EXHIBIT 99.2
AMENDMENT TO AGREEMENT AND PLAN OF REORGANIZATION
EXHIBIT 99.2
AMENDMENT TO
AGREEMENT AND PLAN OF REORGANIZATION
AMONG
STERLING FINANCIAL CORPORATION,
STERLING EFI ACQUISITION CORPORATION,
AND
EQUIPMENT FINANCE, INC.
WHEREAS, Sterling Financial Corporation ("Sterling"), Sterling EFI
Acquisition Corporation ("Acquisition Corporation"), and Equipment Finance, Inc.
("EFI") have entered into an Agreement and Plan of Reorganization dated as of
November 2, 2001 (the "Agreement");
WHEREAS, the Parties intend that the terms as contained in this
Amendment to the Agreement shall have the same meaning as in the Agreement.
WHEREAS, the Parties mutually agree to amend and modify the Agreement
to clarify the Exchange Ratio in reference to the Stock Consideration and the
relative proportions of Cash Consideration, Stock Consideration and Reserve
Consideration to be received by the EFI shareholders;
WHEREAS, the Parties believe that this Amendment is in the best
interests of all parties.
NOW, THEREFORE, in consideration of the foregoing and of the mutual
agreements and conditions contained herein and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
Sterling, Acquisition Corporation and EFI, intending to be legally bound hereby,
agree as follows:
1. Effective as of the date of this Amendment, Paragraph 2(a) of the
Agreement is amended in its entirety to read as follows:
Merger Consideration. On the Effective Date, each share of the common
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stock of EFI, no par value, ("EFI Common Stock") issued and outstanding
immediately prior to the Closing Date (except as provided in paragraph
(b) of this Section 2, and subject to paragraphs (e) and (f) of this
Section 2), shall, by virtue of the Merger, automatically and without
any action on the part of the holder thereof, become and be converted
into the right to receive (i) without interest, $12.48 in cash (the
"Cash Consideration"), (ii) 0.5674 shares (the "Exchange Ratio") of
common stock of Sterling, par value $5.00 per share ("Sterling Common
Stock") (the "Stock Consideration") or (iii) a combination of cash and
shares of Sterling Common Stock as provided in Sections 2(c)(5)(A), (B)
and (C) below. In addition, each EFI shareholder shall receive a pro
rata share of the Escrow Reserve Fund, as defined in Section 17 hereof
(the "Reserve Consideration"). Subject to paragraph (e) of this Section
2, the Stock Consideration to be issued under this Agreement shall not
exceed 954,914 shares of Sterling Common Stock and subject to
paragraphs (f) and (i) of this Section 2, the aggregate Cash
Consideration shall be approximately $8,000,000. The Cash
Consideration, the Stock Consideration and the Reserve Consideration
are sometimes referred to herein collectively as the "Merger
Consideration".
EXHIBIT 99.2
2. Effective as of the date of this Amendment, Paragraph 2(c)(4) of the
Agreement is amended in its entirety to read as follows:
Notwithstanding any other provision contained in this Section 2 to the
contrary (other than Sections 2(e), (f) and (i)), approximately 70% of
the Merger Consideration shall be in the form of Stock Consideration,
approximately 3.5% of the Merger Consideration shall be in the form of
Reserve Consideration and approximately 26.5% of the Merger
Consideration shall be in the form of Cash Consideration; provided,
however, that for federal income tax purposes, it is intended that the
Merger will qualify as a reorganization under the provisions of
Sections 368(a)(1)(A) and 368(a)(2)(D) of the Code and, notwithstanding
anything to the contrary contained herein, in order that the Merger
will not fail to satisfy requirements under applicable federal income
tax principles relating to reorganizations under Section 368(a) of the
Code, as reasonably determined by Ernst & Young LLP ("E&Y"), after
consultation with KPMG LLP ("KPMG"), Sterling shall increase the number
of outstanding EFI shares that will be converted into the Stock
Consideration and reduce the number of outstanding EFI shares that will
be converted into the right to receive the Cash Consideration.
3. The Parties further agree that this Amendment is an amendment within
the meaning of Section 20 of the Agreement and that this Amendment complies with
the terms and provisions thereof.
4. Any paragraph of the Agreement not altered by this Amendment shall
remain in full force and effect.
IN WITNESS WHEREOF, the Parties hereto have caused this Amendment to the
Agreement to be duly executed by their duly authorized officers and their
corporate seals to be affixed thereon this 13th day of December, 2001.
ATTEST: STERLING FINANCIAL
CORPORATION
By: /s/ Xxxx X. Xxxxx By: /s/ J. Xxxxx Xxxxx, Xx.
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J. Xxxxx Xxxxx, Xx.,
Senior Executive Vice President and
Chief Operating Officer
ATTEST: STERLING EFI
ACQUISITION CORPORATION
By: /s/ Xxxx X. Xxxxx By: /s/ J. Xxxxx Xxxxx, Xx.
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ATTEST: EQUIPMENT FINANCE, INC.
By: /s/ Xxxx X. Xxxxxx By: /s/ Xxxxxx X. Xxxxxx
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Xxxxxx X. Xxxxxx, President
