Exhibit 2.1
STOCK EXCHANGE AGREEMENT
AND PLAN OF REORGANIZATION
THIS AGREEMENT is made and effective as of this 20th day of October, 1995,
between (1) FIRST FINANCIAL BANKSHARES, INC. (hereinafter referred to as ("FIRST
FINANCIAL"), a Texas corporation with its principal office in the City of
Abilene, Xxxxxx County, Texas; (2) Xxxxxxxxxxx National Bancshares, Inc.
("WEATHERFORD BANCSHARES"), a Texas corporation and bank holding company with
its principal office in the City of Weatherford, Parker County, Texas; (3)
Xxxxxx Bancshares, Inc. ("XXXXXX BANCSHARES"), a Delaware Corporation and bank
holding company; and (4) Weatherford National Bank ("Bank"), a national bank
having its principal office in the City of Weatherford, Parker County, Texas.
First Financial is a registered bank holding company. First Financial owns
all of the issued and outstanding capital stock of First Financial Bankshares of
Delaware, Inc. ("FFB DELAWARE") which, in turn, owns all of the issued and
outstanding capital stock of First National Bank of Abilene; First National
Bank, Sweetwater; Eastland National Bank; Hereford State Bank; First National
Bank in Cleburne; Stephenville Bank & Trust Co.; and Southwest Bank of San
Xxxxxx.
As of the date of this Agreement, Weatherford Bancshares has 1,000,000
authorized shares of Common Stock (the "WEATHERFORD BANCSHARES STOCK") having a
par value of Five Dollars ($5.00) each, with 215,988 shares being issued and
outstanding. According to the records of Weatherford Bancshares, the Weatherford
Bancshares Common Stock is presently held by those individuals, trusts, estates,
corporations and other entities (the "Shareholders") identified in the
Shareholders' List attached hereto as EXHIBIT X.
Xxxxxxxxxxx Bancshares owns 25,096 shares (100%) of the issued and
outstanding capital stock of Xxxxxx Bancshares ("XXXXXX BANCSHARES STOCK").
Xxxxxx Bancshares is the only subsidiary of Weatherford Bancshares. Xxxxxx
Bancshares owns 200,000 shares (100%) of the issued and outstanding capital
stock of Bank ("BANK STOCK"). There are no other corporations or other business
entities which are considered affiliates of Weatherford Bancshares, Xxxxxx
Bancshares or Bank.
Pursuant to, and subject to, the provisions hereinafter set forth, First
Financial agrees to acquire from the Shareholders all of the issued and
outstanding shares of Weatherford Bancshares (hereinafter referred to as the
"SHARES") in exchange for shares of the voting common stock of First Financial
("FIRST FINANCIAL STOCK") which shall be issued and registered by First
Financial under the Securities Act of 1933 (the "ACT").
THEREFORE, in consideration of the premises, and in further consideration
of the mutual covenants and on the basis of the representations and warranties
set forth herein, First Financial, Weatherford Bancshares, Xxxxxx Bancshares and
Bank have agreed, and by these presents do hereby agree, as follows:
ARTICLE 1.
EXCHANGE OF STOCK
1.1. MEANS OF EXCHANGE. The offer to acquire all of the shares of
Weatherford Bancshares for shares of First Financial Stock (the "EXCHANGE
OFFER") shall be made by means of a Prospectus to be delivered to each of the
Shareholders upon or following the effective date of a Registration Statement to
be filed by First Financial in accordance with the Securities Act of 1933.
1.2. RATIO OF EXCHANGE. Subject to all terms and conditions of this
Agreement, First Financial shall be obligated to issue and exchange 1.5 shares
of First Financial Stock for each share of Weatherford Bancshares Stock tendered
by the Shareholders who accept the exchange offer during the time period the
Exchange Offer is in effect; PROVIDED, HOWEVER, that if First Financial, prior
to consummation of the proposed exchange offer, shall issue any additional
shares of First Financial Stock pursuant to any stock dividend or stock split,
the ratio of exchange shall be adjusted so as to prevent dilution of the
interest in First Financial to be received by the Shareholders of Weatherford
Bancshares.
1.3. MEANS OF ACCEPTANCE OF EXCHANGE OFFER. A form of certificate and
acceptance of the exchange offer (the "EXCHANGE FORM") shall accompany the
Prospectus to be delivered to each Shareholder of Weatherford Bancshares. Once
the Exchange Form has been signed by a Shareholder (which shall certify that
such Shareholder's stock is fully paid and nonassessable and is being assigned
to First Financial free and clear of all liens, options and encumbrances), and
delivered to the Transfer Agent named below, the same shall be deemed to
constitute an acceptance of the Exchange Offer to the extent of the number of
shares of Weatherford Bancshares Stock accompanying such Exchange Form. Shares
of Weatherford Bancshares Stock delivered by the Shareholders to the Transfer
Agent pursuant to the exchange offer may not be withdrawn. If, for any reason,
the Exchange Offer is terminated and the exchange of Weatherford Bancshares
Stock for First Financial Stock is not consummated, then all shares tendered by
the Shareholders for exchange shall be promptly returned by the Transfer Agent.
1.4. MEANS OF CONSUMMATING THE EXCHANGE. The Transfer Agent, during the
pendency of the Exchange Offer, shall notify First Financial and Weatherford
Bancshares daily of the number of shares of Weatherford Bancshares Stock
tendered for exchange under properly executed Exchange Forms. If First Financial
receives written notice from the Transfer Agent that the Required Amount of
Weatherford Bancshares Stock (as herein defined) has been tendered and assigned
to First Financial, then, within ten (10) days after the Closing Date (herein
defined), First Financial shall issue and mail to those Shareholders who have
tendered their shares of Weatherford Bancshares Stock, by registered mail,
certificates for the First Financial Stock representing 1.5 shares of First
Financial's stock for each share of Weatherford Bancshares Stock received by the
Transfer Agent, or such other number of shares as may be required under Section
1.2 above. For purposes of this Agreement, the "CLOSING DATE" shall be the later
of (i) the date First Financial receives notice from the Transfer Agent that the
Required Amount of Weatherford Bancshares Stock (as herein defined) has been
tendered, (ii) the expiration date of the Exchange Offer, or (iii) the date when
all conditions precedent to
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consummation of the exchange have been satisfied (or, if not satisfied, have
been waived in writing by First Financial).
Notwithstanding the foregoing provisions of this Section and of Section
1.3, First Financial shall not issue any fractional shares of its common stock.
Shareholders of Weatherford Bancshares who would otherwise be entitled to
receive fractional shares of First Financial Stock shall be paid in cash for
such fractional shares based upon a value of $33.34 per share of First Financial
Stock. Any cash payment to which a Shareholder of Weatherford Bancshares may be
entitled shall be included with such Shareholder's certificate for First
Financial Stock when such certificate is mailed to such Shareholder.
1.5. TRANSFER AGENT. The Transfer Agent for purposes of this transaction
shall be First National Bank of Abilene - Trust Department, Third Floor, 000
Xxxx Xxxxxx, Xxxxxxx, Xxxxx 00000.
1.6. EFFECTIVE DATE OF EXCHANGE OFFER. The effective date for commencement
of the Exchange Offer (the "EFFECTIVE DATE") contemplated by this Agreement
shall be the later of:
(a) The date upon which the Prospectus is mailed by First Financial to the
Shareholders of Weatherford Bancshares pursuant to the Registration Statement
(not before but on or following the effective date thereof) filed by First
Financial with the Securities and Exchange Commission with respect to the First
Financial Stock to be issued hereunder; or
(b) Such other date as may be mutually agreed upon by First Financial and
Weatherford Bancshares.
