EXHIBIT 10(I)
AGREEMENT AND PLAN OF REORGANIZATION
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This Agreement and Plan of Reorganization (the "Agreement") dated as of the
28th day of August, 1998, is made by and among GOLD BANC CORPORATION, INC., a
Kansas corporation ("Gold"), GOLD BANC ACQUISITION CORPORATION VIII, INC., a
Kansas corporation, or any other subsidiary of Gold as a permitted assignee
("Sub") and THE TRUST COMPANY, a Missouri corporation ("Company").
WITNESSETH:
WHEREAS, the Boards of Directors of Gold, Sub and Company have approved and
deem it advisable and in the best interests of their respective companies and
shareholders that Gold and Company become affiliated through the merger of
Company with and into Sub in the manner hereinafter set forth (the "Merger" or
the "Company Merger"); and
WHEREAS, the parties desire to make certain representations, warranties and
agreements in connection with the Merger and also to prescribe certain
conditions to the Merger.
NOW, THEREFORE, in consideration of the premises and the mutual covenants
and agreements herein contained, the parties hereby agree as follows:
ARTICLE I
THE COMPANY MERGER
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1.1 The Company Merger. Upon the terms and subject to the conditions of
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this Agreement at the Effective Time (as hereinafter defined), Company shall be
merged with and into Sub and the separate existence and corporate organization
of Company shall thereupon cease and Sub and Company shall thereupon be a single
corporation. Sub shall be the surviving corporation in the Merger and the
separate corporate existence of Sub shall continue unaffected and unimpaired by
the Merger.
1.2 Effective Time of the Company Merger. On the Closing Date (as
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hereinafter defined), the proper officers of Company and Sub shall execute and
acknowledge appropriate certificates of merger that shall be filed with the
Kansas and Missouri Secretaries of State on the first business day following the
Closing Date, all in accordance with the Kansas General Corporation Code (the
"KGCC") and The General and Business Corporation Law of Missouri ("MGBCL"). The
Merger shall become effective on the first day of the first calendar month
following the Closing Date (the "Effective Time"). The closing shall be on a
day (the "Closing Date") occuring not less than two (2) and not more than five
(5) business days before the Effective Time and not later than forty-five (45)
days following the satisfaction or waiver, to the extent permitted hereunder, of
the last of the conditions to the consummation of the Merger specified in
Articles VII and VIII of this Agreement at 10:00 a.m. at Gold Banc Corporation,
00000 Xxxx Xxxxxx, Xxxxxxx, Xxxxxx, which day shall be specified by notice from
Gold to
Company (such notice to be at least five (5) days in advance of such Closing
Date), or on such other date and at such other place and time as the parties
hereto may mutually agree.
1.3 The Articles of Incorporation. The Articles of Incorporation and By-
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Laws of Sub as in effect immediately prior to the Effective Time shall be and
remain the Articles of Incorporation and By-Laws of the surviving corporation
from and after the Effective Time until amended as provided by law and the
officers and directors of Sub shall continue as the officers and directors of
the surviving corporation from and after the Effective Time.
1.4 Effect of Company Merger. Subject to Kansas and Missouri law, at the
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Effective Time (a) Sub shall possess all assets and property of every
description, and every interest therein, wherever located, and the rights,
privileges, immunities, powers, franchises, and authority, of a public as well
as of a private nature, of Company and all obligations belonging to or due each
of Company and Sub shall be vested in Sub without further act or deed; (b) title
to any real estate or any interest therein vested in Company shall not revert or
in any way be impaired by reason of the Company Merger; (c) all rights of
creditors and all liens on any property of the Company shall be preserved
unimpaired; and (d) Sub shall be liable for all the obligations of Company, and
any claim existing, or action or proceeding pending, by or against either of
Company or Sub, may be prosecuted to judgment with the right of appeal, as if
the Company Merger had not taken place.
1.5 Further Assurances. If at any time after the Effective Time, Sub
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shall consider it advisable that any further conveyances, agreements, documents,
instruments or assurances of law or any other actions or things are necessary or
desirable to vest, perfect, confirm, or record in Sub the title to any property,
rights, privileges, powers, or franchises of the Company, the former Board of
Directors and officers of the Company shall, and will be authorized to, execute
and deliver in the name and on behalf of the Company or otherwise, any and all
proper conveyances, agreements, documents, instruments, and assurances of law
and do all things necessary or proper to vest, perfect, or confirm title to such
property, rights, privileges, powers and franchises in Sub, and otherwise to
carry out the provisions of this Agreement.
ARTICLE II
PROVISIONS OF MERGER TRANSACTION
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2.1 Effect of Merger on Sub Stock. At the Effective Time, each share of
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common stock, $1.00 par value per share, of Sub ("Sub Common Stock") issued and
outstanding immediately prior to the Effective Time shall remain issued and
outstanding, and shall be unaffected by the Company Merger.
2.2 Conversion of the Company Shares in the Company Merger. At the
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Effective Time, by virtue of the Merger and without any action on the part of
any holder thereof:
(a) Each share of common stock, $5.00 par value per share of the
Company ("Company Common Stock"), that is either authorized but unissued or held
in the treasury of the Company, if any, or held by the Company or any subsidiary
of the Company other than as trustee, fiduciary, nominee or some similar
capacity shall be canceled and retired and shall cease
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to exist from and after the Effective Time, and no cash or other consideration
shall be delivered in exchange therefore;
(b) Each outstanding share of Company Common Stock, of which Thirty
Thousand (30,000) shares are issued and outstanding (but excepting Company
Dissenting Shares as defined below) shall be converted into 10.0 shares (the
"Exchange Ratio") of common stock, $1.00 par value per share of Gold ("Gold
Common Stock") with fractions of shares rounded to the nearest 1/1000th of a
share.
2.3 Exchange of Certificates.
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(a) Gold, on behalf of Sub, shall make available to Exchange National
Bank and/or to Midwest Capital Management, Inc., which are hereby designated as
exchange agents (the "Exchange Agents"), at and after the Effective Time, such
number of shares of Gold Common Stock as shall be issuable to the holders of
Company Common Stock in accordance with Section 2.2 hereof. As soon as
practicable after the Closing Date, Gold, on behalf of the Exchange Agents,
shall, except as set forth in subparagraph (b) of this Section 2.3, mail to each
holder of record of a certificate that immediately prior to the Closing Date
represented outstanding shares of Company Common Stock (i) a form letter of
transmittal and (ii) instructions for effecting the surrender of certificates of
Company Common Stock for exchange into certificates of Gold Common Stock. The
Gold Common Stock into which the Company Common Stock is being converted in
accordance with Section 2.2(b) hereof may be delivered to a brokerage account
established at Midwest Capital Management, Inc. for each shareholder of the
Company.
(b) All parties acknowledge and agree that the Company is a defendant
in litigation pending in the United States District Court for the Western
District of Louisiana, Lake Xxxxxxx Division. Such case is captioned Xxxx Xxxxx
Bank & Trust Company, as Trustee of the Coushatta Minors Trust, and the
Coushatta Tribe of Louisiana v. The Trust Company, et al. Such case is referred
to herein as the "Louisiana Litigation". As a result of the pendency of such
litigation as of the date hereof, the parties agree that if such litigation is
still pending as of the Closing Date, then 15,000 shares of Gold Common Stock
which would otherwise be mailed to shareholders of the Company ("Company
Shareholders") in accordance with the terms of this Article II shall be held in
escrow by the secretary of Gold or his designee (the "Escrow Holder") until such
litigation is fully and finally resolved (including a complete resolution of any
appeals or expiration of any appeal rights). The shares being held in escrow by
the Escrow Holder are referred to herein as the "Escrowed Shares". While the
Escrowed Shares are being held by the Escrow Holder, such shares may not be
sold, pledged, assigned, hypothecated, gifted or otherwise transferred. However,
while such shares are being held by the Escrow Holder, the beneficial owners
thereof shall be entitled to exercise voting rights with respect to the Escrowed
Shares and shall be entitled to receive dividends or distributions made with
respect to the Escrowed Shares. Each Company Shareholder entitled to receive
shares of Gold Common Stock (including any Dissenting Shareholder) shall have
shares of Gold Common Stock which would otherwise be received by such
Shareholder held as part of the Escrowed Shares. The number of Escrowed Shares
to be held with respect to each Company Shareholder shall be determined by
multiplying 15,000 by a fraction, the numerator of which is the number of shares
of Company
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Common Stock owned such shareholder as of the effective time and the denominator
of which is 30,000. Gold and Sub reserve the right to round the number of shares
applicable to each shareholder to the next highest even number of shares to
avoid requisite issuance of fractional shares. If any Company Shareholder
dissents with respect to this transaction, such Dissenting Shareholder shall
nonetheless participate in such escrow and the shares of Gold Common Stock
allocable to such shareholder shall be held in escrow in accordance with this
paragraph until escrow terminates as provided herein at which time such
Dissenting Shareholder shall receive his, her or its entitlement subject to the
rights of Gold and Sub hereunder.
