AGREEMENT AND PLAN OF MERGER
BY AND AMONG
ARGENTBANK
AND
ASSUMPTION BANCSHARES, INC.
and
ASSUMPTION BANK & TRUST COMPANY
AGREEMENT AND PLAN OF MERGER
TABLE OF CONTENTS
ARTICLE 1.......................................................1
DEFINITIONS.....................................................1
1.1 "ABI"............................................1
1.2 "Agreement"......................................1
1.3 "ArgentBank".....................................1
1.4 "Assumption Bank"................................1
1.5 "Business Day"...................................1
1.6 "FDIC"...........................................2
1.7 "FRB"............................................2
1.8 "OFI"............................................2
1.9 "Party"..........................................2
1.10 "Person".........................................2
1.11 "SEC"............................................2
ARTICLE 2.......................................................2
THE MERGERS AND RELATED MATTERS.................................2
2.1 Mergers..........................................2
2.2 The Closing......................................2
2.3 The Effective Date and Time......................3
2.4 Effects of the Mergers...........................3
ARTICLE 3.......................................................3
CONVERSION OF STOCK.............................................3
3.1 Conversion of ABI Stock in Company Merger........3
3.2 Conversion of Assumption Bank Common Stock in
Bank Merger......................................3
3.3 Election Procedures and Exchange of Certificates
Representing Assumption Bank Common Stock........5
ARTICLE 4.......................................................8
ACCOUNTING AND TAX MATTERS......................................8
4.1 Accounting Treatment.............................8
4.2 Tax Treatment....................................8
4.3 Accounting and Tax Representations...............8
ARTICLE 5.......................................................8
REPRESENTATIONS AND WARRANTIES OF
ABI AND ASSUMPTION BANK.........................................8
5.1 Organization and Authority.......................8
5.2 Authorization....................................8
5.3 Capital Structure of ABI.........................9
5.4 Ownership of Other Banks.........................9
5.5 ABI Financial and Other Reports..................9
5.6 No Material Adverse Change......................10
5.7 Tax Liability...................................10
5.8 Tax Returns: Payment of Taxes...................10
5.9 Litigation and Proceedings......................10
5.10 Brokers' or Finders' Fees.......................10
5.11 Contingent Liabilities..........................10
5.12 Title to Assets; Adequate Insurance Coverage....11
5.13 Deposits. .....................................12
5.14 Loans...........................................12
5.15 Allowance for Loan Losses.......................12
5.16 Investments.....................................12
5.17 Commitments and Contracts.......................13
5.18 Employee Plans..................................13
5.19 Plan Liability..................................13
5.20 Vote Required...................................13
5.21 Environmental Matters...........................14
5.22 Accuracy of Information.........................15
5.23 Compliance with Laws and Contracts..............15
5.24 Information for Registration and Proxy
Statements......................................15
ARTICLE 6......................................................15
ARGENTBANK'S REPRESENTATIONS AND WARRANTIES....................15
6.1 Organization and Authority......................15
6.2 Authorization...................................15
6.3 Capital Structure of ArgentBank.................16
6.4 ArgentBank Financial and Other Reports..........16
6.5 No Material Adverse Change......................16
6.6 Loans...........................................17
6.7 Litigation......................................17
6.8 Contingent Liabilities..........................17
6.9 Allowances for Loan Losses......................17
6.10 Employee Plans..................................17
6.11 Vote Required...................................18
6.12 Accuracy of Information.........................18
ARTICLE 7......................................................18
COVENANTS OF THE PARTIES.......................................18
7.1 Operation of Business...........................18
7.2 Preservation of Business........................20
7.3 Insurance.......................................20
7.4 ABI Shareholder Approval........................20
7.5 Property Transfers..............................20
7.6 Argent Due Diligence............................20
7.7 No Solicitation.................................21
7.8 Affiliates......................................22
7.9 Conduct of Business.............................22
7.10 ABI and Assumption Bank Due Diligence...........22
7.11 Regulatory Matters..............................23
7.12 ArgentBank Shareholder Approval.................24
7.13 Continuity of Business Enterprise...............24
7.14 Election of Directors...........................25
7.15 Indemnification and Liability Insurance.........25
7.16 Employees.......................................25
7.17 Benefit Plans...................................26
7.18 Further Assurances..............................26
7.19 Mutual Covenant of Best Efforts and Good
Faith...........................................27
7.20 Press Releases..................................27
7.21 Consent of ArgentBank...........................27
ARTICLE 8......................................................27
CONDITIONS TO CLOSING..........................................27
8.1 Conditions to Each Party's Obligations to
Effect the Mergers..............................27
8.2 Additional Conditions to Obligations of ABI
and Assumption Bank to Effect the Mergers.......28
8.3 Additional Conditions to Obligations of
ArgentBank to Effect the Bank Merger............30
ARTICLE 9......................................................32
TERMINATION....................................................32
9.1 Termination.....................................32
9.2 Effect of Termination...........................33
ARTICLE 10.....................................................33
MISCELLANEOUS..................................................33
10.1 Entire Agreement................................33
10.2 Non-Survival of Representations and
Warranties......................................33
10.3 Headings........................................34
10.4 Duplicate Originals.............................34
10.5 Governing Law...................................34
10.6 Successors: No Third Party Beneficiaries........34
10.7 Modification; Assignment........................34
10.8 Notice..........................................34
10.9 Waiver..........................................35
10.10 Costs, Fees and Expenses.......................35
10.11 Severability...................................36
EXHIBITS
Exhibit A Company Merger Agreement
Exhibit B Bank Merger Agreement
Exhibit C Tax Certificates
Exhibit D Form of Affiliate Agreement
Exhibit E Employment Terms and Conditions - Xxxxxx Xxxxxxx
Exhibit F Form of Tax Opinion
AGREEMENT AND PLAN OF MERGER
THIS AGREEMENT AND PLAN OF MERGER (the "Agreement"),
dated as of the ____ day of _____________, 1996, is made by
and among ASSUMPTION BANCSHARES, INC., Napoleonville,
Louisiana, a Louisiana corporation ("ABI"), ASSUMPTION BANK
& TRUST COMPANY, Napoleonville, Louisiana, a Louisiana state
nonmember bank ("Assumption Bank"), and ARGENTBANK,
Thibodaux, Louisiana, a Louisiana state nonmember bank
("ArgentBank").
In consideration of their mutual promises and
obligations, the parties hereto adopt and make this
Agreement for the merger of ABI with and into its wholly-
owned subsidiary, Assumption Bank, and the subsequent merger
of Assumption Bank, with and into ArgentBank and prescribe
the terms and conditions of such mergers and the mode of
carrying them into effect, which shall be as follows:
DEFINITIONS
Certain Defined Terms. As used in this Agreement, the
following terms shall have the following meanings (such
meaning to be equally applicable to both the singular and
plural forms of the terms defined):
1.1 "ABI" means Assumption Bancshares, Inc., a
corporation duly chartered on March 4, 1984, organized, and
existing under and pursuant to the laws of the State of
Louisiana; maintaining its principal place of business at
000 Xxxxxxxx Xxxxxx, Xxxxxxxxxxxxx, Assumption Parish,
Louisiana; and is a bank holding company within the meaning
of the Bank Holding Company Act of 1956, as amended.
1.2 "Agreement" means this Agreement and Plan of
Merger by and among ABI, Assumption Bank, and ArgentBank and
any amendments thereto. References to Articles, Sections,
Schedules and the like refer to the Articles, Sections,
Schedules and the like of this Agreement unless otherwise
indicated.
1.3 "ArgentBank" means ArgentBank, a state banking
association, duly chartered on February 26, 1929, organized
and existing under and pursuant to the laws of the State of
Louisiana and maintaining its principal place of business at
000 Xxxx 0xx Xxxxxx, Xxxxxxxxx, Xxxxxxxxx Parish, Louisiana.
1.4 "Assumption Bank" means Assumption Bank & Trust
Company, a state banking association duly chartered on
December 19, 1933, organized, and existing under and
pursuant to the laws of the State of Louisiana and
maintaining its principal place of business at 000 Xxxxxxxx
Xxxxxx, Xxxxxxxxxxxxx, Assumption Parish, Louisiana.
1.5 "Business Day" means a day on which ArgentBank is
open for business and which is not a Saturday, Sunday or
legal bank holiday.
1.6 "FDIC" means the Federal Deposit Insurance
Corporation, or any successor United States governmental
agency which insures deposits of commercial banks.
1.7 "FRB" means the Federal Reserve System represented
by actions of its Board of Governors, having regulatory
authority over bank holding companies, or any successor
United States governmental agency performing the function of
exercising such regulatory authority.
1.8 "OFI" means the Office of Financial Institutions
of the State of Louisiana having regulatory authority over
ArgentBank and Assumption Bank or any successor Louisiana
governmental agency exercising such regulatory authority.
1.9 "Party" means ArgentBank, ABI, or Assumption Bank
and "Parties" shall mean ArgentBank, ABI and Assumption
Bank.
1.10 "Person" means any individual, corporation,
partnership, joint venture, association, joint-stock
company, trust, unincorporated organization or government or
any agency or political subdivision thereof.
1.11 "SEC" means the Securities and Exchange
Commission.
2 THE MERGERS AND RELATED MATTERS
2.1 Mergers.
(a) Simultaneously with the execution of this
Agreement, ABI and Assumption Bank have entered into the
Company Merger Agreement in the form attached hereto as
Exhibit A (the "Company Merger Agreement"), pursuant to
which ABI will, subject to the terms and conditions stated
therein and herein, merge into Assumption Bank, which shall
be the surviving association (the "Company Merger").
(b) Simultaneously with the execution of this
Agreement, Assumption Bank and ArgentBank have entered into
the Bank Merger Agreement in the form attached hereto as
Exhibit B (the "Bank Merger Agreement," and, together with
the Company Merger Agreement, the "Merger Agreements"),
pursuant to which Assumption Bank will, subject to the terms
and conditions stated therein and herein, merge into
ArgentBank, which shall be the surviving association (the
"Bank Merger," and, together with the Company Merger, the
"Mergers").
2.2 The Closing.
(a) The closing of the transactions contemplated
herein (the "Closing") will take place, assuming
satisfaction or waiver of each of the conditions set forth
in Article 8 hereof, at the offices of ArgentBank, 000 Xxxx
Xxxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxx 00000, at 10:00 a.m.,
local time, on a mutually agreeable date as soon as
practicable following satisfaction of the conditions set
forth in subparagraphs (a), (b) and (c) of Section 8.1
hereof, or if no date has been agreed to, on any date
specified by any party to the others upon ten business days
notice following satisfaction of such conditions.
(b) At the Closing (i) ABI and Assumption Bank,
on the one hand, and ArgentBank, on the other hand, shall
each provide to the other such proof or other indication of
satisfaction of the conditions set forth in Article 8 as the
party whose obligations are conditioned upon such
satisfaction may reasonably request, (ii) the certificates,
letters and opinions required by Article 8 shall be
delivered, (iii) the appropriate officers of the parties
shall complete the execution, acknowledgment and delivery of
the Merger Agreements and (iv) the parties shall take such
further action as is required to consummate the transactions
contemplated by this Agreement and the Merger Agreements.
2.3 The Effective Date and Time. The Company Merger
Agreement shall be filed and recorded with the Louisiana
Secretary of State and the OFI as provided by law
immediately following (or concurrently with) the Closing,
and the Company Merger will be effective at the time
specified in a certificate or other written record issued by
the OFI. The Bank Merger Agreement shall be filed and
recorded with the OFI as provided by law immediately
following (or concurrently with) the Closing, and the Bank
Merger will be effective at the time specified in a
certificate or other written record issued by the OFI. It
is the intent of the parties that the Company Merger shall
be effected immediately prior to the Bank Merger. The date
on which and the time at which the Bank Merger becomes
effective are herein referred to as the "Effective Date" and
the "Effective Time," respectively.
2.4 Effects of the Mergers. The Company Merger shall
have the effects specified in Section 115 of the Louisiana
Business Corporation Law (the "LBCL") and Section 355 of the
Louisiana Banking Laws (the "Banking Laws") and the Bank
Merger shall have the effects specified in Section 355 of
the Banking Laws.
3 CONVERSION OF STOCK
3.1 Conversion of ABI Stock in Company Merger. On the
Effective Date, by virtue of the Company Merger and without
any action on the part of the holders thereof, each share of
common stock, $5.00 par value, of ABI ("ABI Common Stock")
outstanding immediately prior to the Effective Date shall be
changed and converted into one fully paid and nonassessable
share of common stock, par value $25.00 per share, of
Assumption Bank ("Assumption Bank Common Stock"). All
treasury shares of each of ABI and Assumption Bank and all
issued and outstanding shares of Assumption Bank Common
Stock owned by ABI shall be canceled.
3.2 Conversion of Assumption Bank Common Stock in Bank
Merger.
(a) Subject to Sections 3.2(b) and 3.2(c), on the
Effective Date, by reason of the Bank Merger, each share of
Assumption Bank Common Stock outstanding immediately
following the Company Merger shall, in accordance with the
election made or deemed to have been made by the holder
thereof in accordance with the procedures set forth in
Section 3.3, be converted into (i) that number of shares of
common stock, $.10 par value per share, of ArgentBank
("ArgentBank Common Stock") equal to (x) $21.5 million (the
"Aggregate Merger Consideration Value") divided by the
average of the closing sale prices of a share of ArgentBank
Common Stock on the NASDAQ Stock Market for the forty days
on which the NASDAQ Stock Market is open for trading
preceding the fifth trading day immediately prior to the
Effective Date (the "Average Market Price"), divided by (y)
the number of outstanding shares of Assumption Bank Common
Stock immediately following the Company Merger; provided
that the formula set forth above shall be adjusted to take
into account any change in the number of shares of
ArgentBank Common Stock outstanding as a result of a stock
split or stock dividend (as it may be so adjusted, the
"Conversion Number"), or (ii) the right to receive $134.375
in cash (the "Cash Payment") ((i) and (ii) together, the
"Merger Consideration"); provided that, any holder of 15 or
fewer shares of Assumption Bank Common Stock ("De minimis
Holdings") shall only be entitled to receive a Cash Payment
for such shares, and holders of shares of Assumption Bank
Common Stock as to which dissenter's rights have been
perfected and not withdrawn or otherwise forfeited under
Section 376 of the Banking Laws or Section 131 of the LBCL
shall not receive any shares of ArgentBank Common Stock for
such shares, but shall instead be deemed to have made an
election to receive Cash Payments for all of such shares.
(b) The total Cash Payments that shall be made
hereunder (including (i) the Cash Payments that holders of
Assumption Bank Common Stock have elected, or have been
deemed to have elected pursuant to Section 3.3(b)(i) to
receive ("Elected Cash Payments"), (ii) the Cash Payments
that have been made in exchange for De minimis Holdings,
(iii) the amount of cash paid in lieu of fractional shares
pursuant to Section 3.3(h), and (iv) the amount of cash paid
with respect to shares of Assumption Bank Common Stock
("Dissenting Shares") as to which dissenters rights have
been perfected ("Total Cash Payments")) shall be limited to
a maximum of $10,535,000 (the "Maximum Cash Number") and a
minimum of $7,525,000 (the "Minimum Cash Number").
(c) If the Total Cash Payments payable to holders
of Assumption Bank Common Stock in the aggregate exceed the
Maximum Cash Number, the Available Cash (as defined below)
shall be allocated among such holders pro rata, determined
by multiplying the number of shares for which each holder of
Assumption Bank Common Stock has elected to receive an
Elected Cash Payment times a fraction, the numerator of
which shall be the Maximum Cash Number less the amount of
(i) Cash Payments that must be made in exchange for De
minimis Holdings (ii) cash paid in lieu of fractional shares
and (iii) cash paid with respect to Dissenting Shares, and
the denominator of which shall be the total amount of
Elected Cash Payments that holders of Assumption Bank Common
Stock shall have elected to receive. The aggregate amount
of cash available for all Cash Payments (the "Available
Cash") shall be equal to the Maximum Cash Number. The
number of shares of Assumption Bank Common Stock for which
each holder shall be entitled to an Elected Cash Payment
determined in accordance with the foregoing formula (such
holder's "Pro Rata Share") shall then be multiplied by the
amount of the Cash Payment to determine the total amount of
cash such holder shall be entitled to receive. Each share
of Assumption Bank Common Stock for which the holder has
elected to receive an Elected Cash Payment in excess of such
holder's Pro Rata Share shall be converted into shares of
ArgentBank Common Stock in accordance with the provisions of
Section 3.2(a).
(d) If the Total Cash payments payable to holders
of Assumption Bank Common Stock in the aggregate is less
than the Minimum Cash Number, the Available Shares (as
defined below) shall be allocated to such holders pro rata
determined by multiplying the number of shares for which
each holder of Assumption Bank Common Stock has elected to
receive ArgentBank Common Stock times a fraction, the
numerator of which shall be the Available Shares, and the
denominator shall be the total number of shares of
Assumption Bank Common Stock for which holders have elected
to receive shares of ArgentBank Common Stock. The Available
Shares shall equal 104,000 shares. Each share of Assumption
Bank Common Stock for which the holder has elected to
receive ArgentBank Common Stock in excess of such holder's
pro rata share as determined in accordance with the
foregoing formula shall be converted into Cash Payments in
accordance with the provisions of Section 3.2(a).
3.3 Election Procedures and Exchange of Certificates
Representing Assumption Bank Common Stock.
(a) Prior to or promptly after the Effective
Date, Sun Trust Bank, Atlanta, Georgia, as the exchange
agent (the "Exchange Agent"), will mail (the "Mailing Date")
an election form and other appropriate transmittal materials
as ArgentBank and Assumption Bank shall mutually agree
("Election Form") to each holder of record of Assumption
Bank Common Stock permitting such holder (or in the case of
nominee record holders, the beneficial owner through proper
instructions and documentation) to elect to receive the
number of shares of ArgentBank Common Stock and/or Cash
Payments as such holder desires pursuant to Section 3.2(a).
(b) In making and honoring elections pursuant to
Section 3.2(a), the following rules shall apply:
(i) A shareholder may elect to receive all
cash, all stock or a combination of cash and stock in
exchange for his or her shares of Assumption Bank Common
Stock, subject to the provisions of Section 3.2 hereof. A
shareholder who does not make an election by the Election
Deadline (as defined below) will be deemed to have elected
to receive either shares of ArgentBank Common Stock, or
cash, at the option of ArgentBank, as the sole Merger
Consideration for each of such holder's shares of Assumption
Bank Common Stock.
(ii) The term "Election Deadline" shall mean
5:00 p.m., local time on the 20th day following (but not
including) the Mailing Date or such other date as ArgentBank
and Assumption Bank shall mutually agree upon.
(iii) Any election to receive ArgentBank
Common Stock or Cash Payments shall have been properly made
only if the Exchange Agent shall have actually received a
properly completed election form by the Election Deadline.
An election form will be properly completed only if
accompanied by certificates (or customary affidavits and
indemnities regarding the loss thereof) representing all
shares of Assumption Bank Common Stock covered thereby.
(iv) Any election form may be revoked or
changed by the person submitted such election form to the
Exchange Agent at or prior to the Election Deadline. The
Exchange Agent shall have reasonable discretion to determine
when any election, modification or revocation is received
and whether any such election, modification or revocation
has been properly made.
(v) As soon as practicable after the
Election Deadline, the Exchange Agent shall determine the
allocation of the aggregate Merger Consideration among Cash
Payments and ArgentBank Common Stock in accordance with
Section 3.2, and shall notify ArgentBank of its
determination.
(c) Within five (5) business days after the
allocations described above, the Exchange Agent shall
distribute ArgentBank Common Stock and/or Cash Payments as
provided herein. The Exchange Agent shall not be entitled
to vote or exercise any rights of ownership with respect to
the shares of ArgentBank Common Stock held by it from time
to time hereunder, except that it shall receive and hold all
dividends or other distributions paid or distributed with
respect to such shares for the account of the persons
entitled thereto.
(d) After the completion of the foregoing
allocation, each holder of an outstanding certificate or
certificates which prior thereto represented shares of
Assumption Bank Common Stock who surrendered such
certificate or certificates to the Exchange Agent will, upon
acceptance thereof by the Exchange Agent, be entitled to a
certificate or certificates representing the number of full
shares of ArgentBank Common Stock and/or the amount of Cash
Payments into which the aggregate number of shares of
Assumption Bank Common Stock previously represented by such
certificate or certificates surrendered shall have been
converted pursuant to this Agreement and, if such holder's
shares of Assumption Bank Common Stock have been converted
into ArgentBank Common Stock, any other distribution
theretofore paid with respect to the ArgentBank Common Stock
issuable in the Bank Merger, in each case without interest.
The Exchange Agent shall accept such certificates upon
compliance with such reasonable terms and conditions as the
Exchange Agent may impose to effect an orderly exchange
thereof in accordance with normal exchange practices. Each
outstanding certificate which prior to the Effective Date of
the Bank Merger represented Assumption Bank Common Stock and
which is not surrendered to the Exchange Agent in accordance
with the procedures provided for herein shall, except as
otherwise herein provided, until duly surrendered to the
Exchange Agent be deemed to evidence ownership of the number
of shares of ArgentBank Common Stock and/or the right to
receive the amount of Cash Payments into which such
Assumption Bank Common Stock shall have been converted.