1.7. OFFER TERMINATION DATE. Unless otherwise extended by First Financial,
the Exchange Offer shall terminate twenty-one (21) business days after the
Effective Date.
1.8. MERGER. If the Required Amount of Weatherford Bancshares Stock (as
defined in Section 2.2) is tendered in exchange for First Financial Stock, and
if all other conditions precedent to consummation of the exchange are satisfied
(or, if not satisfied, are waived by First Financial) and First Financial shall
consummate the exchange by delivering to the tendering Shareholders the shares
of First Financial Stock (and, with regard to any fractional shares, the cash
payments) to which such Shareholders are entitled hereunder, it is the intent of
First Financial to immediately thereafter merge Weatherford Bancshares with and
into FFB Delaware pursuant to applicable law. If the Exchange Offer is
consummated, but less than all of the Weatherford Bancshares Stock is tendered
in exchange for First Financial Stock, then as part of the proposed merger of
Weatherford Bancshares into FFB Delaware, those Shareholders of Weatherford
Bancshares who did not tender their shares pursuant to the Exchange Offer made
under this Agreement will be required to accept First Financial Stock (and cash
for any fractional shares of First Financial Stock) upon the same basis
(exchange rate and cash) as the exchange of Weatherford Bancshares Stock for
First Financial Stock (and cash for fractional shares) will be made under this
Agreement, subject only to the rights, if any, afforded by Delaware or Texas law
(whichever shall apply) to any Shareholders of Weatherford Bancshares
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who dissent from the merger and refuse to accept First Financial Stock (and cash
for fractional shares) in return for their Weatherford Bancshares Stock.
ARTICLE 2.
CONDITIONS PRECEDENT TO EXCHANGE OFFER
AND CONSUMMATION OF TRANSACTION
Unless otherwise agreed in writing by First Financial and Weatherford
Bancshares, the obligations of First Financial to offer First Financial Stock to
the Shareholders pursuant to this Agreement and, thereafter, the obligations of
First Financial and Weatherford Bancshares to consummate the exchange of stock
contemplated by this Agreement shall be expressly subject to the satisfaction of
the following conditions:
2.1. REGULATORY APPROVALS. (1) The Board of Governors of the Federal
Reserve System shall have approved, in writing, the acquisition by First
Financial of all of the issued and outstanding capital stock of Weatherford
Bancshares; (2) all other approvals and authorizations of, filings and
registrations with, and notifications to, all federal, state and local
authorities required for the consummation of the transaction contemplated hereby
shall have been obtained or made and shall be in full force and effect; and (3)
all mandatory waiting periods shall have elapsed.
2.2. TAX RULINGS. (1) Weatherford Bancshares shall have received a written
opinion from its independent accountants and/or tax counsel stating that the
exchange of their Weatherford Bancshares Stock by the Shareholders will not be
considered a taxable event for federal income tax purposes; and (2) First
Financial shall have received a written opinion from its independent accounts,
Xxxxxx Xxxxxxxx LLP, in form and substance satisfactory to First Financial,
stating that the acquisition by First Financial of the Required Amount of
Weatherford Bancshares Stock will be treated for accounting purposes as a
"pooling-of-interests." For purposes of this Agreement, the term "REQUIRED
AMOUNT OF WEATHERFORD BANCSHARES STOCK" shall mean that number of shares of
Weatherford Bancshares Stock (as determined by First Financial's independent
accountants) which must be tendered by the Shareholders in exchange for First
Financial Stock in order for the acquisition by First Financial to be treated
for accounting purposes as a "pooling-of-interests," and which number of shares,
for purposes of this transaction, shall be at least 90% of the issued and
outstanding shares of Weatherford Bancshares Stock.
2.3. ACCURACY OF REPRESENTATIONS AND WARRANTIES. Except as otherwise
expressly provided herein, all of the representations and warranties of First
Financial, Weatherford Bancshares, Xxxxxx Bancshares, and Bank contained in this
Agreement shall be true as of the Closing Date, with the same force and effect
as though made on the Effective Date and Closing Date, respectively, and there
shall be delivered on the Effective Date and the Closing Date appropriate
certificates of authorized officers of First Financial, Weatherford Bancshares,
Xxxxxx Bancshares, and Bank.
2.4. PERFORMANCE OF AGREEMENTS. First Financial, Weatherford Bancshares,
Xxxxxx Bancshares, and Bank shall have performed all obligations and agreements,
and shall have
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complied with all covenants and conditions, contained in this Agreement to be
performed and complied with by it or them on or prior to the Closing.
2.5. NO GOVERNMENTAL PROCEEDING OR LITIGATION. No order, judgment or decree
of any competent court, governmental body or regulatory authority shall be
outstanding which declares or seeks a declaration that this Agreement is invalid
or which restrains, or seeks to restrain, the consummation of the Exchange
Offer; and no action or proceeding shall be pending which questions the validity
or legality of, or seeks to restrain the consummation of, the exchange
contemplated by this Agreement.
2.6. FINANCIAL REPORTS. First Financial shall have received such financial
reports of Weatherford Bancshares and its subsidiaries prepared by Weatherford
Bancshares' independent accountants as of September 30, 1995, at First
Financial's Expense, in form and content necessary to satisfy the requirements
pertaining to the filing of a registration with the Securities and Exchange
Commission of the shares of First Financial Bankshares to be issued pursuant to
this agreement.
2.7. SECURITIES LAWS. (1) The declaration by the Securities and Exchange
Commission that the Registration Statement filed by First Financial pursuant to
the Act covering the shares of First Financial stock to be issued pursuant to
this Agreement is effective and the furnishing of a Prospectus to the
Shareholders of Weatherford Bancshares; (2) all approvals and authorization of,
filings and registrations with, and notifications to, all regulatory authorities
under state securities or Blue Sky laws required for the offer, sale, exchange
or qualification of the First Financial Stock in connection with the exchange
offer shall have been obtained or made and shall be in full force and effect;
(3) First Financial, Weatherford Bancshares, Xxxxxx Bancshares, and Bank shall
have complied with all federal and state securities laws, statutes, rules and
regulations applicable to the exchange offer contemplated by this Agreement; and
(4) no stop order has been issued or threatened by the SEC or any state
securities authority with respect to the offer, sale, issuance or exchange of
stock contemplated hereby.
2.8. TENDER OF SHARES. The delivery by Shareholders owning the Required
Amount of Weatherford Bancshares Stock of duly and properly executed Exchange
Forms effectively transferring and assigning their shares of Weatherford
Bancshares Stock to First Financial free and clear of all liens, options and
encumbrances and with all of such stock being fully paid and non-assessable at
the time of transfer.
2.9. NO MATERIAL CHANGES. The absence of any material adverse change in the
financial conditions of First Financial, Weatherford Bancshares, Xxxxxx
Bancshares, or Bank between August 31, 1995 and the Closing Date.
