EXHIBIT 2
FIRST CARNEGIE DEPOSIT
AGREEMENT AND PLAN OF REORGANIZATION
THIS AGREEMENT AND PLAN OF REORGANIZATION, dated as of May 14, 1998, by
and among FIRST CARNEGIE DEPOSIT, a federally chartered stock savings bank (the
"Bank"); XXXXX FINANCIAL CORP., a to-be-formed federal corporation (the "Holding
Company"); and XXXXX INTERIM SAVINGS BANK, a to-be-formed interim stock savings
institution ("Interim").
The parties hereto desire to enter into an Agreement and Plan of
Reorganization whereby the corporate structure of the Bank will be reorganized
into the stock holding company form of ownership (the "Reorganization"). The
result of the Reorganization will be that, immediately after the Effective Date
(as defined herein), all of the issued and outstanding shares of Common Stock of
the Bank will be held by the Holding Company and the holders of the issued and
outstanding shares of Common Stock of the Bank (i.e., the mutual holding
company, Xxxxx Bancshares, M.H.C., and the minority public stockholders) will
become the holders of the issued and outstanding shares of Common Stock of the
Holding Company.
The Reorganization of the Bank will be accomplished by the following
steps: (1) the formation by the Bank of a wholly-owned subsidiary of the Bank,
Xxxxx Financial Corp., incorporated under the laws of the United States for the
primary purpose of becoming the sole stockholder of a newly-formed interim stock
savings institution, and subsequently becoming the sole stockholder of the
Common Stock of the Bank, which formation will include the issuance of up to
100,000 shares of the Holding Company Common Stock to the Bank for a price of
$10.00 per share ($1,000,000) for the purpose of initially capitalizing the
Holding Company; (2) the formation of an interim federally chartered savings
institution, "Interim," which will be wholly-owned by the Holding Company; and
(3) the merger of Interim into the Bank (the "Merger"), with the Bank as the
surviving entity. Pursuant to such Merger: (i) all of the issued and outstanding
shares of Common Stock of the Holding Company held by the Bank will be canceled;
(ii) all of the issued and outstanding shares of Common Stock of the Bank will
automatically be converted by operation of law on a three-for-two basis into
issued and outstanding shares of Common Stock of the Holding Company; (iii) all
of the issued and outstanding shares of Common Stock of Interim will
automatically be converted by operation of law into an equal number of issued
and outstanding shares of Common Stock of the Bank, which will be all of the
issued and outstanding stock of the Bank.
NOW, THEREFORE, in order to consummate this Agreement and Plan of
Reorganization (the "Agreement"), and in consideration of the mutual covenants
herein set forth, the parties agree as follows:
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ARTICLE I
MERGER OF INTERIM INTO THE BANK
AND RELATED MATTERS
1.1 On the Effective Date, Interim will be merged with and into
the Bank and the separate existence of Interim shall cease,
and all assets and property (real, personal and mixed,
tangible and intangible, chooses in action, rights and
credits) then owned by Interim, or which would inure to it,
shall immediately and automatically, by operation of law and
without any conveyance, transfer, or further action, become
the property of the Bank. The Bank shall be deemed to be a
continuation of Interim, and the Bank shall succeed to the
rights and obligations of Interim.
1.2 Following the Merger, the existence of the Bank shall continue
unaffected and unimpaired by the Merger, with all the rights,
privileges, immunities and powers, and subject to all of the
duties and liabilities, of a corporation organized under the
laws of the United States. The Charter and Bylaws of the Bank,
as presently in effect, shall continue in full force and
effect and shall not be changed in any manner whatsoever by
the Merger.
1.3 From and after the Effective Date, and subject to the actions
of the Board of Directors of the Bank, the business presently
conducted by the Bank (whether directly or through its
subsidiaries) will continue to be conducted by it, as a
wholly-owned subsidiary of the Holding Company, and the
present directors and officers of the Bank will continue in
their present positions. The home office and branch offices of
the Bank in existence immediately prior to the Effective Date
shall continue to be the home office and branch offices of the
Bank from and after the Effective Date.
1.4 The Reorganization will have no effect on the corporate
structure of the Mutual Holding Company, Xxxxx Bancshares,
M.H.C., which will continue to operate under its current
charter and bylaws, and the present directors and officers of
the Mutual Holding Company will continue in their present
positions.
ARTICLE II
CONVERSION OF STOCK
2.1 The terms and conditions of the Merger, the mode of carrying
the same into effect, and the manner and basis of converting
the Common Stock of the parties to this Agreement shall be as
follows:
A. On the Effective Date, all shares of Common Stock of
the Holding Company held by the Bank shall be
canceled and shall no longer be deemed to be issued
or outstanding for any purpose.
