EXHIBIT 2.1
CONFIDENTIAL
AGREEMENT AND PLAN OF MERGER
BETWEEN
NORTHWEST SAVINGS BANK
AND
XXXXX SAVINGS BANK
Dated: June 19, 1997
TABLE OF CONTENTS
ARTICLE I.
THE MERGER.................................................... 1
1.1. The Merger............................................. 1
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1.2. Effective Time of the Merger........................... 2
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1.3 Closing................................................ 2
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1.4. Modification of Structure.............................. 2
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1.5. Stock Offering......................................... 2
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1.6. Formation of a "Mid-Tier" Stock Holding Company........ 3
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ARTICLE II.
EFFECT OF THE MERGER; CERTAIN ACTIONS IN CONNECTION THEREWITH. 3
2.1. Effect of the Merger................................... 3
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ARTICLE III.
REPRESENTATIONS AND WARRANTIES OF NORTHWEST................... 4
3.1. Corporate Organization................................. 4
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3.2. Authorization.......................................... 4
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3.3. No Violation........................................... 4
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3.4. Consents and Approvals................................. 5
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3.5. Information Supplied for Inclusion in the Corry Proxy.. 5
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Statement
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3.6. Northwest Information.................................. 5
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3.7. Accuracy of Information................................ 6
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3.8. Supplement to Northwest Disclosure Schedule............ 6
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3.9. Litigation............................................. 6
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ARTICLE IV.
REPRESENTATIONS AND WARRANTIES OF CORRY....................... 7
4.1. Corporate Organization................................. 7
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4.2. Capitalization......................................... 7
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4.3. Authorization.......................................... 7
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4.4. No Violation........................................... 8
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4.5. Reports and Financial Statements....................... 8
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4.6. Consents and Approvals................................. 9
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4.7. Absence of Certain Changes............................. 9
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4.8. Employee and Employee Benefits Matters................. 10
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4.9. Litigation............................................. 11
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4.10. Tax Matters............................................ 12
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4.11. Environmental Matters.................................. 12
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4.12. Compliance with Laws and Orders........................ 14
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4.13. Governmental Regulation................................ 14
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4.14. Contracts and Commitments.............................. 15
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4.15. Accuracy of Information................................ 15
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4.16. Supplement to Corry Disclosure Schedule................ 15
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4.17. Title to Assets; Leases................................ 15
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ARTICLE V.
COVENANTS OF NORTHWEST........................................ 16
5.1. Affirmative Covenants.................................. 16
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5.2. Negative Covenants..................................... 16
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5.3. Breaches............................................... 17
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5.4. Employee Benefit Plans; Employment Arrangements........ 17
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5.5. Filing of Applications................................. 19
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5.6. Supplement to Northwest Disclosure Schedule............ 19
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5.7. Confidentiality........................................ 19
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ARTICLE VI.
COVENANTS OF CORRY............................................ 19
6.1. Affirmative Covenants.................................. 19
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6.2. Negative Covenants..................................... 20
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6.3. Report to Northwest.................................... 22
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6.4. Breaches............................................... 22
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6.5. Supplement to Disclosure Schedule...................... 22
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6.6. Consents and Approvals................................. 22
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ARTICLE VII.
ADDITIONAL AGREEMENTS......................................... 23
7.1. Corry Depositors' Meeting.............................. 23
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7.2. Proxy Statement for Corry Depositors' Meeting.......... 23
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7.3. Cooperation: Regulatory Approvals...................... 23
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7.4. Brokers or Finders..................................... 23
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7.5. Additional Agreements: Reasonable Efforts.............. 23
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7.6. Release of Information................................. 24
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7.7. Advisory Directors..................................... 24
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7.8. Indemnification and Insurance Coverage................. 24
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7.9. Directors' Life Insurance.............................. 25
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7.10. Retention of Senior Officers........................... 25
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7.11. Access to Properties and Records: Confidentiality...... 25
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7.12 Charitable Foundation.................................. 26
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7.13. Certain Policies....................................... 26
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ARTICLE VIII.
CONDITIONS TO THE OBLIGATIONS OF NORTHWEST.................... 27
8.1. No Material Adverse Effect............................. 27
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8.2. Representations and Warranties......................... 27
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8.3. Performance and Compliance............................. 27
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8.4. No Proceeding or Litigation............................ 27
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8.5. Consents Under Agreements.............................. 27
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8.6. No Amendments to Resolutions........................... 28
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8.7. Certificate of Corry Officers.......................... 28
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8.8. Corporate Proceedings.................................. 28
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ARTICLE IX.
CONDITIONS TO THE OBLIGATIONS OF CORRY........................ 28
9.1. Representations and Warranties......................... 28
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9.2. Performance and Compliance............................. 29
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9.3. Corporate Proceedings.................................. 29
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9.4. Certificate of Northwest Officers...................... 29
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ARTICLE X.
CONDITIONS TO THE OBLIGATIONS OF ALL PARTIES.................. 29
10.1. Governmental Approvals................................. 29
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10.2. No Injunctions or Restraints........................... 30
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10.3. Corry Depositor Approval............................... 30
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10.4 Corporate Proceedings.................................. 30
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ARTICLE XI.
TERMINATION................................................... 30
11.1. Reasons for Termination................................ 30
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11.2. Effect of Termination.................................. 32
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ARTICLE XII.
MISCELLANEOUS................................................. 32
12.1. Nonsurvival of Representations, Warranties and
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Agreements............................................. 32
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12.2. Expenses............................................... 32
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12.3. Waivers: Amendments.................................... 32
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12.4. Assignment: Parties in Interest........................ 32
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12.5. Entire Agreement....................................... 33
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12.6. Captions and Counterparts.............................. 33
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12.7. Certain Definitions.................................... 33
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12.8. Governing Law.......................................... 33
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12.9. Notices................................................ 33
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SCHEDULES
Schedule 3.1
Schedule 4.4
Schedule 4.5
Schedule 4.6
Schedule 4.7
Schedule 4.8(a)
Schedule 4.8(b)
Schedule 4.9
Schedule 4.1 0
Schedule 4.11(a)
Schedule 4.11(b)
Schedule 4.11(c)
Schedule 4.11(d)
Schedule 4.11(e)
Schedule 4.11(f)
Schedule 4.12
Schedule 4.13
Schedule 4.14
Schedule 4.15
Schedule 4.16
Schedule 4.17
AGREEMENT AND PLAN OF MERGER
This Agreement and Plan of Merger, dated as of June 19, 1997 (the
"Agreement"), is entered into between Northwest Savings Bank ("Northwest"),
Northwest Bancorp, M.H.C. ("Bancorp MHC"), Northwest Bancorp, Inc. (the "Stock
Holding Company") and Xxxxx Savings Bank ("Corry").
R E C I T A L S:
- - - - - - - -
1. Northwest is a Pennsylvania-chartered stock savings bank
headquartered in Warren, Pennsylvania, approximately 69.3% of the issued and
outstanding capital stock of which is owned on the date hereof by Bancorp MHC, a
Pennsylvania-chartered mutual savings bank holding company; and
2. The Stock Holding Company is a Pennsylvania corporation that will
own 100% of the outstanding common stock of Northwest upon the completion of the
reorganization of Northwest and Bancorp MHC into a two-tier mutual holding
company.
3. Corry is a Pennsylvania-chartered mutual savings bank
headquartered in Corry, Pennsylvania; and
4. The parties desire to provide for Northwest's acquisition of
Corry pursuant to a merger (the "Merger") of Northwest and Corry on or after the
Effective Time (as defined in Section 1.2 hereof): and
5. It is intended that Corry will be merged into an interim
subsidiary of Northwest with Corry as the resulting institution, followed
immediately by a merger of Corry into Northwest, such that Northwest will be the
surviving institution as a result of the Merger.
In consideration of the premises and the mutual covenants,
representations, warranties, and agreements herein contained, and in order to
set forth the conditions upon which the Merger will be carried out, the parties,
intending to be legally bound, hereby agree as follows:
ARTICLE I.
THE MERGER
1.1. The Merger. Subject to the terms and conditions of this
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Agreement, and in accordance with the provisions of Section 18(c) of the Federal
Deposit Insurance Act (12 U.S.C. 1828(c)), as amended (the "Bank Merger Act"),
and the Chapter 16 of the Pennsylvania Banking Code of 1965 ("Banking Code"),
and the rules, regulations and policies promulgated under each of the Bank
Merger Act, the Federal Deposit Insurance Act, and the Banking Code (the
"Regulations"), at the Effective Time, Corry shall be merged with and into an
interim savings institution subsidiary of Northwest (the "Interim"), with Corry
as the surviving institution, followed immediately by the merger of Corry with
and into Northwest, with Northwest as the
surviving institution (the merger of Corry into Interim, and the subsequent
merger of Corry into Northwest, are collectively referred to as the "Merger"),
all pursuant to the terms and conditions set forth herein. Upon the consummation
of the Merger, the separate existence of Corry shall cease, and Northwest shall
continue as the surviving institution in the Merger.
1.2. Effective Time of the Merger. As soon as practicable after
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each of the conditions set forth in Articles VIII IX and X hereof have been
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satisfied or waived, Northwest and Corry will file, or cause to be filed,
articles of merger with the Pennsylvania Department of Banking ("Department")
for the Merger. The foregoing articles of merger shall in each case be in the
form required by and executed in accordance with the applicable provisions of
the Banking Code and the Regulations. The Merger shall become effective at the
time specified by the Pennsylvania Secretary of State in its endorsement of the
articles of merger (the "Effective Time").
1.3 Closing. If (a) the Agreement and the transactions
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contemplated hereby have been duly approved by the depositors of Corry and the
stockholders of Northwest, and (b) all relevant conditions of the Agreement have
been satisfied or waived, the closing (the "Closing") shall take place as
promptly as practicable thereafter at the executive offices of Northwest. At the
Closing, the parties hereto will exchange certificates, letters and other
documents as required hereby and will cause the filing described in Section 1.2
hereof with respect to the Merger to be made. Such Closing will take place
within five (5) business days of the satisfaction or waiver of all conditions
and/or obligations contained in Articles VIII, IX and X of this Agreement. The
date on which the Closing occurs is hereinafter referred to as the "Closing
Date."
1.4. Modification of Structure. Notwithstanding any provision of
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this Agreement to the contrary, Northwest may elect, subject to the filing of
all necessary applications and the receipt of all required regulatory approvals,
to modify the structure of the transactions contemplated hereby so long as (i)
there are no material adverse federal income tax consequences to Corry or the
depositors of Corry as a result of such modification, and (ii) such modification
will not be likely to materially delay or jeopardize receipt of any required
regulatory approvals or of the tax ruling or opinion required hereunder.
