AGREEMENT AND PLAN OF MERGER BETWEEN ASSOCIATED BANC-CORP AND FIRST FEDERAL CAPITAL CORP April 27, 2004
AGREEMENT AND PLAN OF MERGER
BETWEEN
AND
FIRST FEDERAL CAPITAL CORP
April 27, 2004
TABLE OF CONTENTS ARTICLE I THE MERGER SECTION 1.01. The Merger.................................................................. SECTION 1.02. Effective Time.............................................................. SECTION 1.03. Effect of the Merger........................................................ SECTION 1.04. Articles of Incorporation and Bylaws........................................ SECTION 1.05. Directors and Officers...................................................... SECTION 1.06. Conversion of Securities.................................................... SECTION 1.07. Exchange of Certificates.................................................... SECTION 1.08. Stock Transfer Books........................................................ SECTION 1.09. Anti-Dilution Adjustment.................................................... SECTION 1.10. Treatment of Company Stock Options.......................................... ARTICLE II REPRESENTATIONS AND WARRANTIES OF THE COMPANY SECTION 2.01. Organization and Qualification of the Company, Bank, and the Company Subsidiaries.............................................. SECTION 2.02. Articles of Incorporation and Bylaws........................................ SECTION 2.03. Capitalization.............................................................. SECTION 2.04. Authority................................................................... SECTION 2.05. No Conflict; Required Filings and Consents.................................. SECTION 2.06. Compliance; Permits......................................................... SECTION 2.07. Banking Reports, SEC Reports, and Financial Statements...................... SECTION 2.08. Absence of Certain Changes or Events........................................ SECTION 2.09. Absence of Litigation....................................................... SECTION 2.10. Employee Benefit Plans...................................................... SECTION 2.11. Employment Contracts; Material Contracts.................................... SECTION 2.12. Registration Statement; Proxy Statement..................................... SECTION 2.13. Title to Property........................................................... SECTION 2.14. Compliance with Environmental Laws.......................................... SECTION 2.15. Absence of Agreements....................................................... SECTION 2.16. Taxes....................................................................... SECTION 2.17. Insurance................................................................... SECTION 2.18. Absence of Adverse Agreements............................................... SECTION 2.19. Internal Control Over Financial Reporting................................... SECTION 2.20. Loans....................................................................... SECTION 2.21. Related Party Transactions ................................................. SECTION 2.22. Labor Matters............................................................... SECTION 2.23. NASDAQ; Compliance with SOX................................................. SECTION 2.24. Brokers..................................................................... SECTION 2.25. Tax Matters................................................................. SECTION 2.26. Full Disclosure............................................................. SECTION 2.27 Vote Required............................................................... SECTION 2.28. Board Approval.............................................................. ARTICLE III REPRESENTATIONS AND WARRANTIES OF ASSOCIATED SECTION 3.01. Organization and Qualification.............................................. SECTION 3.02. Articles of Incorporation and Bylaws........................................ SECTION 3.03. Capitalization of Associated................................................ SECTION 3.04. Authority................................................................... SECTION 3.05. No Conflict; Required Filings and Consents.................................. SECTION 3.06. Compliance; Permits......................................................... SECTION 3.07. SEC Reports, and Financial Statements................................................................ SECTION 3.08. Absence of Certain Changes or Events........................................ SECTION 3.09. Absence of Litigation....................................................... SECTION 3.10. Registration Statement; Proxy Statement..................................... SECTION 3.11. Absence of Agreements....................................................... SECTION 3.12. Taxes....................................................................... SECTION 3.13. Compliance with SOX......................................................... SECTION 3.14. Brokers..................................................................... SECTION 3.15. Tax Matters................................................................. SECTION 3.16. Full Disclosure............................................................. SECTION 3.17. Absence of Adverse Agreements............................................... SECTION 3.18. Employee Benefit Plans...................................................... SECTION 3.19. Compliance With Environmental Laws.......................................... ARTICLE IV COVENANTS OF THE COMPANY SECTION 4.01. Affirmative Covenants....................................................... SECTION 4.02. Negative Covenants.......................................................... SECTION 4.03. Access and Information...................................................... SECTION 4.04. Affiliates and Tax Treatment................................................ SECTION 4.05. Expenses.................................................................... SECTION 4.06. Delivery of Shareholder List................................................ SECTION 4.07. Employee Benefits........................................................... ARTICLE V COVENANTS OF ASSOCIATED SECTION 5.01. Covenants................................................................... SECTION 5.02. Access and Information...................................................... SECTION 5.03. Tax Treatment............................................................... SECTION 5.04. Charitable Contributions ................................................... SECTION 5.05. SEC Filings................................................................. SECTION 5.06. Stock Exchange Listing...................................................... SECTION 5.07. Nomination of Director...................................................... ARTICLE VI ADDITIONAL AGREEMENTS SECTION 6.01. Registration Statement......................................................... SECTION 6.02. Meeting of Shareholders........................................................ SECTION 6.03. Appropriate Action; Consents; Filings.......................................... SECTION 6.04. Notification of Certain Matters................................................ SECTION 6.05. Public Announcements........................................................... SECTION 6.06. Environmental Matters.......................................................... SECTION 6.07. Employee Benefits.............................................................. SECTION 6.08. Associated Advisory Boards..................................................... SECTION 6.09. Certain Benefits of Company Directors.......................................... SECTION 6.10. Severance Benefits for Company Employees....................................... SECTION 6.11. Directors' and Officers' Indemnification and Insurance......................... SECTION 6.12. 2004 Accrued Bonuses........................................................... SECTION 6.13. Stay Bonuses................................................................... ARTICLE VII CONDITIONS OF MERGER SECTION 7.01. Conditions to Obligation of Each Party to Effect the Merger.................... SECTION 7.02. Additional Conditions to Obligations of Associated............................. SECTION 7.03. Additional Conditions to Obligations of the Company............................ ARTICLE VIII TERMINATION, AMENDMENT AND WAIVER SECTION 8.01. Termination.................................................................... SECTION 8.02. Effect of Termination.......................................................... SECTION 8.03. Amendment...................................................................... SECTION 8.04. Waiver......................................................................... ARTICLE IX GENERAL PROVISIONS SECTION 9.01. Non-Survival of Representations, Warranties, and Agreements.................... SECTION 9.02. Disclosure Schedules........................................................... SECTION 9.03. Notices........................................................................ SECTION 9.04. Certain Definitions............................................................ SECTION 9.05. Mitigation and Reimbursement........................................... SECTION 9.06. Headings....................................................................... SECTION 9.07. Severability................................................................... SECTION 9.08. Entire Agreement............................................................... SECTION 9.09. Assignment..................................................................... SECTION 9.10. Parties in Interest............................................................ SECTION 9.11. Governing Law.................................................................. SECTION 9.12. Counterparts................................................................... SECTION 9.13. Enforcement of Agreement.......................................................
AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER, dated as of April 27, 2004 (the “Agreement”), between ASSOCIATED BANC-CORP, a Wisconsin corporation (“Associated”) and FIRST FEDERAL CAPITAL CORP, a Wisconsin corporation (the “Company”).
WHEREAS, the Company, upon the terms and subject to the conditions of this Agreement and in accordance with the Wisconsin Business Corporation Law (“Wisconsin Law”) will merge with and into Associated (the “Merger”); and
ARTICLE I
SECTION 1.01. The Merger. Upon the terms and subject to the conditions set forth in this Agreement, and in accordance with Wisconsin Law, at the Effective Time (as defined in Section 1.02), the Company shall be merged with and into Associated. As a result of the Merger, the separate corporate existence of the Company shall cease and Associated shall continue as the surviving corporation of the Merger (the “Surviving Corporation”).
SECTION 1.02. Effective Time. The parties hereto shall cause the Merger to be consummated by filing Articles of Merger (the “Articles of Merger”) with the Department of Financial Institutions of the State of Wisconsin, in such form as required by, and executed in accordance with the relevant provisions of, Wisconsin Law (a) after the satisfaction or, if permissible, waiver of conditions set forth in Article VII, and (b) as promptly as possible within the thirty (30) day period commencing with the latest of the following dates:
(i) The date of expiration of any applicable waiting period after approval by the Board of Governors of the Federal Reserve System (the “Federal Reserve Board”) under the Bank Holding Company Act of 1956, as amended (the “BHCA”); |
(ii) Such date as may be prescribed by the Federal Reserve Board or any other agency or authority pursuant to applicable law, rules, or regulations, prior to which consummation of the transaction described and referred to herein may not be effected; |
(iii) The date of the shareholders meeting of the Company to vote upon and approve the Merger pursuant to Section 6.02; or |
(iv) If the transaction contemplated by this Agreement is being contested in any legal proceeding and Associated or the Company has elected to contest the same, the date that such legal proceeding has been brought to a non-appealable conclusion sufficiently favorable, in the judgment of Associated and the Company, to permit consummation of the transaction contemplated hereby. |
The date and time of the filing of the Articles of Merger with the Wisconsin Department of Financial Institutions, or on such later date or later time as specified in the Articles of Merger, is hereinafter referred to as the “Effective Time.” In no event shall the Effective Time occur prior to August 1, 2004. Notwithstanding anything herein to the contrary, with respect to the calendar quarter in which the Effective Time is to occur, Associated and the Company will cooperate not to set the Effective Time on a date that is after the record date for Associated’s regular quarterly dividend for such quarter, if any, and before the record date for the Company’s regular quarterly dividend for such quarter, if any, in order to prevent the Company’s shareholders from not being entitled to receive either dividend for such quarter.
SECTION 1.03. Effect of the Merger. At the Effective Time, the effect of the Merger shall be as provided in the applicable provisions of Wisconsin Law. Without limiting the generality of the foregoing, and subject thereto, at the Effective Time, except as otherwise provided herein, all the property, rights, privileges, powers, and franchises of Associated and the Company shall vest in the Surviving Corporation, and all debts, liabilities, and duties of Associated and the Company shall become the debts, liabilities, and duties of the Surviving Corporation.
.........(a) each share of common stock, par value $0.10 per share, of the Company (the “Company Common Stock”) (all issued and outstanding shares of the Company Common Stock being hereinafter collectively referred to as “Shares”) issued and outstanding immediately prior to the Effective Time (other than any Shares to be canceled pursuant to Section 1.06(b)) shall, at the election of the holder of each Share, (i) be converted, in accordance with Section 1.07, into the right to receive 0.635 (such ratio, as it may be adjusted pursuant to the terms of this Agreement, the “Exchange Ratio”) shares of common stock, par value $0.01 per share, of Associated (“Associated Common Stock”) or (ii) be converted into the right to receive Cash Consideration (as defined below); provided, however, that ten percent (10%) of the Company Common Stock to be converted pursuant to the Merger shall consist of the aggregate of (i) the Company Common Stock that will be converted to Cash Consideration, and (ii) the Company Common Stock that will be converted into the right to receive cash in lieu of Fractional Shares (as defined in Section 1.07(f)) if any pursuant to Section 1.07(f). Cash Consideration shall be the amount of cash equal to the product obtained by multiplying the Exchange Ratio by the Associated Common Stock closing price on the date of the Effective Time. As of the Effective Time, all such Shares shall no longer be outstanding and shall automatically be canceled and retired and shall cease to exist, and each Certificate (as defined in Section 1.07(c)) shall thereafter represent the right to receive a certificate representing shares of Associated Common Stock into which such Shares are convertible and/or Cash Consideration. Certificates shall be exchanged for certificates representing whole shares of Associated Common Stock issued in consideration therefor and/or for Cash Consideration and cash in lieu of Fractional Shares (if any) upon the surrender of such Certificates in accordance with the provisions of Section 1.07, without interest. No Fractional Shares (if any) shall be issued, and, in lieu thereof, a cash payment shall be made pursuant to Section 1.07(f) hereof. Under no circumstances shall the total Shares converted to Cash Consideration and Shares converted to the right to receive cash in lieu of Fractional Shares (if any) represent more or less than ten percent (10%) of the Company Common Stock to be converted pursuant to the Merger.
.........(b) each share of Company Common Stock held in the treasury of the Company and each Share owned by Associated or any direct or indirect wholly owned Associated Subsidiaries (as defined in Section 3.01) immediately prior to the Effective Time shall be canceled and extinguished without any conversion thereof and no payment shall be made with respect thereto.
.........(c) (i) Each Election Form (as defined in Section 1.07(b)) shall permit the holder of Shares (or the beneficial owner through appropriate and customary documentation and instructions), other than Shares to be cancelled in accordance with Section 1.06(b), to (A) elect to receive Associated Common Stock with respect to all or a portion of such holder’s Shares (a “Stock Election”) and/or (B) elect to receive cash with respect to all or a portion of such holder’s Company Common Stock (a “Cash Election”). Shares as to which a Stock Election is made are referred to herein as “Stock Election Shares,” and Shares as to which a Cash Election is made are referred to herein as “Cash Election Shares.” Any Shares with respect to which the holder (or the beneficial owner, as the case may be) shall not have submitted to the Exchange Agent an effective, properly completed Election Form on or before 5:00 P.M., Central Time, on the business day that is two business days prior to the Effective Time (the “Election Deadline”) shall be deemed to be Stock Election Shares. Any such election shall have been properly made only if the Exchange Agent shall have actually received a properly completed Election Form by the Election Deadline. Any Election Form may be revoked or changed by the person submitting such Election Form prior to the Election Deadline. Subject to the terms of this Agreement and of the Election Form, the Exchange Agent shall have reasonable discretion to determine whether any election, revocation or change has been properly or timely made and to disregard immaterial defects in the Election Forms, and any good faith decisions of the Exchange Agent regarding such matters shall be binding and conclusive. None of Associated, the Company and the Exchange Agent shall be under any obligation to notify any person of any defect in an Election Form.
