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EXHIBIT 2
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PLAN AND AGREEMENT OF MERGER
BETWEEN
MOUNTAIN WEST BANK
AND
NEW MOUNTAIN WEST BANK
UPON ITS FORMATION BY
GLACIER BANCORP, INC.
DATED AS OF SEPTEMBER 9, 1999
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TABLE OF CONTENTS
Page No.
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SECTION 1 TERMS OF TRANSACTION...................................................................2
1.1 Transaction........................................................................2
1.2 Effect of Transaction..............................................................3
1.3 Prospective Effect.................................................................3
1.4 Events of Closing..................................................................3
1.5 Effect on Glacier Common Stock.....................................................3
1.6 Consideration......................................................................3
1.7 Payment to Dissenting Stockholders.................................................5
1.8 Alternative Structures.............................................................5
1.9 Letter of Transmittal..............................................................5
1.10 Undelivered Certificates...........................................................6
1.11 Stock Option Agreement.............................................................6
SECTION 2 CLOSING OF THE TRANSACTION.............................................................6
2.1 Closing............................................................................6
2.2 Events of Closing..................................................................6
2.3 Place of Closing...................................................................6
SECTION 3 REPRESENTATIONS........................................................................6
3.1 Representations of Glacier and Mountain West.......................................6
3.2 Mountain West's Additional Representations........................................11
3.3 Exceptions to Representations.....................................................18
SECTION 4 CONDUCT AND TRANSACTIONS BEFORE CLOSING...............................................18
4.1 Conduct of Mountain West's Business Before Closing................................18
4.2 Registration Statement............................................................22
4.3 Accounting Treatment..............................................................22
4.4 Submission to Regulatory Authorities..............................................23
4.5 Announcements.....................................................................23
4.6 Consents..........................................................................23
4.7 Further Actions...................................................................23
4.8 Notice............................................................................24
4.9 Confidentiality...................................................................24
4.10 Update of Financial Statements....................................................24
4.11 Availability of Glacier's Books, Records and Properties...........................24
SECTION 5 APPROVALS AND CONDITIONS..............................................................25
5.1 Required Approvals................................................................25
5.2 Conditions to Glacier's Obligations...............................................25
5.3 Conditions to Mountain West's Obligations.........................................27
SECTION 6 DIRECTORS, OFFICERS AND EMPLOYEES.....................................................28
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6.1 Directors.........................................................................28
6.2 Employment Agreement..............................................................28
6.3 Employees.........................................................................29
6.4 Indemnification...................................................................29
6.5 Employee Benefit Issues...........................................................30
SECTION 7 TERMINATION OF AGREEMENT AND
ABANDONMENT OF TRANSACTION.........................................................30
7.1 Termination by Reason of Lapse of Time............................................30
7.2 Other Grounds for Termination.....................................................30
7.3 Mountain West Termination Fee.....................................................31
7.4 Glacier Termination Fee...........................................................31
7.5 Cost Allocation Upon Termination..................................................31
SECTION 8 MISCELLANEOUS.........................................................................31
8.1 Notices...........................................................................31
8.2 Waivers and Extensions............................................................33
8.3 General Interpretation............................................................33
8.4 Construction and Execution in Counterparts........................................33
8.5 Survival of Representations and Covenants.........................................33
8.6 Attorneys' Fees and Costs.........................................................33
8.7 Arbitration.......................................................................33
8.8 Governing Law and Venue...........................................................34
8.9 Severability......................................................................34
SECTION 9 AMENDMENTS............................................................................34
EXHIBITS AND SCHEDULES:
EXHIBIT A Voting Agreement
EXHIBIT B Non-Competition Agreement
EXHIBIT C Form of Affiliate Letter
EXHIBIT D Form of Opinion for Xxxxxx & Xxxxx, X.X.
EXHIBIT E Form of Opinion for Xxxxxx & Xxxx, P.C.
EXHIBIT F Names and Residences of Combined Bank's Directors and Officers
EXHIBIT G Amendments to the Combined Bank's Articles and Bylaws
TRANSITION PLAN SCHEDULE
SCHEDULE 1 Exceptions to Representations
SCHEDULE 2 Offices
SCHEDULE 3 Subsidiaries
SCHEDULE 4 Glacier and Mountain West Stock Plans
SCHEDULE 5 Material Contracts
SCHEDULE 6 Mountain West's Required Third Party Consents
SCHEDULE 7 Mountain West's Asset Classification List
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SCHEDULE 8 Mountain West's Investments
SCHEDULE 9 Mountain West's Property Encumbrances
SCHEDULE 10 Mountain West's Offices and Branches
SCHEDULE 11 Mountain West's Compliance with Laws
SCHEDULE 12 Mountain West's Litigation Disclosure
SCHEDULE 13 Mountain West's Insurance Policies
SCHEDULE 14 Mountain West's Employee Benefit Plans
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INDEX OF DEFINITIONS
TERMS SECTION
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Agreement Intro. Paragraph
ASR 4.3.2
Asset Classification 3.2.4
Bank Common Stock 3.1.3(b)(2)
BHCA Recital A
Closing 1.4
Change in Control 1.3
Columbia Recital G
Combined Bank 1.2
Company Common Stock 3.1.3(b)(1)
Compensation Plans 3.2.14(b)
Continuing Employees 6.3
Contracts 3.2.3(b)
Dissenting Shares 1.7
Effective Date 2.1
Employees 3.2.14(b)
Environmental Laws 3.2.15(a)(2)
ERISA 3.2.14(a)
Exchange Act 3.1.5(b)
Exchange Agent 1.6.4(a)
Exchange Ratio 1.6.1
Executive Officer 3.1.8
FDIC Recital D
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TERMS SECTION
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Federal Reserve Board Recital D
Financial Statements 3.1.5(d)(1)
GAAP 3.1.5(d)
Glacier Intro. Paragraph
Glacier Common Stock 3.1.3(a)(1)
Glacier Financial Statements 3.1.5(d)(2)
Glacier Option 1.6.5
Glacier Preferred Stock 3.1.3(a)(1)
Glacier Shares 1.6.1
Glacier Stock Plans 3.1.3(a)(2)
Governmental Entity 3.2.3(a)
Hazardous Substances 3.2.15(a)(3)
Information Technology 3.2.13
IRC Recital H
Liens 3.1.3(a)(5)
Material Adverse Effect 3.1.6
Merger Recital B
Mountain West Intro. Paragraph
Mountain West Common Stock 1.1
Mountain West Option 1.6.5
Mountain West Financial Statements 3.1.5(d)(4)
Mountain West Stock Plans 3.1.3(b)(2)
New Bank Intro. Paragraph
OTS 3.1.5(a)
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TERMS SECTION
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Pension Plan 3.2.14(c)
Plan/Plans 3.2.14(a)
Property 4.1.10
Prospectus/Proxy Statement 4.2.1(a)
Registration Statement 4.2.1(a)
Regulatory Approvals Recital D
Reports 3.1.5(b)
SEC 3.1.5(a)
Securities Act 3.1.5(b)
Securities Laws 3.1.5(b)
Stock Option Agreement Recital I
Subject Property 3.2.15(a)(1)
Subsequent Glacier Financial Statements 3.1.5(d)(3)
Subsequent Mountain West Financial Statements 3.1.5(d)(5)
Subsidiary/Subsidiaries 3.1.2(a)
Tangible Equity Capital 5.2.3
Tax 3.2.10
Termination Date 2.1
Transaction 1.1
Transaction Fees 5.2.4
Year 2000 Compliance 3.2.13
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PLAN AND AGREEMENT OF MERGER
BETWEEN
MOUNTAIN WEST BANK
AND
NEW MOUNTAIN WEST BANK
UPON ITS FORMATION BY
GLACIER BANCORP, INC.
This Plan and Agreement of Merger (the "Agreement"), dated as of
September 9, 1999, is between MOUNTAIN WEST BANK ("Mountain West") and GLACIER
BANCORP, INC. ("Glacier"), acting on its own behalf and on behalf of an Idaho
banking corporation to be formed by it under the title NEW MOUNTAIN WEST BANK
(the "New Bank").
PREAMBLE
The management and boards of directors of Glacier and Mountain West,
respectively, believe that the proposed transaction between Glacier and Mountain
West, on the terms and conditions set forth in this Agreement, is in the best
interests of Glacier's and Mountain West's stockholders.
RECITALS
A. THE PARTIES. The parties to the Merger are as follows:
(1) Mountain West is a state-chartered banking corporation duly
organized and validly existing under Idaho law with its
principal office located in Coeur d'Alene, Idaho.
(2) Glacier is a corporation duly organized and validly existing
under Delaware law and is a registered bank holding company
under the Bank Holding Company Act of 1956, as amended ("BHCA").
Glacier's principal office is located in Kalispell, Montana.
Glacier owns (1) all of the outstanding common stock of Glacier
Bank, First Security Bank of Missoula, Valley Bank of Helena,
and Big Sky Western Bank; and (2) 94 and 98% of the outstanding
common stock of Glacier Bank of Whitefish and Glacier Bank of
Eureka, respectively.
(3) New Bank will be organized by persons designated by Glacier who
will, upon execution of this Agreement by Mountain West and
Glacier, apply for preliminary approval from the State of Idaho
for New Bank to become an interim state banking corporation.
Upon receipt of such preliminary approval, New Bank will become
a body corporate and will execute this Agreement, thereby
becoming a party hereto and ratifying all prior actions taken on
its behalf by Glacier. All of the capital stock of New Bank will
be subscribed for solely by Glacier, and the consideration for
such stock will be paid in before the Effective Date.
B. THE MERGER. On the Effective Date, all of the outstanding shares of
Mountain West common stock will be exchanged for shares of Glacier
Common Stock, and Mountain West will become a wholly-owned subsidiary of
Glacier.
C. BOARD APPROVALS. Glacier's and Mountain West's respective boards of
directors have approved this Agreement and authorized its execution and
delivery.
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D. OTHER APPROVALS. The Merger is subject to:
(1) Satisfaction of the conditions described in this Agreement;
(2) Approval by Mountain West's stockholders; and
(3) Approval or acquiescence, as appropriate, by (a) the Board of
Governors of the Federal Reserve System ("Federal Reserve
Board"), (b) the Federal Deposit Insurance Corporation ("FDIC"),
and (c) the State of Idaho (collectively, "Regulatory
Approvals").
E. EMPLOYMENT AGREEMENTS. Mountain West has entered into an employment
agreement, effective as of the Effective Date, with Xxx X. Xxxxxxx,
Mountain West's President and Chief Executive Officer. In addition to
remaining as Mountain West's President and CEO, Xx. Xxxxxxx will also be
appointed to the Glacier board of directors. It is anticipated that
Mountain West will also enter into employment agreements with Xxxxxx
Xxxx, Xxxxx Xxxx, Xxxx X. Xxxx and Xxxxx Xxxxx.
F. DIRECTOR AGREEMENTS. In association with the parties' execution of this
Agreement, the directors and officers of Mountain West have entered into
agreements, substantially in the form attached to this Agreement as
Exhibit A, pursuant to which, among other things, each such individual
has agreed to vote his or her shares of Mountain West common stock in
favor of the actions contemplated by this Agreement. In addition, all
such directors and officers have entered into non-competition
agreements, substantially in the form attached to this Agreement as
Exhibit B.
G. FAIRNESS OPINION. Mountain West has received from Columbia Financial
Advisors ("Columbia") and delivered to Glacier an opinion to the effect
that the financial terms of the Transaction are financially fair to
Mountain West's stockholders. As a condition to Closing of the
Transaction, Columbia will update this fairness opinion (1) immediately
before Mountain West mails the Prospectus/Proxy Statement to its
stockholders and (2) immediately before Closing.
H. INTENTION OF THE PARTIES--ACCOUNTING AND TAX TREATMENT. The parties
intend the Merger to qualify, for accounting purposes, as a "pooling of
interests." The parties intend the Merger to qualify, for federal income
tax purposes, as a tax-free reorganization under Section 368(a) of the
Internal Revenue Code of 1986, as amended ("IRC").
I. STOCK OPTION AGREEMENT. As an inducement to and condition of Glacier's
execution of this Agreement, Mountain West has approved the grant of an
option to Glacier under the Stock Option Agreement, as provided in
Subsection 1.11.
AGREEMENT
Glacier and Mountain West agree as follows:
SECTION 1
TERMS OF TRANSACTION
1.1 TRANSACTION. Under and subject to this Agreement and the other documents
referred to in this Agreement, Glacier will acquire all of the
outstanding common stock shares of Mountain West ("Mountain West Common
Stock"). All outstanding shares of Mountain West Common Stock will be
exchanged for common stock shares of Glacier ("Glacier Common Stock").
The term "Transaction" means the Merger transaction contemplated by this
Agreement, subject to any modifications Glacier elects in accordance
with Subsection 1.8.