2.10. OPINION OF WEATHERFORD BANCSHARES'S COUNSEL. First Financial shall
have received the written opinion of counsel for Weatherford Bancshares, Xxxxxx
Bancshares, and Bank dated at or as of the Closing Date, and in form and
substance satisfactory to First Financial and its counsel, that (1) Weatherford
Bancshares is duly organized, validly existing and in good standing under the
laws of the State of Texas; (2) Xxxxxx Bancshares is duly organized, validly
existing and in good standing with the laws of the State of Delaware; (3) Bank
is duly organized, validly existing and in good standing under the laws of the
United States and of the State of
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Texas; (4) Weatherford Bancshares, Xxxxxx Bancshares, and Bank have all
requisite power and authority to execute and deliver this Agreement and to
consummate the transaction contemplated thereby; (5) the execution and delivery
by Weatherford Bancshares, Xxxxxx Bancshares, and Bank does not, and the
consummation of the transaction contemplated thereby, will not contravene or
violate any provisions of or constitute a default under the (a) Articles of
Incorporation or Association or Bylaws of Weatherford Bancshares, Xxxxxx
Bancshares, or Bank (b) any law, regulation, rule, decree, order or judgment of
any court, governmental agency or public body applicable to Weatherford
Bancshares, Xxxxxx Bancshares, or Bank or any of their respective assets or
property; (6) all consents, approvals, authorizations, actions or filings with
any court, governmental agency or public body required in connection with the
execution, delivery and performance by Weatherford Bancshares, Xxxxxx
Bancshares, and Bank of this Agreement have been obtained; (7) Weatherford
Bancshares, Xxxxxx Bancshares, and Bank have good and merchantable title to all
of their assets and properties; (8) all of the outstanding shares of Weatherford
Bancshares Stock, Xxxxxx Bancshares Stock, and Bank Stock have been validly
issued and are non-assessable and fully paid; (9) except as reflected in
Disclosure Schedules C and D, there are no known material liabilities, claims or
lawsuits pending against Weatherford Bancshares, Xxxxxx Bancshares, or Bank or
any of their respective properties or assets; (10) between the date of this
Agreement and the Closing Date, there has been no increase in the number of
issued and outstanding shares of Weatherford Bancshares Stock, Xxxxxx Bancshares
Stock or Bank Stock; and (11) except as disclosed in Disclosure Schedule F, all
Xxxxxx Bancshares Stock owned by Weatherford Bancshares and all Bank Stock owned
by Xxxxxx Bancshares is free and clear of liens, security interests, transfer
restrictions and other encumbrances.
2.11. ENVIRONMENTAL REPORT. First Financial shall have received, at First
Financial's expense, a satisfactory Phase I Environmental Assessment report
covering all real property of Weatherford Bancshares, Xxxxxx Bancshares or Bank,
whether such real property is used by Weatherford Bancshares, Xxxxxx Bancshares,
or Bank in its corporate or banking business, held for resale or otherwise owned
or held by Weatherford Bancshares, Xxxxxx Bancshares, or Bank.
2.12. WEATHERFORD NATIONAL 401(K) PROFIT SHARING PLAN. The Board of
Directors of Weatherford Bancshares, Xxxxxx Bancshares, and Weatherford National
shall, prior to the consummation of the stock exchange transaction, adopt such
resolutions and take such other action, as may be necessary, to freeze,
terminate, or merge the Weatherford National 401(k) Profit Sharing Plan as
adopted effective January 1, 1989; provided, that such resolutions may provide
that such action shall be subject to consummation of the stock exchange
transaction contemplated by this agreement.
In addition, First Financial and its counsel shall be satisfied, in their
opinion, that (1) the 401(k) Profit Sharing Plan is a qualified plan under, and
in full compliance with, the Employee Retirement Income Security Act of 1974
("ERISA"), as amended, the Internal Revenue Code of 1986, as amended, and all
other applicable laws, rules and regulations; and (2) no facts or circumstances
exist which, in the opinion of First Financial and its counsel, may result in
liability to First Financial, Weatherford Bancshares, Xxxxxx Bancshares or Bank,
or any of its or their directors, officers or employees arising out of, or in
connection with, administration of the 401(k) Profit Sharing Plan, freezing or
termination of the Plan, or merging
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of the Plan with any Employee Benefit Plan administered by First Financial, if
the transaction contemplated by this Agreement is consummated.
2.13. OPINION OF FIRST FINANCIAL'S COUNSEL. Weatherford Bancshares shall
have received the written opinion of counsel for First Financial, dated at or as
of the Closing Date and in form and substance satisfactory to Weatherford
Bancshares and its counsel, that (1) First Financial is duly organized, validly
existing and in good standing under the laws of the State of Texas; (2) First
Financial has all requisite power and authority to execute and deliver the
Agreement and to consummate the transaction contemplated thereby; (3) the
execution and delivery by First Financial of the Agreement does not, and
consummation of the transaction contemplated thereby will not, contravene or
violate any provision of or constitute a default under the (a) articles of
incorporation or bylaws of First Financial, or (b) any law, regulation, rule,
decree, order or judgment of any court, governmental agency or public body
applicable to First Financial or its assets or properties; and (4) all consents,
approvals, authorizations, actions or filings with any court, governmental
agency or public body required in connection with the execution, delivery and
performance by First Financial of the Agreement have been obtained.
ARTICLE 3.
WARRANTIES AND REPRESENTATIONS OF
WEATHERFORD BANCSHARES, XXXXXX BANCSHARES, AND BANK
Weatherford Bancshares, Xxxxxx Bancshares, and Bank hereby jointly and
severally make the following warranties and representations to First Financial:
3.1. ORGANIZATION AND STANDING OF WEATHERFORD BANCSHARES. Weatherford
Bancshares is a Texas corporation duly organized, validly existing and in good
standing under the laws of the State of Texas, with corporate power to own
property and carry on its business as it is now being conducted. Weatherford
Bancshares is also a registered bank holding company under the Bank Holding
Company Act of 1956, as amended. The copies of the Articles of Incorporation and
Bylaws of Weatherford Bancshares, including all amendments thereto, delivered,
or to be delivered, to First Financial are, or will be, complete and accurate in
all respects.
3.2. ORGANIZATION AND STANDING OF XXXXXX BANCSHARES. Xxxxxx Bancshares is a
Delaware corporation duly organized, validly existing and in good standing under
the laws of the State of Delaware, with corporate power to own property and
carry on its business as it is now being conducted. Xxxxxx Bancshares is also a
registered bank holding company under the Bank Holding Company Act of 1956, as
amended. The copies of the Articles of Incorporation and Bylaws of Xxxxxx
Bancshares, including all amendments thereto, delivered, or to be delivered, to
First Financial are, or will be, complete and accurate in all respects.
3.3. ORGANIZATION AND STANDING OF BANK. Bank is a national bank duly
organized. validly existing and in good standing under national banking laws,
with corporate power to own property and carry on its business as it is now
being conducted. Bank is an insured bank under the Federal Deposit Insurance
Act. All of the banking business and all of the banking offices and
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facilities of Bank are located within the State of Texas. The copies of the
Articles of Incorporation and Bylaws of Bank, including all amendments thereto,
delivered, or to be delivered, to First Financial are, or will be, complete and
accurate in all respects.
3.4. SUBSIDIARIES AND AFFILIATES. Weatherford Bancshares does not have any
subsidiaries other than Xxxxxx Bancshares. Xxxxxx Bancshares does not have any
subsidiaries other than Bank. Bank does not have any subsidiaries. Neither
Weatherford Bancshares, Xxxxxx Bancshares, nor Bank holds any interest in any
other corporation, firm, joint venture or partnership, except (1) as security
for repayment of loans to customers of Bank, (2) as acquired by Bank through
foreclosure or otherwise by reason of debt previously contracted, or (3) for
authorized investment securities purchased by Weatherford Bancshares, Xxxxxx
Bancshares, or Bank for its own account (but, as a result of which investments,
neither Weatherford Bancshares, Xxxxxx Bancshares, nor Bank is considered to be
an affiliate of the issuer of such securities or otherwise controls, is
controlled by or is under common control with, the issuer of any such investment
securities).