B. On the Effective Date, shares of Common Stock, $.10
par value, of the Bank ("Bank Common Stock") issued
and outstanding immediately prior to the Effective
Date shall automatically by operation of law be
converted into and shall become shares of Common
Stock, $.10 par value, of the Holding Company
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("Holding Company Common Stock") on a three-for two
basis, with the rights, privileges, preferences and
voting power incident to each share of Bank Common
Stock prior to such Effective Date. Each person who,
but for the provisions of this Section 2.1B., would
be entitled to a fractional share interest in the
Holding Company Common Stock as a result of the
Reorganization, upon surrender of certificates
theretofore representing shares of Holding Company
Common Stock, shall receive in lieu thereof an amount
in cash equal to such fraction multiplied by the
average of the bid and ask price of the Bank Common
Stock on the last full trading day of the Bank Common
Stock prior to the Effective Date. Each share of
Common Stock of Interim issued and outstanding
immediately prior to the Effective Date shall, on the
Effective Date, automatically by operation of law be
converted into and become one share of Common Stock,
$.10 par value, of the Bank and shall not be further
converted into shares of the Holding Company Common
Stock, so that from and after the Effective Date, all
of the issued and outstanding shares of Common Stock
of the Bank shall be held by the Holding Company.
C. As soon as practicable after the Effective Date, the
certificates representing the outstanding Bank Common
Stock shall be surrendered to the Bank or the
designated agent of the Bank ("Exchange Agent") and,
upon such surrender, the Exchange Agent shall issue
and deliver in substitution therefore, cash and
certificates representing the number of shares of
Holding Company Common Stock into which such
surrendered shares have been converted as herein-
before provided, and cash in lieu of fractional
shares (without interest). Certificates representing
Bank Common Stock which are not surrendered shall be
deemed for all purposes to evidence the ownership of
the number of shares of Holding Company Common Stock
into which said shares of the Bank shall have been
converted as hereinbefore set forth and the right to
receive cash in the amount determined pursuant to
Section 2.1B.; provided, however, that Holding
Company will not distribute to the holder of an
unsurrendered certificate for Bank Common Stock
dividends declared with respect to Holding Company
Common Stock until such owner shall surrender such
certificate, at which time the holder thereof shall
be paid the amount of the dividends having a record
date on or after the Effective Date theretofore
declared with respect to Holding Company Common Stock
without interest. All such dividends unclaimed at
the end of one year from the Effective Date shall be
repaid by the Exchange Agent to Holding Company, and
thereafter the holders of such outstanding
certificates shall look, subject to applicable
escheat, unclaimed funds and other laws, as general
creditors only to Holding Company for payment
thereof.
D. All shares of Holding Company Common Stock into which
shares of Bank Common Stock shall have been converted
pursuant to this Article shall be deemed to have been
issued in full satisfaction of all rights pertaining
to such converted shares.
E. On the Effective Date, the holders of certificates
formerly representing Bank Common Stock outstanding
on the Effective Date shall cease to have any rights
with respect to Bank Common Stock, and their sole
rights shall be with respect
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to the Holding Company Common Stock into which their
shares of Bank Common Stock shall have been converted
by the Merger.
ARTICLE III
CONDITIONS
3.1 The obligations of the Bank, the Holding Company and Interim
to effect the Merger and otherwise consummate the transactions
which are the subject matter hereof shall be subject to
satisfaction of the following conditions:
A. To the extent required by applicable law, rules, and
regulations, the holders of the outstanding shares of
Bank Common Stock shall, at a meeting of the
stockholders of the Bank duly called, have approved
this Agreement by the affirmative vote of two-thirds
of the outstanding shares of Bank Common Stock.
B. The shares of Holding Company Common Stock to be
issued to the Bank stockholders pursuant to the
Merger shall have been, if required by law, duly
registered pursuant to the Securities Act of 1933, as
amended, and the Bank shall have complied with all
applicable state securities or "blue sky" laws
relating to the issuance of the Holding Company
Common Stock.
C. Any and all approvals from the Office of Thrift
Supervision (the "OTS"), the Federal Deposit
Insurance Corporation, the Securities and Exchange
Commission and any other governmental agency having
jurisdiction necessary for the lawful consummation of
the Merger and the issuance and delivery of the
Holding Company Common Stock as contemplated by this
Agreement shall have been
obtained.
