AGREEMENT AND PLAN OF REORGANIZATION
AGREEMENT AND PLAN OF REORGANIZATION
("Reorganization Agreement") dated as of November
25, 1996, by and among PEOPLES BANK OF UNITY
("Peoples"), a Pennsylvania banking institution having
its registered office at 0000 Xxxxxxxxx Xxxx,
Xxxxxxxxxx, Xxxxxxxxxxxx 00000-0000, S&T BANCORP, INC.
("S&T"), a Pennsylvania corporation having its principal
executive office at 000 Xxxxxxxxxxxx Xxxxxx, Xxxxxxx,
Xxxxxxxxxxxx 00000-0000 and S&T Bank, a Pennsylvania
banking institution having its registered office at 000
Xxxxxxxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxxxxxxx 00000-0000,
the stock of which is wholly owned by S&T.
WITNESSETH
WHEREAS, the parties hereto desire that Peoples
shall be merged with and into S&T Bank ("Merger")
pursuant to an Agreement and Plan of Merger
substantially in the form attached hereto as Annex A
("Plan of Merger") pursuant to which the shareholders of
Peoples will receive shares of common stock of S&T in
exchange for their shares of common stock of Peoples; and
WHEREAS, the parties hereto desire to provide for
certain undertakings, conditions, representations,
warranties and covenants in connection with the
transactions contemplated hereby.
NOW, THEREFORE, in consideration of the premises
and of the mutual representations, warranties and
covenants herein contained and intending to be legally
bound hereby, the parties hereto do hereby agree as
follows:
ARTICLE 1
DEFINITIONS
1.1. "Bank Holding Company Act" shall mean the
Bank Holding Company Act of 1956, as amended.
1.2. "Closing Date" shall mean the date
specified pursuant to Section 4.9 hereof as the date on
which the parties hereto shall close the transactions
contemplated herein.
1.3. "Code" shall mean the Internal Revenue Code
of 1986, as amended.
1.4. "Commission" or "SEC" shall mean the
Securities and Exchange Commission.
1.5. "Competing Transaction" shall mean any of
the following involving Peoples (other than the
transactions contemplated by this Reorganization
Agreement): (a) any merger, consolidation, share
exchange for a controlling interest, business
combination or other similar transaction; (b) any sale,
lease, exchange, mortgage, pledge, transfer or other
disposition of 15% or more of the assets of Peoples in a
single transaction or series of transactions to the same
person, entity or group or (c) any public announcement
by Peoples of a proposal, plan or intention to do any of
the foregoing or any agreement to engage in any of the
foregoing.
1.6. "Department of Banking" shall mean the
Pennsylvania Department of Banking.
1.7 "Effective Date" shall mean the date
specified pursuant to Section 4.9 hereof as the
effective date of the Merger.
1.8 "ERISA" shall mean the Employee Retirement
Income Security Act of 1974, as amended.
1.9. "Exchange Act" shall mean the Securities
Exchange Act of 1934, as amended.
1.10."FDIA" shall mean the Federal Deposit
Insurance Act.
1.11."FDIC" shall mean the Federal Deposit
Insurance Corporation.
1.12."Federal Reserve Board" shall mean the
Board of Governors of the Federal Reserve System.
1.13."Investment Company Act" means the
Investment Company Act of 1940, as amended.
1.14."Pennsylvania Banking Code" shall mean
the Pennsylvania Banking Code of 1965, as amended.
1.15."Peoples Financial Statements" shall mean
(i) the unaudited balance sheet and income statement of
Peoples as of September 30, 1996 and the audited balance
sheets as of December 31, 1995 and 1994 and the related
statements of cash flows and changes in shareholders'
equity (including related notes, if any) and the income
statements for each of the three years ended
December 31, 1995, 1994 and 1993 and (ii) the balance
sheets of Peoples and related statements of income
(including statements of cash flows and changes in
shareholders' equity and related notes, if any) with
respect to quarterly or annual periods ended subsequent
to September 30, 1996; except that financial statements
as of, or for the nine months ended, September 30, 1996
are contained in a revised Call Report to be filed in
November or December, 1996, and have been prepared in
accordance with generally accepted accounting principles
in all material respects, except that such financial
statements do not contain statements of cash flows or
changes in shareholders' equity or footnotes and are
subject to normal year-end adjustments.
1.16. "Previously Disclosed" shall mean disclosed
prior to the execution hereof in a letter dated of even
date herewith from Peoples and delivered to S&T.
1.17. "Proxy Statement" shall mean the joint
proxy statement/prospectus (or similar documents)
together with any supplements thereto sent to the
shareholders of S&T and Peoples to solicit their votes
in connection with this Reorganization Agreement and the
Plan of Merger.
1.18. "Registration Statement" shall mean the
registration statement with respect to the S&T Common
Stock to be issued in connection with the Merger as
declared effective by the Commission under the
Securities Act.
1.19. "Rights" shall mean warrants, options,
rights, convertible securities and other arrangements or
commitments which obligate an entity to issue or dispose
of any of its capital stock, and stock appreciation
rights, performance units and other similar stock-based
rights whether they obligate the issuer thereof to issue
stock or other securities or to pay cash.
1.20. "SEC Documents" shall mean all reports and
registration statements filed, or required to be filed,
by a party hereto pursuant to the Securities Laws.
1.21. "Securities Act" shall mean the Securities
Act of 1933, as amended.
1.22. "Securities Laws" shall mean: the
Securities Act; the Exchange Act; the Investment Company
Act; the Investment Advisers Act of 1940, as amended;
the Trust Indenture Act of 1939, as amended; and the
rules and regulations of the Commission promulgated
thereunder.
1.23. "S&T Financial Statements" shall mean
(i) the consolidated balance sheets of S&T as of
September 30, 1996 and as of December 31, 1995 and 1994
and the related consolidated statements of income, cash
flows and changes in shareholders' equity (including
related notes, if any) for the nine months ended
September 30, 1996 and each of the three years ended
December 31, 1995, 1994 and 1993 as filed by S&T in SEC
Documents and (ii) the consolidated balance sheets of
S&T and related consolidated statements of income, cash
flows and changes in shareholders' equity (including
related notes, if any) as filed by S&T in SEC Documents
with respect to quarterly or annual periods ended
subsequent to September 30, 1996.
1.24. "Tax" or "Taxes" shall mean all income,
gross receipts, gains, sales, use, employment,
franchise, profits, excise, property, value added,
commercial rent or other taxes, fees, stamp taxes and
duties, assessments or charges of any kind whatsoever
(whether payable directly or by withholding), together
with any interest and penalties, additions to tax or
additional amounts with respect thereto imposed by any
taxing authority.
1.25. "Tax Returns" shall mean all federal,
state, local and foreign tax returns including, without
limitation, estimated tax returns, returns required
under Sections 1441-1446 and 6031-6060 of the Code and
any regulations thereunder, and any comparable state and
local laws and regulations, withholding tax returns,
FICA and FUTA returns and back-up withholding returns
required under Section 3406 of the Code and the
regulations thereunder, and any comparable state and
local laws and regulations.
Other terms used herein are defined in the
preamble and the recitals to this Reorganization
Agreement.
ARTICLE 2.
REPRESENTATIONS AND WARRANTIES OF PEOPLES
Peoples hereby represents and warrants to S&T as
follows:
2.1. Capital Structure of Peoples
The authorized capital stock of Peoples consists
of 115,660 shares of common stock, par value $10.00 per
share ("Peoples Common Stock"), all of which shares are
issued and outstanding. All outstanding shares of
Peoples capital stock have been duly issued and are
validly outstanding, fully paid and nonassessable.
There are no Rights authorized, issued or outstanding
with respect to the capital stock of Peoples. None of
the shares of Peoples capital stock has been issued in
violation of the preemptive rights of any person.
2.2. No Subsidiaries
Peoples does not own, directly or indirectly, 5%
or more of the outstanding capital stock or other voting
securities of any corporation, bank, savings association
or other organization.
2.3. Organization, Standing and Authority of Peoples
Peoples is a duly organized Pennsylvania banking
institution, validly existing and in good standing under
applicable laws. Peoples has full power and authority
to carry on its business as now conducted. Peoples is
not required to be qualified to do business in any other
State of the United States or any foreign jurisdiction.
Peoples has all material federal, state and local
governmental authorizations necessary for it to own or
lease its properties and assets and to carry on its
business as it is now being conducted.
