Exhibit 99.2
MERGER AGREEMENT
DATED AS OF: May 22, 2003
PARTIES: Marquette Financial Companies ("Marquette")
0000 Xxxx Xxxxxxxx Xxxxx
00 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxxxx, XX 00000-0000
Valley Bancorp, Inc. ("Valley")
0000 X. Xxxxxxx Xxx. #000
Xxxxxxx XX 00000-0000
United Financial Corp. ("UFC")
P. O. Box 2779
000 Xxxxx Xxxxxx Xxxxx
Xxxxx Xxxxx XX 00000
RECITALS:
A. Marquette is a registered bank holding company under the Bank
Holding Company Act of 1956, as amended (the "BHC Act").
B. Valley is a registered bank holding company under the BHC Act, and
owns 100% of the capital stock of Valley Bank of Arizona (the "Bank").
C. UFC is a registered bank holding company under the BHC Act, and owns
1,125,293 shares (65.3%) of the common stock of Valley (the "UFC Shares").
D. The Board of Directors of each of Valley and Marquette has
determined that it would be in the best interests of such party and its
shareholders to merge Valley with a wholly-owned subsidiary of Marquette
("Newco"), subject to the terms and conditions of this Agreement (the "Merger").
E. The Board of Directors of Valley has approved this Agreement and the
Plan of Merger attached hereto as Exhibit A (the "Plan of Merger"), has
authorized the execution, delivery and performance of this Agreement and the
Plan of Merger, and has directed the submission of this Agreement and the Plan
of Merger to its shareholders with the recommendation that it be approved.
F. The Board of Directors of Marquette has approved this Agreement, has
authorized the execution, delivery and performance of this Agreement and,
subject to the terms and conditions of this Agreement, shall cause Newco to
approve the Plan of Merger.
AGREEMENTS:
IN CONSIDERATION of the mutual covenants set forth herein and for other
good and valuable consideration the receipt and sufficiency of which are hereby
acknowledged, the parties agree as follows:
ARTICLE 1
THE MERGER
1.1) Merger. At the Effective Time (as defined below), pursuant to the
provisions of this Agreement, the Plan of Merger and the Arizona Business
Corporation Act (the "Act"), Newco shall be merged with and into Valley and the
separate existence of Newco shall thereupon cease. After the Effective Time, the
existence and corporate organization of Valley (the "Surviving Corporation")
shall continue in effect as the surviving corporation, until such time as it may
be merged with another entity or otherwise liquidated. The name of the Surviving
Corporation shall be "Valley Bancorp, Inc."
1.2) Articles of Incorporation and Bylaws of Surviving Corporation. At
the Effective Time, the Articles of Incorporation and Bylaws of Valley
immediately prior to the Effective Time shall constitute and be the Articles of
Incorporation and Bylaws of the Surviving Corporation until amended or changed
as provided therein or by law.
1.3) Board of Directors of Surviving Corporation. At the Effective Time
and continuing thereafter, the members of the Board of Directors of Newco
immediately prior to the Effective Time shall be the members of the Board of
Directors of the Surviving Corporation until such board may be changed or
reconstituted as provided by the Articles of Incorporation or Bylaws of the
Surviving Corporation, or by law.
1.4) Officers of Surviving Corporation. At the Effective Time and
continuing thereafter, the officers of Newco immediately prior to the Effective
Time shall be the officers of the Surviving Corporation until such officers may
be changed as provided by the Articles of Incorporation or Bylaws of the
Surviving Corporation, or by law.
1.5) Certain Effects of the Merger. At the Merger Effective Time, the
Surviving Corporation shall succeed to and possess all the assets, rights,
privileges, powers, franchises and immunities, and be subject to all
liabilities, restrictions, disabilities, and duties of both Newco and Valley;
and all the assets, rights, privileges, powers, franchises and immunities of
Newco and Valley and all properties, real, personal and mixed, and all other
interests or things in action of or belonging to Newco or Valley, shall be
vested in the Surviving Corporation and shall be thereafter as effectively the
property of the Surviving Corporation as they were or would be of Newco or
Valley; and title to any real estate or any interest therein vested by deed or
otherwise in Newco or Valley shall not revert or be in any way impaired by any
reason of the Merger; provided, however, that all rights of creditors and all
liens upon any property of Newco or Valley shall be preserved unimpaired,
limited in lien to the property affected by such liens at the Effective Time,
and all debts, liabilities and duties of Newco or Valley shall become those of
the Surviving Corporation and may be enforced against the Surviving Corporation
to the same extent as if incurred or contracted by the Surviving Corporation.
1.6) Further Assurances. After the Effective Time, the appropriate
officers or directors of Newco or Valley, as the case may be, are hereby
authorized to execute, acknowledge and deliver all such instruments of further
assurance and to do all other acts or things as may be requisite or desirable to
carry out the provisions of this Agreement and the Plan of Merger.
ARTICLE 2
TERMS OF MERGER
2.1) Conversion of Shares.
(a) Newco Shares. At the Effective Time, each share of stock of Newco
then outstanding shall, by virtue of the Merger and without any further
action on the part of the holder thereof, be converted into and
thereafter shall constitute one share of common stock of the Surviving
Corporation.
(b) Valley Shares. At the Effective Time, each share of common stock of
Valley then outstanding shall, by virtue of the Merger and without any
further action on the part of the holder thereof, be converted into and
thereafter shall constitute the right to receive cash ("Cash Payment")
equal to the Conversion Price (defined below).
(c) Conversion Price. The "Conversion Price" for each share of common
stock of Valley then outstanding shall equal the Aggregate Conversion
Price divided by the total number of shares of common stock of Valley
outstanding as of the Closing Date (defined below), including shares
issued on the Closing Date in connection with the exercise of the Stock
Options (defined below). The "Aggregate Conversion Price" for all of
the issued and outstanding capital stock of Valley shall be the sum of
(x) Fourteen Million Four Hundred Thousand Dollars ($14,400,000), minus
(y) the amount of the Davidson Fees paid or payable by Valley (as
further described in Section 4.17), plus (z) the amount, if any, paid
to Valley after January 1, 2003 in connection with the exercise of the
Stock Options, as hereinafter defined.
(d) Valley Dissenting Shares. Each share of Valley common stock
outstanding immediately prior to the Effective Time, the holder of
which has, as of the Closing Date, perfected and preserved dissenters'
rights to be paid fair value for such shares under the Act (such shares
referred to as "Dissenting Shares"), shall not represent a right to
receive a Cash Payment pursuant to Section 2.1(b). The holders of
Dissenting Shares shall be entitled only to such rights as are granted
by the Act. Each holder of Dissenting Shares who becomes entitled to
payment for such holder's Valley common stock pursuant to the Act shall
receive payment therefor from the Surviving Corporation (but only
pursuant to the Act or as otherwise agreed upon by such holder and the
Surviving Corporation). Dissenting Shares shall be considered
outstanding immediately prior to the Effective Date for purposes of
calculating the Conversion Price.
ARTICLE 3
EFFECTIVE TIME; CLOSING
3.1) Effective Time. The Merger shall become effective when properly
executed and acknowledged Articles of Merger are duly filed with the Arizona
Corporation Commission as
provided in the Act, and the term "Effective Time" shall mean the date on which
the Merger becomes effective in accordance with the Act.
3.2) Closing. The closing (the "Closing") of the transactions
contemplated by this Agreement will take place at the Minneapolis office of
Xxxxxx & Xxxxxxx LLP, on such date as the parties mutually agree but not later
than the last day of the first full month following receipt of all necessary
shareholder approvals and all necessary regulatory approvals, the expiration of
all applicable regulatory waiting periods, and satisfaction of all other
conditions (the "Closing Date").