(e) After the Effective Date, there shall be no
further transfer on the records of Assumption Bank of
certificates representing Assumption Bank Common Stock and
if such certificates are presented to Assumption Bank for
transfer, they shall be cancelled against delivery of
certificates of ArgentBank Common Stock and/or Cash Payments
as hereinabove provided. Certificates surrendered for
exchange by any person constituting an "affiliate" of ABI or
Assumption Bank for purposes of Rule 145(c) under the
Securities Act of 1933 (the "Securities Act") shall not be
exchanged until ArgentBank has received a written agreement
from such person as provided in Section 7.8 hereof. No
dividends which have been declared will be remitted to any
person entitled to receive shares of ArgentBank Common Stock
under this Article III until such person surrenders the
certificate or certificates representing Assumption Bank
Common Stock, at which time such dividends shall be remitted
to such person, without interest.
(f) Neither the Exchange Agent nor any party to
this Agreement shall be liable to any former holder of
shares of ABI Common Stock or Assumption Bank Common Stock
for any amount properly delivered to a public official
pursuant to applicable abandoned property, escheat or
similar laws. ArgentBank and the Exchange Agent shall be
entitled to rely upon the stock transfer books of ABI and
Assumption Bank to establish the identity of those persons
entitled to receive the Merger Consideration specified in
this Agreement, which book shall be conclusive with respect
thereto. In the event of a dispute with respect to
ownership of stock, ArgentBank and the Exchange Agent shall
be entitled to deposit any Merger Consideration represented
thereby in escrow with an independent third party and
thereafter be relieved with respect to any claims thereto.
(g) In the event any Certificate shall have been
lost, stolen or destroyed, upon the making of an affidavit
of that fact by the person claiming such Certificate to be
lost, stolen or destroyed and, if required by ArgentBank,
the posting by such person of a bond in such reasonable
amount as ArgentBank may direct as indemnity against any
claim that may be made against it with respect to such
Certificate, the Exchange Agent will issue in exchange for
such lost, stolen or destroyed Certificate the shares of
ArgentBank Common Stock and/or cash, as appropriate, and
cash in lieu of fractional shares, and unpaid dividends and
distributions on shares of ArgentBank Common Stock as
provided above, deliverable in respect thereof pursuant to
this Agreement.
(h) No certificates or scrip representing
fractional shares of ArgentBank Common Stock shall be issued
upon the surrender for exchange of certificates for
Assumption Bank Common Stock. In lieu of the issuance of
any fractional share of ArgentBank Common Stock to which a
holder of Assumption Bank Common Stock may be entitled
(after aggregation of all fractional shares to which such
holder is entitled) each such holder of Assumption Bank
Common Stock shall be entitled to receive an amount in cash
(without interest) equal to such fractional share multiplied
by the Average Market Price as determined in accordance with
Section 3.2(a) hereof.
4 ACCOUNTING AND TAX MATTERS
4.1 Accounting Treatment. It is intended by the
Parties hereto, that the Mergers will qualify for purchase
accounting treatment under general accepted accounting
principles.
4.2 Tax Treatment. It is intended that the Mergers
will qualify as a reorganization within the meaning of
Section 368 of the Internal Revenue Code of 1986, as amended
(the "Code") for federal income tax purposes.
4.3 Accounting and Tax Representations. Each Party
hereto represents and warrants that the statements made with
respect to it in the Tax Certificates attached hereto on
Exhibit C and made a part hereof, are true and correct as of
the date hereof and will be true and correct on the
Effective Date.
5 REPRESENTATIONS AND WARRANTIES OF ABI AND ASSUMPTION
BANK
ABI and Assumption Bank represent and warrant to
ArgentBank that, except as set forth in the Schedule of
Exceptions attached hereto:
5.1 Organization and Authority. ABI's "Consolidated
Group," as such term is used in this Agreement, consists of
ABI and Assumption Bank. ABI is a corporation duly
organized, validly existing and in good standing under the
laws of the State of Louisiana and is a bank holding company
within the meaning of the Bank Holding Company Act of 1956,
as amended. Assumption Bank is a state chartered bank duly
organized, validly existing and in good standing under the
laws of the State of Louisiana. Each member of ABI's
Consolidated Group has all requisite corporate power and
authority to own and lease its properties and assets and to
carry on its business as it is currently being conducted.
5.2 Authorization. (a) The execution, delivery and
performance of this Agreement by ABI and Assumption Bank and
the consummation of the transactions contemplated hereby
have been duly authorized by the Boards of Directors of ABI
and Assumption Bank. No other corporate proceedings on the
part of ABI or Assumption Bank are necessary to authorize
consummation of this Agreement, except for the approval of
the transaction by ABI's and Assumption Bank's shareholders.
Subject to such shareholder approvals and to such regulatory
approvals as are required by law, and satisfaction of any
conditions imposed in connection therewith, this Agreement
is a valid and binding obligation of ABI and Assumption Bank
enforceable against them in accordance with its terms except
as may be limited by applicable bankruptcy, insolvency,
reorganization or moratorium or other similar laws affecting
creditors' rights generally and except that the availability
of equitable remedies is within the discretion of the
appropriate court.
(b) Neither the execution, delivery or performance of
this Agreement by ABI or Assumption Bank, nor the
consummation of the transactions contemplated hereby, will
(a) in any material respect violate, conflict with, or
result in a breach of any provision of, or constitute a
default (or an event which, with notice or lapse of time or
both, would constitute a default) under or result in the
termination of, or accelerate the performance required by,
or result in a right of termination or acceleration, or the
creation of any lien, security interest, charge or
encumbrance upon any of the properties or assets of ABI or
Assumption Bank under any terms, conditions or provisions of
(i) ABI's or Assumption Bank's Charter or Bylaws or (ii) any
material note, bond, mortgage, indenture, deed of trust,
license, lease, agreement or other instrument or obligation
to which ABI or Assumption Bank is a party or by which ABI
or Assumption Bank may be bound, or (b) violate in any
material respect any judgment, ruling, order, writ,
injunction, decree, statute, rule or regulation applicable
to ABI or Assumption Bank or any of its properties or
assets.
5.3 Capital Structure of ABI. As of the date hereof,
the authorized capital of ABI consists solely of 1,000,000
shares of common stock, $5.00 par value per share, of which
160,000 shares are issued and outstanding and none are held
in treasury. The outstanding shares of capital stock of ABI
are validly issued and outstanding, fully paid and
nonassessable. There are no outstanding options, conversion
rights, warrants, calls, rights, commitments or agreements
to issue any form of stock or other security of ABI, nor any
outstanding obligations or commitments to purchase, redeem
or otherwise acquire any outstanding shares of ABI Common
Stock.
5.4 Ownership of Other Banks. ABI does not own,
directly or indirectly, five percent (5%) or more of the
outstanding capital stock or other voting securities of any
corporation, bank, or other organization except Assumption
Bank. As of the date hereof, the authorized capital of
Assumption Bank consists solely of 45,000 shares of common
stock, $25.00 par value per share, of which one share of
common stock is issued and outstanding. The outstanding
share of capital stock of Assumption Bank is validly issued
and outstanding, fully paid and, nonassessable and, is owned
by ABI, free and clear of all liens, claims and encumbrances
(except as provided in Section 262 of the Banking Laws).
5.5 ABI Financial and Other Reports. ABI has made
available to ArgentBank true and correct copies of (a) the
consolidated balance sheets as of December 31, 1995, 1994
and 1993 of ABI and its consolidated subsidiaries and the
related consolidated statements of income, changes in
shareholders' equity and cash flows for the respective years
then ended, the related notes thereto, and the report of its
independent public accountants with respect thereto (the
"ABI Audited Financial Statements"), (b) the unaudited
balance sheets as of September 30, 1996 and 1995 of ABI and
its consolidated subsidiaries, and the related unaudited
statements of income, changes in shareholders equity and
cash flows for the nine-month periods then ended (the "ABI
Unaudited Financial Statements, and together with the ABI
Audited Financial Statements, the "ABI Financial
Statements"), and (c) all correspondence between any member
of the ABI Consolidated Group and the OFI, the FDIC, the
FRB, the SEC and the Internal Revenue Service since January
1, 1996. The latest balance sheet forming part of the ABI
Unaudited Financial Statements is referred to herein as the
"ABI Latest Balance Sheet." ABI's Financial Statements (i)
have been prepared in accordance with generally accepted
accounting principles, consistently applied, and (ii)
present fairly the consolidated results of operations of the
ABI Consolidated Group for the periods covered thereby and
the consolidated financial condition of the ABI Consolidated
Group as of the dates thereof.
5.6 No Material Adverse Change. Since the date of the
ABI Latest Balance Sheet, there has been no event or
condition of any character (whether actual, or to the
knowledge of ABI or Assumption Bank, threatened or
contemplated) that has had or can reasonably be anticipated
to have a material adverse effect on the financial
condition, results of operations, business or prospects of
ABI or Assumption Bank, excluding changes in laws or
regulations that affect banking institutions generally.
5.7 Tax Liability. The amounts set up as liabilities
for taxes in the ABI Latest Balance Sheet are sufficient for
the payment of all respective taxes (including, without
limitation, federal, state, local, and foreign excise,
franchise, property, payroll, income, capital stock, and
sales and use taxes) accrued in accordance with GAAP and
unpaid at the respective dates thereof.
5.8 Tax Returns: Payment of Taxes. All federal,
state, local, and foreign tax returns (including, without
limitation, estimated tax returns, withholding tax returns
with respect to employees, and FICA and FUTA returns)
required to be filed by or on behalf of ABI or Assumption
Bank have been timely filed or requests for extensions have
been timely filed and granted and have not expired for
periods ending on or before December 31, 1995, and all
returns filed are complete and accurate in all material
respects and all taxes shown on filed returns have been
paid. As of the date hereof, there is no audit,
examination, deficiency or investigations presently being
conducted or, to the best knowledge of ABI and Assumption
Bank, threatened, by any taxing authority and no material
unpaid tax deficiencies or additional liabilities of any
sort have been proposed to ABI or Assumption Bank by any
state or federal governmental representative. All taxes,
interest, additions and penalties due with respect to
completed and settled examinations or concluded litigation
have been paid, and ABI's reserves for bad debts at December
31, 1995, as filed with the Internal Revenue Service were
not greater than the maximum amounts permitted under the
provisions of Section 585 of the Code.
5.9 Litigation and Proceedings. Except as set forth
on Schedule 5.9 hereto, no litigation, proceeding or
controversy before any court or governmental agency is
pending against ABI that in the opinion of its management is
likely to have a material and adverse effect on the
business, results of operations or financial condition of
ABI and Assumption Bank taken as a whole, and, to the best
knowledge of ABI and Assumption Bank, no such litigation,
proceeding or controversy has been threatened or is
contemplated.
5.10 Brokers' or Finders' Fees. Except for the
engagement of Chaffe & Associates, Inc. pursuant to the
engagement letter dated as of May 28, 1996, as amended on
October 8, 1996, a copy of which has been provided to
ArgentBank, no agent, broker, investment banker, investment
or financial advisor or other person acting on behalf of ABI
or Assumption Bank or under their authority is entitled to
any commission, broker's or finder's fee from any of the
Parties hereto in connection with any of the transactions
contemplated by this Agreement. The aggregate amount of
consideration to be paid Chaffe & Associates, Inc. in
connection with the transactions contemplated by this
Agreement shall not exceed $150,000.
5.11 Contingent Liabilities. To the best knowledge of
ABI and Assumption Bank, except as disclosed on Schedule
5.11 hereto or as reflected in the ABI Latest Balance Sheet
and except in the case of Assumption Bank for unfunded loan
commitments made in the ordinary course of business
consistent with past practices, as of the date hereof
neither ABI nor Assumption Bank has any obligation or
liability of any nature (contingent or otherwise) except as
may have been incurred or may have arisen since the date of
the ABI Latest Balance Sheet in the ordinary course of
business consistent with past practices, and that was not
material individually or in the aggregate or could not
reasonably be expected to result in any such material
obligation or liability.
5.12 Title to Assets; Adequate Insurance Coverage.
Except as described on Schedule 5.12:
(a) On the date of the ABI Latest Balance Sheet,
ABI and Assumption Bank had, and except with respect to
assets disposed of for adequate consideration in the
ordinary course of business since such date, now have, good
and merchantable title to all real property and good and
merchantable title to all other material properties and
assets reflected on the ABI Latest Balance Sheet, free and
clear of all mortgages, liens, pledges, restrictions,
security interests, charges and encumbrances of any nature
except for (i) mortgages and encumbrances which secure
indebtedness which is properly reflected on the ABI Latest
Balance Sheet or which secure deposits of public funds as
required by law; (ii) liens for taxes accrued by not yet
payable; (iii) liens arising as a matter of law in the
ordinary course of business with respect to obligations
incurred after the date of the ABI Latest Balance Sheet,
provided that the obligations secured by such liens are not
delinquent or are being contested in good faith; (iv) such
imperfections of title and encumbrances, if any, as do not
materially detract from the value or materially interfere
with the present use of any of such properties or assets or
the potential sale of any such owned properties or assets;
and (v) capital leases and leases, if any, to third parties
for fair and adequate consideration. ABI and Assumption
Bank own, or have valid leasehold interests in, all material
properties and assets, tangible or intangible, used in the
conduct of its business. Any real property and other
material assets held under lease by ABI or Assumption Bank
are held under valid, subsisting and enforceable leases with
such exceptions as are not material and do not interfere
with the use made or proposed to be made by ArgentBank in
such lease of such property.
(b) With respect to each lease of any real
property or a material amount of personal property to which
ABI or Assumption Bank is a party, except for financing
leases in which ABI or Assumption Bank is lessor, (i) such
lease is in full force and effect in accordance with its
terms; (ii) all rents and other monetary amounts that have
been due and payable thereunder have been paid; (iii) there
exists no default or event, occurrence, condition or act
which with the giving of notice, the lapse of time or the
happening of any further event, occurrence, condition or act
would become a default under such lease; and (iv) the
Mergers will not constitute a default or a cause for
termination or modification of such lease.
(c) Neither ABI nor Assumption Bank has any legal
obligation, absolute or contingent, to any other person to
sell or otherwise dispose of any substantial part of its
assets or to sell or dispose of any of its assets except in
the ordinary course of business consistent with past
practices.
(d) ABI and Assumption Bank maintain in force
insurance policies and bonds in such amounts and against
such liabilities and hazards as are considered adequate for
institutions of their size and type operating similar
properties and businesses in the State of Louisiana.
5.13 Deposits. All deposits of Assumption Bank
reflected on the ABI Latest Balance Sheet were created for
good, valuable and adequate consideration in accordance with
prudent business standards and in substantial compliance
with all laws, regulations and rules, and the accounts or
evidence of ownership of accounts are genuine, valid and
enforceable in accordance with their written terms. Neither
ABI nor Assumption Bank has agreed to any modification or
extension of accounts or account terms or otherwise made any
agreements regarding such accounts except as disclosed in
writing on the books and records of Assumption Bank; and ABI
and Assumption Bank have no knowledge of any claim of
ownership to any account other than as shown on the written
ownership records of Assumption Bank for each account, and
ABI and Assumption Bank have no knowledge of any alleged
improper or wrongful withdrawal or payment of any such
account.
5.14 Loans. To the best knowledge of ABI and
Assumption Bank, each loan reflected as an asset of ABI on
the ABI Latest Balance Sheet, (a) was, at the time and under
the circumstances in which made, made for good, valuable and
adequate consideration in the ordinary course of business of
ABI and Assumption Bank, (b) is evidenced by genuine notes,
agreements or other evidence of indebtedness and (c) to the
extent secured, have been secured by valued liens and
security interests which have been perfected. Except as set
forth in Schedule 5.14 hereto, there are no outstanding
loans held by Assumption Bank with an unpaid balance of
$25,000 or more in which a material default has occurred. A
material default for purposes of this Section 5.14 includes,
without limitation, the failure to pay indebtedness or an
installment thereof more than sixty (60) days after it is
due and payable.
5.15 Allowance for Loan Losses. The allowances for
loan losses shown on the ABI Latest Balance Sheet are
adequate in all material respects in accordance with GAAP to
provide for possible losses, net of recoveries, relating to
loans previously charged off, on loans outstanding
(including accrued interest receivable) as of the date of
the ABI Latest Balance Sheet.
5.16 Investments. Except for investments classified as
held-to-maturity as prescribed under the Financial
Accounting Standards Board Statement Number 115, and pledges
to secure public or trust deposits, none of the investments
reflected on the ABI Latest Balance Sheet under the heading
"Investment Securities", and none of the investments made by
ABI or Assumption Bank since such date, and none of the
assets reflected on the ABI Latest Balance Sheet under the
heading "Cash and Due From Assumption Bank," is subject to
any restriction, whether contractual or statutory, that
materially impairs the ability of ABI or Assumption Bank
freely to dispose of such investment at any time. With
respect to all repurchase agreements to which ABI or
Assumption Bank is a party, ABI or Assumption Bank, as the
case may be, has a valid, perfected first lien or security
interest in the government securities or other collateral
securing each such repurchase agreement which equals or
exceeds the amount of debt secured by such collateral under
such agreement.
5.17 Commitments and Contracts. Except as disclosed on
Schedule 5.17 hereto, neither ABI nor Assumption Bank is a
party to any of the following (whether written or oral):
(a) Any employment contract (including any
obligations with respect to severance or termination pay
liabilities or fringe benefits) with any present or former
officer, director, employee or consultant (other than those
which are terminable at will by ABI or Assumption Bank);
(b) Any plan or contract providing for any bonus,
pension, option, deferred compensation, retirement payment,
profit sharing or similar arrangement with respect to any
present or former officer, director, employee or consultant;
or
(c) Any contract not made in the ordinary course
of business containing covenants which limit the ability of
ABI or Assumption Bank to compete in any line of business or
with any person or which involves any restriction of the
geographical area in which, or method by which, ABI or
Assumption Bank may carry on its respective business (other
than as may be required by law or applicable regulatory
authorities).
5.18 Employee Plans. ABI, Assumption Bank, and all
"employee benefit plans", as defined in Section 3(3) of the
Employee Retirement Income Security Act of 1974, as amended
("ERISA"), that cover one or more employees employed by ABI
or Assumption Bank:
(a) is in compliance with all laws, regulations,
reporting and licensing requirements and orders applicable
to such plan or any of its employees (because of such
employee's activities on behalf of it), the breach or
violation of which could have a material and adverse effect
on such business; and
(b) has received no notification from any agency
or department of federal, state or local government or the
staff thereof asserting that any such entity is not in
compliance with any of the statutes, regulations or
ordinances that such governmental authority enforces, or
threatening to revoke any license, franchise, permit or
governmental authorization, and is subject to no agreement
with any such governmental authority with respect to its
assets or business.
5.19 Plan Liability. Except for liabilities to the
Pension Benefit Guaranty Corporation pursuant to Section
4007 of ERISA, all of which have been fully paid, and except
for liabilities to the Internal Revenue Service under
Section 4971 of the Code, all of which have been fully paid,
neither ABI nor Assumption Bank has any liability to the
Pension Benefit Guaranty Corporation or to the Internal
Revenue Service with respect to any pension plan qualified
under Section 401 of the Code.
5.20 Vote Required. The affirmative vote of the
holders of at least two-thirds of the voting power present,
is the only vote of the shareholders of ABI necessary to
approve this Agreement and related transactions contemplated
hereby. The affirmative vote of the holders of at least
two-thirds of the total voting power is the only vote of the
shareholders of Assumption Bank necessary to approve this
Agreement and related transactions contemplated hereby.
5.21 Environmental Matters. (a) To the best knowledge
of each, ABI and Assumption Bank are, and have been, in
compliance with all applicable federal, state and local
laws, regulations, rules and decrees pertaining to pollution
or protection of the environment ("Environmental Laws"),
including without limitation the Comprehensive Environmental
Response, Compensation, and Liability Act, 42 U.S.C. 9601
et seq., the Resource Conservation and Recovery Act, 42
U.S.C. 6901 et seq., the Louisiana Environmental Quality
Act, La. R.S. 30:2001 et seq., or any similar federal, state
or local law, except for such instances of non-compliance
that are not reasonably likely to have, individually or in
the aggregate, a material adverse effect on the financial
condition, results of operations, business or prospects of
ABI and Assumption Bank.
(b) To the best knowledge of each, all property owned,
leased, operated or managed by ABI or Assumption Bank, or in
which ABI or Assumption Bank has any interest, including any
mortgage or security interest ("Business Property"), and all
businesses and operations conducted on any of the Business
Property (whether by ABI or Assumption Bank, a mortgagor, or
any other person), are, and have been, in compliance with
all applicable Environmental Laws, except for such instances
of non-compliance that are not reasonably likely to have,
individually or in the aggregate, a material adverse effect
on the financial condition, results of operations, business
or prospects of ABI or Assumption Bank.
(c) To the best knowledge of each, there is no
judicial, administrative, arbitration or other similar
proceeding pending or threatened before any court,
governmental agency, authority or other forum in which ABI
or Assumption Bank or any prior owner of any Business
Property has been or, with respect to threatened matters, is
threatened to be named as a party relating to (i) alleged
noncompliance with any applicable Environmental Law or (ii)
the release or threatened release into the environment of
any Hazardous Substance (as defined below), and relating to
any of the Business Property, except for such proceedings
pending or threatened that are not reasonably likely to
have, individually or in the aggregate, a material adverse
effect on the financial condition, results of operations,
business or prospects of ABI or Assumption Bank, and to the
knowledge of each there is no reasonable basis for any such
proceeding. The term "Hazardous Substance" means any
pollutant, contaminant, or toxic or hazardous substance,
chemical, or waste defined, listed or regulated by an
Environmental Law (and specifically shall include, but not
be limited to, asbestos, polychlorinated biphenyls, and
petroleum and petroleum products).
(d) To the best knowledge of each, there has been no
release or threatened release of a Hazardous Substance in,
on, under, or affecting any of its Business Property, except
such release or threatened release that is not reasonably
likely to have, individually or in the aggregate, a material
adverse effect on the financial condition, results of
operations, business or prospects of ABI or Assumption Bank.
