EXHIBIT 99.2
REPUBLIC SECURITY FINANCIAL CORPORATION
000 Xxxxx Xxxxxxxxxx Xxxxxx
Xxxx Xxxx Xxxxx, Xxxxxxx 00000
October 29, 2000
Attention:
Ladies and Gentlemen:
We refer to the Agreement and Plan of Merger (the "Agreement") of
even date herewith between Wachovia Corporation ("Buyer") and Republic
Security Financial Corporation ("Republic"). Capitalized terms used but not
defined herein shall have the meanings ascribed to them in the Agreement.
In order to induce Xxxxx to enter into the Agreement, and in
consideration of Xxxxx's undertaking of efforts in furtherance of the
transactions contemplated thereby, Republic agrees as follows:
1. Representations and Warranties. Republic hereby
represents and warrants to Buyer that Republic has all requisite corporate
power and authority to enter into this letter agreement (the "Letter
Agreement") and to perform its obligations set forth herein. The execution,
delivery and performance of this Letter Agreement have been duly and
validly authorized by all necessary corporate action on the part of
Republic. This Letter Agreement has been duly executed and delivered by
Republic and is a valid and legally binding obligation of Republic.
2. Termination Fee. (a) In the event that:
(i) Either (x) the Agreement shall have been
terminated pursuant to Sections 10.1(b) or 10.1(c) thereof, in
either case by Buyer by virtue of a willful breach by Republic
that remains uncured after written notice of such breach shall
have been provided to Republic by Buyer or (y) the Agreement shall
have been terminated pursuant to any provision of Section 10.1
thereof and prior to or concurrently with such termination, a
First Trigger Event shall have occurred; and
(ii) prior to, concurrently with or within 12
months after the termination of the Agreement an
Acquisition Event (as such term is defined below) shall
have occurred,
Republic shall pay to Buyer a cash fee of $15 million. Such fee shall be
payable in immediately available funds on or before the second business day
following the occurrence of such Acquisition Event.
(b) As used herein, a "First Trigger Event" shall mean
the occurrence of any of the following events:
(i) Republic's Board of Directors shall have
failed to approve or recommend the Agreement or the Merger, or
shall have withdrawn or modified in a manner adverse to Buyer its
approval or recommendation of the Agreement or the Merger, or
shall have resolved or publicly announced an intention to do
either of the foregoing;
(ii) Republic or any Significant Subsidiary (as
such term is defined below), or the Board of Directors of Republic
or a Significant Subsidiary, shall have recommended that the
stockholders of Republic approve any Acquisition Proposal (as such
term is defined below) or shall have entered into an agreement
with respect to, or authorized, approved, proposed or publicly
announced its intention to enter into, any Acquisition Proposal;
(iii) the Agreement shall not have been approved
at a meeting of Republic stockholders which has been held for that
purpose prior to termination of the Agreement in accordance with
its terms or such meeting shall not have been held in violation of
the Agreement or shall have been cancelled before termination of
the Agreement, if prior thereto it shall have been publicly
announced that any person (other than Buyer or any of its
subsidiaries) shall have made, or disclosed an intention to make,
an Acquisition Proposal;
(iv) any person (together with its affiliates
and associates) or group (as such terms are used for purposes of
Section 13(d) of the Exchange Act) other than Buyer and its
subsidiaries shall have acquired beneficial ownership (as such
term is used for purposes of Section 13(d) of the Exchange Act) or
the right to acquire beneficial ownership of 10% or more of the
then outstanding shares of the stock then entitled to vote
generally in the election of directors of Republic or a
Significant Subsidiary;
(v) following the making of an Acquisition
Proposal, Republic shall have intentionally breached any covenant
or agreement contained in the Agreement such that Buyer would be
entitled to terminate the Agreement under Section 10.1(c) thereof
(without regard to any grace period provided for therein) unless
such breach is promptly cured without jeopardizing consummation of
the Merger pursuant to the terms of the Agreement; or
(vi) any person other than Buyer or any of its
subsidiaries shall have made an Acquisition Proposal and such
Acquisition Proposal shall have been publicly announced.