......... (ii) If the number of Cash Election Shares is, when considered together with the number of shares of Company Common Stock to be converted into cash to be paid in lieu of Fractional Shares, equal to more or less than ten percent (10%) of the total Shares, Associated and the Company will reduce or increase the number of Cash Election Shares by the number necessary to cause the Cash Election Shares to equal ten percent (10%) of the total Shares. If there is an excess of Cash Election Shares, the number of Cash Election Shares which may not be so converted into Cash Consideration shall be converted into Stock Election Shares and exchanged for Associated Common Stock in accordance with Section 1.06(a), with the reduction in Cash Election Shares to be made pro rata among the shareholders of the Company making Cash Elections based upon the number of Shares for which each such shareholder has made a Cash Election. If there is a deficiency of Cash Election Shares, the number of Stock Election Shares which may not be so converted into shares of Associated Common Stock, shall be converted into Cash Election Shares and exchanged for Cash Consideration in accordance with Section 1.06(a), with the reduction in Stock Election Shares to be made pro rata among the shareholders of the Company making Stock Elections based on the number of shares for which each such shareholder has made a Stock Election.
SECTION 1.07. Exchange of Certificates.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company hereby represents and warrants to Associated that:
SECTION 2.01. Organization and Qualification of the Company, Bank, and the Company Subsidiaries. The Company is a corporation duly organized and validly existing under the laws of the State of Wisconsin. The Bank is a duly organized and validly existing federally chartered savings bank headquartered in La Crosse, Wisconsin, and a wholly owned subsidiary of the Company. First Cap Holdings, Inc. (“FCHI”) is a duly organized and validly existing Nevada corporation and wholly owned subsidiary of the Bank. First Reinsurance, Inc. (“FRI”) is a duly organized and validly existing Arizona corporation and a wholly owned subsidiary of the Bank. First Enterprises, Inc. (“FEI”) is a duly organized and validly existing Wisconsin corporation and wholly owned subsidiary of the Bank. FF Mortgage Reinsurance, Inc. (“FFMRI”) is a duly organized and validly existing Vermont corporation and wholly owned subsidiary of FEI. Turtle Creek Corporation (“TCC”) is a duly organized and validly existing Wisconsin corporation and wholly owned subsidiary of the Bank. Except as set forth in the Company Disclosure Schedule at Section 2.01, the Bank, FCHI, FRI, FEI, FFMRI, and TCC are the only direct or indirect subsidiaries of the Company. The Company and the Company Subsidiaries each have the requisite corporate power and authority and are in possession of all franchises, grants, authorizations, licenses, permits, easements, consents, certificates, approvals, and orders (“Company Approvals”) necessary to own, lease, and operate their respective properties and to carry on their respective business as they are now being conducted, except where the failure to be so organized, existing, or in good standing or to have such power, authority, and Company Approvals would not, individually or in the aggregate, have a Material Adverse Effect (as defined below) on the Company and the Company Subsidiaries when taken as a whole. The term “Material Adverse Effect” as used in this Agreement shall mean any change or effect that is or is reasonably likely to be materially adverse to the business, operations, properties (including intangible properties), condition (financial or otherwise), prospects, assets, or liabilities (including contingent liabilities) of a party and its subsidiaries, taken as a whole, or which would prevent or materially delay consummation of the Merger or otherwise prevent such party performing its obligations under this Agreement and shall be deemed to include, without limitation, (a) with respect to the Company or any Company Subsidiary any changes or effects that result in, or are reasonably likely to result in (within the period beginning with the Effective Time and ending twelve (12) months therefrom), a cost, expense, or liability (including contingent liability), individually or in the aggregate, in an amount of $7.5 million or greater on the Company and the Company Subsidiaries, when taken as a whole, or an effect, individually or in the aggregate, of $4.0 million or more on the Company’s consolidated earnings on an after-tax basis and (b) with respect to Associated or any Associated Subsidiary any changes or effects that result in, or are reasonably likely to result in (within the period beginning with the Effective Time and ending twelve (12) months therefrom), a cost, expense, or liability (including contingent liability, individually or in the aggregate, in an amount of $60 million or greater on Associated and the Associated Subsidiaries, when taken as a whole, or an effect, individually or in the aggregate, of $35 million or more on Associated’s consolidated earnings on an after-tax basis; provided, however, that no assessment or proposed assessment by the Wisconsin Department of Revenue relating to the income or reallocation to a party of income from a Nevada entity shall be considered a Material Adverse Effect or included in the computation of any Material Adverse Effect unless, with respect to the Company or any Company Subsidiary, the Company breaches its obligations pursuant to Section 4.01(o) or 4.02(o); and provided further, however, that no changes or events relating to the mortgage servicing revenue allowance of a party shall be considered a Material Adverse Effect or included in the computation of any Material Adverse Effect as long as such allowance has been and will continue to be determined in accordance with GAAP (as defined in Section 2.07(b) below). The Company has not received any notice of proceedings relating to the revocation or adverse modification, or proceeding with respect to any Company Approvals. The Company and each of the Company Subsidiaries are duly qualified or licensed as a foreign corporation to do business, and are in good standing, in each jurisdiction where the character of the properties owned, leased, or operated by them or the nature of their activities makes such qualification or licensing necessary, except for such failures to be so duly qualified or licensed and in good standing that would not have a Material Adverse Effect on the Company. The Company is registered with the Office of Thrift Supervision (“OTS”) as a savings and loan holding company under the Home Owner’s Loan Act (the “HOLA”). Except as set forth in the Disclosure Schedule of the Company attached hereto (the “Company Disclosure Schedule”) at Section 2.01, the Company does not hold any interest, either directly or indirectly, in any other entity except the Company Subsidiaries. Except as set forth in the Company Disclosure Schedule at Section 2.01, the Bank holds no interest, either directly or indirectly, in any other entity except for FCHI, FRI, FEI, FFMRI, and TCC.
SECTION 2.03. Capitalization.
SECTION 2.05. No Conflict; Required Filings and Consents.(a) Except as set forth at Section 2.05 of the Company Disclosure Schedule, the execution and delivery of this Agreement by the Company does not, and the performance of this Agreement by the Company shall not, (i) conflict with or violate the Articles of Incorporation or Bylaws of the Company or any of the Company Subsidiaries, (ii) conflict with or violate any domestic (federal, state, or local) or foreign law, statute, ordinance, rule, regulation, order, judgment, or decree (collectively, “Laws”) applicable to the Company or any of the Company Subsidiaries, or by which their respective properties are bound or affected, or (iii) result in any breach of or constitute a default (or an event that with notice or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration, or cancellation of, or result in the creation of a lien or encumbrance on, any of the properties or assets of the Company or any of the Company Subsidiaries pursuant to any note, bond, mortgage, indenture, contract, agreement, lease, license, permit, franchise, or other instrument or obligation to which the Company or any of the Company Subsidiaries are a party or by which the Company or any of the Company Subsidiaries or any of their respective properties are bound or affected, except for any such breaches, defaults, or other occurrences that would not have a Material Adverse Effect on the Company.
(b) The execution and delivery of this Agreement by the Company does not, and the performance of this Agreement by the Company will not, require, with respect to the Company, any consent, approval, authorization, or permit of, or filing with or notification to, any governmental or regulatory authority, domestic or foreign, or any other person except (i) for applicable requirements, if any, of the Securities Act of 1933, as amended (the “Securities Act”), and the Securities Exchange Act of 1934, as amended (the “Exchange Act”), state securities or blue sky laws (“Blue Sky Laws”), the BHCA, the HOLA, the banking laws and regulations of the State of Wisconsin (the “BL”), any applicable antitrust authorities, and the filing and recordation of appropriate merger or other documents as required by Wisconsin Law and federal banking laws, or (ii) where the failure to obtain such consents, approvals, authorizations, or permits, or to make such filings or notifications would not have a Material Adverse Effect on the Company.
SECTION 2.07. Banking Reports, SEC Reports, and Financial Statements.(a) The Company and the Company Subsidiaries have timely filed all forms, reports, and documents required to be filed with the Federal Reserve Board, the Wisconsin Department of Financial Institutions, the Federal Deposit Insurance Corporation, the Office of Thrift Supervision, and any other applicable federal or state banking authorities (all such reports and statements are collectively referred to as the “Company Bank Reports”). The Company Bank Reports, including all Company Bank Reports filed after the date of this Agreement, (i) were or will be prepared in accordance with the requirements of applicable law, and (ii) did not at the time they were filed, or will not at the time they are filed, contain any untrue statement of material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading, unless corrected by a subsequent filing made (y) prior to the date of this Agreement for reports and documents filed before the date of this Agreement and (z) by the earlier of (A) 15 days of the filing date of the report or document being corrected or (B) 15 days prior to the Effective Time, for reports and documents filed after the date of this Agreement.
(b) Each of the consolidated financial statements (including, in each case, any related notes thereto) of the Company and the Company Subsidiaries contained in the Company Bank Reports, including any Company Bank Reports filed since the date of this Agreement and prior to or on the Effective Time, have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) applied on a consistent basis throughout the periods involved (except as may be indicated in the notes thereto), and each fairly presents the consolidated financial position of the Company and the Company Subsidiaries as of the respective dates thereof and the consolidated results of their operations and changes in financial position for the periods indicated, except any unaudited interim financial statements were or are subject to normal and recurring year-end adjustments which were not or are not expected to be material in amount or effect. With respect to the Company and the Company Subsidiaries, for purposes of this Section 2.07, any amount or effect in excess of $1 million shall be deemed material.
.........(c) The Company has on a timely basis filed all forms, reports, and documents required to be filed by it with the Securities and Exchange Commission (“SEC”) since January 1, 2001. The Company Disclosure Schedule at Section 2.07(c) lists and (except to the extent available in full without redaction on the SEC’s web site through the Electronic Data Gathering, Analysis and Retrieval System (“XXXXX”) two days prior to the date of this Agreement) the Company has delivered to Associated true and complete copies in the form filed with the SEC of (i) the Company’s Annual Reports on Form 10-K for each fiscal year of the Company ending on or after December 31, 1999; (ii) its Quarterly Reports on Form 10-Q for each of the first three fiscal quarters in each of the fiscal years of the Company referred to in clause (i) above; (iii) all proxy statements relating to the Company’s meetings of shareholders (whether annual or special) held, and all information statements relating to shareholder consents since the beginning of the first fiscal year referred to in clause (i) above; (iv) all certifications and statements required by (A) Rule 13a-14 or 15d-14 under the Exchange Act or (B) 18 U.S.C. § 1350 (Section 906 of the Xxxxxxxx-Xxxxx Act of 2002 (“SOX”)) with respect to any report referred to in clause (i) or (ii) above; (v) all other forms, reports, registration statements, and other documents (other than preliminary materials if the corresponding definitive materials have been provided to Associated pursuant to this Section 2.07(c)) filed by the Company with the SEC since the beginning of the first fiscal year referred to in clause (i) above (the forms, reports, registration statements, and other documents referred to in clauses (i), (ii), (iii), (iv), and (v) above are, collectively, the “Company SEC Reports” and, to the extent available in full without redaction on the SEC’s web site through XXXXX two days prior to the date of this Agreement, are, collectively, the “Filed Company SEC Reports”); and (vi) all comment letters received by the Company from the staff of the SEC since January 1, 2001, and all responses to such comment letters by or on behalf of the Company. All matters and statements made in the certifications and statements referred to in clause (iv) above are accurate. The Company SEC Reports (x) were or will be prepared in accordance with the requirements of the Securities Act and the Exchange Act, as applicable, and the rules and regulations thereunder and (y) did not at the time they were filed with the SEC, or will not at the time they are filed with the SEC, contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading. No Company Subsidiary is or has been required to file any form, report, registration statement, or other document with the SEC or any state authority. The Company maintains disclosure controls and procedures as required by Rule 13a-15 or 15d-15 under the Exchange Act. The Company Disclosure Schedule at Section 2.07(c) lists, and the Company has delivered to Associated, true and complete copies of all written descriptions of and all policies, manuals, and other documents promulgating such disclosure controls and procedures. Except as disclosed in Filed Company SEC Reports, each director and executive officer of the Company has filed with the SEC on a timely basis complete and accurate versions of all statements required by Section 16(a) of the Exchange Act and the rules and regulations thereunder since January 1, 2001. As used in this Section 2.07(c), the term “filed” shall be broadly construed to include any manner in which a document or information is furnished, supplied, or otherwise made available to the SEC, including, but not limited to, as may be required pursuant to Item 9 or 12 of Form 8-K.