2.4. Authorized and Effective Reorganization Agreement
(a) Peoples has all requisite corporate power
and authority to enter into and perform all of its
obligations under this Reorganization Agreement. The
execution and delivery of this Reorganization Agreement
and the consummation of the transactions contemplated
hereby have been duly and validly authorized by all
necessary corporate action in respect thereof on the
part of Peoples, subject to approval thereof by the
shareholders of Peoples to the extent required by
applicable law and the Articles of Incorporation and
By-Laws of Peoples.
(b) Upon the execution of the Plan of Merger and
at all times thereafter until the Closing Date, Peoples
will have all requisite corporate power and authority to
enter into and perform all of its obligations under the
Plan of Merger, and the execution and delivery of the
Plan of Merger and the consummation of the transactions
contemplated thereby (at the time of such execution)
will have been duly and validly authorized by all
necessary corporate action in respect thereof on the
part of Peoples, except that the affirmative vote of the
holders of two-thirds of the outstanding shares of
Peoples Common Stock is required to approve the Plan of
Merger pursuant to the Pennsylvania Banking Code.
(c) This Reorganization Agreement constitutes a
legal, valid and binding obligation of Peoples and the
Plan of Merger, upon the authorization, execution and
delivery thereof by the parties thereto, will constitute
a legal, valid and binding obligation of Peoples, in
each case enforceable against it in accordance with
their respective terms, subject to receipt of
shareholder approval and, as to enforceability, subject
to bankruptcy, insolvency, fraudulent conveyance and
other laws of general applicability relating to or
affecting creditors' rights and to general equity
principles.
(d) Except as Previously Disclosed, neither the
execution and delivery of this Reorganization Agreement
or the Plan of Merger, nor consummation of the
transactions contemplated hereby or thereby, nor
compliance by Peoples with any of the provisions hereof
or thereof shall (i) conflict with or result in a breach
of any provision of the articles of incorporation or
by-laws of Peoples, (ii) constitute or result in a
breach of any material term, condition or provision of,
or constitute a default under, or give rise to any right
of termination, cancellation or acceleration with
respect to, or result in the creation of any lien,
charge or encumbrance upon any property or asset of
Peoples pursuant to, any material note, bond, mortgage,
indenture, license, agreement or other instrument or
obligation, or (iii) violate any order, writ,
injunction, decree, statute, rule or regulation
applicable to Peoples.
2.5. Financial Statements; Books and Records;
Minute Books
The Peoples Financial Statements fairly present
the financial position of Peoples as of the dates
indicated and the results of operations (and changes in
shareholders' equity and cash flows for audited periods)
of Peoples for the periods then ended in conformity with
generally accepted accounting principles (in all
material respects for unaudited periods) applied on a
consistent basis except as disclosed therein and except
that the Peoples Financial Statements as of, or for the
nine months ended, September 30, 1996 (which were
included in a revised Call Report) and all other interim
financial statements for periods prior to September 30,
1996 were prepared in accordance with generally accepted
accounting principles in all material respects, except
that such financial statements do not contain statements
of cash flows or changes in shareholders' equity or
footnotes and are subject to normal year-end
adjustments. Except as Previously Disclosed, the books
and records of Peoples fairly reflect in all material
respects the transactions to which it is a party or by
which its properties are subject or bound. Except as
Previously Disclosed, such books and records have been
properly kept and maintained and are in compliance in
all material respects with all applicable legal and
accounting requirements. Except as Previously
Disclosed, the minute books of Peoples contain accurate
records of all corporate actions of its shareholders and
Board of Directors (including committees of its Board of
Directors).
2.6. Material Adverse Change
Except as Previously Disclosed, Peoples has not
suffered any material adverse change in its financial
condition, results of operations or business since
December 31, 1995.
2.7. Absence of Undisclosed Liabilities
Peoples has no liability (contingent or
otherwise) that is material to Peoples, or that, when
combined with all similar liabilities, would be material
to Peoples, except as disclosed in the Peoples Financial
Statements as of the date of this Reorganization
Agreement or as Previously Disclosed.
2.8. Properties
Peoples has good and marketable title free and
clear of all liens, encumbrances, charges, defaults or
equitable interests to all of the properties and assets,
real and personal, reflected on the Peoples Financial
Statements as being owned by Peoples as of
December 31, 1995 or acquired after such date, except
(i) liens for taxes not yet due and payable,
(ii) pledges to secure deposits and other liens incurred
in the ordinary course of banking business, (iii) such
imperfections of title, easements and encumbrances, if
any, as are not material in character, amount or extent
and (iv) dispositions and encumbrances for reasonably
adequate consideration in the ordinary course of
business. All leases pursuant to which Peoples, as
lessee, leases real or personal property are valid and
subsisting in accordance with their respective terms.
Peoples has Previously Disclosed a true, complete and
correct list of all personal property owned by officers
or directors of Peoples and located on the premises of
Peoples or used in Peoples' business.
2.9. Loans
Each loan reflected as an asset in the Peoples
Financial Statements as of September 30, 1996, and each
loan entered into subsequent thereto, (i) is evidenced
in all material respects by notes, agreements or other
evidences of indebtedness which are true, genuine and
what they purport to be, (ii) to the extent secured, has
been secured by valid liens and security interests which
have been perfected, and (iii) is the legal, valid and
binding obligation of the obligor named therein,
enforceable in accordance with its terms, subject to
bankruptcy, insolvency, fraudulent conveyance and other
laws of general applicability relating to or affecting
creditors' rights and to general equity principles.
Except as Previously Disclosed, as of September 30,
1996, Peoples is not a party to any loan, including any
loan guaranty, with any director, executive officer or
5% shareholder of Peoples or any person, corporation or
enterprise controlling, controlled by or under common
control with any of the foregoing.
2.10. Allowance for Loan Losses
The allowance for loan losses reflected on the
Peoples Financial Statements, as of their respective
dates, is adequate in all material respects under the
requirements of generally accepted accounting principles
to provide for reasonably anticipated losses on
outstanding loans.
2.11. Tax Matters
(a) Peoples has timely filed all federal income
tax returns required to be filed by it for each year
through December 31, 1995 and has timely filed, or
caused to be filed, all other federal, state, local and
foreign Tax Returns required to be filed with respect to
Peoples.
(b) All Taxes due in respect of any tax periods
have been paid or adequate reserves have been
established for the payment of such Taxes and, as of the
Closing Date, all Taxes due or to become due in respect
of any tax periods ending on or prior to the Closing
Date will have been paid or adequate reserves or
accruals will have been established for the payment
thereof. Peoples will not have any material liability
for any Taxes in excess of the amounts so paid or
reserves or accruals so established. No audit
examination or deficiency or refund litigation is
pending with respect to tax periods of Peoples ending on
or prior to the Closing Date.
(c) All federal, state and local (and, if
applicable, foreign) Tax Returns filed by Peoples are
complete and accurate in all material respects. Peoples
is not delinquent in the payment of any Tax, assessment
or governmental charge, and Peoples has not requested
any extension of time within which to file any Tax
Returns in respect of any taxable year or portion
thereof which have not since been filed. No
deficiencies for any Tax, assessment or governmental
charge have been proposed, asserted or assessed
(tentatively or otherwise) against Peoples which have
not been settled and paid. There are currently no
agreements in effect with respect to Peoples to extend
the period of limitations for the assessment or
collection of any Tax.
(d) Termination of the employment of any
employees of Peoples following consummation of the
transactions contemplated hereby will not cause Peoples
to make or to be required to make any "excess parachute
payment" as that term is defined in Section 280G of the
Code.
2.12. Employee Benefit Plans
(a) Peoples has Previously Disclosed true and
complete copies of all qualified pension or
profit-sharing plans, any deferred compensation,
consulting, bonus or group insurance contract or any
other incentive, welfare or employee benefit plan or
agreement maintained for the benefit of employees or
former employees of Peoples, and will make available to
S&T (i) the most recent actuarial and financial reports
prepared with respect to any plans qualified under
Section 401(a) of the Code, (ii) the most recent annual
reports filed with any government agency and (iii) all
rulings and determination letters and any open requests
for rulings or letters that pertain to any plan
qualified under Section 401(a) of the Code.