3.5. CAPITALIZATION. As of the date of this Agreement, the authorized
capital stock of Weatherford Bancshares consists of 1,000,000 shares of common
stock of a par value of $5.00 each, of which 215,988 are presently issued and
outstanding. The authorized capital stock of Xxxxxx Bancshares consists of
200,000 shares of common stock of a par value of $ .01, of which 25,096 shares
are issued and outstanding, and all of which shares of Xxxxxx Bancshares stock
are owned by Weatherford Bancshares. The authorized capital stock of Bank
consists of 200,000 shares of common stock of a par value of $5.00, of which
200,000 are presently issued and outstanding. Xxxxxx Bancshares now owns all of
the issued and outstanding common stock of Bank. All rights, privileges,
restrictions (if any), terms and provisions governing the shares of common stock
of Weatherford Bancshares, Xxxxxx Bancshares, and Bank are described in the
Articles of Association and Bylaws (as amended) of Weatherford Bancshares,
Xxxxxx Bancshares, and Bank, respectively; and there are not (nor shall be on
the Closing Date) any outstanding or authorized subscriptions, options,
warrants, calls, rights or commitments or any kind restricting the transfer of,
requiring the issuance or sale of, or otherwise relating to, any of the capital
stock of Weatherford Bancshares, Xxxxxx Bancshares, or Bank.
3.6. AUTHORITY OF WEATHERFORD BANCSHARES. This Agreement has been duly
executed and delivered by, and has been duly authorized by all necessary
corporate action on the part of, Weatherford Bancshares, Xxxxxx Bancshares, and
Bank, respectively, and, subject to the conditions precedent to closing of this
transaction set forth herein, is a valid, legally binding and enforceable
obligation of Weatherford Bancshares, Xxxxxx Bancshares, and Bank. Subject to
First Financial's obtaining the approval of the Board of Governors of the
Federal Reserve System, neither the execution, delivery or performance of this
Agreement in its entirety, nor the consummation of all of the transactions
contemplated hereby, will violate (with or without the giving of notice or the
passage of time), be in conflict with, result in a breach of any provision of,
or constitute a default under, any provision in the Articles of Incorporation,
Articles of Association or Bylaws of, or any provision of law applicable to,
Weatherford Bancshares. Xxxxxx Bancshares, or Bank or any agreement or
understanding, order, judgment, award, decree, statute, ordinance, regulation or
other restriction of any kind or character to which Weatherford Bancshares,
Xxxxxx Bancshares or Bank is a party or by which any of the respective assets or
properties of Weatherford Bancshares, Xxxxxx Bancshares, or Bank are subject or
bound.
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3.7. LICENSES, PERMITS AND CONTRACTS. None of the assets, licenses,
permits, authorizations and contracts of Weatherford Bancshares, Xxxxxx
Bancshares, or Bank will be terminated or impaired by reason of execution,
delivery or performance of this Agreement by Weatherford Bancshares, Xxxxxx
Bancshares or Bank, or consummation of the transactions contemplated hereby.
3.8. CLAIMS, SUITS AND PROCEEDINGS. Except as reflected in Disclosure
Schedule D, there are no actions, suits, proceedings or claims pending or, to
their knowledge, threatened against Weatherford Bancshares, Xxxxxx Bancshares,
or Bank, at law or in equity, or before any federal, state, municipal or other
governmental court, department, commission, board, bureau, agency,
instrumentality or other person, which would result in liability to Weatherford
Bancshares, Xxxxxx Bancshares, or Bank upon consummation of the transaction
contemplated hereby or which would prevent or delay such consummation. In
particular, and without in any way limiting the foregoing, neither Weatherford
Bancshares, Xxxxxx Bancshares, nor Bank is subject to, or a party to, any cease-
and-desist, supervisory or other agreement with any banking or other regulatory
authority which requires the consent or approval of such authority or which is
otherwise applicable to the transaction contemplated by this Agreement.
3.9. CONSENTS AND APPROVALS. No consent, approval or authorization of, or
declaration, filing or registration with, any person or governmental authority
is required in connection with the execution and delivery of this Agreement by
Weatherford Bancshares, Xxxxxx Bancshares, or Bank, and consummation of the
transaction contemplated hereby, except for such approvals as may be required
for First Financial to acquire the Weatherford Bancshares Stock and for such
approvals by the Boards of Directors of Weatherford Bancshares, Xxxxxx
Bancshares, and Bank as have been given prior to execution of this Agreement.
3.10. REGULATORY REPORTS. Weatherford Bancshares, Xxxxxx Bancshares, and
Bank have filed all reports, registrations and statements, together with any
amendments required to be made thereto, that are required to be filed with the
Federal Reserve Board (the "FRB"), Comptroller of the Currency (the "OCC"), the
Federal Deposit Insurance Corporation (the "FDIC"), the Securities and Exchange
Commission (the "SEC") and any other applicable authorities, and all of such
reports, registrations and statements are true, complete and correct in all
material respects.
3.11. FINANCIAL STATEMENTS. Weatherford Bancshares, Xxxxxx Bancshares and
Bank have provided, or caused to be provided, to First Financial the Financial
Statements and Reports described in Disclosure Schedule A attached hereto and
the notes thereto (collectively, the "FINANCIAL STATEMENTS"), all of which have
been prepared in accordance with generally accepted accounting principles
("GAAP") or regulatory accounting principles ("RAP"); and the Financial
Statements, as of their respective dates, conformed in all material respects
with all applicable material rules and regulations promulgated by the FRB, the
OCC and the FDIC.
3.12. UNDISCLOSED LIABILITIES. Except to the extent reflected in the
Financial Statements or as reflected in Disclosure Schedule B, Weatherford
Bancshares, Xxxxxx Bancshares, and Bank have no material liabilities or
obligations (absolute, accrued, contingent or otherwise).
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3.13. ABSENCE OF CERTAIN CHANGES. Except as and to the extent reflected in
Disclosure Schedule C, neither Weatherford Bancshares, Xxxxxx Bancshares, nor
Bank, from August 31, 1995, until the date of this Agreement, has:
(a) made any amendment to its Articles of Association or Bylaws or changed
the character of its business in any material manner;
(b) suffered any material adverse change in its financial condition,
assets, liabilities (absolute, accrued, contingent or otherwise) or business;
(c) incurred, assumed or become subject to, whether directly or by way of
any guarantee or otherwise, any obligations or liabilities (absolute, accrued,
contingent or otherwise) except in the ordinary course of business;
(d) permitted or allowed any of its property or assets to be subject to any
mortgage, pledge, lien, security interest, encumbrance, restriction or change of
any kind;
(e) canceled any debts in excess of $25,000, waived any claims or rights of
material value, or sold, transferred, or otherwise disposed of any of its
properties or assets, except in the ordinary course of business;
(f) disposed of or permitted to lapse any rights to the use of any material
trademark, trade name or copyright, or disposed of or disclosed to any person
other than its employees any material trade secret not theretofore a matter of
public knowledge;
(g) granted any increase in compensation, or paid or agreed to pay or
accrue any bonus or like benefit, to or for the credit of any director, officer
or employee except in the ordinary course of business, or entered into any
employment or consulting contract or other agreement for personal services with
any director, officer or employee, or adopted, amended or terminated any
Employee Benefit Plan;
(h) declared, paid or set aside for payment any dividend or other
distribution or payment in respect of its capital stock (other than normal,
regular dividends or distributions of Bank to Xxxxxx Bancshares and Xxxxxx
Bancshares to Xxxxxxxxxxx Bancshares);
(i) organized or acquired, except through foreclosure, the exercise of
creditors remedies or in a fiduciary capacity, any capital stock or other equity
securities of any corporation or acquired any equity or ownership interest in
any partnership or business enterprise;
(j) issued, reserved for issuance, granted, or authorized the issuance of
any shares of its capital stock or subscriptions, options, warrants, calls,
rights or commitments of any kind relating to the issuance of or conversion into
shares of its capital stock;
10
(k) made any change in any method of accounting or accounting practice,
except as required by applicable law, regulation or GAAP;
(l) except for the transactions contemplated by this Agreement, or as
otherwise permitted hereunder, entered into any transaction, or entered into,
modified or amended any contract or commitment, other than in the ordinary
course of business; or
(m) agreed, whether in writing or otherwise, to take any action the
performance of which would be prohibited by this Section 3.13.