At such time as the Louisiana Litigation is fully and finally resolved (and
the Company is released from any further claim or liability with respect thereto
either as a result of a settlement among the parties or final disposition of the
pending litigation, including the exhaustion of all appeal rights or the
expiration of all time periods to appeal), the escrow established hereunder
shall terminate and the Escrowed Shares shall be distributed as provided herein.
If the Company is not required to pay any amount to the plaintiffs in the
Louisiana Litigation either in settlement or as a result of a judgment rendered
in such case, then the Escrowed Shares shall be delivered to the shareholders
and they shall continue to hold same free of escrow (but subject to all other
restrictions as provided herein). If as a result of the disposition of the
Louisiana Litigation, however, the Company makes any payment (in cash or in
kind) to one or more of the plaintiffs in the Louisiana Litigation, then the
Company Shareholders agree that Gold shall be entitled to retain a sufficient
number of the Escrowed Shares such that the value of the shares retained by Gold
equals the total payments made to the plaintiffs in the Louisiana Litigation by
the Company. For purposes of the immediately preceding sentence, the value of
the Escrowed Shares shall be determined in the same manner that the Gold Stock
Price is determined in subparagraph (c) immediately hereafter. The retention of
such shares by Gold shall be on a pro rata basis with respect to the shares held
on behalf of each Company Shareholder such that each Company Shareholder shall
be deemed to be contributing pro rata (based upon each such Shareholder's
proportion of the Escrowed Shares). To the extent any dividends have been paid
to Company Shareholders with respect to Escrowed Shares retained by Gold in
connection with the provisions hereof, the Company Shareholder shall immediately
repay such dividends previously received to Gold upon receipt of written notice
of to repay the same from Gold. Such shares retained by Gold shall be deemed
retained in satisfaction of an indemnity obligation of the Company Shareholders
which shall be separate and a part from any and all other indemnity obligations
as set forth in Article IX hereinafter. Such shares shall be held as treasury
shares or retired as determined by Gold. The remaining Escrowed Shares shall
then be distributed to the shareholders (with attendant payment made to any
Dissenting Shareholder in lieu of distributing such shares to such Dissenting
Shareholder). If the consideration payable by the Company to the plaintiffs in
the Louisiana Litigation exceeds the total value of the Escrowed Shares, then
Gold shall retain all Escrowed Shares and the Company Shareholders (including
any Dissenting Shareholder) shall have no further claim with respect thereto. It
is agreed by all parties hereto that the provisions of this Section 2.3(b)shall
in no way affect the rights of any party to indemnification as provided under
Article IX except to the extent that an indemnification claim is satisfied as a
result of Gold's retention of Escrowed Shares as provided herein.
(c) Notwithstanding any other provision herein, no fractional shares
of Gold Common Stock and no certificates or script therefor or other evidence of
ownership thereof will
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be issued. All fractional shares of Gold Common Stock to which a holder of
Company Common Stock would otherwise be entitled to under Section 2.2 hereof
shall be aggregated. If a fractional share results from such aggregation, such
shareholder shall be entitled, after the Effective Time and upon the surrender
of such shareholder's certificate or certificates representing shares of Company
Common Stock, to receive from the Exchange Agent an amount in cash in lieu of
such fractional share equal to the product of such fraction and the average of
the closing sales price of Gold Common Stock as reported by the National
Association of Securities Dealers Automated Quotation National Marketing System
on each of the ten consecutive trading days immediately preceding the third
trading day prior to the Effective Time (the "Gold Stock Price"). Gold, on
behalf of Sub, shall make available to the Exchange Agent, as required from time
to time, any cash necessary for this purpose.
2.4 Closing of the Company Transfer Books. At the Effective Time, the
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stock transfer books of the Company shall be closed and no transfer of Company
Common Stock shall thereafter be made.
2.5 Dividends. No dividends or other distributions that are declared
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after the Effective Time with respect to Gold Common Stock payable to holders of
record thereof after the Effective Time shall be paid to the Company
shareholders entitled to receive certificates representing Gold Common Stock
until such shareholders surrender to the Exchange Agent their certificates
representing Company Common Stock. Upon such surrender, there shall be paid to
the shareholder in whose name the certificates representing such Gold Common
Stock shall be issued any dividends which shall have become payable with respect
to such Gold Common Stock between the Effective Time and the time of such
surrender, without interest. After such surrender there shall also be paid to
the shareholder in whose name the certificates representing such Gold Common
Stock shall be issued any dividend on such Gold Common Stock that shall have (a)
a record date subsequent to the Effective Time and prior to such surrender and
(b) a payment date after such surrender, and such payment shall be made on such
payment date. In no event shall the shareholders entitled to receive such
dividends be entitled to receive interest on such dividends.
2.6 Shareholders' Approval. Company agrees to submit this Agreement and
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the transactions contemplated hereby to its shareholders for approval to the
extent required and as provided by law and the Articles of Incorporation and By-
Laws of Company and in accordance with Section 10.1 hereof. A shareholders'
meeting of Company shall be held and Company shall use its reasonable best
efforts to take all steps as shall be required for said meeting to be held as
soon as reasonably practicable after the effective date of the Registration
Statement (as defined in Section 10.1 hereof). Company and its Board of
Directors shall recommend that the shareholders of Company approve this
Agreement and the transactions contemplated hereby and shall use their
reasonable best efforts to secure such approval.
2.7 Dissenting Shares. Notwithstanding anything to the contrary contained
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in this Agreement, to the extent appraisal rights are available to the Company's
shareholders pursuant to the KGCC and the MGBCL, any shares of Company Common
Stock held by a person who objects to the Merger, whose shares of Company Common
Stock were not entitled to vote or were not voted in favor of the Merger and who
complies with all of the provisions of the KGCC
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and the MGBCL concerning the rights of such person to dissent from the Merger
and to require appraisal of such person's shares of Company Common Stock and who
has not withdrawn such objection or waived such rights prior to the Closing Date
("Company Dissenting Shares") shall not be converted pursuant to Section 2.2 but
shall become the right to receive such consideration as may be determined to be
due to the holder of such Company Dissenting Shares pursuant to the KGCC and the
MGBCL, including, if applicable, any costs determined to be payable by Sub or
the Company to the holders of the Company Dissenting Shares pursuant to an order
of the district court in accordance with the KGCC. Notwithstanding the
foregoing, as set forth hereinafter, the obligation of Gold to close on this
transaction is contingent upon the total required cash payments due Company's
shareholders totaling less than 5% of the total consideration being provided by
Gold to Company as consideration for this Merger.
2.8 Adjustments. If at any time during the period between the date hereof
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and the Effective Time, any change in the outstanding shares of Gold Common
Stock is effected by reason of any reclassification, recapitalization, stock
split or combination, exchange or readjustment of shares, or any stock dividend
thereon with a record date during such period, the Exchange Ratio shall be
adjusted on a pro rata basis.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF GOLD AND SUB
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Except as set forth on the Gold Disclosure Schedule attached hereto, Gold
and Sub, jointly and severally, hereby represent and warrant to the Company and
the Shareholders of the Company as follows:
3.1 Organization and Authority.
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(a) Gold is a corporation duly organized, validly existing and in
good standing under the laws of the State of Kansas with the corporate power and
authority to own its properties and conduct its business as it is now being
conducted and is duly registered as a bank holding company under the provisions
of the Bank Holding Company Act of 1956, as amended.
(b) Sub is a corporation duly organized, validly existing and in good
standing under the laws of the State of Kansas. Sub has the corporate power to
enter into and perform this Agreement and the execution, delivery and
performance of this Agreement by Sub and the consummation by Sub of the
transactions contemplated hereby have been duly authorized by its Board of
Directors and by Gold as the sole shareholder of Sub.
3.2 Authority. Gold has all requisite corporate power and authority to
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enter into this Agreement, and to consummate the transactions contemplated
hereby. The execution, delivery and performance of this Agreement, and the
consummation by Gold of the transactions contemplated hereby, have been duly
authorized by all necessary corporate action on the part of Gold. This Agreement
has been duly executed and delivered by Gold, and assuming due execution and
delivery by Company, constitutes a valid and binding obligation of Gold,
enforceable against Gold in accordance with its terms subject to applicable
conservatorship,
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receivership, bankruptcy, insolvency and similar laws affecting creditors'
rights and remedies generally, and subject, as to enforceability, to general
principles of equity (including without limitation specific performance),
whether applied in a court of law or a court of equity.
3.3 No Gold Shareholder Approval. The shareholders of Gold are not
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required to approve this Agreement.
