EXHIBIT "A"
AGREEMENT AND PLAN OF MERGER
THIS AGREEMENT made this 15th day of October 1996 by and between
INDEPENDENCE BANCORP, INC. ("IBI"), a New Jersey business corporation registered
as a bank holding company under the Bank Holding Company Act of 1956, as amended
("Holding Company Act"), and COMMERCE BANCORP, INC. ("CBI"), a New Jersey
business corporation registered as a bank holding company under the Holding
Company Act (IBI and CBI sometimes collectively referred to as the "Constituent
Corporations").
BACKGROUND
CBI and IBI have entered into an Agreement and Plan of Reorganization of
even date herewith (the "Plan"), which contemplates the merger of IBI with and
into CBI (the "Merger") in accordance with the terms and conditions of this
Merger Agreement.
NOW THEREFORE, in consideration of the premises and mutual covenants and
agreements herein contained, and subject to the satisfaction of the terms and
conditions set forth herein and in the Plan, intending to be legally bound
hereby, IBI and CBI do hereby agree as follows:
SECTION 1
On the Effective Date of the Merger, as hereinafter defined, IBI shall be
merged with and into CBI under and pursuant to Chapter 10 of the New Jersey
Business Corporation Act, as amended ("BCA").
SECTION 2
CBI shall be the surviving corporation (hereinafter referred to as the
"Surviving Corporation"), and the name of the Surviving Corporation shall be
"Commerce Bancorp, Inc."
SECTION 3
On the Effective Date of the Merger:
(a) For all purposes the separate existence of IBI shall cease. IBI shall
be merged with and into CBI, the Surviving Corporation, and the Surviving
Corporation shall thereupon and thereafter possess all the rights, privileges
and powers, of a public as well as of a private
nature, and all property (real, personal and mixed), and franchises of each
of the Constituent Corporations.
(b) All debts due on whatever account to any of the Constituent
Corporations including subscriptions to shares and other chooses in action
belonging to any of the Constituent Corporations shall be taken and deemed to be
transferred to and vested in the Surviving Corporation without further act or
deed.
(c) The Surviving Corporation thenceforth shall be responsible for all the
liabilities and obligations of each of the Constituent Corporations, but the
liabilities of the Constituent Corporations, or of their shareholders,
directors, or officers, shall not be affected; nor shall the rights of the
creditors thereof, or of any persons dealing with the Constituent Corporations,
or any liens upon the property of the Constituent Corporations, be impaired by
the Merger; and any claim existing or action or proceeding pending by or against
any of the Constituent Corporations may be prosecuted to judgment as if the
Merger had not taken place, or the Surviving Corporation may be proceeded
against or substituted in its place.
(d) Any taxes, penalties and public accounts of the State of New Jersey
claimed against any of the Constituent Corporations, but not settled, assessed
or determined prior to the Merger shall be settled, assessed or determined
against the Surviving Corporation and, together with interest thereon, shall be
a lien against the franchises and property, both real and personal, of the
Surviving Corporation.
If at any time the Surviving Corporation shall consider or be advised that
any further assignment or assurances in law, or any things are necessary or
desirable to vest in the Surviving Corporation, according to the terms hereof,
the title of any property or rights of IBI, the last acting officers and
directors of IBI, or the corresponding officers and directors of the Surviving
Corporation, as the case may be, then shall and will execute and make all such
property assignments and assurances, and do all things necessary or proper to
vest title in such property or rights in the Surviving Corporation, and
otherwise to carry out the purposes of this Merger Agreement.
SECTION 4
(a) On the Effective Date, the Articles of Incorporation and By-laws of
CBI, as in effect immediately prior to the Effective Date, shall become the
Articles of Incorporation and By-laws of the Surviving Corporation (whose name
shall remain Commerce Bancorp, Inc.), until duly amended in accordance with law.
(b) On the Effective Date, the then Board of Directors of CBI shall serve
as the Board of Directors of the Surviving Corporation until such time as their
successors have been elected and qualified.
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(c) On the Effective Date, the persons who are executive or other offices
of CBI shall serve as officers of the Surviving Corporation until such time as
the Board of Directors of the Surviving Corporation shall otherwise determine.
SECTION 5
On the Effective Date:
(a) The shares of CBI Common Stock and Preferred Stock then issued or
outstanding (or held in Treasury) shall by virtue of the Merger and without any
action on the part of the holder thereof, be automatically converted into and
become the same number of shares of Common Stock and Preferred Stock of the
Surviving Corporation. From and after the Effective Date, each certificate
which, prior to the Effective Date, represented shares of CBI, shall evidence
ownership of shares of the Surviving Corporation on the basis hereinbefore set
forth. Each share of Common Stock and Preferred Stock of the Surviving
Corporation issued pursuant to this Section shall be fully paid and
non-assessable.