5.22 Accuracy of Information. To the best of ABI's and
its officers' and directors' knowledge, all information
furnished by ABI or Assumption Bank to ArgentBank pursuant
to this Agreement is accurate, and ABI has not omitted to
disclose any information which is or would be material to
this Agreement.
5.23 Compliance with Laws and Contracts. To the best
of ABI's and its officers' and directors' knowledge, neither
ABI nor Assumption Bank is in violation in any material
respect of any laws, regulations, or agreements to which it
is a party nor has either failed to file any material
reports required by any governmental or other regulatory
body.
5.24 Information for Registration and Proxy Statements.
None of the information supplied or to be supplied by ABI's
Consolidated Group for inclusion in the Registration
Statement, Proxy Statement or any other documents to be
filed with the FDIC or any regulatory agency in connection
with the transactions contemplated hereby will, as amended
or supplemented at the time the Registration Statement
becomes effective, at the time the Proxy Statement is mailed
to ABI and ArgentBank shareholders, and at the time of
filing of such other documents, respectively, contain any
untrue statement of a material fact or omit to state a
material fact required to be stated therein in order to make
the statements therein, in light of the circumstances under
which they were made, not misleading. All documents,
financial statements, or other information or materials
which ABI's Consolidated Group shall provide for filing with
the FDIC and any regulatory agency in connection with the
Mergers will comply with generally accepted accounting
principles.
6 ARGENTBANK'S REPRESENTATIONS AND WARRANTIES
ArgentBank represents and warrants to ABI that, except
as set forth in the Schedule of Exceptions attached hereto:
6.1 Organization and Authority. ArgentBank is a state
chartered bank duly incorporated, validly existing and in
good standing under the laws of the State of Louisiana and
has the corporate power and authority to own and lease its
properties and assets and to carry on its business as it is
currently being conducted.
6.2 Authorization. (a) The execution, delivery and
performance of this Agreement by ArgentBank and the
consummation of the transactions contemplated hereby have
been duly authorized by the Board of Directors of
ArgentBank. No other corporate proceedings on the part of
ArgentBank are necessary to authorize consummation of this
Agreement except for the approval of the Agreement by
ArgentBank's shareholders. Subject to such shareholder
approval and to such regulatory approvals as are required by
law, and satisfaction of any conditions imposed in
connection therewith, this Agreement is a valid and binding
obligation of ArgentBank enforceable against ArgentBank in
accordance with its terms except as may be limited by
applicable bankruptcy, insolvency, reorganization or
moratorium or other similar laws affecting creditors' rights
generally and except that the availability of equitable
remedies is within the discretion of the appropriate court.
(b) Neither the execution, delivery or performance of
this Agreement by ArgentBank, nor the consummation of the
transactions contemplated hereby, will (a) in any material
respect violate, conflict with, or result in a breach of any
provision of, or constitute a default (or an event which,
with notice or lapse of time or both, would constitute a
default) under or result in the termination of, or
accelerate the performance required by, or result in a right
of termination or acceleration, or the creation of any lien,
security interest, charge or encumbrance upon any of the
properties or assets of ArgentBank under any terms,
conditions or provisions of (i) ArgentBank's Charter or
Bylaws or (ii) any material note, bond, mortgage, indenture,
deed of trust, license, lease, agreement or other instrument
or obligation to which ArgentBank is a party or by which
ArgentBank may be bound, or (b) violate in any material
respect any judgment, ruling, order, writ, injunction,
decree, statute, rule or regulation applicable to ArgentBank
or any of its properties or assets.
6.3 Capital Structure of ArgentBank. As of the date
hereof, the authorized capital of ArgentBank consists solely
of 10,000,000 shares of common stock, $0.10 par value per
share, of which 5,863,668 shares are issued and outstanding
and none are held in treasury. The outstanding shares of
capital stock of ArgentBank are validly issued and
outstanding, fully paid and nonassessable. The shares of
ArgentBank Common Stock to be issued in connection with the
Bank Merger pursuant to this Agreement have been duly
authorized and, when issued in accordance with the terms of
this Agreement, will be validly issued, fully paid, and
nonassessable; and free and clear of all liens, claims and
encumbrances, or any preemptive or similar rights (except as
provided in Section 262 of the Banking Laws).
6.4 ArgentBank Financial and Other Reports.
ArgentBank has made available to ABI true and correct copies
of (a) the balance sheets as of December 31, 1995, 1994 and
1993 of ArgentBank and the related statements of income,
changes in shareholders' equity and cash flows for the
respective years then ended, the related notes thereto, and
the report of its independent public accountants with
respect thereto (the "ArgentBank Audited Financial
Statements"), (b) the unaudited balance sheets as of
September 30, 1996 and 1995 of ArgentBank and the related
unaudited statements of income, changes in shareholders
equity and cash flows for the nine-month periods then ended
(the "ArgentBank Unaudited Financial Statements, and
together with the ArgentBank Audited Financial Statements,
the "ArgentBank Financial Statements"), and (c) all
correspondence between ArgentBank and the OFI, the FDIC, the
SEC and the Internal Revenue Service since January 1, 1996.
The latest balance sheet forming part of the ArgentBank
Unaudited Financial Statements is referred to herein as the
"ArgentBank Latest Balance Sheet." ArgentBank`s Financial
Statements (i) have been prepared in accordance with
generally accepted accounting principles, consistently
applied, and (ii) present fairly the results of operations
of ArgentBank for the periods covered thereby and the
financial condition of ArgentBank as of the dates thereof.
6.5 No Material Adverse Change. Since September 30,
1996, there has been no event or condition of any character
(whether actual, or to the knowledge of ArgentBank,
threatened or contemplated) that has had or can reasonably
be anticipated to have a material adverse effect on the
financial condition, results of operations, business or
prospects of ArgentBank excluding changes in laws or
regulations that affect banking institutions generally.
6.6 Loans. To the best knowledge of ArgentBank, each
loan reflected as an asset of ArgentBank on the unaudited
balance sheet as of September 30, 1996 of ArgentBank (the
"ArgentBank Latest Balance Sheet") (a) was, at the time and
under the circumstances in which made, made for good,
valuable and adequate consideration in the ordinary course
of business of ArgentBank, (b) is evidenced by genuine
notes, agreements or other evidence of indebtedness and (c)
to the extent secured, have been secured by valued liens and
security interests which have been perfected.
6.7 Litigation. Except as disclosed on Schedule 6.7
hereto, no litigation, proceeding or controversy before any
court or governmental agency is pending that in the opinion
of its management is likely to have a material and adverse
effect on the business, results of operations or financial
condition of ArgentBank and its subsidiaries taken as a
whole, and, to the best knowledge of ArgentBank, no such
litigation, proceeding or controversy has been threatened or
is contemplated.
6.8 Contingent Liabilities. To the best knowledge of
ArgentBank, except as disclosed on Schedule 6.8 hereto or as
reflected in the ArgentBank Latest Balance Sheet and for
unfunded loan commitments made in the ordinary course of
business consistent with past practices, as of the date
hereof ArgentBank has no obligation or liability of any
nature (contingent or otherwise) except as may have been
incurred or may have arisen since the date of the ArgentBank
Latest Balance Sheet in the ordinary course of business
consistent with past practices, that was not material
individually or in the aggregate or could not reasonably be
expected to result in any such material obligation or
liability.
6.9 Allowances for Loan Losses. The allowances for
loan losses shown on the ArgentBank Latest Balance Sheet are
adequate in all material respects in accordance with GAAP to
provide for possible losses, net of recoveries, relating to
loans previously charged off, on loans outstanding
(including accrued interest receivable) as of the date of
the ArgentBank Latest Balance Sheet.
6.10 Employee Plans. ArgentBank, each of its
subsidiaries and all "employee benefit plans," as defined in
Section 3(3) of ERISA, that cover one or more employees
employed by ArgentBank or any of its subsidiaries:
(a) is in compliance with all laws, regulations,
reporting and licensing requirements and orders applicable
to such plan or any of its employees (because of such
employee's activities on behalf of it), the breach or
violation of which could have a material and adverse effect
on such business; and
(b) has received no notification from any agency
or department of federal, state or local government or the
staff thereof asserting that any such entity is not in
compliance with any of the statutes; regulations or
ordinances that such governmental authority enforces, or
threatening to revoke any license, franchise or permit or
governmental authorization, and is subject to no agreement
or written understanding with any such governmental
authorities with respect to its assets or business.
6.11 Vote Required. The affirmative vote of the
holders of at least two-thirds of the voting power present
is the only vote of the shareholders of ArgentBank necessary
to approve the Bank Merger and related transactions
contemplated hereby.
6.12 Accuracy of Information. To the best of
ArgentBank's and its officers' and directors' knowledge, all
information furnished by ArgentBank to ABI and Assumption
Bank pursuant to this Agreement is accurate, and ArgentBank
has not omitted to disclose any information which is or
would be material to this Agreement.
6.13 Information for Registration and Proxy Statements.
None of the information supplied or to be supplied by
ArgentBank for inclusion in the Registration Statement,
Proxy Statement or any other documents to be filed with the
FDIC or any regulatory agency in connection with the
transactions contemplated hereby will, as amended or
supplemented at the time the Registration Statement becomes
effective, at the time the Proxy Statement is mailed to ABI
and ArgentBank shareholders, and at the time of filing of
such other documents, respectively, contain any untrue
statement of a material fact or omit to state a material
fact required to be stated therein in order to make the
statements therein, in light of the circumstances under
which they were made, not misleading. All documents,
financial statements, or other information or materials
which ArgentBank shall provide for filing with the FDIC and
any regulatory agency in connection with the Mergers will
comply with generally accepted accounting principles.
7 COVENANTS OF THE PARTIES
7.1 Operation of Business. Between the date hereof
and the Effective Date, or until the termination of this
Agreement, each member of the ABI Consolidated Group
covenants and agrees that it will operate its business
solely in the ordinary course consistent with prudent
business practices and in compliance with all applicable
laws, regulations and rules; and without the prior written
consent of ArgentBank, it will not:
(a) Amend or otherwise change its respective
articles of incorporation or bylaws, as each such document
is in effect on the date hereof;
(b) Issue or sell, or authorize for issuance or
sale, the shares of ABI or Assumption Bank or any additional
shares of any class of capital stock of ABI or Assumption
Bank (except to the extent required in order to effect the
Company Merger or the Bank Merger as contemplated herein);
(c) Issue, grant, or enter into any subscription,
option, warrant, right, convertible security, or other
agreement or commitment of any character obligating ABI or
Assumption Bank to issue securities;
(d) Declare, set aside, make, or pay any dividend
or other distribution with respect to its capital stock
except for (i) dividends on ABI Common Stock to be payable
in December 1996 for fiscal 1996 not exceeding $1.10 per
share and corresponding dividends on Assumption Bank Common
Stock, and (ii) if the closing shall not have occurred by
June 30, 1997, dividends for fiscal 1997 in accordance with
ABI's past practices and corresponding dividends on
Assumption Bank Common Stock;
(e) Redeem, purchase, or otherwise acquire,
directly or indirectly, any of its capital stock
respectively;
(f) Authorize any capital expenditure(s) which,
individually or in the aggregate, exceed $20,000;
(g) Extend any new loan, credit, lease, or other
type of financing which individually exceeds $100,000 or
renew any such type of financing which individually exceeds
$150,000 and does not meet Assumption Bank's loan policy
requirements;
(h) Except in the ordinary course of business,
sell, pledge, dispose of, or encumber, or agree to sell,
pledge, dispose of, or encumber, any assets of ABI or
Assumption Bank; provided, however, any investments in
Assumption Bank's securities portfolio which mature prior to
the Effective Date shall be invested in U.S. Treasury
securities with a maturity of two (2) years or less;
(i) Excluding normal and customary banking
transactions, incur any indebtedness for borrowed money,
issue any debt securities, or enter into or modify any
contract, agreement, commitment, or arrangement with respect
thereto;
(j) Impose, or suffer the imposition, on any
share of Assumption Bank Common Stock held by ABI, of any
material lien, charge, or encumbrance, or permit any such
lien to exist;
(k) Establish or add any automated teller
machines or branch or other banking offices;
(l) Acquire (by merger, consolidation, lease or
other acquisition of stock, ownership interests or assets)
any corporation, partnership, or other business organization
or division thereof, or enter into any contract, agreement,
commitment, or arrangement with respect to any of the
foregoing except to the extent required in order to effect
the Mergers as contemplated herein and except in the
ordinary course of business in connection with foreclosures
or similar actions;
(m) Enter into, extend, or renew any lease for
office or other space;
(n) Except as required by law, enter into, adopt
or amend any bonus, profit sharing, compensation, stock
option, pension, retirement, deferred compensation,
employment, or other employee benefit plan, agreement,
trust, fund, or arrangement for the benefit or welfare of
any officer, employee or representative of ABI or Assumption
Bank except for the payment by Assumption Bank of fiscal
1996 year-end bonuses to its employees consistent with past
practices and not to exceed in the aggregate $50,000;
(a) Grant any increase in compensation to any
director, officer, or employee or representative of ABI or
Assumption Bank except in the ordinary course of business
consistent with past practice;
(a) Take any action with respect to the grant or
payment of any severance or termination pay;
(a) Take any action or omit to take any action
which would cause any of ABI's or Assumption Bank's
representations or warranties to be untrue or misleading in
any material respect or any covenant of ABI or Assumption
Bank under this Agreement incapable of being performed; or
(a) Agree in writing or otherwise to do any of
the foregoing.
7.2 Preservation of Business. Between the date hereof
and the Effective Date, ABI will, and will cause Assumption
Bank to, use its best efforts to preserve its existing
business and to keep its business organization intact,
including its present relationships with its employees and
customers and others having business relations with it.
7.3 Insurance. Pending the Closing, each of ABI and
Assumption Bank shall maintain in effect its current
insurance policies and bonds.
7.4 ABI Shareholder Approval. ABI will (i) take all
steps necessary to call, give notice of, convene and hold a
special meeting of its shareholders as soon as practicable
for the purpose of approving this Agreement, the Merger
Agreements and the transactions contemplated hereby and for
such other purposes as may be necessary or desirable, and
(ii) cooperate and consult with ArgentBank with respect to
each of the foregoing matters. ABI, as the sole shareholder
of Assumption Bank, shall approve this Agreement and the
Company Merger Agreement.
7.5 Property Transfers. At the Closing or from time
to time following the Closing, as and when requested by
ArgentBank and to the extent permitted by Louisiana law, the
officers and directors of ABI and Assumption Bank last in
office shall execute and deliver such deeds and other
instruments and shall take or cause to be taken such further
or other actions as shall be necessary in order to vest or
perfect in or to confirm of record or otherwise to
ArgentBank title to, and possession of, all the property,
interests, assets, rights, privileges, immunities, powers,
franchises, and authorities of ABI and Assumption Bank, and
otherwise to carry out the purposes of this Agreement.
7.6 Argent Due Diligence.
(a) In order to afford ArgentBank access to such
information as it may reasonably deem necessary to perform
any due diligence review with respect to ABI and Assumption
Bank, each of ABI and Assumption Bank shall, upon reasonable
notice, afford ArgentBank and its officers, employees,
counsel, accountants, and other authorized representatives
access, during normal business hours throughout the period
prior to the Effective Date, to all of its properties,
books, contracts, commitments, loan files, litigation files
and records (including, but not limited to, the minutes of
the Boards of Directors of ABI and Assumption Bank and all
committees thereof), and to the extent consistent with
applicable law, furnish promptly to ArgentBank such
information as ArgentBank may reasonably request to perform
such review. No member of the ABI Consolidated Group shall
be required to provide access to or to disclose information
where such access or disclosure would violate or prejudice
the rights of any customer or other person, would jeopardize
the attorney-client privilege of the institution in
possession or control of such information, or would
contravene any law, rule, regulation, order, judgment,
decree or binding agreement. The parties will make
appropriate substitute disclosure arrangements under
circumstances in which the restrictions of the preceding
sentence apply.
(b) All information furnished by any member of
the ABI Consolidated Group shall be treated as the sole
property of the party furnishing the information until
consummation of the Mergers contemplated hereby. If this
Agreement is terminated prior to the Effective Date,
ArgentBank shall return, without retaining copies thereof,
all confidential or non-public documents, work papers and
other materials obtained from ABI's Consolidated Group or
their employees, agents or representatives, in connection
with the transactions contemplated hereby and shall destroy
any work papers, analyses or other materials prepared based
on such information, and for a period of two years following
such termination ArgentBank shall use its best efforts to
keep such information confidential, not disclose such
information to any other person or entity except as may be
required by law, and not use such information (including any
work papers, analyses and other materials prepared by it in
reliance upon such information) in its business for any
competitive or other commercial purpose and shall use its
best efforts to cause its employees, agents and
representatives to do the same, provided, however, the
obligation to keep such information confidential shall not
apply to any information which (a) ArgentBank can establish
by convincing evidence was already in its possession prior
to the disclosure thereof by ABI or Assumption Bank, (b) was
then generally in the public domain through no fault of
ArgentBank, or (c) was disclosed to the party receiving the
information by a third party not bound by an obligation of
confidentiality.
7.7 No Solicitation. Prior to the Effective Date,
neither ABI nor Assumption Bank shall authorize or knowingly
permit any of their officers, directors, employees,
representatives, agents or other persons controlled by ABI
or Assumption Bank to directly or indirectly, solicit or
initiate inquiries or proposals with respect to, or, hold
any discussions or negotiations with, or provide any
information to, any persons, entity or group concerning any
merger, consolidation, sale of substantial assets, sale of
shares of capital stock or similar transactions involving,
directly or indirectly, ABI or Assumption Bank except as
contemplated by this Agreement; provided, however, that
nothing contained in this Agreement shall be deemed to
prohibit any officer or director of ABI or Assumption Bank
from taking any action that counsel to ABI or Assumption
Bank has advised in writing is required to discharge his or
her fiduciary duties to ABI or Assumption Bank or their
shareholders, a copy of which advise shall be furnished to
AgentBank. ABI and Assumption Bank shall instruct each
officer, director, employee, agent, representative or
affiliate of it to refrain from doing any of the above, and
ABI and Assumption Bank shall immediately notify ArgentBank
of the identity and terms of any such inquiries or proposals
received by, or if any such negotiations or discussions are
sought to be initiated with, ABI or Assumption Bank.
7.8 Affiliates. ABI, Assumption Bank and ArgentBank
shall cooperate and use their best efforts to identify those
persons who may be deemed to be "affiliates" of ABI or
Assumption Bank within the meaning of Rule 145(c) or Rule
144 (as applicable) under the Securities Act. ABI and
Assumption Bank shall use its best efforts to cause each
person so identified to deliver to ArgentBank, not later
than thirty (30) days prior to the Effective Date, a written
agreement in substantially the form set forth in Exhibit D
attached hereto.
7.9 Conduct of Business. ArgentBank agrees to operate
its business solely in the ordinary course consistent with
prudent business practices and in compliance with all
applicable laws, regulations, and rules; but nothing herein
shall be construed as limiting or restricting ArgentBank in
its assets, liability, or capital structure or limiting any
action of ArgentBank or its affiliates, nor shall anything
in this Agreement be construed as limiting the future number
and amount of outstanding shares of ArgentBank stock pending
consummation of the transactions contemplated hereby;
provided however, that ArgentBank shall not, and shall
instruct its executive officers, directors, and control
persons and any affiliates of any of the foregoing not to,
effect any transactions in ArgentBank Common Stock in
violation of Rule 10b-6 of the Securities Exchange Act of
1934, as amended (the "Exchange Act") or otherwise for the
purpose, or with the effect, of manipulating the trading
price of Argent Bank Common Stock.
7.10 ABI and Assumption Bank Due Diligence.
(a) In order to afford ABI and Assumption Bank
access to such information as it may reasonably deem
necessary to perform any due diligence review with respect
to ArgentBank, ArgentBank shall, upon reasonable notice,
afford ABI and Assumption Bank and their officers,
employees, counsel, accountants, and other authorized
representatives access, during normal business hours
throughout the period prior to the Effective Date, to all of
its properties, books, contracts, commitments, loan files,
litigation files and records (including, but not limited to,
the minutes of the Board of Directors of ArgentBank and all
committees thereof), and to the extent consistent with
applicable law, furnish promptly to ABI and Assumption Bank
such information as ABI and Assumption Bank may reasonably
request to perform such review. ArgentBank shall not be
required to provide access to or to disclose information
where such access or disclosure would violate or prejudice
the rights of any customer or other person, would jeopardize
the attorney-client privilege of the institution in
possession or control of such information, or would
contravene any law, rule, regulation, order, judgment,
decree or binding agreement. The parties will make
appropriate substitute disclosure arrangements under
circumstances in which the restrictions of the preceding
sentence apply.
(b) All information furnished by ArgentBank shall
be treated as the sole property of the party furnishing the
information until consummation of the Mergers contemplated
hereby. If this Agreement is terminated prior to the
Effective Date, ABI and Assumption Bank shall return,
without retaining copies thereof, all confidential or non-
public documents, work papers and other materials obtained
from ArgentBank or its employees, agents or representatives,
in connection with the transactions contemplated hereby and
shall destroy any work papers, analyses or other materials
prepared based on such information, and for a period of two
years following such termination ABI and Assumption Bank
shall use their best efforts to keep such information
confidential, not disclose such information to any other
person or entity except as may be required by law, and not
use such information (including any work papers, analyses
and other materials prepared by it in reliance upon such
information) in its business for any competitive or other
commercial purpose and shall use their best efforts to cause
its employees, agents and representatives to do the same,
provided, however, the obligation to keep such information
confidential shall not apply to any information which
(a) ABI and Assumption Bank can establish by convincing
evidence was already in its possession prior to the
disclosure thereof by ArgentBank, (b) was then generally in
the public domain through no fault of ABI and Assumption
Bank, or (c) was disclosed to the party receiving the
information by a third party not bound by an obligation of
confidentiality.