3.4 No Violations. Subject to approval by the appropriate regulatory
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agencies, the execution, delivery and performance of this Agreement by Gold and
Sub do not, and the consummation of the transactions contemplated hereby will
not, constitute (i) a breach or violation of, or a default under, any law, rule
or regulation or any judgment, decree, order, governmental permit or license, or
agreement, indenture or instrument of Gold or any subsidiary of Gold or to which
Gold or any subsidiary (or any of their respective properties) is subject, (ii)
a breach or violation of, or a default under, the articles of incorporation,
charter or bylaws of Gold or any subsidiary of Gold or (iii) a breach or
violation of, or a default under (or an event which with due notice or lapse of
time or both would constitute a default under), or result in the termination of,
accelerate the performance required by, or result in the creation of any lien,
pledge, security interest, charge or other encumbrance upon any of the
properties or assets of Gold or any subsidiary of Gold under any of the terms,
conditions or provisions of any note, bond, indenture, deed of trust, loan
agreement or other agreement, instrument or obligation to which Gold or any
subsidiary of Gold is a party, or to which any of their respective properties or
assets may be bound or affected.
3.5 Consents. Except for approvals of the appropriate regulatory agencies
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and such filings and registrations as are required under federal and state
securities and blue sky laws, no filing or registration with, or authorization,
consent or approval of, any public body or authority is necessary for the
consummation by Gold of the Merger or the other transactions contemplated by
this Agreement.
3.6 Capital Stock of Gold. Gold has authorized capital stock consisting
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of (a) 25,000,000 shares of common stock, $1.00 par value ("Gold Common Stock"),
of which 10,704,392 shares were issued and outstanding on June 30, 1998, (b)
$28.75 Million of 8.75% Junior Subordinated Deferrable Interest Debentures and
(c) 25,000,000 shares of preferred stock, none of which are issued and
outstanding. All of the issued and outstanding shares of Gold Common Stock are
validly issued, fully paid and non-assessable. Holders of Gold Common Stock do
not have any preemptive rights with respect to the issuance of additional
authorized shares of Gold Common Stock.
3.7 Government Regulation. Gold and its subsidiaries hold all material
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licenses, certificates, permits, franchises and rights from all appropriate
federal, state or other public authorities necessary for the lawful conduct of
their respective businesses and ownership of their respective properties. Gold
and its subsidiaries have substantially complied with all material federal,
state and local statutes, regulations, ordinances or rules applicable to the
ownership of their respective properties or the conduct of their respective
businesses.
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3.8 Financial Statements. The consolidated balance sheets of Gold as of
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December 31, 1997, the consolidated statement of earnings for the year ended
December 31, 1997, and all related schedules and notes to the foregoing, all of
which have been delivered to Company, have been certified by KPMG Peat Marwick
LLP, independent certified public accountants. All of the foregoing financial
statements, together with the financial statements of Gold dated as of June 30,
1998 and for the period then ending, have been prepared in accordance with
generally accepted accounting principles and practices which were applied on a
consistent basis, and present fairly in all material respects the financial
position, results of operation and changes of financial position of Gold as of
their respective dates and for the periods indicated. From June 30, 1998 until
the date hereof, there has been no material adverse change in the financial
condition, properties, assets, liabilities, business or prospects of Gold.
3.9 SEC Reports. Gold's Report on Form 10-K for year ended December 31,
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1997, filed with the Securities and Exchange Commission and all subsequent
reports and proxy statements filed by Gold thereafter pursuant to Section 13(a)
or 14(a) of the Securities Exchange Act of 1934 do not and will not contain a
misstatement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading as of
the time the document was filed. Since the filing of such Report on Form 10-K,
no other report, proxy statement, or other document has been required to be
filed by Gold pursuant to Section 13(a) or 14(a) of the Securities Exchange Act
of 1934 which has not been filed. Gold has delivered to Company the Form 10-K
for the fiscal year ended December 31, 1997 and unaudited financial statements
for the quarter ended June 30, 1998.
3.10 Status of Gold Common Stock to be Issued. The shares of Gold Common
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Stock into which the Company Common Stock are to be exchanged or converted
pursuant to this Agreement will be, when delivered as specified in this
Agreement, validly authorized and issued, fully paid and non-assessable.
However, such shares have not been registered under the Securities Act of 1933
(the "Securities Act") and are therefore "restricted securities" as that term is
used in Rule 144 under the Securities Act. Accordingly, such securities may not
be sold, transferred or otherwise disposed of unless they are subsequently
registered under the Securities Act or an exemption from registration is then
available.
3.11 Legal Proceedings. There are as of the date hereof no actions, suits,
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claims, demands or other proceedings or investigations, either judicial or
administrative, pending or, to the knowledge of Gold, threatened against or
affecting the properties, assets, rights or business of Gold or any subsidiary
of Gold or the right to carry on or conduct their business, nor are there to the
knowledge of Gold any grounds therefor, which, if adversely determined, would
have a material adverse effect on the business, operations, properties or
financial condition of Gold. There are as of the date hereof no actions, suits,
claims, demands or other proceedings or investigations, either judicial or
administrative, pending or, to the knowledge of Gold, threatened which will or
could prevent or interfere with the consummation of the transactions
contemplated by this Agreement.
3.12 Taxes. Gold and Sub have timely filed all federal, state and local
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tax returns required to be filed by them, and have timely paid and discharged
any taxes due in connection with all such tax returns. To the best knowledge of
Gold, the liability for taxes set forth on each
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such tax return adequately reflects the taxes due with respect to such returns.
Neither the Internal Revenue Service nor any other taxing authority is now
asserting, either through audits, administrative proceedings, court proceedings
or otherwise any deficiency or claim for additional taxes against Gold or Sub or
any subsidiary of Gold. Neither Gold nor Sub has granted any waiver of any
statute of limitations with respect to, or any extension of a period for the
assessments of, any tax. There are no tax liens on any of the assets of Gold or
Sub or any subsidiary of Gold.
3.13 Defaults. Neither Gold nor any of its subsidiaries is in material
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breach or material default under any agreement or commitment to which Gold or
any of its subsidiaries is a party, or under any loan agreement, note, security
agreement, guarantee or other document pursuant to or in connection with Gold's
or any of its subsidiaries' extension of credit; and, to their knowledge, there
has not occurred any event which, after the giving of notice, the lapse of time
or otherwise, would constitute any such default under, or result in any such
breach of, any such agreement, commitment or extension of credit.
3.14 Absence of Adverse Agreements. Neither Gold nor Sub nor any
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subsidiary of Gold is a party to any agreement or instrument or any judgment,
order or decree or any rule or regulation of any court or other governmental
agency or authority which materially and adversely affects or in the future may
have a material adverse effect on the financial condition, results or
operations, assets, business or prospects of Gold or Sub or any subsidiary of
Gold, taken as a whole.
3.15 Broker's Fees. Neither Gold nor Sub nor any of their respective
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officers or directors has employed any broker or finder or incurred any
liability for any broker's fees, commissions or finder's fees in connection with
any of the transactions contemplated by this Agreement.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF COMPANY
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Except as set forth on the Company Disclosure Schedule hereto, Company
hereby represents and warrants to each of Gold and Sub as follows:
4.1 Organization and Good Standing.
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(a) Company is a corporation duly organized, validly existing and in
good standing under the laws of the State of Missouri with the corporate power
and authority to own its properties and conduct its business as it is now being
conducted and is duly registered to conduct business as it is currently
conducting such business. The conduct of Company's business and the ownership of
its properties do not require Company to qualify as a foreign corporation in any
jurisdiction except where the failure to be so qualified individually or in the
aggregate would not materially and adversely affect the business, operations,
properties or financial condition of Company and its subsidiary.
(b) Company has no subsidiaries.
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4.2 Authority. Company has all requisite corporate power and authority to
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enter into this Agreement, and to consummate the transactions contemplated
hereby. The execution and delivery of this Agreement, and the consummation of
the transactions contemplated hereby have been duly authorized by all necessary
corporate action on the part of Company. This Agreement has been duly executed
and delivered by Company, and assuming due execution and delivery by Gold,
constitutes a valid and binding obligation of Company, enforceable in accordance
with its terms subject to applicable conservatorship, receivership, bankruptcy,
insolvency and similar laws affecting creditors' rights and remedies generally,
and subject, as to enforceability, to general principles of equity (including
without limitation specific performance), whether applied in a court of law or a
court of equity.
4.3 Shareholder Approval. The Board of Directors of Company has directed
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or will direct, that this Agreement and the transactions contemplated hereby be
submitted to the Company's shareholders for approval at a meeting of such
shareholders and, except for adoption of this Agreement by the requisite vote of
the Company's shareholders, no other shareholder action is necessary to approve
this Agreement and to consummate the transactions contemplated hereby. The Board
of Directors will recommend that the shareholders approve the transactions
contemplated hereby, subject to their fiduciary duties. The approval of the
majority of the outstanding shares of Company Common Stock entitled to vote with
respect to such matter is required for approval of this Agreement and to
consummate the transactions contemplated hereby. No approval of a number of
outstanding shares of Company greater than that required by the relevant
statutory provisions is required for approval of this Agreement and the
consummation of the transactions contemplated hereby.