(b) Neither Peoples (nor any pension plan
maintained by it) has incurred or reasonably expects to
incur any material liability to the Internal Revenue
Service with respect to any plan qualified under
Section 401(a) of the Code. Except as Previously
Disclosed, Peoples has never sponsored, participated in
or maintained any defined benefit pension plan. Peoples
has never participated in a multiemployer plan as such
term is defined in ERISA.
(c) A favorable determination letter has been
issued by the Internal Revenue Service with respect to
each "employee pension plan" (as defined in Section 3(2)
of ERISA) of Peoples which is intended to be a qualified
plan to the effect that such plan is qualified under
Section 401 of the Code and tax exempt under Section 501
of the Code. No such letter has been revoked or
threatened to be revoked and Peoples does not know of
any ground on which such revocation may be based. Such
plans have been operated in all material respects in
accordance with their terms and applicable law.
(d) No prohibited transaction (which shall mean
any transaction prohibited by Section 406 of ERISA and
not exempt under Section 408 of ERISA) has occurred with
respect to any "employee benefit plan" (as defined in
Section 3(3) of ERISA) maintained by Peoples which would
result in the imposition, directly or indirectly, of an
excise tax under Section 4975 of the Code or the
correction of which would have a material adverse effect
on the financial condition, results of operations or
business of Peoples.
2.13. Certain Contracts
(a) Except as Previously Disclosed, Peoples is
neither a party to, nor is it bound by, (i) any material
agreement, arrangement or commitment whether or not made
in the ordinary course of business (other than loans or
loan commitments made in the ordinary course of the
banking business of Peoples), (ii) any agreement,
indenture or other instrument relating to the borrowing
of money by Peoples or the guarantee by Peoples of any
such obligation, other than instruments relating to
transactions entered into in the customary course of the
banking business of Peoples and reflected in the Peoples
Financial Statements, (iii) any agreement, arrangement
or commitment relating to the employment of a consultant
or the employment, election, retention in office or
severance of any present or former director or officer
or (iv) any contract, agreement or understanding with a
labor union, in each case whether written or oral.
(b) Peoples is not in default under any material
agreement, commitment, arrangement, lease, insurance
policy or other instrument whether entered into in the
ordinary course of business or otherwise and whether
written or oral, and there has not occurred any event
that, with the lapse of time or giving of notice or
both, would constitute such a default.
(c) Since December 31, 1995, Peoples has neither
incurred nor paid any obligation or liability that would
be material to Peoples, except obligations incurred or
paid in connection with transactions in the ordinary
course of business of Peoples consistent with its past
practices or except as Previously Disclosed or reflected
in the Peoples Financial Statements.
(d) Except as Previously Disclosed, Peoples is
not a party to any transaction (other than agreements
Previously Disclosed in connection with Section 2.13(a)
hereof) with (i) any person who has been an executive
officer or a director of Peoples since January 1, 1993,
(ii) any spouse of any such officer or director,
(iii) any parent, child, brother, sister, or other
family relation of any such officer or director who has
the same home as such officer or director, (iv) any
corporation or other entity of which any such officer or
director or any such family relation is an officer,
director, partner, or greater than 5% shareholder (based
on percentage ownership of voting stock) or (v) any
"affiliate" or "associate" of any such persons or
entities (as such terms are defined in the rules and
regulations promulgated under the Securities Act),
including, without limitation, (x) any transaction
involving a contract, agreement, or other arrangement
providing for the employment of, furnishing of
materials, products or services by, rental of real or
personal property from, or otherwise requiring payments
to, any such person or entity, and (y) loans (including
any loan guaranty) outstanding at the date hereof, but
not (z) deposit accounts maintained at Peoples in the
ordinary course of its banking business.
2.14. Legal Proceedings
Except as Previously Disclosed, there are no
actions, suits or proceedings instituted, pending or, to
the knowledge of Peoples, threatened against Peoples or
against any asset, interest or right of Peoples that
would, if determined adversely to Peoples, have a
material adverse effect on Peoples. To the knowledge of
Peoples, there are no actual or threatened actions,
suits or proceedings which present a claim to restrain
or prohibit the transactions contemplated herein or to
impose upon S&T, Peoples or any of their respective
subsidiaries or affiliates any material cost or
obligation in connection therewith. Except as
Previously Disclosed, there are no actions, suits or
proceedings instituted, pending or, to the knowledge of
Peoples, threatened against any present or former
director or executive officer of Peoples that might give
rise to a claim for indemnification that would, if
determined adversely to Peoples, have a material adverse
effect on Peoples, and, to the knowledge of Peoples,
there is no reasonable basis for any such action, suit
or proceeding.
2.15. Compliance with Laws
Except as Previously Disclosed, Peoples is in
compliance in all material respects with all statutes
and regulations applicable to the conduct of its
business, and neither Peoples nor, to the knowledge of
Peoples, any director or officer thereof has received
notification from any agency or department of federal,
state or local government (i) asserting a material
violation of any such statute or regulation,
(ii) threatening to revoke any license, franchise,
permit or government authorization or (iii) restricting
or in any way limiting its operations. Peoples is not
subject to any regulatory or supervisory cease and
desist order, agreement, directive, memorandum of
understanding or commitment, and it has not received any
communication requesting that it enter into any of the
foregoing. Without limiting the generality of the
foregoing, Peoples has timely filed all currency
transaction reports required to be filed and taken all
other actions required under the Currency and Foreign
Transactions Reporting Act, codified at 31 U.S.C. 5301
et seq., and its implementing regulations.
2.16. Brokers and Finders
Neither Peoples nor any of its officers,
directors or employees has employed any broker, finder
or financial advisor or incurred any liability for any
fees or commissions in connection with the transactions
contemplated herein or the Plan of Merger, except that
Peoples has engaged and will pay a fee or commission to
Xxxxxxxxx Associates, Inc.
2.17. Insurance
Peoples has Previously Disclosed a complete and
accurate summary of all insurance policies and bonds
maintained by Peoples. Except as Previously Disclosed,
Peoples has not received any notice of a premium
increase or cancellation with respect to any of its
insurance policies or bonds and, within the last three
years, Peoples has not been refused any insurance
coverage sought or applied for, and Peoples has no
reason to believe that existing insurance coverage
cannot be renewed as and when the same shall expire,
upon terms and conditions as favorable as those
presently in effect, other than possible increases in
premiums or unavailability in coverage that have not
resulted from any extraordinary loss experience of
Peoples.
2.18. Deposit Insurance
Except as Previously Disclosed, Peoples is an
insured bank as defined in the FDIA, and Peoples has
paid all assessments and filed all reports required by
the FDIA.
2.19. Environmental Liability
There is no legal, administrative, arbitral or
other proceeding, or, to the knowledge of Peoples,
claim, action, cause of action, or governmental
investigation of any nature seeking to impose, or that
could result in the imposition, on Peoples of any
liability arising under any local, state or federal
environmental statute, regulation or ordinance
including, without limitation, the Comprehensive
Environmental Response, Compensation and Liability Act
of 1980, as amended, pending or, to the knowledge of
Peoples, threatened against Peoples, which liability
might have a material adverse effect on the financial
condition, results of operations or business of Peoples;
except as Previously Disclosed, to the knowledge of
Peoples, there is no reasonable basis for any such
proceeding, claim, action or governmental investigation
that would impose any such liability; and Peoples is not
subject to any agreement, order, judgment, decree or
memorandum by or with any court, governmental authority,
regulatory agency or third party imposing any such
liability.
2.20. Certain Information
The information contained in the Proxy Statement,
other than information subject to Section 3.9(a) hereof,
at the time the Proxy Statement is mailed to
shareholders of Peoples up to and including the time of
the Peoples shareholders' meeting to vote upon the
Merger, (i) shall comply in all material respects with
the applicable provisions of the regulations of the
Securities Laws and (ii) shall not contain any untrue
statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make
the statements contained therein not misleading.