7.11 Regulatory Matters.
(a) ArgentBank shall prepare and file a
registration statement with the securities and corporate
practices division of the FDIC (the "Registration
Statement"), including a joint proxy statement (the "Proxy
Statement") to be filed with the SEC and mailed to the ABI
and ArgentBank shareholders in connection with the meetings
to be called to consider this Agreement and the Merger
Agreements, as soon as reasonably practicable following the
date of this Agreement. The Registration Statement shall
comply in all material respects with the requirements of the
Securities Act, the rules and regulations promulgated
thereunder and other applicable federal and state laws and
ArgentBank will use its best efforts to cause the
Registration Statement to be declared effective as soon as
practicable, to qualify the ArgentBank Common Stock under
the securities or blue sky laws of such jurisdictions as may
be required and to keep the Registration Statement and such
qualifications current and in effect for so long as is
necessary to consummate the transactions contemplated
hereby.
(b) ArgentBank will use its best efforts to
prepare all necessary documentation, to effect all necessary
filings and to obtain all necessary permits, consents,
approvals and authorizations of all third parties and
governmental bodies necessary to consummate the transactions
contemplated by this Agreement, including those required by
the FDIC, the FRB and the OFI.
(c) ABI's Consolidated Group shall cooperate in
preparing the Registration Statement and the Proxy
Statement, and will promptly furnish all such data and
information relating to it as ArgentBank may reasonably
request for the purpose of including such data and
information in the Registration Statement.
(d) ArgentBank will indemnify and hold harmless
each member of the ABI Consolidated Group, each of its
directors, each of its officers and each person, if any, who
controls ABI within the meaning of the Securities Act
against any losses, claims, damages or liabilities, joint,
several or solidary, to which they or any of them may become
subject, under the Securities Act, any state securities or
blue sky laws, or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise
out of or are based upon an untrue statement or alleged
untrue statement of a material fact contained in the
Registration Statement, or in any amendment or supplement
thereto, or the omission or alleged omission to state
therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, and
will reimburse each such person for any legal or other
expenses reasonably incurred, promptly as they are incurred,
by such person in connection with investigating or defending
any such action or claim; provided, however, that ArgentBank
shall not be liable in any case to the extent that any such
loss, claim, damage or liability (or action in respect
thereof) arises out of or is based upon any untrue statement
or alleged untrue statement or omission or alleged omission
made in the Registration Statement or any such amendment or
supplement in reliance upon or in conformity with
information furnished to ArgentBank by or on behalf of the
ABI Consolidated Group for use therein.
(e) Promptly after receipt by an indemnified
party under subparagraph (d) above of notice of the
commencement of any action, such indemnified party shall, if
a claim in respect thereof is to be made against ArgentBank
under such subparagraph, notify ArgentBank in writing of the
commencement thereof. In case any such action shall be
brought against any indemnified party and it shall notify
ArgentBank of the commencement thereof, ArgentBank shall be
entitled to participate therein and, to the extent that it
shall wish, to assume the defense thereof, with counsel
satisfactory to such indemnified party, and, after notice
from ArgentBank to such indemnified party of its election so
to assume the defense thereof, ArgentBank shall not be
liable to such indemnified party under such subparagraph for
any legal expenses of other counsel or any other expenses
subsequently incurred by such indemnified party; provided,
however, if ArgentBank elects not to assume such defense or
counsel for the indemnified parties advises in writing that
there are material substantive issues which raise conflicts
of interest between ArgentBank or ABI and one or more of the
indemnified parties, such indemnified parties may retain
counsel satisfactory to them, and ArgentBank shall pay all
reasonable fees and expenses of such counsel for the
indemnified parties promptly as statements therefor are
received.
7.12 ArgentBank Shareholder Approval. ArgentBank will
(i) take all steps necessary to call, give notice of,
convene and hold a special meeting of its shareholders as
soon as practicable for the purpose of approving this
Agreement, the Bank Merger Agreement and the transactions
contemplated hereby and for such other purposes as may be
necessary or desirable, and (ii) cooperate and consult with
ABI with respect to each of the foregoing matters.
7.13 Continuity of Business Enterprise. It is the
present intention of ArgentBank to continue at least one
significant historic business line of Assumption Bank,
namely, financial services, and to use at least a
significant portion of Assumption Bank's historic business
assets in a business within the meaning of Treasury
Regulation Section 1.368-1(d).
7.14 Election of Directors. For a period of not less
than two (2) years after the Effective Date, ArgentBank
shall nominate and recommend at least one (1) former member
of the Board of Directors of Assumption Bank to serve as
director of ArgentBank.
7.15 Indemnification and Liability Insurance.
(a) From and after the Effective Date, ArgentBank
shall indemnify, defend, and hold harmless the former
directors, officers, employees and agents of ABI (each such
director, officer, employee or agent referred to as an "ABI
Indemnified Party") against all losses, claims, damages or
liabilities, joint, several or solidary, and any action or
other proceeding in respect thereof, to which the ABI
Indemnified Parties or any of them become subject, arising
out of actions or omissions occurring at or prior to the
Effective Date (including the transactions contemplated by
this Agreement) to the full extent permitted under Louisiana
Law or by ABI's Articles of Incorporation and Bylaws as in
effect on the date hereof. ArgentBank further agrees to
honor the indemnity agreements between ABI or Assumption
Bank and each of the individuals listed on Schedule 7.15(a)
hereto.
(b) From and after the Effective Date, ArgentBank
shall indemnify, defend, and hold harmless the former
directors, officers, employees and agents of Assumption Bank
(each such director, officer, employee or agent referred to
as an "Assumption Bank Indemnified Party") against all
losses, claims, damages or liabilities, joint, several or
solidary, and any action or other proceeding in respect
thereof, to which Assumption Bank Indemnified Parties or any
of them become subject, arising out of actions or omissions
occurring at or prior to the Effective Date (including the
transactions contemplated by this Agreement) to the full
extent permitted under Louisiana Law or by Assumption Bank's
Articles of Incorporation and Bylaws as in effect on the
date hereof.
(c) ABI shall pay the insurance premium required
for an extension of the existing directors and officer's
liability insurance policy of ABI and Assumption Bank,
respectively, covering persons who are currently covered by
such insurance for a "discovery" period of three (3) years
after the Effective Date on terms generally no less
favorable than those in effect on the date of this
Agreement, provided the total of such premium shall not
exceed $24,675.
7.16 Employees. ArgentBank shall not be obligated to
retain in any capacity any of ABI's or Assumption Bank's
officers, directors, or employees or to pay any stipulated
compensation to any employees. ArgentBank shall employ Xx.
Xxxxxx X. Xxxxxxx for the term, and subject to the
provisions, set forth on Exhibit E. If within nine months
following the Effective Date, ArgentBank terminates the
employment without cause, or relocates to an office more
than 40 miles from the place of such person's employment on
the Effective Date, or reduces to less than 30 hours per
week the working hours, of any former employee of ABI or
Assumption Bank and such former employee thereafter resigns,
ArgentBank shall pay such person severance benefits in
accordance with Schedule 7.16(a) hereof, and in amounts
based on such person's salary on the Effective Date.
ArgentBank will make reasonable efforts to maintain
compensation levels for any retained personnel commensurate
with the employees' experience and qualifications, and
in accordance with ArgentBank's salary administration
program. With regard to any retained employee, ArgentBank
shall be free of any obligation to honor any past agreement
of ABI or Assumption Bank to such person. Within ninety
(90) days after the Effective Date, ArgentBank shall pay to
former Assumption Bank employees any amounts owed in lieu of
accrued personal days through the last day of fiscal 1996.
Prior to the Effective Date, Assumption Bank shall amend its
policy so as not to accrue any further amounts owed in lieu
of accrued personal days after December 31, 1996.
7.17 Benefit Plans.
(a) ABI's and Assumption Bank's group health and
life benefit plan will be continued through the Effective
Date of the Mergers. Thereafter, all retained employees
will be eligible to participate in ArgentBank's group health
and life benefit plan based on the provisions in the plan.
The ninety (90) day employment period will be waived for
eligible retained employees in accordance with ArgentBank's
plan. ArgentBank will waive pre-existing medical conditions
for health insurance purposes as to all retained personnel,
provided such pre-existing medical conditions were covered
at Closing under ABI's group health benefit plan.
(b) ArgentBank will merge the Retirement Plan for
Employees of Assumption Bank into the ArgentBank Pension
Plan in accordance with the Code treasury regulation Section
1.414(1)-1(d) before the expiration of the transition period
described in Section 410(b)(6)(C) of the Code.
(c) From and after the Effective Date, ArgentBank
will, subject to compliance with applicable legal and
regulatory requirements, provide coverage for all Assumption
Bank employees under all ArgentBank employee benefit plans
for which they are eligible, as soon as practicable after
the Effective Date. All prior years of service of
Assumption Bank employees will be counted for vesting and
eligibility purposes (including eligibility for early
retirement benefits under the ArgentBank Pension Plan) under
all applicable ArgentBank employee benefit plans to the
extent permitted by applicable law. Any Assumption Bank
employee who, immediately prior to the Effective Date, is
covered by or is a participant in an Assumption Bank
employee benefit plan listed on Schedule 7.17(c) hereto,
shall, at the Effective Date, be covered by or participate
in the comparable ArgentBank employee benefit plan if a
comparable plan otherwise is maintained by ArgentBank and if
the eligibility requirements of the ArgentBank plan are met.
(d) Each of ABI and Assumption Bank shall notify
its respective employees of the terms of this Agreement as
it affects and/or relates to them and for complying with any
applicable laws regarding such notices.
7.18 Further Assurances. Subject to the terms and
conditions herein provided, each of the parties hereto
agrees to use its best efforts to take, or cause to be
taken, all actions 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 contemplated by this Agreement. In case at any
time after the Effective Date any further action is
necessary or desirable to carry out the purposes of this
Agreement, the proper officers and directors of each party
to this Agreement shall take all such necessary or desirable
action.
7.19 Mutual Covenant of Best Efforts and Good Faith.
The Parties mutually covenant and agree with each other that
they will use their best efforts to consummate the
transactions herein contemplated and that they will act and
deal with each other in good faith as to this Agreement and
all matters arising from or related to it.
7.20 Press Releases. ABI and ArgentBank shall consult
with each other as to the form and substance of any press
release related to this Agreement or the transactions
contemplated hereby, and shall consult each other as to the
form and substance of other public disclosures related
thereto, provided, however, that nothing contained herein
shall prohibit either party, following notification to the
other, from making any disclosures which its counsel deems
necessary to conform with requirements of law or the rules
of the National Association of Securities Dealers Automated
Quotation System.
7.21 Consent of ArgentBank. To the extent that any
member of the ABI Consolidated Group is required to obtain
the written consent of a representative of ArgentBank prior
to taking any action, such request shall be made in writing
and ArgentBank shall provide a prompt written response to
such written request for consent, provided, however, any
such written response required pursuant to Section 7.1(g)
shall be provided within seven days of receipt by ArgentBank
of such written request. Any failure to provide a prompt
written response shall be deemed to evidence the consent of
ArgentBank to the action that is the subject of the written
request for consent.
8 CONDITIONS TO CLOSING
8.1 Conditions to Each Party's Obligations to Effect
the Mergers. The respective obligation of each party to
effect the Mergers shall be subject to the following
conditions at or prior to the Closing:
(a) Shareholder Approval. This Agreement and the
Merger Agreements shall have been approved by the requisite
vote of the holders of the outstanding shares of ABI,
Assumption Bank and AgentBank Common Stock.
(b) Regulatory Approvals. All statutory
requirements for the valid consummation of the transactions
contemplated by this Agreement shall have been fulfilled,
including the passage of any waiting period; all appropriate
orders, consents and approvals from all regulatory agencies
and other governmental authorities whose order, consent or
approval is required by law for the consummation of the
transactions contemplated by this Agreement shall have been
received; and the terms of all requisite orders, consents
and approvals shall then permit the effectuation of the
transactions contemplated by this Agreement without the
imposition of any material conditions with respect thereto
except for any such conditions that are acceptable to
ArgentBank, subject to the provisions of Section 10.10
hereof.
(c) Registration Statement. The Registration
Statement shall have been declared effective and shall not
be subject to a stop order or any threatened stop order, and
all state securities and blue sky permits or approvals
required to consummate the transactions contemplated by this
Agreement shall have been received.
(d) No Restraining Action. No action or
proceeding shall have been threatened or instituted before a
court or other governmental body to restrain or prohibit the
transactions contemplated by the Merger Agreements or this
Agreement or to obtain damages or other relief in connection
with the execution of such agreements or the consummation of
the transactions contemplated hereby or thereby.
(e) Tax Opinion. ArgentBank and Assumption Bank
shall have received an opinion of Xxxxxxx Xxxxxx & Xxxxxxx,
P.A. substantially to the effect set forth in Exhibit F
hereto.
8.2 Additional Conditions to Obligations of ABI and
Assumption Bank to Effect the Mergers. The obligations of
ABI and Assumption Bank to effect the Mergers shall be
subject to the following additional conditions at or prior
to the Closing:
(a) Representations and Warranties. The
representations and warranties of ArgentBank set forth in
this Agreement shall be true and correct in all material
respects (except to the extent such representation or
warranty is qualified by materiality in which case such
representation or warranty shall be true and correct) as of
the date of this Agreement and as of the Closing as though
made at and as of the Closing, except as otherwise
contemplated by this Agreement or consented to in writing by
ABI.
(b) Performance of Obligations. ArgentBank shall
have performed in all material respects all obligations and
complied with all covenants required by it under this
Agreement prior to the Closing and ArgentBank shall deliver
at Closing appropriate certificates setting forth such.
(c) No Material Adverse Change. There shall not
have occurred any material adverse change from the date of
this Agreement to the Closing Date in the financial
condition, results of operations or business of ArgentBank
and its subsidiaries taken as a whole.
(d) Fairness Opinion. ABI and Assumption Bank
shall have received a letter from Chaffe & Associates, Inc.,
or another financial advisor selected by Assumption Bank,
dated within five (5) days of the date of the mailing of the
Proxy Statement to its shareholders to the effect that the
terms of the Mergers are fair to its shareholders from a
financial point of view.
(e) Legal Opinion. An opinion of Xxxxxxx Xxxxxx
& Xxxxxxx, P.A., counsel to ArgentBank, shall be delivered
to ABI dated the Closing Date and in form and substance
reasonably satisfactory to ABI and its counsel to the effect
that:
i. ArgentBank is a Louisiana banking
corporation, duly organized and validly existing and in good
standing under the laws of the State of Louisiana, and has
corporate authority to own, lease and operate its properties
and to carry on its business as presently conducted by it;
ii. ArgentBank has corporate authority to
make, execute and deliver this Agreement, it has been duly
authorized and approved by all necessary corporate action of
ArgentBank and has been duly executed and delivered and is
as of the Closing Date enforceable against it, subject,
however, to bankruptcy, insolvency and similar laws
affecting the enforcement of creditors' rights generally and
to the availability of equitable remedies in general;
iii. All required regulatory approvals have
been obtained;
iv. To such counsel's knowledge after
inquiry, there is no litigation or proceeding pending or
threatened against ArgentBank relating to the participation
in or consummation of this Agreement by ArgentBank and
consummation will not violate the charter or bylaws of
ArgentBank or any material contract or agreement to which it
is a party;
v. All shares of ArgentBank Common Stock to
be issued pursuant to the Mergers have been duly authorized
and, when issued pursuant to the Merger Agreements, will be
validly and legally issued, fully paid and non-assessable
and will be, at the time of their delivery, free and clear
of all liens, claims, and encumbrances, preemptive or
similar rights (except as provided in Section 262 of the
Banking Laws).
vi. The Registration Statement has become
effective, and to such counsel's knowledge, no stop order
suspending its effectiveness has been issued nor have any
proceedings for that purpose been instituted;
vii. The Registration Statement and each
amendment or supplement thereto, as of their respective
effective or issue dates, complied as to form in all
material respects with the requirements of the Securities
Act and the rules and regulations promulgated thereunder,
and such counsel does not know of any contracts or documents
required to be filed as exhibits to the Registration
Statement which are not filed as required; it being
understood that such counsel need express no opinion as to
the financial statements or other financial or statistical
data contained in or omitted from the Registration Statement
or the Proxy Statement; and
viii. Such counsel has participated in several
conferences with representatives of the parties of this
Agreement and their respective accountants and counsel in
connection with the preparation of the Registration
Statement and the Proxy Statement to be filed in connection
with the transactions contemplated by this Agreement and
have considered the matters required to be stated therein
and the statements contained therein, and based on the
foregoing (in certain circumstances relying as to
materiality on the opinions of officers and representatives
of the parties to this Agreement) nothing has come to the
attention of such counsel that would lead them to believe
that such Registration Statement or the Proxy Statement, as
amended or supplemented if it has been amended or
supplemented, at the time it became effective and as amended
or supplemented, (in the case of the Registration Statement)
or at the time distributed to shareholders (in the case of
the Proxy Statement), contained any untrue statement of a
material fact or omitted a material fact required to be
stated therein or necessary to make the statements therein
not misleading (except in each such case
for the financial statements and other financial and
statistical data included therein, as to which no opinion
need be rendered).
As to matters of fact, counsel to ArgentBank may rely,
to the extent they deem appropriate, upon certificates of
officers of ArgentBank, provided, such certificates are
delivered to ABI and Assumption Bank prior to the Closing
Date or attached to the opinion of counsel.
(f) Director Actions. ArgentBank's directors shall
have unanimously voted as directors in favor of this
Agreement and the Bank Merger Agreement, and unanimously
recommended to its shareholders the approval of this
Agreement and the Bank Merger Agreement and the transactions
contemplated hereby and such other matters as may have been
submitted to its shareholders in connection with this
Agreement.
8.3 Additional Conditions to Obligations of ArgentBank
to Effect the Bank Merger. The obligations of ArgentBank to
effect the Bank Merger shall be subject to the following
additional conditions at or prior to the Closing:
(a) Representations and Warranties. The
representations and warranties of ABI and Assumption Bank
set forth in this Agreement shall be true and correct in all
material respects as of the date of this Agreement (except
to the extent such representation or warranty is qualified
by materiality in which case such representation or warranty
shall be true and correct) and as of the Closing as though
made at and as of the Closing, except as otherwise
contemplated by this Agreement or consented to in writing by
ArgentBank.
(b) Performance of Obligations. ABI and
Assumption Bank shall have performed in all material
respects all obligations and complied with all covenants
required by it under this Agreement prior to the Closing and
ABI shall deliver at Closing appropriate certificates
setting forth such.
(c) No Material Adverse Change. There shall not
have occurred any material adverse change from the date of
this Agreement to the Closing Date in the financial
condition, results of operations or business of ABI and its
subsidiaries taken as a whole.
(d) Legal Opinion. An Opinion of Jones, Walker,
Waechter, Poitevent, Carrere & Xxxxxxx, L.L.P., counsel to
ABI and Assumption Bank, shall be delivered to ArgentBank
dated the Closing Date, and in form and substance reasonably
satisfactory to ArgentBank to the effect that:
i. ABI is a corporation duly incorporated,
validly existing and in good standing under the laws of the
State of Louisiana, and has corporate authority to own,
lease and operate its properties and to carry on its
business as presently conducted by it;
ii. Assumption Bank is a Louisiana banking
corporation, duly organized and validly existing and in good
standing under the laws of the State of Louisiana, and has
corporate authority to own, lease and operate its properties
and to carry on its business as presently conducted by it;
iii. ABI and Assumption Bank have corporate
authority to make, execute and deliver this Agreement, it
has been duly authorized and approved by all necessary
corporate action of ABI and Assumption Bank and has been
duly executed and delivered and is as of the Closing Date
enforceable against each of them, subject, however, to
bankruptcy, insolvency and similar laws affecting the
enforcement of creditors' rights generally and to the
availability of equitable remedies in general;
iv. To such counsel's knowledge after
inquiry, there is no litigation or proceeding pending or
threatened against ABI or Assumption Bank relating to the
participation in or consummation of this Agreement by ABI or
Assumption Bank and consummation will not violate the
charter or bylaws of ABI or Assumption Bank or any material
contract or agreement to which either of them is a party;
v. Such counsel has participated in several
conferences with representatives of the parties of this
Agreement and their respective accountants and counsel in
connection with the preparation of the Registration
Statement and the Proxy Statement to be filed in connection
with the transactions contemplated by this Agreement and
have considered the matters required to be stated therein
and the statements contained therein, and based on the
foregoing (in certain circumstances relying as to
materiality on the opinions of officers and representatives
of the parties to this Agreement) nothing has come to the
attention of such counsel that would lead them to believe
that such Registration Statement or the Proxy Statement, as
amended or supplemented if it has been amended or
supplemented, at the time it became effective and as amended
or supplemented, (in the case of the Registration Statement)
or at the time distributed to shareholders (in the case of
the Proxy Statement), contained any untrue statement of a
material fact or omitted a material fact required to be
stated therein or necessary to make the statements therein
not misleading (except in each such case for the financial
statements and other financial and statistical data included
therein, as to which no opinion need be rendered).
As to matters of fact, counsel to ABI and Assumption
Bank may rely, to the extent they deem appropriate, upon
certificates of officers of ABI and Assumption Bank,
provided, such certificates are delivered to ArgentBank
prior to the Closing Date or attached to the opinion of
counsel.