4.4 No Violations. Except for the approvals of the appropriate regulatory
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agencies and such filings and registrations as are required under federal and
state securities and blue sky laws, the execution, delivery and performance of
this Agreement by Company does not, and the consummation of the transactions
contemplated hereby will not, constitute (i) a breach or violation of, or a
default under, any law, rule or regulation or any judgment, decree, order,
governmental permit or license, or agreement, indenture or instrument of Company
or to which Company (or any of its properties) is subject, (ii) a breach or
violation of, or a default under, the articles of incorporation, charter or
bylaws of Company or (iii) a breach or violation of, or a default under (or an
event which with due notice or lapse of time or both would constitute a default
under), or result in the termination of, accelerate the performance required by,
or result in the creation of any lien, pledge, security interest, charge or
other encumbrance upon any of the properties or assets of Company under any of
the terms, conditions or provisions of any note, bond, indenture, deed of trust,
loan agreement or other agreement, instrument or obligation to which the Company
is a party, or to which any of its properties or assets may be bound or
affected.
4.5 Consents. Except for the approvals of the appropriate regulatory
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agencies and such filings and registrations as are required under federal and
state securities and blue sky laws, no filing or registration with, or
authorization, consent or approval of, any public body or authority is necessary
for the consummation by Company of the Merger or the other transactions
contemplated by this Agreement.
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4.6 Capitalization. Company has authorized capital stock consisting of
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30,000 shares of common stock, par value $5.00 per share, of which 30,000 shares
are issued and outstanding. All of the issued and outstanding shares of Company
Common Stock are validly issued, fully paid and non-assessable. There are no
outstanding warrants, options, subscriptions, contracts, rights or other
agreements or commitments obligating Company to issue or sell any additional
shares of Company Common Stock nor are there outstanding any securities, debts,
obligations or rights which are convertible into or exchangeable for shares of
Company Common Stock.
4.7 Government Regulation. Company holds all material licenses,
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certificates, permits, franchises and rights from all appropriate federal, state
or other public authorities necessary for the lawful conduct of its respective
businesses and ownership of its properties. Company has substantially complied
with all material federal, state and local statutes, regulations, ordinances or
rules applicable to the ownership of its respective properties or the conduct of
its business.
4.8 Financial Statements. The Company has previously delivered to Gold
--------------------
and Sub balance sheets for the Company as of June 30, 1998, December 31, 1997
and December 31, 1996, the statements of earnings for the period ended June 30,
1998 and for the years ended December 31, 1997 and December 31, 1996, and all
related schedules and notes to the foregoing (collectively the "Company
Financial Statements"). Although such statements have not been certified as of
the date hereof by independent certified public accountants, the Company
Financial Statements have been prepared (except for the absence of notes
thereto) in accordance with generally accepted accounting principles and
practices which were applied on a consistent basis, and present fairly in all
material respects the financial position, results of operation and changes of
financial position of Company as of their respective dates and for the periods
indicated. Company has no material liabilities or obligations whether related to
tax or non-tax matters, accrued or contingent, due or not yet due, liquidated or
unliquidated, or otherwise, except as and to the extent disclosed or reflected
in the balance sheet of Company as of June 30, 1998, or incurred since June 30,
1998, in the ordinary course of business. From June 30, 1998 until the date
hereof, there has been no material adverse change in the financial condition,
properties, assets, liabilities, rights or business of Company or in the
relationship of Company with respect to its employees, creditors, suppliers,
distributors, customers or others with whom it has business relationships.
4.9 Legal Proceedings. Except for the Louisiana Litigation referenced in
-----------------
Section 2.3(b) above, there are as of the date hereof no actions, suits, claims,
demands or other proceedings or investigations, either judicial or
administrative, pending or, to the knowledge of Company, threatened against or
affecting the properties, assets, rights or business of Company or the right to
carry on or conduct its business, nor are there to the knowledge of Company any
grounds therefor, which, if adversely determined, would in the aggregate
materially adversely affect the business, operations, properties or financial
condition of Company. There are as of the date hereof no actions, suits,
claims, demands or other proceedings or investigations, either judicial or
administrative, pending or, to the knowledge of Company, threatened which will
or could prevent or interfere with the consummation of the transactions
contemplated by this Agreement. The Company agrees to advise Gold and Sub if at
any time between the date hereof and the Effective Time, any legal proceeding as
described in this paragraph is initiated or, to the knowledge of Company,
threatened.
11
4.10 Title to Assets. Company has good and marketable title to and
---------------
possession of all of its real and personal properties and assets, in each case
free and clear of any liens, restrictions, encumbrances, rights, title and
interests of others, except as reflected on the Company Financial Statements and
except for the lien of current taxes, covenants and restrictions of record, and
other minor imperfections of title not affecting marketability, which liens,
covenants, restrictions and imperfections do not materially affect the value of
such property and do not interfere with the use made of such property by
Company. The real and personal properties and assets held under lease by
Company are held by it under valid, subsisting and enforceable leases with such
exceptions as do not interfere with the use made of such properties and assets
by Company. No consent is necessary under the terms of any such lease in
connection with the consummation of the transactions contemplated hereby.
4.11 Undisclosed Liabilities. As of the date hereof, the Company does not
-----------------------
have any debt, liability or obligation (whether accrued, contingent, absolute or
otherwise) known to it of the nature which would customarily be included in a
corporate balance sheet or the notes thereto prepared in accordance with
generally accepted accounting principles that is not reflected or reserved
against in the Company Financial Statements or was not incurred in the ordinary
course of their business.
4.12 Taxes. The Company has timely filed all tax returns required to be
-----
filed by it, and the Company has timely paid and discharged all taxes due in
connection with or with respect to the filing of such tax returns and have
timely paid all other taxes as are due, except such as are being contested in
good faith by appropriate proceedings and with respect to which the Company is
maintaining reserves adequate for their payment. To the best knowledge of the
Company, the liability for taxes set forth on each such tax return adequately
reflects the taxes required to be reflected on such tax return. Neither the IRS
nor any other governmental entity or taxing authority or agency is now
asserting, either through audits, administrative proceedings, court proceedings
or otherwise, or, to the best of Company's knowledge, threatening to assert
against Company any deficiency or claim for additional taxes. The Company has
not granted any waiver of any statute of limitations with respect to, or any
extension of a period for the assessment of, any tax. There are no tax liens on
any assets of the Company. The Company has not received a ruling or entered
into an agreement with the Internal Revenue Service or any other governmental
entity or taxing authority or agency that would have a material adverse effect
on the Company, taken as a whole, after the Effective Time. The Company agrees
to provide assistance in the preparation of income tax returns for the Company
from the commencement of the current fiscal year through the Effective Time with
such returns to be completed within ninety (90) days of the Effective Time.
4.13 Contracts. The Company is not a party to nor bound by any:
---------
(a) employment contract or letter or other writing relating to
employment;
(b) bonus, deferred compensation, savings, profit sharing, severance
pay, pension or retirement plan or arrangement;
12
(c) material lease or license with respect to any property, real or
personal, whether Company is landlord or tenant, licensor or licensee, involving
a liability or obligation of Company as obligor in excess of $5,000 on an annual
basis or over the life of the lease or license.
(d) agreement, contract or indenture relating to the borrowing of
money by Company;
(e) agreement with any present or former officer, director or
shareholder of Company; or
(f) except as listed in the disclosure statement, other contract,
agreement or other commitment which is material to the business, operations,
property, prospects or assets or to the condition, financial or otherwise, of
Company or which involve a payment by Company of more than $10,000 in one year
or over the life of such contract, agreement or commitment.
4.14 Regulatory Reports; Examinations. Company has timely filed all
--------------------------------
material reports, registrations and statements, together with any amendments
required to be made with respect thereto, with all governmental or regulatory
authorities, agencies, courts, commissions or other entity ("Governmental
Entity") and has paid all fees and assessments due and payable in connection
therewith. Except for normal examinations conducted by a Governmental Entity in
the regular course of the business of Company, no Governmental Entity has
initiated any proceeding or, to the best knowledge of Company, investigation
into the business or operations of Company. There is no unresolved material
violation, criticism, or exception by any Governmental Entity with respect to
any report or statement relating to any examinations of Company. Company has
provided or made available to Gold all reports of examinations conducted by any
Governmental Entity with respect to Company, and all correspondence between
Company and any Governmental Entity during the preceding three (3) years.
Company will also provide to Gold and Sub any subsequent correspondence or
reports of examination received from any Government Entity between the date
hereof and the Effective Time.
4.15 Conduct. From June 30, 1998 until the date hereof:
-------
(a) There has been no material adverse change in the financial
condition of, or in the properties, assets, liabilities, rights or business,
taken as a whole, of Company or in the relationship of Company with respect to
its employees, creditors, suppliers, distributors, customers or others with whom
it has business relationships.
(b) The business affairs of Company have been conducted and carried
on only in the ordinary and regular course of business, and Company has not
incurred or become subject to any liabilities or obligations other than those
incurred in their ordinary course of business, those incurred pursuant to
existing contracts disclosed pursuant to Section 4.13 and those incurred
pursuant to commitments permitted hereby.
(c) The Company has not entered into any employment contract with any
director, officer or salaried employee, paid any or made any accrual or
arrangement for payment
13
of bonuses or special compensation of any kind or any severance or termination
pay to any of its officers, employees or directors, increased the rate of
compensation, if any, or instituted or made any material increase in any
officer's, employee's or director's welfare, retirement or similar plan or
arrangement, other than merit increases made in accordance with past practices
and procedures which have not exceeded the greater of $3,000 or 5% on an annual
basis for any one individual.