(b) Each share of IBI Common Stock then issued and outstanding immediately
prior to the Effective Date (except as provided in Subsection (d)) shall, by
virtue of the Merger and without any action on the part of the holder thereof,
be automatically converted into and become .935 fully paid and non-assessable
shares of the common stock, par value $1.5625 per share, of CBI ("CBI Common
Stock"), subject to adjustment as set forth in Section 5(f) hereof, (hereinafter
the "Exchange Ratio"). From and after the Effective Date, each certificate
which, prior to the Effective Date, represented shares of IBI Common Stock,
shall evidence ownership of shares of CBI Common Stock on the basis hereinbefore
set forth.
(c) No fractional shares of CBI Common Stock shall be issued as a result of
the Merger. In lieu of the issuance of fractional shares, cash adjustments will
be paid to the shareholders of IBI in respect of any fraction of a share of CBI
Common Stock which would otherwise be issuable under this Merger Agreement. Such
cash adjustment shall be equal to an amount determined by multiplying such
fraction by a number derived by multiplying the Exchange Ratio by the fair
market value of CBI Common Stock (as that term defined in Section 6 hereof).
(d) Each issued, but not outstanding share of IBI Common Stock held as a
treasury share by IBI or owned beneficially by any subsidiary of IBI other than
in a fiduciary capacity or in connection with a debt previously contracted and
all shares of IBI Common Stock owned by CBI or owned beneficially by any
subsidiary of CBI other than in a fiduciary capacity or in connection with a
debt previously contracted at the Effective Date of the Merger, if any, shall
thereupon and without more be cancelled and retired and cease to exist and no
cash, stock or other property shall be delivered in exchange therefor.
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(e) Each share of IBI Preferred Stock then issued and outstanding prior to
the Effective Date shall thereupon and without more be cancelled and retired and
cease to exist and no cash, stock or other property shall be delivered in
exchange therefor.
(f) If prior to the Effective Date, CBI shall issued to holders of CBI
Common Stock any shares of CBI Common Stock as a stock dividend, shall subdivide
the number of outstanding shares of CBI Common Stock into a greater number of
shares or shall contract the number of outstanding shares, then, in any such
case, the number of shares of CBI Common Stock into which shares of IBI Common
Stock are automatically convertible into as set forth in Section 5(b) hereof
shall be adjusted proportionately. For purposes of this Section of this Merger
Agreement, a dividend, subdivision or contraction shall be deemed to have become
final at the close of business on the record date fixed for determining
stockholders entitled to receive such dividend, or whose shares are to be
affected by such subdivision or contraction; provided, however, that in the
event that after such record date, but not before payment of such dividend or
before such subdivision or contraction became effective, CBI shall legally
abandon its plan to pay such dividend, or to effect such subdivision or
contraction, the number of shares of CBI Common Stock issuable on the Effective
Date of the Merger, if adjusted as hereinabove provided, shall forthwith be
readjusted to the number of shares of CBI Common Stock issuable upon the
Effective Date of the Merger which would have been in effect had such dividend,
subdivision or contraction never been declared.
(g) At or prior to the Effective Date, CBI shall designate its Transfer
Agent to act as exchange agent to receive from the holders thereof, certificates
which immediately prior to the Effective Date represented IBI Common Stock and
to exchange such certificates for certificates of CBI Common Stock and cash as
hereinbefore provided.
(h) Promptly after the Effective Date, the exchange agent shall mail to
each record holder, as of the Effective Date, of an outstanding certificate or
certificates, which prior to the Effective Date represented shares of IBI Common
Stock, a letter of transmittal (which shall specify how delivery shall be
effected, and that risk of loss and title to such certificate or certificates
shall pass only upon proper delivery of such certificate or certificates,
together with a properly executed letter of transmittal, to the exchange agent
at its address stated therein), and instructions for use in effecting the
surrender of such certificate or certificates for exchange therefor. Upon
surrender to the exchange agent of such certificate or certificates, together
with such letter of transmittal, properly executed, the exchange agent shall
exchange such certificate or certificates for shares of CBI Common Stock and pay
to such record holder any payment due for a fractional share of CBI Common Stock
as heretofore provided. Until so surrendered, each outstanding certificate or
certificates, which prior to the Effective Date represented shares of IBI Common
Stock shall be deemed for all purposes to evidence ownership of the number of
shares of CBI Common Stock, and the right to receive payment for any fractional
share of CBI Common Stock into which the shares represented by such certificate
or certificates have been changed or converted as aforesaid.