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF VALLEY AND UFC
As an inducement to Marquette to enter into this Agreement, Valley and
UFC make the following representations and warranties to Marquette, all of which
shall be true and correct as of the date of this Agreement and as of the Closing
Date, subject to the exceptions noted in the Disclosure Schedule attached
hereto. UFC will be deemed to have made the following representations and
warranties to the same extent as the Bank Group, will have the benefit of the
Bank Group's knowledge qualifiers as if such knowledge qualifiers had also
included UFC and will also have the benefit of the additional knowledge
qualifiers of UFC.
4.1) Organization. The Valley consolidated group (the "Bank Group")
consists of Valley, which in turn owns 100% of the outstanding capital stock of
the Bank. Valley is an Arizona corporation and is a registered bank holding
company under the BHC Act; and the Bank is an Arizona banking corporation. Each
member of the Bank Group is duly organized, validly existing and in good
standing under all applicable laws, rules and regulations of its state of
incorporation with all requisite power and authority necessary or required by
law to carry on the business activity in which it is presently engaged in each
jurisdiction in which such activities are conducted. The Bank is an insured bank
as defined in the Federal Deposit Insurance Act. True and complete copies of the
articles of association or incorporation and bylaws of each member or the Bank
Group, as amended to date, have been delivered to Marquette. There have been no
acts or omissions which will, and there are no pending proceedings or actions
to, limit or impair any of the powers, rights and privileges of any member of
the Bank Group or to dissolve any member of the Bank Group. Valley has no direct
or indirect subsidiaries other than the members of the Bank Group. No member of
the Bank Group is a partner in any partnership, member of any limited liability
company or a party to any joint venture.
4.2) Authority for Agreement. Valley and UFC have all requisite power
and authority to execute and deliver this Agreement and to perform their
obligations under this Agreement, subject to approval by Valley's shareholders.
This Agreement has been duly executed and delivered by and constitutes the valid
and legally binding obligation of Valley and UFC, enforceable in accordance with
its terms. The execution, delivery and performance of this Agreement by Valley
and UFC, and the consummation of the transactions contemplated hereby, will not
conflict with or result in any violation of or default under (i) the Articles of
Incorporation or Bylaws of any member of the Bank Group or UFC, or (ii) any
agreement, understanding, instrument or order to which any member of the Bank
Group or UFC is a party or by which any of their property is bound and, in the
case of UFC, is known to UFC. No consent, approval,
order or authorization of, or registration or filing with, any governmental
authority is required in connection with the execution, delivery and performance
by Valley or UFC of this Agreement, except filing of the Articles of Merger and
applications or notices which must be filed with state and federal bank
regulatory agencies.
4.3) Capitalization. Valley has authorized capital stock consisting of
10,000,000 shares of $0.10 par value per share common stock and 1,000,000 shares
of $0.10 par value per share preferred stock, of which 1,722,818 shares of
common stock and no shares of preferred stock are issued and outstanding. All
outstanding shares of common stock are owned of record as of the date of this
Agreement as detailed on Section 4.3 of the Disclosure Schedule. The Bank has
authorized capital consisting of 10,000,000 shares of no par value per share
common stock and 1,000,000 shares of preferred stock, of which 1,000,000 shares
of common stock are issued and outstanding, all of which are owned by Valley and
no shares of preferred stock are issued and outstanding. Except as described on
Section 4.3 of the Disclosure Schedule, all of the UFC Shares and all of the
outstanding shares of capital stock of the Bank are free and clear of any claim,
lien, pledge, security interest, charge, or other encumbrance whatsoever. Except
for the stock options described in Section 4.3 of the Disclosure Schedule
("Stock Options"), there are no other outstanding equity securities of any kind
and no options, warrants, conversion privileges, irrevocable proxies or other
rights, agreements, arrangements or commitments obligating any member of the
Bank Group to issue, sell, purchase or redeem, or restricting the transfer of,
any shares of their capital stock or securities or obligations of any kind
convertible into or exchangeable for any shares of their capital stock or
securities, nor are there any stock appreciation, phantom or similar rights
outstanding based upon the book value or any other attribute of the capital
stock of any member of the Bank Group. All of the outstanding shares of capital
stock of each member of the Bank Group have been duly authorized and validly
issued and are fully paid and non-assessable and have not been issued in
violation of any preemptive rights. The representation in the prior sentence is
made by UFC only to its knowledge. There are no unpaid dividends which have been
declared and/or accumulated with respect to the capital stock of any member of
the Bank Group and there are no restrictions applicable to the payment of
dividends on such capital stock except pursuant to applicable laws and
regulations.
4.4) Litigation. There is no pending or to the knowledge of the Bank
Group threatened litigation or proceeding before any court, arbitrator or
governmental department, board or agency against any member of the Bank Group;
and there currently is no judgment, decree, order, writ, or injunction against
any member of the Bank Group.
4.5) Record Books. The minute books and stock record books of each
member of the Bank Group are complete and correct in all material respects and
reflect all transactions required to be recorded under all applicable laws or
regulations.
4.6) Taxes. Each member of the Bank Group has filed all requisite
federal, state and local tax returns and all other returns with respect to taxes
which are required to be filed on or before the date hereof. All such returns
were accurately prepared, and no member of the Bank Group expects or anticipates
the assessment, or believes there would be a reasonable basis for assessment, of
additional taxes on any member of the Bank Group by any state or federal agency
which would exceed the estimated reserves established on the books and records
of each member of the Bank Group. Complete copies of all state and local tax
returns filed by or on behalf of each member of the Bank Group for the last
three tax years have been made
available to Marquette. All taxes, assessments and other governmental charges
due on or before the date hereof upon each member of the Bank Group, or upon any
of their income, properties or assets, have been duly paid or will be paid
within the statutory filing periods. No member of the Bank Group has received
any notice of deficiency or assessment of additional taxes. No member of the
Bank Group has granted any waiver of any statute of limitation with respect to,
or any extension of a period for the assessment of, any federal, state or other
tax. Each member of the Bank Group has withheld proper and accurate amounts from
its employees and deposited such sums in full and complete compliance with the
tax withholding provisions of applicable federal and state laws, and has
maintained adequate accrual and reserves to cover the liability of each member
of the Bank Group for all their respective federal and state income and other
taxes. The members of the Bank Group have filed consolidated federal income tax
returns, have entered into a consolidated income tax sharing agreement, a
complete copy of which has been provided to Marquette ("Tax Agreement") and have
taken all actions necessary to qualify as a consolidated group for purposes of
the Internal Revenue Code. The Tax Agreement complies with the Federal Reserve
Board's policy statement concerning tax sharing agreements and no tax or benefit
payments have been made or withheld in violation of the aforementioned policy
statement.
