed any breach of trust with respect to any such
fiduciary account that will have a Material Adverse Effect on Fifth Third, and
the accountings for each such fiduciary account are true and correct in all
material respects and accurately reflect the assets of such fiduciary account.
4.13 Agreements with Regulatory Agencies. Neither Fifth Third
nor any of its Subsidiaries is subject to any cease-and-desist or other order or
enforcement action issued by, or is a party to any written agreement, consent
agreement or memorandum of understanding with, or is a party to any commitment
letter or similar undertaking to, or is subject to any order or directive by, or
has been since January 1, 1997, a recipient of any supervisory letter from, or
has been ordered to pay any civil money penalty by, or since January 1, 1997,
has adopted any policies, procedures or board resolutions at the request of any
Regulatory Agency or other Governmental Entity that currently restricts in any
material respect the conduct of its business or that in any material manner
relates to its capital adequacy, its ability to pay dividends, its credit or
risk management policies, its management or its business (each, whether or not
set forth in the Fifth Third Disclosure Schedule, a "Fifth Third Regulatory
Agreement"), nor has Fifth Third or any of its Subsidiaries been advised since
January 1, 1997, by any Regulatory Agency or other Governmental Entity that it
is considering issuing, initiating, ordering or requesting any such Fifth Third
Regulatory Agreement.
4.14 Interest Rate Risk Management Instruments. All interest
rate swaps, caps, floors and option agreements and other interest rate risk
management arrangements, whether entered into for the account of Fifth Third or
for the account of a customer of Fifth Third or one of its Subsidiaries, were
entered into in the ordinary
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course of business consistent with past practice and, to Fifth Third's
knowledge, in accordance with prudent banking practice and applicable rules,
regulations and policies of any Regulatory Authority and with counterparties
believed to be financially responsible at the time and are legal, valid and
binding obligations of Fifth Third or one of its Subsidiaries enforceable in
accordance with their terms (except as may be limited by bankruptcy, insolvency,
moratorium, reorganization or similar laws affecting the rights of creditors
generally and the availability of equitable remedies), and are in full force and
effect. Fifth Third and each of its Subsidiaries have duly performed in all
material respects all of their material obligations thereunder to the extent
that such obligations to perform have accrued; and to Fifth Third's knowledge,
there are no material breaches, violations or defaults or allegations or
assertions of such by any party thereunder.
4.15 Undisclosed Liabilities. Except for those liabilities
that are fully reflected or reserved against on the consolidated balance sheet
of Fifth Third included in the Fifth Third 1999 Financial Information and for
liabilities incurred in the ordinary course of business consistent with past
practice since December 31, 1999, since such date, neither Fifth Third nor any
of its Subsidiaries has incurred any liability of any nature whatsoever (whether
absolute, accrued, contingent or otherwise and whether due or to become due)
that, either individually or in the aggregate (including if considered together
with liabilities incurred in the ordinary course of business consistent with
past practice since December 31, 1999), has had or will have, a Material Adverse
Effect on Fifth Third.
4.16 Environmental Liability. There are no legal,
administrative, arbitral or other proceedings, claims, actions, causes of
action, private environmental investigations or remediation activities or
governmental investigations of any nature seeking to impose, or that could
reasonably result in the imposition, on Fifth Third of any liability or
obligation arising under common law or under any local, state or federal
environmental statute, regulation or ordinance including, without limitation,
the Comprehensive Environmental Response, Compensation and Liability Act of
1980, as amended, pending or threatened against Fifth Third, which liability or
obligation will, either individually or in the aggregate, have a Material
Adverse Effect on Fifth Third. To the knowledge of Fifth Third, there is no
reasonable basis for any such proceeding, claim, action or governmental
investigation that would impose any liability or obligation that will,
individually or in the aggregate, have a Material Adverse Effect on Fifth Third.
Fifth Third is not subject to any agreement, order, judgment, decree, letter or
memorandum by or with any Governmental Authority or third party imposing any
liability or obligation with respect to the foregoing that will have, either
individually or in the aggregate, a Material Adverse Effect on Fifth Third.
4.17 Reorganization; Pooling of Interests. As of the date of
this Agreement, Fifth Third has no reason to believe that the Merger will not
qualify as a "reorganization" within the meaning of Section 368(a) of the Code
and as a "pooling of interests" for accounting purposes.
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4.18 Fifth Third Information. The information relating to
Fifth Third and its Subsidiaries to be contained in the Joint Proxy Statement
and the S-4, or the information relating to Fifth Third and its Subsidiaries
that is provided by Fifth Third or its representatives for inclusion in any
other document filed with any other Regulatory Agency in connection herewith,
will not contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements therein, in light of the
circumstances in which they are made, not misleading. The Joint Proxy Statement
(except for such portions thereof that relate only to Old Kent or any of its
Subsidiaries) will comply with the provisions of the Exchange Act and the rules
and regulations thereunder. The S-4 will comply with the provisions of the
Securities Act and the rules and regulations thereunder.
4.19 Loan Losses. Since December 31, 1999, none of the bank
Subsidiaries of Fifth Third (the "Fifth Third Bank Subsidiaries") has incurred
any unusual or extraordinary loan losses which are material to Fifth Third and
the Fifth Third Subsidiaries on a consolidated basis; to the best knowledge of
Fifth Third and in light of each of the Fifth Third Bank Subsidiaries'
historical loan loss experience and its management's analysis of the quality and
performance of its loan portfolio, as of December 31, 1999, its reserves for
loan losses are adequate to absorb potential loan losses determined on the basis
of management's continuing review and evaluation of the loan portfolio and its
judgment as to the impact of economic conditions on the portfolio.
ARTICLE V
COVENANTS RELATING TO CONDUCT OF BUSINESS
5.1 Conduct of Businesses Prior to the Effective Time. During
the period from the date of this Agreement to the Effective Time, except as
expressly contemplated or permitted by this Agreement (including the Old Kent
Disclosure Schedule) or the Old Kent Option Agreement, Old Kent shall, and shall
cause each of its Subsidiaries to, (a) conduct its business in the ordinary
course, (b) use reasonable best efforts to maintain and preserve intact its
business organization, employees and advantageous business relationships and
retain the services of its key officers and key employees and (c) take no action
which would adversely affect or delay the ability of the parties to obtain any
necessary approvals of any Regulatory Agency or other Governmental Entity
required for the transactions contemplated hereby or to perform its covenants
and agreements under this Agreement or the Old Kent Option Agreement or to
consummate the transactions contemplated hereby or thereby.