2.21. Pooling of Interests
As of the date of this Reorganization Agreement,
Peoples, after having consulted with its independent
auditors concerning the requirements of the relevant
accounting literature and SEC pronouncements and
interpretations, does not believe that it has taken any
steps which would preclude S&T from accounting for the
Merger under the pooling of interests method and knows
of no reason relating to it which would reasonably cause
it to believe that the Merger will not qualify as a
pooling of interests for financial accounting
purposes.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF S&T
S&T hereby represents and warrants to Peoples as
follows:
3.1. Capital Structure of S&T
The authorized capital stock of S&T consists at
September 30, 1996 of (i) 10,000,000 shares of preferred
stock, no par value, none of which has been issued and
(ii) 25,000,000 shares of common stock, par value $2.50
per share ("S&T Common Stock"), of which 11,046,355
shares were issued and outstanding and 774,589 shares
were held in treasury. All outstanding shares of S&T
capital stock have been duly issued and are validly
outstanding, fully paid and nonassessable. There are no
Rights authorized, issued or outstanding with respect to
the capital stock of S&T. None of the shares of S&T's
capital stock has been issued in violation of the
preemptive rights of any person. The shares of S&T
Common Stock to be issued in connection with the Merger
have been duly authorized and, when issued in accordance
with the terms of this Reorganization Agreement and the
Plan of Merger, will be validly issued, fully paid,
nonassessable and free and clear of any preemptive
rights. As of September 30, 1996, no shares of S&T
Common Stock were reserved for issuance.
3.2. Organization, Standing and Authority of S&T
Each of S&T and its wholly-owned banking
subsidiary, S&T Bank, is a duly organized corporation,
validly existing and in good standing under the laws of
the Commonwealth of Pennsylvania, with full corporate
power and authority to carry on its business as now
conducted. S&T's wholly-owned nonbanking subsidiary,
S&T Investment Company, Inc., is a duly organized
corporation, validly existing and in good standing under
the laws of the State of Delaware, with full corporate
power and authority to carry on its business as now
conducted. S&T is registered as a bank holding company
under the Bank Holding Company Act.
3.3. Authorized and Effective Reorganization Agreement
(a) Each of S&T and S&T Bank has all requisite
corporate power and authority to enter into and perform
all of its obligations under this Reorganization
Agreement. The execution and delivery of this
Reorganization Agreement and the consummation of the
transactions contemplated hereby and thereby have been
duly and validly authorized by all necessary corporate
action in respect thereof on the part of S&T and S&T
Bank.
(b) Upon the execution of the Plan of Merger and
at all times thereafter until the Closing Date, S&T and
S&T Bank will have all requisite corporate power and
authority to enter into and perform all of its
obligations under the Plan of Merger, and the execution
and delivery of the Plan of Merger and the consummation
of the transactions contemplated thereby (at the time of
such execution) will have been duly and validly
authorized by all necessary corporate action in respect
thereof on the part of S&T and S&T Bank, except that the
affirmative vote of the holders of two-thirds of the
outstanding shares of S&T Common Stock is required to
authorize the issuance of S&T Common Stock pursuant to
this Reorganization Agreement and Plan of Merger in
accordance with Nasdaq requirements.
(c) The Board of Directors of S&T has directed
that this Reorganization Agreement and the Plan of
Merger be submitted to S&T's stockholders for approval
at a special meeting to be held as soon as practicable.
(d) This Reorganization Agreement constitutes a
legal, valid and binding obligation of S&T and S&T Bank
and the Plan of Merger, upon the authorization,
execution and delivery thereof by the parties thereto,
will constitute a legal, valid and binding obligation of
S&T and S&T Bank, enforceable against them in accordance
with their respective terms, subject to receipt of
shareholder approval and, as to enforceability, subject
to bankruptcy, insolvency, fraudulent conveyance and
other laws of general applicability relating to or
affecting creditors' rights and to general equity
principles.
(e) Neither the execution and delivery of this
Reorganization Agreement or the Plan of Merger, nor
consummation of the transactions contemplated hereby or
thereby, nor compliance by S&T or S&T Bank with any of
the provisions hereof or thereof shall (i) conflict with
or result in a breach of any provision of the articles
of incorporation, charter or by-laws of S&T or S&T Bank,
(ii) constitute or result in a breach of any term,
condition or provision of, or constitute a default
under, or give rise to any right of termination,
cancellation or acceleration with respect to, or result
in the creation of any lien, charge or encumbrance upon
any property or asset of S&T or S&T Bank pursuant to,
any note, bond, mortgage, indenture, license, agreement
or other instrument or obligation or (iii) violate any
order, writ, injunction, decree, statute, rule or
regulation applicable to S&T or S&T Bank, except for
such violations, rights, conflicts, breaches, creations
or defaults which, either individually or in the
aggregate would not have a material adverse effect on
S&T.
3.4. SEC Documents; Regulatory Filings
S&T has filed all SEC Documents required by the
Securities Laws and such SEC Documents complied, as of
their respective dates, in all material respects with
the Securities Laws. S&T and each S&T subsidiary has
filed all reports required by statute or regulation to
be filed with any federal or state bank regulatory
agency and such reports were prepared, in all material
respects, in accordance with the applicable statutes,
regulations and instructions in existence as of the date
of filing of such reports.
3.5. Financial Statements; Books and Records;
Minute Books
The S&T Financial Statements fairly present the
consolidated financial position of S&T as of the dates
indicated and the results of operations, changes in
shareholders' equity and cash flows of S&T for the
periods then ended in conformity with generally accepted
accounting principles applied on a consistent basis
except as disclosed therein. The books and records of
S&T fairly reflect in all material respects the
transactions to which it is a party or by which its
properties are subject or bound. Such books and records
have been properly kept and maintained and are in
compliance in all material respects with all applicable
legal and accounting requirements. The minute books of
S&T contain accurate records of all corporate actions of
its shareholders and Board of Directors (including
committees of its Board of Directors).
3.6. Material Adverse Change
S&T has not suffered any material adverse change
in its financial condition, results of operations or
business since December 31, 1995.
3.7. Absence of Undisclosed Liabilities
S&T has no liability (contingent or otherwise)
that is material to S&T, or that, when combined with all
similar liabilities, would be material to S&T, except as
disclosed in the S&T Financial Statements.
3.8. Allowance for Loan Losses
The allowance for loan losses reflected on the
S&T Financial Statements, as of their respective dates,
is adequate in all material respects under the
requirements of generally accepted accounting principles
to provide for reasonably anticipated losses on
outstanding loans.
3.9. Certain Information
(a) The information provided by S&T to Peoples
for use in the Proxy Statement, at the time the Proxy
Statement is mailed to shareholders of Peoples and at
all subsequent times up to and including the time of the
Peoples shareholders' meeting to vote upon the Merger,
shall not contain any untrue statement of a material
fact or omit to state a material fact required to be
stated therein or necessary to make the statements
contained therein, in light of the circumstances under
which they were made, not misleading.
(b) When the Registration Statement or any
post-effective amendment thereto shall become effective,
and at all times subsequent to such effectiveness up to
and including the time of the S&T shareholders' meeting
to vote upon the Merger, such Registration Statement and
all amendments or supplements thereto, with respect to
all information set forth therein furnished by S&T
relating to S&T, (i) shall comply in all material
respects with the applicable provisions of the
Securities Laws, and (ii) shall not contain any untrue
statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make
the statements contained therein not misleading.
3.10. Brokers and Finders
Neither S&T nor any of its officers, directors or
employees, has employed any broker, finder or financial
advisor or incurred any liability for any fees or
commissions in connection with the transactions
contemplated herein or the Plan of Merger, except that
S&T has engaged and will pay a fee or commission to
XxXxxxxx & Company Securities, Inc.
3.11. Compliance with Laws
Each of S&T and its subsidiaries is in compliance
in all material respects with all statutes and
regulations applicable to the conduct of its business,
and none of S&T, its subsidiaries or, to the knowledge
of S&T, any director or executive officer of S&T or any
of its subsidiaries has received notification from any
agency or department of federal, state or local
government (i) asserting a material violation of any
such statute or regulation, (ii) threatening to revoke
any license, franchise, permit or government
authorization or (iii) restricting or in any way
limiting its operations. None of S&T or any subsidiary
of S&T is subject to any regulatory or supervisory cease
and desist order, agreement, directive, memorandum of
understanding or commitment, and none of them has
received any communication requesting that they enter
into any of the foregoing.
3.12. Legal Proceedings
To the knowledge of S&T, there are no actions,
suits or proceedings instituted, pending or, to the
knowledge of S&T, threatened against S&T or against any
asset, interest or right of S&T that would, if
determined adversely to S&T, have a material adverse
effect on S&T. To the knowledge of S&T, there are no
actual or threatened actions, suits or proceedings which
present a claim to restrain or prohibit the transactions
contemplated herein or to impose upon S&T, Peoples or
any of their respective subsidiaries or affiliates any
material cost or obligation in connection therewith.