4.7) Financial Statements. The Valley unaudited financial statements
(including balance sheet and statements of income) as of December 31, 2002 and
December 31, 2001; Annual Report of Bank Holding Companies (FR Y-6) for the
period ending December 31, 2002 and 2001; Quarterly Report of Bank Holding
Companies (FR Y-LP) for the period ending March 31, 2003; Bank's Consolidated
Reports of Condition and Reports of Income for the period ending December 31,
2002 and March 31, 2003; and Bank's internal board reports for the periods
ending March 31, 2003, true and correct copies of which have been delivered to
Marquette, and any subsequent unaudited balance sheet or income statement,
Annual or Quarterly Report of Bank Holding Companies, Consolidated Report of
Condition and Report of Income, internal board report and any subsequent
periodic report prepared by or on behalf of any member of the Bank Group, copies
of which are delivered in accordance with this Agreement (collectively referred
to as the "Financial Statements"), have been prepared in accordance with GAAP,
except as otherwise required by bank regulatory accounting principles, in a
manner consistently applied, and present fairly the financial condition of
Valley or the Bank, as the case may be, as of the date indicated and the results
of operations and changes in financial position of Valley or the Bank, as the
case may be, for the periods then ended. None of the Financial Statements
contain any items of special or non-recurring income or any other income not
earned in the ordinary course of business, except as expressly specified
therein. No member of the Bank Group has any liabilities or obligations of any
nature, whether absolute, accrued, contingent or otherwise, and whether due or
to become due, which would, individually or in the aggregate, have a material
adverse effect on the business, operations or financial condition of such member
of the Bank Group, and which are not reflected on or reserved against in the
Financial Statements.
4.8) Title to Properties and Assets. Each member of the Bank
Group has the requisite power and authority to own or operate and has good and
marketable title to all of the real and personal property, tangible or
intangible, recorded on their respective books and records, free and clear of
all mortgages, pledges, leases, charges, liens, encumbrances, defects or rights
of third parties with the exception of (i) liens for taxes, assessments or other
governmental charges not yet delinquent, (ii) such imperfections in title and
minor easements, defects, exceptions and encumbrances which in the aggregate,
would not have a material adverse effect on the Bank Group, (iii) securities
repurchase agreements entered into in the ordinary course of business, and
(iv) pledges of securities by the Bank to secure public deposits. The
representation in the prior sentence is made by UFC only to its knowledge. To
the knowledge of the Bank Group, all such property is in good and usable
condition, ordinary wear and tear excepted, and is maintained in accordance with
and complies with all applicable laws, ordinances, codes, rules and regulations.
All property and assets held by members of the Bank Group under licenses or
leases are held under valid and enforceable licenses and leases, and no member
of the Bank Group is in default in any respect under or a party to a dispute
under any such licenses or lease, each of which will continue in full force and
effect immediately after the Effective Date. Valley agrees to deliver to
Marquette, within 30 days from the date hereof, a title commitment for the real
properties at which Valley conducts its business (including any fixtures located
on such real estate) (the "Title Commitment").
4.9) Environmental Compliance. To the knowledge of the Bank Group,
Properties owned, leased or otherwise used by the Bank Group in conducting its
day to day business operations, and the Participation Facilities (as hereinafter
defined), are and have been in compliance with all applicable federal, state and
local laws including common law, rules, regulations, ordinances, decrees,
orders, and judgments relating to the environment, health, safety, natural
resources or the storage, disposal or release of Hazardous Materials (defined
below) ("Environmental Laws"), except for any such non-compliance or violations
which, either individually or in the aggregate, would not have a material
adverse effect on the Bank Group. To the knowledge of the Bank Group, during the
period of (a) the Bank Group's ownership or operation of any of its respective
current properties, or (b) the Bank Group's direct participation in the
management of any Participation Facility, Hazardous Materials have not been
generated, treated, stored, transported, released or disposed of in, on, under,
above, from or affecting any such property, except where such release,
generation, treatment, storage, transportation, or disposal would not have,
either individually or in the aggregate, a material adverse effect on the Bank
Group. To the knowledge of the Bank Group, there is (i) no friable asbestos or
urea formaldehyde materials in or on any property owned or operated by the Bank
Group or any Participation Facility, (ii) no electrical transformers or
capacitors, other than those owned by public utility companies, on any such
properties contain any PCB's, and (iii) no underground storage tanks located on,
in or under any such property owned or operated by the Bank Group or any
Participation Facility. The Bank Group has never received any written notice
from any governmental agency or third party notifying The Bank Group of any
Environmental Claim. To the knowledge of the Bank Group, there are no
circumstances with respect to any properties currently owned or operated by the
Bank Group or any Participation Facility that reasonably could be anticipated
(a) to form the basis for an Environmental Claim against the Bank Group or (b)
to cause any properties currently owned or operated by the Bank Group or any
Participation Facility to be subject to any restrictions on ownership,
occupancy, use or transferability under any applicable Environmental Law.
The following definitions apply for purposes of this Section: (a)
"Participation Facility" means any facility in which the Bank Group directly
participates in the management of such property; (b) "Environmental Claims"
shall mean any and all administrative, regulatory, judicial or private actions,
suits, demands, demand letters, notices, claims, liens, notices of
non-compliance or violation, investigations, allegations, injunctions or
proceedings under any Environmental Law; and (c) Hazardous Material shall mean
any chemicals, pollutants, contaminants, wastes, toxic substances, or other
materials the storage, disposal or release of which is regulated under any
Environmental Law.
This Section 4.9 shall be the only representation by the Bank Group and
UFC with respect to Environmental Laws and Environmental Claims.
4.10) Notes and Other Evidences of Indebtedness. All loans, leases and
loan commitments extended by the Bank (the "Loans") have been made and
maintained in the ordinary course of business, in accordance with the Bank's
customary lending standards and policies, and in compliance with all applicable
laws and regulations. The Bank's loan files contain all notes, leases and other
evidences of any indebtedness or lease arrangements, including without
limitation all loan agreements, loan participation agreements and certificates,
security agreements, mortgages, guarantees, amendments, UCC financing statements
and similar documents evidencing collateral or other financial accommodations
relating to the Loans ("Loan Documents"). The representation in the prior
sentence is made by UFC only to its knowledge. All Loan Documents are correct in
amount, genuine as to signatures of every party thereto, including, but not
limited to lessees, makers and endorsers, and were given for valid consideration
and are enforceable in accordance with their respective terms, subject to
bankruptcy and other debtor relief laws of general application. None of the
obligations represented by the Loan Documents have been modified, altered,
forgiven, discharged or otherwise disposed of except as indicated by the Loan
Documents or as a result of bankruptcy or other debtor's relief laws of general
application. None of the Loans is subject to any offsets or valid and
enforceable claims of offset or other liability on the part of the Bank.
4.11) Employee Plans.
(a) Section 4.11 of the Disclosure Schedule sets forth each
employee benefit plan with respect to which the Bank Group
contributes, sponsors or otherwise has any obligation or are
maintained or have, during the last full five years, been
maintained by the Bank Group or any party related to the Bank
Group (identifying separately those plans related to the Trust
Business) (the "Plans"). For purposes of this Section and
Section 4.11 of the Disclosure Schedule, "ERISA" means the
Employee Retirement Income Security Act of 1974, as amended, and
the term "Plan" or "Plans" means all employee benefit plans as
defined in Section 3(3) of ERISA and all other benefit
arrangements including, without limitation, any plan, program,
agreement, policy or commitment providing for insurance coverage
of employees, workers' compensation, disability benefits,
supplemental unemployment benefits, vacation benefits,
retirement benefits, severance or termination of employment
benefits, life, health, death, disability or accidental
benefits.
(b) No Plan is a "multiemployer plan" within the meaning of
Section 3(37) of ERISA and the Bank Group has never sponsored a
Plan that was subject to Title IV of ERISA or Section 412 of the
Code.
(c) Except as disclosed in Section 4.11 of the Disclosure
Schedule, no Plan promises or provides health or life benefits
to retirees or former employees except as required by federal
continuation of coverage laws or similar state laws.