3.14. TITLE TO PROPERTIES; ENCUMBRANCES. Except for the liens and security
interests disclosed in Disclosure Schedule F securing the indebtedness described
therein, Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares, and Bank have, or will have
upon the Closing Date, unencumbered, good and merchantable title to all their
properties and assets, real and personal, including, without limitation, all
properties and assets reflected in the Financial Statements, except for (i)
easements, reservations, restrictions, rights-of-way, and other encumbrances of
record, other than liens and conveyances, and (ii) those properties and assets
disposed of in the ordinary course of business consistent with safe and sound
banking practices; and, to their knowledge, all uses made of, and activities
conducted upon, any real property owned, leased or used by Xxxxxxxxxxx
Bancshares, Xxxxxx Bancshares, and Bank comply in all respects with applicable
state, local or municipal zoning laws and other laws, rules, regulations and
ordinances.
3.15. LITIGATION. Except as reflected in Disclosure Schedule D, there are
no actions, suits, proceedings or claims pending or, to their knowledge,
threatened against Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares, or Bank, or
involving any of their properties or assets, at law or in equity, or before or
by any foreign, federal, state, municipal or other governmental court,
department, commission, board, bureau, agency, instrumentality or other person,
which may, in the reasonable judgment of Xxxxxxxxxxx Bancshares, Xxxxxx
Bancshares, and Bank, result in any material liability to Xxxxxxxxxxx
Bancshares, Xxxxxx Bancshares, or Bank.
3.16. TAX MATTERS. Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares, and Bank have
each:
(a) duly filed all tax returns (the "FILED RETURNS") required to be filed
by it involving a tax liability or other material potential detriment for
failure to file, and all of such Filed Returns are true, complete and correct in
all material respects;
(b) paid, or established reasonable accruals for the payment of, all
federal income taxes and all state and local income taxes and all franchise,
property, sales, employment or other taxes required to be paid in respect to the
periods covered by the Filed Returns;
(c) with respect to the periods prior to the date of this Agreement and
subsequent to the last Filed Return, established reasonable accruals for the
payment of all federal income taxes and all material state and local income
taxes and material franchise, property, sales, employment or other taxes; and
11
(d) properly and timely withheld, remitted and/or paid all withholding
taxes, social security taxes, unemployment taxes and other employment-related
taxes which Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares, or Bank are, by law,
required to withhold, remit or pay.
In addition to the foregoing, neither Xxxxxxxxxxx Bancshares, Xxxxxx
Bancshares, nor Bank (1) is the subject of, nor is there pending or threatened,
any audit with respect to or arising out of any Filed Return; (2) has previously
requested, or has filed a request for, any extension of time to file any return
or pay any tax; or (3) has agreed or consented to the extension of any statute
of limitations respecting the assessment of taxes, additional taxes, penalty or
interest in connection with any tax liability or Filed Return. No tax liens have
been filed or threatened against Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares, or
Bank.
For the purposes of this Agreement, the term "TAX" shall include all
federal, state and local taxes and related governmental charges and any interest
or penalties payable in connection with the payment of taxes.
3.17. EMPLOYMENT BENEFIT PLANS. (1) Except as reflected in Disclosure
Schedule E, neither Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares, nor Bank
maintains or contributes to, nor is Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares,
or Bank required to maintain or contribute to, (i) any "employee welfare benefit
plan" [as defined in Section 3(1) of the Employee Retirement Income Security Act
("ERISA")] or (ii) any "employee pension benefit plan" [as defined in Section
3(2) of ERISA]. Except as reflected in Disclosure Schedule E, neither
Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares, nor Bank maintains or contributes to,
nor has Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares, or Bank adopted or entered
into, any deferred compensation plan, bonus plan, stock option plan, employee
stock option plan or any other employee benefit plan, agreement, arrangement or
commitment (other than normal policies concerning holidays, vacations,
accumulated sick leave, and annual budgeted incentive bonuses previously
disclosed to First Financial).
3.18. LEASES, CONTRACTS AND AGREEMENTS. Disclosure Schedule F reflects all
leases, contracts and agreements to which Xxxxxxxxxxx Bancshares, Xxxxxx
Bancshares, or Bank is a party and which obligate or may obligate Xxxxxxxxxxx
Bancshares, Xxxxxx Bancshares, or Bank to pay any amount in excess of $25,000
over the entire term of any such lease, contract or agreement (the "CONTRACTS"),
true and correct copies of which have been or shall be made available to First
Financial. For the purposes of this Agreement, the Contracts shall not be deemed
to include loan commitments of, loans made by, repurchase agreements made by,
bankers acceptances of, or deposits taken by Bank in the ordinary course of its
banking business. Each and all of the Contracts are legal, valid, binding and
enforceable in accordance with their terms and are in full force and effect.
There are no existing material defaults by any party to the Contracts and no
event has occurred which (whether with or without notice, lapse of time or the
happening or occurrence of any other event) would constitute such default.
3.19. RELATED COMPANY TRANSACTIONS. Except for transactions described in
Disclosure Schedule G, there are no agreements, instruments, commitments,
extensions of credit, tax sharing or allocation agreements or other contractual
agreements of any kind between Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares, or
Bank.
12
3.20. TRANSACTIONS WITH AFFILIATES. Except as reflected in Disclosure
Schedule H, neither Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares, nor Bank (1) has
any loans outstanding to any of its affiliates, executive officers, or
directors, or to any shareholder owning ten percent (10%) or more of its
outstanding shares or (2) is a party to, or otherwise bound by, any contractual
agreement with any of its affiliates, executive officers, or directors, or with
any shareholder owning ten percent (10%) or more of its outstanding shares.
3.21. COMPLIANCE WITH LAWS. Except as otherwise disclosed in Disclosure
Schedule I, Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares, and Bank are in
compliance in all material respects with all applicable laws and regulations and
no action is pending or threatened against Xxxxxxxxxxx Bancshares, Xxxxxx
Bancshares, or Bank by any federal, state or other regulatory authority.
3.22. ACCURACY OF INFORMATION. The factual information relating to
Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares, and Bank contained in this Agreement
and the Disclosure Statements hereto is true, correct and complete in all
material respects. The information relating to Xxxxxxxxxxx Bancshares, Xxxxxx
Bancshares, and Bank supplied for inclusion in the application of First
Financial to the FRB, the Registration Statement filed by First Financial with
the SEC and the Prospectus to be delivered by First Financial to each of the
Shareholders of Xxxxxxxxxxx Bancshares, as of the date supplied by Xxxxxxxxxxx
Bancshares, Xxxxxx Bancshares, and Bank, will be true, correct and complete in
all material respects.
3.23. INSURANCE. Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares, and Bank have
in effect the insurance coverage described in Disclosure Schedule J. All
insurance policies described in Disclosure Schedule J are in full force and
effect; no breach or default exists under any such policy; and Xxxxxxxxxxx
Bancshares, Xxxxxx Bancshares, and Bank have timely filed all claims, if any,
under any such insurance policy.
3.24. LOANS. Each loan reflected as an asset in the Financial Statements,
as well as all other extensions of credit, guarantees, security agreements,
deeds of trust and other documents and instruments executed in connection
therewith (whether intended as security or otherwise) is the legal, valid and
binding obligation of the obligor named therein and is enforceable in accordance
with its terms. Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares, and Bank have made
available to First Financial all material information in possession of
Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares, and Bank concerning all outstanding
loans of Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares, and Bank.
