AGREEMENT AND PLAN OF REORGANIZATION
Agreement and Plan of Reorganization, dated as of August 4, 1997 (the
"Agreement"), by and between Community Savings, F. A. (the "Association" or the
"Surviving Association"), a federally chartered savings and loan association,
Community Interim Federal Savings Association ("Interim"), a federally chartered
savings association, and Community Savings Bankshares, Inc., a federally
chartered corporation.
WITNESSETH:
WHEREAS, the Board of Directors of the Association has determined that it
is in the best interests of the Association and its shareholders for the
Association to be reorganized into a mid-tier stock holding company form of
ownership whereby Community Savings Bankshares, Inc. will hold 100% of the
Association's outstanding common stock and ComFed, M. H. C., the present mutual
holding company for the Association, will become the mutual holding company for
Community Savings Bankshares, Inc.
WHEREAS, the Association will cause Community Savings Bankshares, Inc. to
be organized under federal law and regulation as a wholly owned subsidiary for
the purpose of becoming the holding company of the Association (such corporation
being referred to herein as the "Company"); and
WHEREAS, the formation of a mid-tier stock holding company by the
Association will be facilitated by causing the Company to become the sole
shareholder of a newly formed interim federally chartered stock savings
association, and then merging the interim savings association with and into the
Association, so that as part of the merger all of the outstanding shares of
common stock of the Association will be converted automatically into and become
shares of common stock of the Company, which would then become the sole
shareholder of the Association (the "Merger"); and
WHEREAS, Interim is being organized by the Association as an interim
federally chartered stock savings association with the Company as its sole
shareholder in order to effect the Merger; and
WHEREAS, the Association and Interim (the "Constituent Associations")
desire to provide for the terms and conditions of the Merger;
NOW, THEREFORE, the Association, Interim and the Company hereby agree as
follows:
1. Effective Date. The Merger shall become effective on the date
specified in the endorsement of the articles of combination relating to the
Merger by the Secretary of the Office of Thrift Supervision ("OTS") pursuant to
12 C.F.R. (S)552.13(k), or any successor thereto (the "Effective Date").
2. The Merger and Effect Thereof. Subject to the terms and conditions set
forth herein, including, without limitation, the prior approval of the OTS and
the expiration of all applicable waiting periods, Interim shall merge with and
into the Association, which shall be the Surviving Association. Upon
consummation of the Merger, the Surviving Association shall be considered the
same business and corporate entity as each of the Constituent Associations and
thereupon and thereafter all the property, rights, powers and franchises of each
of the Constituent Associations shall vest in the Surviving Association and the
Surviving Association shall be subject to and be deemed to have assumed all of
the debts, liabilities, obligations and duties of each of the Constituent
Associations and shall have succeeded to all of each of their relationships,
fiduciary or otherwise, as fully and to the same extent as if such property,
rights, privileges, powers, franchises, debts, obligations, duties and
relationships had been originally acquired, incurred or entered into by the
Surviving Association. In addition, any reference to either of the Constituent
Associations in any contract, will or document, whether executed or taking
effect before or after the Effective Date, shall be considered a reference to
the Surviving Association if not inconsistent with the other provisions of the
contract, will or document; and any pending action or other judicial proceeding
to which either of the Constituent Associations is a party shall not be deemed
to have abated or to have been discontinued by reason of the Merger, but may be
prosecuted to final judgment, order or decree in the same manner as if the
Merger had not occurred or the Surviving Association may be substituted as a
party to such action or proceeding, and any judgment, order or decree may be
rendered for or against it that might have been rendered for or against either
of the Constituent Associations if the Merger had not occurred.
3. Conversion of Stock.
(a) On the Effective Date, (i) each share of common stock, par value $1.00
per share of the Association ("Community Common Stock"), issued and outstanding
immediately prior to the Effective Date shall, by virtue of the Merger and
without any action on the part of the holder thereof, be converted into one
share of common stock, par value $1.00 per share of the Company ("Company Common
Stock"), (ii) each share of common stock, par value $1.00 per share of Interim
("Interim Common Stock"), issued and outstanding immediately prior to the
Effective Date shall, by virtue of the Merger and without any action on the part
of the holder thereof, be converted into one share of the Community Common
Stock, and (iii) each share of Company Common Stock issued and outstanding
immediately prior to the Effective Date shall, by virtue of the Merger and
without any action on the part of the holder thereof, be cancelled. By voting in
favor of this Agreement, the Company, as the sole shareholder of Interim, shall
have agreed (i) to issue shares of Company Common Stock in accordance with the
terms hereof and (ii) to cancel all previously issued and outstanding shares of
Company Common Stock upon the effectiveness of the Merger.
(b) On and after the Effective Date, there shall be no registration of
transfers on the stock transfer books of Interim or the Association of shares of
Interim Common Stock or the Community Common Stock which were outstanding
immediately prior to the Effective Date.