.........(d) The consolidated financial statements of the Company and the Company Subsidiaries included or incorporated by reference in any Company SEC Reports (including the related notes) complied as to form, as of the respective dates of filing of such Company SEC Reports with the SEC, in all material respects with applicable accounting requirements and the rules and regulations of the SEC with respect thereto (including, without limitation, Regulation S-X), have been prepared in accordance with GAAP (except, in the case of unaudited financial statements, to the extent permitted by Regulation S-X for Quarterly Reports on Form 10-Q) applied on a consistent basis throughout the periods involved (except as may be indicated in the notes thereto) and fairly present the consolidated financial condition of the Company and the Company Subsidiaries at the dates thereof and the consolidated results of operations and cash flows for the periods then ended (subject, in the case of unaudited statements, to notes and normal year-end audit adjustments that were not, or with respect to any such financial statements contained in any Company SEC Reports to be filed subsequent to the date hereof are not expected to be, material in amount or effect). The Company Disclosure Schedule at Section 2.07(d) lists, and the Company has delivered to Associated copies of the documentation creating or governing, all “off-balance sheet arrangements” (as defined in Item 303(a)(4) of Regulation S-K) in effect with respect to the Company or any of the Company Subsidiaries during any period covered by any of the Company SEC Reports that was required to be disclosed in any Company SEC Report. Deloitte & Touche LLP, which has expressed its opinion with respect to the consolidated financial statements of the Company and the Company Subsidiaries included in Company SEC Reports (including the related notes) filed after June 30, 2003, (x) is a registered public accounting firm (as defined in Section 2(a)(12) of SOX), (y) to the Company’s knowledge, after reasonable inquiry, is and has been throughout the periods covered by such financial statements “independent” with respect to the Company within the meaning of Regulation S-X, and (z) to the Company’s knowledge, after reasonable inquiry, is, and has been throughout the periods covered by such financial statements, with respect to the Company, in compliance with subsections (g) through (l) of Section 10A of the Exchange Act. Ernst & Young LLP, which expressed its opinion with respect to the consolidated financial statements of the Company and the Company Subsidiaries included in Company SEC Reports (including the related notes) filed prior to June 30, 2003, (y) to the Company’s knowledge, after reasonable inquiry, was throughout the periods covered by such financial statements “independent” with respect to the Company within the meaning of Regulation S-X, and (z) to the Company’s knowledge, after reasonable inquiry, was throughout the periods covered by such financial statements, with respect to the Company, in compliance with subsections (g) through (l) of Section 10A of the Exchange Act. The Company Disclosure Schedule at Section 2.07(d) lists all non-audit services performed by Deloitte & Touche LLP or Ernst & Young LLP for the Company or any of the Company Subsidiaries since January 1, 2003.
(e) Except as and to the extent set forth on the consolidated balance sheet of the Company and the Company Subsidiaries as of December 31, 2003, including all notes thereto (the “Company Balance Sheet”), neither the Company nor the Company Subsidiaries has any liabilities or obligations of any nature (whether accrued, absolute, contingent, or otherwise) that would be required to be reflected on a balance sheet, or in the notes thereto, prepared in accordance with GAAP, except (i) for liabilities or obligations incurred in the ordinary course of business since December 31, 2003, that would not have a Material Adverse Effect on the Company, or (ii) as otherwise reflected in the Filed Company SEC Reports.
SECTION 2.10. Employee Benefit Plans.(a) The following definitions will apply for purposes of this Agreement:
(i) ADA. Americans with Disabilities Act.
(ii) ADEA. Age Discrimination in Employment Act.
(iii) COBRA. Part 6 of Subtitle B of Title I of ERISA and section 4980B of the Code.
(iv) Code. The Internal Revenue Code of 1986, as amended, and the regulations, rulings, and forms issued thereunder.
(v) DOL. The United States Department of Labor.
(vi) EGTRRA. The Economic Growth and Tax Relief Reconciliation Act of 2001.
(vii) Employee Benefit Plan. Any Pension Plan, Welfare Plan, or Fringe Benefit Plan, whether written or oral and whether qualified or non-qualified, and any trust, escrow, or other agreement covering any present or former directors, officers, employees, or their respective dependents.
(viii) ERISA. The Employee Retirement Income Security Act of 1974, as amended, and the rules, regulations, and forms issued thereunder.
(ix) ERISA Affiliate. Any entity (whether or not incorporated) which is or was, together with the Company (for purposes of Section 2.10) or Associated (for purposes of Section 3.18), treated as a single employer under section 414(b), (c), (m), or (o) of the Code.
(x) Fringe Benefit Plans. Any fringe benefit plan under Code sections 125, 127, 129, 132, or 137 and any bonus, incentive compensation, restricted stock, other stock-based incentive, salary continuation, bonus plan, employment-related change in control benefit, and any other payment or benefit which is not within the meaning of a Pension Plan or Welfare Plan. The term “Fringe Benefit Plan” shall also include any terminated fringe benefit plan previously maintained, sponsored, or contributed to by the Company (for purposes of Section 2.10) or Associated (for purposes of Section 3.18) or any ERISA Affiliate which, as of the signing of this Agreement, has not distributed all of its assets or satisfied all of its Liabilities.
(xi) GUST. Collectively, the Uruguay Round Agreements Act (“GATT”), the Uniformed Services Employment and Reemployment Rights Act of 1994, the Small Business Job Protection Act of 1996, the Taxpayer Relief Act of 1997, the Internal Revenue Service Restructuring and Reform Act of 1998 and the Community Renewal Tax Relief Act of 2001.
(xii) HIPAA. The Health Insurance Portability and Accountability Act of 1996.
(xiii) IRS. The United States Internal Revenue Service.
(xiv) Liability. Any direct or indirect obligation, indebtedness, commitment, expense, claim, deficiency, guaranty, endorsement, or other liability of any kind, whether known or unknown, direct or indirect, accrued or unaccrued, absolute or contingent, disputed or undisputed, and whether or not the same is required to be accrued on financial statements.
(xv) Pension Plan. Each “employee pension benefit plan” as defined in section 3(2) of ERISA. The term “Pension Plan” includes an “employee pension benefit plan” which is subject to an exemption under ERISA. The term “Pension Plan” shall also include any terminated “employee pension benefit plan” previously maintained, sponsored, or contributed to by the Company (for purposes of Section 2.10) or Associated (for purposes of Section 3.18) or an ERISA Affiliate which, as of the signing of this Agreement, has not distributed all of its assets in full satisfaction of accrued benefits or satisfied all of its Liabilities.
(xvi) Welfare Plan. Each “employee welfare plan” as defined in ERISA section 3(1), including medical reimbursement benefits provided under a Fringe Benefit Plan subject to Code section 125 and health reimbursement arrangements. The term “Welfare Plan” includes an “employee welfare plan” which is subject to an exemption under ERISA. The term “Welfare Plan” shall include any terminated “employee welfare plan” previously maintained, sponsored, or contributed to by the Company (for purposes of Section 2.10) or Associated (for purposes of Section 3.18) or any ERISA Affiliate which, as of the signing of this Agreement, has not distributed all of its assets or satisfied all of its Liabilities.
.........(b) The Company Disclosure Schedule at Section 2.10 lists all Employee Benefit Plans maintained, sponsored, or contributed to by the Company or any ERISA Affiliate or under which the Company or any ERISA Affiliate has any Liability.
.........(c) The Company has made available to Associated true and complete copies of (i) each Employee Benefit Plan and a written summary of any Employee Benefit Plan not in writing; (ii) the most recent opinion letter received from the IRS with respect to any Employee Benefit Plan; (iii) the summary plan description, all summaries of material modifications, employee booklets, and all other material communications to employees with respect to any Employee Benefit Plan; (iv) any service agreement, including third-party administration agreements or other contracts related to each Employee Benefit Plan; (v) the three most recent annual reports on Form 5500 required to be filed for each Employee Benefit Plan including required attachments; (vi) the three most recent actuarial reports, if applicable; (vii) all related trust agreements, annuity contracts, insurance contracts, including stop-loss insurance contracts or other funding arrangements which relate to any Employee Benefit Plan, and the most recent periodic accounting of related plan assets; (viii) a description of the investments in which the assets of each Pension Plan and funded Welfare Plan are invested, including any agreements with investment managers, agreements with investment advisors, group annuity contracts, and a listing of all mutual funds or other investment vehicles; and (ix) in the case of stock options, phantom stock, restricted stock, stock appreciation rights, or other equity rights issued under any Employee Benefit Plan, a list of holders, dates of grant, number of shares, exercise price per share, and dates exercisable.
.........(d) Each Pension Plan that is intended to be a qualified plan under Code section 401(a) has received and maintains a current favorable determination letter issued by the IRS. There are no existing circumstances or events that have occurred that could reasonably be expected to adversely affect the qualified status of any such Pension Plan. Each such qualified Pension Plan was timely amended for all applicable legislation, including GUST and EGTRRA, and there are no additional amendments necessary to maintain each such qualified Pension Plan as a qualified plan under Code section 401(a). Each Pension Plan has been operated in accordance with the applicable Pension Plan document and the requirements of ERISA, the Code, and applicable regulations in all respects. There are no pending or prior applications that have been filed on behalf of a Pension Plan with the IRS under the Employee Plans Compliance Resolution System (“EPCRS”) that have not been fully resolved and corrected as required by the IRS, and the Company has provided Associated copies of any closing agreement or other documentation describing the resolution of such prior EPCRS applications. Except as set forth in Section 2.10(d) of the Company Disclosure Schedule, none of the Pension Plans that are intended to be qualified retirement plans under Code section 401(a) hold Company Common Stock or the stock of any ERISA Affiliates as an investment.
.........(e) The Company and ERISA Affiliates have maintained and operated each Employee Benefit Plan in compliance with the applicable plan documents and all applicable Laws relating to the Employee Benefit Plans (including, without limitation, the Code, ERISA, HIPAA, USERRA, ADEA, FMLA, and ADA and the applicable regulations and rulings under each of these laws), except for any failure to comply which would not result in liability to the Company or any Company Subsidiary in excess of $250,000, individually or in the aggregate. The Company and ERISA Affiliates have incurred no Liability to any governmental agency in connection with any Employee Benefit Plan.
.........(f) The Company or ERISA Affiliates, as applicable, have made all contributions required to be made pursuant to the terms of any Employee Benefit Plan or any collective bargaining agreement to which it is a party or as otherwise required by applicable Law. Amounts accrued to date as Liabilities in connection with any Employee Benefit Plan of the Company or any ERISA Affiliate which have not been paid have been properly recorded on the books of the Company in accordance with GAAP and, if applicable, Code section 412. With respect to each Employee Benefit Plan, all insurance premiums have been paid in full and on a timely basis for all periods ending on or prior to the signing of this Agreement. No contribution made to an Employee Benefit Plan was subject to an excise tax under Code section 4972 that has not been satisfied in full. All contributions and payments by the Company and any ERISA Affiliate in respect of any Employee Benefit Plan have been or are fully deductible under the Code.
.........(g) Except as set forth in Section 2.10(g) of the Company Disclosure Schedule, the Company and ERISA Affiliates do not (at this time or any prior time) sponsor, maintain, or contribute to any defined benefit plan or any multi-employer plan within the meaning of ERISA section 3(37).
.........(h) With respect to any insurance policy providing funding or benefits under any Employee Benefit Plan, (i) there is no actual or potential Liability of the Company or ERISA Affiliates in the nature of a retroactive or retrospective rate adjustment, loss sharing arrangement, or other actual or contingent liability, nor would there be any such liability if such insurance policy was terminated at the signing of this Agreement; and (ii) no insurance company issuing any such policy is in receivership, conservatorship, liquidation, or similar proceeding and, to the knowledge of the Company, no such proceedings with respect to any insurer are imminent. If an Employee Benefit Plan is self-funded and the Company or an ERISA Affiliate is party to a stop-loss insurance policy with respect to such Employee Benefit Plan, the Company or ERISA Affiliate has complied with all terms of the stop-loss policy and has timely paid all premiums owing with respect to such stop-loss policy through the signing of this Agreement. The transactions contemplated by this Agreement will not cancel, impair, or reduce amounts payable under any such stop-loss insurance policy.
.........(i) All reports, notices, and descriptions of the Employee Benefit Plans (including, without limitation, Form 5500 annual reports, summary annual reports, summary plan descriptions, summaries of material modifications, and employee notices) required to be filed or distributed by the Company or any ERISA Affiliate have been timely filed with the IRS or the DOL, as applicable, and, as appropriate, have been timely provided to the participants and beneficiaries in the Employee Benefit Plans. Any Pension Plan which is a retirement plan exempt from Parts 2, 3, and 4 of Subtitle B of ERISA as an unfunded retirement plan established for a select group of management or highly compensated employees has timely filed the one-time notice with the DOL required pursuant to DOL Regulation section 2520.104-23. There are no pending or prior applications that have been filed on behalf of an Employee Benefit Plan with the DOL under the Delinquent Filer Voluntary Compliance program (“DFVC”) that have not been fully resolved and corrected as required by the DOL, and the Company has provided Associated copies of any closing agreement or other documentation describing the resolution of such prior DFVC applications.