(e) Director Actions. ABI's directors shall have,
subject to the provisions of Section 7.7 hereof, unanimously
voted as directors in favor of approving this Agreement and
the Merger Agreements, and unanimously recommended to the
ABI shareholders the approval of this Agreement, the Merger
Agreements and the transactions contemplated hereby and such
other matters as may have been submitted to the shareholders
in connection with this Agreement. A majority of ABI's
Board of Directors shall also have voted the shares of ABI
Common Stock held by them in favor of this Agreement and the
Merger Agreements, and shall not have intentionally, openly
and publicly undertaken or participated in any concerted
overt efforts against the transactions contemplated hereby.
ARTICLE 9 TERMINATION
9.1 Termination. This Agreement may be terminated,
either before or after approval by the shareholders of ABI,
Assumption Bank and AgentBank as follows:
(a) Mutual Consent. At any time on or prior to
the Effective Date, by the mutual consent in writing of a
majority of the members of each of the Board of Directors of
the Parties hereto;
(B) Expiration of Time. By the Board of
Directors of ArgentBank in writing or by the Board of
Directors of ABI in writing, if the Mergers shall have not
become effective on or before June 30, 1997, unless the
absence of such occurrence shall be due to the failure of
the Party seeking to terminate this Agreement to perform
each of its obligations under this Agreement required to be
performed by it on or prior to the Effective Date;
(c) Breach of Representation, Warranty or
Covenant. By either Party hereto, in the event of a breach
by the other Party (a) of any covenant or agreement
contained herein or (b) of any representation or warranty
herein, if (i) the facts constituting such breach reflect a
material and adverse change in the financial condition,
results of operations, business, or prospects taken as a
whole, of the breaching Party, which in either case cannot
be or is not cured within 60 days after written notice of
such breach is given to the Party committing such breach, or
(ii) in the event of a breach of a warranty or covenant,
such breach results in a material increase in the cost of
the non-breaching Party's performance of this Agreement.
(d) Regulatory Approval. By either Party hereto,
at any time after the FRB, FDIC, or OFI has denied any
application for any approval or clearance required to be
obtained as a condition to the consummation of the Mergers
or imposed any condition for the approval thereof not
acceptable to ArgentBank as provided in Section 8.1(b)
hereof and the time-period for all appeals or requests for
reconsideration thereof has run, or if a United States
District Court shall rule upon application of the Department
of Justice after a full trial on the merits or a decision on
the merits based on a stipulation of facts that the
transactions contemplated by this Agreement violate the
antitrust laws of the United States.
(e) Shareholder Approval. By either Party
hereto, if this Agreement and the Merger Agreements are not
approved by the required vote of shareholders of ABI,
Assumption Bank or ArgentBank.
(f) Dissenters. By ArgentBank, if holders of ten
percent (10%) or more of the outstanding ABI Common Stock
exercise statutory rights of dissent and appraisal in
connection with the approval of this Agreement and the
Merger Agreements.
(g) Price of ArgentBank Common Stock.
(i) By ABI or Assumption Bank, if the Average
Market Price of ArgentBank Common Stock on the Effective
Date, exceeds $23.00; or
(ii) By ArgentBank, if the Average Market
Price of ArgentBank Common Stock on the Effective Date, is
less than $15.00.
(h) Fiduciary Out. By ABI's Board of Directors
in accordance with Section 7.7 hereof upon payment of the
expenses referenced in Section 10.10(b) hereof.
9.2 Effect of Termination. In the event of
termination of this Agreement by any party as provided
above, the Merger Agreements shall also terminate and this
Agreement, and the Merger Agreements shall forthwith become
void and except as provided in Sections 7.6(b), 7.10(b),
7.11(d) and 10.10 hereof, there shall be no further
liability on the part of any party hereto or any of their
respective officers or directors.
ARTICLE 10 MISCELLANEOUS
10.1 Entire Agreement. This Agreement embodies the
entire understanding of the Parties in relation to the
subject matter herein and supersede all prior understandings
or agreements, oral or written, between the Parties hereto.
10.2 Non-Survival of Representations and Warranties.
None of the representations and warranties in this Agreement
shall survive the Effective Date, or the earlier termination
of this Agreement pursuant to Article 9 hereof. Except as
provided in Section 10.10 hereof, each party hereby agrees
that its sole right and remedy with respect to any breach of
a representation or a warranty by the other party shall be
to not consummate the transactions described herein if such
breach results in the nonsatisfaction of a condition set
forth in Section 8.2 or 8.3 hereof, provided, however, that
the foregoing shall not be deemed a waiver of any claim for
intentional misrepresentation or fraud.
10.3 Headings. The headings and subheadings in this
Agreement, except the terms identified for definition in
Article 1 and elsewhere in this Agreement, are inserted for
convenience only and shall not affect the meaning or
interpretation of this Agreement or any provision hereof.
10.4 Duplicate Originals. This Agreement may be
executed in any number of duplicate originals, any one of
which when fully executed by all Parties shall be deemed to
be an original without having to account for the other
originals.
10.5 Governing Law. This Agreement and the rights and
obligations hereunder shall be governed and construed by the
laws of the State of Louisiana.
10.6 Successors: No Third Party Beneficiaries. All
terms and conditions of this Agreement shall be binding on
the successors and assigns of ABI and ArgentBank. Except as
otherwise specifically provided in this Agreement, nothing
expressed or referred to in this Agreement is intended or
shall be construed to give any person other than ABI and
ArgentBank any legal or equitable right, remedy or claim
under or in respect of this Agreement or any provisions
contained herein, it being the intention of the Parties
hereto that this Agreement, the obligations and statements
of responsibilities hereunder, and all other conditions and
provisions hereof are for the sole and exclusive benefit of
ABI and ArgentBank and for the benefit of no other person.
10.7 Modification; Assignment. No amendment or other
modification of any part of this Agreement shall be
effective except pursuant to a written agreement subscribed
by the duly authorized representatives of all of the Parties
hereto. After approval of this Agreement by the ABI
shareholders, this Agreement may not be amended to change
the amount of consideration to be delivered to the ABI
shareholders without further approval of such amendment by
such shareholders. This Agreement may not be assigned
without the express written consent of both Parties.
10.8 Notice. Any notice, request, demand, consent,
approval or other communication to any Party hereof shall be
effective when received and shall be given in writing, and
delivered in person against receipt thereof, or sent by
certified mail, postage prepaid or courier service or
facsimile at its address set forth below or at such other
address as it shall hereafter furnish in writing to the
others. All such notices and other communications shall be
deemed given on the date received by the addressee or its
agent.
ABI and Assumption Bank
Assumption Bancshares, Inc.
000 Xxxxxxxx Xxxxxx
Post Xxxxxx Xxx 000
Xxxxxxxxxxxxx, Xxxxxxxxx 00000-0000
Attn: Xxxxxx X. Xxxxxxx
Fax Number: (000) 000-0000
Copy to: Jones, Walker, Waechter, Poitevent,
Carrere & Xxxxxxx, L.L.P.
000 Xx. Xxxxxxx Xxx., Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxx 00000
Attn: W. Xxxxxx Xxxxxxx, Esq.
Fax Number: (000) 000-0000
ArgentBank
ArgentBank
000 X. Xxxxxx Xxxxxx (70301)
Xxxx Xxxxxx Xxx 000
Xxxxxxxxx, Xxxxxxxxx 00000-0000
Attn: Xxxxxxx X. Xxxxxx
Fax Number: (000) 000-0000
Copy to: Xxxxxxx Xxxxxx & Xxxxxxx, P.A.
000 Xxxxx Xxxxx Xxxxxx (39202)
P. O. Xxx 000
Xxxxxxx, XX 00000-0000
Attn: Xxxx X. Xxxxxx, Esq.
Fax Number: (000) 000-0000
10.9 Waiver. ABI and ArgentBank may waive their
respective rights, powers or privileges under this
Agreement; provided that such waiver shall be in writing;
and further provided that no failure or delay on the part of
ABI or ArgentBank to exercise any right, power or privilege
under this Agreement will operate as a waiver thereof, nor
will any single or partial exercise of any right, power or
privilege under this Agreement preclude any other or further
exercise thereof or the exercise of any other right, power
or privilege by ABI or ArgentBank under the terms of this
Agreement, nor will any such waiver operate or be construed
as a future waiver of such right, power or privilege under
this Agreement.
10.10 Costs, Fees and Expenses.
(a) Except as set forth below, each Party hereto
agrees to pay all costs, fees and expenses which it has
incurred in connection with or incidental to the matters
contained in this Agreement, including without limitation
any fees and disbursements to its accountants, counsel and
financial advisors. ArgentBank will be responsible for
preparing the applications, regulatory filings and
registration and proxy statement necessary to obtain
regulatory and shareholder approval of the Mergers and the
issuance of the ArgentBank common stock. ABI will be
responsible for all costs related to conducting its
shareholders' meetings and obtaining its shareholders'
approval of the Mergers.
(b) In recognition of the fact that ArgentBank
will bear the bulk of the expense in preparing for
regulatory approvals, if the shareholders of ABI or
Assumption Bank fail to approve the transaction because of
action taken by an officer or director of ABI or Assumption
Bank upon opinion of counsel pursuant to Section 7.7, ABI
shall pay all reasonable third party out of pocket expenses
incurred by ArgentBank in connection with the Mergers.
(c) In the event that ArgentBank terminates this
Agreement pursuant to Section 8.1(b) because of the
imposition of a material condition to the approval of the
transaction contemplated hereby by any regulatory or
governmental authority which requires a divestiture or other
antitrust or anticompetitive condition, that is not
acceptable to ArgentBank, ArgentBank shall pay all
reasonable third party out of pocket expenses incurred by
ABI and Assumption Bank in connection with the Mergers.
10.11 Severability. If any provision of this Agreement
is invalid or unenforceable then, to the extent possible,
all of the remaining provisions of this Agreement shall
remain in full force and effect and shall be binding upon
the Parties hereto.
IN WITNESS WHEREOF, the Parties hereto have caused this
Agreement to be executed by their duly authorized
representatives as of the date first above written.
ASSUMPTION BANCSHARES, INC.
By:
Name: XXXXXX X. XXXXXXX, XX
Attest: Title: PRESIDENT & CEO
ASSUMPTION BANK & TRUST COMPANY
By:
Name: XXXXXX X. XXXXXXX, XX
Title: PRESIDENT & CEO
Attest:
ARGENTBANK
By:
Name: XXXXXXX X. XXXXXX
Title: PRESIDENT
Attest:
EXHIBIT A
COMPANY MERGER AGREEMENT
This Company Merger Agreement (the "Company Merger
Agreement") is made and entered into as of the ____ day of
__________, 1996, between Assumption Bank & Trust Company,
Napoleonville, Louisiana, a Louisiana state nonmember bank
("Assumption Bank") and Assumption Bancshares, Inc.,
Napoleonville, Louisiana, a Louisiana corporation ("ABI").
WITNESSETH:
WHEREAS, Assumption Bank and ABI (collectively, the
"Constituent Corporations") and their respective Boards of
Directors deem it advisable that ABI be merged with and into
its wholly-owned subsidiary, Assumption Bank, (the "Company
Merger") pursuant to the provisions of the Louisiana
Business Corporation Law (the "LBCL") and the Louisiana
Banking Laws (the "Banking Laws") and upon the terms and
conditions hereinafter set forth and in the Plan (as
hereinafter defined); and
WHEREAS, the Constituent Corporations and ArgentBank,
Thibodaux, Louisiana, a Louisiana state nonmember bank
("ArgentBank") have entered into an Agreement and Plan of
Merger dated as of the date hereof (the "Plan") (the defined
terms in which are used herein as defined therein) setting
forth certain representations, warranties, covenants and
conditions relating to the Company Merger and relating to
the merger of Assumption Bank into ArgentBank (the "Bank
Merger");
NOW THEREFORE, in consideration of their mutual
promises and obligations, the Constituent Corporations
hereby make, adopt and approve this Company Merger Agreement
and prescribe the terms and conditions of the Company Merger
and the mode of carrying the Company Merger into effect as
follows:
ARTICLE ONE
The Company Merger
Upon the terms and subject to the conditions
hereinafter set forth, on the Effective Date (as defined in
Article Two hereof) ABI shall be merged into Assumption
Bank, which shall be the surviving association and the
separate existence of ABI shall cease.
ARTICLE TWO
Effective Date and Time
The Company Merger shall be effective on the date and
time specified by the Office of Financial Institutions of
the State of Louisiana ("OFI") in a Certificate of Merger or
other written record issued by the OFI (such time and date
being herein referred to as the "Effective Time" and the
"Effective Date", respectively).
ARTICLE THREE
Conversion and Cancellation of Shares
On the Effective Date, by virtue of the Company Merger
and without any action on the part of the holders thereof,
each share of common stock, $5.00 par value, of ABI ("ABI
Common Stock") outstanding immediately prior to the
Effective Date shall be changed and converted into one fully
paid and nonassessable share of common stock, par value
$25.00 per share, of Assumption Bank ("Assumption Bank
Common Stock"). All treasury shares of each of ABI and
Assumption Bank and all issued and outstanding shares of
Assumption Bank Common Stock owned by ABI shall be canceled.
ARTICLE FOUR
Effects of Company Merger
The Company Merger shall have the effects set forth in
Section 115 of the LBCL and in Section 355 of the Banking
Laws.
ARTICLE FIVE
Filing of Company Merger Agreement
If this Company Merger Agreement is approved by the
shareholders of ABI and Assumption Bank, then the fact of
such approval shall be certified hereon by the Secretary or
Assistant Secretary of the Constituent Corporations, and
this Company Merger Agreement, as approved and certified,
shall be signed and acknowledged by the President or Vice
President of each of the Constituent Corporations.
Thereafter, a multiple original of this Company Merger
Agreement, so certified, signed and acknowledged, shall be
delivered to the Louisiana Secretary of State and the OFI
for filing and recordation in the manner required by law and
thereafter, as soon as practicable (but not later than the
time required by law), a copy of the Certificate of Merger
issued by the Louisiana Secretary of State shall be filed
for record in the office of the recorder of mortgages for
the parishes of Lafourche and Assumption and shall also be
recorded in the conveyance records for the parishes of
Lafourche and Assumption and any other parish in which any
of the Constituent Corporations owns real property on the
Effective Date of the Company Merger, and a copy of the OFI
Certificate of Merger along with a multiple original of this
Company Merger Agreement shall be filed for record with the
Louisiana Secretary of State and in the office of the
recorder of mortgages for the parishes of Lafourche and
Assumption.
ARTICLE SIX
Miscellaneous
The obligations of the Constituent Corporations to
effect the Company Merger shall be subject to all of the
terms and conditions of the Plan. At any time prior to the
Effective Date, this Company Merger Agreement may be
terminated pursuant to the terms and provisions of the Plan.
IN WITNESS WHEREOF, this Company Merger Agreement is
signed by a majority of the Directors of each of the
Constituent Corporations as of the day first above written.
ASSUMPTION BANCSHARES, INC.
By a Majority of its Board of
Directors
ASSUMPTION BANK & TRUST COMPANY
By a Majority of its Board of
Directors
EXECUTION BY BANK AND CORPORATION
Considering the approval of this Company Merger
Agreement by the shareholders of Assumption Bank & Trust
Company and Assumption Bancshares, Inc., as certified above,
this Company Merger Agreement is executed by such banking
association and corporation, respectively, acting through
their respective Presidents, as of the _____ day of
__________________, 199__.
ASSUMPTION BANK & TRUST COMPANY
BY:
________________, President
ATTEST:
____________________, Secretary
ASSUMPTION BANCSHARES, INC.
BY:
_____________________, President
ATTEST:
__________________, Secretary
ACKNOWLEDGMENT AS TO
ASSUMPTION BANK & TRUST COMPANY
STATE OF LOUISIANA
PARISH OF _____________
BEFORE ME, the undersigned authority, personally came
and appeared _____________________________, who, being duly
sworn, declared and acknowledged before me that he is the
President of Assumption Bank & Trust Company and that in
such capacity he was duly authorized to and did execute the
foregoing Company Merger Agreement on behalf of such banking
association, for the purposes therein expressed and as his
and such banking association's free act and deed.
___________________, Appearer
SWORN to and subscribed before me this _____ day of
_____________, 199__.
NOTARY PUBLIC
My Commission Expires:
________________________________
ACKNOWLEDGMENT AS TO
ASSUMPTION BANCSHARES, INC.
STATE OF LOUISIANA
PARISH OF _____________________
BEFORE ME, the undersigned authority, personally came
and appeared _________________________________, who, being
duly sworn, declared and acknowledged before me that he is
the President of Assumption Bancshares, Inc. and that in
such capacity he was duly authorized to and did execute the
foregoing Company Merger Agreement on behalf of such
corporation, for the purposes therein expressed and as his
and such corporation's free act and deed.
_____________________,
Appearer
SWORN to and subscribed before me this _____ day of
______________, 1997.
NOTARY PUBLIC
My Commission Expires:
________________________________
ASSUMPTION BANCSHARES, INC.
SECRETARY'S CERTIFICATE TO
COMPANY MERGER AGREEMENT
I, __________________________, the duly elected,
qualified and acting Secretary of Assumption Bancshares,
Inc., a Louisiana corporation ("ABI"), hereby certify that
the foregoing Company Merger Agreement was, in the manner
required by law, duly approved, without alteration or
amendment, by at least two-thirds of the voting power
present of ABI.
IN WITNESS WHEREOF, I have hereunto subscribed my hand
as of the ____ day of __________________, 199__.
_________________________,
Secretary
ASSUMPTION BANK & TRUST COMPANY
SECRETARY'S CERTIFICATE TO
COMPANY MERGER AGREEMENT
I, _______________________, the duly elected, qualified
and acting Secretary of Assumption Bank & Trust Company, a
Louisiana banking corporation ("Assumption Bank"), hereby
certify that the Company Merger Agreement was, in the manner
required by law, duly approved, without alteration or
amendment, by the sole shareholder of Assumption Bank &
Trust Company.
IN WITNESS WHEREOF, I have hereunto subscribed my hand
as of the _____ day of _________________, 199___.
__________________________,
Secretary
EXHIBIT B
BANK MERGER AGREEMENT
This Bank Merger Agreement (the "Bank Merger
Agreement") is made and entered into as of the ____ day of
_________, 1996, between ArgentBank, Thibodaux, Louisiana, a
Louisiana state nonmember bank ("ArgentBank") and Assumption
Bank & Trust Company, Napoleonville, Louisiana, a Louisiana
state nonmember bank ("Assumption Bank").
WITNESSETH:
WHEREAS, ArgentBank and Assumption Bank (collectively,
the "Constituent Banks") and their respective Boards of
Directors deem it advisable that Assumption Bank be merged
with and into ArgentBank (the "Bank Merger") pursuant to the
provisions of the Louisiana Banking Laws (the "Banking
Laws") and upon the terms and conditions hereinafter set
forth and in the Plan (as hereinafter defined); and;
WHEREAS, ArgentBank, the Assumption Bank and Assumption
Bancshares, Inc., Napoleonville, Louisiana, a Louisiana
corporation ("ABI") have entered into an Agreement and Plan
of Merger dated as of the date hereof (the "Plan") (the
defined terms in which are used herein as defined therein)
setting forth certain representations, warranties, covenants
and conditions relating to the Bank Merger and relating to
the merger of ABI into Assumption Bank (the "Company
Merger");
NOW THEREFORE, in consideration of their mutual
promises and obligations, the Constituent Banks hereby make,
adopt and approve this Bank Merger Agreement and prescribe
the terms and conditions of the Bank Merger and the mode of
carrying the Bank Merger into effect as follows:
ARTICLE ONE
The Bank Merger
Upon the terms and subject to the conditions
hereinafter set forth, on the Effective Date (as defined in
Article Two hereof) Assumption Bank shall be merged into
ArgentBank which shall be the surviving association and the
separate existence of Assumption Bank shall cease.
ARTICLE TWO
Effective Date and Time
The Bank Merger shall be effective on the date and time
specified by the Office of Financial Institutions of the
State of Louisiana ("OFI") in a Certificate of Merger or
other written record issued by the OFI (such time and date
being herein referred to as the "Effective Time" and the
"Effective Date", respectively).
ARTICLE THREE
Conversion and Cancellation of Shares
(a) Subject to paragraphs (b) and (c) below, on the
Effective Date, by reason of the Bank Merger, each share of
Assumption Bank Common Stock outstanding immediately
following the Company Merger shall, in accordance with the
election made or deemed to have been made by the holder
thereof in accordance with the procedures set forth in
Section 3.3 of the Plan, be converted into (i) that number
of shares of common stock, $.10 par value per share, of
ArgentBank ("ArgentBank Common Stock") equal to (x) $21.5
million (the "Aggregate Merger Consideration Value") divided
by the average of the closing sale prices of a share of
ArgentBank Common Stock on the NASDAQ Stock Market for the
forty days on which the NASDAQ Stock Market is open for
trading preceding the fifth trading day immediately prior to
the Effective Date (the "Average Market Price"), divided by
(y) the number of outstanding shares of Assumption Bank
Common Stock immediately following the Company Merger;
provided that the formula set forth above shall be adjusted
to take into account any change in the number of shares of
ArgentBank Common Stock outstanding as a result of a stock
split or stock dividend (as it may be so adjusted, the
"Conversion Number"), or (ii) the right to receive $134.375
in cash (the "Cash Payment") ((i) and (ii) together, the
"Merger Consideration"); provided that, any holder of 15 or
fewer shares of Assumption Bank Common Stock ("De minimis
Holdings") shall only be entitled to receive a Cash Payment
for such shares, and holders of shares of Assumption Bank
Common Stock as to which dissenter's rights have been
perfected and not withdrawn or otherwise forfeited under
Section 376 of the Banking Laws or Section 131 of the LBCL
shall not receive any shares of ArgentBank Common Stock for
such shares, but shall instead be deemed to have made an
election to receive Cash Payments for all of such shares.