4. Exchange of Shares.
(a) At or after the Effective Date, each holder of a certificate or
certificates theretofore evidencing issued and outstanding shares of Community
Common Stock, upon surrender of the same to an agent, duly appointed by the
Company ("Exchange Agent"), shall be entitled to receive in exchange therefor a
certificate or certificates representing the number of full shares of Company
Common Stock for which the shares of Community Common Stock theretofore
represented by the certificate or certificates so surrendered shall have been
converted as provided in Section 3 hereof. At the Company's sole discretion, the
Exchange Agent may mail to each holder of record of an outstanding certificate
which immediately prior to the Effective Date evidenced shares of Community
Common Stock, and which is to be exchanged for Company Common Stock as provided
in Section 3 hereof, a form of letter of transmittal (which shall specify that
delivery shall be effected, and risk of loss and title to such certificate shall
pass, only upon delivery of such certificate to the Exchange Agent) advising
such holder of the terms of the exchange effected by the Merger and of the
procedure for surrendering to the Exchange Agent such certificate in exchange
for a certificate or certificates evidencing Company Common Stock.
(b) After the Effective Date, certificates representing shares of
Community Common Stock shall be treated as evidencing ownership of the number of
full shares of Company Common Stock into which the shares of Community Common
Stock represented by such certificates shall have been converted by virtue of
the Merger, notwithstanding whether or not the holder thereof has surrendered
such certificates.
(c) If any certificate evidencing shares of Company Common Stock is to be
issued in a name other than that in which the certificate evidencing Community
Common Stock surrendered in exchange therefor is registered, it shall be a
condition of the issuance thereof that the certificate so surrendered shall be
properly endorsed and otherwise in proper form for transfer and that the person
requesting such exchange pay to the Exchange Agent any transfer or other tax
required by reason of the issuance of a certificate for shares of Company Common
Stock in any name other than that of the registered holder of the certificate
surrendered or otherwise establish to the satisfaction of the Exchange Agent
that such tax has been paid or is not payable.
(d) If, between the date hereof and the Effective Date, the shares of
Community Common Stock shall be changed into a different number or class of
shares by reason of any reclassification, recapitalization, split-up,
combination, exchange of shares or readjustment, or a stock dividend thereon
shall be declared with a record date within said period, the exchange ratio
specified in Section 3(a) hereof shall be adjusted accordingly.
5. Dissenting Shares. Subject to the provisions of 12 C.F.R.
(S)552.14(b), or any successor thereto, no holder of shares of Community Common
Stock shall have any dissenter or appraisal rights in connection with the
Merger.
6. Name of Surviving Association. The name of the Surviving Association
shall be "Community Savings, F. A."
7. Directors of the Surviving Association. Upon and after the Effective
Date, until changed in accordance with the Charter and Bylaws of the Surviving
Association and applicable law, the number of directors of the Surviving
Association shall be six. The names and addresses of those persons who, upon and
after the Effective Date, shall be directors of the Surviving Association are
set forth in Schedule A hereto, which is hereby incorporated herein by
reference. Each such director shall serve for the term which expires at the
annual meeting of shareholders of the Surviving Association in the year set
forth after his respective name in Schedule A, and until a successor is elected
and qualified.
8. Officers of the Surviving Association. Upon and after the Effective
Date, until changed in accordance with the Charter and Bylaws of the Surviving
Association and applicable law, the officers of the Association immediately
prior to the Effective Date shall be the officers of the Surviving Association.
9. Offices. Upon the Effective Date, all offices of the Association and
Interim (which shall have no offices) shall be offices of the Surviving
Association. As of the Effective Date, the home office of the Surviving
Association shall remain at 000 X.X. Xxxxxxx Xxx, Xxxxx Xxxx Xxxxx, Xxxxxxx
00000 and the location of the other offices of the Surviving Association shall
be as set forth in Schedule B hereto, which is hereby incorporated herein by
reference, except for the addition of offices authorized or the deletion of
offices closed subsequent to the date hereof and the Effective Date.
10. Charter and Bylaws. On and after the Effective Date, the Charter and
Bylaws of the Association as in effect immediately prior to the Effective Date
shall be the Charter and Bylaws of the Surviving Association until amended in
accordance with the terms thereof and applicable law.
11. Deposit Accounts. Upon the Effective Date, all deposit accounts of
Interim, without reissue, shall be and become deposit accounts of the Surviving
Association without change in their respective terms, including, without
limitation, maturity, minimum required balances or withdrawal value.