5.2 Forbearances. During the period from the date of this
Agreement to the Effective Time, except as set forth in the Old Kent Disclosure
Schedule and except as expressly contemplated or permitted by this Agreement,
Old Kent shall not, and shall not permit any of its Subsidiaries to, without the
prior written consent of Fifth Third:
(a) other than in the ordinary course of business consistent
with past practice, incur any indebtedness for borrowed money (other than
short-term
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indebtedness incurred to refinance short-term indebtedness and indebtedness of
Old Kent or any of its wholly owned Subsidiaries to Old Kent or any of its
Subsidiaries), assume, guarantee, endorse or otherwise as an accommodation
become responsible for the obligations of any other individual, corporation or
other entity, or make any loan or advance (it being understood and agreed that
incurrence of indebtedness in the ordinary course of business consistent with
past practice shall include, without limitation, the creation of deposit
liabilities, purchases of Federal funds, sales of certificates of deposit and
entering into repurchase agreements);
(b) (i) adjust, split, combine or reclassify any capital
stock;
(ii) make, declare or pay any dividend, or make any other
distribution on, or directly or indirectly redeem, purchase or otherwise
acquire, any shares of its capital stock or any securities or obligations
convertible (whether currently convertible or convertible only after the passage
of time or the occurrence of certain events) into or exchangeable for any shares
of its capital stock (except (A) for regular quarterly cash dividends at a rate
not in excess of $0.24 per share of Old Kent Common Stock and such dividends as
required by the certificates of designation of the Old Kent Perpetual Preferred
Stock, (B) dividends paid by any of the Subsidiaries of Old Kent to Old Kent or
to any of its wholly owned Subsidiaries and (C) the acceptance of shares of Old
Kent Common Stock as payment of the exercise price of stock options or for
withholding taxes incurred in connection with the exercise of stock options or
the vesting of restricted stock, in each case in accordance with past practice
and the terms of the applicable award agreements);
(iii) grant any stock appreciation rights or grant any
individual, corporation or other entity any right to acquire any shares of its
capital stock, other than (A) pursuant to the Old Kent Rights Agreement or any
renewal or replacement thereof and (B) grants to newly hired employees of Old
Kent (other than officers that will be subject to the reporting requirements of
Section 16(a) of the Exchange Act) made in the ordinary course of business
consistent with past practice under the Old Xxxx Xxxxx Plans and consistent with
the additional terms set forth in Section 5.2 of the Old Kent Disclosure
Schedule; or
(iv) issue any additional shares of capital stock except (A)
pursuant to the exercise of stock options outstanding as of the date hereof or
issued in compliance with Section 5.2(b)(iii), (B) pursuant to the Old Kent
Option Agreement (C) pursuant to the Old Kent Rights Agreement or any renewal or
replacement thereof or (D) upon conversion of the Series D Perpetual Preferred
Stock;
(c) (i) except for normal increases for employees (other than
officers subject to the reporting requirements of Section 16(a) of the Exchange
Act) made in the ordinary course of business consistent with past practice, or
as required by applicable law or agreements disclosed in Section 5.2 of the Old
Kent Disclosure Schedule, increase the wages, salaries, compensation, pension,
or other fringe benefits or perquisites payable to any officer, employee, or
director, or (ii) pay any pension or retirement allowance not required by any
existing plan or agreement or by applicable law, or (iii)
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pay any bonus other than customary year-end bonuses for fiscal 2000 determined
in accordance with Section 5.2 of the Old Kent Disclosure Schedule, or (iv)
become a party to, amend or commit itself to, any pension, retirement,
profit-sharing or welfare benefit plan or agreement or employment agreement with
or for the benefit of any employee other than in the ordinary course of business
consistent with past practice or as required by applicable law, or (v) except as
required under any existing plan, grant, or agreement disclosed in Section 5.2
of the Old Kent Disclosure Schedule, accelerate the vesting of, or the lapsing
of restrictions with respect to, any stock options or other equity-based
compensation, or (vi) except as required by the terms of the plans, make any
contribution to the defined benefit plans maintained by Old Kent or
discretionary contributions to any benefit plans after the date of this
Agreement, or (vii) take any action to amend the defined benefit plans which
would reduce or restrict the availability of surplus (excess of plan assets over
plan liabilities) under any defined benefit plan as defined in Section 414(j) of
the Code;
(d) sell, transfer, mortgage, encumber or otherwise dispose of
any of its material properties or assets to any individual, corporation or other
entity or cancel, release or assign any indebtedness to any such person or any
claims held by any such person, in each case other than in the ordinary course
of business consistent with past practice or as required by applicable law or as
set forth in the Old Kent Disclosure Schedule;
(e) except for transactions in the ordinary course of business
consistent with past practice (other than as set forth in Section 5.2 of the Old
Kent Disclosure Schedule), make any material investment either by purchase of
stock or securities, contributions to capital, property transfers, or purchase
of any property or assets of any other individual, corporation or other entity;
(f) except for transactions in the ordinary course of business
consistent with past practice, terminate, or waive any material provision of any
Old Kent Contract or make any change in any instrument or agreement governing
the terms of any of its securities, or material lease or contract, other than
normal renewals of contracts and leases without material adverse changes of
terms;
(g) solicit or encourage from any third party or enter into or
continue any negotiations, discussions or agreement in respect of, or authorize
any individual, corporation or other entity to solicit or encourage from any
third party or enter into or continue any negotiations, discussions or
agreements in respect of, or provide or cause to be provided any confidential
information in connection with, any inquiries or proposals relating to the
disposition of all or significant portion of its business or assets, the
acquisition of 15% or more of its voting securities, or the merger,
consolidation or similar business combination transaction involving it or any of
its Subsidiaries with any corporation or other entity, other than as provided by
this Agreement (and Old Kent shall promptly (within 24 hours) notify Fifth Third
of all of the relevant details relating to all inquiries and proposals which it
may receive relating to any of such matters), or
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waive or amend any provision of the Old Kent Rights Agreement or any applicable