(d) Except as disclosed in Section 4.11 of the Disclosure
Schedule, (i) each Plan (any related trust agreements or annuity
contracts or any other funding instruments) is and has been in
all material respects operated and administered in
accordance with its provisions and applicable law including, if
applicable, ERISA and the Internal Revenue Code of 1986, as
amended (the "Code"); (ii) all reports and filings with
governmental agencies (including but not limited to the
Department of Labor, Internal Revenue Service, Pension Benefit
Guaranty Corporation) required in connection with each Plan have
been timely made; (iii) all disclosures and notices required by
law or Plan provisions to be given to participants and
beneficiaries in connection with each Plan have been properly
and timely made; (iv) there are no actions, suits or claims
pending, other than routine uncontested claims for benefits with
respect to each Plan; and (v) each Plan intended to be qualified
under Section 401(a) of the Code has received a favorable
determination letter from the Internal Revenue Service stating
that the Plan (including all amendments) is tax qualified under
Section 401(a) of the Code and The Bank Group knows of no reason
that any such Plan is not qualified within the meaning of
Section 401(a) of the Code and knows of no reason that each
related Plan trust is not exempt from taxation under Section
501(a) of the Code.
(e) Except as disclosed in Section 4.11 of the Disclosure
Schedule, (i) all contributions, premium payments and other
payments required to be made in connection with the Plans as of
the date of this Agreement have been made; (ii) a proper accrual
has been made on the books of the Bank Group for all
contributions, premium payments and other payments due in the
current fiscal year but not made as of the date of this
Agreement; and (iii) no contribution, premium payment or other
payment has been made in support of any Plan that is in excess
of the allowable deduction for federal income tax purposes for
the year with respect to which the contribution was made
(whether under Section 280G, 404, 419, 491A of the Code or
otherwise).
(f) Except as disclosed in Section 4.11 of the Disclosure
Schedule and to the Bank Group's knowledge, no Plan or any trust
created thereunder, nor any trustee, fiduciary or administrator
thereof, has engaged in a "prohibited transaction," as such term
is defined in Section 4975 of the Code or Section 406 of ERISA
or violated any of the fiduciary standards under Part 4 of Title
1 of ERISA which could subject such Plan or trust, or any
trustee, fiduciary or administrator thereof, or any party
dealing with any such Plan or trust, to a tax penalty or
prohibited transactions imposed by Section 4975 of the Code or
would result in material liability to the Bank Group.
(g) Except as disclosed in Section 4.11 of the Disclosure
Schedule, neither the execution and delivery of this Agreement
nor the consummation of the transactions contemplated hereby and
thereby will (i) result in any material payment (including,
without limitation, severance, unemployment compensation, golden
parachute or otherwise) becoming due to any director or employee
or former employee of the Bank Group under any Plan or
otherwise, (ii) materially increase any benefits otherwise
payable under any Plan, or (iii) result in the acceleration of
the time of payment or vesting of any such benefits to any
material extent.
(h) Except as disclosed in Section 4.11 of the Disclosure
Schedule, The Bank Group has not made any payments or transfers
of property, is not obligated to make any payments or transfers
of property, nor is it a party to any agreement that under
certain circumstances could obligate it to make any payments or
transfers of property that will not be deductible under Section
280G of the Code.
4.12) Insurance Policies. The Bank Group has continually maintained
insurance policies and bonds insuring each member of the Bank Group against
losses relating to all real and personal property owned by members of the Bank
Group, personal injury claims and any acts of dishonesty by its employees,
officers and directors (the "Insurance"). All of the Insurance is for such
amounts as are reasonable and customary for institutions of a similar size and
is currently in full force and effect. No application filed for such insurance
policies and bonds contains any misstatement of fact or fails to state any fact
which may adversely affect the insurance coverage provided. Each member of the
Bank Group has properly notified all insurance carriers of any and all known
claims for which any member of the Bank Group is insured and has complied with
all other material requirements and conditions of such Insurance. No member of
the Bank Group has received notice of cancellation of any of the Insurance. No
claim has been maintained under any fidelity bond maintained by the Bank Group
and no member of the Bank Group is aware of any facts that would form the basis
for a claim under any such bond.
4.13) Compliance with Laws. Each member of the Bank Group has complied
in all material respects with all applicable laws, rules and regulations of
foreign, federal, state and local governments and all agencies thereof the
noncompliance with which would materially adversely affect the business or any
owned or leased properties of the members of the Bank Group or to which the
members of the Bank Group may be subject and has correctly and accurately filed,
in all material respects, all reports, returns, information and data as required
by such laws and regulations. There are no currently pending claims by any such
governments or agencies against any member of the Bank Group alleging a
violation of any such law or regulation and no member of the Bank Group is
currently subject to, or has taken any action which will subject it to, any
regulatory order or agreement or other regulatory action or has received a less
than satisfactory rating in an regulatory examination report issued in the last
three years.
4.14) Contracts and Other Agreements. Except as disclosed in Section
4.14 of the Disclosure Schedule or otherwise disclosed herein, no member of the
Bank Group is party to or bound by any written or oral (i) contract with any
labor union, (ii) employment, agency, consulting or similar contract, (iii)
"true" lease, whether as lessor or lessee, with respect to any real or personal
property, (iv) material contract or commitment extending beyond six months from
the date of this Agreement that cannot be canceled by it without cost or penalty
upon one month or less notice, (v) contract or commitment involving more than
$25,000 a year in the aggregate, other than the purchase of merchandise and
supplies in the ordinary course of business, (vi) guaranty, suretyship,
indemnification or contribution agreement, other than obligations of members of
the Bank Group to indemnify its officers and directors in accordance with its
Articles or Certificate of Incorporation and Bylaws, (vii) other contract not
made in the ordinary course of business, or (viii) contracts for the sale of
credit life or disability insurance policies. No member of the Bank Group is
party to or bound by any written or oral long-term debt agreement, credit
agreement, sale-leaseback agreement, revolving credit agreement, financing
agreement or mortgage on real property, in which any member of the Bank Group is
named debtor or mortgagor, other than deposit (or similar) obligations of the
Bank. No member
of the Bank Group is in default, and no event has occurred which, with the
passage of time or the giving of notice, or both, would constitute a default
under any agreement, indenture, loan agreement or other instrument to which it
is a party or by which it or any of its assets is bound or to which any of its
assets is subject. To the knowledge of the Bank Group, all parties with whom any
member of the Bank Group has material leases, agreements or contracts or who owe
obligations to any member of the Bank Group (other than under the Loan
Documents) are in compliance therewith in all material respects.
4.15) Affiliate and Insider Transactions. Except as disclosed in
Section 4.15 of the Disclosure Schedule, no officer or director of any member of
the Bank Group, trustee of any trust holding stock of any member of the Bank
Group, or owner of 10% or more of the outstanding common stock of Valley, no
member of the immediate family of any such officer, director or shareholder, and
no entity controlled by one or more such persons (collectively the "Insiders"),
has any loan or any other agreement or arrangement with any member of the Bank
Group (other than normal employment arrangements complying with all applicable
laws and regulations) or any interest in any property used or pertaining to the
business of any member of the Bank Group. For purposes of this paragraph, the
members of the immediate family of any individual will consist of the
individual's spouse, parents, children, siblings, mothers- and fathers-in-law,
sons- and daughters-in-law, and brothers- and sisters-in-law.
4.16) Fiduciary Duties. To the knowledge of the Bank Group, Bank has
properly administered all accounts for which it acts as a fiduciary, including
but not limited to accounts for which it serves as trustee, agent, custodian,
personal representative, guardian, escrow agent or investment advisor, in
accordance with the terms of the documents governing such relationships,
applicable state and federal laws, rules and regulations and common law. The
accountings for each such fiduciary account are true and correct statements and
accurately reflect the assets of such fiduciary account.