4.16 Compliance with ERISA. The Company has not established, maintained or
---------------------
contributed at any time during the five-year period ending as of the Effective
Time to any employee benefit plan (as defined in Sections 3(3) or 3(37) of the
Employment Retirement Income Security Act of 1974 ("ERISA")) or any other plan
with respect to which any governmental filings are required, except for the
plans listed on Schedule 4.16 (collectively, the "Plans"). A true and accurate
copy of each of the Plans, any related trust agreements and each of the
amendments thereto has been provided to Gold together with (i) all determination
letters received in respect of any qualified plans, and (ii) all required
reports and supporting schedules filed with any government agency in respect of
the Plans for the three most recent years ending on or before the Effective
Time. To Company's knowledge as sponsor of the Plans, the Plans and each
fiduciary (as defined in Section 3(21) of ERISA) of the Plans are in compliance
in all material respects with all applicable requirements (including
nondiscrimination requirements in effect as of the Effective Time) of the
Internal Revenue Code of 1986 ("Code"), including, but not limited to, Sections
79, 105, 106, 125, 401, 501, and 4975 of the Code. For purposes of this Section
4.16, noncompliance with the Code or ERISA is material if such noncompliance
could have a Material Adverse Effect on the condition of one or more of the
Plans or of Company, either as of the Effective Time or upon discovery of the
noncompliance. To Company's knowledge as sponsor of the Plans, all required
contributions to the Plans through the Effective Time have been made. To
Company's knowledge as sponsor of the Plans, Company (with respect to the
Plans), as well as the Plans, have no material current or threatened liability
of any kind to any person, including but not limited to any government agency,
now or as of the Effective Time, other than for the payment of benefits in the
ordinary course.
4.17 Defaults. The Company is not in material breach or material default
--------
known to it under any agreement or commitment to which the Company is a party or
under any loan agreement, note, security agreement, guarantee or other document
pursuant to which the Company is a party; and to its knowledge there has not
occurred any event which, after the giving of notice, the lapse time or
otherwise, would constitute any such default under, or result in any such breach
of, any such agreement.
4.18 Insurance. Complete and correct copies of all material policies of
---------
fire, product or other liability, workers' compensation and other similar forms
of insurance owned or held by Company have been delivered or made available to
Gold. Subject to expirations and renewals of insurance policies in the ordinary
course of business, all such policies are in full force and effect, all premiums
with respect thereto covering all periods up to and including the date as of
which this representation is being made have been paid (other than retrospective
premiums which may be payable with respect to worker's compensation insurance
policies), and no notice of cancellation or termination has been received with
respect to any such policy. Such policies are and shall remain valid,
outstanding and enforceable policies, and will not be terminated prior to
14
the Effective Time. To the best knowledge of Company, the insurance policies to
which Company is a party are sufficient for compliance with all material
requirements of law and all material agreements to which Company is a party and
will be maintained by Company until the Effective Time. The Company has not been
refused any insurance with respect to any material assets or operations, nor has
coverage been limited in any respect material to its operations by any insurance
carrier to which it has applied for any such insurance or with which it has
carried insurance during the last five (5) years.
4.19 Absence of Adverse Agreements. The Company is not a party to any
-----------------------------
agreement or instrument or any judgment, order or decree or any rule or
regulation of any court or other governmental agency or authority which
materially and adversely affects or in the future may have a material adverse
effect on the financial condition, results or operations, assets, business or
prospects of the Company, taken as a whole.
4.20 Internal Controls and Records. The Company maintains books of account
-----------------------------
which accurately and validly reflect, in all material respects, all business
transactions of the Company and maintains accounting controls sufficient to
ensure that all such transactions are (a) in all material respects, executed in
accordance with its management's general or specific authorization, and pursuant
to Company's documented policies and procedures, and (b) recorded in conformity
with generally accepted accounting principles. Company has furnished to Gold
all of Company's written internal policies and procedures which are identified
on the Company's Disclosure Schedule.
4.21 Environmental Laws. The operations of Company comply with all
------------------
applicable past and present federal, state and local environmental statutes and
regulations and neither the condition of any property owned by Company nor the
operation of the business of any of such entities violates any applicable
federal, state or local environmental statute or regulation. None of the
operations of Company is subject to any judicial or administrative proceeding
alleging the violation of any federal, state or local environmental health or
safety statute or regulation nor is it the subject of any claim alleging damages
to health or property pursuant to which the Company may be liable. None of the
operations of nor any of the properties owned by Company is the subject of any
federal, state or local investigation in evaluating whether any remedial action
is needed to respond to a release or threatened release of any hazardous waste
or substance from whatever source. No condition or event has occurred which,
with notice or the passage of time or both, would constitute a violation of any
federal, state or local environmental law and at no time has the Company stored
or used any pollutants, contaminants or hazardous or toxic waste, substances or
materials on or at any location owned by Company. There are no underground
storage tanks now or heretofore located on any real property owned by Company .
The Company has not ever been notified by either a federal, state or local
governmental authority, or any private party, that Company is a potentially
responsible party for remedial costs spent addressing the release, or threat of
a release, of a hazardous substance and to the environment pursuant to the
Comprehensive Environmental Response, Compensation or Liability Act, 42 U.S.C.
(S)(S) 9601, et seq. or any corresponding state law.
-------
Gold may obtain at its option and expense on or prior to 120 days following
the date hereof an environmental audit of all properties and assets of Company.
Such environmental
15
audit shall constitute a part of the due diligence process, should Gold choose
to pursue it, and if Gold determines in its sole discretion that such
environmental audit has not been completed to its reasonable satisfaction or
reflects the potential of an environmental problem with respect to any of the
properties or assets of Company, then Gold may deem the due diligence
unsatisfactory and terminate this Agreement under the terms of Section 9.1
hereinafter.
4.22 Broker's Fees. Neither Company nor any of its respective officers or
-------------
directors has employed any broker or finder or incurred any liability for any
broker's fees, commissions or finder's fees in connection with any of the
transactions contemplated by this Agreement.
4.23 Labor Matters. (a) To the best knowledge of Company, Company is in
-------------
compliance with all applicable laws respecting employment and employment
practices, terms and conditions of employment and wages and hours, and is not
engaged in any unfair labor practice; (b) there is no unfair practice complaint
against Company pending before the National Labor Relations Board; (c) there is
no labor strike, dispute, slowdown, representation campaign or work stoppage
actually pending or threatened against or affecting Company; (d) no grievance or
arbitration proceeding arising out of or under collective bargaining agreements
is pending and no claim therefor has been asserted against Company; and (e)
Company is not experiencing any material work stoppage.
4.24 Full Disclosure. No statement contained in any document, certificate,
---------------
or other writing furnished or to be furnished by or at the direction of Company
to Gold in, or pursuant to the provisions of, this Agreement contains or shall
contain any untrue statement of a material fact or omits or shall omit to state
any material fact necessary, in light of the circumstances under which it was
made, in order to make the statements herein or therein not misleading.
ARTICLE V
COVENANTS OF COMPANY
--------------------
5.1 Affirmative Covenants of the Company. Unless the prior written
------------------------------------
consent of Gold shall have been obtained, and which consent will be given or
denied within 3 business days of receipt of written request for such consent,
and except as otherwise expressly contemplated herein, the Company shall (i)
operate its business only in the usual, regular, and ordinary course, (ii)
preserve intact its business organization and assets and maintain its rights and
franchises; and (iii) take no action which would (a) materially adversely affect
the ability of any party to obtain any consents required for the transactions
contemplated hereby without imposition of a condition or restriction which would
prevent the transactions contemplated hereby, including the Merger, from
qualifying as a reorganization within the meaning of Section 368(a) of the Code,
or (b) materially adversely affect the ability of any party to perform its
covenants and agreements under this Agreement.