There are no actions, suits or proceedings instituted,
pending or, to the knowledge of S&T, threatened against
any present or former director or executive officer of
S&T that might give rise to a claim for indemnification
that would, if determined adversely to S&T, have a
material adverse effect on S&T, and, to the knowledge of
S&T, there is no reasonable basis for any such action,
suit or proceeding.
3.13. Pooling of Interests
As of the date of this Reorganization Agreement,
S&T, after having consulted with its independent
auditors concerning the requirements of the relevant
accounting literature and SEC pronouncements and
interpretations, does not believe that it has taken any
steps which would preclude it from accounting for the
Merger under the pooling of interests method and knows
of no reason relating to it which would reasonably cause
it to believe that the Merger will not qualify as a
pooling of interests for financial accounting
purposes.
ARTICLE 4
COVENANTS
4.1. Shareholders' Meetings
S&T and Peoples shall submit this Reorganization
Agreement and the Plan of Merger and, in the case of
S&T, the issuance of S&T Common Stock thereunder, to
their respective shareholders for approval at special
meetings to be held as soon as practicable. Subject to
the fiduciary duties of the respective boards of
directors of S&T and Peoples as determined by each after
consultation with such board's counsel, the boards of
directors of S&T and Peoples shall recommend at the
respective shareholders' meetings that the shareholders
vote in favor of such approval.
4.2. Proxy Statement; Registration Statement
The Board of Directors of Peoples will direct
that this Reorganization Agreement and the Plan of
Merger be submitted to Peoples' shareholders for
approval at a special meeting to be held as soon as
practicable. As promptly as practicable after the date
hereof, S&T and Peoples shall cooperate in the
preparation of the Proxy Statement to be mailed to the
shareholders of S&T and Peoples in connection with the
Merger and the transactions contemplated thereby and to
be filed by S&T as part of the Registration Statement.
S&T will advise Peoples, promptly after it receives
notice thereof, of the time when the Registration
Statement or any post-effective amendment thereto has
become effective or any supplement or amendment has been
filed, of the issuance of any stop order, of the
suspension of qualification of the S&T Common Stock
issuable in connection with the Merger for offering or
sale in any jurisdiction, or the initiation or threat of
any proceeding for any such purpose, or of any request
by the SEC for the amendment or supplement of the
Registration Statement or for additional information.
S&T shall take all actions necessary to register or
qualify the shares of S&T Common Stock to be issued in
the Merger pursuant to all applicable state "blue sky"
or securities laws and shall maintain such registrations
or qualifications in effect for all purposes hereof.
S&T shall apply for approval to have the shares of S&T
Common Stock authorized for trading on the Nasdaq
National Market System prior to the Effective Date.
4.3. Plan of Merger
The terms of the Plan of Merger are incorporated
herein by reference. Peoples shall execute and deliver
the Plan of Merger as soon as practicable following
S&T's request therefor.
4.4. Applications
As promptly as practicable after the date hereof,
S&T shall submit any requisite applications for prior
approval of the transactions contemplated herein and in
the Plan of Merger (i) to the FDIC pursuant to 12 U.S.C.
1828 (c)(2) and (ii) to the Department of Banking
pursuant to Section 1603 of the Pennsylvania Banking
Code, and each of the parties hereto shall submit any
applications, notices or other filings to any other
state or federal government agency, department or body
the approval of which is required for consummation of
the Merger. S&T and Peoples each represents and
warrants to the other that all information concerning it
and its directors, officers and shareholders included
(or submitted for inclusion) in any such application and
furnished by it shall be true, correct and complete in
all material respects.
4.5. Best Efforts; Certain Notices and Information
(a) S&T and Peoples shall each use its best
efforts in good faith to (i) furnish such information as
may be required in connection with the preparation of
the documents referred to in Sections 4.2 and 4.4 above
and (ii) take or cause to be taken all action necessary
or desirable on its part so as to permit consummation of
the Merger at the earliest possible date, including,
without limitation, (1) obtaining the consent or
approval of each individual, partnership, corporation,
association or other business or professional entity
whose consent or approval is required for consummation
of the transactions contemplated hereby, provided that
Peoples shall not agree to make any payments or
modifications to agreements in connection therewith
without the prior written consent of S&T, except where
such payment or modification would not have a material
adverse effect on Peoples, and (2) requesting the
delivery of appropriate opinions, consents and letters
from its counsel and independent auditors. No party
hereto shall take or fail to take, or to the best of its
ability permit to be taken or omitted to be taken by any
third persons, any action that would substantially
impair the prospects of completing the Merger pursuant
to this Reorganization Agreement and the Plan of Merger,
that would materially delay such completion, or that
would adversely affect the qualification of the Merger
for pooling of interests accounting treatment or as a
reorganization within the meaning of Section 368(a) of
the Code.
(b) Peoples shall give prompt notice to S&T, and
S&T shall give prompt notice to Peoples, of (i) the
occurrence, or failure to occur, of any event which
occurrence or failure would be likely to cause any
representation or warranty contained in this
Reorganization Agreement to be untrue or inaccurate in
any material respect at any time from the date hereof to
the Closing Date and (ii) any material failure of S&T or
Peoples, as the case may be, to comply with or satisfy
any covenant, condition or agreement to be complied with
or satisfied by it hereunder, and each party shall use
all reasonable efforts to remedy such failure.
(c) Each party shall provide and shall request
its auditors to provide the other party with such
historical financial information regarding it (and
related audit reports and consents) as the other party
may reasonably request for securities disclosure
purposes.
4.6. Investigation and Confidentiality
Peoples and S&T will each keep the other advised
of all material developments relevant to its business
and to the consummation of the transactions contemplated
herein. Peoples and S&T may make or cause to be made
such investigation of the financial and legal
condition of the other as such party reasonably deems
necessary or advisable in connection with the
transactions contemplated herein and in the Plan of
Merger, provided, however, that such investigation shall
be reasonably related to such transactions and shall not
interfere unnecessarily with normal operations. Peoples
and S&T agree to furnish the other and the other's
advisors with such financial data and other information
with respect to its business and properties as such
other party shall from time to time reasonably request.
No investigation pursuant to this Section 4.6 shall
affect or be deemed to modify any representation or
warranty made by, or the
conditions to the obligations to consummate the Merger
of, any party hereto. Each party shall, and shall cause
its directors, officers, attorneys and advisors to,
maintain the confidentiality of all information obtained
in such investigation which is not otherwise publicly
disclosed by the other party, said undertaking with
respect to confidentiality to survive any termination of
this Agreement pursuant to Section 6.1 hereof. In the
event of termination of this Reorganization Agreement,
each party shall return to the furnishing party or
destroy and certify the destruction of all information
previously furnished in connection with the transactions
contemplated by this Reorganization Agreement.
4.7. Press Releases
Peoples and S&T shall agree with each other as to
the form and substance of any press release related to
this Reorganization Agreement and the Plan of Merger or
the transactions contemplated hereby or thereby, and
shall consult each other as to the form and substance of
other public disclosures related thereto, provided,
however, that nothing contained herein shall prohibit
either party, following notification to the other party,
from making any disclosure which its counsel deems
necessary.
4.8. Covenants of Peoples
(a) Prior to the Closing Date, and except as
otherwise provided for by this Reorganization Agreement,
the Plan of Merger or consented to or approved by S&T,
Peoples shall use its reasonable efforts to preserve its
properties, business and relationships with customers,
employees and other persons.