4.17) No Brokers or Finder's Fees. There are no claims for broker's
commissions, finder's fees, investment advisory fees or similar compensation in
connection with the transactions contemplated by this Agreement based on any
arrangement or agreement made by or on behalf of any member of the Bank Group or
its shareholders, except such fees and commissions payable by Valley to X.X.
Xxxxxxxx & Co. ("Davidson Fee").
4.18) Material Adverse Change. There has been no material adverse
change in the business, properties, assets or condition, financial or otherwise,
of the Bank Group taken as a whole since March 31, 2003 and to the knowledge of
the Bank Group no event, act or omission has occurred which will result in a
material adverse change in the future, provided that such material adverse
change shall not include changes resulting from changes in laws, rules,
regulations, Generally Accepted Accounting Principles, general and local
economic conditions, prevailing interest or deposit rates, or any other matter
affecting financial institutions and their holding companies generally and which
do not have a disproportionate impact on a member of the Bank Group.
4.19) Supervisory Limitations. No member of the Bank Group is party to
any assistance agreement, supervisory agreement, memorandum of understanding,
consent order, cease and desist order or condition of any regulatory order or
decree with or by the Board of Governors
of the Federal Reserve System, the OCC, the FDIC or any other regulatory
authority, in either case whether written or oral.
ARTICLE 5
REPRESENTATIONS AND WARRANTIES OF MARQUETTE
As an inducement to Valley and UFC to enter into this Agreement,
Marquette makes the following representations and warranties to Valley and UFC,
all of which shall be true and correct as of the date of this Agreement and as
of the Closing Date.
5.1) Organization. Marquette is a Minnesota corporation and is a
registered bank holding company under the BHC Act. Marquette is duly organized,
validly existing and in good standing under the laws of the State of Minnesota
with all requisite power and authority necessary or required by law to carry on
the business activity in which it is presently engaged in each jurisdiction in
which such activities are conducted. There have been no acts or omissions which
will, and there are no pending proceedings or actions to, limit or impair any of
Marquette's powers, rights and privileges or to dissolve Marquette.
5.2) Authority for Agreement. Marquette has all requisite power and
authority to execute and deliver this Agreement and to perform its obligations
under this Agreement, subject to approval by its shareholders. This Agreement
has been duly executed and delivered by and constitutes the valid and legally
binding obligation of Marquette, enforceable in accordance with its terms. The
execution, delivery and performance of this Agreement by Marquette and the
Articles of Merger by Newco, and the consummation of the transactions
contemplated thereby, will not conflict with or result in any violation of or
default under (i) their Articles of Incorporation or Bylaws, or (ii) any trust,
guardianship, custody or other agreement, or any understanding, instrument or
order to which Marquette or Newco is a party or by which their property is
bound. No consent, approval, order or authorization of, or registration,
declaration or filing with, any governmental authority is required in connection
with the execution, delivery and performance by Marquette of this Agreement or
by Newco of the Articles of Merger, except filing of Articles of Merger and
applications or notices which must be filed with state and federal bank
regulatory agencies.
5.3) No Brokers or Finder's Fees. There are no claims for broker's
commissions, finder's fees, investment advisory fees or similar compensation in
connection with the transactions contemplated by this Agreement based on any
arrangement or agreement made by or on behalf of Marquette except such fees and
commissions payable solely by Marquette.
ARTICLE 6
COMPLETENESS OF DISCLOSURES
No representation or warranty of any party in this Agreement or the
Disclosure Schedule, contains or, will contain on the Closing Date, any untrue
statement of material fact or omits or will omit to state a material fact
necessary in order to make the statements contained herein or therein not
misleading. The Disclosure Schedule completely and correctly present the
information required by this Agreement to be set forth therein.
ARTICLE 7
OPERATIONS PENDING CLOSING
7.1) Operating Covenants. Valley hereby covenants and agrees that, from
the date of this Agreement through the Closing Date or the earlier termination
of this Agreement, Valley, except with the prior written consent of Marquette,
any request for which Marquette shall promptly review and respond to, shall not
and shall not cause or allow the Bank to:
(a) Declare or pay any dividends or distributions with respect to any
shares of their capital stock;
(b) Borrow any amount or incur or become subject to any material
liability, except liabilities incurred in the ordinary course of
business, but in no event shall enter into any long-term borrowings or
obligations, other than deposit obligations;
(c) Discharge or satisfy any material lien or encumbrance on the
properties or assets of any member of the Bank Group or pay any
material liability, other than in the ordinary course of business,
unless the member of the Bank Group is under a legal obligation to make
any such payment;
(d) Sell, assign or transfer any tangible assets, except for the sale
of collateral and other assets in the ordinary course of business;
(e) Amend their Articles of Association or Incorporation or Bylaws;
(f) Cancel any material debt or claim or waive any right of material
value, except renewals of loans and debt restructurings and other
transactions in the ordinary course of the Bank's business and
consistent with safe and sound banking practices;
(g) Repurchase or enter into any agreement to repurchase all or any
portion of any loan previously participated to any other financial
institution where the loan is in default or has been classified;
(h) Originate any loan which is thereafter participated to another
financial institution providing for payment upon default on any basis
other than pro rata;
(i) Make or commit to make any further advances on any loan which is
either in default or classified, whether such classification is a
result of a federal bank regulatory examination or internal
classification by Bank's officers or directors, unless the Bank is
under a legal obligation to do so;
(j) Release or agree to release any collateral securing any loan,
except where the collateral released is replaced by collateral with an
equal or greater value, where the collateral is immaterial in value or
where the Bank is under a legal obligation to release the collateral;
(k) Make, renew or agree to make, or renew any loan or advance on any
existing loan, to any one borrower if the aggregate outstanding loans
and commitments to that borrower will exceed $200,000 in the aggregate,
unless the Bank is under a legal obligation to do so; or make, renew or
agree to make or renew any loan or advance on any existing loan, except
in conformity with the Bank's current loan policies and safe and sound
banking practices;
(l) Pay or incur any obligation or liability with respect to capital
expenditures which exceed $25,000 in the aggregate;
(m) Fail to timely pay and discharge all federal and state taxes and
other accounts payable for which it is liable;
(n) Pay or commit to pay any increase in salary or other compensation
to any officer, director or employee, other than those certain Stay
Bonus Agreements by and between the Bank and each of Xxxxxxx Xxx,
Xxxxxx Xxxxxxxx, Xxxxx Xxxx and Xxxxxxx Xxxx;
(o) Make or grant any increase in any Employee Plan or arrangement,
amend or terminate any existing Employee Plan or arrangement, or adopt
any new Employee Plan or arrangement, except as required by law or by
this Agreement;
(p) Purchase or agree to purchase any investment securities, other than
U.S. Treasury securities with a maturity not to exceed five years, or
sell or agree to sell any investment securities prior to maturity;
(q) Incur or permit to be entered against a member of the Bank Group
any default judgment, or permit any unsatisfied judgment to remain
unsatisfied unless that judgment is being appealed;
(r) Fail to conduct its business in, and only in, the usual, regular
and ordinary course in substantially the same manner as heretofore
conducted and in accordance with the terms and conditions of this
Agreement; or
(s) Sell any stock, except stock of Valley pursuant to the lawful
exercise of the Stock Options pursuant to their terms.
7.2) Operating Representations. Valley represents and warrants to
Marquette that, except as disclosed on Section 7.2 of the Disclosure Schedule,
for the period from March 31, 2003 through the date of this Agreement, no member
of the Bank Group has acted or failed to act in a manner which would constitute
a violation of Section 7.1 if such action or inaction occurred after the date of
this Agreement.