1.5. Stock Offering. In connection with the Merger, Corry and
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Northwest have adopted a Plan of Merger and Stock Issuance (the "Plan") setting
forth the terms and conditions pursuant to which Northwest, or the Stock Holding
Company which will own 100% of the common stock of Northwest upon completion of
the reorganization of Northwest into a two-tier mutual holding company
structure, shall offer for sale shares of Northwest or Stock Holding Company
common stock (the "Common Stock") to certain Corry depositors and tax-qualified
employee plans pursuant to rules of the FDIC and the Department (the "Stock
Offering"). As part of the Stock Offering, Corry shall obtain an independent
valuation (the "Valuation") of its pro forma market value assuming a merger with
Northwest. The number of shares of Common Stock sold shall be determined by
multiplying the Valuation by 30% (which percent may be increased by Northwest in
its sole discretion) and dividing the result by the lower of (i) the average of
the highest closing bid price of the Stock Holding Company Common Stock at the
close of trading of
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each of the twenty (20) trading days prior to the Effective Date and (ii) the
highest closing bid price of the Stock Holding Company Common Stock on the last
trading day prior to the completion of the Merger (the "Unadjusted Price Per
Share"). Northwest shall use its best efforts to obtain regulatory approval to
sell shares of Common Stock to Eligible Account Holders of Corry, as defined in
the Plan, at 90% of the Unadjusted Price Per Share (the "Adjusted Price Per
Share"). Corry depositors are not intended to be the beneficiary of any of the
provisions of this Agreement or this section 1.5, and nothing in this Agreement
shall be construed to give any rights whatsoever to depositors, which rights, if
any, shall only be granted pursuant to the Plan.
1.6. Formation of a "Mid-Tier" Stock Holding Company. Nothing in
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this Agreement shall prohibit Northwest and Bancorp MHC from reorganizing into a
mid-tier stock holding company structure (the "Mid-Tier Reorganization") by
establishing the Stock Holding Company that will become the owner of 100% of the
outstanding shares of common stock of Northwest by exchanging one share of its
common stock for each outstanding share of common stock.
ARTICLE II.
EFFECT OF THE MERGER; CERTAIN ACTIONS IN CONNECTION THEREWITH
2.1. Effect of the Merger.
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(a) Northwest, as the surviving institution in the Merger, shall
possess all of the properties and rights and shall be subject to all of the
liabilities and obligations of Corry, all as more fully described in the
Regulations. The name of Northwest, as the surviving institution in the Merger,
shall remain "Northwest Savings Bank."
(b) The Articles of Incorporation and Bylaws of Northwest, as in
effect immediately prior to the Effective Time, shall be the Articles of
Incorporation and Bylaws of Northwest, as the surviving institution of the
Merger.
(c) The directors and officers of Northwest immediately prior to the
Effective Time and the officers of Corry designated by Northwest shall be the
directors and officers of Northwest, as the surviving institution of the Merger,
and shall continue in office until their successors are duly elected or
otherwise duly selected.
(d) All deposit accounts of Corry existing immediately prior to the
Merger shall, upon consummation of the Merger, remain insured by the Federal
Deposit Insurance Corporation ("FDIC") to the fullest extent permitted by law
and regulation, and shall become deposit accounts in Northwest without change in
their respective terms, maturity, minimum required balances or withdrawal value
and with the same rights as other deposit accounts in Northwest.
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(e) As depositors of Northwest, all depositors of Corry as of the
Effective Time shall have the same rights in Bancorp MHC as other depositors of
Northwest, including any right to have priority subscription rights to purchase
additional shares of common stock that may be issued in connection with a
mutual-to-stock conversion of Bancorp MHC, or in any stock offering where
subscription rights are granted to depositors of Northwest.
ARTICLE III.
REPRESENTATIONS AND WARRANTIES OF NORTHWEST
Northwest hereby represents and warrants to Corry as follows:
3.1. Corporate Organization. Northwest is a stock savings bank
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duly organized and validly existing and in good standing under the laws of the
Commonwealth of Pennsylvania. Bancorp MHC is a mutual savings bank holding
company duly organized and validly existing and in good standing under the laws
of the Commonwealth of Pennsylvania. All eligible accounts issued by Northwest
are insured by the FDIC to the maximum extent permitted under applicable law.
Each of Northwest and Bancorp MHC has all requisite corporate power and
authority to own, operate and lease its properties as presently owned, operated
and leased and to engage in the activities and business now being conducted by
it. Schedule 3.1 to the Northwest disclosure schedule attached hereto as Annex I
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(the "Northwest Disclosure Schedule") lists each subsidiary of Bancorp MHC and
Northwest as of the date hereof (each "a Northwest Subsidiary," together, the
"Northwest Subsidiaries")
3.2. Authorization. The Board of Directors of Northwest and the
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Board of Trustees of Bancorp MHC (as majority stockholder of Northwest) have
approved the Agreement and the transactions contemplated hereby and have
authorized the execution, delivery and performance by Northwest of the
Agreement. Other than the approval by stockholders of Northwest, no other
corporate proceeding on the part of Northwest is necessary to authorize the
Agreement or to consummate the transactions contemplated thereby, and Northwest
has full corporate power and authority to enter into the Agreement and to
consummate the transactions contemplated hereby subject to the conditions set
forth in Articles VIII and X of this Agreement. This Agreement has been duly and
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validly executed and delivered by Northwest and Bancorp MHC and constitutes the
valid and binding obligation of Northwest and Bancorp MHC, enforceable against
them in accordance with its terms, subject to (a) all applicable bankruptcy,
insolvency, moratorium or other similar laws affecting the enforcement of
creditors' rights generally, and (b) the application of equitable principles if
equitable remedies are sought.
3.3. No Violation. Neither the execution and delivery of the
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Agreement nor, subject to the receipt of the consents and approvals contemplated
by Section 3.4, the consummation of the transactions contemplated herein will,
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(a) conflict with, result in the breach of, constitute a violation of,
constitute a default under or accelerate the performance of the terms of any
government regulation, judgment, order or decree of any court or other
governmental
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agency to which Northwest, Bancorp MHC or any of the Northwest Subsidiaries may
be subject, or any contract, agreement or instrument to which Northwest, Bancorp
MHC or any of the Northwest Subsidiaries is a party or by which Northwest,
Bancorp MHC or any of the Northwest Subsidiaries are bound or committed, or the
articles of incorporation of Northwest, Bancorp MHC, the charter of any
Northwest Subsidiary, or the bylaws of Northwest, Bancorp MHC or the Northwest
Subsidiaries, or, any law, or any rule or regulation of any governmental agency
or authority, or (b) constitute an event that with the lapse of time or action
by a third party could result in a default under any of the foregoing, or (c)
result in the creation of any lien, charge or encumbrance upon any of the assets
or properties of Northwest, Bancorp MHC or any Northwest Subsidiary.
3.4. Consents and Approvals. Other than the receipt of approvals
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required by the Banking Code, the Bank Merger Act, the Bank Holding Company Act
of 1956, as amended (the "BHCA") and the Regulations, no filing or registration
with, no notice to and no permit, authorization, consent or approval of the
depositors of Northwest or any public or governmental body or authority is
necessary for the consummation by Northwest of the transactions contemplated by
the Agreement. Northwest knows of no reason (including those relating to fair
lending laws or other laws relating to discrimination, including, without
limitation, the Equal Credit Opportunity Act, the Fair Housing Act, the
Community Reinvestment Act and the Home Mortgage Disclosure Act, and anti-trust
or consumer disclosure laws and regulations) why the regulatory approvals should
not be obtained.
3.5. Information Supplied for Inclusion in the Corry Proxy
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Statement. Any information regarding Northwest, Bancorp MHC or the Northwest
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Subsidiaries supplied by Northwest to Corry specifically for inclusion in the
Corry Proxy Statement (as defined in Section 7.2 hereof) will not contain any
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untrue statement of a material fact or omit to state a material fact necessary
to make the statements therein, in light of the circumstances in which they were
made, not misleading.
3.6. Northwest Information.
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(a) Northwest has previously delivered or made available to Corry
accurate and complete copies of the consolidated statements of financial
condition of Northwest as of June 30, 1996 and 1995, and the related
consolidated statements of income, stockholders' equity and cash flows for the
years ended June 30, 1996, 1995 and 1994, in each case accompanied by the audit
report of KPMG Peat Marwick LLP, independent public accountants with respect to
Northwest, and the unaudited consolidated statement of financial condition of
Northwest as of December 31, 1996 and the related unaudited consolidated
statements of income and cash flows for the six months ended December 31, 1996
and the unaudited consolidated statement of changes in stockholders' equity for
the six months ended December 31, 1996. The consolidated statements of financial
condition of Northwest referred to herein (including the related notes, where
applicable), as well as the consolidated statements of financial condition of
Northwest to be delivered pursuant to Section 4.04 hereof, fairly present or
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will fairly present, as the case may be,
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the consolidated financial condition of Northwest as of the respective dates set
forth therein, and the related consolidated statements of income, stockholders'
equity and cash flows (including the related notes, where applicable) fairly
present or will fairly present, as the case may be, the consolidated results of
operations, stockholders' equity and cash flows of Northwest for the respective
periods or as of the respective dates set forth therein.
(b) Each of the financial statements referred to in Section 3.6(a) has
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been or will be, as the case may be, prepared in accordance with generally
accepted accounting principles consistently applied during the periods involved.
The audits of Northwest and the Northwest Subsidiaries have been conducted in
accordance with generally accepted auditing standards. The books and records of
Northwest and the Subsidiaries are being maintained in material compliance with
applicable legal and accounting requirements, and such books and records
accurately reflect in all material respects all dealings and transactions
regarding the business, assets, liabilities and affairs of Northwest and the
Northwest Subsidiaries.
(c) As of December 31, 1996, except and to the extent (i) reflected,
disclosed or provided for in the financial statements referred to above and (ii)
of liabilities incurred since December 31, 1996 in the ordinary course of
business and consistent with prudent banking practice, neither Northwest nor any
Northwest Subsidiary has any liabilities, whether absolute, accrued, contingent
or otherwise, material to the business, operations, assets or financial
condition of Northwest and its subsidiaries taken as a whole.
3.7. Accuracy of Information. The statements made by Northwest in
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the Agreement and in any other written documents executed and/or delivered by or
on behalf of Northwest pursuant to the terms of the Agreement are true and
correct in all material respects.
3.8. Supplement to Northwest Disclosure Schedule. Northwest will
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promptly supplement or amend the Northwest Disclosure Schedule with respect to
any matter hereafter arising that, if existing or occurring at the date of this
Agreement, would have been required to be set forth or described in the
Northwest Disclosure Schedule. No supplement or amendment to the Northwest
Disclosure Schedule will have any effect for the purpose of determining
satisfaction of the condition set forth in Section 9.1 hereof.
3.9. Litigation. No claims have been asserted and no relief has
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been sought against Bancorp MHC, Northwest or any Northwest Subsidiary in any
pending litigation or governmental proceedings or otherwise which would be
reasonably likely to result in Northwest becoming unable to perform its
obligations under, and consummate the transactions contemplated by, this
Agreement.
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ARTICLE IV.
REPRESENTATIONS AND WARRANTIES OF XXXXX
Xxxxx hereby represents and warrants to Northwest as follows:
4.1. Corporate Organization.
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(a) Corry has all requisite corporate power and authority to own,
operate and lease its properties as presently owned, operated or leased and to
engage in the activities and business now conducted by it. Corry is qualified to
do business in each jurisdiction in which the nature of business conducted or
assets owned or leased by it makes such qualification necessary and where a
failure to do so would have a Material Adverse Effect. All eligible accounts
issued by Corry are insured by the FDIC to the maximum extent permitted under
applicable law. Corry is a "domestic building and loan association" as defined
in the Internal Revenue Code of 1986, as amended (the "Code"). Corry is a
savings bank duly organized, validly existing and in good standing under the
laws of the Commonwealth of Pennsylvania. Corry does not own, control or have an
ownership interest in any other corporation or business.