.........(j) With respect to each Employee Benefit Plan (i) no non-exempt prohibited transaction, as defined in ERISA section 406 or Code section 4975, has occurred, (ii) neither the Company, any ERISA Affiliate, nor any of their current or former directors, officers, employees, or any other “fiduciary,” within the meaning of ERISA section 3(21), has committed any breach of fiduciary responsibility imposed by ERISA or any other applicable law, or has any Liability for failure to comply with ERISA or the Code for any action or failure to act in connection with the operation, administration, or investment of the assets of any Employee Benefit Plan. There is no pending, threatened, or anticipated action, audit, suit, grievance, arbitration, or other manner of litigation or claim relating to any Employee Benefit Plan (other than routine claims for benefits). Neither the Company, ERISA Affiliates, nor any of their directors, officers, employees, or any fiduciary of any Employee Benefit Plan has any knowledge of any facts that could give rise to arbitration, litigation, or claims with respect to any Employee Benefit Plan. Each “fiduciary” and every “plan official” (as defined in section 412 of ERISA) of each Employee Benefit Plan is bonded or otherwise insured to the extent required by section 412 of ERISA. The Company and ERISA Affiliates are not subject to an excise tax under Code section 4977, 4978, 4979, 4979A, 4980, 4980D, or 4980F that has not been satisfied in full. There have been no investigations or audits of any Employee Benefit Plan by any governmental authority that have been concluded that resulted in any Liability to the Company or ERISA Affiliates that has not been fully discharged, and the Company has provided Associated copies of any closing letter, closing agreement, or other documentation describing the resolution of such prior audits or investigations.
.........(k) Following the adoption, restatement, or amendment of all Employee Benefit Plans as provided to Associated, the Company, ERISA Affiliates, and any of their officers or directors have taken no action directly or indirectly which obligates the Company or ERISA Affiliates to institute or modify or change any Employee Benefit Plan, any actuarial or other assumption used to calculate funding obligations with respect to any of the Company’s and ERISA Affiliate’s Employee Benefit Plans, or the manner in which contributions to any of the Employee Benefit Plans are made or the basis on which such contributions are determined.
.........(l) No Employee Benefit Plan is funded through a “welfare benefit fund” as defined in Code section 419(e), and neither the Company nor any ERISA Affiliate has established or maintained any arrangement that could be deemed to qualify as a funded welfare plan. The Company and ERISA Affiliates have not incurred any liability under Code section 4976 that has not been satisfied in full.
.........(m) Except as set forth in Section 2.10(m) of the Company Disclosure Schedule, no Employee Benefit Plan provides medical, life, or other welfare benefits (whether or not insured), with respect to persons who are not current employees of the Company or ERISA Affiliates (other than coverage mandated by COBRA). With respect to any Employee Benefit Plan required to be disclosed in Section 2.10(m) of the Company Disclosure Schedule, the Company has disclosed to Associated all documents relating to the Employee Benefit Plan that have been provided to participants. Further, with respect to any Employee Benefit Plan required to be disclosed in Section 2.10(m) of the Company Disclosure Schedule, documents relating to the Employee Benefit Plan that have been provided to participants have, from the inception of the Employee Benefit Plan to the present, informed participants that the Company reserves the right to terminate or amend the Employee Benefit Plan at any time. Each Employee Welfare Plan that is a “group health plan” within the meaning of Code section 5000 has been operated in compliance with the applicable plan document, COBRA, ERISA, the administrative simplification provisions of HIPAA, as applicable, the secondary payor requirements of section 1862(b) of the Social Security Act, and applicable state law requirements, except for any failure to comply which would not result in liability to the Company or any Company Subsidiary in excess of $250,000, individually or in the aggregate. No Employee Welfare Plan or Fringe Benefit Plan provides benefits for persons who are not eligible for coverage under the terms of such plans. No claim for medical benefits has been incurred (but not reported) under any Employee Welfare Plan (subject to the Company’s knowledge with respect to claims incurred after January 27, 2004) with respect to any current or former employee (or the spouse or dependent of such employee) that is in excess of $25,000. The Company’s financial statements, as of the signing of this Agreement, will contain adequate accruals for incurred or continuing but unpaid claims under Employee Benefit Plans not funded by insurance.
.........(n) Except as disclosed in the Company Disclosure Schedule at Section 2.10(n), the consummation of the transactions contemplated by this Agreement will not (i) entitle any present or former director, officer, or employee of the Company or ERISA Affiliates to severance pay, unemployment compensation, excess parachute payments (within the meaning of section 280G of the Code), or any other payment; (ii) accelerate the time of payment or vesting of benefits under any of the Employee Benefit Plans; or (iii) increase the amount of compensation or benefits due under any of the Employee Benefit Plans with respect to any such present or former director, officer, or employee of the Company or any of the Company Subsidiaries.
SECTION 2.13. Title to Property. The Company Disclosure Schedule at Section 2.13 correctly identifies all real property owned, leased, or used by the Company or any of the Company Subsidiaries. The Company and each of the Company Subsidiaries have good and defensible title to all of their properties and assets, real and personal, tangible and intangible, free and clear of all mortgage liens, and free and clear of all other liens, charges, and encumbrances except liens for taxes not yet due and payable, pledges to secure deposits, liens as set forth in the Company Disclosure Schedule at Section 2.13, and such minor imperfections of title, if any, as to not materially detract from the value of or interfere with the present use of the property affected thereby or which, individually or in the aggregate, would not have a Material Adverse Effect on the Company and the Company Subsidiaries, individually or when taken as a whole. All leases pursuant to which the Company or any of the Company Subsidiaries lease from others real or personal property including, without limitation, leases for branch offices, are in good standing, valid, effective, binding, and enforceable in accordance with their respective terms, and there is not or there has not occurred, under any of such leases, any existing material default or event of default (or event which with notice or lapse of time, or both, would constitute a material default and in respect of which the Company or any of the Company Subsidiaries have not taken adequate steps to prevent such a default from occurring). The Company’s and each of the Company Subsidiaries’ buildings and equipment in regular use have been reasonably maintained and are in good and serviceable condition, reasonable wear and tear excepted. None of the buildings, structures, or appurtenances owned or leased by the Company or any of the Company Subsidiaries for their operation or maintenance as now operated or maintained, contravenes any zoning ordinances or other administrative regulations (whether or not permitted because of prior non-conforming use), or violates any restrictive covenant or any provision of Law, the effect of which would materially interfere with or prevent the continued use of such properties for the purposes for which they are now being used or would materially and adversely affect the value thereof.
SECTION 2.14. Compliance with Environmental Laws.(a) The term “Company’s Property” shall mean any real property and improvements currently owned, leased, used, operated, or occupied by the Company or any of the Company Subsidiaries. The term “Company’s Property” shall also include any real property or improvements acquired by foreclosure, property which the Bank has a present right to acquire upon foreclosure and which are owned by customers of the Bank who have received written notification of default and for which the Company or any Company Subsidiary has obtained an environmental evaluation or report, and properties held or operated in a fiduciary or managerial capacity.
(b) The term “Environmental Claims” shall mean any and all administrative, regulatory, or judicial actions, suits, demands, demand letters, claims, liens, notices of noncompliance or violation, investigations, or proceedings relating in any way to any applicable Environmental Law or Environmental Permit.
(c) The term “Environmental Laws” shall mean all federal, state, and local Laws including statutes, regulations, and other governmental restrictions and requirements relating to the discharge of air pollutants, water pollutants, or process wastewater or the disposal of solid or hazardous waste or otherwise relating to the environment or hazardous substances or employee health and safety.
(d) The term “Environmental Permits” shall mean all permits, approvals, identification numbers, licenses, and other authorizations required under any applicable Environmental Law.
(e) The term “Hazardous Substances” shall mean all hazardous and toxic substances, wastes, and materials; any pollutants or contaminants (including, without limitation, petroleum products, asbestos, and raw materials, which include hazardous constituents); and any other similar substances or materials which are regulated under applicable Environmental Laws.
(f) To the Company’s Knowledge, the Environmental Permits (if any) are in full force and effect and constitute all permits, licenses, approvals, and consents relating to Environmental Laws or Hazardous Substances required for the conduct of the Company’s and each of the Company Subsidiaries’ respective businesses and the use of the Company’s Property (as presently conducted and used) in compliance with applicable Environmental Laws.
(g) The Company and each of the Company Subsidiaries have filed all reports, returns, and other filings required to be filed with respect to the Company’s Property under Environmental Laws and the Environmental Permits except where the failure to do so would not have a Material Adverse Effect on the Company. Except as set forth at Section 2.14(g) of the Company Disclosure Schedule, neither the Company nor any of the Company Subsidiaries has made any environmental filings after December 31, 2003.
(h) To the Company’s knowledge, the business of the Company and each of the Company Subsidiaries and the Company’s Property have been and are being operated in accordance with all applicable Environmental Laws and Environmental Permits. Neither the Company nor any of the Company Subsidiaries has received any written notice nor does the Company or any of the Company Subsidiaries have knowledge that any of the Company’s Property is not in material compliance with all Environmental Laws and Environmental Permits and no proceeding for the suspension, revocation, or cancellation of any Environmental Permit is pending or, to the knowledge of the Company, threatened.
(i) There are no actions pending, or to the knowledge of the Company, threatened against the Company or any of the Company Subsidiaries which in any case assert or allege (i) the Company or any of the Company Subsidiaries violated any Environmental Law or Environmental Permit or is in default with respect to any Environmental Permit or any order, writ, judgment, variance, award, or decree of any government authority issued under any Environmental Law; (ii) the Company or any of the Company Subsidiaries is required to clean up or take remedial or other response action due to the disposal, discharge, or other release of any Hazardous Substance on the Company’s Property or elsewhere; or (iii) the Company or any of the Company Subsidiaries are required to contribute to the cost of any past, present, or future cleanup or remedial or other response action which arises out of or is related to the disposal, discharge, or other release of any Hazardous Substance by the Company, the Company Subsidiaries, or others. None of the Company, any of the Company Subsidiaries, or any of the Company’s Property is subject to any judgment, stipulation, order, decree, or agreement arising under Environmental Laws.
(j) To the Company’s knowledge, with respect to the Company’s Property, (i) no Hazardous Substances have been treated, recycled, or disposed of by the Company or any of the Company Subsidiaries (intentionally or unintentionally) on, under, or at the Company’s Property; (ii) there has been no release or threatened release by the Company or any of the Company Subsidiaries of any Hazardous Substance on or from the Company’s Property; and (iii) there have been no activities on the Company’s Property which would subject Associated, Associated Subsidiaries, or any subsequent occupier of the Company’s Property to damages, penalties, injunctive relief, or cleanup costs under any Environmental Laws or common law theory of liability.
SECTION 2.18. Absence of Adverse Agreements. Except as set forth at Section 2.18 of the Company Disclosure Schedule, neither the Company nor any of the Company Subsidiaries is a party to any agreement (written or otherwise) or instrument or any judgment, order, or decree or any rule or regulation of any court or other governmental agency or authority which has or could reasonably be expected to have a Material Adverse Effect on the Company. Except as set forth at Section 2.18 of the Company Disclosure Schedule, the Company is not subject to any obligations pursuant to any agreement relating to the Company’s acquisition of Liberty Bancshares, Inc.
SECTION 2.21. Related Party Transactions.
.........(a) Except as disclosed in the Company Disclosure Schedule at Section 2.21(a), no officer, director, affiliate, or employee of the Company or any of the Company Subsidiaries (each, a “Company Related Party”) (i) has or has had since January 1, 2001, any direct or indirect interest in any property (whether real, personal, or mixed and whether tangible or intangible), used in or pertaining to the business of the Company or any of the Company Subsidiaries; (ii) has or has had since January 1, 2001, any direct or indirect interest in any transaction with the Company or any of the Company Subsidiaries (other than the ownership of up to (but not more than) one percent of any class of securities of any company if such securities are listed on any national securities exchange or have been registered under section 12(g) of the Exchange Act); or (iii) is a party to any contract with, or has any claim or right against, the Company or any of the Company Subsidiaries. The Company Disclosure Schedule at Section 2.21(a) contains a true and complete description of any such transaction or relationship, including, but not limited to, where applicable, (i) the name of the Company Related Party, (ii) the name of any other person with a direct or indirect interest in the transaction, (iii) the nature of the Company Related Party’s interest in the transaction, (iv) the amount of the transaction; (v) the amount of the Company Related Party’s interest in the transaction; and (vi) any interest in the Company or any of the Company Subsidiaries by any other person with a direct or indirect interest in the transaction.
.........(b) To the knowledge of the Company, except as disclosed in the Company Disclosure Schedule at Section 2.21(b) or the Filed Company SEC Reports or under the Company’s employee stock purchase plan or employee stock ownership plan, no officer, director, or affiliate of the Company or any of the Company Subsidiaries has, within six months prior to the date of this Agreement, directly or indirectly purchased or sold, or had any direct or indirect interest in any entity which purchased or sold, any shares of Company Common Stock, any other equity securities of the Company or any of the Company Subsidiaries or any option, warrant, convertible security, stock appreciation right, or other right with respect to any shares of Company Common Stock or other equity securities of the Company or any of the Company Subsidiaries.