confidentiality agreement in respect of any such proposal;
(h) settle any claim, action or proceeding requiring Old Kent
or any of its Subsidiaries to pay (whether or not such payments would be covered
in whole or in part by insurance) any monetary damages in excess of $500,000 or
subjecting Old Kent or any of its Subsidiaries to any restrictions (other than
immaterial restrictions) on its current or future business or operations
(including the future business and operations of the Surviving Corporation);
(i) knowingly take any action, or knowingly fail to take any
action, that is reasonably likely to (A) jeopardize the treatment of the Merger
as a "pooling of interests" for accounting purposes (including by terminating
and electing to pay cash for any option to purchase Old Kent Common Stock as may
be permitted under the Old Xxxx Xxxxx Plans or otherwise) or (B) prevent or
impede the Merger from qualifying as a reorganization within the meaning of
Section 368 of the Code;
(j) amend its articles of incorporation, its bylaws or
comparable governing documents, or amend, or redeem the rights issued under, the
Old Kent Rights Agreement (except as required hereunder), or otherwise take any
action to exempt any person or entity (other than Fifth Third or its
Subsidiaries) or any action taken by such person or entity from the Old Kent
Rights Agreement or any Takeover Statute or similarly restrictive provisions of
such party's organizational documents or terminate, amend or waive any
provisions of any confidentiality or standstill agreements in place with any
third parties;
(k) other than in prior consultation with the other party to
this Agreement, restructure or materially change its investment securities
portfolio or its gap position, through purchases, sales or otherwise, or the
manner in which the portfolio is classified or reported;
(l) take any action that is intended or is reasonably likely
to result in any of the conditions to the Merger set forth in Article VII not
being satisfied or in a material violation of any provision of this Agreement,
except, in every case, as may be required by applicable law;
(m) implement or adopt any change in its accounting
principles, practices or methods, other than as may be required by GAAP or
regulatory guidelines;
(n) file or amend any Tax return other than in the ordinary
course of business, make or change any material Tax election, settle or
compromise any material Tax liability or, except as required by applicable law,
change any method of accounting for Tax purposes;
(o) take any action that would materially impede or delay the
ability of the parties to obtain any necessary approvals of any Regulatory
Agency or
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Governmental Entity required for the transaction, contemplated hereby or by the
Old Kent Option Agreement; or
(p) agree to take, make any commitment to take, or adopt any
resolutions of its board of directors in support of, any of the actions
prohibited by this Section 5.2.
5.3 Fifth Third Forbearances. During the period from the date
of this Agreement to the Effective Time, except as expressly contemplated or
permitted by this Agreement, Fifth Third shall not, and shall not permit any of
its Subsidiaries to, without the prior written consent of Old Kent, (i) amend
the Fifth Third Articles or Fifth Third Code of Regulations in a manner that
would adversely affect the economic benefits of the Merger to the Old Kent
stockholders, (ii) knowingly take any action, or knowingly fail to take any
action, that is reasonably likely to (A) jeopardize the treatment of the Merger
as a "pooling of interests" for accounting purposes or (B) prevent or impede the
Merger from qualifying as a reorganization within the meaning of Section 368 of
the Code (provided that nothing contained herein shall limit the ability of
Fifth Third to exercise its rights under the Old Kent Option Agreement), (iii)
take any action which would materially impede or delay the ability of the
parties to obtain any necessary approvals of any Regulatory Agency or other
Governmental Entity required for the transactions contemplated hereby, (iv) take
any action that is intended or is reasonably likely to result in any of the
conditions to the Merger set forth in Article VII not being satisfied or in a
material violation of any provision of this Agreement, except, in every case, as
may be required by applicable law or (v) agree to take, make any commitment to
take, or adopt any resolutions of its board of directors in support of, any of
the actions prohibited by this Section 5.3.
ARTICLE VI
ADDITIONAL AGREEMENTS
6.1 Regulatory Matters. (a) Fifth Third and Old Kent shall
promptly prepare and file with the SEC the Joint Proxy Statement and Fifth Third
shall promptly prepare and file with the SEC the S-4, in which the Joint Proxy
Statement will be included as a prospectus. Each of Fifth Third and Old Kent
shall use their reasonable best efforts to have the S-4 declared effective under
the Securities Act as promptly as practicable after such filing, and Fifth Third
and Old Kent shall thereafter mail or deliver the Joint Proxy Statement to their
respective stockholders. Fifth Third shall also use its reasonable best efforts
to obtain all necessary state securities law or "Blue Sky" permits and approvals
required to carry out the transactions contemplated by this Agreement, and Old
Kent shall furnish all information concerning Old Kent and the holders of Old
Kent Capital Stock as may be reasonably requested in connection with any such
action.
(b) The parties hereto shall cooperate with each other and use
their reasonable best efforts to promptly prepare and file all necessary
documentation, to effect all applications, notices, petitions and filings, to
obtain as promptly as practicable
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all permits, consents, approvals and authorizations of all third parties and
Governmental Entities which are necessary or advisable to consummate the
transactions contemplated by this Agreement (including, without limitation, the
Merger), and to comply with the terms and conditions of all such permits,
consents, approvals and authorizations of all such Governmental Entities. Fifth
Third and Old Kent shall have the right to review in advance, and, to the extent
practicable, each will consult the other on, in each case subject to applicable
laws relating to the exchange of information, all the information relating to
Old Kent or Fifth Third, as the case may be, and any of their respective
Subsidiaries, which appear in any filing made with, or written materials
submitted to, any third party or any Governmental Entity in connection with the
transactions contemplated by this Agreement. In exercising the foregoing right,
each of the parties hereto shall act reasonably and as promptly as practicable.
The parties hereto agree that they will consult with each other with respect to
the obtaining of all permits, consents, approvals and authorizations of all
third parties and Governmental Entities necessary or advisable to consummate the
transactions contemplated by this Agreement and each party will keep the other
apprised of the status of matters relating to completion of the transactions
contemplated herein.