5.2 Negative Covenants of the Company. Except as specifically permitted
by this Agreement, from the date of this Agreement until the earlier of the
Effective Time or the termination of this Agreement, the Company covenants and
agrees that it will not do or agree to commit to do, any of the following
without the prior written consent of Gold, which consent
16
shall not be unreasonably withheld and which consent will be given or denied
within 3 business days of receipt of written request for such consent:
(a) purchase or invest in any securities, other than U.S. government
obligations or other securities backed by the full faith and credit of the
United States having a maturity of not more than two years from the date of
purchase;
(b) amend or adopt any employee benefit plan, and will not grant any
increase in the rates of pay of their employees or any increase in the
compensation payable or to become payable, if any, to any director, officer,
employee or agent thereof, or contribute to any pension plan or otherwise
increase in any amount the benefits or compensation of any such directors,
officers or employees of Company under any pension plan or other contract or
commitment except for merit increases in accordance with past practices;
(c) make any capital expenditure or enter into any material contract
or commitment involving an obligation or commitment in excess of $15,000 or
engage in any transaction not in their usual and ordinary course of business and
consistent with past practices;
(d) declare or pay any dividend or make any other distribution in
respect of any capital stock of Company, split, combine or reclassify any shares
of its capital stock or, directly or indirectly, redeem, purchase or otherwise
acquire any share of the capital stock of the Company;
(e) amend the Articles of Incorporation or By-Laws of each of the
Company or make any change in the authorized, issued or outstanding capital
stock (or any change in the par value thereof) of Company;
(f) enter into any new line of business;
(g) acquire or agree to acquire, by merging or consolidating with, or
by purchasing a substantial equity interest in or a substantial portion of the
assets of, or by any other manner, any business or any corporation, partnership,
association or other business organization or division thereof or otherwise
acquire any assets, which would be material, individually or in the aggregate,
to Company;
(h) take any action that is intended or may reasonably be expected to
result in any of its representations and warranties set forth in this Agreement
being or becoming untrue in any material respect, or in any of the conditions to
the Merger set forth in Article VII not being satisfied, or in a violation of
any provisions of this Agreement except, in every case, as may be required by
applicable law;
(i) change its methods of accounting except as required by changes in
generally accepted accounting principles ("GAAP") or regulatory accounting
principles as concurred to by the Company's independent auditors;
17
(j) other than activities in the ordinary course of business
consistent with prior practice, sell, lease, encumber, assign or otherwise
dispose of, any of its material assets with a net book value in excess of
$15,000.00, properties or other rights of agreements;
(k) make any equity investment or commitment to make such an
investment in real estate or in any real estate development project;
(l) create, renew, amend or terminate or give notice of a proposed
renewal, amendment or termination of, any material contract, agreement or lease
for goods, services or office space to which the Company is a party or by which
the Company or its respective properties is bound; or
5.3 Inspection. Between the date hereof and the Closing Date and upon
----------
reasonable notice, Gold and its authorized representatives shall be permitted
full access during all business hours to all properties, books, records,
contracts and documents of Company. The Company shall furnish to Gold and its
authorized representative all information with respect to the affairs of Company
as Gold may reasonably request.
5.4 Financial Statements. From and after the date hereof through the
--------------------
Closing Date, Company shall deliver to Gold monthly income statements and
balance sheets of Company.
5.5 Right to Attend Meetings. Company shall allow a representative of
------------------------
Gold to attend as an observer all meetings of the Board of Directors of Company
and all meetings of the committees of such board, including, without limitation,
the audit and executive committees thereof and any other meetings of Company
officials at which policy is being made. Company shall give reasonable notice to
Gold of any such meeting and, if known, the agenda for or business to be
discussed at such meeting. Company shall provide to Gold all information
provided to the directors on the board and all such committees in connection
with all such meetings or otherwise provided to the directors and shall provide
any other financial reports or other analyses prepared for senior management of
Company.
5.6. Data Processing. Company shall cooperate with Gold in taking those
---------------
planning actions necessary to be in a position to convert its data processing
procedures and formats to procedures and formats used by Gold, if any, as of the
Effective Time. Gold shall provide such assistance and consultation as Company
may reasonably require in such planning process.
5.7 No Solicitation. Neither Company nor any affiliates or associates of
---------------
Company acting for or on behalf of Company shall, directly or indirectly, make,
encourage, facilitate, solicit, assist or initiate any inquiry or proposal, or
participate in any negotiations with, or, subject to the provisos to this
sentence, provide any information to, any corporation, partnership, agent,
attorney, financial adviser, person, or other entity or group (other than (a)
Gold, Sub, an affiliate or associate of Gold or Sub or an officer, employee or
other authorized representative of Gold, Sub or such affiliate or associate or
(b) the Company's counsel, accountants and financial adviser solely for use in
connection with the transactions contemplated hereby) relating to any (i)
liquidation, dissolution, recapitalization, merger or consolidation of the
Company, (ii) outside the ordinary course of business, sale of a significant
amount of assets of the Company, (iii) purchase
18
or sale of shares of capital stock of the Company, or (iv) any similar
transactions involving Company, other than the transactions contemplated by this
Agreement; provided, however, that the Company may provide information at the
request of a third party if the Board of Directors of the Company determines, in
good faith, that the exercise of its fiduciary duties to the Company's
shareholders under applicable law, as advised in writing by outside counsel
reasonably acceptable to Gold and Sub, requires it to take such action, and,
provided further, that Company may not, in any event, provide to such third
party any information which it has not provided to Gold and Sub. Company shall
immediately cease and cause to be terminated any and all such contacts and
negotiations with respect to any such transaction. Company shall immediately
inform Gold and Sub of any inquiry, proposal or request for information
(including the terms thereof and the person making such inquiry) which it may
receive in respect of such a transaction.
5.8 Regulatory Approvals. Subject to the terms and conditions of this
--------------------
Agreement, Company agrees to use its reasonable best efforts to cooperate with
Gold in Gold's efforts to secure as expeditiously as practicable all the
necessary approvals, regulatory or otherwise, needed to consummate the
transactions contemplated herein.
5.9 Information. Company shall provide such information and answer such
-----------
inquiries as Gold may reasonably request or make concerning the subject matter
of the representations and warranties of Company herein.
5.10 Tax-Free Reorganization Treatment. Company shall not intentionally
---------------------------------
take or cause to be taken any action, whether before or after the Effective
Time, which would disqualify the Merger as a tax-free "reorganization" within
the meaning of Section 368(a) of the Code (subject to required recognition of
gain or loss with respect to cash paid pursuant hereto or to any holder of
Company Common Stock who dissents from the merger).
ARTICLE VI
COVENANTS OF GOLD AND SUB
-------------------------
6.1 Regulatory Approvals. Subject to the terms and conditions of this
--------------------
Agreement, Gold and Sub agree to use their reasonable best efforts to secure as
expeditiously as practicable all the necessary approvals, regulatory or
otherwise, needed to consummate the transactions contemplated herein and agree
to exercise best efforts to file applications relating to such approvals within
sixty (60) days from the date hereof or as soon thereafter as is reasonably
possible. Gold and Sub shall provide to Company's counsel a copy of all
applications for such approvals and shall keep such counsel or the Company
advised of the status of the regulatory review process.
6.2 Information. Gold and Sub shall provide such information and answer
-----------
such inquiries, as the Company may reasonably request or make concerning the
subject matter of the representations and warranties of Gold and Sub herein.
19
6.3 Tax-Free Reorganization Treatment. Neither Gold nor Sub shall
---------------------------------
intentionally take or cause to be taken any action, whether before or after the
Effective Time, which would disqualify the Merger as a tax-free "reorganization"
within the meaning of Section 368(a) of the Code.
6.4 Issuance of Common Stock. As and when required by the provisions of
------------------------
this Agreement and the Plan of Merger, Gold will issue Gold Common Stock and
cash in the amounts and on the basis set out in this Agreement and the Plan of
Merger to the record holders of shares of Company Common Stock upon the
surrender of properly endorsed certificates.
ARTICLE VII
CONDITIONS PRECEDENT TO GOLD'S OBLIGATIONS
------------------------------------------
The obligations of Gold and Sub to consummate the transactions hereunder
shall be subject to the satisfaction on or before the Closing Date of all of the
following conditions, except such conditions as Gold or Sub may waive in
writing:
7.1 Representations, Warranties and Covenants. All representations and
-----------------------------------------
warranties of Company contained in this Agreement shall be true and correct in
all material respects on and as of the Closing Date, except for changes
permitted by or contemplated by this Agreement and except to the extent that any
such representation or warranty is made solely as of a specified date. Company
shall have performed all agreements and covenants in all material respects
required by this Agreement to be performed on or prior to the Closing Date and
Gold shall have received a certificate signed by the Chief Executive Officer of
Company, dated the Closing Date, to the foregoing effect.
7.2 Material Actions; Debts or Defaults. On the Closing Date, there shall
-----------------------------------
not be: (i) any actions, suits, claims, demands or other proceedings or
investigations, either judicial or administration, pending or, to the knowledge
of Company, threatened against or affecting the properties, assets, rights or
business of Company or the right to carry on or conduct their respective
businesses; (ii) any debt, liability or obligation of Company (whether accrued,
contingent, absolute or otherwise) required to be reflected in a corporate
balance sheet or the notes thereto that is not reflected or reserved against in
their respective financial statements or was not incurred in ordinary course of
its business; or (iii) any material breach or material default of Company under
any agreement or commitment to which either is a party. Further, there shall
not be pending or threatened litigation in any court or any proceeding by any
governmental commission, board or agency which Gold or Sub believes could
reasonably result in restraining, enjoining or prohibiting the consummation of
the transactions contemplated by this Agreement.
7.3 Adverse Changes. There will have been no material adverse change in
---------------
the financial condition of, or in the properties, assets, liabilities, rights or
business, taken as a whole, of Company, and taking into account for this purpose
the proceeds of any applicable insurance.