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1.2 EFFECT OF TRANSACTION. On the Effective Date, the corporate existence of
each of Mountain West and the New Bank will be merged into and continued
in the resulting bank of the Merger (the "Combined Bank"). The principal
office of the Combined Bank will be located in Coeur d'Alene, Idaho, and
will be deemed to be the same corporation as each of Mountain West and
the New Bank. The authorized capital of the Combined Bank will consist
of 1,500,000 shares of common stock, $2.50 par value per share. The
Articles of Incorporation and the Bylaws of the Combined Bank will be
the Articles of Incorporation and the Bylaws of Mountain West in effect
immediately before the Effective Time, subject to the amendments to the
Articles and Bylaws attached to this Agreement as Exhibit G. All rights,
franchises and interests of each of Mountain West and the New Bank in
and to every type of property (real, personal and mixed) and choses in
action will be transferred to and vested in the Combined Bank by virtue
of the Merger without any deed or other transfer. The Combined Bank,
upon the Effective Date and without any order or other action on the
part of any court or otherwise, will hold and enjoy all rights of
property, franchises, and interests in the same manner and to the same
extent as such rights, franchises and interests were held or enjoyed by
each of the Bank and New Bank immediately prior to the Effective Date,
subject to the conditions of Title 26 of the Idaho Statutes. The name of
the Combined Bank will be "Mountain West Bank."
1.3 PROSPECTIVE EFFECT. Subject to a Change in Control of Glacier, the
following provisions will apply: (a) the Combined Bank will retain the
name "Mountain West Bank" for at least 3 years following the Effective
Date; (b) there will be no data processing or system computer
conversions for Mountain West for at least 2 years following the
Effective Date; and (c) subject to Glacier and its subsidiaries
remaining well-capitalized, within 2 years of the Effective Date and at
the request of Mountain West, Glacier will provide sufficient capital
for Mountain West to expand by 2 branches and for construction of a
permanent Boise branch building. "Change in Control" means a change "in
the ownership or effective control" or "in the ownership of a
substantial portion of the assets" of Mountain West, within the meaning
of section 280G of the Internal Revenue Code.
1.4 EVENTS OF CLOSING. Closing of the Transaction will take place in
accordance with Section 2 ("Closing"). All shares, other than Dissenting
Shares, of Mountain West Common Stock issued and outstanding immediately
before Closing will be exchanged at Closing for shares of Glacier Common
Stock in accordance with Subsection 1.6 by virtue of the Merger and
without any further action required by the holders of Mountain West
Common Stock. After Closing and subject to any Dissenting Shares,
Glacier will own all of the outstanding shares of Mountain West Common
Stock. The Board of Directors of Mountain West after the Effective Date
will consist of Mountain West's directors immediately before the Merger,
with the addition of Xxxxxxx X. Xxxxxxxx (or, if Xx. Xxxxxxxx is unable
to serve, another individual designated by Glacier). Nothing in this
Agreement is intended to restrict any rights of Mountain West's
stockholder and directors at any time after the Effective Date to
nominate, elect, select, or remove directors. As required by Section
26-903 (c) of the Idaho Statutes, the names and residences of the
proposed officers and directors of the Combined Bank are listed on
Exhibit F.
1.5 EFFECT ON GLACIER COMMON STOCK. Glacier Common Stock shares issued and
outstanding immediately before the Effective Date will remain
outstanding and unchanged after the Merger.
1.6 CONSIDERATION.
1.6.1 EXCHANGE RATIO. Subject to the conditions and limitations in
this Agreement, holders of Mountain West Common Stock will
receive Glacier Common Stock in exchange for their Mountain West
Common Stock. The number (rounded to 2 decimals, rounding down
if the third decimal is four or less or up if it is five or
more) of Glacier Common Stock shares each holder will receive in
exchange for each Mountain West Common Stock share he or she
holds of record on the Effective Date (the "Exchange Ratio")
will be 1.18, subject to Subsections 1.6.2 (change
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in equity capital) and 1.7 (dissenting shares). The shares of
Glacier Common Stock to be issued to Mountain West Common
Stockholders under this Agreement in connection with the
Transaction are referred to as the "Glacier Shares."
1.6.2 CHANGE IN EQUITY CAPITAL. If, after the date of this Agreement
but before the Effective Date, Glacier's or Mountain West's
Common Stock issued and outstanding increases or decreases in
number or is changed into or exchanged for a different kind or
number of securities, through a recapitalization,
reclassification, stock dividend, stock split, reverse stock
split or other similar change in capitalization (not including
increases in number due to issuances of shares upon exercise of
any outstanding options to purchase Glacier Common Stock shares)
of Glacier or Mountain West, as the case may be, then, as
appropriate, the parties will make the proportionate adjustment
to the Exchange Ratio.
1.6.3 NO FRACTIONAL SHARES. No fractional shares of Glacier
Corporation Common Stock will be issued. In lieu of fractional
shares, if any, each stockholder of Mountain West who is
otherwise entitled to receive a fractional share of Glacier
Common Stock will receive an amount of cash equal to the product
of such fraction times $20. Such fractional share interests will
not include the right to vote or receive dividends or any
interest on dividends.
1.6.4 CERTIFICATES.
(a) Surrender of Certificates. Each certificate evidencing
Mountain West Common Stock shares (other than Dissenting
Shares) will, on and after the Effective Date, be deemed
for all corporate purposes to represent and evidence
only the right to receive a certificate representing the
Glacier Shares (or to receive the cash for fractional
shares) to which the Mountain West Common Stock shares
converted in accordance with the provisions of this
Subsection 1.6. Following the Effective Date, Mountain
West stockholders shall exchange Mountain West Common
Stock certificates by surrendering them to the agent
("Exchange Agent") designated by Glacier and Mountain
West to effect the exchange of Mountain West Common
Stock certificates for certificates representing Glacier
Shares (or for cash in lieu of fractional shares), in
accordance with any instructions provided by the
Exchange Agent and together with a properly completed
and executed form of transmittal letter. Until a
holder's certificate evidencing Mountain West Common
Stock is so surrendered, the holder will not be entitled
to receive any certificates evidencing Glacier Shares or
cash in lieu of fractional shares.
(b) Issuance of Certificates in Other Names. Any person
requesting that any certificate evidencing Glacier
Shares be issued in a name other than the name in which
the surrendered Mountain West Common Stock certificate
is registered, must: (1) establish to the Exchange
Agent's satisfaction the right to receive the
certificate evidencing Glacier Shares and (2) either pay
to the Exchange Agent any applicable transfer or other
taxes or establish to the Exchange Agent's satisfaction
that all applicable taxes have been paid or are not
required.
(c) Lost, Stolen, and Destroyed Certificates. The Exchange
Agent will be authorized to issue a certificate
representing Glacier Shares in exchange for a Mountain
West Common Stock certificate that has been lost, stolen
or destroyed, if the holder provides the Exchange Agent
with: (1) satisfactory evidence that the holder owns
Mountain West Common Stock and that the certificate
representing this ownership is lost, stolen, or
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destroyed, (2) any appropriate affidavit the Exchange
Agent may require, and (3) any indemnification
assurances that the Exchange Agent may require.
(d) Rights to Dividends and Distributions. After the
Effective Date, no holder of a certificate evidencing
Mountain West Common Stock shares will be entitled to
receive any dividends or other distributions otherwise
payable to holders of record of Glacier Common Stock on
any date after the Effective Date, unless the holder (1)
is entitled by this Agreement to receive a certificate
representing Glacier Shares and (2) has surrendered in
accordance with this Agreement his or her Mountain West
Common Stock certificates (or has met the requirements
of Subsection 1.6.4((c)) above) in exchange for
certificates representing Glacier Shares. Surrender of
Mountain West Common Stock certificates will not deprive
the holder of any dividends or distributions that the
holder is entitled to receive as a record holder of
Mountain West Common Stock on a date before the
Effective Date. When the holder surrenders his or her
certificates, the holder will receive the amount,
without interest, of any cash dividends and any other
distributions distributed after the Effective Date on
the whole number of shares of Glacier Shares into which
the holder's Mountain West Common Stock was converted at
the Effective Date.
(e) Checks in Other Names. Any person requesting that a
check for cash in lieu of fractional shares be issued in
a name other than the name in which the Mountain West
Common Stock certificate surrendered in exchange for the
cash is registered, must establish to the Exchange
Agent's satisfaction the right to receive this cash.
1.6.5 EFFECT ON MOUNTAIN WEST OPTIONS. On the Effective Date, by
virtue of the Merger, and without any action on the part of any
party, any option to acquire Mountain West Common Stock,
excluding the option under the Stock Option Agreement ("Mountain
West Option"), will be converted into and become an option to
purchase Glacier Common Stock ("Glacier Option") on the same
terms and conditions as are in effect with respect to the
Mountain West Option immediately prior to the Effective Date,
except that (A) each such Glacier Option may be exercised solely
for shares of Glacier Common Stock, (B) the number of shares of
Glacier Common Stock subject to such Glacier Option will be
equal to the number of shares of Mountain Common Stock subject
to such option immediately prior to the Effective Date
multiplied by the Exchange Ratio, the product being rounded, if
necessary, up or down to the nearest whole share, and (C) the
per share exercise price under each such Glacier Option will be
adjusted by dividing the Mountain West Option exercise price by
the Exchange Ratio and rounding up or down to the nearest cent.
1.7 PAYMENT TO DISSENTING STOCKHOLDERS. For purposes of this Agreement,
"Dissenting Shares" means those shares of Mountain West Common Stock as
to which stockholders have properly taken all steps necessary to perfect
their dissenters' rights under Section 26-909 of the Idaho Statutes.
Each outstanding Dissenting Share of Mountain West Common Stock will be
converted at Closing into the rights provided under this section of the
Idaho Statutes. For purposes of (beta) 26-909 (2) of the Idaho Statutes,
the parties to this Agreement hereby fix $21 as the fair market value of
dissenting shares of Mountain West Common Stock.
1.8 ALTERNATIVE STRUCTURES. Subject to the conditions set forth below,
Glacier may in its sole discretion elect to consummate the Transaction
by means other than those specified in this Section 1. If Glacier so
elects, any means, procedures, or amendments necessary or desirable to
consummate the Transaction, in the opinion of Glacier's counsel, will
supersede any conflicting, undesirable or unnecessary provisions of this
Agreement. But, unless this Agreement is amended in accordance with
Section 9, the following
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conditions will apply: (1) the type and amount of consideration set
forth in Subsection 1.6 will not be modified and (2) the tax
consequences to Mountain West and its stockholders will not be adversely
affected.
1.9 LETTER OF TRANSMITTAL. Glacier will prepare a transmittal letter form
reasonably acceptable to Mountain West for use by stockholders holding
Mountain West Common Stock. Certificates representing shares of Mountain
West Common Stock must be delivered for payment in the manner provided
in the transmittal letter form. On or about the Effective Date, Glacier
will mail the transmittal letter form to Mountain West stockholders.
1.10 UNDELIVERED CERTIFICATES. If outstanding certificates for Mountain West
Common Stock are not surrendered or the payment for them is not claimed
before those payments would escheat or become the property of any
governmental unit or agency, the unclaimed items will, to the extent
permitted by abandoned property or any other applicable law, become the
property of Glacier (and to the extent not in its possession will be
paid over to Glacier), free and clear of all claims or interests of any
person previously entitled to such items. But, neither Glacier nor
Mountain West will be liable to any holder of Mountain West Common Stock
for any amount paid to any governmental unit or agency having
jurisdiction over any such unclaimed items under the abandoned property
or other applicable law of the jurisdiction, and Glacier will pay no
interest on amounts owed to stockholders for shares of Mountain West
Common Stock.
1.11 STOCK OPTION AGREEMENT. As a condition to the execution of this
Agreement, Glacier and Mountain West have executed a Stock Option
Agreement, dated the same date as this Agreement.
SECTION 2
CLOSING OF THE TRANSACTION
2.1 CLOSING. Closing will occur on the Effective Date. If Closing does not
occur on or before March 31, 2000 ("Termination Date"), either Glacier
or Mountain West may terminate this Agreement in accordance with Section
7. Unless Glacier and Mountain West agree upon another date, the
Effective Date will be a date selected by Glacier within 30 calendar
days after the following, but no sooner than January 17, 2000:
(a) each condition precedent set forth in Section 5 has been either
fulfilled or waived; and
(b) each approval required by Section 5 has been granted, and all
applicable waiting periods have expired.
2.2 EVENTS OF CLOSING. On the Effective Date, all properly executed
documents required by this Agreement will be delivered to the proper
party in form consistent with this Agreement. If any party fails to
deliver a required document on the Effective Date or otherwise defaults
under this Agreement on or before the Effective Date, then the
Transaction will not occur unless the adversely affected party waives
the default.
2.3 PLACE OF CLOSING. Unless Glacier and Mountain West agree otherwise,
Closing will occur on the Effective Date at Glacier's corporate office,
00 Xxxxxxx Xxxx, Xxxxxxxxx, Xxxxxxx.
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SECTION 3
REPRESENTATIONS
3.1 REPRESENTATIONS OF GLACIER AND MOUNTAIN WEST. Subject to Subsection 3.3
and except as expressly set forth in Schedule 1, Glacier (and as
appropriate, New Bank) represents to Mountain West, and Mountain West
represents to Glacier and New Bank, the following:
3.1.1 CORPORATE ORGANIZATION AND QUALIFICATION.
(a) It is a corporation duly organized and validly existing
under the state laws of either Idaho or Delaware (as
applicable), and its activities do not require it to be
qualified in any jurisdiction other than Montana (for
Glacier) and Idaho (for Mountain West).
(b) It has the requisite corporate power and authority to
own or lease its properties and assets and to carry on
its businesses as they are now being conducted.
(c) It has made available to the other party to this
Agreement a complete and correct copy of its certificate
or articles of incorporation and bylaws, each as amended
to date and currently in full force and effect.