(b) The total Cash Payments that shall be made
hereunder (including (i) the Cash Payments that holders of
Assumption Bank Common Stock have elected, or have been
deemed to have elected pursuant to Section 3.3(b)(i) of the
Plan to receive ("Elected Cash Payments"), (ii) the Cash
Payments that have been made in exchange for De minimis
Holdings, (iii) the amount of cash paid in lieu of
fractional shares pursuant to Section 3.3(h) of the Plan,
and (iv) the amount of cash paid with respect to shares of
Assumption Bank Common Stock ("Dissenting Shares") as to
which dissenters rights have been perfected ("Total Cash
Payments")) shall be limited to a maximum of $10,535,000
(the "Maximum Cash Number") and a minimum of $7,525,000 (the
"Minimum Cash Number").
(c) If the Total Cash Payments payable to holders of
Assumption Bank Common Stock in the aggregate exceed the
Maximum Cash Number, the Available Cash (as defined below)
shall be allocated among such holders pro rata, determined
by multiplying the number of shares for which each holder of
Assumption Bank Common Stock has elected to receive an
Elected Cash Payment times a fraction, the numerator of
which shall be the Maximum Cash Number less the amount of
(i) Cash Payments that must be made in exchange for De
minimis Holdings (ii) cash paid in lieu of fractional shares
and (iii) cash paid with respect to Dissenting Shares, and
the denominator of which shall be the total amount of
Elected Cash Payments that holders of Assumption Bank Common
Stock shall have elected to receive. The aggregate amount
of cash available for all Cash Payments (the "Available
Cash") shall be equal to the Maximum Cash Number. The
number of shares of Assumption Bank Common Stock for which
each holder shall be entitled to an Elected Cash Payment
determined in accordance with the foregoing formula (such
holder's "Pro Rata Share") shall then be multiplied by the
amount of the Cash Payment to determine the total amount of
cash such holder shall be entitled to receive. Each share
of Assumption Bank Common Stock for which the holder has
elected to receive an Elected Cash Payment in excess of such
holder's Pro Rata Share shall be converted into shares of
ArgentBank Common Stock in accordance with the provisions of
paragraph (a) above.
(d) If the Total Cash payments payable to holders of
Assumption Bank Common Stock in the aggregate is less than
the Minimum Cash Number, the Available Shares (as defined
below) shall be allocated to such holders pro rata
determined by multiplying the number of shares for which
each holder of Assumption Bank Common Stock has elected to
receive ArgentBank Common Stock times a fraction, the
numerator of which shall be the Available Shares, and the
denominator shall be the total number of shares of
Assumption Bank Common Stock for which holders have elected
to receive shares of ArgentBank Common Stock. The Available
Shares shall equal 104,000 shares. Each share of Assumption
Bank Common Stock for which the holder has elected to
receive ArgentBank Common Stock in excess of such holder's
pro rata share as determined in accordance with the
foregoing formula shall be converted into Cash Payments in
accordance with the provisions of paragraph (a) above.
ARTICLE FOUR
Effects of Bank Merger
The Bank Merger shall have the effects set forth in
Section 355 of the Banking Laws. Upon the Effective Date,
each branch office maintained by Assumption Bank as a branch
office immediately before the Bank Merger becomes effective,
shall become a branch office of ArgentBank.
ARTICLE FIVE
Filing of Merger Agreement
If this Bank Merger Agreement is approved by the
shareholders of Assumption Bank and ArgentBank, then the
fact of such approval shall be certified hereon by the
Secretary or Assistant Secretary of the Constituent Banks,
and this Bank Merger Agreement, as approved and certified,
shall be signed and acknowledged by the President or Vice
President of each of the Constituent Banks. Thereafter, a
multiple original of this Merger Agreement, so certified,
signed and acknowledged, shall be delivered to the OFI for
filing and recordation in the manner required by law; and
thereafter, as soon as practicable (but not later than the
time required by law), a copy of the Certificate of Merger
issued by the OFI along with a multiple original of this
Bank Merger Agreement shall be filed for record with the
Louisiana Secretary of State and in the office of the
recorder of mortgages for the parishes of Lafourche and
Assumption.
ARTICLE SIX
Miscellaneous
The obligations of the Constituent Banks to effect the
Bank Merger shall be subject to all of the terms and
conditions of the Plan. At any time prior to the Effective
Date, this Bank Merger Agreement may be terminated pursuant
to the terms and provisions of the Plan.
IN WITNESS WHEREOF, this Bank Merger Agreement is
signed by a majority of the Directors of each of the
Constituent Banks as of the day first above written.
ARGENTBANK
By a Majority of its Board of Directors
____________________________________
________________________________________
____________________________________
________________________________________
____________________________________
________________________________________
____________________________________
________________________________________
____________________________________
________________________________________
____________________________________
________________________________________
____________________________________
________________________________________
____________________________________
________________________________________
____________________________________
________________________________________
____________________________________
________________________________________
____________________________________
________________________________________
(consisting of a majority
of its Directors)
________________________________________
ASSUMPTION BANK & TRUST COMPANY
By a Majority of Its Board of
Directors
__________________________________________
__________________________________________
__________________________________________
__________________________________________
__________________________________________
__________________________________________
__________________________________________
__________________________________________
__________________________________________
__________________________________________
__________________________________________
__________________________________________
__________________________________________
consisting of a majority of its Directors)
EXECUTION BY BANKS
Considering the approval of this Bank Merger Agreement
by the shareholders of Assumption Bank & Trust Company and
by the shareholders of ArgentBank, as certified above, this
Bank Merger Agreement is executed by such banking
associations acting through their respective Presidents, as
of the _____ day of _________________, 199__.
ARGENTBANK
BY:
_____________________,President
ATTEST:
_________________, Secretary
ASSUMPTION BANK & TRUST COMPANY
BY:
__________________, President
ATTEST:
_________________, Secretary
ACKNOWLEDGMENT AS TO
ARGENTBANK
STATE OF LOUISIANA
PARISH OF _________________
BEFORE ME, the undersigned authority, personally came
and appeared ______________, who, being duly sworn, declared
and acknowledged before me that he is the President of
ArgentBank and that in such capacity he was duly authorized
to and did execute the foregoing Bank Merger Agreement on
behalf of such banking association, for the purposes therein
expressed and as his and such banking association's free act
and deed.
_______________________,Appearer
SWORN to and subscribed before me this _____ day of
_______________, 199__.
NOTARY PUBLIC
My Commission Expires:
________________________________
ACKNOWLEDGMENT AS TO
ASSUMPTION BANK & TRUST COMPANY
STATE OF LOUISIANA
PARISH OF ___________________
BEFORE ME, the undersigned authority, personally came
and appeared ______________, who, being duly sworn, declared
and acknowledged before me that he is the President of
Assumption Bank & Trust Company and that in such capacity he
was duly authorized to and did execute the foregoing Bank
Merger Agreement on behalf of such banking association, for
the purposes therein expressed and as his and such banking
association's free act and deed.
_____________________,Appearer
SWORN to and subscribed before me this _____ day of
___________, 199__.
NOTARY PUBLIC
My Commission Expires:
________________________________
ASSUMPTION BANK & TRUST COMPANY
SECRETARY'S CERTIFICATE TO BANK MERGER AGREEMENT
I, _____________________, the duly elected, qualified
and acting Secretary of Assumption Bank & Trust Company, a
Louisiana state nonmember bank ("Assumption Bank"), hereby
certify that the foregoing Bank Merger Agreement was, in the
manner required by law, duly approved without alteration or
amendment, by at least two-thirds of the total voting power
of Assumption Bank.
IN WITNESS WHEREOF, I have hereunto subscribed my hand
as of the ______ day of _______________________, 199__.
_______________________,Secretary
ARGENTBANK
SECRETARY'S CERTIFICATE TO BANK MERGER AGREEMENT
I, __________________________, the duly elected,
qualified and acting Secretary of ArgentBank, a Louisiana
state nonmember bank ("ArgentBank"), hereby certify that the
foregoing Bank Merger Agreement was, in the manner required
by law, duly approved, without alteration or amendment, by
at least two-thirds of the voting power present of
ArgentBank.
IN WITNESS WHEREOF, I have hereunto subscribed my hand
as of the _____ day of __________________________, 199__.
________________________,Secretary
EXHIBIT C
CERTIFICATE OF ASSUMPTION BANK & TRUST COMPANY
RELATING TO SECTION 368 OPINION ON THE BANK MERGER
This Certificate has been requested by the law firm of
Xxxxxxx Xxxxxx & Xxxxxxx, P.A. in connection with the
rendering of its opinion as to certain federal income tax
consequences relating to the merger (the "Bank Merger") of
Assumption Bank & Trust Company ("Assumption Bank") with and
into ArgentBank of Thibodaux, Louisiana ("ArgentBank") as
such transaction is described in that certain Agreement and
Plan of Merger By and Among ArgentBank, Assumption
Bancshares, Inc. and Assumption Bank dated as of November
____, 1996 (the "Merger Agreement"). Xxxxxxx Xxxxxx &
Xxxxxxx, P. A. will rely on the representations stated
hereinafter, as well as on other facts, assumptions, and
representations described in its opinion letter dated
[____________________, 1996 (date of closing)] (the "WL&S
Tax Opinion") in opining on the federal income tax issues
stated therein. Accordingly, this Certificate is an
integral part of the WL&S Tax Opinion. Unless otherwise
noted, all defined or capitalized terms used in this
Certificate have the same meaning ascribed to such terms in
the Merger Agreement or in the WL&S Tax Opinion.
The following representations are being made in
connection with the Bank Merger:
1.The fair market value of the ArgentBank Common Stock and
other consideration (collectively, the "Merger
Consideration") received by each Assumption Bank
shareholder in the Bank Merger exchange will be
approximately equal to the fair market value of the
Assumption Bank Common Stock surrendered in the exchange.
1.The aggregate fair market value of the ArgentBank Common
Stock portion of the Merger Consideration will, on the
Effective Date of the Bank Merger, constitute at least
fifty-one percent (51%) of the total fair market value of
the Merger Consideration exchanged in the Bank Merger.
1.There is no plan or intention by the shareholders of
Assumption Bank who own one percent (1%) or more of the
Assumption Bank Common Stock, and to the best of the
knowledge of management of Assumption Bank there is no plan
or intention on the part of the remaining shareholders of
Assumption Bank, to sell, exchange, or otherwise dispose of
a number of shares of ArgentBank Common Stock received in
the Bank Merger that would collectively reduce the
Assumption Bank shareholders' ownership of ArgentBank Common
Stock to a number of shares having a value, as of the
Effective Date of the Bank Merger, of less than fifty
percent (50%) of the value of all of the formerly
outstanding stock of Assumption Bank as of the same date.
For purposes of this representation, shares of Assumption
Bank Common Stock exchanged for cash in lieu of fractional
shares of ArgentBank Common Stock, exchanged for cash or
other property, or surrendered by dissenters will be treated
as outstanding shares of Assumption Bank Common Stock on the
date of the Bank Merger. Moreover, shares of Assumption
Bank Common Stock and shares of ArgentBank Common Stock held
by Assumption Bank shareholders and otherwise sold,
redeemed, or disposed of prior or subsequent to the Bank
Merger will be considered as part of this representation.
1.The liabilities of Assumption Bank assumed by ArgentBank
and the liabilities, if any, to which the transferred assets
of Assumption Bank are subject, were incurred by Assumption
Bank in the ordinary course of its business.
1.Assumption Bank and the shareholders of Assumption Bank
will pay their respective expenses, if any, incurred in
connection with the Bank Merger (subject to representation
13 below).
1.There is no intercorporate indebtedness existing between
ArgentBank and Assumption Bank that was issued, acquired, or
will be settled at a discount.
1.Assumption Bank is not an investment company as defined in
Code section 368(a)(2)(F)(iii) and (iv).
1.Assumption Bank is not under the jurisdiction of a court
in a Title 11 or similar case within the meaning of section
368(a)(3)(A) of the Code.
1.The fair market value of the assets of Assumption Bank
transferred to ArgentBank will equal or exceed the sum of
the liabilities assumed by ArgentBank, plus the amount of
the liabilities, if any, to which the transferred assets are
subject.
1.The total adjusted basis of the assets of Assumption Bank
transferred to ArgentBank will equal or exceed the sum of
the liabilities to be assumed by ArgentBank, plus the amount
of liabilities, if any, to which the transferred assets are
subject.
1.The payment of cash in lieu of fractional shares of
ArgentBank Common Stock is solely for the purpose of
avoiding the expense and inconvenience to ArgentBank of
issuing fractional shares and does not represent separately
bargained-for consideration. The total cash consideration
that will be paid in the Bank Merger to the Assumption Bank
shareholders instead of issuing fractional shares of
ArgentBank Common Stock will not exceed one percent (1%) of
the total consideration that will be issued in the Bank
Merger to the Assumption Bank shareholders in exchange for
their shares of Assumption Bank Common Stock. The
fractional share interests of each Assumption Bank
shareholder will be aggregated, and no Assumption Bank
shareholder will receive cash (in payment for fractional
share interests) in an amount equal to or greater than the
value of one (1) full share of ArgentBank Common Stock.
1.None of the compensation received by any shareholder-
employee of Assumption Bank pursuant to any employment,
consulting or similar arrangement is or will be separate
consideration for, or allocable to, any of his shares of
Assumption Bank Common Stock; none of the shares of
ArgentBank Common Stock received by any shareholder-employee
of Assumption Bank pursuant to the Bank Merger will be
separate consideration for, or allocable to, any employment
agreement; and the compensation paid to any shareholder-
employee of Assumption Bank pursuant to any employment,
consulting or similar arrangement is or will be for services
actually rendered and will be commensurate with amounts paid
to third parties bargaining at arm's-length for similar
services.
1.ArgentBank will pay or assume only those expenses of
Assumption Bank that are solely and directly related to the
Bank Merger in accordance with the guidelines established in
Rev. Rul. 73-54, 1973-1 C.B. 187.
Assumption Bank hereby certifies that the officer of
the corporation executing this Certificate has knowledge of
the pertinent information set forth herein and that he has
examined the foregoing representations and, to the best of
such officer's knowledge and belief, the representations
made are true, complete and correct as of the date,
______________, 1996, of this Certificate, and he further
certifies that he is duly authorized and empowered to
execute and deliver this Certificate.
ASSUMPTION BANK & TRUST COMPANY
By:
Name: XXXXXX X. XXXXXXX, XX
Title: President & CEO
CERTIFICATE OF ARGENTBANK RELATING TO
SECTION 368 OPINION ON THE BANK MERGER
This Certificate has been requested by the law firm of
Xxxxxxx Xxxxxx & Xxxxxxx, P.A. in connection with the
rendering of its opinion as to certain federal income tax
consequences relating to the merger (the "Bank Merger") of
Assumption Bank & Trust Company ("Assumption Bank") with and
into ArgentBank of Thibodaux, Louisiana ("ArgentBank") as
such transaction is described in that certain Agreement and
Plan of Merger By and Among ArgentBank, Assumption
Bancshares, Inc. ("ABI") and Assumption Bank dated as of
November ____, 1996 (the "Merger Agreement"). Xxxxxxx
Xxxxxx & Xxxxxxx, P. A. will rely on the representations
stated hereinafter, as well as on other facts, assumptions,
and representations described in its opinion letter dated
[____________________, 1996 (date of closing)] (the "WL&S
Tax Opinion") in opining on the federal income tax issues
stated therein. Accordingly, this Certificate is an
integral part of the WL&S Tax Opinion. Unless otherwise
noted, all defined or capitalized terms used in this
Certificate have the same meaning ascribed to such terms in
the Merger Agreement or in the WL&S Tax Opinion.
The following representations are being made in
connection with the Bank Merger:
1.The fair market value of the ArgentBank Common Stock
portion of the Merger Consideration paid by ArgentBank in
the Bank Merger will, on the Effective Date, constitute at
least fifty-one percent (51%) of the fair market value of
the Merger Consideration paid by ArgentBank in the Bank
Merger.
1.ArgentBank has no plan or intention to reacquire any of
the ArgentBank Common Stock issued in the Bank Merger.
1.ArgentBank has no plan or intention to sell or otherwise
dispose of any of the assets of Assumption Bank acquired in
the Bank Merger, except for dispositions made in the
ordinary course of business or transfers described in
section 368(a)(2)(C) of the Code.
1.Following the Bank Merger, ArgentBank will continue the
historic business of Assumption Bank or use a significant
portion of Assumption Bank's historic business assets in a
business.
1.ArgentBank, Assumption Bank and the shareholders of
Assumption Bank will pay their respective expenses, if any,
incurred in connection with the Bank Merger (subject to
representation 8 below).
1.There is no intercorporate indebtedness existing between
ArgentBank and Assumption Bank or between Xxxxxxx Bank and
Assumption Bank that was issued, acquired, or will be
settled at a discount.
1.ArgentBank is not an investment company as defined in Code
section 368(a)(2)(F)(iii) and (iv).
1.ArgentBank will pay or assume only those expenses of
Assumption Bank that are solely and directly related to the
Bank Merger in accordance with the guidelines established in
Rev. Rul. 73-54, 1973-1 C.B. 187.
1.The fair market value of the assets of Assumption Bank
transferred to ArgentBank will equal or exceed the sum of
the liabilities assumed by ArgentBank, plus the amount of
liability, if any, to which the transferred assets are
subject.
1.The payment of cash in lieu of fractional shares of
ArgentBank Common Stock is solely for the purpose of
avoiding the expense and inconvenience to ArgentBank of
issuing fractional shares and does not represent separately
bargained-for consideration. The total cash consideration
that will be paid in the Bank Merger to the Assumption Bank
shareholders instead of issuing fractional shares of
ArgentBank Common Stock will not exceed one percent (1%) of
the total consideration that will be issued in the Bank
Merger to the Assumption Bank shareholders in exchange for
their shares of Assumption Bank Common Stock. The
fractional share interests of each Assumption Bank
shareholder will be aggregated, and no Assumption Bank
shareholder will receive cash (in payment for fractional
share interests) in an amount equal to or greater than the
value of one (1) full share of ArgentBank Common Stock.
ArgentBank hereby certifies that the officer of the
corporation executing this Certificate has knowledge of the
pertinent information set forth herein and that he has
examined the foregoing representations and, to the best of
such officer's knowledge and belief, the representations
made are true, complete and correct as of the date,
________________, 1996, of this Certificate, and he further
certifies that he is duly authorized and empowered to
execute and deliver this Certificate.
ARGENTBANK
By:
Name: XXXXXXX X. XXXXXX
Title: President
EXHIBIT D
AFFILIATES AGREEMENT
DATE
ArgentBank
000 Xxxx Xxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000
Gentlemen:
This letter agreement is given in connection with the
closing of the proposed merger of Assumption Bancshares,
Inc. ("ABI") with and into Assumption Bank & Trust Company
("Assumption Bank") and the proposed merger of Assumption
Bank with and into ArgentBank (the "Mergers"). I am aware
and acknowledge that, as a member of the Board of Directors
or an executive officer or the beneficial owner of a
substantial amount of the outstanding common stock of ABI or
its subsidiary, Assumption Bank, I may be an "affiliate" of
ABI as that term is defined for purposes of paragraphs (c)
and (d) of Rule 145 of the Rules and Regulations of the
Securities and Exchange Commission ("SEC") under the
Securities Act of 1933, as amended (the "Securities Act")
and the rules and regulations thereunder.
I understand that resales or other dispositions of
shares of the Common Stock, $.10 par value, of ArgentBank
(the "ArgentBank Common Stock") to be acquired by me as a
result of the Mergers may be governed by Rules 144 and 145
promulgated under the Securities Act.
I have no plan or intention to sell, exchange, transfer
by gift or otherwise dispose of a number of said securities
to be received in the Mergers that would reduce the former
ABI/Assumption Bank shareholders' ownership of the
ArgentBank Common Stock to a number of shares having a
value, as of the date of the Mergers, of less than 50% of
the value of all of the formerly outstanding ABI/Assumption
Bank Common Stock as of the same date.
Pursuant to Section 7.8 of the Agreement and Plan of
Merger, and as an inducement for ArgentBank to issue the
ArgentBank Common Stock, and other good and valuable
consideration, the sufficiency of which is hereby
acknowledged, I do hereby represent, warrant, and agree that
I shall not make any sale, transfer, or other disposition of
the ArgentBank Common Stock in violation of the Securities
Act or the Rules and Regulations of the SEC.
Sincerely,
EXHIBIT E
TO THE PURCHASE AGREEMENT
TERMS AND CONDITIONS OF EMPLOYMENT OF
XXXXXX X. XXXXXXX
Definitions. Within this exhibit, the following terms
shall have the meanings assigned to them as follows:
"Bank" shall mean Assumption Bank & Trust Company, a
Louisiana state Bank.
"Buyer" shall mean ArgentBank, a Louisiana state bank.
"Executive" shall mean Xxxxxx X. Xxxxxxx, Senior Vice
President of the Bank.
1 Employment Capacity and Term. The Executive will
continue to serve as a Vice President for the Buyer for a
period of eighteen months beginning on the Purchase Date.
1 Duties; Place of Performance. a. Duties. After the
acquisition, the Executive will continue to perform duties
for the Buyer consistent with the duties currently performed
by an executive for the Bank as have been and may be
prescribed by the Board of Directors or the Chief Executive
Officer of the Bank. The Executive will devote all of his
business time and attention to the business of the Buyer and
he will not be employed by any other business or engage in
any other business activity that would materially interfere
with his ability to perform his duties or would constitute a
conflict between his personal or financial interests and the
business or financial interests of the Buyer.
b. Place of Performance. In connection with the
Executive's employment hereunder, the Executive shall be
based in Napoleonville, Louisiana except for required travel
relating to the business of the Buyer.