.........(c) To the knowledge of the Company, no transaction required to be disclosed pursuant to Section 2.21(a) or (b) violated any applicable Law.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF ASSOCIATED
Associated hereby represents and warrants to the Company that:
SECTION 3.05. No Conflict; Required Filings and Consents.(a) The execution and delivery of this Agreement by Associated does not, and the performance of this Agreement by Associated shall not, (i) conflict with or violate the Articles of Incorporation or Bylaws of Associated, (ii) conflict with or violate any Laws applicable to Associated or Associated Subsidiaries or by which their respective properties are bound or affected, or (iii) result in any breach of or constitute a default (or an event that with notice or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration, or cancellation of, or result in the creation of a lien or encumbrance on any of the properties or assets of Associated or any Associated Subsidiaries pursuant to any note, bond, mortgage, indenture, contract, agreement, lease, license, permit, franchise, or other instrument or obligation to which Associated or Associated Subsidiary is a party or by which Associated or Associated Subsidiary or any of their properties are bound or affected, except for any such breaches, defaults, or other occurrences that would not, individually or in the aggregate, have a Material Adverse Effect on Associated.
(b) The execution and delivery of this Agreement by Associated does not, and the performance of this Agreement by Associated shall not, require, with respect to Associated, any consent, approval, authorization, or permit of, or filing with or notification to, any governmental or regulatory authority, domestic or foreign, or any other person except (i) for applicable requirements, if any, of the Securities Act, the Exchange Act, Blue Sky Laws, the BHCA, the HOLA, the BL, any applicable antitrust authorities, and the filing and recordation of appropriate merger or other documents as required by Wisconsin Law and national banking laws, or (ii) where the failure to obtain such consents, approvals, authorizations, or permits, or to make such filings or notifications, would not prevent or delay consummation of the Merger, or otherwise prevent Associated from performing its obligations under this Agreement, and would not have a Material Adverse Effect on Associated.
SECTION 3.07. SEC Reports, and Financial Statements.(a) Except as set forth at Section 3.07 of the Associated Disclosure Schedule, Associated has on a timely basis filed all forms, reports, and documents required to be filed by it with the SEC since January 1, 2001. The Associated Disclosure Schedule at Section 3.07(a) lists and (except to the extent available in full without redaction on the SEC’s web site through XXXXX two days prior to the date of this Agreement) Associated has delivered to the Company true and complete copies in the form filed with the SEC of (i) Associated’s Annual Reports on Form 10-K for each fiscal year of Associated ending after January 1, 2001; (ii) its Quarterly Reports on Form 10-Q for each of the first three fiscal quarters in each of the fiscal years of Associated referred to in clause (i) above; (iii) all proxy statements relating to Associated’s meetings of shareholders (whether annual or special) held, and all information statements relating to shareholder consents since the beginning of the first fiscal year referred to in clause (i) above; (iv) all certifications and statements required by (A) Rule 13a-14 or 15d-14 under the Exchange Act or (B) 18 U.S.C. § 1350 (Section 906 of SOX) with respect to any report referred to in clause (i) or (ii) above; (v) all other forms, reports, registration statements and other documents (other than preliminary materials if the corresponding definitive materials have been provided to the Company pursuant to this Section 3.07(a)) filed by Associated with the SEC since the beginning of the first fiscal year referred to in clause (i) above (the forms, reports, registration statements and other documents referred to in clauses (i), (ii), (iii), (iv), and (v) above are, collectively, the “Associated SEC Reports” and, to the extent available in full without redaction on the SEC’s web site through XXXXX two days prior to the date of this Agreement, are, collectively, the “Filed Associated SEC Reports”); and (vi) all comment letters received by Associated from the staff of the SEC since January 1, 2001, and all responses to such comment letters by or on behalf of Associated. All matters and statements made in the certifications and statements referred to in clause (iv) above are accurate. The Associated SEC Reports (x) were or will be prepared in accordance with the requirements of the Securities Act and the Exchange Act, as applicable, and the rules and regulations thereunder and (y) did not at the time they were filed with the SEC, or will not at the time they are filed with the SEC, contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading. Except as set forth at Section 3.07(a) of the Associated Disclosure Schedule, no Associated Subsidiary is or has been required to file any form, report, registration statement, or other document with the SEC or any state authority. Associated maintains disclosure controls and procedures as required by Rule 13a-15 or 15d-15 under the Exchange Act. As used in this Section 3.07(a), the term “filed” shall be broadly construed to include any manner in which a document or information is furnished, supplied, or otherwise made available to the SEC, including, but not limited to, as may be required pursuant to Item 9 or 12 of Form 8-K.
.........(b) The consolidated financial statements of Associated and Associated Subsidiaries included or incorporated by reference in any Associated SEC Reports (including the related notes) complied as to form, as of the respective dates of filing of such Associated SEC Reports with the SEC, in all material respects with applicable accounting requirements and the rules and regulations of the SEC with respect thereto (including, without limitation, Regulation S-X), have been prepared in accordance with GAAP (except, in the case of unaudited financial statements, to the extent permitted by Regulation S-X for Quarterly Reports on Form 10-Q) applied on a consistent basis throughout the periods involved (except as may be indicated in the notes thereto) and fairly present the consolidated financial condition of Associated and Associated Subsidiaries at the dates thereof and the consolidated results of operations and cash flows for the periods then ended (subject, in the case of unaudited statements, to notes and normal year-end audit adjustments that were not, or with respect to any such financial statements contained in any Associated SEC Reports to be filed subsequent to the date hereof are not expected to be, material in amount or effect). The Associated Disclosure Schedule at Section 3.07(b) lists, and Associated has delivered to the Company copies of the documentation creating or governing, all “off-balance sheet arrangements” (as defined in Item 303(a)(4) of Regulation S-K) in effect with respect to Associated or any Associated Subsidiary during the period covered by any of the Associated SEC Reports that was required to be disclosed in any Associated SEC Report. KPMG LLP, which has expressed its opinion with respect to the consolidated financial statements of Associated and Associated Subsidiaries included in the Associated SEC Reports (including the related notes) (x) is a registered public accounting firm (as defined in Section 2(a)(12) of SOX), (y) to Associated’s knowledge, after reasonable inquiry, is and has been throughout the periods covered by such financial statements “independent” with respect to Associated within the meaning of Regulation S-X, and (z) with respect to Associated, to Associated’s knowledge, after reasonable inquiry, is in compliance with subsections (g) through (l) of Section 10A of the Exchange Act.
(c) Except as and to the extent set forth on the consolidated balance sheet of Associated and Associated Subsidiaries as of December 31, 2003, including all notes thereto (the “Associated Balance Sheet”), neither Associated nor any Associated Subsidiaries have any liabilities or obligations of any nature (whether accrued, absolute, contingent, or otherwise) that would be required to be reflected on a balance sheet or in the notes thereto prepared in accordance with GAAP, except (i) for liabilities or obligations incurred in the ordinary course of business since December 31, 2003, that would not, individually or in the aggregate, have a Material Adverse Effect on Associated, or (ii) as otherwise reflected in the Filed Associated SEC Reports.
SECTION 3.18. Employee Benefit Plans.
.........(a) The Associated Disclosure Schedule at Section 3.18 lists all Employee Benefit Plans maintained, sponsored, or contributed to by Associated or any ERISA Affiliate or under which Associated or any ERISA Affiliate has any Liability.
.........(b) Associated has made available to the Company true and complete copies of each Employee Benefit Plan and a written summary of any Employee Benefit Plan not in writing.
.........(c) Associated and ERISA Affiliates have maintained and operated each Employee Benefit Plan in material compliance with the applicable plan documents and all applicable Laws relating to the Employee Benefit Plans (including, without limitation, the Code, ERISA, HIPAA, USERRA, ADEA, FMLA, and ADA and the applicable regulations and rulings under each of these laws).
SECTION 3.19. Compliance with Environmental Laws..........(a) The term “Associated’s Property” shall mean any real property and improvements currently owned, leased, used, operated, or occupied by Associated or any of Associated’s Subsidiaries. The term “Associated’s Property” shall also include any real property or improvements acquired by foreclosure and properties held or operated in a fiduciary or managerial capacity.
.........(b) Associated’s and each of Associated Subsidiaries’ respective businesses and the use of Associated’s Property (as presently conducted and used) are in compliance with applicable Environmental Laws, except where the failure to comply would not have a Material Adverse Effect on Associated. Associated and each of Associated’s Subsidiaries have filed all reports, returns, and other filings required to be filed with respect to Associated’s Property under Environmental Laws and the Environmental Permits except where the failure to do so would not have a Material Adverse Effect on Associated.
ARTICLE IV
(a) operate its business only in the usual, regular, and ordinary course consistent with past practices;
(b) use best efforts to preserve intact its business organization and assets, maintain its rights and franchises, retain the services of its officers and key employees, and maintain its relationships with customers;
(c) use best efforts to maintain and keep its properties in as good repair and condition as at present, ordinary wear and tear excepted;
(d) use best efforts to keep in full force and effect insurance and bonds comparable in amount and scope of coverage to that now maintained by it;
(e) perform in all material respects all obligations required to be performed by it under all material contracts, leases, and documents relating to or affecting its assets, properties, and business;
(f) with respect to the Company on a consolidated basis, maintain as of March 31, 2004, and thereafter, an aggregate loan loss reserve of not less than 0.54% of period ending loans (excluding overdrafts less than 30 days old) in accordance with GAAP, together with any additions to such reserve required for new problem loans in accordance with GAAP consistently applied;
(g) purchase and sell securities in accordance with the guidelines set forth on Exhibit 4.01(g);
(h) comply with the capital requirements set forth in Exhibit 4.01(h);
(i) with respect to the Company on a consolidated basis, maintain as of March 31, 2004, and thereafter, a tax reserve of not less than an amount determined in accordance with GAAP consistently applied;
(j) engage in lending activities, extensions of credit, and other financing or leasing arrangements in accordance with the guidelines set forth in Exhibit 4.01(j);
(k) take all reasonable steps to assure that any transactions in the stock of the Company or the Subsidiaries by “affiliates” of the Company, including, without limitation, all directors and executive officers of the Company for purposes of Rule 145 promulgated under the Securities Act, shall be conducted in accordance with all applicable laws, rules, and regulations;
(l) comply in a timely manner with all applicable requirements of the Securities Act, the Exchange Act, SOX, state securities laws, and the rules and regulations thereunder, and all applicable listing and corporate governance requirements of the NASDAQ and maintain the listing of the Company Common Stock on NASDAQ;
(m) notify Associated prior to the commencement of any investigation regarding, or upon receipt by the Company of any allegation of, any possible violation by the Company, any of the Company Subsidiaries, or any director, officer, employee, or affiliate of the Company or any of the Company Subsidiaries of (i) applicable law, (ii) the listing standards of NASDAQ, or (iii) any code of conduct or ethics applicable to any directors, officers, or employees of the Company or any of the Company Subsidiaries and, after consultation with Associated, take all reasonable actions in the conduct of any such investigation or the response to any such allegations; and
(n) notify Associated of the receipt of any complaints (actual or constructive) or allegations of actual or potential violations by the Company, any of the Subsidiaries, or any director, officer, employee, or affiliate of the Company or any of the Subsidiaries of (i) applicable Law, (ii) the listing standards of NASDAQ, or (iii) any code of conduct or ethics applicable to any directors; officers, or employees of the Company or any of the Subsidiaries and, after consultation with Associated, take all reasonable actions in the conduct of any such investigation or the response to any such allegations; and
(o) obtain the consent of Associated prior to furnishing any information to, substantively communicating with or entering into any discussions or negotiations with, the Wisconsin Department of Revenue relating to the income or reallocation to the Company or any Company Subsidiary of income of a Nevada entity.
