PLAN OF REORGANIZATION AND AGREEMENT AND PLAN OF MERGER
This Plan of Reorganization and Agreement of Merger
(hereinafter called the "Merger Agreement") is made as of
January 11, 1999, by and between NewSouth Bancorp, Inc., a
Delaware corporation ("NewSouth Delaware") and NewSouth Bancorp,
Inc., a Virginia corporation ("NewSouth Virginia"). NewSouth
Delaware and/or NewSouth Virginia, when reference is made to the
entity irrespective of the state of incorporation, is sometimes
herein referred to as the "Company."
WITNESSETH:
WHEREAS, NewSouth Delaware is a corporation duly organized
and existing under the laws of the State of Delaware;
WHEREAS, NewSouth Virginia is a corporation duly organized
and existing under the laws of the Commonwealth of Virginia;
WHEREAS, as of the date of this Merger Agreement, NewSouth
Delaware has authority to issue 8,000,000 shares of common
stock, par value $.01 per share, of which 4,040,844 shares are
issued and outstanding; and 1,000,000 shares of preferred stock,
par value $.01 per share, none of which are issued or outstand-
ing;
WHEREAS, as of the date of this Merger Agreement, NewSouth
Virginia has authority to issue 8,000,000 shares of common
stock, par value $.01 per share, of which 100 shares are issued
and outstanding and owned by NewSouth Delaware; and 1,000,000
shares of preferred stock, par value $.01 per share, none of
which are issued or outstanding;
WHEREAS, the respective Boards of Directors of NewSouth
Delaware and NewSouth Virginia have determined that, for the
purpose of effecting the reincorporation of NewSouth Delaware in
the Commonwealth of Virginia, it is advisable and to their
advantage and the advantage of their respective stockholders
that NewSouth Delaware merge with and into NewSouth Virginia
upon the terms and conditions herein provided; and
WHEREAS, the respective Boards of Directors of NewSouth
Delaware and NewSouth Virginia have approved this Merger
Agreement and have directed that this Merger Agreement be
submitted to the vote of their respective stockholders.
AGREEMENT
NOW, THEREFORE, the parties do hereby adopt the plan of
reorganization encompassed by this Merger Agreement and do
hereby agree that NewSouth Delaware shall merge with and into
NewSouth Virginia on the following terms, conditions and other
provisions:
I. TERMS AND CONDITIONS
1.1 Merger. Subject to approval of the respective
stockholders of NewSouth Delaware and NewSouth Vifginia and the
receipt of all required regulatory approvals, NewSouth Delaware
shall be merged with and into NewSouth Virginia (the "Merger"),
and NewSouth Virginia shall be the surviving corporation,
effective upon the date when this Merger Agreement is made
effective in accordance with applicable law (the "Effective
Date").
1.2 Succession. Upon the Effective Date, NewSouth Virginia
shall succeed to all of the rights, privileges, powers and
property of NewSouth Delaware in the manner of and as more fully
set forth in Section 13.1-721 of the Virginia Stock Corporation
Act.
1.3 Common Stock of NewSouth Delaware. Upon the Effective
Date, by virtue of the Merger and without any action on the part
of the holder thereof, each share of common stock, par value
$.01 per share, of NewSouth Delaware outstanding immediately
prior thereto shall be changed and converted into one fully paid
and non-assessable share of the common stock of NewSouth
Virginia, par value $.01 per share.
1.4 Common Stock of NewSouth Virginia. Upon the Effective
Date, by virtue of the Merger and without any action on the part
of the holder thereof, the 100 shares of common stock, par value
$.01 per share, of NewSouth Virginia outstanding immediately
prior thereto shall be canceled and returned to the status of
authorized but unissued shares.
1.5 Stock Certificates. Upon and after the Effective Date,
all of the outstanding certificates which prior to that time
represented shares of common stock, par value $.01 per share, of
NewSouth Delaware shall be deemed for all purposes to evidence
ownership of and to represent the shares of common stock, par
value $.01 per share, of NewSouth Virginia into which the shares
of NewSouth Delaware represented by such certificates have been
converted as herein provided. The registered owner on the books
and records of NewSouth Virginia or its transfer agent of any
such outstanding stock certificate shall, until such certificate
shall have been surrendered for transfer or conversion or
otherwise accounted for to NewSouth Virginia or its transfer
agent, have and be entitled to exercise any voting and other
rights with respect to, and to receive any dividend and other
distributions upon, the shares of NewSouth Virginia evidenced by
such outstanding certificate as above provided.
1.6 Options. Upon the Effective Date, NewSouth Virginia
will assume and continue NewSouth Delaware's 1997 Stock Option
Plan, and the outstanding and unexercised portions of all
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options and rights to buy common stock, par value $.01 per
share, of NewSouth Delaware shall become options or rights for
the same number of shares of common stock, par value $.01 per
share, of NewSouth Virginia, with no other changes in the terms
and conditions of such options or rights, including exercise
prices, and effective upon the Effective Date, NewSouth Virginia
hereby assumes the outstanding and unexercised portions of such
options and rights and the obligations of NewSouth Delaware with
respect thereto.