(b) Corry has heretofore delivered to Northwest true and complete
copies of the articles of incorporation, organization certificate or other
chartering instrument and bylaws of Corry in effect on the date hereof. The
minute books of Corry contain accurate minutes of all meetings and accurate
consents in lieu of meetings of the Board of Trustees (and any committee
thereof) of Corry recorded therein, and as of the Effective Time such minute
books will contain accurate minutes of all such meetings and such consents in
lieu of meetings respectively held or executed prior thereto. The minute books
accurately reflect all transactions referred to in such minutes and consents in
lieu of meetings and disclose all material corporate actions of the Board of
Trustees of Corry and all committees thereof. Except as reflected in such minute
books, there are no minutes of meetings or consents in lieu of meetings of the
Board of Trustees (or any committee thereof) of Corry.
4.2. Capitalization. As of the date hereof, Corry is a mutual
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savings bank and has no authorized shares of capital stock whatsoever.
4.3. Authorization. The Board of Trustees of Corry has approved
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the Agreement and the transactions contemplated thereby and authorized the
execution, delivery and performance by Corry of the Agreement. No other
corporate proceeding on the part of Corry is necessary to authorize the
Agreement or to consummate the transactions contemplated thereby other than the
approval of the depositors of Corry as provided in Section 7.1 hereof. Corry has
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full corporate power and authority to enter into the Agreement and, upon
approval of the depositors of Corry in accordance with law and subject to the
additional conditions set forth in Articles IX and X of this Agreement, to
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consummate the transactions contemplated hereby. This Agreement has been duly
and validly executed and delivered by Corry and constitutes the valid and
binding obligations
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of Corry, enforceable against it in accordance with its terms, subject to (a)
all applicable bankruptcy, insolvency, moratorium, or other similar laws
affecting the enforcement of creditors' rights generally or the rights of
creditors of savings associations the accounts of which are insured by the FDIC,
(b) the application of equitable principles if equitable remedies are sought,
and (c) the provisions of this Agreement providing that the Merger will be
enforceable only upon approval by the depositors of Corry as described in
Section 7.1 hereof.
4.4. No Violation. Other than as set forth in Schedule 4.4 of the
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Corry Disclosure Schedule attached hereto as Annex II (the "Corry Disclosure
Schedule"), neither the execution and delivery of this Agreement nor, subject to
the receipt of the consents and approvals contemplated by Section 4.6, the
consummation of the transactions contemplated herein will (a) conflict with,
result in the breach of, constitute a default under or accelerate the
performance provided by the terms of any judgment, order or decree of any court
or other governmental agency to which Xxxxx xxx be subject, or any contract,
agreement or instrument to which Corry is a party or by which Corry is bound or
committed, or the charter or the bylaws of Corry, or, to the knowledge of Corry
(as defined in Section 12.7(e) hereof), any law, or any rule or regulation of
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any governmental agency or authority, or (b) constitute an event that with the
lapse of time or action by a third party, or both, could result in a default
under any of the foregoing or (c) result in the creation of any material lien,
charge or encumbrance upon any of the assets or properties of Corry.
4.5. Reports and Financial Statements. Corry has previously
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furnished Northwest with true and complete copies of its (a) Audited Balance
Sheet as the years ended December 31, 1996 and 1995, and the related Statements
of Income, Retained Earnings and Cash Flows for the years ended December 31,
1996, 1995, and 1994, and (b) all other reports or registration statements filed
by Corry with the FDIC or the Department since December 31, 1996 (including call
reports). The audited consolidated financial statements and unaudited interim
financial statements of Corry included in such reports or otherwise delivered to
Northwest (collectively referred to herein as the "Corry Financial Statements")
have been prepared in accordance with generally accepted accounting principles
applied on a consistent basis (except as may be indicated therein or in the
notes thereto) and fairly present the financial position of Corry as of the
dates thereof and the results of its operations and changes in financial
position for the periods then ended, subject, in the case of the unaudited
interim financial statements, to normal year-end audit adjustments, any other
adjustments described therein, and the absence of certain footnotes. Except as
set forth in Schedule 4.5 to the Corry Disclosure Schedule, since December 31,
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1996 Corry has not suffered a Material Adverse Effect and Corry is not aware of
any event or circumstance, or series of events and circumstances, which is
reasonably likely to result in a Material Adverse Effect to Corry. The books and
records of Corry have been, and are being, maintained in accordance with
applicable legal and accounting requirements and reflect only actual
transactions. As of December 31, 1996, except and to the extent (i) reflected,
disclosed or provided for in the financial statements referred to above and (ii)
of liabilities incurred since December 31, 1996 in the ordinary course of
business and consistent with prudent banking practice, Corry does not have
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any liabilities, whether absolute, accrued, contingent or otherwise, material to
the business, operations, assets or financial condition of Corry
4.6. Consents and Approvals. Other than as set forth in Schedule
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4.6 to the Corry Disclosure Schedule and other than the receipt of approvals
---
required by the Banking Code, the Bank Merger Act, the Regulations, and any
required approval of the Corry depositors as described in Section 7.1 hereof, no
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filing or registration with, no notice to and no permit, authorization, consent
or approval of any third party or any public or governmental body or authority
is necessary for the consummation by Corry of the transactions contemplated by
this Agreement or to enable Northwest to continue to conduct the business of
Corry after the Effective Time in a manner which is consistent with that in
which it is presently conducted, except where the failure to make such filing or
obtain such permit, authorization, consent or approval will not in the aggregate
have a Material Adverse Effect.
4.7. Absence of Certain Changes. Since December 31, 1996, and
--------------------------
except as otherwise permitted by this Agreement, Corry has not, except as set
forth in Schedule 4.7 to the Corry Disclosure Schedule, (a) incurred any
------------
material obligation or liability (absolute or contingent), except obligations or
liabilities incurred in the ordinary course of business in accordance with past
practices; (b) mortgaged, pledged or subjected to lien or encumbrance (other
than statutory liens for taxes not yet delinquent and landlord liens) any of its
material assets or properties except pledges to secure government deposits and
in connection with repurchase or reverse repurchase agreements; (c) discharged
or satisfied any material lien or encumbrance or paid any obligation or
liability (absolute or contingent), other than current liabilities included in
Xxxxx'x balance sheet as of December 31, 1996, and current liabilities incurred
since the date thereof in the ordinary course of business in accordance with
past practices; (d) sold, exchanged or otherwise disposed of any of its material
capital assets other than in the ordinary course of business in accordance with
past practices; (e) materially made or modified any wage or salary increase
other than routine periodic increases in salary for employees in the ordinary
course of business and in accordance with past practices or as required by law,
entered into or modified any employment contract with any officer or salaried
employee or instituted any employee welfare, bonus, stock option, profit
sharing, retirement or similar plan or arrangement; (f) suffered any damage,
destruction or loss, whether or not covered by insurance, materially and
adversely affecting its business, property or assets or waived any rights of
value that are material in the aggregate, considering its business taken as a
whole; (g) except in the ordinary course of business in accordance with past
practices, entered, or agreed to enter, into any agreement or arrangement
granting any preferential right to purchase any of its assets, properties or
rights or requiring the consent of any party to the transfer and assignment of
any such assets, properties or rights; (h) entered into any material transaction
outside the ordinary course of its business in accordance with past practices,
except as expressly contemplated by the Agreement or (i) except in the ordinary
course of business in accordance with past practices or as reflected in the
Corry Financial Statements, sold or otherwise disposed of any of its material
investment securities.
9
4.8. Employee and Employee Benefits Matters. (a) Schedule 4.8(a)
-------------------------------------- ---------------
to the Corry Disclosure Schedule lists (i) each pension, profit sharing, bonus,
thrift, savings program or arrangement, which constitutes an "employee pension
plan" within the meaning of Section 3(2) of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA"), which is maintained by Corry or to
which Corry contributes for the benefit of any current or former employee,
officer, trustee, consultant or agent; (ii) each plan, program or arrangement
for the provision of medical, surgical, or hospital care or benefits, benefits
in the event of sickness, accident, disability, death, unemployment, severance,
vacation, apprenticeship, day care, scholarship, prepaid legal services or other
benefits which constitute an "employee welfare benefit plan" within the meaning
of Section 3(1) of ERISA, which is maintained by Corry to which Corry
contributes for the benefit of any current or former employee, officer, trustee,
consultant or agent; and (iii) every other retirement or deferred compensation
plan, bonus or incentive compensation plan or arrangement, severance or vacation
pay arrangement, or other fringe benefit plan, program or arrangement through
which Corry provides benefits for or on behalf of any current or former
employee, officer, trustee, consultant or agent. Corry has delivered or made
available to Northwest a true and correct copy of (a) each Corry Benefit Plan,
(b) the most recent annual report (Form 5500) filed with the Internal Revenue
Service ("IRS") with respect to each Corry Benefit Plan, if applicable, (c) each
trust agreement and group annuity contract, if any, relating to such Corry
Benefit Plan, (d) the most recent actuarial report or valuation relating to a
Corry Benefit Plan subject to Title IV of ERISA and (e) all rulings and
determination letters and any open requests for rulings or letters that pertain
to any Corry Benefit Plan.
(b) All of the plans, programs and arrangements described in this
Section 4.8 or listed in Schedule 4.8(a) to the Corry Disclosure Schedule
----------- ---------------
(hereinafter referred to as the "Corry Benefit Plans") that are subject to ERISA
and the Internal Revenue Code ("Code") are in material compliance with all
applicable requirements of ERISA and the Code and all other applicable federal
and state laws, including, without limitation, the reporting and disclosure
requirements of Part I of Title I of ERISA. Each of the Corry Benefit Plans that
is intended to be a pension, profit sharing, thrift, or savings plan that is
qualified under Section 401(a) of the Code satisfies the applicable requirements
of such provision and there exist no circumstances that would adversely affect
the qualified status of any such Plan under that section, except with respect to
any required retroactive amendment for which the remedial amendment period has
not yet expired. Except as set forth in Schedule 4.8(b) to the Corry Disclosure
---------------
Schedule, there is no pending or, to the knowledge of Corry, threatened
litigation, claim, action, governmental proceeding or investigation against or
relating to any Corry Benefit Plan which could give rise to any material
liability, and there is no reasonable basis for any material litigation, claims,
actions or proceedings against any such Corry Benefit Plan. No Corry Benefit
Plan (or Corry Benefit Plan fiduciary) has engaged in a non-exempt "Prohibited
Transaction" (as defined in Section 406 of ERISA and Section 4975(c) of the
Code) since the date on which said sections became applicable to such Plan.
There have been no acts or omissions by Corry that have given rise to any fines,
penalties, taxes or related charges under Sections 502(c), 502(i) or 4071 of
ERISA or Chapter 43 of the Code, or that may give rise to any material fines,
penalties, taxes or related damages under such laws for which Xxxxx xxx be
liable. Corry has no knowledge of, or any reasonable basis to believe, that any
10
material liability under Title IV of ERISA has been incurred by Corry, any
former Affiliates of Corry or the Corry Benefit Plans since the effective date
of ERISA that has not been satisfied in full, and that any condition exists that
presents a material risk of incurring a liability under such Title, other than
liability for premiums due the Pension Benefit Guaranty Corporation ("PBGC"),
which payments have been made or will be made when due. With respect to each of
the Corry Benefit Plans which is subject to Title IV of ERISA, the present value
of accrued benefits under such Plan or Plans, based upon the actuarial
assumptions used for funding purposes in the most recent actuarial report
prepared by such Plan's actuary with respect to such Plan, did not, as of its
latest valuation date, exceed the then current value of the assets of such Plan
allocable to such accrued benefits and Corry is not aware of any facts or
circumstances that would materially change the funded status of any such ERISA
Plan. Other than as set forth in Schedule 4.8(a), none of the Corry Benefit
Plans is a "multiemployer pension plan" as such term is defined in section 3(37)
of ERISA. Except as listed on Schedule 4.8(b) of the Corry Disclosure Schedule,
no employee of Corry will be entitled to any additional benefits or any
acceleration of the time of payment or vesting of any benefits under any Corry
Benefit Plan as a result of the transactions contemplated by this Agreement.