3.25 FIDUCIARY RESPONSIBILITIES. Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares,
and Bank have each performed in all material respects all of its duties as a
trustee, executor, grantor, escrow agent or other fiduciary in a manner which
complies in all material respects with all applicable laws, regulations, orders,
agreements, instruments and common law standards.
3.26. REGULATORY ACTIONS. Except as disclosed in Disclosure Schedule K,
there are no actions or proceedings pending or threatened against Xxxxxxxxxxx
Bancshares, Xxxxxx Bancshares, or Bank by or before the FRB, the OCC, the FDIC,
the SEC or any other governmental agency or authority.
13
3.27. BROKER'S FEES. No person or entity acting on behalf of Xxxxxxxxxxx
Bancshares, Xxxxxx Bancshares, or Bank is or shall be entitled, directly or
indirectly, to any brokerage fee, commission, finder's fee or financial advisory
fee in connection with the transaction contemplated by this Agreement.
3.28. ENVIRONMENTAL MATTERS. Except as disclosed in Disclosure Schedule L,
there are no known material adverse environmental problems or known conditions
affecting any of the properties of Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares, or
Bank. In particular, and without in any way limiting the foregoing, Xxxxxxxxxxx
Bancshares, Xxxxxx Bancshares, and Bank, after due inquiry, warrant and
represent that to the best of their knowledge all hazardous and toxic chemicals,
substances and materials located or used upon any of their respective properties
have been and are being stored, used, transported and disposed of in compliance
with applicable state and federal environmental laws; that there are no
underground storage tanks located upon any of their properties; and that no
action or investigation is pending or threatened by any governmental or
regulatory authority, or by any person, firm or corporation, arising out of any
failure, or alleged failure, to comply with applicable environmental laws,
statutes, rules or regulations.
3.29. DEFERRED DIRECTORS COMPENSATION. Except as disclosed in Disclosure
Schedule M, neither Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares, nor Xxxxxxxxxxx
National maintains, contributes to or is otherwise obligated under any Deferred
Directors Compensation Plan.
ARTICLE 4.
CONDUCT OF BUSINESS OF XXXXXXXXXXX BANCSHARES,
XXXXXX BANCSHARES, AND BANK PENDING CLOSING DATE
4.1. AFFIRMATIVE COVENANTS. From and after the date of this Agreement and
until the Closing Date, Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares, and Bank
shall each:
(a) operate and conduct its business in the ordinary course and consistent
with its prior practices;
(b) preserve intact its corporate existence, business organization, assets,
licenses, permits, authorizations, and business opportunities;
(c) maintain its books, accounts and records in accordance with generally
accepted accounting principles and/or banking practices, as applicable, and
comply with all of its contractual obligations;
(d) maintain all of its properties in good repair, order and condition,
reasonable wear and tear excepted, and maintain appropriate insurance coverage
upon all such properties;
(e) in good faith and in a timely manner (i) cooperate with First Financial
in satisfying the conditions in this Agreement; (ii) diligently assist First
Financial, to the extent it may reasonably require, in obtaining as promptly as
possible all consents,
14
approvals, authorizations and rulings, whether regulatory or corporate, as are
necessary for First Financial to carry out and consummate the transaction
contemplated by this Agreement; (iii) furnish, or cause to be furnished, to
First Financial such information as First Financial may reasonably require for
inclusion in any filings or applications that may be necessary in that regard;
and (iv) perform all acts and execute and deliver all documents reasonably
necessary to cause the transaction contemplated by this Agreement to be
consummated at the earliest possible date;
(f) timely file with the FRB, OCC, FDIC, SEC and other regulatory
authorities all financial statements and other reports to be filed by it and
promptly thereafter deliver to First Financial copies of all financial
statements and other reports required to be so filed;
(g) comply with all applicable laws and regulations, noncompliance with
which would have a material adverse effect upon its financial condition, assets,
liabilities (absolute, accrued, contingent or otherwise) or business;
(h) promptly give written notice to First Financial upon obtaining
knowledge of any event or fact that would cause any of the representations or
warranties of Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares, or Bank contained in or
referred to in this Agreement to be untrue in any material respect, and use its
best efforts to prevent or promptly remedy the same; and
(i) provide to First Financial, or provide First Financial access to, all
books, records, reports, financial statements and other documents and
information as First Financial may from time to time request.
(j) immediately or prior to the date of closing of this contemplated
transaction, establish such additional accruals and reserves as may be necessary
to conform Xxxxxxxxxxx Bancshares', Xxxxxx Bancshares', and Xxxxxxxxxxx
National's accounting and credit loss reserve practices and methods to those of
First Financial.
(k) engage, consistent with prior practices, its independent accountants to
conduct an audit for the year ended December 31, 1995.
4.2. NEGATIVE COVENANTS. Except with the prior written consent of First
Financial, neither Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares, nor Bank shall,
from the date of this Agreement and until the Closing Date:
(a) make or permit any amendment to its Articles of Association or Bylaws;
(b) make or permit any changes in allocating or charging costs which in the
aggregate would cause a material detriment, except as may be required by
applicable regulation or GAAP, and after notice to First Financial;
(c) except for negotiations and discussions between the parties hereto
relating to the transactions contemplated by this Agreement, (i) directly or
indirectly initiate
15
contact with any person or entity in an effort to solicit an acquisition, merger
or consolidation proposal relating to Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares,
or Bank, (ii) enter into negotiation of the terms of an agreement relating to
the acquisition, merger or consolidation of Xxxxxxxxxxx Bancshares, Xxxxxx
Bancshares, or Bank, (iii) permit access to the premises of Xxxxxxxxxxx
Bancshares, Xxxxxx Bancshares, or Bank for the review of its business or
operations (except as required by law), (iv) except in the ordinary course of
business, enter into any oral or written agreement to sell the assets of
Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares, or Bank or to merge, consolidate,
liquidate or dissolve Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares, or Bank, or (v)
authorize or engage any officer, employee, agent or representative of
Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares, or Bank (including but not limited to
investment bankers and financial advisers) to enter into any such solicitation,
negotiation or any such oral or written agreement;
(d) make any change in the number of shares of its capital stock issued and
outstanding, or issue, reserve for issuance, grant, or authorize the issuance of
any shares of their capital stock or subscriptions, options, warrants, calls,
rights or commitments of any kind relating to the issuance or conversion into
shares of their capital stock;
(e) incur, assume or become subject to, whether directly or by way of any
guarantee or otherwise, any obligation or liability (absolute, accrued,
contingent or otherwise);
(f) permit or allow any of its property or assets to become subject to any
pledge, lien, security interest or encumbrance, restrictions or change of any
kind;
(g) cancel any debts in excess of $25,000, waive any claims or rights of
material value or sell, transfer, or otherwise dispose of any of its properties
or assets, except in the ordinary course of business;
(h) dispose of or permit to lapse any of its rights to the use of any
material trademark, trade name or copyright, or dispose of or disclose to any
person any material trade secret not theretofore a matter of public knowledge;
(i) grant or permit any increase in compensation, or pay or agree to pay or
accrue any bonus or like benefit, to or for the credit of any of its directors,
officers or employees, or enter into, or permit, of any employment or consulting
agreement or other agreement for personal services with any of its directors,
officers or employees, or adopt, amend or terminate any Employee Benefit Plan or
change or modify the period of vesting or retirement age for any participant of
any such plan (except as required by or to comply with any law or regulation);
(j) declare, pay or set aside for payment any dividend or other
distribution or payment in respect of shares of its capital stock, except for
(i) normal, regular dividends or other distributions of Bank to Xxxxxx
Bancshares and Xxxxxx Bancshares to Xxxxxxxxxxx Bancshares, and (ii) Xxxxxxxxxxx
Bancshares regular dividend of $.50 per share payable to its shareholders in
January 1996;
16
(k) acquire the capital stock or other equity securities of any corporation
or any equity or ownership interest in any partnership or other business
enterprise, except through foreclosure, the exercise of creditors' remedies or
in a fiduciary capacity;
(l) make aggregate capital expenditures and commitments in excess of
$25,000 for additions to its premises or equipment; or
(m) except as disclosed in Disclosure Schedule N, modify any outstanding
loans, make any new loans or acquire any loan participations, unless such
modifications, new loans, or participations are made in the ordinary course of
business.