ARTICLE 8
ADDITIONAL COVENANTS
8.1) Notification of Certain Matters. Valley and UFC shall give prompt
notice to Marquette of (a) the occurrence or nonoccurrence of any event, act or
omission or the discovery of any information which would be likely to cause any
representation or warranty and contained in this Agreement, any of the Financial
Statements or the Disclosure Schedule to be materially
untrue or inaccurate when made or at any time on or before the Closing Date and
(b) any failure to comply with or satisfy any covenant, condition or agreement
hereunder. No such notice by Valley or UFC shall be deemed a permissible
exception to a representation or warranty or a waiver of any breach of any other
provision of this Agreement unless the event or information described in such
notice would not constitute a material breach of such representation or warranty
or any other provision of this Agreement.
8.2) Delivery of Financial Statements. Valley shall and shall cause the
Bank to deliver copies of monthly internal board reports, each Consolidated
Report of Condition and Report of Income, and each Annual or Quarterly Report of
Bank Holding Companies (FR Y-6 or FR Y-9LP) to Marquette within ten (10) days
after such reports have been prepared.
8.3) Shareholder Approvals. Valley and Marquette shall take all actions
necessary to submit this Agreement and the Plan of Merger for approval of and
recommend approval by their respective shareholders no later than thirty (30)
days prior to the receipt of all necessary regulatory approvals and the
expiration of all applicable regulatory waiting periods. Prior to any meeting of
the shareholders of Valley at which the transactions contemplated by this
Agreement are presented for approval, Valley shall deliver to its shareholders a
shareholder information or proxy statement ("Shareholder Statement") describing
the proposed transactions and all other material facts and information regarding
the transactions contemplated by this Agreement, the business and financial
condition of the Bank Group, describing the rights of its shareholders in
relation to the proposed transactions, and recommending approval of the proposed
transactions, except where the Board of Directors of Valley determines in good
faith (upon the advice of outside legal counsel) that making no recommendation
or recommending against approval of the proposed transactions is required for
such Board of Directors to comply with its fiduciary duties to stockholders
under applicable law. The Shareholder Statement shall be delivered to Valley's
shareholders no later than the date on which notice of such shareholder meeting
is provided to the shareholders. Prior to delivery to the shareholders, Valley
shall provide Marquette the opportunity to review and comment on a draft of the
proposed Shareholder Statement.
8.4) Voting of UFC Shares. UFC agrees to vote all of the UFC Shares in
favor of the transactions contemplated by this Agreement and the Plan of Merger,
at any meeting of Valley's shareholders and any adjournments thereof, except
where the Board of Directors of UFC determines in good faith (upon the advice of
outside legal counsel) that not voting the UFC Shares in favor of the
transactions contemplated by this Agreement is required for such Board of
Directors to comply with its fiduciary duties to stockholders under applicable
law and subject to the payment of the Break Up Fee as further provided in
Section 13.17.
8.5) Voting of Newco Shares. Marquette agrees to vote all of the
outstanding shares of capital stock of Newco in favor of the transactions
contemplated by this Agreement and the Plan of Merger, by written action or at
any meeting of Newco's shareholders and any adjournments thereof.
8.6) Shareholder Transmittal Letter. Attached as Exhibit 8.6 is the
form of transmittal letter to be used by shareholders of Valley to exchange
their stock certificates for the Cash Payment provided for under this Agreement
and which shall be delivered by Marquette to Valley's shareholders prior to the
Closing Date, so that such shareholders shall have the
opportunity to return the transmittal letter, along with their stock
certificates, and be paid the Cash Payment immediately after the Closing.
8.7) Disposition of Employee Plans. The parties acknowledge and agree
that Valley or, the Surviving Corporation, as the case may be, shall terminate
the Valley Bank of Arizona 401(k) Profit Sharing Plan (the "Plan") and
distribute assets to eligible employees as soon as possible following the
Merger, subject to the receipt of a favorable determination letter from the
Internal Revenue Service regarding the effect of termination on the continued
qualification of the Plan. As soon as possible following the execution of this
Agreement and prior to the Merger, Valley shall take all actions necessary or
appropriate, including the adoption of all necessary board resolutions, to
permit the submission and shall submit the Plan to the Internal Revenue Service
for a favorable determination letter.
8.8) Regulatory Approval. No later than 15 days after the date of this
Agreement, Marquette shall submit draft applications to all necessary state and
federal bank regulatory authorities for prior approval of the Merger as required
by applicable law or regulation, use its best efforts to file final applications
within 30 days after the date of this Agreement and use its best efforts to
obtain all necessary regulatory approvals.
8.9) Mortgage Processing. UFC shall, and shall cause its subsidiaries
and affiliates to, continue to underwrite and process consumer mortgage
applications of customers of the Bank, consistent with past practice (including
the normal fees charged by UFC which Marquette agrees to cause the Bank or its
successor to pay) and in the same manner as applications of customers of UFC and
its affiliates, until all applications submitted on or before the Closing Date
are approved and closed or denied, consistent with applicable underwriting
standards.
8.10) Participation in Employee Benefit Plans. The parties acknowledge
and agree that employees of Bank shall, to the extent permitted by applicable
laws and regulations, receive credit for service with Bank for eligibility,
vesting and accrual under all employee benefit plans including but not limited
to 401(k), Section 125 cafeteria plan, group medical, dental, disability, life,
vacation and sickpay plans sponsored or maintained for similarly situated
employees of Marquette, provided however, that such credit for service shall not
apply for accrual purposes under any defined benefit pension plan. Marquette and
Newco shall waive all eligibility waiting periods for participation in such
plans.
ARTICLE 9
ACCESS TO INFORMATION AND PRE-CLOSING EXAMINATION
9.1) Access to Information and Pre-Closing Examination. Valley shall
permit and shall cause the Bank to permit reasonable access to the Bank Group's
properties, directors, officers, employees and outside consultants, including
prior notice and the option to observe all Bank board of director, loan
committee and asset-liability committee meetings, and shall disclose and make
available (together with the right to copy) all books, papers and records
relating to the assets, stock, properties, operations, obligations and
liabilities of the member of the Bank Group in which Marquette may reasonably
request. Absent a writing to the contrary executed by an authorized
representative of Marquette, Marquette's investigation or lack thereof shall not
result in a waiver of any of its rights under this Agreement.
9.2) Confidentiality. All information furnished pursuant hereto or as
otherwise provided will be treated as the sole property of the party furnishing
the information until the Closing Date, and, if the Closing does not occur, each
party shall return or destroy all documents or other materials containing such
information, shall use its best efforts to keep confidential all such
information, and shall not directly or indirectly use such information for any
competitive or other commercial purpose. The obligation to keep such information
confidential will not apply to any information which such party can establish
(a) was already legally in its possession prior to the disclosure thereof to
such party by the party furnishing the information; (b) was then generally known
to the public or became known to the public through no fault of such party or
its representatives, (c) was disclosed to such party by a third party not bound
by an obligation of confidentiality, or (d) was disclosed in accordance with an
order of any bank regulatory agency or a court of competent jurisdiction.
ARTICLE 10
CONDITIONS PRECEDENT TO THE OBLIGATIONS OF VALLEY
All of the agreements and obligations of Valley under this Agreement
are subject to the fulfillment, on or prior to the Closing Date, of the
following conditions precedent, any or all of which may be waived in whole or in
part in writing by Valley:
10.1) Representations Warranties and Agreements. The representations
and warranties of Marquette set forth in this Agreement shall have been true and
correct in all material respects as of the date hereof and as of the Closing
Date as if made at and as of each of such dates. Marquette shall have performed
and complied with all of the agreements, covenants and conditions required by
this Agreement to be performed or complied with by it on or prior to the Closing
Date.