Other than current or contingent liabilities previously disclosed on Schedule
4.8(b) of the Corry Disclosure Schedule, neither Corry nor any Corry Benefit
Plan will have any material current or contingent liability with respect to any
Plan. All group health plans of Corry, including any plans of current and former
Affiliates of Corry that must be taken into account under Section 4980B of the
Code or Section 601 of ERISA or the requirements of any similar state law
regarding insurance continuation, have been operated in material compliance with
the group health plan continuation coverage requirements of Section 4980B of the
Code and Section 601 of ERISA to the extent such requirements are applicable.
All payments due from any Corry Benefit Plan (or from Corry with respect to any
Corry Benefit Plan) have been made, and all amounts properly accrued to date as
liabilities of Corry that have not yet been paid have been properly recorded on
the books of Corry.
(c) No amounts payable under the Corry Benefit Plans, or any
employment, severance or termination agreement between Corry and any employee or
officer will fail to be deductible for federal income tax purposes by virtue of
section 280G of the Code.
4.9. Litigation. Except as set forth in Schedule 4.9 to the Corry
---------- ------------
Disclosure Schedule, no claims have been asserted and no relief has been sought
against Corry in any pending litigation or governmental proceedings or otherwise
which would be reasonably expected to result in damages or other relief which
would be reasonably likely to have a Material Adverse Effect. To the knowledge
of Corry, there are no circumstances, conditions, events or arrangements,
contractual or otherwise, which may hereafter give rise to any proceedings,
claims, actions or government investigations involving Corry which would
reasonably be expected to result in damages or other relief which would be
reasonably likely to have a Material Adverse Effect, nor are any such
proceedings, claims, actions or government investigations threatened. Except as
set forth in Schedule 4.9 to the Corry Disclosure Schedule, Corry is not a party
------------
to any order, judgment or decree which would reasonably be expected to have a
Material Adverse Effect, and Corry (a) is not the subject of any cease and
desist order, or other formal or informal enforcement
11
action by any regulatory authority and (b) has not made any commitment to or
entered into any agreement with any regulatory authority that restricts or
adversely affects its operations or financial condition.
4.10. Tax Matters. Corry has timely filed (inclusive of applicable
-----------
extension periods) with the appropriate governmental agencies all material
federal, state and local income, franchise, excise, sales, use, real and
personal property and other tax returns and reports (including information
returns and reports) that are required to be filed, and Corry is not materially
delinquent in the payment of any taxes shown on such returns or reports or on
any assessments for any such taxes received by Corry. There are included in the
Corry Financial Statements adequate reserves for the payment of all accrued but
unpaid material federal, state and local taxes of Corry, including interest and
penalties, whether or not disputed for such fiscal years as reflected therein
and all fiscal years prior thereto. Corry has not executed or filed with the
Internal Revenue Service ("IRS") or any state tax authority any agreement
extending the period for assessment and collection of any federal or state tax,
nor is Corry a party to any action or proceeding by any governmental authority
for assessment or collection of taxes. There is no outstanding material
assessment or claim for collection of taxes against Corry. Except as set forth
in Schedule 4.10 to the Corry Disclosure Schedule, the federal income tax
-------------
returns of Corry have been audited by the IRS (or are closed to examination due
to the expiration of the applicable statute of limitations) and no deficiencies
were asserted as a result of such audit which have not been resolved and paid in
full or adequate reserves or accruals established in accordance with generally
accepted accounting principles with respect thereto.
Corry has not, during the past five (5) years, except as disclosed in
Schedule 4.10 to the Corry Disclosure Schedule, received any notice of
-------------
deficiency, proposed deficiency or assessment from the IRS or any other
governmental agency, with respect to any federal, state, county or local taxes.
No federal or state tax return of Corry is currently the subject of any audit by
the IRS or any other governmental agency. During the past five (5) years, no
material deficiencies have been asserted in connection with the federal and
state income tax returns of Corry and Corry has no reason to believe that any
material deficiency would be asserted relating thereto. Except as disclosed in
Schedule 4.10 to the Corry Disclosure Schedule, Corry is not a party to any
-------------
agreement providing for allocation or sharing of taxes. Corry has never been a
member of an "affiliated group of corporations" (within the meaning of Section
1504(a) of the Code) filing consolidated returns, other than the affiliated
group of which Corry is or Corry was the common parent.
4.11. Environmental Matters. For purposes of this Section 4.11,
--------------------- ------------
the following terms shall have the indicated meaning:
"Environmental Law" means any federal, state or local law, statute,
ordinance, rule, regulation, code, license, permit, authorization, approval,
consent, order, judgment, decree, injunction or agreement with any governmental
entity relating to (1) the protection, preservation or restoration of the
environment (including, without limitation, air, water vapor, surface water,
12
groundwater, drinking water supply, surface soil, subsurface soil, plant and
animal life or any other natural resource), and/or (2) the use, storage,
recycling, treatment, generation, transportation, processing, handling,
labeling, production, release or disposal of Materials of Environmental Concern.
The term Environmental Law includes without limitation (1) the Comprehensive
Environmental Response, Compensation and Liability Act, as amended, 42 U.S.C.
(S)9601, et seq; the Resource Conservation and Recovery Act, as amended, 42
-- ---
U.S.C. (S)6901, et seq; the Clean Air Act, as amended, 42 U.S.C. (S)7401, et
-- --- --
seq; the Federal Water Pollution Control Act, as amended, 33 U.S.C. (S)1251, et
--- --
seq; the Toxic Substances Control Act, as amended, 15 U.S.C. (S)9601, et seq;
--- -- ---
the Emergency Planning and Community Right to Know Act, 42 U.S.C. (S)11001, et
--
seq; the Safe Drinking Xxxxx Xxx, 00 X.X.X. (X)000x, et seq; and all comparable
--- -- ---
state and local laws, and (2) any common law (including without limitation
common law that may impose strict liability) that may impose liability or
obligations for injuries or damages due to, or threatened as a result of, the
presence of or exposure to any Materials of Environmental Concern.
"Environmental Claim" means any written notice from any governmental
authority or third party alleging potential liability (including, without
limitation, potential liability for investigatory costs, cleanup costs,
governmental response costs, natural resources damages, property damages,
personal injuries or penalties) arising out of, based on, or resulting from the
presence, or release into the environment, of any Materials of Environmental
Concern.
"Materials of Environmental Concern" means pollutants, contaminants,
wastes, toxic substances, petroleum and petroleum products and any other
materials regulated under Environmental Laws.
"Loan Portfolio Properties and Other Properties Owned" means those
properties owned, leased or operated by Corry, including those properties
serving as collateral for any loans made and retained by Corry or for which
Corry serves in a trust relationship for the loans retained in portfolio.
(a) Other than as set forth on Schedule 4.11(a) to the Corry
----------------
Disclosure Schedule, to the knowledge of Corry it is in compliance with all
Environmental Laws, except for any violations of any Environmental Law which
would not, singly or in the aggregate, have a material adverse effect on the
business, operations, assets, financial condition or prospects of Corry. Other
than as set forth on Schedule 4.12 to the Corry Disclosure Schedule, since June
-------------
30, 1990, Corry has not received any communication alleging that Corry is not in
such compliance and, to the knowledge of Corry, there are no present
circumstances that would prevent or interfere with the continuation of such
compliance.
(b) Other than as set forth on Schedule 4.11(b) to the Corry
----------------
Disclosure Schedule, to the knowledge of Corry, it has not been or is in
violation of or liable under any Environmental Law, except any such violations
or liabilities which would not singly or in the aggregate have a material
adverse effect on the business, operations, assets or financial condition of
Corry.
13
(c) Other than as set forth on Schedule 4.11(c) to the Corry
Disclosure Schedule, to the knowledge of Corry, none of the Loan Portfolio
Properties and Other Properties Owned by it has been or is in violation of or
liable under any Environmental Law, except any such violations or liabilities
which singly or in the aggregate would not have a material adverse effect on the
business, operations, assets or financial condition of Corry.
(d) Other than as set forth on Schedule 4.11(d) to the Corry
----------------
Disclosure Schedule, to the knowledge of Corry, there are no actions, suits,
demands, notices, claims, investigations or proceedings pending or threatened
relating to the liability of the Loan Portfolio Properties and Other Properties
Owned by Corry under any Environmental Law, including without limitation any
notices, demand letters or requests for information from any federal or state
environmental agency relating to any such liabilities under or violations of
Environmental Law, except such which would not have or result in a material
adverse effect on the business, operations, assets or financial condition of
Corry.
(e) Other than as set forth on Schedule 4.11(e) to the Corry
----------------
Disclosure Schedule, to the knowledge of Corry, there are no past or present
actions, activities, circumstances, conditions, events or incidents that could
reasonably form the basis of any Environmental Claim or other claim or action or
governmental investigation that could result in the imposition of any liability
arising under any Environmental Law against Corry or against any person or
entity whose liability for any Environmental Claim Corry has or may have
retained or assumed either contractually or by operation of law, except such
which would not have a material adverse effect on the business, operations,
assets, financial condition or prospects of Corry.
(f) Corry has set forth on Schedule 4.11(f) to the Corry Disclosure
----------------
Schedule, any environmental studies conducted by it during the past five years
with respect to any properties owned by it as of the date hereof.
4.12. Compliance with Laws and Orders. Except as set forth in
-------------------------------
Schedule 4.12 to the Corry Disclosure Schedule, Corry has not received notice of
-------------
any violation or alleged material violation of, or, to the knowledge of Corry,
is subject to any liability (whether accrued, absolute, contingent, direct or
indirect) for past or continuing material violations of, any law, statute or
regulation. Corry is not in default under, and no event has occurred that, with
the lapse of time or action by a third party or both, could result in a default
under the terms of any judgment, decree, order, writ, rule or regulation of any
governmental authority or court, whether federal, state or local and whether at
law or in equity, where the failure to be in full compliance would reasonably be
expected to result alone or in the aggregate in damages, which would be
reasonably likely to have a Material Adverse Effect.
4.13. Governmental Regulation. Corry holds all material licenses,
-----------------------
certificates, permits, franchises and rights from all appropriate federal, state
and other public authorities necessary for the conduct of its business; and,
between the date hereof and the Closing Date, Corry will use its best efforts to
maintain all such licenses, certificates, permits, franchises and
14
rights in effect. Except as set forth in Schedule 4.13 to the Corry Disclosure
-------------
Schedule, Corry is not a party or subject to any agreements, directives, orders
or similar arrangements between or involving Corry and any federal savings
institution regulatory authority.