(c) Fifth Third and Old Kent shall, upon request, furnish each
other with all information concerning themselves, their Subsidiaries, directors,
officers and stockholders and such other matters as may be reasonably necessary
or advisable in connection with the Joint Proxy Statement, the S-4 or any other
statement, filing, notice or application made by or on behalf of Fifth Third,
Old Kent or any of their respective Subsidiaries to any Governmental Entity in
connection with the Merger and the other transactions contemplated by this
Agreement.
(d) Fifth Third and Old Kent shall promptly advise each other
upon receiving any communication from any Governmental Entity whose consent or
approval is required for consummation of the transactions contemplated by this
Agreement that causes such party to believe that there is a reasonable
likelihood that any Requisite Regulatory Approval will not be obtained or that
the receipt of any such approval will be materially delayed.
6.2 Access to Information. (a) Upon reasonable notice and
subject to applicable laws relating to the exchange of information, the parties
shall, and shall cause each of its Subsidiaries to, afford to the officers,
employees, accountants, counsel and other representatives of the other party,
access, during normal business hours during the period prior to the Effective
Time, to all its properties, books, contracts, commitments and records, and,
during such period, the parties shall, and shall cause its Subsidiaries to, make
available to the other party (i) a copy of each report, schedule, registration
statement and other document filed or received by it during such period pursuant
to the requirements of federal securities laws or federal or state banking laws
(other than reports or documents which such party is not permitted to disclose
under applicable law) and (ii) all other information concerning its business,
properties and personnel as the other party may reasonably request. None of the
parties nor any of their Subsidiaries shall be required to provide access to or
to disclose information where
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such access or disclosure would jeopardize the attorney-client privilege of such
party or its Subsidiaries or contravene any law, rule, regulation, order,
judgment, decree, fiduciary duty or binding agreement entered into prior to the
date of this Agreement. The parties hereto will make appropriate substitute
disclosure arrangements under circumstances in which the restrictions of the
preceding sentence apply.
(b) Except as provided in Section 9.9, each party to this
Agreement shall hold, and shall cause its respective Subsidiaries and its and
its Subsidiaries' directors, officers, employees, agents, consultants and
advisors to hold, all information furnished by or on behalf of the other party
or any of such party's Subsidiaries or representatives pursuant to Section
6.2(a) in confidence to the extent required by, and in accordance with, the
provisions of the confidentiality agreement, dated November 14, 2000, between
the parties.
(c) No investigation by either of the parties or their
respective representatives shall affect the representations and warranties of
the other set forth herein.
6.3 Stockholder Approval. Each of Fifth Third and Old Kent
shall call a meeting of its stockholders to be held on March 20, 2001 (the date
of the annual meeting of the stockholders of Fifth Third), or as soon thereafter
as reasonably practicable, for the purpose of voting upon the requisite
stockholder approvals required in connection with this Agreement and the Merger,
and each shall use its reasonable best efforts to cause such meetings to occur
on such date. The Board of Directors of each of Fifth Third and Old Kent shall
use its reasonable best efforts to obtain from the stockholders of Fifth Third
and Old Kent, as the case may be, the vote in favor of the adoption of this
Agreement required by the MBCA, in the case of Old Kent, and in favor of the
adoption of this Agreement required by the OGCL, the Fifth Third Charter
Amendment and the issuance of shares of Fifth Third Common Stock pursuant to the
Merger, in the case of Fifth Third (it being understood and agreed that the
obligations under this sentence shall not be altered by the commencement,
proposal, disclosure or communication of any Acquisition Transaction (as defined
in the Old Kent Option Agreement)).
6.4 Legal Conditions to Merger. Each of Fifth Third and Old
Kent shall, and shall cause its Subsidiaries to, use their reasonable best
efforts (a) to take, or cause to be taken, all actions necessary, proper or
advisable to comply promptly with all legal requirements that may be imposed on
such party or its Subsidiaries with respect to the Merger and, subject to the
conditions set forth in Article VII hereof, to consummate the transactions
contemplated by this Agreement, and (b) to obtain (and to cooperate with the
other party to obtain) any material consent, authorization, order or approval
of, or any exemption by, any Governmental Entity and any other third party that
is required to be obtained by Old Kent or Fifth Third or any of their respective
Subsidiaries in connection with the Merger and the other transactions
contemplated by this Agreement.
6.5 Affiliates; Publication of Combined Financial Results. (a)
Each of Fifth Third and Old Kent shall use its reasonable best efforts to cause
each director,
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executive officer and other person who is an "affiliate" (for purposes of Rule
145 under the Securities Act and for purposes of qualifying the Merger for
"pooling of interests" accounting treatment) of such party to deliver to the
other party hereto, as soon as practicable after the date of this Agreement, and
prior to the date of the stockholders' meeting called by Old Kent to approve
this Agreement, a written agreement, in the form of Exhibit 6.5(a)(1) or (2), as
applicable, hereto.
(b) The Surviving Corporation shall use its best efforts to
publish as promptly as reasonably practical, but in no event later than July 31,
2001, combined sales and net income figures as contemplated by and in accordance
with the terms of SEC Accounting Series Release No. 135.
6.6 Stock Exchange Listing. Fifth Third shall cause the shares
of Fifth Third Common Stock, to be issued in the Merger to be approved for
listing on the NASDAQ, subject to official notice of issuance, prior to the
Effective Time.