12. Stock Compensation Plans. By voting in favor of this Agreement, the
Company shall have approved adoption of the Association's existing Employee
Stock Ownership Plan ("ESOP"), 1995 Stock Option Plan (the "Plan") and 1995
Recognition and Retention Plan for Employees and Outside Directors ("RRP") as
the ESOP, Plan and RRP of the Company and shall have agreed to issue Company
Common Stock in lieu of Community Common Stock pursuant to the terms of such
ESOP, Plan and RRP. As of the Effective Date of the Merger, rights outstanding
under the ESOP, Plan and RRP shall be assumed by the Company and thereafter
shall be rights only for shares of Company Common Stock, with each such right
being for a number of shares of Company Common Stock equal to the number of
shares of Community Common Stock that were available thereunder immediately
prior to the Effective Date of the Merger, and with no change in the price or
any other term or condition of such right. The Company shall make appropriate
amendments to the ESOP, Plan and RRP to reflect the adoption of the ESOP,
Plan and RRP by the Company without adverse effect upon the allocation of Common
Stock or options or awards outstanding thereunder.
13. Shareholder Approval. The affirmative vote of the holders of a
majority of the issued and outstanding Community Common Stock shall be required
to approve this Agreement on behalf of the Association and the approval of the
Company, as the sole holder of Interim Common Stock, shall be required to
approve this Agreement on behalf of Interim.
14. Registration; Other Approvals. In addition to the approval set forth
in Section 2 hereof, the parties' obligations to consummate the Merger shall be
subject to (i) the Company Common Stock to be issued hereunder in exchange for
Community Common Stock being registered under the Securities Act of 1933, as
amended, and registered or qualified under applicable state securities laws,
except in each case to the extent that the Company relies on an applicable
exemption therefrom, (ii) the qualification of the Company Common Stock for
listing on the Nasdaq National Market, and (iii) the receipt of all other
approvals, consents or waivers as the parties may deem necessary or advisable.
15. Income Tax Matters. The parties hereto shall have received opinions of
counsel or of their independent public accountants, satisfactory to them in form
and substance, with respect to the federal and Florida income tax consequences
of the Agreement and the formation of a mid-tier holding company, as
contemplated therein.
16. Abandonment of Agreement. This Agreement may be abandoned by the
Association, the Company or Interim at any time before the Effective Date in the
event that (a) any action, suit, proceeding or claim has been instituted, made
or threatened relating to the Agreement which shall make consummation of the
transaction contemplated hereby inadvisable in the opinion of the Association,
the Company or Interim, (b) the approval by the OTS of the transactions
contemplated by this Agreement contains any restriction or condition which, in
the sole discretion of the Board of Directors of the Association, is deemed to
be adverse to the Association or the shareholders thereof, or (c) for any other
reason consummation of the transaction contemplated hereby is inadvisable in the
opinion of the Association, the Company or Interim. Such abandonment shall be
effected by written notice by the Association, the Company or Interim to the
other parties, authorized or approved by the Board of Directors of the party
giving such notice. Upon the giving of such notice, this Agreement shall be
terminated and there shall be no liability hereunder or on account of such
termination on the part of the Association, the Company or Interim or the
directors, officers, employees, agents or shareholders of either of them. In the
event of abandonment of this Agreement, the Association shall pay the fees and
expenses incurred by itself, Interim and the Company in connection with this
Agreement and the Merger.
17. Amendments. To the extent permitted by law, this Agreement may be
amended by a subsequent writing signed by the parties hereto upon the approval
of the Board of Directors of each of the parties hereto; provided, however, that
the provisions of Section 3 hereof relating to the consideration to be exchanged
for shares of Community Common Stock shall not be amended after the meeting of
shareholders of the Association
at which this Agreement is considered so as to decrease the amount or change the
form of such consideration without the approval of such shareholders.
18. Successors. This Agreement shall be binding on the successors of the
Association and Interim.
19. Counterparts. This Agreement may be executed in one or more
counterparts.
20. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the United States of America and, to the extent not
governed by such laws, the laws of the State of Florida.
IN WITNESS WHEREOF, the Association, Interim and the Company have caused
this Agreement to be executed by their duly authorized officers as of the day
and year first above written.
COMMUNITY SAVINGS, F. A.
Attest:
/s/ Xxxxxxx X. Xxxxxxxx By: /s/ Xxxxx X. Xxxxxxx, Xx.
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Xxxxxxx X. Xxxxxxxx Xxxxx X. Xxxxxxx, Xx.
Secretary President and Chief Executive Officer
COMMUNITY INTERIM FEDERAL SAVINGS
ASSOCIATION
Attest:
By:
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Xxxxxxx X. Xxxxxxxx Xxxxx X. Xxxxxxx, Xx.
Secretary President and Chief Executive Officer
COMMUNITY SAVINGS BANKSHARES, INC.
Attest:
/s/ Xxxxxxx X. Xxxxxxxx By: /s/ Xxxxx X. Xxxxxxx, Xx.
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Xxxxxxx X. Xxxxxxxx Xxxxx X. Xxxxxxx, Xx.
Secretary President and Chief Executive Officer