4.14. Contracts and Commitments. Except as set forth in Schedule
------------------------- --------
4.14 to the Corry Disclosure Schedule, Corry is not a party to or bound by any
----
(a) material lease or license with respect to any property, real or personal;
(b) material contract or commitment for capital expenditures; (c) material
contract or commitment for total expenses for the purchase of materials,
supplies or for the performance of services by third parties for a period of
more than 60 days from the date of this Agreement; (d) material contract or
option for the purchase or sale of any real or personal property other than in
the ordinary course of business; or (e) agreement, arrangement or understanding
relating to the employment, election, retention in office or severance of any
present or former trustee, officer or employee of Corry. To its knowledge, Corry
has performed in all material respects all obligations required to be performed
by them to date and are not in default under, and no event has occurred which,
with the lapse of time or action by a third party or both, could result in a
default resulting in material damages or other material default under any
outstanding mortgage, lease, contract, commitment or agreement to which Corry is
a party or by which Corry is bound or under any provision of its charters or
bylaws. Each such outstanding material mortgage, lease, contract, commitment or
agreement is a valid and legally binding obligation of Corry subject to (x) all
applicable bankruptcy, insolvency, moratorium or other similar laws affecting
the enforcement of creditors rights generally or the rights of creditors of
savings associations the accounts of which are insured by the FDIC, and (y) the
application of equitable principles if equitable remedies are sought.
4.15. Accuracy of Information. The statements made by Corry in the
-----------------------
Agreement and in any other written documents executed and/or delivered by or on
behalf of Corry pursuant to the terms of the Agreement are true and correct in
all material respects. The statements contained in such other documents or
specifically referred to in the Agreement will be deemed to constitute
representations and warranties of Corry under this Agreement to the same extent
as if set forth herein in full.
4.16. Supplement to Corry Disclosure Schedule. Corry will promptly
---------------------------------------
supplement or amend the Corry Disclosure Schedule with respect to any matter
hereafter arising that, if existing or occurring at the date of this Agreement,
would have been required to be set forth or described in the Corry Disclosure
Schedule. No supplement or amendment to the Corry Disclosure Schedule will have
any effect for the purpose of determining satisfaction of the condition set
forth in Section 8.2 hereof.
-----------
4.17. Title to Assets; Leases
-----------------------
(a) Except for (i) liens and encumbrances specifically disclosed in
any of the consolidated financial statements of Corry referred to in Section 4.5
-----------
hereof, (ii) landlords' or statutory liens or other liens incurred in the
ordinary course of business and not securing
15
indebtedness for borrowed money and not yet delinquent, and (iii) liens and
encumbrances which are not material in amount and do not materially impair the
value of any property subject thereto or the use of such property for the
purposes for which it is presently used or intended to be used, Corry has good
and marketable title, free and clear of all security interests, encumbrances,
trust agreements, liens or other adverse claims, to all its assets and property,
real and personal, reflected in the financial statements referred to in Section
4.5 hereof or acquired thereafter, which includes all property and assets used
by Corry that are material to the conduct of its businesses, except for assets
and property disposed of in the ordinary course of business after December 31,
1996.
(b) Corry, as lessee, has the right under valid and subsisting leases
to occupy, use, possess and control all property leased by it in all material
respects as presently occupied, used, possessed and controlled by Corry and such
leases will not terminate or lapse prior to the Effective Time or be affected in
any material respect by consummation of the transactions contemplated hereby.
Schedule 4.17 contains an accurate listing of each lease pursuant to which Corry
-------------
acts as lessor or lessee, including the expiration date and the terms of any
renewal options which relate to the same, as well as a listing of each material
real property owned by Corry and used in the conduct of its business.
(c) All material real and personal property owned by Corry or
presently used by it are in an adequate condition (ordinary wear and tear
excepted) and are sufficient to carry on the business of Corry.
ARTICLE V.
COVENANTS OF NORTHWEST
Northwest hereby agrees that from the date of this Agreement until the
Effective Time:
5.1. Affirmative Covenants.
---------------------
(a) Unless the prior written consent of Corry shall have been obtained
(which shall not be unreasonably withheld), Northwest will maintain and will
cause each of its Subsidiaries to maintain their corporate existence in good
standing so as to be able to consummate the transactions contemplated by the
Agreement.
(b) As soon as reasonably practicable, xxxxxxx Xxxxx with copies of
all of Northwest's periodic reports filed with the Department or FDIC subsequent
to the date hereof.
5.2. Negative Covenants. Except as specifically contemplated by
------------------
this Agreement, Northwest shall not do, or agree or commit to do, or permit any
of the Northwest Subsidiaries to
16
do, without the prior written consent of Corry (which shall not be unreasonably
withheld), any of the following:
(a) willfully take action which would or is reasonably likely to (i)
adversely affect the ability of either Northwest or Corry to obtain any
necessary approvals of governmental authorities required for the transactions
contemplated hereby; (ii) adversely affect Northwest's ability to perform its
covenants and agreements under this Agreement; or (iii) result in any of the
conditions to the Merger set forth in Articles IX and X not being satisfied; or
----------- -
(b) agree in writing or otherwise to do any of the foregoing.
5.3. Breaches. Northwest shall, in the event it becomes aware of
--------
the impending or threatened occurrence of any event or condition which would
cause or constitute a material breach (or would have caused or constituted a
breach had such event occurred or been known prior to the date hereof) of any of
its representations or agreements contained or referred to herein, give prompt
written notice thereof to Corry and use its best efforts to prevent or promptly
remedy the same.
5.4. Employee Benefit Plans; Employment Arrangements
-----------------------------------------------
(a) Northwest shall offer continued employment to all employees of
Corry as of the Effective Time at the salary levels in effect at the Effective
Time, subject to the provisions in this Section 5.4. Employees of Corry who
-----------
continue employment with Northwest on or after the Effective Time (all such
persons referred to herein as "Continuing Employees") shall be eligible to
participate in such employee benefit plans as may be in effect generally for
employees of Northwest from time to time (the "Northwest Plans"), if such
Continuing Employee shall be eligible for participation therein. Except as
specifically set forth in this Section 5.4, Continuing Employees shall be
-----------
entitled to participate on the same basis as similarly situated employees of
Northwest, except that Continuing Employees shall be entitled to full credit for
each year of service (in which 1,000 hours of service are performed) with Corry
for purposes of determining eligibility for participation and vesting, but not
for benefit accruals, in the Northwest Plans, subject to applicable break in
service rules. The officers and trustees of Corry shall be permitted to
participate in the Northwest Savings Bank and Northwest Bancorp, MHC Recognition
and Retention Plan (the "Restricted Stock Plan"), and the Northwest Savings Bank
and Northwest Bancorp, MHC Stock Option Plan (the "Option Plan"). The Board of
Trustees of Corry shall designate officers and trustees who shall receive in the
aggregate (i) a number of shares of Northwest common stock, restricted by the
terms of the Restricted Stock Plan, equal to 4% of the number of shares of
common stock sold in the Stock Offering, and (ii) pursuant to the Option Plan
options to purchase a number of shares of Northwest common stock equal to 10% of
the number of shares of Common Stock sold in the Stock Offering, at an exercise
price equal to the fair market value of the Northwest common stock at the time
the options are awarded. If sufficient shares or options to satisfy the awards
set forth above under (i) and (ii) are not then available under such plans, Bank
and Bancorp MHC shall use their best efforts to amend such plans, or to adopt an
17
additional restricted stock plan and stock option plan, to permit such awards to
be made. Any additional restricted stock or stock option plans shall be
established in accordance with rules and policy of the Department and the FDIC.
In addition, Northwest's ESOP or other tax qualified employee plans shall
purchase up to 10% of the shares of Common Stock sold in the Stock Offering and
Continuing Employees shall not be entitled to credit for prior service with
Corry for any purpose but shall be eligible for participation in the tax-
qualified employee plans on the same basis as new employees of Northwest.
Notwithstanding anything in this Section 5.4(a) to the contrary, participation
--------------
by Continuing Employees in employee benefit plans of Northwest with respect to
which eligibility and participation is at the discretion of the employer, such
as non-qualified deferred compensation plans, and other such similar plans (but
not including employee benefit plans generally available to all full-time
employees of Northwest) shall be discretionary with such employer. Furthermore,
notwithstanding anything in this Agreement to the contrary, Northwest reserves
the right following the Effective Time to terminate any benefit plan maintained
by Corry as of the Effective Time or to merge any such benefit plans with the
Northwest plans. Nothing in this Section 5.4 shall be construed to establish an
employment contract relationship between Northwest and any Corry employee except
with respect to any agreement listed in Schedule 4.14 of the Corry Disclosure
-------------
Schedule.
(b) With respect to Continuing Employees, there shall be no waiting
period or preexisting condition exclusions applicable under the health benefits
coverage to be provided following the Effective Time to such persons, but the
benefits previously received by such persons will not count toward the maximum
benefit coverages provided by Northwest.
(c) Any full-time employee of Corry as of the Effective Time (other
than any such employee whose written employment agreement is assumed as provided
for herein) who is terminated by Northwest within one (1) year following the
Effective Time without "cause" (as defined herein), except in the case of
voluntary resignation, disability or death, shall be entitled to severance
benefits equal to one week's salary for each year of service to Corry as of the
date of termination, up to a maximum of 18 weeks, calculated on a pre-tax basis.
For purposes of the preceding sentence, "cause" shall mean either (a) a
continued failure by the employee to substantially perform his or her assigned
duties, which duties shall be substantially similar to the duties which have
been performed by such employees for Corry, or (b) the engaging by the employee
in willful misconduct which is injurious to Bancorp MHC or Northwest. A refusal
by an employee to relocate shall not constitute "cause" and any termination
resulting therefrom, whether voluntary or involuntary, shall be deemed an
involuntary termination without cause, unless such relocation is not more than
fifteen miles in distance from such employee's place of employment prior to
relocation, or not more than fifteen miles in distance greater from such
person's residence at the time of the relocation. It is the intention of
Northwest that various employee benefit plans or other arrangements of Corry
will be terminated and others merged into the corresponding plans or
arrangements of Northwest. Following the Effective Time, Northwest shall honor,
in accordance with their terms, all of the employment or other compensation
agreements or arrangements set forth in Schedule 4.14 of the Corry Disclosure
Schedule and
18
assume all duties, liabilities and obligations under such agreements and
arrangements; provided, however, that such obligations shall be subject to the
provisions of Section 7.10 hereof.
5.5. Filing of Applications. Northwest shall use its best efforts
----------------------
promptly to prepare, submit, publish and file: (a) an application to the
Department pursuant to Section 1604 of the Banking Code; (b) an application to
the FDIC under the Bank Merger Act; and (c) any other applications, notices or
statements required to be filed in connection with the transactions contemplated
hereby.
5.6. Supplement to Northwest Disclosure Schedule. Northwest will
-------------------------------------------
promptly supplement or amend the Northwest Disclosure Schedule with respect to
any matter hereafter arising that, if existing or occurring at the date of this
Agreement, would have been required to be set forth or described in the
Northwest Disclosure Schedule. No supplement or amendment to the Northwest
Disclosure Schedule will have any effect for the purpose of determining
satisfaction of the condition set forth in Section 9.1 hereof.
-----------
5.7. Confidentiality. Northwest agrees to treat as strictly
---------------
confidential and agrees not to divulge to any other person, natural or corporate
(other than employees of, and attorneys and accountants for, such party) any
proprietary financial statements, schedules, contracts, agreements, instruments,
papers, documents and other information relating to Corry by which it may come
to know or which may come into its possession during the course of its due
diligence investigation of Corry and, if the transactions contemplated hereby
are not consummated for any reason, Northwest agrees promptly to return to Corry
all written proprietary material furnished in connection with such
investigation.
ARTICLE VI.