(c) As used herein, "Acquisition Event" shall mean (i)
the execution by Republic of a definitive agreement providing for, or the
consummation of, any transaction described in clauses (A), (B), or (C) of
the definition of "Acquisition Proposal," except that the percentage
reference contained in clause (C) of such definition shall be 30% instead
of 10% or (ii) the acquisition by any person (together with its affiliates
and associates) or group (as such terms are used for purposes of Section
13(d) of the Exchange Act) other than Republic, Buyer and any of their
respective subsidiaries of beneficial ownership (as such term is used for
purposes of Section 13(d) of the Exchange Act) or the right to acquire
beneficial ownership of more than 30% of the then outstanding shares of the
stock then entitled to vote generally in the election of directors of
Republic or a Significant Subsidiary.
(d) As used herein, "Acquisition Proposal" shall mean
after the date hereof any (i) publicly announced proposal, (ii) regulatory
application or notice (whether in draft or final form), (iii) agreement or
understanding, (iv) disclosure of an intention to make a proposal, or (v)
amendment to any of the foregoing, made or filed on or after the date
hereof, in each case with respect to any of the following transactions with
a counterparty other than Buyer or any of its subsidiaries: (A) a merger or
consolidation, or any similar transaction, involving Republic or any
Significant Subsidiary (other than mergers, consolidations or similar
transactions involving solely Republic and/or one or more wholly-owned
subsidiaries of Republic and other than a merger or consolidation as to
which the common stockholders of Republic immediately prior thereto in the
aggregate own at least 60% of the common stock of the publicly held
surviving or successor corporation (or any publicly held ultimate parent
company thereof) immediately following consummation thereof); (B) a
purchase, lease or other acquisition of all or substantially all of the
assets or deposits of Republic or any Significant Subsidiary; or (C) a
purchase or other acquisition (including by way of merger, consolidation,
share exchange or otherwise) of securities representing 10% or more of the
voting power of Republic or any Significant Subsidiary.
(e) As used herein, "Significant Subsidiary" shall mean a
"significant subsidiary," as defined in Rule 1-02 of Regulation S-X
promulgated by the Securities and Exchange Commission, of Republic.
3. To the extent that Republic is prohibited by applicable law or
regulation, or by administrative actions or policy of a federal or state
financial institution supervisory agency having jurisdiction over it, from
making the payments required to be paid by Republic herein in full, it
shall immediately so notify Buyer and thereafter deliver or cause to be
delivered, from time to time, to Buyer, the portion of the payments
required to be paid by it herein that it is no longer prohibited from
paying, within five business days after the date on which Republic is no
longer so prohibited; provided, however, that if Republic at any time is
prohibited by applicable law or regulation, or by administrative actions or
policy of a federal or state financial institution supervisory agency
having jurisdiction over it, from making the payments required hereunder in
full, it shall (i) use its reasonable best efforts to obtain all required
regulatory and legal approvals and to file any required notices as promptly
as practicable in order to make such payments, (ii) within five days of the
submission or receipt of any documents relating to any such regulatory and
legal approvals, provide Buyer with copies of the same, and (iii) keep
Buyer advised of both the status of any such request for regulatory and
legal approvals, as well as any discussions with any relevant regulatory or
other third party reasonably related to the same.
4. In the event of an Acquisition Event and the payment by
Republic of the fee provided for in Section 2 hereof, Buyer shall have the
right to no further remedy from Republic as a result of the termination of
the Agreement and the consummation of an Acquisition Event.
5. Except where federal law specifically applies, this Agreement
shall be construed and interpreted according to the laws of the State of
North Carolina without regard to conflicts of laws principles thereof.
6. This Letter Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
7. Nothing contained herein shall be deemed to authorize Republic
or Buyer to breach any provision of the Agreement.
8. The provisions of this Letter Agreement shall be binding upon,
inure to the benefit of, and be enforceable by the parties and their
respective successors and assigns.
Please confirm your agreement with the understanding set
forth herein by signing and returning to us the enclosed copy of this
Letter Agreement.
Very truly yours,
REPUBLIC SECURITY
FINANCIAL CORPORATION
By: /s/ Xxxx X. Xxxxxx
___________________________
Xxxx X. Xxxxxx
Chairman, President, and
Chief Executive Officer
Accepted and agreed to as of the date first above written:
WACHOVIA CORPORATION
By: /s/ Stanhope X. Xxxxx
_____________________________
Xxxxxxxx X. Xxxxx