..................(a) (i) grant any general increase in compensation to its employees as a class, or to its officers or directors, except in accordance with past practice or as required by Law or increases which are not material, (ii) effect any change in retirement benefits to any class of employees or officers (unless any such change shall be required by applicable law) which would increase its retirement benefit liabilities, (iii) adopt, enter into, amend, or modify any employee benefit plan or make any adjustments pursuant to any employee benefit plan except as required by law or (iv) enter into or amend any employment, severance, or similar agreements or arrangements with any directors or officers, other than as is consistent with the normal severance policies of the Company and each of the Company Subsidiaries in effect on the date of this Agreement; anything to the contrary notwithstanding, the Company shall be required to obtain the consent of Associated prior to effecting any of the changes identified in (i) through (iv) only to the extent that the activities result individually in an increase in cost or expense (current or future) in an amount greater than $15,000 or in the aggregate in an increase in cost or expense (current or future) in an amount greater than $250,000;
(b) declare or pay any dividend on, or make any other distribution in respect of, its outstanding shares of capital stock, except that the Company may declare and pay a regular quarterly cash dividend per share not exceeding $0.15 per share;
..................(c) (i) redeem, purchase, or otherwise acquire any shares of its capital stock or any securities or obligations convertible into or exchangeable for any shares of its capital stock, or any options, warrants, conversion, or other rights to acquire any shares of its capital stock or any such securities or obligations; (ii) merge with or into any other corporation or bank, permit any other corporation or bank to merge into it, or consolidate with any other corporation or bank, or effect any reorganization or recapitalization; (iii) purchase or otherwise acquire any assets or stock of any corporation, bank, or other business, other than in the ordinary course of its business, consistent with past practice and not in excess of $250,000 individually or in the aggregate, or except as set forth at Section 4.02(c) of the Company Disclosure Schedule; (iv) liquidate, sell, dispose of, or encumber any assets or acquire any assets, other than in the ordinary course of its business, consistent with past practice; or (v) split, combine, or reclassify any of its capital stock or issue or authorize or propose the issuance of any other securities in respect of, in lieu of, or in substitution for shares of its capital stock;
(d) issue, deliver, award, grant, or sell or authorize or propose the issuance, delivery, award, grant, or sale of any shares of any class of its capital stock (including shares held in treasury) (except for the issuance of shares in connection with the exercise of any option outstanding on the date of this Agreement in accordance with its terms) or any rights, warrants, or options to acquire any such shares;
(e) initiate, solicit, or encourage (including by way of furnishing information or assistance), or take any other action to facilitate, any inquiries or the making of any proposal that constitutes, or may reasonably be expected to lead to, any Competing Transaction (as such term is defined below), or negotiate with any person in furtherance of such inquiries or to obtain a Competing Transaction, or agree to or endorse any Competing Transaction, or authorize or permit any of its officers, directors, or employees or any investment banker, financial advisor, attorney, accountant, or other representative retained by it or any of the Company Subsidiaries to take any such action, and the Company shall promptly notify Associated orally and in writing of all of the relevant details relating to all inquiries and proposals which it may receive relating to any of such matters; provided, however, that nothing contained in this subsection (e) shall prohibit the Board of Directors of the Company from furnishing or permitting any of its officers, directors, employees, investment bankers, financial advisors, attorneys, accountants, or other representatives to furnish information to any party that requests information as to the Company or any of the Company Subsidiaries if (i) the Board of Directors of the Company, after consultation with and based upon the written advice of independent counsel, determines in good faith that such action is required for the Board of Directors of the Company to comply with its fiduciary duties to shareholders imposed by Wisconsin Law; (ii) prior to furnishing such information to such person, the Company provides Associated with at least seven days’ notice to the effect that it is furnishing information to such person; and (iii) prior to furnishing such information to such party, the Company receives from such party an executed confidentiality agreement in customary form. For purposes of this Agreement, “Competing Transaction” shall mean any of the following involving the Company or any of the Company Subsidiaries: (i) any merger, consolidation, share exchange, business combination, or other similar transactions; (ii) any sale, lease, exchange, mortgage, pledge, transfer, or other disposition of ten percent or more of assets in a single transaction or series of transactions, excluding from the calculation of the percentage hereunder any such transactions undertaken in the ordinary course of business and consistent with past practice; (iii) any sale of ten percent or more of shares of capital stock (or securities convertible or exchangeable into or otherwise evidencing, or any agreement or instrument evidencing, the right to acquire capital stock); (iv) any tender offer or exchange offer for ten percent or more of outstanding shares of capital stock; (v) any solicitation of proxies in opposition to approval by the Company’s shareholders of the Merger; (vi) the filing of an acquisition application (or the giving of acquisition notice) whether in draft or final form under the BHCA, the HOLA or the Change in Bank Control Act with respect to the Company or any of the Company Subsidiaries; (vii) any person shall have acquired beneficial ownership or the right to acquire beneficial ownership of, or any “group” (as such term is defined under Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder) shall have been formed which beneficially owns or has the right to acquire beneficial ownership of, 10% or more of the then outstanding shares of capital stock of the Company; or (viii) any public announcement of a proposal, plan, or intention to do any of the foregoing.
(f) propose or adopt any amendments to the corporate charter or Bylaws in any way materially adverse to Associated;
(g) except in their fiduciary capacities for the account of customers, purchase any shares of Associated Common Stock;
(h) change any of its methods of accounting in effect at December 31, 2003, or change any of its methods of reporting income or deductions for federal income tax purposes from those employed in the preparation of the federal income tax returns for the taxable year ending December 31, 2003, except as may be required by Law or GAAP;
(i) subject to Section 4.01(j), change any lending, investment, liability management, or other material policies concerning the business or operations of the Company or any of the Company Subsidiaries in any material respect; organize any new Company Subsidiaries or enter into any new non-banking line of business, whether or not permissible under applicable Law; or make any material changes in its operations;
..................(j) (i) incur or assume any material obligation or liability (except deposit liabilities in the ordinary course of business), including without limitation any obligation for borrowed money, whether or not evidenced by a note, bond, debenture, or similar instrument and whether or not being incurred to reduce other existing liabilities, or make any loan (not including any loan renewal of a loan not then classified as “substandard,” “doubtful,” “loss,” “other loans especially mentioned,” or any comparable classifications by the Company or any of the Company Subsidiaries, or banking regulators and not including any loans made in accordance with Section 4.01(j) and 4.01(h)) or investment (including U.S. Treasury Securities) (excluding investments made in accordance with Section 4.01(g)) in an amount greater than Two Hundred Fifty Thousand Dollars ($250,000); (ii) assume, guarantee, endorse, or otherwise become liable or responsible (whether directly, contingent, or otherwise) for the obligations of any other person or entity; (iii) mortgage, license, pledge, or grant a security interest in any of its material assets or allow to exist any material lien thereon, except (A) for liabilities and obligations (including corporate debt issuances) incurred in the ordinary course of business consistent with past practices and in amounts not material to the Company or any of the Company Subsidiaries and (B) as may be required under existing agreements to which the Company or any of the Company Subsidiaries is a party; (iv) acquire assets (including equipment) or securities in excess of Two Hundred Fifty Thousand Dollars ($250,000) in the aggregate (excluding loans to customers and investments permitted in (i) above); (vi) pay, discharge, or satisfy any debts or claims not in the ordinary course of business and consistent with past practices; (vii) settle any claim, action, suit, litigation, proceeding, arbitration, investigation, or controversy of any kind, for any amount in excess of Two Hundred Fifty Thousand Dollars ($250,000) or in any manner which would restrict in any material respect the operations or business of the Company or any of the Company Subsidiaries (excluding matters relating to assessments by the Wisconsin Department of Revenue relating to the income or reallocation of income of a Nevada entity, which are addressed in Section 4.01(o) and 4.02(o)); (viii) purchase any new financial product or instrument which involves entering into a contract with a term of six months or longer (excluding investments made in accordance with Section 4.01(g)); or (ix) take any action or fail to take any action which individually or in the aggregate can be expected to have a Material Adverse Effect on the Company, or (x) incur or pay legal and accounting fees in connection with the transaction contemplated hereby in excess of an aggregate of the budget discussed and investment banking fees in connection with the transaction contemplated hereby in excess of the amount determined pursuant to the engagement letter dated March 16, 2004 between the Company and Sandler X’Xxxxx & Partners, L.P.;
.........(k) for any plan year, depending on the applicable plan, accrue for, contribute to or pay through any Pension Plan, Welfare Plan, or Fringe Benefit Plan an amount (determined as a percentage of compensation paid to participants), larger than the amount contributed to such plan for the previous plan year of such plan (determined as a percentage of compensation paid to participants) unless (i) such amount does not exceed $500,000 in the aggregate with respect to all plans during any twelve month period; or (ii) as required by law; provided, however, that in no event may any change other than as required by law be made to the terms of any such plan (including, but not limited to, changes to eligibility or benefit levels);
.........(l) effect a change, directly or indirectly, or enter into any agreement directly or indirectly, which would result in a change in any insurance policy or benefit, including, but not limited to, entering into or purchasing any new insurance policies (except as allowed in Section 4.02(j)(viii)), disposing of any insurance policies, changing the nature or scope of any interest in any existing policies, or making additional contributions to any insurance policy, except as required to keep the policy in force; provided, however, that nothing contained herein shall prevent the Company or any of the Company Subsidiaries from renewing or replacing as they expire any existing coverage relating to their normal operations on substantially similar terms as current coverage (except for required premium increases), or from purchasing additional insurance coverages relating to cyber coverage;
...................(m) enter into any transaction or relationship described in Section 2.21(a);(n) amend, modify, renegotiate, or change any agreement, contract, commitment, obligation, or other instrument to which the Company or any of the Company Subsidiaries is a party or is otherwise bound and which is material to the Company or any of the Company Subsidiaries, individually or when taken as a whole;
..................(o) pay any assessment by the Wisconsin Department of Revenue, or enter into any agreement, substantive discussions, negotiations, settlement or compromise, relating to the income or reallocation to the Company or any Company Subsidiary of income of a Nevada entity; or
(p) agree in writing or otherwise to do any of the foregoing.
SECTION 4.03. Access and Information.
(a) Prior to the Effective Time and upon reasonable notice and without unreasonable disruption to the business carried on by the Company or the Company Subsidiaries, the Company shall (and shall cause the Company Subsidiaries to) afford to Associated’s officers, employees, accountants, legal counsel, and other representatives access, during normal business hours, to all its properties, books, contracts, commitments, and records (other than the portion of Company board of director minutes which discuss this or any other merger proposals or Competing Transactions). Prior to the Effective Time, the Company shall (and shall cause the Company Subsidiaries to) furnish promptly to Associated (i) a copy of each Company Bank Report filed by it (to the extent permitted by Law) after the date of this Agreement and prior to the Effective Time pursuant to the requirements of federal or state securities laws, the BHCA, the HOLA, any other federal or state banking laws, or any other applicable laws promptly after such documents are available; (ii) a copy of each Company SEC Report filed by it or received by it after the date of this Agreement; and (iii) the monthly consolidated financial statements of the Company and the Company Subsidiaries.
(b) Any information provided to Associated by the Company or any of the Company Subsidiaries, whether prior to or subsequent to the date of this Agreement, shall be kept confidential by the representatives of Associated (and shall be used by them only in connection with this Agreement and the transactions contemplated hereby) except to the extent that (i) it was already known to such representatives when received, (ii) it hereafter becomes lawfully obtainable from other sources, or (iii) it is required to be disclosed by Associated in any document required to be filed with any government authority or agency, which disclosure shall be treated by Associated as if it were disclosing its own information and limited to the minimum amount of information required to be disclosed. Upon any termination of this Agreement pursuant to Article VIII hereof, Associated agrees to promptly return all information and documents that it has obtained from the Company in connection herewith.
(a) Except as provided in Section 8.02, below, all Expenses (as defined below) incurred by Associated and the Company shall be borne solely and entirely by the party which has incurred the same.
(b) “Expenses” as used in this Agreement shall include all out-of-pocket expenses (including without limitation, all fees and expenses of counsel, accountants, investment bankers, experts, and consultants to the party and its affiliates) incurred by a party or on its behalf in connection with or related to the authorization, preparation, and execution of this Agreement, the solicitation of shareholder approvals, and all other matters related to the closing of the transactions contemplated hereby.
.........(a) Savings Investment Plan (the “401(k) Plan”). The Company will make all amendments to the 401(k) Plan as required by law. The Company will continue to permit participant elective deferrals and to make and accrue matching and profit sharing contributions to the 401(k) Plan until such time as Associated shall determine that is on or after the later of December 31, 2004 or the Effective Time, but in no event more than 180 days after the Effective Time (the “401(k) Plan Benefit Conversion Date”). At Associated’s option, the 401(k) Plan may be merged into the Associated Banc-Corp 401(k) Profit Sharing and Employee Stock Ownership Plan (the “Associated 401(k) Plan”). Effective the 401(k) Plan Benefit Conversion Date, if the plans are merged, employees participating in the 401(k) Plan will begin participating in the Associated 401(k) Plan.
.........(b) Employee Stock Ownership Plan (the “ESOP”). The Company will make all amendments to the ESOP as required by law. The Company will continue to make company contributions to the ESOP until such time as Associated shall determine that is on or after the later of December 31, 2004 or the Effective Time, but in no event more than 180 days after the Effective Time (the “ESOP Benefit Conversion Date”). At Associated’s option, the ESOP may be merged into the Associated 401(k) Plan. Effective the ESOP Benefit Conversion Date, if the plans are merged, employees participating in the ESOP will begin participating in the Associated 401(k) Plan.
.........(c) Pension Plan (the “Pension Plan”). The Company will make all amendments to the Pension Plan as required by law. The Company will continue to make contributions to the Pension Plan and permit benefit accruals to Pension Plan participants (other than Frozen Participants as defined in the Pension Plan) until such time as Associated shall determine that is on or after the later of December 31, 2004 or the Effective Time, but in no event more than 180 days after the Effective Time (the “Pension Plan Benefit Conversion Date”). At Associated’s option, the Pension Plan may be merged into the Associated Banc-Corp Retirement Account Plan (the “Associated Retirement Plan”). Effective the Pension Plan Benefit Conversion Date, if the plans are merged, employees participating in the Pension Plan (including Frozen Participants) will begin participating in the Associated Retirement Plan.