(b) Except with the prior written consent of
S&T, between the date hereof and the Effective Date,
Peoples shall not:
(1) carry on its business other than in the
usual, regular and ordinary course in substantially the
same manner as heretofore conducted;
(2) declare, set aside, make or pay any
dividend or other distribution in respect of its capital
stock, except that Peoples may, in order to conform to
the S&T dividend policy subsequent to the execution of
this Reorganization Agreement, (i) declare a dividend in
December 1996 with a record date of January 2, 1997 and
payable in January 1997 in an amount equal to the dollar
amount of the per share dividend in respect of the
fourth quarter of 1996 that S&T declares in December
1996, payable to S&T shareholders in January 1997,
multiplied by the number of the shares of S&T Common
Stock to be received by shareholders of Peoples pursuant
to the Merger ("Exchange Ratio"); (ii) if the Effective
Date shall not have occurred prior to April 1, 1997,
declare a dividend on or after April 1, 1997, payable in
April 1997 in an amount equal to the dollar amount of
the per share dividend in respect of the first quarter
of 1997 that S&T declares in March 1997, payable to S&T
shareholders in April 1997, multiplied by the Exchange
Ratio; and (iii) if the Effective Date shall not have
occurred prior to July 1, 1997, declare a dividend on or
after July 1, 1997, payable in July 1997 in an amount
equal to the dollar amount of the per share dividend in
respect of the second quarter of 1997 that S&T declares
in June 1997, payable to S&T shareholders in July 1997,
multiplied by the Exchange Ratio;
(3) issue any shares of its capital stock
or permit any treasury shares to become outstanding,
incur any additional debt obligation or other obligation
for borrowed money, other than in the ordinary course of
business of Peoples consistent with past practice;
(4) issue, grant or authorize any Rights or
effect any recapitalization, reclassification, stock
dividend, stock split or like change in capitalization;
(5) amend its charter or by-laws;
(6) merge with any other corporation,
savings association or bank or permit any other
corporation, savings association or bank to merge into
it or consolidate with any other corporation, savings
association or bank; acquire control over any other
firm, bank, corporation, savings association or
organization; or create any subsidiary;
(7) fail to comply in any material respect
with any material laws, regulations, ordinances or
governmental actions applicable to it and to the conduct
of its business; enter into any material swap, hedge or
other similar off-balance sheet transaction; waive or
release any material right or cancel or compromise any
material debt or claim; restructure, extend or modify
any loan Previously Disclosed pursuant to the second
sentence of Section 2.9 hereof or that would have been
required to have been so disclosed if it had been
outstanding at September 30, 1996, waive or release any
right or cancel or compromise any debt or claim in
connection with any such loan, or make any new loan that
would have been required to have been so disclosed if it
had been outstanding at September 30, 1996;
(8) liquidate or sell or dispose of any
material assets or acquire any material assets; make any
capital expenditures in excess of $25,000 in the
aggregate; or establish new branches or other similar
facilities; or enter into or modify any leases or other
contracts that involve annual payments by Peoples that
exceed $10,000 in any instance or $25,000 in the
aggregate;
(9) increase the rate of compensation of,
pay or agree to pay any bonus to, or provide any other
employee benefit or incentive to, any of its directors,
officers or employees except in accordance with Peoples'
standard compensation and benefits practices; enter
into, modify or extend any employment or severance
contracts with any of its present or former directors,
officers or employees; or enter into or substantially
modify (except as may be required by applicable law) any
pension, retirement, stock option, stock purchase, stock
appreciation right, savings, profit sharing, deferred
compensation, consulting, bonus, group insurance or
other employee benefit, incentive or welfare contract,
plan or arrangement, or any trust agreement related
thereto, in respect of any of its directors, officers or
other employees;
(10) change its lending, investment,
asset/liability management or other material banking
policies in any material respect except as may be
required by changes in applicable law, regulation or
regulatory directives;
(11) change its methods of accounting in
effect at December 31, 1995, except as required by
changes in generally accepted accounting principles
concurred in by its independent certified public
accountants (including but not limited to the adoption
of Statement of Financial Accounting Standard 107), or
change any of its methods of reporting income and
deductions for federal income tax purposes from those
employed in the preparation of its federal income tax
returns for the year ended December 31, 1995, except as
required by changes in law or applicable regulations;
(12) solicit, encourage or initiate
inquiries or proposals with respect to any acquisition
or purchase of all or a substantial portion of the
assets of, or a substantial equity interest in, Peoples
or any business combination with Peoples, or, subject to
the fiduciary duties of its directors as advised by
counsel, furnish any information relating to or in
connection with any such inquiries or proposals, other
than as contemplated by this Reorganization Agreement;
or authorize or permit any officer, director, agent or
affiliate of it to do any of the above; or fail to
notify S&T immediately if any such inquiries or
proposals are received by, any such information is
required from, or any such negotiations or discussions
are sought to be initiated with Peoples; or
(13) agree to do any of the foregoing.
(c)As soon as practicable, Peoples shall cause
(i) financial statements to be prepared in conformity
with generally accepted accounting principles for
whatever full fiscal year periods are necessary to
comply with the requirements of Form S-4 under the
Securities Act, with respect to this transaction, and
with the other requirements of the rules and regulations
under the Securities Act and the Exchange Act as may be
applicable to S&T, (ii) its independent public
accountants to perform an audit of such financial
statements in conformity with generally accepted
auditing standards, and (iii) its independent public
accountants to consent to the use of their opinion with
respect to such financial statement in registration
statements filed by S&T under the Securities Act.
4.9. Closing; Articles of Merger
The transactions contemplated by this
Reorganization Agreement and the Plan of Merger shall be
consummated at a closing to be held at such location as
the parties may agree, on the first business day
following satisfaction of the conditions to consummation
of the Merger set forth in Article 5 hereof or such
later date within 30 days thereafter as reasonably may
be specified by S&T, with the Merger to be consummated
after such intermediate steps as S&T reasonably may
specify. The Merger shall be effective at the time and
date specified in the Articles of Merger.
4.10. Peoples Employees; Board of Directors;
Indemnification
(a) All employees of Peoples as of the Effective
Date shall become employees of S&T or a subsidiary of
S&T. Nothing in this Reorganization Agreement shall
give any employee of Peoples a right to continuing
employment with S&T after the Effective Date. As soon
as practicable after the Effective Date, S&T shall
provide or cause to be provided to all employees of
Peoples who remain employed by S&T benefits which in the
aggregate are no less favorable than those generally
afforded to other S&T employees holding similar
positions, provided that for purposes of determining
eligibility for and vesting of such employee benefits,
service with Peoples prior to the Effective Date shall
be treated as service to the same extent as if such
persons had been employees of S&T or affiliates of S&T,
and provided further that this Section 4.10(a) shall not
be construed (i) to limit the ability of S&T and its
affiliates to terminate the employment of any employee
or to review employee benefits programs from time to
time and to make such changes as they deem appropriate
or (ii) to require S&T or its affiliates to provide
employees or former employees with post-retirement
medical benefits.
(b) S&T shall take all requisite action
immediately prior to the Effective Date to elect as
members of its board of directors three persons selected
by Peoples to serve as directors of S&T.
(c) From and after the Effective Date for a
period of three years, S&T shall indemnify persons who
serve as directors and officers of Peoples as of the
date of this Reorganization Agreement for claims arising
prior to the Effective Date as provided under S&T's
By-Laws as delivered to Peoples prior to the execution
of this Reorganization Agreement, as if such persons had
been entitled to indemnification under such S&T By-Laws
prior to the Effective Date.
4.11. Affiliates
(a) S&T and Peoples shall cooperate and use
their best efforts to identify those persons who may be
deemed to be "affiliates" of Peoples and S&T within the
meaning of Rule 145 promulgated by the Commission under
the Securities Act and for purposes of qualifying the
"Merger" for "pooling interests" accounting treatment.
Peoples shall use its best efforts to cause each Peoples
affiliate so identified to deliver to S&T no later than
30 days prior to the Effective Date, a written agreement
providing that such person will not dispose of S&T
Common Stock received in the Merger except in compliance
with the Securities Act, the rules and regulations
promulgated thereunder and the Commission's rules
relating to the pooling of interests accounting
treatment.
(b) S&T shall use its best efforts to publish no
later than 90 days after the end of the first month
after the Effective Date in which there are at least 30
days of post-Merger combined operations (which month
may be the month in which the Effective Date occurs),
combined sales and net income figures as contemplated
by and in accordance with the terms of SEC Accounting
Series Release No. 135.
4.12. Nasdaq Application
S&T shall apply to have the shares of S&T Common
Stock that may be issued in the Merger authorized for
trading on the Nasdaq National Market System.