4.3. CERTAIN ACTIVITIES IN ORDINARY COURSE. For the purposes of Section
4.2(i), it shall be considered to be in the ordinary course of business for
Xxxxxxxxxxx Bancshares and Bank to grant reasonable salary increases to officers
and employees for 1996, and to make its usual and customary matching
contribution to contributions made by employees of Xxxxxxxxxxx Bancshares or
Bank under its or their 401(k) Plan, but First Financial shall be notified in
writing of any such increases or contributions to be paid after the date of this
Agreement.
4.4. COVENANTS. From and after the date of this Agreement and until
consummation or termination of the transaction contemplated by this Agreement,
neither Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares, nor Bank shall take any
action which would cause Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares, or Bank to
be in breach of any of the covenants contained in this Article 4; and
Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares, and Bank shall, within their ability
to do so, cause Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares and Bank to keep and
perform all of the covenants contained in this Article 4.
ARTICLE 5.
WARRANTIES, REPRESENTATIONS
AND COVENANTS OF FIRST FINANCIAL
First Financial warrants and represents to, and covenants and agrees with,
Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares, and Bank as follows:
5.1. ORGANIZATION AND STANDING OF FIRST FINANCIAL. First Financial is a
corporation duly organized, validly existing, and in good standing under the
laws of the State of Texas, with corporate power to own property and carry on
its business as it is now being conducted.
5.2. CAPITALIZATION. First Financial has an authorized capitalization of
10,000,000 shares of common stock of the par value of $10.00 per share, of which
5,012,133 shares are issued, outstanding, and fully paid as of the date of this
Agreement.
5.3. AUTHORITY OF FIRST FINANCIAL. This Agreement has been duly executed
and delivered by First Financial and, subject to the conditions precedent to
Closing of the transactions set forth herein, is a valid, legally binding and
enforceable obligation of First Financial. Neither the execution, delivery or
performance of this Agreement in its entirety, nor the consummation of all of
the transactions contemplated hereby, will violate (with or without
17
the giving of notice or the passage of time), be in conflict with, result in a
breach of any provision of, or constitute a default under, any provision of law
applicable to First Financial, or any agreement or understanding, order,
judgment, award, decree, statute, ordinance, regulation or other restriction of
any kind or character to which First Financial is a party or by which any of its
or their assets or properties is subject or bound. There are no actions, suits,
proceedings or claims pending or, to its knowledge, threatened against First
Financial, at law or in equity, or before or by any foreign, federal, state,
municipal or other government court, department, commission, board, bureau,
agency, instrumentality or other person which may result in liability to or of
First Financial upon the consummation of the transactions contemplated hereby or
which would prevent or delay such consummation.
5.4. NO ADVERSE CHANGE. From the date of this Agreement until the Closing
Date, First Financial shall not have suffered any material adverse change in its
financial condition, assets, liabilities (absolute, accrued, contingent or
otherwise) or business.
5.5. DUE DILIGENCE. The officers, employees or other representatives of
First Financial have reviewed and examined the assets, property (real and
personal), leases and all other contractual arrangements to which Xxxxxxxxxxx
Bancshares, Xxxxxx Bancshares, or Bank is a party and all business records of
Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares, and Bank including, but not limited
to, committee and directors' minutes, reports of condition, reports of income,
tax returns, deposit agreements, loan portfolios, documents pertaining to legal
matters, and financial statements, all of which review and examination was
conducted upon the premises of Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares, and
Bank, and First Financial hereby confirms the acceptability of such due
diligence review.
5.6. COVENANTS. First Financial covenants and agrees that it shall:
(a) use its best efforts in good faith and in a timely manner to (i)
cooperate with Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares, and Bank in satisfying
the conditions in this Agreement, (ii) obtain as promptly as possible all
consents, approvals, authorizations and rulings, whether regulatory or
corporate, as are necessary for First Financial to carry out and consummate the
transactions contemplated by this Agreement, including specifically (but without
limitation) the approval called for by Section 5.7, and (iii) furnish
information concerning First Financial and its subsidiaries not previously
provided to Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares, and Bank required for
inclusion in any filing or applications that may be necessary in that regard;
(b) perform all acts and execute and deliver all documents necessary to
cause the transactions contemplated by this Agreement to be consummated at the
earliest possible date;
(c) promptly give written notice to Xxxxxxxxxxx Bancshares, Xxxxxx
Bancshares, and Bank upon obtaining knowledge of any event or fact that would
cause any of the representations or warranties of First Financial contained in
or referred to in this Agreement to be untrue in any material respect, and use
its best efforts to prevent or promptly remedy the same; and
18
(d) cause its officers, directors and representatives to treat as
confidential any and all information concerning Xxxxxxxxxxx Bancshares, Xxxxxx
Bancshares, and Bank which is furnished to First Financial, its directors,
officers, employees, shareholders, agents, representatives or advisors, in
connection with this Agreement, or which was furnished prior to the execution of
this Agreement for the purpose of First Financial reviewing and evaluating the
transaction contemplated by this Agreement, except insofar as disclosure to
certain parties is necessary to meet the conditions of this Agreement.
5.7. FEDERAL RESERVE APPROVAL. Specifically, but without limiting the
effect of Section 5.6, promptly upon execution of this Agreement, First
Financial shall make application to the Board of Governors of the Federal
Reserve System (the "FRB") for prior approval to acquire the Xxxxxxxxxxx
Bancshares Stock in accordance with this Agreement as required by the Bank
Holding Company Act of 1956, as amended, and applicable regulations. Promptly
upon receipt, First Financial shall furnish Xxxxxxxxxxx Bancshares, Xxxxxx
Bancshares, and Bank with a copy of the notice of approval or disapproval of the
application made by it to the FRB.
5.8. SEC REGISTRATION. Without limiting the effect of Section 5.6, upon
execution of this Agreement, First Financial shall proceed to file a
Registration Statement with the Securities and Exchange Commission pursuant to
the Act covering the shares of First Financial Stock to be issued pursuant to
this Agreement. Promptly upon receipt of such declaration of the effectiveness
of such Registration Statement from the Securities and Exchange Commission,
First Financial shall furnish Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares, and
Bank with a copy of the approval or disapproval of the effectiveness of such
Registration Statement.
ARTICLE 6.
SURVIVAL OF WARRANTIES, INDEMNIFICATION AND LIABILITY
6.1. NATURE AND SURVIVAL OF REPRESENTATIONS AND WARRANTIES. The covenants,
representations and warranties of the parties hereto shall survive the Closing
Date, and all inspections, examinations, or audits on behalf of the parties, for
a period of two (2) years after the Closing Date.
ARTICLE 7.