.........(d) Work Force Plan (the “Work Force Plan”). Prior to the Effective Time, the Company will amend the Work Force Plan, a copy of which plan, as it shall be amended, is attached hereto as Exhibit 4.07(d), and will continue the Work Force Plan as so amended and comply with the Work Force Plan’s terms. The Company will extend the Work Force Plan for 18 months following the Effective Time, and will continue to comply with the terms of the Work Force Plan for 18 months following the Effective Time. Thereafter, the Company’s employees, subject to and in accordance with the terms thereof, shall be eligible for the Associated Banc-Corp Work Force Management Plan only. (e) Company Medical Plan and Company Group Dental Plan (the “Health Plan”) and Company Flexible Benefit Plan (the “Flexible Plan”). The Company will continue to sponsor and maintain the Health Plan and the Flexible Plan as in existence on the date hereof until, with respect to each such plan, such time as Associated shall determine that is on or after the later of December 31, 2004 or the Effective Time, but no event more than 180 days after the Effective Time (the “Health Plan Benefit Conversion Date” or “Flexible Plan Benefit Conversion Date,” respectively). Thereafter, the Company’s eligible employees will be eligible to participate in Associated’s health, dental, and flexible benefit plans. The Company will continue coverage of existing participants receiving continuation coverage pursuant to Part 6 of ERISA. The Company will offer continuation coverage as limited by Part 6 of ERISA to any Company employees who terminate employment (or experience any other “Qualifying Event” as defined in ERISA section 603) with the Company, as required by the agreements identified in Schedule 2.10. Switching from the Health Plan and Flexible Plan to Associated’s health program and flexible benefits plan as of the Health Plan Benefit Conversion Date and Flexible Plan Benefit Conversion Date, respectively, will not constitute a “Qualifying Event” as defined in ERISA section 603.
.........(f) The Company Equity Incentive Plans (the “Equity Incentive Plans”). With respect to any Company Stock Options under the Equity Incentive Plans that are exercised by Equity Incentive Plan participants from the date of this Agreement to the Effective Time, the Company will report for tax purposes (including the filing of Internal Revenue Service forms W-2 or similar forms) the value of the stock at the time of exercise (which value is the fair market value of a share of Company Common Stock on the date of exercise less the exercise price of the Company Stock Option) times the number of Company Stock Options exercised. Under the Equity Incentive Plans, Company Stock Options held by participants will become fully vested as of the Effective Time, and all Company Stock Options issued under the Equity Incentive Plans shall be converted pursuant to Section 1.10. With respect to any restricted stock outstanding under the Equity Incentive Plans, interests in Company Common Stock held by participants will become fully vested as of the Effective Time, and all Company Common Stock issued under the Equity Incentive Plans shall be converted pursuant to Section 1.06.
ARTICLE V
(a) operate its business only in the usual, regular, and ordinary course consistent with past practices and maintain its corporate existence in good standing and maintain all books and records in accordance with accounting principles and practices as utilized in Associated’s financial statements applied on a consistent basis;
(b) conduct its business in a manner that does not violate any Law, except for possible violations which individually or in the aggregate do not have a Material Adverse Effect on Associated and its subsidiaries, taken as a whole, and insofar as reasonably can be foreseen in the future will not have a Material Adverse Effect on Associated and its subsidiaries, taken as a whole, within the period beginning with the Effective Date hereof and ending twelve (12) months thereafter;
(c) use its best efforts to comply in a timely manner with all applicable requirements of the Securities Act, the Exchange Act, SOX, state securities laws, and the rules and regulations thereunder, and all applicable listing and corporate governance requirements of NASDAQ;
(d) notify the Company upon commencement of any investigation regarding, or upon receipt by Associated of any allegation of, any possible violation by Associated, any Associated Subsidiary, or any director, officer, employee, or affiliate of Associated or any Associated Subsidiary of (i) applicable Law, (ii) the listing standards of NASDAQ, or (iii) any code of conduct or ethics applicable to any directors, officers, or employees of Associated or any Associated Subsidiary and take all reasonable actions in the conduct of any such investigation or the response to any such allegations;
(e) not declare or pay any extraordinary or special cash or preferred stock dividends or special cash or preferred stock distributions with respect to the Associated Common Stock;
(f) not propose or adopt any amendments to its Articles of Incorporation or Bylaws in any way materially adverse to the Company, except as disclosed in the filed Associated SEC Reports; and
(g) will remain “well-capitalized” under applicable regulatory capital guidelines.
SECTION 5.02. Access and Information.
(a) Prior to the Effective Time and upon reasonable notice and without unreasonable disruption to the business carried on by Associated or the Associated Subsidiaries, Associated shall (and shall cause the Associated Subsidiaries to) afford to the Company’s officers, employees, accountants, legal counsel, and other representatives access, during normal business hours, to all its properties, books, contracts, commitments, and records (other than the portion of Associated board of director minutes which discuss this Merger). After the date of this Agreement and prior to the Effective Time, upon reasonable notice, Associated shall (and shall cause the Associated Subsidiaries to) furnish promptly to the Company (i) a copy of each Associated Bank Report filed by it (to the extent permitted by Law) after the date of this Agreement and prior to the Effective Time pursuant to the requirements of federal or state securities laws, the BHCA, any other federal or state banking laws, or any other applicable laws promptly after such documents are available; (ii) a copy of each Associated SEC Report filed by it or received by it; and (iii) all other information concerning the business, properties, and personnel of Associated or Associated Subsidiaries as the Company may reasonably request.
(b) Any information provided to the Company by Associated, whether prior to or subsequent to the date of this Agreement, shall be kept confidential by the representatives of the Company (and shall be used by them only in connection with this Agreement and the transactions contemplated hereby) except to the extent that (i) it was already known to such representatives when received, (ii) it hereafter becomes lawfully obtainable from other sources, or (iii) it is required to be disclosed by the Company in any document required to be filed with any government authority or agency, which disclosure shall be treated by the Company as if it were disclosing its own information and limited to the minimum amount of information required to be disclosed. Upon any termination of this Agreement pursuant to Article VIII hereof, the Company agrees to promptly return all information and documents that it has obtained from Associated in connection herewith.
SECTION 5.03. Tax Treatment. Associated will use its best efforts to cause the Merger to qualify as a reorganization under Section 368(a)(1)(A) of the Code.ARTICLE VI
SECTION 6.06. Environmental Matters.
.........Associated may elect to engage an environmental consultant (who shall be mutually agreed upon by Associated and the Company) (the “Environmental Consultant”) to conduct a preliminary environmental assessment (“Phase I”) of all or any of the parcels of Company Property. The fees and expenses of the Environmental Consultant with respect to the Phase I assessments shall be paid by Associated. The Company shall fully cooperate with Associated to provide the Environmental Consultant reasonable access to all Company Property. The Environmental Consultant shall complete and deliver the Phase I assessment reports no later than sixty (60) days after the date of this Agreement. If any environmental conditions are reported, indicated or suspected by the consultant in the Phase I reports which are or may be contrary to the representations and warranties of the Company set forth herein (the “Environmental Conditions”), without regard to any knowledge qualifiers, then the Environmental Consultant may be engaged to estimate the cost of any environmental investigation that may be reasonably appropriate to address the Environmental Conditions. Upon completion of the environmental investigation, the Environmental Consultant shall estimate the cost of any further environmental investigation, remediation or response activity that may be reasonably appropriate to address the Environmental Conditions to the point of closure/no further action. Associated shall be responsible for the cost of any investigation it elects to conduct beyond the cost of the Phase I assessments. The Company shall be responsible for the costs of any required remediation or response activities.
SECTION 6.11. Directors' and Officers' Indemnification and Insurance.(a) Associated and the Company shall cooperate, using commercially reasonable efforts, to purchase and maintain in effect, one or more so called “tail” or “run-off” directors and officers liability insurance policies with respect to wrongful acts and/or omissions committed or allegedly committed by any of the officers or directors of the Company prior to the Effective Time (“D&O Coverage”). Such D&O Coverage shall have a maximum premium of 250% of last year’s annual premium for the Company’s existing directors and officers liability insurance policy (the “Premium Limit”), an aggregate coverage limit over the term of such policy in an amount as near as possible to the aggregate annual coverage limit under the Company’s existing directors’ and officers’ liability insurance policy, with a term of up to six (6) years and shall also be as near as possible in all other material respects to such existing policy; provided, however, that if the premium for six years of D&O Coverage on such terms will exceed the Premium Limit, the Company may, with the approval of Associated, modify the term or coverage amounts so long as the premium does not exceed the Premium Limit. Notwithstanding the foregoing, the Surviving Corporation, if it so elects in its sole discretion, may purchase the aforesaid coverages for a period longer than six (6) years or at a cost in excess of the Premium Limit.
(b) In the event Associated or the Surviving Corporation or any of its successors or assigns (i) consolidates with or merges into any other person and shall not be the continuing or surviving corporation or entity of such consolidation or merger, or (ii) transfers or conveys all or substantially all of its properties and assets to any person, then, and in each such case, proper provision shall be made so that the successors and assigns of Associated or the Surviving Corporation, as the case may be, assume the obligations set forth in this section.
(c) Associated will indemnify directors and officers of the Company and Company Subsidiaries to the full extent permissible under the Company’s Articles of Incorporation, Bylaws or Wisconsin Law.
(d) The provisions of this Section 6.11 are intended to be for the benefit of, and shall be enforceable by, each Indemnified Party and his or her heirs and representatives.
SECTION 6.13. Stay Bonuses. Associated and the Company shall cooperate in good faith to establish and agree upon payment of appropriate stay bonuses for key personnel of the Company or the Company Subsidiaries (other than those Company executive officers covered by employment agreements) where the Company and Associated believe the continued employment of the person or persons in question through the Effective Time is necessary to maintain the effectiveness of the Company’s and the Company Subsidiaries’ continuing operations and/or to the integration of the businesses of the Company and Associated
ARTICLE VII
[a] the Merger will qualify as a reorganization within the meaning of section 368(a)(1)(A) of the Code;[b] the Company and Associated will each be party to a reorganization within the meaning of Section 368(b) of the Code; |
[c] no gain or loss will be recognized by any shareholder of the Company upon consummation of the Merger (except with respect to cash received in lieu of a Fractional Share (if any) or Cash Consideration paid to such shareholder); and |
[d] the basis of Associated Common Stock received by the shareholders of the Company pursuant to the Merger will be the same as that of the Company Common Stock surrendered in exchange therefor, decreased by the amount of the cash and the fair market value of the other property received and increased by the amount treated as a dividend, if any, and by the amount of gain recognized on the exchange (not including any portion of the gain that is treated as a dividend). |
(p) Compliance with Securities Laws. None of the Company, any of the Company Subsidiaries, or any director, officer, or affiliate of the Company or any of the Company Subsidiaries shall have violated in any material respect, and no claim of any kind, action, suit, litigation, proceeding, arbitration, investigation, or controversy shall be pending or threatened alleging any material violation by the Company, any of the Company Subsidiaries, or any director, officer, or affiliate of the Company or any of the Company Subsidiaries of the Securities Act, the Exchange Act, SOX, any state securities law or any rules or regulations thereunder, or any listing or corporate governance requirement of NASDAQ, that may reasonably be expected to have or result in a Material Adverse Effect on the Company.
(r) Limit on Shares Exchanged. The total amount of shares of Associated Common Stock to be issued in the Merger, including shares of Associated Common Stock subject to any New Option or other option, warrant, convertible security or other right to purchase or acquire shares of Company Common Stock outstanding immediately prior to the Effective Time, shall not exceed 20% of the issued and outstanding shares of Associated Common Stock on the date of this Agreement. As a result, Associated shall not be required to seek shareholder approval of the Merger.
(i) capital improvements in excess of $3,000,000, individually or in the aggregate, are reasonably required to maintain compliance with all Environmental Laws; or
(ii) there are contingent liabilities in excess of $3,000,000, individually or in the aggregate, affecting the Company’s Property arising under Environmental Laws or under Environmental Permits.
(u) Executive Agreements. Each executive officer of the Company listed on Exhibit 7.02(u) shall have entered into an employment or consulting agreement, a non-competition agreement and a separation agreement and general release (collectively, the “Executive Agreements”), in each case in substantially the form attached as Exhibit 7.02(u) hereto for the applicable executive officer, and each such executive officer shall have terminated as of the Effective Time all other employment or other compensation arrangements or agreements except to the extent specifically preserved in the Executive Agreement for such executive officer; provided, however, that this condition shall be deemed to be satisfied as to any executive officer who does not enter into all of the Executive Agreements applicable to that executive officer if, prior to the Effective Time, the Company terminates that executive officer’s employment in accordance with Section 5 of the executive services and settlement agreement for such executive officer in the form attached as Exhibit 7.02(u) hereto.