ARTICLE 5
CONDITIONS PRECEDENT
5.1. Conditions Precedent - S&T and Peoples
The respective obligations of Peoples, S&T, or
S&T Bank to effect the Merger, shall be subject to
satisfaction or waiver of the following conditions at or
prior to the Closing Date:
(a) All corporate action necessary to authorize
the execution, delivery and performance of this
Reorganization Agreement and the Plan of Merger and
consummation of the transactions contemplated hereby and
thereby shall have been duly and validly taken,
including without limitation the approvals of the
shareholders of Peoples and S&T in accordance with
applicable law;
(b) The parties hereto shall have received all
regulatory approvals required or deemed necessary in
connection with the transactions contemplated by this
Reorganization Agreement and the Plan of Merger, all
notice periods and waiting periods required after the
granting of any such approvals shall have passed and all
conditions contained in any such approval required to
have been satisfied prior to consummation of such
transactions shall have been satisfied, provided,
however, that no such approval shall have imposed any
condition or requirement which, in the reasonable
opinion of the Board of Directors of S&T materially and
adversely affects the anticipated economic and business
benefits to S&T of the transactions contemplated by this
Reorganization Agreement taken as a whole;
(c) The Registration Statement (including any
post-effective amendment thereto) shall be effective
under the Securities Act, and no proceeding shall be
pending or to the knowledge of S&T threatened by the
Commission to suspend the effectiveness of such
Registration Statement, and S&T shall have received all
state securities or "blue sky" permits or other
authorizations, or confirmations as to the availability
of an exemption from registration requirements as may be
necessary;
(d) None of the parties hereto or to the Plan of
Merger shall be subject to any order, decree or
injunction of a court or agency of competent
jurisdiction which enjoins or prohibits the consummation
of the transactions contemplated by this Reorganization
Agreement and the Plan of Merger;
(e) The shares of S&T Common Stock that may be
issued in the Merger shall have been authorized for
trading on the Nasdaq National Market System; and
(f) S&T and Peoples shall have received an
opinion of Xxxxxx & Xxxxxx substantially to the effect
that, on the basis of facts, representations and
assumptions set forth in such opinion, (i) the Merger
will constitute a reorganization within the meaning of
Section 368(a) of the Code and (ii) no gain or loss will
be recognized by a shareholder of Peoples who exchanges
all of the shareholder's Peoples Common Stock solely for
S&T Common Stock in the Merger (except with respect to
cash received in lieu of a fractional share interest in
S&T Common Stock).
5.2. Conditions Precedent - Peoples
The obligations of Peoples to effect the Merger
shall be subject to satisfaction of the following
additional conditions at or prior to the Closing Date
unless waived by Peoples pursuant to Section 6.4 hereof:
(a) The representations and warranties of S&T
set forth in Article 3 hereof shall be true and correct
in all material respects as of the date of this
Reorganization Agreement and as of the Closing Date as
though made on and as of the Closing Date (or on the
date when made in the case of any representation and
warranty which specifically relates to an earlier date),
except (i) as otherwise contemplated by this
Reorganization Agreement or consented to in writing by
Peoples and (ii) insofar as the failure of any
representation and warranty to be true and correct does
not have, and is not reasonably likely to have, a
material adverse effect on S&T;
(b) S&T and S&T Bank shall have in all material
respects performed all obligations and complied with all
covenants required by this Reorganization Agreement and
the Plan of Merger;
(c) S&T and S&T Bank each shall have delivered
to Peoples a certificate, dated the Closing Date and
signed by its Chairman and Chief Executive Officer or
Executive Vice President to the effect that the
conditions set forth in paragraphs (a) and (b) of this
section have been satisfied;
(d) The shares of S&T Common Stock to be
received by the shareholders of Peoples pursuant to the
Merger shall be freely tradeable by the recipients
thereof, subject to restrictions upon resale imposed by
virtue of Rule 145 under the Securities Act and the
Commission's rules relating to the pooling of interests
accounting treatment, as agreed to in the written
agreements provided pursuant to Section 4.11(a) hereof;
(e) Peoples shall have received an opinion of
Xxxxxx & Xxxxxx, counsel to S&T, dated the Closing Date,
as to such matters as Peoples may reasonably request
with respect to the transactions contemplated hereby and
by the Plan of Merger; and
(f) Peoples shall have received an opinion from
Xxxxxxxxx Associates Inc. dated the date of the Proxy
Statement that the consideration to be received by the
shareholders of Peoples pursuant to this Reorganization
Agreement is fair from a financial point of view to the
shareholders of Peoples.
5.3. Conditions Precedent - S&T
The obligations of S&T and S&T Bank to effect the
Merger shall be subject to satisfaction of the following
additional conditions at or prior to the Closing Date
unless waived by S&T pursuant to Section 6.4 hereof:
(a) The representations and warranties of
Peoples set forth in Article 2 hereof shall be true and
correct in all material respects as of the date of this
Reorganization Agreement and as of the Closing Date as
though made on and as of the Closing Date (or on the
date when made in the case of any representation and
warranty which specifically relates to an earlier date),
except (i) as otherwise contemplated by this
Reorganization Agreement or consented to in writing by
S&T and (ii) insofar as the failure of any
representation and warranty to be true and correct does
not have, and is not reasonably likely to have, a
material adverse effect on Peoples.
(b) Peoples shall have in all material respects
performed all obligations and complied with all
covenants required by this Reorganization Agreement and
the Plan of Merger;
(c) Peoples shall have delivered to S&T a
certificate, dated the Closing Date and signed by its
Chairman or its Acting Chief Executive Officer or other
appropriate officer to the effect that the conditions
set forth in paragraphs (a) and (b) of this section have
been satisfied;
(d) S&T shall have received an opinion or
opinions of Xxxxxxxxxxx & Xxxxxxxx LLP, counsel to
Peoples, dated the Closing Date, as to such matters as
S&T may reasonably request with respect to the
transactions contemplated hereby and by the Plan of
Merger;
(e) S&T shall have received an opinion letter,
dated as of the Closing Date, from Ernst & Young LLP,
its independent public accountants, to the effect that
the Merger will qualify for pooling of interests
accounting treatment under Accounting Principles Board
Opinion No. 16 if closed and consummated in accordance
with this Reorganization Agreement; except that this
condition shall be deemed to have been waived by S&T to
the extent that it takes any action or causes any
conditions to occur, without the written consent of
Peoples, which constitute the sole reason for Ernst &
Young LLP being unable to render such opinion; and
(f) S&T shall have received a "comfort" letter
from S.R. Xxxxxxxxx, X.X. dated not more than five days
prior to (i) the effective date of the Registration
Statement and (ii) the Closing Date, with respect to
certain financial information regarding Peoples, in form
and in substance which is customary in transactions of
the nature contemplated by this Reorganization Agreement.
ARTICLE 6
TERMINATION, WAIVER AND AMENDMENT
6.1. Termination
This Reorganization Agreement and the Plan of
Merger may be terminated, either before or after
approval by the shareholders of Peoples:
(a) At any time on or prior to the Effective
Date, by the mutual consent in writing of the parties
hereto;
(b) At any time on or prior to the Closing Date,
by S&T in writing, if Peoples has, or by Peoples in
writing, if S&T has, in any material respect, breached
(i) any covenant or agreement contained herein or in the
Plan of Merger or (ii) any representation or warranty
contained herein if the failure of any such
representation and warranty to be true and correct has,
or is reasonably likely to have, a material adverse
effect upon S&T or Peoples, and in either case if such
breach has not been cured by the earlier of 30 days
after the date on which written notice of such breach is
given to the party committing such breach or the Closing
Date;
(c) On the Closing Date, by either party hereto
in writing, if any of the conditions precedent set forth
in Article 5 hereof with respect to such party have not
been satisfied or fulfilled;
(d) At any time, by either party hereto in
writing, if the applications for prior approval referred
to in Section 4.4 hereof have been denied, and the time
period for appeals and requests for reconsideration has
run;
(e) At any time, by either party hereto in
writing, if the shareholders of S&T or Peoples do not
approve the transactions contemplated herein at the
annual or special meetings duly called for that purpose;
(f) At any time, by either party in writing, if
such party determines in good faith that any condition
precedent to such party's obligations to consummate the
Merger is or would be impossible to satisfy, provided
that the terminating party has given the other party
written notice with respect thereto at least 10 days
prior to such termination and has given the other party
a reasonable opportunity to discuss the matter with a
view to achieving a mutually acceptable resolution; or
(g) By either party hereto in writing, if the
Closing Date has not occurred by the close of business
on September 30, 1997.
6.2. Effect of Termination
In the event this Reorganization Agreement or the
Plan of Merger is terminated pursuant to Section 6.1
hereof, this Reorganization Agreement and the Plan of
Merger shall become void and have no effect, except that
(i) the provisions relating to confidentiality and
expenses set forth in Sections 4.6 and 7.1 hereof,
respectively, shall survive any such termination and
(ii) a termination pursuant to Section 6.1(b)(i) shall
not relieve the breaching party from liability for an
uncured willful breach of a covenant or agreement giving
rise to such termination.