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SECTION 6
On the Effective Date, IBI's obligations under its 1990 and 1986 Stock
Option Plans (collectively, the "Plans") with respect to Stock Options granted
thereunder and not therefore exercised shall be cancelled at the Effective Date
and CBI shall deliver to the holder of each such option, in respect thereof, the
number of shares of CBI Common Stock having an aggregate fair market value on
the Effective Date equal to the product of (i) the number of shares of IBI
Common Stock subject to such option and (ii) the excess, if any, of the Exchange
Ratio multiplied by the fair market value of CBI Common Stock (as defined below)
over the exercise price of such option. For purposes of this Section, the "fair
market value" with respect to a share of CBI Common Stock on the Effective Date
shall be the average closing price of such Common Stock in the New York Stock
Exchange-Composite Transactions List (as reported by The Wall Street Journal or
other authoritative source) on the first ten trading days of the fifteen trading
days immediately preceding the Effective Date of the Merger. Notwithstanding any
other provision hereof, each holder of Stock Options who would otherwise have
been entitled to receive a fraction of a share of CBI Common Stock (after taking
into account all shares to be delivered to such holder upon termination of Stock
Options) shall receive, in lieu thereof, cash in an amount equal to such
fractional part of a share of CBI Common Stock multiplied by a number derived by
multiplying the Exchange Ratio by the fair market value of CBI Common Stock (as
defined above). No such holder shall be entitled to dividends, voting rights or
any other shareholder right in respect of any fractional share.
SECTION 7
(a) The obligations of the parties hereto to effect the Merger shall be
subject to all of the terms and conditions contained in the Plan.
(b) This Merger Agreement may be terminated and the Merger abandoned by the
mutual written consent of the Boards of Directors of the parties hereto prior
to, or after the approval of the shareholders of the parties. If the Plan is
terminated pursuant to the terms thereof, then this Merger Agreement shall
terminate simultaneously, and the Merger shall be abandoned without further
action by the parties hereto.
SECTION 8
The Merger shall become effective (the "Effective Date") at the date and
time at which executed Certificate of Merger are duly filed with the New Jersey
Secretary of State in accordance with Chapter 10 of the BCA.
SECTION 9
(a) Any party to this Merger Agreement may, at any time prior to the
Effective Date, by action taken by its Board of Directors or officers thereunto
duly authorized, waive any
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of the terms or conditions of this Merger Agreement, or agree to an amendment or
modification to this Merger Agreement by an agreement in writing executed in the
same manner (but not necessarily by the same persons) as this Merger Agreement.
No amendment, modification or waiver of this Merger Agreement shall be binding
unless executed in writing by the party to be bound thereby. No waiver of any of
the provisions of this Merger Agreement shall be deemed or shall constitute a
waiver of any other provisions hereof (whether or not similar), nor shall any
waiver constitute a continuing waiver unless otherwise expressly provided. IBI's
Board of Directors may authorize the amendment or supplementation of this Merger
Agreement or waiver of any provision hereof, either before or after the approval
of IBI's shareholders provided in Section 5 of the Plan (and without seeking
further shareholder approval), so long as such amendment, supplement or waiver
does not result in the reduction of the Exchange Ratio, or result in an adverse
tax or other effect to IBI's shareholders.
(b) Nothing expressed or implied in this Merger Agreement is intended or
shall be construed to confer upon or give any person, firm or corporation other
than the parties hereto any rights or remedies under or by reason of this Merger
Agreement, and there are no third-party beneficiaries of this Merger Agreement.
(c) No party hereto shall assign this Merger Agreement, or any part hereof
without the prior written consent of the other parties. Except as otherwise
provided herein, this Merger Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective permitted successors and
assigns.
(d) This Merger Agreement and the Plan constitute the entire agreement
between the parties pertaining to the subject matter hereof, and supersede all
prior and contemporaneous agreements, understandings, negotiations and
discussions, whether oral or written, of the parties, and there are no
warranties, representations, covenants or other agreements between the parties
in connection with the subject matter hereof except as specifically set forth
herein or therein.
(e) This Merger Agreement may be executed in two or more counterparts, each
of which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
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(f) This Merger Agreement shall be governed by the laws of the State of New
Jersey applicable to contracts executed in and to be performed exclusively
within the State of New Jersey, regardless of where it is executed.
WITNESS the signatures and seals of the Constituent Corporations on the day
and year first above written, each hereunto set by its duly authorized officers
and attested by its Secretary or Assistant Secretary, pursuant to a resolution
of the Board of Directors.
COMMERCE BANCORP, INC.
By: /s/ XXXXXX X. XXXX, XX
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Xxxxxx X. Xxxx, XX, Chairman
INDEPENDENCE BANCORP, INC.
By: /s/ XXXXX X. XXXXXXXXXX
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Xxxxx X. Xxxxxxxxxx, Chairman
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