7.4 Regulatory Authority Approval. Orders, consents and approvals in form
-----------------------------
and substance reasonably satisfactory to Gold shall have been entered by or
obtained from the appropriate regulatory authorities authorizing consummation of
the transactions contemplated hereby and no such order, consent or approval
shall be conditioned or restricted in any manner
20
which in the reasonable judgment of Gold would materially adversely affect the
operations of or be unduly burdensome to Gold. In addition, all required
regulatory approvals to permit the consummation of all other transactions
contemplated hereby, as well as any planned merger transactions with respect
thereto shall have been received and any applicable waiting periods shall have
expired. Company specifically acknowledges and agrees that Sub may assign to any
third party any of its rights hereunder subject to the obligation of Sub to
cause all consideration required under Section 2.2 above to be delivered at the
Effective Time subject to all terms and conditions hereof.
7.5 Litigation. At the Closing Date, there shall not be pending or
----------
threatened litigation in any court or any proceeding by any governmental
commission, board or agency which Gold reasonably believes could reasonably
result in restraining, enjoining or prohibiting the consummation of this
Agreement.
7.6 Approval by Shareholders. The shareholders of the Company shall have
------------------------
duly approved this Agreement and adopted this Agreement and the other
transactions contemplated hereby to the extent required by applicable
requirements of law and the Articles of Incorporation and By-Laws of Company.
7.7 Tax Representations. Each shareholder of Company owning more than 10%
-------------------
of the outstanding Company Common Stock (including shares beneficially owned
through the Company ESOP) shall have made those representations reasonably
requested by counsel and necessary to enable them to render the opinion
described in Section 7.9 hereof.
7.8 Satisfactory Due Diligence. Representatives of Company has
--------------------------
cooperated with Gold, Sub and representatives of Gold and Sub in conducting its
due diligence in accordance with the terms of Section 5.3 above.
7.9 Federal Tax Opinion. Gold shall have received an opinion of Xxxxx &
-------------------
Xxxxx, Chartered, counsel to Gold ("Gold's Counsel"), in form and substance
reasonably satisfactory to Gold, dated the Closing Date, the Merger will be
treated as a tax-free reorganization within the meaning of Section 368(a)(1)(C)
of the Code, subject to required recognition of gain or loss with respect to
cash paid in accordance with the terms hereof or cash paid to holders of Company
Common Stock who dissent from the Merger.
7.10 Opinion of Counsel. Gold shall have received an opinion of Xxxxx X.
------------------
Xxxxx, P.C. ("Company's Counsel"), dated the Closing Date in form and substance
reasonably satisfactory to Gold covering the matters set out in Exhibit 7.10
hereto.
7.11 Qualification for Pooling-of-Interest Treatment. Gold shall have
-----------------------------------------------
received an opinion from an accounting firm reasonably acceptable to Gold that
this transaction will qualify for pooling-of-interest accounting treatment and
that all conditions applicable thereto (including limitation of any cash
consideration paid by Gold hereunder, absence of any capital transactions
involving any parties hereto and any other conditions imposed by such accounting
firm in order to issue such opinion) have been met.
21
7.12 Execution of Employment Agreements. The Company shall have executed
----------------------------------
new employment agreements on terms and conditions reasonably acceptable to Gold
and Sub with Xxxxx X. Xxxxx, Xx., Xxxxxx X. Siemens, Xxxxxxxxx X. Xxxxx and
Xxxxxx X. Xxxxx. Such agreements shall be effective from and after the
Effective Time.
ARTICLE VIII
CONDITIONS PRECEDENT TO OBLIGATION
----------------------------------
OF COMPANY
----------
The obligations of Company to consummate the transactions contemplated
hereunder shall be subject to satisfaction on or before the Closing Date of all
of the following conditions, except such conditions as Company may waive in
writing:
8.1 Representations, Warranties and Covenants. All representations and
-----------------------------------------
warranties of Gold or Sub contained in this Agreement shall be true in all
material respects on and as of the Closing Date, except to the extent that any
such representation or warranty is made solely as of a specified date, and Gold
shall have performed all agreements and covenants in all material respects
required by this Agreement to be performed on or prior to the Closing Date, and
Company shall have received a certificate signed by the chief executive officer
of Gold, dated as of the Closing Date, to the foregoing effect.
8.2 Litigation. There shall not be pending or threatened litigation in
----------
any court or any proceeding by any governmental commission, board or agency
which Company believes could reasonably result in restraining, enjoining or
prohibiting the consummation of the transactions contemplated by this Agreement.
8.3 Adverse Changes. From the date of this Agreement to the Closing Date,
---------------
there will have been no material adverse change in the financial condition,
properties, assets, liabilities, rights, business or prospects of Gold.
8.4 Material Actions; Debts or Defaults. On the Closing Date, there shall
-----------------------------------
not be, except as set forth on the Gold Disclosure Schedule, (i) any actions,
suits, claims, demands or other proceedings or investigations, either judicial
or administrative, pending or, to the knowledge of Gold, threatened against or
affecting the properties, assets, rights or business of Gold or Sub or the right
to carry on or conduct their respective businesses; (ii) any debt, liability or
obligation of Gold or Sub (whether accrued, contingent, absolute or otherwise)
required to be reflected in the corporate balance sheet or the notes thereto
that is not reflected or reserved against in their respective financial
statements or was not incurred in the ordinary course of their respective
businesses; or (ii) any material breach or material default of Gold under any
agreement or commitment to which it is a party.
8.5 Regulatory Authority Approval. All orders, consents and approvals in
-----------------------------
form and substance reasonably satisfactory to Company shall have been entered by
or obtained from the appropriate regulatory authorities authorizing consummation
of the transactions contemplated hereby and no such order, consent or approval
shall be conditioned or restricted in any manner which in the reasonable
judgment of Company would materially adversely affect the operations
22
of or be unduly burdensome to Company. In addition, all required regulatory
approvals to permit the consummation of all other transactions contemplated
hereby shall have been received and applicable waiting periods shall have
expired.
8.6 Federal Tax Opinion. Company and Company's shareholders shall have
-------------------
received the opinion of Gold's Counsel referenced in Section 7.11 hereinabove.
ARTICLE IX
TERMINATION OF AGREEMENT; INDEMNIFICATION
-----------------------------------------
9.1 Basis for Termination. This Agreement and the transactions
---------------------
contemplated hereby may be terminated at any time prior to the Closing Date: (a)
by mutual consent in writing of the parties hereto; (b) by Gold upon written
notice to Company if any regulatory approval of the transactions contemplated
under the terms of this Agreement shall be denied or if any such regulatory
approval shall be conditioned or restricted in any manner which in the
reasonable judgment of Gold would materially adversely affect the operations of
or would be unduly burdensome to Gold; (c) by Gold or Company if the other party
has materially breached this Agreement and has not cured such breach within the
earlier of (i) 30 days after the non-breaching party shall have given notice to
the breaching party of the existence of such breach or (ii) the Closing Date;
(d) by Gold or Company upon written notice to the other of any other condition
imposed for the benefit of such party (including completion of satisfactory due
diligence) that shall not have been satisfied or waived prior to the Closing
Date; or (e) by either Gold or Company if the Closing Date shall not have
occurred by December 31, 1998; provided that the terminating party is not then
in material breach of this Agreement and provided further that such delay has
not been caused by regulatory action or inaction, beyond the control of either
party. As used in this Section 9.1, actions contemplated as being taken by Gold
or the Company must be taken by their respective Board of Directors or the
Executive Committee of such Board.
9.2 Effect of Termination. In the event of termination of this Agreement
---------------------
for any reason set forth in Section 9.1, other than a breach thereof, no party
hereto shall have any liability to the other of any nature whatsoever, including
any liability for loss, damages or expenses suffered or claimed to be suffered
by reason thereof.
In the event Gold and Sub have performed all of their obligations hereunder
and all conditions precedent to the obligation of Gold and Sub to close have
been met or waived in writing by Gold and Sub, but Company fails or otherwise
refuses to close, then Gold shall be entitled to enforce the terms hereof by an
action seeking specific performance. Such right is not exclusive and shall not
preclude Gold from also pursuing an action to recover any and all damages
resulting from the Company's default hereunder. All remedies available to Gold
hereunder or by law are cumulative.
In the event Company has performed all of its obligations hereunder and all
conditions precedent to the obligations of Gold and Sub to close have been met
or waived in writing by Gold and Sub, but Gold and Sub fail or otherwise refuse
to close, then Company shall be entitled to enforce the terms hereof by an
action seeking specific performance. Such right is not exclusive and shall not
preclude Company from also pursuing an action to recover any and all
23
damages resulting from the default by Gold and Sub hereunder. All remedies
available to Company hereunder or by law are cumulative.
9.3 Amendment. This Agreement may be amended by the parties hereto, by
---------
action taken or authorized by their respective Boards of Directors, at any time
before or after approval of the matters presented in connection with the merger
by the stockholders of Company or Sub, but, after any such approval, no
amendment shall be made which by law requires further approval by such
stockholders without such further approval. This Agreement may not be amended
except by an instrument in writing signed on behalf of each of the parties
hereto.