6.7 Employee Benefit Plans. (a) Until December 31, 2001, the
benefits to be provided to employees of Old Kent and its Subsidiaries as of the
Effective Time ("Covered Employees") shall be substantially similar, in the
aggregate, to the benefits provided under the benefit plans and programs
provided by Old Kent or its Subsidiaries, as the case may be, to such employees
as of the date hereof. From and after December 31, 2001, the benefits to be
provided to the Covered Employees shall be the benefit plans (other than Fifth
Third's defined benefit pension plan which has been frozen) and programs
provided to similarly situated employees of Fifth Third. Fifth Third shall, from
and after the Effective Time, (i) comply with Old Kent Benefit Plans and other
contractual commitments of Old Kent to its current and former employees in
accordance with their terms and honor all employee benefit obligations to
current and former employees of Old Kent and its Subsidiaries under Old Kent
Benefit Plans or the applicable contractual commitment, (ii) provide Covered
Employees credit for the most recent period of uninterrupted service (including
any bridging or prior service credit, without regard to whether there has been
an interruption in service, solely to the extent provided by Old Kent and its
Subsidiaries as of the date hereof) with Old Kent or any of its Subsidiaries
(and their predecessors) prior to the Effective Time under employee benefit
plans of Fifth Third or its Subsidiaries (other than Fifth Third's
noncontributory cash balance defined benefit pension plan), (iii) cause any and
all pre-existing condition limitations (to the extent such limitations did not
apply to a pre-existing condition under comparable Old Kent Plans) and
eligibility waiting periods under group health plans of Fifth Third to be waived
with respect to Covered Employees (and their eligible dependents) who become
participants in such group health plans and (iv) assume, or cause its applicable
Subsidiary to assume, all contracts and agreements with employees of Old Kent,
which agreements were entered into prior to the date hereof and which are listed
on Section 5.2 of the Old Kent Disclosure Schedule, and all obligations
thereunder. From and after the Effective Time until December 31, 2001, Fifth
Third shall honor all vacation and paid time off of the Covered Employees
accrued as of the Effective Time, in accordance with Old Kent policy as in
effect on the date hereof. From and after the Effective Time, a Covered Employee
who is terminated (as defined in the
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applicable Old Xxxx xxxxxxxxx plan or policy as in effect on the date hereof)
during the period commencing at the Effective Time and ending on the 12-month
anniversary thereof shall be entitled to receive the greater of (i) the
severance payments and benefits under the applicable Old Xxxx xxxxxxxxx plan or
policy as in effect on the date hereof (without amendment on or after the
Effective Time) and (ii) the severance payments and benefits under Fifth Third's
severance plan or policy as in effect on the date of termination of such Covered
Employee.
(b) Nothing in this Section 6.7 shall be interpreted as
preventing the Surviving Corporation or Fifth Third from amending, modifying or
terminating any Fifth Third Benefit Plans or other contracts, arrangements,
commitments or understandings, in accordance with their terms and applicable
law.
6.8 Indemnification; Directors' and Officers' Insurance. (a)
In the event of any threatened or actual claim, action, suit, proceeding or
investigation, whether civil, criminal or administrative, including, without
limitation, any such claim, action, suit, proceeding or investigation in which
any individual who is now, or has been at any time prior to the date of this
Agreement, or who becomes prior to the Effective Time, a director or officer or
employee of Old Kent or any of its Subsidiaries (the "Indemnified Parties"), is,
or is threatened to be, made a party based in whole or in part on, or arising in
whole or in part out of, or pertaining to (i) the fact that he is or was a
director, officer or employee of Old Kent or any of its Subsidiaries or (ii)
this Agreement, the Old Kent Option Agreement or any of the transactions
contemplated hereby or thereby, whether in any case asserted or arising before
or after the Effective Time, the parties hereto agree to cooperate and use their
best efforts to defend against and respond thereto. It is understood and agreed
that after the Effective Time, Fifth Third shall indemnify and hold harmless, as
and to the fullest extent provided by applicable law, the Old Kent Articles, the
Old Kent Bylaws and any agreement existing as of the date hereof, each such
Indemnified Party against any losses, claims, damages, liabilities, costs,
expenses (including reimbursement for reasonable fees and expenses incurred in
advance of the final disposition of any claim, suit, proceeding or investigation
to each Indemnified Party as provided by the Old Kent Articles, the Old Kent
Bylaws and any agreement existing as of the date hereof), judgments, fines and
amounts paid in settlement in connection with any such threatened or actual
claim, action, suit, proceeding or investigation.
(b) Fifth Third shall use its reasonable best efforts to cause
the individuals serving as officers and directors of Old Kent or any of its
Subsidiaries immediately prior to the Effective Time to be covered for a period
of six (6) years from the Effective Time by the directors' and officers'
liability insurance policy maintained by Old Kent (provided that Fifth Third may
substitute therefor policies of at least the same coverage and amounts
containing terms and conditions which are not less advantageous than such
policy) with respect to acts or omissions occurring prior to the Effective Time
which were committed by such officers and directors in their capacity as such;
provided that in no event shall Fifth Third be required to expend in any one
year an amount in excess of 200% of the annual premiums currently paid by Old
Kent (which current
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amount is set forth in Section 6.8 of the Old Kent Disclosure Schedule) for such
insurance (the "Insurance Amount"), and provided further that if Fifth Third is
unable to maintain such policy (or such substitute policy) as a result of the
preceding proviso, Fifth Third shall use its reasonable best efforts to obtain
as much comparable insurance as is available for the Insurance Amount.
(c) The provisions of this Section 6.8 shall survive the
Effective Time and are intended to be for the benefit of, and shall be
enforceable by, each Indemnified Party and his or her heirs and representatives.
6.9 Additional Agreements. In case at any time after the
Effective Time any further action is necessary or desirable to carry out the
purposes of this Agreement (including, without limitation, any merger between a
Subsidiary of Fifth Third, on the one hand, and a Subsidiary of Old Kent, on the
other) or to vest the Surviving Corporation with full title to all properties,
assets, rights, approvals, immunities and franchises of any of the parties to
the Merger, the proper officers and directors of each party to this Agreement
and their respective Subsidiaries shall take all such necessary action as may be
reasonably requested by, and at the sole expense of, Fifth Third.
6.10 Advice of Changes. Fifth Third and Old Kent shall each
promptly advise the other party of any change or event (i) having a Material
Adverse Effect on it or (ii) which it believes would or would be reasonably
likely to cause or constitute a material breach of any of its representations,
warranties or covenants contained herein.
6.11 Dividends. After the date of this Agreement, each of
Fifth Third and Old Kent shall coordinate with the other the declaration of any
dividends in respect of Fifth Third Common Stock and Old Kent Common Stock and
the record dates and payment dates relating thereto, it being the intention of
the parties hereto that holders of Old Kent Common Stock shall not receive two
dividends, or fail to receive one dividend, for any quarter with respect to
their shares of Old Kent Common Stock and any shares of Fifth Third Common Stock
any such holder receives in exchange therefor in the Merger (such holders to
receive four dividends during 2001).