COVENANTS OF XXXXX
Xxxxx hereby agrees that from the date of this Agreement until the
Effective Time:
6.1. Affirmative Covenants. Unless the prior written consent of
---------------------
Northwest shall have been obtained (which shall not be unreasonably withheld)
and except as otherwise contemplated herein, Corry will:
(a) operate its business in the ordinary course in accordance with
past business practices;
(b) use its best efforts to preserve intact its business organization
and assets, maintain its rights and franchises, retain the services of its
officers and key employees (except that it shall have the right to terminate the
employment of any officer or key employee in accordance with established
employment procedures) and maintain its relationships with customers:
19
(c) maintain its corporate existence in good standing and file all
required Corry Reports (as defined in such Section 12.7(c) hereof);
---------------
(d) use its best efforts to maintain and keep its properties in as
good repair and condition as at present, except for ordinary wear and tear;
(e) use its 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 and, in the event that Corry is unable to keep such insurance and bonds in
full force and effect, to provide prompt notice of such failure to Northwest;
(f) perform all obligations required to be performed by it under all
material contracts, leases, and documents relating to or affecting its assets,
properties, and business;
(g) use its best efforts to comply with and perform in all material
respects all obligations and duties imposed upon it by all applicable laws and
regulations; and
(h) as soon as reasonably practicable, furnish Northwest copies of all
of Xxxxx'x reports filed with the FDIC and the Department subsequent to the date
hereof.
6.2. Negative Covenants. Except as specifically contemplated by
------------------
this Agreement, from the date hereof until the Effective Time, Corry shall not,
without the prior written consent of Northwest (which shall not be unreasonably
withheld), do any of the following:
(a) incur any material liabilities or material obligations, whether
directly or by way of guaranty, including any obligation for borrowed money
whether or not evidenced by a note, bond, debenture or similar instrument or
enter into or extend any material agreement or lease, except in the ordinary
course of business consistent with prudent business practices or in connection
with the transactions contemplated and permitted by the Agreement;
(b) (i) grant any bonus or material increase in compensation to its
trustees or grant any bonus or any increase in compensation to its officers and
employees either individually or as a class, except routine periodic increases
in salary for employees in the ordinary course of business and in accordance
with past practices or as required by law; (ii) effect any change in retirement
benefits to any class of employees or officers (unless any such change shall be
required by applicable law) that would increase its retirement benefit
liabilities; (iii) adopt, enter into, amend or modify any Corry Benefit Plan; or
(iv) enter into or amend any employment, severance or similar agreements or
arrangements with any trustees or officers, except as contemplated by this
Agreement;
(c) declare or pay any special dividend on, or make any other
distribution in respect of, its deposit accounts;
20
(d) (i) merge with or into any other corporation, savings institution
or bank, permit any other corporation, savings institution or bank to merge into
it or consolidate with any other corporation or bank, in either case, unless the
fiduciary duties of Xxxxx'x Board of Trustees require it to do so, or effect any
reorganization or recapitalization; (ii) purchase or otherwise acquire any
assets, or shares of any class of stock, of any corporation, savings
institution, bank or other business; or (iii) liquidate, sell, dispose of, or
encumber any assets or acquire any assets, other than in the ordinary course of
its business consistent with past practices;
(e) initiate, solicit or encourage, or take any other action to
facilitate, any inquiries or the making of any proposal for a merger or sale of
assets of Corry (a "Proposal"), or negotiate with any person in, or agree to or
endorse any, or authorize or permit any of its officers, trustees or employees
or any investment banker, financial advisor, accountant or other representative
retained by it to take any such action, except as required by the fiduciary
duties of the Xxxxx'x Board of Trustees under applicable law, and Corry shall
promptly notify Northwest 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;
(f) propose or adopt any amendments to its charter or by-laws, except
such amendments as may be required to consummate the transactions contemplated
by this Agreement;
(g) enter into an agreement in principle with respect to any
acquisition of a material amount of assets or securities or any release or
relinquishment of any material contract rights not in the ordinary course of
business;
(h) change any of its methods of accounting in effect at December 31,
1996, except as required by changes in laws or regulations or generally accepted
accounting principles concurred in by Xxxxx'x independent certified public
accountants, 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, 1996, except
as may be required by law, regulations, or generally accepted accounting
principles;
(i) willfully take action which would or is reasonably likely to (i)
adversely affect the ability of either of Northwest or Corry to obtain any
necessary approvals of governmental authorities required for the transactions
contemplated hereby; (ii) adversely affect Xxxxx'x ability to perform its
covenants and agreements under this Agreement; or (iii) result in any of the
conditions to the Merger set forth in Articles VIII and X not being satisfied;
------------- -
(j) change in any material respect the lending, investment, deposit,
asset and liability management and other material policies concerning the
business of Corry, unless required by law or regulation or, with respect to
lending or depository activities, unless such change is made in response to
market conditions;
21
(k) make any investment which causes Corry to not be a "domestic
building and loan association" as defined in Section 7701 (a)(19) of the Code;
(l) sell or otherwise dispose of any loan, mortgage-backed security or
investment security except in the ordinary course of business consistent with
prudent banking practices and policies;
(m) modify or restructure the terms of any loans except in the
ordinary course of business consistent with prudent banking practices;
(n) acquire in any manner whatsoever (other than to realize upon
collateral for a defaulted loan) any business or entity; or
(o) agree in writing or otherwise to do any of the foregoing.
6.3. Report to Northwest. Corry will use its best efforts to keep
-------------------
Northwest fully informed concerning all trends and developments of which it
becomes aware that may have a material effect upon the business, any properties
or condition (either financial or otherwise) of Corry.
6.4. Breaches. Corry shall, in the event it becomes aware of the
--------
impending or threatened occurrence of any event or condition which would cause
or constitute a material breach (or would have caused or constituted a breach
had such event occurred or been known prior to the date hereof) of any of its
representations or agreements contained or referred to herein, give prompt
written notice thereof to Northwest and use its best efforts to prevent or
promptly remedy the same.
6.5. Supplement to Disclosure Schedule. Corry will promptly
---------------------------------
supplement or amend the Corry Disclosure Schedule with respect to any matter
hereafter arising that, if existing or occurring at the date of this Agreement,
would have been required to be set forth or described in the Corry Disclosure
Schedule. No supplement or amendment to the Corry Disclosure Schedule will have
any effect for the purpose of determining satisfaction of the condition set
forth in Section 8.2 hereof.
6.6. Consents and Approvals. Corry shall use its best efforts to
----------------------
assist Northwest in obtaining the consents and approvals referenced in Section
8.5 hereof.
22
ARTICLE VII.
ADDITIONAL AGREEMENTS
7.1. Corry Depositors' Meeting. If required by the Regulations,
-------------------------
Corry shall, as soon as is reasonably practicable, call and hold a meeting of
its depositors (the "Corry Depositors' Meeting") to submit for depositor
approval this Agreement. The Board of Trustees of Corry will recommend that
Corry depositors vote in favor of and approve this Agreement at the Corry
Depositors' Meeting.
7.2. Proxy Statement for Corry Depositors' Meeting. For the
---------------------------------------------
purposes of holding the Corry Depositors' Meeting, and if required by the
Department or the FDIC, Corry shall prepare an appropriate proxy statement,
being herein referred to as the "Corry Proxy Statement".
7.3. Cooperation: Regulatory Approvals. The parties shall
---------------------------------
cooperate in the preparation and submission by them, as promptly as reasonably
practicable, of such applications, petitions, and other documents and materials
as any of them may reasonably deem necessary or desirable to the Department, the
FDIC, the Federal Reserve Board, the Securities and Exchange Commission, other
regulatory authorities, and any other persons for the purpose of obtaining any
approvals or consents necessary to consummate the transactions contemplated by
the Agreement. Corry shall also provide to Northwest any information relating to
Corry that shall be reasonably necessary or required to be included in any
prospectus or registration statement used to sell common stock in connection
with the Stock Offering. Each party will have the right to review and comment on
such applications, petitions and other documents and materials and shall furnish
to the other copies thereof promptly after filing or submission thereof. At the
date hereof, none of the parties is aware of any reason that the regulatory
approvals required to be obtained by it would not be obtained. The obligation to
take action as provided in this Section 7.3 shall not be construed as including
-----------
an obligation to accept any terms of or conditions to a consent, authorization,
order or approval of, or any exemption by, any party that are unduly burdensome
as reasonably determined by the Board of Directors of Northwest or Board of
Trustees of Corry. In the event of a restraining order or injunction which
prevents the Closing by reason of the operation of Section 10.2, each of the
parties hereto shall use its respective best efforts to cause such order or
injunction to be lifted and the Closing to be consummated as soon as reasonably
practicable.
7.4. Brokers or Finders. Each of Northwest and Corry represents
------------------
that no agent, broker, investment banker, financial advisor or other firm or
person is or will be entitled to any broker's or finder's fee or any other
commission or similar fee in connection with any of the transactions
contemplated by this Agreement.
7.5. Additional Agreements: Reasonable Efforts. Subject to the
-----------------------------------------
terms and conditions of this Agreement, each of the parties hereto agrees to use
all reasonable efforts to take, or cause to be taken, all action and to do, or
cause to be done, all things necessary, proper or advisable under applicable
laws and regulations to consummate and make effective the transactions
23
contemplated by this Agreement, subject to the appropriate vote of the
depositors of Corry described in Section 7.1, including cooperating fully with
-----------
the other party. In case at any time after the Effective Time any further action
is necessary or desirable to carry out the purposes of this Agreement or to vest
Northwest with full title to all properties, assets, rights, approvals,
immunities and franchises of Corry, the proper officers and directors/trustees
of each party to this Agreement shall take all such necessary action.
7.6. Release of Information. Corry and Northwest agree that prior
----------------------
to making any public announcement with respect to the transactions contemplated
by this Agreement, each party will consult with the other and will use its best
efforts either to agree upon the text of the proposed joint announcement to be
made by both parties or to obtain the other's approval (which approval shall not
be unreasonably withheld) of the text of an announcement to be made solely on
behalf of such party. In the event that the parties do not ultimately agree on
the text of any proposed public announcement, no such disclosure shall be made
unless the party seeking to make an announcement is advised by counsel that its
failure to do so would be reasonably likely to constitute a violation of law.
7.7. Advisory Directors. Each member of the Board of Trustees of
------------------
Corry as of the date of this Agreement shall be entitled to serve on an Advisory
Board to the Board of Directors of Northwest. The non-employee Advisory
Directors shall receive an annual fee no less than the annual fee currently paid
to such persons as trustees of Corry as of the date of this Agreement. The
Advisory Board will meet monthly. Meetings of the Advisory Board of Directors
shall be held in either Xxxxxx or Corry, Pennsylvania, or such other location as
a majority of the Advisory Directors shall agree.
7.8. Indemnification and Insurance Coverage. Northwest agrees
--------------------------------------
that all rights to indemnification or exculpation now existing in favor of the
trustees, officers, employees and agents of Corry as provided under applicable
law or in its charter, bylaws, indemnification agreements or otherwise in effect
as of the date hereof with respect to matters occurring prior to the Effective
Time shall survive the Merger and shall continue in full force and effect
thereafter until such time as the applicable statute of limitations has expired.
Thereafter, such persons shall be indemnified to the extent permitted by
Northwest's charter and bylaws. In the event of any claim or litigation giving
rise to such indemnification, Northwest will provide the indemnified party with
reasonable access to and the right to copy all documents and other information
relating to the subject matter of the litigation and will reasonably cooperate
in the defense of such litigation. An employee, agent, trustee or officer of
Corry seeking indemnification pursuant to the provisions of Xxxxx'x articles of
incorporation or bylaws shall be entitled to have the resolution of any dispute
regarding the right to and the extent of the indemnification, including without
limitation the right to the advancement of or the reimbursement of legal fees
and expenses related to such claim or litigation, resolved by an arbitrator
selected by Northwest and the indemnified party in accordance with the rules of
the American Arbitration Association.