1 Compensation and Benefits. The Buyer will provide to
the Executive the compensation and benefits described below:
a. Salary. The Buyer will pay to the Executive an
annual salary of not less than $69,280 payable in equal
monthly installments. Additionally, the Executive shall
participate in all executive salary programs maintained by
the Buyer and shall be entitled to salary increases in
amounts awarded to similarly situated executives of the
Buyer and its affiliates.
b. Annual Bonuses. An annual incentive bonus may be
paid with respect to the services provided by the Executive,
in such amount as may be determined from time to time by the
Buyer's Board of Directors or Compensation Committee. The
award of bonuses by the Board of Directors or Compensation
Committee is discretionary and there will be no obligation
on the Buyer to award any bonus to the Executive.
c. Benefits and Perquisites. The Buyer will furnish
the Executive with benefits and perquisites at least as
valuable as those currently maintained by the Bank for its
employees generally, and for its senior executives in
particular, on the same basis and subject to the same
requirements and limitations as may be applicable to senior
executive employees of the Bank as described in the Bank's
current personnel manual.
1 Other Benefits.
a. Expenses. The Executive will be reimbursed by the
Buyer for reasonable out-of-pocket expenses incurred from
time to time on behalf of the Buyer in the performance of
his duties, in accordance with the standard procedures of
the Buyer and upon the presentation of such supporting
invoices, receipts, documents and forms as the Buyer
reasonably requests.
b. Facilities; Secretarial Assistance. The Buyer
will provide the Executive with office space, secretarial
assistance and such other facilities and services as shall
be suitable to the Executive's position and adequate for the
performance of his duties.
1 Termination of Employment.
a. Death. The Executive's status as an employee
shall terminate upon the Executive's death.
b. Disability. If (i) the Executive is incapable
because of physical or mental illness of satisfactorily
discharging his duties for a period of 90 consecutive days
and (ii) a duly qualified physician chosen by the Buyer and
acceptable to the Executive or his legal representatives so
certifies in writing, the Buyer's Board of Directors may
determine that the Executive has become disabled. If the
Buyer's Board of Directors makes such a determination, the
Buyer will have the right, at any time during the period
that such disability continues to terminate the status of
the Executive as an employee by notifying the Executive, in
writing, of such termination. Any such termination shall
become effective 30 days after such notice of termination is
given (the "Disability Effective Date"), unless within such
30-day period the Executive becomes capable of resuming
duties (and a physician chosen by the Buyer and acceptable
to the Executive or his legal representatives so certifies
in writing) and the Executive in fact resumes such duties.
c. By the Buyer for Cause. The Buyer may terminate
the Executive's status as an employee for Cause by notifying
the Executive, in writing, of such termination. As used
herein, "Cause" shall mean (i) the willful and continuing
failure by the Executive to perform his duties (other than
any failure resulting from a certified disability) within a
reasonable period of time after a written demand for
substantial performance is delivered to the Executive by a
duly authorized member or representative of the Buyer's
Board of Directors which specifically identifies the manner
in which it is alleged that the Executive has not
substantially performed such services, (ii) the conviction
of a felony or (iii) the willful engaging by the Executive
in gross misconduct injurious to the Buyer. An act or
failure to act on the Executive's part shall be considered
"willful" if done or omitted to be done without a reasonable
belief that such action or omission was in, or not opposed
to, the best interests of the Buyer. Any act or failure to
act by the Executive that is based upon authority given
pursuant to a resolution duly adopted by the Buyer's Board
of Directors or based upon the advice of counsel for the
Buyer shall be presumed to be done or omitted to be done by
the Executive with a reasonable belief that such action was
in, or not opposed to, the best interests of the Buyer.
Notwithstanding the foregoing, the Executive's employment
may not be terminated for Cause unless and until there shall
have been delivered to the Executive a copy of a resolution
duly adopted by the affirmative vote of not less than three-
fourths of the entire membership of the Buyer's Board of
Directors (not counting the Executive) at a meeting of the
Buyer's Board of Directors held for the purpose (after
reasonable notice to the Executive and an opportunity for
the Executive, together with his counsel, to be heard before
the Buyer's Board of Directors), finding that in the good
faith opinion of the Buyer's Board of Directors the
Executive was guilty of the conduct set forth in clauses
(i), (ii) or (iii) of this paragraph and specifying the
particulars thereof.
d. By the Executive for Good Reason. The Executive
may terminate his status as an employee for Good Reason by
notifying the Buyer, in writing, of such termination. The
termination by the Executive of his status as an employee
for Good Reason shall be deemed to be a justifiable
termination and shall excuse the Executive from further
duties. The term "Good Reason" shall mean:
(i) a diminution in the Executive's duties,
responsibilities or position or the demotion of the
Executive;
(ii) requiring the Executive to be based anywhere
other than in Napoleonville, except for required travel in
the ordinary course of the Buyer's business;
(iii) a reduction in the Executive's annual salary
or a failure to pay to the Executive any installment of his
annual salary or to pay any other amounts required to be
paid under these terms of employment, which failure
continues for a period of 30 days after written notice
thereof is given by the Executive to the Buyer;
(iv) any purported termination of the Executive's
status as an employee which is not effected pursuant to a
Notice of Termination, or which is not justified as a
termination based on Cause; or
(v) any material breach of any of the terms of
employment specified herein by the Buyer which has not been
cured within 30 days following the giving of notice by the
Executive to the Buyer of such breach.
e. Notice of Termination. Notice of termination of
the Executive's status as an employee must be communicated
in a writing delivered to the other party (a "Notice of
Termination"). Any Notice of Termination that purports to
terminate the Executive's employment for Cause or for Good
Reason shall specify the reasons of the party giving such
notice and shall set forth in reasonable detail the facts
and circumstances claimed by such party to provide a basis
for termination of the Executive's employment under the
terms of employment specified herein.
f. Date of Termination. "Employment Termination
Date" means (i) if Executive's employment is terminated by
the Buyer for Cause, or by the Executive for Good Reason,
the date of delivery of the Notice of Termination or any
later date specified therein, as the case may be, (ii) if
the Executive's employment is terminated by the Buyer other
than for Cause or disability, the Date of Termination shall
be the date on which the Buyer notifies the Executive of
such termination and (iii) the if the Executive's employment
is terminated by reason of his death or disability, the Date
of Termination shall be the date of death of the Executive
or the Disability Effective Date, as the case may be.
1 Disability/Death Benefit and Severance Pay.
a. Death. If the Executive's employment is
terminated by his death, in addition to all other death
benefits provided by the Buyer, the Buyer shall pay to the
Executive's spouse or, if he leaves no spouse, to his
estate, in a lump sum in cash within 30 days of the Date of
Termination the sum of the pro rata amount of the
Executive's annual base salary earned through the Date of
Termination to the extent due but not paid and any
compensation previously deferred by the Executive (together
with any accrued interest thereon) and any accrued vacation
pay, in each case to the extent not previously paid
(collectively, "Accrued Obligations"). The Buyer shall also
timely pay or provide to such person any other amounts or
compensation required to be furnished to the Executive under
any benefit plan or arrangement ("Other Benefits").
b. Disability. During any period that the Executive
is deemed to be disabled ("disability period"), the
Executive shall continue to receive his full annual base
salary from the Bank at the rate then in effect for such
period until his employment is terminated, provided that
payments so made to the Executive shall be reduced by the
sum of the amounts, if any, payable to the Executive under
disability benefit plans of the Buyer. Upon termination of
the Executive's employment, the Buyer shall pay to the
Executive in a lump sum in cash within 30 days of the Date
of Termination all Accrued Obligations and shall timely
furnish to the Executive all Other Benefits.
c. Cause. If the Executive's employment shall be
terminated for Cause by the Buyer, or voluntarily terminated
by the Executive other than for Good Reason, the Buyer will
have no further obligation to the Executive other than for
Accrued Obligations, which shall be paid in a lump sum in
cash within 30 days of the Date of Termination, and for
Other Benefits, which the Buyer shall timely furnish to the
Executive.
d. Other than Death, Disability or Cause; Good
Reason. If the Buyer shall terminate the Executive's
employment, other than for death, disability or Cause, or
the Executive shall terminate his employment for Good
Reason, then, in addition to all amounts or compensation to
which he is entitled pursuant to the Buyer's termination
policies and plans then in effect, the Executive will at his
option receive as severance pay either:
(i) continuation of his annual salary (at the
rate in effect as of the Date of Termination) for the
remainder of his eighteen month term of employment, or
(ii) a lump sum payment equal to the then present
value of the aggregate sums described in (i) above, paid by
the Buyer to the Executive no later than fifteen days
following the Date of Termination.
1 Covenant Not to Compete. If the Executive's employment
is terminated by the Buyer for Cause or by the Executive
other than for Good Reason, then for the shorter of the
remainder of the term of employment or two years, the
Executive shall not directly or indirectly (a) solicit any
customers or employees of the Buyer or otherwise disrupt any
previously established relationship existing between a
customer or employee and the Buyer or (b) own, manage,
operate, control, by employed by, participate in, or be
connected in any manner with the ownership, management,
operation or control of any bank, savings and loan
association, financial institution or any other entity
providing lending or deposit services located in Assumption
Parish, Louisiana; provided, however, that the Executive may
own passive investments of not more than 5% of the
outstanding securities of any similar business (but without
otherwise participating in such business) if such securities
are listed on a national or regional securities exchange or
quotations of such securities are published on a national
interdealer quotation system, or are registered under
Sections 12(g) or 15(d) of the Securities Exchange Act of
1934, as amended.
EXHIBIT F
FORM OF TAX OPINION
[Xxxxxxx Xxxxxx & Xxxxxxx, P.A. Letterhead]
[Date of Closing]
Board of Directors Board of Directors
ArgentBank Assumption
Bancshares, Inc.
Xxxx Xxxxxx Xxx 000 000 Xxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000-0000 Xxxx Xxxxxx Xxx 000
Xxxxxxxxxxxxx,
Xxxxxxxxx 00000-0000
Board of Directors
Assumption Bank & Trust Company
000 Xxxxxxxx Xxxxxx
Post Xxxxxx Xxx 000
Xxxxxxxxxxxxx, Xxxxxxxxx 00000-0000
Re:The Federal Income Tax Consequences of Certain
Matters Arising Under the Corporate Reorganization
Provisions of the Internal Revenue Code of 1986, as amended.
Gentlemen:
We have acted as special counsel to ArgentBank of
Thibodaux, Louisiana, a Louisiana state banking association
("ArgentBank"), in connection with certain federal income
tax matters relating to the transactions described in: (a)
that certain Agreement and Plan of Merger, dated as of
November __, 1996 (the "Merger Agreement"), by and among
Assumption Bancshares, Inc., a Louisiana corporation
("ABI"), Assumption Bank & Trust Company, a Louisiana state
banking association ("Assumption Bank"), and (b) that
certain Bank Merger Agreement between Assumption Bank and
ArgentBank, dated as of November ____, 1996 (the "Bank
Merger Agreement"). This opinion is furnished to you
pursuant to Section 8.1(e) of the Merger Agreement. Except
as otherwise defined herein, all capitalized terms herein
have the meanings set forth in the Merger Agreement.
In connection with this opinion, we have examined and
are familiar with originals or copies, certified or
otherwise identified to our satisfaction, of the Merger
Agreement, the Bank Merger Agreement, that certain Company
Merger Agreement between ABI and Assumption Bank, dated as
of November __, 1996 (the "Company Merger Agreement"), and
such other documents as we have deemed necessary or
appropriate in order to enable us to render the opinion
below. In our examination, we have assumed the genuineness
of all signatures, the legal capacity of all natural
persons, the authenticity of all documents submitted to us
as originals, the conformity to original documents of all
documents submitted to us as certified, conformed or
photostatic copies and the authenticity of the originals of
such copies. In rendering the opinion set forth below, we
have relied upon certain written representations and
covenants of the parties to the Mergers set forth in the
Certificates which are attached hereto and incorporated
herein as Exhibits "X," "X," and "C."
In rendering our opinion, we have considered the
applicable provisions of the Internal Revenue Code of 1986,
as amended (the "Code"), Treasury Regulations, pertinent
judicial authorities, interpretive rulings of the Internal
Revenue Service (the "Service") and such other authorities
as we have considered relevant.
I. DESCRIPTION OF PROPOSED COMPANY MERGER
On the Effective Date, prior to the Bank Merger, the
Merger Agreement provides that the Company Merger will
occur. It is our understanding that the proposed Company
Merger will be structured in accordance with the Merger
Agreement, the Company Merger Agreement, the laws of the
State of Louisiana, and will be carried out as follows:
(1)On the Effective Date, ABI will be merged with and
into Assumption Bank on the terms and subject to the
conditions set forth in the Merger Agreement and the Company
Merger Agreement, some of which are further described below.
Assumption Bank will acquire all of the assets and assume
all of the liabilities of ABI. Assumption Bank will be the
surviving corporation and ABI will cease to exist at the
Effective Date of the Company Merger.
(2)On the Effective Date, by virtue of the Company
Merger and without any action on the part of the holders
thereof, each share of ABI Common Stock outstanding
immediately prior to the Effective Date shall be changed and
converted into one fully paid and nonassessable share of
Assumption Bank Common Stock. All treasury shares of each
of ABI and Assumption Bank and all issued and outstanding
shares of Assumption Bank Common Stock owned by ABI shall be
canceled. Except for cash which may be paid with respect to
Dissenting Shares, there will be no cash or other non-stock
consideration exchanged in connection with the Company
Merger.
(3)As a result of the Company Merger, the ABI
shareholders will become shareholders of Assumption Bank.
(4)After the Company Merger, Assumption Bank will
continue its historical business in a substantially
unchanged manner (subject to the Bank Merger).
II. DESCRIPTION OF PROPOSED BANK MERGER
The proposed Bank Merger will be structured in
accordance with the Merger Agreement, the Bank Merger
Agreement, the laws of the State of Louisiana, the
statements and representations of the parties to the
transactions, and the following descriptions:
(1)Immediately after the Company Merger on the
Effective Date, Assumption Bank will be merged with and into
ArgentBank on the terms and subject to the conditions set
forth in the Merger Agreement and the Bank Merger Agreement,
some of which are further described below. ArgentBank will
acquire all of the assets and assume all of the liabilities
of Assumption Bank. ArgentBank will continue in existence
as the surviving corporation. Assumption Bank will cease to
exist at the Effective Time of the Bank Merger.
(2)Except for (a) shares as to which dissenters'
rights, if any, have been perfected and not withdrawn or
otherwise forfeited under applicable Louisiana law
("Dissenting Shares"), and (b) shares held by certain "Small
Bank Shareholders" as described below, each issued and
outstanding share of Assumption Bank Common Stock
(immediately after the Company Merger) shall automatically
be exchanged for and converted into the right to receive
from ArgentBank (i) a number of shares of ArgentBank Common
Stock established by formula as provided in Section 3.2(a)
of the Merger Agreement (the "Conversion Number" of shares),
or (ii) the right to receive $134.375 in cash (the "Cash
Payment") ((i) and (ii) together, the "Merger
Consideration"); provided, however, that pursuant to Section
3.2(b) of the Merger Agreement, the individual shareholders
of Assumption Bank may elect to receive a combination of the
Conversion Number of shares of ArgentBank Common Stock and
the Cash Payment, with the further caveat that Total Cash
Payments (which consists of Elected Cash Payments, the Cash
Payments that will be made in exchange for De Minimis
Holdings, the amount of cash paid in lieu of fractional
shares, and the amount of cash paid with respect to
Dissenting Shares of Assumption Bank Common Stock) shall be
limited to $10,535,000, which is 49% of the Aggregate Merger
Consideration Value of $21.5 million as defined in Section
3.2(a) of the Merger Agreement. In addition, Section 3.2(b)
of the Merger Agreement provides that ArgentBank shall have
the right to increase the Elected Cash Payments made so that
the Total Cash Payments shall equal not less than
$8,600,000, which is 40% of the Aggregate Merger
Consideration Value. Thus, depending on the outcome of the
election of each Assumption Bank shareholder, between 51%
and 60% of the Aggregate Merger Consideration Value will be
in the form of ArgentBank Common Stock, and between 40% and
49% of the Aggregate Merger Consideration Value will be in
the form of cash.
(3)Pursuant to Section 3.2(a) of the Merger Agreement,
each holder of 15 or fewer shares of Assumption Bank Common
Stock (a "Small Bank Shareholder"), shall not be entitled to
elect to receive ArgentBank Common Stock, but rather shall
only be entitled to receive as consideration from
ArgentBank, the Cash Payment for each share of Assumption
Bank Common Stock held.
(4)If after calculation of the Conversion Number of
shares, an Assumption Bank shareholder is entitled to
receive a fraction of a share of ArgentBank Common Stock, no
such fractional share will be issued. In lieu thereof, cash
will be paid to such shareholder in an amount equal to such
fractional part of a share of ArgentBank Common Stock
multiplied by the Average Market Price of a share of
ArgentBank Common Stock (see Section 3.3(h) of the Merger
Agreement).
(5)As a result of the Bank Merger, the Assumption Bank
shareholders other than those who elect all Cash Payments,
the Small Bank Shareholders and those Bank shareholders who
perfect any applicable dissenters' rights, will become
shareholders of ArgentBank.
(6)After the Bank Merger, ArgentBank will continue its
historical business and the historical banking business of
Assumption Bank in a substantially unchanged manner.
III. OPINION
In reliance upon the foregoing facts and the
representations of the parties to the Merger transactions,
and based upon our review of such documents and
consideration of such legal matters as we have deemed
relevant and sufficient to enable us to render an informed
opinion, and provided that the Mergers are consummated in
accordance with the terms and conditions set forth in the
respective Merger Agreements, we are of the opinion that the
federal income tax consequences of the proposed Mergers will
be as follows:
A. With respect to the Company Merger:
1.Provided the proposed Company Merger of ABI with
and into Assumption Bank qualifies as a statutory merger
under applicable Louisiana law, the acquisition by
Assumption Bank of all of the assets of ABI in exchange for
the Assumption Bank Common Stock and the assumption of
liabilities of ABI will constitute a reorganization within
the meaning of Code section 368(a)(1)(A).[1] The Company
Merger will also be the type of transaction described in
section 368(a)(1)(D) of the Code. ABI and Assumption Bank
will each be "a party to a reorganization" within the
meaning of section 368(b) of the Code.
0.Xx gain or loss will be recognized to ABI on the
transfer of all of its assets to Assumption Bank in exchange
for the Assumption Bank Common Stock and the assumption by
Assumption Bank of the liabilities of ABI (Code sections
361(b)(1)(A) and 357(a)).
0.Xx gain or loss will be recognized to Assumption
Bank upon its receipt of all of the assets of ABI in
exchange for the Assumption Bank Common Stock
paid to the ABI shareholders and the assumption by
Assumption Bank of the liabilities of ABI and the
liabilities to which the transferred assets are subject
(Rev. Rul. 57-278, 1957-1 C.B. 124).
0.Xx gain or loss will be recognized by the
shareholders of ABI who receive solely Assumption Bank
Common Stock (including fractional share interests to which
they may be entitled) in exchange for their ABI Common Stock
(Code section 354(a)(1)).
5.The basis of the Assumption Bank Common Stock to
be received by the ABI shareholders (including any
fractional share interests to which they may be entitled)
will be, in each instance, the same as the basis of the ABI
Common Stock surrendered in exchange therefor. (Code section
358(a)(1)).
6.The holding period of the Assumption Bank Common
Stock to be received by the ABI shareholders (including any
fractional share interests to which they may be entitled)
will include, in each case, the period during which the ABI
Common Stock surrendered in exchange therefor was held,
provided that the ABI Common Stock is held as a capital
asset in the hands of the ABI shareholder on the Effective
Date of the Company Merger (Code section 1223(1)).
B. With Respect to the Bank Merger:
1.Provided the proposed Bank Merger of Assumption
Bank with and into ArgentBank qualifies as a statutory
merger under applicable Louisiana law, the acquisition by
ArgentBank of all of the assets of Assumption Bank in
exchange for the Aggregate Merger Consideration Value and
the assumption of liabilities of Assumption Bank will
constitute a reorganization within the meaning of Code
section 368(a)(1)(A). ArgentBank and Assumption Bank will
each be "a party to a reorganization" within the meaning of
section 368(b) of the Code.
0.Xx gain or loss will be recognized to Assumption
Bank on the transfer of all of its assets to ArgentBank in
exchange for the Aggregate Merger Consideration Value (all
of which will be distributed to the Assumption Bank
shareholders), and the assumption by ArgentBank of the
liabilities of Assumption Bank and the liabilities to which
the transferred assets are subject (Code sections
361(b)(1)(A) and 357(a)).
0.Xx gain or loss will be recognized to ArgentBank
upon the receipt by ArgentBank of all of the assets of
Assumption Bank in exchange for the Aggregate Merger
Consideration Value paid to the Assumption Bank shareholders
and the assumption by ArgentBank of the liabilities of
Assumption Bank and the liabilities to which the transferred
assets are subject (Rev. Rul. 57-278, 1957-1 C.B. 124).
0.Xx gain or loss will be recognized by any
shareholders of Assumption Bank who receive solely
ArgentBank Common Stock (including fractional share
interests to which they may be entitled) in exchange for
their Assumption Bank Common Stock (Code section 354(a)(1)).