10.2) Regulatory Approval. All appropriate state and federal bank
regulatory agencies shall have approved, and all statutory requirements shall
have been satisfied in connection with, the consummation of the Merger and such
approvals shall not have been withdrawn prior to the Effective Time.
10.3) Shareholder Approval. This Agreement and the Plan of Merger shall
have been approved by the affirmative vote of a majority of the outstanding
shares of Newco and Valley.
10.4) No Court Order. No court or governmental authority of competent
jurisdiction shall have issued a permanent order restraining, enjoining or
otherwise prohibiting the consummation of the transactions contemplated by this
Agreement.
ARTICLE 11
CONDITIONS PRECEDENT TO THE OBLIGATIONS OF MARQUETTE
All of the agreements and obligations of Marquette under this Agreement
are subject to the fulfillment, on or prior to the Closing Date, of the
following conditions precedent, any or all of which may be waived in whole or in
part in writing by Marquette:
11.1) Representations Warranties and Agreements. The representations and
warranties of Valley set forth in this Agreement shall have been true and
correct in all material respects as of
the date hereof and as of the Closing Date as if made at and as of each of such
dates. Valley shall have performed and complied with all of the agreements,
covenants and conditions required by this Agreement to be performed or complied
with by it on or prior to the Closing Date.
11.2) Material Adverse Change. There shall have been no material adverse
change in the business or financial condition of the Bank Group taken as a whole
since March 31, 2003, provided that such material adverse change shall not
include changes resulting from changes in laws, rules, regulations, Generally
Accepted Accounting Principles, general and local economic conditions,
prevailing interest or deposit rates, or any other matter affecting financial
institutions and their holding companies generally and which do not have a
disproportionate impact on a member of the Bank Group.
11.3) Regulatory Approval. All appropriate state and federal bank
regulatory agencies shall have approved, and all statutory requirements shall
have been satisfied in connection with the consummation of the Merger and such
approvals shall not have been withdrawn prior to the Effective Time. Such
approvals will be consistent with the applications described in Section 8.8 and
no approvals, licenses or consents granted by any regulatory authority will
contain any requirement, covenant or condition which in the reasonable judgment
of Marquette is unduly burdensome and which Marquette could not be required to
comply with but for this Agreement.
11.4) Shareholder Approval. This Agreement and the Plan of Merger shall
have been approved by the affirmative vote of a majority of the outstanding
shares of Valley.
11.5) Opinion of Counsel. Marquette has received a favorable opinion of
counsel for Valley as of the Closing Date in form and substance satisfactory to
Marquette, to the effect that:
(a) Each member of the Bank Group is duly organized, validly existing
and in good standing under the laws of its state of incorporation with
all requisite power and authority necessary or required by law to carry
on the business activity in which it is presently engaged;
(b) The execution, delivery and performance of this Agreement by
Valley, and the consummation of the transactions contemplated hereby,
have been duly authorized by all necessary corporate action, and will
not conflict with or result in any violation of or default under the
Articles of Incorporation or Bylaws of any member of the Bank Group;
and
(c) As to Valley, the Agreement is valid, binding and enforceable in
accordance with its terms.
11.6) Good Standing. Valley shall have obtained and delivered to
Marquette a certificate of good standing for itself and for the Bank to evidence
corporate existence.
11.7) No Court Order. No court or governmental authority of competent
jurisdiction shall have issued a permanent order restraining, enjoining or
otherwise prohibiting the consummation of the transactions contemplated by this
Agreement.
11.8) Options. All of the Stock Options shall have been exercised in
accordance with their terms prior to or as of the Closing Date, as further
provided in the Stock Option Exercise Agreement in the form attached as Exhibit
11.8, or cancelled without payment of any consideration by the Bank Group.
ARTICLE 12
DELIVERY OF DOCUMENTS
On the Closing Date, the parties shall execute and/or deliver to the
appropriate parties the following documents, instruments and agreements,
together with such other documents, instruments and agreements as the other
party (or its/their counsel) may reasonably request to consummate the Merger
contemplated hereby:
12.1) By Valley:
(a) Articles of Merger duly executed by Valley in the form attached as
Exhibit A.
(b) A Officer's Certificate signed by the president of Valley and UFC
and certifying compliance with the terms and conditions of this
Agreement, accuracy of the representations and warranties and approval
of directors and shareholders.
(c) The minute book and other corporate records of each member of the
Bank Group as may be requested by Marquette.
(d) The legal opinion and good standing certificate required by Article
11.
12.2) By Marquette:
(a) Articles of Merger duly executed by Newco in the form attached as
Exhibit A.
(b) An Officer's Certificate signed by the president of Marquette and
certifying compliance with the terms and conditions of this Agreement,
accuracy of the representations and warranties and approval by the board
of directors and shareholders of Newco.
ARTICLE 13
MISCELLANEOUS
13.1) Termination. This Agreement may be terminated and the transactions
contemplated hereby abandoned at any time prior to the Closing Date:
(a) By mutual written consent of the parties.
(b) By Marquette in the event of any material breach of any of the
representations, warranties or covenants of Valley contained in this
Agreement.
(c) By Valley or UFC in the event of any material breach of any of the
representations, warranties or covenants of Marquette contained in this
Agreement or upon payment of the Break Up Fee in accordance with Section
13.17.
(d) By any party if the Closing has not occurred by September 30, 2003,
which date may be extended by the mutual written agreement of the
parties.
If this Agreement is terminated, as provided in this Section, this Agreement
will become void and there will be no liability or further obligation hereunder
on the part of any party, their respective shareholders, officers, directors,
trustees, guardians or custodians, except where such termination results from a
willful and material breach of this Agreement. Notwithstanding the foregoing,
Section 9.2 shall survive the termination of this Agreement.
13.2) Survival of Representations and Warranties. The representations
and warranties of the parties hereto shall not survive the consummation of the
Merger.
13.3) Confidentiality of Transaction. Except where a party may be
advised by counsel that disclosure is required under applicable law, no party
shall make, and each party shall advise their agents, directors, officers,
representatives and employees not to make, any public statement concerning the
transactions contemplated by this Agreement without first consulting with, and
obtaining the approval of, the other parties hereto. The parties agree that one
or more press releases will be made promptly after the execution of this
Agreement and the Closing.
13.4) Amendment. No amendment, modification, termination or waiver of
any provision of this Agreement will be effective unless in writing and signed
by all parties.
13.5) Successors in Interest. This Agreement will be binding upon and
inure to the benefit of the parties and their respective successors and assigns.
13.6) Partial Invalidity. Any provision of this Agreement which is
prohibited or unenforceable will be ineffective only to the extent of such
prohibition or unenforceability without invalidating the remaining provisions
hereof. If, however, the prohibition or unenforceability of any provision or
provisions of this Agreement will either individually or in the aggregate, have
a material adverse effect on the transaction contemplated by this Agreement and
such provisions are held to be prohibited or unenforceable prior to the Closing
Date, then the entire Agreement shall be deemed null and void.
13.7) Entire Agreement. Except as otherwise specified herein, this
Agreement contains the entire agreement between the parties hereto with respect
to the Merger contemplated hereby and supersedes all prior agreements and
understandings among the parties, if any, with respect to such Merger.