24
7.9. Directors' Life Insurance. Northwest will continue to
-------------------------
provide those members of the Advisory Board with life insurance coverage
substantially equivalent to the life insurance coverage currently in effect for
trustees of Corry as of the Effective Time, and Northwest shall continue to
maintain such insurance coverage for as long as such persons serve on the
Advisory Board.
7.10. Retention of Senior Officers. Northwest agrees to honor all
----------------------------
terms and conditions of each employment agreement of Corry listed in Schedule
--------
4.14 of the Corry Disclosure Schedule, which is in effect on the date of this
----
Agreement.
7.11. Access to Properties and Records: Confidentiality.
-------------------------------------------------
(a) Corry shall permit Northwest and its representatives reasonable
access to its properties, and shall disclose and make available to them all
books, papers and records relating to the assets, stock ownership, properties,
operations, obligations and liabilities of Corry, including, but not limited to,
all books of account (including the general ledger), tax records, minute books
of meetings of the board of trustees (and any committees thereof),
organizational documents, bylaws, material contracts and agreements, filings
with any regulatory authority, accountants' work papers, litigation files, plans
affecting employees, and any other business activities or prospects in which
Xxxxx xxx have a reasonable interest. Corry shall make its officers, employees
and agents and authorized representatives (including counsel and independent
public accountants) available to confer with Northwest and its representatives.
Corry shall permit the President of Northwest to attend regular meetings of
Xxxxx'x Board of Trustees', including, without limitation, the loan committee or
asset/liability committee meetings.
(b) All information furnished previously in connection with the
transactions contemplated by this Agreement or pursuant hereto shall be treated
as the sole property of the party furnishing the information until consummation
of the transactions contemplated hereby and, if such transactions shall not
occur, the party receiving the information shall, upon request, return to the
party which furnished such information all documents or other materials
containing, reflecting or referring to such information, shall use its best
efforts to keep confidential all such information, and shall not directly or
indirectly use such information for any competitive or other commercial
purposes. The obligation to keep such information confidential shall continue
for three years from the date the proposed transactions are abandoned but shall
not apply to (i) any information which (x) the party receiving the information
can establish by convincing evidence was already in its possession prior to the
disclosure thereof by the party furnishing the information; (y) was then
generally known to the public; or (z) became known to the public through no
fault of the party receiving the information; or (ii) disclosures pursuant to a
legal requirement or in accordance with an order of a court of competent
jurisdiction, provided that the party which is the subject of any such legal
requirement or order shall use its best efforts to give the other party at least
ten business days prior notice thereof.
25
7.12 Charitable Foundation. On or prior to the Effective Time,
---------------------
Northwest and Corry shall use their best efforts to establish a charitable
foundation (the "Charitable Foundation") for the purpose of providing charitable
contributions to Corry, Pennsylvania and in other market areas served by
Northwest. The contribution by Corry to the Charitable Foundation shall be
$500,000 which contribution shall be made either prior to the Effective Time or
promptly thereafter, at the discretion of Northwest. Northwest or Bancorp MHC
shall make additional contributions to the Charitable Foundation, and the
Charitable Foundation shall maintain a division using funds contributed or
earmarked by Corry that is devoted substantially to the Corry community. In the
event Northwest determines that it is not feasible or practicable to establish
the Charitable Foundation and that the alternative of making charitable
contributions directly or through Bancorp MHC is preferable, then the funds
(described above) to be earmarked or contributed by Corry shall be contributed
directly by Corry to charities or other organizations of its choice prior to or
after the Effective Time. The Corry Advisory Board, as described in paragraph
7.7 of this Agreement, shall advise the foundation manager ("Foundation
Manager") of the Charitable Foundation on appropriate charities and appropriate
distribution of the annual income, and such principal as may be deemed
appropriate, from the Corry division of the Charitable Foundation.
7.13. Certain Policies. At the request of Northwest, Xxxxx shall,
----------------
no earlier than five business days prior to the Effective Time, (i) establish
such reserves and accruals as Northwest shall reasonably request to conform, on
a mutually satisfactory basis, Xxxxx'x loan, real estate, accrual and reserve
policies to Northwest's policies and (ii) establish and take such accruals,
reserves and charges in order to implement such policies in respect of severance
costs, write-off or write-down of various assets and other appropriate
accounting adjustments, and to recognize for financial accounting purposes such
expenses incurred in connection with the Merger, provided, however, that Corry
shall not be obligated to take any such action pursuant to this Section 7.12
unless and until (x) Northwest specifies its request in a writing delivered to
Corry, and acknowledges that all conditions to the obligations of Northwest to
consummate the Merger set forth in Articles VIII and X have been waived (if
available) or satisfied and (y) Corry acknowledges that the conditions to its
obligation to consummate the Merger set forth in Articles IX and X have been
waived (if available) or satisfied. Corry shall not be required to take any such
action that is not consistent with generally accepted accounting principles, as
determined by Xxxxx'x independent auditors, or any requirement applicable to
Corry by any bank regulatory agency. The representations, warranties and
covenants of Corry contained in this Agreement shall not be deemed to be untrue
or breached in any respect for any purpose as a consequence of any action
undertaken on account of Sections 7.13 and shall not constitute grounds for
termination of the Agreement by Northwest.
26
ARTICLE VIII.
CONDITIONS TO THE OBLIGATIONS OF NORTHWEST
The obligations of Northwest under this Agreement to cause the
transactions contemplated herein to be consummated shall be subject to the
satisfaction or written waiver by Northwest of the following conditions:
8.1. No Material Adverse Effect. Except as disclosed in Schedule
-------------------------- --------
4.5 to the Corry Disclosure Schedule and except for general changes in market
---
interest rates, payments due under any employment agreements or benefit plans
and the transactions contemplated hereby, costs and expenses relating to this
Agreement and the transactions contemplated hereby, there shall not have been
any Material Adverse Effect, or discovery of a condition or the occurrence of
any event that has or is likely to result in such a Effect, in the financial
condition, results of operations or business of Corry from December 31, 1996 to
the Closing Date; provided, however, that there shall not have occurred a
Material Adverse Effect for purposes of this Section 8.1 if such action that
-----------
would have given rise to a Material Adverse Effect was taken by Corry at the
request of Northwest pursuant to Section 7.13 of this Agreement.
------------
8.2. Representations and Warranties. Each of the representations
------------------------------
and warranties by Corry contained in this Agreement shall be true and correct in
all material respects (or where any statement in a representation or warranty
expressly contains a standard of materiality, such statement shall be true and
correct in all respects taking into consideration the standard of materiality
contained therein) at, or as of, the date of this Agreement and (except to the
extent such representation speaks as of an earlier date) and as of any date
subsequent, until and including the Closing Date (except as otherwise
contemplated or permitted by this Agreement) as though such representations and
warranties were made on and as of said date. Any information provided by Corry
pursuant to Section 6.5 hereof as a supplement to the Corry Schedule shall be
true and correct in all material respects as of the date such information is
supplied to Northwest.
8.3. Performance and Compliance. Corry shall have performed or
--------------------------
complied in all material respects with all covenants and agreements required by
the Agreements to be performed and satisfied by it on or prior to the Closing
Date.
8.4. No Proceeding or Litigation. On the Closing Date, no suit,
---------------------------
action or proceeding shall be pending or overtly threatened, and no liability or
claim shall have been asserted against Corry involving any of the assets,
properties, business or operations of Corry that would reasonably be expected to
have a Material Adverse Effect.
8.5. Consents Under Agreements. Northwest shall have received the
-------------------------
consent or approval of each person whose consent or approval shall be required
in order to permit consummation of the Merger under any loan or credit
agreement, note, mortgage, indenture, lease or other agreement or instrument to
which Corry is a party or to which its respective property is
27
subject, except those for which failure to obtain such consents and approvals
would not, individually or in the aggregate, have a Material Adverse Effect on
Bancorp MHC or Northwest, whether prior to (if applicable) or following the
consummation of the transactions contemplated hereby.
8.6. No Amendments to Resolutions. Neither the Board of Trustees
----------------------------
of Corry nor any committee thereof shall have amended, modified, rescinded or
repealed the resolutions adopted by such Board of Trustees with respect to the
Agreement or shall have adopted any other resolutions in connection with the
Agreement and the transactions contemplated hereby which are inconsistent with
such resolutions, except resolutions adopted consistent with the express rights
of Corry under this Agreement.
8.7. Certificate of Corry Officers. Corry shall have furnished
-----------------------------
Northwest a certificate, signed by its Chief Executive Officer, dated the
Closing Date, to the effect, based on his knowledge, that the conditions
described in Sections 8.1, 8.2, 8.3, 8.4, 8.5, and 8.6 of this Agreement have
been fully satisfied.
8.8. Corporate Proceedings. All action required to be taken by,
---------------------
or on the part of Corry to authorize the execution, delivery and performance of
this Agreement and the consummation of the transactions contemplated by this
Agreement shall have been duly and validly taken by Corry.
ARTICLE IX.
CONDITIONS TO THE OBLIGATIONS OF CORRY
The obligations of Corry under this Agreement to cause the
transactions contemplated herein to be consummated shall be subject to the
satisfaction or written waiver by Corry of the following conditions:
9.1. Representations and Warranties. Each of the representations
------------------------------
and warranties of Northwest contained in this Agreement shall be true and
correct in all material respects (or where any statement in a representation or
warranty expressly contains a standard of materiality, such statement shall be
true and correct in all respects taking into consideration the standard of
materiality contained therein) at, or as of, the date of this Agreement and
(except to the extent such representation speaks as of an earlier date) and as
of any date subsequent, until and including the Closing Date (except as
otherwise contemplated or permitted by this Agreement) as though such
representations were made on and as of said date. Any information provided by
Northwest pursuant to Section 5.7 hereof as a supplement to the Northwest
-----------
Disclosure Schedule shall be true and correct in all material respects as of the
date such information is supplied to Corry.
28
9.2. Performance and Compliance. Northwest shall have performed
--------------------------
or complied in all material respects with all covenants and agreements required
by this Agreement to be performed and satisfied by it on or prior to the Closing
Date.
9.3. Corporate Proceedings. All action required to be taken by,
---------------------
or on the part of Bancorp MHC and Northwest to authorize the execution, delivery
and performance of this Agreement and the consummation of the transactions
contemplated by this Agreement shall have been duly and validly taken by Bancorp
MHC and Northwest.
9.4. Certificate of Northwest Officers. Northwest shall have
---------------------------------
furnished to Corry a certificate, signed by its Chief Executive Officer and its
Chief Financial Officer and dated the Closing Date, to the effect, based on
their best knowledge, that the conditions described in Sections 9.1, 9.2 and 9.3
-------------------------
of this Agreement have been satisfied.
ARTICLE X.