6.12 Exemption from Liability Under Section 16(b). Assuming
that Old Kent delivers to Fifth Third the Section 16 Information (as defined
below) in a timely fashion, the Board of Directors of Fifth Third, or a
committee of Non-Employee Directors thereof (as such term is defined for
purposes of Rule 16b-3(d) under the Exchange Act), shall adopt a resolution
providing that the receipt by Old Kent Insiders of Fifth Third Common Stock in
exchange for shares of Old Kent Common Stock, and of options on Fifth Third
Common Stock upon conversion of options on Old Kent Common Stock, in each case
pursuant to the transactions contemplated hereby and to the extent such
securities are listed in the Section 16 Information, are intended to be exempt
from liability pursuant to Section 16(b) under the Exchange Act. "Section 16
Information" shall mean information accurate in all respects regarding Old Kent
Insiders, the number of shares of Old Kent Common Stock held by each such Old
Kent Insider and expected to be exchanged for Fifth Third Common Stock in the
Merger, and the number and description of the options on Old Kent Common Stock
held by each such Old Kent
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Insider and expected to be converted into options on Fifth Third Common Stock in
connection with the Merger. The "Old Kent Insiders" shall mean those officers
and directors of Old Kent who are subject to the reporting requirements of
Section 16(a) of the Exchange Act and who are listed in the Section 16
Information.
6.13 Directorships. Fifth Third shall take such actions as may
be reasonably required to cause its Board of Directors to be expanded by three
members and to appoint three members of Old Kent's Board of Directors to the
Fifth Third Board of Directors. In addition, Fifth Third shall extend offers to
all individuals who are members of the Board of Directors of Old Kent
immediately prior to the Effective Time to become members of the Board of
Directors of Fifth Third's principal bank located in Michigan (or any successor
thereto) immediately after the Effective Time.
6.14 Aggregate Capitalization. Old Kent will not take any
action, or fail to take any action, that results in the aggregate number of
shares of Old Kent Common Stock outstanding immediately prior to the Effective
Time (including all shares of Old Kent Common Stock subject to Old Kent Rights
other than the Old Kent Option Agreement, but not including shares of Old Kent
Common Stock held in treasury) exceeding 150,000,000.
6.15 Community Commitments. From and after the Effective Time,
Fifth Third shall maintain the community commitments undertaken by Old Kent Bank
Subsidiaries prior to the date hereof and set forth in Section 6.15 of the Old
Kent Disclosure Schedule in the communities currently served by such banks.
6.16 Executive Benefit Trust. Notwithstanding anything to the
contrary, as soon as practicable after the execution of this Agreement, Old Kent
will take such actions as required under the terms of the Old Kent Executive
Severance Agreements and other executive non-qualified deferred compensation
plans, including, but not limited to, the funding of the Old Kent Financial
Corporation Executive Benefit Trust (a rabbi trust) as required in such
agreements, to the extent not already funded.
ARTICLE VII
CONDITIONS PRECEDENT
7.1 Conditions to Each Party's Obligation To Effect the
Merger. The respective obligations of the parties to effect the Merger shall be
subject to the satisfaction at or prior to the Effective Time of the following
conditions:
(a) Stockholder Approvals. This Agreement shall have been
adopted by the requisite affirmative vote of the holders of Old Kent Common
Stock entitled to vote thereon and the requisite affirmative vote of the holders
of Fifth Third Common Stock entitled to vote thereon.
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(b) NASDAQ Listing. The shares of Fifth Third Common Stock
which shall be issued to the stockholders of Old Kent upon consummation of the
Merger shall have been authorized for listing on the NASDAQ, subject to official
notice of issuance.
(c) Regulatory Approvals. All regulatory approvals required to
consummate the transactions contemplated hereby, including the Merger, shall
have been obtained and shall remain in full force and effect and all statutory
waiting periods in respect thereof shall have expired (all such approvals and
the expiration of all such waiting periods being referred to herein as the
"Requisite Regulatory Approvals").
(d) S-4. The S-4 shall have become effective under the
Securities Act and no stop order suspending the effectiveness of the S-4 shall
have been issued and no proceedings for that purpose shall have been initiated
or threatened by the SEC.
(e) No Injunctions or Restraints; Illegality. No order,
injunction or decree issued by any court or agency of competent jurisdiction or
other legal restraint or prohibition (an "Injunction") preventing the
consummation of the Merger or any of the other transactions contemplated by this
Agreement shall be in effect. No statute, rule, regulation, order, Injunction or
decree shall have been enacted, entered, promulgated or enforced by any
Governmental Entity which prohibits, materially restricts or makes illegal
consummation of the Merger.
(f) Federal Tax Opinion. The parties hereto shall have
received the opinions of their respective counsel, Cleary, Gottlieb, Xxxxx &
Xxxxxxxx and Wachtell, Lipton, Xxxxx & Xxxx, in form and substance reasonably
satisfactory to Fifth Third and Old Kent, as the case may be, dated as of the
Closing Date, substantially to the effect that, on the basis of facts,
representations and assumptions set forth in each such opinion which are
consistent with the state of facts existing at the Effective Time, the Merger
will be treated as a reorganization within the meaning of Section 368(a) of the
Code. In rendering such opinions, counsel may require and rely upon
representations contained in certificates of officers of Fifth Third, Old Kent
and others, reasonably satisfactory in form and substance to such counsel.
(g) Pooling of Interests. Fifth Third and Old Kent shall each
have received a letter from their respective independent accountants addressed
to Old Kent or Fifth Third, as the case may be, to the effect that the Merger
will qualify for "pooling of interests" accounting treatment.
7.2 Conditions to Obligations of Fifth Third. The obligation
of Fifth Third to effect the Merger is also subject to the satisfaction, or
waiver by Fifth Third, at or prior to the Effective Time, of the following
conditions:
(a) Representations and Warranties. The representations and
warranties of Old Kent set forth in this Agreement shall be true and correct in
all material respects as of the date of this Agreement and (except to the extent
such representations and warranties speak as of an earlier date) as of the
Closing Date as though made on and as of the Closing Date; provided, however,
that for purposes of this
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paragraph, such representations and warranties shall be deemed to be true and
correct unless the failure or failures of such representations and warranties to
be so true and correct, either individually or in the aggregate, and without
giving effect to any qualification as to materiality or Material Adverse Effect
set forth in such representations or warranties, will have or are reasonably
likely to have a Material Adverse Effect on Old Kent or the Surviving
Corporation. Fifth Third shall have received a certificate signed on behalf of
Old Kent by the Chief Executive Officer and the Chief Financial Officer of Old
Kent to the foregoing effect.