3.1.2 SUBSIDIARIES.
(a) With respect to Mountain West only, Schedule 3 lists all
of its Subsidiaries and its percentage ownership of
these Subsidiaries, as of the date of this Agreement. In
this Agreement, the term "Subsidiary" with respect to a
party means any corporation, partnership, financial
institution, trust company, or other entity owned or
controlled by that party or any of its subsidiaries or
affiliates (or owned or controlled by that party
together with one or more of its subsidiaries or
affiliates). A Subsidiary is considered to be owned or
controlled by a party if that party or any of its
Subsidiaries (individually or together with the party)
directly or indirectly owns, controls, or has the
ability to exercise 50% or more of the voting power of
the Subsidiary.
(b) Each of its Subsidiaries is a corporation duly organized
and validly existing under Montana or Idaho law, as the
case may be, and is qualified to do business and in good
standing in each jurisdiction where the property owned,
leased, or operated, or the business conducted by the
Subsidiary, requires this qualification.
(c) Each of its Subsidiaries has the requisite corporate
power and authority to own or lease its properties and
assets and to carry on its business as it is now being
conducted.
3.1.3 CAPITAL STOCK.
(a) Glacier. Glacier represents:
(1) on the date this Agreement was signed, Glacier's
authorized capital stock consists of 16 million
shares divided into two classes: (i) 15 million
shares of common stock, par value $.01 per share
("Company Common Stock"), _______________ shares
of which are issued and outstanding and (ii) 1
million shares of blank-check preferred stock,
par value $.01 per share, none of which is
outstanding ("Glacier Preferred Stock");
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(2) options or rights to acquire not more than an
aggregate of _____________ Company Common Stock
shares (subject to adjustment on the terms set
forth in the Glacier Stock Plans) are
outstanding under the stock option plans listed
in Schedule 4 ("Glacier Stock Plans");
(3) No Company Common Stock shares are reserved for
issuance, other than the shares reserved for
issuance under the Glacier Stock Plans, and
Glacier has no shares of Glacier Preferred Stock
reserved for issuance;
(4) all outstanding shares of Company Common Stock
have been duly authorized and validly issued and
are fully paid and nonassessable;
(5) all outstanding shares of capital stock of each
of Glacier's Subsidiaries owned by Glacier or a
Subsidiary of Glacier have been duly authorized
and validly issued and are fully paid and
nonassessable, except to the extent any
assessment is required under federal law, and
are owned by Glacier or a Subsidiary of Glacier
free and clear of all liens, pledges, security
interests, claims, proxies, preemptive or
subscriptive rights or other encumbrances or
restrictions of any kind (collectively,
"Liens"); and
(6) except as set forth in this Agreement or in the
Glacier Stock Plans, there are no preemptive
rights or any outstanding subscriptions,
options, warrants, rights, convertible
securities, or other agreements or commitments
of Glacier or any of its Subsidiaries of any
character relating to the issued or unissued
capital stock or other equity securities of
Glacier (including those relating to the
issuance, sale, purchase, redemption,
conversion, exchange, registration, voting or
transfer of such stock or securities).
(b) Mountain West. Mountain West represents:
(1) Schedule 2 contains a complete list of all of
its banking offices.
(2) as of the date of this Agreement, Mountain
West's authorized capital stock consists of (i)
1,500,000 shares of common stock, $2.50 par
value ("Bank Common Stock"), 715,472 shares of
which are issued and outstanding,
(3) options or rights to acquire not more than an
aggregate of 115,019 Bank Common Stock shares
(subject to adjustment on the terms set forth in
the Mountain West Stock Plans) are outstanding
under the stock option plans listed in Schedule
4 ("Mountain West Stock Plans");
(4) no Bank Common Stock shares are reserved for
issuance, other than the shares reserved for
issuance under the Mountain West Stock Plan;
(5) all outstanding Mountain West Common Stock
shares have been duly authorized and validly
issued and are fully paid and nonassessable,
except to the extent of any assessment required
under (beta) 26-1113 of the Idaho Statutes;
(6) all outstanding shares of capital stock of each
of Mountain West's Subsidiaries have been duly
authorized and validly issued and are fully paid
and nonassessable, and, except as otherwise
provided in this Agreement, at Closing
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will be owned by Mountain West or a Subsidiary
of Mountain West free and clear of all Liens;
(7) There are no preemptive rights or any
outstanding subscriptions, options, warrants,
rights, convertible securities, or other
agreements or commitments of Mountain West or
any of its Subsidiaries of any character
relating to the issued or unissued capital stock
or other equity securities of Mountain West or
any of its Subsidiaries (including those
relating to the issuance, sale, purchase,
redemption, conversion, exchange, registration,
voting or transfer of such stock or securities);
(8) it (alone or together with any of its
Subsidiaries) owns all of the shares of capital
stock (or 100% of any other applicable form of
ownership interest if the Subsidiary is not a
corporation) of each of its Subsidiaries free
and clear of all encumbrances.
3.1.4 CORPORATE AUTHORITY.
(a) It has the requisite corporate power and authority and
has taken all corporate action necessary in order to
execute and deliver this Agreement, subject (in Mountain
West's case) only to the approval by Mountain West's
stockholders of the plan of Merger contained in this
Agreement to the extent required by Section 26-904 of
the Idaho Statutes, to complete the Transaction.
(b) This Agreement is a valid and legally binding agreement
of it, enforceable in accordance with the terms of this
Agreement.
3.1.5 REPORTS AND FINANCIAL STATEMENTS.
(a) Filing of Reports. Since January 1, 1996, it and each of
its Subsidiaries has filed all reports and statements,
together with any required amendments to these reports
and statements, that it was required to file with (1)
the Securities and Exchange Commission ("SEC"), (2) the
Federal Reserve Board, (3) the FDIC, (4) the Office of
Thrift Supervision ("OTS") and (5) any other applicable
federal or state banking, insurance, securities, or
other regulatory authorities. Each of these reports and
statements, including the related financial statements
and exhibits, complied (or will comply, in the case of
reports or statements filed after the date of this
Agreement) as to form in all material respects with all
applicable statutes, rules and regulations as of their
respective dates (and, in the case of reports or
statements filed before the date of this Agreement,
without giving effect to any amendments or modifications
filed after the date of this Agreement).
(b) Delivery to Other Party of Reports. It has delivered to
the other party a copy of each registration statement,
offering circular, report, definitive proxy statement or
information statement under the Securities Act of 1933,
as amended, ("Securities Act"), the Securities Exchange
Act of 1934, as amended, ("Exchange Act"), and state
securities and "Blue Sky" laws (collectively, the
"Securities Laws") filed, used or circulated by it with
respect to periods since January 1, 1996, through the
date of this Agreement. It will promptly deliver to the
other party each such registration statement, offering
circular, report, definitive proxy statement or
information statement filed, used or circulated after
the date of this Agreement (collectively, its
"Reports"), each in the form (including
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related exhibits and amendments) filed with the SEC or
the FDIC (or if not so filed, in the form used or
circulated).
(c) Compliance with Securities Laws. As of their respective
dates (and without giving effect to any amendments or
modifications filed after the date of this Agreement),
each of the Reports, including the related financial
statements, exhibits and schedules, filed, used or
circulated before the date of this Agreement complied
(and each of the Reports filed after the date of this
Agreement, will comply) in all material respects with
applicable Securities Laws, and did not (or in the case
of reports, statements, or circulars filed after the
date of this Agreement, will not) contain any untrue
statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make
the statements made therein, in light of the
circumstances under which they were made, not
misleading.
(d) Financial Statements. Each of its balance sheets
included in the Financial Statements fairly presents
(or, in the case of Financial Statements for periods
ending on a date following the date of this Agreement,
will fairly present) the consolidated financial position
of it and its Subsidiaries as of the date of the balance
sheet. Each of the consolidated statements of income,
cash flows and stockholders' equity included in the
Financial Statements fairly presents (or, in the case of
Financial Statements for periods ending on a date
following the date of this Agreement, will fairly
present) the consolidated results of operations,
retained earnings and cash flows, as the case may be, of
it and its Subsidiaries for the periods set forth in
these statements (subject, in the case of unaudited
statements, to normal year-end audit adjustments), in
each case in accordance with generally accepted
accounting principles, consistently applied ("GAAP"),
except as may be noted in these statements.
(1) "Financial Statements" means: (i) in Glacier's
case, the Glacier Financial Statements (or for
periods ending on a date following the date of
this Agreement, the Subsequent Glacier Financial
Statements); and (ii) in Mountain West's case,
the Mountain West Financial Statements (or for
periods ending on a date following the date of
this Agreement, the Subsequent Mountain West
Financial Statements).
(2) "Glacier Financial Statements" means Glacier's
(i) audited consolidated statements of financial
condition as of December 31, 1998 and 1997, and
the related audited statements of income,
cashflows and changes in stockholders' equity
for each of the years ended December 31, 1998
and 1997; and (ii) unaudited consolidated
statements of financial condition as of the end
of each fiscal quarter following December 31,
1998 but preceding the date of this Agreement,
and the related unaudited statements of income,
cashflows and changes in stockholders' equity
for each such quarter.
(3) "Subsequent Glacier Financial Statements" means
unaudited balance sheets and related statements
of income and stockholders' equity for each of
the fiscal quarters ending after the date of
this Agreement and before Closing.
(4) "Mountain West Financial Statements" means
audited statements of financial condition as of
March 31, 1999, 1998 and 1997, and the related
audited statements of income, cashflows and
changes in stockholders' equity for each of the
years ended March 31, 1999, 1998 and 1997; and
(ii) unaudited consolidated
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statements of financial condition as of the end
of each fiscal quarter following March 31, 1999
but preceding the date of this Agreement, and
the related unaudited statements of income,
cashflows and changes in stockholders' equity
for each such quarter.
(5) "Subsequent Mountain West Financial Statements"
means unaudited balance sheets and related
statements of income and stockholders' equity
for each of Mountain West's fiscal quarters
ending after the date of this Agreement and
before Closing.
3.1.6 ABSENCE OF CERTAIN EVENTS AND CHANGES. Except as disclosed in
its Financial Statements and Reports, since December 31, 1998
(for Glacier) and March 31, 1999 (for Mountain West): (1) it and
its Subsidiaries have conducted their respective businesses only
in the ordinary and usual course of the businesses and (2) no
change or development or combination of changes or developments
has occurred that, individually or in the aggregate, is
reasonably likely to result in a Material Adverse Effect with
respect to it or its Subsidiaries. For purposes of this
Agreement, "Material Adverse Effect" with respect to any
corporation means an effect that: (1) is materially adverse to
the business, financial condition, results of operations or
prospects of the corporation and its Subsidiaries taken as a
whole; (2) significantly and adversely affects the ability of
the corporation to consummate the transactions contemplated by
this Agreement by the Termination Date or to perform its
material obligations under this Agreement; or (3) enables any
persons to prevent the consummation by the Termination Date of
the transactions contemplated by this Agreement. No Material
Adverse Effect will be deemed to have occurred on the basis of
any effect resulting from actions or omissions of the
corporation taken with the explicit prior consent of the other
party to this Agreement.
3.1.7 MATERIAL AGREEMENTS.
(a) Except for the Glacier and Mountain West Stock Plans,
respectively, and arrangements made after the date and
in accordance with the terms of this Agreement, it and
its Subsidiaries are not bound by any material contract
(as defined in Item 601(b)(10) of Regulation S-K under
the Securities Act) that: (1) is to be performed after
the date of this Agreement and (2) has not been filed
with or incorporated by reference in its Reports or set
forth in Schedule 5.
(b) Neither it nor any of its Subsidiaries is in default
under any contract, agreement, commitment, arrangement,
lease, insurance policy, or other instrument.
3.1.8 KNOWLEDGE AS TO CONDITIONS. Its President, Chief Executive
Officer, and Chief Financial Officer (collectively, "Executive
Officers") know of no reason the Regulatory Approvals and, to
the extent necessary, any other approvals, authorizations,
filings, registrations, and notices should not be obtained
without the imposition of any condition or restriction that is
reasonably likely to have a Material Adverse Effect with respect
to it, its Subsidiaries, or the Combined Bank, or the opinion of
the tax experts referred to in Subsection 5.2.13.
3.1.9 BROKERS AND FINDERS. Neither it, its Subsidiaries, nor any of
their respective officers, directors or employees has employed
any broker or finder or incurred any liability for any brokerage
fees, commissions or finder's fees in connection with the
transactions contemplated in this Agreement.
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3.2 MOUNTAIN WEST'S ADDITIONAL REPRESENTATIONS. Subject to Subsection 3.3
and except as expressly set forth in Schedule 1, Mountain West
represents to Glacier, the following:
3.2.1 LOAN AND LEASE LOSSES. Its Executive Officers know of no reason
why the allowance for loan and lease losses shown in the balance
sheets included in the Financial Statements for the periods
ended December 31, 1998, March 31, 1999, and June 30, 1999, was
not adequate as of those dates, respectively, to provide for
estimable and probable losses, net of recoveries relating to
loans not previously charged off, inherent in its loan
portfolio.
3.2.2 NO STOCK OPTION PLANS. Neither it nor any of its Subsidiaries
has adopted any stock option plans or granted any options or
rights to acquire any shares of Mountain West Common Stock or
capital stock or other ownership interest of any Mountain West
Subsidiary except as expressly set forth in Schedule 4.