CONDITIONS TO THE OBLIGATIONS OF ALL PARTIES
In addition to the provisions of Articles VIII and IX hereof, the
obligations of Northwest and Corry to cause the transactions contemplated herein
to be consummated, shall be subject to the satisfaction or written waiver by
both Northwest and Corry of the following conditions:
10.1. Governmental Approvals. The parties hereto shall have
----------------------
received all necessary approvals of the transactions contemplated by the
Agreements from governmental agencies and authorities, including, without
limitation, those of the Department, the FDIC, the DOJ, the Federal Reserve
Board and each of such approvals shall remain in full force and effect and all
statutory waiting periods in connection therewith shall have expired at the
Closing Date and such approvals and the transactions contemplated thereby shall
not have been contested by any federal or state governmental authority nor by
any other third party by formal proceeding. Provided, however, that no approval
or consent referred to in this Section 10.1 shall be deemed to have been
received by Northwest if it shall include any term, condition or requirement
that, individually or in the aggregate, (i) would result in a material adverse
effect on the results, business, operations, assets, or financial condition of
Northwest on a consolidated basis, or (ii) would reduce the economic or business
benefits of the transactions contemplated by this Agreement to Northwest in so
material a manner that Northwest, in its reasonable judgment, would not have
entered into this Agreement; provided further, that no condition or requirement
which does no more than subject Corry, Northwest or Bancorp MHC to legal
requirements generally applicable to entities and transactions of the same type
as a matter of law shall be deemed to affect materially the economic benefits of
the transactions contemplated by this Agreement. Northwest shall notify Corry in
writing of its intention to terminate this Agreement pursuant to Section 11.1(b)
---------------
hereof as a result of the receipt by Northwest of any such term, condition
29
or requirement within five business days of the written receipt of such term,
condition or requirement, or the condition set forth in the second sentence of
this Section 10.1 shall be deemed waived by Northwest.
------------
10.2. No Injunctions or Restraints. No suit, action or proceeding
----------------------------
shall be pending or overtly threatened before any court or other governmental
agency by the federal or any state government in which it is sought to restrain
or prohibit the consummation of the Merger and no temporary restraining order,
preliminary or permanent injunction or other order issued by any court of
competent jurisdiction or other legal restraint or prohibition preventing the
consummation of the Merger shall be in effect.
10.3. Corry Depositor Approval. To the extent required by the FDIC
------------------------
or the Department, this Agreement shall have been duly approved by the requisite
affirmative vote of the depositors of Corry as contemplated by Section 7.1
hereof.
10.4 Corporate Proceedings. The obligations of the parties to
---------------------
this Agreement required to be performed at or prior to the Closing Date shall
have been duly performed and complied with in all material respects. All action
required to be taken by, or on the part of, the parties to this Agreement to
authorize the execution, delivery and performance of this Agreement, and the
consummation of the transactions contemplated hereby, shall have been duly and
validly taken by the parties hereto.
ARTICLE XI.
TERMINATION
11.1. Reasons for Termination. This Agreement may be terminated
-----------------------
and the Merger abandoned at any time before the Closing Date, whether before or
after the approval or adoption of the Agreements by the depositors of Corry:
(a) By mutual written consent of the Board of Directors of Northwest
and the Board of Trustees of Corry;
(b) By written notice from Northwest to Corry if:
(i) any condition set forth in Article VIII of this Agreement
------------
shall have become impossible to substantially satisfy at any time or has not
been substantially satisfied or waived in writing; or
(ii) any condition set forth in Article X of this Agreement
---------
shall have become impossible to substantially satisfy at any time or has not
been substantially satisfied or waived in writing, provided, however, Northwest
shall not have the right to terminate this Agreement pursuant to this Section
-------
11.1(b)(ii) if any condition imposed by Section 10.1 hereof
----------- ------------
30
was not met due to the failure of Northwest to perform or observe the covenants
and agreements set forth in this Agreement; or
(iii) any warranty or representation as set forth in Article
-------
IV hereof made by Corry shall be discovered to be or to have become untrue or
--
incorrect in any material respect, or where any statement in a representation or
warranty expressly includes a standard of materiality, such statement shall be
discovered to be or to have become untrue or incorrect in any respect taking
into consideration the standard of materiality contained therein, in either case
where any such breach has not been cured within thirty (30) days following
receipt by Corry of written notice of such discovery;
(iv) Corry shall have breached one or more provisions of this
Agreement in any material respect considering all such breaches in the
aggregate, where such breach has not been cured within thirty (30) days
following receipt by Corry of written notice of such breach; or
(c) By written notice from Corry to Northwest, which has been approved
by the Board of Trustees of Corry, if
(i) any condition set forth in Article IX of this Agreement has
----------
not been substantially satisfied or waived in writing; or
(ii) any condition set forth in Article X of this Agreement has
---------
not been substantially satisfied or waived in writing; provided, however, Corry
shall not have the right to terminate this Agreement pursuant to this Section
-------
11.1(c)(ii) if any condition imposed by Section 10.1 hereof was not met due to
----------- ------------
the failure of Corry to perform or observe the covenants and agreements set
forth in this Agreement; or
(iii) any warranty or representation as set forth in Article
-------
III hereof made by Northwest shall be discovered to be or to have become untrue
---
or incorrect in any material respect, or where any statement in a representation
or warranty expressly includes a standard of materiality, such statement shall
be discovered to be or to have become untrue or incorrect in any respect taking
into consideration the standard of materiality contained therein, in either case
where any such breach has not been cured within thirty (30) days following
receipt by Northwest of written notice of such discovery; or
(iv) Northwest shall have breached one or more provisions of this
Agreement in any material respect considering all such breaches in the
aggregate, where such breach has not been cured within thirty (30) days
following receipt by Northwest of written notice of such breach.
(d) By the Board of Directors of Northwest if the Board of Trustees of
Corry shall not recommend, or shall withdraw or modify in a manner adverse to
Northwest, its recommendation to the Corry depositors to approve this Agreement.
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(e) By the Board of Directors of Northwest or Board of Trustees of
Corry at any time if the depositors of Corry have not approved this Agreement by
the requisite affirmative vote (if such depositors approval is required by the
FDIC or the Department).
(f) By the Board of Directors of Northwest or Board of Trustees of
Corry if the Merger has not been consummated on or before March 31, 1998.
11.2. Effect of Termination. In the event of termination of this
---------------------
Agreement by either Corry or Northwest as provided in Section 11.1, this
------------
Agreement shall forthwith become void, and there shall be no liability or
obligation on the part of Northwest or Corry or their respective officers,
trustees or directors except with respect to Sections 5.7, 7.5 and 12.2 hereof.
--------------------------
ARTICLE XII.
MISCELLANEOUS
12.1. Nonsurvival of Representations, Warranties and Agreements.
---------------------------------------------------------
None of the representations, warranties, covenants and agreements in this
Agreement or in any instrument delivered pursuant to this Agreement shall
survive the Effective Time, except for the covenants and agreements which by
their terms are contemplated to be performed after the Effective Time.
12.2. Expenses. Except as otherwise provided herein, all expenses
--------
incurred by Northwest and Corry in connection with or related to the
authorization, preparation and execution of the Agreement, the solicitation of
any required depositor approvals and all other matters related to the closing of
the transactions contemplated thereby, including, without limitation of the
generality of the foregoing, all fees and expenses of agents, representatives,
counsel and accountants employed by either such party or its Affiliates, shall
be borne solely and entirely by the party that has incurred the same.
12.3. Waivers: Amendments. At any time prior to the Closing Date,
-------------------
either Northwest, by action taken by its Board of Directors, or any committee or
officers thereunto authorized, or Corry, by action taken by its Board of
Trustees, or any committee or officers thereunto authorized, may waive the
performance of any of the obligations of the other or waive compliance by the
other with any of the covenants or conditions contained in the Agreement or
agree to the amendment or modification of the Agreement by an agreement in
writing executed in the same manner as the Agreement.
12.4. Assignment: Parties in Interest. The Agreement shall be
-------------------------------
binding upon and inure solely to the benefit of the parties hereto and their
respective successors and assigns, but shall not be assigned by the parties
hereto, by operation of law or otherwise, without the prior written consent of
the other parties. Nothing in the Agreement, express or implied, is intended to
confer upon any third party any rights or remedies of any nature whatsoever
under or by reason of the Agreement.
32
12.5. Entire Agreement. This Agreement supersedes any other
----------------
agreement, whether written or oral, that may have been made or entered into by
Corry or Northwest or by any officer or officers of such parties relating to the
acquisition of the business or assets of Corry by Northwest. The aforementioned
agreements constitute the entire agreement by the respective parties, and there
are no agreements or commitments except as set forth herein and therein.
12.6. Captions and Counterparts. The captions in this Agreement
-------------------------
are for convenience only and shall not be considered a part of or affect the
construction or interpretation of any provision of this Agreement. This
Agreement may be executed in several counterparts, each of which shall
constitute one and the same instrument.
12.7. 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, another person;
(b) "Material Adverse Effect" shall mean any material adverse change
in or material adverse effect on the business, operations, assets, or financial
condition of the parties to this Agreement.
(c) "Corry Reports" shall mean all reports, registrations, and
statements, together with any amendments required to be made with respect
thereto that were and are required to be filed with the Department or the FDIC,
or any other applicable savings institution regulatory authority.
(d) "to the knowledge of Northwest" or "to the best knowledge of
Northwest" shall mean the actual knowledge of any member of the Board of
Directors or of any senior officer of Northwest.
(e) "to the knowledge of Corry" or "to the best knowledge of Corry"
shall mean the actual knowledge of any member of the Board of Trustees or of any
senior officer of Corry.
12.8. Governing Law. The Agreement shall be construed and
-------------
interpreted in accordance with the laws of the Commonwealth of Pennsylvania,
without regard to the conflicts of laws rules.
12.9. Notices. All notices given hereunder shall be in writing and
-------
shall be mailed by first class mail, postage prepaid, or sent by facsimile
transmission or by nationally recognized overnight delivery service, addressed
as follows:
33
(a) If to Northwest to:
Xxxxxxxxx Xxxxxxx Xxxx
Xxxxxxx Xxxxxx at Second Avenue
Warren, Pennsylvania 16365
Attention: Xx. Xxxx X. Xxxxx, President
Facsimile No. (000) 000-0000
With A Copy To:
Xxxx Xxxxxx Xxxxxx Xxxxxxxx & Xxxxxx
0000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxx 000
Xxxxxxxxxx, X.X. 00000
Attention: Xxxx Xxxx, Esq.
Xxxxxxx X. Xxxxxx, Esq.
Facsimile No. (000) 000-0000
(b) If to Corry to:
Corry Savings Bank
000 Xxxxx Xxxxxx
Xxxxx, Xxxxxxxxxxxx 00000
Attention: Xx. Xxxxx X. Xxxxxxx, President
Facsimile No. (000) 000-0000
with a copy to:
Xxxxx X. Xxxxxx, Esq.
Goldfarb, Posner, Xxxx, XxXxxxx & Xxxxxxx
00 Xxxxx Xxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxx, XX 00000
Facsimile No. (000) 000-0000
34
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
ATTEST: NORTHWEST SAVINGS BANK
By: /s/ Xxxxxxx X. XxXxxxx By: /s/ Xxxx X. Xxxxx
---------------------------- ---------------------------
Xxxxxxx X. XxXxxxx, Senior Xxxx X. Xxxxx, President
Vice President and Secretary
ATTEST: NORTHWEST BANCORP, M.H.C.
By: /s/ Xxxxxxx X. XxXxxxx By: /s/ Xxxx X. Xxxxx
---------------------------- ---------------------------
Xxxxxxx X. XxXxxxx, Senior Xxxx X. Xxxxx, President
Vice President and Secretary
ATTEST: XXXXX SAVINGS BANK
By: /s/ Xxxxx X. Xxxxxxx By: /s/ Xxxxx X. Xxxxxxx
---------------------------- ---------------------------
Xxxxx X. Xxxxxxx, Director Xxxxx X. Xxxxxxx, President
and Secretary
35