1.7 Restricted Stock Awards. Upon the Effective Date,
NewSouth Virginia will assume and continue NewSouth Delaware's
Management Recognition Plan, and awarded but unvested shares of
restricted common stock, par value $.01 per share, of NewSouth
Delaware shall become the same number of shares of awarded but
unvested restricted common stock, par value $.01 per share, of
NewSouth Virginia, with no other changes in the terms and
conditions of such restricted stock awards, including vesting
schedules and rights to receive dividend payments, and effective
upon the Effective Date, NewSouth Virginia hereby assumes the
obligations of NewSouth Delaware with respect to the Management
Recognition Plan and awards made by NewSouth Delaware there-
under.
1.8 Other Employee Benefit Plans. Upon the Effective Date,
NewSouth Virginia will assume all obligations of NewSouth
Delaware under any and all employee benefit plans in effect as
of the Effective Date or with respect to which employee rights
or accrued benefits are outstanding as of the Effective Date.
II. CHARTER DOCUMENTS, DIRECTORS AND OFFICERS
2.1 Articles of Incorporation and Bylaws. The Articles of
Incorporation of NewSouth Virginia in effect on the Effective
Date (a copy of which is attached hereto and incorporated herein
by this reference), shall continue to be the Articles of
Incorporation of NewSouth Virginia. The Bylaws of NewSouth
Virginia in effect on the Effective Date shall continue to be
the Bylaws of NewSouth Virginia.
2.2 Directors. The directors of NewSouth Virginia
immediately preceding the Effective Date shall remain the
directors of NewSouth Virginia on and after the Effective Date.
Such directors of NewSouth Virginia shall hold office in the
classes and for the terms as in effect immediately prior to the
Effective Date, and until their successors are elected and
qualified or their prior resignation, removal or death.
2.3 Officers. The officers of NewSouth Virginia shall
remain the officers of NewSouth Virginia upon the Effective Date
and shall serve until their successors are elected and qualified
or their prior resignation, removal or death.
III. MISCELLANEOUS
3.1 Further Assurances. From time to time, as and when
required by NewSouth Virginia or by its successors and assigns,
there shall be executed and delivered on behalf of NewSouth
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Delaware such deeds and other instruments, and there shall be
taken or caused to be taken by it such further and other action
as shall be appropriate or necessary in order to vest or
perfect, or to conform of record or otherwise, in NewSouth
Virginia the title to and possession of all the property,
interests, assets, rights, privileges, immunities, powers,
franchises, and authority of NewSouth Delaware, and otherwise to
carry out the purposes of this Merger Agreement, and the
officers and directors of NewSouth Virginia are fully authorized
in the name of and on behalf of NewSouth Delaware or otherwise
to take any and all such action and to execute and deliver any
and all such deeds and other instruments.
3.2 Amendment. At any time before or after approval by the
stockholders of NewSouth Delaware, this Merger Agreement may be
amended in any manner (except that Section 1.3, 1.4 and 2.1 and
any of the other principal terms hereof as set forth in Section
251(d) of the Delaware General Corporation Law may not be
amended without the approval of the stockholders of NewSouth
Delaware) as may be determined in the judgment of the respective
Boards of Directors of NewSouth Delaware and NewSouth Virginia
to be necessary, desirable or expedient in order to clarify the
intention of the parties hereto or to effect or facilitate the
purposes and intent of this Merger Agreement; provided, however,
that the Merger Agreement may not be amended after stockholder
approval if such amendment would (i) alter or change the amount
or kind of shares or other consideration to be received by
stockholders in the Merger; (ii) alter or change any term of the
Articles of Incorporation of NewSouth Virginia; (iii) alter or
change any of the terms and conditions of the Merger Agreement
if such alteration or change would adversely affect the
stockholders; or (iv) otherwise violate applicable law.
3.3 Abandonment. At any time before the Effective Date,
this Merger Agreement may be terminated and the Merger may be
abandoned by the Board of Directors of either NewSouth Delaware
or NewSouth Virginia or both, notwithstanding the approval of
this Merger Agreement by the stockholders of NewSouth Delaware.
3.4 Counterparts. In order to facilitate the filing and
recording of this Merger Agreement, the same may be executed in
any number of counterparts, each of which shall be deemed to be
an original.
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IN WITNESS WHEREOF, this Merger Agreement, having first
been duly approved by the Boards of Directors of NewSouth
Delaware and NewSouth Virginia, is hereby executed on behalf of
each said corporation and attested by their respective officers
thereunto duly authorized.
NEWSOUTH BANCORP, INC.,
a Delaware corporation
Corporate Seal By:/s/ Xxxxxx X. Xxxx
-----------------------
Xxxxxx X. Xxxx
Attest:
/s/ Xxxxxxx X. Xxxx
---------------------------
Xxxxxxx X. Xxxx
Secretary
NEWSOUTH BANCORP, INC.,
a Virginia corporation
Corporate Seal By:/s/ Xxxxxx X. Xxxx
-----------------------
Xxxxxx X. Xxxx
Attest:
/s/ Xxxxxxx X. Xxxx
--------------------------
Xxxxxxx X. Xxxx
Secretary
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