6.3. Survival of Representations, Warranties
and Covenants
All representations, warranties and covenants in
this Reorganization Agreement and the Plan of Merger or
in any instrument delivered pursuant hereto or thereto
shall expire on, and be terminated and extinguished at,
the Effective Date other than covenants that by their
terms are to survive or be performed after the Effective
Date, provided that no such representations, warranties
or covenants shall be deemed to be terminated or
extinguished so as to deprive S&T or Peoples (or any
director, officer or controlling person thereof) of any
defense in law or equity which otherwise would be
available against the claims of any person, including,
without limitation, any shareholder or former
shareholder of either S&T or Peoples, the aforesaid
representations, warranties and covenants being material
inducements to the consummation by S&T, S&T Bank and
Peoples of the transactions contemplated herein.
6.4. Waiver
Except with respect to any required shareholder
or regulatory approval, S&T and Peoples, respectively,
by written instrument signed by an executive officer of
such party, may at any time (whether before or after
approval of this Reorganization Agreement and the Plan
of Merger by the shareholders of S&T and Peoples) extend
the time for the performance of any of the obligations
or other acts of Peoples, on the one hand, or S&T or S&T
Bank, on the other hand, and may waive (i) any
inaccuracies of such parties in the representations or
warranties contained in this Reorganization Agreement,
the Plan of Merger or any document delivered pursuant
hereto or thereto, (ii) compliance with any of the
covenants, undertakings or agreements of such parties,
or satisfaction of any of the conditions precedent to
its obligations, contained herein or in the Plan of
Merger or (iii) the performance by such parties of any
of its obligations set out herein or therein; provided,
however, that no such waiver executed after approval of
this Reorganization Agreement and the Plan of Merger by
the shareholders of S&T or Peoples shall change the
number of shares of S&T Common Stock into which each
share of Peoples Common Stock shall be converted
pursuant to the Merger.
6.5. Amendment or Supplement
This Reorganization Agreement and the Plan of
Merger may be amended or supplemented at any time by
mutual agreement of the parties hereto, in the case of
this Reorganization Agreement, or thereto, in the case
of the Plan of Merger. Any such amendment or supplement
must be in writing and approved by their respective
boards of directors and/or officers authorized thereby
and shall be subject to the proviso in Section 6.4
hereof.
ARTICLE 7
MISCELLANEOUS
7.1. Expenses
(a) Each party hereto shall bear and pay all
costs and expenses incurred by it in connection with the
transactions contemplated in this Reorganization
Agreement, including fees and expenses of its own
financial consultants, accountants and counsel, except
that S&T shall bear and pay all costs and expenses
incurred in connection with printing the Registration
Statement and joint Proxy Statement and prospectus of
S&T and Peoples.
(b) Peoples and S&T each acknowledge that the
other has spent, and will be required to spend,
substantial time and effort in examining the business,
properties, affairs, financial condition and prospects
of the other, has incurred, and will continue to incur,
substantial fees and expenses in connection with such
examination, the preparation of this Reorganization
Agreement and the accomplishment of the transactions
contemplated hereby, and will be unable to evaluate and,
possibly, make investments in or acquire other entities
due to the limited number of personnel available for
such purpose and the constraints of time. Therefore, to
induce S&T to enter into this Reorganization Agreement,
(i) if S&T terminates this Reorganization Agreement
pursuant to Section 6.1(b) or (c) by reason of Peoples'
failure to meet any condition contained in
Section 5.3(a) or (b) due to Peoples' knowing and
intentional misrepresentation or knowing and intentional
breach of warranty or breach of any covenant or
agreement, and within 9 months from the date of
termination a Competing Transaction is consummated or
Peoples shall have entered into an agreement or an
agreement in principle which if consummated would
constitute a Competing Transaction or (ii) if Peoples
terminates this Reorganization Agreement pursuant to
Section 6.1(b) or (c) because this Reorganization
Agreement did not receive the requisite vote of Peoples
stockholders and within 9 months from the date of
termination (other than a termination pursuant to
Article IX of the Plan of Merger) a Competing
Transaction is consummated or Peoples shall have entered
into an agreement which if consummated would constitute
a Competing Transaction, then Peoples shall pay to S&T a
fee in the amount of $1,600,000, not as a penalty but as
full and complete liquidated damages. Upon payment of
such fee, Peoples shall have no further liability to S&T
at law or equity. The fee shall be payable to S&T
notwithstanding that any action taken by the Board of
Directors of Peoples which may give rise to the
obligation to pay the fee may have been taken in
accordance with the fiduciary duties of the Board of
Directors. Any payment required pursuant to this
Section 7.1(b) shall be made as promptly as practicable,
but in no event later than two business days after the
date it becomes payable hereunder and shall be made by
wire transfer of immediately available funds to an
account designated by S&T. In the event that S&T is
entitled to the fee, Peoples shall also pay S&T interest
at the rate of 6% per year on any amounts that are not
paid when due, plus all costs and expenses in connection
with or arising out of the enforcement of the obligation
of Peoples to pay the fee or such interest.
7.2. Entire Agreement
This Reorganization Agreement and the Plan of
Merger contain the entire agreement between the parties
with respect to the transactions contemplated hereunder
and thereunder and supersede all prior arrangements or
understandings with respect thereto, written or oral,
other than documents referred to herein or therein. The
terms and conditions of this Reorganization Agreement
and the Plan of Merger shall inure to the benefit of and
be binding upon the parties hereto and thereto and their
respective successors. Nothing in this Reorganization
Agreement or the Plan of Merger, expressed or implied,
is intended to confer upon any party, other than the
parties hereto and thereto, and their respective
successors, any rights, remedies, obligations or
liabilities.
7.3. No Assignment
No party hereto may assign any of its rights or
obligations under this Reorganization Agreement to any
other person.
7.4. Notices
All notices or other communications which are
required or permitted hereunder shall be in writing and
sufficient if delivered personally or sent by facsimile
transmission or overnight express or by registered or
certified mail, postage prepaid, addressed as follows:
If to Peoples:
Peoples Bank of Unity
0000 Xxxxxxxxx Xxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000-0000
Attention: Xxxxxxx X. Xxxxxx
Facsimile No.: (000) 000-0000
With a required copy to:
Xxxxxxxxxxx & Xxxxxxxx LLP
0000 Xxxxxx Xxxxxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000-0000
Attention: J. Xxxxxx Xxx Xxxx
Facsimile No.: (000) 000-0000
If to S&T or S&T Bank:
S&T Bancorp, Inc.
000 Xxxxxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxxxxx 00000-0000
Attention: Xxxxxx X. Xxxxxx
Facsimile No.: (000) 000-0000
With a required copy to:
Xxxxxx & Xxxxxx
000 00xx Xxxxxx, X.X.
Xxxxxxxxxx, X.X. 00000-0000
Attention: Xxxxxxxxx X. XxXxx
Facsimile No.: (000) 000-0000
7.5. Captions
The captions contained in this Reorganization
Agreement are for reference purposes only and are not
part of this Reorganization Agreement.
7.6. Counterparts
This Reorganization Agreement may be executed in
any number of counterparts, and each such counterpart
shall be deemed to be an original instrument, but all
such counterparts together shall constitute but one
agreement.
7.7. Governing Law
This Reorganization Agreement shall be governed
by and construed in accordance with the laws of the
Commonwealth of Pennsylvania applicable to agreements
made and entirely to be performed within such
jurisdiction, except to the extent federal law may be
applicable.
IN WITNESS WHEREOF, the parties hereto, intending
to be legally bound hereby, have caused this
Reorganization Agreement to be executed in counterparts
by their duly authorized officers and their corporate
seal to be hereunto affixed and attested by their
officers thereunto duly authorized, all as of the day
and year first above written.
Attest S&T BANCORP, INC.
By
Name: /s/ Xxxxx X. Xxxxxx Name: /s/ Xxxxxx X. Xxxxxx
Title: Executive Vice President Title: Chairman and CEO
(SEAL)
Attest PEOPLES BANK OF UNITY
By
Name: /s/ Xxxxxx X. Dragonza Name: /s/ Xxxxxxx X. Xxxxxx
Title: SVP, CFO & acting CEO Title: President
(SEAL)
Attest S&T BANK
By
Name:/s/ Xxxxxx X. Xxxxxx Name: /s/ Xxxxx X. Xxxxxx
Title: Chairman & CEO Title: President & COO
(SEAL)