9.4 Extension; Waiver. At any time prior to the Effective Time, the
-----------------
parties hereto, by action taken or authorized by their respective Board of
Directors, may, to the extent legally allowed, (a) extend the time for the
performance of any of the obligations or other acts of the other parties hereto,
(b) waive any inaccuracies in the representations and warranties contained
herein or in any document delivered pursuant hereto and (c) waive compliance
with any of the agreements or conditions contained herein. Any agreement on the
part of a party hereto to any such extension or waiver shall be valid only if
set forth in a written instrument signed on behalf of such party.
9.5 Indemnification by Company and its Shareholders. The Company agrees
-----------------------------------------------
to indemnify and hold harmless Gold, Sub and the officers, shareholders and
directors of each such entity from and against and in respect of any and all
damages, losses, diminution of value, or expenses suffered or incurred by any
such party (whether as a result of third party claims, demands, suits, causes of
action, proceedings, investigations, judgments or liabilities or otherwise),
including costs of investigation in defense and reasonable attorneys' fees
assessed, incurred or sustained by or against any of them, with respect to or
arising out of any breach of the representations, warranties and/or covenants of
the Company set forth herein. If the shareholders approve this transaction,
then the shareholders of the Company shall likewise jointly and severally
indemnify all parties entitled to indemnification herein for all matters for
which indemnification is being provided by the Company under the terms of this
Section 9.5.
9.6 Indemnification by Gold. Gold agrees to indemnify, defend and hold
-----------------------
harmless Company and its shareholders from and against and in respect of any and
all damages, losses, diminution of value, or expenses suffered or incurred by
Company (whether as a result of third party claims, demands, suits, causes of
action, proceedings, investigations, judgments, liabilities or otherwise),
including costs of investigation and defense and reasonable attorneys' fees
assessed or incurred or sustained by or against Company or its shareholders,
with respect to or arising out of any breach of the representations, warranties
and covenants of Gold and Sub set forth herein and in any other agreement or
instrument executed by Gold and/or Sub in connection herewith.
9.7 Limitations on Indemnification. Notwithstanding anything herein
------------------------------
contained to the contrary, no person shall be entitled to indemnification under
the provisions of this Agreement unless such party shall have given written
notice to the indemnifying party setting forth its claim for indemnification in
reasonable detail.
24
ARTICLE X
SECURITIES LAWS MATTERS
-----------------------
10.1 Shares not Registered. Company acknowledges and agrees that the
---------------------
shares of Gold Common Stock being delivered as provided hereinabove have not
been registered under the Securities Act and are therefore "Restricted
Securities" as that term is used in Rule 144 under the Securities Act.
Accordingly, Company and each Shareholder of Company acknowledges and agrees
that such shares may not be sold, transferred or otherwise disposed of unless
they are subsequently registered under the Securities Act or an exemption from
registration is then available. The Company and each Shareholder of the Company
acknowledges and agrees that a legend in substantially the following form will
be placed on the certificate or certificates representing the shares of Gold
Common Stock being delivered pursuant hereto:
The shares represented by this certificate have been acquired for
investment and have not been registered under the Securities Act of
1933. Such shares may not be sold or transferred in the absence of
such registration unless the transfer is in accordance with Rule 144
or a similar rule or unless Gold Banc Corporation, Inc. receives an
opinion of counsel reasonably acceptable to it stating that such sale
or transfer is exempt from the registration and prospectus delivery
requirements of the Securities Act of 1933.
10.2 No Right to Require Registration. Neither the Company nor any
--------------------------------
shareholder of the Company shall have a right to require Gold or Sub to register
any of the shares of Gold Common Stock being delivered hereunder.
ARTICLE XI
MISCELLANEOUS
-------------
11.1 Expenses. Except as set forth herein, each party shall be responsible
--------
for its own expenses in connection with this transaction. Specifically, each
party shall be responsible for its own legal and accounting fees and any related
costs or charges associates with the negotiation, execution and consummation of
this Agreement. It is understood and agreed that the Company may pay its own
legal and accounting fees and related costs or charges associated with the
negotiation, execution and consummation of this Agreement.
11.2 Parties in Interest. This Agreement and the rights hereunder are not
-------------------
assignable unless such assignment is consented to in writing by all parties
hereto. Except as otherwise expressly provided herein, all of the terms and
provisions of this Agreement shall be binding upon, shall inure to the benefit
of and shall be enforceable by the respective heirs, beneficiaries, personal and
legal representatives, successors and permitted assigns of the parties hereto.
11.3 Entire Agreement, Amendments, Waiver. This Agreement contains the
------------------------------------
entire understanding of Gold, Sub and Company with respect to the Merger and
supersedes all prior agreements and understandings, whether written or oral,
between them with respect to the Merger contemplated herein. This Agreement may
be amended only by a written instrument
25
duly executed by the parties or their respective successors or permitted
assigns. Any condition to a party's obligation hereunder may be waived by such
party in writing.
11.4 Notices. All notices, requests, demands or other communications
-------
hereunder shall be in writing and shall be deemed to have been duly given when
personally delivered or transmitted by telefacsimile with a copy thereof
transmitted by a nationally recognized overnight delivery service or deposited
in the United States mail, certified or registered, return receipt requested,
postage prepaid, addressed to the parties at the following addresses or at such
other address as shall be given in like manner by any party to the other:
If to Company: Xx. Xxxxx X. Xxxxx, Xx.
0000 Xxxxxx Xxxx, Xxxxx 000
Xx. Xxxxxx, XX 00000-0000
Telephone: (000) 000-0000
FAX: (000) 000-0000
with a copy to: Xxxxx X. Xxxxx
Xxxxx X. Xxxxx, P.C.
000 Xxxxx 0xx
Xx. Xxxxxx, XX 00000
Telephone: (000) 000-0000
If to Gold: Xx. Xxxxxxx X. Xxxxxxx
Gold Banc Corporation, Inc.
00000 Xxxx Xxxxxx
Xxxxxxx, XX 00000
Telephone: (000) 000-0000
FAX: (000) 000-0000
with a copy to: Xxxxxx X. Xxxxx
Xxxxx & Xxxxx, Chartered
X.X. Xxx 00000
Xxxxxxxx Xxxx, XX 00000
Telephone: (000) 000-0000
FAX: (000) 000-0000
11.5 Law Governing. This Agreement shall be governed by and construed and
-------------
enforced in accordance with the laws of the State of Kansas.
11.6 Further Acts. Gold, Company and Sub agree to execute and deliver on
------------
or before the Closing Date such other documents, certificates, agreements or
other writings and take such other actions as may be necessary or desirable in
order to consummate or implement expeditiously the transactions contemplated by
this Agreement.
26
11.7 Counterparts. This Agreement may be executed simultaneously in two
------------
or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and same instrument.
11.8 Headings. The article and section headings contained herein are for
--------
convenience of reference only, do not constitute a part of this Agreement and
shall not be deemed to limit or affect any of the provisions hereof.
11.9 Severability. If any provisions of this Agreement or the Plan of
------------
Merger, or the application of any such provisions, shall be unenforceable, the
rights and obligations of the parties shall be construed and enforced with that
provision limited so as to make it enforceable to the greatest extent allowed by
law or, if it is totally unenforceable, as if this Agreement and/or the Plan of
Merger did not contain that particular provision.
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as
of the date first above written.
GOLD BANC CORPORATION, INC.
By /s/ Xxxxxxx X. Xxxxxxx
-----------------------
Name: Xxxxxxx X. Xxxxxxx
Title: President and Chief Executive Officer
ATTEST:
/s/ Xxxxx X. Xxxxxxx
------------------------
Name: Xxxxx X. Xxxxxxx
Title: Secretary
GOLD BANC ACQUISITION CORPORATION VIII, INC.
By /s/ Xxxxxxx X. Xxxxxxx
-----------------------
Name: Xxxxxxx X. Xxxxxxx
Title: President and Chief Executive Officer
ATTEST:
/s/ Xxxxx X. Xxxxxxx
------------------------
Name: Xxxxx X. Xxxxxxx
Title: Secretary
27
THE TRUST COMPANY
By /s/ Xxxxx X. Xxxxx, Xx.
------------------------------
Name: Xxxxx X. Xxxxx, Xx.
Title: President
ATTEST:
/s/ Xxxxxxxx X. Xxxxx
-------------------------
Xxxxxxxxx X. Xxxxx
Title: Secretary
28
The undersigned represent all of the Board of Directors of The Trust Company and
hereby evidence their approval of this Agreement and Plan of Reorganization.
/s/ Xxxxx X. Xxxxx, Xx.
---------------------------------
Xxxxx X. Xxxxx, Xx.
/s/ Xxxxxx X. Siemens
---------------------------------
Xxxxxx X. Siemens
/s/ Xxxxxxxxx X. Xxxxx
---------------------------------
Xxxxxxxxx X. Xxxxx
/s/ Xxxxxxx X. English
---------------------------------
Xxxxxxx X. English
/s/ Xxxxx X. Xxxxx
---------------------------------
Xxxxx X. Xxxxx