13.8) Headings. The headings of this Agreement are for purpose of
reference only and shall not limit or otherwise affect the meaning hereof.
13.9) Governing Law. This Agreement will be governed by and construed
in accordance with the laws of the State of Minnesota.
13.10) Expenses. Except as may otherwise expressly be agreed to in
writing by the parties, each party shall pay its respective expenses incurred in
connection with the negotiation and preparation of this Agreement and the
consummation of the transactions contemplated hereby, including, without
limitation, their respective legal fees, expenses and filing fees regardless of
whether such transactions are consummated.
13.11) Waivers. No failure or delay on the part of any party in
exercising any right, power or remedy hereunder will operate as a waiver
thereof, nor will any single or partial exercise of any right, power or remedy
preclude any other or further exercise thereof or the exercise of any other
right, power or remedy hereunder.
13.12) Assignability. A party may not assign any of such party's
rights, liabilities or obligations under this Agreement without the prior
written consent of the other parties hereto.
13.13) Notices. All notices, requests, demands and other communications
hereunder shall be in writing and shall be deemed to have been duly given when
personally delivered or three days after deposit in the United States Mail,
mailed first class, certified and return receipt requested, addressed as
follows:
If to Valley: With a copy to:
------------- ---------------
Xxxxxxx Xxx Xxxx X. Xxxxxxx
Valley Bancorp, Inc. Xxxxxx & Xxxxxxx LLP
0000 Xxxxx Xxxxxxx Xxxxxx 0 Xxxxx Xxxxxx X., Xxxxx 000
Xxxxx 000 Great Falls MT 59401
Xxxxxxx XX 00000 Fax No. (000) 000-0000
Fax No. (000) 000-0000
If to UFC:
Xxxx Xxxxx
United Financial Corp
c/o Central Financial Services, Inc.
0000 Xxxxxxx Xxxxxxxxx, Xxxxx 000
Xxxxxx Xxxxxx XX 00000
Fax No. (000) 000-0000
If to Marquette: With a copy to:
--------------- --------------
Xxxx Xxxxxxx Xxxxxx Xxx X. Xxx
-----------------------------
Marquette Financial Companies Marquette Financial Companies
3800 Xxxx Xxxxxxxx Plaza 3800 Xxxx Xxxxxxxx Plaza
00 Xxxxx Xxxxx Xxxxxx 00 Xxxxx Xxxxx Xxxxxx
Xxxxxxxxxxx, XX 00000-0000 Xxxxxxxxxxx, XX 00000-0000
Fax. No. (000) 000-0000 Fax. No. (000) 000-0000
Any party may, by notice so given to the other party, change the address to
which notices shall thereafter be sent. In all events, the postmark date of such
notice or notices shall be deemed the effective date of such notice for all
purposes hereunder.
13.14) No Shop. Prior to the Closing Date, or earlier termination of
this Agreement, Valley and UFC shall not, directly or indirectly, and shall not
permit or cause any member of the Bank Group to, solicit, initiate or encourage
the submission of inquiries, proposals or offers from any person or entity
relating to any acquisition or purchase of assets of, or any equity interest in,
any member of the Bank Group, or any tender offer, exchange offer, merger,
consolidation, business combination, sale of substantial assets or of a material
amount of assets, sale of securities, recapitalization, liquidation, dissolution
or similar transactions involving any member of the Bank Group (each a
"Transaction"), provided, however, that nothing contained herein shall prevent
the Valley, UFC or their respective Boards of Directors from furnishing
information to, or entering into discussions or negotiations with, any person or
entity in connection with an unsolicited bona fide written offer regarding a
Transaction, if and only to the extent that such Board of Directors determines
in good faith (upon the advice of outside legal counsel) that such action is
required for such Board of Directors to comply with its fiduciary duties to
stockholders under applicable law and subject to the payment of the Break Up Fee
as further provided in Section 13.17.
13.15) Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
13.16) Arbitration. In the event of any dispute, claim or controversy
arising under this Agreement, the same shall be settled at Minneapolis,
Minnesota, by arbitration under the rules of commercial arbitration of the
American Arbitration Association, as modified by this Section 13.16. Any party
may, by written notice to the other parties after such a controversy has arisen
hereunder, appoint one arbitrator. The other parties to the controversy shall,
by written notice, within fifteen (15) days after the receipt of such notice by
the first party, appoint a second arbitrator, and in default of such appointment
the first arbitrator appointed shall be the sole arbitrator. When two (2)
arbitrators have been appointed as hereinabove provided, they shall, if
possible, agree on a third arbitrator who shall be appointed by written notice
signed by both of them with a copy mailed to each party hereto within fifteen
(15) days after such appointment. In the event fifteen (15) days shall elapse
after the appointment of the second arbitrator without notice of appointment of
the third arbitrator as hereinabove provided, then any party may in writing
request a Judge of the Minnesota District Court, in the County of Hennepin, to
appoint a third arbitrator. The arbitrators shall follow substantive rules of
law and the Federal Rules of Evidence and allow the parties to conduct discovery
pursuant to the Federal Rules of Civil Procedure for a period not to exceed
sixty (60) days. After receiving evidence and hearing witnesses, if any, the
arbitrators shall render their award, accompanied by findings of fact and a
statement of reasons for the decision. The award of the majority of the
arbitrators shall be conclusive and binding upon the parties. Any award rendered
therein may be entered in any court having jurisdiction thereof. The costs and
expenses of arbitration (excluding legal and expert fees of the parties, if any)
shall be paid equally by the parties. The parties further acknowledge and agree
that arbitration under this Section 13.16 may be utilized to resolve both
pre-closing and post-closing disputes under this Agreement.
13.17 Break Up Fee. In the event that Valley enters into discussions or
negotiations with any person or entity in connection with an unsolicited bona
fide written offer regarding a Transaction in accordance with Section 13.14 and
as a result thereof seeks to be released from its obligations under and
otherwise terminate this Agreement, then Valley shall pay Marquette
the Break Up Fee, and, upon payment of such fee, this Agreement may be
terminated by Valley in accordance with Section 13.1. In the event that UFC (a)
fails to vote the UFC Shares in favor of the transactions contemplated by this
Agreement in accordance with Section 8.4, or (b) enters into discussions or
negotiations with any person or entity in connection with an unsolicited bona
fide written offer regarding a Transaction in accordance with Section 13.14 and
as a result thereof seeks to be released from its obligations under and
otherwise terminate this Agreement, then UFC shall cause Valley to pay Marquette
the Break Up Fee (defined below), and, upon payment of such fee, this Agreement
may be terminated by UFC in accordance with Section 13.1. The "Break Up Fee"
payable under this section shall be the sum of five hundred thousand dollars
($500,000) and, notwithstanding Sections 8.4 and 13.14, neither Valley nor UFC
shall be relieved of their obligations under this Agreement until the Break Up
Fee shall be paid in full to Marquette.
THE PARTIES have executed this Agreement in the manner appropriate for
each, as of the day and year first above written.
Valley Bancorp, Inc.
By /s/ Xxxx X. Xxxxx
--------------------------------------------
Xxxx X. Xxxxx
-----------------------------------
Its Chairman
-----------------------------------------
United Financial Corp.
By /s/ Xxxx X. Xxxxx
--------------------------------------------
Xxxx X. Xxxxx
-----------------------------------
Its Chairman
-----------------------------------------
Marquette Financial Companies
By /s/ Xxxx Xxxxxxx Xxxxxx
-----------------------------------------
Xxxx Xxxxxxx Xxxxxx
-----------------------------------
Its CFO
-----------------------------------------
c