3.2.3 GOVERNMENTAL FILINGS; NO VIOLATIONS.
(a) Filings. Other than the Regulatory Approvals and other
than as required under the Securities Act, the Exchange
Act, and state securities and "Blue Sky" laws, no
notices, reports or other filings are required to be
made by it with, nor are any consents, registrations,
approvals, permits or authorizations required to be
obtained by it from, any governmental or regulatory
authority, agency, court, commission or other entity,
domestic or foreign ("Governmental Entity"), in
connection with the execution, delivery or performance
of this Agreement by it and the consummation by it of
the Transaction.
(b) Violations. The execution, delivery and performance of
this Agreement does not and will not, and the
consummation by it of the Transaction will not,
constitute or result in: (1) a breach or violation of,
or a default under, its articles of incorporation or
bylaws, or the comparable governing instruments of any
of its Subsidiaries; (2) a breach or violation of, or a
default under, or the acceleration of or the creation of
a Lien (with or without the giving of notice, the lapse
of time or both) under, any provision of any agreement,
lease, contract, note, mortgage, indenture, arrangement
or other obligation ("Contracts") of it or any of its
Subsidiaries; or (3) a violation of any law, rule,
ordinance or regulation or judgment, decree, order,
award, or governmental or non-governmental permit or
license to which it or any of its Subsidiaries is
subject; or (4) any change in the rights or obligations
of any party under any of the Contracts. Schedule 6
contains a list of all consents it or its Subsidiaries
must obtain from third parties under any Contracts
before consummation of the Transaction.
3.2.4 ASSET CLASSIFICATION.
(a) Schedule 7 sets forth a list, accurate and complete as
of June 30, 1999, except as otherwise expressly noted in
Schedule 7, and separated by category of classification
or criticism ("Asset Classification"), of the aggregate
amounts of loans, extensions of credit and other assets
of it and its Subsidiaries that have been criticized or
classified by any Governmental Entity, by any outside
auditor, or by any internal audit.
(b) Except as shown on Schedule 7, no amounts of loans,
extensions of credit or other assets that have been
classified or criticized by any representative of any
Governmental Entity as "Other Assets Especially
Mentioned," "Substandard," "Doubtful," "Loss" or words
of similar effect are excluded from the amounts
disclosed in the Asset Classification, other
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than amounts of loans, extensions of credit or other
assets that were paid off or charged off by it or its
Subsidiaries before the date of this Agreement.
3.2.5 INVESTMENTS. Schedule 8 lists all investments (except
investments in securities issued by federal state or local
government or any subdivision or agency thereof and investments
in Subsidiaries) made by it or any of its Subsidiaries in an
amount greater than $25,000 or which represent an ownership
interest of more than 5% in any corporation, company,
partnership, or other entity. All investments comply with all
applicable laws and regulations.
3.2.6 PROPERTIES.
(a) Except as disclosed or reserved against in its Financial
Statements or in Schedule 9, it and its Subsidiaries
have good and marketable title, free and clear of all
Liens (other than Liens for current taxes not yet
delinquent or pledges to secure deposits) to all of the
properties and assets, tangible or intangible, reflected
in its Reports as being owned or leased by it or its
Subsidiaries as of the date of this Agreement.
(b) To the knowledge of its Executive Officers, all
buildings and all fixtures, equipment and other property
and assets that are material to its business on a
consolidated basis and are held under leases or
subleases by it or its Subsidiaries are held under valid
leases or subleases, enforceable in accordance with
their respective terms (except as may be limited by
applicable bankruptcy, insolvency, reorganization,
moratorium or other laws affecting creditors' rights
generally or by general equity principles).
(c) Schedule 10 lists all its and its Subsidiaries' existing
branches and offices and all new branches or offices it
or any of its Subsidiaries' has applied to establish or
purchase, along with the cost to establish or purchase
those branches.
(d) Mountain West has provided to Glacier copies of existing
title policies held in its files, and no exceptions,
reservations, or encumbrances have arisen or been
created since the date of issuance of those policies.
3.2.7 ANTI-TAKEOVER PROVISIONS. It and each of its Subsidiaries have
taken all necessary action to exempt the Transaction and this
Agreement from (a) all applicable Idaho State law anti-takeover
provisions, if any, and (b) any takeover-related provisions of
its articles of incorporation or bylaws.
3.2.8 COMPLIANCE WITH LAWS. Except as disclosed in Schedule 11, it and
each of its Subsidiaries:
(a) are in compliance, in the conduct of their businesses,
with all applicable federal, state, local, and foreign
statutes, laws, regulations, ordinances, rules,
judgments, orders or decrees, including the Bank Secrecy
Act, the Truth in Lending Act, the Equal Credit
Opportunity Act, the Fair Housing Act, the Community
Reinvestment Act, the Home Mortgage Disclosure Act and
all applicable fair lending laws or other laws relating
to discrimination;
(b) have all permits, licenses, certificates of authority,
orders, and approvals of, and have made all filings,
applications, and registrations with, federal, state,
local, and foreign governmental or regulatory bodies
(including the Federal Reserve, FDIC and OTS) that
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are required in order to permit them to carry on their
businesses as they are presently conducted;
(c) have received since January 1, 1996, no notification or
communication from any Governmental Entity (including
any bank, insurance and securities regulatory
authorities) or its staff (1) asserting a failure to
comply with any of the statutes, regulations or
ordinances that such Governmental Entity enforces, (2)
threatening to revoke any license, franchise, permit or
governmental authorization, or (3) threatening or
contemplating revocation or limitation of, or that would
have the effect of revoking or limiting, FDIC deposit
insurance (nor, to the knowledge of its Executive
Officers, do any grounds for any of the foregoing
exist); and
(d) are not required to notify any federal banking agency
before adding directors to its board of directors or
employing senior executives.
3.2.9 LITIGATION. Except as disclosed in its Financial Statements or
in Schedule 12, before the date of this Agreement:
(a) no criminal or administrative investigations or
hearings, before or by any Governmental Entity, or
civil, criminal or administrative actions, suits, claims
or proceedings, before or by any person (including any
Governmental Entity) are pending or, to the knowledge of
its Executive Officers, threatened, against it or any of
its Subsidiaries (including under the Truth in Lending
Act, the Equal Credit Opportunity Act, the Fair Housing
Act, the Community Reinvestment Act, the Home Mortgage
Disclosure Act, or any other fair lending law or other
law relating to discrimination); and
(b) neither it nor any of its Subsidiaries (nor any officer,
director, controlling person or property of it or any of
its Subsidiaries) is a party to or is subject to any
order, decree, agreement, memorandum of understanding or
similar arrangement with, or a commitment letter or
similar submission to, any Governmental Entity charged
with the supervision or regulation of depository
institutions or engaged in the insurance of deposits
(including the FDIC) or the supervision or regulation of
it or of its Subsidiaries, and neither it nor any of its
Subsidiaries has been advised by any such Governmental
Entity that such Governmental Entity is contemplating
issuing or requesting (or is considering the
appropriateness of issuing or requesting) any such
order, decree, agreement, memorandum of understanding,
commitment letter or similar submission.
3.2.10 TAXES. For purposes of this Subsection 3.2.10, "Tax" includes
any tax or similar governmental charge, impost, or levy
(including income taxes, franchise taxes, transfer taxes or
fees, stamp taxes, sales taxes, use taxes, excise taxes, ad
valorem taxes, withholding taxes, worker's compensation, payroll
taxes, unemployment insurance, social security, minimum taxes,
or windfall profits taxes), together with any
related liabilities, penalties, fines, additions to tax, or
interest, imposed by the United States or any state, county,
provincial, local or foreign government or subdivision or agency
of the United States.
(a) All federal, state and local Tax returns, including all
information returns, it and its Subsidiaries are
required to file have been timely filed or requests for
extensions have been timely filed. If any extensions
were filed, they have been or will be granted by Closing
and will not have expired. All filed returns are
complete and accurate in all material respects.
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(b) Except as disclosed in its Financial Statements:
(1) all taxes attributable to it or any of its
Subsidiaries that are or were due or payable
(without regard to whether such taxes have been
assessed) have been paid in full or have been
adequately provided for in its Financial
Statements in accordance with GAAP;
(2) adequate provision in accordance with GAAP has
been made in its Financial Statements relating
to all Taxes for the periods covered by such
Financial Statements that were not yet due and
payable as of the date of this Agreement,
regardless of whether the liability for such
Taxes is disputed;
(3) as of the date of this Agreement and except as
disclosed in its Financial Statements, there is
no outstanding audit examination, deficiency,
refund, litigation or outstanding waiver or
agreement extending the applicable statute of
limitations for the assessment or collection of
any Taxes for any period with respect to any
Taxes of it or its Subsidiaries;
(4) all Taxes with respect to completed and settled
examinations or concluded litigation relating to
it or any of its Subsidiaries have been paid in
full or have been recorded on its Financial
Statements (in accordance with GAAP);
(5) neither it nor any of its Subsidiaries is a
party to a Tax sharing or similar agreement or
any agreement under which it or any of its
Subsidiaries has indemnified any party (other
than it or one of its Subsidiaries) with respect
to Taxes; and
(6) the proper and accurate amounts have been
withheld from all employees (and timely paid to
the appropriate Governmental Entity or set aside
in an account for these purposes) for all
periods through the Effective Date in compliance
with all Tax withholding provisions of
applicable federal, state, local and foreign
laws (including income, social security and
employment tax withholding for all types of
compensation).
3.2.11 INSURANCE. It and each of its Subsidiaries has taken all
requisite action (including the making of claims and the giving
of notices) under its directors' and officers' liability
insurance policy or policies in order to preserve all rights
under such policies with respect to all matters known to it
(other than matters arising in connection with, and the
transactions contemplated by, this Agreement). Schedule 13 lists
all directors' and officers' liability insurance policies and
other insurance policies maintained by it or its Subsidiaries.
3.2.12 LABOR MATTERS. Neither it nor any of its Subsidiaries is a party
to, or is bound by, any collective bargaining agreement,
contract or other agreement or understanding with any labor
union or labor organization. Neither it nor any of its
Subsidiaries is the subject of any proceeding: (1) asserting
that it or any of its Subsidiaries has committed an unfair labor
practice or (2) seeking to compel it or any of its Subsidiaries
to bargain with any labor organization as to wages or conditions
of employment. No strike involving it or any of its Subsidiaries
is pending or, to the knowledge of its Executive Officers,
threatened. Its Executive Officers are not aware of any activity
involving its or any of its Subsidiaries' employees seeking to
certify a collective bargaining unit or engaging in any other
organizational activity.
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3.2.13 YEAR 2000 COMPLIANCE. It and its Subsidiaries are Year 2000
Compliant and have received "Satisfactory" ratings by the
appropriate banking regulatory authorities. For purposes of this
Agreement, "Year 2000 Compliant" means that Mountain West's
Information Technology is designed to be used prior to, during,
and after the calendar Year 2000 A.D., and the Information
Technology used during each such time period will accurately
receive, provide and process date/time data (including, but not
limited to, calculating, comparing and sequencing) from, into
and between the twentieth and twenty-first centuries, including
the years 1999 and 2000, and leap year calculations and will not
malfunction, cease to function, or provide invalid or incorrect
results as a result of date/time data, to the extent that other
Information Technology, used in combination with the Information
Technology being acquired, properly exchanges date/time data
with it. For purposes of this Agreement, "Information
Technology" includes computer software, computer firmware,
computer hardware (whether general or specific purpose), and
other similar or related automated or computerized items that
are used or relied on by Mountain West or any if its
Subsidiaries in the conduct of their businesses.
3.2.14 EMPLOYEE BENEFITS.
(a) For purposes of this Agreement, "Plan" or "Plans",
individually or collectively, means any "employee
benefit plan," as defined in Section 3(3) of the
Employee Retirement Income Security Act of 1974,
("ERISA"), as amended, maintained by Mountain West or
any of its Subsidiaries, as the case may be. Mountain
West and its Subsidiaries are not now nor have they ever
been contributing employers to or sponsors of a
multi-employer plan or a single employer plan subject to
Title IV of ERISA.
(b) Schedule 14 sets forth a list, as of the date of this
Agreement, of (1) all Plans, stock purchase plans,
restricted stock and stock option plans, and other
deferred compensation arrangements, (2) all other
material employee benefit plans that cover employees or
former employees of it and its Subsidiaries (its
"Compensation Plans"). True and complete copies of the
Compensation Plans (and, as applicable, copies of
summary plan descriptions, annual reports on Form 5500,
actuarial reports and reports under Financial Accounting
Standards Board Statement No. 106 relating to such
Compensation Plans) covering current or former employees
or directors of it or its Subsidiaries (its
"Employees"), including Plans and related amendments,
have been made available to Glacier.
(c) All Plans (other than "multi-employer plans" within the
meaning of ERISA Sections 3(37) or 4001(a)(3)), to the
extent subject to ERISA, are in substantial compliance
with ERISA. Each Plan, that is an "employee pension
benefit plan" within the meaning of ERISA Section 3(2)
("Pension Plan") and that is intended to be qualified
under IRC Section 401(a), has received a favorable
determination letter from the Internal Revenue Service,
and it is not aware of any circumstances likely to
result in revocation of any such favorable determination
letter. No litigation relating to Plans is pending or,
to the knowledge of its Executive Officers, threatened.