[a] the Merger will qualify as a reorganization within the meaning of section 368(a)(1)(A) of the Code;[b] the Company and Associated will each be party to a reorganization within the meaning of Section 368(b) of the Code; |
[c] no gain or loss will be recognized by any shareholder of the Company upon consummation of the Merger (except with respect to cash received in lieu of a Fractional Share (if any) or Cash Consideration paid to such shareholder); and |
[d] the basis of the Associated Common Stock received by the shareholders of the Company pursuant to the Merger will be the same as the basis of the Company Common Stock surrendered in exchange therefore, decreased by the amount of the cash and the fair market value of the other property received and increased by the amount treated as a dividend, if any, and by the amount of gain recognized on the exchange (not including any portion of the gain that is treated as a dividend). |
ARTICLE VIII
TERMINATION, AMENDMENT AND WAIVER
(a) This Agreement may be terminated at any time prior to the Effective Time, whether before or after approval of the matters presented in connection with the Merger by the shareholders of the Company:
(i) by mutual written consent of Associated and the Company;
(ii) by the Company or Associated (A) if there has been a breach in any material respect (except that where any statement in a representation or warranty expressly includes a standard of materiality, such statement shall have been breached in any respect) of any representation, warranty, covenant, or agreement set forth in this Agreement on the part of the nonterminating party, or (B) if any representation or warranty of the nonterminating party shall be discovered to have become untrue in any material respect (except that where any statement in a representation or warranty expressly includes a standard of materiality, such statement shall have become untrue in any respect), in either case which breach or other condition has not been cured within 15 business days or which breach by its nature cannot be cured prior to the Effective Time; provided, however, that neither the Company nor Associated shall have the right to terminate this Agreement pursuant to this Section 8.01(a)(iii) unless the breach of any representation or warranty (but not breaches of covenants or agreements), together with all other such breaches, would entitle the party receiving such representation or warranty not to consummate the transactions contemplated hereby under Section 7.02(a) (in the case of a breach of a representation or warranty by the Company) or Section 7.03(a) (in the case of a breach of a representation or warranty by Associated); and provided further that this Agreement may not be terminated pursuant to this clause (iii) by the breaching party or party making any representation or warranty which shall have become untrue in any material respect; |
(iii) by either Associated or the Company if any permanent injunction preventing the consummation of the Merger shall have become final and nonappealable; |
(iv) by either Associated or the Company if the Merger shall not have been consummated before December 31, 2004 (the “Expiration Date”) (provided that the Expiration Date shall be automatically extended to April 30, 2005 if the Merger shall not have been consummated by December 31, 2004 solely due to either or both of (A) the failure of the SEC to clear and declare effective the Registration Statement to permit mailing of the Proxy Statement/Prospectus to the Company’s shareholders a sufficient time prior to December 31, 2004 or (B) the receipt of all required governmental approvals and the expiration of all related waiting periods shall not have occurred a sufficient time prior to December 31, 2004), for a reason other than the failure of the terminating party to comply with its obligations under this Agreement; |
(v) by either Associated or the Company if the Federal Reserve Board, the OTS or the Wisconsin Department of Financial Institutions has denied approval of the Merger and neither Associated nor the Company has, within thirty (30) days after the entry of such order denying approval, filed a petition seeking review of such order as provided by applicable Law; |
(vi) by Associated, if all of the conditions set forth in Section 7.02 are not satisfied on or before the Expiration Date; |
(vii) by the Company, if all of the conditions set forth in Section 7.03 are not satisfied on or before the Expiration Date; |
(viii) by either Associated or the Company if all of the conditions set forth in Section 7.01 are not satisfied on or before the Expiration Date, for a reason other than the failure of the terminating party to comply with its obligations in this Agreement; |
(ix) by Associated if the Company’s Board of Directors (x) withdraws or modifies in a manner adverse to Associated its recommendation or approval with respect to this Agreement or the Merger, (y) makes any recommendation with respect to a Competing Transaction (including making no recommendation or stating an inability to make a recommendation), other than a recommendation to reject such Competing Transaction, or (z) takes any action prohibited by Section 4.02(e); |
(x) by Associated if, prior to the Effective Time, a Competing Transaction occurs or the Company enters into any agreement to engage in a Competing Transaction; |
(xi) by Associated if the Company fails to take the actions provided in Section 6.02 (either in breach of such Section or pursuant to the exception related to its fiduciary duties provided in such Section); or |
(xii) by the Company if both [a] the Associated Average Price (as defined below) is less than 85% of the Associated Closing Price, and [b] the number obtained by dividing the Associated Average Price by the Associated Closing Price is less than the number obtained by dividing the Final Index Price (as defined below) by the Initial Index Price (as defined below) and subtracting .15 from such quotient. If the Company makes an election to terminate this Agreement under this Section 8.01(a)(xii), the Company shall, on or before the end of the second business day after the end of the Calculation Period (as defined below), give ten days’ written notice thereof to Associated. If, during the seven-day period commencing with its receipt of such notice, Associated proposes, by notice in writing to the Company, that the Exchange Ratio shall be adjusted to equal (A) the product of Associated Closing Price multiplied by the Exchange Ratio in effect prior to such adjustment, divided by (B) the Associated Average Price (carried out to five decimal places and rounded up if the sixth decimal price is five or greater), the Company may in its sole discretion give Associated notice of acceptance of such proposal within five (5) business days of receipt thereof, in which case no termination shall have occurred and this Agreement shall remain in full force and effect in accordance with its terms (except that the Exchange Ratio shall have been so modified). |
For purposes of this Section 8.01(a)(xi):
| The “Associated Average Price” shall mean the average of the daily closing prices of a share of Associated Common Stock during the Calculation Period as quoted on NASDAQ. |
| The “Associated Closing Price” shall mean the closing price of Associated Common Stock on the date of this Agreement as quoted by NASDAQ. |
| The “Calculation Period” shall mean the ten consecutive trading days ending (i) on the third trading day prior to the day on which the Effective Time is to occur in accordance with the mutual agreement of the Company and Associated or, (ii) if the Company and Associated do not agree on the day on which the Effective Time is to occur, on the third trading day prior to the day on which the thirty day period described in Section 1.02 expires. |
| The “Final Index Price” shall mean the average of the Final Prices for all of the companies comprising the Index Group. |
| The “Final Price” of any company belonging to the Index Group shall mean the average of the daily closing prices of a share of common stock of such company, as reported on the consolidated transactions reporting system for the market or exchange on which such stock is principally traded, during the Calculation Period. |
| The “Index Group” shall mean all of those companies listed on Exhibit 8.01 hereto the common stock of which is publicly traded and as to which there is no pending publicly announced proposal at any time during the Calculation Period for such company to acquire another company or companies in transactions with a value exceeding 10% of the acquirer’s market capitalization or for such company to be acquired. |
| The “Initial Index Price” shall mean the average of the per share closing prices on the date of this Agreement, of the common stock of the companies comprising the Index Group, as reported on the consolidated transactions reporting system for the market or the exchange on which such common stock is principally traded. |
| If Associated or any company belonging to the Index Group declares a stock dividend or effects a reclassification, recapitalization, split-up, combination, exchange of shares or similar transaction between the date of this Agreement, and the end of the Calculation Period, the closing prices for the common stock of such company shall be appropriately adjusted for the purposes of the definitions above so as to be comparable to the price on the date of this Agreement. |
(b) In the event of termination and abandonment by any party as provided above, written notice shall forthwith be given to the other party, which notice shall specifically describe the basis for such termination.
SECTION 8.02. Effect of Termination.
(a) If the Merger is not consummated as the result of termination of this Agreement caused otherwise than by breach of a party hereto, the Company and Associated each shall pay its own Expenses, except as provided in Section 4.05 above, and this Agreement shall immediately terminate, except as set forth in Section 9.01 hereof, and neither the Company nor Associated shall have any liability under this Agreement for damages or otherwise.
(b) If termination of this Agreement shall have been caused by breach of this Agreement by any party hereto, then, in addition to other remedies at law or equity for breach of this Agreement, the party so found to have breached this Agreement shall indemnify and reimburse the other party for its expenses.
(c) Anything to the contrary notwithstanding, if (i) this Agreement is terminated by Associated pursuant to Section 8.01(a) (ix)(y), (ix)(z), or (x), (ii) a proposal for a Competing Transaction is received by the Company or any of its officers, directors or employees or any investment banker, financial advisor, attorney or other representative retained by the Company or any of the Company Subsidiaries or is offered, presented, proposed or announced to the Company, any of its officers, directors or employees or any investment banker, financial advisor, attorney or other representative retained by the Company or any of the Company Subsidiaries and thereafter this Agreement and the Merger are not approved by the Company’s shareholders and a Competing Transaction is consummated or a definitive agreement is entered into by the Company relating to a Competing Transaction within 18 months after the termination of this Agreement, or (iii) this Agreement is terminated by Associated pursuant to Section 8.01(a)(ii) or (xi), this Agreement is terminated by the Company otherwise than in accordance with its right to do so under Section 8.01 or the Company fails to consummate the Merger in breach of its obligations under this Agreement to do so and in each such case a proposal for a Competing Transaction was received by the Company or any of its officers, directors or employees or any investment banker, financial advisor, attorney or other representative retained by the Company or any of the Company Subsidiaries or was offered, presented, proposed or announced to the Company, any of its officers, directors or employees or any investment banker, financial advisor, attorney or other representative retained by the Company or any of the Company Subsidiaries or the Company’s shareholders on or prior to the date of such termination or breach, and a Competing Transaction is consummated or a definitive agreement is entered into by the Company relating to a Competing Transaction within 18 months after the termination of this Agreement, then in each such case Associated shall suffer direct and substantial damages, which damages cannot be determined with certainty, and to compensate Associated for such damages the Company shall pay Associated the amount of Twenty Million Dollars ($20,000,000). If such amount becomes payable, the Company shall make payment within two business days after termination of this Agreement in the case of the occurrence of any event described in clause (i) above and within two business days after a Competing Transaction is consummated or a definitive agreement is entered into by the Company relating to a Competing Transaction in the case of the occurrence of any event described in clause (ii) or (iii) above.
ARTICLE IX
(a) If to Associated:
Associated Banc-CorpAttention: Xxxxx X. Xxxxxxx, Chief Administrative Officer,
General Counsel & Corporate Secretary 0000 Xxxxxx Xxxx Xxxxx Xxx, XX 00000 Telecopier: (000) 000-0000With a copy to:
Xxxxxxxx Xxxxxxx Van Deuren s.c. Attention: Xxxxxxx X. Xxxxxx, Esq. 0000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000 Xxxxxxxxx, XX 00000 Telecopier: (000) 000-0000(b) If to Company:
First Federal Capital Corp Attention: Xxxx X. Xxxxx 000 Xxxxx Xxxxxx Xx Xxxxxx, XX 00000 Telecopier: (000) 000-0000with a copy to:
Xxxxxxx Xxxx & Friedrich LLP Attention: Xxxxx Xxxxxxx 000 Xxxx Xxxxxxxxx Xxxxxx, Xxxxx 0000 Xxxxxxxxx, XX 00000 Telecopier: (000) 000-0000 SECTION 9.04. Certain Definitions. For purposes of this Agreement, the term:(a) “affiliate” means a person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, the first mentioned person; including, without limitation, any partnership or joint venture in which the Company (either alone, or through or together with any other Company Subsidiaries) has, directly or indirectly, an interest of 5% or more;
(b) “beneficial owner” with respect to any Shares, means a person who shall be deemed to be the beneficial owner of such Shares (i) which such person or any of its affiliates or associates beneficially owns, directly or indirectly, (ii) which such person or any of its affiliates or associates (as such term defined in Rule 12b-2 of the Exchange Act) has, directly or indirectly, (A) the right to acquire (whether such right is exercisable immediately or subject only to the passage of time), pursuant to any agreement, arrangement, or understanding or upon the exercise of consideration rights, exchange rights, warranties, or options, or otherwise, or (B) the right to vote pursuant to any agreement, arrangement, or understanding, (iii) which are beneficially owned, directly or indirectly, by any other persons with whom such person or any of its affiliates or associates has any agreement, arrangement, or understanding for the purposes of requiring, holding, voting, or disposing of any Shares, or (iv) pursuant to Section 13(d) of the Exchange Act and any rules or regulations promulgated thereunder;
(c) “business day” means any day other than a day on which banks in Wisconsin are required or authorized to be closed;
(d) “control” (including the terms “controlled by” and “under common control with”) means the possession, directly or indirectly or as trustee or executor, of the power to direct or cause the direction of the management or policies of a person, whether through the ownership of stock or as trustee or executor, by contract or credit arrangement or otherwise;
(e) “knowledge” (and terms of similar import) with respect to a party means the actual knowledge of that party;
(f) “person” means an individual, corporation, partnership, association, trust, unincorporated organization, other entity, or group (as defined in Section 13(d) of the Exchange Act); and
(g) “subsidiary” means with respect to any person, (i) any corporation at least a majority of the outstanding voting stock of which is owned, directly or indirectly, by such person or by one or more of its subsidiaries, or by such person and one or more of its subsidiaries, (ii) any general partnership, joint venture, limited liability company, statutory trust, or other entity, at least a majority of the outstanding partnership, membership, or other similar interests of which shall at the time be owned by such person, or by one or more of its subsidiaries, or by such person and one or more of its subsidiaries, and (iii) any limited partnership of which such person or any of its subsidiaries is a general partner. For the purposes of this definition, “voting stock” means shares, interests, participations, or other equivalents in the equity interest (however designated) in such person having ordinary voting power for the election of a majority of the directors (or the equivalent) of such person, other than shares, interests, participations, or other equivalents having such power only by reason of the occurrence of a contingency.
(a) the potential loss of any tax deductions to the Company and/or Associated with respect to the deductibility of payments pursuant to the identified agreements; and
(b) any excise tax imposed on such disqualified individuals.
The provisions of this Section 9.05 shall survive the Effective Time indefinitely.
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ASSOCIATED BANC-CORP By: _________________________________________________________________ Name: Xxxx X. Xxxxxxxx Title: President and Chief Executive Officer FIRST FEDERAL CAPITAL CORP By: _________________________________________________________________ Name: Xxxx X. Xxxxx _________ Title: President and Chief Executive Officer