(b) Performance of Obligations of Old Kent. Old Kent shall
have performed in all material respects all obligations required to be performed
by it under this Agreement at or prior to the Closing Date, and Fifth Third
shall have received a certificate signed on behalf of Old Kent by the Chief
Executive Officer and the Chief Financial Officer of Old Kent to such effect.
7.3 Conditions to Obligations of Old Kent. The obligation of
Old Kent to effect the Merger is also subject to the satisfaction or waiver by
Old Kent at or prior to the Effective Time of the following conditions:
(a) Representations and Warranties. The representations and
warranties of Fifth Third set forth in this Agreement shall be true and correct
in all material respects as of the date of this Agreement and (except to the
extent such representations and warranties speak as of an earlier date) as of
the Closing Date as though made on and as of the Closing Date; provided,
however, that for purposes of this paragraph, such representations and
warranties shall be deemed to be true and correct unless the failure or failures
of such representations and warranties to be so true and correct, either
individually or in the aggregate, and without giving effect to any qualification
as to materiality or Material Adverse Effect set forth in such representations
or warranties, will have or are reasonably likely to have a Material Adverse
Effect on Fifth Third. Old Kent shall have received a certificate signed on
behalf of Fifth Third by the Chief Executive Officer and the Chief Financial
Officer of Fifth Third to the foregoing effect.
(b) Performance of Obligations of Fifth Third. Fifth Third
shall have performed in all material respects all obligations required to be
performed by it under this Agreement at or prior to the Closing Date, and Old
Kent shall have received a certificate signed on behalf of Fifth Third by the
Chief Executive Officer and the Chief Financial Officer of Fifth Third to such
effect.
ARTICLE VIII
TERMINATION AND AMENDMENT
8.1 Termination. This Agreement may be terminated at any time
prior to the Effective Time, whether before or after approval of the matters
presented in connection with the Merger by the stockholders of Old Kent and
Fifth Third:
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(a) by mutual consent of Fifth Third and Old Kent in a written
instrument, if the Board of Directors of each so determines by a vote of a
majority of the members of its entire Board;
(b) by either the Board of Directors of Fifth Third or the
Board of Directors of Old Kent if any Governmental Entity that must grant a
Requisite Regulatory Approval has denied approval of the Merger and such denial
has become final and nonappealable or any Governmental Entity of competent
jurisdiction shall have issued a final nonappealable order permanently enjoining
or otherwise prohibiting the consummation of the transactions contemplated by
this Agreement;
(c) by either Fifth Third or Old Kent if the approval of Fifth
Third's stockholders or Old Kent's stockholders required for the consummation of
the Merger and the other transactions contemplated hereby shall not have been
obtained by reason of the failure to obtain the required vote at the meetings of
the stockholders contemplated by Section 6.3, or at any adjournment or
postponement thereof at which a vote was taken;
(d) by either the Board of Directors of Fifth Third or the
Board of Directors of Old Kent if the Merger shall not have been consummated on
or before the first anniversary of the date hereof unless the failure of the
Closing to occur by such date shall be due to the failure of the party seeking
to terminate this Agreement to perform or observe the covenants and agreements
of such party set forth herein; or
(e) by either the Board of Directors of Fifth Third or the
Board of Directors of Old Kent (provided that the terminating party is not then
in breach of any representation, warranty, covenant or other agreement contained
herein) if there shall have been a breach of any of the covenants or agreements
or any of the representations or warranties set forth in this Agreement on the
part of Old Kent, in the case of a termination by Fifth Third, or Fifth Third,
in the case of a termination by Old Kent, which breach, either individually or
in the aggregate, would constitute, if occurring or continuing on the Closing
Date, the failure of the conditions set forth in Section 7.2 or 7.3, as the case
may be, and which is not cured within 45 days following written notice to the
party committing such breach or by its nature or timing cannot be cured prior to
the Closing Date.
8.2 Effect of Termination. In the event of termination of this
Agreement by either Fifth Third or Old Kent as provided in Section 8.1, this
Agreement shall forthwith become void and have no effect, and none of Fifth
Third, Old Kent, any of their respective Subsidiaries or any of the officers or
directors of any of them shall have any liability of any nature whatsoever
hereunder, or in connection with the transactions contemplated hereby, except
that (i) Sections 6.2(b), 8.2, 9.2 and 9.3 shall survive any termination of this
Agreement, and (ii) notwithstanding anything to the contrary contained in this
Agreement, neither Fifth Third nor Old Kent shall be relieved or released from
any liabilities or damages arising out of its willful breach of any provision of
this Agreement.
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8.3 Amendment. Subject to compliance with applicable law and
Section 1.1(b), this Agreement may be amended by the parties hereto, by action
taken or authorized by their respective Boards of Directors, at any time before
or after approval of the matters presented in connection with the Merger by the
stockholders of Old Kent or Fifth Third, as the case may be. This Agreement may
not be amended except by an instrument in writing signed on behalf of each of
the parties hereto. The parties shall comply with the undertakings set forth in
Section 8.3 of the Old Kent Disclosure Schedule.
8.4 Extension; Waiver. Subject to compliance with applicable
law, at any time prior to the Effective Time, the parties hereto, by action
taken or authorized by their respective Board of Directors, may (a) extend the
time for the performance of any of the obligations or other acts of the other
parties hereto, (b) waive any inaccuracies in the representations and warranties
contained herein or in any document delivered pursuant hereto and (c) waive
compliance with any of the agreements or conditions contained herein. Any
agreement on the part of a party hereto to any such extension or waiver shall be
valid only if set forth in a written instrument signed on behalf of such party,
but such extension or waiver or failure to insist on strict compliance with an
obligation, covenant, agreement or condition shall not operate as a waiver of,
or estoppel with respect to, any subsequent or other failure.