Neither it nor any of its Subsidiaries has engaged in a
transaction with respect to any Plan that could subject
it or its Subsidiaries to a Tax or penalty imposed by
either IRC Section 4975 or ERISA Section 502(i).
(d) All material contributions it or any of its Subsidiaries
are or were required to make under the terms of any
Plans have been timely made or have been reflected in
its Financial Statements. No Plan of it or its
subsidiaries has an "accumulated funding deficiency"
(whether or not waived) within the meaning of IRC
Section 412 or ERISA Section 302.
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Neither it nor any of its Subsidiaries has provided, or
is required to provide, security to any Pension Plan
under IRC Section 401(a)(29), IRC Section 412(f)(3), or
ERISA Sections 306, 307 or 4204.
(e) Except as disclosed in its Financial Statements, neither
it nor its Subsidiaries have any obligations for retiree
health and life benefits.
(f) No restrictions exist on the rights of it or its
Subsidiaries to amend or terminate any Plan without
incurring liability under the Plan in addition to normal
liabilities for benefits.
(g) Except as disclosed in its Financial Statements or as
provided in a Schedule to this Agreement, the
transactions contemplated by this Agreement and the
Stock Plans will not result in: (1) vesting,
acceleration, or increase of any amounts payable under
any Compensation Plan, (2) any material increase in
benefits under any Compensation Plan or (3) payment of
any severance or similar compensation under any
Compensation Plan.
3.2.15 ENVIRONMENTAL MATTERS.
(a) For purposes of this Subsection 3.2.15, the following
definitions apply:
(1) "Subject Property" with respect to a party means
(i) all real property at which the businesses of
it or its Subsidiaries have been conducted, and
any property where under any Environmental Law
it or any of its Subsidiaries is deemed to be
the owner or operator of the property; (ii) any
facility in which it or its Subsidiaries
participates in the management, including
participating in the management of the owner or
operator of the property; and (iii) all other
real property that, for purposes of any
Environmental Law, it or any of its Subsidiaries
otherwise could be deemed to be an owner or
operator of or as otherwise having control over.
(2) "Environmental Laws" means any federal, state,
local or foreign law, regulation, agency policy,
order, decree, judgment, judicial opinion, or
any agreement with any Governmental Entity,
presently in effect or subsequently adopted
relating to: (i) the manufacture, generation,
transport, use, treatment, storage, recycling,
disposal, release, threatened release or
presence of Hazardous Substances, or (ii) the
preservation, restoration or protection of the
environment, natural resources or human health.
(3) "Hazardous Substances" means any hazardous or
toxic substance, material or waste that is
regulated by any local governmental authority,
any state government or the United States
Government, including any material or substance
that is (a) defined as a "hazardous substance"
in 42 USC Section 9601(14), (b) defined as a
"pollutant or contaminant" in 42 USC Section
9604(a)(2), or (c) defined as a "hazardous
waste" in 42 USC Section 6903(5).
(b) It and each of its Subsidiaries and the Subject Property
are, and have been, in compliance with all applicable
Environmental Laws, and no circumstances exist that with
the passage of time or the giving of notice would be
reasonably likely to result in noncompliance with such
Environmental Laws.
(c) None of the following, and no reasonable basis for any
of the following, exists: pending or threatened claims,
actions, investigations, notices of non-compliance,
information
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requests or notices of potential responsibility or
proceedings involving it or any of its Subsidiaries or
any Subject Property, relating to:
(1) an asserted liability of it or any of its
Subsidiaries or any prior owner, occupier or
user of Subject Property under any applicable
Environmental Law or the terms and conditions of
any permit, license, authority, settlement,
agreement, decree or other obligation arising
under any applicable Environmental Law;
(2) the handling, storage, use, transportation,
removal or disposal of Hazardous Substances;
(3) the actual or threatened discharge, release or
emission of Hazardous Substances from, on or
under or within Subject Property into the air,
water, surface water, ground water, land surface
or subsurface strata; or
(4) personal injuries or damage to property related
to or arising out of exposure to Hazardous
Substances.
(d) No storage tanks underground or otherwise are present on
the Subject Property or, if present, none of such tanks
are leaking and each of them is in full compliance with
all applicable Environmental Laws. With respect to any
Subject Property, it and its Subsidiaries do not own,
possess or control any PCBs, PCB-contaminated fluids,
wastes or equipment, or any material amount of asbestos
or asbestos-containing material. No Hazardous Substances
have been used, handled, stored, discharged, released or
emitted, or are threatened to be discharged, released or
emitted, at or on any Subject Property, except for those
types and quantities of Hazardous Substances typically
used in an office environment and that have not created
conditions requiring remediation under any applicable
Environmental Law.
(e) Except for the investigation or monitoring by the
Environmental Protection Agency or similar state
agencies in the ordinary course, no part of the Subject
Property has been or is scheduled for investigation or
monitoring under any applicable Environmental Law.
3.3 EXCEPTIONS TO REPRESENTATIONS.
3.3.1 DISCLOSURE OF EXCEPTIONS. Each exception set forth in a Schedule
is disclosed only for purposes of the representations referenced
in that exception; but the following conditions apply:
(a) no exception is required to be set forth in a Schedule
if its absence would not result in the related
representation being found untrue or incorrect under the
standard established by Subsection 3.3.2; and
(b) the mere inclusion of an exception in a Schedule is not
an admission by a party that such exception represents a
material fact, material set of facts, or material event
or would result in a Material Adverse Effect with
respect to that party.
3.3.2 NATURE OF EXCEPTIONS. No representation contained in Subsections
3.1 or 3.2 will be found untrue or incorrect and no party to
this Agreement will have breached a representation due to the
following: the existence of any fact, set of facts, or event, if
the fact or event individually or taken together with other
facts or events would not, or, in the case of Subsection 3.2.9,
is not reasonably likely to, have a Material Adverse Effect with
respect to such party.
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SECTION 4
CONDUCT AND TRANSACTIONS
BEFORE CLOSING
4.1 CONDUCT OF MOUNTAIN WEST'S BUSINESS BEFORE CLOSING. Before Closing,
Mountain West promises as follows:
4.1.1 AVAILABILITY OF MOUNTAIN WEST'S BOOKS, RECORDS AND PROPERTIES.
(a) Mountain West will make its, and cause its Subsidiaries
to make their, books, records, properties, contracts and
documents available at all reasonable times to Glacier
and its counsel, accountants and other representatives.
These items will be open for inspection, audit and
direct verification of: (1) loan or deposit balances,
(2) collateral receipts and (3) any other transactions
or documentation Glacier may find reasonably relevant to
the Transaction. Mountain West will, and will cause its
Subsidiaries to, cooperate fully in any such inspection,
audit, or direct verification procedures, and Mountain
West will, and will cause its Subsidiaries to, make
available all information reasonably required by or on
behalf of Glacier.
(b) At Glacier's request, Mountain West will request any
third parties involved in the preparation or review of
(1) Mountain West Financial Statements, (2) Subsequent
Mountain West Financial Statements, or (3) any audits of
Mountain West's operations, loan portfolios or other
assets, to disclose to Glacier the work papers or any
similar materials related to these items.
4.1.2 ORDINARY AND USUAL COURSE. Mountain West will, and will cause
its Subsidiaries to, conduct business only in the ordinary and
usual course and, without the prior written consent of Glacier,
will not, and will not allow its Subsidiaries to, do any of the
following:
(a) effect any stock split or other recapitalization with
respect to Mountain West Common Stock or the capital
stock of a Mountain West Subsidiary, or issue, pledge,
redeem, or encumber in any way any shares of Mountain
West's or a Mountain West Subsidiary's capital stock,
except shares issued pursuant to the exercise of
Mountain West Stock Options; or grant any option or
other right to shares of Mountain West's or a Mountain
West Subsidiary's capital stock;
(b) declare or pay any dividend, or make any other
distribution, either directly or indirectly, with
respect to Mountain West Common Stock or the capital
stock of any Mountain West Subsidiary;
(c) acquire, sell, transfer, assign, encumber or otherwise
dispose of assets or make any commitment with respect to
its assets other than in the ordinary and usual course
of business;
(d) solicit or accept deposit accounts of a different type
from accounts previously accepted by it or at rates
materially in excess of rates previously paid by it,
except to reflect changes in prevailing interest rates,
or incur any indebtedness greater than $25,000 (except
for borrowings from the Federal Home Loan Bank in the
ordinary course of business and consistent with past
practices);
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(e) acquire an ownership interest or a leasehold interest in
any Property or any other real property, whether by
foreclosure or otherwise, without: (1) making an
appropriate environmental evaluation in advance of
obtaining the interest and providing the evaluation to
Glacier and (2) (without giving effect to the
introductory paragraph of this Subsection 4.1.2)
providing Glacier with prompt written notice as required
by Subsection 4.8.
(f) subject to the exercise of its board of directors'
fiduciary duties and on the advice of counsel, enter
into or recommend the adoption by Mountain West's
stockholders of any agreement involving a possible
merger or other business combination or asset sale by
Mountain West not involving the Transaction;
(g) enter into, renew, or terminate any contracts (including
real property leases and data or item processing
agreements) with or for a term of one-year or more,
except for its contracts of deposit and agreements to
lend money not otherwise restricted under this Agreement
and (1) entered into in the ordinary course of business,
(2) consistent with past practices, and (3) providing
for not less (in the case of loans) or more (in the case
of deposits) than prevailing market rates of interest;
(h) enter into or amend any contract (other than contracts
for deposits or agreements to lend money not otherwise
restricted by this Agreement) calling for a payment by
it of more than $25,000, unless the contract may be
terminated without cause or penalty upon 30 days notice
or less;
(i) enter into any personal services contract with any
person or firm, except contracts, agreements, or
arrangements for legal, accounting, investment advisory,
or tax services entered into directly to facilitate the
Transaction;
(j) (1) sell any securities, whether held for investment or
sale, other than in the ordinary course of business or
sell any securities, whether held for investment or
sale, even in the ordinary course of business, if the
aggregate gain realized from all sales after the date of
this Agreement would be more than $60,000 or (2)
transfer any investment securities between portfolios of
securities available for sale and portfolios of
securities to be held to maturity;
(k) amend its articles of incorporation, bylaws, or other
formation agreements, or convert its charter or form of
entity;
(l) implement or adopt any material changes in its
operations, policies, or procedures, including loan loss
reserve policies, unless the changes are requested by
Glacier or are necessary or advisable, on the advice of
legal counsel, to comply with applicable laws,
regulations, or regulatory policies;
(m) implement or adopt any change in its accounting
principles, practices or methods, other than as may be
required (1) by GAAP, (2) for tax purposes, or (3) to
take advantage of any beneficial tax or accounting
methods;
(n) other than in accordance with binding commitments
existing on the date of this Agreement, make any capital
expenditures in excess of $10,000 per project or related
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series of projects or $25,000 in the aggregate, except
for expenses reasonably related to completion of the
Transaction, which expenses may not exceed $60,000; or
(o) enter into any other transaction or make any expenditure
other than in the ordinary and usual course of its
business and made or entered into in a manner consistent
with its well-established practices or as required by
this Agreement.
4.1.3 CONDUCT REGARDING REPRESENTATIONS. Mountain West will not do or
cause to be done anything that would cause any representation in
Subsection 3.1 or 3.2 to be untrue at Closing, except as
otherwise contemplated or required by this Agreement or
consented to in writing by Glacier.
4.1.4 MAINTENANCE OF PROPERTIES. Mountain West will maintain its
properties and equipment (and related insurance or its
equivalent) in accordance with good business practice.
4.1.5 PRESERVATION OF BUSINESS ORGANIZATION. Mountain West will use
all reasonable efforts to:
(a) preserve its business organization;
(b) retain the services of present management; and
(c) preserve the goodwill of suppliers, customers and others
with whom it has business relationships.
4.1.6 SENIOR MANAGEMENT. Except for (1) changes consistent with past
practice and (2) the hiring of a commercial loan officer in
Boise, Mountain West will not make any change, including hiring
of replacements, with respect to present management personnel
having the rank of vice-president or higher.
4.1.7 COMPENSATION AND EMPLOYMENT AGREEMENTS. Mountain West will not
permit any increase in the current or deferred compensation
payable or to become payable by Mountain West to any of its
directors, officers, employees, agents, or consultants other
than normal increments in compensation in accordance with
Mountain West's past practices with respect to the timing and
amounts of such increments. Except as contemplated in this
Agreement, Mountain West will not commit to, execute or deliver
any employment agreement with any party not terminable upon two
weeks' notice and without expense.
4.1.8 UPDATE OF FINANCIAL STATEMENTS. Mountain West will promptly
deliver its Financial Statements to Glacier. Mountain West will
deliver Subsequent Mountain West Financial Statements to Glacier
by the earlier of: (1) 5 days after Mountain West has prepared
and issued them or (2) 60 days after year-end for year-end
statements and 30 days after the end of the quarter for
quarterly statements. The Subsequent Mountain West Financial
Statements:
(a) will be prepared from the books and records of Mountain
West;
(b) will present fairly the financial position and operating
results of Mountain West at the times indicated and for
the periods covered;
(c) will be prepared in accordance with GAAP (except for the
absence of notes) and with the regulations promulgated
by applicable regulatory authorities, to the extent then
applicable, subject to normal year-end adjustments; and
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(d) will reflect all Mountain West's liabilities, contingent
or otherwise, on the respective dates and for the
respective periods covered, except for liabilities: (1)
not required to be so reflected in accordance with GAAP
or (2) not significant in amount.