TERMINATION
7.1. CIRCUMSTANCES AUTHORIZING TERMINATION. Notwithstanding anything herein
to the contrary, this Agreement may be terminated and the Stock Purchase Offer
contemplated hereby may be abandoned at any time, but prior to the Closing Date:
(a) by mutual written consent duly authorized by the Boards of Directors of
First Financial and Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares, and Bank;
(b) by First Financial (i) if First Financial learns or becomes aware of a
state of facts or breach or inaccuracy of any representation or warranty or
covenant of Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares, or Bank contained in
Article 3 which
19
constitute a material adverse change from that represented in this Agreement, or
(ii) if any of the conditions to Closing contained in Article 2 are not
satisfied or, if not satisfied, waived in writing by First Financial;
(c) by Xxxxxxxxxxx Bancshares (i) if Xxxxxxxxxxx Bancshares learns or
becomes aware of a state of facts or breach of inaccuracy of any representation
or warranty or covenant of First Financial contained in Article 5 which
constitutes a material adverse change from that represented in this Agreement,
or (ii) if any of the conditions to Closing contained in Article 2 are not
satisfied or, if not satisfied, waived in writing by Xxxxxxxxxxx Bancshares,
Xxxxxx Bancshares, and Bank;
(d) by First Financial and Xxxxxxxxxxx Bancshares if the Closing Date shall
not have occurred on or before March 31, 1996, or such later date agreed to in
writing by First Financial and Xxxxxxxxxxx Bancshares, Xxxxxx Bancshares, and
Bank; or
(e) by First Financial or Xxxxxxxxxxx Bancshares if any court of competent
jurisdiction in the United States (federal or state) or other governmental body
shall have issued an order, decree or ruling or taken any other action
restraining, enjoining or otherwise prohibiting the exchange of shares or the
merger, and such order, decree, ruling or other action shall have been final and
nonappealable.
ARTICLE 8.
MISCELLANEOUS PROVISIONS
8.1. PUBLIC ANNOUNCEMENTS. Prior to the Closing Date, neither Xxxxxxxxxxx
Bancshares, Xxxxxx Bancshares, Bank, nor First Financial, nor any person
affiliated with any of them, shall, without the prior approval of the other
parties, make any written public announcement, or make any written statement or
release to the press with respect to this Agreement or the transactions
contemplated hereby.
8.2. APPLICABLE LAW. This Agreement and the legal relations between the
parties hereto shall be governed by and construed in accordance with the laws of
the Xxxxx xx Xxxxx xxx xx xxx Xxxxxx Xxxxxx of America.
8.3. PARAGRAPH AND OTHER HEADINGS. Article and section headings contained
in this Agreement are for reference purposes only and shall not affect the
meaning or interpretation of this Agreement.
8.4. WAIVERS AND AMENDMENTS. This Agreement may be amended, modified or
supplemented only by a written instrument executed by the parties hereto. The
waiver by any party hereto of a breach of this Agreement shall not operate or be
construed as a waiver of any subsequent breach.
8.5. EXPENSES.
20
(a) Whether or not the transactions contemplated by this Agreement are
consummated, and except as otherwise expressly provided in this Agreement, each
of the parties shall be responsible for their respective attorneys' fees and
expenses incident to the negotiation, preparation, execution and consummation of
the transaction contemplated by this Agreement including attorneys' and
accountants' fees and expenses.
8.6. ENTIRE AGREEMENT. This Agreement, including the Exhibits and
Disclosure Schedules, embodies the entire agreement and understanding of the
parties with respect to the subject matter contained herein. There are no
restrictions, promises, representations, warranties, covenants or undertaking
other than those expressly set forth or referred to herein.
8.7. NOTICES. All notices, requests, demands or other communications which
are required or may be given under this Agreement shall be in writing and shall
be deemed to have been duly given if delivered personally or sent by registered
or certified mail, return receipt requested, postage prepaid:
(a) In the case of First Financial, to:
Xx. Xxxxxxx X. Xxxxxx
Chairman of the Board, President and Chief Executive Officer
First Financial Bankshares, Inc.
Xxxx Xxxxxx Xxx 000
Xxxxxxx, Xxxxx 00000
(b) in the case of Xxxxxxxxxxx National Bancshares, Inc., Xxxxxx
Bancshares, Inc., and/or Weatherford National Bank, to:
Xx. Xxxxxx X. Xxxxxxxxxxx
Chairman of the Board and President
Xxxxxxxxxxx National Bancshares, Inc.
Xxxx Xxxxxx Xxx 0000
Xxxxxxxxxxx, Xxxxx 00000
or to such other addresses as any party shall specify by notice to the
others.
8.8. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original and all of which
together shall be deemed to be one and the same.
8.9. ATTACHMENT OF DISCLOSURE SCHEDULES. Weatherford Bancshares, Xxxxxx
Bancshares, Bank and First Financial acknowledge that the Disclosure Schedules
referenced herein may not be attached hereto at the time of execution of this
Agreement. It is the intent of all parties hereto that the form and content of
all such Disclosure Schedules will be prepared in form acceptable to First
Financial and that such Disclosure Schedules shall then be attached to this
Agreement and that such Disclosure Schedules shall then become a part of this
Agreement for all purposes. In the event that the contents in the Disclosure
Schedules are not acceptable to First Financial, this Agreement may be
terminated by First Financial by written notice and be
21
of no further force and effect. Notwithstanding the fact that any such
Disclosure Schedules may not be attached hereto at the time of execution, the
date of this Agreement or date of execution of this Agreement shall for all
purposes be the date first written above.
8.10. BINDING EFFECT - ASSIGNMENT. This Agreement is binding upon the
undersigned parties, their heirs, personal representatives, successors and
assigns. The rights of First Financial under this Agreement may not be assigned
without the prior written consent of Weatherford Bancshares, Xxxxxx Bancshares,
and Bank, except that, at Closing, FFB Delaware or another subsidiary of First
Financial may acquire the Shares so long as First Financial remains liable for
its obligations under this Agreement.
8.11. DEFINITIONS. In addition to other definitions contained elsewhere in
this Agreement, as used in this Agreement:
(a) an "AFFILIATE" means any bank, corporation, partnership or other entity
which, directly or indirectly, controls, is controlled by, or is under common
control with, Weatherford Bancshares, Xxxxxx Bancshares, and Bank;
(b) references to a particular "ARTICLE" or "SECTION" are to the given
article or section of this Agreement; and
(c) unless context otherwise requires, words of the singular number include
the plural and of the plural include the singular and words of the masculine
gender include the feminine and neuter.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement, in
multiple originals, as of the day and year first above written.
FIRST FINANCIAL BANKSHARES, INC.
ATTEST:
By:/s/ Xxxxxx X. Xxxxxx By:/s/ Xxxxxxx X. Xxxxxx
-------------------- ---------------------
Xxxxxx X. Xxxxxx Xxxxxxx X. Xxxxxx,
Executive Vice President Chairman of the Board, President
and Chief Financial Officer and Chief Executive Officer
XXXXXXXXXXX NATIONAL
ATTEST: BANCSHARES, INC.
By:/s/ Mac X. Xxxxxxx By:/s/ Xxxxxx X. Xxxxxxxxxxx
------------------ -------------------------
Name:Mac X. Xxxxxxx Xxxxxx X. Xxxxxxxxxxx
Title:Director Chairman of the Board and President
22
XXXXXX BANCSHARES, INC.
ATTEST:
By:/s/ Mac X. Xxxxxxx By:/s/ Xxxxxx X. Xxxxxxxxxxx
------------------ -------------------------
Name:Mac X. Xxxxxxx President
Title:Director
WEATHERFORD NATIONAL BANK
ATTEST:
By:/s/ Mac X. Xxxxxxx By:/s/ Xxxxxx X. Xxxxxxxxxxx
------------------ -------------------------
Name:Mac X. Xxxxxxx Xxxxxx X. Xxxxxxxxxxx,
Title:Director Chairman of the Board and President
23