D. The Bank shall have received either (i) a ruling from
the Internal Revenue Service or (ii) an opinion from
its legal counsel, to the effect that the
Reorganization will be treated as a non-taxable
transaction under applicable provisions of the
Internal Revenue Code and that no gain or loss will
be recognized by the stockholders of the Bank upon
the exchange of Bank Stock held by them for Holding
Company Stock.
ARTICLE IV
EFFECTIVE DATE OF MERGER
Upon satisfaction or waiver (in accordance with the provisions of this
Agreement) of each of the conditions set forth herein, the parties hereto shall
execute and cause to be filed Articles of Combination, and/or such certificates
or further documents as shall be required by the OTS, the Office of the
Secretary of the OTS, and with such other federal or state regulatory agencies
as may be required. Upon approval by the OTS, and endorsement of such
certificates, the Merger and other transactions contemplated by this Agreement
shall become effective. The Effective Date for all purposes hereunder shall be
the date of such endorsement.
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ARTICLE V
AMENDMENT AND TERMINATION
5.1 The Bank, the Holding Company and Interim, by mutual consent
of their respective Boards of Directors or Incorporators, as
the case may be, to the extent permitted by law, may amend,
modify, supplement and interpret this Agreement in such manner
as may be mutually agreed upon by them at any time before or
after the approval and adoption thereof by the stockholders of
the Bank; provided, however, that no such amendment,
modification, supplement or interpretation shall have a
materially adverse impact on the Bank or its stockholders
except with the approval of the stockholders of the Bank.
5.2 This Agreement may be terminated at the election of any of the
parties hereto if any one or more of the conditions to the
obligations of any of them hereunder shall have been satisfied
and become incapable of fulfillment and shall have not been
waived. This Agreement may also be terminated at any time
prior to the Effective Date by the mutual consent of the
respective Boards of Directors of the parties.
5.3 In the event of the termination of this Agreement pursuant to
any of the foregoing provisions, no party shall have any
further liability or obligation of any nature to any other
party under this Agreement.
ARTICLE VI
MISCELLANEOUS
6.1 Any of the terms or conditions of this Agreement (other than
the necessary approvals of stockholders and government
authorities) may be waived at any time by any party hereto
which is entitled to the benefit thereof, by action taken by
its Board of Directors; provided, however, that such action
shall be taken only if, in the judgment of the Board of
Directors taking the action, such waiver will not have a
materially adverse effect on the benefits intended under this
Agreement to be afforded to the stockholders of the Bank.
6.2 This Agreement embodies the entire agreement among the parties
and there have been and are no agreements, representations or
warranties among the parties other than those set forth or
provided for herein.
6.3 Any number of counterparts hereof may be executed and each
such counterpart shall be deemed to be an original instrument,
but all such counterparts together shall constitute but one
instrument.
6.4 Any notice or waiver to be given to any party shall be in
writing and shall be deemed to have been duly given if
delivered, mailed, or sent by prepaid telegram, addressed to
such party at 000 Xxxx Xxxx Xxxxxx, Xxxxxxxx, Xxxxxxxxxxxx
00000.
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6.5 The captions contained in this Agreement are solely for
convenient reference and shall not be deemed to affect the
meaning or interpretation of any paragraph hereof.
6.6 The Bank will pay all fees and expenses incurred in connection
with the transactions contemplated by this Agreement. After
the Reorganization, the Holding Company will incur certain
expenses that arise from its creation for the purpose of
serving as, and continued existence as, the holding company of
the Bank, such as the costs associated with the filing of
reports with the OTS, holding of directors and stockholders
meetings and maintaining relations with and providing reports
to stockholders. The Bank agrees that it will reimburse the
Holding Company for such ordinary and usual expenses when and
as payable by the Holding Company.
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IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement and Plan of Reorganization as of the date first above written.
FIRST CARNEGIE DEPOSIT
BY: /s/ Xxxxxx X. Xxxxx
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Xxxxxx X. Xxxxx, President
ATTEST: /s/ Xxxxxxxxx X. Xxxxxxx
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Xxxxxxxxx X. Xxxxxxx, Corporate Secretary
XXXXX FINANCIAL CORP. (In Formation)
BY: /s/ Xxxxxx X. Xxxxx
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Xxxxxx X. Xxxxx, President
ATTEST: /s/ Xxxxxxxxx X. Xxxxxxx
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Xxxxxxxxx X. Xxxxxxx, Corporate Secretary
XXXXX INTERIM SAVINGS BANK (In formation)
BY: /s/ Xxxxxx X. Xxxxx
-----------------------------------------
Xxxxxx X. Xxxxx, President
ATTEST: /s/ Xxxxxxxxx X. Xxxxxxx
-----------------------------------------
Xxxxxxxxx X. Xxxxxxx, Corporate Secretary