5.Gain, if any, will be realized by the Assumption
Bank shareholders who receive ArgentBank Common Stock and
cash (i.e., those who elect a combination of ArgentBank
Common Stock and the Cash Payment as the Merger
Consideration) in exchange for their Assumption Bank Common
Stock. Such gain will be recognized, but not in excess, in
each instance, of the sum of such cash received (section
356(a)(1)). If the exchange has the effect of the
distribution of a dividend (determined with the application
of section 318(a)), then the amount of the gain recognized
that is not in excess of the Assumption Bank shareholder's
ratable share of undistributed earnings and profits will be
treated as a dividend (section 356(a)(2)). The
determination of whether the exchange has the effect of the
distribution of a dividend must be made on a shareholder by
shareholder basis in accordance with the principles set
forth in Commissioner x. Xxxxx, 000 X.X. 000 (1989), Rev.
Rul. 93-61, 0000-0 X.X. 000, xxx Xxxxxx Xxxxxx x. Xxxxx, 000
X.X. 000 (1970). The remainder, if any, of the gain
recognized will be treated as gain from the exchange of
property. No loss will be recognized on the exchange of
Assumption Bank Common Stock for the combined stock and cash
Merger Consideration (section 356(c)).
6.Where a dissenting Assumption Bank shareholder
receives solely cash in exchange for all of his or her
Assumption Bank Common Stock, such cash will be treated as
having been received by the shareholder as a distribution in
redemption of his or her stock subject to the provisions and
limitations of section 302.
7.Where a Small Bank Shareholder receives solely
cash in exchange for all of his or her Assumption Bank
Common Stock, such cash will be treated as having been
received by the shareholder as a distribution in redemption
of his or her stock subject to the provisions and
limitations of section 302.
8.The basis of the ArgentBank Common Stock to be
received by certain Assumption Bank shareholders (including
any fractional share interests to which they may be
entitled) will be, in each instance, the same as the basis
of the Assumption Bank Common Stock surrendered in exchange
therefor, decreased by the amount of cash received, and
increased by (i) the amount that is treated as a dividend,
and (ii) any gain recognized on the exchange (not including
any portion of the gain that is treated as a dividend) (Code
section 358(a)(1)).
9.The holding period of the ArgentBank Common
Stock to be received by certain Assumption Bank shareholders
(including any fractional share interests to which they may
be entitled) will include, in each case, the period during
which the Assumption Bank Common Stock surrendered in
exchange therefor was held, provided that the Assumption
Bank Common Stock is held as a capital asset in the hands of
the Assumption Bank shareholder on the Effective Date of the
Bank Merger (Code section 1223(1)).
10.The payment of cash to Assumption Bank
shareholders in lieu of fractional shares of ArgentBank
Common Stock will be treated for federal income tax purposes
as if the fractional shares were distributed as part of the
reorganization exchange and then redeemed by ArgentBank.
The cash payments will be treated as having been received as
distributions in redemption of such stock, subject to the
provisions and limitations of section 302 of the Code (Rev.
Rul. 66-365, 1966-2 C.B. 116; Rev. Proc. 77-41, 1977-2 C.B.
574).
We have qualified our opinions by reference to the
Code, the Treasury Regulations promulgated thereunder, and
existing judicial and administrative interpretations
thereof. In so opining, we have relied upon the foregoing
facts and representations and have reviewed such documents
and have considered such legal matters as we have deemed
relevant and sufficient to enable us to render an informed
opinion. While we have not been requested nor have we
undertaken to make independent investigations to verify the
representations and statements described above or set forth
in the Certificates attached as Exhibits "X," "X," and "C,"
based upon our discussions with representatives of the
parties and our limited review of certain background
material, we believe that it is reasonable for us to rely on
such representations and statements.
Our opinion is limited to the specific opinions
expressed above, and no other opinions are intended nor
should they be inferred. An opinion of counsel has no
binding effect upon the Service and no assurances can be
given that the conclusions reached in any opinion will not
be contested by the Service, or if contested, will be
sustained by a court.
The opinions we have expressed above are based on the
facts and representations outlined herein being correct in
all material respects as of the dates indicated or at the
time of the proposed transactions as the case may be. In
the event that one or more of the facts or representations
are incorrect for any such time, our opinion would likely be
substantially different than that expressed above.
The opinion expressed herein is for the sole benefit of
ArgentBank, ABI and Assumption Bank, together with their
respective shareholders for their use in connection with the
proposed Mergers, and is not to be used, delivered to or
relied upon by any other party for any other purpose, and
may not be circulated, quoted, or otherwise referred to for
any other purpose without our prior written consent.
Very truly yours,
/s/XXXXXXX XXXXXX & XXXXXXX, P.A.
**FOOTNOTES**
[1]:/Unless otherwise noted, hereafter all section
references are to the Code.
Exhibit "A" to Tax Opinion
CERTIFICATE OF ASSUMPTION BANK & TRUST COMPANY
RELATING TO SECTION 368 OPINION ON THE BANK MERGER
This Certificate has been requested by the law firm of
Xxxxxxx Xxxxxx & Xxxxxxx, P.A. in connection with the
rendering of its opinion as to certain federal income tax
consequences relating to the merger (the "Bank Merger") of
Assumption Bank & Trust Company ("Assumption Bank") with and
into ArgentBank of Thibodaux, Louisiana ("ArgentBank") as
such transaction is described in that certain Agreement and
Plan of Merger By and Among ArgentBank, Assumption
Bancshares, Inc. and Assumption Bank dated as of November
____, 1996 (the "Merger Agreement"). Xxxxxxx Xxxxxx &
Xxxxxxx, P. A. will rely on the representations stated
hereinafter, as well as on other facts, assumptions, and
representations described in its opinion letter dated
[____________________, 1996 (date of closing)] (the "WL&S
Tax Opinion") in opining on the federal income tax issues
stated therein. Accordingly, this Certificate is an
integral part of the WL&S Tax Opinion. Unless otherwise
noted, all defined or capitalized terms used in this
Certificate have the same meaning ascribed to such terms in
the Merger Agreement or in the WL&S Tax Opinion.
The following representations are being made in
connection with the Bank Merger:
1.The fair market value of the ArgentBank Common Stock and
other consideration (collectively, the "Merger
Consideration") received by each Assumption Bank
shareholder in the Bank Merger exchange will be
approximately equal to the fair market value of the
Assumption Bank Common Stock surrendered in the exchange.
1.The aggregate fair market value of the ArgentBank Common
Stock portion of the Merger Consideration will, on the
Effective Date of the Bank Merger, constitute at least
fifty-one percent (51%) of the total fair market value of
the Merger Consideration exchanged in the Bank Merger.
1.There is no plan or intention by the shareholders of
Assumption Bank who own one percent (1%) or more of the
Assumption Bank Common Stock, and to the best of the
knowledge of management of Assumption Bank there is no plan
or intention on the part of the remaining shareholders of
Assumption Bank, to sell, exchange, or otherwise dispose of
a number of shares of ArgentBank Common Stock received in
the Bank Merger that would collectively reduce the
Assumption Bank shareholders' ownership of ArgentBank Common
Stock to a number of shares having a value, as of the
Effective Date of the Bank Merger, of less than fifty
percent (50%) of the value of all of the formerly
outstanding stock of Assumption Bank as of the same date.
For purposes of this representation, shares of Assumption
Bank Common Stock exchanged for cash in lieu of fractional
shares of ArgentBank Common Stock, exchanged for cash or
other property, or surrendered by dissenters will be treated
as outstanding shares of Assumption Bank Common Stock on the
date of the Bank Merger. Moreover, shares of Assumption
Bank Common Stock and shares of ArgentBank Common Stock held
by Assumption Bank shareholders and otherwise sold,
redeemed, or disposed of prior or subsequent to the Bank
Merger will be considered as part of this representation.
1.The liabilities of Assumption Bank assumed by ArgentBank
and the liabilities, if any, to which the transferred assets
of Assumption Bank are subject, were incurred by Assumption
Bank in the ordinary course of its business.
1.Assumption Bank and the shareholders of Assumption Bank
will pay their respective expenses, if any, incurred in
connection with the Bank Merger (subject to representation
13 below).
1.There is no intercorporate indebtedness existing between
ArgentBank and Assumption Bank that was issued, acquired, or
will be settled at a discount.
1.Assumption Bank is not an investment company as defined in
Code section 368(a)(2)(F)(iii) and (iv).
1.Assumption Bank is not under the jurisdiction of a court
in a Title 11 or similar case within the meaning of section
368(a)(3)(A) of the Code.
1.The fair market value of the assets of Assumption Bank
transferred to ArgentBank will equal or exceed the sum of
the liabilities assumed by ArgentBank, plus the amount of
the liabilities, if any, to which the transferred assets are
subject.
1.The total adjusted basis of the assets of Assumption Bank
transferred to ArgentBank will equal or exceed the sum of
the liabilities to be assumed by ArgentBank, plus the amount
of liabilities, if any, to which the transferred assets are
subject.
1.The payment of cash in lieu of fractional shares of
ArgentBank Common Stock is solely for the purpose of
avoiding the expense and inconvenience to ArgentBank of
issuing fractional shares and does not represent separately
bargained-for consideration. The total cash consideration
that will be paid in the Bank Merger to the Assumption Bank
shareholders instead of issuing fractional shares of
ArgentBank Common Stock will not exceed one percent (1%) of
the total consideration that will be issued in the Bank
Merger to the Assumption Bank shareholders in exchange for
their shares of Assumption Bank Common Stock. The
fractional share interests of each Assumption Bank
shareholder will be aggregated, and no Assumption Bank
shareholder will receive cash (in payment for fractional
share interests) in an amount equal to or greater than the
value of one (1) full share of ArgentBank Common Stock.
1.None of the compensation received by any shareholder-
employee of Assumption Bank pursuant to any employment,
consulting or similar arrangement is or will be separate
consideration for, or allocable to, any of his shares of
Assumption Bank Common Stock; none of the shares of
ArgentBank Common Stock received by any shareholder-employee
of Assumption Bank pursuant to the Bank Merger will be
separate consideration for, or allocable to, any employment
agreement; and the compensation paid to any shareholder-
employee of Assumption Bank pursuant to any employment,
consulting or similar arrangement is or will be for services
actually rendered and will be commensurate with amounts paid
to third parties bargaining at arm's-length for similar
services.
1.ArgentBank will pay or assume only those expenses of
Assumption Bank that are solely and directly related to the
Bank Merger in accordance with the guidelines established in
Rev. Rul. 73-54, 1973-1 C.B. 187.
Assumption Bank hereby certifies that the officer of
the corporation executing this Certificate has knowledge of
the pertinent information set forth herein and that he has
examined the foregoing representations and, to the best of
such officer's knowledge and belief, the representations
made are true, complete and correct as of the date,
______________, 1996, of this Certificate, and he further
certifies that he is duly authorized and empowered to
execute and deliver this Certificate.
ASSUMPTION BANK & TRUST COMPANY
By:
Name: XXXXXX X. XXXXXXX, XX
Title: President & CEO
Exhibit "B" to Tax Opinion
CERTIFICATE OF ARGENTBANK RELATING TO
SECTION 368 OPINION ON THE BANK MERGER
This Certificate has been requested by the law firm of
Xxxxxxx Xxxxxx & Xxxxxxx, P.A. in connection with the
rendering of its opinion as to certain federal income tax
consequences relating to the merger (the "Bank Merger") of
Assumption Bank & Trust Company ("Assumption Bank") with and
into ArgentBank of Thibodaux, Louisiana ("ArgentBank") as
such transaction is described in that certain Agreement and
Plan of Merger By and Among ArgentBank, Assumption
Bancshares, Inc. ("ABI") and Assumption Bank dated as of
November ____, 1996 (the "Merger Agreement"). Xxxxxxx
Xxxxxx & Xxxxxxx, P. A. will rely on the representations
stated hereinafter, as well as on other facts, assumptions,
and representations described in its opinion letter dated
[____________________, 1996 (date of closing)] (the "WL&S
Tax Opinion") in opining on the federal income tax issues
stated therein. Accordingly, this Certificate is an
integral part of the WL&S Tax Opinion. Unless otherwise
noted, all defined or capitalized terms used in this
Certificate have the same meaning ascribed to such terms in
the Merger Agreement or in the WL&S Tax Opinion.
The following representations are being made in
connection with the Bank Merger:
1.The fair market value of the ArgentBank Common Stock
portion of the Merger Consideration paid by ArgentBank in
the Bank Merger will, on the Effective Date, constitute at
least fifty-one percent (51%) of the fair market value of
the Merger Consideration paid by ArgentBank in the Bank
Merger.
2.ArgentBank has no plan or intention to reacquire any of
the ArgentBank Common Stock issued in the Bank Merger.
3.ArgentBank has no plan or intention to sell or otherwise
dispose of any of the assets of Assumption Bank acquired in
the Bank Merger, except for dispositions made in the
ordinary course of business or transfers described in
section 368(a)(2)(C) of the Code.
4.Following the Bank Merger, ArgentBank will continue the
historic business of Assumption Bank or use a significant
portion of Assumption Bank's historic business assets in a
business.
5.ArgentBank, Assumption Bank and the shareholders of
Assumption Bank will pay their respective expenses, if any,
incurred in connection with the Bank Merger (subject to
representation 8 below).
6.There is no intercorporate indebtedness existing between
ArgentBank and Assumption Bank or between Xxxxxxx Bank and
Assumption Bank that was issued, acquired, or will be
settled at a discount.
7.ArgentBank is not an investment company as defined in Code
section 368(a)(2)(F)(iii) and (iv).
8.ArgentBank will pay or assume only those expenses of
Assumption Bank that are solely and directly related to the
Bank Merger in accordance with the guidelines established in
Rev. Rul. 73-54, 1973-1 C.B. 187.
9.The fair market value of the assets of Assumption Bank
transferred to ArgentBank will equal or exceed the sum of
the liabilities assumed by ArgentBank, plus the amount of
liability, if any, to which the transferred assets are
subject.
10.The payment of cash in lieu of fractional shares of
ArgentBank Common Stock is solely for the purpose of
avoiding the expense and inconvenience to ArgentBank of
issuing fractional shares and does not represent separately
bargained-for consideration. The total cash consideration
that will be paid in the Bank Merger to the Assumption Bank
shareholders instead of issuing fractional shares of
ArgentBank Common Stock will not exceed one percent (1%) of
the total consideration that will be issued in the Bank
Merger to the Assumption Bank shareholders in exchange for
their shares of Assumption Bank Common Stock. The
fractional share interests of each Assumption Bank
shareholder will be aggregated, and no Assumption Bank
shareholder will receive cash (in payment for fractional
share interests) in an amount equal to or greater than the
value of one (1) full share of ArgentBank Common Stock.
ArgentBank hereby certifies that the officer of the
corporation executing this Certificate has knowledge of the
pertinent information set forth herein and that he has
examined the foregoing representations and, to the best of
such officer's knowledge and belief, the representations
made are true, complete and correct as of the date,
________________, 1996, of this Certificate, and he further
certifies that he is duly authorized and empowered to
execute and deliver this Certificate.
ARGENTBANK
By:
Name: XXXXXXX X. XXXXXX
Title: President
Exhibit "C" to Tax Opinion
CERTIFICATE OF ASSUMPTION BANCSHARES, INC. AND ASSUMPTION
BANK
RELATING TO SECTION 368 OPINION ON THE COMPANY MERGER
This Certificate has been requested by the law firm of
Xxxxxxx Xxxxxx & Xxxxxxx, P.A. in connection with the
rendering of its opinion as to certain federal income tax
consequences relating to the merger (the "Company Merger")
of Assumption Bancshares, Inc. ("ABI") with and into
Assumption Bank & Trust Company ("Assumption Bank") as such
transaction is described in that certain Agreement and Plan
of Merger By and Among ArgentBank of Thibodaux, Louisiana
("ArgentBank") ABI and Assumption Bank dated as of November
____, 1996 (the "Merger Agreement"). Xxxxxxx Xxxxxx &
Xxxxxxx, P. A. will rely on the representations stated
hereinafter, as well as on other facts, assumptions, and
representations described in its opinion letter dated
[____________________, 1996 (date of closing)] (the "WL&S
Tax Opinion") in opining on the federal income tax issues
stated therein. Accordingly, this Certificate is an
integral part of the WL&S Tax Opinion. Unless otherwise
noted, all defined or capitalized terms used in this
Certificate have the same meaning ascribed to such terms in
the Merger Agreement or in the WL&S Tax Opinion.
The following representations are being made in
connection with the Company Merger:
1.The fair market value of the Assumption Bank Common Stock
received in the Company Merger exchange by each ABI
shareholder will be approximately equal to the fair market
value of the ABI Common Stock surrendered in the exchange.
2.Except for the statutory merger of Assumption Bank with
and into ArgentBank, which is intended to qualify as a
reorganization under section 368(a)(1)(A) of the Code, there
is no plan or intention by the shareholders of ABI who own
one percent (1%) or more of the ABI Common Stock, and to the
best of the knowledge of management of ABI there is no plan
or intention on the part of the remaining shareholders of
ABI, to sell, exchange, or otherwise dispose of a number of
shares of Assumption Bank Common Stock received in the
Company Merger that would reduce the ABI shareholders'
ownership of Assumption Bank Common Stock to a number of
shares having a value, as of the Effective Date of the
Company Merger, of less than fifty percent (50%) of the
value of all of the formerly outstanding stock of ABI as of
the same date. For purposes of this representation, shares
of ABI Common Stock exchanged for cash in lieu of fractional
shares of Assumption Bank Common Stock, exchanged for cash
or other property, or surrendered by dissenters will be
treated as outstanding shares of ABI Common Stock on the
date of the Company Merger. Moreover, shares of ABI Common
Stock and shares of Assumption Bank Common Stock held by ABI
shareholders and otherwise sold, redeemed, or disposed of
prior or subsequent to the Company Merger will be considered
in making this representation.
3.ABI will transfer and Assumption Bank will acquire at
least 90 percent of the fair market value of the net assets
and at least 70 percent of the fair market value of the
gross assets held by ABI immediately prior to the Company
Merger. For purposes of this representation, amounts paid
by ABI to dissenters, assets used by ABI to pay its
reorganization expenses, amounts paid by ABI to shareholders
who receive cash or other property in connection with the
Company Merger, and all redemptions and distributions
(except for regular, normal dividends) made by ABI
immediately preceding the Company Merger, will be included
as assets of ABI held immediately prior to the Company
Merger.
4.Immediately after the Company Merger, the shareholders of
ABI will be in control of Assumption Bank within the meaning
of section 368(c) of the Code.
5.Assumption Bank has no plan or intention to reacquire any
of its stock issued in the Company Merger.
6.Assumption Bank has no plan or intention to sell or
otherwise dispose of any assets of ABI acquired in the
Company Merger, except for (i) dispositions made in the
ordinary course of business, or (ii) transfers in connection
with the Bank Merger.
7.ABI will distribute the stock, securities, and other
property it receives in the Company Merger (if any), and its
other properties, in pursuance of the plan of
reorganization.
8. The liabilities of ABI assumed by Assumption Bank and the
liabilities, if any, to which the transferred assets of ABI
are subject, were incurred by ABI in the ordinary course of
its business.
9.Following the transaction, Assumption Bank will continue
the historic business of ABI, or use a significant portion
of ABI's historic business assets in a business, subject to
the Bank Merger.
10.ABI, Assumption Bank and the shareholders of ABI will pay
their respective expenses, if any, incurred in connection
with the Company Merger (subject to representation 19
below).
11.There is no intercorporate indebtedness existing between
Assumption and ABI that was issued, acquired, or will be
settled at a discount.
12.Neither ABI nor Assumption Bank is an investment company
as defined in Code section 368(a)(2)(F)(iii) and (iv).
13.Assumption Bank does not own, directly or indirectly, nor
has it owned during the past five years, directly or
indirectly, any stock of ABI.
14.The fair market value of the assets of ABI transferred to
Assumption Bank will equal or exceed the sum of the
liabilities assumed by Assumption Bank, plus the amount of
the liabilities, if any, to which the transferred assets are
subject.
15.The total adjusted basis of the assets of ABI transferred
to Assumption Bank will equal or exceed the sum of the
liabilities to be assumed by Assumption Bank, plus the
amount of liabilities, if any, to which the transferred
assets are subject.
16. ABI is not under the jurisdiction of a court in a Title
11 or similar case within the meaning of section
368(a)(3)(A) of the Code.
17.There will be no cash paid for fractional shares in
connection with the Company Merger.
1.None of the compensation received by any shareholder-
employee of ABI pursuant to any employment, consulting or
similar arrangement is or will be separate consideration
for, or allocable to, any of his shares of ABI Common
Stock; none of the shares of Assumption Bank Common Stock
received by any shareholder-employee of ABI pursuant to the
Company Merger will be separate consideration for, or
allocable to, any employment agreement; and the compensation
paid to any shareholder-employee of ABI pursuant to any
employment, consulting or similar arrangement is or will be
for services actually rendered and will be commensurate with
amounts paid to third parties bargaining at arm's-length for
similar services.
18.Assumption Bank will pay or assume only those expenses of
ABI that are solely and directly related to the Company
Merger in accordance with the guidelines established in Rev.
Rul. 73-54, 1973-1 C.B. 187.
ABI and Assumption Bank hereby certify that the officer
of the named corporation executing this Certificate has
knowledge of the pertinent information set forth herein and
that he has examined the foregoing representations and, to
the best of such officer's knowledge and belief, the
representations made are true, complete and correct as of
the date, ______________, 1996, of this Certificate, and
each officer further certifies that he is duly authorized
and empowered to execute and deliver this Certificate.
ASSUMPTION BANCSHARES, INC.
By:
Name: XXXXXX X. XXXXXXX, XX
Title: President and CEO
ASSUMPTION BANK & TRUST COMPANY
By:
Name: XXXXXX X. XXXXXXX, XX
Title: President & CEO