4.1.9 NO SOLICITATION. Neither Mountain West nor any of its officers
or directors, directly or indirectly, will solicit, encourage,
entertain, or facilitate any other proposals or inquiries for an
acquisition of the shares or assets of Mountain West or its
Subsidiaries or enter into discussions concerning any such
acquisition, except as otherwise required to comply with the
fiduciary responsibilities of Mountain West's board of
directors. No such party will make available to any person not
affiliated with Mountain West or Glacier any information about
its business or organization that is not either routinely made
available to the public generally or required by law.
4.1.10 TITLE POLICIES. No later than 30 days after the execution of
this Agreement, Mountain West will provide Glacier with title
reports issued by a title insurance company reasonably
satisfactory to Glacier. These title reports must show
unencumbered fee simple title or vendee's interest to all real
Property owned by Mountain West or any of its Subsidiaries and
unencumbered leasehold interests in all real Property leased by
Mountain West or any of its Subsidiaries, and these title
reports may contain only such exceptions, reservations, and
encumbrances as may be consented to in writing by Glacier, which
consent Glacier may not unreasonably withhold. At Closing,
Mountain West will provide Glacier with update endorsements,
dated as of the Effective Date, to the title policies for each
Property owned by it or any of its Subsidiaries. For purposes of
this Agreement, "Property" includes any property that Mountain
West or any of its Subsidiaries owns or leases, other than other
real estate owned.
4.1.11 REVIEW OF LOANS. Mountain West will permit Glacier to conduct an
examination of Mountain West's loans to determine credit quality
and the adequacy of Mountain West's allowance for loan losses.
Glacier will have continued access to Mountain West's loans
through Closing to update the examination. At Glacier's
reasonable request, Mountain West will provide Glacier with
current reports updating the information set forth in Schedule
7.
4.2 REGISTRATION STATEMENT.
4.2.1 PREPARATION OF REGISTRATION STATEMENT.
(a) A Registration Statement on Form S-4 ("Registration
Statement") will be filed by Glacier with the SEC under
the Securities Act for registration of the Glacier
Shares, and the parties will prepare a related
prospectus/proxy statement ("Prospectus/Proxy
Statement") to be mailed together with any amendments
and supplements to Mountain West's stockholders.
(b) The parties will cooperate with each other in preparing
the Registration Statement and Prospectus/Proxy
Statement, and will use their best efforts to: (1) file
the Registration Statement with the SEC within 60 days
following the date on which this Agreement is executed,
and (2) obtain the clearance of the SEC, any appropriate
state securities regulators and any other required
regulatory approvals, to issue the Prospectus/Proxy
Statement.
(c) Nothing will be included in the Registration Statement
or the Prospectus/Proxy Statement or any proxy
solicitation materials with respect to any party to this
Agreement unless approved by that party, which approval
will not be unreasonably withheld.
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(d) Glacier will pay all costs associated with the
preparation by Glacier's counsel and the filing of the
Registration Statement. Mountain West will pay all costs
associated with the review and preparation by Mountain
West's counsel of the Registration Statement and the
Prospectus/Proxy. Mountain West will pay the costs
associated with the printing and mailing of the
Prospectus/Proxy Statement to its stockholders and any
other direct costs incurred by it in connection with the
Prospectus/Proxy Statement.
4.2.2 SUBMISSION TO STOCKHOLDERS.
(a) Glacier and Mountain West will submit the
Prospectus/Proxy Statement to, and will use their best
efforts in good faith to obtain the prompt approval of
the Prospectus/Proxy Statement by, all applicable
regulatory authorities. The parties will provide each
other with copies of such submissions for review.
(b) Mountain West will promptly take the actions necessary
in accordance with applicable law and its Articles of
Incorporation and Bylaws to convene a stockholders'
meeting to consider the approval of this Agreement and
to authorize the transactions contemplated by this
Agreement. This stockholders' meeting will be held on
the earliest practical date after the date the
Prospectus/Proxy Statement may first be sent to Mountain
West's stockholders without objection by applicable
governmental authorities; but Mountain West will have at
least 20 calendar days to solicit proxies. Except as
otherwise required to comply with the fiduciary
responsibilities of its board of directors, Mountain
West's board of directors and officers will recommend
approval of the Transaction to Mountain West's
stockholders.
4.3 ACCOUNTING TREATMENT.
4.3.1 POOLING OF INTERESTS. The parties intend the Merger to be
treated as a "pooling of interests" for accounting purposes.
From the date of this Agreement through the Effective Date,
neither Glacier nor Mountain West nor any of their respective
Subsidiaries or other affiliates (a) will knowingly take any
action or enter into any contract, agreement, commitment or
arrangement that would jeopardize the treatment of the Merger as
a "pooling of interests;" or (b) will knowingly fail to take any
action that would preserve the treatment of the Merger as a
"pooling of interests." No action or omission by either party
will constitute a breach of this Subsection 4.3.1 if the action
is permitted or required under this Agreement or is made with
the other party's written consent, or as required by applicable
laws or regulations.
4.3.2 AFFILIATE LIST. Certain persons may be deemed "affiliates" of
Mountain West under Securities Act Rule 145, the SEC's
Accounting Series Releases ("ASR") 130 and 135, or other rules
and releases related to "pooling of interests" accounting
treatment. Within thirty days following the date this Agreement
is signed, Mountain West will deliver to Glacier, after
consultation with legal counsel, a list of names and addresses
of Mountain West's "affiliates" with respect to the Transaction
within the meaning of Rule 145 or ASR 130 and 135. By the
Effective Date, Mountain West will deliver, or cause to be
delivered, to Glacier a letter from each of these "affiliates,"
and any additional person who becomes an "affiliate" before the
Effective Date and after the date of the list, dated as of the
date of its delivery and in the form attached as Exhibit C.
4.3.3 RESTRICTIVE LEGENDS. Glacier will place a restrictive legend on
all certificates representing Glacier Shares to be received by
an "affiliate," so as to preclude their transfer or disposition
in violation of the affiliate letters. Glacier will also
instruct its transfer agent not to permit the transfer of those
shares, and to take any other steps reasonably necessary to
ensure compliance
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with the Securities Act Rule 145 or the SEC's XXX 000 and 135 or
other rules and releases related to "pooling of interests"
accounting treatment.
4.3.4 RETENTION OF CERTIFICATES. Except as otherwise permitted in
Exhibit A, by a date at least 30 days before the Effective Date,
all stock certificates evidencing ownership of Mountain West
Common Stock by "affiliates" will be delivered to Mountain West.
Mountain West (before the Effective Date) and Glacier (after the
Effective Date) will retain those certificates, and subsequently
the certificates representing Glacier shares for which they are
exchanged, until financial results covering at least 30 days of
combined operations for Glacier following the Effective Date
have been published, at which time the certificates will be
released.
4.4 SUBMISSION TO REGULATORY AUTHORITIES. Representatives of Glacier, at
Glacier's expense, will prepare and file with applicable regulatory
agencies, applications for approvals, waivers or other actions their
counsel finds necessary or desirable in order to consummate the
Transaction. Glacier will provide copies of these applications for
Mountain West's review. These applications and filings are expected to
include:
(a) any necessary applications to the Federal Reserve and the FDIC;
and
(b) any filings required under the Idaho Bank Act;
4.5 ANNOUNCEMENTS. The parties will cooperate and consult with each other in
the development and distribution of all news releases and other public
information disclosures with respect to this Agreement or the
Transaction, unless otherwise required by law.
4.6 CONSENTS. Glacier and Mountain West will use their best efforts to
obtain the consent or approval of any person, organization or other
entity whose consent or approval is required in order to consummate the
Transaction.
4.7 FURTHER ACTIONS. Glacier and Mountain West, respectively, in the name
and on behalf of those respective parties, will use their best efforts
in good faith to make all such arrangements, do or cause to be done all
such acts and things, and execute and deliver all such certificates and
other instruments and documents as may be reasonably necessary or
appropriate in order to consummate the Transaction as promptly as
practicable.
4.8 NOTICE. Mountain West will provide Glacier with prompt written notice of
the following:
(a) any events, individually or in the aggregate, that could have a
Material Adverse Effect with respect to Mountain West;
(b) the commencement of any proceeding against Mountain West, or any
of its Subsidiaries or affiliates, by or before any court or
governmental agency that, individually or in the aggregate,
might have a Material Adverse Effect with respect to Mountain
West; or
(c) any acquisition of an ownership or leasehold interest in real
property, other than an acquisition in good faith of real
property to satisfy a debt previously contracted for.
4.9 CONFIDENTIALITY. Glacier and Mountain West each will hold in confidence
all nonpublic information obtained from the other in connection with the
Transaction, other than information that: (1) is required by law to be
disclosed; (2) is otherwise available on a nonconfidential basis; (3)
has become public without fault of the disclosing party; or (4) is
necessary to the defense of one of the parties in a legal or
administrative action brought against that party by the other party. If
the Transaction is not completed,
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Glacier and Mountain West will: (1) each return to the others all
confidential documents obtained from them and (2) not use any nonpublic
information obtained under this Agreement or in connection with the
Transaction.
4.10 UPDATE OF FINANCIAL STATEMENTS. Glacier will promptly deliver its
Financial Statements to Mountain West. Glacier will deliver Subsequent
Glacier Financial Statements to Mountain West by the earlier of: (1) 5
days after Glacier prepares and issues them or (2) 60 days after
year-end for year-end statements and 30 days after the end of the
quarter for quarterly statements. The Subsequent Glacier Financial
Statements will:
(a) be prepared from the books and records of Glacier;
(b) present fairly the financial position and operating results of
Glacier at the times indicated and for the periods covered;
(c) be prepared in accordance with GAAP (except for the absence of
notes) and with the regulations promulgated by applicable
regulatory authorities, to the extent then applicable, subject
to normal year-end adjustments; and
(d) reflect all liabilities, contingent or otherwise, of Glacier on
the respective dates and for the respective periods covered,
except for liabilities not required to be so reflected in
accordance with GAAP or not significant in amount.
4.11 AVAILABILITY OF GLACIER'S BOOKS, RECORDS AND PROPERTIES. Glacier will
make available to Mountain West true and correct copies of its
Certificate of Incorporation and Bylaws. At Mountain West's reasonable
request, Glacier will also provide Mountain West with copies of: (1)
reports filed with the SEC or banking regulators, (2) Glacier's stock
option plans, and (3) any other information that the parties agree upon.
SECTION 5
APPROVALS AND CONDITIONS
5.1 REQUIRED APPROVALS. The obligations of the parties to this Agreement are
subject to the approval of the Agreement and the Transaction by all
appropriate regulatory agencies having jurisdiction with respect to the
Transaction.
5.2 CONDITIONS TO GLACIER'S OBLIGATIONS. All Glacier's obligations under
this Agreement are subject to satisfaction of the following conditions
at or before Closing:
5.2.1 REPRESENTATIONS. Mountain West's representations in this
Agreement and in any certificate or other instrument delivered
in connection with this Agreement are true and correct in all
material respects at Closing (except to the extent that they
expressly relate to an earlier date, in which case they are true
in all material respects as of that earlier date). These
representations have the same force and effect as if they had
been made at Closing. Mountain West has delivered to Glacier its
certificate, executed by a duly authorized officer of Mountain
West and dated as of Closing, stating that these representations
comply with this Subsection 5.2.1.
5.2.2 COMPLIANCE. Mountain West has performed and complied with all
material terms, covenants and conditions of this Agreement.
Mountain West has delivered to Glacier its certificate, executed
by a duly authorized officer of Mountain West and dated as of
Closing, stating that Mountain West is in compliance with this
Subsection 5.2.2.
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5.2.3 EQUITY CAPITAL REQUIREMENT. The Tangible Equity Capital,
determined in accordance with GAAP, of Mountain West as of the
Effective Date is at least $6.3 million. Mountain West's
certificate referred to in Subsection 5.2.2 must confirm that
this condition is satisfied. "Tangible Equity Capital" means
common stock, paid in capital, retained earnings, and minus
goodwill and any other intangible assets, without giving effect
to any impact from gains or losses on available for sale
securities.
5.2.4 TRANSACTION FEES. Mountain West's Transaction Fees have not
exceeded $60,000. "Transaction Fees" means all costs and
expenses incurred by Mountain West or owed or paid by Mountain
West to third parties in connection with the preparation,
negotiation and execution of this Agreement and related
documents and the consummation of the Transaction, including
expenses incurred by Mountain West in connection with obtaining
approvals for the Transaction from regulators and stockholders,
not including exercise of options or any expenses incurred under
Subsection 4.1.10.
5.2.5 TRANSACTION FEES STATEMENTS. Mountain West has delivered to
Glacier a statement, in a form reasonably satisfactory to
Glacier, from each third party to whom Mountain West has paid or
owes Transaction Fees. Each statement must set forth the total
costs and expenses paid or owing to the third party in
connection with the Transaction's consummation. Mountain West
has delivered to Glacier its certificate, executed by a duly
authorized officer of Mountain West and dated as of Closing,
stating the total Transaction Fees incurred by Mountain West and
certifying that Mountain West is in compliance with Subsection
5.2.4 and this Subsection 5.2.5.