ARTICLE IX
GENERAL PROVISIONS
9.1 Closing. Subject to the terms and conditions of this
Agreement, the closing of the Merger (the "Closing") will take place at a place
to be specified by the parties, at 10:00 a.m. on a date which shall be the first
business day occurring at least ten business days after the satisfaction or
waiver (subject to applicable law) of the latest to occur of the conditions set
forth in Article VII hereof (other than those conditions that by their nature
are required to be satisfied or waived at the Closing), or as otherwise mutually
agreed by the parties (the "Closing Date"). The parties agree to use their
reasonable best efforts to cause the Closing Date to occur during the first week
of April, 2001.
9.2 Nonsurvival of Representations, Warranties and Agreements.
None of the representations, warranties, covenants and agreements in this
Agreement or in any instrument delivered pursuant to this Agreement (other than
the Old Kent Option Agreement, which shall terminate in accordance with its
terms) shall survive the Effective Time, except for Section 6.8 and for those
other covenants and agreements contained herein and therein which by their terms
apply or are to be performed in whole or in part after the Effective Time.
9.3 Expenses. All costs and expenses incurred in connection
with this Agreement and the transactions contemplated hereby shall be paid by
the party incurring such expense, provided, however, that the costs and expenses
of printing and
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mailing the Joint Proxy Statement, and all filing and other fees paid to the SEC
in connection with the Merger, shall be borne equally by Fifth Third and Old
Kent.
9.4 Notices. All notices and other communications hereunder
shall be in writing and shall be deemed given if delivered personally,
telecopied (with confirmation), mailed by registered or certified mail (return
receipt requested) or delivered by an express courier (with confirmation) to the
parties at the following addresses (or at such other address for a party as
shall be specified by like notice):
(a) if to Fifth Third, to:
Fifth Third Bancorp
00 Xxxxxxxx Xxxxxx Xxxxx
Xxxxxxxxxx, Xxxx 00000
Attention: General Counsel
Telecopier: (000) 000-0000
with a copy to:
Cleary, Gottlieb, Xxxxx & Xxxxxxxx
Xxx Xxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxx, Esq.
Xxxx X. Xxxx, Esq.
Telecopier: (000) 000-0000
and
(b) if to Old Kent, to:
Old Kent Financial Corporation
000 Xxxx Xxxxxx, XX
Xxxxx Xxxxxx, Xxxxxxxx 00000
Attention: Senior Vice President and Legal Coordinator
Telecopier: 000-000-0000
with a copy to:
Wachtell, Lipton, Xxxxx & Xxxx
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxxx, Esq.
Telecopier: (000) 000-0000
9.5 Interpretation. When a reference is made in this Agreement
to Sections, Exhibits or Schedules, such reference shall be to a Section of or
Exhibit or
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Schedule to this Agreement unless otherwise indicated. The table of contents and
headings contained in this Agreement are for reference purposes only and shall
not affect in any way the meaning or interpretation of this Agreement. Whenever
the words "include," "includes" or "including" are used in this Agreement, they
shall be deemed to be followed by the words "without limitation." Nothing
contained herein shall require any party hereto or the Board of Directors of
such party to take or refrain from taking any action in violation of applicable
law. The Old Kent Disclosure Schedule and the Fifth Third Disclosure Schedule,
as well as all other schedules and all exhibits hereto, shall be deemed part of
this Agreement and included in any reference to this Agreement.
9.6 Counterparts. This Agreement may be executed in
counterparts, all of which shall be considered one and the same agreement and
shall become effective when counterparts have been signed by each of the parties
and delivered to the other parties, it being understood that all parties need
not sign the same counterpart.
9.7 Entire Agreement. This Agreement (including the documents
and the instruments referred to herein) together with the Old Kent Option
Agreement constitutes the entire agreement and supersedes all prior agreements
and understandings, both written and oral, among the parties with respect to the
subject matter hereof.
9.8 Governing Law. This Agreement shall be governed and
construed in accordance with the laws of the State of New York, without regard
to any applicable conflicts of law principles (except to the extent that
mandatory provisions of federal or state law apply).
9.9 Publicity. Neither Fifth Third nor Old Kent shall, and
neither Fifth Third nor Old Kent shall permit any of its Subsidiaries to, issue
or cause the publication of any press release or other public announcement with
respect to, or otherwise make any public statement concerning, the transactions
contemplated by this Agreement without the consent of Old Kent (which consent
shall not be unreasonably withheld), in the case of a proposed announcement or
statement by Fifth Third, or Fifth Third, in the case of a proposed announcement
or statement by Old Kent (which consent shall not be unreasonably withheld);
provided, however, that a party may, without the prior consent of the other
party (but after prior consultation with the other party to the extent
practicable under the circumstances) issue or cause the publication of any press
release or other public announcement to the extent required by law or by the
rules and regulations of the NASDAQ and the New York Stock Exchange, Inc.
9.10 Assignment; Third Party Beneficiaries. Neither this
Agreement nor any of the rights, interests or obligations shall be assigned by
any of the parties hereto (whether by operation of law or otherwise) without the
prior written consent of the other parties. Subject to the preceding sentence,
this Agreement will be binding upon, inure to the benefit of and be enforceable
by the parties and their respective successors and assigns. Except as otherwise
specifically provided in Section 6.8, this Agreement (including the documents
and instruments referred to herein) is not intended to confer upon any person
other than the parties hereto any rights or remedies hereunder.
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Remainder of Page Intentionally Left Blank
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IN WITNESS WHEREOF, Fifth Third Financial Corporation and Old
Kent Bancorp. have caused this Agreement to be executed by their respective
officers thereunto duly authorized as of the date first above written.
OLD KENT FINANCIAL CORPORATION
By: /s/ Xxxxx X. Xxxxxx
----------------------------------------
Name: Xxxxx X.Xxxxxx
Title: Chairman of the Board,
President and Chief Executive
Officer
FIFTH THIRD BANCORP
By: /s/ Xxxxxx X. Xxxxxxxx, Xx.
----------------------------------------
Name: Xxxxxx X. Xxxxxxxx, Xx.
Title: President and Chief Executive
Officer
Signature Page to Agreement and Plan of Merger
48