5.2.6 NO MATERIAL ADVERSE EFFECT. No damage, destruction, or loss
(whether or not covered by insurance) or other event or sequence
of events has occurred which, individually or in the aggregate,
has had or potentially may have a Material Adverse Effect with
respect to Mountain West. Mountain West's certificate referred
to in Subsection 5.2.1 states that the conditions identified in
this Subsection 5.2.6 are satisfied.
5.2.7 FINANCIAL CONDITION. The following are true, and Mountain West's
certificate referred to in Subsection 5.2.1 confirms the truth
of the following:
(a) Mountain West's allowance for possible loan and lease
losses at Closing was and is adequate to absorb the
anticipated loan and lease losses (taking into account
any recommendations made by Mountain West's certified
public accountants);
(b) the reserves set aside for the contingent liabilities
reflected in the Subsequent Mountain West Financial
Statements are adequate to absorb all reasonably
anticipated losses; and
(c) Mountain West's deposits at Closing, excluding brokered
deposits and jumbo certificates of deposit, total at
least $69 million.
5.2.8 NO CHANGE IN LOAN REVIEW. Mountain West has provided to Glacier
the reports reasonably requested by Glacier under Subsection
4.1.11, and neither these reports nor any examinations conducted
by Glacier under Subsection 4.1.11 reveal a material adverse
change in either: (1) the information set forth in Schedule 7 or
(2) information revealed during Glacier's previous examinations
of the Mountain West's loans.
5.2.9 NO GOVERNMENTAL PROCEEDINGS. No action or proceeding has been
commenced or threatened by any governmental agency to restrain
or prohibit or invalidate the Transaction.
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5.2.10 APPROVAL BY COUNSEL. All actions, proceedings, instruments, and
documents required in connection with this Agreement, the
Transaction, and all other related legal matters have been
approved by Glacier's counsel.
5.2.11 RECEIPT OF TITLE POLICY. Glacier has received all title
insurance reports and update endorsements required under
Subsection 4.1.10.
5.2.12 CORPORATE AND STOCKHOLDER ACTION. Mountain West's board of
directors and stockholders, respectively, have approved the
Transaction.
5.2.13 TAX OPINION. Glacier has, at Glacier's expense, obtained from
Xxxxxx & Xxxx, P.C. and delivered to Mountain West, an opinion
addressed to Mountain West and in form and substance reasonably
satisfactory to Mountain West and its counsel, to the effect
that consummation of the Transaction will not result in a
taxable event for Mountain West or Glacier, and otherwise will
have each of the effects specified below:
(a) The Transaction will qualify as a reorganization within
the meaning of IRC Section 368(a)(1)(A).
(b) Under IRC Section 354(a)(i), Mountain West's
stockholders who, in accordance with Section 1, exchange
their Mountain West Common Stock shares solely for
Glacier Common Stock shares will not recognize gain or
loss on the exchange.
(c) Cash payments to Mountain West's stockholders in lieu of
a fractional share of Glacier Common Stock will be
treated as distributions in redemption of the fractional
share interest, subject to the limitations of IRC
Section 302.
5.2.14 OPINION OF COUNSEL. Mountain West has obtained from Xxxxxx &
Xxxxx, X.X., and delivered to Glacier an opinion of counsel,
substantially in the form attached to this Agreement as Exhibit
D.
5.2.15 CASH PAID. The aggregate of the cash paid for fractional shares
and Dissenting Shares to holders of Mountain West Common Stock
under this Agreement and applicable law will not exceed 10% of
the cash value of the Exchange Ratio, as it may be adjusted
under this Agreement.
5.2.16 AFFILIATE LETTERS. Glacier has received the affiliate list and
letters specified in Subsection 4.3.2.
5.2.17 REGISTRATION STATEMENT. The Registration Statement, as it may
have been amended, required in connection with the Glacier
Shares to be issued to stockholders under Subsection 1.6, and as
described in Subsection 4.2, has become effective, and no stop
order suspending the effectiveness of such Registration
Statement has been issued or remains in effect, and no
proceedings for that purpose have been initiated or threatened
by the SEC the basis for which still exists.
5.2.18 CONSENTS. Mountain West has obtained the consents as indicated
in Schedule 6.
5.2.19 FAIRNESS OPINIONS. Glacier has received from Columbia, updated
fairness opinions (to be delivered by Mountain West to Glacier
at Mountain West's expense), dated as of or immediately before
Mountain West mails the Prospectus/Proxy Statement to its
stockholders and immediately before Closing, to the effect that
the financial terms of the Transaction are financially fair to
Mountain West's stockholders. Glacier will provide Mountain
West's investment advisor with any information reasonably
requested for the purpose of issuing a fairness opinion.
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5.2.20 ACCOUNTING TREATMENT. It has been determined to Glacier's
satisfaction that the Transaction will be treated for accounting
purposes as a "pooling of interests" in accordance with APB
Opinion No. 16, and Glacier has received a letter to this effect
from KPMG Peat Marwick LLP, certified public accountants.
5.2.21 SOLICITATION OF EMPLOYEES. Neither any member of Mountain West's
board of directors nor any entity with which any such director
is affiliated has solicited any employee of Mountain West or
Glacier with the intention of causing the employee to terminate
her employment with Mountain West or Glacier, as the case may
be.
5.2.22 DIRECTOR APPOINTMENT. Effective as of Closing, Mountain West has
appointed Xxxxxxx X. Xxxxxxxx to serve on Mountain West's board
of directors.
5.2.23 OTHER MATTERS. Glacier has received any other opinions,
certificates, and documents that Glacier reasonably requests in
connection with this Agreement and the Transaction.
5.3 CONDITIONS TO MOUNTAIN WEST'S OBLIGATIONS. All Mountain West's
obligations under this Agreement are subject to satisfaction of the
following conditions at or before Closing:
5.3.1 REPRESENTATIONS. Glacier's representations and warranties in
this Agreement and in any certificate or other instrument
delivered in connection with this Agreement are true and correct
in all material respects at Closing (except to the extent that
they expressly relate to an earlier date, in which case they are
true in all material respects as of that earlier date). These
representations and warranties have the same force and effect as
if they had been made at Closing. Glacier has delivered to
Mountain West its certificate, executed by a duly authorized
officer of Glacier and dated as of Closing, stating that these
representations and warranties comply with this Subsection
5.3.1.
5.3.2 COMPLIANCE. Glacier has performed and complied in all material
respects with all terms, covenants and conditions of this
Agreement. Glacier has delivered to Mountain West its
certificate, executed by a duly authorized officer of Glacier
and dated as of Closing, stating that Glacier is in compliance
with this Subsection 5.3.2.
5.3.3 NO MATERIAL ADVERSE EFFECT. No damage, destruction, loss or
other event or sequence of events has occurred which,
individually or in the aggregate, has had or potentially may
have a Material Adverse Effect with respect to Glacier.
Glacier's certificate referred to in Subsection 5.3.1 states
that the conditions identified in this Subsection 5.3.3 are
satisfied.
5.3.4 NO GOVERNMENTAL PROCEEDINGS. No action or proceeding has been
commenced or threatened by any governmental agency to restrain,
prohibit or invalidate the Transaction.
5.3.5 CORPORATE AND STOCKHOLDER ACTION. Glacier's board of directors
and Mountain West's stockholders have each approved the
Transaction.
5.3.6 TAX OPINION. The tax opinion specified in Subsection 5.2.13 has
been delivered to Mountain West.
5.3.7 OPINION OF COUNSEL. Glacier has obtained from Xxxxxx & Xxxx,
P.C. and delivered to Mountain West an opinion, addressed to
Mountain West, substantially in the form attached to this
Agreement as Exhibit E.
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5.3.8 FAIRNESS OPINION. Mountain West has received from Columbia an
updated fairness opinion, dated as of or immediately before
Mountain West mails the Prospectus/Proxy Statement to its
stockholders, to the effect that the financial terms of the
Transaction are financially fair to Mountain West's
stockholders.
5.3.9 CASH PAID. The aggregate of the cash paid to holders of Mountain
West Common Stock under this Agreement and applicable law will
not exceed 10% of the cash value of the Exchange Ratio, as it
may be adjusted under this Agreement.
5.3.10 REGISTRATION STATEMENT. The Registration Statement, as it may
have been amended, required in connection with the Glacier
Shares to be issued to stockholders under Subsection 1.6, and as
described in Subsection 4.2, has become effective, and no stop
order suspending the effectiveness of such Registration
Statement has been issued or remains in effect, and no
proceedings for that purpose have been initiated or threatened
by the SEC the basis for which still exists.
5.3.11 DIRECTOR APPOINTMENT. Effective as of Closing, Glacier has
appointed Xxx X. Xxxxxxx to serve on Glacier's board of
directors.
SECTION 6
DIRECTORS, OFFICERS AND EMPLOYEES
6.1 DIRECTORS. As a condition to the execution of this Agreement, each
member of Mountain West's board of directors have entered into the
written agreements described in Recital F with Glacier and Mountain West
on or before the date this Agreement is signed. The director
noncompetition agreements will take effect on the Effective Date.
6.2 EMPLOYMENT AGREEMENT. As a condition to the execution of this Agreement,
Mountain West has entered into an employment agreement, effective as of
the Effective Date, with Xxx X. Xxxxxxx, Mountain West's current
President and Chief Executive Officer. It is also anticipated that
Mountain West will enter into employment agreements with Xxxxxx Xxxx,
Xxxxx Xxxx, Xxxx X. Xxxx and Xxxxx Xxxxx. As part of these employment
agreements, all such individuals will waive all rights they may have
under any previous employment agreements with Mountain West.
6.3 EMPLOYEES. Glacier presently intends to allow Mountain West's employees
who are employed with Mountain West following the Transaction
("Continuing Employees") to participate in certain employee benefit
plans in which employees of Glacier currently participate. Glacier
intends to grant Continuing Employees credit for prior service with
Mountain West for purposes of determining eligibility and vesting.
Benefits for Continuing Employees will begin accruing under Glacier's
plans as soon as practicable after Closing. This expression of intent is
not a contract with Mountain West's employees and will not be construed
to create a contract or employment right with Mountain West's employees.
6.4 INDEMNIFICATION.
6.4.1 Glacier agrees that from and after the Effective Time until 3
years following the Effective Date, Glacier will indemnify and
hold harmless each present and former director and officer of
Mountain West, determined as of the Effective Time (the
"Indemnified Parties"), against any costs or expenses (including
reasonable attorneys' fees), judgments, fines, losses, claims,
damages or liabilities (collectively, "Costs") incurred in
connection with any claim, action, suit, proceeding or
investigation, whether civil, criminal, administrative or
investigative, arising out of or pertaining to matters existing
or occurring at or prior to the Effective Time, whether asserted
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or claimed prior to, at or after the Effective Time, to the
fullest extent that Mountain West would have been permitted
under Idaho law and the articles of incorporation or bylaws of
Mountain West in effect on the date of this Agreement to
indemnify such person (and Glacier will also advance expenses as
incurred to the fullest extent permitted under applicable law;
provided, that the person to whom expenses are advanced provides
an undertaking to repay such advances if it is ultimately
determined that such person is not entitled to indemnification).
6.4.2 To the extent that paragraph (a) will not serve to indemnify and
hold harmless an Indemnified Party, for a period of three years
after the Effective Time, Glacier agrees that it will, subject
to the terms set forth herein, indemnify and hold harmless, to
the fullest extent permitted under applicable law (and Glacier
will also advance expenses as incurred to the fullest extent
permitted under applicable law, provided, that the person to
whom expenses are advanced provides an undertaking to repay such
advances if it is ultimately determined that such person is not
entitled to indemnification), each Indemnified Party against any
Costs incurred in connection with any claim, action, suit,
proceeding or investigation, whether civil, criminal,
administrative or investigative, arising out of or pertaining to
the transactions contemplated by this Agreement. In the event
any claim or claims are asserted or made within such three-year
period, all rights to indemnification in respect of any such
claim or claims will continue until final disposition of any and
all such claims.
6.4.3 Any Indemnified Party wishing to claim indemnification under
Subsection 6.4.1 or 6.4.2, upon learning of any such claim,
action, suit, proceeding or investigation, will promptly notify
Glacier, but the failure to so notify will not relieve Glacier
of any liability it may have to such Indemnified Party if such
failure does not materially prejudice Glacier. In the event of
any such claim, action, suit, proceeding or investigation
(whether arising before or after the Effective Time), Glacier
will have the right to assume the defense thereof and Glacier
will not be liable to such Indemnified Parties for any legal
expenses of other counsel or any other expenses subsequently
incurred by such Indemnified Parties in connection with the
defense thereof, except that, if Glacier elects not to assume
such defense or counsel for the Indemnified Parties advises that
there are issues which raise conflicts of interest between
Glacier and the Indemnified Parties, the Indemnified Parties may
retain counsel satisfactory to them, and Glacier will pay all
reasonable fees and expenses of such counsel for the Indemnified
Parties promptly as statements therefor are received. If such
indemnity is not available with respect to any Indemnified
Party, then Glacier and the Indemnified Party will contribute to
the amount payable in such proportion as is appropriate to
reflect relative faults and benefits.
6.5 EMPLOYEE BENEFIT ISSUES.
6.5.1 COMPARABILITY OF BENEFITS. Glacier confirms to Mountain West its
present intention to provide Continuing Employees with employee
benefit programs which, in the aggregate, are generally
competitive with employee benefit programs offered by financial
institutions of comparable size located in Glacier's and
Mountain West's market area.
6.5.2 TERMINATION AND TRANSFER/MERGER OF PLANS. As soon as practicable
after Closing, all employee benefit plans of Mountain West and
its Subsidiaries will be terminated and the interests of
Continuing Employees in those plans will be transferred or
merged into Glacier's employee benefit plans.
6.5.3 NO CONTRACT CREATED. Nothing in this Agreement gives any
employee of Mountain West or its Subsidiaries a right to
continuing employment.
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SECTION 7
TERMINATION OF AGREEMENT AND
ABANDONMENT OF TRANSACTION
7.1 TERMINATION BY REASON OF LAPSE OF TIME. If Closing does not occur before
the Termination Date, either Glacier or Mountain West may terminate this
Agreement and the Transaction if all of the following conditions are
present:
(a) the terminating party's board of directors decides to terminate
by a majority vote of its members;
(b) the terminating party delivers to the other party written notice
that its board of directors has voted in favor of termination;
and
(c) the failure to consummate the Transaction by the Termination
Date is not due to a breach by the party seeking termination of
any of its obligations, covenants, or representations in this
Agreement.
7.2 OTHER GROUNDS FOR TERMINATION. This Agreement and the Transaction may be
terminated at any time before Closing (whether before or after
applicable approval of this Agreement by Mountain West's stockholders,
unless otherwise provided) as follows:
7.2.1 MUTUAL CONSENT. By mutual consent of Mountain West and Glacier,
if the boards of directors of each party agrees to terminate by
a majority vote of its members.
7.2.2 MOUNTAIN WEST'S CONDITIONS NOT MET. By Glacier's board of
directors if, by March 31, 2000, any condition set forth in
Subsections 5.1 or 5.2 has not been satisfied.
7.2.3 GLACIER'S CONDITIONS NOT MET. By Mountain West's board of
directors if, by March 31, 2000, any condition set forth in
Subsections 5.1 or 5.3 has not been satisfied.
7.2.4 MOUNTAIN WEST FAILS TO RECOMMEND STOCKHOLDER APPROVAL OR OPTION
BECOMES EXERCISABLE. By Glacier's board of directors before
Mountain West's stockholders approve the Transaction, if
Mountain West's board of directors: (a) fails to recommend to
its stockholders the approval of the Transaction or (b)
modifies, withdraws or changes in a manner adverse to Glacier
its recommendation to stockholders to approve the Transaction.
7.2.5 IMPRACTICABILITY. By either Glacier or Mountain West, upon
written notice given to the other party, if the board of
directors of the party seeking termination under this Subsection
7.2.5 has determined in its sole judgment, made in good faith
and after due consideration and consultation with counsel, that
the Transaction has become inadvisable or impracticable by
reason of the institution of litigation by the federal
government or the government of the States of Idaho or Montana
to restrain or invalidate the Transaction or this Agreement.
7.3 MOUNTAIN WEST TERMINATION FEE. Mountain West acknowledges that Glacier
has incurred expenses, direct and indirect, in negotiating and executing
this Agreement and in taking steps to effect Transaction. Accordingly,
Mountain West will pay to Glacier $200,000, if (1) this Agreement
terminates because Mountain West does not use all reasonable efforts to
consummate the Transaction in accordance with the terms of this
Agreement; (2) Mountain West terminates this Agreement for any reason
other than the grounds for termination set forth in Subsections 7.1,
7.2.1, 7.2.3 or 7.2.5; or (3) Glacier terminates this Agreement under
Subsections 7.2.2 (other then for failure of a condition set forth in
Subsections 5.1, 5.2.10, 5.2.13, 5.2.17, 5.2.19 or 5.2.20) or 7.2.4. If
this termination fee becomes payable, it will be
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payable on Glacier's demand and must be paid by Mountain West within 3
business days of the date Glacier makes the demand. Glacier's rights
under the Stock Option Agreement are in addition to this Subsection 7.3,
and this Subsection 7.3 does not limit or restrict these rights or the
circumstances under which Glacier may exercise the Option.
7.4 GLACIER TERMINATION FEE.. Due to expenses, direct and indirect, incurred
by Mountain West in negotiating and executing this Agreement and in
taking steps to effect the Transaction, Glacier will pay to Mountain
West $100,000 if (1) Glacier terminates this Agreement for any reason
other than the grounds for termination set forth in Subsections 7.1,
7.2.1, 7.2.2, 7.2.4 or 7.2.5 or (2) Mountain West terminates this
Agreement under Subsection 7.2.3 (other than for failure of a condition
set forth in 5.1, 5.3.4, 5.3.6, 5.3.8, 5.3.9, 5.3.10, or 5.3.11, unless
the failure of any of those conditions is due to Glacier's fault). If
this termination fee becomes payable, it will be payable on Mountain
West's demand and must be paid by Glacier within 3 business days of the
date Mountain West makes the demand.
7.5 COST ALLOCATION UPON TERMINATION. In connection with the termination of
this Agreement under this Subsection 7.5, except as provided in
Subsections 7.3 and 7.4, Glacier and Mountain West will each pay their
own out-of-pocket costs incurred in connection with this Agreement, and
will have no other liability to the other party.
SECTION 8
MISCELLANEOUS
8.1 NOTICES. Any notice, request, instruction or other document given under
this Agreement must be in writing and must either be delivered
personally or via facsimile transmission or be sent by registered or
certified mail, postage prepaid, and addressed as follows (or to any
other address or person representing any party as designated by that
party through written notice to the other party):
Glacier Glacier Bancorp, Inc.
00 Xxxxxxx Xxxx
Xxxxxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxxxx
Xxxxxxx X. Xxxxx, Esq.
Xxxxxx & Xxxx, P.C.
with a copy to: 0000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxxxxxx, XX 00000-0000
Mountain West Mountain West Bank
P.O. Box 1059
000 Xxxxxxxx Xxxxx
Xxxxx x'Xxxxx, XX 00000
Attn: Xxx X. Xxxxxxx
with a copy to: Xxxxx Xxxxxx, Esq.
Xxxxxx & Xxxxx, X.X.
000 XX Xxxx., Xxxxx 000
Xxxxx x'Xxxxx, XX 00000
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8.2 WAIVERS AND EXTENSIONS. Subject to Section 9, Glacier or Mountain West
may grant waivers or extensions to the other party, but only through a
written instrument executed by the Chief Executive Officer or President
of the party granting the waiver or extension. Waivers or extensions
which do not comply with the preceding sentence are not effective. In
accordance with this Section 8, a party may extend the time for the
performance of any of the obligations or other acts of any other party,
and may waive:
(a) any inaccuracies of any other party in the representations and
warranties contained in this Agreement or in any document
delivered in connection with this Agreement;
(b) compliance with any of the covenants of any other party; and
(c) any other party's performance of any obligations under this
Agreement and any other condition precedent set out in Section
5.
8.3 GENERAL INTERPRETATION. Except as otherwise expressly provided in this
Agreement or unless the context clearly requires otherwise: (1) the
defined terms defined in this Agreement include the plural as well as
the singular and (2) references in this Agreement to Sections,
Subsections, Schedules, and Exhibits refer to Sections and Subsections
of and Schedules and Exhibits to this Agreement. Whenever the words
"include", "includes", or "including" are used in this Agreement, the
parties intend them to be interpreted as if they are followed by the
words "without limitation." All accounting terms used in this Agreement
that are not expressly defined in this Agreement have the respective
meanings given to them in accordance with GAAP.
8.4 CONSTRUCTION AND EXECUTION IN COUNTERPARTS. Except as otherwise
expressly provided in this Agreement, this Agreement: (1) contains the
parties' entire understanding, and no modification or amendment of its
terms or conditions will be effective unless in writing and signed by
the parties, or their respective duly authorized agents; (2) will not be
interpreted by reference to any of the titles or headings to the
Sections or Subsections, which have been inserted for convenience only
and are not deemed a substantive part of this Agreement; (3) includes
all amendments to this Agreement, each of which is made a part of this
Agreement by this reference; and (4) may be executed in one or more
counterparts, each of which will be deemed an original, but all of which
taken together will constitute one and the same document.
8.5 SURVIVAL OF REPRESENTATIONS AND COVENANTS. The representations and
covenants in this Agreement will not survive Closing or termination of
this Agreement, except that (1) Subsection 4.9 (confidentiality),
Subsections 7.3 and 7.4 (termination fee), and Subsection 7.5 (expense
allocation) will survive termination and Closing, and (2) the covenants
in this Agreement that impose duties or obligations on the parties
following Closing will survive Closing.
8.6 ATTORNEYS' FEES AND COSTS. In the event of any dispute or litigation
with respect to the terms and conditions or enforcement of rights or
obligations arising by reason of this Agreement or the Transaction, the
prevailing party in any such litigation will be entitled to
reimbursement from the other party for its costs and expenses, including
reasonable judicial and extra-judicial attorneys' fees, expenses and
disbursements, and fees, costs and expenses relating to any mediation or
appeal.
8.7 ARBITRATION. At either party's request, the parties must submit any
dispute, controversy or claim arising out of or in connection with, or
relating to, this Agreement or any breach or alleged breach of this
Agreement, to arbitration under the American Arbitration Association's
rules then in effect (or under any other form of arbitration mutually
acceptable to the parties). A single arbitrator agreed on by the parties
will conduct the arbitration. If the parties cannot agree on a single
arbitrator, each party must select one
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arbitrator and those two arbitrators will select a third arbitrator.
This third arbitrator will hear the dispute. The arbitrator's decision
is final (except as otherwise specifically provided by law) and binds
the parties, and either party may request any court having jurisdiction
to enter a judgment and to enforce the arbitrator's decision. The
arbitrator will provide the parties with a written decision naming the
substantially prevailing party in the action. This prevailing party is
entitled to reimbursement from the other party for its costs and
expenses, including reasonable attorneys' fees.
8.8 GOVERNING LAW AND VENUE. This Agreement will be governed by and
construed in accordance with Montana law, except to the extent that
certain matters may be governed by federal law. The parties must bring
any legal proceeding arising out of this Agreement in Flathead County,
Montana or in the U.S. District Court for the District of Montana.
8.9 SEVERABILITY. If a court determines that any term of this Agreement is
invalid or unenforceable under applicable law, the remainder of this
Agreement is not affected, and each remaining term is valid and
enforceable to the fullest extent permitted by law.
SECTION 9
AMENDMENTS
At any time before the Effective Date, whether before or after the
parties have obtained any applicable stockholder approvals of the Transaction,
the boards of directors of Glacier and Mountain West may: (1) amend or modify
this Agreement or any attached Exhibit or Schedule and (2) grant waivers or time
extensions in accordance with this Section 9. But, after Mountain West's
stockholders have approved this Agreement, the parties' boards of directors may
not without Mountain West stockholder approval amend or waive any provision of
this Agreement if the amendment or waiver would reduce the amount or change the
form of consideration Mountain West stockholders will receive in the
Transaction. All amendments, modifications, extensions and waivers must be in
writing and signed by the party agreeing to the amendment, modification,
extension or waiver. Failure by any party to insist on strict compliance by the
other party with any of its obligations, agreements or conditions under this
Agreement, does not, without a writing, operate as a waiver or estoppel with
respect to that or any other obligation, agreement, or condition.
[SIGNATURES APPEAR ON THE FOLLOWING PAGE]
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Signed as of September 9, 1999:
GLACIER BANCORP, INC.
By /s/ Xxxxxxx X. Xxxxxxxx
---------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: President and CEO
MOUNTAIN WEST BANK
By /s/ Xxx X. Xxxxxxx
---------------------------------
Name: Xxx X. Xxxxxxx
Title: President and CEO
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STATE OF MONTANA )
) ss.
COUNTY OF FLATHEAD )
On this 9th day of September, 1999, before me personally appeared
Xxxxxxx X. Xxxxxxxx, to me known to be the President and Chief Executive Officer
of GLACIER BANCORP, INC., the corporation that executed the foregoing
instrument, who acknowledged said instrument to be the free and voluntary act
and deed of said corporation, for the uses and purposes mentioned there, and who
stated on oath that he was authorized to execute said instrument, and that the
seal affixed (if any) was the official seal of said corporation.
IN WITNESS OF THE FOREGOING, I have set my hand and official seal to
this document as of the day and year first written above.
/s/ Xxx Xxx Xxxxxxxxx
------------------------------------
NOTARY PUBLIC in and for the State
of Montana
residing at Kalispell.
Title: Executive Secretary.
My commission expires:7-21-03.
STATE OF WASHINGTON )
) ss.
COUNTY OF SPOKANE )
On this 8th day of September, 1999, before me personally appeared Xxx X.
Xxxxxxx, to me known to be the President and Chief Executive Officer of MOUNTAIN
WEST BANK, the corporation that executed the foregoing instrument, who
acknowledged said instrument to be the free and voluntary act and deed of said
corporation, for the uses and purposes mentioned there, and who stated on oath
that he was authorized to execute said instrument, and that the seal affixed (if
any) was the official seal of said corporation.
IN WITNESS OF THE FOREGOING, I have set my hand and official seal to
this document as of the day and year first written above.
/s/ Xxxx X. Xxxxxxxx
------------------------------------
NOTARY PUBLIC in and for the State
of Washington residing at Spokane.
Title: .
------------------------------
My commission expires: 12/15/00.
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